Marijuana Law, Policy & Reform

Editor: Douglas A. Berman
Moritz College of Law

Wednesday, July 14, 2021

Great early coverage of US Senate Leader Chuck Schumer's "discussion draft" of new Cannabis Administration and Opportunity Act

6a00d8341bfae553ef0223c85155dc200c-320wiSince nearly the start of this year, Senate Majority Leader Chuck Schumer, along with  Senators Ron Wyden and Cory Booker , has been talking up the introduction in the US Senate of a new comprehensive federal marijuana reform bill.   That talk has suggested that reform efforts from these Democratic Senators would be similar to, but still quite distinct from, the Marijuana Opportunity Reinvestment and Expungement (MORE) Act, that has moved forward in the House of Representatives in recent years.

Today, in mid July 2021, these Senators have scheduled a press conference to unveil what is being described as a "discussion draft" of a lengthy federal bill titled the Cannabis Administration and Opportunity Act (CAOA).  The full text of this CAOA "discussion draft" is available here and it runs 163 pages(!).  In other words, CAOA give marijuana reform advocates (and opponents) a whole lot to discuss.  Helpfully, the cannabis press core is already doing great job covering the basic:

From Marijuana Moment, "Here Are The Full Details Of The New Federal Marijuana Legalization Bill From Chuck Schumer And Senate Colleagues."  Excerpt:

Perhaps the most immediately consequential provision would be a requirement that the attorney general to remove marijuana from the Controlled Substances Act within 60 days of the bill’s enactment.  But it’s important to keep in mind that this legislation—like other federal legalization bills moving through Congress—would not make it so marijuana is legal in every state. The proposal specifically preserves the right of states to maintain prohibition if they way. It stipulates, for example, that shipping marijuana into a state where the plant is prohibited would still be federally illegal.

However, the measure would make it clear that states can’t stop businesses from transporting cannabis products across their borders to other states where the plant is permitted.  FDA would be “recognized as the primary federal regulatory authority with respect to the manufacture and marketing of cannabis products, including requirements related to minimum national good manufacturing practice, product standards, registration and listing, and labeling information related to ingredients and directions for use,” according to the summary.

From Politico, "Schumer launches long-shot bid for legal weed." Excerpt:

The discussion draft of the Cannabis Administration and Opportunity Act includes provisions that cater to both “states rights” Republicans and progressive Democrats. While the proposal seeks to remove all federal penalties on weed, it would allow states to prohibit even the possession of cannabis — along with production and distribution — a nod to states’ rights.  It would also establish funding for a wide range of federal research into everything from drugged driving to the impact cannabis has on the human brain. The measure aims to collect data about traffic deaths, violent crime and other public health concerns often voiced by Republican lawmakers.

On the flip side, the proposal also includes provisions that are crucial to progressives.  That includes three grant programs designed to help socially or economically disadvantaged individuals, as well as those hurt by the war on drugs and expungements of federal non-violent cannabis offenses.  States and cities also have to create an automatic expungement program for prior cannabis offenses to be eligible for any grant funding created by the bill.

A few of many prior recent related posts:

July 14, 2021 in Business laws and regulatory issues, Campaigns, elections and public officials concerning reforms, Federal Marijuana Laws, Policies and Practices, History of Marijuana Laws in the United States, Political perspective on reforms, Who decides | Permalink | Comments (0)

Tuesday, July 13, 2021

"Higher Me: Marijuana Regulation in the Workforce and the Need for State Legislated Employee Protections"

The title of this post is the title of this new paper recently posted to SSRN and authored by Lily Boehmer, a recent graduate of The Ohio State University Moritz College of Law.  (This paper is yet another in the on-going series of student papers supported by the Drug Enforcement and Policy Center.)   Here is this latest paper's abstract:  

Although illegal under federal law, states have increasingly pushed the cannabis legality boundary by legalizing the use of recreational and medicinal marijuana at the state level. In the space between diverging federal and state law, such actions have created a dire situation for employees; employees in states that have legalized the use of marijuana can be fired for arguably legal conduct. Legalization of hemp and cannabidiol (CBD) products increase the risk of termination and litigation for employees and employers. State legalization is not what it purports it to mean.

This paper examines the current legal framework of cannabis regulation, discusses the historical, legal precedent of an employer’s right to terminate an employee in contrast to recent case law providing protection and hope to employees, and analyzes why some employers have stopped marijuana drug testing in response to faulty testing and diminished applicant pools.  Ultimately, this paper argues that, absent federal legalization of marijuana, states must protect employees’ off-duty marijuana use through express state legislation.  Legalization cannot be fully actualized until employees can use marijuana without employment repercussions.

July 13, 2021 in Business laws and regulatory issues, Employment and labor law issues, Medical Marijuana Commentary and Debate, Recreational Marijuana Commentary and Debate | Permalink | Comments (0)

Sunday, June 27, 2021

"Seeds of Change: Strategies to create an equitable cannabis industry"

Download (9)The title of this post is the title of this notable new report authored by Janessa Bailey with Leafly.  I recommend the full report's explanation, accounting and scoring of various aspect of social equity in cannabis reform.  Here is how the report gets started:

Over the past decade, cannabis legalization has offered new economic opportunities to hundreds of thousands of people across the United States.  But those opportunities have not been extended to all Americans.

In the nine years since Colorado and Washington first legalized marijuana for all adults, we’ve learned that past inequities and current barriers aren’t erased by simply declaring cannabis legal.

The systems of discrimination built into 80 years of prohibition won’t be erased by hope and wishful thinking. Their dismantling requires proactive steps on the part of state and municipal policymakers.

Cannabis is the nation’s fastest-growing industry.  As of June 2021, 38 states have some form of legalized cannabis, with 19 states and Washington, DC, allowing legal use for all adults.  The $18.3 billion dollar industry now supports 321,000 full-time American jobs, and cannabis entrepreneurship and employment have exploded over the past five years.

But as legalization and the growing cannabis industry have expanded, it has become increasingly clear that opportunities in cannabis are not fairly accessible to all Americans.

Seeds of Change offers eight strategies to create a fair and equitable cannabis industry, assesses each legal adult-use state on its implementation of those strategies, and illuminates the often-hidden barriers that contribute to the current disparities in cannabis.

In other words: Here’s what’s needed, here’s how legal states are doing, and here’s why these strategies are necessary.

June 27, 2021 in Business laws and regulatory issues, Race, Gender and Class Issues, Recreational Marijuana Commentary and Debate | Permalink | Comments (0)

Tuesday, June 1, 2021

Rounding up some recent marijuana news and reform notes as the calendar turns

The Memorial Day weekend serves as the unofficial start to summer and today is the official start of June, and so I figured it was a good time to catch up with a bunch of recent notable stories from major outlets that I have not found time to blog about recently.  So here goes:

From CNBC, "Uber and the delivery war could be headed to cannabis dispensaries"

From Forbes, "Republican Voter Suppression Is Canceling Marijuana Legalization"

From Pew Research Center, "Religious Americans are less likely to endorse legal marijuana for recreational use"

From Politico, "Why Covid rules on liquor, pot and telemedicine might last past the pandemic"

From the New York Times, "Why the Pandemic Was a Breakout Moment for the Cannabis Industry"

From the New York Times, "Yes, Pot Is Legal. But It’s Also in Short Supply."

From NPR, "After 50 Years, U.S. Opens The Door To More Cannabis Crops For Scientists"

From the Wall Street Journal, "Positive Marijuana Tests Are Up Among U.S. Workers"

 

Also, the always great Marijuana Moment has these two notable recent op-eds:

By Shaleen Title, "Congress Only Has One Chance To Legalize Marijuana The Right Way"

By Matthew Schweich, "The War On Ballot Initiatives Has Marijuana In The Crosshairs"

June 1, 2021 in Business laws and regulatory issues, Employment and labor law issues, Recreational Marijuana Commentary and Debate, Religion, Who decides | Permalink | Comments (0)

Friday, May 28, 2021

"Marijuana Tax Revenue in States that Regulate Marijuana for Adult Use"

DownloadThe title of this post is the title of this notable new report and accounting from folks at the Marijuana Policy Project.  Here is how it gets started (with my highlight):

Legalizing marijuana for adults has been a wise investment.  Since 2014 when sales began in Colorado and Washington, legalization policies have provided states a new revenue stream to bolster budgets and fund important services and programs.  As of May 2021, states reported a combined total of $7.9 billion in tax revenue from legal, adult-use marijuana sales.  In addition to revenue generated for statewide budgets, cities and towns have also generated hundreds of thousands of dollars in new revenue from local adult-use cannabis taxes.

Eighteen states have enacted laws legalizing, taxing, and regulating cannabis for adults 21 and older.  Eight of the laws passed in 2020 or 2021, and in seven of those states, licensing and tax collections have not yet begun.  This document reviews each state’s adult-use cannabis tax structure, population, and revenue from legalization.  It does not include medical cannabis tax revenue, application and licensing fees paid by cannabis businesses, additional income taxes generated by workers in the cannabis industry, or corporate taxes paid to the federal government.

The report provides a helpful overview of all the basic tax structures in place for adult-use marijuana as of May 2021, as well as reports on total collections in these states to date. Notably, while Colorado is often thought about as the first legalization state and California is rightly seen as the biggest legalization state, this report details that Washington is as of now the richest state in tax revenues with over $2.5 billion collected.  (But California's tax revenue in 2020 was nearly twice that of Washington's according to this report, so by 2022 we should expect the Golden State to have collected the most tax gold from adult-use marijuana legalization.)

May 28, 2021 in Business laws and regulatory issues, History of Marijuana Laws in the United States, Recreational Marijuana Data and Research, Recreational Marijuana State Laws and Reforms, Taxation information and issues | Permalink | Comments (0)

Monday, May 10, 2021

Guest-post: "Tax Provisions in State Constitutions May Hinder Marijuana Legalization Efforts"

6a00d83451574769e20224df387165200bI was very pleased to have received the following guest post content from Professor  Andrew D. Appleby of Stetson University College of Law:

Although the recreational marijuana movement has gained momentum at the state level, several states may be unable to legalize recreational marijuana because of tax limitations in their state constitutions.  A primary motivation for legalization is increased tax revenue, and every state that has legalized recreational marijuana also taxes it.  Many states, however, have broad constitutional provisions designed to make tax increases more difficult, most notably provisions that require supermajority approval to create or increase any tax.  There appears to be a third wave of these tax supermajority provisions proliferating. Florida voters approved a constitutional provision in 2018 and several other states, including New York in 2021, have considered supermajority approval provisions.  These provisions have several unintended consequences, as discussed in my forthcoming article, "Designing the Tax Supermajority Requirement."

These provisions impact recreational marijuana in several ways.  Most state tax supermajority provisions apply only to the legislative process, so many states are forced to use the voter approval process for marijuana legalization efforts.  Prior to 2021, only two states had legalized recreational marijuana through the legislative process.  Neither state has a tax supermajority requirement, and neither state would have satisfied the requirement.  Vermont was unable to include a tax provision in its initial legalization bill and needed to enact a separate tax statute two years later.  Three states legalized recreational marijuana through the legislative process in 2021.  None of the legislation passed with two-thirds supermajority approval.

Recreational marijuana is still divisive in many states for many reasons, particularly as it remains illegal federally, so achieving supermajority approval is difficult.  Even in politically liberal states, recreational marijuana legalization voter initiatives have passed by narrow margins.  In the 2016 election year, for example, the Massachusetts initiative passed with 53% of the vote and the California initiative garnered only 57% approval.  Four states legalized recreational marijuana through ballot initiatives in 2020.  Only New Jersey achieved supermajority approval, and just barely, with 67% voting in favor.  South Dakota, which has a tax supermajority provision and “one subject” provision in its constitution, had its legalization initiative declared unconstitutional, with the South Dakota Supreme Court currently considering the appeal.

Florida is also grappling with constitutional hurdles in its marijuana legalization efforts, as the Florida Supreme Court struck down a proposed ballot measure because of misleading language.  Even if the measure were to appear on the ballot, Florida has an additional tax supermajority provision that requires two-thirds supermajority approval for voters to amend the constitution to create or increase a tax.  The experiences in South Dakota and Florida illustrate how tax supermajority provisions have the unintended consequence of impeding recreational marijuana efforts.

May 10, 2021 in Business laws and regulatory issues, Political perspective on reforms, Recreational Marijuana Commentary and Debate, Taxation information and issues , Who decides | Permalink | Comments (1)

Tuesday, May 4, 2021

"Equity in Cannabis Agriculture"

The title of this post is the title of this notable new article now available via SSRN and authored by Ryan Stoa. Here is its abstract:

Cannabis legalization is celebrated by many as a long-overdue rectification of a drug policy that has oppressed and incarcerated vulnerable people and communities for decades.  But as the legalization era continues and the legal cannabis industry starts to take shape, legalization advocates and industry stakeholders must reckon with a sobering reality: the benefits of legalization are not being equitably shared, and vulnerable communities that were hit the hardest during the war on drugs are not well represented in legal cannabis markets.

This reality is as true for stakeholders of cannabis agriculture as it is for other sectors of the cannabis industry.  As the first step in the supply chain, the cultivation of cannabis sets the tone for the industry as a whole.  A well-regulated, equitable, and sustainable cannabis agriculture industry has significant catalytic potential for downstream market participants.  Unfortunately, however, the cannabis agriculture industry suffers from many equity shortfalls.

This Essay will explore three of these shortfalls: (1) access to agricultural lands and start-up capital, (2) cultivation licenses and state distribution of benefits, and (3) labor standards and farmworker protections.  While there are many more equity issues facing cannabis agriculture, this Essay shines a light on these three while identifying areas of concern for future research.  It is clear that stakeholders of cannabis agriculture, including regulators and business owners, can and should prioritize equity and participation in the development of their industry.

May 4, 2021 in Business laws and regulatory issues, Race, Gender and Class Issues, Recreational Marijuana Commentary and Debate | Permalink | Comments (0)

Tuesday, April 20, 2021

"Hitting the Trip-Wire: When Does a Company Become a 'Marijuana Business'?"

The title of this post is the title of this new article authored by Lauren Newell recently posted to SSRN.  Here is its a abstract:

Like the alcohol industry during Prohibition, the marijuana industry is a profitable one.  And, like bootlegging was then, selling marijuana in the United States now is illegal.  Despite the number of states that have legalized or decriminalized the sale of marijuana for medical or recreational use under state law, marijuana sales remain illegal as a matter of federal law under the federal Controlled Substances Act of 1970 (CSA).  Individuals and entities that violate the CSA face substantial potential criminal and civil liability, including prison time and fines, alongside a host of additional negative consequences arising in business law, tax, bankruptcy, banking, and other sources.  The negative consequences marijuana businesses face have been discussed in detail elsewhere.  This Article asks a different question: not, what are the negative consequences, but rather, when do those negative consequence attach?  In other words, when does a company become a “Marijuana Business”?

For purposes of this discussion, a Marijuana Business is an entity that participates, contributes, or assists, directly or indirectly, in the retail and/or medical marijuana industry to an extent that exposes it, its owners, and its agents to potential criminal and civil liability and other negative business consequences.  In short, these are the companies that should be worried about the fact that they are engaging in an industry that is illegal under federal law.  To identify the circumstances that result in a company’s being a Marijuana Business, this Article analyzes seven hypothetical companies that directly participate in the marijuana industry or support others that do.  For each, it asks whether the facts are sufficient to establish criminal liability either directly under the CSA or indirectly under criminal conspiracy or aiding and abetting liability theories.  Part I briefly introduces criminal liability under the CSA, along with the two complicity theories.  Part II analyzes the hypothetical companies’ actions and determines whether they are Marijuana Businesses.  Part III concludes with factors that courts and companies can look toward to determine whether those companies are indeed Marijuana Businesses.

April 20, 2021 in Business laws and regulatory issues, Federal Marijuana Laws, Policies and Practices, Medical Marijuana Commentary and Debate, Recreational Marijuana Commentary and Debate, Who decides | Permalink | Comments (0)

Monday, April 19, 2021

After strong bipartisan approval in US House again, will US Senate finally take up SAFE Banking Act?

1555342460244A big week for discussion of marijuana reform got off to a big start thanks to a vote in the US House of Representatives.  This effective Marijuana Moment piece, headlined "U.S. House Approves Marijuana Banking Bill For Fourth Time, Setting Up Senate Consideration," provides these details:

The U.S. House of Representatives on Monday approved a bill to protect banks that service state-legal marijuana businesses from being penalized by federal regulators.  After receiving an initial voice vote earlier in the afternoon, members passed the legislation by a final recorded vote of 321-101.

The legislation, which was reintroduced by Rep. Ed Perlmutter (D-CO) and a long bipartisan list of cosponsors last month, was taken up under a process known as suspension of the rules, which does not allow for amendments and requires a 2/3rd supermajority to pass....

Because marijuana businesses are largely precluded from accessing traditional financial institutions and have to operate on a mostly cash-only basis, that makes them targets of crime — a point that advocates, regulators and banking representatives have emphasized.  “Even if you are opposed to the legalization of cannabis, you should support this bill,” Perlmutter added.  “American voters have spoken and continue to speak — and the fact is, you can’t put the genie back in the bottle.  Prohibition is over.”...

Rep. Patrick McHenry (R-NC) spoke in opposition to the legislation, stating that “regardless of your position on this bill, I do think the fact remains that cannabis is a prohibited substance under Schedule I of the Controlled Substances Act — and let me further state, by enacting this legislation, we’re effectively kneecapping law enforcement enforcement and legalizing money laundering.”

But in a sign of the bipartisan nature of this reform, Rep. David Joyce (R-OH) took to the floor to defend the legislation. He said “I’m proud to help lead this common sense and overdue effort.”

“At a time when small businesses are just beginning to recover from the economic destruction caused by COVID-19, the federal government should be supporting them, not standing in their way,” he said.

McHenry was the only lawmaker to rise against the bill on the floor, yielding all additional opposition time to other Republican members who actually spoke in support of it.

Just before the debate started on Monday, the governors of 20 states and one U.S. territory — as well as bankers associations representing every state in the country and a coalition of state treasurers — sent letters to House leadership, expressing support for the reform legislation.

The vote marks the fourth time the House has approved the Secure and Fair Enforcement (SAFE) Banking Act. Lawmakers passed it as a standalone bill in 2019 and then twice more as part of coronavirus relief legislation.  At no point did the measure move forward in the Senate under Republican control last session, however.

But this time around, advocates and industry stakeholders are feeling confident that the bill’s path will not end in the House.  With Democrats now in control of both chambers and the White House, there are high expectations that the proposal will make its way through the Senate and onto the president’s desk.

I am hopeful, but not at all optimistic, that this bill will move forward in the Senate with Democrats now in control of the chamber.  Senate leader Chuch Schumer is expected to release a comprehensive marijuana reform bill "soon" and that bill will likely be a priority for Senators and advocates most eager to see federal marijuana reforms.  Senators and others backing broader reforms could potentially view the SAFE Banking Act as an insufficient reform that could undercut momentum for bigger reforms.

April 19, 2021 in Business laws and regulatory issues, Federal Marijuana Laws, Policies and Practices, Medical Marijuana Commentary and Debate, Recreational Marijuana Commentary and Debate, Who decides | Permalink | Comments (0)

Monday, April 12, 2021

"Nowhere to Now, Where? Reconciling Public Cannabis Use in a Public Health Legal Framework"

The title of this post is the title of this notable new paper authored by Daniel Orenstein now available via SSRN. Here is its abstract:

States continue to legalize recreational cannabis, but most have heavily restricted where consumption of newly licit cannabis is permitted.  Every legalizing state has thus far prohibited open, outdoor public use, either limiting lawful use to private property or allowing a small number of licensed indoor venues for consumption outside of public view, an approach borrowed from alcohol control.  In contrast, some non-U.S. jurisdictions have adopted a tobacco control approach, allowing limited outdoor public use while prohibiting indoor public use.  Each approach presents individual and population health risks that reflect the complex intersection of health, social inequities, and community norms.

Cannabis consumers face uncertain but potentially significant health risks from use, and the relative availability of use locations also implicates existing inequities in policing practices and housing.  Those who do not use cannabis but are exposed to others’ use face possible harms from secondhand smoke and from intoxicated behavior, with such risks likely to be inequitably distributed due to existing employment and housing patterns.  Communities as a whole also face risks, including that changing cannabis norms may increase use prevalence or intensity and that concentration of cannabis outlets in under-resourced communities may prove as detrimental as the concentration of other disfavored businesses has been.

Each public use approach carries attendant risks, but a regulatory framework based on the tobacco control model best balances the protection of public health and the promotion of equity and social justice.  This model recognizes the parallels between cannabis and tobacco (in addition to those between cannabis and alcohol).  This approach also provides a pathway to mitigating the public health risks of cannabis legalization by leveraging an approach that has proven effective at reducing secondhand exposures and denormalizing smoking behavior in the tobacco context.

April 12, 2021 in Business laws and regulatory issues, Medical community perspectives, Recreational Marijuana Commentary and Debate, Recreational Marijuana Data and Research, Recreational Marijuana State Laws and Reforms | Permalink | Comments (0)

Sunday, April 11, 2021

"New Market Entrants and Uncertain Drug Policy in the United States"

The title of this post is the title of this new paper recently posted to SSRN and authored by Nathaniel Wilson, a student at The Ohio State University Moritz College of Law.  (This paper is yet another in the on-going series of student papers supported by the Drug Enforcement and Policy Center.)   Here is this latest paper's abstract:  

This article covers two substances that are becoming particularly prevalent in consumer markets across the country, Delta-8 THC and kratom.  It introduces each substance and provides an analysis of the legal landscape that each substance currently faces in the United States, including an overview of relevant statutory law and regulatory efforts at both the federal and state level.  Finally, the article provides policy concerns that legislatures and regulatory agencies should take into consideration when approaching the regulation of these substances, as well as, other novel substances that share similar qualities.

April 11, 2021 in Business laws and regulatory issues, Recreational Marijuana Commentary and Debate, Who decides | Permalink | Comments (0)

Wednesday, April 7, 2021

"American Edibles: How Cannabis Regulatory Policy Rehashes Prohibitionist Fears and What to do About It"

The title of this post is the title of this notable new paper now available via SSRN authored by Jay Wexler and Connor Burns.  Here is its abstract:

Why can’t we buy a cannabis muffin with our morning coffee?  For much of the past century, the answer was simple: cannabis was illegal.  Now, however, with more and more states legalizing cannabis for adult use, the answer is far less clear.  Even in those states that have legalized cannabis, the simple action of buying and eating edibles at the same location has somehow remained a pipe dream despite consumer demand.  Digging a little deeper, we can see how contemporary alarmism, by rehashing the same prohibitionist rhetoric demonizing cannabis for over eighty years, has once again arisen with a new target: cannabis-infused edibles.  From journalists to policymakers to legal scholars, the rekindling of prohibitionist arguments against edibles has had real world impacts on the regulation of cannabis edibles, to the harm of all involved.

This Article explores contemporary cannabis edibles regulation using historical, scientific, and legal frameworks to explain why current edibles regulation is so problematic, and what to do about it.  By delving into the history of cannabis prohibition, this Article shows how the very same arguments propping up prohibitionist edibles policies are rooted in bad-faith arguments made decades ago that themselves were merely thin veils for racism.  Applying this historical perspective and a rational understanding of contemporary cannabis edibles, this Article explores how states have used prohibition-inspired regulations to address two main concerns — overconsumption and inadvertent consumption — and how such regulations need to be revisited and revised.  This Article then argues that social consumption sits at the crux of edibles regulation, and that states must implement social consumption imminently to address the harms that current regulations do not address, or even worse, perpetuate.

April 7, 2021 in Business laws and regulatory issues, History of Marijuana Laws in the United States, Recreational Marijuana Commentary and Debate, Recreational Marijuana State Laws and Reforms | Permalink | Comments (0)

Saturday, April 3, 2021

Senate majority leader shrewdly emphasizing "freedom" in his push for federal marijuana reform

11119_Weed_Legalize_Freedom_Decal_Sticker_DM__26064.1538472841.1280.1280The federal marijauan reform bill that passed through the US House late last year was the "Marijuana Opportunity Reinvestment and Expungement Act" (the MORE Act).  But the marijuana reform bill that Senator Chuck Schumer first introducted in the US Senate in 2018 was called the "Marijuana Freedom and Opportunity Act."  I find the names of these bills particularly notable upon seeing this new Politico interview with now-majority-leader Schumer headlined "Schumer: Senate will act on marijuana legalization with or without Biden."  As highlighted by these excerpts, Senator Schumer seem especially eager to play up the freedom theme in explaining his reasons for supporting reform (my ephasis added):

Schumer: In 2018, I was the first member of the Democratic leadership to come out in support of ending the federal prohibition.  I'm sure you ask, “Well what changed?” Well, my thinking evolved.  When a few of the early states — Oregon and Colorado — wanted to legalize, all the opponents talked about the parade of horribles: Crime would go up.  Drug use would go up.   Everything bad would happen.

The legalization of states worked out remarkably well.  They were a great success.  The parade of horribles never came about, and people got more freedom. And people in those states seem very happy.

I think the American people started speaking with a clear message — more than two to one — that they want the law changed.  When a state like South Dakota votes by referendum to legalize, you know something is out there.

Was there a specific moment or a specific experience that you can point to and say, “This is when I started to see this issue differently?”

A while back — I can't remember the exact year — I was in Denver.  I just started talking to people, not just elected officials, but just average folks.

[They said] it benefited the state, and [didn’t] hurt the state.  There were tax revenues, but people had freedom to do what they wanted to do, as long as they weren't hurting other people.  That's part of what America is about.  And they were exultant in it.

Perhaps because it plays well to my libertarian instincts, I find this focus on "freedom" to be appealing and shrewd as a central part of a pitch for federal marijuana reforms.  I find the freedom focus appealing because I like the general notion that the federal government generally ought not be prohibiting personal freedoms, and especially ought not be using the weighty tools of the federal criminal justice system to advance prohibitions, unless and until we can be generally confident that federal prohibition is doing more good than harm.

Perhaps more importantly, I find the freedom focus shrewd because it lines up with a lot of the smaller-government rhetoric, past and present, often coming from GOP policians and activists.  Whether it is the congressional Freedom Caucus or opposition to gun control or COVID rules or a host of other issues, there are lots of Republican who loudly claim to be ever eager to shrink the size and power of the federal government in order to increase the freedom of individuals (and/or states and localities). Against this political backdrop, I think Senator Schumer is already trying to position any vote against federal marijuana reform as a vote against freedom.

April 3, 2021 in Business laws and regulatory issues, Campaigns, elections and public officials concerning reforms, Federal Marijuana Laws, Policies and Practices, Who decides | Permalink | Comments (0)

Thursday, April 1, 2021

New Mexico on the verge of marijuana legalization only hours after New York legalized

New-mexico-300x199Though we sometimes have to wait until 4/20 for a lot of marijuana discussions, this week is proving historic as the New Mexico legislature last night passed two big marijuana reform bills just hours after New York's Governor officially signed that state's historic marijuana legalization bill (NY basics here).  This AP piece, headlined "New Mexico primed to join US recreational pot wave," reports on the basic details of the new laws just passed in the Land of Enchantment (yes, that is the official NM nickname):

New Mexico is joining a wave of states that are legalizing recreational marijuana as its Democrat-dominated Legislature sent a package of cannabis bills Wednesday to a supportive governor. Lawmakers used a marathon two-day legislative session to push through marijuana legalization for adults over 21 and a companion bill that automatically erases many past marijuana convictions, overriding skeptical Republicans.

By signing the bills, Gov. Michelle Lujan Grisham would extend legal recreational pot sales in the American Southwest by April 2022, when the New Mexico legislation kicks in, and join 16 states that have legalized marijuana, mostly through direct ballot initiatives. California and Colorado were among the first in the U.S. to legalize marijuana, with Arizona becoming one of the latest in the region to follow suit earlier this year. New York Gov. Andrew Cuomo signed a legalization bill Wednesday, and a proposal in Virginia is awaiting the governor’s signature.

The New Mexico initiative would reconsider criminal drug sentences for about 100 prisoners, and give the governor a strong hand in licensing the industry and monitoring supplies.

New Mexico flirted with cannabis legalization in the 1990s, when then-Gov. Gary Johnson challenged taboos against decriminalization in defiance of Republican allies. The state’s medical marijuana program founded in 2007 has attracted more than 100,000 patients. The Legislature was reticent to legalize until now. Several hardline opponents of legalization in the state Senate were voted out of office by Democrats in 2020 primary elections, in a shift that paved the way for Wednesday’s historic vote.

Under the advancing legalization package, New Mexico would levy an initial excise tax on recreational marijuana sales of 12% that eventually rises to 18%. That’s on top of current gross receipts on sales that range from roughly 5% to 9%. Possession of up to 2 ounces (57 grams) of marijuana would cease to be a crime, and people would be allowed six plants at home — or up to 12 per household. The reforms would eliminate taxes on the sales of medical marijuana and seek to ensure adequate medicinal supplies.

“The United States of America is in the midst of a sea change when it comes to this,” said Democratic state Rep. Javier Martinez of Albuquerque, lead sponsor of the legalization bill. “This bill begins to repair the harms of prohibition.”

State oversight would largely fall to the governor-appointed superintendent of the Regulation and Licensing Department that would issue licenses for a fee to marijuana-related businesses. The agency initially would have the authority to limit marijuana production levels by major producers — a lever over market supplies and pricing.... The legalization bill creates a cannabis control division to oversee 10 types of industry licenses. Those include micro-licenses with low annual fees for small producers to grow up to 200 marijuana plants and also package and sell their products.

Bill sponsor Martinez says that provides an important measure of equity, within a bill designed to support communities that suffered from criminalization of marijuana and tough policing. Past drug convictions don’t automatically disqualify applicants for marijuana business licenses. The odor of marijuana or suspicion of possession are no longer legal grounds to stop, detain or search people.

Legalization bill co-sponsor Rep. Deborah Armstrong says New Mexico will respond to early pitfalls of legalization in other states as it mandates child-proof packaging for marijuana products. Public health advocates condemned provisions that allow public consumption lounges for recreational cannabis, citing the dangers of second-hand smoke and vapor to workers and patrons.

Lawmakers discarded a Republican-sponsored bill from Sen. Cliff Pirtle of Roswell that emphasized low taxes in an effort to stamp out illicit weed and would have provided low-cost licenses to small pot farmers by linking fees to the number of plants in cultivation. Local governments cannot prohibit pot businesses but can regulate locations and hours of operation, under the proposal. Bill sponsors say that sheriffs and police want consistency from town-to-town on rules and enforcement.

Republican state Sen. Gay Kernan of Hobbs voted against legalization and said she was amazed that legislative colleagues would support the freedom to buy mind-altering drugs amid New Mexico’s struggles with poverty and opioid overdoses. “I just think it’s terribly unfair to impose this kind of significant change in our way of life and areas of the state that clearly do not welcome this,” Kernan said.

April 1, 2021 in Business laws and regulatory issues, Recreational Marijuana Commentary and Debate, Recreational Marijuana State Laws and Reforms, Who decides | Permalink | Comments (0)

Thursday, March 18, 2021

"Economic Recovery Through Interstate Cannabis Commerce"

The title of this post is the title of  this new paper recently posted to SSRN and authored by Nicholas Sgroi, a 2L at The Ohio State University Moritz College of Law.  (This paper is yet another in the on-going series of student papers supported by the Drug Enforcement and Policy Center.)   Here is this latest paper's abstract:

America is currently experiencing an economic recession plagued with high unemployment and low economic output.  The Alliance for Sensible Markets and other proponents of cannabis legalization think that the cannabis industry can be extremely helpful in recovery through an interstate cannabis commerce plan.  This plan could potentially pump in immediate waves of investment and create thousands of jobs.  The plan lays out two steps: (1) have at least two states enter into an interstate compact for cannabis and (2) obtain congressional approval for the interstate compact.  This article will look at the trends of a few states; speak about the benefits of the plan; touch on the consequences; and talk about the chances of this plan working, especially with the 2020 election approaching. Additionally, the article will tackle questions that face the plan if those two steps are met, such as questions on banking laws, tax laws, and whether psychoactive cannabis will be regulated as a commodity crop or if states will maintain their own existing regulatory framework.

March 18, 2021 in Business laws and regulatory issues, Recreational Marijuana Commentary and Debate | Permalink | Comments (0)

Saturday, March 13, 2021

"Legal Strategy During Legal Uncertainty: The Case of Cannabis Regulation"

The title of this post is the title of this paper recently posted to SSRN authored by W. Michael Schuster and Robert C. Bird. Here is its abstract:

Overcoming its checkered past and stringent regulation, cannabis is quickly becoming a highly lucrative consumer product.  Accompanying this rapid decriminalization is crippling legal uncertainty, as vague statutory language, sporadic backsliding, presidential indecision, and inconsistent enforcement have introduced substantial and unnecessary legal and compliance risks.  This combination of a novel industry and its ambiguous legal environment is not only ripe for reform, but also illuminates how firms can respond strategically to high levels of legal uncertainty.

After a review of the controversial history of cannabis and the legal uncertainty that pervades the industry, the manuscript shows how uncertainty drives firms to pursue risky legal strategies.  This manuscript shows that firms under the stress of uncertainty respond by either aggressively leveraging their legal knowledge to capture value or attempting to circumvent the legal environment altogether.  Both pathways of legal strategy impose unnecessary volatility on cannabis firms.

The manuscript then highlights how legal uncertainty drives legal strategy in a discrete legal environment – the federal government’s refusal to register marks for goods that are illegal under federal law—including most cannabis goods.  We uncover five distinct legal strategies used by cannabis firms, with each strategy responding to a different combination of legal uncertainties.  Finally, eschewing an unrealistic proposal for immediate uniformity, we propose pragmatic and achievable reforms that would significantly reduce legal uncertainty for firms while not upsetting further the already chaotic legal environment of cannabis regulation.

March 13, 2021 in Business laws and regulatory issues, Recreational Marijuana Commentary and Debate, Who decides | Permalink | Comments (0)

Monday, March 8, 2021

"The Problem of Driving Under the Influence of Drugs: The Views of Four Former 'Drug Czars'"

The title of this post is the title of a recent Heritage event that can now be heard in podcast form here.   Here is how the event is described:

People driving under the influence of drugs has been a major problem in America for decades, with alcohol being the most common drug used.  The recent opioid-abuse epidemic, along with the decision by a large number of states to legalize cannabis for medical or recreational use, has made the problem of driving under the influence of drugs even more urgent.  To save lives, the issue must be understood and addressed.

Join us for a discussion with four former White House “Drug Czars” on the importance of this problem, potential new challenges as more states legalize cannabis and more individuals engage in polydrug use, and how the federal government and states should respond.

March 8, 2021 in Business laws and regulatory issues, Criminal justice developments and reforms, History of Marijuana Laws in the United States | Permalink | Comments (2)

Thursday, February 25, 2021

"Blowing Smoke at the Second Amendment"

The title of this post is the title of this new paper recently posted to SSRN and authored by Helen K. Sudhoff, a 3L at The Ohio State University Moritz College of Law.  (This paper is yet another in the on-going series of student papers supported by the Drug Enforcement and Policy Center.)   Here is this paper's abstract:

The Second Amendment to the United States Constitution codified the preexisting right to keep and bear arms, meaning the right was enshrined within the scope it was understood to have at its inception.  When enacted, the Second Amendment broadly protected the right to keep and bear arms for self-defense, only restricting gun ownership for certain classes of people, such as the mentally ill or felons.  However, these historical restrictions never encompassed marijuana users or possessors.  Quite the opposite, many of the founding fathers grew or manufactured cannabis themselves.  Despite this discrepancy, the Federal Government enacted § 922(g) in the Gun Control Act prohibiting gun owners and applicants who are medical marijuana patients from owning or possessing a firearm.  Further, such individuals must voluntarily disclose their medical marijuana use to the government, restricting their right to keep and bear arms and implicating the Fifth Amendment’s Privilege Against Self-Incrimination.  This paper will explore the consequences of the enactment and continued enforcement of § 922 against an individual’s right to keep and bear arms while possessing or using medical marijuana in accordance with their state’s medical programs.

February 25, 2021 in Business laws and regulatory issues, Federal Marijuana Laws, Policies and Practices, Medical Marijuana Commentary and Debate, Who decides | Permalink | Comments (1)

Thursday, February 18, 2021

New Leafly report asserts "legal cannabis now supports 321,000 full-time American jobs"

This short new "Jobs Report 2021" from Leafly provides a rosy account of the job creation contributions of the legalization of marijuana in US states.  Here is part of the start of the 16-page report:

How many jobs are there in America’s legal marijuana industry?  The 2021 Leafly Jobs Report found 321,000 full-time equivalent (FTE) jobs supported by legal cannabis as of January 2021.

To put that in perspective: In the United States there are more legal cannabis workers than electrical engineers.  There are more legal cannabis workers than EMTs and paramedics. There are more than twice as many legal cannabis workers as dentists.  And those jobs aren’t limited to Colorado and California. Medical marijuana is now legal in 37 states, while 15 states and Washington, DC, have legalized cannabis for all adults.  In Florida, there are now more cannabis workers than plumbers. In Pennsylvania, the state’s famous steel industry employs roughly 36,000 workers — and the state’s not-so-famous legal cannabis industry employs nearly 16,000. In Michigan, there are more cannabis workers than cops.

The annual Leafly Jobs Report, produced in partnership with Whitney Economics, is the nation’s cornerstone cannabis employment study. Federal prohibition prevents the US Department of Labor from counting state-legal marijuana jobs.  Since 2017, Leafly’s news and data teams have filled that gap with a yearly analysis of employment in the legal cannabis sector.  Whitney Economics, a leading consulting firm that specializes in cannabis economics, has partnered with Leafly on the project since 2019.

In real numbers, the cannabis job growth in 2020 represents a doubling of the previous year’s US job growth.  In 2019, the cannabis industry added 33,700 new US jobs for a total of 243,700.  Despite a year marked by a global pandemic, spiking unemployment, and economic recession, the legal cannabis industry added 77,300 full-time jobs in the United States.  That represents 32% year-over-year job growth, an astonishing figure in the worst year for US economic growth since World War II.  Outside the cannabis industry, the US economy shrank by 3.5%, the unemployment rate almost doubled, and nearly 10 million Americans saw their jobs disappear.

February 18, 2021 in Business laws and regulatory issues, Employment and labor law issues, Medical Marijuana Data and Research, Recreational Marijuana Data and Research | Permalink | Comments (1)

Sunday, December 27, 2020

"How state marijuana legalization became a boon for corruption"

The title of this post is the headline of this great new lengthy Politico article, which is summarized by its subheadline: "By making local officials the gatekeepers for million-dollar businesses, states created a breeding ground for bribery and favoritism."  I recommend the piece in full, and here is a small taste:

In the past decade, 15 states have legalized a regulated marijuana market for adults over 21, and another 17 have legalized medical marijuana.  But in their rush to limit the numbers of licensed vendors and give local municipalities control of where to locate dispensaries, they created something else: A market for local corruption.

Almost all the states that legalized pot either require the approval of local officials – as in Massachusetts – or impose a statewide limit on the number of licenses, chosen by a politically appointed oversight board, or both. These practices effectively put million-dollar decisions in the hands of relatively small-time political figures – the mayors and councilors of small towns and cities, along with the friends and supporters of politicians who appoint them to boards.  And these strictures have given rise to the exact type of corruption that got [Fall River Mayor Jasiel] Correia in trouble with federal prosecutors.  They have also created a culture in which would-be cannabis entrepreneurs feel obliged to make large campaign contributions or hire politically connected lobbyists.

For some entrepreneurs, the payments can seem worth the ticket to cannabis riches.  For some politicians, the lure of a bribe or favor can be irresistible.

Correia’s indictment alleges that he extorted hundreds of thousands of dollars from marijuana companies in exchange for granting them the local approval letters that are necessary prerequisites for obtaining Massachusetts licenses.  Correia and his co-conspirators — staffers and friends — accepted a variety of bribes including cash, more than a dozen pounds of marijuana and a “Batman” Rolex watch worth up to $12,000, the indictment charges.

December 27, 2020 in Business laws and regulatory issues, Campaigns, elections and public officials concerning reforms, Medical Marijuana State Laws and Reforms, Recreational Marijuana State Laws and Reforms, Who decides | Permalink | Comments (0)