Sam Littlehale has quick-talking confidence and pulled-back, blond hair.
He got his start in recreational marijuana retail in Washington. Now he’s the CEO of Montana Cannabis Company in Missoula, where he provides patients with medical marijuana.
A new regulatory framework will hit Montana medical marijuana providers in 2018. Gov. Steve Bullock signed the Montana Marijuana Bill, also known as SB 333, in May.
Littlehale is waiting, along with others in the industry, to see how the new laws will affect his business.
The new laws will require providers to send their product in for lab testing. Providers will pay a quarterly, 4 percent tax that will decrease to 2 percent after the first year. They will also have to track their growth with a seed-to sale program.
The Montana Department of Health and Human Services released a notice in the Nov. 9 federal register announcing a public hearing on 20 new proposed rules. If finalized, the rules will help flesh out the framework set up by the new medical marijuana bill.
The public hearing on the adoption of these rules will be held on Nov. 30 in Helena. Providers will know more about what to expect when the rules are finalized.
Littlehale is not sure what the required seed-to-sale program will mean for his business.
In Washington, Littlehale said seed-to-sale tracking was required. He said that in a full tracking program, cameras would be required on every square foot of his property.
The only room in his previous place of work without a camera was the bathroom.
Seed-to-sale tracking software is designed to help keep medical marijuana off the black market.
Each plant has a barcode with a unique, 16-digit identification number. Software keeps track of every plant like a stalker. The plant is followed from the seed, to the cured product, to its final home with the medical marijuana patient.
The proposed new rules put out by DPHHS do not mention that cameras will be required for Montana’s Medical Marijuana seed-to-sale program. They do require that each plant and all its movements are tracked and recorded with the state’s chosen software.
Littlehale said he currently runs a delivery business. This allows him to be very committed to getting his products to his patients quickly.
He is prepared to move to a storefront location if he’s not able to efficiently deliver under the seed-to-sale program.
The proposed rules would require that each delivery be electronically entered at the end of each business day.
Littlehale said that the new laws will give his business more legitimacy.
“No other medicine in the country is allowed in production without some oversight and quality control,” he said.
Elizabeth Pincolini agrees that the new laws will be a good thing for business.
Pincolini is the owner of Alternative Wellness in Billings, Montana. Her business helps patients get medical marijuana cards, and matches them with doctors and providers.
She said the mandatory testing for contaminants should help patients get higher-quality medicine. Right now, products are only tested for potency. Molds and other potentially harmful things could squeak by.
The proposed DPHHS rules set out a list of contaminants that may be tested for. These contaminants include heavy metals, and pesticides. If any of the batches tested reach unacceptable levels, the product will fail testing.
Joe Arnone is in his first year of growing medical marijuana in Montana. He’s uncertain about what the new laws will mean for small operations like his.
He feels like everything is changing so fast that he’s having trouble keeping up with it all, but the new laws do have a few provisions that will help smaller providers like him.
Right now, Arnone has fewer than 10 patients. The new laws say that providers that have less than 10 patients don’t have to test their product until 2020. He’s considering deliberately staying under the patient cap.
In the future, Arnone may have to hire people to help him with the seed-to-sale program, or pay to have his product tested. Under the proposed rules, if a product fails testing, it will be re-tested by the same lab. If it passes retesting, it’s sent to another lab for backup testing.
The provider would be on the hook for the costs of retesting.
Arnone said that if the laws continue to become more restrictive, he’s not sure if he can stay in business.
Sen. Mary Caferro sponsored the new medical marijuana bill. She said the new laws will ultimately reduce uncertainty, and improve things for the industry.
According to Caferro, a letter sent out by the Obama administration before the bill was drafted indicated that states without regulatory frameworks would face federal shutdown.
Caferro said that before the new laws, Montana had no regulatory structure.
“There was no regulation at all,” she said. “There was nothing, zero.”
Montana experienced federal shutdown of its previous medical marijuana program in 2011. Without any true regulatory framework, wide-scale corruption was growing in the greenhouses along with the plants.
Caferro believes that the new laws will keep Montana’s providers from having to experience the fear and uncertainty of facing potential shutdown.
“Senate Bill 333 puts in a regulatory framework for the medical marijuana program that is transparent, safe, contained, and functional,” she said in a house taxation committee meeting on April 6.
DPHHS spokesman Jon Ebelt said there will be public comment and legislative oversight while the agency makes rules to carry out the laws laid out in SB 333.
The first public comment period on the proposed new rules opened Oct. 28. People are encouraged to submit any concerns or comments to the Department of Health and Human Services by Dec. 7.