WASHINGTON (WDVM) — On Monday, DC Council Chairman Phil Mendelson introduced legislation to regulate the sale of recreational cannabis, empower local business owners and aid communities affected by the War on Drugs.
When cannabis was legalized in the District, Congress ruled that the DC Council could not tax or regulate its sale. Mendelson says that created a “Wild West situation” in which mom and pop shops are being swallowed up by big companies from out of state. In turn, the economic benefits are reaped elsewhere.
With the expectation that Congress lifts that prohibition, the Comprehensive Cannabis Legalization and Regulation Act would establish a Social Equity program that sets aside at least half of licenses for so-called Social Equity applicants: D.C. residents who have been convicted of cannabis-related offenses or have lived at least 10 years in “areas with high rates of poverty, unemployment, and arrests.”
“We want to incentivize the local guy, the small guy and the disadvantaged guy and in turn, there’s a greater chance that their success will recycle into the community through spin-off economic activity,” Mendelson said.
The act would set the tax rate of cannabis sales at 13 percent, which is higher than D.C.’s food and alcohol tax rates. “We do not want to incentivize a black market or a continuation of a black market,” Mendelson said. “This is not simply about our greed, rather this is about stepping in where voters have already said, ‘We want this legal,’ so we step in and we don’t want to tax our way out of the legal market.”
A Cannabis Equity and Opportunity Fund — funded by 30 percent of tax revenues from cannabis sales in the District — would provide financial assistance to those applicants. Mendelson says federal regulations make it difficult for startups to access capital if they plan on selling cannabis.
The act also addresses the effects the War on Drugs has had on the District’s residents. A Community Reinvestment Program Fund — funded by 50 percent of tax revenues from cannabis sales in the District — would award grants to D.C. organizations that assist in economic development, homeless prevention, youth development and civil legal aid. It would also launch a public education campaign on cannabis law, responsible use, and harm reduction.
Finally, the bill would address previous and future cannabis-related arrests and convictions. It would automatically expunge them and incentivize resentencing for people currently serving such sentences. It would also establish protections “for District residents who legally possess and consume cannabis pursuant to the Act so they do not lose benefits, employment, or access to other critical resources.”