HELENA — For the last four years, the Montana Department of Revenue has been responsible for regulating both alcohol and marijuana businesses in the state. Now, department leaders are planning to bring both under a single division – though some in those industries are apprehensive about the move.
(Watch the video for more about what's changing – and what isn't – in alcohol and marijuana regulation.)
Currently, Revenue’s Alcoholic Beverage Control Division oversees liquor licenses and operates the state liquor warehouse. The Cannabis Control Division regulates marijuana dispensaries, producers and testing laboratories.
At a Tuesday meeting of the Montana Legislature’s Economic Affairs Interim Committee, lawmakers heard from representatives of both industries, who said that those divisions are doing a good job, and they're concerned about what could change if the two are combined.
“Alcohol regulation is unique to Montana, just as it is in every other state; it's complicated,” said John Iverson, government affairs consultant for the Montana Tavern Association. “Frankly, I think the people that we have doing it are doing it well, and so we're a little nervous about any changes there.”
“We need assurances that these efficiencies aren't going to be reductions that are going to affect the quality of service that we're getting from the department,” said Pepper Petersen, president and CEO of the Montana Cannabis Guild.
During the meeting, Department of Revenue director Brendan Beatty sought to ease those concerns.
“Nobody's losing their job, nothing is going away,” he said. “The effect on the citizen and the business owner is going to be the same.”
Beatty said each of the divisions has between 30 and 40 employees – far less than other divisions in the department. He plans to bring in a single administrator to oversee both programs but leave them operating essentially as they are, now as two bureaus under the same division.
Beatty said it made sense for Cannabis Control Division to be separate when the state first launched its adult-use recreational marijuana program in 2021, but the situation is different now.
“Now that division is up and running extremely well, just like ABCD is running extremely well,” he said. “Now we need to start capitalizing on the synergies and the efficiencies of these two entities.”
Beatty said there wouldn’t be immediate savings. He said the department wouldn’t be firing anyone, but he expected there could be positions left unfilled over time if employees leave. He believes there will be opportunities for greater efficiencies going forward when it comes to things like employee training.
“I see nothing but good coming out of this,” he said.
Some lawmakers said they had more reservations.
“To me, this right here just seems like we're asking for trouble, because alcohol and cannabis – I mean, when you come up here, if you're blind to it and you're a legislator, you don't know the hornet's nest you're stirring if you want to do anything in them two divisions,” said House Speaker Rep. Brandon Ler, R-Savage.
Beatty said he hopes the switch will actually improve service and create more consistency for businesses. He also argued it will help Revenue be ready to deal with products that blur the lines around the alcohol and marijuana industries – like THC-infused beverages. Currently, drinks containing THC are regulated under the Cannabis Control Division and can only be sold in dispensaries.
Kate Cholewa, with the Montana Cannabis Industry Association, said some in these industries are wondering if the department is expecting the Legislature to make bigger changes in the coming years.
“Like the idea is to build an infrastructure, a baseball mitt, and the ball is coming next session – and that is for these other types of THC and kratom products that are going to get inserted into this new division that's kind of dealing with psychoactive products,” she said. “That’s what it sounds like to me.”
The state has a job posting online for the administrator of a new Cannabis and Alcohol Regulation Division, or CARD. Beatty said they’ll close applications for the position Aug. 1, and they’ll move forward as soon as someone is hired.
“I guess the short answer is this is going to happen fast,” he said.
