Washington, D.C. lawmakers have advanced an amended bill to fundamentally reshape the District’s medical marijuana program—including by eliminating cannabis business licensing caps, providing tax relief to operators, further promoting social equity and creating new regulated business categories such as on-site consumption facilities and cannabis cooking classes.
The District Council’s Committee on Business and Economic Development approved the legislation—which would also codify that adults can self-certify as medical marijuana patients—on Tuesday. This comes about a month after an earlier version cleared a different panel.
The main components of the bill, which is being carried by Council Chairman Phil Mendelson (D) on behalf of Mayor Muriel Bowser (D), have stayed intact. But provisions dealing with issues such as licensing enforcement and the tax code were revised ahead of Tuesday’s committee markup.
The Medical Cannabis Amendment Act now heads to the Committee of the Whole before potentially receiving final sign-off by the District Council.
“The public and voters have decided that they want to see a different framework in the District of Colombia,” the committee chairman, Councilmember Kenyan McDuffie (D), said on Tuesday. “We’ve done that over the years, and this is just one additional step where we’re trying to fulfill those commitments to both the initiatives and laws that we pass in the District of Columbia around medical cannabis.”
Another component of the legislation would empower officials to crack down on “gifting” operators that sell non-cannabis items in exchange for “free” marijuana products. The aim is to encourage those businesses to become part of the legal and regulated market by taking advantage of the new licensing opportunities.
Lawmakers have gone back and forth over how to most effectively revise D.C.’s licensing rules, with the as-introduced version of the legislation proposing a higher cap on dispensaries than is allowed under current law and another earlier version seeking a full elimination of the business license caps. This latest revised bill would still remove the cap, while also giving regulators discretion to set limits.
“The Board shall issue rules within 180 days of the effective date of the Act to establish processes and procedures for requesting, reviewing, and implementing a cap or moratorium on the issuance of retailer or internet retailer licenses in a Ward, [Advisory Neighborhood Commission], or Single Member District of an ANC,” the latest bill text says.
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– Provident Group/Bison Properties Revenue Bonds Project Approval
– Child Wealth Building Act
– Howard University Property Tax Exemption Clarification Act
– Medical Cannabis Act
– Fair Meals Delivery Act
— Council of DC (@councilofdc) November 29, 2022
One of the most significant changes concerns tax policy for the cannabis industry, with the committee approving the revised bill with language that says marijuana businesses can deduct taxes under local statute that they’re prohibited from making under the federal Internal Revenue Services (IRS) code known as 280E.
Additionally, the legislation codifies that people 21 and older can self-certify as medical cannabis patients who can buy marijuana from dispensaries without receiving a doctor’s recommendation.
Under the temporary self-certification law that the mayor signed this year, medical marijuana patient registrations have continued to surge—with the program adding about 1,500 more patients in September alone.
The measure also gives city officials authority to take enforcement action against anyone who “knowingly engages or attempts to engage in the purchase, sale, exchange, or any other form of commercial transaction involving cannabis that is not purchased, sold, or exchanged” under the gifting provision of the District’s marijuana law.
However, the timeline for when enforcement action can be taken was pushed back in the amended bill, requiring regulators to wait 225 days, rather than 180 in the earlier version, to penalize non-compliant businesses. One lawmaker said at the hearing that this was necessary to ensure that there’s sufficient time for currently unlicensed operators to transition to the regulated market.
The amended bill is still meant to promote social equity in the industry by prioritizing business licenses for people who’ve been disproportionately impacted by the drug war. But rather than stipulate that 50 percent of certain licenses must be set aside for equity applicants and existing medical cannabis operators in perpetuity, as the last committee-approved version did, this one requires 100 percent to be set aside for those groups for a certain number of years, depending on the license type.
Even after that window closes, the bill says current medical marijuana businesses and social equity applicants “shall receive priority review.”
The legislation was also changed to rename the key regulatory agency, from the Alcoholic Beverage Regulation Administration (ABRA) to Alcoholic Beverage and Cannabis Administration (ABC).
McDuffie also pointed out at the markup that this is “a big bill and and I imagine there might be some tweaks between now and what it looks like” in the Committee of the Whole.
While advocates have welcomed the legislative efforts to expand cannabis access in the District, many continue to push for an end to the federal blockade that’s prevented D.C. from establishing a regulated market, despite voters approving an initiative to legalize possession and personal cultivation in 2014.
After President Joe Biden issued a proclamation last month pardoning Americans who’ve committed federal marijuana possession offenses, as well as people who’ve violated the law in D.C., U.S. Rep. Eleanor Holmes Norton (D-DC) called on the president to go further by federally legalizing cannabis and letting the District establish a commercial cannabis market and grant clemency on its own.
The congresswoman said the ongoing local ban, which was maintained in Biden’s last two budget proposals, represents a “shocking violation of D.C. home rule by a Democratic administration.”
A coalition of local, state and national advocacy organizations recently asked the U.S. attorney general to formally adopt a policy of non-enforcement to allow Washington, D.C. to legalize marijuana sales even in light of the ongoing congressional ban.
A poll released in September found that D.C. voters strongly support marijuana legalization and oppose a crackdown on the cannabis “gifting” market that’s emerged in the absence of regulated sales.
D.C. lawmakers also recently sent letters to House and Senate Appropriations Committees leadership, imploring them to remove the rider preventing local cannabis sales as part of Fiscal Year 2023 spending legislation.
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The House passed the relevant spending bill for FY 2023 in July, excluding the D.C. marijuana prohibition language. In the Senate, the legislation that’s currently on the table from the Democratic Appropriations Committee chairman also omits the rider.
Bowser, Norton and other elected officials in the city have routinely criticized Congress for singling out the District and depriving it of the ability to do what a growing number of states have done without federal interference.
Norton told Marijuana Moment in a phone interview in July that she’s “fairly optimistic” that the rider will not be included in the final spending package. She added that the D.C. self-certification policy is an “effective workaround” until then.
Meanwhile, the mayor signed a bill in July that bans most workplaces from firing or otherwise punishing employees for marijuana use.
The reform is designed to build upon on a previous measure lawmakers approved to protect local government employees against workplace discrimination due to their use of medical cannabis.
Read the revised version of the D.C. medical cannabis bill below:
Photo courtesy of Philip Steffan.