Oklahoma’s Cannabis Market Resets: Key Takeaways from OMMA’s 2024 Report
Oklahoma’s medical marijuana industry is no longer the free-for-all it once was. If anything remains wild about the “wild west of weed,” it’s how sharp of a contraction the industry saw over the last fiscal year. According to the OMMA Fiscal Year 2024 Annual Report, the number of commercial grow licenses has been nearly halved, marking a dramatic shift in the state’s cannabis market.
For years, Oklahoma’s low barriers to entry fueled a booming industry, leading to a largely under-regulated and oversaturated market. But with stricter enforcement, an ongoing moratorium on new licenses and increasing compliance demands, thousands of cannabis businesses have shut down or failed to renew their licenses. With this report, OMMA has shown it is no longer a passive regulator—it is actively reshaping the market through enforcement and oversight.
OMMA has directly defined its role and mission within the medical marijuana industry as to “Promote public health and safety through regulation and enforcement of responsible medical cannabis practices by patients and commercial licensees.”
Businesses that remain operational now face a landscape with fewer competitors and greater scrutiny. Compliance is more critical than ever as OMMA continues to ramp up inspections, administrative actions and regulatory oversight. To highlight this, the report’s key features were that OMMA:
Helped seize more than 96,000 plants and 24,000 pounds of illicit marijuana.
Conducted more than 50 undercover operations through the Secret Shopper program, closed more than 800 business complaints and participated in over 100 investigations.
Assisted other regulatory agencies and law enforcement partners 265 times.
Filed more than 1,400 administrative cases against business licensees that were not in compliance with OMMA rules and regulations.
Source: OMMA 2024 Fiscal Year Report
The agency’s crackdown means that businesses still cutting corners face critical risks, while those prioritizing compliance and sustainability might finally have an opportunity to solidify their position in the market.
While there has been a lot of pain along the way, in an ideal world, a shrinking saturated market intensifies healthy competition among remaining players, driving them to innovate and implement sustainable practices to capture a larger share of the finite medical patient population—and in turn delivering them more premium products or unique offerings.
Industry Landscape: Grow Licenses Cut by 44%
The era of “anyone with a credit card and a dream can take a crack at becoming a marijuana millionaire” is officially over in Oklahoma. The number of active commercial grow licenses has declined by 44% in a single fiscal year, reflecting the state's shift toward a more tightly controlled and regulated market.
Source: OMMA 2024 Fiscal Year Report
This market contraction is driven by multiple factors, chief among them the licensing moratorium extended through 2026, which has effectively locked out new growers. Simultaneously, intensified enforcement against “non-compliant” operations, coupled with rising costs and stringent compliance demands, has made it increasingly difficult for small-scale businesses to survive.
Another major issue is the significant lag in processing license applications and renewals. We have nearly 100 clients who have been waiting on renewals since early 2024—some now facing overlapping renewal cycles without their prior applications being processed. This bureaucratic bottleneck has left businesses in limbo, forcing some to cover expenses for an entire year without the ability to operate or generate revenue. For example, applicants attempting to transfer operations to new locations or update ownership have been caught in a regulatory standstill, continuing to pay for a license and location they can’t utilize while compliance costs escalate. Many operators have simply been drained financially before ever being able to begin.
While some industry casualties were inevitable, it’s difficult to argue commercial licensees received a fair shake. OMMA has a statutory obligation to process licenses within 90 business days, yet these delays have persisted well beyond that timeframe. In her statement within the report, OMMA’s Executive Director Adria Berry acknowledges these issues, attributing them in part to new legislation. While that may be true, the retroactive application of these laws to applications that should have already been processed and facilities the Authority itself previously approved has created an unfair and deeply unfortunate situation for many honest business owners caught in the crossfire.
The Financial Impact of Licensing Reductions
With nearly 44% fewer commercial grow licenses in Oklahoma, the state has lost or will lose roughly $8 million in annual licensing fees from growers alone. That’s a substantial drop, but it hasn’t disrupted OMMA’s operations—because its budget no longer depends on licensing revenue directly.
Instead, OMMA now operates with a fixed $37 million budget appropriated by the Legislature, separate from the taxes and fees collected from cannabis businesses. This means that even as licensing revenue has dropped, OMMA’s funding remains stable. Though how long that will remain sustainable, or what other efforts (1,400+ administrative hearings) will be made to close the gap remains to be seen.
Despite a 44% reduction in grower licenses, Oklahoma’s excise and sales tax revenue has remained relatively stable, with only a 2.3% decline in sales tax collections from $67.3 million to $65.7 million year-over-year. This not-so-dramatic drop suggests that consumer demand remains strong as it adjusts to recent market shifts.
Source: OMMA 2024 Fiscal Year Report
Budget Breakdown: Where OMMA’s $37 Million Goes
As mentioned previously, beginning FY 2024, OMMA no longer receives excise tax revenue directly. Instead, the agency operates on a fixed $37 million budget appropriated by the Legislature. This budget covers the costs of compliance, enforcement, licensing operations, and administration.
Here’s how OMMA’s $37 million budget is allocated:
73.5% ($27.2 million) – Payroll
The majority of OMMA’s budget goes to staff salaries, covering compliance officers, enforcement personnel, and administrative staff.
Source: OMMA 2024 Fiscal Year Report
16.5% ($6.1 million) – Information Technology (IT)
This includes costs for licensing software, system maintenance, digital infrastructure, and equipment.
8.1% ($3 million) – Non-IT Contracts and Expenses
Covers office rental, vehicle costs, administrative fees, and interagency invoices.
1.9% ($716,000) – Non-IT Equipment and Supplies
Includes vehicles, uniforms, and other operational tools.
Additionally, tax revenue from cannabis sales is now directed into the Medical Marijuana Tax Fund, which is distributed as follows:
75% to public education (Department of Education & Teachers’ Retirement Fund).
25% to substance abuse programs (State Health Department & Department of Mental Health & Substance Abuse Services).
For years, industry professionals have asked, “Where is all the tax and licensing money going?” OMMA’s detailed budget breakdown answers that question.
This level of transparency, accentuated by OMMA involving industry players in 2024’s rulemaking process is a positive step forward in providing accountability and re-establishing trust with the industry. However, real relationship repair with the industry will take follow through that is as bold as OMMA’s communicated vision for the future.
That said, OMMA also cut 10% of its staff this year framing it as a way to maximize taxpayer dollars at a time when licensing and administrative inefficiencies had/have left hundreds of businesses in limbo. So while the transparency is appreciated, serious concerns remain about whether cutting staff will further slow an already backlogged system and if OMMA will continue to shift resources toward enforcement rather than streamlining operations.
Balancing Oversight with Efficiency
If OMMA truly wants to “promote public health and safety through regulation and enforcement of responsible medical cannabis practices by patients and commercial licensees,” it must ensure that its own administrative processes are not actively harming compliant businesses.
Stricter enforcement and compliance crackdowns may help weed out bad actors, but if legitimate operators are unable to retrofit facilities, renew licenses, relocate or remain in good standing due to bureaucratic inefficiencies, then OMMA is failing to uphold its mission. When enforcement outpaces the efficiency of licensing, renewals and other critical regulatory measures, the system itself becomes a roadblock.
As OMMA continues to shape the future of Oklahoma’s medical cannabis industry, it must hold itself to the same regulatory standards and accountability measures that it enforces on licensed businesses.
Oklahoma’s cannabis market is consolidating, tax revenue remains stable and OMMA is fully funded to operate. The next critical step is ensuring that regulation serves the industry rather than stifling it. A well-regulated market depends not just on enforcement but on a system that is efficient, transparent and responsive to the businesses it oversees. Compliance is essential, but so is a regulatory framework that fosters stability, predictability and long-term sustainability.
One of the most anticipated improvements on the horizon is OMMA’s planned Quality Assurance Lab, which could finally bring standardized product testing, address lab inconsistencies and improve patient safety. A functional, well-regulated cannabis market needs both enforcement and infrastructure and this lab represents a long-overdue step toward ensuring medical cannabis patients receive safe, accurately tested products.
This was a hard year for licensees from our perspective. OMMA’s enhanced transparency and involvement in industry rulemaking mark meaningful steps toward a more stable and regulated market. However, real trust will be built not just through oversight, but through fair and efficient execution.
We know many in this industry have been frustrated and we’ve felt it too. But in any relationship, if you truly want repair, you have to be open to the efforts. OMMA is making efforts and while skepticism is warranted, outright dismissal risks missing opportunities for progress. We hope that next year’s report is able to place less emphasis on celebrating enforcement victories and more on what OMMA has done to foster a balanced, sustainable industry—one that prioritizes stability for businesses, accessibility for patients and a regulatory framework that supports both compliance and long-term growth.
