Dec 102014

RBNews #506 – Feds to Protect MedMJ and Hemp States (2014-12-10 Wed)

The final “must pass” federal spending bill that Congress will consider this week includes an amendment that prohibits the U.S. Justice Department from spending any money to undermine state medical marijuana laws.  This amendment would protect the 23 states that have passed traditional medical marijuana laws as well as the 11 states that regulate high-CBD oils.  The spending bill also includes a bipartisan amendment that prohibits the DEA from blocking implementation of a federal law passed last year by Congress that allows hemp cultivation for academic and agricultural research purposes in states that allow it. It also contains an amendment blocking marijuana law reform in Washington, D.C., although it is unclear what exactly the amendment blocks.  Members of Congress have offered differing opinions on whether the language in the spending bill stops Initiative 71, which legalized personal marijuana cultivation and possession, or just prohibits D.C. from going further and enacting legalized marijuana markets.

The Oregon Liquor Control Commission can begin implementing Measure 91, which legalized recreational marijuana in the state, thanks to a vote Wednesday by the Emergency Board.  The board, which is comprised of state House and Senate members, approved a $583,000 loan for the OLCC so it can hire staff, pay for legal advice and begin its outreach efforts.  The money is coming from the state’s liquor dollars with the promise that the OLCC will pay it back by the end of the 2015-17 budget cycle using revenue generated by marijuana sales.  The agency has many regulatory tasks ahead of it, including how to decide where marijuana can be grown and sold, how it should be labeled and whether to allow medical growers and dispensaries to participate in the recreational industry.

The Eastern Washington man who wanted to give $14,000 of his pot auction proceeds to the local school district has finally found a willing recipient.  The Prosser School District rejected his offer, explaining it would not be in the interest of students.  Then the Prosser branch of the Boys and Girls Club also just said no to the marijuana money.  Williams said he eventually gave $1,000 to the local VFW Post and $13,000 to a local needy family, which asked not to be identified.  Locals thought the schools and the club were unwise to reject the gift, with one man noting, “They take money from the lottery, they take money from the wineries, they take money from breweries, distilleries, and some of the marijuana tax that’s going to the state is coming back to them. They should have taken the money.”

The Puyallup, Washington, City Council voted 5-2 Tuesday to prohibit all recreational marijuana producers, processors and retailers. But the council stopped short of banning medical marijuana shops and collective gardens after overwhelming opposition from patients.  The regulations come just before a Dec. 31 expiration of a moratorium that was extended several times over the last 16 months.  The delay was intended to give city officials time for research and deliberation about Initiative 502, which voters approved in 2012 to create a regulatory system for recreational marijuana. Conflicting pot laws and concerns about I-502’s lack of revenue-sharing with local governments prompted the proposed ban.  Tuesday’s council vote went against a planning commission decision from January that recommended the city allow the businesses in certain areas of the city.

Uruguayan high school students, like Americans, are smoking more marijuana than tobacco.  A nationwide survey on drug consumption released Wednesday by the National Drugs Board says 17 percent of high schoolers said they smoked pot in the past year versus 9 percent for tobacco. It’s the first time since the survey began in 2003 that marijuana consumption is higher than tobacco use among high school students.

One of the many difficulties marijuana-related businesses face is the lack of contract enforcement.  When one cannabusiness filed for bankruptcy in Denver in 2012, it was denied protection by Federal Judge Howard Tallman because it was a marijuana-related business.  “Federal law trumps state law,” said Bob Hoban, a cannabis attorney in Denver. “In any federal court, involving marijuana, the judge is bound to invalidate contracts or the party’s right to bankruptcy protection, because marijuana is still federally illegal.”  Without bankruptcy protection, marijuana businesses are not allowed to dissolve or disappear without paying back debt obligations and instead face debt collection by judgment enforcement, which includes placing liens on real estate, garnishing wages, seizing property and freezing bank accounts.  Courts also have a history of voiding promissory notes, employment contracts, leases and other business contracts when the subject matter involves marijuana cultivation or distribution.