COLUMBUS, Ohio – A divided state panel waived through an Ohio Division of Cannabis Control rule banning advertisements of recreational marijuana dispensaries on billboards, radio, television or the internet and in stadiums and arenas.
The Joint Committee on Agency Rule Review decision Monday makes it official that Ohio’s highways will look nothing like Michigan’s, where signage – especially profuse near its borders with other states – notify drivers of dispensaries and cannabis products.
The committee’s decision comes despite opposition from the Outdoor Advertising Association of Ohio, which warns that the rule will hurt business and could violate companies’ First Amendment rights to communicate with the public.
“Clearly billboards are a popular and impactful medium, and specifically prohibiting their use will have an adverse impact on cannabis operators to advertising their products,” said Kevin Futryk, the association’s executive director.
Futryk further said that a First Amendment attorney reviewed the rule, yet his comments were not included in an earlier analysis of business impacts put out by Gov. Mike DeWine’s office.
Democrats on the committee also opposed the rule, proposed a year ago.
On Nov. 7, 2023, 57% of Ohio voters approved an initiated statute that legalized recreational marijuana. The marijuana businesses that put the statute on the ballot called their proposal “Just Like Alcohol.”
But state Sen. Bill DeMora, a Columbus Democrat and committee member, said the marijuana advertising rule is more stringent than alcohol advertising.
“I go to sports arenas, I see alcohol signs everywhere,” he said.
The initiated statute that voters approved does put limits on advertising, specifically saying ads cannot be false or misleading. Ads cannot target children, promote excessive cannabis use or illegal activity.
Ads “shall not overly burden the legitimate commercial speech of adult use cannabis operators in communicating with adult use consumers,” the advertising section of the initiated statue says. “Notwithstanding, the division of cannabis control may adopt narrowly tailored time and place restrictions preventing advertising targeted to minors.”
Emily Groseclose, the Division of Cannabis Control’s deputy superintendent, defended the rules, pointing to a separate section of the initiated statute that created the Division of Cannabis Control and gives it authority to regulate licensed marijuana businesses.
That includes requiring the division “to adopt reasonable standards for any adult-use cannabis samples, and advertising.”
“These restrictions on billboards are a narrowly tailored advertisement prohibition,” she told the committee. “The restriction on billboards is to prevent targeting to minors.”
DeMora pushed back.
“I read the proposed rules for this, and basically you outlaw everything except the (company) website,” he said. “And they can’t say anything on their website except put their name and what their company does.”
DeMora is referring to a part of the rule that says licensed marijuana businesses can have a web presence with their name, address, contact information and services provided, “which prominently and conspicuously displays the Division of Cannabis Control seal and requires age affirmation of at least eighteen years of age by registered patients and at least twenty-one years of age by adult-use consumers, before gaining access to licensee’s website.”
DeMora said it didn’t make sense that a licensee is allowed to have a sign outside their business but is not allowed to have a billboard along a highway with their name on it.
“It’s the exact same sign, but one’s allowed and one’s not,” he said.
Andrew Makoski, the Division of Cannabis Control’s chief legal counsel, said those signs serve different purposes.
“The way the division would look at these two things is a sign that is attached to your building is much more likely to be aiding someone who’s in the area to locate a specific place where you are located,” he said. “It’s the same reason that we permit monument signs. So, if a dispensary happens to be located in a strip mall, they’re allowed to use a large sign that is outside the strip mall… If it’s on the highway or if it’s sort of out more in the public, that’s more of an advertisement.”
Makoski said there is court precedent on advertising, not related to cannabis, that has drawn this distinction. He noted that the rule largely mimics a rule that existed for medical marijuana.
As part of the master settlement agreement states reached with tobacco companies in 1998, billboards for cigarettes are prohibited, Makoski added.
The master settlement refers to research showing the billboards are a primary driver of youth use of cigarettes and nicotine, he said.
But that ban was part of a settlement to litigation against the nicotine industry, DeMora said.
The committee doesn’t approve agency rules; rather it OK’s them by considering several prongs about whether regulations don’t exceed the statutory authority of an agency, conflicts with existing rules, or has an adverse effect on business, among other standards.
“This is overly burdensome,” DeMora said. “I understand our governor doesn’t like marijuana, but the people of Ohio spoke.”
The Division of Cannabis Control is part of DeWine’s administration.
The committee’s vote was six Republican lawmakers in favor and four Democrats against.
The vote came one day before the Ohio Senate passed a final version of a separate piece of legislation that makes changes to the initiated statute and generally puts intoxicating hemp products in marijuana dispensaries.