By John Schroyer
(This is the first in a two-part look at marijuana-related bills introduced in Congress this year. You can read the second article here.)
Less than three months into the new Congressional session, 13 bills have been introduced – including eight last Thursday – that would change the federal government’s approach to cannabis.
Democrats and Republicans in the House and Senate have proposed laws that range from allowing the states to continue charting their own
The Rohrabacher-Farr Amendment – which prohibits the DOJ from spending federal money to interfere with state medical marijuana laws – and similar potential amendments aren’t included on this list because they’re not stand-alone bills. Pro-cannabis amendments have previously been offered annually as attachments to the federal budget.
Here’s what’s been introduced this year:
H.R. 331: States’ Medical Marijuana Property Rights Act
- Prime sponsor: Rep. Barbara Lee, D-CA
- What it would do: “Amends the Controlled Substances Act to exempt real property from civil forfeiture due to medical marijuana-related conduct that is authorized by state law.”
- Business impact: The threat of civil forfeiture actions against legal MMJ businesses would likely be permanently removed. Civil forfeiture was a primary strategy used by former U.S. Attorney Melinda Haag in California and resulted in the closure of numerous MMJ companies.
H.R. 714: Legitimate Use of Medicinal Marijuana Act
- Prime sponsor: Rep. Morgan Griffith, R-VA
- What it would do: Move marijuana from Schedule 1 to Schedule 2 on the list of federally controlled substances, allow physicians to prescribe MMJ and empower states to continue regulating cannabis as they see fit.
- Business impact: This could be a double-edged sword for the cannabis industry. While moving marijuana to Schedule 2 would give companies more legitimacy in the eyes of the federal government and possibly help patient pools grow nationwide, such an action could also invite big companies – in the pharmaceutical, alcohol and tobacco industries – to begin taking over the cannabis trade.
H.R. 715: Compassionate Access Act
- Prime sponsor: Rep. Morgan Griffith, R-VA
- What it would do: Require the Department of Health and Human Services to send a recommendation to the Drug Enforcement Administration regarding rescheduling marijuana. The bill would also require the DEA to then issue another ruling on marijuana’s status as a controlled substance. It would also distinguish CBD from marijuana and deschedule CBD.
- Business impact: There likely wouldn’t be much impact on businesses, since the bill doesn’t require the DEA to reschedule marijuana and the agency declined to reschedule marijuana last August after considering input from Health and Human Services.
H.R. 975: Respect State Marijuana Laws Act
- Prime sponsor: Rep. Dana Rohrabacher, R-CA
- What it would do: “Amends the Controlled Substances Act to provide that (federal) penalties do not apply to a person who produces, possesses, distributes, dispenses, administers, or delivers marijuana in compliance with state laws.”
- Business impact: Essentially a version of the Rohrabacher-Farr Amendment, this measure is intended to empower states to take the lead on regulating cannabis without fear of reprisal from federal agents. If this bill were to be signed into law by President Trump, marijuana businesses would have nothing to fear from the Department of Justice or the DEA if they follow state law.
H.R. 1227: Ending Federal Marijuana Prohibition Act
- Prime sponsor: Rep. Tom Garrett, R-VA
- What it would do: Remove marijuana from the list of federally controlled substances but maintain a prohibition on shipping cannabis into states where it’s illegal.
- Business impact: This is probably one of the best-case scenarios for those who believe marijuana does not belong on the list of federally controlled substances. Under U.S. law, marijuana would be as legal to grow as carrots or tomatoes. However, state laws would still govern cannabis, so the cannabis businesses would rely on a patchwork of regulations that would vary greatly from state to state.
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The eight bills introduced last Thursday include three Senate measures and five House proposals. The bill packages in both chambers are essentially mirror images of each other, with the exception of H.R. 1820 (below) and one Senate bill that has been broken into two bills in the House.
Senate
S.776: Marijuana Revenue and Regulation Act
- Prime sponsor: U.S. Sen. Ron Wyden, D-OR
- What it would do: Establish a national tax on marijuana products that would start at 10% for the first two years and escalate 5 percentage points each year after that until the tariff tops out at 25% after five years. According to an analysis by MPP, many businesses – including producers and wholesalers – would have to obtain a permit from the U.S. Treasury.
- Business impact: Such a dramatic move by Congress would be arguably tantamount to federal legalization, since regulation and taxation equate to a formal thumbs-up among policymakers. The bill’s complex, wide-ranging effects would put the nation on a path to become the world leader in the emerging global cannabis industry.
S. 777: Small Business Tax Equity Act
- Prime sponsors: U.S. Sen. Ron Wyden, D-OR; Rand Paul, R-KY; and Michael Bennet, D-CO
- What it would do: Grant standard tax deductions to marijuana companies in compliance with state laws.
- Business impact: The versions of this bill in the Senate and the House bear the same name and would effectively repeal 280E for marijuana businesses that are state-licensed. The impact would be a much bigger legal profit margin for cannabis companies.
S. 780: Responsibly Addressing the Marijuana Policy Gap Act
- Prime sponsor: U.S. Sen. Ron Wyden, D-OR
- What it would do: Clarify that federal anti-marijuana laws do not apply to any person or business in compliance with state marijuana laws as well as Native American tribes. The bill includes a version of the Small Business Tax Equity Act and its essential repeal of 280E. It guarantees banking access for marijuana-related businesses by prohibiting federal regulators from punishing financial institutions for working with MJ companies. The expansive bill also includes other marijuana-related reforms that are outlined in MPP’s analysis.
- Business impact: This bill would be a dream come true for cannabis executives across the country. It would simultaneously grant tax and banking relief and also open new business opportunities for advertising and exploring emerging markets.
House
H.R. 1810: Small Business Tax Equity Act
- Prime sponsor: Rep. Carlos Curbelo, R-FL
- What it would do: Grant standard tax deductions to marijuana companies in compliance with state laws.
- Business impact: The versions of this bill in the Senate and the House bear the same name and would effectively repeal 280E for marijuana businesses that are state-licensed. The impact would be a much bigger legal profit margin for cannabis companies.
H.R. 1820: Veterans Equal Access Act
- Prime sponsor: Rep. Earl Blumenauer, D-OR
- What it would do: Allow physicians and medical workers at the U.S. Department of Veterans Affairs to recommend medical marijuana for military veterans.
- Business impact: Such a move could dramatically expand patient pools and therefore the customer base in many MMJ states.
H.R. 1823: Marijuana Revenue and Regulation Act
- Prime sponsor: Rep. Earl Blumenauer, D-OR
- What it would do: One of two House bills (along with H.R. 1841) that, together, make up Sen. Ron Wyden’s Senate bill, S. 776. It would establish a national tax on marijuana products, which would start at 10% for the first two years after the bill becomes law and escalate 5 percentage points each year after that until it tops out at 25% after five years. According to an analysis by MPP, many businesses – including producers and wholesalers – would have to obtain a permit from the U.S. Treasury.
- Business impact: See impact of S. 776, above.
H.R. 1824: Responsibly Addressing the Marijuana Policy Gap Act
Prime sponsor: Rep. Earl Blumenauer, D-OR
- What it would do: The House version of Sen. Ron Wyden’s Senate bill, S. 780. It would clarify that federal anti-marijuana laws do not apply to any person or business in compliance with state marijuana laws as well as Native American tribes. The bill includes a version of the Small Business Tax Equity Act and its essential repeal of 280E. It guarantees banking access for marijuana-related businesses by prohibiting federal regulators from punishing financial institutions for working with MJ companies. The expansive bill also includes a number of other marijuana-related reforms that are outlined in MPP’s analysis.
- Business impact: See impact of S. 780, above.
H.R. 1841: Regulate Marijuana Like Alcohol Act
- Prime sponsor: U.S. Rep. Jared Polis, D-CO
- What it would do: Require state-legal MJ companies to obtain a federal business permit from the U.S. Treasury Department. It would also put marijuana on the same federal regulatory footing as alcohol, including industry and product oversight by agencies like the U.S. Food and Drug Administration and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
- Business impact: While this bill would put marijuana largely on par with alcohol in the eyes of the federal government, it would also come with a host of new regulations and overseers that most every other industry must comply with. So, again, it’s a possible double-edged sword for MJ businesses.
John Schroyer can be reached at johns@mjbizdaily.com
