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Montana Lawmakers Approve Cannabis Tax Bill
The Montana legislature has passed a bill to allocate revenue generated by taxes on recreational marijuana.
Montana lawmakers on Monday passed a bill to allocate revenue from taxes on recreational marijuana, sending the bill to the desk of Republican Governor Greg Gianforte for his consideration. The legislation, Senate Bill 442, was approved in a final vote by the Montana Senate on Monday after the state House of Representatives passed an amended version of the bill last week.
Montana voters legalized recreational marijuana in 2020 with the passage of Initiative 190, a ballot measure that passed with nearly 57% of the vote. Under the initiative, a tax of 20% was levied on recreational marijuana products, with revenue generated by the tax reserved for Habitat Montana, a 30-year-old wildlife habitat acquisition initiative often described as Montana’s “premiere habitat program,” according to a report from the Montana Free Press.
Governor Sought Reallocation Of Cannabis Taxes
Before the start of this year’s legislative session, the governor revealed his desire to reallocate the state’s recreational marijuana taxes away from habitat purchases and instead spend the money on law enforcement resources related to legalizing marijuana. Lawmakers responded with several new proposals, arguing that reallocating recreational marijuana taxes would allow the state to meet other pressing budgetary needs and give the legislature more control of the revenue.
In the original version of Senate Bill 442, which was introduced in February by Republican state Senator Mike Lang, a portion of cannabis tax revenue was diverted away from the habitat fund and instead allocated to funding for county roads. Supporters of the proposal maintained that the bill would support access to rural areas and open spaces. But wildlife advocates balked at the proposal, claiming it defied the will of the voters as expressed through Initiative 190.
Lang then amended the bill to divide the bulk of cannabis tax revenue among the state’s general fund, funding for county roads and a new Habitat Legacy Account, which would be used for wildlife improvements on public and private land. Smaller allocations would also be made to fund substance misuse programs, veterans services and funding for state parks and trails.
“I think we’ve made some pretty smart changes here that are intended to invest in rural Montana’s roads, lands and hunting opportunities while providing support for our veterans and a growing need for drug treatment,” Lang said after revising the bill. “At the end of the day we want to give our local counties and local people the tools and resources they need to improve the conditions of the land and be good stewards of Montana.”
The amended bill received support from state lawmakers and groups representing business interests including the Montana Stockgrowers Association and the Montana Petroleum Association, and conservation organizations such as Wild Montana, Helena Hunters and Anglers and the Citizen’s Elk Management Coalition, all registered support for the proposal. Many county commissioners and the Montana Association of Counties also indicated their approval of the measure.
“Our county roads are being used more than ever now,” said Roman Zylawy, president of the Montana Association. “Recreation and agriculture are part of our Montana way of life and this bill recognizes the importance of — and the need for — integration of all through an investment in our county roads. … The Montana Association of Counties thanks you all and we encourage, with the utmost respect, Gov. Gianforte to sign SB 442 and provide ongoing investment in our county roads.”
Competing Bill Dies In Senate
A separate bill that would have directed all cannabis tax revenue to the state’s general fund passed in the House of Representatives last month. Proponents of the measure, House Bill 669 from Representative Bill Mercer, argued that lawmakers would be able to control the allocation of tax revenue and direct it to state budget priorities.
“Under 669, it would simply say that that revenue should go to the general fund and the Legislature as a whole should decide how it wishes to spend that revenue,” Mercer told members of the House Appropriations Committee last month. “One of the reasons that I wanted to bring this bill is that I fear that, when you essentially begin to earmark dollars for special revenue accounts, they evade review on an ongoing basis. Every time we have a diversion into a special revenue account, I worry that it doesn’t get the same sort of scrutiny that it does in the general fund.”
But Jim Vashro, president of Flathead Wildlife Inc said that the will of Montana voters as expressed in the 2020 ballot measure legalizing recreational marijuana should prevail.
“We would hope that the Legislature would listen to the voice of the people,” Vashro said. “We are trying to protect the Habitat Montana funding, which was the stated intent of Initiative 190.”
House Bill 669 was tabled by a Senate committee late last month. Senate Bill 442 has been sent to the governor’s desk and awaits action from Gianforte. On Monday, a spokesperson for Gianforte said that the governor “has substantial concerns” about Senate Bill 442 but did not provide further details on his position.
Source: https://hightimes.com/news/montana-lawmakers-approve-cannabis-tax-bill/
New Mexico regulators fined a cannabis operator nearly $300,000 and revoked its license after the company allegedly created fake reports in the state’s traceability software.
The New Mexico Cannabis Control Division (CCD) accused marijuana manufacturer and retailer Golden Roots of 11 violations, according to Albuquerque Business First.
Golden Roots operates the The Cannabis Revolution Dispensary.
The majority of the violations are related to the Albuquerque company’s improper use of BioTrack, which has been New Mexico’s track-and-trace vendor since 2015.
The CCD alleges Golden Roots reported marijuana production only two months after it had received its vertically integrated license, according to Albuquerque Business First.
Because cannabis takes longer than two months to be cultivated, the CCD was suspicious of the report.
After inspecting the company’s premises, the CCD alleged Golden Roots reported cultivation, transportation and sales in BioTrack but wasn’t able to provide officers who inspected the site evidence that the operator was cultivating cannabis.
In April, the CCD revoked Golden Roots’ license and issued a $10,000 fine, according to the news outlet.
The company requested a hearing, which the regulator scheduled for Sept. 1.
At the hearing, the CCD testified that the company’s dried-cannabis weights in BioTrack were suspicious because they didn’t seem to accurately reflect how much weight marijuana loses as it dries.
Company employees also poorly accounted for why they were making adjustments in the system of up to 24 pounds of cannabis, making comments such as “bad” or “mistake” in the software, Albuquerque Business First reported.
Golden Roots was fined $298,972.05 – the amount regulators allege the company made selling products that weren’t properly accounted for in BioTrack.
The CCD has been cracking down on cannabis operators accused of selling products procured from out-of-state or not grown legally:
- Regulators alleged in August that Albuquerque dispensary Sawmill Sweet Leaf sold out-of-state products and didn’t have a license for extraction.
- Paradise Exotics Distro lost its license in July after regulators alleged the company sold products made in California.
Golden Roots was the first alleged rulebreaker in New Mexico to be asked to pay a large fine.
Source: https://mjbizdaily.com/new-mexico-cannabis-operator-fined-loses-license-for-alleged-biotrack-fraud/
Four marijuana companies, including a multistate operator, have filed a lawsuit against U.S. Attorney General Merrick Garland in which they allege the federal MJ prohibition under the Controlled Substances Act is no longer constitutional.
According to the complaint, filed Thursday in U.S. District Court in Massachusetts, retailer Canna Provisions, Treevit delivery service CEO Gyasi Sellers, cultivator Wiseacre Farm and MSO Verano Holdings Corp. are all harmed by “the federal government’s unconstitutional ban on cultivating, manufacturing, distributing, or possessing intrastate marijuana.”
Verano is headquartered in Chicago but has operations in Massachusetts; the other three operators are based in Massachusetts.
The lawsuit seeks a ruling that the “Controlled Substances Act is unconstitutional as applied to the intrastate cultivation, manufacture, possession, and distribution of marijuana pursuant to state law.”
The companies want the case to go before the U.S. Supreme Court.
They hired prominent law firm Boies Schiller Flexner to represent them.
The New York-based firm’s principal is David Boies, whose former clients include Microsoft, former presidential candidate Al Gore and Elizabeth Holmes’ disgraced startup Theranos.
Similar challenges to the federal Controlled Substances Act (CSA) have failed.
One such challenge led to a landmark Supreme Court decision in 2005.
In Gonzalez vs. Raich, the highest court in the United States ruled in a 6-3 decision that the commerce clause of the U.S. Constitution gave Congress the power to outlaw marijuana federally, even though state laws allow the cultivation and sale of cannabis.
In the 18 years since that ruling, 23 states and the District of Columbia have legalized adult-use marijuana and the federal government has allowed a multibillion-dollar cannabis industry to thrive.
Since both Congress and the U.S. Department of Justice, currently headed by Garland, have declined to intervene in state-licensed marijuana markets, the key facts that led to the Supreme Court’s 2005 ruling “no longer apply,” Boies said in a statement Thursday.
“The Supreme Court has since made clear that the federal government lacks the authority to regulate purely intrastate commerce,” Boies said.
“Moreover, the facts on which those precedents are based are no longer true.”
Verano President Darren Weiss said in a statement the company is “prepared to bring this case all the way to the Supreme Court in order to align federal law with how Congress has acted for years.”
While the Biden administration’s push to reschedule marijuana would help solve marijuana operators’ federal tax woes, neither rescheduling nor modest Congressional reforms such as the SAFER Banking Act “solve the fundamental issue,” Weiss added.
“The application of the CSA to lawful state-run cannabis business is an unconstitutional overreach on state sovereignty that has led to decades of harm, failed businesses, lost jobs, and unsafe working conditions.”
Alabama regulators are targeting Dec. 1 to award the first batch of medical cannabis business licenses after the agency’s first two attempts were scrapped because of scoring errors and litigation.
The first licenses will be awarded to individual cultivators, delivery providers, processors, dispensaries and state testing labs, according to the Alabama Medical Cannabis Commission (AMCC).
Then, on Dec. 12, the AMCC will award licenses for vertically integrated operations, a designation set primarily for multistate operators.
Licenses are expected to be handed out 28 days after they have been awarded, so MMJ production could begin in early January, according to the Alabama Daily News.
That means MMJ products could be available for patients around early March, an AMCC spokesperson told the media outlet.
Regulators initially awarded 21 business licenses in June, only to void them after applicants alleged inconsistencies with how the applications were scored.
Then, in August, the state awarded 24 different licenses – 19 went to June recipients – only to reverse themselves again and scratch those licenses after spurned applicants filed lawsuits.
A state judge dismissed a lawsuit filed by Chicago-based MSO Verano Holdings Corp., but another lawsuit is pending.
Source: https://mjbizdaily.com/alabama-plans-to-award-medical-cannabis-licenses-dec-1/
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