The 2022 Oregon legislative session was huge for Oregon cannabis. It adjourned sine die on Friday, March 4. We’ve been writing about it all the while, and you can find previous coverage in the links at the bottom of this blog post. Today I’ll cover the four marquee pieces of new legislation and talk about two bills that failed.
HB 4016 – PASSED. Marijuana license moratoria
This is one of the most consequential pieces of Oregon cannabis legislation, ever. It can also be understood as evidence of regulatory capture by industry. This bill started as a proposal to re-instate a moratorium on marijuana producer licenses, but quickly morphed into a mortarium on all license types, along with a retroactive ban on virtually all OLCC marijuana license applications from January 2, 2022. Pretty amazing. You can read my full take on HB 4016, including the bill’s half-assed nod at social equity, here.
HB 1564 – PASSED. Local hemp license opt-out
They almost did it with hemp too. SB 1564 initially proposed a controversial, statewide moratorium on ODA hemp grower licenses. As passed, however, it merely allows county commissions to request that ODA deny hemp license applications if those counties declare a local state of emergency. Application denials may be retroactive to January 1, 2022. Expect to see Jackson and Josephine counties each to declare emergencies, to start. The deadline for all counties to do so in 2022 is a week from today, March 15. Let’s see where this one goes after that. A blanket ban on growing a federally legal crop would have been a mistake in any case.
HB 4061 – PASSED. Illegal grows and water preservation
This bill establishes new prohibitions and penalties of up to $25,000 for anyone providing or receiving water at an unregistered or unlicensed grow site. The core of the bill is uncontroversial; its passage was never in doubt. That said, we’ve heard a few complaints about the new water purchase requirements, and general griping re: the twelve months of recordkeeping obligations for water providers. It doesn’t strike me as terribly burdensome. This is also the only bill of the four listed here which does not “declare an emergency” and take effect on passage.
HB 4074 – PASSED. Human trafficking reporting
We have covered this issue in the Oregon cannabis context. HB 4074 gives law enforcement additional investigatory powers, and comes with a mandatory reporting requirement — to both law enforcement and OLCC — in the case of suspected trafficking. It retains the “good faith” reporting safe harbor we mentioned in our session preview. This bill also appropriates $6 million for communities to deal with the “humanitarian crisis” at illicit operations.
Like HB 4061, this is mostly a bad actor bill, although it also retains the ODA hemp re-testing provisions we covered previously, along with provisions: 1) allowing OLCC retailers to relocate without re-licensing, and 2) requiring testing lab employees to obtain a marijuana worker permit.
SB 1587 — FAILED. Hemp building liens and foreclosure
This was an interesting bill which, among other things, contained a provision allowing liens on industrial hemp buildings and properties used unlawfully. This creative idea that would have dropped another arrow in the quiver targeting unlawful grows, alongside HB 1564 and HB 4061. Ultimately SB 1587 failed because it created a “fiscal impact” which couldn’t be quickly resolved; and for that same reason the provision was unable to migrate into any bill above. Expect to see this concept proposed again next year.
SB 1506. FAILED. County marijuana sales tax increases
This was a wild one. The base bill would have allowed cities and counties to increase local marijuana sales taxes from 3% to 10%. It ultimately failed following letters from every industry person and their mom. However, a modified proposal nearly squeaked through. The re-draft would have applied only in counties that border states where marijuana is illegal—specifically (and only) Malheur County in Eastern Oregon. Malheur County is where Idaho goes shopping to get high. Democrats liked the bill as a means to recoup marijuana revenue lost to Measure 110; Republicans liked it as a disincentive for marijuana business expansion more generally. This isn’t the first time a 7% local tax increase has been proposed. You can expect to see this idea floated again next year, too.
For previous posts in the 2022 legislative session, check out the following:
- Oregon Cannabis 2022: Legislative Forecast and Report
- Update: Oregon Proposed Cannabis License Moratoria
- No New Cannabis Licenses: Oregon Pulls the Plug
Best of luck to all in this brave new Oregon cannabis world of 2022!