The governor of Montana signed a bill into law to legalize marijuana possession and regulate its sale in a historic move that largely honors the outcome of last year’s Election Day referendum on the issue.

The legislation, sponsored by Rep. Mike Hopkins (R-Missoula), permits retail sales of cannabis for adults 21 and older from January 1, 2022, and allows for cultivation of two mature plants and two seedlings per person, with a maximum of four mature plants per household.

The bill’s approval by the legislature and passage into law follows a drawn-out process that saw a flurry of marijuana-related measures introduced, some of which sought to either restrict or delay the voter-approved cannabis legalization initiative – I-190. Up until the last day of the legislative session, Montana’s Senate considered various proposals and amendments to the bill – HB 701 – that critics claim would have disregarded the will of the voters.

Much of the debate surrounding marijuana legalization in Montana after voters approved I-190 revolved around taxation and allocation of revenues. While I-190 stipulates a tax rate of 20 percent and instructs state officials to use the money to fund veterans services and conservation programs, the initiative was subject to an ongoing legal challenge on the basis that no ballot measure has the authority to direct how state funds are spent. Notwithstanding, many Democrats preferred to keep as close to the provisions of I-190 as possible, while some Republicans believed lower taxes of recreational sales would help drive down black market activity.

Under one of the concessions made to get HB 701 through the legislature, only those counties with a majority vote for I-190 on Election Day will automatically have the measure enacted into law, unless a council votes to “opt-out.” Those counties with less than a 50 percent vote in favor will have to take affirmative action for adult-use marijuana legalization to pass in their jurisdiction.

In those counties with legal cannabis retailers, recreational sales will be taxed at 20 percent and medical cannabis at 5 percent. Counties also have the option of tacking on a further 3 percent local tax on marijuana sales.

A significant portion of the state’s marijuana tax revenues will go toward the Healing and Ending Addiction through Recovery and Treatment (HEART) Fund; a state-funded drug treatment program that offers grants to community groups and non-profits that provide substance abuse care and prevention services. Gov. Greg Gianforte has made funding substance abuse programs a key plank of his administration since coming into office.

“From the start, I’ve been clear that we need to bring more resources to bear to combat the drug epidemic that’s devastating our communities,” Gianforte said in a statement. “Funding a full continuum of substance abuse prevention and treatment programs for communities, the HEART Fund will offer new support to Montanans who want to get clean, sober, and healthy.”

HB 701 will transfer responsibility for Montana’s marijuana industry to the Department of Revenues from the Department of Public Health and Human Services, which currently oversees Montana’s medical cannabis program. Existing licensed medical marijuana dispensaries will have exclusivity to apply for recreational licenses for the first 18 months of Montana’s adult-use cannabis market.

Montana’s new cannabis legislation will also establish a special drug court to investigate possible resentencing and expungement of prior cannabis-related convictions.

“Since January, we’ve been focused on implementing the will of Montana voters in a safe, responsible, and appropriately regulated manner. House Bill 701 accomplishes this,” Gianforte said in his statement.

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