A bipartisan group of congressmen from both sides of the Hill have introduced legislation that may have the best chance to end the federal prohibition of marijuana. Led by Republic Senator Cory Gardner, Democratic Senator Elizabeth Warren (9 co-sponsors, none from Michigan) and companion house legislation from Democratic Representative Dana Rohrbacher (21 co-sponsors including Justin Amash from Michigan), the very anticipated STATES Act (S 3032) is that the marijuana industry has been waiting for. If passed the Control Substances Act would no longer apply to any person acting in compliance with state law related to the manufacture, production, possession, distribution, and delivery of marijuana. It also amends the definition of marijuana to exclude industrial hemp. This could be the most significant piece of legislation in the history of federal cannabis policy reform.
Ironically, it started when U.S. Attorney Jefferson Sessions rescinded the Cole Memorandum in January 2018 which removed a DOJ policy protecting those who were in the business of marijuana who were strictly compliant with state law. Sessions did this without consulting anyone in Congress which led to a significant backlash. One of the most outspoken members of Congress was Sen. Cory Gardner, the Republican Senator from Colorado. Senator Gardner saw the move as an attack on the industry in his home state which made recreational marijuana legal in 2014. In response, Gardner began to block all DOJ nominations on positions like U.S. District Attorneys and U.S. Marshals. Sessions began to complain that critical posts were going unfilled. The move becomes a problem so President Trump had to step in.
On April 13, 2018, after a lengthy phone call with Sen. Gardner, President Trump promised to provide support to congressional efforts to protect states that have legalized marijuana defusing the month’s-long standoff regarding the DOJ nominations. Trump was being consistent with a campaign promise and belief that marijuana legalization was a states rights issue.
What does a “state’s rights” issue mean?
The Tenth Amendment of the Constitution expresses the principles of federalism and states rights. Specifically, it states that the federal government possesses only those powers delegated to it by the United States Constitution and all remaining powers are reserved to the states. In short, where Congress has the authority to prohibit certain acts like possess marijuana, it lacks the power to compel the states to prohibit those same acts. This is a well-established rule of law which has been upheld by our Michigan Supreme Court in Ter Beek v. Wyoming. Further, courts have found that when both Federal law and state law are not in direct contradiction and the purpose and objectives of both can be fulfilled, the states right to enact the legislation is preserved.
This is how: the main objective of the federal Controlled Substances Act was to combat drug abuse and control the legitimate and illegitimate trafficking of controlled substances. Congress created a closed regulatory system making it unlawful to deal with a controlled substance except in a manner authorized by the CSA then classified marijuana as a schedule one controlled substance designating it as contraband for any purpose and indicating it has no acceptable medical use. Michigan did the same. But enacting the Michigan Medical Marijuana Act (MMMA) the People of the State of Michigan choose to part ways with the CSA only regarding the scope of acceptable medical uses of marijuana allowing a limited class of individuals, patients, to engage in its use. The MMMA is a criminal defensive statute providing limited immunity which does not frustrate the operation or purpose of the CSA. Put another way, the MMMA does not seek to alter or contradict the CSA’s federal criminalization of marijuana. Similarly, marijuana is still illegal in Michigan, the MMMA simply provides a limited exception and immunity under specific circumstances. Now a strong, bipartisan, bicameral federal bill supporting a state’s right to legalize marijuana is finally here.
What does the bill say?
The proposed legislation states that the Controlled Substances Act does not apply to any person acting in compliance with state law relating to the manufacture, production, possession, distribution or delivery of marijuana. The same protections are provided for a Federally recognized Indian tribe. The bill removes industrial hemp from the definition of marijuana. In an effort to change the Tax Code, the bill proclaims that conduct in compliance with the Act shall not constitute trafficking of a controlled substance which will allow the normal deduction of business expenses contrary to Section 280E of the tax code. It also specifies that the conduct allowed under the act shall not constitute a basis for civil asset forfeiture. Lastly, in an effort to reform federal banking for cannabis, proceeds from any monetary transaction in compliance with the Act shall not be deemed to be the proceeds of an unlawful transaction under the federal money laundering statutes.
What is next for the bill and What is the likelihood that it will get out of committee?
Because the bill allows the states to decide, instead of federally legalizing or de-scheduling marijuana Republican congressmen are more likely to support it as they do with other similar legislation.
The Senate bill has been referred to the Senate Judiciary Committee which includes many Democratic Senators who champion marijuana issues like Cory Booker from New Jersey. But there are 11 Republican members and Chaired by Republican Senator Chuck Grassley of Iowa.
Sen Chuck Grassley is a federalist. In September of 2013, he wrote the Preface to a white paper regarding the importance of eliminating federal interference with state decisions on academic standards in strong support of the 10th Amendment. He stated, “The system of federalism outlined in the U.S. Constitution is not a technicality nor was it an accident. It was designed to make the government accountable by the people by placing power locally.” In 2013 Grassley also co-sponsored the “Restoring the 10th Amendment Act” which enabled states to dispute federal regulations and executive orders. (Although this bill never made it out of the judiciary committee).
The most senior Republican member, and former Chair, Orrin Hatch from Utah has also supported several states rights issues. in 2013 he campaigned for an initiative for Utah to assert its states rights in the ownership, control, and regulation of federal land to the state.
If these Republican senators can find their way to support The STATES Act, it will go a long way with the remainder of the conservative portion of the committee. A hearing is necessary for the committee to send it to the full house for debate and vote.
If passed, what does it mean for the industry?
If signed into law, it would be the most important federal policy change in the history of cannabis policy. It would solve the federal banking, income tax, asset forfeiture, and criminal prosecutions for legitimate businesses. It would provide a significant economic boost to the industry and allow it to grow into maturity and mainstream acceptance just like alcohol.
What can we do to help?
We need to get our Michigan Congressional Delegation to support and co-sponsor this legislation. I personally attended a meeting with Debbie Dingall in her D.C. congressional office earlier this year regarding cannabis policy and she was in support, especially with medical marijuana. Communicate with your congressional representatives and demand that they support this, and similar legislation because that is what their constituents want and that is what the State of Michigan and the industry as a whole needs.