Hawaii Senators Discuss New Marijuana Legalization Bill In Committee, With Plans For Vote Later This Week

February 14, 2023 ·

A Hawaii Senate committee on Tuesday held a hearing on a bill to legalize marijuana—with multiple state agencies weighing in on the proposal in testimony.

The legislation from Sen. Joy San Buenaventura (D) was discussed in the Senate Judiciary Committee. It’s one of two key legalization measures that advocates are tracking this session.

Members of the committee heard from a range of supporters and opponents on SB 669 on Tuesday, with the chair indicating that a vote could come on Thursday.

At the hearing, some witnesses raised concerns that the legislation goes too far in prioritizing existing medical cannabis licensees, and that it has a lack of equity provisions.

The state attorney general’s office submitted testimony opposing the reform, arguing that its enactment would conflict with federal law and that more time is needed to develop comprehensive regulations for the market.

“The Department has serious law enforcement concerns regarding preventing unlicensed activity, and notes that the bill has several provisions that could present confusion on what is intended to be permitted,” the attorney general’s office said.

The state Office of the Public Defender, meanwhile, voiced support for the legalization bill, pointing out that a “marijuana market already exists,” but it “remains underground, and those involved in it largely remains unaccountable.”

“Unregulated sellers do not pay taxes; they do not check identification to ensure that buyers are 21 years old or older; and they do not test the purity of their product,” it said. “Moreover, any disputes that arise in the illicit marketplace are not adjudicated in the courts of law.”

“By contrast, legalization and regulation will allow the State of Hawai‘i to establish legal parameters regarding where, when, and how the cannabis market may operate, similar to the rules and regulations established in the medical marijuana industry. Authorities will actually know who is selling marijuana, where it is being sold, when, and to whom,” the public defender’s office continued.

The departments of transportation, taxation, health and commerce and consumer affairs each submitted comments on the proposal but did not take a position is support or opposition.

Here are some of the main provisions of SB 669

Adults 21 and older would be allowed to purchase and possess up to 30 grams of cannabis and grow up to six plants, only three of which could be mature, for personal use. Adults could also gift marijuana between each other.

An independent Hawaii Cannabis Regulatory Authority would be established under the Department of Health to regulate the industry, as well as the existing medical marijuana program.

The market would initially launch through a pilot program whereby existing medical cannabis dispensaries would be able to obtain a dual license to serve both patients and adult consumers.

Marijuana products would be subject to a 10 percent tax, with revenue going to the state treasury. Cannabis businesses would also be able to deduct businesses expenses as part of the state income tax.

Marijuana vaping products would be prohibited under the legislation.

One of the key problems with the legislation from advocates’ perspective is the lack of components to promote social equity in the industry. Expungements for prior cannabis convictions and licensing priorities for people most impacted by prohibition were not incorporated, for example.

But it remains to be seen what bill might ultimately serve as the vehicle for reform this session, as observers are also following a pair of companion legalization bills sponsored by Rep. Jeanné Kapela (D) and Sen. Chris Lee (D) in their respective chambers.

The Senate version is set to be considered in committee on Wednesday.

Here are the key provisions of that legalization proposal

Adults 21 and older would be allowed to possess up to four ounces of cannabis and grow up to 10 plants in a locked area.

People could buy a maximum of four ounces from licensed retailers every 15 days, and adults could gift cannabis without remuneration.

The state attorney general would need to identify cannabis cases that are eligible for expungement by December 31, 2025 and issue automatic expungements no later than January 1, 2026.

Landlords could not ban possession or consumption of non-inhaled cannabis, with limited exceptions.

A nine-member Hawaii Cannabis Authority would be established, with appointments made by the governor and legislative leaders. The body would be responsible for promulgating rules for the adult-use program and issuing marijuana business licenses.

Existing medical cannabis dispensaries could start applying for dual licenses to serve adult consumers starting January 1, 2024, and those dispensaries would have a three-year exclusivity period.

Businesses that don’t currently have a licensed dispensary could apply for adult-use cultivator and distributor licenses starting January 1, 2024.

Fees and fines would go to a “Cannabis Authority Special Fund” that would cover the administrative costs of implementing the program.

Regulators would be tasked with creating grant, loan and technical assistance programs to support social equity applicants who’ve been disproportionately harmed by the drug war.

Social equity applicants would have 50 percent of their license fees waived for owners who had less than $750,000 in income the prior year.

The state’s medical cannabis law would be amended to allow out-of-state patients to access dispensaries.

The sales tax on cannabis would gradually increase from five percent in 2024 to 15 percent in 2028.

Marijuana businesses would be permitted to deduct business expense at the state level.

Medical cannabis sales would not be subject to a general excise tax.

Local counties could not prohibit marijuana businesses from operating in their jurisdiction.

Delivery services would be prohibited.

Marijuana businesses could establish social consumption lounges.

The criminal prohibition of marijuana paraphernalia would be lifted.

Smoking in public, or anywhere that bans tobacco smoking, would be prohibited. (Full Story)

In category:Legalization
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