I 

117TH CONGRESS 

1ST SESSION H. R. 3617 

To decriminalize and deschedule cannabis, to provide for reinvestment in 

certain persons adversely impacted by the War on Drugs, to provide 

for expungement of certain cannabis offenses, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 28, 2021 

Mr. NADLER (for himself, Ms. LEE of California, Mr. BLUMENAUER, Ms. 

JACKSON LEE, Mr. JEFFRIES, and Ms. VELA ́ZQUEZ) introduced the following bill; which was referred to the Committee on the Judiciary, and 

in addition to the Committees on Energy and Commerce, Agriculture, 

Education and Labor, Ways and Means, Small Business, Natural Resources, Oversight and Reform, and Transportation and Infrastructure, 

for a period to be subsequently determined by the Speaker, in each case 

for consideration of such provisions as fall within the jurisdiction of the 

committee concerned 

A BILL 

To decriminalize and deschedule cannabis, to provide for 

reinvestment in certain persons adversely impacted by 

the War on Drugs, to provide for expungement of certain 

cannabis offenses, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 


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1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘Marijuana Opportunity 

3 Reinvestment and Expungement Act of 2021’’ or the 

4 ‘‘MORE Act of 2021’’. 

5 SEC. 2. FINDINGS. 

6 The Congress finds as follows: 

7 (1) The communities that have been most 

8 harmed by cannabis prohibition are benefiting the 

9 least from the legal marijuana marketplace. 

10 (2) A legacy of racial and ethnic injustices, 

11 compounded by the disproportionate collateral con12 sequences of 80 years of cannabis prohibition en13 forcement, now limits participation in the industry. 

14 (3) 37 States, the District of Columbia, Puerto 

15 Rico, Guam, and the U.S. Virgin Islands have 

16 adopted laws allowing legal access to cannabis, and 

17 15 States, the District of Columbia, the Common18 wealth of the Northern Mariana Islands, and Guam 

19 have adopted laws legalizing cannabis for adult rec20 reational use. 

21 (4) A total of 47 States have reformed their 

22 laws pertaining to cannabis despite the Schedule I 

23 status of marijuana and its Federal criminalization. 

24 (5) Legal cannabis sales totaled 

25 $20,000,000,000 in 2020 and are projected to reach 

26 $40,500,000,000 by 2025. 


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1 (6) According to the American Civil Liberties 

2 Union (ACLU), enforcing cannabis prohibition laws 

3 costs taxpayers approximately $3.6 billion a year. 

4 (7) The continued enforcement of cannabis pro5 hibition laws results in over 600,000 arrests annu6 ally, disproportionately impacting people of color 

7 who are almost 4 times more likely to be arrested 

8 for cannabis possession than their White counter9 parts, despite equal rates of use across populations. 

10 (8) People of color have been historically tar11 geted by discriminatory sentencing practices result12 ing in Black men receiving drug sentences that are 

13 13.1 percent longer than sentences imposed for 

14 White men and Latinos being nearly 6.5 times more 

15 likely to receive a Federal sentence for cannabis pos16 session than non-Hispanic Whites. 

17 (9) In 2013, simple cannabis possession was the 

18 fourth most common cause of deportation for any of19 fense and the most common cause of deportation for 

20 drug law violations. 

21 (10) Fewer than one-fifth of cannabis business 

22 owners identify as minorities and only approximately 

23 4 percent are black. 

24 (11) Applicants for cannabis licenses are lim25 ited by numerous laws, regulations, and exorbitant 


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1 permit applications, licensing fees, and costs in these 

2 States, which can require more than $700,000. 

3 (12) Historically disproportionate arrest and 

4 conviction rates make it particularly difficult for 

5 people of color to enter the legal cannabis market6 place, as most States bar these individuals from par7 ticipating. 

8 (13) Federal law severely limits access to loans 

9 and capital for cannabis businesses, disproportion10 ately impacting minority small business owners. 

11 (14) Some States and municipalities have taken 

12 proactive steps to mitigate inequalities in the legal 

13 cannabis marketplace and ensure equal participation 

14 in the industry. 

15 SEC. 3. DECRIMINALIZATION OF CANNABIS. 

16 (a) CANNABIS REMOVED FROM SCHEDULE OF CON17 TROLLED SUBSTANCES.— 

18 (1) REMOVAL IN STATUTE.—Subsection (c) of 

19 schedule I of section 202(c) of the Controlled Sub20 stances Act (21 U.S.C. 812) is amended— 

21 (A) by striking ‘‘(10) Marihuana.’’; and 

22 (B) by striking ‘‘(17) 

23 Tetrahydrocannabinols, except for 

24 tetrahydrocannabinols in hemp (as defined in 


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1 section 297A of the Agricultural Marketing Act 

2 of 1946).’’. 

3 (2) REMOVAL FROM SCHEDULE.—Not later 

4 than 180 days after the date of the enactment of 

5 this Act, the Attorney General shall finalize a rule6 making under section 201(a)(2) removing mari7 huana and tetrahydrocannabinols from the schedules 

8 of controlled substances. For the purposes of the 

9 Controlled Substances Act, marihuana and 

10 tetrahydrocannabinols shall each be deemed to be a 

11 drug or other substance that does not meet the re12 quirements for inclusion in any schedule. A rule13 making under this paragraph shall be considered to 

14 have taken effect as of the date of enactment of this 

15 Act for purposes of any offense committed, case 

16 pending, conviction entered, and, in the case of a ju17 venile, any offense committed, case pending, and ad18 judication of juvenile delinquency entered before, on, 

19 or after the date of enactment of this Act. 

20 (b) CONFORMING AMENDMENTS TO CONTROLLED

21 SUBSTANCES ACT.—The Controlled Substances Act (21 

22 U.S.C. 801 et seq.) is amended— 

23 (1) in section 102(44) (21 U.S.C. 802(44)), by 

24 striking ‘‘marihuana,’’; 

25 (2) in section 401(b) (21 U.S.C. 841(b))— 


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1 (A) in paragraph (1)— 

2 (i) in subparagraph (A)— 

3 (I) in clause (vi), by inserting 

4 ‘‘or’’ after the semicolon; 

5 (II) by striking clause (vii); and 

6 (III) by redesignating clause 

7 (viii) as clause (vii); 

8 (ii) in subparagraph (B)— 

9 (I) in clause (vi), by inserting 

10 ‘‘or’’ after the semicolon; 

11 (II) by striking clause (vii); and 

12 (III) by redesignating clause 

13 (viii) as clause (vii); 

14 (iii) in subparagraph (C), in the first 

15 sentence, by striking ‘‘subparagraphs (A), 

16 (B), and (D)’’ and inserting ‘‘subpara17 graphs (A) and (B)’’; 

18 (iv) by striking subparagraph (D); 

19 (v) by redesignating subparagraph (E) 

20 as subparagraph (D); and 

21 (vi) in subparagraph (D)(i), as so re22 designated, by striking ‘‘subparagraphs (C) 

23 and (D)’’ and inserting ‘‘subparagraph 

24 (C)’’; 

25 (B) by striking paragraph (4); and 


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1 (C) by redesignating paragraphs (5), (6), 

2 and (7) as paragraphs (4), (5), and (6), respec3 tively; 

4 (3) in section 402(c)(2)(B) (21 U.S.C. 

5 842(c)(2)(B)), by striking ‘‘, marihuana,’’; 

6 (4) in section 403(d)(1) (21 U.S.C. 843(d)(1)), 

7 by striking ‘‘, marihuana,’’; 

8 (5) in section 418(a) (21 U.S.C. 859(a)), by 

9 striking the last sentence; 

10 (6) in section 419(a) (21 U.S.C. 860(a)), by 

11 striking the last sentence; 

12 (7) in section 422(d) (21 U.S.C. 863(d))— 

13 (A) in the matter preceding paragraph (1), 

14 by striking ‘‘marijuana,’’; and 

15 (B) in paragraph (5), by striking ‘‘, such 

16 as a marihuana cigarette,’’; and 

17 (8) in section 516(d) (21 U.S.C. 886(d)), by 

18 striking ‘‘section 401(b)(6)’’ each place the term ap19 pears and inserting ‘‘section 401(b)(5)’’. 

20 (c) OTHER CONFORMING AMENDMENTS.— 

21 (1) NATIONAL FOREST SYSTEM DRUG CONTROL

22 ACT OF 1986.—The National Forest System Drug 

23 Control Act of 1986 (16 U.S.C. 559b et seq.) is 

24 amended— 


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1 (A) in section 15002(a) (16 U.S.C. 

2 559b(a)) by striking ‘‘marijuana and other’’; 

3 (B) in section 15003(2) (16 U.S.C. 

4 559c(2)) by striking ‘‘marijuana and other’’; 

5 and 

6 (C) in section 15004(2) (16 U.S.C. 

7 559d(2)) by striking ‘‘marijuana and other’’. 

8 (2) INTERCEPTION OF COMMUNICATIONS.—Sec9 tion 2516 of title 18, United States Code, is amend10 ed— 

11 (A) in subsection (1)(e), by striking ‘‘mari12 huana,’’; and 

13 (B) in subsection (2) by striking ‘‘mari14 huana’’. 

15 (3) FMCSA PROVISIONS.— 

16 (A) CONFORMING AMENDMENT.—Section 

17 31301(5) of title 49, United States Code, is 

18 amended by striking ‘‘section 31306,’’ and in19 serting ‘‘sections 31306, 31306a, and sub20 sections (b) and (c) of section 31310,’’. 

21 (B) DEFINITION.—Section 31306(a) of 

22 title 49, United States Code, is amended— 

23 (i) by striking ‘‘means any substance’’ 

24 and inserting the following: ‘‘means— 

25 ‘‘(A) any substance’’; and 


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1 (ii) by striking the period at the end 

2 and inserting ‘‘; and 

3 ‘‘(B) any substance not covered under sub4 paragraph (A) that was a substance under such 

5 section as of December 1, 2018, and specified 

6 by the Secretary of Transportation.’’. 

7 (C) DISQUALIFICATIONS.—Section 

8 31310(b) of title 49, United States Code, is 

9 amended by adding at the end the following: 

10 ‘‘(3) In this subsection and subsection (c), the 

11 term ‘controlled substance’ has the meaning given 

12 such term in section 31306(a).’’. 

13 (4) FAA PROVISIONS.—Section 45101 of title 

14 49, United States Code, is amended— 

15 (A) by striking ‘‘means any substance’’ 

16 and inserting the following: ‘‘means— 

17 ‘‘(A) any substance’’; and 

18 (B) by striking the period at the end and 

19 inserting ‘‘; and 

20 ‘‘(B) any substance not covered under sub21 paragraph (A) that was a substance under such 

22 section as of December 1, 2018, and specified 

23 by the Secretary of Transportation.’’. 

24 (5) FRA PROVISIONS.—Section 20140(a) of 

25 title 49, United States Code, is amended— 


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1 (A) by striking ‘‘means any substance’’ 

2 and inserting the following: ‘‘means— 

3 ‘‘(A) any substance’’; and 

4 (B) by striking the period at the end and 

5 inserting ‘‘; and 

6 ‘‘(B) any substance not covered under sub7 paragraph (A) that was a substance under such 

8 section as of December 1, 2018, and specified 

9 by the Secretary of Transportation.’’. 

10 (6) FTA PROVISIONS.—Section 5331(a)(1) of 

11 title 49, United States Code, is amended— 

12 (A) by striking ‘‘means any substance’’ 

13 and inserting the following: ‘‘means— 

14 ‘‘(A) any substance’’; and 

15 (B) by striking the period at the end and 

16 inserting ‘‘; and 

17 ‘‘(B) any substance not covered under sub18 paragraph (A) that was a substance under such 

19 section as of December 1, 2018, and whose use 

20 the Secretary of Transportation decides has a 

21 risk to transportation safety.’’. 

22 (d) RETROACTIVITY.—The amendments made by this 

23 section to the Controlled Substances Act (21 U.S.C. 801 

24 et seq.) are retroactive and shall apply to any offense com25 mitted, case pending, conviction entered, and, in the case 


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1 of a juvenile, any offense committed, case pending, or ad2 judication of juvenile delinquency entered before, on, or 

3 after the date of enactment of this Act. 

4 (e) EFFECT ON OTHER LAW.—Nothing in this sub5 title shall affect or modify— 

6 (1) the Federal Food, Drug, and Cosmetic Act 

7 (21 U.S.C. 301 et seq.); 

8 (2) section 351 of the Public Health Service 

9 Act (42 U.S.C. 262); or 

10 (3) the authority of the Commissioner of Food 

11 and Drugs and the Secretary of Health and Human 

12 Services— 

13 (A) under— 

14 (i) the Federal Food, Drug, and Cos15 metic Act (21 U.S. 301 et seq.); or 

16 (ii) section 351 of the Public Health 

17 Service Act (42 U.S.C. 262); or 

18 (B) to promulgate Federal regulations and 

19 guidelines that relate to products containing 

20 cannabis or cannabis-derived compounds under 

21 the Act described in subparagraph (A)(i) or the 

22 section described in subparagraph (A)(ii). 

23 (f) PUBLIC MEETINGS.—Not later than one year 

24 after the date of enactment of this Act, the Secretary of 

25 Health and Human Services, acting through the CommisVerDate Sep 11 2014 06:18 Jul 03, 2021 Jkt 019200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H3617.IH H3617

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1 sioner of Food and Drugs, shall hold not less than one 

2 public meeting to address the regulation, safety, manufac3 turing, product quality, marketing, labeling, and sale of 

4 products containing cannabis or cannabis-derived com5 pounds. 

6 (g) SPECIAL RULE FOR FEDERAL EMPLOYEE TEST7 ING.—Section 503 of the Supplemental Appropriations 

8 Act, 1987 (5 U.S.C. 7301 note) is amended by adding at 

9 the end the following: 

10 ‘‘(h) MARIJUANA.— 

11 ‘‘(1) CONTINUED TESTING.—Notwithstanding 

12 the Marijuana Opportunity Reinvestment and 

13 Expungement Act of 2021 and the amendments 

14 made thereby, the Secretary of Health and Human 

15 Services may continue to include marijuana for pur16 poses of drug testing of Federal employees subject 

17 to this section, Executive Order 12564, or other ap18 plicable Federal laws and orders. 

19 ‘‘(2) DEFINITION.—The term ‘marijuana’ has 

20 the meaning given to the term ‘marihuana’ in sec21 tion 102 of the Controlled Substances Act (21 6 

22 U.S.C. 802) on the day before the date of enactment 

23 of the Marijuana Opportunity Reinvestment and 

24 Expungement Act of 2021.’’. 

25 (h) SPECIAL RULE FOR CERTAIN REGULATIONS.— 


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1 (1) IN GENERAL.—The amendments made by 

2 this section may not be construed to abridge the au3 thority of the Secretary of Transportation, or the 

4 Secretary of the department in which the Coast 

5 Guard is operating, to regulate and screen for the 

6 use of a controlled substance. 

7 (2) CONTROLLED SUBSTANCE DEFINED.—In 

8 this subsection, the term ‘‘controlled substance’’ 

9 means— 

10 (A) any substance covered under section 

11 102 of the Controlled Substances Act (21 

12 U.S.C. 802) on the day before the date of en13 actment of this Act; and 

14 (B) any substance not covered under sub15 paragraph (A) that was a substance covered 

16 under section 102 of the Controlled Substances 

17 Act (21 U.S.C. 802) on December 1, 2018, and 

18 specified by the Secretary of Transportation. 

19 SEC. 4. DEMOGRAPHIC DATA OF CANNABIS BUSINESS OWN20 ERS AND EMPLOYEES. 

21 (a) IN GENERAL.—The Bureau of Labor Statistics 

22 shall regularly compile, maintain, and make public data 

23 on the demographics of— 

24 (1) individuals who are business owners in the 

25 cannabis industry; and 


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1 (2) individuals who are employed in the can2 nabis industry. 

3 (b) DEMOGRAPHIC DATA.—The data collected under 

4 subsection (a) shall include data regarding— 

5 (1) age; 

6 (2) certifications and licenses; 

7 (3) disability status; 

8 (4) educational attainment; 

9 (5) family and marital status; 

10 (6) nativity; 

11 (7) race and Hispanic ethnicity; 

12 (8) school enrollment; 

13 (9) veteran status; and 

14 (10) sex. 

15 (c) CONFIDENTIALITY.—The name, address, and 

16 other identifying information of individuals employed in 

17 the cannabis industry shall be kept confidential by the Bu18 reau and not be made available to the public. 

19 (d) DEFINITIONS.—In this section: 

20 (1) CANNABIS.—The term ‘‘cannabis’’ means 

21 either marijuana or cannabis as defined under the 

22 State law authorizing the sale or use of cannabis in 

23 which the individual or entity is located. 

24 (2) CANNABIS INDUSTRY.—The term ‘‘cannabis 

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1 censed or permitted under a State or local law to en2 gage in commercial cannabis-related activity. 

3 (3) OWNER.—The term ‘‘owner’’ means an in4 dividual or entity that is defined as an owner under 

5 the State or local law where the individual or busi6 ness is licensed or permitted. 

7 SEC. 5. CREATION OF OPPORTUNITY TRUST FUND AND IM8 POSITION OF TAXES WITH RESPECT TO CAN9 NABIS PRODUCTS. 

10 (a) ESTABLISHMENT OF TRUST FUND.—Subchapter 

11 A of chapter 98 of the Internal Revenue Code of 1986 

12 is amended by adding at the end the following new section: 

13 ‘‘SEC. 9512. OPPORTUNITY TRUST FUND. 

14 ‘‘(a) CREATION OF TRUST FUND.—There is estab15 lished in the Treasury of the United States a trust fund 

16 to be known as the ‘Opportunity Trust Fund’ (referred 

17 to in this section as the ‘Trust Fund’), consisting of such 

18 amounts as may be appropriated or credited to such fund 

19 as provided in this section or section 9602(b). 

20 ‘‘(b) TRANSFERS TO TRUST FUND.—There are here21 by appropriated to the Trust Fund amounts equivalent to 

22 the net revenues received in the Treasury from the taxes 

23 imposed under chapter 56. 


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1 ‘‘(c) EXPENDITURES.—Amounts in the Trust Fund 

2 shall be available, without further appropriation, only as 

3 follows: 

4 ‘‘(1) 50 percent to the Attorney General to 

5 carry out section 3052(a) of part OO of the Omni6 bus Crime Control and Safe Streets Act of 1968. 

7 ‘‘(2) 10 percent to the Attorney General to 

8 carry out section 3052(b) of part OO of the Omni9 bus Crime Control and Safe Streets Act of 1968. 

10 ‘‘(3) 20 percent to the Administrator of the 

11 Small Business Administration to carry out section 

12 6(b)(1) of the Marijuana Opportunity Reinvestment 

13 and Expungement Act of 2021. 

14 ‘‘(4) 20 percent to the Administrator of the 

15 Small Business Administration to carry out section 

16 6(b)(2) of the Marijuana Opportunity Reinvestment 

17 and Expungement Act of 2021.’’. 

18 (b) CANNABIS REVENUE AND REGULATION ACT.— 

19 Subtitle E of the Internal Revenue Code of 1986 is 

20 amended by adding at the end the following new chapter: 

21 ‘‘CHAPTER 56—CANNABIS PRODUCTS 

‘‘SUBCHAPTER A. TAX ON CANNABIS PRODUCTS

‘‘SUBCHAPTER B. OCCUPATIONAL TAX

‘‘SUBCHAPTER C. BOND AND PERMITS

‘‘SUBCHAPTER D. OPERATIONS

‘‘SUBCHAPTER E. PENALTIES


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1 ‘‘Subchapter A—Tax on Cannabis Products 

‘‘Sec. 5901. Imposition of tax. 

‘‘Sec. 5902. Definitions. 

‘‘Sec. 5903. Liability and method of payment. 

‘‘Sec. 5904. Exemption from tax; transfers in bond. 

‘‘Sec. 5905. Credit, refund, or drawback of tax. 

2 ‘‘SEC. 5901. IMPOSITION OF TAX. 

3 ‘‘(a) IMPOSITION OF TAX.—There is hereby imposed 

4 on any cannabis product produced in or imported into the 

5 United States a tax equal to— 

6 ‘‘(1) for any such product removed during the 

7 first 5 calendar years ending after the date on which 

8 this chapter becomes effective, the applicable per9 centage of such product’s removal price, and 

10 ‘‘(2) for any product removed during any cal11 endar year after the calendar years described in 

12 paragraph (1), the applicable equivalent amount. 

13 ‘‘(b) APPLICABLE PERCENTAGE.—For purposes of 

14 subsection (a)(1), the applicable percentage shall be deter15 mined as follows: 

16 ‘‘(1) For any cannabis product removed during 

17 the first 2 calendar years ending after the date on 

18 which this chapter becomes effective, 5 percent. 

19 ‘‘(2) For any cannabis product removed during 

20 the calendar year after the last calendar year to 

21 which paragraph (1) applies, 6 percent. 


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1 ‘‘(3) For any cannabis product removed during 

2 the calendar year after the calendar year to which 

3 paragraph (2) applies, 7 percent. 

4 ‘‘(4) For any cannabis product removed during 

5 the calendar year after the calendar year to which 

6 paragraph (3) applies, 8 percent. 

7 ‘‘(c) APPLICABLE EQUIVALENT AMOUNT.— 

8 ‘‘(1) IN GENERAL.—For purposes of subsection 

9 (a)(2), the term ‘applicable equivalent amount’ 

10 means, with respect to any cannabis product re11 moved during any calendar year, an amount equal 

12 to— 

13 ‘‘(A) in the case of any cannabis product 

14 not described in subparagraph (B), the product 

15 of the applicable rate per ounce multiplied by 

16 the number of ounces of such product (and a 

17 proportionate tax at the like rate on all frac18 tional parts of an ounce of such product), and 

19 ‘‘(B) in the case of any THC-measurable 

20 cannabis product, the product of the applicable 

21 rate per gram multiplied by the number of 

22 grams of tetrahydrocannabinol in such product 

23 (and a proportionate tax at the like rate on all 

24 fractional parts of a gram of 

25 tetrahydrocannabinol in such product). 


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1 ‘‘(2) APPLICABLE RATES.— 

2 ‘‘(A) IN GENERAL.—For purposes of para3 graph (1)(A), the term ‘applicable rate per 

4 ounce’ means, with respect to any cannabis 

5 product removed during any calendar year, 8 

6 percent of the prevailing sales price of cannabis 

7 flowers sold in the United States during the 12- 

8 month period ending one calendar quarter be9 fore such calendar year, expressed on a per 

10 ounce basis, as determined by the Secretary. 

11 ‘‘(B) THC-MEASURABLE CANNABIS PROD12 UCTS.—For purposes of paragraph (1)(B), the 

13 term ‘applicable rate per gram’ means, with re14 spect to any cannabis product removed during 

15 any calendar year, 8 percent of the prevailing 

16 sales price of tetrahydrocannabinol sold in the 

17 United States during the 12-month period end18 ing one calendar quarter before such calendar 

19 year, expressed on a per gram basis, as deter20 mined by the Secretary. 

21 ‘‘(d) TIME OF ATTACHMENT ON CANNABIS PROD22 UCTS.—The tax under this section shall attach to any can23 nabis product as soon as such product is in existence as 

24 such, whether it be subsequently separated or transferred 


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1 into any other substance, either in the process of original 

2 production or by any subsequent process. 

3 ‘‘SEC. 5902. DEFINITIONS. 

4 ‘‘(a) DEFINITIONS RELATED TO CANNABIS PROD5 UCTS.—For purposes of this chapter— 

6 ‘‘(1) CANNABIS PRODUCT.— 

7 ‘‘(A) IN GENERAL.—Except as provided in 

8 subparagraph (B), the term ‘cannabis product’ 

9 means any article which contains (or consists 

10 of) cannabis. 

11 ‘‘(B) EXCEPTIONS.—The term ‘cannabis 

12 product’ shall not include an FDA-approved ar13 ticle or industrial hemp. 

14 ‘‘(C) FDA-APPROVED ARTICLE.—The term 

15 ‘FDA-approved article’ means any article if the 

16 producer or importer thereof demonstrates to 

17 the satisfaction of the Secretary of Health and 

18 Human Services that such article is— 

19 ‘‘(i) a drug— 

20 ‘‘(I) that is approved under sec21 tion 505 of the Federal Food, Drug, 

22 and Cosmetic Act or licensed under 

23 section 351 of the Public Health Serv24 ice Act, or 


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1 ‘‘(II) for which an investigational 

2 use exemption has been authorized 

3 under section 505(i) of the Federal 

4 Food, Drug, and Cosmetic Act or 

5 under section 351(a) of the Public 

6 Health Service Act, or 

7 ‘‘(ii) a combination product (as de8 scribed in section 503(g) of the Federal 

9 Food, Drug, and Cosmetic Act), the con10 stituent parts of which were approved or 

11 cleared under section 505, 510(k), or 515 

12 of such Act. 

13 ‘‘(D) INDUSTRIAL HEMP.—The term ‘in14 dustrial hemp’ means the plant Cannabis sativa 

15 L. and any part of such plant, whether growing 

16 or not, with a delta-9 tetrahydrocannabinol con17 centration of not more than 0.3 percent on a 

18 dry weight basis. 

19 ‘‘(2) THC-MEASURABLE CANNABIS PRODUCT.— 

20 The term ‘THC-measurable cannabis product’ 

21 means any cannabis product— 

22 ‘‘(A) with respect to which the Secretary 

23 has made a determination that the amount of 

24 tetrahydrocannabinol in such product can be 

25 measured with a high degree of accuracy, or 


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1 ‘‘(B) which is not cannabis flower and the 

2 concentration of tetrahydrocannabinol in which 

3 is significantly higher than the average such 

4 concentration in cannabis flower. 

5 ‘‘(3) CANNABIS.—The term ‘cannabis’ has the 

6 meaning given such term under section 102(16) of 

7 the Controlled Substances Act (21 U.S.C. 802(16)). 

8 ‘‘(b) DEFINITIONS RELATED TO CANNABIS ENTER9 PRISES.—For purposes of this chapter— 

10 ‘‘(1) CANNABIS ENTERPRISE.—The term ‘can11 nabis enterprise’ means a producer, importer, or ex12 port warehouse proprietor. 

13 ‘‘(2) PRODUCER.— 

14 ‘‘(A) IN GENERAL.—The term ‘producer’ 

15 means any person who plants, cultivates, har16 vests, grows, manufactures, produces, com17 pounds, converts, processes, prepares, or pack18 ages any cannabis product. 

19 ‘‘(B) PERSONAL USE EXCEPTION.—Subject 

20 to regulation prescribed by the Secretary, the 

21 term ‘producer’ shall not include any individual 

22 otherwise described in subparagraph (A) if the 

23 only cannabis product described in such sub24 paragraph with respect to such individual is for 

25 personal or family use and not for sale. 


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1 ‘‘(3) IMPORTER.—The term ‘importer’ means 

2 any person who— 

3 ‘‘(A) is in the United States and to whom 

4 non-tax-paid cannabis products, produced in a 

5 foreign country or a possession of the United 

6 States, are shipped or consigned, 

7 ‘‘(B) removes cannabis products for sale or 

8 consumption in the United States from a cus9 toms bonded warehouse, or 

10 ‘‘(C) smuggles or otherwise unlawfully 

11 brings any cannabis product into the United 

12 States. 

13 ‘‘(4) EXPORT WAREHOUSE PROPRIETOR.— 

14 ‘‘(A) IN GENERAL.—The term ‘export 

15 warehouse proprietor’ means any person who 

16 operates an export warehouse. 

17 ‘‘(B) EXPORT WAREHOUSE.—The term 

18 ‘export warehouse’ means a bonded internal 

19 revenue warehouse for the storage of cannabis 

20 products, upon which the internal revenue tax 

21 has not been paid— 

22 ‘‘(i) for subsequent shipment to a for23 eign country or a possession of the United 

24 States, or 


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1 ‘‘(ii) for consumption beyond the ju2 risdiction of the internal revenue laws of 

3 the United States. 

4 ‘‘(5) CANNABIS PRODUCTION FACILITY.—The 

5 term ‘cannabis production facility’ means an estab6 lishment which is qualified under subchapter C to 

7 perform any operation for which such qualification is 

8 required under such subchapter. 

9 ‘‘(c) OTHER DEFINITIONS.—For purposes of this 

10 chapter— 

11 ‘‘(1) PRODUCE.—The term ‘produce’ includes 

12 any activity described in subsection (b)(2)(A). 

13 ‘‘(2) REMOVAL; REMOVE.—The terms ‘removal’ 

14 or ‘remove’ means— 

15 ‘‘(A) the transfer of cannabis products 

16 from the premises of a producer (or the trans17 fer of such products from the bonded premises 

18 of a producer to a non-bonded premises of such 

19 producer), 

20 ‘‘(B) release of such products from cus21 toms custody, or 

22 ‘‘(C) smuggling or other unlawful importa23 tion of such products into the United States. 

24 ‘‘(3) REMOVAL PRICE.—The term ‘removal 

25 price’ means— 


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1 ‘‘(A) except as otherwise provided in this 

2 paragraph, the price for which the cannabis 

3 product is sold in the sale which occurs in con4 nection with the removal of such product, 

5 ‘‘(B) in the case of any such sale which is 

6 described in section 5903(c), the price deter7 mined under such section, and 

8 ‘‘(C) if there is no sale which occurs in 

9 connection with such removal, the price which 

10 would be determined under section 5903(c) if 

11 such product were sold at a price which cannot 

12 be determined. 

13 ‘‘SEC. 5903. LIABILITY AND METHOD OF PAYMENT. 

14 ‘‘(a) LIABILITY FOR TAX.— 

15 ‘‘(1) ORIGINAL LIABILITY.—The producer or 

16 importer of any cannabis product shall be liable for 

17 the taxes imposed thereon by section 5901. 

18 ‘‘(2) TRANSFER OF LIABILITY.— 

19 ‘‘(A) IN GENERAL.—When cannabis prod20 ucts are transferred, without payment of tax, 

21 pursuant to subsection (b) or (c) of section 

22 5904— 

23 ‘‘(i) except as provided in clause (ii), 

24 the transferee shall become liable for the 

25 tax upon receipt by the transferee of such 


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1 articles, and the transferor shall thereupon 

2 be relieved of their liability for such tax, 

3 and 

4 ‘‘(ii) in the case of cannabis products 

5 which are released in bond from customs 

6 custody for transfer to the bonded prem7 ises of a producer, the transferee shall be8 come liable for the tax on such articles 

9 upon release from customs custody, and 

10 the importer shall thereupon be relieved of 

11 their liability for such tax. 

12 ‘‘(B) RETURNED TO BOND.—All provisions 

13 of this chapter applicable to cannabis products 

14 in bond shall be applicable to such articles re15 turned to bond upon withdrawal from the mar16 ket or returned to bond after previous removal 

17 for a tax-exempt purpose. 

18 ‘‘(b) METHOD OF PAYMENT OF TAX.— 

19 ‘‘(1) IN GENERAL.— 

20 ‘‘(A) TAXES PAID ON BASIS OF RETURN.— 

21 The taxes imposed by section 5901 shall be 

22 paid on the basis of return. The Secretary shall, 

23 by regulations, prescribe the period or the event 

24 to be covered by such return and the informa25 tion to be furnished on such return. 


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1 ‘‘(B) APPLICATION TO TRANSFEREES.—In 

2 the case of any transfer to which subsection 

3 (a)(2)(A) applies, the tax under section 5901 on 

4 the transferee shall (if not otherwise relieved by 

5 reason of a subsequent transfer to which such 

6 subsection applies) be imposed with respect to 

7 the removal of the cannabis product from the 

8 bonded premises of the transferee. 

9 ‘‘(C) POSTPONEMENT.—Any postponement 

10 under this subsection of the payment of taxes 

11 determined at the time of removal shall be con12 ditioned upon the filing of such additional 

13 bonds, and upon compliance with such require14 ments, as the Secretary may prescribe for the 

15 protection of the revenue. The Secretary may, 

16 by regulations, require payment of tax on the 

17 basis of a return prior to removal of the can18 nabis products where a person defaults in the 

19 postponed payment of tax on the basis of a re20 turn under this subsection or regulations pre21 scribed thereunder. 

22 ‘‘(D) ADMINISTRATION AND PENALTIES.— 

23 All administrative and penalty provisions of this 

24 title, insofar as applicable, shall apply to any 

25 tax imposed by section 5901. 


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1 ‘‘(2) TIME FOR PAYMENT OF TAXES.— 

2 ‘‘(A) IN GENERAL.—Except as otherwise 

3 provided in this paragraph, in the case of taxes 

4 on cannabis products removed during any semi5 monthly period under bond for deferred pay6 ment of tax, the last day for payment of such 

7 taxes shall be the 14th day after the last day 

8 of such semimonthly period. 

9 ‘‘(B) IMPORTED ARTICLES.—In the case of 

10 cannabis products which are imported into the 

11 United States, the following provisions shall 

12 apply: 

13 ‘‘(i) IN GENERAL.—The last day for 

14 payment of tax shall be the 14th day after 

15 the last day of the semimonthly period 

16 during which the article is entered into the 

17 customs territory of the United States. 

18 ‘‘(ii) SPECIAL RULE FOR ENTRY OF

19 WAREHOUSING.—Except as provided in 

20 clause (iv), in the case of an entry for 

21 warehousing, the last day for payment of 

22 tax shall not be later than the 14th day 

23 after the last day of the semimonthly pe24 riod during which the article is removed 

25 from the first such warehouse. 


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1 ‘‘(iii) FOREIGN TRADE ZONES.—Ex2 cept as provided in clause (iv) and in regu3 lations prescribed by the Secretary, articles 

4 brought into a foreign trade zone shall, 

5 notwithstanding any other provision of law, 

6 be treated for purposes of this subsection 

7 as if such zone were a single customs 

8 warehouse. 

9 ‘‘(iv) EXCEPTION FOR ARTICLES DES10 TINED FOR EXPORT.—Clauses (ii) and (iii) 

11 shall not apply to any article which is 

12 shown to the satisfaction of the Secretary 

13 to be destined for export. 

14 ‘‘(C) CANNABIS PRODUCTS BROUGHT INTO

15 THE UNITED STATES FROM PUERTO RICO.—In 

16 the case of cannabis products which are 

17 brought into the United States from Puerto 

18 Rico and subject to tax under section 7652, the 

19 last day for payment of tax shall be the 14th 

20 day after the last day of the semimonthly pe21 riod during which the article is brought into the 

22 United States. 

23 ‘‘(D) SPECIAL RULE WHERE DUE DATE

24 FALLS ON SATURDAY, SUNDAY, OR HOLIDAY.— 

25 Notwithstanding section 7503, if, but for this 


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1 subparagraph, the due date under this para2 graph would fall on a Saturday, Sunday, or a 

3 legal holiday (as defined in section 7503), such 

4 due date shall be the immediately preceding day 

5 which is not a Saturday, Sunday, or such a hol6 iday. 

7 ‘‘(E) SPECIAL RULE FOR UNLAWFULLY

8 PRODUCED CANNABIS PRODUCTS.—In the case 

9 of any cannabis products produced in the 

10 United States at any place other than the 

11 premises of a producer that has filed the bond 

12 and obtained the permit required under this 

13 chapter, tax shall be due and payable imme14 diately upon production. 

15 ‘‘(3) PAYMENT BY ELECTRONIC FUND TRANS16 FER.—Any person who in any 12-month period, end17 ing December 31, was liable for a gross amount 

18 equal to or exceeding $5,000,000 in taxes imposed 

19 on cannabis products by section 5901 (or section 

20 7652) shall pay such taxes during the succeeding 

21 calendar year by electronic fund transfer (as defined 

22 in section 5061(e)(2)) to a Federal Reserve Bank. 

23 Rules similar to the rules of section 5061(e)(3) shall 

24 apply to the $5,000,000 amount specified in the pre25 ceding sentence. 


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1 ‘‘(c) DETERMINATION OF PRICE.— 

2 ‘‘(1) CONSTRUCTIVE SALE PRICE.— 

3 ‘‘(A) IN GENERAL.—If an article is sold di4 rectly to consumers, sold on consignment, or 

5 sold (otherwise than through an arm’s length 

6 transaction) at less than the fair market price, 

7 or if the price for which the article sold cannot 

8 be determined, the tax under section 5901(a) 

9 shall be computed on the price for which such 

10 articles are sold, in the ordinary course of 

11 trade, by producers thereof, as determined by 

12 the Secretary. 

13 ‘‘(B) ARM’S LENGTH.— 

14 ‘‘(i) IN GENERAL.—For purposes of 

15 this section, a sale is considered to be 

16 made under circumstances otherwise than 

17 at arm’s length if— 

18 ‘‘(I) the parties are members of 

19 the same controlled group, whether or 

20 not such control is actually exercised 

21 to influence the sale price, 

22 ‘‘(II) the parties are members of 

23 a family, as defined in section 

24 267(c)(4), or 


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1 ‘‘(III) the sale is made pursuant 

2 to special arrangements between a 

3 producer and a purchaser. 

4 ‘‘(ii) CONTROLLED GROUPS.— 

5 ‘‘(I) IN GENERAL.—The term 

6 ‘controlled group’ has the meaning 

7 given to such term by subsection (a) 

8 of section 1563, except that ‘more 

9 than 50 percent’ shall be substituted 

10 for ‘at least 80 percent’ each place it 

11 appears in such subsection. 

12 ‘‘(II) CONTROLLED GROUPS

13 WHICH INCLUDE NONINCORPORATED

14 PERSONS.—Under regulations pre15 scribed by the Secretary, principles 

16 similar to the principles of subclause 

17 (I) shall apply to a group of persons 

18 under common control where one or 

19 more of such persons is not a corpora20 tion. 

21 ‘‘(2) CONTAINERS, PACKING AND TRANSPOR22 TATION CHARGES.—In determining, for the purposes 

23 of this chapter, the price for which an article is sold, 

24 there shall be included any charge for coverings and 

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1 dent to placing the article in condition packed ready 

2 for shipment, but there shall be excluded the amount 

3 of tax imposed by this chapter, whether or not stat4 ed as a separate charge. A transportation, delivery, 

5 insurance, installation, or other charge (not required 

6 by the preceding sentence to be included) shall be 

7 excluded from the price only if the amount thereof 

8 is established to the satisfaction of the Secretary in 

9 accordance with regulations. 

10 ‘‘(3) DETERMINATION OF APPLICABLE EQUIVA11 LENT AMOUNTS.—Paragraphs (1) and (2) shall 

12 apply for purposes of section 5901(c) only to the ex13 tent that the Secretary determines appropriate. 

14 ‘‘(d) PARTIAL PAYMENTS AND INSTALLMENT AC15 COUNTS.— 

16 ‘‘(1) PARTIAL PAYMENTS.—In the case of— 

17 ‘‘(A) a contract for the sale of an article 

18 wherein it is provided that the price shall be 

19 paid by installments and title to the article sold 

20 does not pass until a future date notwith21 standing partial payment by installments, 

22 ‘‘(B) a conditional sale, or 

23 ‘‘(C) a chattel mortgage arrangement 

24 wherein it is provided that the sales price shall 

25 be paid in installments, 


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1 there shall be paid upon each payment with respect 

2 to the article a percentage of such payment equal to 

3 the rate of tax in effect on the date such payment 

4 is due. 

5 ‘‘(2) SALES OF INSTALLMENT ACCOUNTS.—If 

6 installment accounts, with respect to payments on 

7 which tax is being computed as provided in para8 graph (1), are sold or otherwise disposed of, then 

9 paragraph (1) shall not apply with respect to any 

10 subsequent payments on such accounts (other than 

11 subsequent payments on returned accounts with re12 spect to which credit or refund is allowable by rea13 son of section 6416(b)(5)), but instead— 

14 ‘‘(A) there shall be paid an amount equal 

15 to the difference between— 

16 ‘‘(i) the tax previously paid on the 

17 payments on such installment accounts, 

18 and 

19 ‘‘(ii) the total tax which would be pay20 able if such installment accounts had not 

21 been sold or otherwise disposed of (com22 puted as provided in paragraph (1)), ex23 cept that 

24 ‘‘(B) if any such sale is pursuant to the 

25 order of, or subject to the approval of, a court 


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1 of competent jurisdiction in a bankruptcy or in2 solvency proceeding, the amount computed 

3 under subparagraph (A) shall not exceed the 

4 sum of the amounts computed by multiplying— 

5 ‘‘(i) the proportionate share of the 

6 amount for which such accounts are sold 

7 which is allocable to each unpaid install8 ment payment, by 

9 ‘‘(ii) the rate of tax under this chap10 ter in effect on the date such unpaid in11 stallment payment is or was due. 

12 The sum of the amounts payable under this 

13 subsection in respect of the sale of any article 

14 shall not exceed the total tax. 

15 ‘‘SEC. 5904. EXEMPTION FROM TAX; TRANSFERS IN BOND. 

16 ‘‘(a) EXEMPTION FROM TAX.—Cannabis products on 

17 which the internal revenue tax has not been paid or deter18 mined may, subject to such regulations as the Secretary 

19 shall prescribe, be withdrawn from the bonded premises 

20 of any producer in approved containers free of tax and 

21 not for resale for use— 

22 ‘‘(1) exclusively in scientific research by a lab23 oratory, 

24 ‘‘(2) by a proprietor of a cannabis production 

25 facility in research, development, or testing (other 


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1 than consumer testing or other market analysis) of 

2 processes, systems, materials, or equipment, relating 

3 to cannabis or cannabis operations, under such limi4 tations and conditions as to quantities, use, and ac5 countability as the Secretary may by regulations re6 quire for the protection of the revenue, or 

7 ‘‘(3) by the United States or any governmental 

8 agency thereof, any State, any political subdivision 

9 of a State, or the District of Columbia, for non10 consumption purposes. 

11 ‘‘(b) CANNABIS PRODUCTS TRANSFERRED OR RE12 MOVED IN BOND FROM DOMESTIC FACTORIES AND EX13 PORT WAREHOUSES.— 

14 ‘‘(1) IN GENERAL.—Subject to such regulations 

15 and under such bonds as the Secretary shall pre16 scribe, a producer or export warehouse proprietor 

17 may transfer cannabis products, without payment of 

18 tax, to the bonded premises of another producer or 

19 export warehouse proprietor, or remove such articles, 

20 without payment of tax, for shipment to a foreign 

21 country or a possession of the United States, or for 

22 consumption beyond the jurisdiction of the internal 

23 revenue laws of the United States. 

24 ‘‘(2) LABELING.—Cannabis products may not 

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1 less such products bear such marks, labels, or no2 tices as the Secretary shall by regulations prescribe. 

3 ‘‘(c) CANNABIS PRODUCTS RELEASED IN BOND

4 FROM CUSTOMS CUSTODY.—Cannabis products imported 

5 or brought into the United States may be released from 

6 customs custody, without payment of tax, for delivery to 

7 a producer or export warehouse proprietor if such articles 

8 are not put up in packages, in accordance with such regu9 lations and under such bond as the Secretary shall pre10 scribe. 

11 ‘‘(d) CANNABIS PRODUCTS EXPORTED AND RE12 TURNED.—Cannabis products classifiable under item 

13 9801.00.10 of the Harmonized Tariff Schedule of the 

14 United States (relating to duty on certain articles pre15 viously exported and returned), as in effect on the date 

16 of the enactment of the Marijuana Opportunity Reinvest17 ment and Expungement Act of 2021, may be released 

18 from customs custody, without payment of that part of 

19 the duty attributable to the internal revenue tax for deliv20 ery to the original producer of such cannabis products or 

21 to the export warehouse proprietor authorized by such pro22 ducer to receive such products, in accordance with such 

23 regulations and under such bond as the Secretary shall 

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1 ject to this chapter as if they had not been exported or 

2 otherwise removed from internal revenue bond. 

3 ‘‘SEC. 5905. CREDIT, REFUND, OR DRAWBACK OF TAX. 

4 ‘‘(a) CREDIT OR REFUND.— 

5 ‘‘(1) IN GENERAL.—Credit or refund of any tax 

6 imposed by this chapter or section 7652 shall be al7 lowed or made (without interest) to the cannabis en8 terprise on proof satisfactory to the Secretary that 

9 the claimant cannabis enterprise has paid the tax 

10 on— 

11 ‘‘(A) cannabis products withdrawn from 

12 the market by the claimant, or 

13 ‘‘(B) such products lost (otherwise than by 

14 theft) or destroyed, by fire, casualty, or act of 

15 God, while in the possession or ownership of the 

16 claimant. 

17 ‘‘(2) CANNABIS PRODUCTS LOST OR DE18 STROYED IN BOND.— 

19 ‘‘(A) EXTENT OF LOSS ALLOWANCE.—No 

20 tax shall be collected in respect of cannabis 

21 products lost or destroyed while in bond, except 

22 that such tax shall be collected— 

23 ‘‘(i) in the case of loss by theft, unless 

24 the Secretary finds that the theft occurred 

25 without connivance, collusion, fraud, or 


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1 negligence on the part of the proprietor of 

2 the cannabis production facility, owner, 

3 consignor, consignee, bailee, or carrier, or 

4 their employees or agents, 

5 ‘‘(ii) in the case of voluntary destruc6 tion, unless such destruction is carried out 

7 as provided in paragraph (3), and 

8 ‘‘(iii) in the case of an unexplained 

9 shortage of cannabis products. 

10 ‘‘(B) PROOF OF LOSS.—In any case in 

11 which cannabis products are lost or destroyed, 

12 whether by theft or otherwise, the Secretary 

13 may require the proprietor of a cannabis pro14 duction facility or other person liable for the 

15 tax to file a claim for relief from the tax and 

16 submit proof as to the cause of such loss. In 

17 every case where it appears that the loss was by 

18 theft, the burden shall be upon the proprietor 

19 of the cannabis production facility or other per20 son responsible for the tax under section 5901 

21 to establish to the satisfaction of the Secretary 

22 that such loss did not occur as the result of 

23 connivance, collusion, fraud, or negligence on 

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1 duction facility, owner, consignor, consignee, 

2 bailee, or carrier, or their employees or agents. 

3 ‘‘(C) REFUND OF TAX.—In any case where 

4 the tax would not be collectible by virtue of sub5 paragraph (A), but such tax has been paid, the 

6 Secretary shall refund such tax. 

7 ‘‘(D) LIMITATIONS.—Except as provided in 

8 subparagraph (E), no tax shall be abated, re9 mitted, credited, or refunded under this para10 graph where the loss occurred after the tax was 

11 determined. The abatement, remission, credit, 

12 or refund of taxes provided for by subpara13 graphs (A) and (C) in the case of loss of can14 nabis products by theft shall only be allowed to 

15 the extent that the claimant is not indemnified 

16 against or recompensed in respect of the tax for 

17 such loss. 

18 ‘‘(E) APPLICABILITY.—The provisions of 

19 this paragraph shall extend to and apply in re20 spect of cannabis products lost after the tax 

21 was determined and before completion of the 

22 physical removal of the cannabis products from 

23 the bonded premises. 

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1 sons liable for the tax imposed by this chapter or by 

2 section 7652 with respect to any cannabis product in 

3 bond may voluntarily destroy such products, but 

4 only if such destruction is under such supervision 

5 and under such regulations as the Secretary may 

6 prescribe. 

7 ‘‘(4) LIMITATION.—Any claim for credit or re8 fund of tax under this subsection shall be filed with9 in 6 months after the date of the withdrawal from 

10 the market, loss, or destruction of the products to 

11 which the claim relates, and shall be in such form 

12 and contain such information as the Secretary shall 

13 by regulations prescribe. 

14 ‘‘(b) DRAWBACK OF TAX.—There shall be an allow15 ance of drawback of tax paid on cannabis products, when 

16 shipped from the United States, in accordance with such 

17 regulations and upon the filing of such bond as the Sec18 retary shall prescribe. 

19 ‘‘Subchapter B—Occupational Tax 

‘‘Sec. 5911. Imposition and rate of tax. 

‘‘Sec. 5912. Payment of tax. 

‘‘Sec. 5913. Provisions relating to liability for occupational taxes. 

‘‘Sec. 5914. Application to State laws. 

20 ‘‘SEC. 5911. IMPOSITION AND RATE OF TAX. 

21 ‘‘(a) IN GENERAL.—Any person engaged in business 

22 as a producer or an export warehouse proprietor shall pay 

23 a tax of $1,000 per year (referred to in this subchapter 


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1 as an ‘occupational tax’) in respect of each premises at 

2 which such business is carried on. 

3 ‘‘(b) PENALTY FOR FAILURE TO REGISTER.—Any 

4 person engaged in business as a producer or an export 

5 warehouse proprietor who willfully fails to pay the occupa6 tion tax shall be fined not more than $5,000, or impris7 oned not more than 2 years, or both, for each such offense. 

8 ‘‘SEC. 5912. PAYMENT OF TAX. 

9 ‘‘(a) CONDITION PRECEDENT TO CARRYING ON

10 BUSINESS.—No person shall be engaged in or carry on 

11 any trade or business subject to the occupational tax until 

12 such person has paid such tax. 

13 ‘‘(b) COMPUTATION.— 

14 ‘‘(1) IN GENERAL.—The occupational tax shall 

15 be imposed— 

16 ‘‘(A) as of on the first day of July in each 

17 year, or 

18 ‘‘(B) on commencing any trade or business 

19 on which such tax is imposed. 

20 ‘‘(2) PERIOD.—In the case of a tax imposed 

21 under subparagraph (A) of paragraph (1), the occu22 pational tax shall be reckoned for 1 year, and in the 

23 case of subparagraph (B) of such paragraph, it shall 

24 be reckoned proportionately, from the first day of 

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1 menced, to and including the 30th day of June fol2 lowing. 

3 ‘‘(c) METHOD OF PAYMENT.— 

4 ‘‘(1) PAYMENT BY RETURN.—The occupational 

5 tax shall be paid on the basis of a return under such 

6 regulations as the Secretary shall prescribe. 

7 ‘‘(2) STAMP DENOTING PAYMENT OF TAX.— 

8 After receiving a properly executed return and re9 mittance of any occupational tax, the Secretary shall 

10 issue to the taxpayer an appropriate stamp as a re11 ceipt denoting payment of the tax. This paragraph 

12 shall not apply in the case of a return covering li13 ability for a past period. 

14 ‘‘SEC. 5913. PROVISIONS RELATING TO LIABILITY FOR OC15 CUPATIONAL TAXES. 

16 ‘‘(a) PARTNERS.—Any number of persons doing busi17 ness in partnership at any one place shall be required to 

18 pay a single occupational tax. 

19 ‘‘(b) DIFFERENT BUSINESSES OF SAME OWNERSHIP

20 AND LOCATION.—Whenever more than one of the pursuits 

21 or occupations described in this subchapter are carried on 

22 in the same place by the same person at the same time, 

23 except as otherwise provided in this subchapter, the occu24 pational tax shall be paid for each according to the rates 

25 severally prescribed. 


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1 ‘‘(c) BUSINESSES IN MORE THAN ONE LOCATION.— 

2 ‘‘(1) LIABILITY FOR TAX.—The payment of the 

3 occupational tax shall not exempt from an additional 

4 occupational tax the person carrying on a trade or 

5 business in any other place than that stated in the 

6 records of the Internal Revenue Service. 

7 ‘‘(2) STORAGE.—Nothing contained in para8 graph (1) shall require imposition of an occupational 

9 tax for the storage of cannabis products at a loca10 tion other than the place where such products are 

11 sold or offered for sale. 

12 ‘‘(3) PLACE.— 

13 ‘‘(A) IN GENERAL.—For purposes of this 

14 section, the term ‘place’ means the entire office, 

15 plant or area of the business in any one loca16 tion under the same proprietorship. 

17 ‘‘(B) DIVISIONS.—For purposes of this 

18 paragraph, any passageways, streets, highways, 

19 rail crossings, waterways, or partitions dividing 

20 the premises shall not be deemed sufficient sep21 aration to require an additional occupational 

22 tax, if the various divisions are otherwise con23 tiguous. 

24 ‘‘(d) DEATH OR CHANGE OF LOCATION.— 


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1 ‘‘(1) IN GENERAL.—In addition to the person 

2 who has paid the occupational tax for the carrying 

3 on of any business at any place, any person de4 scribed in paragraph (2) may secure the right to 

5 carry on, without incurring any additional occupa6 tional tax, the same business at the same place for 

7 the remainder of the taxable period for which the oc8 cupational tax was paid. 

9 ‘‘(2) ELIGIBLE PERSONS.—The persons de10 scribed in this paragraph are the following: 

11 ‘‘(A) The surviving spouse or child, or ex12 ecutor or administrator or other legal represent13 ative, of a deceased taxpayer. 

14 ‘‘(B) A husband or wife succeeding to the 

15 business of his or her living spouse. 

16 ‘‘(C) A receiver or trustee in bankruptcy, 

17 or an assignee for benefit of creditors. 

18 ‘‘(D) The partner or partners remaining 

19 after death or withdrawal of a member of a 

20 partnership. 

21 ‘‘(3) CHANGE OF LOCATION.—When any person 

22 moves to any place other than the place for which 

23 occupational tax was paid for the carrying on of any 

24 business, such person may secure the right to carry 

25 on, without incurring additional occupational tax, 


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1 the same business at the new location for the re2 mainder of the taxable period for which the occupa3 tional tax was paid. To secure the right to carry on 

4 the business without incurring additional occupa5 tional tax, the successor, or the person relocating 

6 their business, must register the succession or relo7 cation with the Secretary in accordance with regula8 tions prescribed by the Secretary. 

9 ‘‘(e) FEDERAL AGENCIES OR INSTRUMENTAL10 ITIES.—Any tax imposed by this subchapter shall apply 

11 to any agency or instrumentality of the United States un12 less such agency or instrumentality is granted by statute 

13 a specific exemption from such tax. 

14 ‘‘SEC. 5914. APPLICATION TO STATE LAWS. 

15 ‘‘The payment of any tax imposed by this subchapter 

16 for carrying on any trade or business shall not be held 

17 to— 

18 ‘‘(1) exempt any person from any penalty or 

19 punishment provided by the laws of any State for 

20 carrying on such trade or business within such 

21 State, or in any manner to authorize the commence22 ment or continuance of such trade or business con23 trary to the laws of such State or in places prohib24 ited by municipal law, or 


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1 ‘‘(2) prohibit any State from placing a duty or 

2 tax on the same trade or business, for State or other 

3 purposes. 

4 ‘‘Subchapter C—Bond and Permits 

‘‘Sec. 5921. Establishment and bond. 

‘‘Sec. 5922. Application for permit. 

‘‘Sec. 5923. Permit. 

5 ‘‘SEC. 5921. ESTABLISHMENT AND BOND. 

6 ‘‘(a) PROHIBITION ON PRODUCTION OUTSIDE OF

7 BONDED CANNABIS PRODUCTION FACILITY.— 

8 ‘‘(1) IN GENERAL.—Except as authorized by 

9 the Secretary or on the bonded premises of a can10 nabis production facility duly authorized to produce 

11 cannabis products according to law, no cannabis 

12 product may planted, cultivated, harvested, grown, 

13 manufactured, produced, compounded, converted, 

14 processed, prepared, or packaged in any building or 

15 on any premises. 

16 ‘‘(2) AUTHORIZED PRODUCERS ONLY.—No per17 son other than a producer which has filed the bond 

18 required under subsection (b) and received a permit 

19 described in section 5923 may produce any cannabis 

20 product. 

21 ‘‘(3) PERSONAL USE EXCEPTION.—This sub22 section shall not apply with respect the activities of 

23 an individual who is not treated as a producer by 

24 reason of section 5902(b)(2)(B). 


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1 ‘‘(b) BOND.— 

2 ‘‘(1) WHEN REQUIRED.—Every person, before 

3 commencing business as a producer or an export 

4 warehouse proprietor, shall file such bond, condi5 tioned upon compliance with this chapter and regu6 lations issued thereunder, in such form, amount, and 

7 manner as the Secretary shall by regulation pre8 scribe. A new or additional bond may be required 

9 whenever the Secretary considers such action nec10 essary for the protection of the revenue. 

11 ‘‘(2) APPROVAL OR DISAPPROVAL.—No person 

12 shall engage in such business until he receives notice 

13 of approval of such bond. A bond may be dis14 approved, upon notice to the principal on the bond, 

15 if the Secretary determines that the bond is not ade16 quate to protect the revenue. 

17 ‘‘(3) CANCELLATION.—Any bond filed here18 under may be canceled, upon notice to the principal 

19 on the bond, whenever the Secretary determines that 

20 the bond no longer adequately protects the revenue. 

21 ‘‘SEC. 5922. APPLICATION FOR PERMIT. 

22 ‘‘(a) IN GENERAL.—Every person, before com23 mencing business as a cannabis enterprise, and at such 

24 other time as the Secretary shall by regulation prescribe, 

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1 tion 5923. The application shall be in such form as the 

2 Secretary shall prescribe and shall set forth, truthfully and 

3 accurately, the information called for on the form. Such 

4 application may be rejected and the permit denied if the 

5 Secretary, after notice and opportunity for hearing, finds 

6 that— 

7 ‘‘(1) the premises on which it is proposed to 

8 conduct the cannabis enterprise are not adequate to 

9 protect the revenue, or 

10 ‘‘(2) such person (including, in the case of a 

11 corporation, any officer, director, or principal stock12 holder and, in the case of a partnership, a partner) 

13 has failed to disclose any material information re14 quired or made any material false statement in the 

15 application therefor. 

16 ‘‘SEC. 5923. PERMIT. 

17 ‘‘(a) ISSUANCE.—A person shall not engage in busi18 ness as a cannabis enterprise without a permit to engage 

19 in such business. Such permit, conditioned upon compli20 ance with this chapter and regulations issued thereunder, 

21 shall be issued in such form and in such manner as the 

22 Secretary shall by regulation prescribe. A new permit may 

23 be required at such other time as the Secretary shall by 

24 regulation prescribe. 

25 ‘‘(b) SUSPENSION OR REVOCATION.— 


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1 ‘‘(1) SHOW CAUSE HEARING.—If the Secretary 

2 has reason to believe that any person holding a per3 mit— 

4 ‘‘(A) has not in good faith complied with 

5 this chapter, or with any other provision of this 

6 title involving intent to defraud, 

7 ‘‘(B) has violated the conditions of such 

8 permit, 

9 ‘‘(C) has failed to disclose any material in10 formation required or made any material false 

11 statement in the application for such permit, or 

12 ‘‘(D) has failed to maintain their premises 

13 in such manner as to protect the revenue, 

14 the Secretary shall issue an order, stating the facts 

15 charged, citing such person to show cause why their 

16 permit should not be suspended or revoked. 

17 ‘‘(2) ACTION FOLLOWING HEARING.—If, after 

18 hearing, the Secretary finds that such person has 

19 not shown cause why their permit should not be sus20 pended or revoked, such permit shall be suspended 

21 for such period as the Secretary deems proper or 

22 shall be revoked. 

23 ‘‘(c) INFORMATION REPORTING.—The Secretary may 

24 require— 


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1 ‘‘(1) information reporting by any person issued 

2 a permit under this section, and 

3 ‘‘(2) information reporting by such other per4 sons as the Secretary deems necessary to carry out 

5 this chapter. 

6 ‘‘(d) INSPECTION OR DISCLOSURE OF INFORMA7 TION.—For rules relating to inspection and disclosure of 

8 returns and return information, see section 6103(o). 

9 ‘‘Subchapter D—Operations 

‘‘Sec. 5931. Inventories, reports, and records. 

‘‘Sec. 5932. Packaging and labeling. 

‘‘Sec. 5933. Purchase, receipt, possession, or sale of cannabis products after removal. 

‘‘Sec. 5934. Restrictions relating to marks, labels, notices, and packages. 

‘‘Sec. 5935. Restriction on importation of previously exported cannabis products. 

10 ‘‘SEC. 5931. INVENTORIES, REPORTS, AND RECORDS. 

11 ‘‘Every cannabis enterprise shall— 

12 ‘‘(1) make a true and accurate inventory at the 

13 time of commencing business, at the time of con14 cluding business, and at such other times, in such 

15 manner and form, and to include such items, as the 

16 Secretary shall by regulation prescribe, with such in17 ventories to be subject to verification by any internal 

18 revenue officer, 

19 ‘‘(2) make reports containing such information, 

20 in such form, at such times, and for such periods as 

21 the Secretary shall by regulation prescribe, and 


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1 ‘‘(3) keep such records in such manner as the 

2 Secretary shall by regulation prescribe, with such 

3 records to be available for inspection by any internal 

4 revenue officer during business hours. 

5 ‘‘SEC. 5932. PACKAGING AND LABELING. 

6 ‘‘(a) PACKAGES.—All cannabis products shall, before 

7 removal, be put up in such packages as the Secretary shall 

8 by regulation prescribe. 

9 ‘‘(b) MARKS, LABELS, AND NOTICES.—Every pack10 age of cannabis products shall, before removal, bear the 

11 marks, labels, and notices if any, that the Secretary by 

12 regulation prescribes. 

13 ‘‘(c) LOTTERY FEATURES.—No certificate, coupon, 

14 or other device purporting to be or to represent a ticket, 

15 chance, share, or an interest in, or dependent on, the event 

16 of a lottery shall be contained in, attached to, or stamped, 

17 marked, written, or printed on any package of cannabis 

18 products. 

19 ‘‘(d) INDECENT OR IMMORAL MATERIAL PROHIB20 ITED.—No indecent or immoral picture, print, or rep21 resentation shall be contained in, attached to, or stamped, 

22 marked, written, or printed on any package of cannabis 

23 products. 


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1 ‘‘(e) EXCEPTIONS.—Subject to regulations prescribed 

2 by the Secretary, cannabis products may be exempted 

3 from subsections (a) and (b) if such products are— 

4 ‘‘(1) for experimental purposes, or 

5 ‘‘(2) transferred to the bonded premises of an6 other producer or export warehouse proprietor or re7 leased in bond from customs custody for delivery to 

8 a producer. 

9 ‘‘SEC. 5933. PURCHASE, RECEIPT, POSSESSION, OR SALE OF 

10 CANNABIS PRODUCTS AFTER REMOVAL. 

11 ‘‘(a) RESTRICTION.—No person shall— 

12 ‘‘(1) with intent to defraud the United States, 

13 purchase, receive, possess, offer for sale, or sell or 

14 otherwise dispose of, after removal, any cannabis 

15 products— 

16 ‘‘(A) upon which the tax has not been paid 

17 or determined in the manner and at the time 

18 prescribed by this chapter or regulations there19 under, or 

20 ‘‘(B) which, after removal without payment 

21 of tax pursuant to section 5904(a), have been 

22 diverted from the applicable purpose or use 

23 specified in that section, 

24 ‘‘(2) with intent to defraud the United States, 

25 purchase, receive, possess, offer for sale, or sell or 


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1 otherwise dispose of, after removal, any cannabis 

2 products which are not put up in packages as re3 quired under section 5932 or which are put up in 

4 packages not bearing the marks, labels, and notices, 

5 as required under such section, or 

6 ‘‘(3) otherwise than with intent to defraud the 

7 United States, purchase, receive, possess, offer for 

8 sale, or sell or otherwise dispose of, after removal, 

9 any cannabis products which are not put up in pack10 ages as required under section 5932 or which are 

11 put up in packages not bearing the marks, labels, 

12 and notices, as required under such section. 

13 ‘‘(b) EXCEPTION.—Paragraph (3) of subsection (a) 

14 shall not prevent the sale or delivery of cannabis products 

15 directly to consumers from proper packages, nor apply to 

16 such articles when so sold or delivered. 

17 ‘‘(c) LIABILITY TO TAX.—Any person who possesses 

18 cannabis products in violation of paragraph (1) or (2) of 

19 subsection (a) shall be liable for a tax equal to the tax 

20 on such articles. 

21 ‘‘SEC. 5934. RESTRICTIONS RELATING TO MARKS, LABELS, 

22 NOTICES, AND PACKAGES. 

23 ‘‘No person shall, with intent to defraud the United 

24 States, destroy, obliterate, or detach any mark, label, or 

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1 tions thereunder, to appear on, or be affixed to, any pack2 age of cannabis products before such package is emptied. 

3 ‘‘SEC. 5935. RESTRICTION ON IMPORTATION OF PRE4 VIOUSLY EXPORTED CANNABIS PRODUCTS. 

5 ‘‘(a) EXPORT LABELED CANNABIS PRODUCTS.— 

6 ‘‘(1) IN GENERAL.—Cannabis products pro7 duced in the United States and labeled for expor8 tation under this chapter— 

9 ‘‘(A) may be transferred to or removed 

10 from the premises of a producer or an export 

11 warehouse proprietor only if such articles are 

12 being transferred or removed without tax in ac13 cordance with section 5904, 

14 ‘‘(B) may be imported or brought into the 

15 United States, after their exportation, only if 

16 such articles either are eligible to be released 

17 from customs custody with the partial duty ex18 emption provided in section 5904(d) or are re19 turned to the original producer of such article 

20 as provided in section 5904(c), and 

21 ‘‘(C) may not be sold or held for sale for 

22 domestic consumption in the United States un23 less such articles are removed from their export 

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1 ducer into new packaging that does not contain 

2 an export label. 

3 ‘‘(2) ALTERATIONS BY PERSONS OTHER THAN

4 ORIGINAL PRODUCER.—This section shall apply to 

5 articles labeled for export even if the packaging or 

6 the appearance of such packaging to the consumer 

7 of such articles has been modified or altered by a 

8 person other than the original producer so as to re9 move or conceal or attempt to remove or conceal (in10 cluding by the placement of a sticker over) any ex11 port label. 

12 ‘‘(3) EXPORTS INCLUDE SHIPMENTS TO PUER13 TO RICO.—For purposes of this section, section 

14 5904(d), section 5941, and such other provisions as 

15 the Secretary may specify by regulations, references 

16 to exportation shall be treated as including a ref17 erence to shipment to the Commonwealth of Puerto 

18 Rico. 

19 ‘‘(b) EXPORT LABEL.—For purposes of this section, 

20 an article is labeled for export or contains an export label 

21 if it bears the mark, label, or notice required under section 

22 5904(b). 

23 ‘‘Subchapter E—Penalties 

‘‘Sec. 5941. Civil penalties. 

‘‘Sec. 5942. Criminal penalties. 


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1 ‘‘SEC. 5941. CIVIL PENALTIES. 

2 ‘‘(a) OMITTING THINGS REQUIRED OR DOING

3 THINGS FORBIDDEN.—Whoever willfully omits, neglects, 

4 or refuses to comply with any duty imposed upon them 

5 by this chapter, or to do, or cause to be done, any of the 

6 things required by this chapter, or does anything prohib7 ited by this chapter, shall in addition to any other penalty 

8 provided in this title, be liable to a penalty of $10,000, 

9 to be recovered, with costs of suit, in a civil action, except 

10 where a penalty under subsection (b) or (c) or under sec11 tion 6651 or 6653 or part II of subchapter A of chapter 

12 68 may be collected from such person by assessment. 

13 ‘‘(b) FAILURE TO PAY TAX.—Whoever fails to pay 

14 any tax imposed by this chapter at the time prescribed 

15 by law or regulations, shall, in addition to any other pen16 alty provided in this title, be liable to a penalty of 10 per17 cent of the tax due but unpaid. 

18 ‘‘(c) SALE OF CANNABIS OR CANNABIS PRODUCTS

19 FOR EXPORT.— 

20 ‘‘(1) Every person who sells, relands, or receives 

21 within the jurisdiction of the United States any can22 nabis products which have been labeled or shipped 

23 for exportation under this chapter, 

24 ‘‘(2) every person who sells or receives such re25 landed cannabis products, and 


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1 ‘‘(3) every person who aids or abets in such 

2 selling, relanding, or receiving, 

3 shall, in addition to the tax and any other penalty provided 

4 in this title, be liable for a penalty equal to the greater 

5 of $10,000 or 10 times the amount of the tax imposed 

6 by this chapter. All cannabis products relanded within the 

7 jurisdiction of the United States shall be forfeited to the 

8 United States and destroyed. All vessels, vehicles, and air9 craft used in such relanding or in removing such cannabis 

10 products from the place where relanded, shall be forfeited 

11 to the United States. 

12 ‘‘(d) APPLICABILITY OF SECTION 6665.—The pen13 alties imposed by subsections (b) and (c) shall be assessed, 

14 collected, and paid in the same manner as taxes, as pro15 vided in section 6665(a). 

16 ‘‘(e) CROSS REFERENCES.—For penalty for failure to 

17 make deposits or for overstatement of deposits, see section 

18 6656. 

19 ‘‘SEC. 5942. CRIMINAL PENALTIES. 

20 ‘‘(a) FRAUDULENT OFFENSES.—Whoever, with in21 tent to defraud the United States— 

22 ‘‘(1) engages in business as a cannabis enter23 prise without filing the application and obtaining the 

24 permit where required by this chapter or regulations 

25 thereunder, 


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1 ‘‘(2) fails to keep or make any record, return, 

2 report, or inventory, or keeps or makes any false or 

3 fraudulent record, return, report, or inventory, re4 quired by this chapter or regulations thereunder, 

5 ‘‘(3) refuses to pay any tax imposed by this 

6 chapter, or attempts in any manner to evade or de7 feat the tax or the payment thereof, 

8 ‘‘(4) sells or otherwise transfers, contrary to 

9 this chapter or regulations thereunder, any cannabis 

10 products subject to tax under this chapter, or 

11 ‘‘(5) purchases, receives, or possesses, with in12 tent to redistribute or resell, any cannabis product— 

13 ‘‘(A) upon which the tax has not been paid 

14 or determined in the manner and at the time 

15 prescribed by this chapter or regulations there16 under, or 

17 ‘‘(B) which, without payment of tax pursu18 ant to section 5904, have been diverted from 

19 the applicable purpose or use specified in that 

20 section, 

21 shall, for each such offense, be fined not more than 

22 $10,000, or imprisoned not more than 5 years, or both. 

23 ‘‘(b) LIABILITY TO TAX.—Any person who possesses 

24 cannabis products in violation of subsection (a) shall be 

25 liable for a tax equal to the tax on such articles.’’. 


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1 (c) STUDY.—Not later than 2 years after the date 

2 of the enactment of this Act, and every 5 years thereafter, 

3 the Secretary of the Treasury, or the Secretary’s delegate, 

4 shall— 

5 (1) conduct a study concerning the characteris6 tics of the cannabis industry, including the number 

7 of persons operating cannabis enterprises at each 

8 level of such industry, the volume of sales, the 

9 amount of tax collected each year, and the areas of 

10 evasion, and 

11 (2) submit to Congress recommendations to im12 prove the regulation of the industry and the admin13 istration of the related tax. 

14 (d) ANNUAL REPORTS REGARDING DETERMINATION

15 OF APPLICABLE RATES.—Not later than 6 months before 

16 the beginning of each calendar year to which section 

17 5901(a)(2) of the Internal Revenue Code of 1986 (as 

18 added by this section) applies, the Secretary of the Treas19 ury, or the Secretary’s delegate, shall make publicly avail20 able a detailed description of the methodology which the 

21 Secretary anticipates using to determine the applicable 

22 rate per ounce and the applicable rate per gram which 

23 will apply for such calendar year under section 5901(c)(2) 

24 of such Code. 

25 (e) CONFORMING AMENDMENTS.— 


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1 (1) Section 6103(o)(1)(A) of the Internal Rev2 enue Code of 1986 is amended by striking ‘‘and fire3 arms’’ and inserting ‘‘firearms, and cannabis prod4 ucts’’. 

5 (2) The table of chapters for subtitle E of such 

6 Code is amended by adding at the end the following 

7 new item: 

‘‘CHAPTER 56. CANNABIS PRODUCTS’’. 

8 (3) The table of sections for subchapter A of 

9 chapter 98 of such Code is amended by adding at 

10 the end the following new item: 

‘‘Sec. 9512. Opportunity Trust Tund.’’. 

11 (f) EFFECTIVE DATE.— 

12 (1) IN GENERAL.—Except as otherwise pro13 vided in this subsection, the amendments made by 

14 this section shall apply to removals, and applications 

15 for permits under section 5922 of the Internal Rev16 enue Code of 1986 (as added by subsection (b)), 

17 after 180 days after the date of the enactment of 

18 this Act. 

19 (2) ESTABLISHMENT OF TRUST FUND.—The 

20 amendment made by subsection (a) shall take effect 

21 on the date of the enactment of this Act. 

22 SEC. 6. OPPORTUNITY TRUST FUND PROGRAMS. 

23 (a) CANNABIS JUSTICE OFFICE; COMMUNITY REIN24 VESTMENT GRANT PROGRAM.— 


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1 (1) CANNABIS JUSTICE OFFICE.—Part A of 

2 title I of the Omnibus Crime Control and Safe 

3 Streets Act of 1968 (34 U.S.C. 10101 et seq.) is 

4 amended by inserting after section 109 the fol5 lowing: 

6 ‘‘SEC. 110. CANNABIS JUSTICE OFFICE. 

7 ‘‘(a) ESTABLISHMENT.—There is established within 

8 the Office of Justice Programs a Cannabis Justice Office. 

9 ‘‘(b) DIRECTOR.—The Cannabis Justice Office shall 

10 be headed by a Director who shall be appointed by the 

11 Assistant Attorney General for the Office of Justice Pro12 grams. The Director shall report to the Assistant Attorney 

13 General for the Office of Justice Programs. The Director 

14 shall award grants and may enter into compacts, coopera15 tive agreements, and contracts on behalf of the Cannabis 

16 Justice Office. The Director may not engage in any em17 ployment other than that of serving as the Director, nor 

18 may the Director hold any office in, or act in any capacity 

19 for, any organization, agency, or institution with which the 

20 Office makes any contract or other arrangement. 

21 ‘‘(c) EMPLOYEES.— 

22 ‘‘(1) IN GENERAL.—The Director shall employ 

23 as many full-time employees as are needed to carry 

24 out the duties and functions of the Cannabis Justice 


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1 Office under subsection (d). Such employees shall be 

2 exclusively assigned to the Cannabis Justice Office. 

3 ‘‘(2) INITIAL HIRES.—Not later than 6 months 

4 after the date of enactment of this section, the Di5 rector shall— 

6 ‘‘(A) hire no less than one-third of the 

7 total number of employees of the Cannabis Jus8 tice Office; and 

9 ‘‘(B) no more than one-half of the employ10 ees assigned to the Cannabis Justice Office by 

11 term appointment that may after 2 years be 

12 converted to career appointment. 

13 ‘‘(3) LEGAL COUNSEL.—At least one employee 

14 hired for the Cannabis Justice Office shall serve as 

15 legal counsel to the Director and shall provide coun16 sel to the Cannabis Justice Office. 

17 ‘‘(d) DUTIES AND FUNCTIONS.—The Cannabis Jus18 tice Office is authorized to— 

19 ‘‘(1) administer the Community Reinvestment 

20 Grant Program; and 

21 ‘‘(2) perform such other functions as the Assist22 ant Attorney General for the Office of Justice Pro23 grams may delegate, that are consistent with the 

24 statutory obligations of this section.’’. 


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1 (2) COMMUNITY REINVESTMENT GRANT PRO2 GRAM.—Title I of the Omnibus Crime Control and 

3 Safe Streets Act of 1968 (34 U.S.C. et seq.) is 

4 amended by adding at the end the following: 

5 ‘‘PART OO—COMMUNITY REINVESTMENT GRANT 

6 PROGRAM 

7 ‘‘SEC. 3052. AUTHORIZATION. 

8 ‘‘(a) IN GENERAL.—The Director of the Cannabis 

9 Justice Office shall establish and carry out a grant pro10 gram, known as the ‘Community Reinvestment Grant Pro11 gram’, to provide eligible entities with funds to administer 

12 services for individuals adversely impacted by the War on 

13 Drugs, including— 

14 ‘‘(1) job training; 

15 ‘‘(2) reentry services; 

16 ‘‘(3) legal aid for civil and criminal cases, in17 cluding expungement of cannabis convictions; 

18 ‘‘(4) literacy programs; 

19 ‘‘(5) youth recreation or mentoring programs; 

20 and 

21 ‘‘(6) health education programs. 

22 ‘‘(b) SUBSTANCE USE DISORDER SERVICES.—The 

23 Director, in consultation with the Secretary of Health and 

24 Human Services, shall provide eligible entities with funds 

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1 uals adversely impacted by the War on Drugs or connect 

2 patients with substance use disorder services. Also eligible 

3 for such services are individuals who have been arrested 

4 for or convicted of the sale, possession, use, manufacture, 

5 or cultivation of a controlled substance other than can6 nabis (except for a conviction involving distribution to a 

7 minor). 

8 ‘‘SEC. 3053. FUNDING FROM OPPORTUNITY TRUST FUND. 

9 ‘‘The Director shall carry out the program under this 

10 part using funds made available under section 9512(c)(1) 

11 and (2) of the Internal Revenue Code. 

12 ‘‘SEC. 3054. DEFINITIONS. 

13 ‘‘In this part: 

14 ‘‘(1) The term ‘cannabis conviction’ means a 

15 conviction, or adjudication of juvenile delinquency, 

16 for a cannabis offense (as such term is defined in 

17 section 13 of the Marijuana Opportunity Reinvest18 ment and Expungement Act of 2021). 

19 ‘‘(2) The term ‘eligible entity’ means a non20 profit organization, as defined in section 501(c)(3) 

21 of the Internal Revenue Code, that is representative 

22 of a community or a significant segment of a com23 munity with experience in providing relevant services 

24 to individuals adversely impacted by the War on 

25 Drugs in that community. 


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1 ‘‘(3) The term ‘individuals adversely impacted 

2 by the War on Drugs’ has the meaning given that 

3 term in section 6 of the Marijuana Opportunity Re4 investment and Expungement Act of 2021’’.’’. 

5 (b) CANNABIS RESTORATIVE OPPORTUNITY PRO6 GRAM; EQUITABLE LICENSING GRANT PROGRAM.— 

7 (1) CANNABIS RESTORATIVE OPPORTUNITY

8 PROGRAM.—The Administrator of the Small Busi9 ness Administration shall establish and carry out a 

10 program, to be known as the ‘‘Cannabis Restorative 

11 Opportunity Program’’, to provide loans and tech12 nical assistance under section 7(m) of the Small 

13 Business Act (15 U.S.C. 636(m)) to assist small 

14 business concerns owned and controlled by socially 

15 and economically disadvantaged individuals that op16 erate in eligible States or localities. 

17 (2) EQUITABLE LICENSING GRANT PROGRAM.— 

18 The Administrator of the Small Business Adminis19 tration shall establish and carry out a grant pro20 gram, to be known as the ‘‘Equitable Licensing 

21 Grant Program’’, to provide any eligible State or lo22 cality funds to develop and implement equitable can23 nabis licensing programs that minimize barriers to 

24 cannabis licensing and employment for individuals 

25 adversely impacted by the War on Drugs, provided 


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1 that each grantee includes in its cannabis licensing 

2 program at least four of the following elements: 

3 (A) A waiver of cannabis license applica4 tion fees for individuals who report an income 

5 below 250 percent of the Federal Poverty Level 

6 for at least 5 of the past 10 years and who are 

7 first-time applicants for a cannabis license. 

8 (B) A prohibition on the denial of a can9 nabis license based on a conviction for a can10 nabis offense that took place prior to State le11 galization of cannabis or the date of enactment 

12 of this Act, as appropriate. 

13 (C) A prohibition on restrictions for licens14 ing relating to criminal convictions except with 

15 respect to a criminal conviction related to own16 ing and operating a business. 

17 (D) A prohibition on cannabis license hold18 ers engaging in suspicionless cannabis drug 

19 testing of their prospective or current employ20 ees, except with respect to drug testing for safe21 ty-sensitive positions required under part 40 of 

22 title 49, Code of Federal Regulations. 

23 (E) The establishment of a cannabis li24 censing board that is reflective of the racial, 

25 ethnic, economic, and gender composition of the 


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1 eligible State or locality, to serve as an over2 sight body of the equitable licensing program. 

3 (3) DEFINITIONS.—In this subsection: 

4 (A) ELIGIBLE STATE OR LOCALITY.—The 

5 term ‘‘eligible State or locality’’ means a State 

6 or locality that has taken steps to— 

7 (i) create an automatic process, at no 

8 cost to the individual, for the 

9 expungement, destruction, or sealing of 

10 criminal records for cannabis offenses; and 

11 (ii) eliminate violations or other pen12 alties for persons under parole, probation, 

13 pre-trial, or other State or local criminal 

14 supervision for a cannabis offense. 

15 (B) INDIVIDUAL ADVERSELY IMPACTED BY

16 THE WAR ON DRUGS.—The term ‘‘individual 

17 adversely impacted by the War on Drugs’’ 

18 means an individual— 

19 (i) who reports an income below 250 

20 percent of the Federal Poverty Level for at 

21 least 5 of the past 10 years; and 

22 (ii) who has been arrested for or con23 victed of the sale, possession, use, manu24 facture, or cultivation of cannabis (except 

25 for a conviction involving distribution to a 


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1 minor), or whose parent, sibling, spouse, or 

2 child has been arrested for or convicted of 

3 such an offense. 

4 (C) SMALL BUSINESS CONCERN OWNED

5 AND CONTROLLED BY SOCIALLY AND ECONOMI6 CALLY DISADVANTAGED INDIVIDUALS.—The 

7 term ‘‘small business concern owned and con8 trolled by socially and economically disadvan9 taged individuals’’ has the meaning given in 

10 section 8(d)(3)(C) of the Small Business Act 

11 (15 U.S.C. 637(d)(3)(C)). 

12 (D) STATE.—The term ‘‘State’’ means 

13 each of the several States, the District of Co14 lumbia, Puerto Rico, any territory or possession 

15 of the United States, and any Indian Tribe (as 

16 defined in section 201 of Public Law 90–294 

17 (25 U.S.C. 1301) (commonly known as the ‘‘In18 dian Civil Rights Act of 1968’’)). 

19 (c) STUDY ON PROGRAMS.— 

20 (1) GAO STUDY.—The Comptroller General of 

21 the United States, in consultation with the Adminis22 trator of the Small Business Administration, shall 

23 conduct an annual study on the individuals and enti24 ties receiving assistance under the Cannabis Restor25 ative Opportunity and Equitable Licensing ProVerDate Sep 11 2014 06:18 Jul 03, 2021 Jkt 019200 PO 00000 Frm 00069 Fmt 6652 Sfmt 6201 E:\BILLS\H3617.IH H3617

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1 grams. This study shall include the types of assist2 ance by state, and a description of the efforts by the 

3 Small Business Administration to increase access to 

4 capital for cannabis-related small business concerns 

5 owned and controlled by socially and economically 

6 disadvantaged individuals, individuals adversely im7 pacted by the War on Drugs, as well as the racial, 

8 ethnic, economic and gender composition of the eligi9 ble State or locality. 

10 (2) REPORT.—Not later than 1 year after the 

11 date of enactment of this Act, the Comptroller Gen12 eral of the United States shall submit a report on 

13 the results of the study conducted under paragraph 

14 (1) to— 

15 (A) the Committee on Small Business of 

16 the House of Representatives; 

17 (B) the Committee on Small Business and 

18 Entrepreneurship of the Senate; 

19 (C) the Committee on the Judiciary of the 

20 House of Representatives; and 

21 (D) the Committee on the Judiciary of the 

22 Senate. 


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1 SEC. 7. AVAILABILITY OF SMALL BUSINESS ADMINISTRA2 TION PROGRAMS AND SERVICES TO CAN3 NABIS-RELATED LEGITIMATE BUSINESSES 

4 AND SERVICE PROVIDERS. 

5 (a) DEFINITIONS RELATING TO CANNABIS-RELATED

6 LEGITIMATE BUSINESSES AND SERVICE PROVIDERS.— 

7 Section 3 of the Small Business Act (15 U.S.C. 632) is 

8 amended by adding at the end the following new sub9 section: 

10 ‘‘(gg) CANNABIS-RELATED LEGITIMATE BUSINESSES

11 AND SERVICE PROVIDERS.—In this Act: 

12 ‘‘(1) CANNABIS.—The term ‘cannabis’— 

13 ‘‘(A) means— 

14 ‘‘(i) all parts of the plant Cannabis 

15 sativa L., whether growing or not; 

16 ‘‘(ii) the seeds thereof; 

17 ‘‘(iii) the resin extracted from any 

18 part of such plant; and 

19 ‘‘(iv) every compound, manufacture, 

20 salt, derivative, mixture, or preparation of 

21 such plant, its seeds or resin; and 

22 ‘‘(B) does not include— 

23 ‘‘(i) hemp, as defined in section 297A 

24 of the Agricultural Marketing Act of 1946; 

25 ‘‘(ii) the mature stalks of such plant, 

26 fiber produced from such stalks, oil or cake 


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1 made from the seeds of such plant, any 

2 other compound, manufacture, salt, deriva3 tive, mixture, or preparation of such ma4 ture stalks (except the resin extracted 

5 therefrom), fiber, oil, or cake, or the steri6 lized seed of such plant which is incapable 

7 of germination; or 

8 ‘‘(iii) any drug product approved 

9 under section 505 of the Federal Food, 

10 Drug, and Cosmetic Act, or biological 

11 product licensed under section 351 of the 

12 Public Health Service Act. 

13 ‘‘(2) CANNABIS-RELATED LEGITIMATE BUSI14 NESS.—The term ‘cannabis-related legitimate busi15 ness’ means a manufacturer, producer, or any per16 son or company that is a small business concern and 

17 that— 

18 ‘‘(A) engages in any activity described in 

19 subparagraph (B) pursuant to a law established 

20 by a State or a political subdivision of a State, 

21 as determined by such State or political subdivi22 sion; and 

23 ‘‘(B) participates in any business or orga24 nized activity that involves handling cannabis or 

25 cannabis products, including cultivating, proVerDate Sep 11 2014 06:18 Jul 03, 2021 Jkt 019200 PO 00000 Frm 00072 Fmt 6652 Sfmt 6201 E:\BILLS\H3617.IH H3617

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1 ducing, manufacturing, selling, transporting, 

2 displaying, dispensing, distributing, or pur3 chasing cannabis or cannabis products. 

4 ‘‘(3) SERVICE PROVIDER.—The term ‘service 

5 provider’— 

6 ‘‘(A) means a business, organization, or 

7 other person that— 

8 ‘‘(i) sells goods or services to a can9 nabis-related legitimate business; or 

10 ‘‘(ii) provides any business services, 

11 including the sale or lease of real or any 

12 other property, legal or other licensed serv13 ices, or any other ancillary service, relating 

14 to cannabis; and 

15 ‘‘(B) does not include a business, organiza16 tion, or other person that participates in any 

17 business or organized activity that involves han18 dling cannabis or cannabis products, including 

19 cultivating, producing, manufacturing, selling, 

20 transporting, displaying, dispensing, distrib21 uting, or purchasing cannabis or cannabis prod22 ucts.’’. 

23 (b) SMALL BUSINESS DEVELOPMENT CENTERS.— 

24 Section 21(c) of the Small Business Act (15 U.S.C. 


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1 648(c)) is amended by adding at the end the following new 

2 paragraph: 

3 ‘‘(9) SERVICES FOR CANNABIS-RELATED LE4 GITIMATE BUSINESSES AND SERVICE PROVIDERS.— 

5 A small business development center may not decline 

6 to provide services to an otherwise eligible small 

7 business concern under this section solely because 

8 such concern is a cannabis-related legitimate busi9 ness or service provider.’’. 

10 (c) WOMEN’S BUSINESS CENTERS.—Section 29 of 

11 the Small Business Act (15 U.S.C. 656) is amended by 

12 adding at the end the following new subsection: 

13 ‘‘(p) SERVICES FOR CANNABIS-RELATED LEGITI14 MATE BUSINESSES AND SERVICE PROVIDERS.—A wom15 en’s business center may not decline to provide services 

16 to an otherwise eligible small business concern under this 

17 section solely because such concern is a cannabis-related 

18 legitimate business or service provider.’’. 

19 (d) SCORE.—Section 8(b)(1)(B) of the Small Busi20 ness Act (15 U.S.C. 637(b)(1)(B)) is amended by adding 

21 at the end the following new sentence: ‘‘The head of the 

22 SCORE program established under this subparagraph 

23 may not decline to provide services to an otherwise eligible 

24 small business concern solely because such concern is a 

25 cannabis-related legitimate business or service provider.’’. 


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1 (e) VETERAN BUSINESS OUTREACH CENTERS.—Sec2 tion 32 of the Small Business Act (15 U.S.C. 657b) is 

3 amended by adding at the end the following new sub4 section: 

5 ‘‘(h) SERVICES FOR CANNABIS-RELATED LEGITI6 MATE BUSINESSES AND SERVICE PROVIDERS.—A Vet7 eran Business Outreach Center may not decline to provide 

8 services to an otherwise eligible small business concern 

9 under this section solely because such concern is a can10 nabis-related legitimate business or service provider.’’. 

11 (f) SECTION 7(a) LOANS.—Section 7(a) of the Small 

12 Business Act (15 U.S.C. 636(a)) is amended by adding 

13 at the end the following new paragraph: 

14 ‘‘(38) LOANS TO CANNABIS-RELATED LEGITI15 MATE BUSINESSES AND SERVICE PROVIDERS.—The 

16 Administrator may not decline to provide a guar17 antee for a loan under this subsection, and a lender 

18 may not decline to make a loan under this sub19 section, to an otherwise eligible small business con20 cern solely because such concern is a cannabis-re21 lated legitimate business or service provider.’’. 

22 (g) DISASTER LOANS.—Section 7(b) of the Small 

23 Business Act (15 U.S.C. 636(b)) is amended by inserting 

24 after paragraph (15) the following new paragraph: 


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1 ‘‘(16) ASSISTANCE TO CANNABIS-RELATED LE2 GITIMATE BUSINESSES AND SERVICE PROVIDERS.— 

3 The Administrator may not decline to provide assist4 ance under this subsection to an otherwise eligible 

5 small business concern solely because such concern 

6 is a cannabis-related legitimate business or service 

7 provider.’’. 

8 (h) MICROLOANS.—Section 7(m) of the Small Busi9 ness Act (15 U.S.C. 636(m)) is amended by adding at the 

10 end the following new paragraph: 

11 ‘‘(14) ASSISTANCE TO CANNABIS-RELATED LE12 GITIMATE BUSINESSES AND SERVICE PROVIDERS.— 

13 The Administrator may not decline to make a loan 

14 or a grant under this subsection, and an eligible 

15 intermediary may not decline to provide assistance 

16 under this subsection to an otherwise eligible bor17 rower, eligible intermediary, or eligible nonprofit en18 tity (as applicable) solely because such borrower, 

19 intermediary, or nonprofit entity is a cannabis-re20 lated legitimate business or service provider.’’. 

21 (i) SMALL BUSINESS INVESTMENT COMPANY DE22 BENTURES TO FINANCE CANNABIS-RELATED LEGITI23 MATE BUSINESSES AND SERVICE PROVIDERS.—Part A of 

24 title III of the Small Business Investment Act of 1958 


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1 (15 U.S.C. 681 et seq.) is amended by adding at the end 

2 the following new section: 

3 ‘‘SEC. 321. DEBENTURES TO FINANCE CANNABIS-RELATED 

4 LEGITIMATE BUSINESSES AND SERVICE PRO5 VIDERS. 

6 ‘‘(a) GUARANTEES.—The Administrator may not de7 cline to purchase or guarantee a debenture made under 

8 this title to an otherwise eligible small business investment 

9 company solely because such small business investment 

10 company provides financing to an entity that is a can11 nabis-related legitimate business or service provider (as 

12 defined in section 7(a)(38) of the Small Business Act). 

13 ‘‘(b) OTHER ASSISTANCE.—A small business invest14 ment company may not decline to provide assistance under 

15 this title to an otherwise eligible small business concern 

16 solely because such small business concern is a cannabis17 related legitimate business or service provider (as defined 

18 in section 7(a)(38) of the Small Business Act).’’. 

19 (j) STATE OR LOCAL DEVELOPMENT COMPANY

20 LOANS.—Title V of the Small Business Investment Act 

21 of 1958 (15 U.S.C. 695 et seq.) is amended by adding 

22 at the end the following new section: 


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1 ‘‘SEC. 511. LOANS TO FINANCE CANNABIS-RELATED LEGITI2 MATE BUSINESSES AND SERVICE PROVIDERS. 

3 ‘‘(a) LOANS AND LOAN GUARANTEES.—The Admin4 istrator may not decline to make or provide a guarantee 

5 for a loan under this title to an otherwise eligible qualified 

6 State or local development company solely because such 

7 qualified State or local development company provides fi8 nancing to an entity that is a cannabis-related legitimate 

9 business or service provider (as defined in section 7(a)(38) 

10 of the Small Business Act). 

11 ‘‘(b) OTHER ASSISTANCE.—A qualified State or local 

12 development company may not decline to provide assist13 ance under this title to an otherwise eligible small business 

14 concern solely because such small business concern is a 

15 cannabis-related legitimate business or service provider (as 

16 defined in section 7(a)(38) of the Small Business Act).’’. 

17 SEC. 8. NO DISCRIMINATION IN THE PROVISION OF A FED18 ERAL PUBLIC BENEFIT ON THE BASIS OF 

19 CANNABIS. 

20 (a) IN GENERAL.—No person may be denied any 

21 Federal public benefit (as such term is defined in section 

22 401(c) of the Personal Responsibility and Work Oppor23 tunity Reconciliation Act of 1996 (8 U.S.C. 1611(c))) on 

24 the basis of any use or possession of cannabis, or on the 

25 basis of a conviction or adjudication of juvenile delin26 quency for a cannabis offense, by that person. 


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1 (b) SECURITY CLEARANCES.—Federal agencies may 

2 not use past or present cannabis or marijuana use as cri3 teria for granting, denying, or rescinding a security clear4 ance. 

5 SEC. 9. NO ADVERSE EFFECT FOR PURPOSES OF THE IMMI6 GRATION LAWS. 

7 (a) IN GENERAL.—For purposes of the immigration 

8 laws (as such term is defined in section 101 of the Immi9 gration and Nationality Act), cannabis may not be consid10 ered a controlled substance, and an alien may not be de11 nied any benefit or protection under the immigration laws 

12 based on any event, including conduct, a finding, an ad13 mission, addiction or abuse, an arrest, a juvenile adjudica14 tion, or a conviction, relating to cannabis, regardless of 

15 whether the event occurred before, on, or after the effec16 tive date of this Act. 

17 (b) CANNABIS DEFINED.—The term ‘‘cannabis’’— 

18 (1) means all parts of the plant Cannabis sativa 

19 L., whether growing or not; the seeds thereof; the 

20 resin extracted from any part of such plant; and 

21 every compound, manufacture, salt, derivative, mix22 ture, or preparation of such plant, its seeds or resin; 

23 and 

24 (2) does not include— 


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1 (A) hemp, as defined in section 297A of 

2 the Agricultural Marketing Act of 1946; 

3 (B) the mature stalks of such plant, fiber 

4 produced from such stalks, oil or cake made 

5 from the seeds of such plant, any other com6 pound, manufacture, salt, derivative, mixture, 

7 or preparation of such mature stalks (except 

8 the resin extracted therefrom), fiber, oil, or 

9 cake, or the sterilized seed of such plant which 

10 is incapable of germination; or 

11 (C) any drug product approved under sec12 tion 505 of the Federal Food, Drug, and Cos13 metic Act, or biological product licensed under 

14 section 351 of the Public Health Service Act. 

15 (c) CONFORMING AMENDMENTS TO IMMIGRATION

16 AND NATIONALITY ACT.—The Immigration and Nation17 ality Act (8 U.S.C. 1101 et seq.) is amended— 

18 (1) in section 212(h), by striking ‘‘and subpara19 graph (A)(i)(II) of such subsection insofar as it re20 lates to a single offense of simple possession of 30 

21 grams or less of marijuana’’; 

22 (2) in section 237(a)(2)(B)(i), by striking 

23 ‘‘other than a single offense involving possession for 

24 one’s own use of 30 grams or less of marijuana’’; 


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1 (3) in section 101(f)(3), by striking ‘‘(except as 

2 such paragraph relates to a single offense of simple 

3 possession of 30 grams or less of marihuana)’’; 

4 (4) in section 244(c)(2)(A)(iii)(II) by striking 

5 ‘‘except for so much of such paragraph as relates to 

6 a single offense of simple possession of 30 grams or 

7 less of marijuana’’; 

8 (5) in section 245(h)(2)(B) by striking ‘‘(except 

9 for so much of such paragraph as related to a single 

10 offense of simple possession of 30 grams or less of 

11 marijuana)’’; 

12 (6) in section 210(c)(2)(B)(ii)(III) by striking 

13 ‘‘, except for so much of such paragraph as relates 

14 to a single offense of simple possession of 30 grams 

15 or less of marihuana’’; and 

16 (7) in section 245A(d)(2)(B)(ii)(II) by striking 

17 ‘‘, except for so much of such paragraph as relates 

18 to a single offense of simple possession of 30 grams 

19 or less of marihuana’’. 

20 SEC. 10. RESENTENCING AND EXPUNGEMENT. 

21 (a) EXPUNGEMENT OF NON-VIOLENT FEDERAL

22 CANNABIS OFFENSE CONVICTIONS FOR INDIVIDUALS

23 NOT UNDER A CRIMINAL JUSTICE SENTENCE.— 

24 (1) IN GENERAL.—Not later than 1 year after 

25 the date of the enactment of this Act, each Federal 


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1 district shall conduct a comprehensive review and 

2 issue an order expunging each conviction or adju3 dication of juvenile delinquency for a non-violent 

4 Federal cannabis offense entered by each Federal 

5 court in the district before the date of enactment of 

6 this Act and on or after May 1, 1971. Each Federal 

7 court shall also issue an order expunging any arrests 

8 associated with each expunged conviction or adju9 dication of juvenile delinquency. 

10 (2) NOTIFICATION.—To the extent practicable, 

11 each Federal district shall notify each individual 

12 whose arrest, conviction, or adjudication of delin13 quency has been expunged pursuant to this sub14 section that their arrest, conviction, or adjudication 

15 of juvenile delinquency has been expunged, and the 

16 effect of such expungement. 

17 (3) RIGHT TO PETITION COURT FOR

18 EXPUNGEMENT.—At any point after the date of en19 actment of this Act, any individual with a prior con20 viction or adjudication of juvenile delinquency for a 

21 non-violent Federal cannabis offense, who is not 

22 under a criminal justice sentence, may file a motion 

23 for expungement. If the expungement of such a con24 viction or adjudication of juvenile delinquency is re25 quired pursuant to this Act, the court shall expunge 


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1 the conviction or adjudication, and any associated 

2 arrests. If the individual is indigent, counsel shall be 

3 appointed to represent the individual in any pro4 ceedings under this subsection. 

5 (4) SEALED RECORD.—The court shall seal all 

6 records related to a conviction or adjudication of ju7 venile delinquency that has been expunged under 

8 this subsection. Such records may only be made 

9 available by further order of the court. 

10 (b) SENTENCING REVIEW FOR INDIVIDUALS UNDER

11 A CRIMINAL JUSTICE SENTENCE.— 

12 (1) IN GENERAL.—For any individual who is 

13 under a criminal justice sentence for a non-violent 

14 Federal cannabis offense, the court that imposed the 

15 sentence shall, on motion of the individual, the Di16 rector of the Bureau of Prisons, the attorney for the 

17 Government, or the court, conduct a sentencing re18 view hearing. If the individual is indigent, counsel 

19 shall be appointed to represent the individual in any 

20 sentencing review proceedings under this subsection. 

21 (2) POTENTIAL REDUCED RESENTENCING.— 

22 After a sentencing hearing under paragraph (1), a 

23 court shall— 

24 (A) expunge each conviction or adjudica25 tion of juvenile delinquency for a non-violent 


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1 Federal cannabis offense entered by the court 

2 before the date of enactment of this Act, and 

3 any associated arrest; 

4 (B) vacate the existing sentence or disposi5 tion of juvenile delinquency and, if applicable, 

6 impose any remaining sentence or disposition of 

7 juvenile delinquency on the individual as if this 

8 Act, and the amendments made by this Act, 

9 were in effect at the time the offense was com10 mitted; and 

11 (C) order that all records related to a con12 viction or adjudication of juvenile delinquency 

13 that has been expunged or a sentence or dis14 position of juvenile delinquency that has been 

15 vacated under this Act be sealed and only be 

16 made available by further order of the court. 

17 (c) EFFECT OF EXPUNGEMENT.—An individual who 

18 has had an arrest, a conviction, or juvenile delinquency 

19 adjudication expunged under this section— 

20 (1) may treat the arrest, conviction, or adju21 dication as if it never occurred; and 

22 (2) shall be immune from any civil or criminal 

23 penalties related to perjury, false swearing, or false 

24 statements, for a failure to disclose such arrest, con25 viction, or adjudication. 


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1 (d) EXCEPTION.—An individual who at sentencing 

2 received an aggravating role adjustment pursuant to 

3 United States Sentencing Guideline 3B1.1(a) in relation 

4 to a Federal cannabis offense conviction shall not be eligi5 ble for expungement of that Federal cannabis offense con6 viction under this section. 

7 (e) DEFINITIONS.—In this section: 

8 (1) The term ‘‘Federal cannabis offense’’ means 

9 an offense that is no longer punishable pursuant to 

10 this Act or the amendments made under this Act. 

11 (2) The term ‘‘expunge’’ means, with respect to 

12 an arrest, a conviction, or a juvenile delinquency ad13 judication, the removal of the record of such arrest, 

14 conviction, or adjudication from each official index 

15 or public record. 

16 (3) The term ‘‘under a criminal justice sen17 tence’’ means, with respect to an individual, that the 

18 individual is serving a term of probation, parole, su19 pervised release, imprisonment, official detention, 

20 pre-release custody, or work release, pursuant to a 

21 sentence or disposition of juvenile delinquency im22 posed on or after the effective date of the Controlled 

23 Substances Act (May 1, 1971). 

24 (f) STUDY.—The Comptroller General of the United 

25 States, in consultation with the Secretary of Health and 


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1 Human Services, shall conduct a demographic study of in2 dividuals convicted of a Federal cannabis offense. Such 

3 study shall include information about the age, race, eth4 nicity, sex, and gender identity of those individuals, the 

5 type of community such users dwell in, and such other 

6 demographic information as the Comptroller General de7 termines should be included. 

8 (g) REPORT.—Not later than 2 years after the date 

9 of the enactment of this Act, the Comptroller General of 

10 the United States shall report to Congress the results of 

11 the study conducted under subsection (f). 

12 SEC. 11. REFERENCES IN EXISTING LAW TO MARIJUANA OR 

13 MARIHUANA. 

14 Wherever, in the statutes of the United States or in 

15 the rulings, regulations, or interpretations of various ad16 ministrative bureaus and agencies of the United States— 

17 (1) there appears or may appear the term 

18 ‘‘marihuana’’ or ‘‘marijuana’’, that term shall be 

19 struck and the term ‘‘cannabis’’ shall be inserted; 

20 and 

21 (2) there appears or may appear the term 

22 ‘‘Marihuana’’ or ‘‘Marijuana’’, that term shall be 

23 struck and the term ‘‘Cannabis’’ shall be inserted. 


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1 SEC. 12. SEVERABILITY. 

2 If any provision of this Act or an amendment made 

3 by this Act, or any application of such provision to any 

4 person or circumstance, is held to be unconstitutional, the 

5 remainder of this Act, the amendments made by this Act, 

6 and the application of this Act and the amendments made 

7 by this Act to any other person or circumstance shall not 

8 be affected. 

9 SEC. 13. CANNABIS OFFENSE DEFINED. 

10 For purposes of this Act, the term ‘‘cannabis offense’’ 

11 means a criminal offense related to cannabis— 

12 (1) that, under Federal law, is no longer pun13 ishable pursuant to this Act or the amendments 

14 made under this Act; or 

15 (2) that, under State law, is no longer an of16 fense or that was designated a lesser offense or for 

17 which the penalty was reduced under State law pur18 suant to or following the adoption of a State law au19 thorizing the sale or use of cannabis. 

20 SEC. 14. RULEMAKING. 

21 Unless otherwise provided in this Act, not later than 

22 1 year after the date of enactment of this Act, the Depart23 ment of the Treasury, the Department of Justice, and the 

24 Small Business Administration shall issue or amend any 

25 rules, standard operating procedures, and other legal or 

26 policy guidance necessary to carry out implementation of 


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1 this Act. After the 1-year period, any publicly issued sub2 regulatory guidance, including any compliance guides, 

3 manuals, advisories and notices, may not be issued with4 out 60-day notice to appropriate congressional commit5 tees. Notice shall include a description and justification 

6 for additional guidance. 

7 SEC. 15. SOCIETAL IMPACT OF MARIJUANA LEGALIZATION 

8 STUDY. 

9 The Comptroller General of the United States shall, 

10 not later than 2 years after the date of enactment of this 

11 Act, provide to Congress a study that addresses the soci12 etal impact of the legalization of recreational cannabis by 

13 States, including— 

14 (1) sick days reported to employers; 

15 (2) workers compensations claims; 

16 (3) tax revenue remitted to States resulting 

17 from legal marijuana sales; 

18 (4) changes in government spending related to 

19 enforcement actions and court proceedings; 

20 (5) Federal welfare assistance applications; 

21 (6) rate of arrests related to methamphetamine 

22 possession; 

23 (7) hospitalization rates related to methamphet24 amine and narcotics use; 


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1 (8) uses of marijuana and its byproducts for 

2 medical purposes; 

3 (9) uses of marijuana and its byproducts for 

4 purposes relating to the health, including the mental 

5 health, of veterans; 

6 (10) arrest rates of individuals driving under 

7 the influence or driving while intoxicated by mari8 juana; 

9 (11) traffic-related deaths and injuries where 

10 the driver is impaired by marijuana; 

11 (12) arrest of minors for marijuana-related 

12 charges; 

13 (13) violent crime rates; 

14 (14) school suspensions, expulsions, and law en15 forcement referrals that are marijuana-related; 

16 (15) high school dropout rates; 

17 (16) changes in district-wide and State-wide 

18 standardized test scores; 

19 (17) marijuana-related hospital admissions and 

20 poison control calls; 

21 (18) marijuana-related juvenile admittances 

22 into substance rehabilitation facilities and mental 

23 health clinics; 

24 (19) diversion of marijuana into neighboring 

25 States and drug seizures in neighboring States; 


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1 (20) marijuana plants grown on public lands in 

2 contravention to Federal and State laws; and 

3 (21) court filings under a State’s organized 

4 crime statutes. 

Æ 


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