As New Mexico officially became the 17th state to legalize recreational cannabis last Tuesday, and most of us were celebrating our newfound freedom to possess and grow recreational marijuana, state leaders met online to discuss rule proposals in a meeting that drew more than 500 attendees.

The hours-long hearing with the state’s newly formed Cannabis Control Division covered licensing fees, inspection requirements, criminal background checks and other topics. The hearing brought out a number of advocates who offered public comments on the proposed rules. Many voiced concerns about water rights, and some spoke about the potential exploitation of local residents at the hands of large, out-of-state corporations.

“These rules do nothing to promote or encourage the full inclusion of underserved communities,” said cannabis equity advocate Rosalie Flores. She said the new law caters to large operations that could damage the local communities and start what she called a “water war.” “They’re not held accountable for their water use. They’re not required to consider how their presence can negatively affect drinking water, cultural traditions and historical practices within the communities they produce in. They’re allowed to take as much as they can afford, including the land and water from local New Mexicans who have been here for centuries, and they don’t have to give a dime back to the communities that they apparently care nothing about.”

Kristina Caffrey, chief legal officer at Ultra Health, the state’s largest medical cannabis producer, said the CCD needs to establish clear and immutable rules for cannabis companies. “CCD has proposed to have some kind of rolling rulemaking—with lots of revisions and amendments,” she said. “That will be a disaster for regulated entities. It is extremely hard to run a business when we are constantly trying to figure out which regulations apply today or tomorrow or next week or next year.” She criticized the division, saying the regulatory process lacked transparency, and claimed that the division was looking to implement rules that contradict the spirit of the law. “We must ask ourselves,” she said, “do these regulations impose unreasonable barriers that would perpetuate, rather than reduce and eliminate, the illicit market for cannabis?”

The troubles surrounding cannabis production limits and consumer demands were also broached, once again. Medical cannabis producer Organtica’s founder David White told state regulators, “I urge the panel to do everything within their powers to ensure that patients have adequate supply during this transition period, and that we remember that if not for the patients and producers, we wouldn’t have the program that we do today. Nor would we have this opportunity to advance into recreational cannabis.”

The CCD said it will review all public comments related to the proposed regulations before deciding on the final rules. Those rules must be in place by September 1.

Medical Pot Is Tax Free

The New Mexico Cannabis Control Division recently reminded patients that all medical cannabis sales are now tax-free according to the new legalization law.

The division recently sent out a press release stating that as of Tuesday, June 29—the date that the Cannabis Regulation Act went into effect—medical marijuana dispensaries are no longer required to pay gross receipts taxes on medical cannabis sales. Since the inception of the state’s Medical Cannabis Program, these taxes have been passed on to patients at the point of sale. But with the new rule in place, dispensaries should have already stopped collecting the tax.

“In standing up the adult-use cannabis industry in New Mexico, we are committed to protecting the medical cannabis program that has served thousands of New Mexicans,” said Regulation and Licensing Department Superintendent Linda M. Trujillo. “Removing the gross receipts tax on medical sales is one step that the state is taking to ensure patients are able to get the medicine they need.”

Medical cannabis sales will also be exempt from the new cannabis excise tax that will be levied at recreational sales.

Municipalities Prepare For Retail Sales

Now that much of the debate around where to let pot shops operate in Albuquerque has settled, other counties and municipalities around the state are preparing to wage their own battles.

Santa Fe leaders are only beginning to struggle with zoning regulations. According to the Santa Fe New Mexican, Santa Fe County officials have already begun talks over county ordinances regarding retail recreational cannabis zoning. But Santa Fe city officials have barely started discussing the issue.

Santa Fe Councilor Michael Garcia told reporters that he was frustrated with the City Council’s lack of urgency on the matter and expected it to vote on the issue later rather than sooner. Councilor Chris Rivera said he was worried that the council would bump into similar obstacles that the Albuquerque City Council faced and risk missing the September 1 deadline.

Santa Fe City Councilor Carol Romero-Wirth said the city will likely base its policies on those adopted by others.

US House Approves Research Bill

The U.S. House of Representatives approved a bill that would allow researchers to gain access to cannabis from state-legal dispensaries for studying drugged driving.

The provision to open up research opportunities was part of a much larger transportation bill that received support from House Democrats but was rejected by most Republicans. The $759 billion INVEST In America Act is part of a Democrat-led infrastructure renewal plan that would provide funding to efforts to build and update roads, bridges, railways and municipal water pipes.

The bill would require the transportation secretary, the U.S. Department of Health and Human Services and the Justice Department to prepare a report with recommendations on setting up a sampling of different types of marijuana collected from states where it is legal for researching the effects of driving under the drug’s influence. The collection would be accessible to scientists in states where cannabis is still illegal.

The bill will also require states where cannabis is legal to establish highway safety programs to educate drivers on the risks associated with marijuana-impaired driving.

If the bill becomes law, the report will be due two years later.