A key congressional committee released two reports on Monday that discuss policies surrounding marijuana, hemp and cannabidiol (CBD).
The documents published by the House Appropriations Committee are attached to annual spending bills that fund certain parts of the federal government, and some of their sections outline concerns about marijuana-impaired driving and the marketing of cannabis-derived products. One of the reports also lays out directives on funds to be used for the implementation of hemp regulations for the 2020 fiscal year.
The first report, which corresponds with legislation on Agriculture, Rural Development, the Food and Drug Administration (FDA) and related agencies, includes two cannabis sections.
One passage details concerns about CBD products that are currently being “marketed in violation” of federal law. At the same time, though, the committee is directing FDA to follow through with pledges to identify “lawful federal regulatory pathways for CBD foods and dietary supplements if such pathways are consistent with protection of the public health,” given that hemp-derived CBD was legalized under the 2018 Farm Bill.
“Cannabidiol Regulatory Pathway—The Committee is concerned about the proliferation of foods and dietary supplements marketed in violation of the Federal Food, Drug & Cosmetic Act (FFDCA), including products containing cannabis and cannabis-derived ingredients. Non-FFDCA-compliant products pose potential health and safety risks to consumers through unsubstantiated and misleading claims such as treating a wide-range of life-threatening diseases and conditions; excessive cannabidiol (CBD) concentrations that can result in harmful drug-drug interactions, somnolence, and elevated transaminases or liver toxicity; and the presence of significant levels of intoxicating compounds such as tetrahydrocannabinols (THC). The 2018 farm bill expressly preserves FDA’s public health authority to take appropriate actions regarding cannabis, including hemp and its derivatives. The Committee recognizes the FDA is considering a public regulatory process to evaluate the appropriateness, and possible parameters, of a regulatory pathway that would permit CBD in certain foods and dietary supplements. The Committee expects the FDA to assert its commitment to identifying lawful federal regulatory pathways for CBD foods and dietary supplements if such pathways are consistent with protection of the public health. Such pathways may include necessary public health and safety parameters that will protect the public health, such as labeling requirements and limits on CBD or other cannibis-derived ingredients in products, based upon anticipated total exposure levels. The Committee also expects the FDA to preserve the integrity of its drug development and approval processes, which ensures that products marketed for drug uses have undergone a rigorous scientific validation process demonstrating quality, safety and efficacy. It is also imperative that any FDA regulation of foods and dietary supplements containing CBD or other cannibis-derived ingredients preserve incentives to invest in robust clinical study of cannabis, so its therapeutic value can be more fully understood.”
Industry stakeholders got the chance to weigh in on the rulemaking process during a public hearing the FDA held last week.
Elsewhere in the same report, the House panel said that it was providing the U.S. Department of Agriculture (USDA) with roughly $16.5 million to facilitate the implementation of regulations for hemp and hemp-derived products “as soon as possible.”
“Hemp Production Program—The Committee understands that USDA is working on implementing the Hemp Production Program as authorized by the 2018 Farm Bill and encourages the Department to use existing resources to issue regulations as soon as possible. The bill includes $16,496,000 for implementation costs in fiscal year 2020. The Department is directed to provide the Committee with frequent status updates on the progress of implementation.”
Agriculture Secretary Sonny Perdue has pledged to release those guidelines in time for the 2020 planting season.
In a separate report on an appropriations for the Departments of Transportation, Housing and Urban Development and related agencies, the committee said that drug-impaired driving “remains a growing concern due to the increase in States legalizing marijuana use and the persistence of the opioid crisis.”
The panel urged the National Highway Traffic Safety Administration (NHTSA) to develop “a reliable standard for all types of impaired driving” but acknowledged that “developing a standard measurement of marijuana impairment, similar to blood alcohol concentration, remains unlikely in the near term.” As such, it is directing the agency to prioritize research into the creation of a standardized field sobriety test for cannabis.
The report sets aside $250,000 for NHTSA to support impaired driving detection programs for law enforcement.
“Drug-impaired driving—As drugged driving remains a growing concern due to the increase in States legalizing marijuana use and the persistence of the opioid crisis, the Committee supports the recommendations of the National Transportation Safety Board that DOT work with the Department of Health and Human Services to develop an impairment standard for drugs. The Committee urges NHTSA to coordinate research efforts with the States and other partners aimed at developing a reliable standard for all types of impaired driving, including marijuana impairment. The Committee directs NHTSA to continue its research efforts aimed at identifying and documenting drug-impaired drivers.
The Committee recognizes that developing a standard measurement of marijuana impairment, similar to blood alcohol concentration, remains unlikely in the near term and that resources are well spent on increasing law enforcement officers’ ability to detect driver impairment for multiple substances. The Committee directs NHTSA to continue to robustly support police training programs, particularly Drug Recognition Expert (DRE) and Advanced Roadside Impaired Driving Enforcement (ARIDE) training, and to prioritize the study and development of a standardized field sobriety test (SFST) to detect marijuana impairment. These programs support law enforcement identification of people who may be impaired due to marijuana or other drugs. Of the amounts provided under the description Impaired and Drug Impaired Driving as part of NHTSA’s Highway Safety Programs, the Committee provides an additional $250,000 under this heading to support DRE and ARIDE.”
The current text of the related respective bills themselves do not include any cannabis-specific language, but amendments could be added during the full House Appropriations Committee markup that is scheduled for Tuesday, or when the bills come to the full House floor. Senate-side action on marijuana riders is also possible.
One piece of appropriations legislation that does include marijuana provisions was released on Sunday. The spending proposal from the House Appropriations Subcommittee on Financial Services and General Government stipulated that funds could not be spent to penalize banks for servicing cannabis businesses that are operating in compliance with state law.
That legislation also eliminates a longstanding rider that has prohibited Washington D.C. from spending its own tax dollars to legalize and regulate marijuana sales.
Three separate spending reports that reference cannabis policy were released last month. The House Appropriations Committee said it was interested in “lowering regulatory and other barriers to conducting” research into Schedule I drugs such as cannabis. It also called for studies into the potential use of CBD and kratom as alternatives to opioid-based painkillers.
On a similar note, the panel said in a manager’s amendment to a report tied to the appropriations bill covering the Justice Department that the Drug Enforcement Administration should “expeditiously process any pending applications for authorization to produce marijuana exclusively for use in medical research.”
The committee also included language in a report attached to legislation funding the Department of Veterans Affairs expressing concern about a policy that denies home loans to military veterans who work in the marijuana industry.
Photo courtesy of Nicholas C. Morton.
USDA Appoints Another Hemp Executive To Trade Advisory Committee
Another hemp industry executive has been appointed to a federal advisory committee under the U.S. Department of Agriculture (USDA) and U.S. Trade Representative (USTR).
Patrick Atagi, chairman of the board at the National Industrial Hemp Council (NIHC), will serve as a member of USDA’s Agricultural Technical Advisory Committee for Trade in Tobacco, Cotton and Peanuts, the organization announced on Friday.
He’s the second member of NIHC to join a USDA and USTR advisory panel. Kevin Latner, vice president of marketing for the group, was appointed to the Agricultural Technical Advisory Committee for Trade in Processed Foods in July.
In their federal advisory roles, the NIHC officials will focus on advocating for trade policies that benefit the burgeoning hemp market.
“I want to thank outgoing USDA Secretary Sonny Perdue for his confidence and look to working with Biden Administration Secretary-designate Tom Vilsack and USTR-designate Katherine Tai,” Atagi said in a press release. “It’s an honor to be asked to serve and I look forward to representing the hemp industry.”
These appointments come at a pivotal time, as USDA just last week released its final rule setting out the federal regulations for hemp that will take effect in March. With two industry experts advising the federal agency, they could bring unique insights that further promote market growth.
Early versions of the agency’s proposed regulations were met with mixed reviews from industry stakeholders. While many appreciated USDA’s efforts to stand up the market, there was widespread criticism from businesses and lawmakers over certain provisions viewed as excessively restrictive such as testing requirements and THC limits.
The final rule doesn’t include everything stakeholders sought, but there were some modifications made throughout the process, including adding flexibility in THC testing and extending the sampling window.
These aren’t necessarily areas where the NIHC appointees will be directly involved, but they could help inform regulations from a trade perspective.
Under a trade deal signed last year, China will be required to buy a lot more hemp from the U.S.
Even as USDA crafted its rules and built up these advisory committees, it has spent past months reviewing and approving numerous state and tribal regulatory proposals—most recently for Rhode Island.
Biden Transition Team Highlights Top Health Pick’s Medical Marijuana Work
President-elect Joe Biden’s new pick for a leading role in the U.S. Department of Health and Human Services (HHS) is a strong ally of the medical marijuana community—the latest pro-reform selection to be named in recent weeks.
Rachel Levine, who currently serves as Pennsylvania’s health secretary, is being nominated for assistant secretary of HHS. And the Biden transition team isn’t shying away from her connection to medical cannabis, noting her expertise on the topic in a press release on Tuesday.
“In addition to her recent posts, Dr. Levine is also an accomplished regional and international speaker, and author on the opioid crisis, medical marijuana, adolescent medicine, eating disorders, and LGBTQ+ medicine,” Levine’s official biography states.
Of course, the president-elect is in favor medical cannabis, in addition to a number of other more modest reform proposals such as rescheduling, decriminalizing possession, expunging prior marijuana records and letting states set their own policies. But given his ongoing opposition to adult-use legalization, the cannabis mention on his site is noteworthy.
Pennsylvania Gov. Tom Wolf (D) reacted to Biden’s selection by emphasizing Levine’s cannabis work, noting that during her time in the state’s health department, she “was instrumental in establishing the state’s medical marijuana program, bringing national awareness to opioid use disorder, and highlighting and promoting the need for adequate medical care and access for the LGBTQ community.”
Michael Bronstein, president of the American Trade Association for Cannabis & Hemp, similarly said in a press release that Levine “is a trailblazer who successfully guided the implementation of Pennsylvania’s medical marijuana program.”
“Under Dr. Levine’s leadership, the program expanded qualifying conditions based on science, added flower to help meet patient needs, and stood up a first in the nation marijuana research program,” he said. “Pennsylvania is now one of the quickest growing and most consequential medical marijuana markets in the country in large part due to Dr. Levine’s work.”
In one of the more recent actions in her current role, the health department head oversaw temporary changes to the state’s medical cannabis program in response to the coronavirus pandemic. That included eliminating restrictions on the number of patients a registered caregiver can work with.
“In the midst of COVID-19, we need to ensure medical marijuana patients have access to medication,” she said in March. “We want to be sure cardholders in the medical marijuana program can receive medication for one of 23 serious medical conditions during this difficult time.”
Levine, who would also be the first openly transgender Senate-confirmed federal official, would be serving in an agency that plays a significant role in setting federal marijuana policy. While the Justice Department broadly dictates marijuana’s federal scheduling, a medical and scientific review by HHS is binding on the attorney general’s subsequent classification decision.
Biden’s pick to lead HHS, California Attorney General Xavier Becerra (D), is also amenable to reform.
The president-elect also recently nominated former South Carolina Democratic Party Chair Jaime Harrison to lead the Democratic National Committee—and he’s a strong backer of full marijuana legalization.
Biden announced earlier this month that he wants Rhode Island Gov. Gina Raimondo (D) to run the Commerce Department. The governor came out in support of legalization in 2019, and she released a budget proposal last year that called for a state-run regulatory model for cannabis.
For attorney general, Biden is nominating Judge Merrick Garland, who has not been especially outspoken about his views on marijuana policy. While advocates expressed concern about his commentary in a 2012 federal appeals case on marijuana scheduling, he doesn’t appear to have been publicly hostile to a policy change.
In other positive news for advocates, the president-elect is also set to nominate former prosecutor and civil rights activist Vanita Gupta as associate attorney general. She favors cannabis legalization and has strongly condemned harsh criminalization policies for non-violent drug offenses.
New York Governor Says Budget Uses Marijuana Revenue For Social Equity, With Details Forthcoming
New York Gov. Andrew Cuomo (D) on Tuesday previewed expected revenue from a legal marijuana program he’s proposing through his annual budget, with more detailed legislative language set to be released later in the day.
The governor has repeatedly argued that taxing and regulating cannabis will help fill a historic, $15 billion budget deficit. And while the projected $350 million in annual revenue from marijuana taxes won’t resolve the problem on its own, it represents one opportunity to boost an economy that has suffered amid the coronavirus pandemic.
“We also propose legalizing adult-use cannabis, which would raise about $350 million,” Cuomo said in his budget speech, adding that “$100 million would go to a social equity fund. That would still give us $250 million towards the budget and our needs.”
A briefing book for the governor’s budget states that legalization should be enacted “for the purposes of fostering and promoting temperance in their consumption, to properly protect the public health, safety, and welfare, and to promote social equality.”
Watch Cuomo discuss his marijuana legalization proposal below:
While it’s not immediately clear what that social equity fund would entail, it’s a notable component that advocates are closely monitoring. An outline of his budget plan similarly said the proposal will “correct past harms by investing in areas that have disproportionally been impacted by the war on drugs.”
In the briefing book, the governor calls for three types of taxes on recreational cannabis products: one based on THC content to be applied at the wholesale level, a 10.25 percent surcharge tax at the point of purchase by consumers and applicable state and local sales taxes.
The THC potency tax is intended to “more accurately capture both the true market value and the potential public health risks associated with the final cannabis product,” the governor’s office said, and it will be applied as follows:
“Cannabis flower/pre-roll/shake products are taxed at a rate of 0.7 cent per milligram of THC content. Cannabis concentrates/oil products are taxed at a rate of 1 cent per milligram of THC content, while cannabis infused/edible products are taxed at a rate of 4 cents per milligram of THC content.”
“Of the THC-based tax, retail surcharge, and any license fees, the first $10 million in FY 2023, $20 million in FY 2024, $30 million in FY 2025, $40 million in FY 2026, and $50 million annually thereafter are directed for social equity purposes, with the remainder directed to the newly established New York State Cannabis Revenue Fund,” it states.
A press release from the governor’s office clarifies that $100 million equity figure Cuomo mentioned in his speech is the aggregate funding over the first four years. “These monies will be used to support individuals and communities that have been the most harmed by decades of cannabis prohibition,” it says.
New York Budget Director Robert Mujica similarly said during a follow-up briefing on Tuesday that the social equity effort will support “communities that have been harmed by the nation’s policies with relation to cannabis.”
“As far as the cannabis and social equity fund, that is in the statute—we would have a permanent funding going program,” he said. “So as the program ramps up, a portion of the funding will go $100 million, and then there’ll be an ongoing fund once it ramps up to continue those investments.”
Further, the governor’s briefing book notes that the existing medical cannabis excise tax will continue, as well as “the current revenue distributions for an additional seven years and directing the currently undistributed 45 percent of tax revenue to the newly established New York State Cannabis Revenue Fund.”
The administration also estimates that the equivalent of 208 full-time jobs will be added to the Division of Alcoholic Beverage Control to support the new Office of Cannabis Management, which will be charged with regulating and issuing licenses for the new recreational marijuana market as well as those for medical cannabis and hemp.
Cuomo has twice pitched legalization through the budget, but reform legislation has stalled in part because of disagreements about how to allocate tax revenue. The governor has generally favored putting the monies in the state’s general fund, while leading legislators and activists have pushed for a more targeted distribution centering communities most impacted by the drug war.
If the outline and this latest speech are any indication, it seems Cuomo may be coming around to the latter proposal. But again, the full details of the plan will come when actual legislative language is released later on Tuesday.
In any case, the legislature will have more influence this year after Senate Democrats secured a supermajority in the November election. If the governor were to veto any bill over details he didn’t like, they could potentially have enough votes to override him.
There’s growing recognition within the legislature about the seeming inevitability of marijuana reform this year, regardless of differing opinions on the specifics.
The top Republican in the New York Assembly said last month that he expects the legislature to legalize cannabis this coming session.
Senate Majority Leader Andrea Stewart-Cousins (D) said in November that she also anticipates that the reform will advance next year, though she noted that lawmakers will still have to decide on how tax revenue from marijuana sales is distributed.
Cuomo also said that month that the “pressure will be on” to legalize cannabis in the state and lawmakers will approve it “this year” to boost the economy amid the health crisis.
The push to legalize in New York could also be bolstered by the fact that voters in neighboring New Jersey approved a legalization referendum in November.
Legislators prefiled a bill to legalize cannabis in New York earlier this month. The legislation, introduced in the Senate by Sen. Liz Krueger (D) and 18 other lawmakers, is identical to a version she filed last year that did not advance.
Separately, several other bills that focus on medical marijuana were recently prefiled in New York, and they touch on a wide range of topics—from tenants’ rights for medical cannabis patients to health insurance coverage for marijuana products.
This story has been updated to include comments from the budget director and details about the legalization proposal outlined in the briefing book.