The Pakalolo Project: A Sustainable and Equitable Cannabis Future for Hawai‘i

by

SB1613 Alignment and Required Amendments
Pakalolo Project Policy Framework

Overview
Hawaiʻi stands at a crossroads in shaping its adult-use cannabis policy. SB1613 proposes to expand the state’s existing medical cannabis framework under HRS Chapter 329D to accommodate adult-use legalization. While the bill introduces regulatory expansion, it preserves a dispensary-centered market structure that excludes independent farmers and concentrates ownership.

Without corrective amendments, SB1613 risks reinforcing consolidation, creating long-term supply instability, and contradicting Hawaiʻi’s stated goals of sustainability, agricultural resilience, and local economic retention.

The Pakalolo Project supports adult-use legalization only if SB1613 is amended to include farmer-inclusive participation as a statutory pillar of the market.

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  1. Licensing Structure

Current SB1613 Structure
SB1613 maintains the vertically integrated dispensary license model established under HRS 329D. Cultivation, processing, distribution, and retail authority remain consolidated within dispensary licensees.

Issue
This structure excludes independent farmers from licensure and market participation unless they are owned or controlled by a dispensary. It blocks small agricultural operators from entering the legal market and contradicts Hawaiʻi’s broader small business and agricultural policies.

Required Amendment
Establish an Independent Cultivator License category under HRS 329D allowing Hawaiʻi residents to cultivate cannabis for wholesale and limited direct sales without dispensary ownership or control.

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  1. Wholesale and Distribution Rights

Current SB1613 Structure
SB1613 expands intra-state wholesale and transport privileges for dispensaries, including inter-island movement.

Issue
Independent farmers are barred from wholesale participation despite dispensaries receiving expanded logistical authority. This creates a one-sided supply chain where farmers cannot legally supply the market.

Required Amendment
Authorize licensed independent cultivators to wholesale cannabis to dispensaries and licensed processors under state testing, tracking, and compliance systems.

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  1. Supply Chain Adequacy and Market Stability

Current SB1613 Assumption
The bill assumes dispensary expansion will meet adult-use demand.

Issue
Dispensary-owned cultivation alone cannot meet statewide adult-use demand without unrealistic land, labor, and capital expansion. This creates future shortages, price volatility, and justification for outside partnerships.

Required Amendment
Include independent farmers as primary supply participants to stabilize production, reduce shortages, and prevent reliance on multi-state operators.

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  1. Local Ownership and Economic Retention

Current SB1613 Position
The bill references economic development and local benefit but limits ownership pathways.

Issue
Restricting licensure to dispensaries accelerates consolidation and increases the likelihood of MSO acquisition. Profits leave Hawaiʻi, replicating failures seen in tourism and real estate sectors.

Required Amendment
Implement local ownership protections, including residency requirements, ownership caps, and cooperative licensing models that preserve farmer control while enabling scale.

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  1. Agricultural Policy and Sustainability Alignment

Current SB1613 Position
Cannabis remains regulated outside Hawaiʻi’s agricultural sustainability framework.

Issue
Despite being an agricultural crop, cannabis is excluded from policies supporting diversified farming, sustainable land use, and food security. This contradicts state agricultural priorities.

Required Amendment
Formally recognize cannabis as an agricultural commodity and allow licensed farmers to integrate cannabis into diversified crop systems consistent with sustainability goals.

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  1. Direct-to-Consumer Sales

Current SB1613 Structure
Retail authority remains exclusive to dispensaries.

Issue
Farmers are prohibited from selling their product in any form, even under controlled conditions similar to farm-gate or farmers market sales used for food crops.

Required Amendment
Authorize regulated pilot programs allowing licensed cultivators to sell directly to consumers under strict geographic, quantity, and compliance limits, especially in rural communities.

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  1. Equity and Market Access

Current SB1613 Position
Equity is referenced but not operationalized.

Issue
Legacy growers, rural farmers, and small agricultural operators remain excluded from legal participation despite bearing disproportionate enforcement impacts.

Required Amendment
Create reduced-fee licensing tiers, technical assistance, and cooperative entry pathways for Hawaiʻi residents with agricultural or legacy cultivation backgrounds.

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Condensed Policy Summary for Legislators

• SB1613 expands dispensary privileges without correcting structural exclusions
• A dispensary-only model cannot meet adult-use demand
• Excluding farmers invites MSO takeover and off-island profit extraction
• Cannabis should align with Hawaiʻi’s agricultural and sustainability policies
• Independent farmers must be allowed to wholesale and sell directly under regulation
• Without amendment, SB1613 contradicts its own stated economic and equity goals

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Community Next Steps

• Present this framework to legislators and committee members
• Submit this analysis as written testimony
• Align with existing agricultural sustainability and food security reports
• Engage local media to raise public awareness
• Work with farmers and community groups to refine amendment language

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Position Statement
The Pakalolo Project supports adult-use cannabis legalization only if SB1613 is amended to ensure Hawaiʻi’s cannabis industry remains locally owned, farmer-inclusive, and economically sustainable.

Without these amendments, SB1613 risks replicating the same extractive systems Hawaiʻi has already paid for.

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