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USDA Releases, Then Rescinds, Hemp Loan Notice Following Congressional Action

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The U.S. Department of Agriculture (USDA) recently released—and then promptly rescinded—a notice on providing federal loans for hemp processors.

After the crop was federally legalized under the 2018 Farm Bill, USDA announced that regulations were being developed to offer direct and guaranteed loans to the industry. The federal agency unveiled those guidelines in April and then issued a new notice this month notifying applicants about the policy change ahead of the planned expiration of the earlier 2014 hemp pilot program.

The next day, however, it posted an “obsoleting notice” invalidating the prior document.

The new guidance “was developed with the understanding that operators would no longer be authorized to produce hemp under the 2014 Farm Bill Pilot Program,” USDA said. However, because Congress approved a continuing resolution that extends the program until September 30, 2021, the loan policies are not currently applicable.

That pilot program extension came at the behest of numerous stakeholders, advocates and lawmakers who have been pushing USDA to make a series of changes to its proposed hemp regulations. As those rules are being reviewed and finalized, they said it was necessary to keep the 2014 program in place.

The president signed the continuing resolution late last month, so it’s not clear why the notice on loan policy changes was released weeks later, which then necessitated a follow-up recision. But in any case, it’s another example of the fluidity and challenges of rulemaking for the non-intoxicating cannabis crop following its legalization.

It stands to reason that the loan processes outlined in the now-invalid notice will likely be consistent with what’s ultimately released next year, assuming the pilot program does expire then.

The primary rule change concerns licensing requirements for borrowers. After the 2014 regulations are no longer in effect, hemp loan applicants must be licensed under a USDA-approved state or tribal hemp program, or under the agency’s basic regulations if the jurisdiction the business operates in has not submitted its own rules.

Borrowers who are not licensed to grow hemp will be considered in non-monetary default and any losses will not be covered. For direct and guaranteed loans, hemp businesses must have a contract with USDA’s Farm Service Agency laying out termination policies and their ability to repay the loans.

As of this month, USDA has approved a total of 69 state and tribal hemp regulatory proposals—mostly recently for Illinois, Indiana, Michigan, New Mexico, Oklahoma and South Dakota. Illinois and Oklahoma were among a group of states that USDA had asked to revise and resubmit their initial proposals in August.

While the agency released an interim final rule for a domestic hemp production program last year, industry stakeholders and lawmakers have expressed concerns about certain policies it views as excessively restrictive.

USDA closed an extended public comment period on its proposed hemp regulations earlier this month. Its initial round saw more than 4,600 submissions, but it said last month that it was reopening the feedback period in response to intense pushback from stakeholders on its original proposal.

The federal Small Business Administration (SBA) said last month that the new 30-day comment window is too short and asked USDA to push it back, and it also issued a series of recommended changes to the interim final rule on hemp, which it says threaten to “stifle” the industry and benefit big firms over smaller companies.

All told, it appears that USDA is taking seriously the feedback it’s received and may be willing to make certain accommodations on these particular policies. The department’s rule for hemp is set to take effect on October 31, 2021.

In July, two senators representing Oregon sent a letter to Perdue, expressing concern that hemp testing requirements that were temporarily lifted will be reinstated in the agency’s final rule. They made a series of requests for policy changes.

Senate Minority Leader Chuck Schumer (D-NY) wrote to Perdue in August, asking that USDA delay issuing final regulations for the crop until 2022 and allow states to continue operating under the 2014 pilot program in the meantime.

Sen. Cory Gardner (R-CO) also called on USDA to delay the implementation of proposed hemp rules, citing concerns about certain restrictive policies the federal agency has put forward in the interim proposal.

The senators weren’t alone in requesting an extension of the 2014 pilot program that was ultimately enacted legislatively, as state agriculture departments and a major hemp industry group made a similar request to both Congress and USDA in August.

Amid the coronavirus pandemic, hemp industry associations pushed for farmers to be able to access to certain COVID-19 relief loans—a request that Congress granted in the most recent round of coronavirus legislation.

While USDA previously said that hemp farmers are specifically ineligible for its Coronavirus Food Assistance Program, that decision was reversed last month. While the department initially said it would not even reevaluate the crop’s eligibility based on new evidence, it removed that language shortly after Marijuana Moment reported on the exclusion.

Meanwhile, USDA announced last week that it is planning to distribute a national survey to gain insights from thousands of hemp businesses that could inform its approach to regulating the industry.

Kamala Harris Touts ‘Commitment’ To Marijuana Decriminalization And Expungements Under Biden Administration

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New Jersey Prosecutors Must Suspend Marijuana Possession Cases, State Attorney General Says

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The New Jersey attorney general on Wednesday told prosecutors to adjourn most marijuana possession cases until at least January 25, 2021 following voter approval of a referendum to legalize cannabis for adult use this month.

While the initiative amends the state Constitution to legalize marijuana for those 21 and older, lawmakers must still pass enabling legislation to create a regulatory framework for cannabis sales. The day after the election, Attorney General Gurbir Grewal (D) had issued initial guidance to prosecutors encouraging them to use discretion when it comes to marijuana offenses that will soon be codified as legal.

But this latest announcement expands on that memo, ordering prosecutors to pause cases involving a wide range of low-level cannabis possession offenses.

“Fairness demands that we suspend prosecution of marijuana possession-related cases while we await direction from the Legislature on the parameters for decriminalization of marijuana and legalization of regulated adult-use cannabis,” Grewal said. “It simply does not make sense or serve justice to proceed with prosecutions on charges that may be foreclosed soon through legislative action.”

The attorney general’s office listed seven specific laws that will be impacted by the temporary policy change, including those penalizing possession of up to 50 grams of cannabis and being under the influence of marijuana.

“Notably, today’s guidance does not affect the prosecution of cases charging distribution of marijuana or possession of marijuana with intent to distribute,” a press release from his office says.

The new memo specifies that “in cases where there are other pending charges in addition to the marijuana possession-related offenses enumerated above, prosecutors shall use their discretion to either postpone the case in its entirety or seek dismissal, without prejudice, of the above-enumerated marijuana possession-related charge(s) and proceed with prosecution of the remaining charges.”

In the previous guidance released earlier this month, Grewal recognized that there may be some confusion among residents about the implications of the legalization referendum’s passage so police and prosecutors “should exercise discretion” in pursuing marijuana cases, as outlined under earlier 2018 guidance that he issued.

A municipal prosecutor recently argued in a memo sent to colleagues across the state that voters’ approval of the legalization referendum, as well as the attorney general’s earlier directive this month, means that many current cannabis cases should not be pursued.

Senate President Steve Sweeney (D), who previously pressed the attorney general to issue guidance to suspend arrests and court cases for possession of marijuana, praised the new move on prosecutions.

“Now that the people of NJ have spoken no one should be subject to facing criminal charges for minimal amounts of this substance,” he said in a tweet.

Enabling legislation to set rules for the state’s cannabis market was introduced just days after the referendum vote, and it’s already advancing at the committee level.

Most recently, the Assembly Appropriations Committee and Senate Budget and Appropriations Committee approved legalization bills, albeit in differing forms that will have to be resolved. Planed floor votes for this week have been canceled as leaders hold bicameral negotiations on outstanding details.

Meanwhile, the Senate recently approved a separate marijuana decriminalization bill and the Assembly was supposed to vote on it as well, but that was also pushed back amid disagreement about an amendment to lower penalties for psilocybin, and has yet to be rescheduled.

In anticipation of the legislature’s approval of a legalization bill, Gov. Phil Murphy (D) recently named an official to lead the state’s Cannabis Regulatory Commission that will oversee the legal marijuana market.

Republican Lawmakers And Celebrities Push Trump To Free Marijuana Prisoners Before Leaving Office

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Republican Lawmakers And Celebrities Push Trump To Free Marijuana Prisoners Before Leaving Office

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A group of celebrities, Republican officials and civil rights advocates sent a letter to President Trump on Wednesday, urging him to pardon or commute the sentences of people in federal prison for nonviolent federal marijuana offenses.

The letter, which organizers said they adapted from an earlier request after discussing the previous proposal with the office of Trump senior adviser and son-in-law Jared Kushner, states that the signatories “strongly believe that justice necessitates the exercise of executive clemency in these cases.”

Unlike the last version, the new letter comes with an attachment—at the request of Kushner’s office, advocates said—of a specific list of 24 people who are currently behind bars for cannabis offenses, including several who are serving life sentences.

Weldon Angelos, who himself was convicted over cannabis and handed a mandatory minimum sentence before a court cut his sentence and released him, personally delivered the first version of the letter to the White House in March. He told Marijuana Moment that Kushner’s office then reached out to his organization, Mission Green, to request that, in addition to redelivering the request, advocates include a list of incarcerated people who they feel are especially entitled to presidentially granted relief.

Those two dozen currently incarcerated individuals include people like Luke Scarmazzo, who was sentenced to 22 years in federal prison for operating a state-legal medical cannabis business in California. These inmates shouldn’t have to wait for Congress to get around to enacting federal policy change, and the president should use executive action to pardon them, the letter states.

“You have expressed support for the States’ right to implement their own cannabis laws, especially for medicinal purposes,” the signatories, including former NBA star Kevin Garnett, wrote. “And while there are a number of proposals being introduced in Congress to finally put an end to cannabis prohibition, they tend to lack any real avenue of relief for those who are serving time for selling cannabis.”

“Given the timidity of this proposed legislation, the gridlock in Congress, and the imperative of freedom, clemency is the right tool to fix this problem,” it continues. “You and you alone have the power to call out a grand hypocrisy of prior administrations. While cannabis became a thriving, legal market and enriched many, your predecessors ignored the people who were—and are—serving long federal terms for doing the same thing.”

Leaders in the Democratic-controlled House of Representatives announced that they plan to vote on a far-reaching bill to federally legalize marijuana next month, but the Republican Senate has shown no signs it intends to follow suit.

Among the more than 50 signatories of the new letter is Alice Johnson, who appeared at the Republican National Convention and whose story was featured in Trump campaign ads after her drug sentence was commuted by the president.

Republican state lawmakers from Kansas, Maine and Missouri also signed on, as did a former U.S. attorney, actor Danny Trejo, the New Haven, Connecticut police chief and former New Mexico governor and presidential candidate Gary Johnson. They were joined by representatives of groups like #cut50, Marijuana Policy Project and Law Enforcement Action Partnership.

So far during his administration, Trump has granted 27 pardons and 11 commutations. But the advocates behind this letter, including members of the CAN-DO Foundation, which partnered with Mission Green, expect to see a ramping up of clemency from the executive office in the coming weeks, as is traditional during the final weeks of a presidency.

Kushner and the White House press office did not immediately reply to Marijuana Moment’s request for comment for this story.

Angelos said that he hasn’t received confirmation on timing, but he expects Trump to announce additional pardons and commutations as early as the Thanksgiving holiday.

“It’s ridiculous that we currently have a billionaire in the cannabis industry, yet we are keeping select individuals in prison for doing the exact same thing. This is just another example of a wasteful and destructive criminal justice system,” he said in a press release. “I firmly believe President Trump will strongly consider fixing some of the most egregious sentences that we have brought to his attention.”

“He’s the first president on modern history to commute a number of sentences in his first few years in office,” he added. “Traditionally, pardons and commutations happen at the end of a presidency, and so this pattern gives us some comfort that we will get justice for some of them.”

It’s not clear how Trump will react to the request for a round of cannabis-specific clemency.

His reelection campaign worked to frame him as the criminal justice reform candidate, but he hasn’t proactively championed marijuana reform, has made several anti-legalization administration hires and issued signing statements stipulating that he reserves the right to ignore long-standing congressional riders that prohibit the Justice Department from using its funds to interfere with state-legal medical cannabis programs.

Also, despite his pledged support for medical marijuana and states’ rights, the president evidently holds some negative views toward cannabis consumption, as evidenced in a 2018 recording in which he said that using it makes people “lose IQ points.”

Read the letter to Trump about marijuana clemency below:

Letter to President Trump -… by Marijuana Moment

Marijuana Legalization Is Inevitable In New York, Especially After New Jersey Vote, Top Senator Says

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New Jersey Prosecutor Urges Colleagues To Stop Pursuing Most Marijuana Cases While Legalization Bill Advances

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A municipal prosecutor in New Jersey is arguing in a memo sent to colleagues across the state that voters’ approval of a marijuana legalization referendum this month, and subsequent guidance from the attorney general, means that many current cannabis cases should not be pursued.

In a two-page message to other top law enforcement officials that was shared with Marijuana Moment, Jon-Henry Barr, the municipal prosecutor for the Township of Clark, said that he appreciated that state Attorney General Gurbir Grewal (D) released guidance stipulating that police and prosecutors “should exercise discretion” in pursuing marijuana cases.

But voters made clear on Election Day that they no longer want to see adults 21 and older to be convicted for simple possession, he said, and they also lack control over lawmakers’ timeline for passing enabling legislation that would codify that policy statewide.

“New Jersey’s municipal prosecutors can look to the text of the State Constitution and interpretive caselaw for more guidance about what should be done with pending cases,” Barr, who is a past president of the New Jersey State Municipal Prosecutor’s Association and is a member of the pro-reform group Law Enforcement Action Partnership, wrote. “The primary duty of a lawyer engaged in public prosecution is not to convict, but to see that justice is done.”

The attorney general’s reminder that prosecutors have discretion in cannabis cases is important, but it still leaves questions about how exactly they should proceed in the interim while lawmakers work on implementing regulations for a legal marijuana market, he said.

“In light of the global pandemic and the statewide referendum, are the interests of justice served by continuing to prosecute low level marijuana cases?” he asked. “I conclude that no reasonable argument can be made to claim that the interests of justice are accomplished by maintaining the prosecution of most current cases. However, that does not mean that all cases should simply be summarily dismissed.”

In terms of what types of cases could continue to be subject to prosecution, Barr said the referendum simply applied to low-level possession for those 21 and older. Underage possession, distribution and possession with the intent to distribute should all still be pursued on a case by case basis, at least while the legislature works to enact specific regulations.

While the attorney general in 2018 issued previous initial guidance encouraging discretion in marijuana cases, Barr said the referendum vote demonstrates that “public policy in New Jersey has now shifted significantly further, and it is my thoughtfully considered, carefully researched, and well-reasoned position that most, but not all, current marijuana cases should not be prosecuted.”

“I again maintain that this memo fully respects and complies with the direction provided thus far by the attorney general of New Jersey, and complete deference to his directives will continue,” he said.

Enabling legislation to set rules for the state’s cannabis market was introduced just days after the referendum vote, and it’s already advancing at the committee level.

Most recently, the Assembly Appropriations Committee and Senate Budget and Appropriations Committee approved legalization bills, albeit in differing forms that will have to be resolved. Planed floor votes for this week have been canceled as leaders hold bicameral negotiations on outstanding details.

Meanwhile, the Senate recently approved a separate marijuana decriminalization bill and the Assembly was supposed to vote on it as well, but that was also pushed back amid disagreement about an amendment to lower penalties for psilocybin, and has yet to be rescheduled.

In anticipation of the legislature’s approval of a legalization bill, Gov. Phil Murphy (D) recently named an official to lead the state’s Cannabis Regulatory Commission that will oversee the legal marijuana market.

Read the memo to prosecutors on marijuana enforcement discretion below: 

Memo on marijuana prosecuti… by Marijuana Moment

Connecticut Lawmakers Will Put Marijuana Legalization On The Ballot If Legislature Rejects Bill

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