Maine Lawmakers Reject Interstate Marijuana Commerce Bill In Committee

A Maine legislative committee has rejected a bill that would have authorized the governor to enter into agreements with other legal marijuana states to allow interstate cannabis commerce once federal policy changes.

The legislature’s Joint Standing Committee on Veterans and Legal Affairs took up the legislation from Rep. Joseph Perry (D), but members voted unanimously on a motion not to pass it.

That said, the chairman emphasized that cross-border trade and other cannabis issues that the panel stalled at the hearing could still advance as part of a separate vehicle as lawmakers continue to work throughout the summer, saying that “the subject is not off of the radar.”

As introduced last month, the measure would have simply permitted the governor to forge agreements with other states to allow marijuana imports and exports between consenting jurisdictions. The sponsor sought to amend the bill to give the governor a mandate to enter those agreements, but the committee didn’t act on the proposed revision.

The text of the legislation says that the governor “may enter into one or more agreements with another state or states authorizing commercial cannabis activity in this State by an out-of-state commercial cannabis business or authorizing a Maine commercial cannabis business to engage in commercial cannabis activity in the contracting state, as long as the provisions of this subchapter are met.” The sponsor’s amendment would have changed the language to say the governor “shall” make such deals.

Additionally, the proposed amendment would have removed language that laid out specific requirements that states outside of Maine would have needed to meet in order to conduct marijuana interstate commerce.

The bill says that non-Maine businesses must “apply standards to out-of-state commercial cannabis businesses operating in the contracting state that meet or exceed the standards” included in Maine statute.

“Cannabis is now Maine’s most valuable crop, besting the state’s signature agricultural products such as potatoes, milk, and blueberries,” Perry said in testimony prepared for the committee during a public hearing last week. “When you combine the adult use and medical markets, some estimates have the value of the industry at over $500 million, significantly more than last year’s lobster harvest.”

“Federal legalization is on the way,” he said, noting that congressional lawmakers are actively working to advance a bipartisan marijuana banking bill that’s scheduled to receive a U.S. Senate committee hearing on Thursday.

Under the Maine legislation, interstate commerce activity could only have proceeded under one of four circumstances: if federal law changed, if congressional lawmakers restricted agency funding so that the feds wouldn’t be able to enforce the ban on interstate commerce, if the federal Justice Department issued a memorandum tolerating the commerce or if the U.S. attorney general issued a written opinion affirming that marijuana imports and exports wouldn’t put the state at increased risk of enforcement action.

Those requirements are similar to the laws that have been enacted in California, Oregon and Washington State—though California’s policy also gives the governor authorization to enter interstate commerce agreements if the state attorney general determines that the state would not be put at greater risk of being penalized.

After Washington State Gov. Jay Inslee (D) signed the interstate marijuana commerce bill last week, that meant that all states along the western coast of the U.S. are set up to buy and sell marijuana across their borders if the federal policy changes.

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On the East Coast, New Jersey’s Senate president filed a similar interstate proposal last year, but it has not yet been enacted.

Maine is a uniquely isolated state, only bordering New Hampshire. The bill said that marijuana couldn’t be transported through states that didn’t permit it, so that could have created additional regulatory complications given that New Hampshire has not yet legalized recreational cannabis.

A federal appellate court ruled last year that Maine’s law prohibiting non-residents from owning medical marijuana businesses in the state violated the Commerce Clause of the U.S. Constitution. Some legal experts believe the same rationale invalidating the residency restrictions could come into play in challenges against state-level bans on marijuana imports and exports.

Disallowing imports and exports of medical cannabis between consenting states could be construed as similarly protectionist and unconstitutional, the thinking goes.

In November, an Oregon marijuana business filed a lawsuit in federal court, declaring that the state’s current ban on cannabis exports and imports to and from other states violates the Constitution.

“There are numerous legal theories of how interstate commerce could happen today without congressional action,” Perry said in his testimony, adding that “the Courts might act on their own to allow for interstate commerce.”

“Regardless of when and how it happens, legalization of interstate commerce of cannabis is on its way,” he said. “When that day happens, it is important for Maine to be ready. Much like our reputation for excellence in Maine s craft beer industry, Maine has developed a unique culture of small growers and manufacturers that I am told is highly sought after throughout the country.”

Meanwhile in Maine, state cannabis regulators released a report last year finding that the launch of an adult-use cannabis market in the state has already exceeded expectations when it comes to driving down illicit sales.

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Photo courtesy of Philip Steffan.