Politics
Why Pro-Legalization Cory Booker Isn’t Cosponsoring The New Marijuana Bill
Sen. Cory Booker (D-NJ) is in presidential campaign mode, and he’s made marijuana reform a critical tenet of his platform. So why isn’t he cosponsoring new bipartisan legislation to shield legal cannabis states from federal intervention that was introduced in Congress last week?
The senator signed on to an earlier version of the bill that was filed last year. And he’s repeatedly said that states should be granted the autonomy to set their own marijuana policies. That would be accomplished under the proposed bill, yet he declined to add his name as an original cosponsor of the Strengthening the Tenth Amendment Through Entrusting States (STATES) Act.
The reasoning behind his decision was unclear until Tuesday, when Booker told VICE’s Matt Laslo that he’s withholding his support because the bill doesn’t go far enough in terms of repairing the racially disproportionate harms of prohibition.
“At this point it’s too obvious and urgent and unfair that we’re moving something on marijuana on the federal level and it doesn’t do something on restorative justice,” he told VICE. “I want that bill to have some acknowledgement of the savage injustices that the marijuana prohibition has done to communities.”
“I get very angry when people talk about legalizing marijuana and then give no light to how marijuana law enforcement was done in ways that fed upon poor communities—black and brown communities. This is a war on drugs that has not been a war on drugs—it’s been a war on people, and disproportionately poor people and disproportionately black and brown people.”
Listening to the 2020 Democratic candidate talk about his drug reform philosophy of late reveals something of a shift—one that places greater weight on social equity—and Booker seems to be indicating that the STATES Act doesn’t meet his standard for reform.
“We fundamentally have laws in this country that have treated people differently,” Booker said in separate comments last month. “I’m hoping all of us when we talk about marijuana legalization or marijuana decriminalization, in the same breath we’ve got to talk about expunging the records of everyone who is still suffering.”
Under the senator’s own Marijuana Justice Act, federal courts would have to expunge the records of individuals with convictions for possessing or consuming cannabis. It would go further too, by federally descheduling cannabis and penalizing states that enforce marijuana laws in a racially or socioeconomically disproportionate way by withholding certain federal funds. And that saved money would go toward community reinvestment efforts such as job training programs.
“Senator Booker is right that for any marijuana legalization bill to pass Congress, it must have robust racial justice provisions,” Michael Collins, director of national affairs for the Drug Policy Alliance, told Marijuana Moment. “We need to take steps to right the wrongs of the war on drugs, and we hope that more members of Congress will embrace Booker’s position.”
It’s already apparent that Booker is working to distinguish himself from the current crowd of pro-legalization Democratic presidential hopefuls. For example, he seemed to make a veiled critique of Sen. Kamala Harris (D-CA) after she made a lighthearted admission that she used marijuana during college.
“We have presidential candidates and congresspeople and senators that now talk about their marijuana use almost as if it’s funny,” he said last month. “But meanwhile, in 2017, we had more arrests for marijuana possession in this country than all the violent crime arrests combined.”
During that same campaign stop, Booker also said “do not talk to me about legalizing marijuana unless in the same breath you talk to me about expunging the records of the millions of people that are suffering with not being able to find a job,” touting his legislation.
Booker’s criticisms of what he sees as the inadequacies of the STATES Act, which was filed by competing presidential candidate Sen. Elizabeth Warren (D-MA), could provide another way for the senator to separate himself from the pack in the race—though Warren and Harris, along with other contenders, have also signed on as cosponsors of his Marijuana Justice Act.
The STATES Act is a relatively non-controversial, bipartisan bill, as far as cannabis reform in Congress goes. It has a states’ rights focus that has appealed to even some historically anti-marijuana lawmakers like Rep. Doug Collins (R-GA), who endorsed the legislation in a letter to the chair of the House Judiciary Committee.
“[I]t sounds like I need to talk to Cory Booker about fixing a federal-state conflict,” Sen. Cory Gardner (R-CO), the chief Republican cosponsor of the Senate version of the STATES Act, told VICE. “This is about fixing a conflict in federal and state law that needs to be done, and it’s pretty simple. So I think he would be hard pressed to vote against it.”
To be clear, while Booker is withholding his name as a cosponsor of the bill, he hasn’t said he would vote against it—a prospect that would almost certainly sink its chances of clearing the Judiciary Committee, of which he is a member, if brought up for consideration there.
In the 116th Congress, the STATES Act also seems to have revealed additional political schisms in marijuana policy within the Democratic party. Sen. Dianne Feinstein (D-CA) removed her name from the original cosponsors list after supporting the last version, for instance, but advocates suspect that that decision reflects what they see as the senator’s disingenuous prior support, which came in the midst of a re-election battle with progressive challenger, state Sen. Kevin de Leon (D).
Sen. Dianne Feinstein Signs Onto Marijuana Bill After Decades Of Drug War Advocacy
Photo courtesy of Senate Democrats.
The plan to federally legalize marijuana is well underway, Rep. Earl Blumenauer (D-OR) said in a new interview. But it’d be moving a lot quicker if it weren’t for distractions emanating from the president’s Twitter account, he joked.
Blumenauer gave a status update on his plan to end federal cannabis prohibition during a Sunday KATU-TV interview in which he was asked whether he felt Congress was still on track to legalize marijuana by year’s end.
“We are in really great shape. We’ve had a number of votes in the House. The things I’ve put in the blueprint are moving forward,” the congressman said, adding that the Judiciary Committee held a major hearing on legalization legislation in July.
Blumenauer issued a memo to his party’s leadership last year—which he called a “blueprint”—in which he laid out a step-by-step plan by which House committees could advance incremental cannabis legislation while building up to the eventual federal legalization of marijuana by the end of 2019.
“We’ve got things keyed up. I think there’s a great chance of doing it this Congress—maybe even this fall—depending on how crazy things get,” he said in the TV interview.
“Every time I turn around, there’s some other national catastrophe or Trump is out there with Twitter storms,” he cautioned. “It’s not a manageable situation, but the issues dealing with cannabis are on the right track.”
“We can get it wrapped up this Congress, maybe even this year.”
Watch Blumenauer’s marijuana comments, starting at about 9:35 into the video below:
While the 116th Congress is by many measures the most cannabis friendly in history, advocates hoped that reform legislation would move more expeditiously, especially in the Democratic-controlled House.
I recently spoke with @BrianWoodKATU on Your Voice Your Vote about some pressing issues: gun violence, my visit to the southern border, healthcare reform, cannabis legalization, the housing crisis, and more…https://t.co/Nb2V2a13Q4
— Earl Blumenauer (@repblumenauer) August 19, 2019
For example, a bipartisan bill that would protect banks that service marijuana businesses from being penalized by federal regulators cleared the House Financial Services Committee in March, but it didn’t get a full House floor vote before the August recess like advocates anticipated.
That said, companion legislation did get a somewhat unexpected hearing in the Senate Banking Committee even after the panel’s chair indicated it wouldn’t advance as long as cannabis remains federally illegal.
Blumenauer also said in the interview that voters are ahead of Congress on the issue, moving forward with state-level legalization efforts while legislative action on Capitol Hill crawls ahead. And beyond the U.S.’s border, the congressman mentioned that Mexico will be implementing legalization this fall.
Bernie Sanders Calls For Legalization Of Marijuana And Safe Injection Sites
Photo courtesy of KATU 2.
A federal financial agency released updated guidelines on banking in the hemp industry on Monday, following up on requests from multiple lawmakers to provide clarity on the issue.
The National Credit Union Administration (NCUA) said in its interim guidance that providing banking services to hemp businesses is allowable since the crop and its derivatives were federally legalized under the 2018 Farm Bill. The notice also emphasized the economic potential of hemp and the role credit unions can play as the industry continues to develop.
“Lawful hemp businesses provide exciting new opportunities for rural communities,” NCUA Chairman Rodney Hood said in a press release. “I believe today’s interim guidance keeps with the mission of the nation’s cooperative credit system to serve people who have been overlooked and underserved.”
“Many credit unions have a long and successful history of providing services to the agriculture sector,” he said. “My expectation is that credit unions will thoughtfully consider whether they are able to safely and properly serve lawfully operating hemp-related businesses within their fields of membership.”
Growth in hemp-related commerce will create a need for capital & financial services. Interim guidance gives #creditunions the ability to step in & provide hemp-related businesses these customary financial services. Learn more: https://t.co/otTzUt3tL7
— The NCUA (@TheNCUA) August 19, 2019
#creditunions will be able to provide the customary range of financial services for business accounts, including loans, to hemp businesses within their fields of membership https://t.co/5xVnkF3C3E.
— The NCUA (@TheNCUA) August 19, 2019
In a letter sent to Sen. Michael Bennet (D-CO) last month, which the presidential candidate’s Senate office shared exclusively with Marijuana Moment, Hood noted that NCUA was “working on possible future guidance to financial institutions” but that such guidance would be subject to change depending on what regulations the U.S. Department of Agriculture (USDA) ultimately develops.
In the meantime, the new interim guidance notes that “growth in hemp-related commerce could provide new economic opportunities for some communities, and will create a need for such businesses to be able to access capital and financial services” while clarifying that credit unions “may provide the customary range of financial services for business accounts, including loans, to lawfully operating hemp related businesses within their fields of membership.”
While NCUA said that it is “generally a credit union’s business decision as to the types of permissible services and accounts to offer,” it highlighted the need to comply with the Bank Secrecy Act (BSA) and with Anti-Money Laundering (AML) requirements, in particular:
—Credit unions need to maintain appropriate due diligence procedures for hemp-related accounts and comply with BSA and AML requirements to file Suspicious Activity Reports (SARs) for any activity that appears to involve potential money laundering or illegal or suspicious activity. It is the NCUA’s understanding that SARs are not required to be filed for the activity of hemp-related businesses operating lawfully, provided the activity is not unusual for that business. Credit unions need to remain alert to any indication an account owner is involved in illicit activity or engaging in activity that is unusual for the business.
—If a credit union serves hemp-related businesses lawfully operating under the 2014 Farm Bill pilot provisions, it is essential the credit union knows the state’s laws, regulations, and agreements under which each member that is a hemp-related business operates. For example, a credit union needs to know how to verify the member is part of the pilot program. Credit unions also need to know how to adapt their ongoing due diligence and reporting approaches to any risks specific to participants in the pilot program.
—When deciding whether to serve hemp-related businesses that may already be able to operate lawfully–those not dependent on the forthcoming USDA regulations and guidelines for hemp production–the credit union needs to first be familiar with any other federal and state laws and regulations that prohibit, restrict, or otherwise govern these businesses and their activity. For example, a credit union needs to know if the business and the product(s) is lawful under federal and state law, and any relevant restrictions or requirements under which the business must operate.
“Hemp provides new opportunities for communities with an economic base involving agriculture,” the notice states. “The NCUA encourages credit unions to thoughtfully consider whether they are able to safely and properly serve lawfully operating hemp-related businesses within their fields of membership.”
“Lending to a lawfully operating hemp-related business is permissible.”
After USDA releases its rules for the hemp industry, which are expected to come ahead of the 2020 planting season, NCUA said it “will issue additional guidance on this subject.”
Senate Majority Leader Mitch McConnell, who like Bennet has also pressured federal regulators to clear up confusion around hemp banking, took credit for NCUA’s response and celebrated the new guidance.
At @senatemajldr’s request, @TheNCUA issues guidance to assist legal #hemp industry. Hearing concerns from his constituents, McConnell urged NCUA to provide clarification to help address this barrier in #Kentucky. @KYCreditUnions applauds the positive news https://t.co/5kaQmxJE1x
— Senator McConnell Press (@McConnellPress) August 19, 2019
“I’m delighted to hear the NCUA has answered my call on behalf of Kentuckians to ensure the legal hemp industry can access much-needed financial services,” McConnell said in a press release. “Although President Trump signed into law my initiative last year to remove hemp from the federal list of controlled substances, many of my constituents have told me about their difficulty receiving loans and other services that are necessary to successfully run a hemp business.”
“Through this guidance by the NCUA, I look forward to more hemp farmers, processors and manufacturers starting or growing their operations with the help of Kentucky’s credit unions,” he said. “As Senate Majority Leader, I’ll continue advocating for Kentucky’s priorities throughout the federal government, and I’m proud of today’s positive news.”
Credit unions have generally been friendlier to the marijuana and hemp industries than have conventional banks, and NCUA has similarly taken a more proactive role in evolving to meet the demands of these burgeoning markets.
For example, the agency’s head clarified earlier this month that credit unions wouldn’t be punished simply for serving hemp businesses so long as they were following standard procedures. NCUA also released a draft rule in July that would allow people with past drug convictions to work at credit unions.
Cannabis banking issues have received significant congressional attention this session, with a bipartisan consensus emerging around creating a legislative fix so that hemp and marijuana businesses are able to access financial services.
The hemp industry in particular has enjoyed bipartisan support since the crop was legalized, but while marijuana remains a federally controlled substance, more lawmakers from across the aisle are expressing interest in affording cannabis businesses the same access in order to increase financial transparency and mitigate public safety risks associated with operating on a largely cash-only basis.
The House Financial Services Committee approved a bill in March that would protect banks that service marijuana businesses from being penalized by federal regulators, and the Senate Banking Committee also held a hearing on the issue last month.
Banking Chairman Mike Crapo (I-ID), who suggested earlier this year that his panel wouldn’t convene to discuss the matter as long as cannabis is federally illegal, has since taken a stance that the issue needs to be resolved.
But while advocates hoped that legislation to address marijuana banking problems would be taken up by the full House ahead of the August recess, that window closed and attention is now turned to a potential hearing in the fall.
Five Federal Agencies Respond To Presidential Candidate’s Hemp Banking Letter
Photo courtesy of Brendan Cleak.
The marijuana legalization movement is often described as a state-level experiment—and one aspect of its implementation that’s garnering more attention is how legalized jurisdictions approach cannabis taxes in different ways.
Pew Charitable Trusts has been monitoring taxation in the legal industry and released a report on Monday that explains the challenges of establishing effective tax schemes and accurately projecting revenues, especially considering that experts don’t have a sizable body of historical data on which to base predictions like they do for alcohol and tobacco.
That said, there are some lessons to be taken from recent years since early legalizers implemented their respective programs.
Because tax rates differ significantly for marijuana businesses and consumers depending on the state, revenue from cannabis sales has varied, leaving policymakers in a flux as they work to meet budget goals and predict future trends, Pew reported.
Revenue was 40 percent higher in the first six months of sales than Nevada anticipated, for example, while sales in California were 45 percent lower than initially projected.
Here’s a breakdown of marijuana tax revenue in five adult-use states:Â
Via Pew.
Pew also observed that revenue growth is slowing in Colorado and Washington, the first states to legalize for recreational use, as the market evolves.
Via Pew.
Marijuana tax revenue growth in Washington state https://t.co/kknH2amoCS
• 2015 to 2016: 277%
• 2016 to 2017: 70%
• 2017 to 2018: 17% pic.twitter.com/BA2stA5qiw— Pew States (@PewStates) August 19, 2019
“Supporters of legalizing recreational marijuana expected a new revenue source for states, but market uncertainties continue to challenge revenue forecasters and policymakers,” Pew concluded. “The difficulty in forecasting revenue is compounded by the fact that states have only recently begun to understand the recreational marijuana market: the level of consumer demand for recreational marijuana products, the types of users and how much they might pay for the drug, and competition with the black market.”
“States have learned some lessons but continue to grapple with unknowns.”
In order to prevent budget shortfalls that could impact funding for certain programs, policymakers should take caution and bear in mind the differences “between marijuana revenue’s short-term growth and long-term sustainability.”
“While these new dollars can fill immediate budget needs, they may prove unreliable for ongoing spending demands,” Pew said. “Policymakers should look to other, more familiar sin taxes for lessons on how to manage marijuana tax revenue most effectively.”
Federal Health Agency Releases List Of Marijuana Research Priorities
Photo courtesy of WeedPornDaily.
