Legislators defeat bill to dismantle adult-use legalization law and restrict medical cannabis

Earlier this year, legalization opponents in Montana attempted to undo the will of voters and repeal the state’s adult-use legalization law through a bill in the state legislature. Members of Senate Business, Labor and Economic Affairs Committee ultimately defeated this effort, however, through a 6-4 vote to table Senate Bill 546. The proposal would have prohibited adult-use cannabis dispensaries and imposed draconian restrictions on the state’s medical cannabis program.

Following voter approval of two ballot initiatives to legalize cannabis for adults in 2020, Montana’s legal cannabis market continues to expand. In the November 2022 election, several municipalities in the state voted on local cannabis policy measures. Some approved cannabis businesses and additional local taxes on cannabis, while others rejected similar proposals.

Adult-use cannabis businesses first opened their doors in Montana in January 2022. As of March 2023, the state reported a total tax haul of more than $53 million from adult-use cannabis sales. After covering costs to administer the program, this new cannabis tax revenue is directed to substance abuse treatment programs, services for families of veterans, and conservation efforts.

Adult use sales ramp up in many counties as others debate whether to allow cannabis businesses

Adult-use cannabis sales began in Montana earlier this year in counties where voters approved I-190, the 2020 ballot measure that legalized cannabis in Montana. Through local referenda, counties that voted against the measure are able to opt in and allow cannabis businesses in their jurisdiction if local voters approve. About half the state’s counties currently allow cannabis sales.

Last year lawmakers passed House Bill 701, a bill that made modifications to the voter-approved ballot initiative. A provision included in that law also makes it possible for localities to opt out of allowing cannabis sales, making the future of cannabis dispensaries in some municipalities uncertain. Anti-cannabis activists are hoping to shut down cannabis businesses in some counties later this year.

In the background of these local debates, Montana’s Department of Revenue reports that legal cannabis sales generated $20 million in new tax revenue in the first half of 2022, and sales increased over 20% from January to June.

Timeline of marijuana policy reform in Montana

2004: Voter approve a ballot initiative legalizing medical marijuana

2011: State lawmakers passed SB 423, which blocked access to medical cannabis for most patients

2016: Voters approve I-182, which reopened access to medical cannabis; read a summary and history of Montana’s medical cannabis law here.

2020: Voters approve I-190 and CI-118 which legalize marijuana and sets 21 as the legal age; read a summary of the legalization policy here.

2021: State lawmakers approve House Bill 701, making modifications to the voter-approved legalization law

2022: Adult use cannabis sales begin.

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