Legislative Report 3/5/2020 - Legislature Moves to Regulate and Tax Cannabis

The week before Town Meeting was intense as the legislature spent long hours debating, amending, and passing two major bills: the regulation and taxation of legal cannabis and revisions to Act 250. Both are very complicated pieces of legislation, so I will focus this article on the 53-page cannabis bill, S.54.

The history of cannabis, a.k.a. marijuana, in Vermont law dates back more than 100 years.  Vermont outlawed marijuana in 1915 as part of a movement to restrict its usage throughout the United States in the early 20th century.  Its presence in Vermont was well-known, however, during the “back-to-earth” movement in the 1970s and, truthfully, never left. It was approved for medicinal use with “a note from the doctor” in 2004 by a bill that Governor Jim Douglas allowed to become law without his signature. In 2013 the legislature decriminalized possession of up to an ounce; i.e. it became a civil infraction. Finally, in May of 2017, the legislature passed a bill legalizing adult possession of one ounce and possession of two mature plants per household, but the bill was vetoed by Governor Scott. However, the following January the House passed an amended version, the Senate followed, and Governor Scott signed it into law. So, while it is legal to possess marijuana in small quantities, it has not been legal to buy or sell it or bring it into Vermont, including marijuana seeds.  It is a highly dysfunctional system in which the black market continues to thrive.

Because of the need and desire for strict regulation, the production and sale of cannabis will be considered a business rather than “farming” and will not be eligible for agricultural tax breaks. However, sections of the Required Agricultural Practices related to operating standards for farming, groundwater quality, and subsurface tile drainage will apply to cannabis cultivation, processing, and manufacturing.

The bill we just passed creates a Cannabis Control Board that will issue licenses and regulate all aspects of the marijuana market in Vermont. There are six types of licenses: Cultivator, Product manufacturer, Wholesaler, Testing laboratory, Retailer, and an Integrated license. A person may hold a maximum of one of each license, except that an integrated license is only available to the current five vertically integrated registered medical cannabis dispensaries in Vermont. Retail cannabis establishments are allowed in a municipality only if the voters of the municipality approve. Other types of licensees cannot be disallowed, but must comply with any local bylaws, ordinances, or permits. The bill bans advertising related to cannabis and requires cannabis and cannabis products intended for human consumption to be tested for contaminants, potency, and quality. All cannabis products remain illegal for persons under 21 years of age.

Taking into consideration roadside safety, all Vermont officers will be required to take 16 hours of Advanced Roadside Impaired Driving Enforcement (ARIDE) training by the end of 2021, and roadside test results and Drug Recognition Expert (DRE) evaluation results will be admissible in court.

A 14% excise tax and the regular 6% sales tax will be assessed on retail marijuana sales. Any local option tax will also apply.  Expected revenues during the first year are around $13M. The revenues from the sales tax will go into the Education Fund for after-school programs, 30% of the excise tax revenue will be used for prevention programs, and the rest will go to the General Fund. The bill is now back in the Senate for its approval or further amendment.

I have been honored to be able to serve you in the legislature and work for the improvement of our environment and quality of life. I’m taking this opportunity to announce that I will be running for re-election again this year and would appreciate your continued support.  I welcome your emails (myantachka.dfa@gmail.com), phone calls (802-233-5238), or in-person contacts.