New Emergency Law Empowers Authorities To Crack Down On Cannabis Gifting Shops In D.C.

The D.C. Council green-lighted an emergency measure to give city officials the authority to impose penalties on unlicensed marijuana gifting shops that do not operate under the city’s medical cannabis program, reported DCist.

Policymakers unanimously supported the bill on Tuesday. Cannabis businesses that fail to apply for the program or meet its requirements are liable to face civil enforcement as stipulated by the Medical Cannabis Enforcement Emergency Amendment Act of 2024  from Ward 6 Councilmember Charles Allen.

As soon as Mayor Muriel Bowser signs it, the emergency bill will take effect.

What Are Marijuana Gifting Shops?

Cannabis companies that "gift" marijuana to customers after they purchase another product such as an article of clothing, have been targeted by D.C. officials for years.

Inspections into this practice, announced in 2022, were undertaken because retail shops were said to be illegally exploiting the law under which people were allowed to give small amounts of marijuana, D.C. officials said at the time.

However, inspections by a Joint Cannabis Task Force from the Alcoholic Beverage Regulation Administration slated to begin in September 2022 were postponed due to health code, tax and licensing violations.

At that time, a majority of D.C. voters said they were against the crackdown on the cannabis gifting market, according to a poll done by the I-71 Committee and Research & Strategies.

See also: Connecticut Cannabis Crackdown: AG Sues 7 Local Businesses, Takes Swift Action Against Gifting Events

Terrence White, chairman of the I-71 Committee, named after the 2014 voter-approved initiative that legalized the possession, personal use, home cultivation and gifting of small amounts of cannabis, said that it is "abundantly clear District voters do not want D.C. Councilmembers to act and punish our stores," adding that the "punishment will only cause more problems."

In October 2022, a D.C. cannabis company even sued the city, claiming that police officers seized more than $700,000 in cash during raids in 2021.

However, a legislative push from D.C. Council chairman Phil Mendelson, the Medical Cannabis Amendment Act, which, along with expanding the District’s existing medical marijuana program, sought to end “gifting” operations as it builds on a previous bill to impose a $30,000 fine for unregistered businesses that gift marijuana.

The legislation allowed retailers that give away weed to apply for medical marijuana licenses stipulating that those refusing to comply will be subject to civil enforcement. It remains unclear as to which government agency should deal with businesses that continue to operate without a license.

Enter New Cannabis Enforcement Emergency Bill

Now, emergency legislation from Councilmember Allen seeks to change that by:

• Empowering the Alcoholic Beverage and Cannabis Administration (ABCA) to issue warnings, fines, and cease and desist orders to unlicensed businesses that have not applied to become licensed under the District's medical cannabis program.
• Giving ABCA and the Metropolitan Police Department of the District of Columbia (MPD) authority to inspect an establishment's books and records;
• Authorizing the confiscation of cannabis produced, marketed, or traded in violation of the medical cannabis program;
• Requiring the Department of Licensing and Consumer Protection (DLCP), Office of Tax and Revenue, and the Fire and Emergency Medical Services Department to promptly report to ABCA any violation committed by a licensed establishment within 30 days.
• Prohibiting unlicensed businesses to showcase any signs or visuals promoting cannabis or cannabis products, or advertising as “I-71 compliant.”
• Allowing the affected ANCs in neighborhoods where unlicensed establishments are applying to become medical establishments to provide input, just as they do when considering liquor licenses.
• Delegating the responsibility of imposing fines on commercial property owners hosting unlicensed establishments onto the ABCA, transferring this authority from the DLCP.