New Hampshire Lawmakers Clash Over Competing Marijuana Legalization Proposals, With Revisions Planned In The Week Ahead

As a New Hampshire House subcommittee took up a marijuana legalization bill during a work group meeting Wednesday, the panel’s chair presented the measure’s sponsor with a choice: either work to amend the proposal into something likely to win the support of Gov. Chris Sununu (R), who favors a system of state-controlled stores, or try to pass the current bill through the House only to see it fail in the Senate.

Rep. John Hunt (R), who chairs the full House Commerce and Consumer Affairs Committee, said he had prepared an amendment to bring the bill more in line with what he believed Senate Republicans and the governor’s office would support—a legal market in which marijuana would be sold to adults through a state-controlled franchise system, similar to one discussed late last year by a state commission on legalization that ultimately failed to reach a consensus on recommendations.

But Rep. Erica Layon (R), the sponsor of the new bill, HB 1633, said she couldn’t put her name on legislation that made New Hampshire the exclusive franchisor for the cannabis industry—a novel move that she warned could open the state to costly legal liability.

“Quite frankly, if my name is on a bill where we’re talking about being a franchisor and the state is going to be sued, I’m going to have to speak against that,” Layon said of the chair’s amendment.

Another member accused Hunt of “hijacking” Layon’s bill with the amendment.

The meeting, at which lawmakers sometimes became visibly irritable, is the latest chapter in New Hampshire’s effort to find consensus on how to legalize marijuana. After more than an hour of discussion, lawmakers agreed to continue trying to work out the policy differences and return to Layon’s bill at another meeting next week.

As Wednesday’s work group meeting continued, it became clear that few others in the room were happy with Hunt’s proposed changes.

Civil rights advocates and representatives of the state’s existing medical marijuana industry pointed out that Hunt’s proposal omitted provisions that they believed had been widely agreed upon by the earlier legalization commission, such as annulments of certain past cannabis convictions and the ability for current medical operators to obtain dual-use licenses and offer sales to all adults.

Fellow lawmakers on the panel, meanwhile, complained they still hadn’t seen the amendment at time the meeting began—even though Hunt had circulated a draft to some stakeholders the day before.

“I was wondering, what document did you get?” one member of the panel asked a speaker who referred to the draft amendment. “I’m just curious why the committee didn’t get that.”

“It was what was sent to me from the commission,” Hunt began, “and I— sorry I didn’t send it out. I thought I’d sent it out to everybody.”

In response to Hunt’s warning that her bill in current form wouldn’t get past the Senate, Layon departed from the more conventional sales model she introduced in HB 1633 and offered an alternative.

“I know there’s a lot of interest in having a state-run model,” she said, “but there are multiple ways to have a state-run model. And I think that we can come to something that meets most people’s needs while making sure that we’re minimizing risks to the state.”

Specifically, she proposed doing away with the franchise model and instead borrowing a mechanism from New Hampshire’s state-run liquor system: agency stores. On the liquor side, agency stores are privately owned businesses permitted to sell liquor in areas not served by state-run retailers—a sort of exception to the government-only sales model. There are currently three such liquor stores across the state.

Layon said a similar approach could be employed around cannabis, arguing the change would more effectively protect New Hampshire and its tax revenue from lawsuits by distancing the state from day-to-day operation of cannabis retailers that touch the plant itself.

But Hunt said the proposal wouldn’t work, noting that agency stores get their liquor products from other parts of the state-run industry. He also said the plan was too much of a departure from the approach discussed last year by the state legalization commission.

“Let me just walk you through this so you understand how we got here,” he told Layon, explaining that the commission’s franchise model was in part intended to be a less costly version of the state-run liquor model, which the governor has repeatedly indicated he favors.

“How are we going to do that without having to pay millions and millions of dollars to build out?” Hunt said, noting the high cost of constructing state-run liquor stores. “That’s how the franchise model was invented.”

With the agency store approach, he continued, “you’re trying to take a model and say, ‘Oh, let’s make this work here,’ which is not what your bill is about at all.”

Hunt said he didn’t believe that the move away from franchises was necessary at all, at one point calling the idea a “red herring.” He claimed the agency store approach would allow marijuana sellers to engage in marketing and business practices outside what the franchise model would allow—even as Layon insisted the state could still use health and safety powers to limit marijuana marketing entirely if it so chose.

“If you think you want to change the idea of this bill to the individual entities being free to advertise on their own, free the market themselves, free to have their own name,” Hunt told Layon, “then that flies absolutely in the face of what the governor was looking for.”

Rep. Jane Beaulieu (D), the clerk of the committee, accused Hunt of “demeaning” Layon.

“She has a great background,” Beaulieu said of the bill’s sponsor, an economist and former medical device analyst.

“My job on Wall Street was to look at risks—for companies, for industries, for devices and surgeries—and see how companies could mitigate risks to be a good investment,” Layon told the panel. “So my job was to be paranoid, and they paid me really well for it—and also not to be overly paranoid, because I’d lose money and then people would punish me.”

Hunt said he was struggling to understand the new proposal’s aim. “What are you looking for other than calling it an agency store rather than a franchisee?” he asked, saying he was looking forward to seeing a revised version at the group’s next meeting. “I am certainly open to that suggestion. I just can’t visualize what is it that you’re thinking that you’re freeing up.”

Ultimately, after some sharp exchanges between committee members and speakers, the panel agreed to return to the bill next week.

Layon committed to creating a comparison of the competing proposals along with possible ways to combine the plans in a way that would be palatable. She said she believed it was possible to craft legislation that would address the governor’s and Senate Republicans’ concerns around state control and public safety while still shielding the state from legal risk.

The House has repeatedly passed marijuana legalization bills in recent sessions only to see them consistently fail in the Senate. Advocates are hopeful that something could finally be enacted this session, however, with the governor laying out a roadmap for what he would sign.

That said, stakeholders who spoke at Wednesday’s meeting emphasized the dysfunction of the state commission that met last year, seeming to question Hunt’s decision to defer to findings that members never agreed to. Many said they felt some members were outright opposed to legalization, while others said they were limited by what the governor would allow.

“I think there’s another big reason,” said Matt Simon, the director of public and government relations at New Hampshire medical marijuana provider GraniteLeaf Cannabis. “The study commission spent two months going through a draft of the franchise model, and we didn’t see a second draft of the very last meeting of the study commission. We were presented with a second draft that didn’t have half of the things the study commission had agreed on for the last two months. So that was very frustrating.”

(Disclosure: Simon supports Marijuana Moment’s work with a monthly Patreon pledge.)

Hunt, who himself was a member of the commission but missed several meetings due to illness and travel, said he didn’t realize there was such frustration around the body’s work. He also at times appeared unaware of what his own proposed amendment would do.

“I’m confused,” he said to Simon at one point about dual-use licenses for medical marijuana operators. “I was in Amsterdam one meeting and then, of course, I had COVID and missed the second meeting. But when I got back, you said everything was all solved.”

Simon replied that while commission members agreed to add a number of provisions to the draft bill, many agreed-upon changes were never included in a revised version.

Others pressed Hunt on why his amendment didn’t include annulments of past cannabis convictions, a provision that seemed to have broad support in the study commission but was also not included in a revised draft unveiled during the commission’s final meeting.

“Annulment’s supposed to be in this bill,” the lawmaker replied. “I don’t know, whatever happened, if you’re saying that it’s been removed?”

“I absolutely agree that annulment needs to be in this bill,” he continued. “That was something that Rep. [Brian] Sullivan asked for, and I have no problems putting annulment back in.”

Despite the sometimes rocky exchanges at Wednesday’s meeting, Simon said he’s still optimistic that lawmakers will be able to come together, negotiate, make concessions and unite around a bill that will ultimately make it into law.

“People are ready for legalization. And we just want to see a bill that makes sense for New Hampshire,” he said. “This committee may be the best opportunity to to make that happen.”

Karen O’Keefe, Marijuana Policy Project’s director of state policies, said the House Commerce Committee “should advance a bill that includes annulment, non-discrimination protections, ample opportunities for small business, and that avoids poison pills that re-criminalizes consumers or creates prohibition 2.0.”

“At long last, New Hampshire has a window of opportunity to get legalization done,” she added. “It’s essential the legislature seize the opportunity and send the governor a bill he won’t veto. But there are numerous policy issues the General Court can decide within his parameters that it needs to get right.”

Led by Sen. Daryl Abbas (R), the state commission charged with studying how to legalize marijuana in New Hampshire issued its final report in December, capping off months of meetings at which members failed to agree on a way forward for cannabis policy in the state.

“Ultimately, the Commission voted not to recommend legislation for the 2024 Session,” the new report says. “The Commission was unable to reach a consensus because of a large number of unresolved issues.”

Among the issues the group failed to craft agreements on were the allowable THC levels in legal cannabis products, penalties for public consumption, rules around the operation of motor vehicles, the creation of an oversight body to approve Liquor Commission rulemaking, measures to prevent access by minors, the number of allowed retail stores statewide and whether to allow or prohibit home cultivation.

During the bulk of its hearings, the Commission to Study With the Purpose of Proposing Legalization, State Controlled Sales of Cannabis and Cannabis Products conducted a line-by-line review of draft legislation submitted by Abbas in October, which his staff emphasized was intended as a starting point. But after weeks of sometimes testy debate among members, the body voted against recommending the bill to lawmakers.

While the body was already at loggerheads going into its final meeting, a list of last-minute demands by Sununu was a dealbreaker for some of the committee. The governor said he would support no more than 15 licensed marijuana retailers statewide and wanted to include provisions specifying that cannabis businesses be barred from lobbying or making political contributions.

Under the legislation that created the legalization study group, commissioners were tasked with studying the feasibility of a state-run cannabis model and specifically drafting legislation that:

1.  Allows the state to control distribution and access
2. Keeps marijuana away from kids and out of schools
3. Controls the marketing and messaging of the sale of marijuana
4. Prohibits “marijuana miles” or the over-saturation of marijuana retail establishments
5. Empowers municipalities to choose to limit or prohibit marijuana retail establishments
6. Reduces instances of multi-drug use
7. Does not impose an additional tax so as to remain competitive

Hunt’s committee worked extensively on marijuana reform issues last session and attempted to reach a compromise to enact legalization through a multi-tiered system that would include state-controlled shops, dual licensing for existing medical cannabis dispensaries and businesses privately licensed to individuals by state agencies.

The panel, however, reached an impasse on the complex legislation, which was being considered following Sununu’s surprise announcement that he backed state-run legalization. Meanwhile the Senate defeated a more conventional legalization bill, HB 639, despite its bipartisan support.

In May, the House separately defeated a different marijuana legalization amendment that was being proposed as part of a Medicaid expansion bill.

Also, the Senate moved to table another piece of legislation that month that would have allowed patients and designated caregivers to cultivate up to three mature plants, three immature plants and 12 seedlings for personal therapeutic use.

After the Senate rejected reform bills in 2022, the House included legalization language as an amendment to separate criminal justice-related legislation—but that was also struck down in the opposite chamber.

This story was updated to correct a transcription error in comments from Karen O’Keefe. Marijuana Moment regrets the error.

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