Senate Majority Leader Chuck Schumer (D-N.Y.) and fellow Democratic Senators Cory Booker (D-N.J.) and Ron Wyden (D-Ore.) unveiled the draft of a historic cannabis decriminalization bill on Wednesday, more than five months after originally announcing it. 

"This is the first time in American history, the Majority Leader of the United States Senate is leading the call to end prohibition of marijuana," Booker said during a Wednesday press conference. "It has been a long journey to this moment."

CONTENTS OF THE BILL

The bill, entitled the Cannabis Administration & Opportunity Act seeks to deschedule cannabis from the Controlled Substances Act, effectively decriminalizing it on the federal level and leaving it to the states to decide whether or not to legalize cannabis. It sets the age for purchase of cannabis at 21 years old, and establishes a 10-ounce purchase limit to prevent trafficking to states where cannabis is not legal. 

The bill also seeks to greenlight interstate commerce, except to states where cannabis is not legal, although those states must allow cannabis shipments to pass through them. The Cannabis Administration & Opportunity Act removes cannabis from the purview of the Drug Enforcement Agency, instead placing the Food and Drug Administration, Alcohol and Tobacco Tax and Trade Bureau, and Bureau of Alcohol, Tobacco, Explosives and Firearms in various regulatory roles. The bill even calls for the creation of a "Center for Cannabis Products" within the FDA to regulate products containing cannabis.

It imposes an excise tax, similar to ones that exist for tobacco and alcohol, of 10 percent in the first two calendar years, gradually climbing to 25 percent over time, and creates a credit of up to 50 percent tax for small companies selling less than $20 million per year.

SOCIAL EQUITY

A major focus of the bill is social equity, specifically redressing harms that decades of punitive drug laws have wrought on vulnerable communities like low-income areas and communities of color. The bill seeks to establish three grant funds. The Community Reinvestment Grant Program, which will be administered by a newly created office within the Department of Justice called the Cannabis Justice Office, will fund nonprofits that provide services like job training, reentry services, and legal aid to individuals adversely impacted by drug policy. The Cannabis Opportunity Program provides funds to states and localities to help socially and economically disadvantaged cannabis business owners get small business loans. The Equitable Licensing Grant Program will provide funding to make it easier for individuals who have been adversely impacted by punitive drug laws to become a part of the cannabis industry. Opportunity Trust Fund programs would be funded by federal cannabis tax revenue, according to the draft of the bill.

The bill also requires expungement of nonviolent cannabis offenses within one year of enactment of the bill and contains provisions to help facilitate resentencing for individuals serving time for nonviolent offenses. It prohibits discrimination based on past use or certain convinctions for cannabis when considering federal benefits or immigration issues for noncitizens. It also authorizes Veteran's Affairs and Indian Health Service doctors to provide recommendations about use of cannabis to patients.

The bill is still in draft form, and the authors have requested substantial feedback from stakeholders that could very well shape what the bill ultimately looks like — as well as how much support it receives.

BANKING AND ACCESSING CAPITAL

Curaleaf CEO Joe Bayern said banking and access to capital are two issues that will be top of mind when offering feedback about the bill.

"In order to build a healthy industry, we need to be thinking about banking aspects of bringing banking changes to the laws in the US, providing capital, not only for companies like Curaleaf, but for social equity players who are going to be entering the marketplace and entering the industry are going to need access to capital and banking services," Bayern said.

The bill may not be finished, but many still took a moment to celebrate the historic nature of the moment.

"Today, we make real progress toward significant cannabis reform. It's long past due to make up for the harm that is disproportionately inflicted on minorities by the War on Drugs," Ascend Wellness Holdings CEO Abner Kurtin said in a statement.

The National Organization for the Reform of Marijuana Laws (NORML) Executive Director Erik Altieri commented that the senators' actions indicate America's leadership is finally listening to what a majority of Americans want. According to Pew Research, some 90 percent of U.S. adults now support legalization of cannabis in some form.

"The days of federal prohibition are numbered," Altieri said.

But not everyone was optimistic. Michael Boniello, managing director of cannabis hedge fund Poseidon Asset Management, worried that the bill may not have adequate support in the Senate, and proposed passage of the Secure and Fair Enforcement (SAFE) Banking Act — a much surer bet he thinks.

"Our main concern over this current legislation is around the ability to get it passed in the Senate. We believe it increases the likelihood that no federal cannabis reform gets achieved in 2021, thus significantly slowing passage of the SAFE Banking Act which enjoys strong bipartisan support," he said in a statement.

Boniello's view isn't unique. Bayern also said SAFE Banking would likely gain more bipartisan support, but added that incremental progress of any kind was valuable.

Curaleaf, Medical Marijuana dispensary, Queens, New York. (Photo by: Lindsey Nicholson/Education Images/Universal Images Group via Getty Images)

"We believe SAFE Banking is the least controversial and has the most support. So for us, that would be a natural next step. But it's important that we continue to move that dialogue forward, that we continue to get some traction as part of this effort because it is a long term journey to legalization," he said.

Sen. Booker, for his part, is among the Democrats vehemently opposed to passing cannabis banking reform independent of any social equity provisions. During a press conference with Sens. Schumer and Wyden on Wednesday, he said, "I don't know about other members of the Senate, but I will lay myself down to do everything I can to stop an easy banking bill that's going to allow all these corporations to make a lot more money off of this, as opposed to focusing on the restorative justice aspect," Booker said.

Cannabis-related bills have been well-received in the House of Representatives, which passed the SAFE Banking Bill twice, and also passed the Marijuana Opportunity Reinvestment and Expungement (MORE) Act in December 2020. 

Concerns over the viability of the Cannabis Administration & Opportunity Act in the Senate are realSchumer admitted he didn't have enough support among his peers at the moment for the current draft of the bill, but said he will "use my clout as Majority Leader to make this a priority in the Senate."

"We don't have the votes necessary at this point, but we have a large majority of our caucus for it," he said.

As recently as April, when Schumer made a speech on the floor of the Senate on cannabis holiday 4/20, Politico reported that two Senate Democrats Sen. Jeanne Shaheen (D-N.H.) and Sen. Jon Tester (D-Montana) were not supportive of legalization, and others were undecided. Schumer would need not only votes from his own party but also some Republican support, as well, to get the bill passed into law.

"We're going to show it to the others and say well what don't you like, what do you like, and we'll see if we can get the support, but we're going to put our muscle behind it, our effort behind it, and we are going to get this done ASAP," Schumer said.

Even if it were to pass the House and Senate, President Joe Biden could represent one last stumbling block. During a press briefing on April 20, White House Press Secretary Jen Psaki noted that full legalization conflicts with the president's comparatively more conservative stance on cannabis. The Cannabis Administration and Opportunity Act proposes decriminalization, which Biden has said he supports, but the bill still goes a few steps further than Biden's own platform, which draws the line at rescheduling cannabis into the Controlled Substances Act, rather than descheduling it altogether. 

In spite of these concerns, many in the industry are still taking a moment to celebrate yet another historic day for cannabis in 2021.

"The people have already spoken. It's time for legislation to catch up to where people are in America. I think this is just another really impactful step forward on that journey and continuing the dialogue about how we eventually create, you know, a national platform for everybody to participate in," Curaleaf's Bayern said.

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