Recreational marijuana states undeterred by hints of federal crackdown

Despite ominous overtones from the White House, the eight states that have legalized recreational cannabis are proceeding full-bore, whether it’s with running their existing programs or preparing to launch new ones.

Governors and attorneys general responded in unison: They’ll honor voters’ wishes and conduct business as usual while awaiting specific policies.

The cannabis industry’s future was called into question Thursday when President Donald Trump’s press secretary, Sean Spicer, said “greater enforcement” could be on the horizon for recreational marijuana. He indicated that medical cannabis likely would be immune from any potential crackdown.

Though Spicer said it’s a Department of Justice decision whether to take action against the adult-use cannabis market, a DOJ spokesperson said the agency had no comment on the issue.

Regardless, Spicer’s comments – the first by the Trump administration on state-legal cannabis markets – were enough to get those in the industry as well as elected officials talking about how the federal government might approach rec businesses.

Differing approaches

A spokeswoman for Massachusetts Gov. Charlie Baker indicated Friday the state will be moving forward as it implements a recreational marijuana industry approved in November.

“… The voters of Massachusetts have spoken on this issue,” Lizzy Guyton, Baker’s communications director, wrote in an email to Marijuana Business Daily, “and the administration will continue to work with lawmakers, educators, public safety and public health professionals to move forward with the new law.”

Meanwhile, other states are taking a wait-and-see attitude.

“It would be premature to speculate on what the administration may or may not do,” Mark Bolton, marijuana adviser to Colorado Gov. John Hickenlooper, wrote in an email to Marijuana Business Daily. “We have worked with the Department of Justice since legalization (in 2012) to develop a framework that respects voters and promotes public safety.”

A spokesman for California Gov. Jerry Brown wrote, “Until we see an actual proposal or plan for action, we won’t be commenting.”

But in a letter to Trump on Friday, Lt. Gov. Gavin Newsom urged the president not to crack down on adult-use marijuana businesses that will operate under California’s new rec program.

“The government must not strip the legal and publicly-supported industry of its business, and hand it back to drug cartels and criminals. Dealers don’t card kids,” Newsom wrote. “We have a shared goal of reducing crime, and the best way we can achieve that is through a tightly regulated market.”

Mari St. Martin, communications director for Nevada Gov. Brian Sandoval, wrote that Sandoval “has been concerned” with the conflict between federal and state marijuana law. Martin also wrote that Sandoval’s office is “actively monitoring any potential action by the Department of Justice regarding ‘greater enforcement’ of federal drug laws” and that the state “will review any financial consequences” resulting from a possible crackdown.

State officials said Friday that Nevada still plans to launch recreational marijuana sales in July, the Associated Press reported.

Alaska Department of Law spokeswoman Cori Mills wrote on behalf of Gov. Bill Walker:  “As to what enforcement actions the federal government might initiate, it’s unclear at this point. Until the federal government takes an action, we can’t speculate on what might or might not occur.”

Washington state AG defiant

Attorneys general from many rec states were also hesitant to jump to conclusions, although Washington state AG Bob Ferguson was vociferous in his defense of the state’s MJ program.

Ferguson took to Twitter to vent his frustration and also noted that he and Gov. Jay Inslee wrote to U.S. Attorney General Jeff Sessions on Feb. 15 requesting an audience to discuss the future of the cannabis industry (as of Friday morning, a Ferguson aide said, there had been no response from Sessions).

“I will also be very clear with AG Sessions that I will defend the will of Washington voters,” Ferguson wrote on Twitter. “My office will use every tool at our disposal to ensure that the federal government does not undermine Washington’s successful, unified system for regulating recreational and medical marijuana.”

And in Maine, Attorney General Janet Mills said in a statement “it would be an unwise use of federal resources … to focus on marijuana prosecutions in a state like Maine,” the Portland Press Herald reported.

“In Maine,” she added, “we are working very hard to accommodate the desires of the voters to allow the recreational use of marijuana and the need to regulate its cultivation and distribution in a manner consistent with the health and safety of the public.”

DOJ options

If the justice department were to ramp up enforcement of federal law against adult-use marijuana businesses, it’s unclear how such action would unfold.

The DOJ has two inexpensive and easy avenues in which to try to undercut the adult-use cannabis industry.

Tell U.S. attorneys to send cease-and-desist letters to companies already in operation.

Mail threat letters to public officials who may oversee future rec businesses in an attempt to quash licensing before it begins.

Another option for Sessions would be to try to scare businesses into shuttering their doors with a small number of raids in, say, Denver and Seattle.

In that case, however, the Drug Enforcement Administration likely does not have enough field agents or adequate finances to literally go door-to-door to shut down every rec marijuana company in operation. Plus, the DEA still has plenty of other duties, former DEA chief of staff Jodi Avergun pointed out earlier this month to Marijuana Business Daily.

If Trump or Sessions were to decide they want to start a pitched legal battle over recreational marijuana, the DOJ could file suit against Alaska, Colorado, Oregon and Washington for permitting adult-use sales.

In that scenario, it’s anybody’s guess as to how the situation would play out, but it could take years and eventually end up before the U.S. Supreme Court.

Special Thanks to  John Schroyer & Marijuana Business Daily

 

About
“If you can't figure it out, figure out a "work-around!" The NestEggg Group was founded with a firm belief that working exclusively with professional firms to help them see past their history into the potential of their futures. Your potential is limited only by your creativity. Jeff's business purpose— “why”—centers on changing results through viewing things in new ways. He expounds: “Changing our results requires changing our actions. Because what we do proves what we believe, only when we change our beliefs can we progress. New insights are what cause us to shift our beliefs.” So what results do you want to attain? Call Jeffrey (1-888-987-NEST) when it’s time for progress. About Robert "Jeffrey" Wolter, President The NestEggg Group, Inc & EgggsAct Tax, Inc. & Managing Member NestEggg Investment Advisors Jeffrey is a common sense and productivity strategist. He facilitates and teaches about growth, positioning, and pricing strategies; leadership; operations; business communications and philanthropy. What he does best—differently from others—is energize people while he shows them how to solve business effectiveness. He clarifies the intricate, huts new light. He encourages hope. He sets you up to make development possible. Jeffrey is recognized for his original ideas and success with practical implementation, even as he challenges the "norm". Jeffery is a skilled facilitator. His deep knowledge of his firm(s) operations and ability to understand the intricacies of All of his clients, gives way to sharp observation skills allow his grasp a firm’s nuances quickly. He then guides firm owners and their teams on their unique paths toward improved profitability, smoother operations, stronger cultures and how and when to give back. Since 1998, he's helped more than 5,024 QuickBooks users and business owners achieve results such as: expanding revenues, attracting and inspiring talent, aligning operations with long-term objectives, discovering and leveraging their differentiation, substantially increasing sales and proposal results, strengthening relationships with their clients, and finding more joy in their work. His 25+ year career background includes roles as entrepreneur, finance director, board of director for several nonprofit, creative business development, insurances agency owner, Wealth Management Firm owner, editor, Tax Specialist, Accounting Director, Mediator and more. Before creating his firm in 2007, Jeffrey was an accountant for several well know local firms and individuals. After building a successful accounting practice, he became intrigued and inspired by the uniqueness of how Insurance, Investment's/Wealth Management, Taxes and Accounting/Bookkeeping all tend to work together, he branched out and created his list of Affiliate Companies in 2012 & 2013 In 2013, joined the Intuit Accountants Council and has assisted in the continued enhancement of the popular QuickBooks (Desktop and Online versions) and did so until late 2015. In 2014 with the legalization of Marijuana, Jeff and his team have committed themselves to knowing as much about the industry and being there to offer Cannabis Compliant, Accounting, Tax & Insurance to business owners that have or need help in keeping in with the Federal government's "280E"
Contact Us

Send us an email and we'll get back to you, asap.

Not readable? Change text.