By: Nabil Rodriguez*, J.D. & Rachel K. Gillette, Esq.
Today on 4/20, we understand (and fully support!) the desire to sit back and celebrate. Cannabis legalization has come a long way. Closet stoners have evolved into budding entrepreneurs, and the industry continues to grow almost as fast as the plants upon which it was built. As we celebrate the accomplishments and progression of this booming industry, it’s important to reflect on the uphill battle that cannabis legalization has faced and take note of the challenging climb still ahead.
In 1970, the Controlled Substances Act banned all forms of cannabis. Most recently, the 2018 Farm Bill legalized a species of cannabis (hemp) at the federal level. Today, we have 10 states and the District of Columbia that allow for adult use cannabis. 33 states, the District of Columbia and the U.S. territories of Guam and Puerto Rico have legalized cannabis for medical use. Although we take the day to celebrate how far we have come, there is still a long way to go before we tap the full potential of this industry.
Most importantly for marijuana, federal legalization remains an inverted rock face that the industry has tirelessly been trying to conquer.
In the meantime, we can at least get closer to the end goal by passing the SAFE Banking Act (H.R. 1595) which would expand financial bank services to legitimate cannabis businesses. This bill would provide cannabis businesses a much needed safety net by allowing them options other than operating as mainly cash-businesses. In the same regard, we must continue the fight against I.R.C. §280E so that legitimate state businesses have fair taxation.
At the state level, we need to come together and – unlike the varying “universal symbols” used to label cannabis – become truly universal. For example, Colorado needs to pass its legislation to allow normal investment and capitalization via publicly traded companies and work towards fair and reasonable regulations rather than holding onto regulations that were drafted around the fear of something new.
For hemp, although the 2018 Farm Bill was a great first stepping stone, we need the FDA to create concreate regulatory pathways for CBD in food and dietary supplements. We need the USDA to draft regulatory guidance to govern the production of hemp so that state programs can be approved. We need to find new and creative ways to engage law enforcement and educate them on the differences between hemp and marijuana including clear guidance on how to verify and protect hemp and hemp-derivative products through the channels of interstate commerce.
Here at Greenspoon Marder, we will be relentless in our mission help safely advance the industry. Happy 4/20 from the GM family!