Tag Archives: ballot initiative

Rule or Law? The Difference Matters For Your Marijuana Business

By Daniel Shortt on October 28, 2015 Posted in Legal Issues, States

This is for federal bills, but it nicely illustrates how complicated the process can be.

Laws are different than rules and understanding the difference between the two can be important to your marijuana business’s bottom-line. I will use Washington State as the example.

In Washington, laws are generally enacted through initiative or through the legislative process. Initiatives allow voters to pass laws directly by popular vote. Washington legalized recreational marijuana by popular vote — Initiative 502 in 2012. The legislative process requires a bill pass through both Washington’s Senate and House of Representatives and then garner the Governor’s signature before becoming law. Recently, SB 5052 and HB 2136 were passed through the legislative process and established new Washington State laws regarding medical cannabis.

As is the case with other states with “robust regulation,” Washington cannabis businesses are also subject to rules created by state agencies without the political protections provided by initiatives and the legislative process. State agencies, like the Washington State Liquor and Cannabis Board (LCB), are government entities given the power to regulate and govern a specific area or industry. These agencies are typically run by unelected officials. Agencies arguably create more efficient government because they a focus on one discreet area or industry, with expertise not usually available to legislatures and lawmakers.

A rule is an agency order, directive, or regulation that applies to the public generally. Rules are similar to laws because those who violate them may be subject to penalties and sanctions. Rules can and do change constantly, whereas laws tend to remain more static. The LCB’s rule-making process may begin with an individual’s petition to the LCB, but often the agency itself initiates the process against a cannabis business if it sees a need to do so.

To enact a rule, the LCB must publish notice of the rule-making in the Washington State Register. The LCB then holds a public hearing at which citizens are given an opportunity to comment on the proposed rule. Citizens can also submit written comments to the LCB about the proposed rule. The LCB must consider the public comments and then issue an order of adoption, which explains the new rule and the basis for its adoption.  Agencies can also institute emergency rules, which are not subject to the above requirements and become effective immediately. These emergency rules only last for up to 120 days and they must be in response to some immediate issue or danger. The Washington Department of Health recently issued emergency rules for medical marijuana, for instance.

Despite similarities to laws, LCB rules are not subject to the same type of political recourse as laws. This is significant because LCB regulations have huge impacts on the cannabis marketplace. For example, in Initiative 502, voters enacted residency requirements that restrict issuance of cannabis licenses only to those who can demonstrate having spent a certain amount of time in the state (see here and here). The Initiative never mentions “True Party of Interest.” In its rule making though, the LCB created the term, True Party of Interest, and defined it, and now applies the residency requirements to any party deemed to be a True Party of Interest. The definition for a “True Party of Interest” includes all investors and the spouses of any shareholders or principal. Though never contemplated by the voters, the “True Party of Interest” rule significantly restricts the marijuana marketplace by making it difficult for out-of-state investors to put their funds into Washington State cannabis businesses. Moreover, Washington voters who disagree with the “True Party of Interest” rule have little recourse beyond lobbying to get this rule changed.

One of the best ways for citizens to get involved with LCB rule making is to comment during the agency’s rule-making process. Currently the LCB and the Washington State Department of Health are holding hearings regarding medical marijuana regulations. If you care about the future of the marijuana industry in Washington State you should make your voice heard at one or more of these hearings.

CONTINUE READING…

Marijuana for Millionaires

—By Kevin Drum

| Sun Nov. 1, 2015 2:31 PM EST

41128_424755311230_2510995_nYesterday a friend emailed to ask if I had any thoughts about Ohio’s Issue 3, which would fully legalize marijuana cultivation and sale in the state. Ohio? I barely pay attention to California, let alone Ohio.

But Issue 3 turns out to be surprisingly fascinating—or venal and repellent, depending on your tolerance for sleaze. Apparently one of the authors of the initiative came across a Rand report on marijuana written by a bevy of drug-policy worthies, and it offered up a dozen possible options for legalization. One of them is called "structured oligopoly":

It is natural to ask whether there is some way to get for-profit businesses to behave in the public interest. The answer is “Perhaps.”

….States might prefer instead to offer only a limited number of licenses, creating artificial scarcity that makes the licenses valuable—valuable enough that firms will have a strong incentive to cooperate with regulators rather than risk revocation….Limiting the number of licensees also makes monitoring their behavior easier. A rogue company could more easily break the rules if it were one of 1,000 licensees than if it were one of just ten.

….So a structured-oligopoly strategy might involve licensing a limited number of firms, monitoring them closely, and not being shy about rescinding a firm’s license if it behaves in ways contrary to the public interest.

This might not be your cup of tea, but let’s stipulate that it has some potential. How would you distribute these licenses? The straightforward approach is to auction them off for set periods. Unfortunately, this has a big drawback: it maximizes the payment for licenses, and thus minimizes the profit of the oligopolists. This is obviously vexing.

So how about this instead? Pick out ten rich friends. Each is required to put up $2 million to help pass a ballot initiative. In return, you promise to write the names of the investors directly into the initiative, giving them a perpetual and exclusive right to grow marijuana in the state of Ohio.1 In addition, you write a special, unalterable flat tax rate into the law, as well as a minuscule annual licensing fee. Now that’s an oligopoly you can believe in! Keith Humphreys, who brought this to my attention, has a few comments:

It has taken the alcohol industry decades of lobbying to roll back many of the restrictive, public health-oriented regulations established after the end of Prohibition. Booze industry executives must look with envy upon the emerging marijuana industry, which can use the ballot initiative process to achieve complete regulatory capture from day one.

….No one should be surprised that in a country with an entrepreneurial culture, a commitment to free markets, and a political system highly attuned to corporate donations, legalized marijuana would develop a significant corporate presence. Indeed, many drug policy analysts, including me, expected this to happen eventually. But the rate at which the change is happening is truly startling, and will become even more so if the Ohio initiative passes.

If the marijuana industry ends up being a clone of the tobacco industry, will legalization supporters experience buyers’ remorse? It depends who you ask.

Well, you could ask me. I don’t care what they’re legalizing. This stinks. It’s crony capitalism without even a veneer of decency, and if it applied to anything else nobody would have the gall to ever let it see the light of day. If this is the price of pot legalization, count me out.

1Technically, no names are actually in the initiative. Instead, it limits marijuana cultivation to ten specific parcels of land that are owned by the ten investors. Also, individuals are allowed to cultivate small amounts for their own recreational use if they get a licence.

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San Francisco Supervisors, Oaksterdam official speak

By: Bay City News | 04/03/12 4:55 PM

An enthusiastic crowd of more than 200 medical marijuana patients and supporters rallied at San Francisco City Hall on Tuesday to hear six city supervisors and an Oaksterdam University official decry a recent federal crackdown on cannabis dispensaries.

The midday protest was planned five weeks ago, according to Americans for Safe Access Executive Director Steph Sherer, but coincidentally came the day after Monday’s federal searches of Oaksterdam University, a cannabis industry trade school in Oakland.

Oaksterdam Executive Chancellor Dale Jones, speaking from the steps of City Hall, evoked both the raids and the unrelated mass shooting that also occurred in Oakland on Monday and resulted in the deaths of seven people at Oikos University.

“Two universities were struck yesterday,” said Jones, who said police resources should be used to prevent violence and not to stop patients from obtaining medical marijuana.

“Why are law enforcement officers guarding a plant that hasn’t killed a person in human history?” she asked.

Jones told the crowd, “This raid was meant to demoralize us, but it did not cripple us, it merely galvanized us.”

Federal agents searched Oaksterdam’s headquarters and four other Oakland sites associated with Oaksterdam President Richard Lee on Monday. The school teaches courses on marijuana horticulture and dispensary management.

Joshua Eaton, a spokesman for U.S. Attorney Melinda Haag, said he could not comment on possible next steps in the investigation or on when the search warrants used in the raids will be unsealed.

Tuesday’s San Francisco rally was aimed at protesting a crackdown on medical marijuana dispensaries announced in October by the four regional U.S. attorneys in California, including Haag, who is the chief federal prosecutor for Northern California.

The prosecutors said they planned to target large-scale commercial enterprises that operate under the guise of providing medical marijuana. Haag said her office would begin by concentrating on dispensaries near schools and parks.

California’s Compassionate Use Act, approved by state voters in 1996, allows seriously ill patients to use marijuana with a doctor’s permission, but federal laws criminalizing the drug make no exception for state medical marijuana laws.

Eaton said Haag had no comment onTuesday’s protest.

Six supervisors — a majority of the 11-member Board of Supervisors — told the crowd they opposed the crackdown, as audience members cheered and waved signs saying “Cannabis is medicine, let states regulate.”

They were Board President David Chiu and Supervisors John Avalos, David Campos, Jane Kim, Christina Olague and Scott Wiener.

“What people are asking for is something simple: they need access to their medicine,” Olague said.

“I hope that in a few short years, everyone in the United States will understand what we are fighting for,” Chiu said.

Several other legislators and officials, including San Francisco District Attorney George Gascon, City Attorney Dennis Herrera, state Sen. Mark Leno, D-San Francisco, Marin and Sonoma, and Assemblyman Tom Ammiano, D-San Francisco, did not attend the rally in person, but sent representatives with messages of support.

Charley Pappas, a patient and the former operator of the now-closed Divinity Tree Patients Wellness Cooperative in the city, said, “We’re not a profit-making criminal organization. We are supplying medicine for those who need it.”

The dispensary on Geary Street at the edge of the Tenderloin District, which was near a small public playground, was forced to shut down after Haag’s office threatened Pappas’s landlord with forfeiture of his property.

After the speeches, the crowd marched two blocks to the Federal Building, which houses Haag’s office, and chanted “Shame, shame, shame” and “We’re patients, not criminals” at the building before dispersing.

Action Alert: Legalize Medical Marijuana in Kentucky

 

 

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SENATE BILL 129

The Gatewood Galbraith Memorial Medical Marijuana Act

Legalize Medical Marijuana in Kentucky

· Changes Marijuana from Schedule I to Schedule II

· Allows qualified patients to possess 5 ounces and to grow 5 plants

· Requires State Pharmacy board to set up rules for distribution

· Allows Physicians to prescribe without penalty

 

What to do

1) Find and Email your State Senator at www.lrc.ky.gov

Example: Dear Senator _______, I’m writing you today to ask you to support Senate Bill 129, The Gatewood Galbraith Memorial Medical Marijuana Act. Marijuana is clearly not a dangerous drug and it definitely has Medical value. Kentucky doctors and patients should decide appropriate medical care, not Washington Bureaucrats . Sixteen other states have passed similar legislation and I believe that Kentucky should join those states and protect citizens with illnesses from legal sanctions. Our veterans returning from war especially deserve access to marijuana for the physical and emotional trauma they’ve suffered. It’s the Christian thing to do! Note: Personalize your email and include examples of people who are in need.

2) Follow up with a call to the Legislature Message line @ 1 (800) 372-7181

You can also call your State Senator directly. Their contact Information is available on their webpage on the lrc website. You can use the above example, but be sure to personalize your call and include examples of people you know who have a medical need. Ask them to co-sponsor the legislation.

3) Repeat the above two steps with your State Representative

You have both a State Senator and a State Representative. This is a Senate bill. Ask your representative to write and sponsor a companion bill for the House of Representatives.

4) Make an appointment to meet them in Frankfort to discuss the bill

They are your voice in government. They can’t refuse to meet with you. If you have the courage to speak to them in person, be sure to dress and conduct yourself professionally. You will probably only get 15 minutes with them, so be prepared and bring this flyer or some other document that supports your position. You will enjoy the trip to Frankfort, it’s a beautiful place.

5) Copy this Flyer and share/post it everywhere!!!

Send a quick email to [email protected] so that I can get information to you rapidly. We will have to act quickly when the bill goes before committee. Please let me know your story and if you wish to testify before the committee (anyone can). It’s your government!!!

LINKS:

SB129 Ky Legislature

The Gatewood Galbraith Medical Marijuana Act of 2012

Kentucky Medical Marijuana/Cannabis Act

The White House – Resources