The Legal Cannabis Industry

2014 has been a monumental year for supporters of marijuana legalization. 2015 will be the year everyone remembers as we steam roll into a new era.

Alaska, Oregon and Washington, D.C. recently went to the polls to approve recreational marijuana use, in hopes of joining Colorado and Washington as new bastions of legal marijuana consumption. Progress like this as well as medicinal use and decriminalization are the building blocks to a federal legalization to come.

The movement to legalize marijuana didn’t start last year. Supporters have been working for years to pass and implement policies in the United States that regulate the distribution, medical use and consumption of marijuana and its products.

As legalized marijuana continues to build momentum in states across the country and inevitably become legal on a federal level.

Marijuana is legal in some form in close to half the states in the U.S.

  • Four states and Washington, D.C., allow recreational marijuana. Nineteen states allow it for medical purposes, and 14 have decriminalized it.
  • In the states with outright legalization, possession and consumption of marijuana is legal for people age 21 and older. Alaska, Oregon, Washington and Colorado have already instated or are in the process of introducing a model whereby marijuana can be legally sold, taxed and regulated. Washington, D.C., has only legalized possession and growing for the time being, but its city council will likely move to tax and regulate soon.
  • In the additional 19 states where marijuana for medicinal purposes is legal, regulation varies widely, with certain states, such as California, so lax about criteria for a medical marijuana card that it ultimately assumes a quasi-legal status.
  • States where marijuana has been decriminalized have softened the penalties associated with possessing the drug, often limiting or eliminating prison time and opting for fines instead. Like with medical marijuana, states vary a great deal in their laws, and decriminalization does not do away with harsh penalties for possessing or trafficking large amounts of the plant.

A majority of the country supports legalization!

  • Support for legalization over the past 25 years has steadily increased. Just 16% of those surveyed by CNN/ORC in 1990 supported legalizing marijuana. Recent polling puts support at over 50%, a clear sign that as legalization takes hold in more states, support for greater access to the drug increases.

Legalization could lead to billions of dollars in tax revenue!

  • When states legalize pot, they can levy substantial taxes on the marijuana industry and generate muchneeded revenue for their budgets. Colorado’s recent introduction of marijuana is already bringing in more than $30 million of taxable revenue a month — leading to upwards of $7.5 million of tax revenue. The Drug Policy Alliance estimates that California could raise $1.4 billion annually in extra revenue if it taxed and regulated the sale of marijuana.
  • If marijuana is legalized federally, the marijuana industry could be more than three times bigger than the NFL — and it could all be taxed.

States with legalization are doing very well!

  • Colorado introduced marijuana last year and has not descended into chaos or seen a catastrophic loss of productivity. Instead, it’s pulling in millions of dollars in tax revenue. In September, recreational sales exceeded medical sales in the state, suggesting that state-regulated marijuana may be a viable alternative to the black market.
  • Washington doesn’t have comparable figures, having rolled out legal marijuana more recently than Colorado and almost immediately encountering a shortage of the plant for retail. But so far, there are no reports suggesting that legalization has had adverse consequences for the state.

Regulating marijuana makes society safer!

  • The correlation between regulation and public safety is a common sense principle borne out by history in countless industries. Just as consumers are protected by requiring restaurants to be inspected for health violations or pharmaceutical companies to submit new products to the FDA, regulating marijuana will make it more likely that consumers are getting a quality product undiluted by potentially harmful additives.
  • Foul play by a specific pot retailer will be more easily flagged. If legal marijuana successfully displaces the black market, it will make access for minors far more difficult. In the long run, public discourse will finally allow us to have a conversation about responsible use.

The feds are turning a blind eye to the states.

  • Marijuana is not legal under federal law, but no federal entity has intervened in state legalization measures so far. In the immediate aftermath of the first legalization measures, President Obama said that he has “bigger fish to fry” than cracking down on the marijuana industry. The following year, his administration released a memo stating that the Department of Justice wouldn’t challenge state laws on marijuana legalization as long as they adhere to a set of strict rules regarding the sale and distribution of the drug, such as ensuring minors don’t have access to it.
  • Recently, Attorney General Eric Holder expressed optimism about Washington and Colorado’s paths. But the legalization of recreational marijuana in the nation’s capital on Tuesday brings the conflict between local and federal law into full view of federal lawmakers and could prompt congressional action.

Legalization helps us better understand marijuana’s health effects.

  • The federal government’s prohibition of marijuana has systematically hampered serious scientific inquiry into the health risks of marijuana for decades. We’re hamstrung by a Catch-22, pithily captured by the Wire: “Marijuana is illegal because the [Drug Enforcement Administration] says it has no proven medical value, but researchers have to get approval from the DEA to research marijuana’s medical value.”
  • There is substantial evidence on its ability to alleviate pain and nausea, but its benefits and risks are still under-explored relative to how long and how widely the drug has been used. Hopefully, as marijuana reform sweeps the country, we can start looking into the complex question of the carcinogenic properties of marijuana smoke and it’s potential to alter teenage brain development.
  • These are just a handful of the lessons we’ve learned from states’ experiments in decriminalizing and legalizing marijuana use, either for medicinal or recreational use. Marijuana is hardly the harmful societal force for evil it was once considered. As that new consensus grows, we’ll only know more about the drug’s actual effects on society.

The National Cannabis Industry Association (NCIA) is working to allow states to establish their own systems for regulating cannabis without federal interference. While we are likely a number of years away from the end of federal marijuana prohibition, now is the time to push the conversation forward. By promoting the benefits of the cannabis industry, both for consumers and the economy, NCIA is gradually undermining institutional support for prohibition. In order to begin the process of organizing, NCIA is supporting a number of current bills in Congress, including the “Ending Marijuana Prohibition Act of 2013” (H.R. 499), introduced by Rep. Jared Polis (DCO), which would regulate marijuana like alcohol under federal law.

The Obama administration took an important step forward in August 2013, when the Department of Justice issued a memo directing U.S. Attorneys not to direct resources toward prosecuting individuals and businesses acting in compliance with state medical marijuana laws. But some U.S. Attorneys are openly defying this policy by continuing to threaten state-legal cannabis businesses with criminal action and civil asset forfeiture. NCIA is ensuring that members of Congress and top administration officials appreciate the importance of the industry through direct lobbying and education efforts leading toward the day when state-legal businesses will be treated justly under federal law.

NCIA supports the Industrial Hemp Farming Act of 2013 (H.R. 525 in the U.S. House of Representatives and S. 359 in the Senate) and will encourage members of Congress to co-sponsor these two bills. It is long past time to end the nonsensical ban on hemp cultivation in this country.

NCIA supports the repeal of the federal Drug Paraphernalia statutes and U.S. Customs policies that harm businesses providing safe cannabis consumption accessories. Massive federal actions like 2003’s Operation Pipe Dreams must become a relic of the past.

NCIA is working to improve the American public’s perception of cannabis, cannabis consumers, and the industry that serves them. By seizing upon media opportunities in a timely fashion and elevating the voices of our members, we are changing the way the public views cannabis businesses. Educating the public on the value the legal cannabis industry brings to the U.S. economy and society as well as its relative safety and efficacy as a medicine and wellness product is the key in our efforts to reform federal law.

Unified leadership by the cannabis industry on the global stage is needed and the time to act is now. The International Coalition of Cannabis Companies & Organizations (ICCCO) aims to unite the wide range of cannabisrelated businesses and organizations into a singular voice on the international stage to craft, direct, and steward regulatory policy. Guided by the industry it supports and represents, ICCCO will build a model regulatory framework for cannabis in the three major areas of policy: medical marijuana, responsible adult recreational use, and industrial hemp. By building a policy consensus utilizing a bottom-up approach from a democratic ICCCO membership of cannabis industry stakeholders, policy experts, and the medical and scientific communities, standards and best practices will be codified and guideline recommendations made to regulators. In doing so, the nascent cannabis & hemp industry can continue to develop as a safe and legitimate business practice.

Because we are in a transitional period from illicit to licit trade, the collective global cannabis companies and organizations have a duty to be the standard-bearers of fair and ethical trade practices, environmental stewardship, and human rights. ICCCO maintains that adopting these values is not merely in accord with the best business practices for the cannabis industry, but imperative to its continued growth and acceptance. Unlike most industries, a willing and ready customer base for cannabis is already in place, and market growth is most likely assured. Therefore, the onus is on the cannabis industry to develop a socially acceptable method of doing legal business that can be transparent and trustworthy, without deceptive and unethical business practices such as those that have been historically undertaken by the tobacco industry. Along with the economic opportunities that come from ending prohibition, there is an opportunity to positively impact many issues such as social injustice, environmental stewardship, and public health, all of which would benefit from an industry-led approach.


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