On Monday, Nancy Mace (Republican U.S. Senator from South Carolina) unveiled a bill that would tax and regulate marijuana. This new pathway will allow for federal policy reform. The States Reform Act (or marijuana decriminalization at the federal level) would allow states to establish their cannabis regulations.

Mace pointed out that legal cannabis is only available in three states at this time, during a Monday afternoon press conference held at Capitol.

“My home state of South Carolina permits CBD, Florida allows medical marijuana, California and others have full recreational use, for example. Each state is unique. Every state is unique. Cannabis reform at federal level should take this into consideration. And it’s past time federal law codifies this reality,” Mace said in written comments prepared for the event. “This is why I’m introducing the States Reform Act, a bill which seeks to remove cannabis from Schedule I in a manner consistent with the rights of states to determine what level of cannabis reform each state already has, or not.”

Mace, appearing with a contingent of stakeholders, veterans, and law enforcement officers, noted that public opinion polls show that a supermajority of Americans are in favor of reforming the nation’s cannabis laws. Her bill will support farmers, business owners, law enforcement and patients who use medical marijuana, while supporting criminal justice reform.

Bill lets states decide on legalization

Under Mace’s bill, cannabis would be removed from Schedule I of the Controlled Substances Act, and the states would be allowed to take the lead on marijuana legalization and regulation for their jurisdictions. Federally, marijuana would be controlled in the same way as alcohol. The U.S. Department of Agriculture would oversee the regulation of growers, and the Food and Drug Administration would supervise medical use. 

In accordance with the bill, cannabis products will be regulated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and Alcohol and Tobacco Tax and Trade Bureau. States Reform Act also imposes a 3 percent excise tax federally on cannabis products. Revenue raised will go to law enforcement, small-business funding, veterans mental health initiatives, and revenue earmarked for other purposes.

Mace’s bill also ensures safe harbor for state medical marijuana programs and patient access to medicinal cannabis. This legislation protects medical marijuana as a treatment of arthritis, cancer and chronic pain. It also covers HIV/AIDS, post traumatic stress disorder, HIV/AIDS, and sickle cell disease.

The bill’s justice reform provisions include the release and exoneration of cannabis-related federal convictions. The bill does not provide relief for cartel agents and cartel members. Mace’s office estimated that approximately 2,600 federal prisoners would be released if the legislation is signed into law.

Alternative to Democrats’ Legalization Plan

Mace’s bill serves as an alternative to Democrats’ plans to legalize cannabis at the federal level, including a proposal unveiled by Senate Majority Leader Chuck Schumer of New York in July. His bill, the Cannabis Administration and Opportunity Act (or Mace’s), would tax marijuana at 25.5 percent. Proceeds from sales of cannabis could be used to fund broad programs for social equity and economic growth. 

Graham Farrar, the president and co-founder of California vertically integrated cannabis company Glass House Brands, characterized the new legalization proposal as “exciting stuff,” adding the legislation “just removed the question on whether this is a bipartisan issue or not.” Farrar said Mace’s bill could also spur support for the Secure and Fair Enforcement (SAFE) Banking Act and predicted the chances that Congress would pass cannabis banking legislation this year have increased substantially.

“If the Republicans and the Democrats want to get in a pissing match on who can legalize better, I’m all for it! I think the move significantly ups the odds across the board,” he wrote in an electronic message.

Nick Kovacevich, CEO of cannabis accessories distributor Greenlane Holdings, noted that “the current Democratic leadership is eager to legalize cannabis, but the fear is that they won’t be able to find a path through Republican resistance.”

“The fact that a Republican is dropping a legalization bill is very encouraging because it will display a middle ground toward accomplishing this ever-important goal—the legalization of cannabis,” Kovacevich wrote in an email. “Furthermore, this is a smart move by the GOP since they are gaining momentum into the midterms and cannabis is such a popular issue with the voters. If successful with cannabis legalization, it could result in broad election success come a year from now.”