The key to understanding cannabis prohibition: an explanation of the legal arguments which the federal government uses to justify permanently prohibiting the medical use of cannabis appears in my article Madmen Rule You.

Tuesday, September 23, 2014

Calm before the storm: cannabis market legalization in New York

New York is quiet for the moment but battle royale is coming in the next legislative session. People know that New York has a "medical marijuana" law but they don't know what it means. Very few people know yet that there is an opportunity to create a fully legal cannabis market like exists in Colorado but they will soon and then things are going to get very interesting here.

Amendment of the medical use-only legislation

It is common knowledge among people who are paying attention that the medical use-only statute, the Compassionate Care Act (the "CCA"), that Governor Cuomo forced upon New York State in June, is a dysfunctional debacle. It is so obvious a disaster that the reformers are talking about reforming it in the very next legislative session.

There are many problems with the CCA, most of which are Cuomo's doing. In the last two days of the legislative session in June he launched a savage surprise attack on the cannabis law reform movement, which by that time prominently featured parents desperate to obtain lifesaving treatment for their children with severe epilepsy.  The purpose of a medical use statute should to be facilitate access to cannabis by sick people, i.e. to get government out of the way. Instead, the CCA in the form into which Cuomo contorted it is a set of disincentives for anyone to enter the market: among just a few examples are increased responsibilities for physicians combined with new criminal penalties, a requirement that physicians get additional licensing from the state before they can certify patients, a plainly absurd maximum of five cultivation licenses for the whole state, and the two most mind-blowing provisions - (i) the authority of the Governor to delay issuing licenses to applicants until the Health Commissioner and Police Superintendent certify that the program can be implemented safely - with no date certain by which the licenses must be issued - and (ii) the authority of the Governor to terminate all licenses immediately upon the recommendation of the Health Commissioner or Police Superintendent. This is not a statute that can create a viable medical use market. It is an illusion.

Emergency access - The current focus of certain activists is to force Cuomo to issue an executive order creating emergency access to cannabis for people who will not survive until the implementation process is completed. Following the death of several small children at the end of July, including one whose parents had advocated passage of the CCA, Cuomo requested that the acting Health Commissioner review the eighteen-month implementation timeline to determine whether it is possible to expedite the process of getting cannabis to children with epilepsy. In response, Assembly Member Richard Gottfried, the longstanding champion of rational cannabis policy here in New York, stated to the press that Cuomo himself had insisted that a provision in the draft legislation providing for emergency access pending full implementation of the statute be removed.

Cuomo set himself up for some very bad press by sabotaging legislation intended to provide relief to sick people. It makes sense that activists would want to focus on emergency access. However, there is a much bigger defect that must be corrected.

Advisory committee - The CCA as enacted omits what was the very best part of the proposed legislation: an advisory committee tasked with assisting the Health Commissioner in promulgating regulations. Creation of an advisory committee to assist in drafting regulations is a "best practice" in designing viable cannabis markets. There is no justification for eliminating the advisory committee from the statute.

The significance of the advisory committee is as follows. Assuming that the goal of passing a medical use statue is to get cannabis immediately into the bodies of sick people whom it helps (and not simply to provide a photo opportunity to a politician who has just rendered the legislation useless), then the most critical thing to do is to formulate good regulations as quickly as possible. The best thing to do is to create a highly transparent rulemaking process that gives an opportunity for all stakeholders to state their positions to each other as early as possible so that as many disputes can be resolved through negotiation as possible instead of through litigation. As drafted, the advisory committee would have consisted of a set of experts from different backgrounds, including law enforcement, substance abuse prevention, patient advocacy and clinicians, who would be able to create numerous other working groups. This is essentially the process followed in Colorado, Washington and Massachusetts. It's really something of a no-brainer. Of course you would want to bring together experts who have experience in the operation of legal cannabis markets in other jurisdictions and representatives of New York stakeholders so you can get the regulations as close to perfect as possible as early in the process as possible. Yet the advisory committee did not survive Cuomo's attack and so does not appear in the statute as enacted.

The fact that there is now a medical use statute in New York is nice but it means nothing until it is implemented and the key role of the advisory committee is to facilitate implementation.

The sponsors of the CCA are already talking about amending it in the coming legislative session. I propose that efforts to amend the CCA include the following:
- Restoring the advisory committee;
- Adding a provision that individual patients and caregivers can still assert medical necessity as a defense to prosecutions for cannabis law violations even if they are not licensed by the Department of Health;
- Eliminating the fixed list of conditions for which a patient can be certified to use cannabis and thereby restoring a physician's discretion to recommend cannabis in accordance with his/her professional medical opinion;
- Including an express statement as to the degree to which the CCA prevents ("preempts") local governments from regulating the cannabis market. A provision of this type should aid tremendously in minimizing litigation. 
Full legalization

The situation in New York is volatile. The CCA is untenable and the activists want vengeance. We can assume that one track in which reform efforts will proceed is amendment of the CCA, as discussed. However, the much more interesting track will be the effort to pass the Marihuana Regulation and Taxation Act ("MRTA"), the full legalization bill first introduced last year by Senator Liz Krueger and Assembly Member Crystal Peoples-Stokes.

Passage of the CCA did one thing if nothing else: the brutal power play that wrecked the bill showed how Cuomo operates. Last year, he began making ambiguous statements suggesting a new openness to permitting medical use of cannabis, refused to meet with reformers, and then blindsided them with impossible demands just days before the end of the session. His element of surprise is now gone. It's fair to assume that Cuomo and the Senate Republicans, having opposed the CCA, will scorch the earth to prevent passage of the MRTA. (It may be that as part of the price for defeating the MRTA they will need to allow reasonable amendments to the CCA.)  At the same time, it is a full legalization scheme like the MRTA, not the CCA, that has the potential to bring out mass support for reform.

This year a new phenomenon appeared in New York City: well-attended monthly and weekly meetings of cannabis law reformers and Green Rush entrepreneurs in midtown Manhattan in groups such as the Marijuana Business Association, High NY and the Cannabis and Hemp Association. There is a rapidly-increasing number of investment/commercially-oriented events taking place here, such as last month's meeting of the National Cannabis Industry Association and the upcoming meeting of the International Cannabis Association.

Thus, there are three factors coming together as we head into the 2014-2015 legislative session: (a) the longstanding outrage over NYPD's practice of arresting black and brown young men for possession of cannabis in amounts that were decriminalized decades ago, (b) the obvious failure of the medical use law at Cuomo's hands and (c) the natural entrepreneurial inclination of the citizens of the capital of capitalism. I expect that these three factors are going to fuse by January 2015 and yield a new multifaceted movement reflecting the diversity of the City's population that will demand real change. After Massachusetts passed its medical use-only law, I said that the battle front had reached the outskirts of New York. It seems to me now that the battle is about to begin within the City. We're just in the last traces of the calm before the storm.

Friday, August 22, 2014

Cannabis law reform appears as a subject of debate in a New York congressional race

This short article on a Congressional race in the far eastern end of Long Island focuses entirely on the candidates' differing views on cannabis, indicating to me that this issue may become a subject of debate in the campaign.

I assume that the story results from a conclusion by Lee Zeldin, the Republican challenger, that he can score points against Tim Bishop, the Democratic incumbent, due to Bishop's vote in support of a monumental, unprecedented bill in the House of Representatives that would restrict the DEA's ability to act against medical cannabis systems in states where it is legal.

The article is full of dubious characterizations (e.g. saying that Zeldin defers to the states when his position is the opposite: to the contrary, he recites the classic DEA position that we are all enslaved to the FDA), but I consider it a sign of progress that cannabis law reform is now a valid topic of debate in New York politics. By way of contrast, when John Liu and Sal Albanese each declared their support for cannabis legalization as candidates for Mayor in New York City's most recent mayoral election, the story made no impression.

I am curious to see if this issue appears in the election - maybe Zeldin's campaign director will decide it's a loser. If it does appear, I will be very impressed if the candidates can move beyond obsolete catchphrases and instead conduct a real policy debate.

Friday, June 20, 2014


I printed out the Compassionate Care Act, New York's "medical marijuana" law, to read over the weekend. 

Just skimming through it I can see there is a lot of new stuff, suggesting that Cuomo's people played the timing masterfully - waiting until the last minute to spring counter-legislation they had drafted far ahead of time after refusing to talk to patients for months. 

What I have seen so far is really bad; for example, the program will take effect ... when the Commission of Health and the Superintendent of the State Police decide it can start.

In the meantime there is no individual right to cultivate and a doctor's certification by itself provides no affirmative defense to criminal prosecution. This is the New Jersey experience but on a far grander scale (because in New Jersey the statute passed before Christie came in and he could not utterly sabotage it, just delay its implementation.)

It's going to take a little while before people realize how badly they lost this round.

The significance of this experience is that it is the warm-up round for battle royale on full legalization. We see how Cuomo operates; in a sense he has shown his hand. Passage of the CCA was a valuable lesson in the nature of this fight, nothing more.

As George Martinez says, block by city and city by city. Passing the Marijuana Regulation and Taxation Act is going to be hand-to-hand combat and now we see how Cuomo fights.

Thursday, May 8, 2014

The medical bill: New Yorkers should fight against the amended Senate version - not retreat under fire from the Senate Republicans

As I have said before, I consider the medical use-only bill (the Gottried-Savino "Compassionate Care Act") a waste of time since I don't believe the Republicans will actually allow it to pass, because a series amendments made in each year it was introduced have made the bill unnecessarily restrictive (and likely laying a a flawed foundation for the regulatory system that will require ongoing reform) and it will be counterproductive to meaningful reform if it does pass, and without an individual cultivation provision it means nothing: patients will still not be able to access cannabis through direct self-help because the option of growing a plant will remain illegal.

The amended Senate bill

Senator Savino recently introduced an amended bill into the Senate. As revised, the bill is worse and needlessly so. I assume that these revisions are being extracted unwillingly from Senator Savino and so the Republicans (Kemp Hannon, backed by Dean Skelos) are at fault.  

The revisions for the most part seem to be totally arbitrary. 

Limitation on conditions

The bill now limits the number of conditions for which a physician can recommend cannabis (so that a patient can apply to registered and licensed with the Department of Health). See Section 3360(7). The previous bill counted off certain conditions as examples and then said "including but not limited to," i.e. a physician could exercise maximum discretion in deciding whether an individual patient would benefit from cannabis and in what form. 

The new bill adds amyotrophic lateral sclerosis, Alzheimer's, muscular dystrophy, traumatic brain injury and post concussion syndrome, dystonia, and psoriasis. It eliminates glaucoma, and limits it arthritis to rheumatoid arthritis.  

Was there a rationale for changing the enumerated conditions?

The bill gives to an advisory committee (discussed further below) the job of recommending to the Commissioner of Health whether to add or subtract conditions from the list of "serious conditions" for which a patient may use cannabis. Under the terms of the statute the advisory committee must include law enforcement, industry professionals and drug regulators. Why should the decision whether to allow a patient to obtain cannabis for a condition not in the official list (i.e. expanding the list) require input from police and industry professionals let alone drug regulators?

Why does the amended bill restrict practitioner discretion at all? 
Why would the legislature micro-manage the practice of medicine in that way?


Changes to the function of the Advisory Group

Back in June of last year, before the latest round of bad revisions begin, I said that the advisory group that the Commissioner of Health will be directed to form is a really good part of the bill. 

The function of the advisory group in the original bill was to advise the Commissioner in promulgating regulations, which will be the next major effort after the bill is passed. The amended Senate bill now assigns two new functions to the advisory group that I consider inappropriate. The changes on wish I wish to focus basically turn this working group, which is presumably only temporary or as-needed by the Commissioner, into a permanent administrative law tribunal.

The first one is adding or removing different conditions from the list of conditions for which a patient can be issued an ID card, as discussed above.

The second one is something that seems to turn this group, that is supposed to consist of various experts and stakeholders, into an appellate panel inside an administrative agency: it assigns to this working group responsibility for reviewing appeals by patients and designated caregivers from agency decisions denying applications for ID cards.

The CCA thus creates a two-step appellate process in order to challenge denial of a registry identification card. (A patient must have this state-issued ID card in order to obtain cannabis from a store under the CCA - since it does not permit individual cultivation.) The patient must submit the appeal first to the advisory committee, which reviews the appeal and sends its recommendations to the Commissioner. This system is instead of simply creating an administrative appeals process within the Department.   

Why create an extra step in the process of appealing denial of a patient's application to obtain cannabis (when the patient should be able to grow the plaint)?
Why in the world would an advisory group that is supposed to assist the Commissioner of Health in formulating regulations also be charged with acting as an appellate tribunal in an administrative agency? 

Who would want to sit on such a panel?
How many appeals will there be?
Instead of agreeing to participate a series of meetings to draft proposed regulations you would agree to be sucked into acting as a judge for a caseload of appellants - with no sense of what volume of cases there might be.  

How much money will it cost to route those appeals through an advisory committee whose primary task is advising the Commissioner in formulating regulations.
Why wouldn't this type of appeal be heard by an appellate panel that exists within the Department?

What was the rationale behind that change?

There is still a statutory limit on the number of cultivators that can be licensed in the first two years

The version of the bill introduced last June set a maximum number of ten cultivators for the first two years in the law is effective. I explained that I thought that provision was so bad that the bill should not be passed.

The amended version of the bill (see Section 3365(9) now raises the limit to 20.
That's better but ultimately so what?
What is the rationale for a statutory - as opposed to regulatory - limit on the number of cultivators that can be registered? Who cares what the number is - is there any valid rationale for a statutory limit?

Was there an attempt to project the demand in New York and the distribution of that demand across the state and an attempt to project what type of operations would be necessary to meet the demand?


Proposal for an activist agenda: make demands

The revisions to the bill only take, they don't give.
It would be appropriate to stop being on the defensive and fight back.

The problem with the CCA is that there is now a much better option - Senator Liz Krueger and Assembly Member Crystal Peoples-Stokes' full legalization bill.
If there is going to be further effort into passing the medical use-only bill, then it should be dedicated to passing a good bill not a bad one. 

Here is what I propose as an activist agenda:

(1) The Republicans in the Senate Health Committee must be made to explain what is the rationale for the latest set of amendments to the bill. Then we will know whether they are legitimately trying to solve problems that likely could be solved in a less restrictive way or if they are simply toying with the process with the intention of stonewalling a legal cannabis market for another year.

It is worth knowing whether the representatives of the people have a methodology when they pass laws or they just kinda wing it - or if perhaps they are trying to thwart the process. 

(2) At a minimum, activists should demand that an individual patients' right to grow be put back. 

Many years back (at least 2007, maybe even more recently) the bill protected the right of an individual patient and his/her designated caregiver to cultivate for the patient. That provision was eliminated. Since at least 2010, the bill allows only corporate entities to cultivate.
Protection of the right to individual cultivation should be restored because: 

(a) if you are really reforming cannabis law, then recognize that it's insane to ban a plant, and 

(b) even if the current CCA passes, patients will not experience immediate relief. The next step will be to draft the regulations that will govern licensing of the corporate entities that will be the allowed to cultivate and it could be a year from the date on which the law takes effect to register the cultivators. As happened in NJ, patients will be stuck without a legal source during the process of enacting regulations. How long after that will the cultivators be able to begin distributing the product? 

We can already anticipate that the likely emergence of mega-farms (due to the limit of 20 cultivators) in the first two years will keep prices artificially high. 

On top of the delay, we have no idea how restrictive the Department of Health's regulations will be.
If people can get their medicine by growing a plant then why.impose.criminal.penalties.for.growing,it.

It's a plant. 
It grows.
How, as a rational government, can you ban a plant?

The state government can allow access at the flick of a switch (subject to the cultivation skills of patients and/or their designated caregivers). If the legislature is serious about allowing patients access to cannabis, then it is a no-brainer to legalize individual cultivation immediately with regulatory authority in local governments subject to a clear process for challenging excessive restrictions


There is no doubt that the Senate Health Committee must explain why there was a need to revise the bill to create a system that seems arbitrarily over-restrictive.

If the Senate insists on the changes described above, then the activists should come back with their own demands.

There is much better legislative option now, the full legalization bill. When a much better full legalization bill is available, there is no reason to accept a bad medical bill.

Tuesday, March 18, 2014

Relatively new developments in New York and some comments

I didn't notice until today that Crain's New York Business is following the progress of the Compassionate Care Act, a/k/a the proposed New York "medical marijuana" law.

For the first time ever the CCA is attached to the budget, meaning, it is said, that this year we can expect open debate in the full Senate.

Four upstate Republican Senators are breaking with the party leadership and coming out in support of the bill. (One of them, Mark Grisanti, put it on his website.) There is some irony in this development, since the Republican resistance appears distinctly now to be headquartered in the downstate county of Nassau (one of two comprising Long Island), right across the border from New York City.

I'm curious as to what opposition Senators Hannon and Skelos will assert against the CCA. I assume that for the sake of appearances if they do drop their resistance this year they will need to do it in some way that does not essentially admit that there never was any valid basis for opposition. In other words, they will need to do a Cuomo - come up with some novel (but non-viable) counter-proposal from which they will allow themselves to be negotiated so they can say they are satisfied with compromises in the bill.

My continuing objections to the bill

I continue to oppose the CCA for various reasons but primarily to the extent that it sets an arbitrary limit of ten manufacturers for the first two years. I assume that the limitation will tilt the market at this foundational stage towards very large entities with the capital/credit available to create operations large enough to service the population of the New York City metropolitan area - plus the remainder of the state. It will also likely drive up costs for people in the upstate counties whose product will be transported from other locations in the state, i.e. there will be no option for local cultivations for at least 52 of New York's 62 counties. (In other words, if each of the manufacturers is licensed in a separate county, there will be still be 52 counties in which there is no manufacturer.)

Since there seems to be no way out of this restriction, I believe that the task at hand will be to convince the Commissioner of Health that the statute permits manufacturers to franchise their manufacturing operations to multiple locations. I see nothing in the statute that would prevent franchising; I also note that the New York franchise law doesn't seem to include manufacture of products as one of the activities defined as the subject of a contract for a franchise (which then requires registration with the Attorney General's office).

Since the new version of the statute eliminates the limitations on common ownership of manufacturers and distributors, I assume that there will not be a problem with manufacturers franchising retail operations. That may be something that can be crafted out of the statute. However, there is no arbitrary limitation on retailers so that kind of franchise just helps those ten (presumably) very big manufacturers participate in the retail market as well - competing with businesses that are exclusively wholesale or retail distributors. It won't likely help small entrepreneurs who seek to get started in cultivation.

Just a few guesses. I'm interested in comments from people with experience in New York franchises.

Sunday, February 16, 2014

Psychedelic free market

The task at hand is to remove the artificial controls from the market of psychiatric medications.

Tuesday, January 14, 2014

Test whether Cuomo is serious: when do we see the Executive Order?

The articles and comments I have seen concerning Governor Cuomo's proposal to re-implement the old, defunct Oliveiri Statute by executive order have been uniformly skeptical of his plan.

Some of them made the objection I did, which is that no hospital worried about losing federal funding is going to participate (although the article at the foregoing link indicates that there are hospitals interested in the idea).

I believe there is one fundamental question that must be addressed, ahead of all questions about whether hospitals will participate, what patients will be eligible and what will be the source of the cannabis (if Cuomo succeeds in hoodwinking the legislature into letting his executive order bypass the legislation that would create a licensed private-sector supply side).


We need a date certain by which he will issue the executive order, a statement as to who will be the point person to implement the order, and a date by which regulations will be promulgated. I explained in my first post on this topic that Governor Christie of New Jersey pulled a similar ploy in 2010: he tried to obstruct implementation of that state's program by proposing that Rutgers University grow cannabis as an alternative to implementing the duly-enacted statute. The New Jersey statute, enacted before Christie became governor. provide for creation of six "Alternative Treatment Centers." Although the statute as enacted called for creation of the ATC's and promulgation of regulations, the Christie administration failed to promulgate regs and instead Christie suggested ignoring that part of the statute and handing off cultivation to Rutgers. That didn't work but it delayed things for a little while.

Back to New York: I expect that unless people demand a date certain by which the executive order will be issued, Cuomo will delay until far enough along in the session that there will be insufficient time for advocates to analyze whether the plan is viable before this issue disappears into the whirlpool of other policy disputes. There was a big news splash when the Governor made his announcement, Assembly Member Richard Gottfried has stated that the Governor's support for implementation of a medical cannabis supply is good but new legislation is needed, and now all is quiet.

If Governor Cuomo is serious - and his announcement is not simply a political ploy - then he must state a date certain by which the order will be issued. Otherwise, his proposal is just a means of derailing the Gottfried-Savino medical cannabis bill and the Krueger-Peoples-Stokes general legalization bill.