A Vermont panel of House and Senate negotiators have reached a final compromise deal on a bill to tax and regulate marijuana sales in the state.
While Vermont legalized possession of up to one ounce of cannabis and cultivation of two plants in 2018, there are currently no regulations in place that allow for retail sales. That would change under S. 54, which previously cleared both chambers of the legislature before being sent to the bicameral conference committee to reconcile differences.
The panel has held a series of meetings on the legislation in recent weeks, with members negotiating key provisions such as tax rates, local control, saliva testing and advertising. Each side offered a bevy proposals and counterproposals in the final housrs of negotiations before reaching an agreement late Tuesday. Sen. Jeannette White (D), a conferee, confirmed to Marijuana Moment that the conference report was signed by all six members of the panel.
Here are the main compromises on remaining issues reached by the bicameral group of lawmakers:
-The excise tax rate on marijuana will be set at 14 percent, in addition to the state’s six percent sales tax. The Senate agreed to give up a proposal to have two percent of that 14 percent go to local jurisdictions; instead, those municipalities would receive funds through license and distributor fees.
-In order to conduct a saliva test for suspected cannabis-impaired driving, police would need to obtain a search warrant and the sample couldn’t be taken at roadside. The Senate opposed saliva testing, despite Gov. Phil Scott’s (R) insistence on it, but conceded on the condition that the House drop unrelated language it wanted about seatbelt enforcement.
-The House agreed to drop a section that would have outright prohibited cannabis businesses from advertising. Regulators will work with the state attorney general and health department to come up with rules for advertising.
“There are issues that I disagree with, others I agree with—such is the nature of compromise. The one issue I continue to disagree with is how we are sending revenue to the towns,” White told Marijuana Moment. “The Senate proposal was that the towns that host any type of establishment should share in the revenue. The House insisted on fees which will be added to the establishments thus increasing the ultimate cost to the customers.”
“But I signed on to the report because it finally starts a regulated and taxed system in Vermont—years after working on it,” she said. “So if it gets passed we will have something to tweak over the next couple years, if it doesn’t pass we have nothing to tweak. So I will continue to work on this next session.”
Sen. Dick Sears (D), the chairman of his chamber’s Judiciary Committee and the lead sponsor of S.54, told The Bennington Banner, which first reported on Tuesday’s agreement, that the bill is “not perfect,” but there’s been “a lot of compromise, a lot of give and take on both sides to get to a place where we could reach agreement.”
The bill will now head back to the House and Senate floors for final votes on the compromise language before being sent to the governor’s desk. Scott hasn’t indicated whether he’s supportive of the newly revised legislation, but a top legislator said earlier this year that he’s been “at the table” in earlier negotiations and has expressed interest in using some tax revenue to fund an after-school program he’s pursuing. That said, he only reluctantly signed the legalization of possession and homegrow into law after vetoing an earlier version, and it’s not clear if the road safety provisions in the final commercialization bill will be enough to satisfy his concerns.
S. 54 also contains some social equity provisions such as prioritizing marijuana business licenses for minorities, women and people disproportionately impacted by the war on drugs. An independent regulatory commission would additionally be tasked with promoting small business participation in the market.
A new Cannabis Control Commission would be responsible for issuing licenses for retailers, growers, manufacturers, wholesalers and labs. The body would also take over regulation of the state’s existing medical cannabis industry from the Department of Public Safety .
A 30 percent THC limit would be imposed on cannabis flower, while oils could contain up to 60 percent THC. Flavored vape cartridges would be banned.
Local jurisdictions would have to proactively opt in to allow marijuana businesses to operate in their area—a concession made by the Senate, which instead wanted to require towns that didn’t want cannabis commerce to opt out. Municipalities would also be able to establish their own regulations and municipal licensing requirements.
A timeline for the legislation states that it would 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 would have to be issued on or before October 1, 2022.
“This was a difficult compromise for legislators, who faced pressure from many different directions,” Matt Simon, New England political director for the Marijuana Policy Project, told Marijuana Moment. “We applaud them for sticking with the task and completing it. The need for a regulated cannabis market in Vermont has never been more urgent, and this bill has come too far to fail—it would be a terrible shame if Vermont doesn’t finish the job and pass S. 54 into law.”
The bill is on the House notice calendar for Wednesday, meaning a floor vote could be taken as soon as Thursday. After that, the Senate will take up its final consideration, likely sending the proposal to Scott’s desk sometime next week.
Outside of the cannabis sales legalization bill, the House last week gave preliminary approval to separate legislation that would provide for automatic expungements of marijuana convictions and allow people to possess and grow more cannabis without the threat of jail time than is currently allowed. It’s now on the Senate notice calendar, which allows for a vote as early as Thursday.
Read the text of the marijuana tax-and-regulate bill as finalized by the conference below:
Photo courtesy of WeedPornDaily.