NEWS BRIEF

Marijuana trade groups offer comments on Schumer’s federal legalization bill

Several national marijuana trade organizations and activist groups submitted written comments about a draft of the most recent federal marijuana reform measure, highlighting the need for lower taxes and interstate commerce.

The formal comments, which were due to the U.S. Senate this week, offer 169 pages of feedback on the Cannabis Administration and Opportunity Act that’s being spearheaded by Senate Majority Leader Charles Schumer and Democratic Sens. Cory Booker and Ron Wyden.

The comprehensive reform bill would legalize marijuana on a federal basis by removing the plant from the Controlled Substances Act and allow states to continue to decide whether to prohibit or allow commercial sales.

Though every stakeholder group’s comments were effusively supportive of the bill at the macro level, they each had policy concerns.

“The regulatory aspects need significant clarification and revision to avoid unintended consequences that would derail the hard work states have done for decades,” Karen O’Keefe, the Marijuana Policy Project’s state policies director, summarized in a letter to senators.

Here are some of the highlights from the many comments:

  • The American Trade Association for Cannabis and Hemp wrote in a four-page letter that it has four key concerns ranging from specific federal regulations by the U.S. Food and Drug Administration, to the need for federal rules to work in connection with existing state marijuana markets, to hemp and CBD issues, to marijuana taxation.
  • The Coalition for Cannabis Policy, Education and Regulation’s 31-page letter expressed several areas of concern, including “removing criminality” of marijuana for both consumers and businesses as well as giving deference to state authorities on how cannabis companies should be governed. The group also suggested a phased implementation over several years for new marijuana industry rules to allow for as little market disruption as possible.
  • The Global Alliance of Cannabis Commerce wrote in a 29-page letter that it hopes a final bill will “expressly authorize” interstate commerce for existing state-legal marijuana companies, further amend federal law to facilitate interstate commerce and throw more federal funding behind programs that provide capital and technical assistance to small companies and disadvantaged entrepreneurs.
  • The Marijuana Policy Project wrote in a 12-page letter that while the bill is a good start, it doesn’t go far enough to both protect current MJ users and to right the wrongs done to consumers in the past. MPP also urged lawmakers to ease slowly into a new federally regulated system, with an “approach that starts with a framework of deference to states and includes a slow transition (and that) avoids burdens that will drive the market for cannabis products back underground.”
  • The National Cannabis Industry Association’s 31-page letter outlined a number of business concerns. The NCIA asserted that the proposed taxes in the draft bill would increase taxes overall on the industry, kill the option for small businesses to grow through vertical integration, create barriers to interstate commerce, increase compliance costs and doesn’t include any tax provisions for existing medical marijuana patients or businesses, thus “increasing cannabis-based healthcare costs.”
  • The National Organization for the Reform of Marijuana Laws wrote in a 21-page letter that the bill should “strengthen civic protections” for marijuana consumers, update employment policies with respect to drug testing, reduce “regulatory and tax burdens” for cannabis businesses so smaller operators can compete effectively with larger businesses, exempt medical marijuana markets from the proposed federal excise tax and balance the varying regulatory roles of federal agencies to minimize market disruption.
  • The United States Cannabis Council’s 41-page letter recommended that federal marijuana regulatory duties be split between the FDA and the Treasury Department. The group also recommended that federal MJ taxes have a brand-new taxing model with “rates that do not fuel the illicit market,” adding that any new regulatory regime needs to account for the various states’ patchwork of rules already in place as well as a sufficiently long transition time to give businesses plenty of runway to adapt.

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