STATE CANNABIS LAWS: A PROGRESS REPORT SUCCESSES, CHALLENGES, AND THE NEED FOR CONGRESSIONAL ACTION INDUS ABIS TR N Y N AS A S C O L C A I N A T O I I O T N A N THECANNABISINDUSTRY.ORG T h g e r C .o an try nabisIndus TABLE OF CONTENTS Executive Summary ...................................................................................................................... 3 Economic Benefit - Jobs and Tax Revenue ..............................................................................7 Access to Banking Services .......................................................................................................10 Fairness in Taxation ....................................................................................................................12 Impact on Crime ..........................................................................................................................14 Reduction in Arrests but Disparities Remain ..........................................................................15 Reducing Access to Minors .......................................................................................................16 Cannabis as Part of a Comprehensive Response to the Opioid Crisis .............................19 Highway Safety ...........................................................................................................................22 Public Opinion .............................................................................................................................24 Recommendations ......................................................................................................................28 ORIGINALLY PREPARED FOR The National Cannabis Industry Association by Michael Liszewski of the Enact Group and Tom Angell, May 2018. Updated by NCIA in May 2019. 2 National Cannabis Industry Association | TheCannabisIndustry.org | 128 C ST. NW, Washington, D.C. 20001 | (888) 683-5650 State Cannabis Progress Report EXECUTIVE SUMMARY About the National Cannabis Industry Association Representing nearly 2,000 member-businesses It has been more than two decades since California across almost every state in the U.S., the National voters adopted the first modern state medical Cannabis Industry Association (NCIA) is the cannabis program with the passage of Proposition largest trade association for the nation’s rapidly- 215 in 1996. Since that time, 33 states, the District of growing state-legal cannabis sector. NCIA was Columbia, and several U.S. territories have adopted founded in 2010 to promote the growth of a comprehensive medical cannabis programs, responsible and legitimate cannabis industry and enabling millions of patients to obtain relief from work for a favorable social, economic, and legal a variety of conditions and improve their quality of environment for marijuana businesses in the life. In states with legal access to cannabis, many United States. patients are successfully using it as an alternative to dangerous opioid pain medications. An additional NCIA publicly advocates for the unique needs 14 states have passed more limited laws that of the emerging cannabis industry and defends allow for the possession and use of high-CBD against threats to the state-regulated medical and (cannabidiol), low-THC extracts, leaving just three adult-use cannabis markets. As the nation’s most states without a medical cannabis law. established and broadly representative industry- led organization engaging in legislative and In 2012, voters in Colorado and Washington State policy efforts to expand and further legitimize the approved ballot measures to legalize marijuana state-legal cannabis market in the United States, possession and use for adults 21 and older and NCIA works extensively at the federal level to to tax and regulate licensed businesses to grow, create policies that allow individuals, businesses, process, and sell cannabis in retail stores. While and states to fully realize the economic and many policymakers and observers were skeptical societal benefits of legalized cannabis in a of these initial adult-use tax and regulate responsible way. programs, time has demonstrated that they are sound policies delivering substantial benefits to the residents of their states, while fears that the About this report sky would fall have never materialized. The United States is currently experiencing a On the heels of the first legal adult-use retail political, social, and economic evolution in how sales of marijuana in 2014, voters in Alaska, it treats cannabis. State-legal cannabis markets Oregon, and the District of Columbia approved are no longer in their infancy and are proving to legalization measures, followed by California, be a significant source of jobs, tax revenue, and Maine, Massachusetts, and Nevada in 2016, economic stimulation in states that were early and then Michigan in 2018. Juxtaposed against to embrace its potential. State regulations and these landmark victories, the appointment of licensing programs are also proving to be more Jeff Sessions as U.S. Attorney General created effective at keeping cannabis out of the hands significant concern in the cannabis industry as of minors than the illegal actors who inevitably well as among the administrators of the state serve cannabis consumers in states still operating and local government programs now dependant under prohibition policies. 3 upon marijuana tax revenues. But in the wake supporting legalization, Barr reiterated that he of Attorney General Sessions’ January 2018 would not direct the Department of Justice to rescission of the August 2013 Department target businesses that are in compliance with of Justice guidance memorandum generally state law, and urged Congress to address the deprioritizing conduct compliant with state disparity between state and federal marijuana marijuana laws (known as the “Cole memo”), laws.2 lawmakers across the country only grew more determined to work towards sensible marijuana Why is marijuana legalization policies. and regulation important? The legalization and regulation of commercial “In 2016, President Trump said production and sales of cannabis for adults has marijuana legalization should be brought significant economic benefit to the states left up to the states and I agree.” that have adopted these types of laws. For example, the cannabis industry has been able to provide —Senator Cory Gardner (R-CO)1 a substantial source of revenue for states that implemented tax and regulate programs. Shortly after the Cole memo rescission, Vermont States that have enacted adult-use and medical approved legislation allowing adults 21 years of cannabis laws have also experienced positive age and older to cultivate, possess, and consume societal impacts. As the opioid overdose crisis cannabis. Meanwhile, several new prominent has grown in several areas of the country, states members of Congress from both sides of the where patients have access to medical cannabis aisle spoke out against the notion that the federal have experienced an average reduction of 24.8% government should undermine or interfere with in fatal opioid overdoses.3 the implementation of state marijuana programs. This has happened When Republican and Democratic leaders begin while teen use has generally decreased or to agree on policy, legislative change becomes a held steady in the wake of the legalization and real possibility. This is the new political reality for regulation of adult-use cannabis. Fears that cannabis in 2019. highways would become plagued with increased fatalities caused by marijuana-impaired drivers have not materialized, with several states When Jeff Sessions resigned in November 2018, many advocates were left wondering how the actually experiencing decreases following the next attorney general would treat the cannabis adoption of legal adult-use cannabis programs. In issue, particularly whether that person would addition, crime has generally decreased following order federal prosecutors to crack down on legalization, as arrests have dropped and retail state-legal businesses. During the confirmation marijuana stores have been shown to create a process, however, nominee - and now Attorney small but measurable dampening impact on local General - William Barr said that he would not crime. And of course law enforcement is now interfere with the expectations that had been free to use their limited resources to investigate established during the Cole years. Despite not serious crimes. 1 “Gardner Statement on DOJ Marijuana Legalization Enforcement.” Office of Senator Cory Gardner, Jan. 4, 2018, https://www.gardner.senate.gov/newsroom/press-releases/gard- ner-statement-on-doj-marijuana-legalization-enforcement. 2 Jaeger, Kyle, “U.S. Attorney General Says He Prefers Marijuana Reform Bill To Current Federal Law,” https://www.marijuanamoment.net/u-s-attorney-general-says-he-prefers-mari- juana-reform-bill-to-current-federal-law/, Marijuana Moment, April 10, 2019. 3 Bachhuber, Marcus A., et al. “Medical Cannabis Laws and Opioid Analgesic Overdose Mortality in the United States, 1999-2010.” JAMA Internal Medicine, vol. 174, no. 10, 1 Aug. 2014, p. 1668., doi:10.1001/jamainternmed.2014.4005. 4 National Cannabis Industry Association | TheCannabisIndustry.org | 128 C ST. NW, Washington, D.C. 20001 | (888) 683-5650 State Cannabis Progress Report Table 1: Economic Benefit for States with Marijuana Taxation and Regulation STATE CANNABIS TAXATION SUMMARY TOTAL TAX COLLECTIONS (2018) $50 per ounce excise tax on bud and flower