Ohio House Lawmakers Consider Bill to Eviscerate Voter-Approved Cannabis Law

The Ohio House Judiciary Committee is moving forward on considering Senate-passed legislation that aims to rewrite the state’s adult-use cannabis law that voters approved via Issue 2 in the November 2023 election.

Despite a 57% majority choosing to legalize cannabis for those 21 years and older through a licensed, taxed and regulated marketplace in the Buckeye State, Republican lawmakers in Columbus continue to work toward crafting a statute that collides with the will of their electorate.

The legislation, Senate Bill 56, specifically would change the rules around:

• decriminalized acts for adults 21 years and older;
• administrative authorities for state regulators;
• business licenses;
• potency limits;
• testing procedures;
• home grows;
• industry employment;
• hemp regulations;
• excise tax disbursements;
• expungement filing fees;
• advertising restrictions;
• law enforcement; and
• local control, among other provisions.

In February, the Senate voted entirely along party lines, 23-9, to pass its 152-page version of the bill that’s sponsored by Sen. Steve Huffman, R-Tipp City. At that time, the American Civil Liberties Union (ACLU) of Ohio condemned the legislation, suggesting that it would perpetuate the state’s “mass incarceration and punishment mindset” by deleting protections under Issue 2.

This comes 50 years after former Gov. James Rhodes signed legislation making Ohio the sixth state in the nation to decriminalize cannabis.

In particular, the Senate’s version of S.B. 56 would criminalize Ohioans 21 years and older for obtaining personal amounts of cannabis anywhere other than from a state-licensed dispensary or their own home grows—sharing or gifting cannabis would be prohibited. The bill would also place criminal offenses on using cannabis in nonmoving vehicles.

In a May 27 opinion piece published in the Akron Beacon Journal, Karen O’Keefe, the director of state policies at Marijuana Policy Project, explained it this way:

“If you were to pass a joint or share cannabis you grew at home, you would be a criminal. If you smoke in a non-moving parked car or your own backyard? Criminal. If you possessed any cannabis from other states? Criminal.”

O’Keefe also wrote that Ohio lawmakers had years to craft adult-use legislation before Issue 2’s passage, but they failed to do so.

The House Judiciary Committee plans to consider, on June 4, a substitute version of S.B 56 that would scale back some of the upper chamber’s provisions, including the criminalization of sharing cannabis among adult-use peers, which would be allowed at one’s primary residence if the lower chamber’s body gets its way.

The substitute also reinstates a home-grow limit that aligns with Issue 2—six plants per adult and 12 plants per household (the Senate-passed bill would limit households to six plants). And the substitute would allow for pre-rolls to be manufactured and sold in the commercial market.

Although the committee substitute more closely aligns S.B. 56 with the House’s proposed program overhaul, House Bill 160, cannabis industry advocates warn that the updated version would still undermine Ohio’s voter-enacted cannabis legalization law. The substitute also folds in much of a Senate-passed bill that aims to more tightly regulate hemp products.  

The committee substitute would prohibit Ohioans from using cannabis or intoxicating hemp products anywhere except inside one’s private residence or certain outdoor concert venues. It also retains the Senate’s potency limit of 70% THC for extracts (down from 90% under Issue 2). The voter-approved 35% THC limit on unprocessed cannabis flower would remain the same.

Meanwhile, under current law, the state’s 10% excise tax revenue on cannabis sales is supposed to be distributed as follows: 36% to municipalities with dispensaries; 36% to a social equity and jobs program; 25% to education and substance abuse treatment programs; and 3% to the state’s general revenue fund to operate the cannabis program.

While the Senate-passed legislation would retain the same percentages as the voter-approved law, the committee substitute would instead direct all excise tax revenue to the state’s general revenue fund, except for a 25% credit to municipalities hosting dispensaries for seven years. Funding for the social equity and jobs program, for those most impacted by prohibition policies, would be eliminated.

Both the Senate and House substitute versions of S.B. 56 also eliminate Issue 2’s Level III cultivation licenses intended for 40 social equity operators to grow up to 5,000 square feet of canopy.

While the Senate’s version also aims to reduce Level I licensees from 100,000 square feet to 25,000 square feet and Level II licensees from 15,000 square feet to 3,000 square feet of canopy—and have those lower limits fully utilized before requesting approval for expansion—the House committee substitute reinstates the larger canopy sizes to align with Issue 2.

Many of Ohio’s medical cannabis businesses that transitioned to adult-use operations pushed back on S.B. 3’s advancement through the upper chamber in February, including Geoffrey Korff, the founder and CEO of Akron-based Level II cultivator. The company received approval in May to expand to a second, low-cost nursery site to increase production capacity at its main flowering site by nearly 40%.  

Korff asked lawmakers to retain the Level II cultivation of 15,000 square feet, with an expansion of up to 20,000 square feet, under Issue 2 to help ensure that small businesses could compete in the marketplace.

“S.B. 56, as drafted, undermines small businesses, reduces market competition, and disrupts existing industry operations,” Korff told Senate lawmakers in his February testimony. “Adjustments to cultivation limits and sales restrictions are necessary to ensure a fair and sustainable cannabis industry in Ohio.”

While the Senate-passed version places a statewide limit of 350 licensed dispensaries in Ohio, the House committee substitute increases that limit to 400 licenses. Notably, Issue 2 intended for roughly 300-350 dispensaries to be operated by the state’s existing medical cannabis companies and another 50 to be operated by social equity applicants, while providing state regulators the discretion to add more licenses after two years.

Both versions of S.B. 56 place an eight-dispensary ownership cap on operators.

But before moving forward on amending Ohio’s adult-use cannabis laws, Simon P. Dunkle suggested in his February testimony that state lawmakers should put their legislative proposals in a ballot measure and let the voters decide. Dunkle is the executive director of Ohio’s chapter of industry advocacy organization NORML.

“Changing ANYTHING within the Issue 2 Initiative should require that the state of Ohio repost the new Issue 2 on the statewide ballot, for voter approval,” he wrote. “Manipulating the will of Ohio voters goes against everything our system of government stands for or represents, especially the term ‘of the People, by the People, for the People.’”