Community Statement on SB1613. Cannabis Dispensary Expansion and Required Safeguards

Hawai‘i stands at a crossroads in shaping its adult use cannabis policy.

During the 2025 Legislative Session, Senate Bill 1613 was introduced as a proposal to expand Hawai‘i’s existing medical cannabis framework toward an adult use market. The bill advanced through multiple Senate committee hearings but was ultimately removed from decision making before final passage. SB1613 did not become law.

The discussion around SB1613 exposed a deeper structural problem in Hawai‘i’s cannabis policy. Proposed frameworks continued to favor vertically integrated dispensaries while leaving local farmers without a meaningful pathway into the legal market. The Pakalolo Project uses the lessons from SB1613 to outline what future legislation must address to protect Hawai‘i’s economy, agriculture, and communities.

This framework reflects what Hawai‘i needs going forward, not what was enacted.

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Policy Context and Legislative Gap

SB1613 focused primarily on expanding dispensary operations under the existing medical cannabis system. While it acknowledged sustainability and economic growth, it failed to establish enforceable mechanisms to include independent farmers in the supply chain.

Without farmer inclusion, any adult use framework risks repeating the same structural imbalance that already exists. Dispensaries retain control over cultivation, processing, and retail, while local agricultural operators remain excluded.

This imbalance creates three predictable outcomes.
• Market consolidation
• Dependence on outside capital
• Long term loss of local economic control

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Key Issues Identified Through SB1613

Disproportionate Authority for Dispensaries
Dispensaries maintain exclusive control over production scale, wholesale distribution, and expansion opportunities. Independent farmers lack licensing pathways to participate directly in the market.

Risk of Multi State Operator Expansion
When local production remains limited to a small number of license holders, market pressure invites partnerships with large mainland operators. This shifts ownership, profits, and decision making outside Hawai‘i.

Economic Leakage
Industries dominated by outside capital consistently extract wealth from the islands. Cannabis policy that excludes local farmers follows the same pattern seen in tourism and real estate.

Supply Chain Constraints
A dispensary only cultivation model does not scale to meet adult use demand. Production bottlenecks lead to shortages, higher prices, and regulatory pressure to expand corporate cultivation rather than local farming.

Misalignment With Sustainability Policy
Hawai‘i promotes diversified agriculture and food security while restricting farmers from participating in one of the state’s highest value crops.

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The Pakalolo Project Policy Framework

The Pakalolo Project proposes a farmer inclusive adult use cannabis model designed to keep Hawai‘i’s cannabis industry locally owned and operated.

Core principles include:
• Local ownership
• Agricultural participation
• Supply chain resilience
• Community scale economics

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Proposed Structural Solutions

Farmer Inclusive Licensing
Create cultivation licenses specifically for small and mid scale farmers that operate independently of dispensary ownership.

Dual Pathway Sales Model
Allow farmers to supply dispensaries through regulated wholesale channels and participate in direct to consumer sales through licensed farm based markets.

Local First Production Standards
Prioritize Hawai‘i grown cannabis through production thresholds and licensing preferences tied to in state cultivation.

Cooperative Models
Allow farmers to form cooperatives to pool resources for processing, distribution, and compliance while retaining independent ownership.

Targeted Tax Incentives
Provide tax benefits for locally grown cannabis to strengthen in state production and reduce economic leakage.

Pilot Programs
Establish rural pilot programs to test farm based retail and distribution under controlled regulatory conditions.

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Why This Matters Now

SB1613 did not pass, but adult use cannabis legislation will return. The structure of future bills will determine whether Hawai‘i builds a sustainable local industry or repeats a dispensary dominated model that excludes farmers and exports profits.

A farmer inclusive framework:
• Strengthens rural economies
• Aligns cannabis with existing agricultural policy
• Reduces reliance on outside operators
• Keeps wealth circulating locally

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Condensed Talking Points

• SB1613 advanced but did not become law.
• The bill exposed structural gaps in farmer inclusion.
• Dispensary only models concentrate power and restrict supply.
• Local farmers must participate for sustainability and equity.
• Adult use policy should reflect Hawai‘i’s agricultural values.

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Next Steps for Community Participation

• Share this framework with lawmakers and policy staff.
• Submit testimony advocating for farmer inclusive licensing.
• Engage media outlets with data driven analysis.
• Align cannabis policy proposals with existing sustainability and agriculture plans.

Future legislation must reflect Hawai‘i’s people, land, and economy. The Pakalolo Project exists to ensure that outcome.