Feds soften stance on big pot growers

8/29/2013

LOS ANGELES—In a significant policy shift by the Obama administration, U.S. Attorney General Eric H. Holder Jr. signaled Thursday that the federal government would no longer interfere in states that allow commercial marijuana sales as long as they are strictly regulated.

The move comes two years after the Justice Department said federal drug agents would not tolerate large-scale or commercial pot businesses and launched a campaign to shut down dispensaries and growers. The crackdown was particularly aggressive in California, where hundreds have been shut down.

The new policy suggests the federal government is trying to find a workable balance between federal law, which prohibits all marijuana use, and laws in a growing number of states such as California that permit it.

Holder informed the governors of Colorado and Washington — where voters in November passed ballot measures to legalize marijuana for all adult use — that the Justice Department would not move to halt those initiatives.

Meanwhile, Deputy U.S. Attorney General James Cole wrote a memorandum to his top prosecutors around the country emphasizing that they should not automatically target marijuana operations solely because operate for profit and on a large scale.

“I was expecting a yellow light, but this light looks a lot more greenish than I had expected,” said Ethan Nadelmann, executive director of the national Drug Policy Alliance, a group advocating an end the so-called war on drugs. “The White House is essentially saying proceed with caution.”

He said the ramifications would be felt even in other countries, such as Jamaica and Uruguay, where officials feared their legalization initiatives would be squelched by pressure from the U.S.

Beau Kilmer, co-director of the Rand Drug Policy Research Center, said that while it was “a big deal” that the memo does not prohibit commercial, for-profit production, its scope is limited. It does not legalize marijuana at a federal level, leaves U.S. attorneys plenty of discretion to prosecute, and focuses only on the Justice Department.

“There are other federal agencies and departments that can play a role in all this. You’ve got the IRS, the Treasury, Customs ... It’s important to recognize that the federal government is not just a homogenous actor,” Kilmer said.

It’s unclear how the change in policy will affect California, where the medical marijuana industry remains largely unregulated.

The memo suggests that little might change in the state unless Sacramento implements some rules for the industry. “The department’s guidance in this memorandum rests on its expectation that states and local government ... will implement strong and effective regulatory and enforcement systems,” Cole wrote.

California’s rules on medical marijuana are murky to nonexistent. Certain counties and cities, such as Oakland, have created clear regulatory schemes, but Cole repeatedly calls for “state regulation.”

“This is a mandate for California to regulate medical marijuana,” said Dale Gieringer, a longtime activist and director of California NORML, the state chapter of the National Organization for the Reform of Marijuana Laws.

A regulatory bill died in the state Assembly over a procedural issue in May. State Assemblyman Tom Ammiano (D-San Francisco) hopes to reintroduce it, and key activists are hoping to get an initiative on the 2016 ballot to regulate all marijuana.

Steve DeAngelo, who operates Harborside Health Center in Oakland, one of the largest dispensaries in the U.S., called the move “a huge step forward for a sane policy on marijuana,” but worried about the details.

“It looks very, very promising on the face of it. But we won’t know the effects until it’s interpreted by the U.S. attorneys,” DeAngelo said.

Melinda Haag, U.S. attorney for the Northern District of California, filed papers last year to seize the properties where Harborside operated, and said in a statement at the time that “superstores like Harborside” went beyond what the state law allowed, implying its size was the key issue. She has also targeted growers in Northern California.

Cole’s memo doesn’t address the other methods the federal government is using to put cannabis purveyors out of business.

“We’re still facing crippling tax assessments, seizure of our properties, denial of banking, credit cards, security and armed car services,” DeAngelo said.

Cole said prosecutors should focus marijuana enforcement on several areas: preventing distribution of pot to minors, keeping revenue from flowing to gangs or cartels, preventing marijuana from being used as a front for trafficking in other drugs, impaired driving and growing on public land.

Gieringer, the California activist, noted that just because the memo said these were priorities over going after otherwise law-abiding citizens, “it doesn’t mean they don’t do it.”

In 2009, the Justice Department released a memo saying it would not prioritize targeting users of medical marijuana who were abiding by their states’ laws. That set off a boom of new dispensaries and pot farming in California, followed by a federal crackdown in less than two years.

Legalization opponents saw Thursday’s memo as a historic step in the wrong direction.

“This president will be remembered for many failures, but none as large as this one, which will lead to massive youth drug use, destruction of community values, increased addiction and crime rates,” said Paul Chabot, president and founder of the Coalition for a Drug Free California. “America may never recover.”

Sen. Charles E. Grassley, R-Iowa, co-chairman of the Senate Caucus on International Narcotics Control, said the administration’s action sent “the wrong message to both law enforcement and violators of federal law.”

“Apprehending and prosecuting illegal drug traffickers should always be a priority for the Department of Justice,” Grassley said in a statement.

Bert “Buddy” Duzy has a hard time believing the government is making an about-face. “They weren’t supposed to hassle California meds either,” he said.

Duzy heads the Reefer Raiders, friends and disciples of the late pot guru and author Jack Herer. The group has filed pot legalization initiatives in various forms since 1980.

He wants more radical change: taking marijuana off the list of Schedule 1 narcotics. “That’s been the holy grail for the cannabis movement for the last 30 years.”