In the United States, marijuana is legal to grow and consume for recreational purposes in 24 states, and can be prescribed for medical purposes only in another 16 states. The main holdouts are in the South and a handful of Republican-dominated states in the Midwest and the West. California was the first state to authorize medical use of marijuana in 1996, and Colorado and Washington state were the first to legalize its use for recreational purposes in 2012.
Marijuana remains a Schedule 1 drug under federal law (the Controlled Substance Act of 1970), defined as possessing “a high potential for abuse and no accepted medical use”. However, the federal Drug Enforcement Administration (DEA) over recent years has chosen to not enforce this law in states where legalization has taken place, and the Trump Administration is now in the process of conducting a rulemaking to change marijuana’s status from Schedule 1 to Schedule 3, which would legalize the substance for medical use at the federal level and relax restrictions on research in this area. This step comes after President Trump issued an executive order on this subject last December. Legalization of marijuana for recreational use on a national basis would require Congress to modify existing law.
In 2022, it was estimated that nearly 18 million Americans used marijuana on a daily basis, a figure 20 percent higher than the estimated daily users of alcohol in this country. More than 60 million Americans reported using the drug at least once during the prior year, either as a joint for smoking or consuming THC-laced edible products such as brownies or gummies. The legal marijuana industry recorded revenues of more than $30 billion in 2024 in the United States, although this sector’s output is not included in official U.S. estimates of agricultural production value because of its current illegal status at the federal level. It is believed to be the sixth largest cash crop grown in the United States, just behind major row crops such as corn, soybeans, wheat, and cotton, as well as hay.
Last January, I had an opportunity to tour a facility in Las Cruces, New Mexico devoted to growing marijuana legally and producing a variety of THC-infused edibles and other products for direct sales to consumers. This tour was part of an event that Farm Foundation held in El Paso, TX. It has been legal for residents of New Mexico over the age of 21 to buy and consume such products since April 1, 2022, and this facility began growing its marijuana plants using a hydroponic system a few months in advance of that day so as to have product available when it became legal to sell.
The production of the marijuana crop occurs all indoors, in a facility formerly operated by the large agricultural cooperative Land O’Lakes that housed tens of thousands of egg-laying hens at any given time. The original owner was forced to shut down the facility several years ago due to persistent violations of state and local clean water laws. It was purchased by a family wanting to open up a ‘cannabis grow’ facility within the same premises, and named it the Baked Chicken Farm in recognition of its previous incarnation.
Since the plants are grown indoors under artificial light, this is essentially a year-round operation, and the owners have taken steps to ensure consistent quality and THC content by essentially growing cloned versions of plants of certified high quality cannabis strains, excluding male plants from the growing chambers so as to reduce the risk of diluting those strains.
In addition to the classic marijuana joints, the company manufactures a variety of other products that allow users to enjoy the THC experience legally. These include THC-laced beverages, hand-packed and dried cannabis flowers that allow users to roll their own joints or incorporate into other food products, cannabis concentrate products, THC-infused gummies of various flavors, and THC-infused sleep aids. They also have technicians who are constantly working on new ways to deliver THC to users.
The owner and manager of the facility, Tony Miller, was quite frank about some of the obstacles that his company faces. Although his products are legal to sell and consume in New Mexico, the facility is located within a few minutes drive of the state’s border with Texas, where marijuana use is still a violation of state law. If caught with two ounces or less of marijuana in Texas, users can be charged with a Class B misdemeanor, and subject to jail time of up to 6 months and $2,000 in fines if convicted. If vehicles containing his products are stopped and searched by federal agents at interior checkpoints, both the product and the vehicles may be subject to seizure.
Completion of the federal rulemaking shift for marijuana from a Schedule 1 to a Schedule 3 drug would be beneficial for Baked Chicken Farm (and other legal marijuana growers around the country) because it would make their financial transactions easier and less costly to conduct. Because of their crop’s ambiguous legal status, banks are able to charge these businesses relatively large fees to handle their banking activities (compared to other similar sized businesses), which Mr. Miller indicated would likely be reduced once this rulemaking process is finalized.
Mr. Miller acknowledged that his relatively new business has still not turned a profit, but believes that if some of the barriers described above are alleviated, that status would likely improve. The cannabis grow operation currently uses only a fraction of available space in the facility, but Mr. Wilson believes that a more favorable regulatory environment in the next few years would allow him to expand his operation, creating more jobs in Las Cruces, a town that was hurt financially by the closure of the Land O’Lake operation there, costing them a couple of hundred jobs.
