Marijuana

‘An End to Prohibition’

Dispensary owners have been preparing for recreational marijuana sales since 2020, ramping up supply to prepare for at least a doubling in sales

By Maggie Dresser
An employee of Tamarack Cannabis trims and weighs buds of marijuana on Dec. 29, 2021. Hunter D’Antuono | Flathead Beacon

On New Year’s Day, Tamarack Cannabis owner Erin Bolster had about 20 customers browsing her store during peak hours, each with a buzzer in hand patiently waiting for a bud tender to assist them. 

It was the first day that marijuana dispensaries were permitted to operate after voters opted to legalize its recreational use and sale in 2020, and Bolster says there was about five times the volume of people compared to previous Saturdays, when access in Montana was restricted to medical marijuana only. 

That prohibition was lifted on the first day of the new year, opening the floodgates to new streams of clientele as well as revenue for private entrepreneurs, local municipalities and state governments.

From long-time recreational cannabis users to tourists and first-time users, Bolster saw a wide variety of customers throughout the first week of recreational legalization.

“It’s amazing how many people wouldn’t try it because it was illegal,” Bolster said. 

As soon the recreational marijuana initiative made it on the ballot in the summer of 2020, Bolster began ramping up production, accurately predicting that Montana voters would approve the use and sale of the product that she’s been selling to medical marijuana card holders since 2009.

With a year-and-a-half to prepare, Bolster added 1,000 square feet of greenhouse space, and added 1,500 square feet to the indoor production space, totaling her cultivation area to 4,500 square feet.  

“We doubled our indoor space and we intend to double it again this year,” Bolster said.

Bolster suspects she could see a quadrupling in Tamarack’s sales this year, but she says it’s difficult to predict sales in the Flathead Valley because of the high volume of tourism in the summer.  

According to a 2020 study by the Bureau of Business and Economic Research (BBER) at the University of Montana, 14.3% of adults in Montana said they used marijuana in the last 30 days while 22% use cannabis daily. More than 14% of leisure-oriented visitors seek out recreational cannabis stores nationwide. A total market size in the state for residents was based on estimates that consumers used between 30.4 and 32.8 metric tons of marijuana in 2020. 

Researchers applied a demand-based approach to evaluating the market size, but the estimates did not consider factors like a rise in cannabis consumption, inflated prices, changing social norms and non-smokable cannabis products like edibles, making it difficult to predict the future demand.  

A Tamarack Cannabis shop employee piles up dried marijuana flowers on Dec. 29, 2021. Hunter D’Antuono | Flathead Beacon

“There are a lot of people trying to guess how much the market will increase,” Bolster said. “Most of the market research suggests we’re going to see somewhere between a doubling and tripling of sales.” 

At the Montana Canna dispensary west of Kalispell, Zach Block has been selling to medical marijuana card holders since 2019 and he’s been steadily expanding his shop nonstop to keep up with demand for the last few years.  

Once the state “untethered” medical marijuana patients in 2020, meaning they were no longer restricted to a single dispensary and could freely shop around, his sales took off.

Block cultivates cannabis on-site at Montana Canna, using a roughly 2,000-square-foot space with an extraction lab, kitchen and retail area. That’s allowed under a Tier-2 license, which the state issues based on the square footage of a dispensary’s cultivation space with Tier 9 being the highest. 

Since the recreational market led to an immediate increase in the demand for product, Block also plans to scale out his operation, potentially setting up shop in the Flathead’s surrounding cities. But Block was disappointed that city councilors voted to restrict dispensaries to a few locations in Kalispell. He would have liked to open a shop in town, but says he will likely expand in Bigfork, Whitefish or Columbia Falls instead due to the zoning restrictions.

“If you go down to the green mile (in Evergreen), sometimes there are shared parking lots and it doesn’t make sense to have all of them stacked up right there,” Block said. “Any of your consumers that have to travel, you lose the advantage of the geographic location. From the medical side of things, we want to be conscious of people who are not always able to travel across town.”

In Kalispell, dispensaries are allowed in the city’s industrial zones, which would limit dispensaries to the southside of the city, while Whitefish adopted zoning that will allow dispensaries downtown and in all commercial business districts with 500-foot buffers separating dispensaries. Columbia Falls zoned dispensaries to a section of U.S. Highway 2 within the city. 

Both Block and Bolster predict a busy start to 2022 with a threat of supply shortages in the summer as tourists visit the Flathead in droves, adding exponentially to the demand. 

“For the industry in general, we will have to see if the supply holds up,” Bolster said. “That’s the main concern that is on everyone’s mind. Everyone is expecting a doubling and until we get through the first summer, it will be hard to know if there’s enough licenses. That’s the big question the whole state will be asking.” 

While Bolster isn’t worried about her production at Tamarack, she suspects some of the smaller operations may run into supply shortages this summer. But once wholesaling becomes legal in February, some of the bigger shops can sell products to other dispensaries, which could help alleviate shortages. Dispensaries in Montana have been historically vertically integrated, which means the licensee must cultivate and manufacture all the products they sell. 

Since Bolster started at Tamarack operating out of a living room 13 years ago, she has watched Montana update or overhaul its marijuana laws five times. In that time, there have also been federal raids on medical dispensaries and a threat to a repeal the legalization of medical pot in 2011.

For Bolster, she’s ready to usher in a new era in recreational adult-use legalization.  

“For us, it was sort of an end to prohibition,” Bolster said. 

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