By Kevin Bogardus - 06/05/13 09:00 AM EDT
The marijuana lobby is trading buzz for a briefcase as it seeks legitimacy in Washington.
The National Cannabis Industry Association (NCIA) has coordinated its biggest ever lobby trip this week, according to organizers, with more than 30 members headed to Capitol Hill on Wednesday and Thursday.
With marijuana prohibitions falling across the country, advocates for the drug are making the case that they represent Mom-and-Pop shops that are trying to make an honest dollar.
“Legislators need to hear from people in this industry that this is a very real industry, we are operating successful businesses, and we are being hindered by these ridiculous rules that cut back on our business,” said Ean Seeb, co-owner of Denver Relief, a medical marijuana business. “We are looking for equal treatment, to be treated like any other business.”
The NCIA will be bringing in members from 10 states for the lobby visit, including business owners and lawyers. Many of them will be present at a press conference with members of Congress — a time-honored trade group tactic — where the group will push for allowing licensed marijuana companies to take business deductions from their federal taxes.
“Fundamentally, these businesses are licensed, regulated and are operating like every other small business in America, but the federal government is treating them like criminals,” said Betty Aldworth, the NCIA’s deputy director.
The group’s show of force is a sign that the lobbying around marijuana policy is changing. Rather than recreational users and consumers, lobbying efforts are increasingly being driven by industry, according to Allen St. Pierre, executive director for the National Organization for the Reform of Marijuana Laws (NORML).
“This is definitely a different epoch that we are moving into now with the commercial entities now beginning to surpass the lobbying from the more than 40-year effort by the nonprofits,” said St. Pierre, who has been with NORML in Washington for more than 23 years.
Reps. Earl BlumenauerEarl BlumenauerOvernight Finance: House GOP grills IRS chief on impeachment | Bipartisan anger over Iran payment | Fed holds rates steady but hints at coming hike Panel votes to extend nuclear power tax credit DEA decision against reclassifying marijuana ignores public opinion MORE (D-Ore.), Ed Perlmutter (D-Colo.) and Jared Polis (D-Colo.) are expected to attend the NCIA’s press conference.
Marijuana reform lobbyists are supporting legislation that Blumenauer plans to introduce this week that would remove the Section 280E tax code distinction for state-licensed marijuana businesses. That would allow the shops to deduct their business expenses from their federal taxes like everyone else, according to a Blumenauer spokesman.
The NCIA says that without those deductions, marijuana businesses can pay a tax rate two to three times higher than other small businesses’ tax rates.
Sean Luse, chief operating officer for Berkeley Patients Group, a medical marijuana business, will be among the advocates in Washington this week lobbying for the bill. Luse said his company could use the tax deduction.
“It just takes money away from our other programs, like our philanthropic giving, hiring more people and providing more benefits for our employees,” Luse said. “It speaks to the fact that we have some of the same perspectives and same needs as every other small-business owner in America.”
Legalizing marijuana has proven popular at the polls, with Colorado and Washington passing ballot initiatives in the last election to allow recreational use of the drug. Blumenauer and Polis have since introduced legislation that would tax and regulate marijuana like alcohol.
But as America grows more comfortable with marijuana use, the burgeoning industry is aiming small for now, asking for changes in the tax code and banking regulations.
“This first generation of commercial lobbyists are not going for wholesale legalization yet, but rather for small parochial concerns — just tiny tweaks to the tax code and so on — that affect their bottom line right now,” St. Pierre said.
Like other business owners, those involved with marijuana can complain to lawmakers about being hassled by the federal government. Luse said his company had to close one location after coming under pressure from Justice Department, leading to several employees losing their jobs.
With marijuana still illegal under federal law, federal authorities have moved to crack down on the cannabis business.
“Though it’s licensed by the state, because it’s against federal law, that property can be seized,” Luse said.
Marijuana policy reform has begun to pop up in bigger debates on Capitol Hill as well.
A Senate Finance Committee “options paper” on tax reform mentions instituting a tax on recreational marijuana use. In addition, Sen. Ron WydenRon WydenOvernight Healthcare: Watchdog says ObamaCare program made illegal payments Election-year politics: Senate Dems shun GOP vulnerables Overnight Tech: TV box plan faces crucial vote | Trump transition team to meet tech groups | Growing scrutiny of Yahoo security MORE (D-Ore.) has offered an amendment to the farm bill that would exclude industrial hemp from the Controlled Substances Act definition of “marijuana.”
Wyden expects to find out later this week whether his measure — which is also backed by Sen. Rand PaulRand PaulHow low is the bar for presidential candidates, anyway? Lawmaker seeks to investigate Obama's foreign tax compliance law Funding bill rejected as shutdown nears MORE (R-Ky.) and Senate Minority Leader Mitch
McConnell (R-Ky.), among others — will get a vote on the Senate floor, according to a spokesman.
Rep. Thomas Massie (R-Ky.) has offered similar legislation in the House, and it has garnered 40 co-sponsors so far.
“He plans to continue to gain co-sponsors and spread the word about the economic benefits, especially for places like Kentucky, of bringing industrial hemp farming back to the U.S.,” said Gary Howard, a spokesman for Massie.
Owners of marijuana businesses aren’t letting up, and said they plan to be an active lobbying force in Washington.
“These are people who are just like your next-door neighbor, your friends and relatives, and they are going to speak up for the survival of their businesses,” Seeb said. “It’s no doubt that cannabis can become the next big industry if left unhindered by government.”