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Another Year Where Marijuana Legalization or Even Banking Reform Couldn't Get Through Congress

[image:1 align:left]A Congress with a narrowly divided Senate and a House barely controlled by Republican radicals is no place to get substantive marijuana reforms done -- at least it wasn't in the first 11 1/2 months of 2023. While there was plenty of sound and fury, as the year's final days tick down, federal marijuana legalization has failed to advance and even the reformers' backstop bill, the Secure and Fair Enforcement Regulation (SAFER) Banking Act appears to again be stuck.

After it was clear that legalization was dead in the Senate despite the best efforts of Majority Leader Chuck Schumer (D-NY) -- 60 votes would be needed in the Senate and pro-legalization Republican votes were not sufficient to get there -- the SAFER Banking Act looked like the last, best hope for significant marijuana reform legislation.

Schumer said in September he intended to "bring it to the floor with all due speed," but in October, Republican cosponsor Sen. Steve Daines (R-MT) said the bill was on hold until he was sure it could pass in the House.

It's still on hold, and last month, Schumer said he still needs more Republican support. He needs "10 or 11 Republican" senators, he said. The bill currently has four Republican cosponsors.

Marijuana Is on the Cusp of Being Rescheduled

Responding to a request from the Biden administration, the Department of Health and Human Services (HHS) announced on August 30 that it was recommending that marijuana be removed from Schedule I of the Controlled Substances Act and instead be placed in Schedule III.

The issue is now before the Drug Enforcement Administration (DEA), which will make the final decision. "As part of this process, HHS conducted a scientific and medical evaluation for consideration by DEA. DEA has the final authority to schedule or reschedule a drug under the Controlled Substances Act. DEA will now initiate its review," a DEA spokesperson said.

Schedule I is for drugs that have a high potential for abuse and no accepted medical use, such as heroin and LSD, while Schedule III is for drugs that have a moderate to low potential for dependence and a lower abuse potential, such as ketamine and testosterone.

Reclassification could have important ramifications for the state-legal marijuana industry, such as allowing stock exchanges to list businesses in the trade and allowing the industry to take advantage of business tax write-offs that are currently blocked by IRS Revenue Code 280E. In the current situation, cannabusinesses pay taxes based on most of their gross revenues, rather than on the profits left after paying employees, rent and most other expenses.

Potentially it could also allow stock exchanges to list businesses in the trade, allow foreign companies to begin selling their products in the United States, and allow for interstate commerce within the US. Just how far the business or medical environment would progress, however, would depend on whether or when cannabis gets approved by the FDA, and perhaps on other steps.

HHS's recommendation to DEA is not binding, but it is very persuasive. DEA has yet to contradict an HHS recommendation on matters of health and science. But DEA has previously argued that the federal statutory requirements governing controlled substances only meet the requirements of current UN scheduling of cannabis for US Schedules I and II, a requirement in the Controlled Substances Act. With Schedule III, DEA would have to adopt additional rules to plug those regulatory gaps, and courts would have to allow that if it's challenged. It's not known when DEA will issue its decision.

Oregon's Pioneering Drug Decriminalization is Under Attack

In November 2020, voters in Oregon made history by becoming the first in the country to break with a century of drug war by approving the decriminalization of drug possession. Measure 110 not only put an end to thousands of low-level drug arrests, it also provided hundreds of millions of dollars for drug treatment, prevention, and related services by tapping into marijuana tax revenues -- $300 million so far.

But the treatment and prevention side of things has been slow rolling out, fentanyl has been coming in (fentanyl overdose deaths more than doubled between 2020 and 2023), and public drug use amidst a massive homeless problem has irked many, and not just those wielding a conservative critique that paints state and Portland leaders as wacky liberals blighting the state -- never mind that it was the voters and not political leaders who chose decriminalization.

And now, an effort is underway to roll back the clock. In September, a group of political operatives and deep-pocketed donors calling themselves the Coalition to Fix and Improve Measure 110 filed a pair of proposed ballot initiatives, Fix and Improve Measure 110-Measure A and Fix and Improve Measure 110-Measure B, would once again make drug possession a crime, as well as making changes on the treatment side of the ledger.

The possession of drugs such as cocaine, fentanyl, heroin, and methamphetamine would be a misdemeanor, and there would be a new misdemeanor of public consumption of illicit drugs. Version "B" of the initiative would also increase penalties for some drug offenses, such as where drug use causes death or when the offender is a repeat offender. That version would also make possession of pill-making machines a felony offense.

Those initiatives are not on the ballot yet. They must first come up with 120,000 valid voter signatures by July. But even if the initiatives fail to qualify for the ballot or lose at the ballot box in 2024, state political leaders are already taking aim at Measure 110, with both Gov. Tina Kotek (D) and legislative leaders on board.

In October, the legislature created the Joint Interim Committee on Addiction and Community Safety to review drug policy, especially Measure 110, make addiction services more accessible and ensure law enforcement has the tools it needs to keep communities safe. That committee held hearings and traveled to Portugal to investigate drug decriminalization there.

In December, Gov. Kotek announced a plan among state and Portland officials to criminalize public drug use and give police more resources to fight drug distribution. The Portland city council has already approved an ordinance criminalizing public drug use, but it would only go into effect if it criminalized at the state level.

As 2023 draws to a close, proponents of Measure 110 and drug decriminalization are going to have their work cut out for them. Whether it is from local leaders, the legislature, the governor, or deep-pocketed initiative backers, the cannons are pointed squarely at drug users, thousands of whom have been kept free of the tender mercies of the criminal justice system since Measure 110 went into effect.

Republicans Compete to See Who Can Be Most Warlike When It Comes to Mexican Drug Cartels

Whether it's the hard right version of virtue-signaling, a belated recognition that white people are dying of drug overdoses, or just another opportunity to bash the Biden administration over the border, Republican politicians and presidential candidates were in a heated competition this year to see who could be the most bellicose when it comes to confronting the Mexican drug trafficking organizations that supply our insatiable demand for cocaine, fentanyl, heroin, and meth.

Whether in the halls of Congress or on the campaign trail, attacking the cartels proved much more appealing to those beating the war drums than coming up with policies that would actually ameliorate some of the harms of the illicit drug marketplace -- up to and including turning it into a licit, regulated drug marketplace.

They got off to an early in start. In March, Reps. Dan Crenshaw (R-TX) and Tim Walz (R-FL) filed a resolution, HJ Res. 18 "to authorize the use of United States Armed Forces against those responsible for trafficking fentanyl or a fentanyl-related substance into the United States or carrying out other related activities that cause regional destabilization in the Western Hemisphere."

That same month, House rightists led by Rep. Chip Roy (R-TX) filed a bill designating the cartels as foreign terrorist organizations. Sens. John Kennedy (R-LA) and Lindsey Graham (R-SC) filed companion legislation, the cutely named Ending the Notorious, Aggressive and Remorseless Criminal Organizations and Syndicates (NARCOS) Act of 2023 in April.

Also in March, Rep. Marjorie Taylor Greene (R-SC) added some unintentional levity to the mix when she told her two million Twitter followers that the cartels had planted bombs on US soil at the border to terrorize Americans and kill or injure Border Patrol agents and posted a photo of what she claimed was a "bomb." "This changes everything!" she hyperventilated as she called on the US military to "take action" and "end this Cartel led war against America!" But her bomb was only a bag of sand.

In April came reports that Donald Trump was seeking a plan to wage war on the cartels and had been briefed on options that include US troop deployments on Mexican territory and unilateral military strikes.

Trump's would-be challengers for the GOP presidential nomination were ready to one-up him, though, with Florida Gov. Ron DeSantis especially eager to get to shooting people. In June, he called for executing drug smugglers at the border.

Being tough on the border is a theme DeSantis has returned to repeatedly. In August, he doubled down on his vow of deadly force against the cartels. "Day one, we're declaring it to be a national emergency," DeSantis said. "I'm going to do what no president has been willing to do. We are going to lean in against the cartels directly, and we are going to use deadly force against them." And then he tripled down: "We're authorizing deadly force. They try to break into our country? They will end up stone-cold dead," he said.

Not to be outdone, former South Carolina governor Nikki Haley called for siccing US special forces on the cartels. "When it comes to the cartels, we should treat them like the terrorists that they are," Haley said. "I would send special operations in there and eliminate them just like we eliminated ISIS and make sure that they know there's no place for them. If Mexico won't deal with it, I'll make sure I deal with it," she added.

As for the Republican frontrunner, former president and current defendant in numerous criminal and civil cases Donald Trump has his own plans to deploy the US military against the cartels. As part of a broader strategy to crack down on immigration and the border that includes vetting migrants to ensure that no "Marxists" are let in, Trump plans at least two policies that take direct military aim at Mexican drug cartels. The first policy would deploy Coast Guard and US Navy ships to stop drug smuggling boats and the second would designate drug cartels as "unlawful enemy combatants," which would allow the US military to target them in Mexico. That is the same designation used to detain 9/11 suspects for decades at Guantanamo.

Drug Overdose Deaths Plateau at Level Way Too High

Ever since April 2021, the Centers for Disease Control and Prevention (CDC) has estimated that more than 100,000 people died of drug overdoses in the preceding 12-month period. While there is necessarily in a lag in reporting the numbers, so we do not have data for all of this year, the CDC reported that as of June 2023, the provisional estimate of drug overdose deaths in the preceding 12-months was 111,877. That is down slightly from the 112,436 past-year deaths estimated the previous month, but that figure was an all-time high and the June 2023 figure is still devastatingly high.

The tiny bit of good news is that the number seems to have reached a plateaus, with the number of deaths declining very slightly in the latest data after hovering around 108-110,000 dead for each of the previous two years of previous year deaths. That is in sharp contrast to the sudden and massive rise in overdose deaths beginning as the coronavirus pandemic hit in early 2020. In February 2020, the previous 12-month overdose death number was under 75,000. By February 2021, the figure was 97,000.

There is yet no data on which drugs were killing people this year, but earlier CDC data found that opioids were implicated in 75 percent of overdose deaths and synthetic opioids (i.e., fentanyl and its derivatives) were involved in nearly 90 percent of those deaths. Deaths from stimulants such as cocaine and methamphetamine, with or without the presence of synthetic opioids, were on the increase, with cocaine involved in 23 percent of all overdose deaths. There is no evidence that this trend has altered this year.

Regulated markets allow for the sale of substances that are manufactured according to exacting standards, tested for adulterants, and packaged with relevant information on potency and dosage, all of which could reduce accidental drug overdoses. But we don't have that.

Move Over, Fentanyl, Here Come Xylazine and the Nitazenes

One of the more insidious features of prohibitionist drug markets is the constant pressure to innovate with new, more potent drug formulations. We have seen it in spades in recent years with fentanyl and its analogs, and this year, we saw two new "drug threats" enter the spotlight: xylazine and the nitazenes.

Xylazine is an animal tranquilizer known by the street name "tranq," not an opioid, and thus does not respond to opioid overdose reversal drugs such as naloxone. It also has other serious potential health effects, including wounds that may eventually require amputations, as well as breathing difficulties. It is often found mixed with fentanyl.

Now, xylazine has been detected in nearly every state in the country, and xylazine-involved overdose deaths are skyrocketing, albeit from very low initial levels. The Centers for Disease Control and Prevention (CDC) reported in June that the monthly percentage of fentanyl deaths with xylazine detected jumped from 2.9 percent in January 2019 to 10.9 percent in June 2022. CDC also found that the death rate from xylazine overdoses jumped 35-fold from 2018 to 2021.

In April, the Biden administration designated fentanyl combined with xylazine as an emerging drug threat, citing impact of xylazine on the opioid crisis, including its growing role in overdose deaths in every region of the United States. And in July, the administration rolled out a National Response Plan to confront the xylazine-fentanyl phenomenon. The plan calls for a public health campaign of increased testing and treatment and more data collection to see how the drug combo spreads and contributes to overdose numbers. But it also calls for looking into whether to schedule xylazine and includes the reflex resort to law enforcement to try to suppress supply.

Congress, for its part, has also gotten in on the action. Both chambers have approved the TRANQ Research Act, which directs the National Institute of Standards and Technology (NIST) to take steps to enhance understanding of the dangerous animal tranquilizer xylazine, or tranq, and other novel synthetic drugs; develop new tests for detection; and establish partnerships with front-line entities that are often the first points of contact with new street drugs. Differences between the House and Senate versions of the bill remain to be hammered out in conference committee.

The nitazenes are a group of new synthetic opioids that are emerging in illicit drug markets and may be more powerful than fentanyl, a thousand times more potent that morphine, and may require even greater doses of opioid overdose reversal drugs to reverse overdoses, according to a study published in August in the journal JAMA Network Open.

They were developed by researchers at a Swiss pharmaceutical company in the 1950s as pain relievers but never won approval for wider use. While considered opioids, the nitazenes have a different chemical structure from fentanyl. They began showing up in the US around 2019 -- after China restricted fentanyl-like substances under from the Trump administration. And now they are beginning to show up in overdose death reports.

California's Progressive Governor Vetoes Progressive Drug Reform Measures

Last year, Gov. Gavin Newsom (D) stifled an important harm reduction advance when he vetoed a bill that would have allowed a safe injection site pilot program to get underway. This year, Newsom was at it again: In October, he vetoed Senate Bill 58, which would have decriminalized the use and possession of several natural psychedelics, including psilocybin (found in magic mushrooms), mescaline, and dimethyltryptamine (DMT -- found in ayahuasca).

In his veto message, Newsom said he was open to exploring the therapeutic benefits of natural psychedelics, but that guiderails needed to put in place first -- and he appeared to give short shrift to any uses other than medicalized therapeutic use.

"Both peer-reviewed science and powerful personal anecdotes lead me to support new opportunities to address mental health through psychedelic medicines like those addressed in this bill," Newsom wrote. "Psychedelics have proven to relieve people suffering from certain conditions such as depression, PTSD, traumatic brain injury, and other addictive personality traits. This is an exciting frontier and California will be on the front-end of leading it. California should immediately begin work to set up regulated treatment guidelines -- replete with dosing information, therapeutic guidelines, rules to prevent against exploitation during guided treatments, and medical clearance of no underlying psychoses. Unfortunately, this bill would decriminalize possession prior to these guidelines going into place, and I cannot sign it."

Throwing a sop to the bill's supporters, Newsom urged them to send him a bill next year that includes therapeutic guidelines and added that he was "committed to working with the legislature and sponsors of this bill to craft legislation that would authorize permissible uses and consider a framework for potential broader decriminalization in the future, once the impacts, dosing, best practice, and safety guardrails are thoroughly contemplated and put in place."

That was not the only drug reform veto Newsom wielded this year. That same month, he vetoed a bill that would have allowed localities to give marijuana retailers the ability to prepare and serve non-marijuana food and beverages, Assembly Bill 374.

In his veto message, Newsom said he was concerned the bill could undermine the state's smoke-free workplace protections. He said he "appreciated" that struggling pot shops needed more revenue streams, but that was not enough for him to sign the bill.

As Newsom increases his national political profile, the question becomes: Is he sacrificing important drug reforms on the altar of his national political ambition?

Delaware Becomes 22^nd State to Legalize Cannabis

In April, legalization-opposing Gov. John Carney (D) bowed to political reality and allowed a pair of marijuana legalization bills passed with a veto-proof majority to become law without his signature. House Bill 1, sponsored by Rep. Ed Osienski (D), legalized the possession of a limited amount of marijuana legal for adults 21 and older. A separate measure, House Bill 2, will legalize and regulate cultivation and sales.

While legalization is in effect now, having a working system of legal marijuana commerce in place is still months down the road. The state will issue up to 30 retail marijuana licenses, 30 manufacturing licenses, 60 commercial cultivation licenses, and five testing licenses, but none of them before August 2024. Between now and then, state officials will be adopting regulations for the nascent industry and evaluating applications.

The new law contains social equity provisions with social equity licenses going to people who have lived at least five of the last 10 years in "a disproportionately impacted area" or who have or have family members who have previous marijuana convictions (except for delivery to a minor or possession of very large quantities). In another bid to promote equity in the industry, it also includes provisions for "microbusiness" licenses.

There is no provision for home cultivation.

Minnesota Becomes 23^rd State to Legalize Cannabis

In May, the House and Senate approved the House File 100 marijuana legalization bill and Gov. Tim Walz (DFL) quickly signed it into law. As of August 1, people 21 and over can possess up to two ounces in public. They can also grow up to eight plants at home, four of which can be in flowering, and they can possess up to two pounds of the fruits of their harvest at home. People can also transfer up to two ounces without remuneration to other adults.

Also beginning August 1, certain misdemeanor marijuana records were automatically expunged. A new bureaucratic entity, the Cannabis Expungement Board, will also consider some marijuana felonies for relief, including potential sentence cuts for those still behind bars.

The legal marijuana commerce is expected to take between a year and 18 months to get up and running with licenses issued and sales underway by then. Existing medical marijuana dispensaries will be able to get combination licenses to compete in the adult use market as of March 1, 2025.

Cities and counties cannot ban legal marijuana businesses, but they can impose "reasonable" regulations. They can also chose to operate their own dispensaries, like a state liquor store.

Retail marijuana sales will be taxed at 16.875 percent, which adds a 10 percent pot tax to the state's 6.875 percent sales tax. Four-fifths of marijuana tax and fee revenue will go to the state's general fund, with some funds earmarked for grants to marijuana businesses and drug treatment efforts. The other 20 percent will go to local governments.

The law will also allow onsite consumption for special events, as well as marijuana delivery services.

The new law will attempt to address equity concerns by scoring applicants higher if they live in low-income neighborhoods, have marijuana convictions or family members with them, or are military veterans with less than an honorable discharge because of a marijuana-related offense.

Ohio Becomes 24^th State to Legalize Cannabis

In November, Ohio voters decisively embraced the Issue 2 marijuana legalization initiative, approving it with 56.8 percent of the vote as of early Wednesday morning. Under Issue 2, people 21 and over will be able to lawfully possess up to 2 ½ ounces of marijuana and 15 grams of extracts. The initiative also included a home grow provision allowing for up to six plants, with a limit of 12 per household, but landlords will be allowed to bar home grows in their properties.

As of mid-December, efforts by Republicans in the state legislature to substantially alter the will of the voters had not borne fruit. The GOP-led Senate passed a bill that ended up making only minor changes to the new marijuana law, including reducing the household plant limit to six (the GOP had originally sought to kill home grows) and altering the allocation of tax revenues, but also okayed the immediate purchasing of marijuana from existing medical marijuana dispensaries. House Republicans, meanwhile, have are considering modifications that would keep home grows but add a residency requirement, but have yet to pass it.

Marijuana became legal on December 7, once the elections were certified, but there is, as yet no legal means of purchasing it.

(This article was prepared by StoptheDrugWar.org's 501(c)(4) lobbying nonprofit, the Drug Reform Coordination Network, which also pays the cost of maintaining this website. DRCNet Foundation takes no positions on candidates for public office, in compliance with section 501(c)(3) of the Internal Revenue Code and does not pay for reporting that could be interpreted or misinterpreted as doing so.)