A novel bill that would allow Oregon to export and import marijuana to other legal states is heading to the governor’s desk after the House approved in on Tuesday.
The legislation, which passed the Senate last month, would permit the governor to enter into agreements with other states under certain circumstances in order to engage in interstate cannabis commerce. It would only be actionable if the federal government reforms its policies and allows such activity, however.
The chamber approved the bill in a 42 to 17 vote.
“This is a very strong statement by the Oregon Legislature, and one that will reverberate across the country,” Sen. Floyd Prozanski (D), the bill sponsor, said in a press release. “The future of this industry is that cannabis will primarily be grown where it grows best, and most efficiently, and most sustainably. That’s what functioning legal markets do.”
States involved in the agreement must border Oregon and must have legal marijuana systems in place, meaning at this point the state could contract with California, Washington and Nevada. Idaho also borders the state, but it does not currently allow legal cannabis. Transporting marijuana products would have to occur via roadways rather than through airspace.
There would also be requirements to establish a tracking system for the products, impose public safety standards and ensure that all transported items follow Oregon’s laws for labeling and packaging marijuana.
Language of the legislation indicates that the federal government wouldn’t necessarily have to formally legalize cannabis for it to become operative. That’s one possibility, but the other is that the Justice Department could adopt an administrative policy that “allows or tolerates interstate transfer of marijuana items.”
Preventing the transportation of cannabis across state lines has been a focus for the Justice Department, which included such activity in a list of enforcement priorities under a now-rescinded Obama-era memo.
But if the federal government does at least tolerate interstate marijuana commerce, the law could help resolve Oregon’s cannabis supply problems. The state has produced more marijuana than there’s demand for, and so opening the market to its neighboring states could mitigate that issue.
“This bill is a strategic business approach,” Rep. Carl Wilson (R) said. “It correctly assesses the industry’s strengths and foresees a time when export turns Oregon’s oversupply in a constrained market into a traded commodity in a national marketplace.”
“Cannabis policy is rapidly evolving in the United States; the federal stance toward marijuana could change quickly, with congressional action or something as simple as a memo from Dept. of Justice,” he said. “In this arena, Oregon has competitive advantage on the nation and the world.”
Because there are so many uncertainties surrounding the legislation’s potential economic impact, a fiscal note states that the “likelihood of losing revenue is as strong as the probability of gaining revenue” under the legislation.
Gov. Kate Brown (D) had a hand in advancing the bill through the legislature and is expected to sign it.
Also on Tuesday, the Senate approved legislation that would enable individuals with prior convictions for cannabis conduct made legal under the state’s marijuana program to have their records cleared by simply filling out a form. The bill—which by coincidence is numbered S.B. 420—cleared the chamber in a 25 to 4 vote and now heads to Brown’s desk.