A congressman introduced a bill on Friday that would create a variety of programs and grants to help people enter the hemp industry and build their businesses. It would also require a federal study into potential alternative uses for the crop as well as challenges faced by the market.
Rep. Denver Riggleman (R-VA) filed the Hemp Opportunity Zone Act. As the title implies, the main component of the legislation clarifies that farmers who cultivate the crop can receive tax benefits if they operate in an area designated as an “opportunity zone” by the Treasury Department.
Opportunity zones are census-designated low-income areas that are considered economically distressed. The governor of a state can make the designation, and Treasury then decides whether to certify it. The program is designed to promote investments in communities that might typically be overlooked by allowing investors to defer capital gains taxes if they put money into an opportunity zone business.
“We are reviewing the legislation now, but if it indeed serves to open up investment in hard-hit farming and small business communities, it would be welcome relief for an industry that has been struggling through the COVID pandemic and federal burdens imposed by FDA, USDA and now the DEA,” Jonathan Miller, general counsel for the U.S. Hemp Roundtable, told Marijuana Moment.
Treasury Sec. Steven Mnuchin earlier this year weighed in on eligibility for the opportunity zone program with respect to the marijuana industry and said “it is not the intent of the opportunity zones that if there is this conflict [between state and federal marijuana laws] that has not been cleared that, for now, we should not have those businesses in the opportunity zones.”
In addition to clarifying eligibility for hemp-focused businesses, Riggleman’s new bill would also create a “hemp farmer start-up tax credit” equal to 10 percent of the cash rent paid for land used for production or 15 percent of the “crop share rent so paid by the taxpayer.” To be eligible, farmers would need to have less than $25 million in gross receipts for the last taxable year.
The Hemp Opportunity Zone Act is a huge win for farmers in #VA05. Hemp farming is a new and thriving industry. By providing these tax incentives hemp growers in Virginia and the 5th District are primed to lead based on their historic production of tobacco. https://t.co/LncEw7SQsS
— Congressman Denver Riggleman (@RepRiggleman) August 29, 2020
The legislation would further establish a “small hemp farmer credit” that would enable businesses with less than $250,000 in gross receipts for the previous taxable year to obtain a credit “equal to 30 percent of the basis of hemp farming property placed in service.”
“Hemp farming is a new and thriving industry,” Riggleman, who lost his primary renomination bid this year and only has a few months left in Congress, said. “By providing these tax incentives hemp growers in Virginia and the 5th District are primed to lead based on their historic production of tobacco.”
He said that expanding opportunity zone eligibility to the market “will incentivize investments into long neglected neighborhoods that will spur economic growth and combat poverty.”
Finally, the bill also calls on the Treasury Department to work with the U.S. Department of Agriculture (USDA) on a study of the hemp industry.
The report would look at opportunities to use hemp seeds in animal feed, the potential use of hemp products as protective equipment for medical workers and first responders and the “feasibility” of certain USDA regulations for the market.
Certain questions the study would address concern complaints industry stakeholders have made about USDA’s interim final rule for the crop. Treasury and USDA would have to consider the department’s hemp sampling requirements and its 0.3 THC limit for the crop.
The agencies would also have to explore how the U.S. competes “globally with other countries that have a 1.0 percent THC limitation.” The bill states that the study should additionally consider the potential benefits of including hemp-based food items in “certain public school meal plans” and whether any items used by the federal government or its contractors “can be substituted by a hemp-based product.”
Several of those areas of study were addressed in a bill introduced by Rep. Tulsi Gabbard (D-HI) last year.
Meanwhile, several lawmakers have recently implored USDA to delay the implementation of its proposed hemp rules, citing concerns about certain restrictive policies the agency has put forward in its draft regulations.
Senate Minority Leader Chuck Schumer (D-NY) earlier this month wrote to Agriculture Secretary Sonny Perdue, similarly asking that USDA delay issuing final regulations for the crop until 2022 and allow states to continue operating under the 2014 Farm Bill hemp pilot program in the meantime.
As it stands, the earlier pilot program is set to expire on October 31. The minority leader isn’t alone in requesting an extension, as state agriculture departments and a major hemp industry group made a similar request to both Congress and USDA this month.
As USDA works to finalize their regulations, which they intend to complete by October 2021, the department has been systematically approving hemp plans proposed by individual states, territories and tribes. The most recent approvals were for Maryland and the Lower Sioux Indian Community.
Six states that submitted hemp regulatory plans to USDA are being asked to make revisions and resubmit before they’re approved.
Read the text of the Hemp Opportunity Zone Act below:
Photo courtesy of Brendan Cleak.
Kansas Medical Marijuana Hearings Cancelled After Senate GOP Leader Reroutes House-Passed Bill
A House-passed bill to legalize medical marijuana in Kansas seems to be in jeopardy, with GOP Senate leadership moving the legislation out of a committee and into a different panel where it may sit in legislative limbo, resulting in the cancellation of hearings that were scheduled to be held this week.
Advocates are concerned about the decision by Senate President Ty Masterson (R), who withdrew the cannabis reform legislation from the Senate Federal and State Affairs Committee days before hearings were to be held on Tuesday and Wednesday. It was then re-referred to the Senate Interstate Cooperation Committee, which Masterson chairs and where the bill’s fate is unclear.
This doesn’t necessarily mean that medical marijuana legalization is off the table for Kansas in 2022, but it does seem to signal that the reform might need to be enacted through another vehicle, either in the legislature or at the ballot, as top Democratic lawmakers in the state are pursuing.
“We certainly hope that this action is just making sure that this bill meets any concerns that Senate leadership may have concerning this historic legislation,” Kevin Caldwell, a legislative manager at Marijuana Policy Project (MPP), told Marijuana Moment. “This bill had widespread bipartisan support in the House last session. We hope Senate President Masterson quickly holds a committee hearing and advances this legislation.”
When the proposal was being advanced in the House last year during the first half of the two-year session, members amended an unrelated bill that previously cleared the Senate to make it the chamber’s vehicle for the policy change. Because of that, it was ruled “materially changed” last May and sent to the Senate for committee consideration.
Now there’s a question of whether lawmakers will be motivated to introduce another separate bill and try to move it through both chambers, requiring another House vote. The Senate president seemed to temper expectations in recent remarks, telling The Kansas City Star that “not a single member” of his caucus has expressed that the issue “was important to them.”
That’s not how Kansas Democrats feel, however. House Minority Leader Tom Sawyer (D) and Assistant Minority Leader Jason Probst (D) said this month that they will be introducing proposals to let voters decide on legalizing medical and adult-use marijuana in the state. At the time, Sawyer said he was “hopeful” that the legislature might separately advance the House-passed legalization measure.
Marijuana Moment is already tracking more than 1,000 cannabis, psychedelics and drug policy bills in state legislatures and Congress this year. Patreon supporters pledging at least $25/month get access to our interactive maps, charts and hearing calendar so they don’t miss any developments.
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“The people of Kansas deserve to know if senators support the overwhelming majority of people who want to alleviate patients’ suffering with a medical cannabis program,” MPP’s Caldwell said. “Now is the time to show compassion to their fellow citizens and vote this bill out of committee.”
“Kansas is one of fourteen states left without a medical cannabis program,” he said. “We have faith that the Kansas Senate will pass this legislation this session and this is just another step in that process.”
Michael Pirner, Masterson’s communications director, told the Star that “medical marijuana legislation is not a priority of Senate leadership,” but did signal the issue may still be considered before the year is over.
“The subject matter has clearly matured and we expect it to be considered at some level this session,” he said. “There are many more pressing topics on the Senate agenda.”
The bill as drafted contains several significant restrictions, including a ban on smokeable cannabis. Members of the Senate Federal and State Affairs Committee did get a briefing on the issue at a meeting last week ahead of the expected, now-cancelled formal hearings before the panel.
Meanwhile, the constitutional amendment that the Democratic leaders are proposing would provide for a more comprehensive program that lawmakers would need to implement.
Gov. Laura Kelly (D), for her part, wants to see medical cannabis legalization enacted, and she said at a briefing with reporters on Friday that she “absolutely” thinks the bill could pass if “everything else doesn’t take up all the oxygen.”
She previously pushed a separate proposal that would legalize medical cannabis and use the resulting revenue to support Medicaid expansion, with Rep. Brandon Woodard (D) filing the measure on the governor’s behalf.
Kelly has she said she wants voters to put pressure on their representatives to get the reform passed.
The governor also said in 2020 that while she wouldn’t personally advocate for adult-use legalization, she wouldn’t rule out signing the reform into law if a reform bill arrived on her desk.
Photo courtesy of Philip Steffan.
Marijuana Banking Bill Sponsor Says He’s ‘Gonna Get That Darn Thing Passed’ Before Leaving Office
Rep. Ed Perlmutter (D-CO) is retiring from Congress at the end of this session, but he says that he’s going to work to pass his marijuana banking bill before his time on Capitol Hill comes to an end.
The congressman spoke to Colorado Public Radio last week about his decision not to run for reelection this November and his disappointment that, while the House has approved the Secure and Fair Enforcement (SAFE) Banking Act five times now in some form, the Senate has failed to advance it under both Republican and Democratic leadership.
“That one still has me pretty irritated,” Perlmutter said, referring to the fact that Senate Majority Leader Chuck Schumer (D-NY) has effectively blocked his bipartisan legislation. When there was a GOP Senate majority, he was told the bill was “too big and too broad.” Then with a Democratic majority, he’s told that it’s “too narrow and too limited.”
Schumer and his colleagues who are working on a federal legalization bill have repeatedly said that they do not want to see the SAFE Banking Act pass before comprehensive reform is enacted that addresses equity issues. Supporters of the banking bill argue that the incremental policy change is necessary for promote public safety and, importantly, it stands a much stronger chance of getting to the president’s desk with bipartisan support.
Nonetheless, Perlmutter said he plans to spend his remaining months in office pushing to get the job done.
“I have not given up on that one,” he said. “I’m gonna get that darn thing passed this year while I still serve out my term.”
Listen to Perlmutter discuss the marijuana banking legislation, starting around 10:24 into the audio below:
Asked whether he thinks President Joe Biden would be inclined to sign the measure if it did get to his desk, the congressman said “absolutely.”
“Treasury Secretary [Janet] Yellen is somebody who has been talking to me about this for years,” he said. “I feel very good that it would pass. We’re at 47 states that have some level of marijuana use, all the territories and District of Columbia, and they need to have legitimate banking services.”
“It’s just a no brainer in my opinion,” he said. “And yeah, I’m a little bit irritated, but we’re gonna keep working on it and get it passed this year.”
The last attempt that Perlmutter made to enact the reform was by adding its language to a must-pass defense bill, but it was ultimately sidelined following bicameral negotiations and did not make it into the final version. The congressman told Marijuana Moment last month that he sees other potential vehicles to advance the bill and has spoken with House Speaker Nancy Pelosi (D-CA) about it.
Even some Republicans are scratching their heads about how Democrats have so far failed to pass the modest banking reform with majorities in both chambers and control of the White House. For example, Rep. Rand Paul (R-KY) criticized his Democratic colleagues over the issue last month.
Top Federal Drug Official Says ‘Train Has Left The Station’ On Psychedelics As Reform Movement Spreads
A top federal drug official says the “train has left the station” on psychedelics.
National Institute on Drug Abuse (NIDA) Director Nora Volkow said people are going to keep using substances such as psilocybin—especially as the reform movement expands and there’s increased attention being drawn to the potential therapeutic benefits—and so researchers and regulators will need to keep up.
The comments came at a psychedelics workshop Volkow’s agency cohosted with the National Institute of Mental Health (NIMH) last week.
The NIDA official said that, to an extent, it’s been overwhelming to address new drug trends in the psychedelics space. But at the same time, she sees “an incredible opportunity to also modify the way that we are doing things.”
“What is it that the [National Institutes of Health] can do to help accelerate research in this field so that we can truly understand what are the potentials, and ultimately the application, of interventions that are bought based on psychedelic drugs?” Volkow said.
The director separately told Marijuana Moment on Friday in an emailed statement that part of the challenge for the agency and researchers is the fact that psychedelics are strictly prohibited as Schedule I drugs under the federal Controlled Substances Act.
“Researchers must obtain a Schedule I registration which, unlike obtaining registrations for Schedule II substances (which include fentanyl, methamphetamine, and cocaine), is administratively challenging and time consuming,” she said. “This process may deter some scientists from conducting research on Schedule I drugs.”
“In response to concerns from researchers, NIDA is involved in interagency discussions to facilitate research on Schedule I substances,” Volkow said, adding that the agency is “pleased” the Drug Enforcement Administration recently announced plans to significantly increase the quota of certain psychedelic drugs to be produced for use in research.
“It will also be important to streamline the process of obtaining Schedule I registrations to further the science on these substances, including examining their therapeutic potential,” she said.
At Thursday’s event, the official talked about how recent, federally funded surveys showed that fewer college-aged adults are drinking alcohol and are instead opting for psychedelics and marijuana. She discussed the findings in an earlier interview with Marijuana Moment as well.
Don't miss out on the @NIDAnews, @NIAAAnews, & @NIMHgov-sponsored virtual Workshop on Psychedelics as Therapeutics: Gaps, Challenges, and Opportunities, Jan. 12‒13, 2022. Learn more and register: https://t.co/S1zttkoYXq pic.twitter.com/C2Qrk6FN9a
— NIDAnews (@NIDAnews) January 10, 2022
“Let’s learn from history,” she said. “Let’s see what we have learned from the marijuana experience.”
While studies have found that marijuana use among young people has generally remained stable or decreased amid the legalization movement, there has been an increase in cannabis consumption among adults, she said. And “this is likely to happen [with psychedelics] as more and more attention is placed on these psychedelic drugs.”
“I think, to a certain extent, with all the attention that the psychedelic drugs have attracted, the train has left the station and that people are going to start to use it,” Volkow said. “People are going to start to use it whether [the Food and Drug Administration] approves or not.
There are numerous states and localities where psychedelics reform is being explored and pursued both legislatively and through ballot initiative processes.
On Wednesday—during the first part of the two-day federal event that saw nearly 4,000 registrants across 21 time zones—NIMH Director Joshua Gordon stressed that his agency has “been supporting research on psychedelics for some time.”
Tune in today and tomorrow for the @NIH workshop on Psychedelics as Therapeutics, which will examine findings on psychoplastogens for treating depression, post-traumatic stress, and substance and alcohol use disorders. https://t.co/Qzxte5xJt9
— Joshua A. Gordon (@NIMHDirector) January 12, 2022
“We can think of NIMH’s interests in studying psychedelics both in terms of proving that they work and also in terms of demonstrating the mechanism by which they work,” he said. “NIMH has a range of different funding opportunity announcements and other expressions that are priorities aimed at a mechanistic focus and mechanistic approach to drug development.”
Meanwhile, Volkow also made connections between psychedelics and the federal response to the coronavirus pandemic. She said, for example, that survey data showing increased use of psychedelics “may be a way that people are using to try to escape” the situation.
But she also drew a metaphor, saying that just as how the pandemic “forced” federal health officials to accelerate the development and approval of COVID-19 vaccines because of the “urgency of the situation,” one could argue that “actually there is an urgency to bring treatments [such as emerging psychedelic medicines] for people that are suffering from severe mental illness which can be devastating.”
But as Volkow has pointed out, the Schedule I classification of these substances under federal law inhibits such research and development.
The official has also repeatedly highlighted and criticized the racial disparities in drug criminalization enforcement overall.