New Mexico Cannabis Sales Hit $40 Million in July

State officials in New Mexico announced this week that sales of regulated cannabis topped $40 million in July, setting a new record since legal sales of recreational pot began in the state earlier this year. The Cannabis Control Division of the Regulation and Licensing Department noted the figure tops the monthly purchases of regulated cannabis recorded every month since April, when licensed sales of recreational weed kicked off in the state.

During the month of July, licensed retailers throughout New Mexico reported more than $40 million in cannabis sales, with sales of adult-use cannabis alone topping $23 million. Cannabis sales totaled more than $39 million in April, the first month of legalized recreational sales and the state’s previous record high, with April adult-use sales totaling just over $22 million. New Mexico Governor Michelle Lujan Grisham said that the figures show that a strong market for regulated recreational marijuana is being created in the state.

“These numbers show that the impressive sales generated in the first month of legalized recreational cannabis sales were no fluke – and this is only the beginning,” Lujan Grisham said on Thursday in a statement from the governor’s office. “We’ve established a new industry that is already generating millions of dollars in local and state revenue and will continue to generate millions more in economic activity across the state, creating thousands of jobs for New Mexicans in communities both small and large.”

State officials noted that the strongest sales of cannabis were reported in New Mexico’s most populated areas including Albuquerque, Santa Fe, Las Cruces, Hobbs, and Rio Rancho. Albuquerque saw the highest cannabis sales in the state, with combined adult-use cannabis and medical marijuana purchases topping $14 million in July. Santa Fe was next in line, with just under $3.5 million in combined sales last month. Sunland and Hobbs, two cities on the border with Texas, where recreational pot is still illegal, each recorded more than $1 million in adult-use cannabis sales.

New Cannabis Products Helping To Drive Sales

Rusty Poe, the manager of Sol Cannabis in Las Cruces, told local media that sales at his shop keep increasing.

“Sales have actually been steadily increasing for us, the more product we bring in the more sales we have,” said Poe, noting that new products on the dispensary menu including cannabis-infused beverages and edibles have helped fuel the uptick in sales.

New Mexico Cannabis Chamber of Commerce Executive Director Ben Lewinger said that the state’s cannabis sales figures are a victory for New Mexico and its growing industry.

“I couldn’t be prouder of my home state,” said Lewinger. “The Cannabis Regulation Act presented what felt like an impossible timeline to stand up a brand new adult use cannabis industry, yet here (we) are – four months into legal cannabis for folks over 21 and we have record sales, for not only adult use but also our cherished medical cannabis program. …Best of all, no one city or county owns this success — the industry will continue to grow across the entire state.”

Since regulated sales of adult-use cannabis began in April, dispensaries have rung up more than $88 million in recreational pot sales. The Cannabis Control Division releases sales numbers monthly, with data made available at the beginning of each month for the previous month.

New Mexico’s rising sales of adult-use cannabis are a boon for the public coffers as well as the state’s cannabis industry. New Mexico Taxation and Revenue Department spokesman Charlie Moore said cannabis excise tax returns totaled close to $2.5 million in June. The amount of tax generated by sales of cannabis in July will be released by the agency in late August.

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New Mexico Recreational Pot Sales Surpass $3 Million in Opening Weekend

Three days and millions of dollars later, the New Mexico adult-use cannabis industry is off to a roaring start.

Local television station KOAT reports that, as of noon on Sunday, recreational pot sales in the state had eclipsed $3 million.

The station, citing state officials, said that 49,552 transactions for recreational cannabis transactions had been recorded at that time, which totaled $3,092,712.

Sales officially kicked off after midnight on Friday, when hundreds of eager customers lined up outside the dispensaries in anticipation of the historic opening.

New Mexico is the 18th state to legalize recreational pot use for adults after its Democratic governor,  Michelle Lujan Grisham, signed a bill into law last spring.

“The legalization of adult-use cannabis paves the way for the creation of a new economic driver in our state with the promise of creating thousands of good paying jobs for years to come,” Lujan Grisham said in a statement at the time. “We are going to increase consumer safety by creating a bona fide industry. We’re going to start righting past wrongs of this country’s failed War on Drugs. And we’re going to break new ground in an industry that may well transform New Mexico’s economic future for the better.”

From the start, Grisham has hailed legalization as a force for economic prosperity in the state. After signing the legislation into law last year, her office said that “sales of adult-use recreational cannabis could amount to $318 million in the first year, creating over several years what could be more than 11,000 new jobs.” Her office added “that the excise tax will raise at least $20 million for the general fund in the first full fiscal year, with significant growth in subsequent years.”

“As we look to rebound from the economic downturn caused by the pandemic, entrepreneurs will benefit from this great opportunity to create lucrative new enterprises, the state and local governments will benefit from the added revenue and, importantly, workers will benefit from the chance to land new types of jobs and build careers,” Lujan Grisham said in a statement after the bill signing.

“This legislation is a major, major step forward for our state,” the governor added. “Legalized adult-use cannabis is going to change the way we think about New Mexico for the better — our workforce, our economy, our future. We’re ready to break new ground. We’re ready to invest in ourselves and the limitless potential of New Mexicans. And we’re ready to get to work in making this industry a successful one.”

As recreational pot sales launched throughout the state on Friday, Lujan Grisham visited a dispensary in Albuquerque.

Local television station KRQE reported that the governor “didn’t buy anything herself,” but did spend about a half-hour at the store conversing with customers and employees.

“I’m excited, this is what New Mexicans said they wanted,” Lujan Grisham said, as quoted by the station. “They said they wanted it long before was I running.”

While she didn’t procure any bud to take back to the governor’s mansion, Lujan Grisham didn’t rule out a purchase in the future.

“I don’t have to decide today, because it’s not going to end today. It’s going to stay forever,” she said, according to KRQE.

According to local television station KOAT, more than $4.5 million in total cannabis sales had been reported in New Mexico last weekend, including medicinal cannabis.

On Friday, there was $1.96 million in recreational cannabis sold in New Mexico, according to the station.

“By noon Friday, recreational sales had reached $476,000. About 70 percent of all cannabis sales Friday were for recreational use,” the station reported.

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New Mexico Cannabis License Raises Eyebrows

A lucrative cannabis producer license that was issued by the New Mexico Department of Health with little notice only days before the agency lost its regulatory authority is raising eyebrows. Some of the state’s marijuana industry insiders are calling for an investigation into the affair amid allegations of favoritism.

The license awarded to Albuquerque-based GH LLC came less than a week before the health department ceded authority over the state’s Medical Cannabis Program (MCP) to the state’s new Cannabis Control Division, which was created following the legalization of adult-use cannabis by New Mexico lawmakers in April. The license, the first awarded by the health department in six years, was issued following a short, unannounced application period in June.

“This new licensee process has certainly ignited a fair amount of distrust, raised eyebrows and questions,” Duke Rodriguez, president and CEO of New Mexico Top Organics-Ultra Health, the state’s largest medical cannabis business, told the Santa Fe New Mexican last week.

“There are a number of good folks who have invested time, effort and resources while not knowing there might have been an express lane,” he said.

License Awarded After Unannounced Application Period in New Mexico

On June 23, only days before the Cannabis Control Division of the state Regulation and Licensing Department took over marijuana regulation, the health department posted a notice on its website titled “Medical Cannabis Licensed Non-Profit Producer Application Instructions.” No official notice that applications were being accepted was issued, however, although an online application listed a June 28 deadline.

According to documents obtained under a public records request, on June 25, only two days after the application instructions were posted, GH LLC submitted a 731-page application for a nonprofit medical cannabis producer license. On Sunday, June 27, Dominick Zurlo, director of the MCP, and Billy Jimenez, general counsel and deputy secretary of the Department of Health, visited the GH LLC facility in Alburqueque to perform an inspection. One day later the “legacy” producer license was issued by the department for a fee of $10,000.

“In my opinion, this was a dirty affair,” said Willie Ford, managing director of Reynold Greenleaf & Associates, a consulting firm for cannabis businesses. “This was obviously somebody making it happen for somebody else.”

Health Department Responds to Questions

Department of Health spokeswoman Baylee Rawson said that the department “often posts announcements through the website,” adding that the site is visited frequently by medical cannabis license holders and patients.

“It is also one of the primary methods used to present information and updates about the program including meeting announcements, patient statistics, educational materials and other reports and documents,” Rawson wrote in an email.

Rawson also wrote that for several months, the Department of Health had been working “on opening licenses for additional licensees to help ensure patients had additional options for obtaining their medication.” When asked about the Sunday inspection during the narrow application window, Rawson said that, “It is not unusual for MCP staff to work on weekends due to the high workload and demand for services.”

Emails obtained through the public records request show that after the transfer of responsibility for the Medical Cannabis Program, decisions regarding the GH LLC application were made by top officials at the Cannabis Control Division. In August, acting deputy director of business operations for the division Nicole Bazzano asked health and safety specialist Joshua Wilson for an update on the status of the application.

“It’s my impression that they are just waiting on the inspection from you in order to start producing/manufacturing, is that correct?” she wrote. “What can we do to get them taken care of and up and running properly and legally?”

The following day, Wilson replied that he “had to go back and do a bit of research on this one” and that he “largely” had no information on the approval of the license.

“The processing, inspection and approval were done at a level above MCP License and Compliance staff,” he wrote. “After looking at the approval letter, it does appear that they were issued some form of conditional approval allowing for the completion of infrastructure and requiring re-inspection before being allowed to cultivate, manufacture, or distribute.”

The ‘Mack Daddy of Licenses’

Rodriguez of Ultra Health characterized the license awarded to GH LLC as the “mack daddy of licenses.”

“You’re the vertically integrated license that allows you to do everything—produce, manufacturing—you can do all those things,” he said. “The new approach under the [Cannabis Regulation Act] makes you subject to having this silo effect. You have to get a license for manufacturing. You have to get a license for retail. You have to get a license for production.”

Medical marijuana advocate Larry Love, the host and producer of Santa Fe-based Medical Marijuana Radio, said that he knows “plenty of people” who would have applied for the medical marijuana producer license had the application period been publicized by the health department in advance.

“It just doesn’t seem fair to the public, knowing that someone was able to get a license ahead of everybody else,” said Love.

But in a brief interview last week, GH LLC founder Vance Dugger apparently shrugged off the controversy over the license, saying “We submitted an application like everyone else.”

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