Wednesday is the deadline to submit comments on a draft Senate bill to federally legalize marijuana, and feedback has flooded in from a broad array of advocates and industry stakeholders.
While legalization proponents have widely celebrated the introduction of the Cannabis Administration and Opportunity Act (CAOA), they have some suggestions for improvement—principally as it concerns issues of social equity, licensing, tax policy and interstate commerce.
Senate Majority Leader Chuck Schumer (D-NY), Senate Finance Committee Chairman Ron Wyden (D-OR) and Sen. Cory Booker (D-NJ) are the lead sponsors of the legislation, and after releasing a draft version of the measure in July, they opened a public comment to receive input on what will be a revised measure the senators plan to formally introduce.
Pro-reform organizations like NORML, Marijuana Policy Project (MPP), National Cannabis Industry Association (NCIA) and Hemp Roundtable made their voices heard—and while they generally applauded the senators’ work to end federal cannabis prohibition, they had some recommendations for revisions. Prohibitionist groups also weighed in with thoughts about the proposal can be changed to better reflect their concerns with the overall policy of legalization.
Here’s an overview of the public comment that the senators have received on their marijuana legalization bill:
The Marijuana Justice Coalition—which counts among its membership the ACLU, Center for American Progress, Drug Policy Alliance, Human Rights Watch, Leadership Conference on Civil & Human Rights, MoveOn, Students for Sensible Drug Policy and United Food and Commercial Workers International Union—sent a joint letter on the legalization proposal.
It said that the “regulatory approach taken by the CAOA is generally modeled on the federal approach taken to regulate alcohol and tobacco,” and while the draft measure “includes critical elements to end federal criminalization and to undo and repair many of the harms resulting from criminalization, it seeks to regulate cannabis like a vice, meaning a consumer product with potential harms to public health and huge economic potential.”
The coalition recommended “an approach [to reform] that does not just include reparative justice, health equity, and community reinvestment as a subset of a larger policy reform, but rather an approach where these components are the primary goal.”
“As we move forward, it is necessary that the Senate work alongside the House, as well as the Marijuana Justice Coalition and other key stakeholders, to ensure we build a bill that is greater than the sum of our parts. We encourage the Senate to hold a hearing on the issue of federal cannabis reform this year in order to inform our work on this bill moving forward.”
The consumer-focused group’s comments largely center on the need to help repair the harms of prohibition for those who have been criminalized over cannabis, ensure that there are regulations in place to prevent the corporate consolidation of the industry and protect the infrastructure of existing state markets.
The organization also surveyed advocates and included its findings in its comment letter. Seventy-three percent of respondents said including provisions to expunge past records is either very or somewhat important to them, for example. And 68 percent said the legislation should end drug testing for cannabis.
“For too long, the criminalization of cannabis has been a tool used to disrupt communities and foster distrust of law enforcement,” the letter says. “It is our sincere hope that your team will be successful in collaborating with your colleagues and other good-faith stakeholders to ensure that the impending shift in federal policy takes great strides toward rectifying this situation by advancing comprehensive reform that is centered in science, evidence, and rational thought.”
Justin Strekal, political director of NORML, added that the “CAOA draft represents a thoughtful path forward toward ending federal marijuana criminalization.”
MPP stressed in its letter that while federal legalization is necessary, the rollout should be thoughtful and gradual, giving deference to states so as to avoid jeopardizing efforts to promote equity in the industry.
“While we are enthusiastic about the goals of the CAO Act Discussion Draft, we believe the regulatory aspects need significant clarification and revision to avoid unintended consequences,” Karen O’Keefe, state policies director for MPP, wrote. “Our two major areas of concern are: the possible upending of state licensing and regulatory systems—driving sales underground—and the impact on medical cannabis access, including for those under the age of 21.”
The group also called for more robust provisions to provide relief for those impacted by marijuana criminalization and dedicate more tax revenue to communities hardest hit by prohibition.
MPP additionally proposed policies aimed at protecting medical cannabis patients and dispensaries, including by eliminating any federal tax on medical marijuana.
“The vast majority of Americans support legalizing cannabis for adults,” O’Keefe wrote. “Congress must work to swiftly end federal cannabis prohibition through an approach that starts with a framework of deference to states and includes a slow transition, avoids burdens that will drive the market for cannabis products back underground, and stops destroying lives—disproportionately those of Black and Brown Americans—over a plant that is safer than alcohol.”
NCIA said that it solicited feedback on the draft legalization bill from stakeholders large and small to inform its comments.
It discussed testing standards for cannabis products, interagency regulatory coordination, access to federal aid for marijuana businesses, the need to allow states to set retail sales limits and more.
“Given your demonstrated focus on engaging with the people most directly impacted by cannabis policy reform, we hope the breadth and depth of our feedback will enable you to enact sound legislation which fosters the growth of a thriving and equitable legal cannabis industry,” the organization said. “NCIA is committed to creating a vibrant legal industry that can sustain thousands of well-paying jobs while responsibly serving adult consumers and medical patients who rely on cannabis for relief.”
“That this bill looks to create restorative justice and to consider the complexities of how communities were negatively and disproportionately impacted by cannabis prohibition is of the utmost importance, and is greatly appreciated. In order to achieve this, we are encouraged that this discussion draft will result in the continued dialogue that is necessary to ensure that individual states do not continue to perpetuate illicit markets.”
USCC, like other organizations, told the senators that it feels the Treasury Department’s Alcohol and Tobacco Tax and Trade Bureau (TTB) should be the primary regulators for the cannabis industry.
It also noted that the complexity and diversity of marijuana production in states requires “a new model of taxation, at rates that do not fuel the illicit market.”
Further, USCC said that federal legislation should account for legal obstacles in state markets and ensure that there’s a more gradual, transitionary process after a given state legalizes marijuana before being subject to federal rules that could disrupt social equity goals.
“We are fully aligned with the sponsors’ goals and applaud their leadership and careful consideration,” Steven Hawkins, CEO of USCC, said in a statement. “Cannabis prohibition in America is coming to an end, and the draft legislative text provides a road map for transitioning to a more just, equitable and prosperous future, particularly for emerging and social equity businesses and those directly impacted by cannabis prohibition.”
“At the end of the day, the detailed policy conversations taking place around the CAO Act should not distract from its historic nature. We support the leadership and vision of the sponsors and look forward to ongoing discussions and engagement to advance this vital legislation.”
SSDP said that the drug war “has inflicted incalculable harm on marginalized communities—particularly communities of color,” and that war” weaponized cannabis over the last 50 years with disgustingly successful results.”
The organization said it appreciates the senators’ work to correct these issues, but it did offer some proposed revisions, including preventing the criminalization of people under 21 for marijuana. It further recommended eliminating restrictive language on who could qualify for federal relief after legalization is enacted.
“While fueling the public health crisis of mass incarceration, marijuana prohibition targeted the foundation of [marginalized] communities, leaving countless youth without guidance, an incalculable amount of economic loss, and millions of families suffering the loss of loved ones,” SSDP said in its comments. “The time has long since past to put this nightmare to an end.”
ASA, which focuses on access for medical cannabis patients, touched on a number of prompts that the senators said they were especially interested in, such as appropriate ways to measure potency, agency responsibilities for regulating the marijuana market and the composition of a federal advisory board on cannabis.
Much of the group’s comment letter centers are ensuring that patient access to cannabis is not negatively impacted by federal regulations.
The organization also made recommendations for the legislation to address the denial of federally assisted housing to people who use cannabis in compliance with state laws and encourage the U.S. Department of Health and Human Services and U.S. Department of Veterans Affairs (VA) to “develop a cannabis physician education curriculum for VA and civilian physicians.”
ATACH said that one of its primary concerns is giving regulatory authority over cannabis to Food and Drug Administration (FDA), and it advised the senators to consider the possible role of TTB within the market.
Michael Bronstein, president of ATACH, further explained that the comments address “the need for increased recognition and understanding of the interaction with existing state-level regulatory frameworks, the treatment of hemp and CBD, and taxation policy.”
Like several other organizations, ATACH said the rollout process for federal regulations should be gradual to prevent undue burdens on existing state markets.
“ATACH is thankful for the dedication of the sponsors for taking these historic next steps and appreciates the opportunity to continue the dialogue regarding appropriate federal rates and tax structure, and how they interact with existing state and local taxes,” Bronstein said.
“The draft bill represents a pivotal moment for the cannabis industry and an opportunity for stakeholders to inform a pathway towards responsible federal cannabis regulation that is rooted in science, evidence and data, ensures public health and safety standards, and secures fair market access including for small and minority-owned businesses,” CPEAR, which comprised largely up of alcohol and tobacco companies, said.
The group submitted comments that include recommendations on developing regulations that curb the illicit market, respecting state cannabis markets and providing “meaningful economic opportunities for small and minority-owned businesses.”
“Cannabis holds an important place in American history and society today as much as it will have an important place in the future,” CPEAR said. “It is critical that any attempt to craft and implement federal guidelines is done so with a holistic approach, led by science and data, but considerate of criminal justice, social equity, and public health. CPEAR appreciates the opportunity to be a resource to the Sponsoring Offices as this legislative effort continues to evolve.”
Last week, Polis sent his letter to the Senate sponsors of the reform bill that urged them to pass incremental cannabis banking and tax reform first before moving forward with the comprehensive legislation to end prohibition.
The governor said he’s supportive of CAOA—but he insisted that there are more modest and practical steps that should be taken first to support state-legal markets and protect businesses.
“I am thrilled that you are bringing forward a long-term, comprehensive solution that deschedules cannabis while enhancing social equity pathways,” he wrote. “I hope that you will first focus your efforts on the two biggest barriers to the success of the cannabis industry: banking and IRS Code Section 280E.”
That latter statute has precluded state-legal marijuana businesses from making federal tax deductions that are available to other traditional industries.
The attorney general of Colorado last week sent a letter asking congressional leaders to ensure that small marijuana businesses are protected from being overtaken by Big Tobacco and other major industries as federal cannabis reform legislation advances.
Weiser wrote that his state is “heartened” to see efforts on Capitol Hill to end federal cannabis prohibition and create a regulatory framework that still empowers states to make their own policy decisions. But he expressed concerns about large corporations potentially gobbling up the industry if preventative steps aren’t taken.
Ensuring that small businesses are empowered to participate in the marijuana industry is a major priority, the attorney general argued. And, therefore, the official said a national market should be rolled out in thoughtful way to prevent large corporations from overtaking the industry.
“If a national market is not rolled-out carefully and in stages, large companies, particularly existing tobacco-focused companies, will be able to move into new markets immediately, displacing and pushing out smaller players,” he wrote.
The hemp advocacy group provided senators with some tips for how it thinks CAOA could be improved. It provided five recommendations to that end:
“The legislative prospects of the CAOA are still uncertain, but as legislation makes its way through both houses of Congress, we are working very hard to make sure that the details are reflective of the best interests of the hemp and CBD industries,” the group said.
The Parabola Center, a newly formed group that is working to inform legalization legislation federally and at the state-level with the intent of promoting social justice-centered reforms, has been actively monitoring reform efforts in Congress. And it previously recommended changes to a House legalization bill that cleared the chamber last session and has been reintroduced this year.
In its comment letter to the senators, the organization emphasized the importance of creating “a legal cannabis sector that lifts us out of a long history of systemic racial and economic oppression stemming from prohibition and into a fair, open, and competitive market that is part of a new framework focused on justice and restorative practices.”
Parabola expressed concern over the rapid consolidation of state-legal marijuana industries, and it said that members have observed “large current operators jockeying to dominate the market in various states and regions.”
It said that, as written, CAOA could thwart progress states have made toward promoting social equity in the marketplace. But there are steps that can be taken to avoid that issue.
“Our goal is to avoid irreversible market consolidation, and instead create a gradual approach to national legalization that favors an ecosystem of small businesses over a handful of excessively large ones. In short, our proposed changes to CAOA allow regulating agencies to collect data, monitor states, and develop expertise. That knowledge and expertise should then be used to create fair and equitable rules for everyone – and in the meantime prevent the formation of corporate oligopolies in the cannabis sector and closely-related ancillary industries.”
Some of the principal recommendations that Parabola shared with the senators include 1) take more concrete steps to incentive states to maintain equitable markets by, for example, tying federal funding to “defined justice benchmarks,” 2) outline a more gradual path for interstate commerce and 3) prohibit vertical integration and ensure that anti-competition provisions are included in the legislation and 4) prevent large tobacco companies from participating in the marijuana industry.
“While we applaud Senate Majority Leader Schumer, as well as Senators Booker and Wyden, for their focus on exploring ways to mitigate the harms that have been perpetuated on vulnerable communities, full commercial legalization of today’s highly potent marijuana will only deepen these harms,” Kevin Sabet, president of SAM, argued.
“Decriminalization of minor marijuana possession and expungement of previous records was a key part of President Joe Biden’s platform and should be the path forward, but we cannot let the interests of the for-profit marijuana industry and its investors cloud the discussion,” he said. “Much as we have done with COVID, we must heed the science and be cautious with normalizing and promoting marijuana use.”
SAM said in its letter that while it would prefer not to federally legalize cannabis, its scientific advisory board has several recommendations if comprehensive reform is to be enacted. It wants a 10-15 percent cap on THC concentrations in marijuana products, a ban or significant restrictions on advertising and a prohibition on “flavored or child-friendly products.” There is some common ground on one proposal: both SAM and several advocacy organizations feel that Big Tobacco and Big Alcohol should be prevented from monopolizing the market.
In a call-to-action campaign, CADCA encouraged members to submit a pre-written letter to the senators that expresses concern about the commercialization of cannabis.
The letter says that the “CAOA purports to be about decriminalizing marijuana,” but it would “totally legalize the cultivation, production, distribution and sale of marijuana, thus totally commercializing a new addictive and harmful substance.”
It’s unclear how long after the comment period ends that the bill will be finalized, formally filed and referred to committee. But Schumer has said on multiple occasions that he intends to bring the proposal to the floor “soon.”
As introduced, the legislation would federally deschedule cannabis, expunge prior convictions, allow people to petition for resentencing, maintain the authority of states to set their own marijuana policies and remove collateral consequences like immigration-related penalties for people who’ve been criminalized over the plant.
The bill would also impose a federal tax on marijuana products and put some of that revenue toward grant programs meant to support people from communities most impacted by prohibition who want to participate in the industry.
Further, the legislation would transfer regulatory authority over cannabis from the Drug Enforcement Administration (DEA) to FDA, the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the TTB.
There have been some serious questions about whether the three senators will be able to muster the 60 votes needed to pass the legislation in their chamber. Even with a slim Democratic majority in the Senate, there are some members of Schumer’s own party who’ve expressed concerns about the comprehensive reform.
President Joe Biden’s position on cannabis presents another complication. Minutes after the senators unveiled the bill, White House Press Secretary Jen Psaki was asked at a briefing about the administration’s position on the legislation and said “nothing has changed” with respect to Biden’s opposition to adult-use legalization.
In the days following the introduction of CAOA, Booker had repeatedly stressed that he wants to see this legislation pass before allowing incremental reform to advance such as a bipartisan bill to protect banks that service state-legal marijuana businesses from being penalized by federal regulators.
The senator recently vowed to “lay myself down” to block any other senators who seek to pass marijuana banking legislation before the body approves comprehensive cannabis reform, igniting the controversy.
He’s taken some criticism from stakeholders on that position—though he later clarified that he simply feels that holding off on voting on the banking reform as a “sweetener” could encourage his colleagues to support more comprehensive legislation.