Oregon has put an indefinite pause on new marijuana licenses.
There are around 2,800 active licenses in the state for the farming, processing or sale of cannabis. Now, some business leaders say the industry is oversaturated, as it can’t export excess products to other states.
Mike Getlin is the Board Chair of the Cannabis Industry Alliance of Oregon. He also works for Nectar, a statewide chain.
“There are just far too many companies that are vying for a very limited market,” said Getlin. “It makes it virtually impossible for the vast majority of Oregon’s small cannabis businesses to be profitable.”
Since June 2018, a series of moratoriums and administrative pauses have temporarily stopped more licenses from being issued.
Now, a new law will permanently tie future licensure to population growth. According to Getlin, the move follows extensive lobbying efforts from the cannabis industry.
Moving forward, Oregon can't issue any new production or retail licenses until there's 7,500 smoking-age residents for every one license. For processing and wholesale, this ratio will need to be 12,500 to one.
Getlin said the rules won’t fix the state's current overcrowding issues. But he said they will ensure that things don’t get worse.
“It allows us to do some long-term planning in a way that frankly we’ve never been able to do in Oregon in the past,” said Getlin, “because we never knew if we were going to suffer another 50% decrease in revenue.”
Mark Pettinger, a spokesperson for the Oregon Liquor and Cannabis Commission, said it could take decades before the conditions for more licenses are met. He said the number of businesses could also decrease over time, through state-surrendered licenses that aren't redistributed.
In the meantime, those looking to obtain a marijuana license will have to purchase an existing business.
