Medical marijuana bill in trouble

Staff reportsMarch 11, 2014 

Proposed regulations on medical marijuana are stalled because of a debate over what to do with the tax revenue from recreational marijuana.

The state Senate on Saturday approved a bipartisan-backed merger of the medical and recreational systems that would shut down unregulated medical dispensaries and replace them with state-licensed stores.

But House Republicans are balking unless lawmakers give cities and counties a share of the tens of millions of dollars expected to flow to the state from Initiative 502.

While they are in the minority in the House, Republicans have leverage. Two-thirds supermajorities are needed to pass the bill because it amends I-502.

A 10 percent cut of I-502 proceeds would be enough to convince cities and counties to drop their bans and accept marijuana businesses, said Rep. Cary Condotta, R-East Wenatchee.

"We've got to get this system geographically rolled out across the state in order to be effective," Condotta said. "If you only have one part of the state participating, the other side is not going to come over and buy. They're going to buy from their existing sources."

But a key House Democrat said it doesn't make sense to give local governments an arbitrary share of tax revenue with no proof they will have more costs because of legalization.

"The argument for the initiative was that it's going to lower public safety costs, and now they're saying it's going to increase public safety costs with absolutely no data. (It's) troubling," said House Finance Committee Chairman Reuven Carlyle, D-Seattle.

Negotiations continue. The dustup makes the prospects for the bill "precarious," Carlyle said. "It could go either way."

Carlyle said waiting a year is an option but he wants to pass the Senate bill, which was largely worked out with House members ahead of time. If the Legislature doesn't pass some regulations, its risks running afoul of the federal government and leaving in place competitors to the new recreational system.

Democrats are looking at ways they might pass a bill that doesn't change I-502 and require a two-thirds vote, Carlyle said.

Medical-marijuana advocates are not exactly clamoring to have a bill. Pot-industry lobbyist Ezra Eickmeyer said the growers and sellers he represents are divided because the Senate-endorsed measure doesn't exempt medical sales from a 25 percent excise tax on retail sales. Many other advocates dislike the whole idea of merging medical with recreational sales.

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