Maine lawmakers are considering a bill that supporters say would help reduce the stigma surrounding Maine’s cannabis industry and more closely align its rules with how the alcohol industry is governed.

But state officials have blasted it, saying dozens of pages of proposed regulatory changes arrived too late for close scrutiny, and that the measure would upend the program’s regulatory framework.

The bill, sponsored by Sen. Craig Hickman, D-Winthrop, would make sweeping changes to rules governing Maine’s adult-use and medical cannabis markets, which in 2023 brought in about $493 million, combined. 

Among other changes, the 66-page L.D. 40 would bring the industry more in line with businesses that sell alcohol – requiring ID checks when a sale is made rather than at the door, allowing businesses to employ people as young as 17, and allowing minors to enter the businesses.

The bill would also cut much of the red tape for cannabis operators, eliminating advertising limits, annual employee fingerprint and federal background checks, and strict opaque packaging requirements, and allowing the sale of returned products.

Business owners largely supported the industry-led bill, but state, public health and law enforcement officials said they were left out of the conversation entirely. They criticized the bill for introducing dozens of pages of substantial regulatory changes less than a week before a public hearing, and bumping up against the deadline for action in an already abbreviated legislative session. 

Kirsten Figueroa, commissioner of the Maine Department of Administrative and Financial Services, told members of the Veterans and Legal Affairs Committee Monday that the bill is a “haphazard dismantling of the cannabis regulatory system” that “makes Mainers less safe.” 

“Passing a large, late-introduced amendment to overhaul the statutes that govern both Maine’s adult use and medical cannabis programs and dismantle the regulation and upend the administration of these legal industries would be irresponsible policymaking,” she said. “A proposal this wide-reaching that is rushed through in the final week of committee can’t receive proper due diligence and is guaranteed to create more of the types of legal conflicts that already plague the cannabis statutes.”

Even without what she called the endorsement of the “recreational use of cannabis by children,” the bill would upend the framework governing hundreds of businesses, and that has guided hundreds of municipalities in developing their own regulations, Figueroa said.

“It is not ‘reefer madness’ to acknowledge the precarious legal space that Maine’s legal cannabis programs occupy,” Figueroa said. “We can’t ignore the fact that cannabis is still federally illegal and all the complications that stem from the fact that cannabis is, for the time being, still a Schedule I substance. … Contrary to the assertions laid out in this bill, it is not the role of the regulator to ‘promote’ and ‘advance’ the interests of the industries they regulate. That is the obligation and role of the industry and its trade groups.”

But members of Maine’s cannabis industry say the bill is long overdue.

Matt Bayliss, founder of cultivation company Gele, said the bill is a “beacon of hope” for the industry, which he said has been “suffocating” under burdensome regulations and “desperately seeking breathing room.” 

The bill would reduce the stigma around cannabis business owners, and treat them like any other industry rather than “reckless villains endangering public health,” he said.

Alex McMahan, co-founder and CEO at The Healing Community MEDCo, a Lewiston retail cannabis provider and edibles manufacturer, also stressed the importance of reducing stigma. McMahan helped draft the legislation.

“We have jumped through all the hoops,” he said. “We are voluntarily participating in this regulated program … (and it) feels like we’re under the microscope of the state for no reason.” 

While the state is putting them through the ringer, many of these businesses have been embraced in their communities, said Jacob McMahan, one of MEDco’s partners.

Cashiers selling liquor don’t need federal background checks and annual fingerprinting, and requiring it of cannabis businesses hinders their ability to adapt in a dynamic business landscape, he said.

The bill would also broaden the production capabilities for many industry members. Under current law, license owners cannot produce any items that don’t contain cannabis. For example, Matt Hawes, founder of Novel Beverage in Scarborough, produces THC-infused beverages. His equipment could also be used to manufacture any number of drinks without THC, and there’s great demand for it. But he can’t. Instead, he said, the machines are often quiet during the winter months, when production only runs a few days each week.

“We could be generating revenue off our investments,” he said.

The bill would lower some of the fees imposed on adult-use cannabis businesses for various infractions – some as high as $100,000, a figure Hawes said might put some smaller operators out of business. Fines for medical providers only go up to $7,500.

“Slapping a hefty $100,000 fine on cannabis businesses is like using a sledgehammer to crack a nut. It’s just too much,” said Dylan Ambrose a “bud processor” at MedCo. The fines that can be levied on cannabis businesses are out of sync with those in other industries, he said.

“Lowering the fine structure is not just fair, it’s a necessity to level the playing field and ensure that the punishment fits the offense,” he said. “Let’s dial it down, so businesses can breathe a bit and focus on growing without the constant threat of an astronomical fine hanging over their heads.” 

Many of the legislators’ questions Monday concerned several illegal Chinese-run cannabis operations discovered in western Maine recently and whether the bill would help squash the illicit market. 

Cannabis business owners said loosening some of the burdens on the industry would make running a legitimate business more appealing for prospective entrepreneurs. 

But Figueroa argued that it would have the opposite effect by undermining the statutory and regulatory infrastructure around the legal market, hindering the state’s ability to distinguish between legal and illegal operators. 

As written, law enforcement officials would be banned from entering cannabis businesses, except under specific circumstances or with a warrant. 

Industry members said the language was unintentionally misleading – that it was meant to prohibit law enforcement from entering private, back-end spaces without justification. 

Troy Morton, Penobscot County sheriff and vice president of the Maine Sheriff’s Association, said the group was not aware of the drafted bill until last week but that all 16 county sheriffs in Maine oppose the legislation, which he said is both rare and telling. 

Morton stressed the need for regulation and transparency in the industry, especially as authorities combat the illegal grows. 

Like Morton, Anne Sedlack, director of advocacy of the Maine Medical Association, stressed her disappointment that public health officials were not consulted on the bill.

“If this industry is going to move into its next chapter, there needs to be a balance of recognition of industry needs and public health concerns,” she said.

The bill will be discussed during a work session Friday.

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