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Vermont Governor Allows Marijuana Sales Legalization Bill To Take Effect Without His Signature

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The governor of Vermont announced on Wednesday that he will allow a bill to legalize marijuana sales in the state to take effect without his signature. He also signed separate legislation to automate expungements for prior cannabis convictions.

While Vermont legalized personal possession of up to one ounce and cultivation of two plants for adults in 2018, retails sales have remained prohibited. But now with Gov. Phil Scott’s (R) decision not to veto the new cannabis commercialization bill, a tax-and-regulate system will finally be implemented.

Differing versions of the marijuana sales proposal passed each chamber before being reconciled in a bicameral conference committee last month. The legislature then approved the finalized proposal and sent it to Scott’s desk. The governor had been noncommittal about his plans for the legislation—even up until the day before the signature deadline—and had hinted that he was even considering vetoing the bill. But he ultimately gave legal cannabis supporters a win by deciding not to block the reform.

In the conference committee, legislators worked fastidiously to ensure that Scott’s stated concerns about the policy change were largely addressed. Those issues primarily related to impaired driving, taxes and local control.

But after the legislature advanced a finalized form, Scott threw advocates for a loop, stating that while he appreciated the legislative process that the bill went through, certain racial justice groups had raised concerns with his office about the extent to which the proposal addressed social equity in the cannabis industry for communities historically targeted by the war on drugs. There was some suspicion that the governor was using that pushback as an excuse to veto S. 54.

On Tuesday, the day before his deadline to act on the bill, the governor said lawmakers “did move forward in a lot of areas that I had concerns about, but it still isn’t exactly what I’d like to see and there are some shortcomings.”

In the end, however, he stood out of the way and took no proactive action.

“However, there is still more work to be done to ensure the health and safety of our kids and the safety of our roadways—we should heed the public health and safety lessons of tobacco and alcohol,” Scott wrote in a letter to lawmakers announcing his decision. “Further, I believe we are at a pivotal moment in our nation’s history which requires us to address systemic racism in our governmental institutions. We must take additional steps to ensure equity is a foundational principle in a new market.”

“The concerns with this bill of the communities historically most negatively affected by cannabis enforcement were not meaningfully incorporated into this bill,” he said.

The governor raised several areas where he feels lawmakers can tweak the legislation in the 2021 session.

The new law will give existing medical cannabis businesses an “an unfair head start on market access” over would-be new entrants to the legal industry, he said, arguing that lawmakers “should consider include creating a social equity applicant category for cannabis establishment licenses” as well as a 50 percent licensing fee waiver for those applicants and additional technical and financial assistance.

“And in the event the Legislature maintains the current integrated licensing structure, to make it more equitable revenues from those licensees could be directed to benefit social equity applicants and the communities historically most negatively impacted by cannabis enforcement,” Scott wrote.

He also expressed concern about cannabis vaping products, marketing that could appeal to youth, roadside impaired driving enforcement training for police and the timeline for appointing a new regulatory board as well as the process by which its members could be removed.

Finally, Scott said that the 30 percent of cannabis excise taxes that are set aside for substance misuse prevention programs should be allocated by the Commissioner of Health. “As passed, this funding could be raided by the Legislature and used for other unrelated purposes,” he wrote.

It’s possible that there was some political calculus involved in the decision to let the bill go into law despite his concerns, as his reelection challenger, Lt. Gov. David Zuckerman (D), is a vocal advocate for legalization and has raised the issue in recent appearances.

Zuckerman stressed in a debate last week that while he agrees with the sentiment that more needs to be done to ensure racial justice, an imperfect bill can be improved upon, and the legislature has plenty of time to finesse the details before legal cannabis sales launch.

He also noted that separate legislation providing for automatic expungements of prior cannabis convictions, which Scott signed on Wednesday, would complement the restorative justice provisions of the tax-and-regulate bill.

A coalition of Vermont civil rights and criminal justice reform groups including the state’s ACLU chapter released a statement on Sunday that says while they shared concerns about the limitations of the social equity components of the marijuana commerce bill, they felt it could be built upon and wanted the governor to sign it, in addition to the expungements legislation.

“This has been a top priority for the majority in the Legislature for four years, but their work is not complete,” Scott said on Wednesday. “They must ensure equity in this new policy and prevent their priority from becoming a public health problem for current and future generations.”

Legalization advocates celebrated the fact that another state system of regulated cannabis sales is set to come online.

“It’s a great relief to learn that Vermont will finally move forward with plans to replace prohibition with sensible regulation,” Matt Simon, New England Political Director for the Marijuana Policy Project, told Marijuana Moment. “Legislators bent over backwards to address Gov. Scott’s concerns throughout this process, and it’s now clear that these difficult compromises weren’t made in vain.”

“Much work remains to create a responsible and equitable cannabis industry in Vermont, but now that S. 54 has passed the state is definitely on the right track,” he said.

State Attorney General T.J. Donovan (D) said in a Twitter post that the new bill “brings good governance & common sense to VT’s cannabis law. It will provide revenue to fund protections for consumers, education programs & safety measures.”

Under the tax-and-regulate bill, a new Cannabis Control Commission will be responsible for issuing licenses for retailers, growers, manufacturers, wholesalers and labs. The body will also take over regulation of the state’s existing medical cannabis industry from the Department of Public Safety.

A 30 percent THC limit will be imposed on cannabis flower, while oils could contain up to 60 percent THC. Flavored vape cartridges will be banned.

Local jurisdictions will have to proactively opt in to allow marijuana businesses to operate in their area. Municipalities will also be able to establish their own regulations and municipal licensing requirements.

timeline for the legislation states that it will formally take effect on October 1, 2020—but regulators would then have to make a series of determinations about rules and licensing before retail sales would launch. Dispensary licenses will have to be issued on or before October 1, 2022.

fiscal analysis on the final bill projects that Vermont will generate between $13.3 million and $24.2 million in annual cannabis tax revenue by Fiscal Year 2025. Licensing fees will lead to additional funds for the state, but the regulatory board created by the legislation will set those levels at a later date. For now, the Joint Fiscal Office estimates the fees could lead to another $650,000 in revenue every year. Municipalities hosting marijuana businesses will also be able to levy additional local fees.

The separate expungements bill would make it so those with convictions for marijuana possession of up to two ounces, four mature plants and eight immature plants prior to January 2021 would have their records automatically cleared. Those who receive expungements would be notified by mail.

The governor had vetoed an earlier version of a noncommercial legalization bill in 2018 before negotiating changes with lawmakers that made him comfortable with signing revised a revised form of the legislation.

Read Scott’s full letter to lawmakers below:

Vermont Governor Marijuana Bill Letter by Marijuana Moment on Scribd

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Marijuana Moment is made possible with support from readers. If you rely on our cannabis advocacy journalism to stay informed, please consider a monthly Patreon pledge.

Kyle Jaeger is Marijuana Moment's Sacramento-based senior editor. His work has also appeared in High Times, VICE and attn.

Politics

Federal Agency Loosens Marijuana-Related Grant Funding Restrictions For Mental Health Treatment

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The federal Substance Abuse and Mental Health Services Administration (SAMHSA) loosened restrictions this week on grant funding for state health providers and other entities that allow patients to use medical marijuana for mental heath treatment.

The Pennsylvania Department of Drug and Alcohol Programs flagged the new policy change in a notice to SAMHSA grant recipients on Monday. It said that the federal agency has removed language from its terms and conditions that until now has prevented grant funds from going to any institution that “provides or permits marijuana use for the purposes of treating substance use or mental disorders.”

This restriction led the state department to issue a memo in June warning recipients and applicants about the possible withholding of funding.

Despite the recent change, SAMHSA is still continuing a narrower ban that says federal funds themselves “may not be used to purchase, prescribe, or provide marijuana or treatment using marijuana.”

The broader prohibition, which has now been rescinded, prompted a notice last year from Maine’s Education Department, which said is was no longer eligible for certain federal funds to support mental health programs in schools because the state allows students to access medical marijuana.

It seems the federal agency is now being somewhat more permissive.

Here’s how SAMHSA’s updated marijuana restriction reads:

“SAMHSA grant funds may not be used to purchase, prescribe, or provide marijuana or treatment using marijuana. See, e.g., 45 C.F.R. 75.300(a) (requiring HHS to ensure that Federal funding is expended in full accordance with U.S. statutory and public policy requirements); 21 U.S.C. 812(c)(10) and 841 (prohibiting the possession, manufacture, sale, purchase or distribution of marijuana).”

The older, more broad prohibition read:

“Grant funds may not be used, directly or indirectly, to purchase, prescribe, or provide marijuana or treatment using marijuana. Treatment in this context includes the treatment of opioid use disorder. Grant funds also cannot be provided to any individual who or organization that provides or permits marijuana use for the purposes of treating substance use or mental disorders. See, e.g., 45 C.F.R. § 75.300(a) (requiring HHS to “ensure that Federal funding is expended in full accordance with U.S. statutory requirements.”); 21 U.S.C. §§ 812(c)(10) and 841 (prohibiting the possession, manufacture, sale, purchase or distribution of marijuana). This prohibition does not apply to those providing such treatment in the context of clinical research permitted by the DEA and under an FDA-approved investigational new drug application where the article being evaluated is marijuana or a constituent thereof that is otherwise a banned controlled substance under federal law.”

The marijuana restrictions were first added to grant award terms for Fiscal Year 2020. The language was initially carried over to Fiscal Year 2021 but was more recently switched out for the narrower language by the federal agency.

In a January 2020 FAQ that the Pennsylvania department shared from SAMHSA this June, the federal agency responded to a prompt inquiring whether grant recipients can serve patients who are “very clear about their wish to remain on their medical marijuana for their mental or substance use disorder.”

“No. The organization cannot serve a patient who is on medical marijuana for a mental or substance use disorder and wishes to remain on such treatment,” it said. “SAMHSA promotes the use of evidence-based practices and there is no evidence for such a treatment; in fact, there is increasing evidence that marijuana can further exacerbate mental health symptoms.”

While the agency seemed adamant in enforcing that policy at the time, it appears to have had a change of heart and has since loosened the restriction.

A SAMHSA spokesperson told Marijuana Moment that the new rules took effect on Sunday, but played down their significance.

“This Aug. 1 clarification simply made clearer what was already in place: SAMHSA funds should not be used to procure a federally prohibited substance,” he said in an email.

While it is true that the revised provision, as was the case in the prior language, states that federal funds cannot be used to pay for marijuana, the spokesperson avoided commenting on the new deletion of the broader prohibition on grants going to entities that otherwise allow patients to use medical cannabis to treat substance use or mental disorders.

After SAMHSA announced in 2019 that its marijuana policy would impact organizations applying for its two main opioid treatment programs and another that provides funding to combat alcoholism and substance misuse, the Illinois Department of Human Services and Oregon Health Authority issued notices on the impact of the rule.

Read the Pennsylvania department’s notice on the SAMHSA marijuana policy change below: 

Pennsylvania SAMHSA marijuana by Marijuana Moment

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Photo courtesy of Philip Steffan.

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Mexican Lawmakers Could Finally Legalize Marijuana Sales Next Month (Op-Ed)

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The legislature missed repeated deadlines, and then the Supreme Court moved to allow homegrow. What’s next?

By Zara Snapp, Filter

Mexico has never seemed so close and yet so far from fully regulating the adult-use cannabis market.

first Supreme Court resolution determined in 2015 that the absolute prohibition of cannabis for personal use was unconstitutional because it violates the right to the free development of personality. To reach jurisprudence in Mexico, five consecutive cases, with the same or more votes each time, must be won before the Supreme Court. This was achieved in October 2018, which detonated a legislative mandate that within 90 days, the Senate should modify the articles in the General Health Law that were deemed unconstitutional.

The first deadline came and went without the Senate modifying the articles; so the Senate requested an extension, which was granted. The second deadline to legislate expired on April 30, 2020—but another extension was provided because of the COVID-19 pandemic.

At first, it looked like the third time was the charm. The Senate overwhelmingly approved the Federal Law to Regulate and Control Cannabis in November 2020 and passed it to the Chamber of Deputies, the lower house, for review and approval. Since the deadline of December 15, 2020, was fast approaching, the Chamber asked for its own extension. The Supreme Court granted it (until April 20, 2021) and the bill underwent significant changes before being approved by the Chamber on March 10, and so sent back to the Senate.

The Senate certainly had enough time to review and either reject or accept the changes made by the lower house. That would have made this a shorter story. However, the Senate had other plans. Rather than approve the bill or request an additional extension, it simply did not do anything. June’s national midterm elections were approaching, and political calculations were made. The legislative process came to a standstill.

Since the Senate did not approve the bill by the deadline, the Supreme Court basically did what it had mandated Congress to do. It activated a mechanism to guarantee rights that had only been undertaken once before in Mexican history: the General Declaration of Unconstitutionality (GDU).

On June 28, the Supreme Court approved, with a qualified majority of eight of the 11 Ministers, that two articles in the General Health Law must be modified to permit adults to cultivate cannabis for personal use in their homes.

These changes were officially published on July 15, with specific instructions to the Health Secretary to approve authorizations for any adult who applies.

The GDU has certain restrictions attached, including that this is only for personal use and cannot be used to justify any commercialization of cannabis or cannabis-derived products. Adults cannot consume in front of minors, or other adults who have not expressly given their permission. Nor can they operate heavy machinery or drive while under the effects.

With the GDU, the judicial process concludes. However, the Supreme Court was clear in its final recommendations: Congress can and should legislate to clear up inconsistencies and generate a legal framework for cannabis users.

Whether the Senate decides to take up the matter again in September when it returns to its legislative session will depend largely on its political whim. The body no longer has a deadline to meet; however, there are growing calls from society to regulate the market beyond home-grow, as well as several legal contradictions that obviously need to be harmonized.

The General Health Law has now been modified and the health secretary must approve permits or authorizations for adults to cultivate in their homes. But the Federal Criminal Code has not changed—it still penalizes those same activities with sanctions ranging from 10 months to three years or more in prison.

The Supreme Court decision ignores the need for a comprehensive regulation that would allow the state to apply taxes to commercial activities, which are currently still criminalized with penal sanctions. It also overlooks the urgency of an amnesty program for the thousands of people currently incarcerated on low-level cannabis charges, or hampered by criminal records for such charges.

The Senate should now revisit the bill it initially passed. It should maintain the positive aspects of the bill, which would improve things well beyond the scope of the Supreme Court decision. These include provision for cannabis associations (permitting up to four plants per person for up to 20 members), for home-grow without the need to request authorization, and for a regulated market with a social justice perspective—allocating 40 percent (or more!) of cultivation licenses to communities harmed by prohibition and imposing restrictions on large companies.

The Senate could also build upon the previous version of the bill by eliminating simple possession as a crime, by allowing the associations to operate immediately and guaranteeing the participation of small and medium companies through strong government support.

During the last three years, and before, civil society has closely accompanied the process of creating this legislation, providing the technical and political inputs needed to move forward in a way that could have great social benefits for Mexico.

By becoming the third country in the world to regulate adult cannabis use, after Uruguay and Canada, Mexico could transition from being one of the largest illegal producers to being the largest legal domestic market in the world. As well as economic benefits, this could have substantial impacts on how criminal justice funds are spent, freeing up law enforcement dollars to focus on high-impact crimes and changing the way the state has shown up in communities that cultivate cannabis.

Rather than eradicating crops, the government could accompany communities in gaining legal licenses, provide technical assistance and improve basic services. These positive externalities of regulation could signal a shift from a militarized state of war to a focus on rights, development and social justice.

Of course, this all depends on key political actors recognizing the benefits—and that requires political will. Mexico deserves better; however, it remains to be seen whether legislators will act.

This article was originally published by Filter, an online magazine covering drug use, drug policy and human rights through a harm reduction lens. Follow Filter on Facebook or Twitter, or sign up for its newsletter.

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Oregon Governor Plans To Veto Bill To Regulate Kratom Sales That Advocates Say Would Protect Consumers

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The governor of Oregon has announced her intent to veto a bill that’s meant to create a regulatory framework for the sale and use of kratom for adults.

The Oregon Kratom Consumer Protection Act is bipartisan legislation that would make it so only people 21 and older could purchase the plant-based substance, which some use for its stimulating effects and which others found useful in treating opioid withdrawals.

Vendors would have to register with the state Department of Agriculture to sell kratom. The agency would be responsible for developing regulations on testing standards and labeling requirements. The bill would further prohibit the sale of contaminated or adulterated kratom products.

But while the House and Senate approved the legislation in June, Gov. Kate Brown (D) said on Sunday that she plans to veto it, in large part because she feels the federal Food and Drug Administration (FDA) is better suited to regulate the products.

“Given there is currently no FDA-approved use for this product and there continues to be concern about the impacts of its use, I would entertain further legislation to limit youth access without the state agency regulatory function included in this bill,” the governor said.

This comes as a disappointment to advocates and regulators who share concerns about the risks of adulterated kratom but feel a regulatory framework could help mitigate those dangers and provide adults with a safe supply of products that have helped some overcome opioid addiction.

“Kratom has been consumed safely for centuries in Southeast Asia and Americans use it in the same way that coffee is used for increased focus and energy boosts. Many use kratom for pain management without the opioid side effects,” Rep. Bill Post (R), sponsor of the bill, wrote in an op-ed published in June. “The problem in Oregon is that adulterated products are being sold.”

“Kratom in its pure form is a natural product,” he said. “Adulterated kratom is a potentially dangerous product.”

Pete Candland, executive director of the American Kratom Association, said in written testimony on the bill in February that four other states—Utah, Georgia, Arizona and Nevada—have enacted similar legislation with positive results.

He said that “the number of adulterated kratom products spiked with dangerous drugs like heroin, fentanyl, and morphine in those states has significantly decreased” in those states.

Meanwhile, six states—Vermont, Alabama, Indiana, Wisconsin, Arkansas and Rhode Island—have banned kratom sales altogether.

Candland said that number is actually a testament to the noncontroversial nature of the plant, as prohibition is only in effect in six states despite “a full-throated disinformation campaign on kratom by the FDA with outrageously untrue claims about kratom being the cause of hundreds of deaths.”

After failing to get kratom prohibited domestically, FDA recently opened a public comment period that’s meant to inform the U.S. position on how the substance should be scheduled under international statute.

“Kratom is abused for its ability to produce opioid-like effects,” FDA wrote in the notice. “Kratom is available in several different forms to include dried/crushed leaves, powder, capsules, tablets, liquids, and gum/ resin. Kratom is an increasingly popular drug of abuse and readily available on the recreational drug market in the United States.”

Responses to the notice will help inform the federal government’s stance on kratom scheduling in advance of an October meeting of the World Health Organization’s (WHO) Expert Committee on Drug Dependence, where international officials will discuss whether to recommend the substance be globally scheduled.

Last week, the U.S. House of Representatives approved a report to spending legislation that says federal health agencies have “contributed to the continued understanding of the health impacts of kratom, including its constituent compounds, mitragynine and 7-hydroxymitragynine.”

It also directed the Health and Human Services secretary to continue to refrain from recommending that kratom be controlled in Schedule I.

Late last year, the Agency for Healthcare Research and Quality (AHRQ) asked the public to help identify research that specifically looks at the risks and benefits of cannabinoids and kratom.

The Centers for Disease Control and Prevention (CDC) last year separately received more than one thousand comments concerning kratom as part of another public solicitation.

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