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committee, was set up last year to put a marijuana initiative on the ballot. It’s one of four groups hoping to use the ballot box to shape the future of the marijuana business in Ohio and the one furthest along in the process to get its proposal on a ballot. It is circulating petitions to get the 305,591 valid signatures needed to get on the ballot in November.
Doubling down on a tested strategy ResponsibleOhio’s carefully structured and controversial constitutional amendment has attracted a group of wealthy and influential backers — and investors — to its effort. While the investors’ identities were initially hidden behind blandly named private corporate entities, ResponsibleOhio has identified some of its backers. Among them are Bobby George, part owner of the TownHall and Barley House watering holes in Cleveland; singer and Cincinnati-area native Nick Lachey; fashion designer Nanette Lepore, a Youngstown native; pro football player Frostee Rucker; former basketball star Oscar Robertson; and brothers Woody and Dudley Taft Jr., of Cincinnati, descendents of President William Howard Taft. “Marijuana is available now, but our communities are not seeing the benefits,” said George in an emailed statement to Crain’s Cleveland Business. “As massive funding cuts to schools and first responders continue, it’s time we take a common-sense approach to ending prohibition while supporting local governments and keeping our
communities safe. ResponsibleOhio’s plan will do just that, and I’m proud to be part of this effort.” George’s statement alludes to the tax strategy that is being used to sell the amendment — a strategy that mimics the successful strategy to bring casino gambling to Ohio. ResponsibleOhio will pitch to voters that 55% of the taxes collected will go to cities and townships and another 30% will go to counties, to be used for public safety and road and bridge repair. That, backers project, will generate $51.8 million for Cuyahoga County and its communities and $36.2 million for Stark and Summit counties by 2020. Issue 3 in 2009 succeeded in authorizing four casinos in the state after nearly two decades of ballot issues and legislative attempts to bring gambling to the state. By identifying casinos for Cincinnati, Cleveland, Columbus and Toledo and making sure those communities would get a large share of the taxes on gambling, backers boosted urban voting in favor of the issue. It passed with 52.9% of the vote. The best of the earlier attempts, in 2006, won the approval of only 43.4% of voters.
A marijuana cartel? The hitch in the strategy, and the controversy, is the way the amendment specifies where marijuana can legally be grown — at sites that are controlled by its investors — creating what some are calling a legal marijuana cartel in the state. Another reason the casino amendment in 2009 was successful was because it essentially gave a small group of business people the ability to open casinos by specify-
Other efforts Four groups in addition to ResponsibleOhio are working to get issues on the ballot to help shape the future of marijuana growing and selling in Ohio. Just last week, Attorney General Mike DeWine approved the wording from another group called Better for Ohio as fair and truthful. Now, it needs approval of the Ohio Ballot Board before it can begin to gather signatures. Another entity, the Ohio Rights Group, which also is trying to get its own marijuana legalization initiative on the ballot, meanwhile, has raised concerns over ResponsibleOhio’s ballot issue since it gives its backers a lock on marijuana production. Still, ResponsibleOhio executive director Ian James is confident his group will be the one to gather enough signatures to put its marijuana legalization amendment ing that the casinos only could be built on real estate they controlled. As a result, the Penn National Group, a gaming business, and a group associated with Cleveland Cavaliers owner Dan Gilbert, poured millions of dollars into the campaign to pass the ballot issue, knowing they would be in a position to build and own the casinos. ResponsibleOhio has done the same thing. Its ballot initiative identifies by parcel number where grow sites can be built. The groups that control those parcels are funding the ResponsibleOhio campaign, which could end up costing $20 million, James said. Press reports after the 2009 casino vote es-
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on the ballot. “We’re going to get to the ballot and nobody else is,” he said, noting that if passed, it will spawn more than 1,000 entitites, many of them retailers, but ancillary businesses as well. Rob Ryan, president of the Ohio chapter of the National Organization for the Reform of Marijuana Laws, or NORML, said, “ResponsibleOhio isn’t perfect, but it’s better than what we have now, what I call Prohibition 2.0. The public is really ready for this.” While NORML has campaigned against the criminalization of marijuana use since 1970, Ryan couched his support for ResponsibleOhio’s amendment in economic terms. “There’s going to be a boon in greenhouse and gardening businesses,” he said. — Jay Miller timated backers spent as much as $47 million. James told Crain’s late last month that internal polling shows that 61% of voters in Ohio support legalizing the personal use of marijuana. A recent poll by Quinnipiac University found slightly less support. The Quinnipiac survey of 1,077 Ohioans in a late March poll found 52% of respondents supported allowing adults to possess small amounts of marijuana for personal use, while 44% opposed.
Tie-dyes, suits and ties The 10 investment groups that
will each get licenses to grow marijuana have made an initial investment of $4 million each, according to documents filed with the federal Securities and Exchange Commission. Since James told Crain’s it could cost $40 million to build greenhouses and processing facilities at each site, those initial buy-ins would appear to be little more than campaign finance war chests. As James put it, marijuana cultivation and sale is going “from tiedye to suit and tie.” In addition to the 10 corporations that will operate the growing sites, James predicts that 1,000 new business will sprout up, including distributors and retailers. All will be licensed by a state-run Marijuana Control Commission. Boy band alum Nick Lachey is part of a group that would own 29 acres on Hudson Crossing Parkway in Hudson, now owned by Industrial Land Partners Holdings LLC, an investment group that includes Ross Farro and Spencer Pisczak of Premier Development Partners of Cleveland. George, son of restaurateur Tony George, meanwhile, is part of the investment group that has an option to buy 27.2 acres of former industrial property now owned by the city of Lorain. Lorain Mayor Chase Ritenauer said the property had been an unsuccessful industrial development that was costing the city money in upkeep and lost tax revenue. “I’m happy the voters are going to have a say” on whether to allow recreational marijuana use, he said. “For me, it was purely a business decision.”
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