The STATES Act and What it Could Mean for Cannabis Businesses

By Tucker Arensberg, P.C.

DISTRICT OF COLUMBIA: Senators Elizabeth Warren and Cory Gardner introduced the “Strengthening the Tenth Amendment Through Entrusting States Act” (“STATES”) Act – on June 7, 2018.  A companion bill was introduced by Representatives Earl Blumenauer and David Joyce in the House of Representatives.

The STATES Act seeks to amend the Controlled Substances Act (“CSA”), an effort to put the control of legal state marijuana programs in the hands of the states.  The proposed amendments to the CSA provide that as long as a person/persons is/are acting in compliance with their State or tribal laws relating to the manufacture, production, possession, distribution, dispensation, administration or delivery of marijuana, the provisions of the CSA will not be applicable to them.

Perhaps most importantly for cannabis business owners, the STATES Act provides that transactions that are compliant with state and tribal law are not to be considered trafficking and are not to be considered proceeds of an unlawful transaction.  This provision seeks to alleviate the financial issues on cannabis business caused by the federal prohibitions in place.

Limitations imposed by the STATES Act include a prohibition on the distribution of recreational marijuana to anyone under age 21, unless for medical purposes, as well as a ban on the distribution of marijuana at transportation safety facilities (rest areas/truck stops).  Prohibitions of the CSA, including the prohibition of endangering a life while manufacturing marijuana and the prohibition of employing a person under the age of 18 in drug operations would continue to remain in place.

President Trump has made statements suggesting that he would likely support the bill.

The text of the legislation that was introduced in the Senate on June 7, 2018, can be found here:

President Trump Expresses Support For Bipartisan Marijuana Fix

DISTRICT OF COLUMBIA: President Donald Trump on Friday publicly expressed support for bi-partisan legislation that seeks to codify legal protections for state-sanctioned marijuana-related activities.

In response to a question from reporters, the President acknowledgedthat he “probably will end up supporting” The Strengthening the Tenth Amendment Through Entrusting States (STATES) Act of 2018, introduced last week by Senators Elizabeth Warren (D-MA) and Cory Gardner (R-CO). Majority Leader Mitch McConnell has also reportedly promised to permit a vote on the legislation.

URGE YOUR FEDERAL LAWMAKERS TO SUPPORT THE STATES ACT OF 2018

The bill mandates that the federal Controlled Substances Act “shall not apply to any person acting in compliance” the marijuana legalization laws of their state. It also amends federal law to explicitly remove industrial hemp from the definition of marijuana. A bipartisan House companion bill, sponsored by Reps. David Joyce (R-OH) and Earl Blumenauer (D-OR), is also pending in the House of Representatives.

In April, Sen. Gardner acknowledged that he had spoken with the President regarding the intent of his bill and that Trump “assured me that he will support a federalism-based legislative solution to fix this states’ rights issue once and for all.”


For more information, contact Justin Strekal, NORML Political Director, at (202) 483-5500.

Bernie Sanders Files Marijuana Bill In Senate

DISTRICT OF COLUMBIA: Vermont Sen. Bernie Sanders filed a Senate bill Wednesday that would allow states to decide whether to legalize recreational use of marijuana and decriminalize the drug at the federal level. It’s a sign the Democratic presidential candidate is willing to stake out a clear contrast on the issue with front-runner Hillary Clinton.

While some states have legalized pot, it remains illegal on the federal level.

“It’s a state and a federal issue. The federal issue is that we should remove marijuana from the Controlled Substance Act. That’s a federal decision,” Sanders told CNN. “The state decision is that we live in a federal system of government where issues like tobacco and alcohol are significantly regulated by the states. And I think that is a province of the states.”

Top Conservatives Are Totally Confused By Marijuana Politics

MARYLAND: When pressed at an annual conference for conservative activists this week about their stances on marijuana legalization, several members of the Republican Party said that although they personally oppose legalizing the drug, they support states’ rights to do so.

At the Conservative Political Action Conference in National Harbor, Maryland, Fox News’ Sean Hannity asked former Florida Gov. Jeb Bush (R) Friday if Colorado’s legalization of marijuana was a good idea.

“I thought it was a bad idea,” Bush said, “but states ought to have that right to do it. I would have voted ‘no’ if I was in Colorado.”

The Feds, The States And The Controlled Substances Act

COLORADO:   David B. Rivkin and Elizabeth Price Foley have risen to the defense of the attorneys general of Nebraska and Oklahoma, who complain about spillover enforcement costs from Colorado’s law legalizing marijuana and hence are asking the Supreme Court to declare that law unconstitutional.

Along the way they respond to conservative charges of “fair-weather federalism” by pointing to President Obama’s failure to enforce federal drug law in Colorado as the real problem. Yet the gravamen of their legal argument is that, under the Constitution’s Supremacy Clause, federal law trumps conflicting state law, so even when the president won’t enforce that law, states “may not pursue policies that undermine federal law,” as policies in Colorado and three other states allegedly now do.

Do they? How exactly is Colorado undermining federal law? Mr. Rivkin and Ms. Foley cite Colorado’s attorney general as saying that “his state is ‘becoming a major exporter of marijuana.’” He was doubtless speaking loosely there. After all, the state isn’t exporting marijuana. In essence, what the state has done is legalize the sale and use of marijuana—as if it had never made it illegal to begin with. Nothing requires a state to make marijuana illegal. Nor is the state doing anything to prohibit federal enforcement of federal prohibitions. It’s doubtful, therefore, that there is any conflict here for the Supreme Court to notice.

 

Rand Paul Proposes Measure To Shield State Medical Marijuana Laws From Feds

DISTRICT OF COLUMBIA: Sen. Rand Paul (R-Ky.) on Thursday filed an amendment in the Senate that would protect states that implement medical marijuana laws, as well as patients and physicians in those states, from federal prosecution.

Paul’s Amendment 3630, filed Thursday morning to Sen. John Walsh’s (D-Mont.) jobs bill being heard on the Senate floor, allows states to “enact and implement laws that authorize the use, distribution, possession, or cultivation of marijuana for medical use” without fear of federal prosecution. There are 33 states that have enacted laws protecting some form medical marijuana.

The amendment also prohibits prosecution of patients and physicians in those states for violating federal laws against the drug.

“What we’re trying to do is look at the law and allow states that have changed their laws and have allowed medical marijuana to do so, for doctors to be able to prescribe and for people to be able to get those prescriptions without being worried about the federal government coming in and arresting them,” Brian Darling, Paul’s communications director, told The Huffington Post.

White House Says Marijuana Policy Is States’ Rights Issue

DISTRICT OF COLUMBIA: The Obama administration believes marijuana policy is a states’ rights issue, the White House said Monday in opposing Republican-led legislation that would prevent Washington, D.C., from using local funds to decriminalize marijuana possession.

The GOP-sponsored House amendment would prevent D.C. “from using its own local funds to carry out locally-passed marijuana policies, which again undermines the principles of States’ rights and of District home rule,” the White House said in a statement. The White House said the bill “poses legal challenges to the Metropolitan Police Department’s enforcement of all marijuana laws currently in force in the District.”

Del. Eleanor Holmes Norton (D-D.C.) called Rep. Andy Harris (R-Md.) a “tyrant” for meddling in the District’s governing process with the amendment, pointing out that Maryland just voted to decriminalize marijuana possession. The amendment is aimed at blocking a recent D.C. law that lowers the penalty for possessing small amounts of marijuana to a fine.

It’s been less than a year since the Justice Department decided not to sue Washington state and Colorado for legalizing and regulating recreational marijuana. Attorney General Eric Holder told The Huffington Post earlier this year that he was “cautiously optimistic” about legalization in Colorado, which began recreational sales Jan. 1. Washington state sales began this month.

Rand Paul And Cory Booker Team Up To Protect State Medical Marijuana Programs

by Grover Norquist and Ethan Nadelmann

DISTRICT OF COLUMBIA: As soon as next week, the U.S. Senate will have an opportunity to vote on a bipartisan amendment being offered by Senators Rand Paul (R-KY) and Cory Booker (D-NJ that would prohibit the federal government from spending taxpayer money to interfere with state medical marijuana laws. We urge members of both parties – and in particular those who support the 10th Amendment — to take a stand for sensible drug policy and against wasteful government spending. A similar amendment passed the U.S. House a few weeks ago with overwhelming bipartisan support.

Twenty-two states and the District of Columbia have now legalized marijuana for a variety of medicinal purposes – and an additional ten states recently passed laws or have laws before their governors allowing access to CBD oils, a non-psychotropic component of marijuana that has proven uniquely effective in managing the epileptic seizures that afflict children with Dravet’s syndrome. New York may well legalize medical marijuana today.

Lawmakers To Feds: Stop Arresting Medical Marijuana Patients

DISTRICT OF COLUMBIA:  Republican and Democratic lawmakers are calling on the federal government to stop arresting medical marijuana patients in states that have legalized pot for therapeutic purposes.

“Let’s not bust these people who are using medical marijuana for medical purposes in their state,” Rep. Sam Farr (D-Calif.) told reporters on Wednesday at a press conference.

Farr has rallied a small group of eight House Republicans and Democrats who plan to introduce an amendment to the CIS appropriations bill that would prohibit the Justice Department from arresting medical marijuana patients, as long as they are following their states’ rules.

Chuck Schumer: States Should Be Allowed To Legalize Marijuana

NEW YORK:  During a Monday appearance on MSNBC, Sen. Chuck Shumer (D-N.Y.) said states should be allowed to legalize marijuana and act as “laboratories” for drug policy.

Appearing on MSNBC’s “The Daily Rundown,” Schumer was asked by host Chuck Todd what he thinks about New York Gov. Andrew Cuomo’s (D) plan to allow some hospitals to distribute medical marijuana.

“It’s a tough issue. We talk about the comparison to alcohol, and obviously alcohol is legal and I’m hardly a prohibitionist, but it does a lot of damage,” Schumer said. “The view I have, and I’m a little cautious on this, is let’s see how the state experiments work.”

He added that lawmakers should view states like Colorado and Washington, who have legalized recreational pot, as “laboratories” to see if legalization could work on a larger scale.

“I’d be a little cautious here at the federal level, and see the laboratories of the states, see their outcomes before we make a decision,” he said.