16 Jul 2021
Earlier this week, Senate Majority Leader Chuck Schumer (New York democrat), Senate Finance Committee Chairman Ron Wyden (Oregon democrat) and Sen. Cory Booker (New Jersey democrat), held a press conference to unveil legislation that shows the Democrats’ vision for cannabis reform at the federal level.
Several mainstream media firms have reported that the legislation will be called the Cannabis Administration and Opportunity Act (CAOA) which will include a wide array of cannabis reforms as well as social equity initiatives. With the Senate set for an August recess, we do not expect the CAOA to be officially introduced into Congress until late September.
Earlier this week, the media reported that the CAOA could include considerations that touch on the following topics:
Removing or lowering cannabis from being classified as a Schedule 1 substance. This could result in the elimination of 280E which would be a major catalyst for the industry
The bill could include language that provides clarity over the ability for federally regulated institutions to lend and provide general corporate banking services to state-sanctioned cannabis operators.
The legislation may include a pathway for publicly traded US multi-state operators (MSOs) to access US equity markets directly via major exchanges such as the NYSE and/or Nasdaq.
The bill is rumored to allow for states to continue enforcing their own legal platforms
CAOA could allow for interstate commerce which would be a major catalyst for US MSOs
The bill will likely allow for criminal record expungement for historical non-violent cannabis possession charges and the re-distribution of tax dollars to communities that were most impacted by this type of criminal enforcement.
The legislation may allow the Food and Drug Administration (FDA) to have ultimate oversight of any implemented federal cannabis regulations.
From interstate commerce to the removal of the 280E tax code, the legislation could prove to be a game changer for the US cannabis market. Although we are excited about the potential impact the legislation could have, we will wait until we see what is actually released or discussed at the press conference.
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