Today is the holy cultural holiday for the cannabis industry, 4/20. Of all 4/20 in the past, this applies a little differently (although 2015 was also a good year). We have seen so many policy changes in support for cannabis over the past year, including legalization from state to state. We also saw some fun, holiday-specific events – Colorado has a great auction of 4/20 festive license plates, and Adidas has a 4/20 draw to buy Towelie Superstars (yes, I signed up for that draw). ).
While you probably won’t be able to gather en masse to celebrate cannabis this year, here’s a list of the unique highlights to make thankful for that socially aloof 4/20:
Democratically controlled Congress and the White House
If you haven’t lived under a rock, you know the Dems are now in control of Congress and the White House, which means cannabis should finally get a fair shock on legalization (at least according to Senate majority leader Chuck Schumer ). While President Biden never endorsed legalization, he seems to be doing fine with medical cannabis now, and Democrats also seem pretty optimistic about getting some sort of cannabis legalization through Congress before mid-2022.
The MORE law
The Marijuana Opportunity, Reinvestment and Expungement Act (the “MORE Act”) is a historic law that could actually lead the political battle to get it through Congress. It happened the house last year but was shut down by the Republican-controlled Senate as we predicted.
Among other things, the 2019-2020 version of the MORE Act:
- completely removes cannabis from federal controlled substances law and decriminalizes / decrypts it altogether
- remove criminal penalties for everyone in the commercial chain of production, distribution and sales (which would also mean that the bank access problems and draconian effects of IRC 280E would be over);
- deletes cannabis criminal records from May 1, 1971; and
- Introduces a federal tax on cannabis products made in the United States or imported into the United States. . . this corresponds to 5 percent of the price for which it was sold. “
While the MORE Act 2019-2020 enables the Feds to participate in setting rules for a federal legal framework, states would still have control over licensing, oversight and enforcement within their borders (much like alcohol).
Just last month, Chairman of the House Judiciary Committee Chairman Jerrold Nadler confirmed that he will reintroduce the MORE law. If the Dems are really serious about legalization, the 2021 version of the MORE Act will be much more detailed and likely even include some significant changes to ensure that a comprehensive federal framework is in place (and you can bet certain private stakeholders will themselves advocate this legislation everywhere.
The SAFE Banking Act
Access to financial institutions for cannabis companies was mediocre as per the 2014 FinCEN guidelines. These guidelines do not change or improve anything in federal bank laws that otherwise prevent financial institutions from accepting cannabis dollars based on the Bank Secrecy Act and federal anti-money laundering laws.
As a result, the cannabis industry has been calling for federal reform for years, campaigning to ensure that cannabis companies can only deposit their money with banks and credit unions. Many legal experts and policy analysts now believe that before we see any version of the MORE Act take full flight, we will see small technical federal corrections to bring about the end of the federal cannabis ban and the Secure and Fair Enforcement Banking Act (the “SAFE Banking Act”) is one of these corrections.
In short, the SAFE Banking Act creates a safe haven for banks and credit unions so they cannot be held liable or subject to federal foreclosure for providing financial services to a cannabis company. The house passed the SAFE Banking Act four Time now with the fourth approval vote, which takes place yesterday. The hope is that now that Congress and the executive are controlled by the Democrats, the SAFE Banking Act will easily (and quickly) become law (at the same time, there could be various strategic reasons for just adopting parts of the SAFE Banking Act and them in a wider legalization measure).
Attorney General Merrick Garland (sorta)
Under former President Donald Trump, we saw two lousy picks from the Attorney General. The first was infamous cannabis hater Jeff Sessions, who eventually withdrew all Justice Department guidelines on state enforcement of cannabis and left the DOJ with a single cannabis enforcement memo that exposed only federal controlled substances law. The second, Bill Barr, wasn’t so bad that it basically shifted to the 2013 Cole Memo regarding federal enforcement in states with legal cannabis.
Under President Biden, Merrick Garland is the US Attorney General. Without a doubt, Garland is not a session and it sounds like he’s more like Barr where he won’t be introducing a Cole Memo 2.0, but he also won’t be wasting federal enforcement resources on state-legal cannabis.
Legislative support for the legalization of cannabis nationwide
A great wave of change is with more and more states legalizing cannabis through legislative action rather than waiting at the ballot box for people’s initiatives. Earlier this year, New York, Virginia, and New Mexico legalized cannabis through their legislation (if you’re interested in New York, be sure to check out our May 4 webinar, “Introducing the Marijuana Regulation and Taxation Act”). Believe it or not, by April 20th there are only 3 states that don’t have a legal form of cannabis (and these are the ones you would expect – Idaho, Nebraska, and Kansas).
Happy April 20th!