New Zealand could be the first country in the world to legalize marijuana by a nationwide voter referendum.
That’s the result of a new minority coalition government agreement announced on Thursday.
As a condition of helping to install Labour Party head Jacinda Ardern as the country’s next prime minster and pass some of her legislation, the Green Party extracted a promise from the incoming government to let New Zealand voters decide whether to legalize cannabis at the ballot box by 2020.
A Global First
Uruguay has already legalized marijuana, and Canada’s government is working to end prohibition by next summer. In both of those nations, however, the cannabis changes are a result of acts of elected officials.
In the U.S., voters in a growing number of states have enacted legalization ballot measures, but the country has no national voter initiative or referendum process.
That means New Zealand voters could be the first in the world to legalize cannabis throughout an entire country at the ballot box. (In 2008, voters in Switzerland strongly rejected a marijuana legalization referendum.)
That is, if the new government stays in power and upholds the “confidence and supply” deal it made with the Greens.
New Zealand’s Incoming Prime Minister On Marijuana
Labour’s 37-year-old Ardern personally supports medical cannabis and says that she doesn’t “think people should be locked in prison” for marijuana but that achieving that outcome doesn’t necessarily “require decriminalisation.”
Now, as part of her new coalition government’s deal, New Zealanders will have a chance to push even further by voting in favor of legalizing cannabis.
In a press conference after the new governing deal was announced, Ardern said she would be “seeking advice” as to the exact timing of the marijuana referendum.
It is also not clear whether it will be strictly binding or simply an advisory measure, though the new leader indicated she’s leaning toward giving voters the power to directly legalize cannabis themselves.
“That might be a conversation we have as an executive,” she said. “I think if you go to the New Zealand public on an issue like that and it’s confidence vote, then we really should place some weight on the public of New Zealand’s view.”
As to her own views on cannabis, Ardern said that the country’s current policy, which is “a justice-based approach to cannabis in this country, isn’t working. We can do better.”
But the incoming prime minister also has “concerns about young people accessing a product which can clearly do harm and damage to them.”
Broader Drug Reforms In Play
In addition to the marijuana referendum pledge, the Greens were able to get Labour to agree to broader, if vaguely articulated, drug policy reforms. According to an email sent to party supporters, the deal would:
“Increase funding for alcohol and drug addiction services and ensure drug use is treated as a health issue, and have a referendum on legalising the personal use of cannabis at, or by, the 2020 general election.”
The Greens also extracted concessions on climate policy and education, and will also have ministerial posts as part of the agreement with Labour.
Government Shutdown Would Let Sessions Attack Medical Marijuana
The federal government will shut down at midnight on Friday, barring an unexpected, last-minute bipartisan deal. That puts medical marijuana patients and providers at risk of being arrested, prosecuted and sent to prison by Jeff Sessions’s Justice Department.
Under a shutdown scenario, an existing budget provision that prevents the Drug Enforcement Administration (DEA) and other agencies from spending money to interfere with state medical cannabis laws would expire. But federal drug enforcement and prosecution actions, which are exempted from furloughs, would continue.
Why Might The Government Shut Down?
A bill to extend federal funding levels and policy riders like the marijuana one through February 16 was approved by the House on Thursday. But a heated dispute over immigration issues has jeopardized its passage in the Senate, where a significant number of Democrats are refusing to support any bill that does not provide protections to people who were brought to the U.S. as children.
Earlier this month, Attorney General Sessions rescinded Obama-era guidance that has generally allowed states to implement their own cannabis laws without federal intervention. That has left recreational marijuana businesses and consumers without a key protection they’ve relied on since 2013, but the ongoing existence of the medical cannabis spending rider has continued to keep patients and providers safeguarded from federal attacks.
An unintended consequence of Senate Democrats’ move to block the funding extension bill and shut down the government over immigration issues is that medical marijuana patients and industry operators would be at much greater risk, as soon as this weekend.
Why Would Drug Enforcement Continue Under A Shutdown?
“All agents in DEA field organizations are excepted from furlough because they support active counternarcotics investigations. This encompasses 21 domestic divisions, 7 regional foreign divisions, critical tactical support groups including the El Paso Intelligence Center and the Special Operations Division, forensic sciences, and technical surveillance support,” a Justice Department shutdown contingency plan says. “DEA investigations need to continue uninterrupted so that cases are not compromised and the health and safety of the American public is not placed at risk.”
The same goes for federal prosecutors.
“As Presidential Appointees, U.S. Attorneys are not subject to furlough,” the shutdown document reads. “Excepted employees are needed to address ongoing criminal matters and civil matters of urgency throughout the Nation. Criminal litigation will continue without interruption as an excepted activity to maintain the safety of human life and the protection of property.”
Politics Of Marijuana And Immigration Collide
Democrats, especially those considering 2020 presidential bids, are facing enormous pressure from their progressive base not to go along with yet another bill in a series of short-term funding extensions that do not include protections for young immigrants known as “DREAMers.” Because Republicans hold only 51 seats in the chamber, and a handful of GOP members are also opposing the spending resolution, leaders need support from Democrats to reach the critical 60-vote threshold to advance legislation.
The medical cannabis budget rider was first enacted into law in late 2014, and has since been extended for each subsequent fiscal year. Last May, Sessions sent a letter to congressional leaders asking them not to continue the medical marijuana rider into Fiscal Year 2018.
“I believe it would be unwise for Congress to restrict the discretion of the Department to fund particular prosecutions, particularly in the midst of an historic drug epidemic and potentially long-term uptick in violent crime,” he wrote. “The Department must be in a position to use all laws available to combat the transnational drug organizations and dangerous drug traffickers who threaten American lives.”
Setting aside the important question of whether the medical cannabis rider will be included in full Fiscal Year 2018 spending legislation that congressional leaders continue to negotiate — and it is a big question, since House leaders blocked lawmakers from even voting on whether to include the policy in that chamber’s version of Justice Department spending legislation — the current budget brinksmanship on Capitol Hill means the medical marijuana protections could disappear as soon as Saturday morning.
A Shutdown Allows Old Federal Marijuana Prosecutions To Resume
If the provision lapses, it wouldn’t just allow new actions against people violating federal marijuana laws. It would also allow earlier medical cannabis prosecutions that were suspended under to the rider to resume.
A federal judge in a California case last August, for example, wrote that the prosecution of two marijuana growers would be “stayed until and unless a future appropriations bill permits the government to proceed. If such a bill is enacted, the government may notify the Court and move for the stay to be lifted.”
The failure to enact a new bill continuing the protections would have the same effect under a shutdown scenario, given that enforcement of federal drug laws would still continue.
Long-Term Status Of Marijuana Protections Unclear
The Senate Appropriations Committee voted in July to include the medical cannabis rider in its version of the 2018 Justice Department funding bill. But without the provision being approved on the House side, its long-term continuance will be determined behind closed doors by a bicameral conference committee that merges the two chambers’ proposal into a single bill to be sent to President Trump.
Advocates have also pushed to expand the protection to encompass all state marijuana laws, not just those focused on medical access. A measure to do that came just nine flipped votes of passage on the House floor in 2015, and the number of states with legalization has doubled since then. However, Republican congressional leaders have blocked subsequent cannabis measures from advancing to floor consideration, including as recently as this week.
In the meantime, medical cannabis patients and providers will wait to see if Jeff Sessions and his DEA agents will regain the ability to come after them for the first time since 2014 this weekend.
California Lawmakers Pressure Sens. Harris And Feinstein On Marijuana
A group of ten U.S. House members from California are calling on the state’s two senators to do more to push back on the Trump administration’s decision to rescind protections for state marijuana laws.
“As you know, in November 2016, the people of California spoke up and voted in favor of Proposition 64, which legalized recreational cannabis… The recent action by the Attorney General put the industry in jeopardy,” the bipartisan group of ten members of Congress wrote to U.S. Sens. Kamala Harris and Dianne Feinstein, both Democrats.
“To increase pressure, we are calling on you to block nominations to the Justice Department until the Attorney General reinstates the Cole Memo,” the House lawmakers said.
While Feinstein has long been one of Congress’ most ardent opponents of marijuana legalization, Harris has in recent weeks repeatedly criticized the move by U.S. Attorney General Jeff Sessions to tear up Obama-era guidance that has generally allowed states to implement their own marijuana laws without federal interference.
But despite tweeting a lot about marijuana and starting an online petition on the issue through which her campaign apparatus is able to collect e-mail addresses, Harris hasn’t yet added her name as a cosponsor of a single one of the various cannabis reform bills her Senate colleagues have introduced.
Now, the House members, led by Reps. Lou Correa (D) and Dana Rohrabacher (R), are asking her and Feinstein to prevent Sessions from being able to confirm new U.S. attorneys or other Justice Department nominees until he reverses the anti-marijuana move.
“The legalization of cannabis will spur economic growth and provide sales tax revenues,” they write.
I’m calling on @SenFeinstein @SenKamalaHarris to block all @TheJusticeDept nominations until AGSessions reinstates the Cole Memo. #California voted to make #cannabis legal. AG Sessions’ decision ignores the will of Californians and places law-abiding citizens in jeopardy. pic.twitter.com/mPu4SRADHx
— Rep. Lou Correa (@RepLouCorrea) January 18, 2018
Within hours of Sessions’s announcement of rescinding the marijuana protections, Republican Sen. Cory Gardner of Colorado vowed to place a hold on all Justice Department nominations over the issue.
.@SenCoryGardner on Attorney General Jeff Sessions' #marijuana policy change: "I will be holding all nominations for the Department of Justice. The people of Colorado deserve answers." pic.twitter.com/BnVEkA54ag
— CSPAN (@cspan) January 4, 2018
Feds Reviewing Marijuana Banking Protections
A top official with the U.S. Treasury Department says the Trump administration is currently reviewing whether to keep or rescind Obama-era guidance that provides a process for banks to serve the marijuana industry without running afoul of federal regulators.
“We are reviewing the guidance in light of the attorney general’s recent decision to revoke a Justice Department memorandum on this issue,” Sigal Mandelker, the department’s deputy secretary, said at a Senate hearing on Wednesday.
However, she added that the Treasury guidance “remains in place,” at least for now. “We’re taking a look at it in light of the Justice Department’s announcement.”
Earlier this month, U.S. Attorney General Sessions rescinded a 2013 memo that has generally allowed states to implement their own cannabis laws without federal interference.
Mandelker was responding to questions from Sen. Bob Menendez (D-NJ) about a separate guidance memo issued by the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) in 2014 that laid out a process for how banks can open accounts for marijuana businesses and avoid triggering federal enforcement actions.
Medical marijuana dispensaries help many chronically ill NJans, including veterans, and provide a non-opioid alternative for those who badly need it. That's why I pressed Trump Admin. officials to keep in place guidance for banks who want to serve marijuana-related businesses. pic.twitter.com/notbqpFvSD
— Senator Bob Menendez (@SenatorMenendez) January 18, 2018
The policy, which requires financial institutions to regularly file reports on their cannabis customers, was intended to provide clarity and assurances to banks, but many have remained reluctant to work with marijuana businesses because of overarching federal prohibition laws.
Nonetheless, documents released by FinCEN last month showed that the number of banks willing to work with the marijuana industry has steadily grown over time, though those figures were collected prior to Sessions’s move to revoke the previous Justice Department guidance.
Reuters reported last week that FinCEN was not consulted in advance about Sessions’s decision.
On Wednesday, a bipartisan group of 31 House members sent a letter asking the agency not to rescind the cannabis banking guidance.
“FinCEN’s stated priorities have allowed such businesses to conduct commerce more safely through financial institutions which reduces the use of all cash, improves public safety, and reduces fraud,” the lawmakers wrote. “Leaving your guidance unchanged will continue to encourage small companies to make investments by freeing up access to capital. It will also further provide for well regulation and oversight through suspicious activity reports. Rescinding this guidance would inject uncertainty in the financial markets.”
A bipartisan group of 15 senators followed up with their own letter on Thursday.
.@SenJeffMerkley & I led a bipartisan effort, urging Financial Crimes Enforcement Network to keep guidelines in place enabling financial institutions to provide banking services for legitimate cannabis businesses in states that have legalized marijuana. https://t.co/N49vKZZ8f3
— Sen. Lisa Murkowski (@lisamurkowski) January 18, 2018
“Attempts to disrupt this market are dangerous and imprudent,” they wrote. “We see the removal of protections on financial institutions, which are operating in accordance with state laws, as a poor alternative to creating meaningful policy through the political process.”
In a separate letter, Menendez and Sen. Cory Booker, a fellow New Jersey Democrat, wrote that “without access to the banking sector, [marijuana] businesses will face serious challenges paying their employees, conducting transactions with vendors, and meeting state tax obligations.”
A growing bipartisan group of members of Congress has sought a legislative solution to the cannabis businesses’ banking access problems. House and Senate bills to provide permanent clarity to the banking industry about working with marijuana businesses have earned increasing cosponsor numbers, but haven’t been scheduled for hearings or votes.
In 2014, the House voted 231 to 192 in favor of an amendment to prevent federal authorities from punishing banks for servicing the legal marijuana industry. But the language was not included in the final version of annual appropriations legislation that year and was not enacted into law. Congressional Republican leaders have since prevented similar measures from even being considered for attachment to subsequent spending bills.
In November, the chair of the House Financial Services Committee used a procedural ruling to block a vote on a cannabis banking amendment offered to a bill on stress testing for financial institutions.
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