Capitol update: Winners and losers of the OK cannabis bills so far in 2021
*Last updated May 18, 2021
Lawmakers are in week 16 of the 2021 Oklahoma Legislative Session. The life and death of any proposed cannabis bills are ruled in part by key deadlines. Now that those deadlines are coming and going, it’s possible to make better determinations about what might actually become law.
During the first four weeks of the legislative session, committees are deciding by vote which bills will be sent on for a full-floor vote. If no vote is taken in committee, the bill is considered dead for the session.
If a bill survives committee, it has another two weeks during which a full vote must take place, or it, too, cannot proceed and is considered dead for the session. That deadline has now passed as well.
Bills in the first group below have cleared the House or Senate or both and are very much not dead, as far as I can tell. The next group of bills cleared some committees and votes but did not receive further action in time. The final list died in committee.
Welcome to legal cannabis in the great state of Oklahoma. Having fun yet?
Bills that are still active
Sponsors Rep. Jon Echols (R-Oklahoma City), Sen. Zack Taylor (R-Seminole)
Status Passed the House. Passed the Senate. Making its way through conference committees.
Summary This is a hefty bill seeking numerous cannabis rule changes that lawmakers have sought in the past but couldn’t address in time. I wrote in more detail about HB 2646 here. This bill has picked up two amendments in the late stages of the session that should get the attention of the cannabis industry in Oklahoma. One would appear to ban the display of bulk flower in jars at dispensaries. You would be permitted to show only samples. Another amendment would kill the last chance Oklahoma has in the current legislative session to create temporary licenses for non-residents of Oklahoma who don’t have corresponding medical cards in their home states. A conference committee twice considered this bill at hearings in early May. During one hearing, Rep. Echols said he believed as little as 40% of the cannabis in Oklahoma was being tested for safety and quality. He wants to beef up enforcement of the industry by creating an Oklahoma Department of Marijuana and Alcohol that merges the Oklahoma Medical Marijuana Authority with the Oklahoma Alcoholic Beverage Laws Enforcement Commission. You can read the latest complete list of proposed changes at the bill link above. Below are some of the most noteworthy provisions:
Allows dispensaries and growers to package and sell their own pre-rolled joints. Prohibits pre-rolls infused with kief or distillate and those weighing over one gram.
Grants state regulators three months instead of two weeks to review applications for dispensary licenses.
Tightens measurement standards for dispensary locations. They are prohibited currently within 1,000 feet of a public or private school. HB 2646 would set this measurement as between the nearest property line of the school to the nearest perimeter wall of the dispensary.
Removes a “good cause” provision that requires state regulators to have specific reasons for denying business-license applications, refusing to renew licenses, or disciplining licensees.
Creates a temporary three-day patient permit for non-residents of Oklahoma with no limit on the number of times a person can receive it. The permit would cost $75.
Disallows other methods of financial assurance as an alternative to liability insurance.
Establishes fines for cannabis businesses that submit “grossly inaccurate” required reports to the state of $5,000.00 on the first offense and $10,000 on the second.
Specifies that possession without a license “shall constitute a misdemeanor offense not subject to imprisonment.” This clashed with SB 445 below, which proposed enhancing criminal penalties for possession or diversion.
Allows state regulators to issue emergency orders without notice or hearing when 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 place.
Sponsors Sen. James Leewright (R-Bristow), Rep. Scott Fetgatter (R-Okmulgee)
Status Passed the Senate. Passed the House.
Summary Grants cannabis businesses a waiver if they opened within 1,000 feet of a public or private school before the state began restricting locations. The bill would determine this 1,000 feet as between the school door closest to the front door of the cannabis business. HB 2646 above would measure this 1,000 feet as between the two closest points of the property lines.
Sponsors Rep. Josh West (R-Grove), Sen. Casey Murdock (R-Felt)
Status Passed the House. Passed the Senate. Approved by the governor on May 18.
Summary This was a controversial bill that initially called for placing caps on the total number of licenses Oklahoma can issue for cultivators, processors, and dispensaries. Due to a major amendment approved in the Senate on March 30, all attempts to cap business licenses have now been entirely removed. The bill initially proposed a limit of where the numbers of these license categories stood on Sept. 1, 2021. It also sought to slowly reduce the number of overall cannabis business licenses available in the state by not reactivating those that had been surrendered, cancelled, or terminated. That language has now been replaced by an unrelated rule change. HB 2272 as it’s currently written would require that cannabis licensees disclose to the Oklahoma State Bureau of Narcotics and Dangerous Drugs Control any foreign financial interest within 60 days of application approval. The latest version of this bill now also calls for cannabis operators to verify that they’re actively operating or working toward it within six months of issuance or risk license termination.
Sponsors Rep. Jon Echols (R-Oklahoma City), Sen. Zack Taylor (R-Seminole)
Status Passed the House. Passed the Senate.
Summary Seeks to toughen scrutiny of the cannabis industry by shifting oversight of the Oklahoma Medical Marijuana Authority from one major state agency to another. HB 2674 would take OMMA out of its current parent agency, the Oklahoma State Department of Health, and place it within the Oklahoma Alcoholic Beverage Laws Enforcement Commission. This would mean moving over to Oklahoma ABLE the tasks of issuing cannabis licenses to patients and businesses, inspecting cultivators and processors, and imposing penalties for violations. I previously wrote about HB 2674 here. Echols has said that he didn’t expect this bill would be very popular with everyone in the state. But he’s complained of weak enforcement of state cannabis regulations under the current structure. Echols has said as many as 150 new field agents could be needed to enforce industry rules.
Sponsor Rep. Rick West (R-Heavener), Sen. Frank Simpson (R-Springer)
Status Passed the House. Passed the Senate. Approved by the governor on April 26.
Summary Prohibits the state from awarding loans and grants to cannabis-related proposals from a special Oklahoma program designed to promote interest in agriculture.
Bills that appear dead from lack of action
Sponsors Sen. Lonnie Paxton (R-Tuttle), Rep. David Hardin (R-Stilwell)
Status Passed the Senate; passed the House Alcohol, Tobacco, and Controlled Substances Committee. Rep. Hardin’s office confirmed on May 4 that this bill is dead for the session.
Summary This controversial bill appears to significantly enhance penalties in Oklahoma for possessing, using, or sharing cannabis where all parties do not have state-issued licenses. In addition to fines already permitted by law, violators could also face criminal charges under the Oklahoma Uniform Controlled Dangerous Substances Act. The bill proposal itself seems to specifically target “diversion” from already licensed patients and caregivers to unauthorized persons. However, a bill summary online says it would also apply to unauthorized possession. Hardin has said the intent of this bill was to punish black-market dealing of cannabis and not people sharing it within their homes. A new bill summary specifies that the bill is designed to punish cannabis licensees who have “diverted medical marijuana products to a person with the intent or knowledge that that person intended to engage in trafficking of the products.” The latest version still strikes “shall not be punished under a criminal statute” from the state’s medical marijuana laws, which would seem to re-criminalize cannabis in Oklahoma.
Sponsors Rep. Scott Fetgatter (R-Okmulgee), Sen. James Leewright (R-Bristow)
Status Passed the House; cleared second reading in the Senate. Has not been heard by a Senate committee. Fetgatter now tells the media he believes this bill is dead in the Senate.
Summary Authorizes cannabis business licenses to be transferred from one person to another. You would need to submit a license application and $500 fee but not have to pay the typical $2,500 for a new license.
Sponsors Rep. Scott Fetgatter (R-Okmulgee), Sen. James Leewright (R-Bristow)
Status Passed the House; cleared second reading in the Senate. Has not been heard by a Senate committee. Fetgatter now tells the media he believes this bill is dead in the Senate.
Summary Authorizes temporary patient licenses for nonresidents of Oklahoma who do not have a medical marijuana license in their home state. The license would be valid for two years and cost $200. As many people are starting to notice, this bill could be a game-changer for Oklahoma’s still-young cannabis industry. The market-analysis firm New Frontier Data pointed out last year in a special look at Oklahoma cannabis that cannatourism from the Dallas and Fort Worth areas alone could translate into a windfall for the Sooner State.
Sponsors Rep. Scott Fetgatter (R-Okmulgee), Sen. Cody Rogers (R-Tulsa)
Status Passed the House; cleared second reading in the Senate. Was not heard by a Senate committee. Fetgatter now tells the media he believes this bill is dead in the Senate.
Summary Contains several desired rule changes that match provisions in HB 2646 described above but with some notable differences. This bill would arguably have the most sweeping impact on the industry out of the numerous cannabis bills proposed during the 2021 session. Fetgatter has said HB 2004 is an effort to make several cannabis policy adjustments that were denied last year by a veto from the governor over whether to allow cannabis delivery to consumers. He’s said cannabis delivery was removed from this year’s bill in order to keep its dizzying number of other provisions moving. I wrote more in-depth previously about HB 2004 here. Some of the most important provisions are below and reflect floor amendments:
Makes it far easier and cheaper for cannabis businesses to designate employees as official transporters.
No longer mandates that cannabis businesses verify their sources of financing.
Authorizes penalties where a cannabis licensee refuses to give state inspectors reasonable access to his or her premises.
Allows the Oklahoma Medical Marijuana Authority 90 days, rather than two weeks, to review dispensary, grower, and processor applications. Also instructs state regulators at OMMA to begin preparing rules for out-of-state cannabis sales “within 30 days of it being federally legal to do so.”
Changes the ownership residency requirements for dispensaries, so that up to 49 percent of your company’s owners could be non-Oklahoma residents instead of the current 25 percent.
Deletes the requirement that 75 percent of surplus proceeds from the state’s 7-percent excise tax on cannabis be used solely for common education.
Increases the penalty for selling cannabis to unauthorized people from $1,000 to $5,000 on the first offense and $5,000 to $10,000 on the second offense.
Allows a temporary license lasting four months for people who are not residents of Oklahoma.
Unlike HB 2646, lawmakers in this bill do not attempt to determine the batch sizes of usable cannabis and cannabis products that must be set aside by cannabis businesses for testing quality. These rules would instead be determined by regulators at OMMA after consulting with the cannabis industry.
A floor amendment from Fetgatter in this bill would significantly stiffen penalties for “grossly inaccurate or fraudulent” reporting made by cannabis businesses to state regulators. The law would allow $5,000 in fines for a first-time error (currently $1,000) and $10,000 for any subsequent offense (currently $5,000).
A second floor amendment also from Fetgetter would absorb the provisions of two other bills into this one. The two are HB 1908 (on what agency should collect cannabis taxes) and HB 1909 (on what expenses Oklahoma cannabis businesses should be permitted to write off for tax purposes).
There’s a past provision of this bill that is now noticeably no longer present. Fetgatter had earlier attempted to give cannabis businesses the ability to choose what software and radio-frequency tags they preferred for complying with the state’s track-and-trace program.
State regulators had already hired the Florida-based company Metrc last year for exclusively maintaining the software and tags that cannabis businesses would then be required to use at their own cost. OMMA and Metrc reportedly disliked the idea of cannabis businesses being permitted to have this choice, so Fetgatter removed it.
Sponsors Rep. Scott Fetgatter (R-Okmulgee), Sen. Zack Taylor (R-Seminole)
Status Never received a floor vote. This proposal has since re-appeared as a floor amendment in Fetgatter’s HB 2004.
Summary Moves collection of the state’s 7-percent excise tax on cannabis from the state department of health to the Oklahoma Tax Commission. The commission would receive 1.5 percent of the gross proceeds for performing this work. Fetgatter says he has heard of cannabis businesses bragging about not paying what amounts to millions of dollars in sales taxes. The Oklahoma Tax Commission could investigate cannabis tax dodgers if the bill passes.
Sponsors Rep. Jon Echols (R-Oklahoma City), Sen. Zack Taylor (R-Seminole)
Status Never received a floor vote.
Summary This bill bears similarities to HB 2646 above. It permits cannabis patients to possess marijuana of any amount that can be home-harvested from six mature plants. Also allows for the possession of up to 72 ounces of a topical cannabis product. Permits caregivers who obtain and deliver medical marijuana on behalf of patients to create companies for such services. Authorizes the sale of tinctures and oils that can be used in vape pens and capsules for vaporizing. Would require dispensaries that compound such preparations to have food-handling licenses.
Sponsors Rep. Scott Fetgatter (R-Okmulgee), Sen. Zack Taylor (R-Seminole)
Status Never received a floor vote. This proposal has since re-appeared as a floor amendment in Fetgatter’s HB 2004.
Summary Permits cannabis businesses to pay less in taxes to the state by allowing them to deduct more of their business expenses currently not allowed by federal law. Ongoing federal prohibition means state-legal cannabis businesses pay more in taxes under section 280E of the Internal Revenue Code simply for being cannabis businesses. Unlike traditional businesses, you are unable to write off standard expenses in order to lower your federal tax costs. This bill would at least allow you to take standard business deductions when paying your state taxes.
Sponsors Rep. Stan May (R-Broken Arrow)
Status Never received a floor vote. This proposal has since re-appeared as a floor amendment in Fetgatter’s HB 2004.
Summary Removes the task of “performing firefighting duties” from the list of occupations in Oklahoma law deemed to be “safety-sensitive” that could be affected by the use of medical cannabis. May has said firefighters requested the bill, because they viewed it as unfair that law enforcers were not also on the safety-sensitive list.
Sponsor Sen. Nathan Dahm (R-Broken Arrow), Rep. Sean Roberts (R-Hominy)
Status Never received a floor vote.
Summary Makes it unlawful for people in Oklahoma who are under the influence of medical marijuana to carry or use firearms.
Bills that didn’t survive committee
Sponsors Rep. Scott Fetgatter (R-Okmulgee)
Status Died in committee.
Summary Enabling cannabis dispensaries in Oklahoma to deliver purchases to consumers located within 10 miles.
Sponsors Rep. Scott Fetgatter (R-Okmulgee)
Status Died in committee.
Summary Presenting fully legal adult-cannabis use as a state ballot question to voters during the November 2022 election.
Sponsors Rep. Kevin McDugle (R-Broken Arrow), Sen. Zack Taylor (R-Seminole)
Status Failed to pass the House.
Summary Classifying locations as zoned for agricultural use where cannabis is being cultivated or processed within unincorporated areas.
Sponsors Rep. Ross Ford (R-Broken Arrow)
Status Died in committee.
Summary Permitting cannabis dispensaries to install drive-thru lanes and windows.
Sponsors Rep. Kevin McDugle (R-Broken Arrow)
Status Died in committee. (Fetgatter’s HB 2004 contains a similar provision for temporary patient licenses.)
Summary Recognizing medical-cannabis licenses from people out-of-state who are visiting Oklahoma.
Status Died in committee.
Summary Establishing that being a cannabis patient cannot be grounds for revoking a person’s suspended criminal sentence where the individual is serving probation as an alternative to jail or prison in an unrelated case.
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