Could Interstate Cannabis Commerce Be on the Way?

By Ivy Summer

Both the pandemic and recent wildfires in California became obstacles to the recent effort to legalize interstate commerce. However, California is very likely to join the campaign pioneered by the Alliance for Sensible Markets (ASM). The fact that governors across New York, New Jersey, Rhode Island, Pennsylvania, and Connecticut thoroughly discussed policies around this in 2019, and Oregon’s governor signed a bill last year moving this effort forward, goes to show that this potential is proactive and not just performative.

Sen. Ron Wyden (D-OR) and Rep. Earl Blumenauer (D-OR) filed a bill that would prevent interference by the Justice Department in the coalition’s effort. Aside from that, the cannabis industry is one of few that are positioned to provide more jobs and economic recovery from the current recession.

If and when interstate commerce will be allowed, the cannabis market has its foot in the door to expand its opportunities in states like New York and New Jersey, which don’t have outdoor grow operations comparable to California. Expansion can enable such states to generate revenue and taxes that can make a significant impact and potentially result in funding other industries, like education and construction, for example. Ramifications could include the cost of cannabis going down, the ability for up-and-coming brands to compete in other markets, and the possibility of federal allowances for states to import medical cannabis before its market officially opens. That would be a particularly positive export opportunity for states with smaller populations that overproduce cannabis.

Initially, the import and export of cannabis from other states will require federal law or policy to support it. That said, removing cannabis from its current Schedule I status from the Controlled Substances Act and the first stages of interstate commerce may depend on federal legalization, but that doesn’t necessarily mean that this will always be the case. Interstate commerce may be coming to the U.S. sooner rather than later, and it’s in part dependent on the swift actions of President-elect Joe Biden. Otherwise, we might see a huge shift in this movement by the end of the decade based on how quickly this emerging industry is evolving along with related legislation in states where it has been and is expected to become legalized on the state level. But that doesn’t necessarily mean interstate commerce will be a milestone accomplished in the foreseeable future.

According to the State Cannabis Commerce Act of 2019, the two-step process for setting up interstate commerce is comprised of

  1. Getting two or more states that have legalized cannabis to establish a commerce pact, and
  2. Advancing Congressional approval in the 2021 legislative session.

The beginnings of interstate commerce may create viable business opportunities for markets that don’t involve physical work with the plant. It will also depend on public support for interstate cannabis commerce, and some regulated, high population states, especially in the Midwest, can easily affect the timeline. Due to the stigma and political barriers, we can expect it will be a long road to bring cross-border cannabis commerce to fruition.

What are your thoughts about this topic? Send an email to [email protected] to send an inquiry to Ivy Summer or drop a comment here with your two cents.

About the Author:

“Ivy Summer is an independent consultant and collaborator with ECO Cannabis with 5 years of experience working in the cannabis industry both as a consultant and wedding planner. She introduced the annual Cannabis Wedding Expo to California in 2016 and launched America’s first cannabis art museum tours and cannabis yacht tours from 2016 through 2018.

From your workforce, content, or your customer base to your daily interactions – if you aren’t sure how to start incorporating diversity, equity, inclusion, and belonging into various aspects of your life, and you want to commit to making an intergenerational impact in business and beyond, Ivy is your go-to. “Let’s make a diversity committee,” is one of the most common phrases she hears from her prospective clients. She’ll take you deeper. She helps solopreneurs and small-to-medium sized organizations develop ownership over real systemic change within their community and champion diversity and inclusion initiatives they never thought possible. Ivy specializes in identifying areas of business that hinder an organization’s potential for diversity and recommending how to establish best practices in a sustainable way.”

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