Hoping to keep up with larger states like California, the bill will only go into effect when the federal prohibition of marijuana ends.
America is one of the largest and most diverse countries in the world. Built predominantly on the backs (literally) and ingenuity of immigrants from all over the world, the U.S. economy is still, despite a significant erosion in the past couple of decades, one of the most robust and varied marketplaces globally.
From agricultural products to high-tech innovations, Americans are practically hard-wired to succeed and thrive in a fast-paced, highly competitive, and imaginative market-based playground of business.
One of the keys to that unparalleled success is the ability of American companies and consumers' ability to conduct business interstate. Being able to exchange goods and services across state lines freely is vital for the growth and expansion of the U.S. economy. However, one item that currently does not enjoy the benefits and financial rewards of that "borderless" transfer is cannabis.
While almost half the states (24) in the union have legalized adult-use marijuana sales, it is still illegal to conduct interstate commerce with cannabis products because of the continued federal ban on the popular and polarizing plant.
However, with the U.S. Drug Enforcement Agency (DEA) considering a proposal from the Department of Health and Human Services (HHS) to reschedule marijuana from a highly restricted Schedule I narcotic on the Controlled Substances Act (CSA) to a Schedule III drug, enabling better research opportunities for scientists and increased banking/financial options for legal marijuana businesses, the end to the ill-conceived federal prohibition on the plant is inevitable.
In preparation for that potentially seismic economic and cultural reversal in policy, several states have begun laying the groundwork for establishing a foundation for cannabis interstate commerce, particularly in the Western region of the country. One state that is entertaining legislation for its own marijuana interstate business infrastructure is Arizona.
Arizona lawmakers are looking to capitalize on cannabis as the legal and regulated industry continues to grow. Last week, according to multiple media outlets, state legislators introduced House Bill 2770, which would enable the state's marijuana companies to sell their products across state lines if and, more likely, when the federal ban is lifted.
"What this measure is trying to do is trying to get Arizona to that point to where they can be at the start line so that when the feds wave the flag, they can start competing and start selling immediately across state lines," said Arizona Rep. Justin Wilmeth, who chairs the House Commerce Committee and is the bill's sponsor.
"What this measure is trying to do is trying to get Arizona to that point to where they can be at the start line so that when the feds wave the flag, they can start competing and start selling immediately across state lines."
- Arizona Rep. Justin Wilmeth, the bill's sponsor
With states like Washington, Oregon, and California already passing similar pieces of legislation, also predicated on the end of prohibition, Rep. Wilmeth believes his bill is crucial if Arizona is to remain competitive with those much more prominent and better-established cannabis market sectors.
"So when the feds eventually, and the experts say within the next 3-5 years for sure, we will be able to have our business be able to compete immediately when this happens," Rep. Wilmeth said.
"So when the feds eventually, and the experts say within the next 3-5 years for sure, we will be able to have our business be able to compete immediately when this happens."
- Arizona Rep. Justin Wilmeth, the bill's sponsor
The new measure is receiving strong and understandable support from many cannabis business owners in the state. Raul Molina, who owns The Mint Cannabis dispensary, believes the proposed law could help provide some much-needed stability to an industry plagued with wild price fluctuations depending on a given market's maturity and stability.
"You have states like in Arizona, where it's a fairly low price, and then you have states that are newer into the market that haven't developed their cultivation industry yet, and they are much, much higher, at least two to three times the amount of price that we're we're paying in Arizona for wholesale flower. So, I think it'll stabilize the market," Molina said.
"You have states like in Arizona, where it's a fairly low price, and then you have states that are newer into the market that haven't developed their cultivation industry yet, and they are much, much higher, at least two to three times the amount of price that we're we're paying in Arizona for wholesale flower. So, I think it'll stabilize the market."
- Raul Molina, Owner of The Mint Cannabis dispensary
The bill's introduction has also been celebrated by the founder of the Arizona Marijuana Industry Trade Association, Demitri Downing, who praised the move by state lawmakers. He believes the measure could help transform Arizona from a predominantly consumption-based state to a central hub for cannabis production.
"Turning Arizona into a production state, rather than just a consumption state, is a wise and intelligent outlook on what's best for the state of Arizona jobs, economic development, taxes, and all the associated benefits of being able to produce and export something out of the state of Arizona," Downing said.
"Turning Arizona into a production state, rather than just a consumption state, is a wise and intelligent outlook on what's best for the state of Arizona jobs, economic development, taxes, and all the associated benefits of being able to produce and export something out of the state of Arizona."
- Demitri Downing, Founder of the Arizona Marijuana Industry Trade Association
The bill must still make the requisite rounds through the House's committee approval process. However, political insiders and stakeholders believe it should have very few obstacles on its way to a floor vote in the next couple of weeks. If it does pass, much of the West Coast cannabis corridor will be primed and ready for regional exchanges as soon as prohibition ends.