Recreational pot bill headed to governor

After a whirlwind 24 hours that saw the fate of the bill change dramatically on more than one occasion, the Montana Legislature has passed House Bill 701, landmark legislation that implements the recreational marijuana program that voters approved last year.

The state House on Tuesday morning passed the bill as amended by the Senate on third reading 67-32, sending it to the governor’s desk. Retail sales of recreational marijuana are slated to begin in January of next year.

The bill, one of several visions this session for implementation of I-190, the initiative that created the recreational pot market in Montana, has traveled a bumpy road to the finish line. Since its introduction around a month ago (at roughly 160 pages long), the plan has faced dozens of amendments in both chambers and more than one vote to stop it in its tracks.

“Everything in the Legislature is a constant conversation, and we needed to make the point really clear: Given our timelines, sending 701 to a conference committee, even though well-intentioned, is for all intents and purposes is, if not killing it outright, getting as close as you can to killing it without actually killing it,” Rep. Mike Hopkins, R-Missoula, the bill’s sponsor, told reporters Tuesday. “So, I think the point needed to be clear that folks had a choice in front of them.”

On Monday, a contingent of House Republicans joined together to vote down the version of the bill that the Senate produced following extensive negotiations in that upper chamber. That amended language had wide-reaching effects on the program and the allocation of marijuana tax revenues — additional funds would go to conservation easements, reminiscent of the language in I-190; there’d be a special drug court for expungement cases, home grow would be allowed and more. The bill as written currently would also finance the HEART Fund, a substance abuse prevention program proposed by Gov. Greg Gianforte.

But House Republicans felt the Senate’s work didn’t reflect the changes they wanted to see — namely, lowering the 20% tax on recreational pot sales, eliminating the option for a local option excise tax, banning home grow and so on — and voted down the bill, intending to send it to a conference committee where the two chambers could reconcile their differences.

However, a conference committee risked running up against the intended end of the session later this week, and Hopkins said he felt like he didn’t adequately explain the stakes to his colleagues. He made a successful motion to reconsider the vote, and on Tuesday, many of the same lawmakers who voted not to concur with the Senate’s work voted to do the opposite. After lawmakers had a lengthy discussion on the tax rates in the bill, they suspended House rules in order to fast-track passage of a variety of outstanding policy priorities and passed HB701.

Some were still opposed. Rep. Bill Mercer, R-Billings, repeated his argument that the state would be committing millions in projected revenues from the recreational marijuana program without knowing exactly how much money they’d have to spend. What could possibly drive medical marijuana cardholders — who would pay just a 4% tax under the bill — to pay for recreational pot at a 20% rate, he asked.

“I don’t think there’s any way we’re going to see the revenue materialize in 2023 that’s been forecast,” he said. “We are creating new spending that is completely unrelated to the tax that is being proposed.”

Mercer also posited that the allowance of a local-option excise tax would pave the way for a sales tax elsewhere.

“We will rue the day that we did this,” he said.

Hopkins said lawmakers had a choice between his bill and I-190, which technically became law after the voters passed it last year. If HB701 didn’t pass before the end of the session, the recreational marijuana market would launch under the provisions of I-190. For much of the debate, adopting I-190 as-is was the preference of Democrats and the initiative’s supporters, but amendments introduced in the Senate to use recreational marijuana tax revenues to fund conservation easements under the Habitat Montana program beginning in 2023 helped earned support from the minority that was ultimately crucial for getting the bill through.

“Voting against 701 is the literal acknowledgement of I-190,” Hopkins said.

Environmental groups in Montana lauded the passage of the bill Tuesday.

“This is a win for public access, a win for working ranches, and a win for our outdoor recreation economy,” said Nick Gevock, conservation director with the Montana Wildlife Federation. The conservation program that would come out the furthest ahead under HB701 is Habitat Montana, which leverages a combination of funds to secure easements on private land.

“Just last year alone, we had more than $33 million in private land conservation projects proposed to the state, and we were able to fund $21 million of them,” Gevock said.

The full funding for the program isn’t technically available until the next biennium. One session’s legislature can’t bind the hands of the next, so future lawmakers can change how the marijuana funds are allocated.

“The money will accrue, and it’s incumbent upon us to continue our campaign and continue our support and hopefully see some teed up really quality projects waiting for the money,” Gevock said, adding that it’s a “great day for Montana.”

Arren Kimbel-Sannit is a reporter for the Daily Montanan, a nonprofit news organization in Helena.