Was this a vote against legalization? In that case, why is it seen as the first step toward legalization? I'm not arguing, just asking.

People objected to having a preordained monopoly for pot sales. Hopefully next time a clean amendment can be voted on and passed.

A hundred or so rich investors (the vast majority from out of state) wanted Ohioans to vote to give them a monopoly on growing and wholesaling pot in Ohio in exchange for legalizing it. To create an Ohio pot cartel, and to enforce it by using police to crack down on anyone not in the cartel. Oh, there was a supposed exception that anyone could grow four plants personally (bought FROM the cartel), but in order to use it, you also had to agree to let the police come in and search your home any time they felt like it, to make sure you weren't growing more than four plants, and didn't have an 'excessive' amount of non-cartel pot on hand.

Pretty much dictionary fascism, with agents of the state used to protect the monopoly powers of a corporation.

When Ohioans are ready to legalize, they'll be ready to LEGALIZE, and treat pot like they do any other agricultural crop. Food and safety inspections for retailers, wholesalers, and processors, and free to be grown in gardens alongside flowers and vegetables.

ETA -

He was one of the 10 "farmers" who would have had exclusive right to grow on his land.

I do have to say that I am a bit confused by Issue 2- I thought anti-monopoly issues were dealt with by the Sherman Anti-Trust Act. ??? I am guessing that that has been worked around so much that something at the state level was felt needed....or was #2 directly countering #3?

Technically, I suppose with ten different groups of investors having farms, it would not be considered a monopoly. This was a double tap to 3 - A) if both had passed, it would have gone to the courts to decide whether to kill 3 outright, or simply to kill off the part about it being limited to those 10, and B) if 3 failed, as it did, it would prevent them from putting pretty much the exact same issue on the ballot in the future, forcing them to actually rely more on people actually wanting legal pot, and not simply making another attempt to 'buy' the vote with deep pockets of speculators.

My next question is actually - how does this affect casinos in Ohio? Is it just not retroactive, so it ignores similar limited for profit enterprises already established? Or does it open it up to further casinos to weaken the existing ones?

I wouldn't have voted for it either, based on the following.

http://www.commondreams.org/views/2015/11/04/defeat-marijuana-legalization-ohio-says-lot-about-kind-economy-people-are-sick-and

Leaving aside heated rhetoric about the evils of “Big Pot,” the fact is that, had Issue 3 passed, it would have established a system of elite and most likely absentee ownership, as opposed to community-based family businesses. Voters recognized the need for local, broad-based ownership as the foundation of a thriving, resilient economy.

Issue 3 was created by a decision-making process led by private interests, excluding local residents. Voters sent a message that they want more voices at the table.

While much was said about the jobs a new legalized marijuana industry would create, there was no guarantee that those jobs would offer decent wages or dependable employment. There was a clear preference for a business model that offers inclusive, living wage jobs that help families from all walks of life enjoy economic security.

Finally, under Issue 3 the business of marijuana would have been the business as usual of wealth inequality. Resentment on this point was pervasive, particularly because there is such a culture of entrepreneurialism and private growth, created by marijuana’s longtime illegal status.

MPP is supporting several of the 2016 initiative efforts. It neither supported nor opposed the Ohio initiative this year.

“It’s pretty obvious that the outcome in Ohio does not reflect where the nation stands or the direction in which it is heading when it comes to marijuana policy. It only reflects where Ohio voters stand on a specific and rather unique proposal in an off-year election. It will not have any bearing on the outcomes of the initiatives that we expect to appear on other states’ ballots in 2016.

“When voters in Nevada or Massachusetts get to the ballot box one year from now, they are not going to be thinking about what happened in Ohio a year earlier. They are going to be thinking about the problems marijuana prohibition has caused their states for so many years and the benefits of replacing it with a more sensible system. These initiatives will also benefit from heightened voter turnout during a presidential election year. The more voters that turn out, the more support we tend to see for marijuana policy reform.

“Polls show a strong and growing majority of Americans think marijuana should be legal for adults. There is a lot of momentum building behind the movement to end marijuana prohibition heading into 2016. Election Day was relatively uneventful this year, but next year it will be truly historic.”

...and then worked to overturn the rule setting aside only 10 companies to grow it. That could probably have been challenged and overturned in the courts.