Cannabusiness Advisory

Just before the start of Memorial Day weekend, U.S. House Judiciary Chair Jerry Nadler reintroduced the MORE Act – formally known as the Marijuana Opportunity Reinvestment and Expungement Act – which would federally legalize cannabis by removing it from the federal Controlled Substances Act. This would allow people with cannabis convictions to have their records expunged and would create a federal tax on marijuana with the revenue allocated to community reinvestment programs. This is not the first time the MORE Act has made its way through Congress. During the previous Congress, the House passed a similar version of the bill by a vote of 228-164, but it failed to advance in the Republican-controlled Senate.

If approved by both chambers and signed by President Biden – which is possible, but by no means a certainty – the MORE Act would provide enormous economic opportunities for plant-touching and ancillary businesses across the country. Further, federal legalization would disrupt the current patchwork of state-legal marijuana markets. To date, 18 states and Washington, D.C. have legalized adult-use cannabis, although states have yet to officially launch their programs. The opportunity for interstate trade and the formation of regional (and national) cannabis markets would spark market growth and, most likely, corporate consolidation.

Given the shifting political headwinds, the corporate sector is taking notice. On Tuesday, Amazon released a statement explaining that it intends to stop drug testing many of its workers for cannabis. In a full statement posted on its website, Amazon will now “no longer include marijuana in our comprehensive drug screening program for any positions not regulated by the Department of Transportation and will instead treat it the same as alcohol use.” In addition to its new workplace policy, Amazon has also announced its intention to lobby Congress to pass the MORE Act.

Social Equity

Despite the positive movement of legalization, many industry advocates have noted that federal legalization must ensure that racial and social justice will be a founding principle of any federal legalization regime. The MORE Act has been characterized as social justice-focused; in addition to “de-scheduling” cannabis, the bill calls for reinvestment in communities affected by the war on drugs and the need for an equitable and diverse marketplace. The bill includes a new Opportunity Trust Fund, which would provide funding for local job training, re-entry, legal aid, literacy, youth mentoring and health education programs for communities harmed by the war on drugs. Moreover, the MORE Act includes other social equity provisions like federal legalization of cannabis possession and automatic expungement of past. And with large corporations like Amazon and Uber positioning themselves for market entry, it is important that the federal government learn from the various social equity provisions enacted in the respective states. (See “Leveling the Playing Field: Various Approaches to Social Equity.”)

In the Senate, Majority Leader Chuck Schumer of New York is set to introduce a bill that builds on the MORE Act. Along with Senators Cory Booker (D-NJ) and Ron Wyden (D-OR), Schumer has stated that the Senate proposal would “ensure restorative justice, public health and implement responsible taxes and regulations.” Notwithstanding the procedural hurdle of the filibuster and likelihood of Senate approval, federal legalization is both encouraging and deeply concerning for many in the industry who fear that legalization will not adequately address the systemic harms of the war on drugs, while simultaneously prioritizing the interests of large corporations.