CHARLESTON — The House of Delegates passed a bill Friday that aims to patch up a financial hole in the state’s medical marijuana program, which is set to launch this summer.
The legislation (HB 2538) fills a void left when vendors informed the state treasurer’s office last year of their unwillingness to process fees, penalties and taxes associated with the program. The bill passed Friday would allow the state to bid out banking contracts to institutions like credit unions to allow them to process the funds.
“Currently, none of our financial institutions are allowed or are willing to move forward with collecting deposits as it relates to serving the medical cannabis and the bill requirements before it,” said House Banking and Insurance Chairman Eric Nelson, R-Kanawha.
The bill passed 89-7 without discussion and only Republicans in opposition. It now goes to the Senate.
A sponsor of the bill and supporter of the state’s medical cannabis program since its inception, Delegate Mike Pushkin, D-Kanawha, said in committee that the legislation is a limited-government approach to regulating the substance.
Currently, marijuana is illegal under federal law, although the federal government provides for a number of “safe harbors” for the drug, according to an advisory opinion from the state attorney general, and has not prosecuted businesses in the more than 30 states with similar programs.
“This is a small-government, free-market approach to it,” Pushkin said. “It’s simply allowing more folks to bid on it and see who would step up, and whose board of directors (would) accept a risk that hasn’t really been a risk in any other state, because there hasn’t been a single prosecution.”
The bill also offers legal protections for state employees who work to process program funds. This was added in committee as a shield against the U.S. Attorney for the Southern District of West Virginia, Mike Stuart, a vocal critic of the program.
Delegate Matt Rohrbach, R-Cabell, a physician, voted against the bill. He declined to comment after the floor session. Delegates Tom Fast, R-Fayette, and Ray Hollen, R-Wirt, both spoke out against the bill when it was in Judiciary Committee, but stayed mum on the House floor.
In committee, Fast criticized the bill, saying it’s just a workaround of federal law.
“It seems to be very clear that this is simply a mechanism to get around federal law and it doesn’t appear that it is successful,” he said.
Both Senate President Mitch Carmichael, R-Jackson, and Gov. Jim Justice have expressed support for the banking fix.
The banking fix is one of several pieces of marijuana legislation introduced in the Capitol this year, although it’s the only one that has shown signs of progress.
Pushkin introduced another bill to remove language in code that prevents vertical integration in the industry – meaning businesses could act as any combination of growers, processors and dispensaries, making the industry more lucrative. No committee has taken up the bill yet.
Likewise, several House Democrats introduced a bill to legalize marijuana for recreational use in the state. That bill has received reference to three separate committees in the House alone, which is a few steps shy of a death sentence for a bill.