The governor of Rhode Island signed a bill on Wednesday to legalize marijuana, making it the 19th state to end prohibition.
While it will be at least a few months until adult-use retail sales launch in the Ocean State, adults 21 and older can now legally possess up to one ounce of cannabis and grow up to six plants for personal use, only three of which can be mature.
There were months of negotiations between lawmakers, advocates, stakeholders and the governor’s office before a revised version of the legislation was introduced earlier this month. But once the text was released, the identical companion bills in both chambers quickly advanced through committee and were approved on the floor on Tuesday.
Gov. Dan McKee (D), a proponent of legalization who released his own reform plan as part of his budget proposal this year, signed the measure just one day after the legislature sent it to his desk.
The governor said at the signing ceremony that getting this legislation enacted “took a great deal of effort—it certainly wasn’t a straight line. It took hundreds of hours of work, meetings, stakeholders sessions, negotiations and collaboration. And that’s how good legislation gets done.”
“The bill I signed today into law ensures that legalization is equitable, controlled and safe,” he said. “Those were three things that were very important to all of us when we were negotiating this final agreement as Rhode Island begins this new chapter.”
Lt. Gov. Sabina Matos (D) and Senate Majority Leader Michael McCaffrey (D) joined the governor at the signing ceremony, as did the two lead sponsors of the legalization legislation, Rep. Scott Slater (D) and Sen. Joshua Miller (D).
“Knowing that cannabis prohibition has been a failed policy for decades, we’re glad that we got to this point so that we can have the bill signing,” McCaffrey said.
Miller remarked that “it has been a long road” to legalize marijuana in the state, “but I couldn’t be happier with the result.”
Slater said that he’s “proud of the product that we put forth in this in this legislation,” highlighting its social equity provisions.
“I think it’s probably one of the best legalization bills” in the country, he said. “I’m a little biased.”
The primary components of the now-enacted law are largely consistent with an earlier version of the bill as introduced and considered during earlier committee hearings in March.
Adults 21 and older will be able to purchase and possess up to one ounce of cannabis and grow up to six plants (only three of which could be mature) for personal use.
Possession and cultivation are immediately permitted, assuming security requirements prescribed in the bill are met for adults who choose to grow their own plants, but the first retail locations won’t open until December 1, 2022 at earliest.
The allowable possession limit for marijuana stored in a given household will be maxed out at 10 ounces.
The state will automatically expunge prior marijuana possession convictions for amounts now made legal by July 1, 2024, but those who petition the court for relief will have their cases expedited.
Regulatory responsibility will be shared by a new independent Cannabis Control Commission (CCC) and an administrative Cannabis Office. A new advisory board would also assist.
The governor will be responsible for making appointments to the CCC.
Adult-use marijuana sales will be subject to the state’s seven percent sales tax, a 10 percent excise tax and a local three percent tax for municipalities that allow cannabis businesses to operate.
For the initial rollout, a total of 33 marijuana retailers can be licensed. Twenty-four of those licenses could be new standalone adult-use retailers, divided up equally between six geographic zones of the state, and nine other hybrid licenses could be approved for existing medical cannabis dispensaries if they pay a $125,000 fee for the privilege to add recreational sales.
Of the 24 standalone retailers, 25 percent will need to go to social equity applicants and another 25 percent will be for worker-owned cooperatives.
No single entity will be allowed to possess more than one business license, but people can invest in multiple companies.
Approved hybrid licensees can start to grow and manufacture marijuana for adult consumers starting August 1, 2022.
Possession of more than one ounce but up to two ounces for adults 18 and older will be decriminalized, with people facing a civil penalty without the threat of jail time.
Part of the money collected from cannabis licensing fees will support a new “Social Equity Assistance Fund.”
The fund will “provide assistance to applicants from communities disproportionately impacted by prohibition of cannabis,” according to an earlier summary.
Equity business applicants will need to meet one of several criteria to qualify, including at least 51 percent ownership by people who have resided in a disproportionately impacted area for five of the past 10 years, 51 percent ownership by people who have faced arrests or convictions over offenses that would qualify for expungements under the law or having income that does not exceed 400 percent of the median income in a disproportionately impacted area for five of the past 10 years.
A business that has at least 10 employees, with at least 51 percent residing in disproportionally impacted areas or who have been arrested or convicted for an expungable offense offense under the bill will also qualify as would being able to demonstrate significant experience in types of businesses that promote economic development.
There will be a two-year moratorium on licensing additional cultivators beyond those that are already operating for the medical cannabis market.
Regulators will also be responsible for setting limits on “cannabis product serving sizes, doses, and potency, including, but not limited to, regulations which provide requirements for reasonable tetrahydrocannabinol (THC) potency limits for each type of cannabis product sold by a licensee and reasonable potency or dosing limits for cannabis concentrates and edible products, that shall apply for adult use cannabis only.”
Local municipalities can opt out of allowing marijuana retailers with voter approval via ballot referendums, but not if they currently have medical cannabis compassion centers operating in their jurisdiction. They could also set their own rules on public consumption through ordinances.
The bill also removes fees for medical cannabis plant tags and patient IDs once adult-use sales start.
Miller, who sponsored an earlier legalization proposal that was approved in the Senate last year, previously said that lawmakers “made our best attempt” to get the provisions right, and he stressed his openness to feedback from colleagues and stakeholders.
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Both Senate President Dominick Ruggerio (D) and House Speaker Joseph Shekarchi (D) have said they were comfortable with the move toward legalization, and they weighed in on various provisions related to issues like equity in the industry and the regulatory model for a cannabis market. But they’ve also said they were comfortable with the gradual pace of the reform and didn’t want to rush the legislative process.
Shekarchi had said that while he felt that reform was “inevitable” in Rhode Island, he wanted to take time to work with lawmakers on reaching a workable deal. And that’s now come to fruition.
Some of the initial differences between the lawmaker-led legislation and the governor’s proposed legalization measure were resolved in the enacted substitute amendment, and there were compromises made in other areas.
For example, McKee’s plan called for automatic expungements without a requirement for people to petition the court for relief. The compromise that lawmakers landed on was to provide automatic record sealing by a certain date while creating an expedited process for those who proactively petitioned for relief.
The governor also proposed having the state Department of Business Regulation be the sole regulatory body for the marijuana market. The agency would share that responsibility with an independent commission under the revised bill.
Lawmakers did not change their mind about permitting limited home cultivation for personal use, however, even though McKee’s measure would not have allowed home grow.
Under the governor’s plan, 25 percent of marijuana tax revenue and licensing fees would have gone to the “regulatory, public health, and public safety costs associated with adult-use cannabis.” Fifteen percent would have gone to local governments and 60 percent would have gone to the state general fund.
The executive summary of McKee’s budget proposal says that the state’s sales tax revenue would be “boosted by the proposed introduction of adult-use cannabis tax revenue in FY 2023.” The state is estimating that it will collect $1.2 million in general revenue for the 2023 fiscal year and $16.9, “with a full year of sales in FY 2024.”
The revenue projections and provisions largely reflect what the governor proposed in his last budget request, with the exception of the expungements language.
Not only would the governor’s plan not have allowed for home grow, it also set out a series of fines and penalties for personal cultivation of any number of plants. For example, a person who unlawfully grows one to five plants would have faced a penalty of $2,000 per plant and an “order requiring forfeiture and/or destruction of said plants,” according to the text of the proposed legislation.
The bill also included language to create a Cannabis Reinvestment Task Force that would have been required to study and issue recommendations on using marijuana tax revenue for “job training, small business access to capital, affordable housing, health equity, and neighborhood and community development.”
The proposal called for 25 marijuana retailers to be licensed each year for the first three years of implementation. Those would have been awarded on a lottery basis, but at least five would have been specifically given to minority-owned businesses. Additional licenses would have been issued in the future based on market demand.
The House Finance Committee discussed the governor’s proposal to end prohibition at an earlier hearing last year.
A coalition of 10 civil rights and drug policy reform advocacy groups—including the Rhode Island chapters of the ACLU and NAACP—had demanded that lawmakers move ahead with enacting marijuana reform in the state before the end of 2021. But that did not pan out.
Lawmakers have also noted that neighboring states like Connecticut and Massachusetts have enacted legalization, and that adds impetus for the legislature to pursue reform in the state.
Both the governor and the leaders’ legalization plans are notably different than the proposal that former Gov. Gina Raimondo (D) had included in her budget in 2020. Prior to leaving office to join the Biden administration as commerce secretary, she called for legalization through a state-run model.
McKee gave initial insights into his perspective on the reform last January, saying that “it’s time that [legalization] happens” and that he’s “more leaning towards an entrepreneurial strategy there to let that roll that way.”
Meanwhile, Rhode Island lawmakers introduced a pair of drug decriminalization bills in March—including one focused on psilocybin and buprenorphine that would authorize doctors to prescribe the psychedelic mushroom.
Last year, the governor also signed a historic bill to allow safe consumption sites where people could use illicit drugs under medical supervision and receive resources to enter treatment.
The Senate Judiciary Committee also held a hearing last year on legislation that would end criminal penalties for possessing small amounts of drugs and replace them with a $100 fine.
Photo courtesy of Philip Steffan.