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The Future Of The DC Cannabis and Magic Mushroom Industries

January 29th, 2024 marks the end of Washington DC’s Medical Marijuana Dispensary license application period for existing Initiative-71 gifting businesses.  Since it’s passage in 2014, over 100 store-front businesses have sprung up across the nation’s capital (as well as many delivery services without storefronts), “giving away” cannabis with the purchase of nominal items, most commonly stickers. Concurrently, 7 licensed and regulated “medical” marijuana dispensaries exist in the city, forced to compete for business with their unlicensed and unregulated counterparts. 

Will unlicensed operators be shut down after the application period expires? Or rather, how soon will enforcement begin and how strict will it be?

DC Cannabis and Magic Mushrooms
Washington DC Residents Legalized Cannabis in 2014 with the passage of Initiative 71.

How Many I-71 Operators Will REALLY Be Granted Cannabis Business Licenses?

DC’s Alcoholic Beverage Cannabis Administration or ABCA (a recent expansion of the Alcoholic Beverage Administration to regulate cannabis businesses) has not stated how many licenses they will be issuing. Instead they provide only a long list of determining guidelines including proximity limits for schools, daycares, playgrounds, and other cannabis businesses, as well as security plans, business plans, and the legal examination of potential owners and their finances. It is possible that operators may apply, providing all their information, only to be targeted for shutdown when their application is denied for legitimate or arbitrary reasons.

Medical Dispensaries and Magic Mushrooms

Initiative 81, passed in 2020, establishes that magic mushrooms and other plant based psychadelics (while all still locally and federally illegal) are law enforcement's "lowest priority."

Unregulated and unlicensed operators have been "gifting" magic mushrooms and their edibles, with many marketing themselves as "I-81 compliant." Under the supervision of the ABCA, operators are only allowed to sell approved and regulated cannabis products, all of which must be grown, produced, inspected and approved in Washington, DC and not across state lines.

Medical Dispensaries and Out Of State Product

Currently, the vast majority of marijuana sold in Washington DC and the rest of the United States is produced in California, with Oregon and Colorado trailing just behind, then smuggled or shipped across the country where it is retailed unlicensed and unregulated privateers. Only in the regulated marketplace is cannabis produced and sold within state lines, under the tracking of local agencies. Smaller states/ jurisdictions like Washington DC have had problems producing enough inventory for their markets, and often lack the quality of the larger producing states where rogue operators are able to grow at greater quanity and quality, and produce more plentiful edible and extract products. Any operator switching from the unregulated market into DC's new regulated system would be regularly inspected by ABCA and forced to sell only cannabis products grown and manufactered in the District, limiting selection and quality for their customers.

How Much Cannabis Is “Made In DC” According To Regulation, And At What Quality?

Whether Washington DC - a district of just 10 square miles with absolutely no agriculture industry - will be able to produce enough cannabis to keep storefronts loaded remains to be seen. And if it can, can it do so at a quality on par with Cailifornia?

How Strict Will Enforcement Be?

What Will Happen To Operators Who Do Not Apply?

Is Cannabis Regulation Necessary, Or Even Good For Consumers? Is It Good For The Public At Large?

Other Legalized States As A Look Into The Future

In 2019, the state of California legalized marijuana for recreational use, opening the door for full-fledged commercialization of marijuana in the state. Since 1999, the state had been allowing the cannabis trade under the auspices of a minimally regulated medical market. Under California's medical marijuana umbrella, from 1999-2018, anyone wishing to do so could get a license to buy, sell, possess and transport up to 100 pounds of marijana at any given time for a mere $1,000 fee. Enforcement was so lax that obtaining the license was unneccessary, with the main consequence of operating unlincesed being the forfiture of inventory. When the state legalized recreational sales, the majority of operators refused to comply with the new regulations. As a result, the majority of cannabis business in California occurs on the unregulated market.

Neighboring States About To Disrupt DC's Market

In 2022, Maryland opened their state for recreational marijuana sales. Virginia also decriminalize marijuana possesion. Combined with the fleeing of suburban employees from DC offices in the pandemic, will Maryland and Virginia suburbanite consumers still even come to DC to buy their marijuana?

DC Cannabis and Magic Mushroom

DC Cannabis and Magic Mushroom


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