Recreational Cannabis One Year Later -

On January 1st of 2022, recrecational marijuana stores opened for business in Montana.

Now, with 14 months of recreational sales to look back on, we wanted to take a look at one of Montana's most lucrative new industries.

In November of 2020, Montana voters passed ballot Initiative I-190, legalizing recreational marijuana for those 21 and older in Montana, by a 57% to 43% vote. In 2021, the Legislature approved House Bill 701, which set up the framework for the recreational cannabis industry, which includes all marijuana related products.

The bill established what are now referred to as "green counties" where the November 2020 vote saw over 50% of votes in favor of I-190, and "red counties", where over 50% voted against. Cannabis stores would be able to open in green counties, while stores would not be able to operate in red counties, setting the stage for "dry counties," reminiscent of the American South where some areas are still not able to sell alcohol.

Residents age 21 and older in all counties are still able to own, transport, and consume cannabis products, as well as grow their own.

While Powder River County voters voted 430 to 667 against I-190, our neighbors to the west in Rosebud County voted in favor of the initiative by a slim margin, 1886 for, and 1850 against.

The law stipulated that recreational marijuana would become legal in the state as of January 1, 2021, with recreational stores opening on January 1 of 2022, enabling the state time to set up a system for regulation, taxation, and inspection of medicinal stores.

In order to better understand the industry, we thought we'd pay a visit to our neighbors in Ashland to see how life is going in a location where recreational stores are legal.

TJ Trusler of High Mountain, a cannabis store in Ashland, spoke to us during a recent visit.

High Mountain is one of three different businesses in Ashland which sell recreational as well as medicinal cannabis. Ninepipe Organics expanded from a medicinal dispensary to include a shop in Bozeman. Bloom touts 21 stores spread across the state.

High Mountain came about when TJ's dad, Tom, who operated a medicinal marijuana dispensary, teamed up with a group from Hardin to open the company, which has now expanded considerably.

In addition to their shop in Ashland, High Mountain also has a store in Hathaway, in Rosebud County located along Interstate 94 between Forsyth and Miles City, as well as stores in Glendive and Billings, and will soon be expanding to Sidney, with plans for other stores in the future.

High Mountain currently employs six full time employees in Ashland, a boon to the small community of 773 (this number, generated from US Census data, includes St. Labre). Statewide, an estimated 5,000 jobs are supported by the marijuana industry.

TJ and Tom are both Broadus grads, and still ranch in western Powder River County.

Entering the store, a customer walks into a clean and well-lighted place, as Ernest Hemingway would write. Knowledgeable staff are on hand to answer any questions, and potential customers are made to feel at home. While we were at the store a nearly steady stream of customers came and went, carrying sealed bags of cannabis products out the door.

A variety of cannabis products are available, from traditional marijuana flowers to CBD products, edibles, vape products, and cannabis infused lemonade.

TJ's official title of Chief Compliance Officer for High Mountain requires him to travel around to the company's various stores and their grow facility to ensure the company is keeping up with all state rules.

He told us that when the store in Ashland first opened last summer, he heard some grumblings from locals about a "weed store" in Ashland. Since then, some of those same folks have become customers at the store, according to Trusler.

We attempted to contact Rosebud County Sheriff Allen Fulton several times via phone and email to see if his department had seen any change in marijuana related incidents or crime related to recreational marijuana, but did not hear back.

We posed the same question to Powder River County Sheriff Devin Boman, who told us that his department has been handling marijuana on a case by case basis, and learning as they go while following the state laws as written. He is also regularly in touch with the courts and District Attorney to stay on top of how the new laws are being interpreted.

The growing pains involved with interpretation and enforcement of new laws are certainly a challenge for law enforcement and the legal system.

For example, an open container of marijuana in a vehicle is legally treated much the same as an open alcohol container. Field sobriety tests may help indicate whether a driver is intoxicated, as driving under the influence of pot would carry similar penalties as driving under the influence of alcohol. One main difference is because there's not a breathalyzer type test for cannabis, enforcement becomes a more challenging task.

Boman told us he has had some support from the Eastern Montana Drug Task Force in helping to identify specific issues to enforce the marijuana laws, but his department has seen limited help from other state enforcement entities.

Powder River County Justice of the Peace Cathy Landa told us that her office has seen limited cases dealing with cannabis since the new laws went into effect.

"The courts are reactive, not proactive. We apply the law when cases come across our desks, but thus far we haven't seen a lot of cases to see how things will play out," she commented.

According to the Montana Department of Revenue's Cannabis Control Division, which provides oversight for the industry, from January of 2022 when recreational stores first opened to February 27th of 2023, $328,510,417 worth of cannabis sales were completed in Montana, garnering $49,821, 178 in taxes.

Those totals do not include the local option tax. Rosebud County voters passed a resolution for a 3% tax on cannabis sales in the June 2022 primary, with voters overwhelmingly in favor of the tax by a vote of 1,345 to 290. Since the tax was implemented in the seven months from July to the end of January, Rosebud County has made roughly $44,000 in revenue through the local 3% tax. Sales have increased steadily in Rosebud County, with nearly $260,000 in total sales during the month of January.

In speaking to the Rosebud County Commissioner's Office, the tax distribution from sales will go into the county general fund. The way the law is written, 50% of the tax is retained by the county, while 5% goes to the state for administration fees. The remaining 45% is administered to local municipalities, but due to the fact that Ashland is considered a Census Designated Place those funds stay at the county level.

As a matter of comparison, Yellowstone County, which also has a 3% tax, had over $4.2 million in sales in January, with the county gaining over $126,000 in tax revenue in January from cannabis sales.

Nearly $25 million in sales were conducted statewide last month.

Currently, 28 counties including Powder River County are considered red counties. Though red counties do not see any local tax revenue generated directly to the county, the 20% tax rate on recreational cannabis, and 4% from medicinal are distributed at the state level to a variety of funds. These include an account for addiction and treatment, a fund for Fish, Wildlife, and Parks for wildlife habitat, and other funds including the state's general fund.

Bills currently in the legislature seek to update a variety of rules within the marijuana industry. House Bill 462 seeks to adjust some of where that funding is allocated, cutting down the amount to FWP. HB 128 seeks to extend the moratorium on which Montana companies maintain control of the industry and further establish their businesses before companies from outside Montana are able to operate. Both bills are currently working their way through the House.

In January of 2023, Representative Tanner Smith of Lakeside introduced HB 265, which would have prohibited an adult use dispensary in precincts where a majority of voters voted against I-190 in 2020. That bill was tabled in committee on January 31st.

Meanwhile back closer to home, TJ tells us that High Mountain is using their success to reinvest in the local community. Plans are currently in the works for a block party type community event, hosting non-profits and businesses from the area as well as local vendors, with a goal to help promote the Northern Cheyenne Food Pantry.

Local electors in a municipality or county may hold an election to flip from a red to green county. Dawson County voters approved just such a vote, and have since made $190,000 in local tax revenue.

TJ commented on the crew that works at High Mountain in Ashland: "We're really a team of educators. One example of that would be helping to explain the positive benefits to cannabis, such as pain relief. We're here to help make positive impacts in our community."