When discussing the cannabis industry, we usually like to discuss the large amounts of money that dispensaries make. Often overlooked, however, are the extremely high fees that many dispensaries pay the state to stay open, such as licensing and permit fees. It is actually very expensive to start a marijuana dispensary; and in Maryland, it stands to be even more expensive.
According to The Baltimore Sun, the Maryland Medical Marijuana Commission is tentatively proposing a jaw dropping $115,000 a year fee for medical marijuana growers. If you were able to pick up your jaw, be prepared to drop it again because the commission also wants to charge dispensaries $40,000 a year on top of a $6,000 application fee.
The commission justifies the exorbitantly high fees as an effort to take the cost of running off of the state. “It is simply a reflection that the General Assembly has put the operation of this on the growers and the dispensaries, and ultimately upon the patients,” Eric E. Sterling, a member of the commission, said. “There is no taxpayer money, according to the General Assembly, that is going to finance this,” he added.
The commission estimates that Maryland’s medical marijuana program will attract roughly 45,000 patients and would cost around $3.5 million a year to run. While most states are happy to foot the bill to run the program, it seems Maryland believes that sick people should ultimately have to pay for it.
At least one member of the commission voiced concern over the fees. “They’re high,” Deborah R. Miran said. “Maybe in some cases, for smaller growers, smaller operations, they could be prohibitively high.” Indeed theses high fees could muscle out smaller competitors and only leave deep-pocketed special interests in the market.
If theses ridiculously high fees are approved, competition will be driven out of the market and you will start to see prohibitively high prices like in Washington, but much worse. There will only be an estimated 45,000 patients particpating and that is not enough demand to help offset the growing or dispensary fees. The high cost of production plus the low demand is going to skyrocket the price of marijuana to prohibition levels.
Even though there will be fewer potential patients than in California, for example, these high prices will hurt the patients this program is supposed to help. Terminally ill people typically don’t work 50 hours a week and make hundreds of thousands of dollars; they rely on the help of friends and families. To place such a heavy burden on sick people and their families is selfish and disheartening.
The commission will reconvene October 16 for a final vote on the matter; hopefully they do the right thing and strike down the excessive taxes and fees; otherwise, Maryland’s medical marijuana patients, and the industry itself, might just find themselves worse off than before.