Two years since the enactment of recreational pot law, Guam is still laboring over draft rules
Updated: Oct 4, 2021
By Louella Losinio
An economic impact study projected that the recreational cannabis industry on Guam will generate $11.5 million in additional revenue from tourists. Released by the Guam Visitors Bureau in December last year, the study estimated that the new industry will draw 31,500 new visitors to the island and create 734 additional jobs.
In her state of the island address delivered in March, Gov. Lou Leon Guerrero asked the Guam Legislature to appropriate the first $50 million in proceeds from the legal sale of cannabis for repair of Tumon roads and sewage systems and improvement of the island’s attraction sites.
But Guam leaders are counting the chicks before the eggs hatch.
The Guam Cannabis Industry Act, which was signed into law in April 2019, legalized recreational marijuana and laid the foundation for establishing a regulated industry on Guam. After two years, the document finally reached the desk of the attorney general, who is going through another review process.
Guam’s steady but slow progress in developing its recreational cannabis rules and regulations drew comparisons with the Northern Marianas, where the cannabis industry is now in existence.
The CNMI Cannabis Commission officially adopted its rules and regulations in June 2020 and opened applications for commercial cannabis licenses and a homegrown noncommercial registry a few months later.
In March this year, the CNMI Cannabis Commission issued its first commercial license to Slider Marianas LLC. The commercial license allows for the legal planting, cultivation, growth, harvesting, drying and sale of cannabis to licensed wholesalers, processors, retailers, lounges, laboratories, and research certificate holders in the CNMI.
The Guam Cannabis Industry Act also mandated the creation of the Cannabis Control Board to officially start the drafting of the rules and regulations for personal consumption and the commercial sale of cannabis.
“Where we are at the moment is that the AG’s office has given us their feedback and comment,” said Vanessa Williams, chair of the Guam Cannabis Control Board. She spoke about the status of the draft rules and regulations at last month’s virtual seminar, “Marijuana Hits the Shores of Guam & CNMI.”
The seminar covered tourism and economic impacts by the cannabis industry and attending federal and local legal challenges.
“They have had some comments on some provisions that don’t pass muster that we need to amend within the rule, specifically dealing with seizures since this is no longer a criminal act,” she said. “That’s where we are now right now—reviewing their amendments and addressing the AG's comments.”
The provisions that are in the final regulations cover cannabis consumption, growth, and cultivation rules; issuance of licenses of manufacturing, cultivation, and retail sites, and built-in protections for consumers and property owners.
Like any government agency participating in a rulemaking process, the implementation of rules and regulations must go through the triple-A process. After a review and approval by the AG, it will be submitted to the legislature.
The legislature has until 90 days to set up public hearings, amend its provisions as needed, and decide whether to adopt or reject the document.
Williams said the rulemaking process could take anywhere between 60 to 90 days. “We have a completely different legislature, a different makeup of senators and how they feel about adult-use or recreational marijuana. I really don’t know what kind of changes they want to make before they pass the rules.”
Since convening in 2019, the control board has met around 25 times. “Anyone can verify that on the OPA website. Guam law requires that all public meetings, all discussions that encompass these rules be in an open meeting,” she said.
Williams said she definitely feels the pressure. While the community wants the rules implemented immediately, the board has to comply with the rulemaking process.
Mitchell Kahn, a lawyer and co-founder and CEO of Grassroots Cannabis, who also spoke at the virtual event, said the delay in the passage of the implementing rules did not surprise him at all.
“I think that it is very typical. In particular, in the early states that adopted cannabis legislation,” said Kahn. “Oftentimes it took months, or even years to pass legislation and then rules. I think it has gotten better over time as people get more and more comfortable with it.”
Kahn said politicians who refuse to consult with real industry experts while crafting the rules and regulations pose another challenge.
Judge Daniel P. Collins of the U.S. Bankruptcy Court at the District of Arizona, facilitated the discussion. At the start of the event, Collins provided an overview of the state of the cannabis industry and legislation in the U.S.
Besides Guam and the CNMI, he said 37 states across the country already have some form of cannabis legislation.
Last year, the industry reported revenues of around $17.5 billion throughout the United States— a 46 percent increase from 2019 figures.
Also needing consideration is the banking aspect of the cannabis business.
Despite this widespread legalization at the state level, marijuana remains an illegal Schedule I controlled substance under federal law. In light of expanding legalization initiatives at the state level, the Financial Crimes Enforcement Network issued guidance in 2014 clarifying its expectations for financial institutions seeking to provide services to “marijuana-related businesses” under the Bank Secrecy Act.
The SAFE Banking Act has previously passed three times in the House before ultimately dying in the Senate. The bill was reintroduced this year by a bipartisan group of over 100 members of the House.
Prior the passage of recreational pot, Guam voters ratified the legalization of medical marijuana in 2014. Public Law 33-220, also known as the “Joaquin Concepcion, II Compassionate Cannabis Use Act of 2013,” allows the beneficial use of medical cannabis by qualified patients to alleviate symptoms caused by their debilitating medical conditions and their medical treatments.
The rules and regulations that govern the medical cannabis program were passed in 2018 and became Public Law 34-80, which authorizes qualified patients and designated caregivers to cultivate medical cannabis at home until a dispensary is operational.