A State-by-State Look at Where Cannabis Is Legal

A State-by-State Look at Where Cannabis Is Legal

The marijuana industry is fast-paced is more ways than you can imagine. Sure, growth estimates for the industry are through the roof, with various Wall Street estimates suggesting that global annual sales could grow to between $50 billion and $200 billion in roughly a decade’s time. But this isn’t the only dynamic aspect of legal cannabis.

For example, innovation and product development are constantly evolving. Grower Cronos Group (NASDAQ: CRON) formed a partnership with Ginkgo Bioworks to gain access to its microorganism development platform in September. Cronos will be using Gingko’s platform to create yeast strains that are capable of producing eight targeted cannabinoids at commercial scale, which could prove considerably cheaper than using traditional extraction techniques on cannabis and/or hemp plants. Cronos can then sell this product, or use it to create a line of derivative pot products in Canada.

Another area where we’re seeing the constant evolution of the cannabis landscape is at the state level in the United States. Between the perceived medical benefits of cannabis and the possible tax revenue it can generate, more and more states have been waving the green flag on marijuana in recent years.

With that being said, understanding which states have, and have not, legalized recreational or medical marijuana can be tricky. Below, I’ve outlined an easy-to-understand look at all 50 states that leaves no doubt as to where each stands on cannabis.

A black silhouette outline of the United States, partially filled in with baggies of cannabis, rolled joints, and a scale.

A black silhouette outline of the United States, partially filled in with baggies of cannabis, rolled joints, and a scale.

Image source: Getty Images.

These states have legalized recreational cannabis and are selling it

First up are the most progressive states on cannabis in the United States. The following eight states allow recreational marijuana to be sold in licensed dispensaries and (obviously) also allow medical marijuana to be prescribed by physicians. These eight states are (in alphabetical order):

  • Alaska

  • California

  • Colorado

  • Maine

  • Massachusetts

  • Nevada

  • Oregon

  • Washington

According to a recently released report from Arcview Market Research and BDS Analytics (“State of the Legal Cannabis Markets”), U.S. spending on licensed recreational pot will surpass an estimated $7.3 billion in 2019. For added context, that’s more than all of Canada will sell by 2024, per the report.

California is, by far, the leading market in the U.S. for marijuana sales, with the Golden State expected to generate $3.1 billion in 2019 revenue. Beyond California, only Colorado and Washington are forecast to hit more than $1 billion in recreational weed sales this year. However, keep your eyes on Nevada, which is projected to have the highest per-capita spending on recreational marijuana of any U.S. state by 2024.

A bearded man holding a lit cannabis joint in front of his face by his fingertips.

A bearded man holding a lit cannabis joint in front of his face by his fingertips.

Image source: Getty Images.

These states have fully legalized recreational cannabis but are not selling it (yet)

In addition to the eight states to have legalized and sold recreational cannabis, there are three other states that have given adult-use weed the green light but have yet to sell any recreational product. These states are:

  • Illinois

  • Michigan

  • Vermont

The Illinois Legislature recently passed — and its governor, J.B. Pritzker (D-Ill.), signed — a recreational cannabis bill into law, with sales set to begin on Jan. 1, 2020. Meanwhile, Michigan voters legalized a recreational marijuana initiative in 2018, but the state isn’t expected to commence licensed sales activity until sometime in 2020.

As for Vermont, its legislature legalized recreational marijuana use in early 2018, but at the moment the state forbids retail sales of the drug. This should soon change, with the legislature working on bills that would create a retail system (and presumably a tax) that’s similar to other legalized states.

As with the other recreationally legal states, medical pot is also legal.

A physician with a stethoscope around his neck holding a cannabis leaf between his hands.

A physician with a stethoscope around his neck holding a cannabis leaf between his hands.

Image source: Getty Images.

These states have legalized medical marijuana, but adult-use weed isn’t legal

With more than a fifth of the country giving the green light to recreational cannabis, we next move on to a group of 22 states that allow for the prescription use of medical marijuana for certain ailments, but that don’t allow for recreational marijuana use. Mind you, some of the following states may have decriminalized its usage, thereby lessening penalties for those caught, but the gist is that adult-use marijuana is still a no-no in these states (once again, in alphabetical order):

  • Arizona

  • Arkansas

  • Connecticut

  • Delaware

  • Florida

  • Hawaii

  • Louisiana

  • Maryland

  • Minnesota

  • Missouri

  • Montana

  • New Hampshire

  • New Jersey

  • New Mexico

  • New York

  • North Dakota

  • Ohio

  • Oklahoma

  • Pennsylvania

  • Rhode Island

  • Utah

  • West Virginia

Although medical cannabis revenue is still growing in the U.S., its pace of growth is expected to slow as recreational legalizations continue. After all, why take the extra step of getting a doctor’s prescription when any adult over the age of 21 can simply walk into a licensed dispensary in a recreationally legal state and buy cannabis?

Nevertheless, Florida remains a major market to keep an eye on in terms of sales, with the Sunshine State representing a strong candidate to push for adult-use legalization in 2020. Other states that could make a run at joining the aforementioned 11 adult-use-legal states in 2020 includes Arizona, New Jersey, Maryland, Ohio, and maybe even Minnesota.

A drug free zone street sign in a quiet neighborhood.

A drug free zone street sign in a quiet neighborhood.

Image source: Getty Images.

These states align with the federal government in keeping cannabis wholly illegal

The final group consists of 17 states that haven’t legalized medical or recreational cannabis access to any degree, which means they’re essentially mirroring the federal government’s stance on the drug. I should point out that the passage of the farm bill in December does give adults in these 17 states access to cannabidiol (CBD) products containing no tetrahydrocannabinol (THC), the psychoactive cannabinoid that gets users high. CBD isn’t psychoactive, and it’s best known for its perceived medical benefits.

The 17 states where marijuana is wholly illegal are:

  • Alabama

  • Georgia

  • Idaho

  • Indiana

  • Iowa

  • Kansas

  • Kentucky

  • Mississippi

  • Nebraska

  • North Carolina

  • South Carolina

  • South Dakota

  • Tennessee

  • Texas

  • Virginia

  • Wisconsin

  • Wyoming

What’s noteworthy about these 17 states is that most of them tend to have Republicans in charge of their respective legislatures. Surveys have consistently shown that members of the GOP have a more adverse view of marijuana than do Democrats or Independents. This certainly sheds light on why these 17 states remain on the outside looking in.

Of course, a few of these unlikely states are working on legalization efforts right now.

Plenty of opportunity awaits

Even though 33 states, in aggregate, have legalized cannabis to some degree, there’s plenty of opportunity for legal marijuana growth in the years that lie ahead. Most of the 11 states that have legalized recreational weed are nowhere near their peak annual sales potential, and, as you can see, 39 states could still wave the green flag on adult-use marijuana at some point in the future. It’s this opportunity that’s encouraging plenty of consolidation and investment in the U.S. pot industry.

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Sean Williams has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

This article was originally published on Fool.com

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