The state treasurers' association wants banking access for legal weed, New Jersey sees a sudden decriminalization and expungement bill, a Texas CBD medical marijuana bill gets expanded, and more.

Welcome to New Jersey, where legalization is stalled but other marijuana reform is happening. (Creative Commons)

State Treasurers Call on Congress to Pass Marijuana Banking Legislation. The National Association of State Treasurers adopted a resolution last Friday calling on Congress to pass legislation to allow the legal marijuana industry access to financial services. The association "supports common sense federal laws and regulations to provide essential banking services to state legalized cannabis businesses, promote public safety and financial transparency, and facilitate local, state and federal tax and fee collection." The group cited public safety and regulatory concerns. The resolution comes after 17 state treasurers sent a similar letter earlier this month.

New Jersey Marijuana Decriminalization and Expungement Bill Suddenly Emerges. As the push to legalize weed falters in Trenton, lawmakers have come up with a new bill that would decriminalize the possession of up to two ounces and reduce penalties for other marijuana offenses. It would also allow people with existing marijuana convictions to apply for expungement of their records and dismiss pending criminal cases against anyone caught with less than two ounces. This new bill cleared the Senate Health Committee Monday and a vote in the Assembly Appropriations Committee Monday afternoon.

Medical Marijuana

New Jersey Medical Marijuana Expansion Bill Advances. As the legalization push falters in Trenton, a bill that would greatly expand the state's medical marijuana system is now moving. The Jake Honig Compassionate Use Medical Marijuana Act, S 10, was advanced by committees in both the Senate and the Assembly on Monday and could head for floor votes as early as Thursday. The bill increases the amount of medicine patients can buy each month from two to three ounces and legalizes edible forms of medical marijuana.

Texas Senate Committee Expands CBD Medical Marijuana Bill to Include More Patients. The Senate Committee on Health and Human Services last Friday voted to advance HB 3703, which would expand the state's CBD-only Compassionate Use Act. The bill originally expanded the list of qualifying conditions to include multiple sclerosis, epilepsy and spasticity, but the committee amended the bill to add even more conditions: ALS, terminal cancer, and autism. The bill now heads for a Senate floor vote.

Harm Reduction

Illinois Needle Exchange Bill Filed. State Sen. Melinda Bush (D-Chicago) last Friday filed SB 1828, which would legalize needle exchange programs statewide under regulation by the Department of Public Health. The bill also provides criminal immunity for needle exchange workers. Some counties in the state currently have needle exchange programs, but workers fear being subject to arrest under ambiguous current state laws.

A Vermont bill to legalize recreational cannabis sales takes another step forward, a New Hampshire bill to let patients grow their own goes to the governor's desk, Virginia's governor vetoes an overdose homicide bill, and more.

Twenty states have passed overdose homicide laws. Virginia won't be next, but North Carolina might. (Creative Commons)

Lawmakers Demand End to Policy Punishing Immigrants Working in Marijuana Industry. Four Colorado US representatives have sent a letter to the Justice Department and the Department of Homeland Security asking them to end a policy that bars immigrants who work in the state-legal marijuana industry from gaining US citizenship. The US Customs and Immigration Service has ruled that working in the industry means immigrants lack the "good moral character" required for citizenship.

Vermont Recreational Sales Bill Wins First House Committee Vote. The House Committee on Government Operations voted 10-1 Thursday to approve a bill that would legalize marijuana sales in the state, SB 54. The bill would tax marijuana sales at 16% and give localities the option of adding another 2%. The bill now goes to the House Ways and Means and Appropriations committees before getting a House floor vote. The bill has already passed the Senate.

Medical Marijuana

New Hampshire Senate Approves Medical Marijuana Home Cultivation. The Senate on Thursday approved HB 364, which would allow patients to grow up to three mature plants, three immature plants, and 12 seedlings at home. The House has already passed the bill but will have to vote again to approve amendments made in the Senate. If it does so, the bill will then head to the desk of Gov. Chris Sununu (R).

Heroin and Prescription Opioids

DEA, Drug Distributors Team Up to Block Release of Opioid Delivery Information. The DEA and the nation's largest drug distributors worked together Thursday to block the public release of information that would show the number of opioid pain pills the companies delivered to pharmacies across the country. Lawyers for the Washington Post and two West Virginia newspapers had sued for release of the information, arguing that distributors and DEA only sought to withhold the information because it would be embarrassing for companies that shipped massive amounts of opioids to states and towns that were arguably unjustifiable, and the DEA doesn't want to explain its actions. In oral arguments in the US 6th District Court of Appeals in Cincinnati, judges hearing the case expressed skepticism about DEA and distributor claims, but issued no ruling.

Pharmaceutical Company Founder, Executives Found Guilty of Bribing Doctors to Prescribe Opioids. Insys Therapeutics founder John Kapoor and four colleagues were found guilty by a federal jury in Boston Thursday of participating in a scheme to bribe doctors to prescribe its fentanyl spray, Subsys. The bribery scheme involved retaining doctors to act as speakers at sham events that were supposedly meant to educate other doctors about the drug. They're looking at 20 years in federal prison. but maintain their innocence and plan to appeal.

Asset Forfeiture

North Dakota Governor Signs Asset Forfeiture Reform Bill into Law. Gov. Doug Burgum (R) on Thursday signed into law a bill reforming civil asset forfeiture, HB 1286. The bill doesn't end civil forfeiture but raises the evidentiary standard for seizures from "a preponderance of the evidence" to "clear and convincing evidence." It also includes a proportionality test to block seizing property worth more than the criminal penalty for the offense. And it adds reporting requirements for courts, prosecutors and the attorney general.

Drug Policy

Amy Klobuchar Releases $100 Billion Proposal to Fight Drug Addiction. Democratic presidential contender and Minnesota Sen. Amy Klobuchar on Friday released a $100 billion policy proposal for tackling drug addiction. While short on specifics, the proposal focuses on funding prevention programs and treatment centers across the country. She also calls for bringing down the price of naloxone and curbing "doctor shopping." Klobuchar's father was an alcoholic, and that makes the issue personal for her. "The one thing I hear over and over again across the country is people’s stories of battling with mental health and addiction," she said in a statement. "People need help, but they just can't get it. I believe everyone should have the same opportunity my dad had to be pursued by grace and get the treatment and help they need." [Ed: Sometimes what's called "doctor shopping" is really pain patients whose doctors they went to are afraid to provide the prescriptions they need.]

Sentencing

North Carolina Senate Approves Homicide by Overdose Bill. The Senate voted on Thursday to approve SB 375, which would allow people who distribute a drug that results in an overdose death to be charged with murder. That means that drug users who share with friends, partners who use from the same supply of drugs, and people who sell to support a drug habit could face murder charges even when the death is an accident. The bill now heads to the House.

Virginia Governor Vetoes Homicide by Overdose Bill. Gov. Ralph Northam (D) on Thursday vetoed HB 2528, which would have made it easier for state prosecutors to go after drug dealers with a felony homicide charge when users die of an overdose. "The disease of addiction has long devastated our communities," Northam said in his veto message. "While I share the goal of addressing the opioid crisis and ensuring drug dealers are punished for supplying dangerous drugs, this bill goes beyond drug dealers and would punish individuals who are themselves struggling with addiction. The way to help individuals struggling with addiction is to ensure they receive proper treatment."

(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.)

Steve D’Angelo was prescient. As the era of legal recreational marijuana in California began just over a year ago, the East Bay medical marijuana maven expressed concerned that taxes on the newly legal industry were too high.

A year later D’Angelo’s concerns have been borne out. The state had estimated that retail marijuana sales would exceed the $3 billion in 2017 sales, which came solely from medical marijuana outlets, but instead legal sales actually declined to $2.5 billion.

As a result, tax revenues for the state are significantly lower than projected. The FY 2018 state budget estimated $185 million in marijuana sales taxes, but actually gathered only about $84 million. And based on January sales, the FY 2019 budget, which estimated tax revenues at $630 million, now looks to be overly optimistic. The latest projections have tax revenues for the fiscal year at $471 million.

In California, legal pot sales are saddled with a $9.25 per ounce cultivation tax paid by growers, as well as a 15 percent retail excise tax and a 7.25 percent retail sales tax paid by consumers. When you add in local taxes, pot buyers in some counties could be paying as much as 45 percent in aggregate tax on legal weed.

To be clear, high taxes aren’t the only things strangling the state’s legal marijuana market. Industry figures and analysts point to two other factors as well: The state’s onerous and costly regulatory requirements are keeping many growers and retailers from leaving the black market, and the refusal by many localities to allow legal marijuana sales in their jurisdictions has left broad swaths of the state with no alternative but the black market. (In a bid to boost the legal market, the state last month okayed plans for statewide deliveries no matter what localities say.)

Still, cutting the tax rate is something that could begin to make a dent in the black market. Assemblymember Rob Bonta (D-Oakland) introduced a pot tax cut bill last year that was defeated, but now, with a year’s worth of disappointing marijuana market news to provide momentum, he’s back again with another pot tax cut bill this year.

Late last month, with three cosponsors Bonta refiled Assembly Bill 286, which proposes eliminating the $148 per pound cultivation tax and reducing the 15 percent retail excise tax to 11 percent for three years. The bill also has the support of newly elected state Treasurer Fiona Ma.

 “The black market continues to undercut businesses that are complying with state regulations and doing things the right way,” Bonta said as he rolled out the bill. “AB 286 will temporarily reduce the tax burden on these licensed operators to keep customers at licensed businesses and help ensure the regulated market survives and thrives. This very strategy has been shown to actually increase overall tax revenue in other states.”

One of the cosponsors is Assemblymember Tom Lackey (R-Palmdale), who authored an identical bill last year. That bill made it through two committees, only to die in Assembly Appropriations.

“Right now, the illicit market is dominating California’s cannabis industry,” said Assemblymember Tom Lackey (R-Palmdale). “These are bad people who are making our communities unsafe.  We need to give the good guys a chance to succeed otherwise our one chance at creating a regulated industry will be compromised.”

Bonta and his colleagues pointed to the experience of legal marijuana states Oregon and Washington, which have successfully taken steps to reduce tax rates and encourage the growth of the legal market. Washington saw exponential growth in marijuana tax revenue after it simplified its tax structure and reduced its rates. Tax revenues there jumped from $13.4 million in the final month of the initial tax rate in June 2015 to more than $33 million in April 2017.

“By lowering the excise tax and postponing the cultivation tax it will lower the overall price for consumers at the register, which will also reduce the differential between illicit and legal prices. Reducing this gap is critical to making the legal market more competitive against the illicit market and more attractive for consumers,” said Beau Whitney, Senior Economist at New Frontier Data.

Fixing California’s pot taxes clearly won’t resolve all the issues the state faces as it makes the transition to the world’s largest legal marijuana market, but it’s a start. 

This article was produced by Drug Reporter, a project of the Independent Media Institute.

Even as a California safer injection site bill approaches final passage, the Justice Department takes aim at the harm reduction practice; state financial regulators want Congress to act on marijuana banking, and more.

Vancouver's InSite safer injection site. Coming soon to San Francisco? (Creative Commons)

State Financial Regulators Call on Congress to Deal With Marijuana Banking Problems. The top financial regulators in 13 states sent a letter last week to congressional leaders demanding that they take action to protect banks working with marijuana businesses. The conflicts between state-level legalization and federal prohibition have created confusion in the financial sector and jeopardized public safety, the regulators said. "It is incumbent on Congress to resolve the conflict between state cannabis programs and federal statutes that effectively create unnecessary risk for banks seeking to operate in this space without the looming threat of civil actions, forfeiture of assets, reputational risk, and criminal penalties," the regulators wrote. "While Congress has taken some action, such as the Rohrabacher amendment prohibiting federal funds being used to inhibit state medicinal marijuana programs, this has been an impermanent approach that requires a permanent resolution." Regulators from Alaska, Connecticut, Hawaii, Louisiana, Michigan, Montana, Nevada, New York, Oklahoma, Oregon, Pennsylvania, Utah and Washington State signed the letter.

Medical Marijuana

Oklahoma Proposed Medical Marijuana Regulations Now Open for Public Comment. State officials are now asking the public for its input on the regulation and implementation of medical marijuana in the state. "Lawmakers in the legislative working group are seeking a path forward to implement State Question 788 in a way that conforms to the desires of voters who passed the law," said Speaker Charles McCall (R-Atoka). "To do that effectively, the working group needs as much input as possible from citizens -- supporters, advocates, patients, health-care providers, public safety and law enforcement officers and even those who have concerns. I would encourage all Oklahomans who have an interest in this issue to use this opportunity to share input and have their voices heard." Comments can be sent to [email protected]. Messages will then be shared with members of the working group.

Harm Reduction

Justice Department Attacks Safer Injection Sites. In an op-ed in the New York Times titled "Fight Drug Abuse, Don't Subsidize It," Deputy Attorney General Rod Rosenstein attacked safer injection sites as "very dangerous" and argued they would "only make the opioid crisis worse." He also points out that they are federally illegal and warns that violations are punishable by up to 20 years in federal prison. His op-ed comes as cities such as New York, Seattle, and San Francisco advance plans to open such facilities in a bid to reduce harms.

California Safer Injection Site Bill Passes Senate. The Senate voted Monday to approve Assembly Bill 186, which will allow the city of San Francisco to undertake a three-year, pilot safer injection site program. The bill now goes back to the Assembly for a final concurrence vote before heading to the desk of Gov. Jerry Brown (D).