COLUMBIA – The Missouri Department of Health and Senior Services first started issuing licenses for medical marijuana dispensaries in January of 2020.
Many of those dispensaries began to open in fall of the same year.
But the DHSS rejected the overwhelming majority of medical marijuana dispensary license applicants. That's because the state set a limit for how many licenses it can give out.
Now, according to the St. Louis Post-Dispatch, the department is spending millions in legal fees to defend its decisions to deny applicants.
That takes away from tax revenues supposed to go to the Missouri Veterans Commission, which is why some think the department should just remove the license cap. But the chief operating officer of a Columbia dispensary disagrees.
"Oregon and Oklahoma have an open market, and it's not a very good setup for the industry," Michael LaFrieda said. LaFrieda is the chief operating officer for Shangri-La Dispensary.
LaFrieda has previous experience in the industry in Nevada, and said understanding the market and surplus of products is necessary to ensure the health of the industry.
"192 dispensary licenses in Missouri was already quite a bit, and currently — and I might be slightly off on that — probably roughly 25 percent of those businesses are still not up and running yet," LaFrieda said. "So, if there was an even bigger market of businesses opening, they probably wouldn't even be opening."
For LaFrieda and Shangri-La Dispensary, the limit can provide a better experience for consumers. LaFrieda said consumer demand would not change even without a limit.
"We'd rather have a few extra dollars, be able to provide a much better selection of products instead of that total surplus and 'total free-for-all' that we've seen in open markets," he said. "The same amount of money [tax revenue] is going to be generated either way."
LaFrieda said he believes recreational use in Missouri could be passed down from the state legislature before the end of 2022.