New Mexico proposes new rules for recreational pot growers

·3 min read

SANTA FE, N.M. (AP) — New Mexico on Tuesday took its first major regulatory steps toward legal production of recreational marijuana, publishing lengthy proposed ground rules for cannabis businesses that outline future licensing fees, quality controls, audit requirements and criminal background checks for producers.

The state Regulation and Licensing Department announced the start of a public comment period that will culminate with a June 29 hearing as the agency asserts control over the recreational marijuana legalization effort. The proposal would allow larger marijuana crops per business — nearly three times the current 1,750 plant limit for medical cannabis growers.

“Today’s proposed rules don’t mean the conversation is over," agency Superintendent Linda Trujillo said in a statement. "Through public comment, public hearings and ongoing conversations, we will continue to strengthen these rules to ensure the best possible outcomes.”

Democratic Gov. Michelle Lujan Grisham signed the legalization bill last month. It authorized recreational marijuana sales no later than April 1, 2022.

The law beginning June 29 will allow people age 21 and over to possess up to 2 ounces (56 grams) of marijuana. By April 2022, people will be allowed to grow up to six plants at home, or 12 per household.

The state faces a Sept. 1 deadline to begin issuing licenses to marijuana producers. That should allow time for growers to scale up production so they can meet initial market demand.

The proposed rules would apply to large-scale cannabis producers, tiny marijuana microbusinesses and specialized growers of medical cannabis.

Applicants must provide proof they have valid water rights, describe any past criminal convictions and provide assurances that their businesses will operate at least 300 feet (91 meters) away from schools or daycare centers.

Regulators would have discretion over what constitutes a disqualifying criminal conviction. The proposed rules specifically cited fraud, deceit, embezzlement and drug trafficking.

Local governments would have the power to limit the locations of marijuana business and their hours of operation under zoning ordinances, though current medical marijuana dispensaries will not have to relocate.

The Albuquerque City Council already is considering a proposal to bar cannabis businesses from the historic city center, the Route 66 corridor and within 300 feet (94 meters) of areas zoned for residential or mixed use.

The proposed state regulations would increase the cap on the number of plants per producer to 4,500 under a tiered licensing system.

The largest producers that grow more than 3,500 mature plants at a time will pay a slightly higher annual per-plant fee of $22, versus $18 for lower-level industrial farms.

Production caps under the state’s medical marijuana program, founded in 2007, have been a constant source of legal challenges and criticism by patients who complain of high prices and limited supplies.

Regulators are seeking authority to intervene in the event of a medical marijuana shortage with a set-aside quota of up to 25% of crops, 10% of retail inventory and reduced licensing fees on medical pot plants. Under the new legalization law, taxes are waived on sales of limited quantities of medical marijuana, bringing the commodity in line with other medication.

Microbusinesses that grow up to 200 plants would fall under a separate fee and oversight arrangement.

The licensing requirements for pot producers represent only the first round of regulations for the industry as the state sets up the permit process for cannabis servers, licenses for cannabis-industry training programs and more by the start of 2022.

The agency talked with established medical marijuana producers to develop the regulatory framework for recreational marijuana producers, Trujillo said.

Morgan Lee, The Associated Press