Governor LePage Vetoes Maine’s Recreational Marijuana Bill

On Friday, Governor of Maine Paul LePage vetoed the state’s recreational marijuana bill. In one fell swoop, he reversed a campaign pledge made in 2014 and plunged the most lucrative emerging market, with a potential worth of $325 million annually, into political insecurity and dangling limbo. The Republican wrote in his veto letter that its legislation puts Maine in direct conflict with federal law.

LePage cited several reasons for his veto. He said the bill sets an unrealistic timeline for market launch, does little to address failures in the medical marijuana program, makes the regulatory system overly complicated, and that the tax revenues it generates may not be sufficient to cover the cost of implementing or regulating the market. In short, he considers the bill, risky, inconsistent, and expensive.

“Until I clearly understand how the federal government intends to treat states that seek to legalize marijuana, I cannot in good conscience support any scheme in state law to implement expansion of legal marijuana in Maine,” wrote LePage. “If we are adopting a law that will legalize and establish a new industry and impose a new regulatory infrastructure that requires significant private and public investment, we need assurance that a change in policy will not nullify those investments.”

The bill is now on its way back to Legislature. On Monday, supporters will attempt to get the two-thirds majority the bill needs to override LePage’s veto, which did not come as a surprise to anyone. During last month’s special vote session, the Senate agreed 22-9 to implement the bill and the House also voted 81-50 in favor of it.

If, on Monday, those vote margins remain, then the Senate will have enough votes to quash the veto. However, the House would not. Legislators have been counting votes and attempting to sway opponents, particularly those in the House, with both sides of the argument. Lawmakers are confident that their efforts will prevail.

Senator Roger Katz, representing Augusta, co-chairs the committee responsible for writing the implementation bill. Katz is explaining to colleagues that the vote to override the veto is not about legalization, but about regulation. “The legalization ship has sailed,” Katz said. “The people have spoken. It is not about whether you voted for legalization. I certainly did not vote for it.”

Katz then explained with this statement, “But that is not what the bill is about. This bill is about taxing and regulating a market that the majority of Maine voters want, just as we do with alcohol, with tobacco. If we do not pass this bill, if we go back to an unchecked black market, we will go back to chaos. Who could want that?”

He believes that the proposed system for regulation would quickly pay for itself, and when the market is running smoothly, it will generate millions of dollars every year for Maine’s treasury. However, legislative opponents do not think that sending the bill back to Katz and his committee for additional work is “the end of the world.” In fact, it would not even cause much of a delay.

Ken Fredette, House Minority Leader, is lobbying to extend the current moratorium on the ballot-box law, which will stay in effect if legislators cannot find a two-thirds majority to veto LePage’s veto. According to Fredette, the committee requires more time to address the bill’s issues, particularly those provisions governing municipal regulation of recreational pot, proposed tax rates, and enforcement.

It is clear that policymakers need some time to understand the bill. The committee did most of its work on it in late spring, when the state budget was preoccupying most of them, and in summer, when most were on vacation. Of the proposed bill to override LePage’s veto, Fredette said, “It will be close, but we will probably have the votes necessary to sustain a veto.”

Fredette does not think the bill will go away. He said, “It is still going to happen. We are not trying to kill legalization or stall it. We are back at work in less than two months, but to me, more important than when we are going to do it is how we are going to do it. Let us do it responsibly. Let us do it right. It is still a federally illegal drug, after all. If we are going to go there, let us do it with a consensus bill.”

If the attempt to override the veto fails on Monday, Fredette will do what he can to revive his moratorium bill, which would make January 2019 the date for lawmakers to start making laws. Under the implementation bill, that is roughly the same time supporters thought the first retail sales would start. Retail was set to start in February 2018, but the committee never thought that deadline possible.

If the bill does not succeed in overriding the veto, then the original ballot-box law, called the Marijuana Legalization Act officially, would continue unabated. However, a moratorium on the commercial aspects of that law would stay effective up until February next year. Residents in Maine could continue to carry 2.5 ounces of pot and grow six plants at home.

Until the moratorium expires or the governor adopts an implementation bill, people in Maine will not be able to buy or sell marijuana legally. The regulatory bill is notably more conservative than the legislation that voters approved. It doubles the initial tax rate, bans the gifting of cannabis, removes license preferences for medical pot caregivers, sets a residency requirement of two years for license applicants, and it prohibits home delivery, online sales, and drive-up windows.

The regulatory bill also requires municipalities to “opt-in” to the recreational market instead of opting out, which experts describe as a monumental obstacle to growing the industry. Advocates following the committee’s attempts to launch the new industry are at loggerheads over the veto. Some are praising the veto, others furious about it.

One opponent of legalization, namely Smart Approaches to Marijuana, said the bill includes “so many gifts to the pot industry at the expense of youth and communities.” Some groups are decrying the governor’s veto as obstructionism and others are saying that it gives the committee the time it needs to amend the bill before the governor can approve it.

Legalize Maine, a group of medical cannabis caregivers that wrote the referendum law, withdrew support for its own bill just last month. It cited last minute changes written behind closed doors as its reason for doing so, along with some of the rewrites reversing key aspects of the voter-approved ballot law, such as requiring host towns to opt into the market and stripping caregivers of license preferences.

About the veto, Legalize Maine’s Paul T. McCarrier posted on the group’s Facebook that “a poor, rushed process got us to where we are today.” However, LePage’s veto letter implied subtly that his notion of an improved implementation bill would journey deeper into the medical marijuana market than the original bill the committee wrote. He said in his letter that the committee bill failed to address issues in the medical marijuana program.

LePage envisions harmonizing regulations in both the medical and recreational industries, noting that the two tax rates and structures for regulation would undermine regulations put forth in the committee’s bill. He wrote in his veto “the two programs must be considered together.” He went further to explain in writing:

“Since the passage of the referendum last November, the medical program has seen a significant increase in the number of registered caregivers, as well as the exploitation of loopholes in medical marijuana regulations to broaden the sales base for medical marijuana, which has a much lower tax rate.”

The Marijuana Policy Project, an advocacy group with members nationwide, said that the governor’s veto is a poorly considered mistake that will empower the black market and allow it to continue unregulated and untaxed operations unhindered. State director of the project, David Boyer, accused LePage of breaking a promise made in a gubernatorial debate when he was campaigning in 2014.

During his campaign, LePage promised to support legalization if voters approved such a referendum. Boyer points out those other governors in other states who respected the wishes of their voters, despite some of them being ardent opponents of legal marijuana. “Seven other states have passed legalization initiatives over the past five years, and none has seen this type of obstructionism from its governor.”

Along with the District of Columbia, Maine is one of just eight states to legalize the use of marijuana recreationally. However, only five have launched markets for retail thus far. As with Maine, voters in Massachusetts adopted a law for recreational use last fall. In contrast, it has already appointed a Cannabis Control Commission, which is busily creating market laws with plans to begin sales next year.