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.
