BOTEC Analysis was hired by the State of Washington in 2013 as a consulting firm to develop the rules and regulations for legalized marijuana. Mark Kleiman, the owner of BOTEC died yesterday.
BOTEC stands for “back of the envelope calculation”, which describes well the method required for defining Washington’s marijuana rules then. The state had no experience with the legal market, there were no models in other states to draw from, and there was no data to work with. We didn’t know about cannabis edibles and the special rules they would require, or the need for lab testing. The phenomena of “local prohibition” hadn’t appeared yet. No one had any information on the anticipated size of the market, how many customers there would be, or how much those customers would consume. Kleiman had to build the regulatory environment from scratch, with little factual data. Quite a dangerous situation to be in to invent a billion-dollar industry in a few months.
Washington’s cannabis rules are quite different from other states, and those unique characteristics are, more often than not, attributable to Kleiman himself. Washington doesn’t allow “vertical” cannabis operations (growers can process and sell), there’s a limit on the number of stores state-wide, licensing rules were written to exclude out-of-state operators and corporations, and licenses were distributed across the state based on population.
Many thought Kleiman was going off-track in his proposals, but given that no one knew anything anyway his ideas were adopted. Six years later, I think most people can see the value in most of his ideas, and the problems with a few of his approaches. Overall, his predictions have turned out to be amazingly accurate. Few structural changes have been made to his original plan in Washington.
He continued his work on legal cannabis markets in other states and countries, so when you see a legal market somewhere chances are good that Mark Kleiman had a hand in it. He is being remembered as smart, transparent, courageous, and an all-around nice guy. And we’ll have the legacy of his work around for a long time.