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Arkansas panel advises limit to pot lobbyists' pay

Firms can’t offer stakes in revenue, ownership, state Ethics Commission rules by Brian Fanney | June 24, 2017 at 4:30 a.m.

Medical marijuana lobbyists should not be paid with a share in a dispensary or cultivation facility that depends on a state application's success, according to an advisory opinion approved Friday by the Arkansas Ethics Commission.

Attorney Brandon Lacy of Jonesboro had requested the opinion. He represents a business that wants licenses from the Arkansas Medical Marijuana Commission to grow or sell medical marijuana, according to the opinion.

He asked two questions: Can a lobbyist agree to be compensated with a percentage of a medical marijuana business's revenue if it successfully gains a license? Can a lobbyist be compensated with ownership in the business regardless of whether it is licensed?

Drew Blankenship, a staff attorney for the Ethics Commission, authored the opinion. He referenced Arkansas Code Annotated 21-8-607, which bans contingency fees for lobbyists.

The law states in part that lobbyists may not "[c]ontract to receive or accept compensation that is dependent in any manner upon: (A) The success or failure of a legislative or administrative action; or (B) The outcome of any executive, legislative, or administrative action relating to the solicitation or securing of a procurement contract."

Blankenship wrote that Lacy's first question -- whether a lobbyist can be paid only if a license is granted -- "falls squarely within the prohibition."

The second question -- whether a lobbyist could be granted a stake in a medical marijuana company regardless of whether it receives a necessary license -- proved trickier.

"It's one thing to be engaged and taking your chances, but it's another thing if you have to have success," Commissioner Sybil Jordan Hampton said in an interview.

Commission discussion on the opinion spanned two meetings, with commissioners deciding that the situation described amounted to a contingency fee.

"You're going to get the shares or the ownership interest, but the value is dependent on whether the lobbyist's efforts are successful," Graham Sloan, director of the Arkansas Ethics Commission, said in an interview.

A medical marijuana business won't be able to grow or sell marijuana without a license.

"The way the prohibition is worded -- you can't accept compensation that is in any way contingent upon the outcome -- and the fact that the value could fluctuate so greatly depending on whether the license was obtained or not led the commission to conclude that the arrangement would be compensation-contingent," Sloan said. "It runs afoul of that statutory prohibition."

The commission approved the advisory opinion without dissent.

Lacy, who requested the opinion, could not be reached for comment Friday.

Voters approved the Arkansas Medical Marijuana Amendment during the November election.

Rules to govern licenses, enforcement and medical cards for patients were given final approval by lawmakers earlier this month. Applications for growers and sellers opened Monday and are due Sept. 18.

Officials expect medical marijuana sales to begin next year.

Metro on 06/24/2017

Print Headline: Panel advises limit to pot lobbyists' pay

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