Cannabis News of Note for the Week:
Cannabis Business Times: Where All 100 US Senators Stand on SAFER Banking Act
Green Market Report: DEA chief dodges marijuana rescheduling questions from Congress
Punchbowl News – The Vault for 5/5: After the FAA scramble, what’s left for economic policy? (paywalled newsletter, full text below)
Politico Pro Cannabis (5/6): Cole Memo Author Calls for Unified Guidance from Feds (Paywalled newsletter, full text below)
Wall Street Journal: Reclassifying Marijuana Could Unlock Billions in Tax Savings for Cannabis Companies (paywalled, full text attached)
Green Market Report: Unanswered questions abound for cannabis stakeholders over rescheduling
Cannabis Reports of Note for the Week:
Congressional Research Service: The Federal Status of Marijuana and the Policy Gap with States
Marijuana Policy Project: Cannabis Tax Revenue in States that Regulate Cannabis for Adult Use
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Politico Pro Cannabis (5/6): COLE MEMO AUTHOR CALLS FOR UNIFIED GUIDANCE FROM FEDS — It would be good for federal agencies to produce unified enforcement guidance for marijuana following reclassification, says former U.S. Deputy Attorney General Jim Cole, who authored the Justice Department’s Cole Memo in 2013.
The Cole Memo was Obama-era guidance stipulating that DOJ would not prioritize enforcing federal cannabis laws in state-legal marijuana markets. It was repealed by then-Attorney General Jeff Sessions in 2018, with new instructions that each U.S. attorney should use their own judgment in enforcing federal law regarding cannabis.
“Having disparate enforcement actions isn’t useful for the industry,” Cole — who no longer works for the DOJ — pointed out on a call last Wednesday following the announcement that the DOJ planned to reclassify marijuana. The call was organized by cannabis industry groups and the Coalition for Cannabis Scheduling Reform.
Cole said the DOJ would likely determine after reclassification if any more guidance on federal enforcement was necessary. He added that he wouldn’t be surprised if a new memo was issued to ensure that prosecution of the illicit market is stepped up.
The Cole Memo’s repeal has not resulted in a crackdown by the DOJ against state-legal industries. But other agencies have undertaken enforcement from time to time: The Department of the Interior removed medical marijuana plants from tribal land in 2017 and 2021, despite their legality at the state level. And recently, the Department of Homeland Security has been confiscating marijuana from state-licensed businesses at checkpoints in New Mexico.
That’s why, Cole said, it would be good for the DOJ and other agencies to get on the same page. He acknowledged it’s tough to get agencies to work together on something like this, but it isn’t impossible.
Howard Sklamberg, a former top FDA official, was also on the call. He said that even if new guidance were to only come from the Justice Department, it would still inform the enforcement choices made by other agencies, because the DOJ is the enforcement arm of the U.S. government. If a separate agency wanted to bring federal charges against someone, they would still need to go through the DOJ to do that.
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Punchbowl News – The Vault for 5/5: After the FAA scramble, what’s left for economic policy?
FAA reauthorization — it was fun while it lasted.
Less than a month since we first reported a push from senior House lawmakers to use the FAA bill as a vehicle for financial policy, the effort has fizzled. And the Wyden-Smith tax bill hasn’t gotten much of a look, either.
That doesn’t mean we won’t see a few more fireworks before the FAA bill is passed, of course. There are a lot of senators who want to hitch their policy priorities to this package. But we’re skeptical it will be used as a vehicle for much significant policy.
That realization has led lawmakers to look down the calendar. Banking lobbyists, for one, have a lot of hope that there will be an opportunity to move financial services legislation in the annual defense authorization package.
Even then, though, lawmakers we spoke to late last week aren’t so optimistic.
Smaller than it used to be: The NDAA has been used to move pieces of financial services law in the past, including the Corporate Transparency Act in 2021. But it’s still no slam dunk.
Sen. Thom Tillis (R-N.C.) told us that the NDAA’s viability as a financial services vehicle “could be eroding.”
“Our history on passing NDAAs has been pretty bad over the past few years. So the last thing we want to do is create a more contentious environment and fail to get it done this year.”
Sen. Jack Reed (D-R.I.), who chairs the Senate Armed Services Committee, said the NDAA was “one of the reasons we’ve passed some very good legislation that couldn’t otherwise get on the floor.”
But Reed also warned that it would continue to be tough for lawmakers to include legislation that couldn’t show clear support. “We seldom are going to put something on the bill so controversial that it would stop the bill. We can’t do that,” Reed said.
A lot of the major financial services packages we’ve been tracking over the past two years are at least a little controversial — particularly anything crypto-related — or have uncertain whip counts, as is the case for the Credit Card Competition Act.
But the year-end NDAA offers one big benefit to top financial services lawmakers anxious to make a deal before 2025: time.
House Financial Services Committee Chair Patrick McHenry (R-N.C.) and top Democrat Maxine Waters (D-Calif.) haven’t been able to land a deal to regulate stablecoins. But once they do, they’ll likely need to negotiate with Senate Banking Committee Chair Sherrod Brown (D-Ohio).
Brown’s got his own priorities, including executive accountability legislation and cannabis banking reforms. If there’s a grand compromise to be made here, we expect it to swirl around those policies — and maybe then, a finserv package has a chance in the NDAA.
The tax battle that wasn’t: There’s been plenty of fuss over what’s probably the last must-pass legislative vehicle before the elections. So it stuck out that one big-ticket item hasn’t made much of a splash.
The Republican resistance — led by Senate Finance Committee Ranking Member Mike Crapo(R-Idaho) and backed by GOP leadership — has been enough to block the Wyden-Smith tax bill from riding on FAA. Attaching the legislation would sink the FAA package given Republican objections, according to a Senate GOP aide, and there doesn’t seem to be any appetite for taking that risk.
Senate Finance Committee Chair Ron Wyden (D-Ore.) said he’s working “to push open every possible door” for the bill.
Wyden plans to file the House-passed version of the tax bill as an FAA amendment, a Wyden aide confirmed. Semafor first reported the effort.
But that will draw GOP objections, and it’s unlikely Wyden would hold up any time agreement on FAA to get the amendment vote. So this appears to be more of a Hail Mary from Wyden, who’s still working to keep his bill on the radar.
We knew the Smith-Wyden tax bill was likely dead, especially after tax season came and went.But the tax bill going nowhere in FAA — and without too much of a fight — is the latest sign that the bill has no path forward. Attention is already turning to 2025.
It hasn’t helped the bill’s chances that along with staunch GOP opposition, it has critics on the left. Sen. Elizabeth Warren (D-Mass.) has had some scathing words for the Smith-Wyden deal.
“That bill is a reminder that corporations do a lot better job lobbying Congress than poor children do,” Warren said this week.
– Brendan Pedersen and Laura Weiss