Hopeful in Vermont

20150315_CVD_0225

Who needs an election? Local lawmakers could make Vermont the fifth state to legalize adult use cannabis.

By Patrick Wagner

Vermont recently took a significant step toward legalizing cannabis, but the fate of Senate Bill 241 lies in the hands of the House of Representatives.

SB 241 was approved 17-12 by the Vermont Senate in late February. The legislation would establish a licensing and regulatory structure for adult use marijuana sales. If it survives House scrutiny, Governor Peter Shumlin, an outspoken cannabis supporter, is expected to sign it into law.

“With over 80,000 Vermonters admitting to using marijuana on a monthly basis, it could not be more clear that the current system is broken,” Shumlin said in a press release. “I am proud that the Senate took lessons learned from states that have gone before us, asked the right questions, and passed an incredibly thoughtful, common-sense plan that will bring out of the shadows an activity that one in seven Vermonters engage in on a regular basis.”

At this point, advocates say there’s about a 50-50 chance Vermont will become the fifth state in the U.S. to legalize adult use cannabis. It would be the first to do so through the state Legislature, as opposed to a voter initiative.

“The real question is: Can we get this through each of these committees we need to get it through?” said Matt Simon of the Marijuana Policy Project. “If it gets to the floor, I think we’ll have enough votes to pass it. But there are some committees that we don’t have the votes on. We have some convincing yet to do.”

Simon remains cautiously optimistic, but it’s far too soon to celebrate. Several weeks of wall-to-wall testimony and hearings are expected next, and the Senate victory could very well be negated if the House rejects SB 241.

“It’s really been an uphill climb all along,” Simon said. “We were able to get it done on the Senate side, but there’s no real guarantee on the House side.”

Shayne Lynn, director of Champlain Valley Dispensary, praised SB 241 as a moderate way to implement more progressive cannabis laws in Vermont. If it passes, it will create a licensing structure for cultivators and retailers.

The state would allow up to 27 growers and 15 retailers to be licensed in 2017; those numbers could double the following year. Growers would be categorized into four tiers — the smallest being licensed for up to 1,000 square feet, and the largest limited to 10,000 square feet.

Vertical integration would be prohibited for newly licensed, for-profit cannabis businesses. However, existing medical dispensaries would be allowed to continue using a vertically integrated model. Businesses licensed for the recreational market would also be limited to one license, whereas the medical dispensaries are currently allowed multiple licenses.

Vermont’s strict medical marijuana laws that Lynn helped establish would remain intact. Nonprofit dispensaries would continue to operate without the mandatory 25% sales tax for adult use operations.

“This is why I support this,” Lynn said. “It’s moderate and yet we still get what we need in the medical market to succeed.”

Lynn operates two of the four state-licensed dispensaries and was instrumental in the program’s launch three years ago. Even though his operation is tiny compared to businesses in the West, he’s regarded as one of Vermont’s foremost experts in the cannabis industry.

After observing the changes made to medical programs in Washington and Oregon, Lynn said his chief concern with SB 241 is avoiding the boom-and-bust cycles that have plagued western states.

A study published by the RAND Corporation in January 2015 estimated about 80,000 regular cannabis users in Vermont supporting the black market. The estimated annual value of those illicit sales is $175 million.

“It’s awfully difficult to estimate usage in a completely illicit market, and that is obviously where we are in Vermont,” Simon said. “The RAND Corporation’s numbers, which were published about 13 months ago, are still the best estimates that anybody has.”

If RAND’s estimates are accurate, the state of Vermont could collect more than $40 million in annual tax revenue through cannabis sales.

“The question of what to do with those estimates and what kind of policy to make around them is something we really wrestle with,” Simon said. “Nobody will know entirely what this situation is until we regulate this market. That’s what it’ll take to get good data.”

Vermont is just one of several New England states where advocates are looking to repeal prohibition. Voters in Massachusetts are expected to decide on an adult use initiative in the fall, while Rhode Island lawmakers will consider a bill sponsored by a state representative.

Advocates in Maine attempted to send a legalization initiative to voters, but the Secretary of State’s Office invalidated about 17,000 signatures from the petition, leaving the initiative about 10,000 signatures short of the required 61,123.

The Campaign to Regulate Marijuana Like Alcohol issued the following statement after Maine’s announcement: “We are very disappointed by the Secretary of State’s determination. Based on documents they have provided, it appears that more than 17,000 valid signatures from registered Maine voters were excluded from the count because the signature of a single notary — whose notary commission has not expired — did not exactly match the signature the state has on file for that notary. We are exploring all legal means available to appeal this determination, and we sincerely hope that 17,000-plus Maine citizens will not be disenfranchised due to a handwriting technicality.”

Vermont is clearly pushing the envelope of drug law reform, but it could be several months before questions are answered.

Lynn said he’s just excited that state representatives are even discussing the prospect of legalization.

“It’s not happening via referendum – these are elected officials and they are making decisions to legalize cannabis,” he said. “I’m still kind of scratching my head about this.”

 

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