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Delaware House committees approve companion bills on marijuana legalization and regulation

A pair of companion bills to legalize marijuana and establish regulations for the cannabis trade in Delaware were approved by separate House committees on Wednesday.

Rep. Ed Osienski (D), sponsor of both measures, previously attempted to pass a comprehensive bill that would have achieved both goals at once, but failed to receive the required three-fifths supermajority vote last month.

Rather than throw in the towel, the legislature devised a two-track approach to reform by introducing a basic legalization bill that would allow adults 21 and older to own and share up to an ounce of cannabis and another that establishes a specific regulatory framework for an adult use market.

The old bill would only require a simple majority to pass, and so if this measure is signed into law, the idea is that it would put “additional pressure” on lawmakers to push through complementary legislation with a supermajority. , rather than having legalization with no regulations in place. , Osienski said earlier this month.

So far, things are going as planned.

The simple legalization bill, HB 371, passed the House Health and Human Development Committee. A few hours later, the regulations measure, HB 372has been approved by the House Revenue & Finance Committee.

In this latest hearing, Osienski detailed the provisions of HB 372, saying the legislation “creates the legal framework to license and regulate a new industry that will create well-paying jobs for Delawares while dealing a blow to the criminal element.” , which is currently profiting from our state’s thriving illicit market.

At the previous hearing, the sponsor briefly described the simple legalization bill, acknowledging that his previous measure “unfortunately failed” on the floor of the House.

Notably, House Speaker Pete Schwartzkopf (D), who was the only House Democrat to vote against the previous legalization bill, signaled he might be inclined to back a bill that provides a regulatory infrastructure for the marijuana trade if the chamber votes to legalize possession. and share. That said, he still intends to vote against HB 371.

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Vermont lawmakers followed a similar approach to what Osienski is currently pursuing by first passing a non-commercial legalization bill in 2018 and then following it up with separate legislation to tax and regulate sales in 2020.

“We are thrilled that legalization has new life in Delaware and that the new bills are already underway,” Karen O’Keefe, director of state policy for the Marijuana Policy Project, told Marijuana Moment. . “Over 60% of Delaware voters support ending the War on Cannabis, and it is imperative that the Legislature find a way to make their will a reality. Too many lives have been changed by prohibition.

Here’s what Delaware’s HB 371 would do:

The bill would change state law by eliminating penalties associated with possession of up to one ounce of marijuana by adults 21 and older.

It would further add a section stating that adults 21 and older could share up to one ounce of cannabis “without compensation”.

This section clarifies that marijuana cannot be “gifted” as part of a contemporaneous “reciprocal transition” or if the gift is subject to a separate transaction for goods or services other than cannabis.

Here are the main provisions of the HB 372 supplement:

A marijuana commissioner would be appointed within the state’s Alcohol and Tobacco Law Enforcement Division. The official would be responsible for regulating the industry and overseeing the licensing of retailers, growers, manufacturers and laboratories.

Licenses would be awarded through a competitive, graded process, with benefits granted to those who pay workers a living wage, provide health insurance or meet certain other criteria.

After 19 months of the bill’s enactment, regulators are expected to approve 30 retailer licenses, half of which would go to social equity applicants. Social Equity Candidates would be defined as entities that are majority-owned by people with previous cannabis convictions or who live in an area disproportionately affected by the war on drugs.

These applicants would also be awarded one-third of the planned 60 cultivation licenses, one-third of the manufacturing licenses and two of the five testing laboratory licenses. They would also be entitled to reduced application and licensing fees as well as technical assistance from the state.

Marijuana retail sales would be subject to a 15% tax. No tax would be levied on sales of medical cannabis.

Seven percent of tax revenue would be used to support a new Justice Reinvestment Fund that would provide grants, services and other initiatives focused on issues such as diversion, workforce development and education. technical assistance for people in economically disadvantaged and disproportionately affected communities. by the war on drugs. The money would also be used to facilitate write-offs.

Home cultivation for personal use would continue to be prohibited.

The legislation would allow individual municipalities to set their own regulations for the hours and locations of marijuana business operations, and they would also be allowed to completely ban cannabis businesses from their jurisdictions.

The bill provides explicit legal protections for state employees who work with the state’s legal market. And it would also allow marijuana businesses to claim tax deductions at the state level, which they are prohibited from doing at the federal level under a tax code known as 280E.

The tax and regulation bill is much the same as the measure defeated in the State House last month.

At Wednesday’s second hearing, officials from several state departments raised concerns about the regulatory bill’s provisions, including those on outdoor marijuana cultivation, saying such operations could be the target of robberies.

Even older legalization invoice d’Osienski authorized the committee last year. However, disagreements over social equity provisions stalled this version, preventing it from speaking. At the time, Osienski pledged to introduce a revised bill for the 2022 session that could garner broad enough support to pass.

When the sponsor’s previous bill was reviewed last year, he said he was taken aback when told that the inclusion of a social equity fund meant the bill would require 75 % of House Legislators to Approve it.

The legislature attempted to address the issue through an amendment, but some members of the Black Caucus opposed the changes and the measure failed.

Osienski worked with the Black Caucus in the months that followed to gain support and move towards more palatable legislation. And a clear sign of progress is that Reps. Rae Moore (D) and Nnamdi Chukwuocha (D) signed on as co-sponsors of the since-rejected bill after withdrawing support for the 2021 version on fairness grounds. They are also listed as co-sponsors of the new HB 372.

In 2019, Osienski was the lead sponsor of a legalization bill that authorized a House committee but failed to make progress across the House. This bill would have allowed medical cannabis dispensaries to begin selling marijuana to adults 21 and older while the rest of the adult-use industry was still gearing up to launch, a provision that was removed from later versions.

Four of the state’s six medical marijuana companies have spoken out publicly against the change and testified against the bill last year. In response, activists in Delaware mounted a boycott against these operators.

Portions of the most recent version of the Cannabis Radiation Regulation Bills were deleted this session, as they were made redundant by the enactment of separate legislation last year.

While supportive lawmakers have worked to push cannabis reform through the legislature, they have also risen to the challenge of winning over Gov. John Carney (D), one of the few Democratic governors who remain opposed to legalization.

Despite his distrust of legalizing adult use, Carney has already signed two marijuana delisting laws. In 2017 and 2018, a state task force met to discuss legalization issues, and the governor hosted a series of cannabis roundtables.

A legalization bill had already received majority support in the House in 2018, but it failed to secure the supermajority needed to pass.

Carney’s predecessor approved a measure to decriminalize simple possession of cannabis in 2015.

An analysis by state auditor Kathy McGuiness (D) released last year found that Delaware could generate more than $43 million in revenue annually by regulating marijuana and imposing a 20% excise tax. . The legal market could also create more than 1,000 new jobs over five years if the policy is adopted, according to the report.

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