Republican U.S. Representative David Joyce of Ohio will soon introduce a new bill to legalize cannabis at the federal level, according to a report from Forbes published on Wednesday.
The new legislation is characterized as a “modernized” version of a bill Joyce introduced in 2019 known as the STATES Act. Although the measure has not yet been formally introduced in the House of Representatives, a draft of Joyce’s new bill is titled the STATES 2.0 Act.
If passed, the legislation would remove cannabis from Schedule l of the federal Controlled Substances Act (CSA). However, cannabis products that are grown or manufactured outside of a state-regulated market would remain illegal under federal law, allowing states that do not want to legalize marijuana a way to maintain prohibition within their jurisdictions.
“States and [Native American] tribes have had enough with the federal government’s half-in-half-out approach that is applied without rhyme or reason,” Joyce, the co-chair of the Congressional Cannabis Caucus, told Forbes in an interview. “Numerous tribes and over 40 states now, including my own, have made it clear that the federal government needs to support their cannabis laws. I’m hopeful this legislation will do just that.”
Despite the popularity of cannabis legalization, political leaders in many states would prefer to keep recreational marijuana illegal. With provisions that maintain the federal illegality of marijuana produced outside of a regulated market, Joyce’s bill allows states to take the lead on cannabis policy.
“This legislation would make it the federal government’s policy to recognize and legitimize the decisions of each state,” said a spokesperson for the congressman. “If the state decides they want to remain prohibitory, the federal government will provide enforcement, if a state decides they want to legalize, the federal government will provide regulation.”
Federal Agencies Would Regulate Cannabis
Joyce’s bill tasks the U.S. Alcohol and Tobacco Tax and Trade Bureau (TTB) with regulating cannabis at the federal level, similar to the agency’s responsibilities for regulating alcohol. The TTB would issue permits for state-regulated cannabis companies, maintain a track-and-trace system to monitor the production and movement of marijuana and cannabis products, collect taxes and enforce penalties. The Food and Drug Administration (FDA) would be responsible for regulating cannabis-infused foods and products that make medical claims under the authority of the Food, Drug and Cosmetics Act.
The federal government’s activities to regulate cannabis would be funded by a federal excise tax, although the bill does not include a specific tax rate. The legislation does, however, call for federal taxes to be set “low enough so as not to exacerbate state taxes,” according to the Forbes report.
Joyce’s bill does not prohibit the interstate trade of cannabis, setting the stage for a truly national market for regulated cannabis. The regulated cannabis industry would also be free of an IRS regulation known as 280e that denies most standard business tax business, a development that would prop up the industry rife with operators struggling to make ends meet because of high taxes and regulatory fees.
Shawn Hauser, a partner at the cannabis law firm Vicente LLP, said that under the bill, “cannabis activity in legal, regulated states would no longer be considered trafficking under the CSA and would be subject to federal regulation and protections, while federal illegality would be upheld in states who have not yet legalized marijuana.”
“This gives us a clear, immediate path to resolving the federal-state cannabis conflict,” Hauser wrote in an email to High Times. “This bill is a promising development as it is a state rights approach preferred by opponents of legalization.”
Andrew Freedman, the executive director of the Washington, D.C.-based nonprofit Coalition for Cannabis Policy, Education and Regulation, collaborated with Joyce and his staff on the bill. He sees this legislation as an avenue to appeal to lawmakers who are currently against reforming the nation’s marijuana laws.
“Despite cannabis pulling at 70%, it remains extremely divisive,” said Freedman. “If we’re going move forward as a country on this, we’re going have to acknowledge the realities of the fact that over half of America now has access to adult-use cannabis, while not saying this has to happen everywhere.”
Freedman added that he believes Joyce’s bill could gain support in Congress, despite the dysfunction in the House of Representatives that culminated with the removal of California GOP Representative Kevin McCarthy as Speaker of the House in October.
“Because it has something today that is helpful to states that don’t want legalization, it has a political power that potentially no other bill has,” Freedman said. “In theory, this has everything that a Republican should want, while moving away from the nonsensical stance the federal government has had on cannabis.”
Joyce drafted the new STATES 2.0 Act in collaboration with several other lawmakers, at least some of whom are expected to sign on as co-sponsors of the legislation. Joyce’s legislative team also received input from stakeholders and groups including Americans for Prosperity, a conservative political advocacy organization founded by billionaire Charles Koch. A spokesperson for Joyce said that the congressman expects to introduce the bill in the House of Representatives sometime this week.
“This is a significant step in the right direction for cannabis reform! Removing marijuana from Schedule I is long overdue, and the STATES 2.0 Act addresses two major concerns for the industry: the unfair 280e tax burden and the limitations on interstate commerce,” Jeffrey M. Zucker, president of Denver-based cannabis consulting firm Green Lion Partners, tells High Times. “Both of these changes are crucial for the responsible growth and development of the legal cannabis market.” (Full Story)