Cannabis legislation in the USA

In the Northeastern United States

New York State

In 2014, New York State legalized medical cannabis. Subsequently, several attempts to legalize its recreational use by adults have failed. Why? The reasons for this impasse are numerous. Here, we mention only one. Indeed, the state's leaders have struggled to agree on how to distribute tax revenues related to the legal distribution of cannabis.

Nevertheless, two major reasons will force them to revisit the issue of legalizing recreational cannabis. What are they? On the one hand, New York State is facing a budget deficit ($15 billion) following the COVID-19 pandemic. On the other hand, neighboring New Jersey is making significant strides in that direction. Therefore, it could capture all the revenue related to recreational cannabis sales. "If New York doesn't legalize, it's losing a huge opportunity," says Rob DiPisa, co-chair of the cannabis law group at Cole Schotz. "New Jersey will get this influx of customers from New York, and it's just that New York is losing tax revenue they can't afford to lose," he adds. The adult-use market in New Jersey is projected to reach nearly $1 billion in annual sales by 2024.  Marijuana Business Daily projects that a New York City adult-use market could eventually become the largest on the East Coast, generating $2.3 billion in annual sales as early as its fourth year.

The benefits of this legalization would extend beyond simply addressing the budget deficit. On the one hand, jobs would be created, as new businesses in this sector would emerge. On the other hand, it would allow for the development of projects for communities affected by the war on drugs. In this regard, Cuomo, in a press release, envisioned a structure offering "licensing opportunities and assistance to entrepreneurs from communities of color that have been disproportionately affected by the war on drugs.".

The residents of this state are simply crossing their fingers that this movement doesn't change course. On this point, there's very little room for doubt that it won't work. Several influential figures have already spoken out on the matter.

State of Vermont

Thestate of Vermont stands out from others thanks to its cannabis legalization process. While other states (primarily) use referendums to legalize this substance, Vermont opted for a legislative process. Phil Scott, Governor of Vermont in 2018, signed the bill legalizing cannabis use. The law came into effect on July 1st of the same year. The Governor commented on the matter as follows:

“I personally believe that what adults do in their homes is their choice, as long as it does not negatively affect the health and safety of others, especially children.”

The establishment of cannabis dispensaries followed this decision. In this context, home cultivation is permitted, but under certain conditions. First, the individual cultivating the cannabis must be an adult (over 21 years old). Second, the number of plants is limited to two flowering plants and four vegetative plants per household. Regarding possession and consumption, the maximum quantity is 28 grams. Exceeding these limits is punishable by a $200 fine. Furthermore, the law permits the possession of accessories used for cannabis consumption. These include, for example, bongs, pipes, and vaporizers.

In the Western United States

State of Colorado

On November 6, 2012, the state of Colorado legalized the use of small amounts of cannabisby referendum. The referendum passed with 53.25% of the vote and took effect on January 1, 2014. From then on, cannabis for recreational and medicinal use was permitted. Individuals over the age of 21 could possess up to 56 grams of the substance. However, consumption in public places was prohibited. Furthermore, cultivation was limited to six plants (three of which could be flowering plants).

State of Nevada

Thestate of Nevada, in a referendum held on November 8, 2016, approved the legalization of recreational cannabis by a 54% majority. Later, the legalization of medicinal cannabis followed. However, each legalization comes with specific restrictions. Firstly, it is illegal to consume cannabis in the street (or any other public place). Secondly, the sale of cannabis to minors is strictly prohibited.

State of California

On November 8, 2016, theState of California, in a referendum passed with 56% approval, legalized recreational cannabis. Medical cannabis has been legal since 1996. Following this referendum, a law passed in 2018 authorizing the production, consumption, and sale of cannabis, making California one of the world's largest cannabis markets.

In the Midwest of the United States

State of Michigan

The state of Michigan lagged behindother states in legalizing cannabis, having legalized it in 2018. Sales officially began in 2019. However, the primary distribution points for cannabis were dispensaries. It's worth noting that while legalization occurred in 2018, dispensaries had already been authorized to use cannabis for therapeutic purposes since 2008. Under this authorization, patients could cultivate 12 plants and possess up to 70 grams.

State of Illinois

Illinois legalized medical cannabis in 2013.Later, in 2019, recreational cannabis became legal. Governor JB Pritzker promised cannabis legalization during his campaign, and once in office, it became a reality. The state legislature approved the bill legalizing the substance. This law includes two main taxes: a 10% tax on products containing 35% THCand a 25% tax on those with a THC content of 20% or higher. This law expands upon the medical cannabis laws introduced in 2013. Now, each patient can cultivate up to five cannabis plants. However, the prohibition on cultivation for healthy individuals remains, though it is decriminalized. Violators will be required to pay a fine ranging from $100 to $200.

State of Ohio

The state of Ohio legalized medical cannabis in 2016.Various attempts to legalize recreational cannabis have been unsuccessful. The most recent attempt was rejected by the Ohio Attorney General's office. He justified his decision as follows:

“Because your submission did not contain verified signatures from at least 1,000 qualified voters, we must reject it.”

At the far northwestern tip of America

State of Alaska

The state of Alaska is moving from decriminalization to legalization of cannabis. This substance has been decriminalized in Alaska since 1982, and legalization took place in 2014. Now, adults (people over 21 years of age) can possess and/or consume up to 28 grams of cannabis. Cultivation is permitted under certain conditions: a maximum of six plants, three of which must be flowering. Unlike other states that prohibit consumption in all types of public places, Alaska allows it only at the point of purchase. Regarding sales for recreational use, it is important to note that these officially began in November 2016, in contrast to sales for medical use, which have been in effect since 2007.

In the Southeast and Southwest of the United States

State of Florida

thestate of Florida approved the legalization of cannabis for medical use. Recreational use, however, remains prohibited. Possession of 20 grams is considered a misdemeanor. Offenders face various penalties, including imprisonment of up to one year, a fine of up to $1,000, and a driver's license suspension.

State of New Mexico

New Mexico is also embarking on a process of legalizing cannabis. In 2020, a bill to legalize adult-use cannabis was passed by a Senate committee. Later, it was rejected by a second committee. Nevertheless, the governor included cannabis legalization in her 2021 legislative agenda. In an interview, she stated that she was "still very optimistic about cannabis." Two bills have been introduced to this end.

One, by Cliff Pirtle, Republican senator. He highlights the following points.

1. The creation of a private commercial industry: it would allow adults aged 21 and over to buy and possess up to two ounces (56 grams) of cannabis.
2. An unauthorized home cultivation.
3. The definition of places for cannabis consumption.
4. A 2% excise tax to be imposed on retail sales, in addition to local taxes.

The other, by Democratic Senator Daniel Ivey-Soto, highlights the following points.

1. Authorization for adults aged 21 and over to purchase and possess up to two ounces of cannabis.
2. Growing cannabis for personal use is prohibited. However, cultivating up to three mature plants would constitute a civil offense punishable by a $500 fine.
3. A 21% tax on cannabis sales.

In 2021, New Mexico 's Democratic governor , Michelle Lujan Grisham, signed both bills into law. As a result, cannabis for adult use is now legal. This means that individuals aged 21 and over are allowed to possess up to two ounces (56g) of cannabis and 16g of extract. They can also cultivate up to six cannabis plants at home. Furthermore, cannabis-related criminal records are automatically expunged.

Furthermore, regarding specialized shops, it should be noted that their opening is planned for 2022. These shops will initially be taxed at 12%. However, this rate will eventually increase to 18%, and cannabis businesses will be subject to taxes ranging from 5% to 9%.

State of Virginia

Virginiais the 16th state in the US to legalize cannabis. Legislators in this part of the country have approved the bill that aims to legalize the plant within their jurisdiction. This bill is the culmination of two separate bills submitted by both houses of Congress. The final version was adopted by a vote of 48 to 43 in the House of Representatives and 20 to 19 in the Senate. It is important to note that no Republicans voted for this bill in either chamber.

That being said, it is now up to Virginia Governor Ralph Northam to approve it for its implementation. It should be noted that Northam supports the legalization initiative. In fact, some time before, Ralph stated that "It's time to legalize marijuana in Virginia." Following this line of thought, well before the emergence of this bill, he first signed another law decriminalizing cannabis. This law set a $25 fine for simple possession, thereby sealing conviction records and prohibiting employers from inquiring about prior convictions.

From this perspective, what does this legislation on the legalization of cannabis in the state of Virginia ? It can be summarized by the following main points:

1. Sales of cannabis for adults will not begin until 2024, under the compromise law.
2. The imposition of a 21% excise tax on sales. To which municipalities add an additional 3% tax on retailers on top of the sales tax.
3. Tax revenues are used to fund education, substance use disorder treatment programs, other public health initiatives, and a cannabis equity reinvestment fund. This fund would provide resources such as scholarships and workforce development for communities affected by drug control.
4. Adults over the age of 21 may possess up to 1 ounce (28g) of cannabis; with up to four plants per household allowed for home cultivation.

This project, for some, although it could be improved, constitutes a true foundation for justice in the state of Virginia. In this vein, Del. Charniele Herring, sponsor of the legalization bill and leader of the Democratic majority, stated.

For me, this is a bill about justice

Although it has flaws and is not the perfect bill… I think it takes us in the right direction.

The MORE law and its implications

The vote on the MORE Act is initially scheduled for September 2020. Indeed, the adoption of this law would radically change the perception of cannabis in the US. In fact, for some, its adoption would represent a return to racial justice and a significant political shift.

That being said, what are the implications of this law? We present them below.

1. Removal of the federal ban on cannabis,
2. The removal of criminal records for people already convicted of cannabis,
3. Imposing a 5% federal sales tax,
4. Possible review for individuals incarcerated for cannabis-related offenses
5. Protection of immigrants from the denial of citizenship for cannabis-related offenses
6. End of money laundering from cannabis.

Given these enormous stakes, it goes without saying that cannabis will be central to the US presidential election. While we wait for that moment, we recommend this video.

A last-minute date change

Although initially scheduled for September 2020, it is now expected to take place in December. At the time of writing, the exact date has not been specified. However, POLITICO reports that it could be held from December 1st to 4th or from December 7th to 10th.

From this perspective, this postponement is an opportunity chosen by certain figures to reiterate the importance and implications of the vote. Furthermore, the co-chair of the Cannabis Caucus, Barbara Lee, maintains that:

The votes of November 2020

Indeed, five states are holding votes on the legalization of medical and/or recreational cannabis within their territories in November 2020. These states are listed below:

1. Arizona
2. New Jersey
3. South Dakota
4. Montana
5. Mississippi

Arizona

After previous rejections of cannabis legalization in the state, Arizona could finally take the plunge with the November 2020 vote. This is especially true given the support of major organizations, including leading figures in the US cannabis industry. Among them are Tempe, Harvest Health & Recreation (HRVSF), based in Arizona, and companies such as Curaleaf (CURLF) and Cresco Labs (CRLBF), which have cultivation and retail operations in the medical cannabis industry in Arizona.

So, what are the implications of legalizing medical and/or recreational cannabis in Arizona? On the one hand, Proposition 207 will allow adults 21 and older to possess, consume, or transfer up to one ounce of cannabis and will create a regulatory system for the cultivation and sale of cannabis products. On the other hand, recreational sales in Arizona could reach $700 to $760 million by 2024.

New Jersey

In 2017, Governor Phil Murphy promised to legalize cannabis in New Jersey during his election campaign. This promise could become a reality with the November 2020 vote. He argued that legalizing cannabis would generate $300 million in revenue for the state. He also maintained that it would help establish social justice in the state.

If the vote is in favor of legalization, adults aged 21 and over would be able to legally possess and consume cannabis. Furthermore, recreational cannabis products would be subject to state sales tax (currently 6.625%). Annual sales are projected to reach between $850 million and $950 million by 2024.

In short, it will take a few more months for the cannabis industry to truly take off and for the related legislation to be fully implemented in this state. As Charlana McKeithen, founder and director of Garden State NORML, stated

South Dakota

South Dakota wants to kill two birds with one stone. Why? Because most states often legalize cannabis in stages. In other words, first medical cannabis, then recreational. Or the other way around. Except that, in this case, it's possible that both will be legalized at once.

Indeed, the vote is on measure 26 of the bill. This measure could, on the one hand, establish a medical cannabis program and a registration system for eligible individuals. Similarly, Amendment A could legalize cannabis for adults. This, in turn, would require the legislature to adopt legislation for both medical cannabis and hemp.

On the other hand, Amendment A could generate $29.3 million in tax revenue by the state's fiscal year 2024.

Montana

To easily present the proposal to legalize cannabis in Montana, let's look at the two main ballots that will be submitted to voters. First, I-190. This ballot would either allow or prohibit adults in the state from possessing, purchasing, and using cannabis for recreational purposes. Second, I-118. This ballot would establish 21 as the legal age to purchase, possess, and consume cannabis.

If passed, Initiative I-190 would establish a 20% tax on recreational cannabis, with more than half of the tax revenue going into the state's general fund and the remainder allocated to programs such as law enforcement, addiction treatment, and veterans' services. This measure would also allow individuals serving sentences for certain cannabis-related offenses to request a new conviction or have their records expunged.

Furthermore, it is projected that sales of recreational cannabis will total nearly $193 million in 2025, generating $38.5 million in tax revenue.

Mississippi

The legalization of cannabis in the state of Mississippi rests on two main initiatives.

Our source, CNN, presents the first one as follows:

Initiative 65, which originated from a citizens' petition, would allow doctors to recommend medical cannabis to patients with one of 22 eligible conditions, such as cancer, multiple sclerosis, and post-traumatic stress disorder. The constitutional amendment would establish a regulatory program allowing companies to cultivate and sell medical cannabis and tax the products at a rate of 7%.

Regarding the second one, Initiative 65A, the same source explains:

Under Mississippi law, the legislature has the power to amend or draft an alternative measure, and that is what it did here through Initiative 65A. The competing measure requires pharmaceutical-grade medical products, restricts the smoking of medical cannabis to terminally ill individuals, and leaves the future creation of rules and a regulatory framework to the legislature.