Southern Maryland Passes Cannabis Fund Ordinance After Months of Debate

Commissioners Approve Cannabis Equity Fund Framework

St. Mary's County Commissioners voted 4-1 to approve the cannabis equity fund ordinance at their July 30 meeting. The measure passed after six months of public hearings that drew testimony from prospective licensees, social equity advocates, and county finance officials. Commissioner Todd Morgan cast the lone dissenting vote, citing concerns over administrative costs and fund oversight mechanisms.

Starting in fiscal year 2027, the ordinance directs 15 percent of local cannabis excise tax revenue into a dedicated equity fund. St. Mary's County collected $1.2 million in cannabis excise taxes during the first six months of 2026, according to county budget documents released in June.

Revenue Allocation and Eligibility Requirements

The fund will provide grants and technical assistance to social equity applicants meeting state-defined criteria. Maryland's Cannabis Reform Act defines social equity applicants as individuals who resided for at least five of the past ten years in a disproportionately impacted area, or who have cannabis-related arrest or conviction records.

St. Mary's County added a local residency requirement: applicants must have lived in the county for at least two of the past five years. That provision drew opposition from the Maryland Cannabis Equity Coalition, which argued the requirement creates an additional barrier not present in state law.

Administrative expenses can't exceed 10 percent of annual fund revenue. A five-member Cannabis Equity Advisory Board appointed by the commissioners will oversee a competitive grant process that distributes the remaining 90 percent.

Advisory Board Structure and Appointment Timeline

The Cannabis Equity Advisory Board will include three social equity applicants, one county business development official, and one member of the county's Office of Economic Development. Commissioners will appoint board members by September 15, 2026, according to the ordinance timeline.

Grant application criteria and scoring rubrics are due November 1, 2026. The first grant cycle opens in January 2027. Awards get announced by March 31, 2027.

Debate Over Local Residency Requirement

The two-year local residency requirement emerged as the most contested provision during the amendment process. Commissioner Eric Colvin proposed the language in May, arguing it ensures fund dollars benefit county residents. Colvin said at the June 18 public hearing that the requirement prevents out-of-county applicants from accessing local tax revenue.

Olivia Chen, policy director at the Maryland Cannabis Equity Coalition, testified that the residency requirement contradicts the state's regional approach to social equity licensing. Chen noted that Maryland's Cannabis Administration doesn't impose county-specific residency rules for social equity applicants.

Commissioners retained the residency requirement in the final ordinance by a 3-2 vote on July 16, with Commissioners Colvin, John O'Connor, and Michael Hewitt voting in favor.

Fund Projections and Fiscal Impact

County budget staff project the equity fund will accumulate $270,000 in fiscal year 2027 based on current excise tax collections. That figure assumes cannabis sales remain flat at current levels. If sales grow at the statewide average rate of 12 percent annually, the fund could reach $300,000 in its first year, according to county finance director Patricia Nguyen.

A sunset provision requires commissioners to review the fund's performance after three years. If fewer than 10 grants have been awarded by June 30, 2029, the fund reverts to the county's general revenue stream unless commissioners vote to extend it.

Implementation and Next Steps

The ordinance takes effect August 15, 2026, following a mandatory 15-day publication period. County staff will begin accepting applications for the Cannabis Equity Advisory Board on August 1. Commissioners will conduct interviews with board candidates during their September 8 meeting.

For full background on this story, see the CannIntel topic hub on Southern Maryland Cannabis Fund. An informational webinar on the grant application process happens October 10, 2026, hosted by the county's Office of Economic Development. Registration details will be posted on the county website by September 1.