One day after New Mexico’s House of Representatives passed legislation to legalize marijuana for adults 21 and older, a Senate panel held a Saturday hearing to take initial testimony on three competing legalization bills introduced in that chamber.
The committee did not vote on any of the measures, instead using the hearing to compare the various Senate proposals to one another as well as to the House-passed legislation, HB 12. “I think we’re just trying to get a feel for these four bills,” said Senate Tax, Business and Transportation Committee Chairman Benny Shendo Jr. (D), who led the hearing.
The bills’ sponsors will now work to combine elements of the various Senate proposals before returning to the committee for a possible vote next Saturday. Despite overlap on some issues, major disagreements remain over the structure of the commercial cannabis market, how tax revenue will be allocated and the makeup of a state oversight board that would regulate the new industry.
“In the next week, basically, the sponsors of these four bills need to see if we can get to one bill,” Senate Majority Leader Peter Wirth (D) said at the hearing, “and make a decision in this committee so that we don’t end up in a situation where there’s just multiple moving pieces.”
If backers can’t do that, Wirth added, “there’s a good chance we end up with nothing” by the time the legislative session ends on March 20.
— NM Senate Democrats (@NMSenateDems) February 27, 2021
Sen. Jacob Candelaria’s (D) SB 363 is the most closely aligned with the House measure, although Republican members of the Senate panel said they prefer SB 288, introduced by GOP Sen. Cliff Pirtle, who said he brought the measure “because I felt like something as important as legalizing the sale of recreational cannabis really needed to have a bipartisan approach.”
Sen. Craig Brandt (R), a member of the Senate panel, indicated he’s open to legalization depending on how it’s done.
“I think I can support this issue with the right pieces,” he said at the end of Saturday’s hearing, adding that SB 288 is “very close” to what he’d like to see in marijuana legislation. “There are certain things that I cannot and will not support in the House bill.”
— NM Senate Democrats (@NMSenateDems) February 27, 2021
The third bill in the Senate, SB 13, is a pared-down version of the other legalization proposals and is seen as a comparative outlier. The industry-backed bill’s House companion, HB 17, sponsored by Rep. Tara Lujan (D), was defeated in a House committee earlier this month as lawmakers proceeded with HB 12.
Lujan spoke in favor of SB 13 at the Senate hearing on behalf of the bill’s sponsor, Sen. Daniel Ivey-Soto (D), warning the panel against adopting an overly complex bill.
“There is a lot of stuff going on here,” Lujan said, “and I’ve seen cannabis legislation fail because it’s too complicated.”
But Rep. Javier Martínez (D), lead sponsor for HB 12, seemed to dismiss that criticism later in the hearing, stressing that it’s important the new law be comprehensive.
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“This is a big deal,” he said. “This is a big industry that we’re about to create, and we get a chance to design what the industry will look like ahead of time. That hasn’t happened with the other big industries in New Mexico.”
Martínez’s bill, passed Friday by House lawmakers in a 39–21 vote, would set up an extensive system of licensing and regulation for the cannabis industry. Rules for the new market would need to be implemented by January 2022. Small businesses and existing medical marijuana companies could begin selling products that same month, with other businesses set to open in September 2022.
The bill would allow adults to possess “at least” two ounces of cannabis (regulators could set limits beyond that) and grow up to six mature and six immature plants for personal use.
Senate Tax, Business & Transportation Committee now taking public comment on the four cannabis measures being presented today. This meeting will provide an opportunity for public comment and committee discussion only. #nmleg #nmpol
— NM Senate Democrats (@NMSenateDems) February 27, 2021
Martínez said SB 363 was the most similar to the House bill of all the Senate measures, calling it “very, very aligned to what we’re doing.”
Much of Saturday’s committee hearing focused on proposed limits on business licenses and how many plants licensed producers could grow. Not only will those rules determine how easily people can enter the new market, but they’ll also likely affect available supply—a big determinant of product prices.
Both HB 12 and SB 363 would allow businesses with cultivation licenses to grow an unlimited number of plants and create a separate category of small, so-called microbusinesses that could grow a small number of plants and then process and sell marijuana products directly. Those businesses would have a lower barrier to entry in terms of licensing and fees, aimed at ensuring wider access to the industry.
SB 288, meanwhile, wouldn’t create separate license categories but would set a per-plant fee on licensing in an effort to allow a lower point of entry for small growers.
One important difference between HB 12 and SB 363, Candelaria pointed out to the panel, is that his Senate bill would allow standalone businesses to establish cannabis consumption areas, designated zones where marijuana could be used openly. The areas would be regulated by the same board that would oversee the commercial industry.
The House-passed bill would allow social consumption, too, but would limit consumption licenses to businesses engaged in other elements of the industry, such as retail marijuana stores.
Pirtle, the sponsor of SB 288, said his bill approaches legalization with the aim of ending underground sales, not necessarily raising revenue. “The first goal when legalizing cannabis,” he said at the beginning of his testimony, “is to put the illicit market out of business.”
While there’s some disagreement over how to model tax projections, estimates of how much revenue the market could raise range between $13 million and $25 million for the first year of legal sales and as much as $150 million by year five.
SB 288 would raise less money due to its comparatively lower taxes, which Pirtle said would help make legal sales more competitive with the illicit market. His measure would route virtually all of the money back to municipal governments where the cannabis transactions take place. “Those are the communities that are going to be impacted,” Pirtle said, “so they can add more police officers or cop cars.”
Candelaria, for his part, said taxes rates aren’t the way to ensure legal businesses are competitive with the illicit market. Ensuring adequate supply, such as through allowing unlimited cultivation under SB 363 and HB 12, would do far more to ensure legal products can compete on price.
“As the result of New Mexico’s plant cap” on existing medical marijuana businesses, he said, “one gram of medical cannabis costs approximately on average $10 in New Mexico. It costs $8.15 a gram in Arizona and $5.96 in Colorado.”
Those prices in Arizona and Colorado, he added, include tax.
The three Senate bills also differ on how they would address social equity and racial justice. While those issues were raised only in passing at Friday’s hearing, drug reform advocates have said they prefer HB 12’s equity provisions over any of the Senate bills.
“HB 12 legalizes cannabis in an equitable way that begins to repair the harms that have disproportionately impacted Hispanic/Latinx, Black, Native and Indigenous people in New Mexico,” Emily Kaltenbach, senior director of resident States and New Mexico for the Drug Policy Alliance, told Marijuana Moment after Friday’s vote in the House. “New Mexicans are absolutely ready to see marijuana legalization become a reality in the state, but they have made it clear that repairing the damage done by the drug war is non-negotiable.”
The House measure would establish a fund to reinvest in communities most impacted by the war on drugs, especially Black and brown communities, and includes provisions to automatically expunge prior convictions.
SB 363 includes expungement and release provisions that “mimic” those in HB 12, Candelaria told the committee, noting that his bill would also criminal reduce penalties for possession all controlled substances, not just marijuana. Simple possession of a controlled substance would become a misdemeanor under SB 363 rather than a fourth-degree felony.
Candelaria proposed that his bill, SB 363, be the main vehicle to reconcile with the House measure. “What I think makes the most sense,” he told the committee chairman, “is because the House bill has already gone through the process, is that…my bill is basically merged into House Bill 12. I think they are the most similar, both in values and their approach.”
He added that he and Pirtle “already have plans to have lunch on Monday,” to discuss how to incorporate SB 288.
If all goes well, lawmakers will have whittled down the number of bills by the committee’s scheduled meeting on the measures this coming Saturday.
“I think the message was pretty loud and clear to the sponsors,” Shendo, the panel’s chairman, said at the end of this weekend’s hearing. “They’ve got a lot of work ahead of them, and I hope I get invited to one of those lunches.”
Meanwhile, New Mexico Gov. Michelle Lujan Grisham (D) has repeatedly described legalization as a means to boost the economy, especially amid the coronavirus pandemic. She said during a State of the State address in January that “a crisis like the one we’ve experienced last year can be viewed as a loss or as an invitation to rethink the status quo—to be ambitious and creative and bold.”
The governor also included cannabis legalization as part of her 2021 legislative agenda and said in a recent interview that she’s “still really optimistic about cannabis” this session.
Additional pressure to end cannabis prohibition this year is coming from neighboring Arizona, where voters approved legalization in November and where sales officially launched in January. New Mexico shares another border with Colorado, one of the first states to legalize for adult use.
Cannabis is also expected to be legalized across the southern border, in Mexico, with lawmakers facing a Supreme Court mandate to end prohibition by April.
Last year in New Mexico, a Senate panel passed a bill to legalize cannabis for adult use passed one New Mexico Senate committee —a measure promptly rejected in another committee before the end of the 30-day legislative session.
In 2019, the House approved a legalization bill that included provisions to put marijuana sales mostly in state-run stores, but it died in the Senate. Later that year, Gov. Lujan Grisham created a working group to study cannabis legalization and issue recommendations.
Polling indicates that voters are ready for the policy change. A survey released in October found that a strong majority of New Mexico residents are in favor of legalization with social equity provisions in place, and about half support decriminalizing drug possession more broadly.
Last May, the governor signaled that she was considering actively campaigning against lawmakers who blocked her legalization bill in 2020. She also said that she’s open to letting voters decide on the policy change via a ballot referendum if lawmakers can’t send a legalization bill to her desk.
Photo courtesy of Kimberly Lawson
USDA Announces Hemp Policy Changes To Improve Insurance Coverage For Producers
The U.S. Department of Agriculture (USDA) on Thursday announced that it has taken steps to improve insurance policies for hemp businesses, making them more flexible in response to stakeholder feedback.
USDA’s Risk Management Agency (RMA) said it is making it so hemp producers are no longer mandated to deliver their crop “without economic value for insurability.” It further amended policy to clarify how the “amount of insurable acreage is determined if the processor contract specifies both an acreage and a production amount.”
— Risk Management Agency (@usdaRMA) December 2, 2021
“This change was made in the policy to ensure producers know how their insurable acreage is determined for those contracts,” the agency said in a press release.
RMA Administrator Marcia Bunger said that hemp is “an emerging crop, and we are working with hemp producers to provide insurance options that make sense for producers and for insurance providers.”
“RMA has worked to expand and refine our offerings to be responsive and dynamic,” she said.
The department also said it has added a requirement for producers who grow hemp directly from seeds that are planted in the ground.
“Before insurance attaches, producers must have acreage inspected and must have a minimum of 1,200 live plants per acre,” it explained. “This requirement was added to align direct-seeded hemp with the common farming practice for transplanted Cannabidiol (CBD) of transplanting at least 1,200 live plants per acre.”
The policy changes were outlined in a bulletin that was published on Tuesday. The department also released updated insurance standards and crop loss adjustments handbooks, as well as a detailed summary of the changes.
USDA has taken a number of steps to align hemp insurance policies with those of other lawful crops since the plant was federally legalized under the 2018 Farm Bill, consistently seeking out input from stakeholders as the industry matures.
Last year, for example, the department made it so hemp farmers can qualify for Multi-Peril Crop Insurance, in addition to several other coverage programs for which the crop is now eligible.
As it stands, federal hemp crop insurance programs are available in select counties in 25 states. This year alone, “hemp producers insured 12,189 acres and 59 policies to protect $10.9 million in liabilities,” USDA said.
As part of its overall outreach, the department launched a large-scale survey in August to gain insight into the hemp market that’s emerged.
After requesting permission from the White House earlier this year to conduct the survey of about 20,000 hemp farmers, the agency’s National Agricultural Statistics Service recently said that the forms are being finalized to be filled out via mail or online.
USDA is asking questions about plans for outdoor hemp production, acreage for operations, primary and secondary uses for the crop and what kinds of prices producers are able to bring in. The questionnaire lists preparations such as smokeable hemp, extracts like CBD, grain for human consumption, fiber and seeds as areas the department is interested in learning about.
Last year, USDA announced plans to distribute a separate national survey to gain insights from thousands of hemp businesses that could inform its approach to regulating the industry.
That survey is being completed in partnership with National Association of State Departments of Agriculture and the University of Kentucky. The department said it wanted to learn about “current production costs, production practices, and marketing practices” for hemp.
There’s still much to learn about the burgeoning market, even as USDA continues to approve state regulatory plans for the crop. Recently, the agency approved a hemp plan submitted by Colorado, where officials have consistently insisted that the state intends to be a leader in the space.
While USDA’s final rule for hemp took effect on March 22, the agency is evidently still interested in gathering information to further inform its regulatory approach going forward. Industry stakeholders say the release of the final rule is a positive step forward that will provide businesses with needed guidance, but they’ve also pointed to a number of policies that they hope to revise as the market matures such as USDA’s hemp testing requirements.
The federal Small Business Administration’s Office of Advocacy expressed a similar sentiment in a blog post in February, writing that it is “pleased with some of the changes that [USDA] has made to the rule, as they offer more certainty and are less burdensome to small farmers,” but “some concerns remained unaddressed in the final rule.”
USDA announced in April that it is teaming up with a chemical manufacturing company on a two-year project that could significantly expand the hemp-based cosmetics market.
Meanwhile, the U.S. Department of Energy (DOE) announced in August that it is sponsoring a project to develop hemp fiber insulation that’s designed to be better for the environment and public health than conventional preparations are.
Photo courtesy of Brendan Cleak.
GOP Congressman And AOC Team Up On Marijuana Bill To Incentivize State-Level Expungements
As congressional lawmakers work to advance federal marijuana legalization, a bipartisan duo on Thursday filed a bill that would incentivize states and local governments to expunge cannabis records in their jurisdictions.
Reps. Dave Joyce (R-OH) and Alexandria Ocasio-Cortez (D-NY) are sponsoring the legislation, titled the Harnessing Opportunities by Pursuing Expungement (HOPE) Act.
It would encourage states to provide relief to people with non-violent marijuana convictions through federal grants—the State Expungement Opportunity Grant Program, run through the Department of Justice—that would help cover the administrative costs of identifying and clearing eligible cases. The bill proposes to appropriate $2 million in funding to support the program for each fiscal year starting in 2023 and ending in 2032.
Specifically, the grants could be used by states to purchase technology used to facilitate expungements at scale, automate the relief process, fund legal clinics to help people get their records cleared and support “innovative partnerships” to provide mass relief.
“Having been both a public defender and a prosecutor, I have seen first-hand how cannabis law violations can foreclose a lifetime of opportunities ranging from employment to education to housing,” Joyce said in a press release. “The collateral damage caused by these missed opportunities is woefully underestimated and has impacted entire families, communities, and regional economies.”
Goes to show that lawmakers don’t have to agree on everything to find common ground on solutions to the challenges facing everyday Americans. https://t.co/lqWmY6uoKH
— Dave Joyce (@RepDaveJoyce) December 2, 2021
“By helping states establish and improve expungement programs for minor cannabis offenses, the HOPE Act will pave the way for expanded economic opportunities to thrive alongside effective investments to redress the consequences of the War on Drugs,” the congressman said.
Ocasio-Cortez said that “as we continue to advocate for the decriminalization and legalization of marijuana, this bipartisan bill will provide localities the resources they need to expunge drug charges that continue to hold back Americans, disproportionately people of color, from employment, housing and other opportunity.”
As we continue to advocate for the decriminalization and legalization of marijuana, this bill will provide needed resources to expunge drug charges that continue to hold back Americans – disproportionately people of color – from employment, housing and other opportunity.
— Rep. Alexandria Ocasio-Cortez (@RepAOC) December 2, 2021
Under the bill, state governors and local governments “shall submit to the attorney general an application at such time, in such manner, and containing such information as the attorney general may reasonably require” to qualify for the grants.
Further, the legislation would require the attorney general to carry out a study on the impacts of cannabis convictions on individuals, as well as the financial costs for states that incarcerate people over non-violent marijuana offenses.
Officials in jurisdictions that receive the grants would be required to “publish on a publicly accessible website information about the availability and process of expunging convictions for cannabis offenses, including information for individuals living in a different jurisdiction who were convicted of a cannabis offense in that jurisdiction.”
They would also need to “submit to the attorney general a report describing the uses of such funds, and how many convictions for cannabis offenses have been expunged using such funds.”
While the proposal wouldn’t end federal marijuana prohibition, it would help facilitate relief at the state level where most cannabis arrests take place in the U.S.
The bill also holds bipartisan appeal. It’s an important, albeit incremental, move to right the wrongs of the drug war, as progressives have been fighting for; it’s also narrowly tailored, simply giving an incentive to states to enact a reform that has majority support among the public.
“This bipartisan effort represents the growing consensus to reform marijuana policies in a manner that addresses the harms inflicted by prohibition,” NORML Political Director Justin Strekal said. “It provides cash assistance for state and localities that are wisely choosing to remove these stigmatizing records. There is no justification for continuing to prevent tens of millions of Americans from fully participating in their community and workforce simply because they bear the burden of a past marijuana conviction.”
“Ultimately, efforts to provide necessary relief to those who carry the scarlet letter of a marijuana conviction must be carried out primarily by state and local officials,” he said. “Having this federal incentive available will go a long way toward empowering local leaders and citizens to take these steps to address the past injustices brought about by the failed policy of marijuana prohibition, and will also move us closer toward embracing more reasonable cannabis policies.”
What’s more, while there’s been an open question about what President Joe Biden would do with a broad marijuana reform bill if it arrived on his desk given his ongoing opposition to adult-use legalization, he’s repeatedly said that nobody should be incarcerated over cannabis and that records should be expunged, so this proposal could potentially garner his favor.
There’s a similar provision to incentivize state-level expungements included in the Marijuana Opportunity, Reinvestment and Expungement (MORE) Act that cleared the House Judiciary Committee in September. But that legislation is far more wide-ranging in that it would federally deschedule cannabis.
Meanwhile, Senate Majority Leader Chuck Schumer (D-NY), Senate Finance Committee Chairman Ron Wyden (D-OR) and Sen. Cory Booker (D-NJ) are finalizing their own bill to federally legalize marijuana.
More recently, GOP lawmakers filed a legalization bill that is being framed as a compromise between progressive proposals and more scaled-back legislation that Republican legislators have introduced in recent sessions. It also contains expungements provisions.
Read the full text of the new marijuana expungements bill below:
DEA Again Boosts 2022 Production Goals For Psychedelics Like Psilocybin, MDMA and DMT
The Drug Enforcement Administration (DEA) has yet again increased its quota for the legal production of illegal controlled substances like psilocybin, MDMA and DMT for research purposes in 2022.
In a notice published in the Federal Register on Thursday, the agency made another quota adjustment for certain psychedelics. This has become something of a theme both for 2021 and 2022 production goals, with DEA raising the amounts in response to increased interest and demand within the scientific community.
Take psilocybin, for example. When DEA first released its 2021 quota for the psychedelic compound, it said it wanted just 30 grams for the year. Now that number has been boosted to 8,000 grams for 2022—a 26,567 percent increase.
“The [aggregate production quotas] established today reflect DEA’s estimates of the medical, scientific, research, and industrial needs of the United States for 2022, as well as lawful export requirements and establishment and maintenance of reserve stocks,” the agency said. “DEA can adjust the established APQs if these needs change.”
“For instance, if DEA receives additional research protocols from DEA-registered researchers, or additional quota applications from DEA-registered manufacturers, DEA will consider revising the APQ,” it explained. “DEA did receive additional quota applications from DEA-registered manufacturers for 5-MEO-DMT, psilocybin, and MDMA.”
DEA’s quota for MDMA more than doubled since it first proposed its 2022 target number, increasing from 3,200 grams to 8,200 grams. Going back to the agency’s initial 2021 quotas, it originally wanted just 50 grams of MDMA.
DMT is another apparent drug of interest within the research and medical communities, with DEA adjusting its 2022 quota from 250 grams to 3,000 grams. In further contrast, the agency’s first 2021 APQ called for only 50 grams of DMT.
When it comes to 5-MeO-DMT, DEA initially wanted just 35 grams for 2021, but that has now been ramped up significantly to 2,550 grams for 2022.
In the new notice, DEA also said that it received feedback from indigenous communities regarding the production of certain substances that are used ceremonially. For example, the Native American Church of North America submitted a comment concerning mescaline.
“They commented that their peyote ceremonies are contingent on the continued availability of peyote in the wild for sacramental use, and that the non-Native use of mescaline in research and clinical studies will have a direct impact upon the church’s ability to use, purchase, transport, and possess peyote pursuant to the American Indian Religious Freedom Act (AIRFA), as it will lead to commercialization and exploitation of peyote across its natural range and potential reclassification of its scheduling status,” DEA said.
The agency explained in its response that it is not proposing the manufacturing of peyote-derived mescaline, however, and instead will be relying on synthetic forms of the substance. “Thus, the 2022 APQ for mescaline does not have any material effect on the use of peyote by members of the Native American Church,” it said.
All told, the final quotas represent welcome news for researchers and advocates. It shows a willingness from the leading federal drug enforcement agency to recognize an emerging scientific field and promote studies into the substances regardless of their Schedule I status.
See the full list of DEA production quotas for certain drugs for 2021 and 2022 as proposed and revised below:
|Substance||2021 initial||2021 revised||2021 final||2022 initial||2022 final|
|All other tetrahydrocannabinol||1,000||1,000||1,000||2,000||2,000|
And meeting the 3.2 million gram production goal for marijuana for 2022 in particular could be simplified now that DEA has decided to end the current monopoly on federally authorized cannabis manufacturing that the University of Mississippi has had for half a century by approving additional growers for research.
National Institute on Drug Abuse (NIDA) Director Nora Volkow told Marijuana Moment in a recent interview that she was encouraged by DEA’s previous proposed increase in drug production quota. She also said that studies demonstrating the therapeutic benefits of psychedelics could be leading more people to experiment with substances like psilocybin.
But while the production developments are promising, advocates are still frustrated that these plants and fungi remain in the strictest drug category in the first place, especially considering the existing research that shows their medical value for certain conditions.
A federal appeals court recently dismissed a petition to require the DEA to reevaluate cannabis’s scheduling under the Controlled Substances Act. However, one judge did say in a concurring opinion that the agency may soon be forced to consider a policy change anyway based on a misinterpretation of the therapeutic value of marijuana.
Meanwhile, DEA has given hemp businesses that sell delta-8 THC products a boost, with representatives making comments recently signaling that, at the federal level at least, it’s not a controlled substance at this time.
Separately, the Washington State attorney general’s office and lawyers representing cancer patients recently urged a federal appeals panel to push for a DEA policy change to allow people in end-of-life care to access psilocybin under state and federal right-to-try laws.
Photo courtesy of Wikimedia/Mushroom Observer.