Last Friday, the Guam Bar Association, the District Courts of Guam, and the District Court for the Commonwealth of the Northern Mariana Islands (CNMI) held a virtual seminar called “Marijuana Hits the Shores of Guam and the Commonwealth of the Northern Mariana Islands.”
Guam and CNMI are two United States territories where adult use and medical cannabis are legal, but adult use sales have yet to take off in Guam.
In September 2020, Guam’s Cannabis Control Board released its proposed rules and regulations for adult use cannabis sales, and wrapped up public hearings in November. Since then, though, there’s been very little movement.
Daniel Collins, the United States Bankruptcy Judge for the District of Arizona, moderated the panel, which included: Vanessa Williams, chair of the Guam Cannabis Recreational Control Board; Milton Morinaga, chair of the Guam Visitors Bureau; and Mitchell Kahn, CEO and co-founder of Grassroots Cannabis.
Collins, the moderator, spoke at the start of the event about how quickly momentum is building for cannabis law reform, in states as well as in territories.
“Why do you think that is? Well, there’s certainly a grab for the business revenue,” Collins said. “A huge amount of money is coming into this market, just for investment purposes, but also to start reaping some of the profits that are out there.”
During the public hearings in Guam in late 2020, speakers often emphasized the topic of vertical integration, where a split in opinion emerged. Some were in favor of allowing a single entity to own licenses at each stage of the supply chain, while others feared such a move would inevitably allow a handful of companies to control the industry. That topic of vertical integration came up on Friday, too. Williams pointed out that while there are no proposed regulatory limitations on the number of licenses that can be issued as far as retail or cultivation, there are proposed limits on vertical integration and the number of licenses one person can own.
Khan said, regarding the lack of limits on licenses, that while it might sound “a bit un-American” to some, programs that didn’t have limitations on the number of licenses, like Oregon and Washington, “have been a bit of a disaster and have been uncontrollable, unregulated, and nobody’s been able to make money.”
Morinaga, chair of the Guam Visitors Bureau, laid out why some are split on cannabis when it comes to tourism.
“For the travel industry portion who are very negative,” Morinaga said, it’s “because that will ruin our tourism business. That is the highest revenue income for Guam.”
Morinaga explained the Bureau’s own philosophies on cannabis, and why medical use is seen as different from adult use, and the specific tourism considerations based on who visits Guam.
“We are for medical use, we’re not against that,” Morinaga said. “When it came to recreational use, that was a very controversial topic. And we did make a statement on why this should not be publicized openly, because our source market in Guam is from East Asia,” Morinaga added, primarily Japan, Korea and Taiwan, “and to them, cannabis or marijuana is a very sensitive issue.”
Morinaga said that he is keeping a close eye on the final stage of adult use cannabis rule-making because “we need to communicate and be transparent” with countries like Korea and Taiwan that have strict rules against cannabis sales or possession, and it’s important that these tourists know that they can’t buy cannabis in Guam and bring it back home.
It’s also unlikely that Guam is going to become a sort of Denver of the Pacific, marketing new types of cannabis events for people who are looking for a sunny, cannabis-packed vacation.
“I don’t see any big revenue coming from the tourists to purchase cannabis. That’s the conclusion,” Morinaga said. “And if we promote cannabis to make tourists come to Guam to get high, or to smoke, it’s not the right way to market Guam.”
Williams laid out where Guam’s adult use rules stand. Regulators released rules, held public hearings for feedback, sent the proposal to the governor’s office as the law required, and then to the attorney general’s office for review and compliance with existing laws. The attorney general’s office is, today, offering amendments for regulators to address, and once those are “deemed to be sufficiently addressed,” Williams said, the office will approve the revisions, and then send the adjusted rules to the legislature so they “can have their own hearing on it and hopefully pass the rules as amended.”
Williams said that when regulators crafted these rules, they looked at other jurisdictions to see what worked and what didn’t, and that there was a “good amount” in the proposed rules that was “adopted from Washington.”
“But I don’t think there’s one particular jurisdiction that was the perfect fit where we could cut and paste for ourselves. It had to make sense for Guam,” she said.
Williams addressed head-on what some in Guam’s cannabis industry, and hopefuls, have expressed: what’s taking so long?
“Now, we haven’t moved along in that process as fast as anyone would like, including ourselves, for many reasons. It’s not just the review and the adoption and consulting with the various agencies who are going to be in charge of actually enforcing these rules. But then there are also just the competing priorities of government. And I can appreciate that,” Williams said.
The biggest of the “competing priorities” is COVID, Williams said, and the financial fallout of the ongoing pandemic. And, two agencies who are standing up the new industry are Public Health and the Department of Revenue and Taxation.
“You’d have to be under a rock to not know that they’re incredibly swamped and overburdened these days,” Williams said.
