The U.S. Virgin Islands (USVI) is set to become the next jurisdiction in the country to legalize marijuana, with a bill awaiting imminent action from the pro-reform governor. The sponsor wants to be clear, however, that the legislation is not meant to be an economic panacea for the territory, even if it might bolster tourism and help straighten up the existing medical cannabis program.
Sen. Janelle Sarauw (I) told Marijuana Moment in a phone interview on Tuesday that she hasn’t heard from the governor’s office about his intentions for her legalization bill that the legislature delivered to his desk late last month. But she said it would be “foolish” of Gov. Albert Bryan Jr. (D) “not to sign it,” especially given his repeated campaign pledges backing the reform in general even if he differs on specific provisions.
The relationship between the senator and governor as it relates to cannabis legalization has been tense, despite the fact that both support ending prohibition and creating a regulated market. Bryan publicly pressured Sarauw to file her bill as it was being finalized, and the senator has been critical of the governor’s own earlier reform proposal.
Sarauw said that it was imperative that the legislation wasn’t rushed, as she didn’t want to see a repeat of what she’s described as a poor rollout of the medical cannabis law that was enacted early in Bryan’s administration. Her legislation serves a dual purpose to that end: legalizing marijuana for adult use while substituting the medical cannabis law.
“I combined both of them so they can move parallel to each other,” she said. “The major difference in the recreational piece is that a recreational piece allows for a greater component around social equity in the territory.”
Ending prohibition is a major reform—but not one that she wants people to assume will resolve the territory’s economic issues. While Bryan has made much about the potential boost in tourism that he believes legalization can produce for USVI, for example, Sarauw wants to temper expectations, saying it will provide visitors with “another layer, an amenity” to enjoy, but not something that she expects will attract tourists on its own.
The governor hasn’t said whether he plans to sign the bill or not, but the legislature’s website says that it was delivered to him on January 9. He has ten days to sign, veto or allow the legislation to take effect without his signature.
As they worked to finalize the reform measure, a delegation of USVI lawmakers, including Sarauw, visited Colorado last year to learn about the state’s experience as one of the first to legalize recreational cannabis.
The senator said that she and her colleagues drew many lessons from the trip that helped inform their approach. They learned, for instance, the importance of establishing robust packaging and labeling requirements to prevent youth access and ensuring that the territory has the resources to enforce those regulations.
She also said that they heard “unequivocally” from officials that the governor’s ambitious revenue projections for legalization were “inflated,” and she wants to set the record straight that it will take years of implementation before USVI starts to see significant economic benefits from the program.
“There are a lot of takeaways,” she said. “What we’ve focused on in the government has been the good, the good, the good [of legalization].” But, “like anything else,” there are concerns that need to be addressed—”and we definitely have to learn from the mistakes of the states.”
She said that she does expect the territory’s legalization law, if the governor ultimately enacts it, will continue to be amended.
One unique part of the process to legalize cannabis in the territory concerns the role of the federal government. While the Justice Department has generally taken a hands-off approach to state-level cannabis markets, USVI is much more closely enmeshed with the federal government as a territory without its own constitution, Sarauw said.
“I’m hoping that the federal government does not interfere, but I honestly can’t say that they won’t because we already have a very heavy federal presence now,” she said. “This is also why I moved [to hold a Constitutional Convention] because we do need a constitution that will give us some level of political maturity.”
The introduction of the senator’s reform legislation came months after the governor included cannabis legalization revenue in a budget proposal that he sent to lawmakers and indicated that he might convene a special session to enact the policy change.
Here are some of the main provisions of Sarauw’s legalization bill:
Adults over the age of 21 could possess up to two ounces of marijuana, fourteen grams of cannabis concentres and one ounce of cannabis products such as edibles, ointments and tinctures.
The legislation would create an Office of Cannabis Regulation (OCR), tasked with issuing marijuana business licenses, overseeing the industry and setting rules on issues like advertising, packaging and labeling.
There would be several license and permit types, including for cannabis manufacturers, retailers, cultivators, micro-cultivators, testing laboratories and on-site consumption entities.
There would be caps on how many licenses OCR could grant for each of the territory’s main islands. Regulators could issue more after January 1, 2025 if they conduct a study demonstrating that the expansion is needed to meet consumer demand.
Individuals who use marijuana for sacramental purposes could apply for their own cultivation permits.
There would be a tax of no less than 18 percent on marijuana purchased from dispensaries, but that would not apply to medical cannabis. The bill also lays out licensing fees and calls for a 50 cent per gram tax on cannabis cultivators who sell marijuana to other licensees.
Revenue would be split among programs to address behavioral health, homelessness and youth recreation, as well as administration of the cannabis program and the territory’s general fund.
There would be a track-and-trace program for cannabis products.
There are also several equity components in the legalization bill, including prioritized application scoring for minority, women and service-injured entrepreneurs.
There would be a 100 milligram THC cap on edibles, and each serving could contain up to 10 milligrams.
Additionally, there are residency requirements for marijuana business ownership.
There are packaging and labeling restrictions, with the bill stipulating that labels must include health warnings and be designed in a way that doesn’t appeal to people under 21.
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The legislature separately approved complementary expungements legislation last month. It was amended ahead of passage and now provides for automatic relief from the courts for people with prior convictions involving up to two ounces of marijuana. As introduced, the legislation would have required people to petition the courts.
Bryan, who has also talked about marijuana as a safer alternative to opioids for pain treatment, stressed in May that it’s “been three years now moving” the issue, and so lawmakers need to “get it through the legislature so we can get some money going.”
He signed a medical cannabis legalization bill into law in 2019.
There was a hearing on the governor’s adult-use legalization proposal in 2020, with several government agencies testifying in favor of the reform and outlining how a regulated cannabis market could help the territory, especially given its economic needs.
Bryan has also emphasized the need to legalize, tax and regulate cannabis to generate revenue amid the economic downturn caused by the coronavirus pandemic.
If the governor signs the legalization bill, USVI wouldn’t be the first U.S. territory to enact the reform.
The governor of the Commonwealth of the Northern Mariana Islands (CNMI) signed a bill to end prohibition in 2018. The following year, the governor of Guam signed legalization into law.
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Photo courtesy of Brian Shamblen.
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