Sen. Bernie Sanders (I-VT) is pledging to use executive action to deschedule marijuana within the first 100 days of his administration if he is elected president.
In a cannabis reform plan released on Thursday at 4:20 PM EST, the 2020 Democratic presidential candidate said removing cannabis from the Controlled Substances Act would be the first step, but that he’d simultaneously press Congress to make legalization a permanent policy through legislation.
The senator said he will nominate an attorney general, Drug Enforcement Administration administrator and Health and Human Services secretary, “who will all work to aggressively end the drug war and legalize marijuana.” Once the attorney general is confirmed, Sanders will issue the executive order to deschedule cannabis.
Sanders, who became the first major presidential candidate to endorse legalization during his last campaign and filed the Senate’s first-ever cannabis descheduling bill in 2015, is expanding on his vision for what a legal cannabis model should look like.
When we said four years ago that we needed to legalize marijuana, it was considered a "radical" idea.
Today, 11 states plus DC have legalized it. Not so radical anymore.
When we're in the White House we will do so nationwide.
— Bernie Sanders (@BernieSanders) October 24, 2019
“It is time to admit the criminalization of marijuana was a disaster, especially for communities of color, and allow those most impacted to move forward with their lives,” the plan states. “Our job now is to legalize marijuana and vacate and expunge past marijuana convictions, and ensure that revenue from legal marijuana is reinvested in communities hit hardest by the War on Drugs.”
There are several unique proposals included in the new plan. To mitigate the influence of large corporate marijuana firms, the senator wants to enact market and franchise caps. Tobacco companies would be prohibited from participating in the legal industry.
“Big Tobacco is already targeting the marijuana industry for its profits,” the plan reads. “As president, Bernie will not allow marijuana to turn into Big Tobacco.”
Additionally, Sanders said the government would provide resources “for people to start cooperatives and collective nonprofits as marijuana businesses that will create jobs and economic growth in local communities.”
Today, the government considers marijuana as dangerous as heroin.
As president I will immediately issue an executive order to declassify marijuana as a controlled substance.
— Bernie Sanders (@BernieSanders) October 24, 2019
People who’ve been incarcerated for cannabis offenses or who are from communities that have been disproportionately impacted by the drug war would be prioritized to benefit from legalization under the senator’s plan. That includes reinvesting cannabis tax revenue into such communities, setting aside $20 billion in grants to provide access to capital to marginalized individuals and stimulating business in areas hit hardest under prohibition.
The plan also calls for the creation of a $10 billion grant program under the U.S. Department of Agriculture (USDA) to help marginalized individuals start rural and urban cannabis farms “to ensure people impacted by the war on drugs have access to the entire marijuana industry.”
“These grants will be used for design, technical assistance, purchasing equipment, installing infrastructure and more,” the plan says.
Sanders also wants to establish a national system to certify organic marijuana “to give consumers the information they need to make an informed decision” and to ensure “marijuana farmers are paid a fair price for their products with tools like supply management and reserves and transition toward a parity system to guarantee marijuana farmers a living wage.”
USDA would also be involved in establishing “safety inspection and quality control processes for growers and producers.”
Too many lives were ruined due to the disastrous criminalization of marijuana. Today I am releasing my plan to:
✅ Legalize marijuana with executive action
✅ Expunge past marijuana convictions
✅ Invest in communities most affected by the War on Drugs https://t.co/0xQSHn6F3U
— Bernie Sanders (@BernieSanders) October 24, 2019
Another provision concerns expungements, and it is modeled after California’s cannabis program. Sanders will order federal and state law authorities to review data on marijuana convictions and then clear the records for those cases. Individuals would be able to reach out to their state governments to ensure their case is being reviewed, and if after two years there’s no action, the plan would provide an “administrative remedy.”
It’s not clear what powers the senator would have to direct state action with respect to the cannabis conviction review proposal, but it’s possible it would involve withholding certain federal funds to penalize states that don’t comply. Sanders also wants to proactively provide funding for states and cities “to partner with organizations that can help develop and operate the expungement determination process, much like how California worked with Code for America.”
The senator said he would also “revitalize” the clemency process by creating an independent White House clemency board that would presumably help streamline the identification of eligible federal marijuana cases.
Legalize marijuana. Expunge past convictions. End the War on Drugs.
— Bernie Sanders (@BernieSanders) October 24, 2019
Further, Sanders said he would eliminate drug testing requirements for individuals applying for or receiving public benefits, and he’d ensure that people don’t lose federal housing assistance over cannabis. Under the plan, immigrants would not be denied entry to the use or face deportation because of marijuana.
“The legalization of marijuana is a once in a lifetime opportunity to get federal policy right from the start,” Madisen Saglibene, executive director of Nevada NORML, said in a press release. “The plan released today by Senator Sanders would end prohibition and address the harms that have been inflicted on generations of Americans under its racially disproportional enforcement.”
“His plan would provide real economic prosperity in the emerging legal marketplaces for those who have had to carry the burden of incarceration or a criminal record due a substance that is now legally generating millions in Nevada each year,” she said.
This latest proposal builds on a criminal justice reform plan Sanders released in August. That plan also called for legalization, expungements and reinvesting in communities most hurt by the drug war. And it included the establishment of safe consumption facilities where individuals could use illicit drugs under medical supervision in order to prevent overdoses and encourage people to seek treatment.
But while Sanders is a longstanding champion of marijuana reform and advocate for harm reduction programs, he’s declined to back broader decriminalization of drug possession, a stance being taken by a growing number of his rivals for the Democratic nomination. During an interview on Joe Rogan’s podcast in August, the senator pushed back against arguments in favor of legalizing and regulating drugs beside marijuana.
Sanders also first floated the idea of exercising executive action to legalize cannabis during the Rogan appearance.
He congratulated Canada last week on the first anniversary since the country implemented a legal cannabis market, stating that “Vermont shares a border with Canada, and as far as I can tell, the sky has not fallen and the cities have not plunged into anarchy on the other side.”
Former Rep. Beto O’Rourke (D-TX) also released a drug policy reform plan on Thursday, proposing to decriminalize possession of all drugs and establish safe injection sites and needle exchange programs in his plan. South Bend, Indiana Mayor Pete Buttigieg and Rep. Tulsi Gabbard (D-HI) are also in favor of the decriminalization policy, and entrepreneur Andrew Yang wants to remove criminal penalties for use and possession of opioids.
Photo courtesy of Phil Roeder.
IRS Official Offers Tax Advice To Marijuana Businesses And Says Feds Expect Industry To Keep Growing
The Internal Revenue Service (IRS) says it expects the marijuana industry to continue to grow, and it’s offering some tips to cannabis businesses on staying compliant with taxes while the plant remains federally prohibited.
In a blog post on Monday, IRS’s De Lon Harris said that the “evolving and complex issue my organization has been focused on is the tax implications for the rapidly growing cannabis/marijuana industry.”
“The specific rules and regulations regarding how [marijuana] is taxed at the federal level provides the IRS an opportunity to promote voluntary compliance, not only through audits, but also through outreach and education,” he said, noting the rapid expansion of state-legal cannabis markets. “And while there are 14 states that still ban cannabis use, we expect both unlicensed and licensed marijuana businesses to grow.”
“It’s tricky from a business perspective, because even though states are legalizing marijuana and treating its sale as a legal business enterprise, it’s still considered a Schedule 1 controlled substance under federal law,” Harris wrote. “That means a cannabis/marijuana business has additional considerations under the law, creating unique challenges for members of the industry.”
The official, who serves as commissioner of IRS’s Small Business/Self Employed (SB/SE) Examination division, recognized that the status quo means that marijuana businesses are forced to operate on a largely cash-only basis, and federal prohibition also means that companies in the sector are precluded to taking key tax deductions.
However, while the tax statute known as 280E means the industry is ineligible for most federal tax deductions and credits, he noted that marijuana firms “can deduct their cost of goods sold, which is basically the cost of their inventory.”
“What isn’t deductible are the normal overhead expenses, such as advertising expenses, wages and salaries, and travel expenses, to name a few,” Harris said. “I understand this nuance can be a challenge for some business owners, and I also realize small businesses don’t always have a lot of resources available to them.
The official previewed a new “Cannabis/Marijuana Initiative” the agency is launching that will provide specific job training to tax officials to effectively carry out audits within the industry, ensure that there’s consistency in the IRS’s policy for cannabis, work with stakeholders to ensure tax compliance and help to identify non-compliant businesses.
“I’m very focused on the success of this strategy because it’s very important for business owners to understand that under our nation’s tax laws, and specifically Internal Revenue Code 61, all income is taxable, even if someone is running a business that’s considered illegal under federal law,” he said. “This is a truly groundbreaking effort for our agency.”
“Our strategy is not limited to pushing information out via our website in the hope that business owners will find it. I’ve made it a priority for my SB/SE organization to engage with the cannabis/marijuana industry through speaking events and other outreach. I have done three of these types of events over the last year, and what I have heard is a genuine desire to comply with the tax laws regarding the industry. Through this extended outreach, we hope to help small business owners and others fully understand the unique tax rules before there are any compliance issues.”
“Since the unique circumstances of the cannabis industry can make tax preparation challenging, I hope that new and experienced business owners take my advice in this post and use our resources to ensure they understand their tax obligations and avoid penalties associated with non-compliance,” the blog post concludes. “We’re always here to help with tools, information and guidance.”
This is yet another signal that while marijuana remains federally illegal, agencies are increasingly recognizing that a policy shift is happening in states and may well be on the horizon at the congressional level.
As leadership in the House and Senate work to advance legislation to deschedule cannabis, lawmakers have also pushed to enact clear, statutory protections for financial institutions that work with state-legal marijuana businesses. And that would be accomplished through House-passed standalone legislation, or an amendment that was attached to a defense spending bill this week.
In the interim, banks and credit unions are operating under 2014 guidance from the Financial Crimes Enforcement Network (FinCEN) that lays out reporting requirements for those that choose to service the marijuana industry. FinCEN released a report last week showing that there were 706 financial institutions that said they were actively serving cannabis clients as of the last quarter.
IRS separately hosted a forum last month dedicated to tax policy for marijuana businesses and cryptocurrency.
The seminar, which was presented by a representative of the National Association of Tax Professionals (NATP), examined issues such as allowable tax deductions while cannabis remains federally illegal and how different states approach taxing marijuana. It also covered issues related to paying taxes on earnings in Bitcoin and other forms of digital currency.
Earlier this year, IRS Commissioner Charles Rettig told Congress that the agency would “prefer” for state-legal marijuana businesses to be able to pay taxes electronically, as the current largely cash-based system under federal cannabis prohibition is onerous and presents risks to workers.
Former Treasury Secretary Steven Mnuchin said in 2019 that he’d like to see Congress approve legislation resolving the cannabis banking issue and he pointed to the fact that IRS has had to build “cash rooms” to deposit taxes from those businesses as an example of the problem.
IRS released updated guidance on tax policy for the marijuana industry last year, including instructions on how cannabis businesses that don’t have access to bank accounts can pay their tax bills using large amounts of cash.
The update appears to be responsive to a Treasury Department internal watchdog report that was released earlier in the year. The department’s inspector general for tax administration had criticized IRS for failing to adequately advise taxpayers in the marijuana industry about compliance with federal tax laws. And it directed the agency to “develop and publicize guidance specific to the marijuana industry.”
Harris’s predecessor at IRS SB/SE also participated in an informational webinar in December, offering candid insights on a variety of cannabis industry issues from the federal perspective.
Massachusetts Lawmakers Discuss Drug Decriminalization And Safe Injection Sites At Hearing
Massachusetts lawmakers on Monday heard testimony on separate proposals to decriminalize drug possession and establish a pilot program for safe injection facilities where people could use illicit substances in a medically supervised environment to prevent overdose deaths and facilitate treatment.
The state legislature’s Joint Committee on Mental Health, Substance Use and Recovery held a hearing on the harm reduction proposals, with experts and people personally impacted by substance misuse advocating for new approaches to drugs that destigmatize addiction and offer people resources outside of a criminal justice context.
The decriminalization bill would replace criminal penalties for the possession of any controlled substance with a civil fine of up to $50. To avoid the fine, individuals could enroll in a “needs screening to identify health and other service needs, including but not limited to services that may address any problematic substance use and mental health conditions, lack of employment, housing, or food, and any need for civil legal services.”
For the safe injection site legislation, the state would establish a 10-year pilot program where at least two facilities would “utilize harm reduction tools, including clinical monitoring of the consumption of pre-obtained controlled substances in the presence of trained staff, for the purpose of reducing the risks of disease transmission and preventing overdose deaths.”
A separate, less far-reaching bill that was added to the agenda in a late addition would direct the Department of Public Health to simply “evaluate the feasibility” of safe consumption sites and then report back to lawmakers by July 31, 2022..
The joint committee listened to academics, health professionals, lawmakers discuss the reform proposals but did not take immediate action on any of the legislation. It’s unclear when the bills will be taken up again for further consideration.
“By every metric, the war on drugs has been a catastrophic failure,” Rep. Mike Connolly (D) said. “In the United States and here in Massachusetts, the criminalization of drug possession is a major driver of mass incarceration. We know that black people have been incarcerated at a rate eight times higher than white people, and there’s no question that the criminalization of substance use issues has contributed to these terrible disparities.”
Connolly is also the sponsor of legislation that received a Joint Judiciary Committee hearing in July on studying the implications of legalizing psychedelics like psilocybin and ayahuasca.
Officials with at least one Massachusetts city, Somerville, said that there are plans in the work to launch a safe injection facility in the jurisdiction. And they want to see the statewide bill pass to provide additional protections against being federally penalized.
“State legislation, wielding its constitutionally granted powers to enact laws for public health and safety, has the ability to greatly minimize these risks through legislation authorizing a pilot of safe consumption sites,” Hannah Pappenheim, assistant city solicitor at the City of Somerville, said. “In addition, state legislation would also minimize the risk of costly—but more importantly, lengthy—litigation.”
The official noted that a separate, Pennsylvania-based case on the legality of safe injection sites has been ongoing in federal courts for years at this point.
A coalition of 80 current and former prosecutors and law enforcement officials—including one who is President Joe Biden’s pick for U.S. attorney of Massachusetts—recently filed a brief urging the Supreme Court to take up the case.
Xavier Bacerra, the Biden administration’s secretary of health and human services, was among eight top state law enforcement officials who filed an earlier amicus brief in support of the Philadelphia-based Safehouse’s safe injection site plan when he served as California’s attorney general.
“State legislation paves the way for a more expedient process in Somerville, and of course elsewhere in the Commonwealth,” Pappenheim said.
Somerville Mayor Joseph Curtatone (D) said at Monday’s hearing that “it’s important for Massachusetts to finally lead—not just compiling, but implementing a strategy that reduces harm and save lives.” He conceded that he previously opposed the concept of allowing safe consumption sites; but his personal experience knowing people in his immediate family who suffered from addiction—as well as his own review of the scientific literature on harm reduction alternatives to criminalization—led him to embrace the reforms.
Massachusetts lawmakers advanced similar legislation last year, but it was not ultimately enacted.
The governor of neighboring Rhode Island signed a bill in July to establish a safe consumption site pilot program where people could test and use currently illicit drugs in a medically supervised environment. It became the first state in the country to legalize the harm reduction centers. It’s not clear whether the Department of Justice will seek to intervene to prevent the opening of such facilities in that state.
Oamshri Amarasingham, deputy legislative director of the ACLU of Massachusetts, voiced support for both reform proposals at Monday’s hearing and told WGBH that establishing a safe injection site pilot program “is one piece of that puzzle” that is “critically important and that’s had great success in other countries.”
The ACLU has long supported shifting to a #PublicHealth approach to drug policy rather than a criminal one…
— ACLU Massachusetts (@ACLU_Mass) September 27, 2021
Shaleen Title, a former Massachusetts cannabis commissioner who now heads the Parabola Center, juxtaposed how laws handle substances like caffeine, alcohol and nicotine differently from currently illegal drugs.
“What separates that from when we have these illicit drugs, where handcuffs and cages are involved, and what led that to be? The reason has nothing to do with science, or evidence or the relative dangers of those drugs,” she said. “The reason is because—and this is well-documented—those drugs could be scapegoated and blamed on their association with indigenous and Indian and Mexican and Chinese and other cultures, and then used to target communities of color, particularly black and Latino people nationally and here in Massachusetts.”
At the same time that Massachusetts legislators are looking into harm reduction and broad drug decriminalization, local activists in the state have also been pursuing psychedelics reform.
Three Massachusetts cities—Northampton, Somerville and Cambridge—have each passed resolutions to deprioritize enforcement of laws against the possession, use and distribution of a wide range of psychedelics and other drugs. The Easthampton City Council is also exploring a resolution to decriminalize a wide range of entheogenic substances, with a meeting set for Friday.
Marijuana Arrests Dropped Sharply In 2020 As Both COVID And Legalization Spread, FBI Data Shows
Marijuana arrests declined significantly in 2020 amid the coronavirus pandemic, newly released FBI data shows.
There were 1,155,610 drug-related arrests overall last year, with cannabis sales and possession busts accounting for just over 30 percent (or 350,150) of those cases. The vast majority were for marijuana possession alone.
The agency’s data shows that there was a cannabis arrest every 90 seconds in the country in 2020, and there was a drug-related arrest every 27 seconds.
While these figures still highlight the rampant, ongoing criminalization of cannabis in states across the U.S., it’s a substantial deescalation compared to 2019, when FBI reported a total of 545,601 marijuana arrests. That amounted to a cannabis bust every 58 seconds.
Put another way, there was a 36 percent decrease in cannabis cases from 2019 to 2020. And while the federal agency doesn’t attempt to explain the statistical shift, there are a number of factors that could help explain it.
One of the more obvious societal changes during that timeframe is the COVID-19 health crisis, which involved social distancing requirements and generally discouraged people from being out in public where they might be at higher risk of being arrested for simple possession.
But advocates have also pointed out that the marijuana reform movement could be playing a role. Illinois’s adult-use cannabis law took effect at the beginning of 2020, for example. Hawaii, New Mexico and North Dakota also enacted decriminalization of marijuana possession in 2019, and Virginia followed suit the next year.
In Arizona, limited cannabis possession was legalized for adults starting on November 30, 2020 following voter approval of a reform initiative earlier that month.
“As more states move toward the sensible policy of legalizing and regulating cannabis, we are seeing a decline in the arrest of non-violent marijuana consumers nationwide,” NORML Executive Director Erik Altieri told Marijuana Moment. “The fight for legalization is a fight for justice. While these numbers represent a historic decline in arrests, even one person being put into handcuffs for the simple possession of marijuana is too many.”
Despite the decline in cannabis busts, the new data shows that American law enforcement still carried out more arrests for marijuana alone last year than for murder, rape, robbery, burglary, fraud and embezzlement combined.
It should be noted that not all local police participate in FBI’s reporting program, so these figures are not holistic and are estimates the agency makes based on those that do submit data.
The country had seen a consistent decline in cannabis arrests for roughly a decade prior to 2016, when those cases started to rise up until 2019.
Observers expect to see the downward trend in cannabis busts continue as more states move to end prohibition and law enforcement deprioritizes marijuana-relate cases. In New York, for example, police received new guidance this year stipulating that adults 21 and older can possess certain amounts of marijuana and consume it in places where tobacco use is permitted.
That directive alone seems to have led to a dramatic decrease in cannabis arrests in New York City.
Federal marijuana trafficking cases also continued to decline in 2020 as more states have moved to legalize, an analysis from the U.S. Sentencing Commission (USSC) that was released in June found.
Federal prosecutions of drug-related crimes overall increased in 2019, but cases involving marijuana dropped by more than a quarter, according to an end-of-year report released by Supreme Court Chief Justice John Roberts in December.
A study released by the Cato Institute in 2018 found that “state-level marijuana legalization has significantly undercut marijuana smuggling.”