Minnesota Lawmakers Resolve Most Remaining Differences In Marijuana Legalization Bills During Second Conference Meeting

A Minnesota legislative conference committee held its second meeting on a pair of House and Senate marijuana legalization bills on Monday, reconciling most of the remaining differences as a deadline for final passage looms.

Bipartisan and bicameral negotiators tackled several key sections of the legislation, including provisions on licensing, expungements and criminal penalties. But tax- and appropriations-related issues must still be resolved by the panel—and agreed to by the full legislature—before the House’s planned adjournment for the year on Thursday.

The reason for the conference committee is that both the House and Senate passed cannabis legalization bills last month that were separately amended over the course of a weeks-long committee process. As such, differences need to be addressed before a final unified bill can move through both chambers again and be sent to the governor’s desk.

Rep. Zack Stephenson (D) and Sen. Lindsey Port (D), sponsors of the bills, are among the conference negotiators who will need to meet at least one more time to deal with remaining articles on taxes and appropriations. They panel held its first meeting on Friday, and members will hold a third conference on Tuesday.

At Monday’s meeting, the conference committee worked articles 1, 4 and 5, as well as remaining sections of article 6, of the bill—with the panel again largely opting to accept House versions of most provisions.

The cannabis conference committee met this morning and adopted:

Article 1: Licensing
Article 4: Criminal Penalties
Article 5: Expungement
Article 6: Misc Provisions

We are meeting tomorrow as well. The only articles remaining are Article 2: Taxes, and Article 9: Appropriations

— Zack Stephenson (@zackstephenson) May 15, 2023

One negotiated decision sets an at-home possession limit of two pounds of marijuana.

The House bill would have allowed people to possess up to 1.5 pounds in a private dwelling, while the Senate bill would have let people have up to five pounds of self-cultivated cannabis at home and up to two pounds derived from any other source.

Some advocates are concerned that the conference committee’s decision will effectively criminalize a person harvesting their legally grown plants.

We are allowing Minnesotans to cultivate 8 plants, 4 mature. Each plant produces on the low end, 1 pound. This means, that if you're growing to the limit allowed by this legislation, when you harvest, you're committing a felony.

— Maren Joyce (@MarenJoyce) May 15, 2023

The panel also adopted a series of amendments, including a provision to allow localities to limit the number of marijuana business licenses based on population size, similar to provisions in the Senate-passed version of the bill—but with higher minimum license numbers than approved by the Senate.

Other amendments that were accepted would give regulators authority to make decisions on health and safety warnings and potency limits, create a new medical cannabis combination license for businesses to provide both medical and adult-use marijuana, ensure that existing state medical cannabis regulatory employees can transfer their employment to the new Office of Cannabis Management and add a patient with experience in the mental health system or substance use disorder treatment system to the Cannabis Advisory Committee.

Members also agreed to expand criminal background check to every cooperative member, director, manager and general partner of a marijuana business and set a definition for social equity applicants, including clarifying that people with cannabis possession or sales convictions would qualify.

Under additional amendments, the bill will provide further data classification for investigations, allow for higher canopy sizes for cultivation businesses while also allowing regulators to increase them to meet demand, allow mid-size mezzobusinesses to grow and process medical cannabis, ensure that labor peace agreement requirements apply to low-potency hemp cannabinoid product businesses and make on-site cannabis consumption facilities liable for injuries or death that results from illegal sales.

After that, our nonpartisan staff will process all the changes we've made, and put together a final bill for a final vote in the House and Senate. Because the bill is so long, and so complicated, this could take a bit. But!!!! We WILL get the bill done before the end of session!

— Zack Stephenson (@zackstephenson) May 15, 2023

The conference committee further adopted amendments expanding expungement provisions, adding language concerning compacts with Indian tribes, changing provisions on operating motor vehicles or carrying firearms under the influence of cannabis and making technical changes to definitions in the bill.

Several expungements-related sections of the bill were also deleted because they are similar to provisions that are already included in a separate judiciary and public safety omnibus bill that is being enacted.

Rep. Nolan West (R), one of two Republicans who were appointed as negotiators, proposed amendments to revise the definition of artificially derived cannabinoids, permit cannabinoids that are naturally contained in cannabis plants to be in low-potency hemp products and allow for variability in cannabinoid content within the margin generally recognized for the analytical method used to perform testing—but they were all rejected.

West withdrew additional amendments to allow low-potency hemp products to be displayed in locked cases in stores instead of having to be behind the counter, with Stephenson saying he would be open to adopting a similar change at the panel’s next meeting.

Sen. Jordan Rasmusson (R) separately raised concerns about the certain adopted language around local control and labor peace agreements. He proposed an amendment to delay effective date of some changes to criminal penalties to August 1, 2024, but that was defeated.

Rasmusson withdrew an amendment that sought to include adults as targets of cannabis education programs in addition to youth, with Port saying members would discuss the proposal further at Tuesday’s meeting.

Once the conference committee comes up with a final product, the revised bill will need to go back for votes in both chambers before it’s sent to the governor.

Gov. Tim Walz (D), who released an biennial budget request in January that included proposed funding to implement marijuana legalization and expungements, has already pledged to sign the legislation when he receives it.

With majorities in both the House and Senate and control over the governorship this session, Democratic-Farmer-Labor party officials have been expressing confidence that legalization will be enacted this year.

The legislation that advanced through both chambers is an iteration of the 2021 House-passed bill from former Majority Leader Ryan Winkler (D), who now serves as campaign chairman of the advocacy coalition MN is Ready.

The governor has called on supporters to join lawmakers and the administration in their push legalize marijuana this session, and he circulated an email blast in January that encourages people to sign a petition backing the reform.

Here are the main components of the revised marijuana legalization bills, HF 100 and SF 73:

Adults 21 and older could purchase and possess in public up to two ounces of cannabis and they would be allowed to cultivate up to eight plants at home, four of which could be mature.

People could possess up to two pounds of marijuana at home.

Gifting up to two ounces of marijuana without remuneration between adults would be permitted.

Prior marijuana records would also be automatically expunged. The Bureau of Criminal Apprehension would be responsible for identifying people who are eligible for relief and process the expungements.

In addition to creating a system of licensed cannabis businesses, municipalities and counties could own and operate government dispensaries.

On-site consumption permits could be approved for events, and cannabis delivery services would be permitted under the bill.

Local governments would not be allowed to prohibit marijuana businesses from operating in their areas, though they could set “reasonable” regulations on the time of operation and location of those businesses and limit the number of cannabis business licenses based on population size.

Under the House bill, cannabis sales would be taxed at eight percent—and thereafter, the commissioner of management and budget would adjust the rate every two years so that revenues equal, or do not significantly exceed, the costs of implementing legalization incurred by various agencies. The Senate bill calls for a 10 percent tax rate on marijuana sales that would not change over time.

Part of the tax revenue would fund substance misuse treatment programs, as well as grants to support farmers.

A new Office of Cannabis Management would be established, and it would be responsible for regulating the market and issuing cannabis business licenses. There would be a designated Division of Social Equity.

The legislation would promote social equity, in part by ensuring diverse licensing by scoring equity applicants higher. People living in low-income neighborhoods and military veterans who lost honorable status due to a cannabis-related offense would be considered social equity applicants eligible for priority licensing, and the House bill says that people convicted of cannabis offenses, or who have an immediate family member with such a conviction, would also qualify.

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The House bill was vetted by numerous committees before reaching the floor. It passed the Ways and Means Committee, Taxes Committee, Transportation Finance and Policy Committee, Economic Development Finance and Policy Committee, Public Safety Finance and Policy Committee, Health Finance and Policy Committee, Education Finance Committee, Human Services Policy Committee, Workforce Development Finance and Policy Committee, Agriculture Finance and Policy Committee, State and Local Government Finance and Policy Committee, Labor and Industry Finance and Policy Committee, Environment and Natural Resources Finance and Policy Committee, Judiciary Finance and Civil Law Committee and Commerce Finance and Policy Committee (twice).

The Senate committees that have signed off on the bill are the Finance Committee, Taxes Committee, Rules and Administration Committee, State and Local Government and Veterans Committee, Labor Committee, Human Services Committee, Health and Human Services Committee, Transportation Committee, Environment, Climate, and Legacy Committee, Agriculture, Broadband, and Rural Development Committee, Jobs and Economic Development Committee, Commerce and Consumer Protection Committee and Judiciary and Public Safety Committee (twice).

Following their election win in November, Democrats internally agreed to discuss the issue imminently.

A poll released last week found that 64 percent of Minnesota registered voters support creating a regulated marijuana market, including 81 percent of Democrats and a 49 percent plurality of Republicans.

Two polls released in September found that the majority of Minnesota residents support adult-use marijuana legalization—and one survey showed that even more Minnesotans approve of the state’s move to legalize THC-infused edibles that was enacted last year.

A survey conducted by officials with the House at the annual State Fair that was released in September also found majority support for legalization. That legislature-run poll found that 61 percent of Minnesotans back legalizing cannabis for adult use.

Support was up this year from 58 percent when the House Public Information Services polled fair goers on the issue in 2021. In 2019, the House poll found 56 percent support for legalization.

Meanwhile in Minnesota, the House separately passed an omnibus health bill last month that contains provisions to create a psychedelics task force meant to prepare the state for possible legalization.

The large-scale Senate legislation was amended in the House earlier this month to include language from a standalone psychedelics measure sponsored by Rep. Andy Smith (D). The proposal is expected to move to a bicameral conference committee, where members will reconcile differences between the House and Senate proposals.

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