On Thursday, Attorney General Eric Holder announced his intent to craft regulations that would allow banking services for legitimate marijuana businesses throughout the country. Banks and credit card companies have been wary of working with marijuana businesses for fear of federal prosecution and loss of licensing, causing serious issues with public safety and hampering the growth of the industry. Advocates are hopeful that this statement directly from Holder, proposing regulations instead of guidance memos, signals a growing tolerance of marijuana policy reform among the states.
On November 5, Colorado passed Prop AA, a measure that outlines the specific taxes to be imposed on the sale of recreational marijuana. The measure works in conjunction with Amendment 64, the ballot measure passed last year that taxes and regulates marijuana for adult use. Prop AA is an important step to establish taxes to fund the regulation of the marijuana industry. Although Colorado has ended their prohibition of marijuana, it is still illegal under federal law. The DOJ announced in July that it will not interfere in Colorado’s implementation of a regulated marijuana industry, but only if it adheres to the regulations set out in Amendment 64 with a fully-funded regulatory body, among other criteria.
In order to pay for regulation and oversight, Prop AA establishes a 15% excise tax imposed on the sale of marijuana from a cultivation facility and a 10% sales tax imposed when a consumer purchases marijuana from a retail store. This tax revenue will allow the state to monitor marijuana sales and implement the regulations set out in Amendment 64. The revenue will also go toward the Building Excellent Schools Today program, which will improve infrastructure, technology, and construction of new facilities for Colorado Public Schools.
In August, Attorney General Eric Holder announced that the DOJ would avoid prosecuting low-level, non-violent drug offenders with harsh charges that carry mandatory minimums.
Today, a vicious cycle of poverty, criminality, and incarceration traps too many Americans and weakens too many communities. However, many aspects of our criminal justice system may actually exacerbate this problem, rather than alleviate it.
Now, the DOJ has taken another stepand announced that the new policy will also apply to persons who have been charged but not yet tried and persons who have been tried but not yet sentenced. The attorney general instructed his prosecutors to re-file charges in these cases so that low-level offenders will not be subjected to disproportionate sentences.
I am pleased to announce today that the department has issued new guidance to apply our updated charging policy not only to new matters, but also to pending cases where the defendant was charged before the policy was issued but is still awaiting adjudication of guilt.
This announcement comes in the wake of a statement by the DOJ last month that the federal government would allow states to continue with their plans to regulate and tax marijuana without interruption, so long as they meet certain criteria.
On Tuesday, MPP director of federal policy Dan Riffle spoke with Fox Business Network about the Department of Justice announcement last week that the federal government will not interfere with the implementation of legal marijuana businesses in Colorado and Washington.
Last week, the Department of Justice announced that it would not prioritize marijuana enforcement against businesses that were following state law and adhering to a set of criteria established by Deputy Attorney General James Cole. Given the administration’s history with marijuana policy, there is a lot of speculation about what this memo will mean for the future of reform efforts and the legal marijuana industries in Colorado and Washington, as well as the 20 states and the District of Columbia that allow marijuana for medical purposes.
Here is an excerpt from an in-depth analysis by MPP’s executive director Rob Kampia in the Los Angeles Times:
The Cole memo was the equivalent of no policy at all, since the federal government goes after very few individual marijuana users. In 2012, it sentenced only 83 marijuana-possession offenders to probation or prison, according to the U.S. Sentencing Commission. Meanwhile, the DEA raided more medical marijuana providers during Obama’s first term in office than it did during the eight years under President George W. Bush.
So what can we learn from the Obama administration’s words and actions?
The key lesson is to write state-level marijuana laws correctly. There have been hundreds of outrageous DEA raids on medical marijuana clinics in California, Montana and Washington state, but these three states’ laws don’t explicitly authorize the clinics in the first place. (These states simply authorize patients and caregivers to grow their own.)
In contrast, there have been zero DEA raids on clinics in Arizona, Colorado, Maine, New Jersey, New Mexico, Rhode Island and Vermont. In these states, plus the District of Columbia, there has been a clear licensing process for medical marijuana businesses.