2020 Elections and Cannabis: Spotlight on South Dakota’s Measure 26 and Amendment A

By Charles Alovisetti and Kimura Mercer

Oct 30, 2020

Part 5 of our series of articles exploring the impact of the 2020 elections on the cannabis industry. This November 3, in addition to presidential and congressional elections that will have a major impact, five states have ballot measures that will legalize marijuana in some form. South Dakota is one of those states.

South Dakota has two cannabis ballot measures this fall: one legalizing medical marijuana and one legalizing adult-use marijuana. Unlike many instances where multiple ballot measures are at odds, these two measures do not compete against each other. If you live in South Dakota, you can, and should, vote for both.

The current laws surrounding marijuana in South Dakota are some of the nation’s strictest. For example, suppose you consume marijuana in a state where it is legal. When you come back to SD, you could face a felony offense from possession by ingestion (having an illegal substance in your system). This is the only state in which this is a felony.

The state does have an extremely limited cannabis law on the books, as Senate Bill 95 moved cannabidiol to the state’s list of Schedule IV controlled substances and excluded it from the definition of marijuana, but with a major caveat: this would only occur if cannabidiol was approved by the Food and Drug Administration. Also, House Bill 1001, which legalized the growth, production, and transportation of industrial hemp, was signed into effect by Governor Noem on March 27, 2020. However, this bill only addressed hemp production and does not authorize the sale of CBD products (whether or not derived from hemp or marijuana).

Measure 26: Medical Marijuana

Measure 26 would create a commercial medical use system. This 2020 ballot measure would legalize medical marijuana use and establish a program for medical marijuana patients and a dispensary system overseen by the Department of Health. This would include legalization of delivery, manufacture, and cultivation of marijuana and marijuana-based products. Local authorities would have the ability to create additional regulations, and lab testing would be required for all marijuana and marijuana-based products to certify product safety.

Amendment A: Adult-use Marijuana

Amendment A would create a commercial adult-use system. This ballot measure would legalize the possession, distribution, use, and transport of marijuana and marijuana paraphernalia for all people aged 21 and older. The amendment would also authorize the Department of Revenue (DOR) to issue licenses for commercial cultivators and manufacturers, testing facilities, wholesalers, and retailers. Local authorities would have the ability to create additional regulations, and a 15% tax would be imposed on all marijuana sales. The tax revenue would go to the DOR’s cost of implementing this amendment, and the remainder of that would be divided to support public schools and the state's general fund. The measure also requires the legislature to develop laws legalizing hemp (an area where SD has fallen behind the rest of the country) and medical marijuana.

Join us on November 19 for a post-election discussion with members of the Vicente Sederberg LLP and VS Strategies team. Learn more and register here for this timely event!

Read about Montana in the final post of our 2020 Election series.



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