Industry, activists push legalization priorities

By Alex Halperin
Feb 12, 2021
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A consensus is emerging that equity measures to atone for the war on drugs should be included in the cannabis legalization efforts under consideration in Congress. However, as social justice advocates and industry jostle for position, it remains unclear what kind of bill can win the likely 60 votes necessary to pass the evenly split U.S. Senate.  

Queen Adesuyi, national affairs policy manager at the non-profit Drug Policy Alliance, said the group supports “comprehensive” social justice reform as included in the Marijuana Opportunity Reinvestment and Expungement Act (The MORE Act), which passed the U.S. House of Representatives in a bipartisan December vote.  

In addition to descheduling cannabis from the controlled substances act and enabling states to determine their own marijuana laws, the MORE Act includes provisions to: 

  • Create a national cannabis sales tax to benefit communities negatively impacted by the war on drugs
  • Expunge federal cannabis offenses
  • Prohibit the denial of federal benefits or protections granted by immigration laws for cannabis offenses  

In a February 1 statement, Senators Cory Booker (D-N.J.), Ron Wyden (D.-Ore.) and Majority Leader Chuck Schumer (D-N.Y.) who are collaborating on a bill to end prohibition, committed to social equity measures as a component of legislation. 

  • Days later, Sen. Sherrod Brown (D-Ohio), who chairs the banking committee, said legislation which would grant cannabis companies access to the financial system — a top industry priority for years — had to be coupled with sentencing reform for federal drug offenses.

This week, a new group called the United States Cannabis Council (USCC) launched with members including advocacy organizations and some of the largest American and Canadian cannabis companies. While not all of the participating companies have incorporated restorative justice in their operations to date, the group calls for cannabis legislation to include “social justice & equity measures” alongside unspecified “common sense” regulations of the industry.  

In a Tuesday interview with WeedWeek, USCC interim CEO Steven Hawkins described the group as a vehicle for disparate elements of the cannabis world to make a unified push for legalization. He declined to elaborate on specific policy priorities. (Hawkins is also the executive director of the Marijuana Policy Project, a pro-legalization group with longstanding ties to the industry.) 

Most observers consider federal legalization inevitable. But when it happens and the exact provisions of the law are potentially high stakes variables for many operators, including some members of the USCC.

DPA’s Adesuyi suggested USCC’s members are attempting “to rebrand and connect themselves with social equity and justice reform, which are the two frameworks which have successfully” advanced legislation.

“They may feel that they’ll be left behind if they don’t rebrand,” she said. (USCC didn’t respond to a request for comment late on Friday.)

  • In a recent interview with WeedWeek, Stephen Miles, CEO of Sharp Capital Advisors, a firm which advises cannabis companies on mergers and acquisitions, said big multi-state operators (MSOs) stand to benefit from a more drawn out legalization process, since it would allow them to grow without competition from liquor, tobacco and other mainstream companies.  

Though she comes from a very different perspective, Adesuyi echoed the sentiment that some companies “benefit from the discrepancy between federal and state law.” 

What’s “common sense?”

In interviews, Hawkins has been reticent to detail USCC’s “common sense” priorities for cannabis regulation. Some possibilities for state and federal law, such as caps on the number of licenses and requiring companies to be vertically integrated, could benefit the MSOs which make up a sizable contingent of its membership, potentially at the expense of smaller companies. 

But common sense might also refer to policies that have near universal support from industry and activists.

Garrett Graff, managing partner at Hoban Law Group, said the federal legislative process could produce rules that would cause widespread consternation throughout the cannabiz. (His comments are general and do not reflect USCC’s views.)

For example, the MORE Act would deschedule cannabis from the Controlled Substances Act, enabling it to be regulated in a way similar to alcohol and tobacco. However, re-scheduling cannabis from its current schedule I status, to a less stringent classification, could cause broad disruption within the existing state-legal industries. 

During the presidential campaign, candidate Joe Biden floated rescheduling. Graff said it might also be favored by some within the pharmaceutical industry.    

Similarly, the legislative process has the potential to surface ideas that would overhaul or undermine the existing state markets over the objections of just about everyone invested in them, including thousands of companies.

As lawmakers craft the bill, they’re likely to solicit input from other industries and federal agencies, and “that’s where disruption occurs,” Graff said.