Analysis: The 2021 OK legislative session is over. What happened to the weed bills?

Jun 01, 2021

State lawmaker Scott Fetgatter said something in a press release last week that caught my attention after the cannabis-infused Senate Bill 1033 managed to pass just as the 2021 Oklahoma legislative session was coming to a close:

“In 2018, we bought the ticket and took the ride when it came to medical marijuana in Oklahoma. There weren’t many regulations, and stakeholders on all sides of the issue have been looking for structure. This industry has blossomed over the past three years, and we have been working to make sure there are structures in place to regulate and help give guidance to those working within it.”

Buy the ticket, take the ride.

That was a favored expression of the late political journalist and noted substance enthusiast Hunter S. Thompson. An ex-girlfriend and I in Texas were once such superfans of Hunter Thompson that we got a little tipsy and had the expression tattooed on our forearms, which is what you see above.

She has the other half. Fortunately, we’re still pals, so I don’t have to go on one of those tattoo reality shows where they cover up your regret with something that may be only mildly less regrettable.

Hunter Thompson meant a few things by this expression. One was that if you accidentally take too many illicit substances on a given occasion, you may just have to ride it out.

He also meant that politics and public life are a wild carnival ride every minute of every day in a nation that seeks to maximize fairness and liberty to the greatest number of people possible.

Cannabis policy in Oklahoma is no exception to the carnival ride. And few people seem to know that better right now than Republican representatives Fetgatter of Okmulgee and Jon Echols of Oklahoma City.

They’ve emerged since 2018 when voters first passed State Question 788 as among the most active lawmakers in the Oklahoma statehouse on how, whether, and why to regulate medical cannabis here.

I can’t say their task is enviable. On the one hand, there’s a loudly buzzing fear across the state that international business interests -- namely Chinese -- are taking over Oklahoma through it’s porous weed regulations and enforcement.

On the other hand, sales of medical cannabis in the state since it began had topped $1.3 billion by earlier this year. More people reportedly work in Oklahoma cannabis now at an estimated 17,000 than there are construction workers in the state. Oklahoma cannabis is creating entrepreneurship opportunities for many people that never existed before in this state.

The endless carnival ride Hunter Thompson referred to shows itself in the final tally of Oklahoma weed bills. Eight proposed by Fetgatter himself never made it across the finish line.

But Fetgatter and Echols both had key wins at the final hours of the session with major implications for cannabis consumers and the industry in Oklahoma. The failed cannabis bills that didn’t make it into law are just as noteworthy where they could appear again next year or proposed loosening rules on cannabis consumers and the industry.

Let’s start with the biggest bills that did pass and what they contain.

Senate Bill 1033

Negotiations over what this bill should include went on so late into the session that it became the very last bill to pass before the entire session ended May 27. Senate Bill 1033 began the session seeking only to establish how close cannabis dispensaries could be to schools and to grandfather into the law businesses that existed before a nearby school was established.

By the time Fetgatter read it on the floor last week, it contained much more:

Allows the Oklahoma Medical Marijuana Authority to enter into agreements with other state agencies for enforcement and compliance purposes. As Fetgatter described it on the floor, SB 1033 would enable OMMA to join forces with the Oklahoma Bureau of Narcotics and Dangerous Drugs in order “to go shut down the nefarious, illegal activity in the [cannabis] industry in the state of Oklahoma.”
Allows for the Oklahoma Tax Commission to beef up the enforcement of cannabis tax collections by using a fee from gross tax proceeds. Fetgatter said this would enable the tax commission to “perform audits on marijuana businesses to make sure they're paying their taxes. In recent months, we had one business that was bragging on social media that they were not paying $300,000 a month in sales taxes.”
Allows for an unlimited number of cannabis waste-disposal licenses in the state.
Allows caregivers only to grow for up to five patients at one time. There was previously no limit on this number.
Establishes that the 1,000 feet a dispensary must be from a school is measured from the school door nearest to the front door of the dispensary. Operators are grandfathered where schools are built after the cannabis business was established.

Sen. Lonnie Paxton (R-Tuttle), a frequent critic of cannabis in the legislature, has worked in the past to expand the ability of local governments to regulate cannabis businesses. He grumbled about the final measurement standard contained in HB 1033, according to Fox 25 in Oklahoma City: “You can put a medical marijuana dispensary right next to that football field as long as it's a thousand feet away from the primary campus. I don't know who's in favor of this.”

House Bill 2646

By the close of the session, this omnibus bill had become among the most closely watched cannabis proposals, because of the numerous rule changes it sought. Several of the other weed bills asked for only one thing at a time. This bill took a beating as it made its way through conference committee between the House and Senate chambers. Changes were still flying at the close of the session.

Here’s what HB 2646 contained by the time it reached the governor’s desk:

Removes language that would have created a three-day temporary cannabis license for nonresidents of Oklahoma.
Permits dispensaries and cultivators to package and sell their own pre-rolled joints. May not be infused with kief or distillate or weigh over one gram.
Allows customer interaction at retail dispensaries only with cannabis samples that are not for sale where the product is otherwise not in a sealed or separate package. (This language changed from previously seeming to ban all bulk flower display in jars at dispensaries.)
Allows growers to separate cannabis for quality-and-safety testing in 15-pound batches, rather than 10. If the cannabis is destined for processing, rather than retail, it can be separated into batches of 50 pounds.
Removes language that would have allowed growers and processors who achieved validation of their production processes to sell certain products.
Specifies that cannabis possession without a patient license “shall constitute a misdemeanor offense not subject to imprisonment.”
Allows state regulators to issue emergency orders without notice or hearing where they suspect violations from cannabis businesses. Operators could be fined $10,000 per day if they continued conducting business or otherwise violated the emergency order while it was in effect.

House Bill 2904

Fetgatter had lost his own attempt at an omnibus bill stuffed with desired rule changes earlier in the session in the form of House Bill 2004. But he says now that some of the intent of that bill was salvaged here in House Bill 2904.

It directs OMMA to hire 60 new compliance-and-enforcement inspectors and to outfit them promptly with effective inspection tools. Said Fetgatter to Tulsa’s KJRH last week: “The presence of OMMA having boots on the ground in our counties is going to help tremendously.”

High-profile Oklahoma cannabis attorney Ron Durbin praised the passage of HB 2904 on social media in his characteristic all caps and exclamation points and said that newly hired personnel for OMMA would be good for everyone:

“This is absolutely HUGE for patients and businesses!!! We have long worried that the Department of Health was happy to sit by and let the program fail by allowing un-inspected and unscrupulous businesses to ruin our image across the state. So far, that has proven to be the case as the industry’s reputation has been tarnished, and patients have no faith in a lot of the medicine being sold. It has caused a ton of problems in the legislature because of the complaints from rural Oklahoma.”

Although Fetgatter’s own omnibus HB 2004 mentioned above did not survive, there was an attempted early provision in it that’s worth mentioning here. Fetgatter wanted to grant cannabis operators the right to choose which software and radio-frequency technology they used for complying with Oklahoma’s track-and-trace program.

State weed regulators last year hired the Florida company Metrc exclusively for implementing the seed-to-sale tracking program. The idea was that cannabis operators would then be required to utilize Metrc’s software and tags at their own expense and at the rates charged by Metrc.

OMMA and Metrc reportedly disliked Fetgatter’s idea of cannabis businesses being permitted to choose what they used for compliance, so he removed the language from HB 2004. Said Fetgatter at a February committee hearing about the matter:

“It’s my understanding that OMMA and Metrc are not really happy about the language in this bill, even though neither one of them has personally come to me and discussed that. So we are going to strike this language out, so we don’t shut down negotiations on this particular issue with the [radio-frequency] tags.”

Since that time, ironically, the state’s mandated seed-to-sale program and exclusive use of Metrc products have wound up at the heart of litigation between cannabis attorney Durbin, a group of cannabis operators as his plaintiffs, and state weed regulators who selected Metrc as the exclusive tracking-compliance vendor. The lawsuit is ongoing.

House Bill 2272

Like Senate Bill 1033, this bill looked dramatically different by the time it crossed the finish line. Rep. Josh West of Grove and Sen. Casey Murdock of Felt, both Republicans, had initially wanted to cap the number of cannabis business licenses handed out by state regulators with HB 2272.

West said his constituents asked for the bill after complaining about black-market and noncompliant cannabis operations in his district. The bill was controversial among cannabis reformers, however. Fetgatter and Echols worried in committee hearings that it would unfairly hamstring the cannabis industry and possibly run afoul of the Oklahoma Constitution.

By the time of HB 2272’s passage, the proposed cap on licenses was long gone owing to an earlier amendment. Instead, it now states that:

Cannabis businesses must reveal any foreign financial interests to state regulators.
Cannabis businesses shall be inspected for compliance within 180 days of licensure.
Licenses may be revoked where operators have not become operational quickly enough.

Here’s a tidy translation of HB 2272 from cannabis attorney Durbin on Facebook: “If you have been lax on compliance, if you are not getting the message already, now is the time to catch up!!!”

Despite the passage of this bill and others, Fetgatter nonetheless told KJRH he believed the state still wasn’t going far enough to regulate the cannabis industry: “We had some definite wins for the citizens of Oklahoma this session. But in my opinion, because I understand the business, we haven’t gone far enough. It's very frustrating for me at this point.”

This weed bill wasn’t the only one during the session that created a furor among cannabis reformers by what it initially sought. Cannabis critic Paxton of Tuttle had earlier proposed Senate Bill 445. It seemed to re-criminalize cannabis in Oklahoma by boosting criminal penalties where cannabis patients and businesses illegally diverted it to unauthorized people. The bill passed the Senate but ultimately died in the House.

House Bill 2674

Here’s yet another weed bill that took a wild turn at the final hour.

Echols had desperately wanted to ramp up enforcement of the state’s cannabis industry by creating an Oklahoma Department of Marijuana and Alcohol. It would have merged OMMA, currently contained within the Oklahoma State Department of Health, with the Oklahoma Alcoholic Beverage Laws Enforcement Commission.

But suddenly by last week, the language contained in the bill for making this merger happen had vanished. Instead, the bill at passage focused on rule changes for alternative tobacco products, i.e. tobacco vaping. In fact, the final bill didn’t contain the word “marijuana” at all. So OMMA stays at the health department for at least another year.

Echols described at an early May committee hearing what he was trying to achieve with this bill and the omnibus HB 2646 described above:

“We have unsafe [cannabis] product. We have product that is not being tested. We have product that is coming in from other states. We have products that are being grown in this state and sold out of state. It is ridiculous and absurd. … When we have people who are trying to play by the rules, and we are not doing enough to enforce those rules on everybody, it hurts the citizens and hurts the legitimate people who have put their personal fortunes on the line -- whatever they have, their equity. To not enforce those rules is just not fair.”

The graveyard of Fetgatter weed bills

Finally in our analysis, there are the numerous failed attempts made by Fetgatter in 2021 to aid cannabis consumers and the industry by loosening rules while still working to confront bad actors, which no one doubts exist aplenty. Said Fetgatter to KJRH: “The citizens of Oklahoma are not going to be satisfied with what we accomplish. We haven’t gone far enough to help legal businesses, and we haven’t gone far enough to shut down illegal businesses.”

Here are key Fetgatter proposals that bit the dust earlier in the session:

House Bill 2022 Authorizing two-year patient licenses for nonresidents of Oklahoma who do not have a card in their home state.
House Bill 1909 Permitting cannabis businesses to pay less in state taxes by allowing them to take more business deductions not currently allowed under federal tax rules.
House Bill 1960 Enabling dispensaries to deliver purchases to consumers located within 10 miles.
House Bill 1961 Presenting fully legal adult-cannabis use as a state ballot question to voters during the November 2022 election.
House Bill 2023 Authorizing cannabis business licenses to be transferred from one person to another for $500.

Here’s a chart of the final winners and losers of the 2021 Oklahoma weed bills.

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