Saturday, August 22, 2015
As reported in this effective local article, headlined "Menominee tribal members approve on-reservation marijuana use," a notable vote among a notable population in Wisconsin this past week ensures tribal marijuana policies and practices will continue to make news in the months ahead. Here are the details of the vote and the challenges it creates:
Now that Menominee tribal members have told their legislators to legalize marijuana, the difficult task begins of designing a profitable weed operation that does not result in the tribe or its customers getting busted. "Tribes are treading on very dangerous grounds" when it comes to growing and selling marijuana, warned Dorothy Alther, director of California Indian Legal Services. "If I was representing tribes out there (in Wisconsin) I would say it might not be such a good idea."
Just last month two California tribes were raided by federal and state authorities who said they seized at least 12,000 marijuana plants and more than 100 pounds of processed marijuana.
Members of the Menominee tribe this week voted 677 to 499 to legalize marijuana for recreational purposes and 899 to 275 to legalize marijuana for medicinal purposes on its 360-acre reservation near Shawano. "This is new ground," Gary Besaw, Menominee chairman, said in an interview Friday shortly after the results were announced. "We have to start looking at developing best practices and draft ordinances to maximize the benefits we believe are possible and minimize the consequences we believe also are possible."
Legalizing marijuana on reservations has become a hot topic since late last year when the U.S. Department of Justice released a memo discouraging federal authorities from prosecuting tribes for growing or selling pot on their reservations. The memo also listed eight scenarios that could result in prosecution, including selling to minors or distributing the product to a state — such as Wisconsin — where weed remains illegal.
State law enforcement authorities do not have criminal jurisdiction on the Menominee reservation but could arrest people who leave the tribal land with marijuana. Federal authorities do, because when the Menominee had its tribal status restored in the 1970s, it became the state's only non-Public Law 280 tribe. "As a white guy I would fully expect that I'm getting pulled over if I drive off the (Menominee) reservation" if marijuana sales there are legalized, said R. Lance Boldrey, a Michigan Indian law attorney.
State and local authorities have jurisdiction over the 10 other tribes in Wisconsin, and at least three of those are seriously looking at legalizing marijuana or a derivative on their reservations. Still, Indian law experts say the Menominee, which has about 9,000 members, must deal with several hurdles.
■ Since marijuana is not legal in Wisconsin, the tribe may be restricted to selling weed only to Native Americans. Still, Besaw said, it could be worthwhile to begin growing and selling weed. He predicted that it won't be long before marijuana is legal throughout the nation and "when it does become legalized we'll be ready to launch," he said.
■ The Justice Department memo is a policy directive that could change, especially in 2017 when a new president takes office, Boldrey said. Rep. James Lankford (R-Okla.) this month sponsored a bill that would take away federal funding from any tribe that cultivates, manufactures or sells marijuana.
■ The tribe must consider the impact of legalizing a drug on an impoverished reservation that has long been plagued with substance abuse problems. "It's a huge concern," Besaw said.
■ It's not clear what to do with money generated from marijuana sales, since federally insured banks generally shun accepting marijuana money for fear of violating federal money laundering laws. Besaw said the tribe would likely avoid that risk by licensing and taxing a business to run the weed business. The tribe's revenue would be "clean money" because it would be tax revenue.
Besaw said he has met and will continue to meet with state and federal law enforcement to determine the guidelines the tribe must operate under to avoid the kind of trouble with the law that occurred in California.
Saturday, August 15, 2015
It's been five months since the historic medical marijuana bill -- the CARERS Act -- was introduced in the Senate, and as Congress enjoys its summer recess, it's a good time to reflect on where the bill is positioned as we head into the second part of the year.
The legislation was introduced in March by Sens. Booker, Paul and Gillibrand, and received huge media attention, including a lead editorial in the New York Times in support of the bill, the day after it was introduced.
The advocacy groups in Washington, D.C. pushing CARERS have spent much of a very successful summer building support for the bill by advocating for the passage of three Senate appropriations amendments that mirror provisions of CARERS. These spending amendments would take effect for one year only, so they are less impactful than the legislative changes we would see through the passage of CARERS, but nonetheless they allowed us to test the waters on support for major provisions of the bill.
The key takeaway from these votes is that the Senate is ready to debate medical marijuana, and a majority would approve the CARERS Act if it was brought to the floor for a vote. The adoption by the Senate of three amendments that are almost identical to provisions in the CARERS Act was a welcome development, not least because every amendment garnered bipartisan support. Perhaps the most important part of CARERS is the section that allows states to set their own medical marijuana policies.
The amendment mirroring this provision passed the Senate Appropriations Committee 21-9, with seven Republicans supporting. The size of the victory demonstrates that, contrary to what some may have said, the Senate is ready to tackle full medical marijuana. Another amendment allowing veterans access to medical marijuana passed 18-12, and an amendment allowingmarijuana businesses to access banking services passed 16-14....
Senators Grassley and Feinstein, whose buy-in is important for CARERS to progress, have gone from being opponents of medical marijuana to holding a recent hearing on the issue, and drafting a Time magazine op-ed on the need for more research and access to certain types of medical marijuana. Sen. Feinstein also secured language in a separate funding bill calling for more research and recognizing "the potential therapeutic benefits that marijuana and its components may bring to patients with serious medical conditions, including seizures, multiple sclerosis, Parkinson's disease, Alzheimer's, substance use disorders, and neuropathic and cancer pain." Sen. Grassley is a crucial player in this process, given that he chairs the Judiciary Committee, through which CARERS must pass.
The bill itself has a lot of momentum behind it -- 15 cosponsors, including 12 Democrats, two Republicans and one independent. The recent addition of Chuck Schumer -- the likely future head of the Senate Democrats and a key Judiciary member -- was another boost. And the bill continues to be regularly praised in the media, including in last Sunday's New York Times editorial.
The next few months will see advocates turn their attention to translating the Republican support for appropriations amendments into cosponsorship for CARERS -- something we need your help with. Advocates will also continue our dialogue with Senator Grassley and push for a Judiciary Committee hearing and vote on CARERS, which would clearly pass the Senate if allowed to move forward. Let's hope the next five months are as successful as the last five.
Some prior related posts:
Wednesday, August 5, 2015
As some readers may know, Section 538 of a spending bill passed late last year by Congress forbids the use of money by the Department of Justice to interfere with State laws implementing medical marijuana programs. The meaning and application of this federal spending limitation on DOJ has been the subject of much dispute and some notable litigation. And now, thanks to postings at this marijuana news site, there are two notable recent developments in this arena:
The first item linked above concerns this notable letter from two members of Congress to the Justice Department's Inspector General concerning Section 538's application and interpretation by DOJ (and which has been reported via various sources). The second item is, as it indicates, an "exclusive," though I see in it an effort to make a bit too much out of some seemingly not-all-that-shocking DOJ advocacy and lawyering.
Friday, July 31, 2015
The question in the title of this post is prompted by this lengthy new Politico article, headline "Congress’ Summer Fling With Marijuana:How Congress turned on the DEA and embraced weed." Here is an excerpt from the first part of the article:
In May, the Senate made history by voting in favor of the first pro-marijuana measure ever offered in that chamber to allow the Veterans Administration to recommend medical marijuana to veterans. Then when June rolled around, it was time for the House to pass its appropriations bill for Commerce, Justice and Science. That’s when things got interesting. The DEA got its budget cut by $23 million, had its marijuana eradication unit’s budget slashed in half and its bulk data collections program shut down. Ouch.
In short, April was a bad month for the DEA; May was historically bad; but June was arguably the DEA’s worst month since Colorado went legal 18 months ago — a turn of events that was easy to miss with the news crammed with tragic shootings, Confederate flags, Obamacare, gay marriage, a papal encyclical and the Greece-Euro drama. July hasn’t been any different, with the legalization movement only gaining steam in both chambers of Congress.
The string of setbacks, cuts and handcuffs for the DEA potentially signals a new era for the once untouchable law enforcement agency — a sign that the national reconsideration of drug policy might engulf and fundamentally alter DEA’s mission. “The DEA is no longer sacrosanct,” Rep. Steve Cohen (D-Tenn.) tells Politico.
The national tide is clearly not in the DEA’s favor. Since Colorado legalized recreational marijuana in January 2014, three additional states have followed suit with full legal weed; the District of Columbia’s fight to legalize continues; the number of medical marijuana states has grown to 23; 14 states have legalized nonpsychoactive CBD oil; and 13 states have legalized industrial hemp, spurring a rapidly expanding legal market for a plant long demonized by the DEA.
At the same time, a national debate about the high costs of sending millions of people — many of them young black and Hispanic men — to prison for nonviolent marijuana offenses has led to increasing questions about whether the zero-tolerance enforcement favored by DEA is the right way to proceed.
That marijuana reform is moving along in Congress at all is a sign of just how far — and fast — the landscape has shifted. Much of the recent uptick of reform voices are actually coming from Republicans, long tough-on-crime legislators who were stalwart opponents of marijuana. In a sign of just how far the sands have shifted, Sen. Lindsay Graham, a Republican candidate for president, tells Politico that he believes, “Medical marijuana holds promise.”
It’s no longer political suicide to be seen on Capitol Hill as backing drug reform. “There clearly is momentum, absolutely,” says Rep. Ted Lieu (D-Calif.), a former Air Force JAG officer who replaced Henry Waxman as the congressman from Beverly Hills. “It’s the first time we’ve ever been able to show momentum in Congress,” Dan Riffle of the Marijuana Policy Project tells Politico.
The looming cuts has the Justice Department issuing dire warnings: “If enacted, the House budget would cause DEA to experience a significant shortfall in their FY16 budget that would severely inhibit their ability to carry out their mission of stopping the manufacture and distribution of illicit drugs,” says Patrick Rodenbush, a spokesman for DOJ. But unlike such dire warnings in the past, when Congress could be assured of protecting funding for a law enforcement agency seen for decades as key to winning the War on Drugs, the shine has now clearly come off DEA — and that means the agency’s problems might just be beginning.
Thursday, July 30, 2015
This new article, headlined "Indian tribes set to begin marijuana sales," reports on the plans and expectations of the first Native American tribe entering the marijuana industry. Here are the details:
Tourists soon may be able to go to a South Dakota Indian reservation, buy a cigarette-sized marijuana joint for $10 to $15 and try their luck at the nearby casino. In December, the Flandreau Santee Sioux expect to become the first tribe in the nation to grow and sell pot for recreational use, cashing in on the Obama administration’s offer to let all 566 federally recognized tribes enter the marijuana industry.
“The fact that we are first doesn’t scare us,” said tribal president Anthony “Tony” Reider, 38, who’s led the tribe for nearly five years. “The Department of Justice gave us the go-ahead, similar to what they did with the states, so we’re comfortable going with it.” The tribe plans to sell 60 strains of marijuana. Reider is hoping for a flock of visitors, predicting that sales could bring in as much as $2 million per month....
Other tribes have been much more hesitant. “Look at Washington state, where marijuana’s completely legal as a matter of state law everywhere, and you still have tribes adhering to their prohibition policies,” said Robert Odawi Porter, former president of the Seneca Nation of New York.
It comes as no surprise to Washington state Democratic Rep. Denny Heck, who says he works on tribal issues every day. “Not once has anybody ever brought up that they wanted to go down this track,” he said. Heck speculated on one possible reason: “We’re all aware of the painful history of alcoholism in Indian Country.”
Tribes won the approval to sell pot in December, when the Justice Department said it would advise U.S. attorneys not to prosecute if tribes do a good job policing themselves and make sure that marijuana doesn’t leave tribal lands. But federal prosecutors maintain the discretion to intervene, a worrisome prospect for many. “This administration is very pro-tribes, very supportive. What if the next one isn’t?” asked W. Ron Allen, chairman of the Jamestown S’Klallam Tribe in Washington state.
He said many of the state’s 29 tribes also want assurances from federal officials that they won’t lose millions of dollars in grants and contracts if they sell a drug banned by Congress. “We’re not getting definitive answers back,” Allen said. “There’s a number of tribes that are very aggressively looking into it and trying to sort through all the legal issues. The rest of us are just kind of on the sidelines watching.”
Many tribal officials took note earlier this month when federal authorities seized 12,000 marijuana plants and more than 100 pounds of processed marijuana on tribal land in Modoc County, Calif. Federal authorities said they raided the operation because the tribes planned to sell the pot on non-reservation land. “That’s a warning shot to Indian County that this isn’t carte blanche to do whatever you want, even in a place like California,” said Blake Trueblood, director of business development for the National Center for American Indian Enterprise Development, based in Arizona.
Trueblood said marijuana could give tribes an economic boost, much like gaming. He said tribes will have the best opportunities in states such as Florida and New York, where demand for pot is high but the drug has not been legalized for recreational use by state voters. “Ultimately, I think you’ll see legal marijuana in every state,” Trueblood said. “I think that’s fairly inevitable, even in very conservative places like Florida.”
Reider said his tribe plans to sell both medical and recreational marijuana. Minors will be allowed to consume pot if they have a recommendation from a doctor. Under a tribal ordinance passed in June, adults 21 and over will be able to buy one gram of marijuana at a time for recreational use, no more than twice a day. “We really don’t want the stuff getting out to the street,” Reider said. “So we’re going to have like a bar setting where they’ll be able to consume small amounts while on the property.”
Kevin Sabet, president of the anti-legalization group Smart Approaches to Marijuana, said the California raid shows that it’s still “an extremely risky venture” for any tribe to start selling marijuana. And he said pot sales would fuel more addiction. “If we think alcohol has had a negative effect on young people on tribal lands, we ain’t seen nothing yet,” Sabet said.
As part of his homework, Reider said, he traveled to Colorado, the first state to sell recreational pot last year. He said he does not smoke marijuana but has concluded that it’s safer than alcohol, citing the behavior he witnessed at the Cannabis Cup, a marijuana celebration held in Denver in April. “It was a peaceful environment,” he said. “Everybody was overly friendly, overly talkative to each other and respectful of each other. Where if you go to a concert where there’s a lot of alcohol, you typically see fights and arguments.”
Reider said the tribe plans to begin growing 6,000 marijuana plants in October and is renovating a bowling alley to house a new consumption lounge that will include four private rooms. He said the tribe may consider allowing marijuana consumption in its casino in the future. Reider acknowledged that it’s “kind of an awkward feeling” to start selling pot, but he figures the tribe is well-equipped.
“When we started looking into it, it’s comical at first, but then you realize it’s an amazing business,” he said. “It’s highly regulated, and we’re used to the regulation from operating our casino. We’ve got security and surveillance.” Reider said profits from pot sales will be used to help tribal members. He said that could include the construction of a facility for those addicted to alcohol, prescription drugs or methamphetamine.
Wednesday, July 22, 2015
The title of this post is drawn from this notable new Time commentary authored by US Senators Dianne Feinstein and Chuck Grassley. The piece is headlined "Break Down Barriers to Medical Marijuana Research," and here are excerpts:
After years of failed treatments [for debilitating seizures, Mallory Minahan's] parents decided to try cannabidiol oil in October 2013. This product is derived from the marijuana plant, administered orally, and has a very low level of tetrahydrocannabinol, or THC, the component of marijuana that makes users high. According to Tom Minahan, Mallory’s father and an ER doctor in Colton, Calif., it took just 36 hours to see profound changes.
But the process hasn’t been easy. A one-month supply of cannabidiol oil, commonly referred to as CBD oil, can cost up to $2,500. Because CBD oil is not approved by the Food and Drug Administration (FDA), there’s no guarantee that the formulation of each batch will be the same, or that each bottle actually contains CBD oil, rather than some other unknown substance.
In fact, the FDA recently sent warning letters to six companies marketing unapproved products that they claim contain CBD, but don’t. This is why Mallory’s parents are forced to spend up to $100 per bottle of oil if they want to have it tested to verify the contents. And even how much of the oil to administer was a mystery. Dr. Minahan and his wife, Carrin, arrived at the proper dosage for Mallory through trial and error.
This isn’t how modern medicine should work. For Mallory, who wasn’t responding to any other treatments or medications, the results were spectacular. Her seizures have decreased by 90%. Yet CBD oil hasn’t been effective for everyone. Many questions remain about its long-term effects and how it interacts with other medications.
Simply put, we need to know more about CBD, and the only way to gain that knowledge is to remove barriers to research. Research will shed light on critical safety issues as well as how effective CBD oil is and the proper formulations and dosages for patients.
After hearing from constituents, we asked the Justice Department (DOJ) and the Department of Health and Human Services (HHS) in October 2014 to clarify their positions on CBD research and what it would take to ensure research could move forward. After some back-and-forth with the two departments, we’re pleased to report that both have taken significant steps to ensure that CBD research can proceed. The DOJ agreed to initiate what is known as an “eight-factor analysis” to definitively determine whether CBD has scientific and medical benefits, and if so the proper schedule for it.
Another key step was HHS’s decision that privately-funded researchers are no longer required to submit research proposals for additional review. It is also allowing Epidiolex, a purified form of CBD currently in clinical trials, to be administered to 400 children under a compassionate use program that allows sick patients to access medicines before they are approved by the FDA.
While these are important developments, they’re not enough.... We need to cut red tape and streamline the licensing and regulatory processes so research can move ahead. In addition, we must also find ways to ensure that researchers have access to the quantity and quality of marijuana that they need. Finally, we need to look at expanding compassionate access programs where possible, to benefit as many children as possible.
Patients like Mallory have helped draw attention to this issue. Now, the federal government should step up, continue to reduce research barriers and help the many patients who could benefit from this treatment.
Tuesday, July 14, 2015
As reviewed by this recent Forbes article, headlined "Big Court Defeat For Marijuana Despite Record Tax Harvests," the Ninth Circuit late last week in Olive v. CIR, No. 13-70510 (9th Cir. July 10, 2015) (available here), affirmed the basic approach that federal authorities have adopted to determining the tax obligations of state-legal marijuana businesses. The Forbes piece provides this overview of the issues and the ruling:
Should marijuana businesses pay tax on gross profits or net profits? It sounds like a silly question. Virtually every business in every country pays tax only on net profits, after expenses. But the topsy-turvy rules for marijuana seem to defy logic. And taxes are clearly a big topic these days under both federal and burgeoning state law.
Many observers and legislators suggested that legalizing marijuana would mean huge tax revenues. With legalized medical marijuana now giving way to more and more states legalizing recreational use, the cash hauls look ever more alluring. Washington state regulators say the state collected $65 million in first-year taxes from recreational marijuana sales in just 12 months on cannabis sales of over $260 million from June 2014 to June 2015. In Colorado, the governor’s office estimated that it would collect $100 million in taxes from the first year of recreational marijuana....
Now ... the IRS has convinced the influential Ninth Circuit Court of Appeals that marijuana dispensaries cannot deduct business expenses, must pay taxes on 100% of their gross income. The case, Olive v. Commissioner, was an appeal from a U.S. Tax Court decision. Martin Olive sold medical marijuana at the Vapor Room, using vaporizers so patients do not even have to smoke.
But even good records won’t make vaporizers or drug paraphernalia deductible. The Ninth Circuit upheld the Tax Court ruling that § 280E prevents legal medical marijuana dispensaries from deducting ordinary and necessary business expenses. Under federal tax law, the Vapor Room is a trade or business that is trafficking in controlled substances prohibited by federal law....
On the question whether marijuana businesses should pay tax on their net or gross profits, the tax code says the latter. Indeed, Section 280E of the tax code denies even legal dispensaries tax deductions, because marijuana remains a federal controlled substance. The IRS says it has no choice but to enforce the tax code.
One common answer to this dilemma is for dispensaries to deduct expenses from other businesses distinct from dispensing marijuana. If a dispensary sells marijuana and is in the separate business of care-giving, for example, the care-giving expenses are deductible. If only 10% of the premises is used to dispense marijuana, most of the rent is deductible. Good record-keeping is essential, but there is only so far one can go. For example, in the case of the Vapor Room and Martin Olive, with only one business, the courts ruled that Section 280E precluded Mr. Olive’s deductions....
The IRS is clear that you can deduct only what the tax law allows you to deduct. The trouble started in 1982, when Congress enacted § 280E. It prohibits deductions, but not for cost of goods sold. Most businesses don’t want to capitalize costs, since claiming an immediate deduction is easier and faster. In the case of marijuana businesses, the incentive is the reverse. So the IRS says it is policing the line between the costs that are part of selling the drugs and others.
Sure, deduct wages, rents, and repair expenses attributable to production activities. They are part of the cost of goods sold. But don’t deduct wages, rents, or repair expenses attributable to general business activities or marketing activities that are not part of cost of goods sold.
2013′s proposed Marijuana Tax Equity Act would end the federal prohibition on marijuana and allow it to be taxed – at a whopping 50%. The bill would impose a 50% excise tax on cannabis sales, plus an annual occupational tax on workers in the field of legal marijuana. Incredibly, though, with what currently amounts to a tax on gross revenues with deductions being disallowed by Section 280E, perhaps it would be an improvement. More recently, Rep. Jared Polis (D-Co.) and Rep. Earl Blumenauer (D-Or.) have suggested a phased 10% rate here, ramping up to 25% in five years.
Sunday, July 12, 2015
The title of this post is the headline of this extended new article from the Sioux Falls Argus Leader concerning notable marijuana developments in South Dakota. Here are excerpts:
Five months from now, according to the plan, Indians and non-Indians alike will be smoking marijuana on tribal lands in Flandreau.
The U.S. Justice Department told Indian tribes last December that they can grow and sell marijuana as long as they follow the same federal conditions laid out for Washington, Colorado and other states that have legalized the drug. For the tribe and Colorado-based Monarch America, hired to design, construct and develop a grow facility on the Flandreau reservation, that has opened the door to a potentially rich new business enterprise — just as the advent of casino gambling did decades ago.
They intend to open by the first week of December, says Monarch America CEO Eric Hagen, who adds, with a smile, "Everyone will have a merry Christmas."
South Dakota Attorney General Marty Jackley isn't as confident of that. While he insists he's having positive talks with Flandreau officials about his concerns as they move forward on their project, Jackley says the future of marijuana on the reservation isn't so black and white. He called the Justice Department's Cole Memorandum — authored in August 2013 by Deputy Attorney General James Cole to address the legalization of marijuana in states like Washington and Colorado — a complex directive that has created confusion on the tribal front.
While Hagen believes that memorandum allows tribal marijuana ventures in any state, Jackley questions whether it was meant to apply only to tribes in states that have legalized marijuana. South Dakota isn't one of those states. That said, he believes anyone with marijuana in their bloodstream or in their physical possession is in violation of state and federal law, including non-Indians on tribal lands and Indians who go off reservation.
"I want to encourage tribal leaders to continue to work with state authorities to better ensure ... that both Indian and non-Indian persons are not put in harm's way by the jurisdiction complexities being created by our federal government," he said.
That's not Hagen's perspective. The feds have said they aren't going to prosecute the growing or selling of marijuana by state or tribal jurisdictions that have legalized it as long as they are doing a strong job of regulating that growth and distribution and addressing infractions, he said.
The Justice Department's bigger concern, outlined in eight priorities in the Cole Memorandum, is to keep marijuana out of the hands of minors. They don't want marijuana revenue going to criminal enterprises. They don't want marijuana that is legal in one state diverted to places where it isn't legal.
Hagen insists Flandreau will have stricter regulations than any state with legal marijuana cultivation and consumption statutes on the books now. And because of that, "I think people just need to know that when they come on to tribal lands to partake ... that it's a safe haven for them whether you're a tribal member or not," he said. While he believes anybody in South Dakota with marijuana in their system or in their possession could be arrested, Jackley doesn't envision a situation where law enforcement will simply camp out and wait to arrest people coming out of a tribal lounge.
One of the other big concerns for the Flandreau tribe will be keeping track of its marijuana. Law enforcement in Flandreau say they worry about where the tribal marijuana might end up. Hagen said that shouldn't be an issue, not with the "radio frequency identification (RFID) inventory and tracking system" his company is helping the tribe put in to follow marijuana "from seed to sale, ensuring products do not leave designated areas."
"I personally don't believe it will remain in the building," Flandreau Police Chief Anthony Schrad said. "You can purchase the marijuana in the lounge, but it seems to me it would be very easy to remove the RFID tag from the container you purchase it in, transfer the marijuana to your own personal vial and leave with it."
Friday, July 10, 2015
The title of this post is the headline of this new Politico story. Here are the details of a notable (but not likely consequential) legislative development in Congress:
Reflecting growing public support for changing the nation’s drug laws, a bipartisan group of senators on Thursday introduced the chamber’s first bill that would legalize banking for recreational marijuana companies. Introduced by the Senate delegations from Oregon and Colorado, two of the first states to legalize recreational marijuana, the bill would prohibit the federal government from penalizing banks that work with marijuana businesses.
Though four states and the District of Columbia have legalized marijuana, the drug is still illegal under federal law. That makes it difficult for businesses operating in those legalized states to access financial services through the banking industry. Instead, those companies have to run all-cash operations that the senators say invite crime. The entire legal landscape that legal marijuana currently faces is “insane,” said GOP Sen. Cory Gardner of Colorado in an interview....
Congress has been extraordinarily hesitant to address the nettlesome issue of marijuana law. Another landmark bill for the Senate from Rand Paul (R-Ky.), Cory Booker (D-N.J.) and Kirsten Gillibrand (D-N.Y.) that would legalize medical marijuana in states that have approved it has run into opposition from the Senate’s old guard.
But the upbeat Gardner noted that Sen. Orrin Hatch (R-Utah) now supports a bipartisan bill that would exclude cannabidiol, which has more medicinal uses, from the definition of marijuana in federal law. He said Congress will come along, eventually. “Now, does it have a chance? I think there’s a lot of work that has to be done to give it that chance, but I also think that in 10 years most every other state in the country is going to be facing this question,” Gardner said. “People are coming on board and people are starting to realize we have a policy that’s kind of out of step.”
July 10, 2015 in Business laws and regulatory issues, Campaigns, elections and public officials concerning reforms, Federal Marijuana Laws, Policies and Practices, Recreational Marijuana State Laws and Reforms | Permalink | Comments (0)
Wednesday, July 8, 2015
The question in the title of this post is prompted by this notable new and lengthy Politico magazine piece headlined "The Senate's experiment with cannabis: Hardliners on Judiciary open up to research on medical pot." Here are excerpts:
Congress has resolutely opposed the state-level movements toward legalizing marijuana, keeping it a Schedule I controlled substance on par with heroin, LSD and peyote. But now some of the nation’s toughest law-and-order senators just might be opening the window to cannabis, at least a crack.
Sens. Chuck Grassley (R-Iowa), Orrin Hatch (R-Utah) and Dianne Feinstein (D-Calif.) have all begun speaking up about the need for more clinical research on the marijuana plant compound known as cannabidiol, or CBD. The three sit on the powerful Judiciary Committee, which has a key voice in setting the federal government’s firm stance on pot in all its different forms.
They sent a clear signal in a packed hearing room last week, when the senators took on the tricky issue of CBD, a compound derived from an illegal drug but which many scientists and public health officials believe could treat conditions including cancer, diabetes, chronic pain, and alcoholism. Some parents and doctors have already turned to CBD as an anti-seizure medicine for children who suffer from rare and extreme types of intractable epilepsy.
Grassley, the chairman of the powerful Judiciary panel, told the audience at a narcotics caucus meeting that it's not an “inconsistent position" to embrace the beneficial components of the pot plant even while rejecting pretty much everything else about the drug, adding that doctors prescribe morphine but don’t recommend their patients go out and smoke opium or heroin. Feinstein and Hatch also spoke about the potential benefits from CBD, and complained that current drug laws impede the parents of sick children from access to what appears to be a helpful medicine.
At the same time, the senators went through elaborate motions to explain they weren’t softening their stance against recreational pot. “I have deep concern that [pot] does more harm than anything else,” Feinstein said in an interview. “But in terms of the medical aspects of it, it’s a totally different picture. It’s like any other plant. I’m sure there are other plants that if you ate you’d hallucinate or something. But if you can get the beneficial parts out, get them researched, be able to standardize it, regulate it, you may have something very good.”
The lawmakers’ comments, coming on the heels of two recent Obama administration moves to expand medical-marijuana research, marked another pointed moment in the country’s shifting views on drug policy. What was once an absolute red line in the “Just Say No” era is now a more porous border. Twenty-three states and Washington D.C. have legalized medical marijuana; Alaska, Colorado, Oregon, Washington state and the District of Columbia have also legalized recreational use, despite the clash with federal drug laws.
Congress, so far, has made no moves at all to relax recreational marijuana laws, and in Washington D.C. – where it effectively holds veto powers over the local government’s affairs – it prohibited the city from spending money to implement its voter initiative on recreational use. As a result, the nation’s capital considers marijuana legal but doesn’t have any sales and taxation system....
Utah, Hatch noted, was “certainly no redoubt of hippie liberalism,” but in March 2014 became the first of 15 states to legalize use of the CBD oil. Now, he's pushing the Senate to pass a bipartisan bill that would remove CBD from the definition of marijuana under federal law, giving parents a green light to buy the medicine without the threat of DEA agents busting them.
One sticky issue on the cannabis front has been that its outlaw status makes it more difficult to carry out both government and privately funded research. While it’s technically legal to study the medical aspects of pot, researchers must go through a rigorous DEA and FDA approval process, and can only obtain their marijuana from the government’s sole authorized U.S. supplier, located at the University of Mississippi.
While Grassley rarely has praise for Team Obama, he applauded the Democratic administration for two moves it made in June on the medical-research front: the Department of Health and Human Services got rid of what it called a duplicative 16-year old paperwork review requirement for private researchers studying the drug; and separately, the Justice Department and HHS moved to study whether CBD should be classified on a less stringent level than the entire marijuana plant. “This is a significant breakthrough and I commend these agencies for agreeing to take this step,” Grassley said.
The feds are in part playing catch-up with the black market, where parents using the oil extracts for their children say they’ve spent as much as $2,500 for a month’s supply. Feinstein said she hears complaints from constituents in California and around the country that they have bought CBD without labels, factory seals or clear dosage amounts. “This is an untenable situation. It is not how medicine should work,” Feinstein said. Her goal, she said, was "to get this process expanded, and get it legitimized and get it regulated. And I think those are the things we have to do and do as quickly as we can.”...
Despite their interest, Feinstein and her colleagues were circumspect still about how far Congress will go this session. The House in June included several pot-related amendments to a spending bill funding the Commerce, Justice and State departments; one measure adopted on a 297-130 vote allows states that have legalized cannabidiol to do it without federal interference; another prohibits the federal government from blocking states from implementing their own medical marijuana laws. (President Barack Obama signed a similar provision into law in last year's "CRominbus" spending bill, but the language lapses at the end of the fiscal year.) The House also narrowly rejected an amendment – on a 206-222 vote – that would have told the feds to butt out in the implementation of any state marijuana laws, either recreational or medical.
In the Senate, Cory Booker (D-N.J.), Kirsten Gillibrand (D-N.Y.) and Rand Paul (R-Ky.) are leading an effort for a broader medical marijuana bill that would help make the drug available for a range of conditions, including cancer, glaucoma and for children via the CBD extract. Their legislation would block the federal government from halting state medical marijuana laws; permit doctors at the Department of Veterans Affairs to prescribe the drug to military veterans; allow banks to do business with medical marijuana dispensaries and let states import the CBD oils for treatments. The senators also want to change how marijuana is classified under the Controlled Substances Act – moving it from the most restrictive Schedule 1 category that limits its use for research and defines it as having no accepted medical benefits into the Schedule 2 category that comes with fewer requirements before it can be studied.
In an interview, Gillibrand said it was a "huge deal" to have Grassley, Hatch and Feinstein supportive of expanding cannabis research. “I think it’s the first step toward a fuller conversation on how important medical marijuana is to so many patients across the country," she said.
But Gillibrand still has work in front of her if she wans to pick up their support for many of the specifics in her bill. Grassley, who has been a high-profile partner with Gillibrand on legislation tackling sexual assault crimes in the military and on college campuses, said he wasn't ready to ally with the Democrat yet on medical marijuana legislation.... And when asked if she backed the push to reclassify marijuana as a Schedule 2 controlled substance, Feinstein – who represents a state that legalized medical marijuana nearly 20 years ago – replied: “I’m not there yet.”
Personally, I have a "deep concern" that Senator Feinstein may do "more harm than anything else" if she is still clinging to a refeer madness view of marijuana as the most hamful of all drugs. But, especially if Senator Feinstein still does have a unsupportable view as to the harms of marijauana, the fact that even she is now talking up the importance of some medical marijuana reform perhaps is a great sign for the overall reform movement.
Monday, June 29, 2015
Senator Orrin Hatch has this notable new op-ed piece in the Washington Times headlined "The curative side of cannabis: A medical extract offers relief for epileptic children." Here are excerpts:
[Imagine] you hear about a new therapy that has shown remarkable success in treating children just like yours — children with intractable epilepsy. But there’s a problem: The therapy is made from a strain of the cannabis plant. The therapy doesn’t produce any sort of “high.” In fact, it’s made from a strain of cannabis that’s so low in THC — the active ingredient in marijuana — that it has no psychotropic effect even when ingested in large quantities. But because the therapy comes from the cannabis plant, it’s classified as marijuana under federal law and is therefore illegal.
As a devoted, loving parent, you’re faced with an impossible dilemma. Do you break the law to obtain a therapy that could cure or at the very least substantially reduce your child’s devastating seizures? Or do you allow your child to continue to suffer? Remember, the therapy produces no high, and it carries none of the dangerous side effects of traditional marijuana. It simply comes from the same source.
This hypothetical scenario is a reality for tens of thousands of parents. The therapy is called cannabidiol oil, or CBD for short. It’s administered by placing a small amount under the tongue, and has been shown to reduce seizures by more than 90 percent in children with intractable epilepsy. It is not addictive.
But because it’s made from the cannabis plant, CBD is illegal under federal law. To solve this problem, I’ve recently sponsored bipartisan legislation with Sens. Cory Gardner, Colorado Republican, Ron Wyden, Oregon Democrat, and others to exempt CBD from the definition of “marijuana” under federal law.
Our bill, S. 1333, will allow parents to obtain a life-changing therapy for their children without threat of federal prosecution. It’s colloquially known as the Charlotte’s Web Act, after Charlotte Figi, an eight-year-old girl who has seen extraordinary improvements from taking CBD. Prior to beginning treatment with CBD, Charlotte suffered as many as 300 grand mal seizures per week — seizures so violent that her parents put a do not resuscitate order in her medical records. After Charlotte started taking CBD, however, her seizures dropped dramatically. She now suffers, on average, less than three seizures per month and is able to engage in normal childhood activities. “Dateline NBC” and National Geographic recently highlighted the medical benefits of CBD for children with severe epilepsy.
CBD is not medical marijuana. It cannot be used to get high. Its only use is for epilepsy and other medical conditions. Nor is it a camel’s nose in the tent for advocates of full marijuana legalization. Fifteen states have now legalized CBD. These include some of the most rock-ribbed conservative states in the country, such as Alabama, South Carolina and Texas. In fact, my home state of Utah — certainly no redoubt of hippie liberalism — was the very first state to legalize CBD.
Throughout my entire Senate career, I’ve taken a strong stand against illegal drugs. The proliferation of cocaine, meth and other addictive, mind-altering substances has had a devastating effect on homes and communities. CBD is not like any of those substances. It is not addictive. To the contrary, it has shown promise in treating addiction. Rather than harming families, it can help make their lives better.
I continue to oppose marijuana and efforts to legalize its use. I remain unconvinced by claims that it is safe and that the side effects it causes are no big deal. Stories of children being rushed to the hospital for accidentally consuming marijuana edibles belie the notion that marijuana is a safe drug. In fact, I am currently working on legislation to help protect children from the dangers of edible marijuana products.
But I also believe that when a drug is safe and can improve people’s lives, Congress should not stand in the way. That CBD is derived from the cannabis plant does not mean we should be scared to have anything to do with it. Legalizing CBD is a compassionate, common-sense move that will bring relief to thousands of suffering children. I am glad to stand with my colleagues in supporting the Charlotte’s Web Act and look forward to helping it move through Congress and to the president’s desk.
Thursday, June 25, 2015
It is justifiably hard for me and others to take too seriously Donald Trump's bid for the GOP presidential nomination. Nevertheless, given that some polls indicate some GOP voters are taking "The Donald" seriously and especially given Trump's ability to get more media attention than most other GOP candidates, I think it may be time for serious marijuana reformers to seriously explore candidate Trump's current positions and perspectives on marijuana reform in particular and the broader drug war more generally. Perhaps unsurprisingly, a quick Google search reveals that The Donald has through the years had talked about, but not always talked consistently about, drug policies.
As noted in this recent MSNBC piece, way back in 1990 "a thick-haired Donald Trump was telling a crowd in South Florida that 'We’re losing badly the war on drugs. You have to legalize drugs to win that war. You have to take the profit away from these drug czars'." In a similar vein, this unofficial 2012 review of the views of possible Prez candidates sets forth this account of the "Trump position on Marijuana":
• Donald Trump has never smoked marijuana.
• He would legalize it and tax it.
• He thinks that legalization would save a lot of money in our prisons and courts and profit the states.
However, before would-be marijuana reformers get too revved up considering cannabis capitalism under a President Trump Administration, this recent report on comments by Trump at the 2015 CPAC conference suggests that, as I have highlighted below, The Donald's marijuana reform views may still be evolving:
Trump said he has several agenda items should he become president, and his top item is to destroy the Islamic State.... In a lightning round with [Sean] Hannity, Trump also said that he is pro-life, with the exceptions of cases involving the life of the mother, rape, or incest; against legalized marijuana, unless it's medical marijuana, which he supports; and he believes Hillary Clinton botched Benghazi, her husband is a "nice guy" with a lot of problems coming up; and Obama is "an incompetent president."
To the extent Donald Trump could and and will be taken seriously as a GOP presidential candidate, I think we can and should expect him to generally be a voice for more pro-business, free-market domestic policies. Consequently, it will be interesting to watch if and when he is pressed on both his past and current positions on removing government restrictions on marijuana businesses and on recent failed drug war government efforts to eradicate illegal drug markets.
As regular readers surely realize, I tend generally to favor modern marijuana reform efforts. Consequently, I tend generally to notice and feel most inspired to blog about research and press reports that tend generally to favor modern marijuana reform efforts. But I fully recognize, and generally have respect for, the many policy-makers and advocates who strongly oppose modern marijuana reform efforts.
Especially because I think it is critical in this space and elsewhere that competing voices are heard and dynamic perspectives considered in modern marijuana reform debates, I am ever grateful for the efforts of Kevin Sabet and his group SAM: Smart Approaches to Marijuana for covering and promoting reform-opposition research and developments. And, and these recent posts from the SAM blog highlight, SAM has has a lot to say on these topics over just the last 10 days:
- SAM President Kevin Sabet gives testimony before United States Senate Caucus on International Narcotics Control
June 25, 2015 in Assembled readings on specific topics, Business laws and regulatory issues, Federal Marijuana Laws, Policies and Practices, Medical Marijuana Commentary and Debate, Political perspective on reforms, Recreational Marijuana Commentary and Debate | Permalink | Comments (2)
Members of the Senate are attempting to finish off where the White House started earlier this week, by calling for the removal of additional barriers still in place that they believe are limiting scientific study on the effects of marijuana.
At a hearing of the Senate Caucus on International Narcotics Control Wednesday, members challenged representatives from the Drug Enforcement Agency, Federal Drug Administration and the National Institute on Drug Abuse on the current process for approving marijuana studies. "I understand the desire for caution. We're Congress, we act slowly. But these are people who need the help, for who a five- to 10-month delay is a death sentence," said Sen. Orin Hatch, R-Utah.
The hearing specifically looked at the effects of cannabidiol, a derivative of marijuana, on patients. Many members and witnesses spoke of anecdotal evidence that the drug helped children with chronic epilepsy when nothing else would. However, large-scale studies on the link have been rare, largely in part of heavily controlled federal government approval of marijuana research.
The hearing came on the heels of White House action earlier this week that removed a key government hurdle blocking many scientific marijuana studies from moving forward. The White House action means scientists will no longer have to submit research proposals to the Public Health Service Review (PHS) at the Department of Health and Human Services to get a green light for marijuana research.
But while the move, which was announced Monday, signals a shift in federal policy, many caution that there remain significant barriers to studying the drug’s positive medical effects on humans. Marijuana advocates point out that the PHS was only one of three major hurdles limiting research. The other two -- the fact that researchers can only use marijuana from a single government-owned dispensary at the University of Mississippi and classifying marijuana as a Schedule I drug -- endure.
Senators Kirsten Gillibrand, D-NY, and Corey Booker, D-NJ, are two key members of Congress who are fighting for more studies on the effects of the drug. Earlier this year they introduced a bill, along with Sen. Rand Paul, R-KY, that in addition to getting rid of the now-defunct PHS review, would downgrade marijuana from a Schedule I drug, up there with heroin, to a Schedule II, in the line with opiates.
Both senators were guests at the caucus hearing and took no time to challenge witnesses from the various government agencies present. A fiery Gillibrand challenged NIDA and the National Institute for Health's strict control of cannabidiol. NIDA representatives said one drug company had a patent on cannabidiol. Many fear this control over the drug will limit future research options. Gillibrand shot back saying, "Let's be clear, we have to change the laws to remove the impediments so that we have research across the country."
Whether it be cannibidiol or marijuana in general, supporters say much still needs to be done to study the drug and get it available on markets where medical marijuana is legal. “Arguably the largest hurdle in this process still remains in place,” Paul Armentano, deputy director at the National Organization for the Reform of Marijuana Laws said. “That is that government policy … mandates that all clinical protocols must utilize government grown cannabis provided by NIDA.”...
While attitudes may be changing, led by President Obama himself, and including DEA efforts to expand the availability of marijuana for studies, progress remains slow. As a result, many members of Congress are getting in on efforts to streamline the regulatory process in hopes that it may make the drug available to those who need it.
Just last May, Reps. Earl Blumenauer, D-Ore., Morgan Griffith, R-Va., Jane Schakowsky, D-Ill., and Dana Rohrabacher, R-Calif., wrote a letter to the Secretary of HHS asking her to remove the PHS barrier. In a statement Monday, Blumenauer called the White House’s decision “a significant step toward improving an antiquated system that unfairly targets marijuana above and beyond other substances in research.” He said, however, there still remains a lot to be done and said he’s working on legislation to address the remaining blockades.
While more and more lawmakers’ acceptance of marijuana’s role in medicine might be a welcome surprise, some marijuana supporters are skeptical that additional marijuana studies will significantly change federal policy. “Ample scientific research already exists to contradict cannabis’ federal Schedule I status -- as a substance without medical utility, lacking acceptable safety, and possessing a high potential of abuse,” Armentano said. “More research is welcome, but unfortunately science has never driven marijuana policy. If it did, we would already have a very different policy in place.”
Tuesday, June 23, 2015
As explained in this helpful new Washington Post piece, a "long-standing bureaucratic obstacle to privately-funded medical marijuana research has just been removed, effective immediately." Here are the details
Until today if you wanted to conduct marijuana research, you'd need to do the following:
- Submit your study proposal to the Food and Drug Administration for a thorough review of its "scientific validity and ethical soundness."
- Submit your proposal to a separate Public Health Service (PHS) board, which performs pretty much the exact same review as the FDA.
- Get a marijuana permit from the Drug Enforcement Administration.
- Finally, obtain a quantity of medical marijuana via the Drug Supply Program run by the National Institute on Drug Abuse (NIDA), which maintains a monopoly on medical marijuana grown for research in the U.S.
As you might imagine, this can be a complicated, time-consuming process. Step 2, the PHS review, has been a subject of particular consternation among researchers and advocates. That step is not required for research into any other drug, including cocaine and heroin.
The PHS review is nearly identical to the one performed by the FDA. Sometimes, it can take months to complete. In recent years, advocates of overhauling marijuana laws, researchers, members of Congress, and even marijuana legalization opponents have called for the PHS review to be eliminated in the name of streamlining research.
This week, the Department of Health and Human Services agreed, determining that the PHS review process is redundant with the FDA review, and that it is "no longer necessary to support the conduct of scientifically-sound studies into the potential therapeutic uses of marijuana."
"The president has often said that drug policy should be dictated by unimpeded science instead of ideology, and it’s great to see the Obama administration finally starting to take some real action to back that up," said Tom Angell of the Marijuana Majority, a pro-legalization group.
Even those who oppose legalization agreed. "I think it's a sensible change; but people are being delusional if they think this will result in a flood of research on the drug," said Kevin Sabet of Smart Approaches to Marijuana, an anti-legalization group. "But it's a step in the right direction as the development of a non smoked cannabis medication goes forward."...
There are still more bureaucratic hurdles to marijuana research than to research in any other drug. NIDA's monopoly on legal marijuana production doesn't exist for any other drug, meaning that heroin and cocaine remain easier for researchers to work with. "The next step should be moving marijuana out of Schedule I to a more appropriate category, which the administration can do without any further Congressional action," said Angell. "Given what the president and surgeon general have already said publicly about marijuana’s relative harms and medical uses, it’s completely inappropriate for it to remain in a schedule that’s supposed to be reserved for substances with a high potential for abuse and no therapeutic value."
June 23, 2015 in Federal Marijuana Laws, Policies and Practices, Medical community perspectives, Medical Marijuana Commentary and Debate, Medical Marijuana Data and Research, Medical Marijuana State Laws and Reforms, Who decides | Permalink | Comments (0)
Tuesday, June 16, 2015
The quoted portion of this post comes from the headline of this recent Reason piece by Jacob Sullum, which canvasses at length the comments made by 2016 presidential candidates about whether they would respect state effort to reform their marijuana regimes in the shadow of federal prohibition. Here is how the piece starts and ends:
Last week New Jersey Gov. Chris Christie reiterated his intention to crack down on marijuana in states that have legalized it if he is elected president. In an interview on Face the Nation, Christie answered "yes" when asked whether he would "return the federal prosecutions in these states," "yes" when asked if he would "go after" marijuana, and "correct" when asked if legalization would be "turned off."
If he were president, Christie could make a lot of trouble for state-licensed growers and retailers, but he would not actually have the power to make Colorado, Washington, Alaska, and Oregon recriminalize marijuana. Furthermore, any attempt to override the decisions made by voters in those states would arouse strong objections — and not just from supporters of legalization. Illustrating that point, another Republican presidential contender, former Hewlett-Packard CEO Carly Fiorina, disagreed with Christie. "Colorado voters made a choice," she said in a Fox News interview last Tuesday. "I don't support their choice, but I do support their right to make that choice."
As I noted in March, that stance is pretty common among Republicans seeking their party's presidential nomination, and it seems politically smart, since even voters who hate marijuana do not necessarily think the federal government should force prohibition on states that do not want it. A recent Pew Research Center survey found that three-fifths of Americans think the feds should not "enforce federal marijuana laws" in states that have legalized pot. Even more striking: A 2012 CBS News survey found that 65 percent of Republicans thought "laws regarding whether the use of marijuana is legal or not should be…left to each individual state government to decide," even though only 27 percent supported Colorado-style legalization....
In short, Chris Christie's determination to stamp out marijuana legalization puts him in the minority among presidential candidates, among Republicans, and among the general public. "I don't believe that people want to be told just what they want to hear," he said on Face the Nation. "I believe they want to be told the truth as the person who is running sees it." There's a startling proposition: In 2015, it seems, promising to keep marijuana illegal counts as courage.
June 16, 2015 in Campaigns, elections and public officials concerning reforms, Federal Marijuana Laws, Policies and Practices, Recreational Marijuana Commentary and Debate, Recreational Marijuana State Laws and Reforms, Who decides | Permalink | Comments (0)
Wednesday, June 3, 2015
House of Representatives again votes to limit federal interference with state medical marijuana programs
As reported in this AP piece, headlined "GOP-Controlled House Backs State Medical Marijuana Laws," today brought a number of notable federal votes on federal marijuana enforcement funding. Here are the details:
The federal government would be unable to block state laws permitting the use of medical marijuana under legislation approved Wednesday by the GOP-controlled House. But lawmakers narrowly rejected an amendment that would stop the Justice Department from interfering with states like Colorado and Washington that permit the recreational use of marijuana.
The 242-186 vote on medical pot was a larger margin than a tally last year, when the House first approved it as part of a bill funding the Justice Department. Wednesday's vote was to renew the pro-pot language as part of a bill providing funding for the coming fiscal year. The overall measure passed by a mostly party-line vote.
Most Republicans opposed the idea and the Senate is in GOP hands this year, so the outcome could still be reversed. But Senate advocates of medical marijuana won a test vote in the GOP-controlled Appropriations Committee last month.
On Wednesday, 67 Republicans, including libertarian-minded lawmakers such as Thomas Massie of Kentucky, combined with all but a handful of Democrats in support of states that allow doctors to prescribe pot for medical uses, such as improving the appetites of cancer patients undergoing chemotherapy....
The amendment to allow recreational pot use, offered by conservative Rep. Tom McClintock, R-Calif., was rejected by a surprisingly narrow 222-206 vote. McClintock's measure had less GOP support and more Democratic opposition than did the amendment on medical marijuana. "This is not an argument for or against marijuana," McClintock said. "This strictly involves the rights of citizen in various states to regulate commerce that occurs entirely within their own borders."
Monday, June 1, 2015
Former federal prosecutor: "Legal Marijuana Dealers -- And The Government -- Need Bankers And Lawyers"
The title of this post is drawn from the headline of this notable new Forbes commentary by Matthew L. Schwartz, who for a decade served as a federal prosecutor and is now partner at Boies, Schiller & Flexner. Here are excerpts from an important piece:
It is not unusual for legal marijuana businesses to become entangled in government investigations. Although it wasn’t my focus, as a former federal prosecutor I sometimes investigated unlawful drug trafficking organizations. Following the drugs and money back to their source increasingly led to marijuana businesses in states that had legalized it.
In many cases, the “legal” marijuana business was knowingly involved in the unlawful distribution. But on more than one occasion, legitimate marijuana businesses were victims of circumstance. In one case, for example, a licensed grower in California had a handful of workers who were diverting a portion of the crop to a criminal organization. In another case, a dispensary in Colorado was purchasing unlawfully-produced marijuana. In both cases, the guilty were arrested and the innocent business owners were not, but the businesses were adversely affected – each was the subject of a government investigation, its premises were searched by law enforcement agents, and its bank accounts and property were subject to seizure.... Companies without stringent compliance programs are particularly at risk.
As a result, virtually every bank of any size has decided not to do business with legal marijuana companies, concluding that the so-called “regulatory risk” outweighs the benefits of doing business with them.... Major law firms, ever risk-averse, have also decided not to advise marijuana companies... [because] most major law firms have decided that the risk that they will be deemed an aider and abettor of criminal activity makes advising marijuana businesses untenable....
The lack of access to banks and lawyers is a problem not only for legal marijuana businesses, but for regulators and law enforcement, as well. Though marijuana remains a controlled substance, legalized marijuana is a reality in many states – and arguably an inevitability, even at the federal level – and it is in the government’s interest for companies in that market to have robust compliance programs. Likewise, the government has no desire for marijuana businesses to be conducted in cash: the use of cash makes it significantly harder for the government to trace the proceeds of the marijuana businesses, not to mention the fact that businesses that deal in large volumes of cash present opportunities for robbery and other crimes of violence. But for marijuana money to be both traceable within the legitimate financial system and subject to stringent compliance programs – both within the marijuana businesses and at the institutions that handle their money – means having access to banks and lawyers....
Until marijuana businesses have regular access to the financial system and can turn to a broad array of sophisticated lawyers for counsel, they will remain half-way in the shadows. This is by no means an argument for legalizing marijuana; it doesn’t have to be legal for marijuana businesses to have access to professional services. Last month, the Marijuana Business Access to Banking Act was introduced in the House of Representatives; among other things, it would prohibit banking regulators or criminal prosecutors from investigating or penalizing a financial institution for “providing financial services to a marijuana-related legitimate business.” Congress could easily pass similar protections for lawyers. Doing so would recognize a basic proposition: when a bank or a lawyer provides services to a legal marijuana business, it is not helping that business to break the law. To the contrary, lawyers and banks – especially sophisticated and responsible ones – help businesses to comply with the law. That helps the marijuana business and government alike.
June 1, 2015 in Criminal justice developments and reforms, Federal Marijuana Laws, Policies and Practices, Medical Marijuana Commentary and Debate, Recreational Marijuana Commentary and Debate, Who decides | Permalink | Comments (0)
Wednesday, May 27, 2015
The title of this post is the headline of this notable International Business Times article, which gets started this way:
Marijuana might be legal in the country’s capital, but not for employees of the U.S. government. The sobering reminder came in the form of a new guidance issued Wednesday by the Office of Personnel Management. It stated that federal workers, even those living in states where marijuana is legal, are subject to federal, not local, law – and all the penalties that come with it.
“Heads of agencies are expected to advise their workforce that legislative changes by some states and the District of Columbia do not alter federal law, existing suitability criteria or Executive Branch policies regarding marijuana,” Katherine Archuleta, director of the Office of Personnel Management, said in a statement posted on the agency’s website. The guidance doesn’t change existing laws barring federal employees from participating in activities the government considers illegal. It simply underscores a point that may have gotten lost in the shuffle, or that some government employees might rather forget.Twenty-three states and D.C. have legalized medical marijuana. Three states – Colorado, Oregon and Washington – along with D.C. allow pot to be consumed for medical and recreational purposes. The drug remains illegal at the federal level, despite the Department of Justice having promised not to challenge states that decide to legalize it.
The U.S. government employs roughly 4.1 million Americans. About half a million of them live in the District of Columbia, which legalized recreational pot in February.
Friday, May 22, 2015
The title of this post is the headline of this notable new piece reporting on a notable recent vote in the US Senate. Here are the basics from the start of the article:
The Senate Appropriations Committee on Thursday advanced a $77.6 billion funding bill for military construction and veterans benefits that includes an amendment allowing Veterans Affairs doctors to recommend the use of medical marijuana.
The amendment from Sens. Jeff Merkley (D-Ore.) and Steve Daines (R-Mont.) won approval in an 18-12 vote. Sen. Mark Kirk (R-Ill.), the chairman of the subcommittee that oversees the funding bill and a veteran of the Navy Reserve, urged his colleagues to vote against the amendment.
A 2011 directive by the Veterans Health Administration prohibits agency doctors from consulting patients about medical marijuana use. “It’s an enormous inconvenience to our veterans,” said Merkley, who explained that current law forces veterans to seek a medical appointment outside of the VA.
House Democrats attempted to add a similar amendment to the lower chamber’s version of the bill, but failed to win enough votes. Overall, the bill is $5.5 billion above the current funding level, but $1.2 billion less than President Obama’s request. The House passed its version of the bill late last month, about $1 billion less than the Senate’s.