The governors of Connecticut and Illinois both said on Wednesday that legalizing marijuana should be a part of plans to generate revenue for their cash-strapped states.
Illinois Gov. J.B. Pritzker (D), who campaigned last year on a pro-legalization platform, said that the state needed to “embrace some near term reasonable—and realistic—new revenue” in a speech detailing his budget proposal.
“Let’s begin with this: By legalizing and regulating adult-use cannabis in this legislative session, we will create jobs and bring in $170 million in licensing and other fees in this fiscal year 2020,” he said.
✅ Let’s legalize and regulate adult-use cannabis.
✅ Let’s legalize and tax sports betting.
✅ Let’s enact a tax on insurance companies to help cover the costs of the state’s Medicaid program.
— Governor JB Pritzker (@GovPritzker) February 20, 2019
While the move would bring economic benefits for the state, Pritzker added, “I have noted many times that I don’t view this issue through a purely financial lens.”
“I think we should take this action for our state because of the beneficial criminal and social justice implications and the jobs that it will create. And let’s be honest, like it or not, cannabis is readily available right now. I would rather the state tax it and regulate it than deny the reality of its use and accessibility.”
Watch Pritzker’s marijuana legalization comments at about 32:25 into the video below:
Pritzker’s budget plan would provide for the licensing of more than 2,000 cannabis cultivators, which would “accelerate more than $200 million in future cannabis tax revenue” through a licensing and tax credit system.
Overall, “it is estimated that $170 million will be realized in fiscal year 2020,” the budget proposal states. “Initial license fees would be the same price as the current medical cannabis renewal fee of $100,000. Credits against future cannabis taxes would be equal to 1/5th of 90 percent of the license fee, reducing the economic cost of the licenses to a value closer to the fees in other states.”
Last year, New Jersey Gov. Phil Murphy (D) proposed a similar budget plan that included marijuana legalization. But so far, the plan hasn’t played out, as lawmakers continue to weigh legalization legislation.
Connecticut Gov. Ned Lamont (D) also unveiled his two-year budget proposal on Wednesday and, while he isn’t counting on revenue from the possible future legalization of cannabis in his recommendations to lawmakers, he emphasized during a speech that ending prohibition could represent an additional new revenue source for the state.
Lamont, who said that cannabis reform would be one of his “priorities” after he was elected last year, argued that it is important to develop “new sources of revenue” beyond his budget proposals.
That includes “legalized recreational marijuana like our neighbors, that will be carefully regulated for a safer market, with tax,” he said during the speech.
Even though Lamont’s budget document doesn’t include legal marijuana revenue, it does call for the establishment of a state-licensed industrial hemp program. The governor proposed providing the state Department of Agriculture with $136,000 in funding to “develop and regulate a state industrial hemp program.”
“This is an economic development opportunity for agricultural producers in Connecticut, a sector that represents $4 billion in economic impact to the state each year, and employs about 22,000 people,” the proposal states. “Governor Lamont is solidifying his commitment to economic development and agriculture by investing in this new opportunity.”
Connecticut remains one of the states where legalization is most likely to pass in 2019, regardless of its exclusion from the budget plan. A House bill to tax and regulate marijuana sales that was filed last month has 40 cosponsors—more than a quarter of the chamber’s members.
Elsewhere in the U.S., Wisconsin Gov. Tony Evers (D) said this week that his budget proposal, which is set to be released later this month, will include plans to legalize medical marijuana and eliminate penalties for low-level cannabis possession, manufacturing and distribution. Individuals with prior marijuana convictions could also apply to have their records cleared under his plan.
Evers said his proposal calls for decriminalization instead of legalization because the administration is “starting with places that we feel we can win.”
In Rhode Island, Gov. Gina Raimondo (D) included legislative language to accomplish marijuana legalization in her budget proposal last month. According to the plan, legal sales will bring in about $22 million in tax revenue annually.
And New York Gov. Andrew Cuomo (D) also proposed legalization legislation in his budget plan this year.
Photo courtesy of ABC 20.
USDA Approves Hemp Plans For Texas, Nebraska And Delaware
The U.S. Department of Agriculture (USDA) announced on Monday that it has approved hemp regulatory plans for three more states and four additional Indian tribes.
This is the latest in a series of approvals that USDA has doled out since the crop and its derivatives were federally legalized under the 2018 Farm Bill. Texas, Nebraska and Delaware—in addition to the Colorado River Indian Tribes, the Fort Belknap Indian Community, the Iowa Tribe of Kansas and Nebraska and the Yurok Tribe—each had their regulatory plans cleared.
“USDA continues to receive and review hemp production plans from states and Indian tribes on an ongoing basis,” the department said in a notice. “Plans previously approved include those for the states of Louisiana, New Jersey, and Ohio, and the Flandreau Santee Sioux, Santa Rosa Cahuilla, and La Jolla Band of Luiseno Indian Tribes.”
While hemp is no longer a federally controlled substance, farmers interested in cultivating and selling the crop must live in a jurisdiction where USDA has approved a proposed regulatory scheme. The process was outlined in an interim final rule USDA published late last year. If a state or tribe does not have, or plan to propose, regulations for hemp, cultivators can apply for a USDA license instead.
“This is a victory for Texas farmers,” Texas Agriculture Commissioner Sid Miller said in a statement. “We are one step closer to giving our ag producers access to this exciting new crop opportunity.”
“We’ve got to get our rules approved and get our licensing program up and running, but the dominoes are dropping pretty quick,” he said. “We’re almost there.”
Heather Fazio, director of Texans for Responsible Marijuana Policy, told Marijuana Moment that “Texas has the potential to be the largest supplier of hemp in the U.S., providing farmers with an unprecedented opportunity.”
“With approval from the USDA and the Texas Department of Agriculture already moving forward with establishing licensing standards, it’s refreshing to see our government paving the way for legal cannabis cultivation in Texas,” Fazio said.
While lawmakers and industry stakeholders have widely celebrated USDA’s commitment to implementing hemp legalization, it has also received a significant amount of pushback over proposed rules such as THC limits and laboratory testing requirements. A public comment period for the department’s interim rule ends on Wednesday.
USDA maintains a website that tracks the status of state and tribal hemp plans.
Monday’s announcement sends another signal to the hemp industry that the federal government is committed to supporting the market and ensuring that farmers have the resources they need to see their businesses thrive since the crop was legalized.
That said, one of the most lucrative market opportunities that hemp farmers are hoping to take advantage of is the widespread interest in hemp-derived CBD products. The Food and Drug Administration (FDA) has jurisdiction over rules for marketing CBD, and the agency has made clear that the process may take several years without congressional action.
Earlier this month, a bipartisan coalition of lawmakers set out to do just that, filing a bill that would require FDA to allow CBD products to be sold as dietary supplements.
Photo courtesy of Brendan Cleak.
Mexico’s President Says A New Marijuana Panel Will Make Legalization Recommendations
The president of Mexico said on Monday that a government panel is being formed in order to make recommendations for a legal marijuana system in the country.
While he didn’t offer many details about the commission, President Andrés Manuel López Obrador said it will be focused on studying public health aspects of legalization.
“A group is going to be formed to decide what will happen about that with a public health approach. We are about to comply with the recommendation of the Supreme Court,” the president said during a press conference, according to a translation of his remarks, referencing a 2018 ruling that deemed the prohibition of cannabis for personal use unconstitutional.
Watch López Obrador’s marijuana comments, around 1:43:45 into the video below:
Asked to weigh in on the argument that regulating drugs like cannabis could combat cartels, the president said “we are analyzing this possibility” and went on to describe the state of play on legislation to legalize marijuana.
Since the court ruling, legislators have spent months discussing and drafting marijuana reform legislation to create a commercial cannabis market. Several Senate committees produced a comprehensive legalization bill last year, which advocates hoped would get a vote before the court’s October 2019 deadline to change the country’s marijuana policy, but that didn’t pan out.
The court granted lawmakers a deadline extension to end prohibition by April 30 of this year.
“We are about to fulfill this recommendation of the [Supreme Court] so that it becomes law,” he said. “We are going to process it, we are working on that—I think it will move forward. A group will be formed to decide what to do about this, basically.”
An amended reform bill, jointly submitted by the Justice and Health Committees, started circulating earlier this month. It would legalize possession of up to 28 grams, or 200 grams for those who obtain a certain license. Individuals would also be able to cultivate up to six plants.
“We have to review it well, of course, all with the public health approach, always with that approach, and taking into account the changes that are taking place,” the president said. “This is being analyzed.”
Sen. Ricardo Monreal Ávila of the ruling MORENA party stressed that the legislation isn’t final, but it’s a step in the right direction. He said he’ll be meeting with Interior Secretary Olga Sánchez Cordero and Julio Scherer, a legal advisor to the president, this week to discuss cannabis reform legislation.
Monreal, who included marijuana legalization in a list of legislative priorities this month, said he expects lawmakers to pass reform legislation ahead of the April deadline.
Advocates Push Back On Secretly Recorded Trump Claim That Marijuana Use Lowers IQ
Marijuana reform advocates are hitting back at President Trump’s suggestion that cannabis use makes people lose IQ points.
“In Colorado they have more accidents,” the president said of the first state to legalize cannabis for adult use. “It does cause an IQ problem.”
The comments were revealed over the weekend in a surreptitiously recorded video captured in April 2018 by Lev Parnas, an associate of Trump attorney Rudolph Giuliani, who is involved in the Ukraine scandal that led to the president’s impeachment.
But when it comes to cannabis’s impact on intelligence, Trump has it wrong, according to the National Institute on Drug Abuse, which determined based on longitudinal twin studies that there is not “a causal relationship between marijuana use and IQ loss.”
In interviews with Marijuana Moment on Monday, legalization advocates expressed frustration that the president perpetuated the prohibitionist talking point.
“Trump’s remarks simply reveal that he is out of touch, given that the majority of Americans support marijuana legalization for both medical and adult use,” Sheila Vakharia of the Drug Policy Alliance said. “This type of rhetoric is fear-mongering and inflammatory.”
“The evidence is clear from the dozens of states that have legalized medical and adult use—the sky isn’t falling and the kids are alright,” she said.
Erik Altieri, executive director of NORML, said that “what truly causes a decline in an individual’s intelligence is adhering to false Reefer Madness rhetoric that flies in the face of available science.”
“If President Trump truly believes that responsible marijuana use by adults leads to a loss of IQ points, we suggest he immediately consults his physician to see if he is suffering from this affliction or at the very least consults the wide body of available research that debunks this old talking point,” he told Marijuana Moment.
Listen to Trump talk about marijuana, about 45:30 into the video below:
But while the president’s IQ claim came as a disappointment, there were other aspects of the secretly recorded dinner conversation concerning that cannabis reform advocates see as positive.
For example, Trump seemed surprised to hear that state-legal marijuana businesses don’t have access to traditional financial services, which Parnas described as “the biggest problem” in the industry.
“Cannabis, look, you’re talking about marijuana, right? You can’t do banking there?” the president said, adding that the issue is “all working out. That whole thing is working out.”
“I don’t know if that’s a good thing or a bad thing,” he said.
Trump, who has previously voiced support for allowing states to set their own marijuana policies, also asked others at the dinner table whether they believe “the whole marijuana thing is a good thing” and whether the plant is “actually good for opioids.”
One person said cannabis is a “better alternative” to prescription opioids, and Donald Trump Jr. noted that “alcohol does much more damage” than marijuana and that “you don’t see people beating their wives on marijuana. It’s just different.”
Morgan Fox, media relations director for the National Cannabis Industry Association, told Marijuana Moment that it’s “pretty frustrating that the president, like many others, has been misled by ‘Just Say No’ propaganda into believing the disproven idea that cannabis consumption decreases intelligence.”
“However, this clip suggests that he is in a fairly good position or at least heading towards one on the issue overall,” he said. “I think it is pretty clear that he understands that prohibition is a failure from an economic standpoint, that states should be free from federal interference, and that reform could help with the opioid epidemic.”
“His statements regarding access to banking suggest that he would be willing to sign cannabis banking reform legislation that crosses his desk. Generally, it is very heartening to see that the administration is having substantive conversations about it, and we welcome the opportunity to continue this discussion with the president to make sure he recognizes the urgency of reform and has the facts.”
Later in the recording, Parnas made the case that Trump should embrace marijuana reform ahead of the 2018 midterm elections to attract young voters and get “ahead of” the issue.
“It’s so far out you’re not going to stop it,” he said. “I think you need to be ahead of it.”
Parnas pitched the idea of establishing a “bipartisan committee” with “no politicians” to independently explore possible policy changes and make recommendations to the administration. The president didn’t directly reply.
While Trump didn’t take up the suggestion to take the lead on cannabis prior to the 2018 election in which Republicans lost control of the House of Representatives, Don Murphy, director of federal policies at the Marijuana Policy Project, said it’s not too late for him to act.
The president “has an opportunity to make the history books undoing a war he inherited, waged against Americans—African Americans in particular—literally for generations,” he said.
“Even his predecessor continued that same failed policy, throwing even more people in prison. Not only that, he has a chance to out flank every Democratic candidate in the field,” Murphy told Marijuana Moment, referring to the Obama administration’s rejection of petitions to reclassify cannabis under federal law. “He would be remembered as our greatest criminal justice reformer in history.”
Photo courtesy of Wikimedia.