Gov. Paul LePage plans to veto the recreational marijuana bill once it reaches his desk because it wouldn’t combine Maine’s medical and adult-use marijuana programs.
The two-term Republican doesn’t want two regulatory systems and tax structures for different uses of the same plant, according to his press secretary, Julie Rabinowitz.
“He was very explicit about problems with having two regulatory systems and tax structures,” Rabinowitz said of LePage’s opposition.
Lawmakers who support the compromise adult-use bill hope they will have enough votes to override LePage’s veto. The bill passed with veto-proof margins in the House and the Senate last week, but a veto could erode that margin, especially among House Republicans, who last year led the effort to sustain LePage’s veto of the first adult-use market bill. The new bill will land on LePage’s desk this week. He has 10 days to finalize his veto.
“We worked very hard to create a bill that addressed the governor’s concerns, as well as those of our colleagues,” said Rep. Teresa Pierce, D-Falmouth, the House chairwoman of the committee that wrote the adult-use bill. “Our bill has received strong support in both houses. I hope the governor will reconsider, but if he vetoes it, I’d hope that we can still count on their votes.”
LePage has been pushing more consolidation of the medical and recreational industries. If the pending adult-use bill becomes law, Maine would tax recreational cannabis at an effective rate of 20 percent while taxing medical marijuana at a much lower rate of 5.5 percent, or 8 percent for medical edibles. LePage believes the tax differential would encourage recreational marijuana users to use medical marijuana instead of the adult-use market to save money.
But Pierce notes the adult-use bill adopts a tax structure recommended by Maine Revenue Services, a division of state government that reports to LePage.
Sen. Roger Katz, R-Augusta, said Colorado’s experience with a medical-recreational tax differential even greater than the one Maine is proposing suggests LePage does not have to worry about recreational users flocking to the medical program to avoid paying a higher marijuana tax. In Colorado, the number of medical marijuana patients decreased after the adult-use market opened.
Consumers would have to buy a lot of marijuana at the lower tax rate to offset the $100 to $200 cost of obtaining a medical marijuana patient card, Katz noted.
LePage raised this concern when he vetoed the Legislature’s first attempt to launch Maine’s recreational market in November 2017. In his veto letter, LePage said having a medical program with weaker regulation and a lower tax rate would undermine the adult-use regulations and that these two programs must be considered together. He characterized the medical marijuana program as having failings and loopholes that caregivers are exploiting.
The lawmakers who crafted the latest adult-use marijuana bill believed they were addressing LePage’s concerns when they decided to move the medical marijuana program from the state Department of Health and Human Services over to the state Department of Administration and Financial Services, which would also be managing the recreational program.
In bill workshops, lawmakers said putting the two programs under the same regulatory umbrella would allow Maine to combine certain parts of the programs, such as the enforcement of packaging and labeling, while keeping the oversight of the health aspects of the medical program under the supervision of the Legislature’s Health and Human Services Committee.
Their attempts to find ways to consolidate parts of the two programs appear to have fallen short of LePage’s desire for a total merger but angered many on the caregiver side of the medical marijuana community, who consider the bill the first step toward abolishment of the medical program. Caregivers who oppose the adult-use bill said that moving the medical program out of the state’s health department will be bad for medical marijuana patients.
The bill would prohibit social clubs, reduce the number of mature marijuana plants that adults can grow at home from six to three, reserve preference of retail licenses to Mainers who have lived and paid taxes in the state for at least four years, let municipalities regulate local cannabis businesses but not give them a cut of the state pot taxes, and allow for an unlimited amount of state cultivation and retail licenses to be awarded. If approved, retail licenses could be awarded by as early as spring of 2019.