After nearly defeating their own legalization efforts due to a lack of communication, the Montana House of Representatives approved all three bills surrounding cannabis legalization. These legalization bills come in response to voter approved I-190. This measure received 54 percent of votes in the last general election. And it created an adult-use cannabis legalization structure for the whole state. However, things are changing between I-190 and the House bills, and not all are for the better.
Approved Bills
Last week, Montana House members nearly defeated their own reform measures because of miscommunication. Now, all three bills are moving forward. Those include HB 701, the most comprehensive and popular of the three bills, HB 670, a similar bill to HB 701, and HB 707.
HB 701 would place a 20 percent sales tax on all legal sales. A majority of the funding would go to the state’s general fund and a small portion of it would go to a substance abuse prevention program that’s backed by Governor Gianforte (R). This measure received 59-41 in a final vote. Many Democrats and hardline Republicans voted against the bill because of its huge restrictions placed on legalization and how far it deviated from the original I-190 measure.
HB 670, comparable to HB 701, placed a lower sales tax of 15 percent on all legal sales. ⅔ of tax revenue would cover public employee pensions and the other third would go to a trust fund to address negative side effects of cannabis use. This bill’s sponsor, Rep. Derek Skees, wants to ensure that the government doesn’t grow as a result of recreational cannabis. Plus the decreased sales tax would make cannabis competitive with the black market sales, encouraging people to purchase cannabis legally.
HB 707 is completely different from the previous two bills. It would place a 20 percent tax on the wholesale price of cannabis. Wholesale is typically half the price of retail, so the tax basically becomes a 10 percent tax. This reduces revenue overall and what revenue is collected is directed to the state’s general fund. Both HB 670 and HB 707 received 67-33 votes that fell along party lines.
Public Outcry
With the changes happening, activists who initially fought to get I-190 on the ballot are calling each bill a hoghouse. Meaning that what the bill, in this case, I-190, was originally created for is no longer the focal point or purpose of the bill now.
Under I-190, recreational sales would begin in January 2022. Plus, a good portion of tax revenue from sales would go towards conservation efforts. None of the current bills being passed from the HOuse to the Senate address any of these concerns, especially conservation efforts.
It’s unclear how the Senate will react to these three House bills now in their hands for discussion. Many are urging for them to be dropped so I-190 can move ahead as written. Whether or not the Senate agrees with activists remains to be seen.
As more news develops, we will be sure to update you with the latest. Make sure to check back for more cannabis and hemp related news.