South Dakota Cannabis Consultants | State Cannabis Law Review

Quantum 9‘s, South Dakota Cannabis Consultants reviewed the recent legislation in South Dakota, and this article outlines everything you need to know. Both recreational (adult-use) and medical marijuana initiatives will appear on the November 2020 Ballot. The two efforts differ in their approaches; the first (Amendment A) would allow adults 21 and older to purchase cannabis legally in retail outlets. The second initiative (Measure 26) establishes laws for medical patients to access medical marijuana. If these two initiatives pass, South Dakota will become the first state to pass both medical cannabis and recreational legalization initiatives on the same ballot.

South Dakota Projected Cannabis Market Size

South Dakota Cannabis Consultants calculated that there are 884,659 residences of the state of South Dakota, 71% of that number are over the age of 21 (628,107 potential customers) not inclusive of roughly 13.9 million visitors a year, according to a study conducted in 2018 by Tourism Economics.

South Dakota Medical Marijuana Patient Population Projection

Taking an average of 2% of the population being potential medical cannabis patients, the Quantum 9 projected patient population falls between (17,000-20,000 medical cannabis patients) total statewide patients. We project that the majority of those patients will use cannabis to treat pain and nausea, as these conditions are the top two most recommended ailments based on patient totals from other markets. 

Amendment A | South Dakota Marijuana Initiative Quick Stats

  • Published by Brendan Johnson, former U.S. Attorney for the District of South Dakota
  • Provides a structure for medical marijuana and hemp sales by April 1, 2022;
  • License types include commercial cultivators, manufacturers, testing facilities, wholesalers, and retail;
  • Does not legalize hemp but requires legislators to pass laws for cultivation, processing and the sale of hemp;
  • Allows minimalities to dictate the number of licenses including the banning of licenses;
  • Ability to grow 6 plants at home in a locked space;
  • Individuals are allowed to use, possess and distribute up to one ounce;
  • Individuals are allowed to distribute no more than 8 concentrated grams;
  • A 15% tax would be applied to Marijuana Sales;
  • 50% of the tax revenue goes to state public schools;
  • 50% of the tax revenue goes to the State’s general fund;
  • Municipalities retain the right to ban cultivators, testing laboratories, wholesalers, and retail stores
  • Secretary of State’s office announced 36,707 valid signatures, 30,000 were required to appear on the ballot; and
  • Backed by the Marijuana Policy Project and New Approach PAC.

Amendment A |Qualifications and Requirements for Licensees

  • Security Plan – (Lighting and Alarm Requirements to prevent diversion);
  • Testing, Packaging and Labeling Plan;
  • Safety Plans (Limiting Child Consumption);
  • Pesticide Plans;
  • Inspection, Tracking, and Record-keeping Plans;
  • Advertising and Marketing Plan;
  • Environmental Plan;
  • Agricultural Plan; and
  • Food and Product Safety Plan.

Measure 26 | South Dakota Marijuana Initiative Quick Stats

  • Establishes a medical marijuana program;
  • Allows for the testing, cultivation, processing (manufacturing) and dispensing of medical marijuana;
  • Filed by Melissa Mentele, executive director of New Approach South Dakota;
  • Qualifying conditions including severe, debilitating pain, seizures, cachexia or wasting syndrome; severe nausea; or severe and persistent muscle spasms, and multiple sclerosis
  • Allows for delivery to residence;
  • Allows for reciprocity, medical cannabis patients from other states are allowed to obtain cannabis in South Dakota;
  • Patients can possess a max of 3 ounces;
  • Home cultivation is allowed to grow at least 3 plants or higher with a physician’s recommendation;
  • Requires the enactment of rules within 120 days from the effective date of July 1, 2020 meaning rules would have to be published by October 29, 2021;
  • The state Department of Health would be required to start issuing patient identification cards no later than 140 days from the effective date; and
  • Supporters include New Approach South Dakota and Drey Samuelson. 

Measure 26 | Qualifications and Requirements for Licensees

  • Operating Procedures;
    • Recordkeeping; and
    • Security;
  • Zoning Approval;
  • Health and Safety Plan;
  • Cultivation Plans;
  • Manufacturing Plans;
  • Dispensing Plans;
  • Transportation and Storage Plans;
  • Employment and Training Plans;
  • Advertising and Marketing Plans;
  • Packaging and labeling Plans;
  • Testing Plans; and
  • Reciprocity Plans.

South Dakota Cannabis Opposition  

South Dakota passed a bill in 2019 legalizing industrial hemp but was strongly opposed by Republican Gov. Kristi Noem mainly due to the testing capacity for THC.  The U.S. Department of Agriculture (USDA) has struggled to implement national standards outlined in the Farm Bill. William Richmond, head of the Specialty Crops Program in the USDA’s Agricultural Marketing Service leads the efforts.

If you are looking for expert South Dakota cannabis consultants to help with your submission, reach out to the experts that wrote this article.

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Michael Mayes

Michael Mayes

Michael Mayes is the founder and CEO of Quantum 9, Inc., a Chicago, IL-based cannabis consulting firm. We specialize in getting high net worth individuals and private equity cannabis business licenses to cultivate, manufacture and dispense marijuana. We have over 50 marijuana consultants that work for the company, and we have practiced in 12 countries. Our areas of expertise include permit acquisition, team building, employee training planning, and process planning. We help clients fully maximize the potential of any cannabis cultivation, processing, and dispensary business.

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