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Vermont could become the first state to legalize marijuana through the legislature

The Vermont Statehouse in Montpelier, Vermont.
The Vermont Statehouse in Montpelier, Vermont.
Brian Eden/Moment via Getty Images

Vermont may soon make history: Its legislature could be the very first in the country to legalize marijuana.

On Thursday, the Vermont Senate passed a pot legalization bill. It now moves to the House, which will need to approve it before it ends up on the governor's desk. But Gov. Peter Shumlin has said he supports the bill.

Vermont wouldn't be the first state to legalize pot; it follows in the steps of four other states — Colorado, Washington, Oregon, and Alaska — and Washington, DC. But all those places approved legalization through a general election vote, so the legislature didn't decide the issue.

Vermont has been considering marijuana legalization for years, previously commissioning a report from the RAND Corporation about the policy. In 2015, RAND teamed up with drug policy experts across the country to release a 218-page report detailing what marijuana legalization would look like in the state, how it would affect neighboring states, and what options lawmakers had in changing marijuana policy.

The report came out mostly against a for-profit model, fearing it could lead to a pot industry that acts with little regard to public health and safety, much like the alcohol and tobacco industries.

But the Vermont Senate appeared to ignore much of the RAND report's ideas, moving forward with a legal pot market similar to the one in Colorado and Washington state. The result is a bill that Vermonters will likely approve of but will likely prove disappointing to many drug policy experts.

The Vermont bill would allow retail outlets to open in 2018

Vermont Gov. Peter Shumlin talks in front of Congress.
Vermont Gov. Peter Shumlin talks in front of Congress.
Chip Somodevilla/Getty Images

The Vermont bill would legalize possession of up to an ounce of marijuana for adults 21 and older starting in 2018. It would also allow state-licensed pot growing facilities and retail stores. The state would charge a 25 percent tax on marijuana sales, which would go to drug treatment and prevention, law enforcement, and administrating regulations.

The bill would not, however, legalize edible pot products or home-growing marijuana, though both remain legal for medical purposes (Vermont legalized medical marijuana in 2004). It would also enhance penalties for people 21 and older who provide pot to minors.

(A fuller, albeit slightly outdated, bill summary is available here.)

The argument for the bill: Marijuana legalization could generate millions in tax revenue and eliminate prohibition's downsides (thousands of arrestsracial disparities in law enforcement, and a black market that funds violent criminal groups and drug cartels).

The argument against the bill: Allowing for-profit companies to mass produce, market, and sell marijuana could lead to more use and abuse, exacerbating public health problems with drug addiction.

The Senate passed the measure. But reports indicate a much tougher fight in the House, where there is less support for legalization. Gov. Shumlin supports the bill, saying it meets the five criteria he outlined in his State of the State address:

• A legal market must keep marijuana and other drugs out of the hands of underage kids. With 83 percent of Vermont youth saying that marijuana is easy or somewhat easy to obtain, the current system doesn't do this.

• The tax imposed must be low enough to wipe out the black market and get rid of the illegal drug dealers.

• Revenue from legalization must be used to expand addiction prevention programs.

• Law enforcement's capacity to improve the response to impaired drivers under the influence of marijuana who are already on Vermont's roads must be strengthened.

• The sale of edibles must be prohibited at first.

Vermont already decriminalized pot in 2013, so the measure would not remove any criminal penalties for possession that can result in jail time. But it would remove the fine currently in place for marijuana possession, which can go up to $500. And, of course, it would allow legal sales.

Most Vermonters support marijuana legalization

Marijuana plants. Christopher Furlong/Getty Images

One big argument for passage: Vermonters approve of pot legalization. A February survey by Vermont Public Radio found that 55 percent of Vermonters back legalizing and regulating marijuana, while just 32 percent oppose it. That echoed a previous poll from last year, which put the margin at 56-34.

Vermont is actually quite close to the rest of the country in this regard. An October 2015 survey by Gallup found 58 percent of Americans support legalization. Support is particularly strong among younger demographics.

About 58 percent of Americans now support marijuana legalization. Gallup

The trend of increasing support, particularly among younger Americans, suggests that America — and Vermont — is headed toward legalization. So even if state legislators don't act this year, it's likely they will in the next legislative session or one after that. The question, then, is mostly how to legalize pot, not if.

Vermont's marijuana bill will disappoint some drug policy experts

While Vermont's bill appeals to state residents and some lawmakers, many policy experts will be disappointed.

Until now, the voter-approved laws that passed in the states (but not DC) have been broadly the same — taking up a commercial model that lets for-profit enterprises grow and sell marijuana and likely isn't the best option for public health and safety. (The worry, as I'll detail later, is that for-profit companies will focus on selling pot to people who use too much marijuana, much like tobacco companies did with cigarette addicts.)

Experts widely attributed the persistence of the commercial model to the fact that these states legalized through voter referendums. It's perceived as much easier to convince voters that pot should be legalized and sold much in the same way as alcohol, while it may be tricky to sell voters on the idea that, for example, nonprofits should sell pot or the government should through a tightly regulated state-run monopoly.

But many experts hoped that legislators, with more time to work out the nuances of drug policy, would be able to land on something that didn't lead to for-profit entities selling marijuana.

That's why the RAND marijuana legalization report outlined 12 options for changing marijuana policy, most of which did not involve commercialization:

  • Keep marijuana prohibition in place.
  • Increase criminal penalties for pot.
  • Legalize marijuana through an alcohol-style model, where pot is sold largely for profit.
  • Repeal penalties for marijuana without any regulations for how it will be sold.
  • Allow adults to grow their own marijuana, even as marijuana sales remain illegal.
  • Allow distribution of marijuana only within small co-ops or buyers' clubs.
  • Allow only locally controlled retail sales.
  • Allow only state government–operated retail outlets. (Basically, the government would directly sell pot — much like some states do with liquor stores.)
  • Allow a public authority to manage marijuana growing and sales.
  • Allow only nonprofit organizations to sell marijuana.
  • Allow only for-benefit companies to sell pot.
  • Allow only a very limited number of for-profit outlets to sell marijuana.

Pat Oglesby, one of the authors of the RAND report, said he's "cautiously optimistic" that the bill could change in the Vermont House. "I'm hopeful until the process plays out," he said. "If there's a snag, someone may push" a more moderate policy — not just a state monopoly, but maybe nonprofit businesses as well.

It's also possible that regulators could require some fairly strict rules and standards for retail outlets through the licensing process.

But as it stands, the measure allows 10 to 20 cultivators and 20 to 40 retail outlets — all for-profit businesses — in 2018. For a state with 630,000 residents, that's a lot of pot businesses.

Commercialization seems to be the future of marijuana legalization — and that's worrying

Kevin Sabet, co-founder of the anti-legalization group Smart Approaches to Marijuana, speaks in front of Congress.
Kevin Sabet, co-founder of the anti-legalization group Smart Approaches to Marijuana, speaks in front of Congress.

Drew Angerer/Getty Images

The major concern with full legalization is that big for-profit companies will get into the marijuana industry and market the drug in ways that encourage widespread use and abuse.

Take, for instance, Big Alcohol, which has successfully lobbied to block tax increases and regulations on alcohol — all while marketing its products as fun and sexy during television programs as big as the Super Bowl, which is seen by millions of people, including children. And about 88,000 Americans die as a result of alcohol each year.

As Kevin Sabet, co-founder of the anti-legalization group Smart Approaches to Marijuana, told me in March 2015:

If we were a country with a history of being able to promote moderation in our consumer use of products, or promote responsible corporate advertising or no advertising, or if we had a history of being able to take taxes gained from a vice and redirect them into some positive areas, I might be less concerned about what I see happening in this country. But I think we have a horrible history of dealing with these kinds of things.

Drug policy experts like Mark Kleiman at New York University's Marron Institute and Beau Kilmer at the RAND Corporation point to Colorado, where one study of the state's pot market conducted by the Marijuana Policy Group for the Colorado Department of Revenue found the top 29.9 percent heaviest pot users in the state made up 87.1 percent of demand for the drug. For the marijuana industry, that makes the heaviest users the most lucrative customers.

Colorado marijuana demand

If marijuana companies are able to act like the tobacco and alcohol industries have in the past, there's a good chance that they'll convince more Americans to try or even regularly use marijuana, and some of the heaviest users may use more. And as these companies increase their profits, they'll be able to influence lawmakers in a way that could stifle regulations or other policies that curtail abuse.

Why is abuse such a big concern, particularly for a drug that has very few direct health harms? As Jon Caulkins, a drug policy expert at Carnegie Mellon University, previously told me, "At some level, we know that spending more than half of your waking hours intoxicated for years and years on end is not increasing the likelihood that you'll win a Pulitzer Prize or discover the cure for cancer."

To avoid more marijuana abuse, the favorite idea among policy experts seems to be a state monopoly — a model in which the state government would directly sell pot, so it could directly manage prices, business hours, who can buy the product, and so on. An April report from the RAND Drug Policy Research Center found that states that did this with alcohol, such as Ohio and Virginia, generally kept prices higher, reduced access to youth, and reduced overall levels of consumption.

"It would set up the next president to shut down this program completely"

But government monopolies for marijuana run into a huge hurdle: federal prohibition. Since marijuana remains illegal at the federal level, opening up government-run shops would in effect put state employees in the very awkward position of breaking federal law.

Matt Simon, the New England political director at the Marijuana Policy Project, said that worries over federal intervention killed the idea of a state monopoly for the Vermont legislature. "Most people don't even think you can really do that," he said. "It would set up the next president to shut down this program completely."

While activists acknowledge the concerns of more abuse, they argue legalization is worth the risks of commercialization, simply because the effects of prohibition have been so bad — millions of arrests, racial disparities, and a black market that finances criminal groups and drug cartels. (Although I also prefer a government monopoly for pot, I agree with legalization advocates that even commercialization is better than prohibition.)

So advocates have pushed for legalization, even if it means commercialization. And it seems to be working in Vermont.