Florida is poised to have another shot at legalizing adult-use cannabis, reigniting hopes that the US’s third most populous state could yet become the trigger event for the cannabis industry many had anticipated last year.
The group Smart & Safe Florida submitted a fresh initiative to the state Division of Elections on Tuesday.
If passed, it would legalise cannabis for adults aged 21 and older, allowing possession of up to two ounces of cannabis and five grams of cannabis concentrates. Additionally, it establishes a regulatory framework for recreational cannabis production and sales.
Medical Marijuana Treatment Centers (MMTCs) and Licensed Marijuana Entities will be authorized to acquire, cultivate, process, transport, and sell cannabis for personal use. Existing MMTCs can operate their facilities and open new ones under the oversight of the Florida Department of Health.
The new initiative includes several revisions to address criticisms of the 2024 ballot measure. One criticism, voiced by Republican Governor Ron DeSantis, concerned the lack of provisions allowing the legislature to regulate public cannabis consumption.
The updated measure explicitly bans smoking and vaping cannabis in public places. Furthermore, it prohibits marketing and packaging designed to appeal to children.
The proposal also allows for legislative authority to regulate home cultivation of cannabis, addressing concerns from advocates who criticized last year’s measure for excluding this provision.
It comes just weeks after the highly anticipated Amendment 3 initiative fell frustratingly short of securing a 60% supermajority needed to be passed under Florida law, securing 56%.
As the third largest state in the US by population, many commentators have speculated that should this amendment have been passed, Florida could become the second largest adult-use cannabis market in the US, trailing only California.
According to Viridian Capital Advisors, this result is likely to have cost the cannabis companies around an incremental $2-3bn run rate of revenues.
At 30%ish EBITDA margins, this is a $1B EBITDA hit, and at 5x somewhere around a $5B potential market cap hit. If the company’s profit margins (EBITDA margins) are around 30%, then this setback could result in a $1 billion hit to their overall profits. And based on a typical valuation multiple of 5 times EBITDA, that $1 billion profit hit could translate to around a $5 billion reduction in the company’s potential market value.
Smart & Safe Florida is now preparing to collect the nearly 900,000 signatures needed to place the measure on the ballot. If successful and approved by the state Supreme Court, Floridians will vote in 2026 on whether to grant adults over 21 the ability to access safe, lab-tested cannabis products for personal use at home.
