By Joseph Ditzler

The Bulletin

Legitimate marijuana businesses in Oregon have little to fear from a law-enforcement turnabout announced Thursday by the U.S. Department of Justice, according to a statement from the U.S. Attorney for the District of Oregon.

U.S. Attorney General Jeff Sessions rescinded the Cole Memo, an Obama-era directive that stipulated a hands-off approach to federal law enforcement as long as states where marijuana is legal policed themselves. Thursday, Sessions, in a memo to all federal prosecutors, wrote that “previous guidance” on enforcement of federal laws on marijuana, including the Cole Memo, “is unnecessary and is rescinded, effective immediately.”

Sessions wrote that federal prosecutors should “weigh all considerations,” and apply their resources where they will “reduce violent crime, stem the tide of the drug crisis and dismantle criminal gangs.”

U.S. Attorney for Oregon Billy J. Williams, in a statement Thursday afternoon, stated his office would continue working with state, local and tribal authorities, as well as federal officials, to “pursue shared public safety objectives,” particularly the black market in cannabis that spurs out-of-state diversion of marijuana, and organized and violent crime.

The statement by Williams followed a day of pushback from members of Oregon’s congressional delegation, state officials and advocates for legal cannabis. Oregon’s stake in legal marijuana exceeded first forecasts ahead of recreational sales in 2015.

Retailers reached a high point in August, when they sold about $40 million worth of marijuana for the month. The legal marijuana market in 2017 generated more than $62.3 million in state sales taxes. The city of Bend estimated it would receive about $740,000 as its share of state and local sales since January 2016.

Amy Margolis, a Portland attorney who represents clients in the business, earlier Thursday had advised pot proponents to wait and see what Williams had to say. Margolis, executive director of the Oregon Cannabis Association, said she was not speaking on behalf of the association.

“I, like everyone else, am waiting and hopeful that Billy Williams will respect the voters of the state and allow legal, compliant businesses to continue to operate without legal repercussions,” she said Thursday morning. “I’m hopeful he’ll do the right thing.”

Margolis did not return a call Thursday afternoon for further comment.

Oregon lawmakers let loose a torrent of criticism. State Rep. Knute Buehler, R-Bend, a gubernatorial candidate, in a statement wrote: “The federal government should respect the will of Oregon voters; the principle of federalism is at stake.”

U.S. Sens. Ron Wyden and Jeff Merkley, both Democrats, blasted Sessions in separate statements. Wyden suggested using negotiations on federal spending to curb crackdowns in states where cannabis is legal.

“Any budget deal Congress considers in the coming days must build on current law to prevent the federal government from intruding in state-legal, voter-supported decisions,” Wyden’s office quoted him as saying Thursday.

Likewise, Merkley said nothing is gained by prosecuting “nonviolent cannabis crimes” and that public safety suffers by driving marijuana back into the black market. “This is a destructive decision and a huge step backwards,” he was quoted as saying.

In Oregon, Gov. Kate Brown, Treasurer Tobias Read, both Democrats, and state House Majority Leader Jennifer Williamson, D-Portland, all uniformly weighed in against a crackdown on legal cannabis.

“I stand with Gov. Brown in pushing back against the roll back of federal marijuana policy,” Williamson was quoted as saying. “We must not go backward.”

Locally, the chairwoman of the Deschutes County Republican Party, Patti Adair praised Sessions’ move as good news.

“We’re happy to hear that the federal government is actually going to change direction,” she said Thursday. “It’s a nightmare when you have all this marijuana coming in and it’s out of control.”

Even those who approve of legalized marijuana rethink that position when cannabis growers locate in their neighborhoods, said Adair. Cannabis brings crime and lowers property values, and contributes to wasted resources such as water, she said. It also brings unintended consequences, she said.

“We’re first concerned with the smell (of a cannabis farm), but the smell is just the first thing,” Adair said.

“The problems go much deeper.”

Cannabis business owners and their advocates said they expected little impact from the Justice Department change in course.

Justin Clapick, a partner in Deschutes Growery, an indoor cannabis farm in Bend, said rescinding the Cole Memo may work to the advantage of legal marijuana. He said he foresaw the change in course and attributes it to a political struggle.

“It’s going to be a clash in Washington between guys like Jeff Sessions and other guys trying to push for reform like (U.S. Rep.) Earl Blumenauer (D-Portland),” Clapick said. “It’s actually a good thing that will force an issue to be resolved that’s been hanging in the wind.”

Bend is home to 20 recreational marijuana retailers. Deschutes County at large contains 64 licensed cannabis business, including retailers, wholesalers, testing labs, processors and growers. The investments in individual businesses are worth millions.

Jeremy Kwit, owner of two Substance cannabis retail shops in Bend, said that even with the Cole Memo rescinded, the size of the market in Oregon and in Bend in particular is fairly inconsequential compared to California, for example.

“The fact that we are operating in strict and unambiguous compliance with our state regulations and the fact that there’s a solid set of state regulations gives me a lot of emotional security so as to not worry about a possible federal intervention,” he said.

Kwit said he felt that shift in federal attitude toward marijuana in states that have legalized it will not chill business.

“I don’t see the feds turning back to prohibition,” he said Thursday. “The cannabis train has left the station.”

Attorney Jennifer Clifton, of Bend, who specializes in cannabis law and represents clients in Oregon and California, said rescinding the Cole Memo has meant some investors are pulling back.

That may slow expansion of the marijuana market in California, but not necessarily in Oregon.

“My opinion is that Oregon has a well-regulated cannabis market with lots of support from the state government,” Clifton said.

“I don’t feel like it’s going to change the landscape,” other than force out the “bad actors.”

— Reporter: 541-617-7815,