HB1 and HB2 – Marijuana Legalization and Regulation

Legislation that would make Delaware the latest state to legalize and regulate recreational marijuana for adult users was filed late last week.

Collectively, Rep. Ed Osienski’s House Bills 1 and 2 comprise the Delaware Marijuana Control Act, with HB 1 legalizing possession of small amounts of marijuana for personal use, and HB 2 regulating the legal industry of growing and selling cannabis.

House Bill 1 would remove all penalties for possession of a personal use quantity of marijuana, except for those who are under 21 years of age. Possession of more than a personal use quantity of marijuana and public consumption would remain unclassified misdemeanors. A personal use quantity would be defined as one ounce or less of leaf marijuana, 12 grams or less of concentrated cannabis, or cannabis products containing 750 milligrams or less of delta-9-tetrahydrocannabinol.

Because this bill does not have any taxation or revenue aspect to it, the measure would only require a simple majority, or 21 votes in the House. 

House Bill 1 – Legalization of Recreational Marijuana	Currrent Status – House Health & Human Development 1/20/23
House Sponsors – Osienski, Longhurst, Baumbach, Morrisn, Heffernan, Chukwuocha, Cooke, Dorsey Waler, Griffith, Johnson, Lambert, Lynn, Minor-Brown, Moore, Neal, Phillips, Romer, Williams, Wilson-Anton	Senate Sponsors – Paradee, Hoffner, Gay, Huxtable, Lockman, McBride, Sokola, Sturgeon, Townsend, Walsh
House Yes Votes –	Senate Yes Votes –
House No Votes –	Senate No Votes –
House Absents or Not Voting –	Senate Absent or Not Voting –

House Bill 2 would create a legal framework to regulate the cultivation, sale and possession of marijuana, provide opportunities for small businesses to be licensed, and ensure people disproportionately affected by the prohibition of marijuana have access to this new market. The legislation also contains a new framework for directing some of the state proceeds from sales and licensing to justice reform efforts.

HB 2 would regulate and tax marijuana in the same manner as alcohol. It would allow adults 21 and older to purchase a personal use quantity of marijuana from a licensed retail marijuana store.

Under the bill, the Division of Alcohol and Tobacco Enforcement (DATE) would absorb marijuana enforcement and create a separate, administrative Office of Marijuana Control Commissioner within the Department of Safety and Homeland Security. 

The legislation would allow for up to 30 retail licenses to be issued within 16 months of the bill’s effective date. It also would establish a competitive licensing process through the Office of Marijuana Control Commissioner using a scoring system that rewards applicants for paying a living wage, providing employer-paid health insurance, providing sick and paid leave to workers, hiring more full-time workers, focusing on diversity of workforce, and other factors. 

HB 2 would establish a marijuana control enforcement fee assessed at point of sale, set at 15%. 

Because this bill addresses revenue and taxation, it would require a 3/5 vote in each chamber (25 in the House). 

Both bills will be heard in House committees this week. HB 2 has been assigned to the House Revenue & Finance Committee and will be heard on Tuesday at noon. HB 1 has been assigned to the House Health & Human Development Committee and will be heard on Wednesday at 11 a.m. 

House Bill 2 – Marijauna Regulation (Delaware Marijuana Control Act)	Currrent Status – House Revenue & Finance 1/20/23
House Sponsors – Osienski, Longhurst, Baumbach, Dorsey Walker, Heffernan, Lynn, Minor-Brown, Morrison, Chukwuocha, Griffith, Johnson, Lambert, Moore, Neal, Phillips, Romer, Williams, Wilson-Anton	Senate Sponsors – Paradee, Hoffner, Lockman, McBride, Pinkney, Sturgeon, Townsend, Gay, Huxtable, Poore, Sokola, Walsh
House Yes Votes –	Senate Yes Votes –
House No Votes –	Senate No Votes –
House Absents or Not Voting –	Senate Absent or Not Voting –

Rep. Osienski: “Delaware has been missing an opportunity to participate in the adult recreational marijuana market. We’ve missed out on hurting the illegal market, creating a new industry with good-paying jobs, and bringing tax revenue into our state that is currently going to nearby states like New Jersey. We have spent the past several years educating members about the merits of this program and dispelling the misconceptions that have persisted. I’m optimistic that we have the support to make this effort a reality.” 

Sen. Trey Paradee: “Every year we don’t pass these bills, Delaware misses out on millions in revenue. From both an economic and a criminal justice perspective, legalizing and regulating the sale of marijuana is the right thing to do. I will continue to serve as the lead Senate sponsor on these bills for as long as it takes to for them to become law.” 

The measure would direct 7% of the marijuana fee revenue to a Justice Reinvestment Fund. The proposed fund would be administered by the Department of Justice and would be used to facilitate grants, contracts, services, or initiatives that focus on the following:  1) Restorative justice, jail diversion, workforce development, industry-specific technical assistance or mentoring services for economically disadvantaged persons in disproportionately impacted areas; 2) Addressing the underlying causes of crime, reducing drug-related arrests, and reducing the prison population in this state; and 3) Creating or developing technology to assist with the restoration of civil rights and expungement of criminal records. 

HB 2 would create new license pools for Social Equity and Microbusiness applicants. These applicants would have access to technical assistance programs, reduced fees, an adjusted points scale, and a waiver of the physical location requirement.  The new Microbusiness Applicant pool would be limited to applicants with majority ownership held by Delaware residents. These applicants would have reduced fees, though higher than Social Equity applicants, and an adjusted points scale. These applicants would have access to Cultivation and Product Manufacturing Licenses.  

The bill allows municipalities to prohibit the operation of marijuana facilities within their borders through local ordinances that are not in conflict with municipal regulations enacted under this law. 

Last year, similar bills passed the General Assembly finally after many years of trying, only to have the bill be vetoed by a Governor stuck in the 1980’s.

Governor Carney: I recognize the positive effect marijuana can have for people with certain health conditions, and for that reason, I continue to support the medical marijuana industry in Delaware. I supported decriminalization of marijuana because I agree that individuals should not be imprisoned solely for the possession and private use of a small amount of marijuana — and today, thanks to Delaware’s decriminalization law, they are not.

That said, I do not believe that promoting or expanding the use of recreational marijuana is in the best interests of the state of Delaware, especially our young people. Questions about the long-term health and economic impacts of recreational marijuana use, as well as serious law enforcement concerns, remain unresolved.

An attempt to override the veto in the House failed. Twenty-nine of the General Assembly’s 41 Democratic lawmakers have signed the bill as prime sponsors or co-sponsors. No House or Senate Republicans have thus far sponsored the measure.