It was unusually warm for late September, but Buddie didn’t seem to mind.
As the mascot for a plan to legalize marijuana in Ohio, Buddie has a superhero’s physique, a green bumpy head, and a winning smile. Despite the heat, the woman on Buddie duty stood in the Oval, the center of academic life at Ohio State, and posed for selfies with students, as campaign workers registered young Buckeyes to vote.
An operative named Nick Kish asked two giggly students if they’d heard of ResponsibleOhio, the political action committee behind a campaign that would deliver legal pot to the Midwest and a windfall to the investors funding it. Have they heard good things? Bad things? A bit of both.
“All the negative you’ve heard centers around us being a proposed monopoly, right?” Kish asked, then offered a perspective that anyone involved in Colorado’s legal marijuana industry would consider wildly misleading.
Colorado, where there are more than 1,000 licensed marijuana growers, has created a “gray market.” “They grow it legally and then sell it illegally,” Kish says. “So, the state’s missing out on the tax revenue.” (Colorado is on track to collect $125 million in marijuana taxes this year.)
“You can’t monitor a thousand growers. You’ve got people growing just a few plants in their garage, in their basement, whatever. Stuff is being sold with pesticides, bird shit, mold, spider eggs.” The ResponsibleOhio plan, Kish said, would allow only 10 farms in the state, “but it’s solely to make sure it doesn’t fall into the wrong hands.” The students appeared convinced–though they were even more convinced that they didn’t want to talk to a reporter.
Kish then offered similar talking points to Tarak Underiner, a second-year undergrad studying international business. Ohio’s pot farms, Kish said, are “all going to be state-of-the-art facilities.”
“And they’re all going to be owned by the same parent company?” Underiner asked.
Kish clarified that they would be owned by 10 separate companies. There are “too many socioeconomic benefits to this,” he said. “Unfortunately we needed to find a way to step in when the state legislature won’t.”
Underiner says he supports legalized pot but is still leaning towards a no vote. “Anybody who wants to grow commercially should have that option to open that business,” he said. “If you do legalize it for 10 farms, obviously they’re going to make a lot of money. You can use that money to then fund a campaign to restrict other commercial growers. Why would you want competition?”
And there, articulated in the bright early fall sunshine, was the crux of Ohio’s legalization struggle.
Nationwide, the push to legalize cannabis has great momentum. Twenty-three states allow medical marijuana, and last year, Oregon, Alaska, and Washington, D.C., joined Colorado and Washington State in legalizing recreational use for adults. Cannabis activists and businesses can’t wait for election day 2016 when several states, including California, Massachusetts, Nevada, Arizona, and Maine, could vote on recreational, while another few could open up to medical use.
Legal marijuana is, by some estimates, the fastest growing industry in the country with $2.7 billion in sales last year. If Ohio votes yes on the ballot proposal called Issue 3 next month, it would be the largest state to fully legalize and open a new market, with 8 million potential adult customers. Moreover, legal pot taking root in the quintessential heartland swing state would also serve as the strongest indication yet that nationwide legalization is inevitable.
So why do so many cannabis advocates oppose it?
The plan, designed and spearheaded by an Ohio political consultant named Ian James, would work like this: An amendment to the state constitution would permit commercial marijuana growing on 10 predetermined plots of land, each owned by a different company. The companies would be competing with each other, but together they would have exclusive access to a market that ResponsibleOhio estimates will top $1 billion annually. To get in on the action, each company had to contribute $2 million to ResponsibleOhio’s campaign to get the proposal on the ballot–it needed more than 300,000 signatures–and be approved by voters. (This provides the bulk of the campaign’s funding, though they’ve received contributions from other supporters.)
It’s not just the growers who would benefit. Responsible Ohio estimates that each farm would create 300 jobs. Plus, ordinary citizens could apply for licenses to manufacture cannabis-infused products like lotions and cookies, and run the 1,000-plus retail pot shops. However, the 10 growing companies would maintain their farms indefinitely, with the caveat that the state could add growers beginning in year four if the existing farms fail to meet market demand. Green-thumbed Ohioans could also maintain a small garden for personal use.
Investing in the ResponsibleOhio plan didn’t require any agricultural experience, and the 23 investors in the 10 companies sound like the cast of a Tom Wolfe novel. They include a fashion designer, NBA Hall-of-Famer Oscar Robertson, scions of a political dynasty, an alumnus of the boy-band 98 Degrees, an NFL defensive end, and a charismatic financier-slash-minister who described the opportunity as a “tsunami of money” in an online video that has been taken down.
“I just think it’s wrong that marijuana is illegal,” says Woody Taft, a ResponsibleOhio investor, whose great-great-great uncle was U.S. President and Supreme Court Chief Justice William Howard Taft. He says marijuana should be taxed and regulated, which will also accelerate research on medical marijuana, a common view among legalization supporters.
“Yes, we stand to profit by it, but that’s not the reason most of us are here,” Taft says. “I feel like I’m doing the state a lot of good.” He and other investors point out that they’ve already risked $2 million to enter the business, and will risk considerably more constructing growhouses that the federal government can still shut down. Limiting the number of farms to 10 will help ensure proper regulation, he says. “I understand people’s criticism that it’s not 10 so much as why us 10, but the direct answer is that we believe we’re doing this responsibly.”
James, the political consultant, describes Issue 3 as a response to a state legislature that is too obdurate or dysfunctional to do the people’s will. According to a 2015 poll, 84% of Ohioans believe medical marijuana should be legal, and 52% want to legalize possession for personal use. But medical marijuana initiatives have arisen in the Ohio legislature since the 1990s and have gone nowhere.
This year, in response to Issue 3, the state legislature shot back with Issue 2, which Ohio voters will also decide in November. Issue 2 would amend the state constitution to block “any petitioner from using the Ohio Constitution to grant a monopoly, oligopoly, or cartel for their exclusive financial benefit.” If, somehow, both measures pass, the issue with the greater vote total will prevail, according to the state constitution, though the dispute could end up in court.
Under most circumstances, marijuana entrepreneurs and activists favor anything that accelerates legalization. But Issue 3 has disrupted their comfortable alignment. The National Organization for the Reform of Marijuana Laws (NORML) endorsed Issue 3, though the group’s legal counsel wrote that it “surely does feel like the loss of innocence.”
Two of NORML’s most prominent allies, Marijuana Policy Project and the Drug Policy Alliance, have declined to endorse Issue 3. Ethan Nadelmann, executive director of DPA, says it would “do a tremendous amount to advance the national movement to end marijuana prohibition.” But it “seems un-American and it would set a bad precedent. I’d hate to see this model replicated elsewhere.”
Even if it fails, Issue 3 models how to cut a portion of the marijuana community–growers–out of owning the industry they’ve created and fought for just as the legal money arrives. Kris Krane, managing partner of a marijuana consultancy called 4Front Ventures, says Issue 3 “has nothing to do with marijuana; it has to do with the ability of rich people to not just buy an election but to buy themselves an oligopoly.” He also worries that as more states open up, the Ohio growers, due to their size, would be well-placed to dominate commercial cannabis in other states.
That is part of the plan. A prospectus that James’s company prepared for ResponsibleOhio investors says: “Clearly marijuana legalization is coming . . . being able to replicate this victory elsewhere places Principle Funders in a stronger position for [return on investment] in other ventures. In short, if it works here, it will work anywhere, which follows the old saying, “As Goes Ohio So Goes the Nation.”
Even Buddie the mascot has become a source of rancor. Cannabis companies are in the tadpole stage of a nationwide charm offensive. They think they can sell the public on cannabis as an alternative to products as diverse as alcohol, health supplements, and various over-the-counter and prescription medicines. Given the potential, they don’t want anything to do with the cartoonish figure that has attracted comparisons to Joe Camel, the late, unmourned tobacco spokes-mammal. Buddie, they say, plays into the hands of their opponents who warn that Big Weed will become an entrenched corporate interest like Big Tobacco or Big Oil.
James and his husband and business partner Stephen Letourneau dreamed up Buddie to attract millennial voters. They asked themselves: “What is something that people would say, “Holy shit, that’s irreverent!”?
“Buddie doesn’t target kids,” James says, “Drug dealers target kids.” Still, in deference, Buddie only appears on campuses and at events for adults.
ResponsibleOhio also employs more conventional campaign tactics. In one television ad, “Bring Addy Home,” a mother describes leaving Ohio for Colorado to obtain medical marijuana to treat her daughter’s seizure disorder. Another spot features a retired Cincinnati cop making the case that existing marijuana laws don’t work and waste law enforcement resources.
James, who has a goatee and curses roughly every fifth word, comes from Ohio’s Appalachian southeast. He describes himself as a “classic liberal” who has worked in favor of issues like voter access and same-sex marriage. His firm also developed a 2009 initiative that modified the Ohio constitution to allow four casinos to operate, a strategic precedent for the Issue 3 campaign. If Issue 3 passes, James expects to do well, providing services to the industry he midwifed.
The ResponsibleOhio team brought a green RV to Ohio State. During the campaign, the “cannabus” will visit all 88 Ohio counties. But if a recent unproductive visit to downtown Zanesville is any guide, Issue 3’s success depends on mobilizing collegians. Early voting by mail began this week, which James describes as a perfect fit for the passive student lifestyle. “You can do it from the couch with a beer, or if you have anything else in hand.”
Since marijuana is federally illegal, each state has had to design its own system for regulating cannabis and awarding coveted business licenses. Issue 3 supporters point out that other states’ methods suggest forces other than pure meritocratic capitalism at work. Some states, for example, have weeded out applicants by requiring them to demonstrate cash reserves of hundreds of thousands of dollars or more.
They argue that while predetermining the growers may be off-putting, it’s not so different from cell-phone networks, Internet providers, and everything else in which Americans accept limited options. Lissa Satori, a cannabis activist and entrepreneur in Columbus who supports Issue 3, describes herself as enough of a cynic to believe that every marijuana business license in the country is for sale. “And I’m tired of apologizing to patients.”
“Patient access and decriminalization are a heck of a lot more important to me than who profits from it,” says Brad White, a cannabis activist who works in brand management at the Cincinnati-based consumer-goods giant Procter & Gamble. “The next best option is the status quo.”
(White says he advocates for legalization with permission from the higher-ups at work. The fact that the company that brings us ubiquitous brands like Gillette, Pampers, and Oral-B lets an employee advocate for an illegal drug is itself a a sign of marijuana’s trajectory.)
Opposition to Issue 3 has brought together an unlikely coalition of opponents that includes groups adamantly opposed to marijuana, and activists who want to legalize it in Ohio next year. Mike Curtin, a representative in the state legislature who spent decades covering government for the Columbus Dispatch, says he opposes Issue 3 solely from a governance perspective. Issue 3, he says, is a business plan disguised as a constitutional amendment, “a total abuse, a total prostitution of the state constitution.”
Curtin believes that if ResponsibleOhio had attempted to legalize without inserting the growers into the state constitution, much of the opposition wouldn’t exist, himself included. Such a path wouldn’t provide the same guarantees to the 10 farms, however, and James says it wouldn’t have attracted the funding that a political campaign needs in a big swing state like Ohio.
The constitutional distinction isn’t just academic. The Ohio Society of Certified Public Accountants, which opposes Issue 3, says that as it is currently phrased, the amendment would give a tax break to investors in the pot farms. If Issue 3 passes and the accountants are right, altering that constitution again would require another multimillion dollar campaign like the one ResponsibleOhio is now waging, even if the tax break was unintentional. The same applies to all the language in the amendment, which is more than 6,000 words long.
Both Curtin and James say they expect to win, but with limited public polling, it’s difficult to predict. Generally, legalization supporters prefer to hold votes in presidential election years when more young people go to the polls. But ResponsibleOhio has a paid staff of hundreds identifying its people and making sure they vote. In a low turnout election, that could work to their advantage.
With nothing like those resources, the opposition has high expectations for the sensibility of its argument. “This is not a legalization vote, this is a monopoly vote,” Curtin says. “People smell the rat.”