Coming into 2020, policymakers in eight states expressed support for regulated medical or adult-use cannabis sales, and advocacy groups in nine states had efforts underway to include legalization on ballots in November. With cannabis already legal for medical use in 33 states; legal for medical and adult-use in 11 states; and more members of Congress – even those who previously opposed legalization – now supporting cannabis policy, state legalization agendas were moving quickly. But what was set to be a banner year for the cannabis industry has been slowed down by COVID-19. Nevertheless, COVID-19 has shown legal, regulated marijuana’s place as an “essential business,” even if state legislative activity may not come until 2021 or later. COVID-19 has shortened and reprioritized many states’ legislative sessions, eliminating time to hammer out crucial details of cannabis legalization laws, such as establishing a robust tax structure and ensuring compliance to decrease the illicit market. Already, at least five state legislatures considering legalizing cannabis in 2020 – such as New York – are expressing doubts they still can this year. In Arkansas, North Dakota, Missouri, Oklahoma, Idaho, and Nebraska advocacy groups had to pause efforts to gather ballot signatures due to social distancing rules. In Montana, a county district judge even ruled against using e-signatures in place of in-person signing. Additionally, cannabis legalization measures tend to appear on ballots during presidential election years – when voter turnout is higher – leaving legalization by vote efforts to 2024. The effects of the coronavirus pandemic cut both ways for the cannabis industry. Some businesses are cutting jobs, selling operations, are unable to remain open or are have constrained by social distancing rules, and are eligible for federal stimulus funds. Other cannabis businesses are resilient and have hired thousands of new employees across a half dozen states since the coronavirus began. In March, weekly sales topped $134 million in California, Washington, Nevada, and Colorado, a 17% increase from the weekly average in 2019. And Metrc’s track-and-trace data shows an almost 75% increase in system bandwidth usage since October 2019. Despite facing setbacks in the face of COVID-19, the cannabis industry still has economic potential for states looking to increase revenues and create news to pad budget shortfalls projected to reach $350 billion in 2021. While cannabis tax revenue would not cover all losses, it would help states build revenue in the coming years. For example, Colorado has raked in over $1.2 billion in legal cannabis revenue since 2014 and California’s legal cannabis market generated $635 million in state and local tax revenues in 2019.
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A bipartisan coalition of 34 state and territory attorneys general, including Massachusetts Attorney General Maura Healey, is urging Congress to pass coronavirus relief legislation that includes a provision to protect banks that serve marijuana businesses from being penalized by federal regulators. The case they lay out runs directly counter to seemingly coordinated statements by GOP lawmakers in opposition to the banking provision’s inclusion in legislation the Democratic-led House passed on Friday. In a letter to House and Senate leadership Tuesday, the top state law enforcement officials said there are three main reasons that providing the cannabis industry with banking access is especially necessary during the pandemic. First, the public safety threat of operating on a largely cash-only basis has been exacerbated amid the crisis. Second, large cash transactions “places law enforcement, tax regulators, consumers, and patients at heightened risk of exposure to the virus.” Third, access to financial institutions would make it easier to collect tax revenue from marijuana sales, which is particularly needed to offset economic shortfalls due to the health crisis.
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May 20, 2020
USDA Denies Coronavirus Benefits For Hemp Farmers But Later Seems To Reverse Reevaluation Block
The U.S. Department of Agriculture (USDA) announced on Tuesday that hemp growers are specifically ineligible for a coronavirus relief program it’s running. But hours after Marijuana Moment reported that the department also singled out hemp as being specifically ineligible for any reevaluation, the government removed that language from the initial notice. The stated reason for the crop’s exclusion is because it found hemp prices did not suffer a five percent or greater decline from January to April. USDA originally made the notable decision to exclude hemp as one of only two commodities that wouldn’t receive a reevaluation of eligibility even if “credible evidence” surfaced that the crop’s market did experience such declines. The other was tobacco. The list of ineligible commodities includes “sheep more than two years old, eggs/layers, soft red winter wheat, hard red winter wheat, white wheat, rice, flax, rye, peanuts, feed barley, Extra Long Staple (ELS) cotton, alfalfa, forage crops, hemp, and tobacco,” the department said in notice about its Coronavirus Food Assistance Program (CFAP). Initially USDA included this line in the notice: “However, for all commodities except for hemp and tobacco, USDA may reconsider the excluded commodities if credible evidence is provided that supports a five percent price decline.” Now the line has been revised to state: “USDA may reconsider the excluded commodities if credible evidence is provided that supports a five percent price decline.” CFAP is a $19 billion immediate relief program that “includes direct support to agricultural producers.” It was established as part of the first approved COVID-19 package passed by Congress. Hemp industry advocates have expressed disappointment over USDA’s action, arguing that like any other industry, the hemp market is experiencing unique challenges amid the pandemic and shouldn’t be written off from this program.
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May 19, 2020
Why Marijuana Legalization Hasn’t Ended Reefer Madness: The Los Angeles “Hash Oil Factory” That Isn’t
The cause of the enormous explosion and fire that destroyed a downtown Los Angeles building on Saturday evening and sent 12 firefighters to the hospital is not yet known. As for the effects, they were immediate, decisive — and entirely predictable. A culprit was identified even before arson investigators’ work could begun. The culprit, as initial media reports suggested, was cannabis, a theory that anti-legalization zealots amplified into a howl by Monday. By extension, that means the ongoing social experiment of marijuana legalization is the accomplice, and scenes like Saturday’s carnage in LA the logical conclusion for any other city or state pondering legal weed. This all sounds familiar, because it is. And though it may be weeks or longer before arson investigators piece together the actual cause, the lesson for drug-policy reform advocates and anyone in the cannabis industry is that baked-in anti-drug biases will take much longer than that to fade away — and you can do everything right and still suffer a setback in the information wars.
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May 19, 2020
34 Bipartisan Attorneys General Tell Congress To Pass Marijuana Banking As Part Of Coronavirus Bill
A bipartisan coalition of 34 state and territory attorneys general are urging Congress to pass coronavirus relief legislation that includes language protecting banks that service marijuana businesses from being penalized by federal regulators. The case they lay out runs directly counter to seemingly coordinated statements by GOP lawmakers in opposition to the banking provision’s inclusion in legislation the Democratic-led House passed on Friday. In a letter to House and Senate leadership on Tuesday, the top state law enforcement officials said there are three main reasons that providing the cannabis industry with banking access is especially necessary during the pandemic. First, the public safety threat of operating on a largely cash-only basis has been exacerbated amid the crisis. Second, large cash transactions “places law enforcement, tax regulators, consumers, and patients at heightened risk of exposure to the virus.” Third, access to financial institutions would make it easier to collect tax revenue from marijuana sales, which is particularly needed to offset economic shortfalls due to the health crisis.
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In a lackluster finish Sunday night to Minnesota’s scheduled legislative session, Senate Republicans voted to kill provision the House passed a day earlier that would have allowed medical marijuana patients to purchase raw, whole-plant forms of cannabis. The vote came as lawmakers left piles of unfinished business on the table ahead of an end-of-session deadline on Monday. Legislative leaders indicated they’ll be back for a special session June 12, but Senate Majority Leader Paul E. Gazelka (R) said that lawmakers will likely focus on bills “just for COVID-19.” In other words, patients and medical marijuana advocates will probably have to wait until this fall for another chance to overturn the state’s ban on marijuana flower. “Next year!” tweeted state Sen. Karla Bigham (DFL). “We got you!” Since Minnesota’s medical marijuana program launched in 2015, the state has banned sales of raw cannabis flower, allowing access to only extracts in the form of liquids, pills and vaporized oils. While supporters of the whole-plant ban say it’s a necessary step to prevent smoking, medical marijuana advocates argue the policy has driven up costs while limiting treatment options. An amendment to a health care omnibus bill approved by the House of Representatives on Saturday would have removed the prohibition on whole plant marijuana and specifically allowed for “raw cannabis.” But around noon on Sunday, the Senate voted to table that version of the omnibus bill after pushback from Senate Republicans. Hours later, senators passed a separate omnibus bill with the medical marijuana provision removed.
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There is one bright spot in the economy: marijuana sales. In April, Oregon saw $89 million in legal marijuana sales. The Oregon Liquor Control Commission reports marijuana sales were up 45% in April, compared to last year, making April 2020 the largest month on record for the state. Proponents believe the coronavirus pandemic could be the catalyst for other states and the federal government to legalize marijuana because it would bring tax revenue, create jobs and give the economy a much-needed shot in the arm. Oregon’s annual tax revenue from recreational marijuana sales exceeds $100 million. The state collects 17% tax on retail cannabis sales, while counties or cities can apply a 3% tax. Legal pot has provided a steady stream of tax revenue when other sources like personal income or state lottery revenues are less predictable due to the struggling economy and stay-at-home orders. Many cannabis dispensaries were deemed ‘esssential’ in many states, including Oregon, allowing them to remain open during government restrictions. “There’s a reason why over 25 states have declared marijuana dispensaries to be essential services. These are things people rely on,” explained Rep. Earl Blumenauer, D-Ore. While many businesses have reduced their workforce during the pandemic, proponents say legalizing pot nationwide could help create new jobs for many Americans. “Up until March there were almost a quarter-million people who worked in the industry,” said Blumenauer, a long-time advocate for marijuana legalization. Congress is already considering some reform, including marijuana banking laws.
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May 19, 2020
Why Marijuana Legalization Hasn’t Ended Reefer Madness: The Los Angeles “Hash Oil Factory” That Isn’t
The cause of the enormous explosion and fire that destroyed a downtown Los Angeles building on Saturday evening and sent 12 firefighters to the hospital is not yet known. As for the effects, they were immediate, decisive — and entirely predictable. A culprit was identified even before arson investigators’ work could begun. The culprit, as initial media reports suggested, was cannabis, a theory that anti-legalization zealots amplified into a howl by Monday. By extension, that means the ongoing social experiment of marijuana legalization is the accomplice, and scenes like Saturday’s carnage in LA the logical conclusion for any other city or state pondering legal weed. This all sounds familiar, because it is. And though it may be weeks or longer before arson investigators piece together the actual cause, the lesson for drug-policy reform advocates and anyone in the cannabis industry is that baked-in anti-drug biases will take much longer than that to fade away — and you can do everything right and still suffer a setback in the information wars.
Learn more
May 19, 2020
34 Bipartisan Attorneys General Tell Congress To Pass Marijuana Banking As Part Of Coronavirus Bill
A bipartisan coalition of 34 state and territory attorneys general are urging Congress to pass coronavirus relief legislation that includes language protecting banks that service marijuana businesses from being penalized by federal regulators. The case they lay out runs directly counter to seemingly coordinated statements by GOP lawmakers in opposition to the banking provision’s inclusion in legislation the Democratic-led House passed on Friday. In a letter to House and Senate leadership on Tuesday, the top state law enforcement officials said there are three main reasons that providing the cannabis industry with banking access is especially necessary during the pandemic. First, the public safety threat of operating on a largely cash-only basis has been exacerbated amid the crisis. Second, large cash transactions “places law enforcement, tax regulators, consumers, and patients at heightened risk of exposure to the virus.” Third, access to financial institutions would make it easier to collect tax revenue from marijuana sales, which is particularly needed to offset economic shortfalls due to the health crisis.
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In a lackluster finish Sunday night to Minnesota’s scheduled legislative session, Senate Republicans voted to kill provision the House passed a day earlier that would have allowed medical marijuana patients to purchase raw, whole-plant forms of cannabis. The vote came as lawmakers left piles of unfinished business on the table ahead of an end-of-session deadline on Monday. Legislative leaders indicated they’ll be back for a special session June 12, but Senate Majority Leader Paul E. Gazelka (R) said that lawmakers will likely focus on bills “just for COVID-19.” In other words, patients and medical marijuana advocates will probably have to wait until this fall for another chance to overturn the state’s ban on marijuana flower. “Next year!” tweeted state Sen. Karla Bigham (DFL). “We got you!” Since Minnesota’s medical marijuana program launched in 2015, the state has banned sales of raw cannabis flower, allowing access to only extracts in the form of liquids, pills and vaporized oils. While supporters of the whole-plant ban say it’s a necessary step to prevent smoking, medical marijuana advocates argue the policy has driven up costs while limiting treatment options. An amendment to a health care omnibus bill approved by the House of Representatives on Saturday would have removed the prohibition on whole plant marijuana and specifically allowed for “raw cannabis.” But around noon on Sunday, the Senate voted to table that version of the omnibus bill after pushback from Senate Republicans. Hours later, senators passed a separate omnibus bill with the medical marijuana provision removed.
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