On July 7, 2017, the Oregon Legislature adjourned sine die for the 2017 Legislative Session, a session many lawmakers regard as one of the more difficult sessions in recent history. Balancing the state’s $21 billion dollar budget and passing a multi-modal transportation package cast an overwhelming shadow over the legislature and state-wide news coverage this session, but the Joint Committee on Marijuana Regulation (yes, it’s really called that) managed to push through 9 bills that will become law. The 2017 Legislative Session marked the last session with a legislative committee formed specifically to address marijuana policy. Moving forward, policy makers are expecting less new legislation regarding marijuana and any new bills will be sorted into other, more permanent committees for public hearings and work sessions. Without the constant stream of new laws from Salem, the industry can hopefully look forward to more stability from regulators. Constant changes to the state laws that regulate marijuana have made it difficult for business owners to keep up in all areas of the budding industry. Moreover, in their last session as a committee, the Joint Committee passed some sensible bi-partisan policy that will hopefully add stability to the state’s regulatory structure, improve equity in the industry, decrease diversions into the black market, and protect medical marijuana producers and patients. Below is a round-up of every bill that passed out of the legislature and some of the interesting ones that did not pass.
SB 319 – This bill was the first to pass out of the Joint Committee this session. It is a simple bill that adds flexibility to the state’s buffer zone requirements. It provides cities and counties with authority to allow dispensaries (both medical and adult-use) to be located as close as 500 feet from a school (previous laws required a 1000 foot limit) when a physical (e.g. I-5) or geographic (e.g. the Willamette) barrier exists that is capable of preventing children from traversing to the dispensary from the school.
SB 863 – This bill was passed in an effort to protect consumers from potential federal enforcement by expressly prohibiting dispensaries from recording, retaining, or transferring any information that could be used to identify a consumer. This bill had bi-partisan support and passed with an overwhelming majority in both chambers.
SB 302/SB 303 – This duo of bills became law on the same day, early in the legislative session. They are both housekeeping bills. The former removes/reduces criminal penalties related to the state Controlled Substances Act from dozens of conforming statutes and the latter amends/clarifies state laws related to minors possessing and purchasing cannabis. While important in normalizing cannabis, they should not have much impact from an industry perspective.
SB 1057 – In keeping up compliance with the Cole Memo, and thus avoiding federal enforcement of the adult-use market, one of the most important issues is preventing diversions of marijuana into the black market. This is a primary concern of the Joint Committee because, even after two years of regulation, Oregon remains one of the primary sources of black market marijuana. In order to combat this, the Joint Committee introduced SB 1057, which among other things, gives OLCC broad discretion to prevent diversions; requires the medical marijuana program to use the same seed-to-sale tracking system used by OLCC licensees; moves all labeling authority to OLCC, providing uniformity across markets; and imposes new limits on immature plants for medical producers.
SB 56 – The immature plant limits imposed by SB1057, mentioned above, triggered the ire and fears of many producers shifting to the adult-use market. The Joint Committee, and the legislature as a whole, responded quickly, passing SB 56 only three weeks later. This bill grandfathered all pending OLCC applicants at the time of passing (June 26th) out of the new immature plant limitations, easing concerns of industry participants. Additionally, the bill further addresses the state concerns of black market diversions by allowing OLCC to suspend licenses immediately if probable cause of illegal activity exists.
SB 1015 – This bill gives industrial hemp producers greater market access by allowing them to transfer hemp and hemp concentrates to OLCC licensed producers. Pretty simple.
HB 2197 – This bill addresses concern that the state regulated adult-use and medical markets do not encourage market access to Oregon Indian Tribes. The bill increases equity on this front by allowing the Oregon Department of Revenue to enter into agreements with federally recognized tribes to provide rebates for the estimated tax on marijuana products sold by tribes.
HB 2198 – This bill is not a law yet; it is still awaiting the Governor’s signature. Both House and Senate passed the bill at the tail end of the legislative session and the Governor is expected to sign. The Joint Committee worked hard this session to pass a bill that would protect the Medical Marijuana Program. Where most bills go through a public hearing, a work session and maybe a handful of amendments, this one had five public hearings, 3 work sessions, and 40 amendments (one legislative office remarked that this was the most amendments to one bill that they had ever seen). The bill creates the Oregon Cannabis Commission to advise the Legislature and the Oregon Health Authority in their continued oversight of the Oregon Medical Marijuana Program. This bill also contains provisions that will drive research in public health, agricultural best practices, and medical use. Additionally, the bill allows medical producers to transfer 20 pounds of usable marijuana to license holders in the adult-use market. This is another attempt by the state to limit diversions from medical producers into the black market, this time with a carrot rather than criminal enforcement. In the end, the goal of this bill is to protect patient access and keep the medical program viable as the state continues to invest more regulatory power into OLCC and market share to adult-use.
What we wished had passed
SB 307 – This bill would have allowed OLCC to regulate the consumption and sale of adult-use marijuana at cannabis lounges and temporary events. This bill could have brought Oregon one step closer to the cafes of Amsterdam and provided a major boon to the marijuana tourism industry. Many interested parties in the industry were waiting eagerly for the outcome of this bill, unfortunately, even after three public hearings; it never made it out of committee. Social use bills remain a contentious topic around the country, with limited progress in states with adult-use markets for those hoping to enjoy cannabis legally in a more public setting. We will be keeping an eye on Denver, where regulators are currently working to roll out a pilot program for social consumption; become the first city in America to allow cannabis use in select restaurants and bars.
What we’re glad didn’t pass
HB 3229 – This bill would have completely eliminated the medical marijuana program had it become law. It completely divested power from the Oregon Health Authority to regulate medical producers, processors, and dispensaries and would have transferred that power to OLCC to regulate as adult-use. This would have been the final blow to medical marijuana in a policy regime that has slowly been whittling away at the medical program since Measure 91 passed.