Rhode Island Pot Dispensary Offers Help with State Budget if Regulators Limit Competition
Regulators are planning to expand the total number of medical marijuana dispensaries from 3 to 15, but the state’s existing dispensaries are not excited about the potential boost in competition.
Published on March 29, 2018

Rhode Island lawmakers are currently planning to expand the total number of medical marijuana dispensaries in the state from 3 to 15, but the state's existing dispensaries are not excited about the potential boost in competition. At a recent meeting with state legislators, a representative from the state's largest dispensary offered to help the state fix its budget problems if, in return, they would agree to back off on the license expansion plans.

Chris Reilly, spokesperson for the Thomas C. Slater Compassion Center dispensary, told the state House Finance Committee that his business is "very sensitive to the state and its challenges… and if there is a way to find the $5 million that you need to plug the budget hole that you need for the coming fiscal year, we'd like to be part of the solution," the Providence Journal reports. Later, however, Reilly clarified that he was not specifically offering to pay off the state in exchange for a promise to limit competition.

In January, Rhode Island Governor Gina Raimondo unveiled a nearly $10 billion state budget for the next fiscal year. Over $5 million of the funding for this budget is expected to come from an expansion to the state's medical cannabis program. The governor's plan involves increasing the number of potential patients by adding "acute pain" to the list of qualifying conditions, adding twelve new dispensaries, and allowing the state's dispensaries to serve customers from nearby Massachusetts and Connecticut.

Seth Bock, CEO of the Greenleaf Compassionate Care Center, told the Providence Journal that adding twelve new dispensaries would "ensure that one, maybe two, dispensaries would go out of business. We've built an infrastructure around a volume of patients which for us, if eliminated, would mean we couldn't operate." Terence Fracassa of the Summit Medical Compassion Center said that the dispensary expansion was unnecessary, as the existing three dispensaries were already successfully meeting the state's demand for medical marijuana.

The Ocean State's medical cannabis industry is also facing a second looming threat, as recreational weed becomes increasingly available on the East Coast. In neighboring Massachusetts, recreational sales are set to start this July. Rhode Island lawmakers have also been pushing their own recreational legalization bills, which could create even more in-state competition for local dispensaries. These plans are at least temporarily on hold, however, while a joint legislative commission studies the ramifications of legalization for the state. This commission must deliver its report by July 1st.

In response to Reilly's request for the state to back off on its dispensary expansion plans, lead medical marijuana regulator Norman Birenbaum said that the expansions to the medical marijuana program are not specifically a capital-raising venture. "From a business standpoint I understand the impulse to continue to protect the market share that they have," Birenbaum told the Providence Journal. He added that the "proposed reforms are not being offered to fill a gap in the budget. They are not being offered to raise revenue or push the industry in a particular direction. They are being offered to address the very real problems we have in the medical marijuana program."

Chris Moore
Chris Moore is a New York-based writer who has written for Mass Appeal while also mixing records and producing electronic music.
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