South Dakota voters made history last Election Day by becoming the first state in the nation to pass both medical and adult-use cannabis legalization initiatives on the same day.
But, South Dakota could also make history as the first state to see a voter-passed cannabis initiative overturned as the result of a legal battle initiated by its governor, as Cannabis Wire has reported. While Gov. Kristi Noem has left alone Measure 26, which legalized medical cannabis, she called for a lawsuit against Amendment A, a constitutional amendment to legalize cannabis for adult use and also require the legislature to develop medical cannabis and hemp rules by April 1, 2022. The South Dakota Supreme Court is expected to release a decision any day now on the challenge to Amendment A.
It was in the shadow of that looming Supreme Court decision that the first meeting of the South Dakota Adult-Use Marijuana Subcommittee, a group of state lawmakers, took place this week (a separate subcommittee on medical cannabis is also underway). Once that decision comes down, the chair of the group said he’ll put together a separate, smaller work group of five or so members to hammer out next steps.
“I think the big, big thing affecting this committee that we don’t know yet about is the Supreme Court decision on Amendment A,” Chair Hugh Bartels said. “And I think that will really [determine] what we do in our next two or three meetings if it’s upheld.” Bartels added that a decision will come by July 1 or before the next meeting.
One of the major themes from Tuesday’s meeting: South Dakota could become the first state where municipally-owned cannabis businesses take off. Yvonne Taylor, executive director of the South Dakota Municipal League, said that the League is “strongly advocating the ability of a municipality to own and operate dispensaries,” adding that the League has “proposed an amendment to the medical side of things that would allow that to happen. It would not be mandated, but it would be an option for cities to consider.”
Municipalities that have run liquor stores, she said, would be familiar with the process.
“We have quite a bit of interest in this,” Taylor said. “The advent of recreational marijuana, especially, is going to bring in a lot of money and a lot of outside interests outside of South Dakota. And we think that municipal ownership of the dispensary piece of this would be the way to make sure that any kind of profits go back into the community, and into the state, and that there are no outside influences.”
Localities that wanted to more closely work with the private sector could do so through contracting out the “operation of those licenses,” Taylor said.
“But it would keep the proceeds local,” she added. “100% South Dakota ownership of this area.”
The subcommittee meeting was filled with debate among members and invited speakers. Speakers included Taylor, Justin Smith, sheriff in Larimer County, Colorado; Eric Whitcher, director of the Pennington County Public Defender’s Office; James Marsh, a consultant out of Tripp, South Dakota; and Alexis Tracy, the Clay County State’s Attorney.
Taylor was asked, for example, where else in the country municipalities had taken on ownership of cannabis businesses.
“We would be plowing new ground,” Taylor said, adding that the only such shop she’s come across is in Washington State, which was in reference to The Cannabis Corner, located in North Bonneville, Washington.
The subcommittee will be getting a hands-on education, too. In early July, the group will go on a tour of the Flandreau Santee Sioux Tribe cannabis facilities, followed by a meal at the Royal River Casino. The group of lawmakers is also aiming to travel to Colorado in late August or September.
The medical cannabis study subcommittee will soon head to Iowa to learn from the state’s experiences with medical cannabis. Additionally, the committee has contacted Iowa Governor Kim Reynolds’ office to schedule a meeting, without success, the group discussed.
“We need to have open minds to move forward,” Chair Hugh Bartels said.
Noem, meanwhile, has walked an interesting line with regard to cannabis law reform in the state. In January, Noem signed an executive order that revealed that she called for the lawsuit challenging Amendment A. “The initiative process used to place Constitutional Amendment A on the ballot was not proper and violated the procedures set forth in the South Dakota Constitution,” read Noem’s executive order.
But, Noem has voiced support for medical cannabis. Noem tweeted last week, “I want South Dakota to have the best, most patient-focused medical cannabis program in America. I’ve heard from people who are hurting & hopeful for relief. We are 100% committed to starting this program as quickly & responsibly as possible.”