Governors tell Attorney General Sessions and Treasury Secretary Mnuchin, “Changes that hurt the regulated market would divert existing marijuana product into the black market and increase dangerous activity in both our states and our neighboring states”In an apparent response to the marijuana crackdown hinted at by the Trump Administration, the governors of the first four states to have regulated cannabis sales for all adults sent a letter on Monday to Attorney General Jeff Sessions and Treasury Secretary Steve Mnuchin. The letter urges the Trump Administration to maintain existing policies related to the enforcement of federal marijuana laws.
In addition to providing justifications for maintaining existing policy, the governors also asked for the opportunity to engage with Administration officials prior to any possible change in regulatory or enforcement systems.
The signatories on the letter are Governor Kate Brown of Oregon, Governor John Hickenlooper of Colorado, Governor Jay Inslee of Washington, and Governor Bill Walker of Alaska. Since November 2012, each of these states, following the passage of ballot initiatives by the voters, has regulated the cultivation, production, and sale of cannabis for all adults.
In November 2016, the voters of California, Maine, Massachusetts, and Nevada passed similar measures. Those states are now or soon will be in the process of crafting adult-use cannabis regulations.
The National Cannabis Industry Association (NCIA) welcomed this proactive approach from the governors and echoed the sentiments contained in the letter.
“There is no denying that regulated cannabis businesses are preferable to underground markets dominated by gangs and cartels,” said NCIA executive director Aaron Smith. “The regulated markets are creating jobs, generating tax revenue, and taking marijuana sales off the streets.
“The Trump Administration should be working with the states to ensure the regulated markets are functioning properly and safely, not working against the states to shut them down,” Smith said. “We hope, following this written request, there will be a thoughtful and productive dialogue between state and federal officials.”
The heart of the letter to Attorney General Sessions and Treasury Secretary Mnuchin is the following paragraph, which details the dangers of changing current policy and underscores the benefit of maintaining the status quo:
“The Cole Memo and the related Financial Crimes Enforcement Network (FinCEN) guidance provide the foundation for state regulatory systems and are vital to maintaining control over marijuana in our states. Overhauling the Cole Memo is sure to produce unintended and harmful consequences. Changes that hurt the regulated market would divert existing marijuana product into the black market and increase dangerous activity in both our states and our neighboring states. Likewise, without the FinCEN guidance, financial institutions will be less willing to provide services to marijuana-related businesses. This would force industry participants to be even more cash reliant, posing safety risks both to the public and to state regulators conducting enforcement activity. The Cole Memo and FinCEN guidance strike a reasonable balance between allowing the states to enact reasonable regulations and the federal government’s interest in controlling some of the collateral consequences of legalization.” [emphasis added]
Read NCIA’s white paper providing real-world examples of how 280E harms small businesses across the country.