House Rules Committee Weighs In On Cannabis Appropriations Amendments
By Morgan Fox, NCIA’s Director of Media Relations
The process of approving the federal budget is moving full steam ahead, with the House Rules Committee considering several amendments related to cannabis to a series of funding bills this week. Amendments that pass this committee move on to a full vote on the House floor.
In terms of overall cannabis policy reform, the most prominent amendment is one that would prevent the Department of Justice from using funds to interfere with state adult-use and medical cannabis programs or target people and businesses that are in compliance with state cannabis laws. This amendment was offered by bipartisan congressional cannabis champions Reps. Earl Blumenauer (D-OR), Tom McClintock (R-CA), Eleanor Holmes Norton (D-DC) and Barbara Lee (D-CA). The amendment was ruled in order Wednesday and will proceed to a vote, possibly as soon as this week.
Even though the DOJ has generally been respecting state cannabis laws in recent years, passage of this amendment in the final federal budget would add the force of law to that policy for the next fiscal year, providing peace of mind for tens of thousands of regulated cannabis businesses and millions of consumers across the country. This would also add significant momentum to congressional efforts to remove cannabis from the schedule of controlled substances and regulate it at the federal level in separate stand-alone legislation.
Provisions to prevent the DOJ solely from targeting state-legal medical cannabis programs and providers have been approved by Congress every year since 2014. With public support for medical cannabis at roughly 90%, these protections have become mostly a non-issue in Congress and have been included in the original base language of the relevant House appropriations bills since 2019.
The amendment extending those protections to state adult-use programs was approved by the House in the budget votes in 2019 and 2020. Unfortunately, it did not receive the same support in the Senate and was not included in the final funding packages approved by the previous Congress.
An amendment that would remove the renewal of medical cannabis program protections from this legislation, flying in the face of long-supported policy and unnecessarily taking up lawmakers’ time, was also introduced by Rep. Doug LaMalfa (R-CA) and ruled in order.
Rep. LaMalfa, a staunch prohibitionist, has also introduced several amendments to appropriations bills to increase DEA funding for eradication efforts. He made headlines recently when his office released videos of him joining law enforcement in bulldozing outdoor cultivation sites in Siskiyou County, California while grandstanding for the camera and ripping off quotes from the film Apocalypse Now. These sites were located in primarily Hmong communities, a Southeast Asian ethnic diaspora that alleges that the county has prevented its members from obtaining cannabis licenses and prevented water shipments to their communities with serious harm to the quality of life there. LaMalfa’s behavior in these videos is particularly offensive given that many Hmong fled their homes to settle in the United States during and following the Vietnam War after facing persecution for supporting America in that conflict.
Unfortunately, some positive cannabis amendments were ruled out of order by the committee this week and will not be voted upon in this legislation. Delegate Norton offered a pair of provisions that would have prevented the Dept. of Housing and Urban Development from using funds to punish residents of federally assisted housing for state-legal cannabis use in adult-use and medical states, respectively. These reforms are incredibly important, as people living in federal housing can be and are frequently evicted from their homes if they or anyone in their household exercises their legal rights or uses the medicine that works best for them. This leaves many people with no place to legally use cannabis, leading to increased public consumption in low-income communities and continued racial disparities in arrests and citations.
On the positive side, an amendment from Rep. Kurt Schrader (D-OR) to highlight the need for the Food and Drug Administration to establish regulations for CBD products was also ruled in order and approved.
Last week, another bad amendment, introduced by Rep. Debbie Lesko (R-AZ), to remove language from the original legislation that would allow federal funding for universities that are conducting cannabis research was ruled in order but voted down in the House.
The House appropriations bills have a broad range of other cannabis provisions related to topics like banking reform, research, law enforcement funding and grant programs, federal employment guidelines, and allowing the District of Columbia to finally regulate cannabis after it was legalized by voters in 2014. We’ll get into these in more detail in the coming weeks as we get closer to a full vote in the House. Stay tuned!
A Different Kind Of Season: Gearing Up For Appropriations
by Morgan Fox, NCIA’s Director of Media Relations
It’s that time again on Capitol Hill: appropriations season, when Congress determines how to spend – or not spend – your tax dollars for the next year. As you can imagine, this year will be unlike any in recent memory as a cash-strapped nation struggles with how to weather the economic storm caused by the pandemic while finding the funds to support important government functions and programs. Appropriations are also a time when our champions in the legislature are once again introducing sensible cannabis policy reforms through an avenue that historically has been effective. Many of these reforms would actually save taxpayers money!
What’s in:
For the second year in a row, language that prevents the Department of Justice from using resources to target state-legal medical cannabis programs was included in the original language of the commerce, justice and science funding bill. If approved or continued, this would be the sixth year that Congress has told federal law enforcement to leave medical cannabis patients and providers alone.
Language that would prevent the Department of Treasury from using resources to penalize banks and other financial institutions for working with legal cannabis businesses was included in the financial services and general government funding bill. While not as comprehensive as the SAFE Banking Act, which was approved by the House last year and included in its most recent coronavirus relief bill, this provision would give financial services providers more assurances needed to encourage working with the cannabis industry and would help improve public health and safety.
A measure that would protect public colleges and universities from being denied federal funds due to conducting research on cannabis was included in the bill funding agencies related to education, labor, health, and human services. Many institutions have cited the potential loss of funding as a major discouragement to research. This also makes it easier for universities to study cannabis products available in regulated state markets. An additional provision to this bill also prevents federally funded schools from engaging in any advocacy in support of making any Schedule I substances legal.
Additional funding would be made available through the agriculture and FDA appropriations legislation for research, regulation, and consumer protection related to hemp, CBD, and other cannabis components.
Language that asks the Office of Personnel Management to reconsider allowing federal employees to legally consume cannabis in accordance with applicable state laws without fear of retribution was added to the financial services and general government funding bill. While this is non-binding, it would hopefully encourage the federal government to review its employment practices and not punish law-abiding employees who choose to use cannabis outside of work.
What’s not:
A provision that has prevented the District of Columbia from regulating cannabis after voters there approved a ballot initiative making adult use legal in 2014 was left out of the new spending package. So long as it is not added again in either the House or Senate, the nation’s capital will finally be able to fully carry out the intent of the voters more than half a decade after residents decided this issue. Currently, adult possession and limited home cultivation are permitted in the District, but non-medical sales are not.
What could be added:
While the spending bill that funds the Department of Veterans Affairs did not originally contain any cannabis-related provisions, supporters are leaving open the possibility that language which would allow doctors in the VA system to recommend medical cannabis to their patients in accordance with state laws to be included before the process is complete.
Reps. Earl Blumenauer (D-OR) and Tom McClintock (R-CA), joined by Delegate Eleanor Holmes Norton (D-DC), are considering the introduction of a rider which would prevent the Department of Justice from interfering in any state cannabis program, extending the previously-approved protections for medical cannabis programs to regulated adult-use systems that exist in 10 states and counting. This legislation was approved in last year’s House spending bills but was not included in the final legislation.
It is difficult to tell what will happen with the various appropriations bills this session. There is still time for members of the House to amend funding legislation. While the House is moving forward with these bills, the Senate has yet to introduce any of their own. However, the upper chamber is in the process of considering a new coronavirus relief package. NCIA has been working with that chamber to have cannabis banking reform language included in that bill as it was in the last relief bill approved by the House, but it is by no means certain at this point. It is also possible that Congress won’t reach an agreement on the new spending bills and will simply decide to continue with the prior year’s budget outlays, which would at least continue medical cannabis protections for another year.
Stay tuned for more updates and be sure to join us next Wednesday, July 29, for an exclusive members-only fireside chat with NCIA’s dedicated government relations team!
Webinar Recording: All Gave Some, Some Gave All – A Policy Discussion on the Veterans Cannabis Conundrum
In case you missed this webinar on Memorial Day, watch this recording.
Especially around Memorial Day, it’s important to remember the reason for the holiday: our veterans. Unfortunately, though all gave some and some gave all, the vast majority of our veterans are still unable to access safe, regulated cannabis. Many individuals in the veteran community struggle under unique health burdens stemming from their honorable service, and have experienced little success in managing their conditions with available pharmaceuticals. Through cannabis, veterans of all generations and with various conditions have experienced improvements in their quality of life by using cannabis.
In Congress, two bills aimed at tackling this issue have already passed out of the House Veterans Affairs Committee — H.R. 712: the VA Medicinal Cannabis Research Act of 2019, sponsored by Congressman Lou Correa (D-CA) and H.R. 1647: the Veterans Equal Access Act, sponsored by Congressman Earl Blumenauer (D-OR). In March, the Congressional Budget Office scored H.R. 1647 and found that passing the bill into law would cost the federal government exactly $0.
Enjoy this webinar focused on cannabis, health, and our armed services members. NCIA’s Government Relations team is joined by none other than the lead sponsors of the VA Medicinal Cannabis Research Act of 2019 and H.R. 1647: the Veterans Equal Access Act, Congressmen Lou Correa and Earl Blumenauer, respectively. Our panel also includes the cofounders of the Veterans Cannabis Coalition, Eric Goepel and Bill Ferguson. This unique opportunity will allow you to hear from the lead sponsors of legislation designed to give our veterans the best quality of life possible, interact with member(s) of Congress, and learn more about the prospects of these bills passing into law.
Action Alert: Tell Congress To Include Cannabis In The Next COVID-19 Relief Bill!
While we all continue to do our jobs to flatten the curve in the age of COVID-19, our lobbying team in D.C. has been hard at work on your behalf. We have been working every angle and are exploring any and all opportunities to provide relief for our industry.
The offices of Congressman Blumenauer (D-OR) and Senator Jacky Rosen (D-NV) have taken the lead on sending a letter to congressional leadership asking that they address the exclusion of state-legal cannabis and ancillary businesses from the recently passed CARES Act. But now, we need your help.
In order for these letters to be seriously considered by congressional leadership, we need to get as many members of Congress to sign on as possible. Please consider calling your representative and Senators today and ask them to sign on to the appropriate letter. You can find your member of Congress and how to contact them here.
“Hi, I am calling/writing today to ask that you sign onto Congressman Blumenauer/Senator Rosen’s letter to leadership. This letter asks that state-legal cannabis businesses have access to Small Business Administration programs to ensure they have the financial capacity to undertake the public health and worker-focused measures experts are urging businesses to take. This current lack of access will undoubtedly lead to unnecessary layoffs, reduced hours, pay cuts, and furloughs for the workers of cannabis businesses who need support the most. As your constituent, I ask and urge that you sign on to Congressman Blumenauer/Senator Rosen’s letter as soon as possible. Our industry, our businesses, and our employees cannot wait.“
Canada Legalizes Cannabis – When Will The U.S. Follow?
by Rachelle Lynn Gordon, NCIA Editorial Staff
On June 19, Canada became the first G7 nation and second in the world after Uruguay to fully legalize cannabis for adult use, paving the way for what is estimated to be a CAD$9.2 billion dollar industry by 2025. Canadian Prime Minister Justin Trudeau Tweeted in response to the move:
“It’s been too easy for our kids to get marijuana – and for criminals to reap the profits. Today, we change that. Our plan to legalize & regulate marijuana just passed the Senate. #PromiseKept”
The passing of the iconic Bill C-45, also known as the Cannabis Act, was met with raucous applause from the across the globe and sent marijuana stocks soaring. Provinces and territories now have until October 17 to develop and implement their own regulations for the sale of cannabis products; according to the federal statute, adults will be able to carry and share up to 30 grams of marijuana in public and cultivate up to four plants at home.
But when will the United States follow suit and become a part of the multi-billion dollar global cannabis market?
High Time for Federal Legalization
“With leading policymakers on both sides of the aisle calling for reform, there has never been more momentum behind the effort to replace criminal marijuana markets with regulated businesses, but we still have a long way to go.” says Aaron Smith, executive director for the National Cannabis Industry Association (NCIA).
Despite the fact that 29 states, as well as Guam, Puerto Rico, and the District of Columbia, have legalized cannabis for medical and/or adult-use, the plant is still illegal at the federal level. This has led to immense headaches for business owners within the legal space who only wish for their companies to thrive but are hindered by lack of access to traditional banking and fundraising opportunities and stuck operating within individual state lines.
Lawmakers from legal states have heard their constituents’ voices loud and clear and have joined together to develop the STATES Act, short for “Strengthening the Tenth Amendment Through Entrusting States.” Introduced by Senators Elizabeth Warren (D-MA) and Corey Gardner (R-CO), the bill aims to protect states that choose to legalize cannabis by creating an exemption to the U.S. Controlled Substances Act, and would remove industrial hemp from the Controlled Substances Act entirely. The bill would also allow banks to work with cannabis businesses more easily. Representatives David Joyce (R-OH) and Earl Blumenauer (D-OR) have already introduced a companion bill in the House.
When asked about the STATES Act by reporters, President Trump replied that he would more than likely support the measure, stating: “I support Sen. Gardner, I know exactly what he’s doing. We’re looking at it. But I probably will end up supporting that, yes.”
Full Legalization Needed for Market to Thrive
Adopting a federalist approach on the issue of cannabis law reform will certainly mean that individual states will be allowed to flourish, but it stops short of the immense financial opportunities that federal legalization could bring.
“The cannabis industry is vibrant and expanding rapidly, but until the threat of federal interference is removed, our economic potential is limited,” said Aaron Smith, NCIA. “Lack of access to financial services, exorbitant tax pressures, and the absence of interstate and international commerce are all problems that we can fix by turning up the pressure on Congress.”
U.S.-based companies and investors are missing out on huge financial investment opportunities due to cannabis’ current status as a Schedule I controlled substance. According to a recent white paper released by NCIA’s Policy Council, as of February 2018, 39 of the 89 federally-licensed producers (LPs) of cannabis in Canada were publicly traded, raising a total of $1.2 billion CAD in January 2018 alone. On June 20th, it was announced that Tilray would be joining Cronos Group as the second Canadian LP listed on the U.S.-based NASDAQ; behemoth Canopy Growth is listed on the NYSE.
In late 2017, Canopy announced the sale of nearly 10 percent of its stock to U.S.-based alcohol giant Constellation Brands (known for Corona and SVEDKA vodka) for a cool $191 million dollars. Now that cannabis is legal in Canada, there are certain to be even bigger deals fastly approaching that U.S. operators are missing out on.
Impressive Advancements are Being Made – Just Not in America
The United States is also being left behind in terms of research and development and intellectual property within the cannabis space. In countries such as Israel, where the federal government appropriates money to researching marijuana, rapid advancements are being made that could be groundbreaking – and have global effects. In 2017, there were more than 110 clinical trials involving cannabis in Israel – far more than any other developed nation. It was also recently revealed that China now holds around half of the IP related to hemp in the world. This puts Americans at a disadvantage as the rest of the world competes to create innovative and life-altering cannabis medicines and technology.
“R&D requires access to capital and federal and academic support,” explains Frank Lane, President of Cannabis Financial Network. “These remain elusive in the U.S. because cannabis remains federally illegal. The U.S. is slowly allowing more University backed cannabis research but at a much slower pace then Israel, Canada and have allowed research on a federal level for years. The U.S. will be playing catch up as medical cannabis continue to be adopted globally.
Exports Expected to Rule Canadian Market
While legal domestic sales won’t begin for several months, some Canadian LPs have already been exporting cannabis products to several countries that have approved the plant for medical purposes. It was announced last October that Cronos Group had reached a deal to put their products in over 12,000 pharmacies across Germany, where the government is choosing to use their own socialised healthcare systems to handle the distribution of cannabis product to patients. Obtaining these lucrative government contracts means big money for exporters, and unfortunately for entrepreneurs from the U.S. looking to cash in may be too late by the time legalization occurs.
“Many European and Latin American countries are approving cannabis for medical use,” Lane adds. “These are billion dollar markets that countries like Canada and Uruguay are seizing because they have federally legalized cannabis and become adept at developing pharmaceutical grade products.”
U.S. Canna-Businesses Must Double Down on Reform Efforts
Until the federal government ceases to consider cannabis a Schedule I narcotic, American businesses will continue to lag behind and miss out on multi-billion dollar opportunities. Therefore, it is more important than ever that the industry continue to communicate with policymakers in order to create impactful change – before it’s too late. Attending events such as the NCIA Quarterly Cannabis Caucus series is a perfect way to engage with local politicians and fellow entrepreneurs while also staying up to date on the latest legalization developments.
By Morgan Fox, NCIA’s Director of Media Relations
On June 19, Canada