(Rebecca Rivas/Missouri Independent)
A trio of research firms who contend Missouri is a poster child for success in the cannabis industry hope to win a contract to study the state’s market closer.
“As it relates to cannabis markets, Missouri is pretty famously the model to follow,” said Mackenzie Slade, CEO and owner of New York-based Cannabis Public Policy Consulting. “So I’m very interested in doing a super deep dive.”
In March, the state issued a request for proposals looking for a vendor to conduct a cannabis market and economic impact study. Currently, Missouri has issued nearly 400 cannabis licenses to operate full-scale cultivation and manufacturing facilities and dispensaries. The state will also eventually have 144 microbusiness licenses, which are limited in size and scope and meant to benefit disadvantaged business owners.
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In 2024, Missouri sold$1.46 billion in total marijuana sales in the state’s second year of adult-use marijuana, outperforming states with a longer history of marijuana legalization like Arizona, Colorado and Nevada.
The results of the study will help the state determine “whether or when the state will be required to issue additional cannabis facility licenses and, if so, how many, where, and of what type,” according to a March press release from the Missouri Department of Health and Senior Services.
Missouri received three responses that fit the requirements of having at least five years of experience specializing in the economic impact of marijuana, or at least 10 years of experience conducting economic impact studies in general.
The responding agencies were Slade’s firm, St. Louis-based Capital Consulting Services and Oregon-based Whitney Economics.
Beau Whitney’s company, which conducts studies globally, gathers data monthly on the cannabis industry for each legal state on business licenses, supply capacity and revenues.
“I have data that goes back multiple years,” he said, “and so I can say, ‘Here’s the progression of the state and its program,’” along with providing future projections 10 years out.
Whitney calls Missouri a “success story.” In one of his recent reports that looked at investment potential nationwide, he found there’s still opportunities for growth, development and investment into the Missouri market.
“And that’s unusual,” he said. “In Oregon where I’m based out of, I just gave an update to the Office of Economic Analysis and I basically said, there’s no investment opportunity in Oregon for any new businesses. Zero for the next 10 years.”
That’s because there’s too much supply, an over saturation of licenses and prices are so low that people can’t make any profit, he said.
“My goal with Missouri is to give them the data that they need to avoid that scenario,” Whitney said.
Slade has seen the same in New York, where her firm has been based for about seven years.
Her company administers a national survey on cannabis use, which essentially measures and quantifies demand behavior for consumers. One of the things that they use it for, she said, at a national level is to try to understand how states are performing based on their policies.
“And Missouri continuously outperforms other states, relative to their date of sale,” she said. “…because they were able to stand up a market so quickly.”
That was in part because Missouri limited the number of licenses to get operational within just a few months. For the study, Slade proposed to use the state’s track and trace data to identify the efficiencies of the licenses.
“That’s a prime example of where we would uncover some extremely important considerations for policy,” she said. “And I do believe that the intent of the study is to identify areas of policy that need to be updated.”
Tracey Jeffries’ company, Capital Consulting Services, has helped governments with economic feasibility studies for 15 years on a state and federal level, and she’s a certified Missouri minority-owned business enterprise as a Black woman owner. According to state policy, winners of any state contract must employ 10% minority-owned and 5% women-owned businesses.
The advantage Jeffries believes she brings to the program is knowing her state and its economy, having led projects throughout Missouri.
“DHSS has done a great job,” she said, “but it’s timely to have the feasibility study because this will benefit the regulators, the businesses, and most importantly to me, in my opinion, the community.”
State law says the cannabis regulators may “lift or ease any limit on the number of [cannabis] licensees or certificate holders in order to meet the demand for marijuana in the state and to ensure a competitive market while also preventing an over-concentration of marijuana facilities within the boundaries of any particular local government.”
Experts generally agree that Missouri’s decision to only issue the minimum licenses allowed under its constitution has been the key to the industry’s boom. However, critics have long argued that the decision created a monopoly that’s kept out opportunities for people who were most impacted by the War on Drugs. While the microbusiness license program was included in the 2022 consutitional amendment to address inequities, the limitations on what these businesses can do make it difficult to turn a profit.
If the department does issue additional licenses, at least half of those licenses must be awarded to owners of cannabis microbusiness facilities that have been operational for at least a year.
The study will also provide information regarding the overall economic stability of the regulated market, including strengths and risks, with a special emphasis on the market’s impact on economically distressed areas of the state.
Jeremy Washington, spokesman for the Office of Administration, the agency that handles contracting for the state, said there isn’t a “published schedule for the completion of the evaluation process.”
However, upon completion of the evaluation process, the MissouriBUYS Bid Board will be updated to reflect the changed status. In addition, the entire procurement file will be published on the Division of Purchasing’s awarded bid and contract document site.
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