Not long after the U.S. Attorney for the District of Oregon, Billy Williams, warned that overproduction and interstate marijuana trafficking would attract his prosecutorial wrath, the Oregon Liquor Control Commission halted the processing of new recreational marijuana applications. Now, the state legislature may give the OLCC permanent power to issue moratoriums on producer licenses whenever it sees fit.
Senate Bill 218, introduced in the infancy of the 2019 legislative session, authorizes the OLCC to refuse to grant recreational producer licenses, "based on market demand for marijuana and other factors the commissioner deems relevant," for however long the OLCC feels necessary.
While this proposed bill is far from being passed into law (and its finished form may not even resemble the current language) cannabis attorneys in the state have begun mulling the ramifications of refusing to grant licenses to farmers who have invested millions to break into the industry. For example, would the bill invoke the Fifth Amendment's guard against unlawful "taking" of property from individuals without due process after they've filed an OLCC application and paid the fee?
"The fact that a person has paid a fee does not, in and of itself, guarantee the person would have an application approved," said Ross Day, a Portland attorney. "Just because I submit a land use application and fee does not mean that my application is guaranteed to be approved."
That doesn't mean a prospective licensee who invested a huge amount of money into a marijuana farm in reliance on an application being duly considered wouldn't have a legal gripe, Day said. "The OLCC would likely argue that it intends to process the applications, but [they] need some time to catch up on the applications themselves."
The fact that no other licensee types (processors, wholesalers, retailers, etc.) are being targeted with the bill suggests it's a direct response to the frequent concerns aired by Williams— and echoed by local law enforcement in Deschutes County—that cannabis farms are simply producing more than Oregonians can possibly consume, and thus the oversupply is shipped across state lines.
AG Nominee May Respect Cole Memo
With the firing of Attorney General Jeff Sessions and the president's nomination of William Barr to fill the vacancy, marijuana businesses may, believe it or not, have reason to breathe easier. More than a year ago, Sessions formally rescinded the Cole Memorandum, which instructed federal law enforcement to respect state laws legalizing cannabis, provided that state regulatory schemes prevented interstate trafficking, money laundering, violence, etc.
When the president nominated Barr, a former Reagan staffer and Attorney General under George H.W. Bush, there was reason to fear the worst. Yet under Senate questioning during his confirmation hearings, Barr said, "I'm not going to go after companies that have relied on the Cole Memorandum." Barr made clear he's not personally a fan of legalization. "I think it's a mistake to back off marijuana. However, if we want a federal approach—if we want states to have their own laws—then let's get there and get there in the right way."
This is a stark departure from the anti-pot firebrand Sessions. Those wearing green-colored sunglasses might even interpret Barr's statements to be suggestive of de-scheduling marijuana so as to keep federal law in tune with states' rights. "It's incumbent on Congress to make a decision," Barr said.
Now that we have what Rep. Earl Blumenauer (D-OR) calls "the most pro-cannabis Congress in history," Barr's remark could end up as a de facto endorsement of legalization. There are currently at least five newly introduced (or re-introduced) cannabis bills in the 116th Congress which would ease federal interference in states where marijuana is legal, or outright legalize marijuana nationwide. That we have an AG nominee who claims he will not tip the scales to favor prohibitionists is just an unexpected bonus.
