Marijuana Moment: Nebraska Officials Miss Medical Marijuana Licensing Deadline As Regulators Resign

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“The integrity of a lawful election is being stolen by self-righteous politicians who beat their chests, trumpeting election integrity while quietly using you as a commission to undermine it.”

By Zach Wendling, Nebraska Examiner

Supporters have questioned for months whether the voter-authorized Nebraska Medical Cannabis Commission would meet its October 1 deadline to grant its first licenses.

The answer is no: The commission will miss that deadline by at least one week, in the wake of two resignations sought and received by Gov. Jim Pillen (R) of liquor regulators who jointly served on the medical cannabis board.

The Medical Cannabis Commission confirmed the new timeline Tuesday at a meeting originally meant to approve the first cultivator licenses and move toward the first steps of a medical cannabis supply chain in the state. However, two of the five cannabis commissioners resigned Monday, both of whom served on a three-member team evaluating and scoring cultivator applications received by September 23.

Now, the remaining commissioners will independently review applications by next Tuesday, when commissioners will meet to decide whether to award up to four cultivator licenses.

“We would just ask for your understanding that this is a situation that none of us created in this, where we’re at right here,” Commissioner Lorelle Mueting of Gretna said Tuesday. “We would just hope you understand that we’re working through this the best that we can to make sure that we get the licenses issued in a timely manner and evaluated and issued in time.”

Resignations impacted timeline

Dr. Monica Oldenburg, an anesthesiologist who chairs the commission, had been on the initial evaluation team with former Commissioners Bruce Bailey of Lincoln and Kim Lowe of Kearney. The plan was to average out scores before this week’s meeting and then vote on whether to grant the first licenses.

Oldenburg, a May appointee of Pillen’s, has a narrower view of what the voters passed than Bailey and Lowe, such as on smoking. Bailey had the most permissive view of voters’ wishes.

Under a state law passed by about 67 percent of voters last November, with majority support in 46 of 49 legislative districts, the commission needed to, “No later than October 1, 2025, begin granting registrations to applicants that meet eligibility standards and other requirements established by the commission.” The guidelines were established by an early July 1 deadline set by voters.

Bailey and Lowe resigned Monday, tossing a major wrench into whether the commission would meet its Wednesday licensing deadline.

Pillen’s request followed the unsealing last week of federal corruption charges against former Liquor Control Commission Executive Director Hobert “Hobie” Rupe. Rupe has pleaded not guilty. The indictment did not implicate any member of the Liquor Control Commission.

While Pillen has rejected all of the pending Liquor Control Commission regulatory changes proposed under the former director, his staff has confirmed that he has no plans to shelve medical cannabis regulations.

Bailey had chaired the Liquor Control Commission and served since 2014. Lowe had served on that commission since 2021. Retired Judge J. Michael Coffey joined the commission in June, a vacancy created after Pillen had previously requested the resignation of a third commissioner, Harry Hoch Jr., in May.

Oldenburg, Mueting and Coffey will review applications on metrics that have not been publicly released. Passing applicants need to average at least 70 out of 100. Applications were entered into a “lottery” to randomly order submissions.

Pillen opposes the legalization of recreational marijuana and has said Coffey, Mueting and Oldenburg—all his appointees—will keep Nebraska’s medical cannabis system carefully regulated. He will appoint two commissioners to succeed Bailey and Lowe.

Licensing lawsuit likely

The commission also faces a potential legal threat from Nebraska Attorney General Mike Hilgers (R). His office has threatened to sue the commission once the first licenses are issued.

“This office has long held that any attempt to license entities to dispense marijuana in Nebraska violates the federal ban [on marijuana],” then-acting Deputy Solicitor General Zach Pohlman testified at a March legislative hearing. “If the Medical Cannabis Commission tries to do so, the Attorney General’s Office will challenge that action as preempted and unenforceable.”

The office has repeated the stance multiple times, including in a separate citizen-led lawsuit seeking to overturn the voter-passed laws, in which Hilgers and Pohlman say it should be the AG’s Office, not a citizen, to challenge the laws’ constitutionality.

A spokesperson for Hilgers declined to confirm last week whether this remained the position of the Attorney General’s Office. A Pillen spokesperson, when asked last week whether the governor supported Hilgers’s efforts, directed questions to the AG’s Office.

A separate voter-passed law authorizes anyone with a health care practitioner’s recommendation to possess up to 5 ounces of medical cannabis in Nebraska. It passed with 71 percent voter support last November, including majority support in every legislative district. Nebraska became the 39th state to authorize a medical cannabis program.

‘We can get started today’

Troy Burgess, one of the cultivator applicants, said Tuesday that once a cultivator begins growing marijuana, it could be five months before anything is sent to a product manufacturer (another license type) and another 4-6 weeks before it is ready for sale at a dispensary (another license type).

“These patients need relief. We need to get it to them,” Burgess told the commission. “We can get started today.”

The proposed regulations the commission is considering would cap the four licensed cultivators to no more than 1,250 flowering plants each at any one time. With two expected harvests in the year, that’s up to 10,000 harvestable plants, if all plants are grown successfully and are contaminant-free. The commission is anticipating an initial program to support about 20,000 patients.

All products would need to meet strict testing requirements as set by the commission.

A public hearing on the proposed regulations is set for 1 p.m. on October 15 at the Nebraska State Office Building. The hearing could last up to three hours, with testifiers limited to two or three minutes apiece.

Written comments can be submitted up to 11:59 p.m. on October 15 by mail to the Nebraska Medical Commission, PO Box 95046, Lincoln, NE 68509-5046; by fax at 402-471-2814 or by email to mcc.contact@nebraska.gov.

‘Integrity’

Dominic Gillen of Bellevue, who has worked with advocates of medical cannabis for more than a decade in Nebraska, spoke to the commission Tuesday about “integrity” and said the full weight of voter trust is on commissioners, not politicians behind the curtain “pulling the strings.”

“The integrity of a lawful election is being stolen by self-righteous politicians who beat their chests, trumpeting election integrity while quietly using you as a commission to undermine it,” Gillen said.

Many Nebraskans again urged the commission to approve of smoking, vaping and raw flower sales, which its proposed regulations reject. Angelica Marsaglia told commissioners they needed to implement the law, not rewrite it.

“That exceeds your authority, undermines the will of the voters and is unlawful,” Marsaglia said.

Gillen said Bailey was guilty of “honoring his commitment to the voters” and “should be hailed as a hero” for standing up for voters, such as pushing for more cultivators and a higher plant cap.

“The politicians have made their heartless choice,” Gillen said. “You, on the other hand, still have one.”

The Medical Cannabis Commission will meet next at 2 p.m. October 7 in Lincoln.

What would the latest medical cannabis regulations mean?

If finalized, the state’s medical cannabis regulations would license up to four cultivators, four product manufacturers, 12 dispensaries and 12 transporters. The guidelines would also establish a “Recommending Health Care Practitioner Directory” and also make Nebraska’s program essentially a low-THC variety.

Under the regulations, patients or caregivers could purchase up to 5 ounces of medical cannabis in a 30-day period, which is about 142 grams. Of that, patients could purchase no more than 5 grams of delta-9 tetrahydrocannabinol (THC) from the same dispensary within 90 days. Delta-9 THC is the part of cannabis most associated with a “high.”

The regulations would allow no more than 12 medical cannabis dispensaries statewide, arranged by judicial district. That could mean one dispensary in Douglas County (584,526 residents), Lancaster County (322,608 residents), Sarpy/Cass Counties (217,202 residents) and Buffalo/Hall Counties (112,979 residents), according to 2020 census data.

Dispensaries would not be able to sell smoking or vaping products or edibles of any kind. Oral tablets with a “thin layer” of flavoring to make the products easier to swallow could be sold.

Under current law, a patient or qualified caregiver with a recommendation from any health care practitioner can legally possess up to 5 ounces of medical cannabis, in any form. But no licenses have yet been issued, so cannabis can’t legally be purchased in Nebraska yet.

The latest set of emergency regulations ends December 7. Commissioners say that set of regulations can be extended for one additional 90-day period.

Once the Medical Cannabis Commission approves a more permanent set of regulations, commissioners will send the regulations to Attorney General Mike Hilgers (R) for legal review and Gov. Jim Pillen (R) for final approval.

This story was first published by Nebraska Examiner.

Photo courtesy of Brian Shamblen.

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