Issue 6 legalizes, sets rules on medical 'pot'

It calls for state registry cards, inspections, licensing of dispensers, growers

A proposed constitutional amendment to legalize medical marijuana would do so by authorizing a web of state agencies to regulate aspects of the cultivation, distribution, medical use and taxation of the drug.

Issue 6, the Arkansas Medical Marijuana Amendment, was one of two ballot proposals to allow people to be treated with marijuana for medical problems ranging from intractable pain to cancer.

The proposal known as Issue 7, or the Arkansas Medical Cannabis Act, was struck down by the Arkansas Supreme Court last month over a challenge to the petitioning process. Because the court decision came after early voting began, both marijuana issues appear on ballots, but only votes for Issue 6 will be counted.

Both medical marijuana proposals have contingents of opponents who balk at the notion that smoking "pot" is sound medicine.

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A previous attempt to legalize medical marijuana in Arkansas failed narrowly in 2012, with 51 percent voting against legalization.

David Couch, who split from the supporters of the 2012 proposal to draft Issue 6, said he feels confident that those who favor medical use of marijuana will rally around the amendment Tuesday, Election Day.

"I think [the Supreme Court decision] benefits us in multiple ways," Couch said. "When there are two measures on the ballot that do the same thing, there is some confusion as to which does which."

Couch split with the group Arkansans for Compassionate Care, the backers of Issue 7, over the proposed initiated act's "grow-your-own" provision. Under "grow your own," patients living in rural communities more than 20 miles from a dispensary would have been allowed to grow up to 10 marijuana plants. Couch's amendment doesn't include that provision.

The Arkansas Medical Marijuana Amendment would allow patients, under the direction of their doctors, to possess 2.5 ounces of "usable marijuana."

If enacted, the amendment would go into effect Jan. 1. However, that doesn't mean that patients could get medical marijuana that day. The state will require months to set up rules and start issuing licenses for cultivators and dispensaries.

Three agencies

The regulating agencies listed in Issue 6 are:

• The Department of Health, which would be in charge of issuing registry identification cards for patients that have any of 18 qualifying conditions as defined in the amendment. The Department of Health also could approve other conditions for marijuana treatment.

The department would have to adopt rules 120 days after the amendment takes effect Jan. 1.

Those rules would govern such things as how the department considers applications and renewals, labeling and testing standards, and any other matters necessary for the department's "fair, impartial, stringent, and comprehensive administration of this amendment."

The department cannot issue a registry card to someone under 18 years old unless the patient's physician has explained the potential risks and benefits of the medical use of marijuana, and a parent or guardian consents in writing and registers with the department.

The registry of users and caregivers must be confidential, according to the amendment.

• The Arkansas Alcoholic Beverage Control agency of the Department of Finance and Administration would inspect the dispensaries and cultivation facilities.

The division must adopt rules governing oversight requirements, record-keeping, security, personnel requirements, and the manufacturing, processing, packaging and dispensing of medical marijuana.

• A Medical Marijuana Commission that would be created. The commission would consist of five members -- two appointed by the Senate president pro tempore, two appointed by the House speaker and appointed one by the governor.

The commission would administer and regulate the licensing of dispensaries and cultivation facilities. It would allow at least 20 but not more than 40 dispensary licenses, and at least four but not more than eight cultivation facility licenses. The commission would begin accepting applications by June 1.

The commission would set initial maximum application fees for dispensaries and cultivation facilities, establish qualifications for registry identification cards and establish standards to ensure that qualifying patient registration information is treated as confidential, among other duties.

Those submitting applications for licenses to run dispensaries or cultivation facilities must be current residents who have lived in Arkansas for at least seven consecutive years. Sixty percent of the individuals owning an interest in a facility must also meet the residency requirement.

Future changes

With two exceptions, the amendment would give the Legislature broad authority to change any aspect of the law by a two-thirds vote. However, the Legislature would not be able to remove the legalization of marijuana, or limit the number of dispensaries and cultivators.

The numbers are nearly there for lawmakers to make sweeping revisions. Last month, 84 lawmakers -- six shy of two-thirds of the total 135 seats -- announced their opposition to medical marijuana.

But if the amendment passes by a popular vote, Couch said he isn't concerned that the Legislature will try to counteract with changes, such as setting burdensome annual fees for dispensaries, to try to cripple the medical marijuana system.

"I think a lot of people in the General Assembly support this, but politically you can't," Couch said, predicting that that will change if voters approve the measure.

House Speaker Jeremy Gillam, R-Judsonia, said through a spokesman that he's had no discussions about possible legislative changes to the proposed amendment.

Senate President Pro Tempore Jonathan Dismang, R-Searcy, said he hasn't discussed possible changes to the amendment either.

"I have not considered whether to ask the Legislature to change any provisions of the Medical Marijuana Amendment. At this point, we are concentrating on making sure Arkansas voters are informed about the serious unintended consequences passage of Issue 6 would have on our state," Gov. Asa Hutchinson said in a statement. "In the event the Medical Marijuana Amendment does pass, we will evaluate any potential changes at that time."

Budget impact

Proponents and state officials have disagreed on the impact the amendment would have on the state budget. Estimating that between 30,000 and 90,000 Arkansans would qualify for registry cards, Couch predicted the annual revenue from the state's 6.5 percent sales tax would total $8 million to $10 million annually.

No special sales tax on medical marijuana is included in the amendment. However, regular sales tax collections from medical marijuana would be earmarked toward seven state programs and funds. Half of the tax dollars would go to the Vocational and Technical Training Special Revenue Fund, 30 percent would go to the state's general revenue fund and 10 percent would go to the Skills and Development Fund.

The remaining 10 percent would go to the agencies responsible for regulating the medical marijuana -- 5 percent to the Health Department, and 2 percent each to the Alcoholic Beverage Control Administration and Enforcement divisions, and 1 percent to the Medical Marijuana Commission.

Couch said the amendment is set up to be revenue-neutral.

"[Lawmakers] have the ability to add taxes if they need to but the need is not there," Couch said.

Hutchinson, a former administrator of the federal Drug Enforcement Administration, has been vocally opposed to medical marijuana and has said legalization would be a drain on state resources.

The Health Department, whose officials oppose medical marijuana as a public health issue, would need an appropriation from the Legislature and an exemption from the ongoing state hiring freeze to begin setting up a regulatory framework before taxes and fees can be collected, said Ann Purvis, the department's deputy director for administration.

Purvis estimated that those costs could reach $2.3 million during the startup process and range annually from $750,000 to $1 million. The rollout also would be subject to state bidding requirements, Purvis said, which could take up to six months for a project such as building a registry database.

"It is a significant impact in that currently we have no staffing or funding to start this process," Purvis said. "We're not sure we can make it through the rules-making process in 120 days."

Jerry Cox, the president of the Family Council, has participated in lobbying efforts against both medical marijuana proposals as part of a coalition of opposed groups called Arkansans Against Legalized Marijuana. The group has held numerous news conferences at the state Capitol featuring physicians who dispute the medicinal benefits of marijuana and opponents from states such as Colorado, where marijuana has been legalized for recreational use.

Cox said commercials run by groups in support of legalized medical marijuana -- which often feature families touting the drug as a cure for their loved ones' illnesses -- are misleading to voters.

"Issue 6 is a business monopoly model where only eight people get to grow it and no more than 40 get to sell it," Cox said. "They think, 'I'll vote for Issue 6 because I like that story,' and I keep telling people, 'You're not voting on a story, you're voting on an 11,000-word ballot measure."

Addressing continued attempts to legalize medical marijuana, Rep. Dan Douglas, R-Bentonville, said during a recent news conference hosted by Arkansans Against Legalized Marijuana that he would introduce a bill to legalize smokeless cannabidiol to help patients with seizures and epilepsy. Douglas said he hoped that permitting the use of some aspects of cannabis would draw support away from the legalization movement.

Couch said he doubted that the Legislature would follow through with Douglas' proposal if Issue 6 fails. He said Douglas' plan is meant to undermine popular support for medical marijuana.

"By virtue of them wanting to introduce it in the next general session, they acknowledge that marijuana can be medicine," Couch said. "It's too late, too many people are suffering, it's time to do it now."

Couch's group recently began airing three new television commercials touting Issue 6 as the only way to legalize medical marijuana this election. Couch said the statewide ad buy costs about $250,000. Opponents spent $142,535 on TV ads in October, according to filings with the state Ethics Commission.

Arkansans United for Medical Marijuana, which paid for the soliciting of signatures for Couch's amendment and the subsequent campaign, reported spending a total of $885,016 through October. Arkansans Against Legalized Marijuana has spent $154,049.

Marijuana is legal for medical purposes in 25 states, and four states and the District of Columbia allow its recreational use, according to the National Conference of State Legislatures. A federal prohibition on the drug is still in place, but in 2013 the U.S. Department of Justice said it would not interfere with state legalization laws.

In addition to Arkansas, voters in Florida, North Dakota and Montana will decide medical marijuana proposals in this election. Another five states have elections on recreational marijuana.

Information for this article was contributed by Michael R. Wickline of the Arkansas Democrat-Gazette.

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