Marijuana Policy Project founder Rob Kampia is no longer employed by or serves on the board of the organization.
He is starting a new cannabis policy group called Marijuana Leadership Campaign (MLC), structured as a for-profit LLC consulting firm.
The new company “will focus almost exclusively on changing U.S. laws,” Kampia said in a relatively unusual memo shared with Marijuana Moment late Saturday night, which also says that the firm has lined up “nearly $500,000 in seed money” from “a marijuana investment firm in Los Angeles, a major marijuana dispensary in Colorado, Kampia’s wealthy friends in Texas (where he lives half-time) and a coalition of new donors in South Carolina.”
The split with MPP is occurring as greater attention is being paid to past allegations of sexual misconduct by Kampia amidst a national backlash against workplace sexual harassment and abuse.
In 2010, a lengthy Washington City Paper story reported that Kampia had sex with an intoxicated MPP employee, an incident after which a staff revolt nearly led to his ouster from the organization. He later took a leave of absence to seek therapy, telling the Washington Post that he was “hypersexualized.”
Now, Kampia’s departure from MPP comes as several sources tell Marijuana Moment that a major newspaper is working on a story about previously unreported allegations against the former executive director. It is unknown when that article will be published, but its existence has been an open secret in cannabis reform circles for weeks.
Formally leaving the organization is the second and final wave in Kampia’s diminishing role at MPP, which he co-founded in 1995.
In November, days before Thanksgiving, MPP announced that Kampia had stepped down from his role as executive director but would remain at the organization in a new capacity focused on fundraising and strategy.
The new memo, shared with Marijuana Moment just before midnight on the day before Christmas Eve, says that the first announcement “opened new business opportunities for Kampia” and that while he “initially proposed splitting his time equally between MPP and the new MLC, Kampia and his fellow MPP board members reached a second milestone by voting unanimously on Dec. 20 to end his full-time status at MPP this weekend.”
It was also revealed this week that Kampia is no longer a member of Students for Sensible Drug Policy’s Advisory Council. Kampia said in an interview with Marijuana Moment on Sunday that he remains a member of the National Cannabis Industry Association (NCIA) board of directors.
The memo appears to lay out the case that Kampia’s departure from MPP has nothing to do with any old or new allegations of sexual misconduct, and he said in the interview that conversations among the organization’s board “about me shifting into lesser roles at MPP extend all the way back into late October.”
“We didn’t even talk about the s-word at all,” he said, referring to sex. “It wasn’t even on our minds, which I think was kind of naive of us given the stuff that’s happening with all of these celebrities.”
But Kampia acknowledged in the interview that he “did know that there was a story in the works somewhere” at the time he registered the domain name www.marijuanaleadershipcampaign.com on December 5.
“I didn’t know which publication. I didn’t know any of the questions. I didn’t know the name of the reporter. I didn’t know anything,” he said. “I just knew that people were sort of talking about how there’s a story in the works.”
Kampia has been a key architect of many of the most significant marijuana policy victories over the past two decades, and has arguably been the legalization movement’s best fundraiser.
In the memo, he says that MLC “will work alongside the institutions he views as most effective in each sector” of the movement and industry. While the document names MPP, NCIA and New Federalism Fund as “leading the charge,” and says that the new company will “provide substantial funding” for Doctors for Cannabis Regulation (DFCR), the Law Enforcement Action Partnership (LEAP) and Clergy for a New Drug Policy, Kampia said in the interview that he hasn’t “cleared the fact that I want to give them money” with those groups.
LEAP and DFCR did not respond to requests for comment.
The memo says Kampia will divide his time between work on Texas, South Carolina, Michigan and congressional cannabis policy reform efforts as well as “raising money to make MDMA (known as ‘Ecstasy’) available as a prescription medicine for the treatment of PTSD and end-of-life anxiety.”
He plans to raise more than $2 million in 2018 from steering committees comprised of donors contributing at least $100,000 each.
When asked if the investors who have already committed nearly half a million dollars to the new venture are aware of the looming newspaper story on sexual misconduct allegations, Kampia said that “they know about the worst allegations that have ever been made about me, and I have no reason to believe that the [newspaper] story will be worse than that, so these guys are friends of the family and they’re not going to be surprised by anything in the [newspaper] and in fact they might be pleasantly surprised.”
Several of the projects mentioned in the MLC document are campaigns that Kampia had been raising money to support through MPP, but he rejected the idea that his outside efforts would drain the nonprofit of resources.
“Are there people that want to fund Texas where they might otherwise be nervous about writing a check to MPP, where they might have to pay for payroll for Rhode Island, Vermont and the national operation?” he asked, suggesting that his new outfit would be “value-added” rather than competition.
“One thing for sure that no one would do if not for the fact that I’m going to agitate for it, is to take out Congressman Pete Sessions,” he said, referring to the Republican House Rules Committee chairman who has consistently blocked marijuana amendments from being voted on. “Take out, meaning not to date him,” he said, but to un-elect him.
In the memo, Kampia twice offers quotes that he suggests are in jest, at least in part.
In the first instance, he jokes that working full-time for nonprofit organizations is “a good way to avoid amassing wealth,” while working on marijuana policy reform through an LLC will allow him to form business relationships with for-profit institutions.
Kampia, who owns a Washington, D.C,. row house that he has often referred to as “The Purple Mansion,” dismissed concerns that people might take offense to his quip about amassing wealth.
“It depends on what your definition of wealth is. I don’t have cash,” he said in the interview. “All my money goes into my mortgage. So you could say that I have wealth or not, depending on your perspective. I don’t mind if that offends people or not, because socialists who are averse to wealth probably already hate me.”
He also “half-jokingly” wrote that he hopes “to be standing behind President Rand Paul during his bill-signing ceremony [for ‘the ultimate bill to legalize marijuana on the federal level’] in the White House in 2022.”
“I don’t think Trump is going to survive reelection,” he said when asked what Paul’s path to the presidency in the 2020 election would be. “I would like to see [Trump] impeached…and I think Mike Pence is tainted as a result of being in bed with Trump. So I think that you are going to see a bunch of challengers… Rand Paul was obviously my favorite candidate last time around and so I’m cheering him on. I don’t have any inside knowledge, though. I haven’t talked to him personally.”
The memo mentions Kampia’s holiday vacation plans in the Caribbean and says that when he returns to the country the new organization will hold a series of leadership meetings in Austin, Dallas and Washington, D.C.
He will also write a book that “provides an insider’s look at the marijuana-legalization movement.” He told Marijuana Moment that the working title is, “How We Legalized Marijuana.”
The memo offers a very specific account of the book’s progress to date.
“I’m particularly excited about writing my book, which will be nonfiction but will oftentimes read like fiction, as my life is strewn with outrageous experiences that are sometimes relevant to readers who have an interest in politics generally and marijuana policy specifically,” Kampia wrote. “The book is already one-eighth written, and I’m planning to spend my time in the Bahamas and other sunny islands writing another three- eighths of the book. In fact, one reason I’m leaving MPP is to write this book, with an aggressive book tour planned for the fall of 2018.”
An MPP communications staffer could not be reached for comment by publication time, but a board member who did not wish to be named said, “I can confirm that we have been negotiating his permanent separation from the org for weeks and that he is no longer conducting any MPP business.”
Read Kampia’s full three-page memo on the new firm below:
Photo courtesy of ReasonTV.
IRS Official Offers Tax Advice To Marijuana Businesses And Says Feds Expect Industry To Keep Growing
The Internal Revenue Service (IRS) says it expects the marijuana industry to continue to grow, and it’s offering some tips to cannabis businesses on staying compliant with taxes while the plant remains federally prohibited.
In a blog post on Monday, IRS’s De Lon Harris said that the “evolving and complex issue my organization has been focused on is the tax implications for the rapidly growing cannabis/marijuana industry.”
“The specific rules and regulations regarding how [marijuana] is taxed at the federal level provides the IRS an opportunity to promote voluntary compliance, not only through audits, but also through outreach and education,” he said, noting the rapid expansion of state-legal cannabis markets. “And while there are 14 states that still ban cannabis use, we expect both unlicensed and licensed marijuana businesses to grow.”
“It’s tricky from a business perspective, because even though states are legalizing marijuana and treating its sale as a legal business enterprise, it’s still considered a Schedule 1 controlled substance under federal law,” Harris wrote. “That means a cannabis/marijuana business has additional considerations under the law, creating unique challenges for members of the industry.”
The official, who serves as commissioner of IRS’s Small Business/Self Employed (SB/SE) Examination division, recognized that the status quo means that marijuana businesses are forced to operate on a largely cash-only basis, and federal prohibition also means that companies in the sector are precluded to taking key tax deductions.
However, while the tax statute known as 280E means the industry is ineligible for most federal tax deductions and credits, he noted that marijuana firms “can deduct their cost of goods sold, which is basically the cost of their inventory.”
“What isn’t deductible are the normal overhead expenses, such as advertising expenses, wages and salaries, and travel expenses, to name a few,” Harris said. “I understand this nuance can be a challenge for some business owners, and I also realize small businesses don’t always have a lot of resources available to them.
The official previewed a new “Cannabis/Marijuana Initiative” the agency is launching that will provide specific job training to tax officials to effectively carry out audits within the industry, ensure that there’s consistency in the IRS’s policy for cannabis, work with stakeholders to ensure tax compliance and help to identify non-compliant businesses.
“I’m very focused on the success of this strategy because it’s very important for business owners to understand that under our nation’s tax laws, and specifically Internal Revenue Code 61, all income is taxable, even if someone is running a business that’s considered illegal under federal law,” he said. “This is a truly groundbreaking effort for our agency.”
“Our strategy is not limited to pushing information out via our website in the hope that business owners will find it. I’ve made it a priority for my SB/SE organization to engage with the cannabis/marijuana industry through speaking events and other outreach. I have done three of these types of events over the last year, and what I have heard is a genuine desire to comply with the tax laws regarding the industry. Through this extended outreach, we hope to help small business owners and others fully understand the unique tax rules before there are any compliance issues.”
“Since the unique circumstances of the cannabis industry can make tax preparation challenging, I hope that new and experienced business owners take my advice in this post and use our resources to ensure they understand their tax obligations and avoid penalties associated with non-compliance,” the blog post concludes. “We’re always here to help with tools, information and guidance.”
This is yet another signal that while marijuana remains federally illegal, agencies are increasingly recognizing that a policy shift is happening in states and may well be on the horizon at the congressional level.
As leadership in the House and Senate work to advance legislation to deschedule cannabis, lawmakers have also pushed to enact clear, statutory protections for financial institutions that work with state-legal marijuana businesses. And that would be accomplished through House-passed standalone legislation, or an amendment that was attached to a defense spending bill this week.
In the interim, 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. FinCEN released a report last week showing that there were 706 financial institutions that said they were actively serving cannabis clients as of the last quarter.
IRS separately hosted a forum last month dedicated to tax policy for marijuana businesses and cryptocurrency.
The seminar, which was presented by a representative of the National Association of Tax Professionals (NATP), examined issues such as allowable tax deductions while cannabis remains federally illegal and how different states approach taxing marijuana. It also covered issues related to paying taxes on earnings in Bitcoin and other forms of digital currency.
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.”
Harris’s predecessor at IRS SB/SE also participated in an informational webinar in December, offering candid insights on a variety of cannabis industry issues from the federal perspective.
Massachusetts Lawmakers Discuss Drug Decriminalization And Safe Injection Sites At Hearing
Massachusetts lawmakers on Monday heard testimony on separate proposals to decriminalize drug possession and establish a pilot program for safe injection facilities where people could use illicit substances in a medically supervised environment to prevent overdose deaths and facilitate treatment.
The state legislature’s Joint Committee on Mental Health, Substance Use and Recovery held a hearing on the harm reduction proposals, with experts and people personally impacted by substance misuse advocating for new approaches to drugs that destigmatize addiction and offer people resources outside of a criminal justice context.
The decriminalization bill would replace criminal penalties for the possession of any controlled substance with a civil fine of up to $50. To avoid the fine, individuals could enroll in a “needs screening to identify health and other service needs, including but not limited to services that may address any problematic substance use and mental health conditions, lack of employment, housing, or food, and any need for civil legal services.”
For the safe injection site legislation, the state would establish a 10-year pilot program where at least two facilities would “utilize harm reduction tools, including clinical monitoring of the consumption of pre-obtained controlled substances in the presence of trained staff, for the purpose of reducing the risks of disease transmission and preventing overdose deaths.”
A separate, less far-reaching bill that was added to the agenda in a late addition would direct the Department of Public Health to simply “evaluate the feasibility” of safe consumption sites and then report back to lawmakers by July 31, 2022..
The joint committee listened to academics, health professionals, lawmakers discuss the reform proposals but did not take immediate action on any of the legislation. It’s unclear when the bills will be taken up again for further consideration.
“By every metric, the war on drugs has been a catastrophic failure,” Rep. Mike Connolly (D) said. “In the United States and here in Massachusetts, the criminalization of drug possession is a major driver of mass incarceration. We know that black people have been incarcerated at a rate eight times higher than white people, and there’s no question that the criminalization of substance use issues has contributed to these terrible disparities.”
Connolly is also the sponsor of legislation that received a Joint Judiciary Committee hearing in July on studying the implications of legalizing psychedelics like psilocybin and ayahuasca.
Officials with at least one Massachusetts city, Somerville, said that there are plans in the work to launch a safe injection facility in the jurisdiction. And they want to see the statewide bill pass to provide additional protections against being federally penalized.
“State legislation, wielding its constitutionally granted powers to enact laws for public health and safety, has the ability to greatly minimize these risks through legislation authorizing a pilot of safe consumption sites,” Hannah Pappenheim, assistant city solicitor at the City of Somerville, said. “In addition, state legislation would also minimize the risk of costly—but more importantly, lengthy—litigation.”
The official noted that a separate, Pennsylvania-based case on the legality of safe injection sites has been ongoing in federal courts for years at this point.
A coalition of 80 current and former prosecutors and law enforcement officials—including one who is President Joe Biden’s pick for U.S. attorney of Massachusetts—recently filed a brief urging the Supreme Court to take up the case.
Xavier Bacerra, the Biden administration’s secretary of health and human services, was among eight top state law enforcement officials who filed an earlier amicus brief in support of the Philadelphia-based Safehouse’s safe injection site plan when he served as California’s attorney general.
“State legislation paves the way for a more expedient process in Somerville, and of course elsewhere in the Commonwealth,” Pappenheim said.
Somerville Mayor Joseph Curtatone (D) said at Monday’s hearing that “it’s important for Massachusetts to finally lead—not just compiling, but implementing a strategy that reduces harm and save lives.” He conceded that he previously opposed the concept of allowing safe consumption sites; but his personal experience knowing people in his immediate family who suffered from addiction—as well as his own review of the scientific literature on harm reduction alternatives to criminalization—led him to embrace the reforms.
Massachusetts lawmakers advanced similar legislation last year, but it was not ultimately enacted.
The governor of neighboring Rhode Island signed a bill in July to establish a safe consumption site pilot program where people could test and use currently illicit drugs in a medically supervised environment. It became the first state in the country to legalize the harm reduction centers. It’s not clear whether the Department of Justice will seek to intervene to prevent the opening of such facilities in that state.
Oamshri Amarasingham, deputy legislative director of the ACLU of Massachusetts, voiced support for both reform proposals at Monday’s hearing and told WGBH that establishing a safe injection site pilot program “is one piece of that puzzle” that is “critically important and that’s had great success in other countries.”
The ACLU has long supported shifting to a #PublicHealth approach to drug policy rather than a criminal one…
— ACLU Massachusetts (@ACLU_Mass) September 27, 2021
Shaleen Title, a former Massachusetts cannabis commissioner who now heads the Parabola Center, juxtaposed how laws handle substances like caffeine, alcohol and nicotine differently from currently illegal drugs.
“What separates that from when we have these illicit drugs, where handcuffs and cages are involved, and what led that to be? The reason has nothing to do with science, or evidence or the relative dangers of those drugs,” she said. “The reason is because—and this is well-documented—those drugs could be scapegoated and blamed on their association with indigenous and Indian and Mexican and Chinese and other cultures, and then used to target communities of color, particularly black and Latino people nationally and here in Massachusetts.”
At the same time that Massachusetts legislators are looking into harm reduction and broad drug decriminalization, local activists in the state have also been pursuing psychedelics reform.
Three Massachusetts cities—Northampton, Somerville and Cambridge—have each passed resolutions to deprioritize enforcement of laws against the possession, use and distribution of a wide range of psychedelics and other drugs. The Easthampton City Council is also exploring a resolution to decriminalize a wide range of entheogenic substances, with a meeting set for Friday.
Marijuana Arrests Dropped Sharply In 2020 As Both COVID And Legalization Spread, FBI Data Shows
Marijuana arrests declined significantly in 2020 amid the coronavirus pandemic, newly released FBI data shows.
There were 1,155,610 drug-related arrests overall last year, with cannabis sales and possession busts accounting for just over 30 percent (or 350,150) of those cases. The vast majority were for marijuana possession alone.
The agency’s data shows that there was a cannabis arrest every 90 seconds in the country in 2020, and there was a drug-related arrest every 27 seconds.
While these figures still highlight the rampant, ongoing criminalization of cannabis in states across the U.S., it’s a substantial deescalation compared to 2019, when FBI reported a total of 545,601 marijuana arrests. That amounted to a cannabis bust every 58 seconds.
Put another way, there was a 36 percent decrease in cannabis cases from 2019 to 2020. And while the federal agency doesn’t attempt to explain the statistical shift, there are a number of factors that could help explain it.
One of the more obvious societal changes during that timeframe is the COVID-19 health crisis, which involved social distancing requirements and generally discouraged people from being out in public where they might be at higher risk of being arrested for simple possession.
But advocates have also pointed out that the marijuana reform movement could be playing a role. Illinois’s adult-use cannabis law took effect at the beginning of 2020, for example. Hawaii, New Mexico and North Dakota also enacted decriminalization of marijuana possession in 2019, and Virginia followed suit the next year.
In Arizona, limited cannabis possession was legalized for adults starting on November 30, 2020 following voter approval of a reform initiative earlier that month.
“As more states move toward the sensible policy of legalizing and regulating cannabis, we are seeing a decline in the arrest of non-violent marijuana consumers nationwide,” NORML Executive Director Erik Altieri told Marijuana Moment. “The fight for legalization is a fight for justice. While these numbers represent a historic decline in arrests, even one person being put into handcuffs for the simple possession of marijuana is too many.”
Despite the decline in cannabis busts, the new data shows that American law enforcement still carried out more arrests for marijuana alone last year than for murder, rape, robbery, burglary, fraud and embezzlement combined.
It should be noted that not all local police participate in FBI’s reporting program, so these figures are not holistic and are estimates the agency makes based on those that do submit data.
The country had seen a consistent decline in cannabis arrests for roughly a decade prior to 2016, when those cases started to rise up until 2019.
Observers expect to see the downward trend in cannabis busts continue as more states move to end prohibition and law enforcement deprioritizes marijuana-relate cases. In New York, for example, police received new guidance this year stipulating that adults 21 and older can possess certain amounts of marijuana and consume it in places where tobacco use is permitted.
That directive alone seems to have led to a dramatic decrease in cannabis arrests in New York City.
Federal marijuana trafficking cases also continued to decline in 2020 as more states have moved to legalize, an analysis from the U.S. Sentencing Commission (USSC) that was released in June found.
Federal prosecutions of drug-related crimes overall increased in 2019, but cases involving marijuana dropped by more than a quarter, according to an end-of-year report released by Supreme Court Chief Justice John Roberts in December.
A study released by the Cato Institute in 2018 found that “state-level marijuana legalization has significantly undercut marijuana smuggling.”