How ‘Toke-lahoma’ became the hottest market for weed in America

Chip Baker has been an outlaw pot grower since before he could drive.

He began growing marijuana illegally in Georgia at the tender age of 13. From there, Baker embarked on a decades-long illicit career cultivating cannabis.

Over time, he watched as one state legalized. Then another. What Baker never imagined was that red state Oklahoma would be among the pioneers. In 2018, Oklahoma voters legalized medical cannabis by overwhelming margins. After a lifetime of being an outlaw, Baker finally found himself on the right side of the law in Oklahoma.

“Turns out rednecks love to smoke weed,” Baker joked recently to the news site Politico. “That’s the thing about cannabis: It really bridges socio-economic gaps. ... All types of people are into cannabis.”

Despite other states having more mature marijuana markets, Baker realized Oklahoma had some of the best conditions in the nation for rapid growth. There are no caps on the number of cultivation licenses the state will issue. Property in Oklahoma is cheap. Patients can easily obtain licenses for any stated medical condition.

Baker and his wife made the decision quickly to head to Oklahoma where they’re now cultivating 110 acres in the town of Wellston. The land was once used to raise fighting cocks.

After the 2018 legalization, Okies demanded medical marijuana licenses in record numbers. The end of the war on weed in Oklahoma fast became a tax and economic windfall for the state far beyond even the best predictions.

Five years after Oklahoma voters surprised observers and easily passed State Question 788, the actual growth of the industry has obliterated predictions. A lengthy profile from Politico officially dubbed Oklahoma “the nation’s hottest weed market.”

Oklahoma embraces reform

What’s remarkable is just how fast the changes occurred given the state’s reputation to outsiders. Oklahoma has long been known as a law-and-order state with some of the toughest drug laws in the nation. But attitudes toward marijuana started shifting rapidly, both here and across the nation.

California was the first state to legalize medical marijuana in 1996. As of April 3, 2023, the medical use of cannabis has been legalized in 38 states, three territories, and the District of Columbia. As of November 9, 2022, the recreational or adult-use of cannabis has been approved in 21 states, two territories, and the District of Columbia.

Oklahoma isn’t known for celebrating vice. In fact, we’ve long held the dubious title of prison capital of the world. But we also distrust government regulation of private markets and believe businesses should be free to compete. That’s created conditions for an industry that’s grown far beyond predictions in just a few short years.

It’s how Oklahoma chose to write its medical marjuana laws that make the state so unique. Where other states have imposed strict controls of various types, Oklahoma has let markets, customers, patients, and doctors decide what’s best:

• There was initially no cap on the number of business licenses that could be issued statewide (Note: Lawmakers implemented a two-year moratorium on new licenses that took effect in August 2022.)
• The application costs ($2500) are substantially lower than in other states
• Patients and doctors decide what health conditions qualify, not the law
• A new agency for processing applications was created far faster than in other states
• There are fewer restrictions on where cultivators and dispensaries can operate

From criminal to entrepreneur

And it isn’t just out-of-towners like former outlaw Chip Baker fueling the growth.

In just a few short years, 67-year-old grandfather Robert Cox of Norman went from facing several drug-related charges to legally selling medical marijuana. Law enforcers twice raided his store in 2015, The Friendly Market, for selling glass pipes authorities deemed to be drug paraphernalia.

Cox fought the charges all the way to the Oklahoma Supreme Court and won. But mere months after succeeding, Oklahoma voters made Cox’s epic legal journey pointless by passing State Question 788 and legalizing medical marijuana by a sweeping margin. Cox today freely sells both pipes and marijuana with a license issued by the state of Oklahoma.

He’s not alone. Oklahoma has approved over 12,600 marijuana business licenses, including more than 8,600 growers and 2,300 dispensaries.

Even supporters of medical marijuana before the vote in 2008 gave conservative forecasts about just how big the market could become.

“We don’t want people to overestimate the effect this will have,” Frank Grove, chair of the Vote Yes on 788 Committee, said ahead of the election. “It’s about compassionate care more than a revenue-maker.”

Yet Oklahoma is simply buying more pot than anyone expected. At the time of the vote, experts predicted medical marijuana sales might reach $250 million within its first few years. But according to Oklahoma Tax Commission data, statewide dispensaries reported $345 million in total revenue in 2019 and a massive increase to more than $831 million in total revenue in 2020. Since August 2018, the medical marijuana program has generated more than $14 million in revenue for Oklahoma through licenses alone.

Nearly 1 in 10 people in the state -- over 365,000 people -- now hold medical marijuana patient licenses. That’s in a state with a population of fewer than four million people.

Okies are buying so much pot the state was able to cut a check to the Oklahoma Department of Education for $42 million from cannabis revenues just for the 2020 fiscal year. That’s after the state earned enough to cover the $25 million budget of the new Oklahoma Medical Marijuana Authority and set aside a portion of revenue for substance-abuse services.

Tougher in neighboring states

To illustrate just how far Oklahoma has come, Politico points to the oil town of Ardmore near the border with Texas where about 25,000 people live. There are a whopping 36 dispensaries for every 700 residents. One of every 50 people have cultivation licenses in the nearby town of Wilson, population 1,695.

The business licensing fee in Oklahoma is just $2,500.

Compare that with neighboring Arkansas where licenses are much more restricted. There are just eight cultivation licenses in the entire state. A grower there pays $100,000 for the privilege.

Missouri’s process for allocating grow licenses has likewise moved at a glacial pace and been mired in scandal. As a result, there are just 60 grow licenses and fewer than 200 dispensaries today.

Dispensary licenses in Louisiana are also far costlier and restricted to just one for each of nine regions in the state. Colorado has two million more people than Oklahoma. Yet it has half the number of dispensaries and one fifth as many cultivators.

Where some states prohibit dispensaries from operating near schools and daycare centers, it’s impossible to drive more than half-a-mile in Oklahoma City or Tulsa today without spotting one.

“This is exactly like Humboldt County [California] was in the late 90s,” former outlaw grower Chip Baker told Politico about the Oklahoma market. “The effect this is going to have on the cannabis nation is going to be incredible.”

Hitting the Brakes on Legalization

Despite the booming medical cannabis market and increased revenue for the state, advocates of full legalization were stymied at the ballot in March 2023. Oklahoma voters overwhelmingly rejected the recreational use of marijuana, in a movement led by Republican Gov. Kevin Stitt, law enforcement agencies, and religious organizations. The failure of this ballot measure effectively hits the brakes on “the country’s wildest weed market over the last five years.”

Similar referendums have appeared on ballots across the country and outcomes have been unpredictable. For example, voters in Arkansas, South Dakota and North Dakota defeated legalization referendums in November 2022, while voters in Maryland and Missouri approved recreational use.

Legalization supporters are only temporarily deterred. The significant economic benefits will continue to pressure lawmakers, and there are prison reform benefits as well. Legalization would allow people with cannabis-related criminal convictions to expunge their records, as well as give those currently in jail a path to petition to have their sentences reduced or scrapped.