A slow rollout, but R.I. cannabis sales double in a year
PAWTUCKET, R.I. — Joseph Dwyer, 74, stopped into a Pawtucket cannabis dispensary on a recent afternoon, browsing the offerings on an iPad with the help of a sales associate known as a “budtender.”
He opted for the pre-rolled joints — “I have arthritis,” he explained — and was on his way.
The showroom — replete with marble countertops, a cascading waterfall, and backlit edible displays — is a far cry from how Dwyer said he purchased “grass,” as he called it, as a teenager in 1967 on the black market in South Providence.
“It’s safer now,” Dwyer said, adding that he uses cannabis for leg pain in addition to recreational enjoyment.
Dec. 1 marked the first anniversary of legal recreational cannabis sales in Rhode Island, and monthly sales have roughly doubled since the launch, generating more than $60 million, while medical marijuana sales have steadily decreased.
Technically, recreational cannabis has been legal in the state since May 2022. But the Dec. 1 start of sales felt like the true start of the legal cannabis era, where an eighth of bud is now as easy to pick up as a bottle of cabernet.
One year in, Rhode Island is still working to fully set up its new industry. It took longer than anticipated for Governor Dan McKee to name members to the newly created Cannabis Control Commission, and the threemember board has not yet taken over control of the industry. Up to 24 new stores authorized by the legalization law are not opening anytime soon.
As a bridge measure in the meantime, the state allowed recreational sales to start at seven previously-authorized medical marijuana dispensaries on Dec. 1 of last year, and an eighth store is expected to open in Woonsocket soon after a protracted legal battle with the city.
The customer base keeps growing.
“It’s been a successful year,” said Joe Pakuris, one of the owners of Mother Earth Wellness, the Pawtucket retailer. “I think there’s a lot more growth to be seen in Rhode Island.”
According to the R.I. Department of Business Regulation, which still regulates the market until the CCC takes over, $63 million worth of recreational cannabis was sold during the first 11 months. November sales data is not yet available, but is expected to be in line with October, deputy DBR director Matt Santacroce said.
If so, sales from the first year of legal recreational cannabis would surpass $70 million.
In the first month of sales, $3.4 million worth of recreational cannabis was sold throughout the state. In October, the most recent month available, that number was $7 million.
“A lot of people still don’t even realize cannabis is recreationally legal in Rhode Island,” Pakuris said, estimating that he gets 100 to 200 new customers per day out of roughly 1,500 daily customers.
“If your habit is to go to a place in Massachusetts on your ride home and you’ve been doing that for four years, it’s hard to break that habit,” Pakuris noted. “It’s going to take a few years to really energize this market and get our consumer base.”
As the number of recreational shoppers goes up, medical marijuana sales are simultaneously decreasing, reflecting the fact that many medical patients are switching to the recreational market, Santacroce said.
While medical cannabis is cheaper because of lower taxes, the cost of a doctor’s appointment and hassle of paperwork to get a patient card isn’t worth it for everyone now that it’s so easy to buy recreational cannabis.
Medical registrations have dropped down to 10,377 patients from a previous high of nearly 20,000. (Rhode Island accepts medical cards from other states, and those patients are not reflected in the numbers.)
Medical sales were nearly $4 million in December 2022 and dropped to $2.3 million in October 2023, according to the state figures.
When combining medical and recreational, the retail market has grown from $7.4 million in sales in December 2022 to $9.4 million in October of this year. The highest month of sales was in August, when the total topped $9.6 million, before dipping slightly in September and October.
“It’s one year, and so no one’s walking around here spiking the football having a big party,” Santacroce said. “We were focused on a transparent, compliant, glitch-free rollout of this market and by all accounts we’ve achieved that.”
Recreational sales for the current fiscal year are roughly on track to reach state budgetcrunchers’ current projection of $76 million, which would translate to $13 million in tax revenue for the state and $2.3 million for local municipalities where the stores are located. (Recreational sales are taxed at 20 percent.)
The taxes generated from the sales go into a combination of the state’s general fund, a fund that covers the cost of running the cannabis program, and local municipalities’ budgets.
When it comes to customers’ favorite products, the biggest moneymaker is pre-packaged bud, also known as raw flower, that goes for as low as $30-$35 for an eighth of an ounce, according to dispensary menus.
The first year of legal sales has also benefited the 60 licensed growers in Rhode Island, many of whom have been beating the drum for years about having practically nowhere to sell their products after being licensed by the state years ago to cultivate cannabis.
Until recently, the growers could only sell to three medical dispensaries, all of which also grew their own cannabis. (It’s illegal to sell across state lines.)
“It’s a very slow rollout so far,” said Karen Ballou, owner of Cultivating RI, a grow facility in West Warwick. “We all thought recreational was going to be the cure-all for the industry, and we’re not there yet.”
Rhode Island’s legalization law called for 33 stores total, which means 24 new stores in addition to the nine medical dispensaries authorized by previous state laws.
Pakuris said he hopes Rhode Island looks with caution at Massachusetts, which has a thriving market but no cap on how many retailers can be licensed. There are currently more than 300 licensed stores.
“Massachusetts is oversaturated,” Pakuris said. “There’s too many stores, way oversupply. I just hope we don’t follow that path and go down that road.”