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New Mexico Marijuana Legalization Bill Heads To Governor’s Desk Following House And Senate Votes

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New Mexico lawmakers approved a bill to legalize marijuana for adults during a special legislative session on Wednesday, sending the years-in-the-making legislation to the desk of Gov. Michelle Lujan Grisham (D), who is expected to sign it into law. Lawmakers also passed separate legislation to expunge past convictions for low-level cannabis crimes.

Legal retail sales of cannabis are scheduled to begin by April 1, 2022.

“This is a significant victory for New Mexico,” Lujan Grisham said after the vote. “Workers will benefit from the opportunity to build careers in this new economy. Entrepreneurs will benefit from the opportunity to create lucrative new enterprises. The state and local governments will benefit from the additional revenue. Consumers will benefit from the standardization and regulation that comes with a bona fide industry.”

“And those who have been harmed by this country’s failed war on drugs, disproportionately communities of color, will benefit from our state’s smart, fair and equitable new approach to past low-level convictions,” she said.

The legalization bill, HB 2, passed the full Senate on a 22–15 vote Wednesday night following hours of contentious discussion throughout the day. It then returned to the House, which had approved it 38–32 earlier in the day, for consideration of Senate changes. That vote passed by a voice vote.

The expungements bill, SB 2, passed both chambers in identical form earlier in the day.

Provisions in the two bills were originally part of a single piece of legislation, HB 12, that passed the House during the regular session but stalled on the Senate floor. Going into this week’s special session, backers spun off the criminal justice matters in an effort to win support from Republicans and moderate Democrats who complained the proposal as a whole was too broad.

Before the full Senate vote, the body’s Committee of the Whole, consisting of all the chamber’s members, narrowly approved HB 2, voting 23–19. Lawmakers also considered a competing legalization proposal, SB 3, from Sen. Cliff Pirtle (R), who began circulating draft legislation last week. The Republican lawmaker’s bill took a simpler approach to legalization than HB 2, with lower taxes and a more streamlined licensing system.

The Committee of the Whole voted 36–6 not to advance the measure. Pirtle repeatedly complained that he had been cut out of the negotiation process dominated by members of the opposite party.

Gov. Michelle Lujan Grisham called this week’s special session primarily to push legalization across the finish line.

Here are some of the main provisions in the new legalization bill, HB 2,  as amended:

— Adults 21 and older could purchase and possess up to two ounces of cannabis, 16 grams of cannabis concentrates and 800 milligrams of infused edibles. All products would be tested by licensed laboratories for contamination and potency.

— Home cultivation of up to six mature cannabis plants would be allowed for personal use, provided the plants are out of public sight and secured from children. Households would be limited to 12 total plants. Marijuana grown at home could not be sold or bartered.

— Legal retail sales wouldn’t begin for another year or so, with a target date of April 1, 2022 or earlier. Final license rules would be due from the state by January 1, 2022, with licenses themselves issued no later than April 1.

— Advertising cannabis to people under 21 would be prohibited, with the use of cartoon characters or other imagery likely to appeal to children forbidden. Advertisements would also be barred from billboards or other public media within 300 feet of a school, daycare center or church. All products would need to carry a state-approved warning label.

— There is no limit on the number of business licensees that could be granted under the program, or the number of facilities a licensee could open, although regulators could stop issuing new licenses if an advisory committee determines that “market equilibrium is deficient.”

— Small cannabis microbusinesses, which could grow up to 200 plants, would be able to grow, process and sell cannabis products all under a single license. The bill’s backers have said the separate license type will allow wider access to the new industry for entrepreneurs without access to significant capital.

— Cannabis purchases will include a 12 percent excise tax on top of the state’s regular 8 percent sales tax. Beginning in 2025, the excise rate would climb by 1 percent each year until it reached 18 percent in 2030. Medical marijuana products, available only to patients and caretakers, would be exempt from the tax.

— In an effort to ensure medical patients can still access medicine after the adult-use market opens, the bill allows the state to force licensed cannabis producers to reserve up to 10 percent of their products for patients in the event of a shortage or grow more plants to be used in medical products.

— Local governments could not ban cannabis businesses entirely, as some other states have allowed. Municipalities could, however, use their local zoning authority to limit the number of retailers or their distance from schools, daycares or other cannabis businesses.

— Tribal governments could participate in the state’s legal cannabis industry under legal agreements contemplated under the bill.

— With certain social justice provisions expected to be repackaged into a separate bill, the legalization measure retains only some of HB 12’s original equity language, primarily focused on enacting procedures meant to encourage communities that have been disproportionately impacted by the war on drugs to participate in the new industry.

— The new industry would be overseen by a newly created Cannabis Control Division, part of the state Regulation and Licensing Department. Medical marijuana would also be regulated by that division, although the Department of Health would control the patient registry.

— By September of this year, the state would establish a cannabis regulatory advisory committee to advise the Cannabis Control Division. The committee would need to include various experts and stakeholders, such as the chief public defender, local law enforcement, a cannabis policy advocate, an organized labor representative, a medical cannabis patient, a tribal nation or pueblo, various scientists, an expert in cannabis regulation, an environmental expert, a water expert and a cannabis industry professional, among others.

— The bill as amended now includes language that would allow medical marijuana patients who are registered in other states to participates in in other states to access, a proposal that failed to pass during the regular session.

A separate spending bill introduced for the special session, HB 1, includes funding to establish and oversee the state’s legal cannabis industry. That measure has passed both chambers.

Another bill, HB 4, would have tightened laws on cannabis and driving by establishing a per se THC blood limit for DUIs, as some other states have put in place. But the House Rules and Order of Business Committee voted 8–7 that the legislation was “not germane” to the special session.

Lawmakers spent hours on the House floor Wednesday rehashing many of the same issues that have been discussed for years around legalization. Advocates stressed that the change would ensure product testing and safety, set limits to discourage youth use of cannabis and bring millions of dollars in tax revenue to the state government.

Opponents, meanwhile, warned that legalization could influence more youth to consume cannabis and lead to an uptick in impaired drivers on New Mexico’s roadways. The bill’s supporters countered that many of those risks would be better addressed through legalization than criminalization, because products would be tested, sales would be limited to adults only and law enforcement would be trained to better recognize impairment and impaired driving.

“Cannabis is already here,” one of the bill’s cosponsors, Rep. Javier MartĂ­nez (D) said. “If this bill becomes the law of the land…we can ensure that we develop the mechanisms that prevent [youth] access to cannabis.” He noted that he himself is a father of two kids, saying, “I don’t want my children to consume any type of substance that will be harmful for them.”

“I think we have a good bill and a good framework and the ability to closely regulate,” Rep. Deborah Armstrong (D) told the Senate Committee of the Whole, “and in that process, as we discover things or need to change things, we can we can do that.”

MartĂ­nez drew attention to an October poll indicating that a strong majority of New Mexico voters are ready for the policy change. Some Republicans, however, said the poll results didn’t represent their districts.

Rep. Stefani Lord (R) voiced worries that people who use cannabis would not be allowed to own a gun. In addition to cannabis still being illegal at the federal level, a state law currently bars people from “carrying a gun while under the influence of an intoxicant or narcotic.”

“You have to make a decision,” Lord said: “Am I going to smoke pot, or am I going to lose my Second Amendment rights?”

The House adopted a pair of amendments to HB 2 before ending debate earlier on Wednesday, one that would add a municipal police chief to the state’s cannabis advisory committee, and another that would require government reports to study the law’s impact.

Another floor amendment, brought by Rep. Bill Rehm (R), would have established a $100-per-ounce fine for possessing products not obtained in compliance with adult-use or medical marijuana laws, but the House tabled that proposal, effectively rejecting it.

Rehm attempted and failed to add the same amendment just hours earlier, at the late-night hearing of the House Judiciary Committee.

Another amendment offered by Rehm was also tabled by the Democrat-controlled House. It would have made it a felony to intentionally distribute cannabis to minors.

During the Senate Committee of the Whole consideration, lawmakers approved an amendment that would prevent members of the House or Senate from obtaining a cannabis business license before July 2026.

Sen. Mark Moores (R) asked during the whether the bill’s supporters had financial interests in legalization. Both Martínez and Armstrong, the two House cosponsors who were present at the hearing, said they did not, nor did they have any plans to enter the cannabis industry in the future.

Duhigg, a legalization supporter on the Senate side who voted against the amendment, said she did not have any interest in the industry. She added, “I look forward to Sen. Moore also asking the same question of Sen. Pirtle when we are hearing Senate Bill 3.”

Pirtle said he was offended by Duhigg’s insinuation of wrongdoing. “I have consistently recused myself when there has been a direct conflict or chance of impropriety,” he replied. “I voted yes [on the amendment] because I have never supported a piece of legislation that would affect me financially in my career.”

The panel adopted the change over the objections of some members who said the rule sets a bad precedent given that New Mexico lawmakers are unpaid, volunteer legislators who generally hold other jobs.

The expungements bill, SB 2, saw several relatively minor amendments in the Senate Judiciary Committee on Tuesday, most of which were technical changes to language that critics called unclear or unnecessary.

The measure would automatically erase past records of arrests or convictions for activity that would no longer be outlawed under legalization. People currently in custody for cannabis crimes would also be eligible for resentencing under the bill.

Among the more significant changes adopted in committee were a provision allowing people to petition for expungement anonymously, intended to avoid publicizing the charges being expunged. Another amendment adds human trafficking to a list of offenses that could allow state agencies to disqualify applicants for public employment or licensing.

Legislative leaders worked to hammer out a legalization deal throughout the state’s 60-day legislative session this year. Sponsors of at least five different original bills have tried to unify the conflicting proposals and incorporate feedback from colleagues. Going into the special session, HB 2’s sponsors have been working closely with the governor’s office to craft a final bill.

During the Senate Committee of the Whole hearing, Pirtle made a final plea to colleagues to consider his alternative legalization bill, which he said was similar to a 2019 proposal that passed the House but failed in the Senate, legislation he noted had bipartisan support.

“It was something that was put together with two goals in mind,” he told the committee of SB 3, “and those goals were to basically eliminate the illicit market along with protecting the public safety of the state to the best that we could.”

Pirtle said HB 2 concentrates too much power in the state Regulation and Licensing Department (RLD). His bill would have split oversight among three departments: RLD would oversee licensing, while production would be under the Department of Agriculture and “all things that would be consumed” would be regulated by the Environment Department, much like how the state regulates hemp. Licensing would also be simpler than HB 2, with lower costs and a scalable cultivation license that would be based on how many plants a business grows.

House Republicans have repeatedly blasted Democrats who wrote HB 12 for not being more transparent in the process, while others have criticized the special session as unnecessary.

“The past sixty days have been defined by the Governor and Democrats silencing the voice of the people, and the silence has become deafening following the crash and burn of their pot bill” during the regular session, House Republican Leader Jim Townsend said in a statement Monday. “If legalizing marijuana is truly about the people, you would think that New Mexicans from all walks of life would have the opportunity to contribute to the process, especially when it failed so miserable at the last minute due to too many cooks in the kitchen.”

Gov. Lujan Grisham, meanwhile, included cannabis legalization as part of her 2021 legislative agenda and has repeatedly talked about the need to legalize 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.”

Additional pressure to end cannabis prohibition this year is coming from neighboring Arizona, where sales officially launched in January after voters approved a legalization ballot initiative last year. To New Mexico’s north is 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 the end of April.

Before last year’s failed effort, New Mexico’s House in 2019 approved a legalization bill that included provisions to put marijuana sales mostly in state-run stores, but that measure died in the Senate. Later that year, Lujan Grisham created a working group to study cannabis legalization and issue recommendations.

In May of last year, the governor signaled 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.

New York Governor Signs Marijuana Legalization Bill, Hours After Lawmakers Put It On His Desk

Marijuana Moment is made possible with support from readers. If you rely on our cannabis advocacy journalism to stay informed, please consider a monthly Patreon pledge.

Ben Adlin is a Seattle-based writer and editor. He has covered cannabis as a journalist since 2011, most recently as a senior news editor for Leafly.

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Top IRS Official Says Marijuana Banking Reform Would Help Feds ‘Get Paid’

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The Internal Revenue Service (IRS) would like to get paid—and it’d help if the marijuana industry had access to banks like companies in other legal markets, an official with the federal department said. She also talked about unique issues related to federal tax deductions for cannabis businesses.

At an event hosted by UCLA’s Annual Tax Controversy Institute on Thursday, IRS’s Cassidy Collins talked about the “special type of collection challenge” that the agency faces when it comes to working with cannabis businesses while the product remains federally illegal.

While IRS isn’t taking a stand on federal marijuana policy, Collins said that the status quo leaves many cannabis businesses operating on a cash-only basis, creating complications for the agency, in part by making it harder for banks to “pay us.”

“The reason why [the marijuana industry is] cash intensive is twofold,” she said. “Number one, a lot of customers don’t want a paper trail showing that they’re buying marijuana, and number two, the hesitancy of banks to allow marijuana businesses to even bank with them.”

Of course, the reason why many financial institutions remain hesitant to take on cannabis companies as clients is because the plant is a strictly controlled substance under federal law.

“There’s been a number of legislative bills that have been introduced—and I am definitely not expressing any opinion personally or on behalf of the IRS about any pending or proposed legislation,” Collins, who is a senior counsel in the IRS Office of Chief Counsel, said. “But it is interesting to note that, if the law changed so that the marijuana businesses could have banks, that would make the IRS’s job to collect [taxes] a lot easier. As part of collection, we want the money. That’s our end goal there.”

A major part of what makes cannabis businesses unique is that they don’t qualify for traditional tax credits under an IRS code known as 280E. That policy “prohibits them from claiming deductions for business expenses because they’re technically being involved in drug trafficking,” Collins explained at the event, from which small excerpts of her comments were reported by Bloomberg.

There are some options available to lessen the burden on marijuana firms, however. At the end of the day, “IRS will work with marijuana companies because, again, we want to get paid,” Collins said.

One of the ways the agency works with marijuana business operators is to have them visit designated IRS “tax assistance centers” that accept cash payments in excess of $50,000. But the official warned businesses to “be prepared to be there for a little while” as the center checks—and double checks—the amount of cash being submitted.

“Revenue officers will assist the marijuana companies in paying us,” she said.

IRS officials could also help cannabis firms by having officials accompany them “to the bank in order to try to help the taxpayer secure a cashier’s payment to pay the IRS, as well as using money orders,” she said, adding that “our revenue officers are are wanting to work with the marijuana companies to help assist them to pay us.”

“When the revenue officers are there in person with the taxpayer, that could potentially help increase the likelihood that the bank will cooperate and help the taxpayer transition into a cashier’s check,” she continued. “And that has been a trend since this first became legal [at the state level], that more and more banks are allowing cannabis companies to bank with them.”

In a report published earlier this year, congressional researchers examined tax policies and restrictions for the marijuana industry—and how those could change if any number of federal reform bills are enacted.

IRS, for its part, said last month that it expects the cannabis market to continue to grow, and it offered some tips to businesses on staying compliant with taxes while the plant remains federally prohibited.

As it stands, banks and credit unions are operating under 2014 guidance from the Financial Crimes Enforcement Network (FinCEN) that lays out reporting requirements for those that choose to service the marijuana industry.

Leaders in both chambers of Congress are working on legalization bills to end federal marijuana prohibition. But stakeholders are hopeful that, in the interim, legislators will enact modest marijuana banking reform. Legislation to protect financial institutions from being penalized for working with cannabis businesses passed the House for the fifth time last month.

Rodney Hood, a board member of the National Credit Union Administration, wrote in a Marijuana Moment op-ed this month that legalization is an inevitability—and it makes the most sense for government agencies to get ahead of the policy change to resolve banking complications.

IRS separately hosted a forum in August dedicated to tax policy for marijuana businesses and cryptocurrency.

Earlier this year, IRS Commissioner Charles Rettig told Congress that the agency would “prefer” for state-legal marijuana businesses to be able to pay taxes electronically, as the current largely cash-based system under federal cannabis prohibition is onerous and presents risks to workers.

Former Treasury Secretary Steven Mnuchin said in 2019 that he’d like to see Congress approve legislation resolving the cannabis banking issue and he pointed to the fact that IRS has had to build “cash rooms” to deposit taxes from those businesses as an example of the problem.

IRS released updated guidance on tax policy for the marijuana industry last year, including instructions on how cannabis businesses that don’t have access to bank accounts can pay their tax bills using large amounts of cash.

The update appears to be responsive to a Treasury Department internal watchdog report that was released earlier in the year. The department’s inspector general for tax administration had criticized IRS for failing to adequately advise taxpayers in the marijuana industry about compliance with federal tax laws. And it directed the agency to “develop and publicize guidance specific to the marijuana industry.”

Luxembourg Set To Become First European Country To Legalize Marijuana Following Government Recommendation

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Luxembourg Set To Become First European Country To Legalize Marijuana Following Government Recommendation

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Luxembourg is poised to become the first European country to legalize marijuana, with key government agencies putting forward a plan to allow the possession and cultivation of cannabis for personal use.

The ministers of justice and homeland security on Friday unveiled the proposal, which will still require a vote in the Parliament but is expected to pass. It’s part of a broader package of reform measures the agencies are recommending.

Under the marijuana measure, adults 18 and older could grow up to four plants. However, under the non-commercial model that is being proposed, possessing more than three grams in public would still be a civil offense, carrying a fine of €25-500 ($29-581). Currently, the maximum fine for possession is €2,500 ($2,908).

In terms of access, adults would be able to buy and trade cannabis seeds for their home garden.

Justice Minister Sam Tamson said the government felt it “had to act” and characterized the home cultivation policy change as a first step, The Guardian reported.

“The idea is that a consumer is not in an illegal situation if he consumes cannabis and that we don’t support the whole illegal chain from production to transportation to selling where there is a lot of misery attached,” he said. “We want to do everything we can to get more and more away from the illegal black market.”

While limited in scope, the reform would make Luxembourg the first country in Europe to legalize the production and possession of marijuana for recreational use. Cannabis has been widely decriminalized in certain countries in the continent, but it has remained criminalized by statute.

Government sources in Luxembourg told The Guardian that plans are in the works to develop a program where the state regulates the production and distribution of marijuana. Tamson said they are working to resolve “international constraints” before taking that step, however, referring to United Nations treaty obligations that multiple U.S. states and other countries like Canada and Uruguay have openly flouted.

For now, the country is focusing on legalization within a home setting. Parliament is expected to vote on the proposal in early 2022, and the ruling parties are friendly to the reform.

This has been a long time coming, as a coalition of major parties of Luxembourg agreed in 2018 to enact legislation allowing “the exemption from punishment or even legalization” of cannabis.

Meanwhile in the U.S., congressional lawmakers are working to advance legalization legislation. A key House committee recently approved a bill to end marijuana prohibition, and Senate leadership is finalizing a separate reform proposal.

In Mexico, a top Senator said this week that lawmakers could advance legislation to regulate marijuana in the coming weeks. The Supreme Court has already ruled that adults cannot be criminalized over possession or cultivation, but there’s currently no program in place to provide access.

New Bipartisan Marijuana Research Bill In Congress Would Let Scientists Study Dispensary Products

Photo courtesy of Mike Latimer.

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New Bipartisan Marijuana Research Bill In Congress Would Let Scientists Study Dispensary Products

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A bipartisan group of federal lawmakers introduced a bill on Thursday to remove barriers to conducting research on marijuana, including by allowing scientists to access cannabis from state-legal dispensaries.

The Medical Marijuana Research Act, filed by the unlikely duo of pro-legalization Rep. Earl Blumenauer (D-OR) and prohibitionist Rep. Andy Harris (R-MD), would streamline the process for researchers to apply and get approved to study cannabis and set clear deadlines on federal agencies to act on their applications.

“Congress is hopelessly behind the American people on cannabis, and the quality of our research shows why that is an urgent problem,” Blumenauer told Marijuana Moment. “Despite the fact that 99 percent of Americans live in a state that has legalized some form of cannabis, federal law is still hamstringing researchers’ ability to study the full range of health benefits offered by cannabis, and to learn more about the products readily available to consumers.”

“It’s outrageous that we are outsourcing leadership in that research to Israel, the United Kingdom, Canada, and others. It’s time to change the system,” he said.

Late last year, the House approved an identical version of the cannabis science legislation. Days later, the Senate passed a similar bill but nothing ended up getting to the president’s desk by the end of the last Congress. Earlier this year, a bipartisan group of senators refiled their marijuana research measure for the current 117th Congress.

Meanwhile, lawmakers are also advancing a separate strategy to open up dispensary cannabis to researchers. Large-scale infrastructure legislation that has passed both chambers in differing forms and which is pending final action contains provisions aimed at allowing researchers to study the actual marijuana that consumers are purchasing from state-legal businesses instead of having to use only government-grown cannabis.

The new bill filed this week by Blumenauer and Harris, along with six other original cosponsors, would also make it easier for scientists to modify their research protocols without having to seek federal approval.


Marijuana Moment is already tracking more than 1,200 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.

Learn more about our marijuana bill tracker and become a supporter on Patreon to get access.

It would additionally mandate that the Drug Enforcement Administration (DEA) license more growers and make it so there would be no limit on the number of additional entities that can be registered to cultivate marijuana for research purposes. It would also require the U.S. Department of Health and Human Services (HHS) to submit a report to Congress within five years after enactment to overview the results of federal cannabis studies and recommend whether they warrant marijuana’s rescheduling under federal law.

“The cannabis laws in this country are broken, including our laws that govern cannabis research,” Blumenauer said in remarks in the Congressional Record. “Because cannabis is a Schedule I substance, researchers must jump through hoops and comply with onerous requirements just to do basic research on the medical potential of the plant.”

The new legislation will “both streamline the often-duplicative licensure process for researchers seeking to conduct cannabis research and facilitate access to an increased supply of higher quality medical grade cannabis for research purposes,” he said, adding that expanded studies will help make sure “Americans have adequate access to potentially transformative medicines and treatments.”

For half a century, researchers have only been able to study marijuana grown at a single federally approved facility at the University of Mississippi, but they have complained that it is difficult to obtain the product and that it is of low quality. Indeed, one study showed that the government cannabis is more similar to hemp than to the marijuana that consumers actually use in the real world.

There’s been bipartisan agreement that DEA has inhibited cannabis research by being slow to follow through on approving additional marijuana manufacturers beyond the Mississippi operation, despite earlier pledges to do so.

In May, the agency finally said it was ready to begin licensing new cannabis cultivators. Last week, DEA proposed a large increase in the amount of marijuana—and psychedelics such as psilocybin, LSD, MDMA and mescaline—that it wants produced in the U.S. for research purposes next year.

Under the new House bill, the agency would be forced to start approving additional cultivation applications for study purposes within one year of the legislation’s enactment.

HHS and the attorney general would be required under the bill to create a process for marijuana manufacturers and distributors to supply researchers with cannabis from dispensaries. They would have one year after enactment to develop that procedure, and would have to start meeting to work on it within 60 days of the bill’s passage.

In general, the legislation would also establish a simplified registration process for researchers interested in studying cannabis, in part by reducing approval wait times, minimizing costly security requirements and eliminating additional layers of protocol review.

Read the full text of the new marijuana research bill below:

Click to access medical-marijuana-research-act-hr-5657-text.pdf

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