When Republican presidential candidate Donald Trump came out in favor of Amendment 3, the adult-use marijuana ballot measure slated for a vote on Nov. 5, it was yet another surprising wrinkle in the ongoing effort to legalize recreational cannabis in Florida.
“As a Floridian, I will be voting YES on Amendment 3 this November,” Trump wrote on his social media network, Truth Social on Sept.8.
Supporters of the measure are hopeful that the former president’s support will nudge some of the undecided voters – who represent 15% of the electorate – in the direction of a “Yes” vote.
Adult-use initiative in jeopardy?
With little over a month to go before the national election, polls show the future of Florida adult-use cannabis balanced on a knife’s edge.
Ballot measures in Florida must garner at least 60% of the vote to pass, meaning every vote is critical.
A recent poll by Fox News showed 66% of Floridians support Amendment 3, while another poll by Florida Atlantic University found only 56% planned to vote yes.
While polls show the “yes” voters closely scattered around the 60% mark needed to pass, the funding for and against the initiative is anything but even.
Smart & Safe Florida, the Trulieve-led political action committee (PAC) backing Amendment 3, has raised more than $100 million as of Sept. 20.
On the other side of the fence, the two anti-adult-use PACs – Florida Gov. Ron DeSantis’ Florida Freedom Fund and Keep Florida Clean – together have raised just less than $20 million.
Large donors and the hemp industry
Large donors in both camps are leading the charge.
Tallahassee-based multistate operator Trulieve Cannabis Corp. has contributed at least $87 million to Smart & Safe, while Ken Griffin – the billionaire founder of Miami-based Citadel Hedge Fund – has contributed $12 million to Keep Florida Clean, with a promise of another $7 million to come.
To further complicate matters, Florida’s hemp executives are working to defeat the measure and have pledged $5 million to the cause.
This comes after DeSantis on June 7 vetoed Senate Bill 1698, which would have banned intoxicating hemp-derived cannabinoids and dealt the state’s hemp industry a mortal blow.
“We know nothing in life is free, and neither was this veto,” states the introductory post for a WhatsApp group called Save Florida Hemp, which has more than 1,000 members that include major labs and hemp manufacturers.
“He (DeSantis) chose hemp as his champion, and now we’ve got to deliver.”
Florida cannabis dominated by MSOs
A November 2023 review of Florida’s cannabis industry showed a market dominated by MSOs.
Of the 603 medical marijuana dispensaries, 21% were owned by Trulieve, with 61.4% held by Verano Holdings Corp., Ayr Wellness, Curaleaf Holdings and Surterra.
The Florida medical market is quite large, with almost 4% of the state’s population registered as MMJ patients.
With the approval of Amendment 3, it is probable that most existing MMJ operators would begin operating in the adult-use market.
New law – and what’s not in it
Amendment 3 would allow “adults 21 years or older to possess, purchase or use marijuana products and marijuana accessories for non-medical personal consumption by smoking, ingestion or otherwise.”
It also “allows Medical Marijuana Treatment Centers, and other state licensed entities, to acquire, cultivate, process, manufacture, sell, and distribute such products and accessories.”
As written, Amendment 3 would mostly leave adult-use cannabis in the hands of the state’s vertically integrated medical cannabis structure.
However, that is because this and other aspects of a fully fleshed-out adult-use market have been intentionally excluded from Amendment 3’s wording.
Topics that are not mentioned include specific marijuana license types and the cost of adult-use licenses, a possible state excise tax, social equity provisions, potency limits and how much cannabis can be purchased at any one time.
Also not mentioned: whether companies beyond those currently licensed under the state’s medical marijuana market might qualify for adult-use licenses.
While these omissions have been criticized by opponents of the initiative, this was done to avoid a single-subject challenge by the state Supreme Court.
Florida’s constitution requires that an initiative “embrace but one subject and matter.”
A single-subject challenge sank a 2020 adult-use initiative in South Dakota and a 2020 MMJ ballot measure in Nebraska.
Additionally, a previous adult-use initiative in Florida was shot down by the state’s high court, though for other reasons.
That said, Amendment 3 passed a review by the state Supreme Court on April 1, 2024.
Fiscal impact of Amendment 3
The current fiscal impact of adult use is limited to current state and local sales taxes, which are estimated to be $197 million.
Should the state Legislature enact an excise tax on adult-use sales, this number could be significantly higher.
Adult-use marijuana time frame
If Amendment 3 passes, the new law would take effect six months after approval, or on May 5, 2025.
However, in addition to DeSantis’ stance against adult use, both chambers of the state Legislature are dominated by the Republican Party, which is seen as less favorable to cannabis.
Political jockeying could delay matters far beyond the six-month time frame.
Tampa NPR reporter Sky Lebron expects it will take several years after passage for the adult-use market to get up and running.
“The first thing it’s going to see is going to be some pushback from the Legislature and, potentially, some more legal challenges,” Lebron said.
“Even when medical marijuana was passed in 2016 in the state, it still took about two years for things to be implemented across Florida.”
Potential good news for cannabis
In a separate issue, many supporters of the U.S. Drug Enforcement Administration’s movement to reclassify marijuana from Schedule 1 to Schedule 3 under the Controlled Substances Act have been concerned the next president might have unfavorable views toward cannabis.
However, Democratic presidential candidate Kamala Harris has been an outspoken marijuana advocate, and Trump had this to say about cannabis on a national level in his recent social media post about Amendment 3:
“As President, we will continue to focus on research to unlock the medical uses of marijuana to a Schedule 3 drug, and work with Congress to pass common sense laws, including safe banking for state authorized companies, and supporting states’ rights to pass marijuana laws, like in Florida, that work so well for their citizens.”
With both presidential candidates supporting marijuana, it is quite possible the U.S. cannabis industry could experience smoother economic and political waters in the coming years.
Rachel Wright is a certified public accountant and the founder and CEO of Los Angeles-based Verdant Strategies, an accounting, financial management and strategic consulting firm. She can be reached at rwright@verdantstrategies.com.
Simon Menkes is a certified public accountant at Verdant Strategies. He can be reached at smenkes@verdantstrategies.com.
