Proceedings of the Standing Senate Committee on
Social Affairs, Science and Technology
Issue No. 42 - Evidence - May 3, 2018
OTTAWA, Thursday, May 3, 2018
The Standing Senate Committee on Social Affairs, Science and Technology, to which was referred Bill -45, An Act respecting cannabis and to amend the Controlled Drugs and Substances Act, the Criminal Code and other Acts, met this day at 10:31 a.m., in public and in camera, to continue its consideration of this bill and to consider a draft report on matters relating to social affairs, science and technology.
Senator Art Eggleton (Chair) in the chair.
[Translation]
The Chair: Welcome to the Standing Senate Committee on Social Affairs, Science and Technology.
[English]
I’m Art Eggleton, a senator from Toronto and chair of the committee. I would invite my colleagues on the committee who are here to introduce themselves.
[Translation]
Senator Petitclerc: Hello. Chantal Petitclerc, senator from Quebec.
[English]
Senator Omidvar: Ratna Omidvar, Ontario.
Senator Munson: Jim Munson, Ontario.
Senator Campbell: Larry Campbell, Galiano Island, British Columbia.
Senator Deacon: Marty Deacon, Ontario.
Senator Manning: Fabian Manning, Newfoundland and Labrador.
Senator Raine: Nancy Greene Raine from B.C.
Senator Galvez: Bom dia. Rosa Galvez from Quebec.
[Translation]
Senator Poirier: Rose-May Poirier from New Brunswick.
[English]
Senator Seidman: Good morning. Judith Seidman, Montreal, Quebec.
The Chair: This morning we continue with Bill C-45, An Act respecting cannabis and to amend the Controlled Drugs and Substances Act, the Criminal Code and other Acts.
We have three components to our meeting today and two panels. Both of these panels are examining other jurisdictions’ experience in terms of cannabis, either decriminalization or legalization.
The third component of our meeting, which will start at 12:30, will be in relation to the study on the creation of a social finance fund, and we’ll go into camera for that meeting, from 12:30 to 1:15.
Meanwhile, on panel one, which will be the first hour, we have two participants. Here with us in the committee room is Dr. Kenneth Finn, a pain medicine physician who has had experience in the State of Colorado with respect to the implementation of their program.
We also have witnesses by video conference.Bom dia. By coincidence, your Prime Minister, Antonio Costa, is here in Ottawa and is currently meeting across the street with the Prime Minister. But we welcome you. You are the important people for us. By video conference, we have Dr. Manuel Cardoso, Deputy Director General, Intervention and Addictive Behaviours, and Ana Sofia Santos, Head, International Relations Division.
I want to mention to our witnesses that seven minutes is our maximum for opening comments. I know, Dr. Cardoso and Ms. Sofia Santos, that we have a written submission from you, a good lengthy one. If you could highlight that for us in seven minutes, that would be appreciated. Then I’ll go to Dr. Finn after that. We’ll start with you, Dr. Cardoso.
Dr. Manuel Cardoso, Deputy Director-General, General Directorate for Intervention on Addictive Behaviours and Dependencies, Serviço de Intervenção nos Comportamentos Aditivos e nas Dependências (SICAD - Portugal): Good morning, honourable senators. Thank you for the invitation to give this presentation today. It’s a great pleasure to be here and to share some of our experiences as input to the discussion around your legislation.
It is important to mention that Portugal is a small country, the westernmost country of mainland Europe, with around 10 million inhabitants. We have a national health service available for all citizens. SICAD is the central body of the Ministry of Health, which supports the government with addictive behaviours and dependencies issues. SICAD plans, implements and coordinates drug demand reduction interventions and collects, analyzes and disseminates information on drug use and responses to it.
In recent years, Portuguese policy has attracted the attention of the policymakers and media due to an innovative approach regarding personal consumption and possession of any illegal substance. I reinforce, any illicit substance. This means that we have no specific legal framework for cannabis.
By the end of the 1980s and the 1990s, we were one of the highest European prevalence countries for problematic drug use. Drugs and drug addiction became an enormous social health and political problem in Portuguese society. Most addicts were afraid of entering treatment programs as they feared referral to criminal justice.
In 1997, drug addiction was rated the first concern among Portuguese people. By that time, around 1 per cent of the Portuguese population were problematic drug users, 98 per cent of those in treatment were heroin addicts and more than 50 per cent were injecting drug users. HIV infection among drug users represented 60 per cent of the total number of infected people, and the rate of overdoses was 35 per million of inhabitants and increasing.
To face this problem, the government created an expert commission to study and present a report on the launching of a national strategy on drugs. The only boundary defined by the government to the work of the commission was to keep any proposal to be presented within the limits of the three main international drug control conventions of the United Nations.
As a result of this work, the first Portuguese national strategy on drugs was developed and approved in 1999. It foresaw a balanced approach between supply and demand reduction, comprising a prevention program in partnership with municipalities and NGOs, a treatment network extended to the whole country, the development of a harm reduction network and reintegration programs aimed at recovered drug users.
The Portuguese strategy also advocated an innovative change of law. Drug addiction was to be viewed as a disease and drug users as citizens in need of treatment.
While the national strategy published as a Council of Ministers’ resolution was immediately adopted, a bill of law concerning decriminalization was presented to Parliament for adoption.
A new law was approved by Parliament and entered into force on July 1, 2001. The law introduced a radical change in the way of facing drug use. The consumption, acquisition and possession for own use of narcotics and psychotropic substances is no longer a crime but constitutes an administrative offence.
According to the decriminalization law, those administrative offences are no longer judged in court. They are submitted to a drug addiction dissuasion commission especially created for this purpose within the Ministry of Health. The dissuasion commissions were created in 2001 all over the country to hear all the offenders found in possession of use of drugs. The commissions comprised three members with appropriate professional expertise in the field of drug addiction and a multi-disciplinary technical team that prepared all the facts and made previous evaluation to support the commission’s decision.
In sum, Portugal decriminalized all drugs but didn’t legalize them, and the decriminalization policy is part of a balanced and integrated approach that links prevention, treatment, harm reduction and social reintegration.
Seventeen years after the approval of the law, we identified several gains: a significant reduction in the number of problematic users; a considerable reduction in the prevalence of injection drug use; a strong reduction of overdose numbers and infectious disease; a reducing stigmatization of drug users; reducing the burden of drug offenders in the criminal justice system; and an increase in the amount of drugs seized and efficiency of policy, police and customs.
We are taking advantage of the preventive potential of the drug addiction dissuasion commissions, which provide an opportunity for an early, specific and integrated interface with drug users.
To conclude, we are happy with the current legal Portuguese framework and with the positive evolution in the national system. Anyway, we will follow the international developments on the risk assessment of cannabis use in terms of its impact on health and, of course, we will be attentive to any change that may be proposed in the future. But for the moment there is, in our opinion, a lack of scientific evidence.
Mr. Chair and members of the committee, I thank you again for this opportunity. I’ll be happy to answer any questions that you may have.
The Chair: Thank you very much. We will have questions for both of you. We’ll get back to you shortly.
Meanwhile, I’ll ask Dr. Finn, who is with us here at the committee and has the experience in Colorado, to please address us for up to seven minutes.
Dr. Kenneth Finn, Pain Medicine Physician, Springs Rehabilitation: Thank you for allowing me to be here.
For background, in 2012 the State of Colorado voted on Amendment 64, legalizing marijuana for recreational use, which passed by a 55 per cent vote. It allowed anyone over the age of 21 to consume or possess limited amounts and allow local governments to regulate or prohibit within their jurisdiction. In Colorado, 72 per cent of the state’s municipalities opted out of recreational marijuana despite the vast majority recommending it be legalized.
It also enacted an excise tax that would generate revenue for the State of Colorado. In 2017, Colorado received $247 million in tax revenue, comprising about 1 per cent of the State’s total budget.
The governor of Colorado has reported a $500-million shortfall in the 2018 budget, so significant cuts to roads, schools, hospitals, increasing state tuition and elimination of the taxpayer refund.
In 2013, the U.S. Department of Justice released the Cole Memo, allowing states with marijuana laws to develop regulatory schemes to protect eight federal enforcement areas, which included:
One, the prevention of distribution to minors. In Colorado, between 2005 and 2015, the proportion of emergency room department or urgent care visits for those between 13 years old and 20 years old increased by more than 100 per cent. The past month use of marijuana among Colorado youth 12 to 17 continues to be above the national average. There has been a 65 per cent increase in first-time use among Colorado youth since legalization, now Colorado ranking first in the country. Marijuana is the most prevalent substance found in completed Colorado teen suicide. Marijuana-related exposure to children aged 0 to 5 nearly tripled in the four-year average since legalization compared to the four-year average prior to legalization. There has been a 19 per cent increase in marijuana-related school suspensions in the 2016-17 school year and 88 per cent of students report getting marijuana from parents, friends or the black market.
Two, prevent revenue from the sale of marijuana going to criminal enterprises, gangs and cartels. The number of illegal marijuana grows in Colorado has significantly increased since legalization. In El Paso County, where I live, Colorado Springs opted out of having legal marijuana, but we have over 500 illegal marijuana grows in our community.
Three, prevent diversion of marijuana from states where it is legal under state law in some form to other states. In 2016 alone, Colorado law enforcement confiscated 7,000 pounds of marijuana, carried out 252 felony arrests and made 346 highway interdiction seizures of marijuana headed to 36 different states. The U.S. mail system saw an 844 per cent increase in postal marijuana seizures out of Colorado since legalization.
Four, prevent state-authorized marijuana activity from being a cover or pretext for trafficking of other illegal drugs or illegal activity. Colorado’s largest drug bust since legalization in June of last year included violations of the Colorado Organized Crime Act, money laundering, tax evasion, theft, as well as mortgage and securities fraud and included a former Colorado marijuana enforcement officer.
Five, prevent violence in the use of firearms in the cultivation and distribution of marijuana. Colorado Springs had a record number of total homicides since legalization in 2017, and a record number of marijuana-related homicides in 2017 since legalization. Overall, Colorado has seen an 11 per cent increase in marijuana-related crimes from 2013 to 2016.
Six, prevent drugged driving and the exacerbation of other adverse health consequences associated with marijuana use. Colorado had a record number of marijuana-related driving fatalities in 2016, with more than 20 per cent being marijuana related. In 2017, we had a new record of total fatalities but the marijuana data is still pending. High potency products are associated with severe mental illness, including psychosis and schizophrenia. The products of today are not the same as they were even four years ago. Marijuana has not curbed our opioid epidemic. Colorado had a record year of opioid overdose deaths in 2017, and we are also now seeing an increase in other drug-related deaths from methamphetamine and cocaine since mass commercialization.
Legalization has been associated with increased marijuana use, causing an increase in ER visits and hospitalizations related to marijuana toxicity, Cannabinoid Hyperemesis Syndrome, psychosis and pediatric exposure, at uncertain costs. One hospital and community where I lived which opted out of legal marijuana lost $20 million in health care dollars just due to marijuana-related emergency room visits between 2009 and 2014. There are multiple other negative medical health effects including cardiac, pulmonary, gastrointestinal, fetal, neonatal, maternal fetal, pediatric, neurologic and psychiatric, to name a few.
Seven, prevent the growing of marijuana on public lands and the attendant public safety environmental dangers posed by marijuana production on public lands. Eradication of illegal marijuana plants from Colorado’s Rocky Mountains increased over 2,200 per cent since 2014, with a street value of $177 million.
Eight, prevent marijuana possession or use on federal property. In 2012, a 20-acre illegal marijuana grow was found in the burn scar of Colorado Springs’ largest wildfire.
In summary, Colorado has done a terrible job with mass commercialization, expansion and legalization of marijuana, creating significant public health and safety concerns and unknown societal effects reminiscent of alcohol and tobacco.
Don’t fly the plane before you build it. Follow the science and not the money. This could be the largest Trojan Horse of all time. I invite all of you to come to Colorado and see first-hand the marijuana refugees that are coming to Colorado. Spend time in the emergency departments where my colleagues and friends are seeing marijuana-related issues every single day. Speak to the first responders, who have to go home and wash their clothes and clean off because they smell like marijuana after every shift, despite their calls may have had nothing to do with marijuana. Meet the families affected by this experiment in Colorado. Talk to the ones who lost loved ones related to marijuana.
I invite all of you to come to Colorado and see what’s actually happening from a boots-on-the-ground perspective. Thank you.
The Chair: Thank you, Dr. Finn.
We will now turn to questions from committee members. We will try for five minutes each, but it’s going to be tight. Please direct your question and keep it as brief as you can. We will start with the deputy chairs.
Senator Petitclerc: My question is for our guest from Portugal. I would like to hear you on why Portugal chose to decriminalize instead of legalize. As you know, we are in the process of legalizing, and I want to have your perspective on why you chose the approach of decriminalization and not legalization.
Dr. Cardoso: Well, first of all, as I mentioned, the first and the only constraint that the government mentioned to the commission was, “Don’t go against the United Nations conventions related to control of psychoactive substances,” this one issue.
The other is that, in fact, with decriminalizing, what we have is control. The substance continues to be illegal, and, with this, we continue to contact or have the facility to contact the users and use this fact to try to help them to quit the consumption and use of drugs. If you legalize, it’s possible for everyone to consume, instead of the rules you have with the legalization.
Senator Petitclerc: Thank you. Can you tell me how you approached the fight against the illicit market? Because this is one of the things that is very important to us.
Dr. Cardoso: I didn’t hear the last part of the question.
Senator Petitclerc: Yes. I would like to hear you on how, with your approach, you tackled the fight on the illicit market?
Dr. Cardoso: It’s the same as when everything was illegal because, on the trafficking and the sale of illicit drugs, they continue to be illicit, so we have to fight in the same way. The only change, if you look at the document we sent to you, is that the police can reallocate their resources to the big traffic instead of the small users or the small dealers. That is the big difference.
On the other hand, and relating also with the first question, we decriminalized all drugs, not only cannabis. Legalizing all drugs is not on the table. That’s clear to all of us because the problems, the health problems, are so big that it’s very difficult to think about.
But, in fact, what we do related with trafficking is the same as if the use were criminalized. It’s the same work.
The Chair: Let me follow up on that, Dr. Cardoso.
In the trafficking area, or what you call “supply reduction,” how do you separate the big fish from the little fish, the big traffickers from the little ones? We’ve had a discussion here, for example, that, if somebody just over the age limit gives to somebody just under the age limit, it’s a criminal offence. If you are passing on one joint, in the case of cannabis, it could be a criminal offence if it’s an older person to a younger person. Where do you decide to draw the line in terms of trafficking? How have you worked that out?
Dr. Cardoso: At the same time as we approved the law, we approved and added defining the amounts of each drug that can be in the possession of the user, and we decided on an amount for own consumption for 10 days. It’s clear the amount of drug you can possess to use.
But, even if the user has in their possession more than that quantity, he is sent to court by the police, but, at the same time, the judge, if they identify that the substance is only for their own consumption, sends them back to the commission.
So we had clearly an amount of drug used in 10 days or to consume in 10 days.
The Chair: Thank you.
Senator Seidman: Thanks to both of you for your presentations to us this morning.
I’d like to address my question, at the outset, to our guests from Portugal, if I may. I’d like to thank you, first of all, for providing insights into the challenges that Portugal has faced with respect to drug abuse and your country’s experience with decriminalization.
I’d like to refer, Dr. Cardoso, to your concluding comments. You said that you will follow the international developments on the risk assessment of cannabis in terms of its impact on health, but you said, “For the moment, there is, in our opinion, a lack of scientific evidence.”
I’d like to ask if you could, please, expand on this opinion. Do you believe that legalizing a drug instead of decriminalizing it could imply and send a message that it’s safe to use?
Dr. Cardoso: In fact, I can take your last phrase to say yes. Here in Portugal, on this discussion around the world about legalization, we are convinced that we have a little bit increasing consumption only because we decriminalized 17 years ago.
When I mentioned the lack of scientific evidence, I would like to see the WHO or the United Nations improving the scientific approach and the assessment on the cannabis use to see if the prohibition or the situation of illicitude of these substances could be maintained or not because, in fact, the United Nations conventions are for trafficking, not so well-related with health issues. From our point of view, the WHO or the United Nations as a whole need to make more strong and in-depth assessments on the health impact of this consumption. If the result of this assessment gives us the information that cannabis use is not so bad or so problematic, then it can be changed. The acts under the regulation could be written differently. But this is the idea. We need to know more to maintain the substance as illegal or another kind of annex or so. But, from our point of view, it will be interesting or important to hear WHO and the United Nations.
Senator Seidman: I want to actually really confirm that I understand what you told us because I think it’s really important. You said, in response to the last part of my question, that, yes, there is an increase in use, you think, from decriminalizing in Portugal and that it does send a message that it’s safer to use marijuana. Is that correct?
Dr. Cardoso: No.
Senator Seidman: I just wanted to be clear.
Dr. Cardoso: I mentioned we have, in fact, an increase in the consumption of cannabis, in lifetime prevalence. That’s easy to understand in a lifetime in adults, between 15 and 74. Also in the youth, prevalence is decreasing. All other drugs are decreasing. The prevalence is decreasing, in the last years.
What I mentioned is about the discussion all over the world about legalization. Even here in Portugal, people understand that if they are legalizing the substance, probably the risk is not so high. We have an increase of consumption in the last two or three years.
Senator Seidman: The discussion of legalization. Thank you.
The Chair: Colleagues, I now have eight members on the list and we are running short of time, so I will cut it back to three minutes each.
[Translation]
Senator Mégie: My question is for Dr. Cardoso. In your presentation, you said that 98 per cent of users consume heroin and that 50 per cent use other hard drugs. What percentage of users consumes marijuana?
[English]
Dr. Cardoso: First, I mentioned that 1997 was a huge problem. In 1997, those who were in treatment, 98 per cent were heroin addicts and 50 per cent injected the drug. Now we have 6 or 7 per cent injecting, and heroin consumers are only 10 per cent or something like that of all who are in treatment. The majority of illegal consumers and users are from cannabis. In fact, 25 per cent, if I remember well, of those who went to treatment.
In general, our prevalence of consumption in a lifetime of cannabis was around 10 per cent; less than 10 per cent in the population surveyed between 15 and 74 years. In the young population between 15 and 34, we have around 15 or 16 per cent. And in the youth, from a survey that is applied at 16 years in schools, we have around 15 per cent saying that in a lifetime they experience cannabis.
Senator Omidvar: My question is to our guests from Portugal and maybe Ms. Santos, given your title. I’d like to explore the impact of decriminalization in your relationships with international communities. Were any sanctions levied against Portugal as a result of decriminalization? How was your relationship with the EU impacted? Do you have any information if your citizens have seen an increase in denial of entry to the United States because of decriminalization?
Ana Sofia Santos, Head, International Relations Division, Serviço de Intervenção nos Comportamentos Aditivos e nas Dependências (SICAD - Portugal): Concerning your first question, in the beginning, when we decriminalized in 2001, there was an understanding from the United Nations, mainly from the International Narcotics Control Board, that this option that Portugal took at the time was not within what was defined by the conventions. We had two missions from the International Narcotics Control Board to Portugal. After the second mission, they stated in their annual report that, in fact, the option that we took in Portugal was within what was defined by the conventions because the consumption is still prohibited, but it’s no longer a crime.
We still have an administrative sanction to the use, possession and acquisition of the substances. Concerning trafficking, nothing really changed from what we had before.
There was, I would say, quite a lot of discussions with the UN. Of course, during these years we received — and we still today receive — a lot of foreign delegations from around the world to visit and to see how we put this system in place.
Finally, in 2016, when we had the United Nations special session in New York, at that time the chairman of the International Narcotics Control Board made a presentation and said that, in fact, Portugal should be considered a best-practice model within the parameters of the conventions.
So I would say that it took some time for the United Nations to realize that we were within the conventions.
Concerning our relations with EU countries, I wouldn’t say that it changed the relations we had with our partners. Of course, in the beginning there was quite a lot of curiosity. We received a lot of invitations, and we still do today, to present our policy. There was, in fact, other countries, like the Czech Republic, that more recently than Portugal decriminalized.
On your last question, in fact, I don’t have the data. I don’t have information as to whether there was any consequence of this policy in what concerns the entrance of Portuguese citizens to the U.S.
Senator Galvez: Thank you very much for your statement.
When we deal with drugs, the policy alternatives go from prohibition to decriminalization to legalization, and here in Canada we are also allowing commercialization. So we are making a big jump.
From what Dr. Kenneth Finn mentioned, it comes with a risk, and I want to reduce the risk. I would like to have your opinion on setting a maximum concentration of THC, the age at which we should allow young people to smoke joints, labelling and homegrown. Can you can advise what your position is on those?
Dr. Finn: First, I would not encourage smoking. Cannabis is well known to have and carry similar carcinogens to tobacco smoke. Even with vaporization, you still get some of those chemicals. In Colorado, a lot of the products have been found to be contaminated with heavy metals, which can cause cancer. They can be contaminated with fungus, pesticides, rodenticides, et cetera. As a physician, I would not recommend any type of smoking.
As you know, in the Colorado experience we have a significant number of home grows. The cartels are coming from all over the world and hiding in plain sight under the law. It’s really taxing a lot of our resources from law enforcement and DEA. What they do most of the time these days is tackling the home grows, because there’s really no monitoring other than neighbours reporting noxious smells, and that will be the tip-off for them to go in and eradicate those home grows.
Regarding labelling, that was one of the task force things that we worked on, and I was on the governor’s task force for Amendment 64. Part of our project, in the consumer safety and social issues workgroup, was to talk about labelling. Do not make these things attractive to children. Do not have candies, gummies, cartoons or advertising that entices young people.
Dr. Cardoso: Not having legalized cannabis use, we didn’t discuss labelling. We only see that the THC concentration is related to effects on health. Any discussion on health issues needs to be involved with the identification, and maybe, when legalizing, identify the concentration of THC or cannabidiol or its components of cannabis. In our opinion, that is of the most importance to consumers concerning the related health problems.
Senator Raine: My question is also directed to our witnesses from Portugal. Because it is no longer a crime to possess and use any drug in Portugal and your police are now able to focus on the suppliers of drugs, which is still illegal, how does a person who is a drug user get their supply legally without breaking the law or without dealing with the criminal element?
Dr. Cardoso: Dealing is always a crime, and you have to go to the dealer to buy any substance. What the police don’t do is go against the consumer. But even in that case, if they catch someone using or in possession of the substance, they send them to the commission. The idea is not to put them in jail but send them to that commission and try to keep them out of the consumption.
Senator Raine: Does the commission supply, for drug addicts, the drugs that they want to use?
Dr. Cardoso: I didn’t understand. Sorry.
Senator Raine: Does your health system provide drugs to addicts to keep them away from the criminal element?
Dr. Cardoso: Even when they are found by the police, the drug is seized. The only substance you give to addicts is some medicines like methadone or buprenorphine. In some countries of Europe, they use heroin-like medicine. In Portugal, we don’t use it. So the acquisition is still illegal.
The Chair: You have this commission. You have a fine system for the consumer. They’re fined, I understand, anywhere between 25 euros and 150 euros, but the commission can also provide other sanctions, such prohibitions on frequenting different places. What if the consumer doesn’t pay the fine or can’t pay the fine — maybe they’re too poor — or violates one of these sanctions? What do you do then? Do you still not send them to jail? How do you rectify this matter?
Dr. Cardoso: No. In fact, we have to stress the main objective. The main objective is to look at these people like people who need help or treatment for stopping consumption, not to punish them in any way.
The first idea, and even the fee, only could be applied if it’s not an addict, only an occasional consumer or the second time he’s found consuming by the police. The idea is trying to dissuade the consumption.
Senator Poirier: Thank you both for your presentation.
Dr. Finn, you didn’t paint a pretty picture. I can tell you that. A lot of what you’ve mentioned, I did start taking notes, but there were so many I didn’t catch them all. A lot of the increases that you’re seeing and talking about are also a lot of the items that we’re seeing that people are fearing with the legalization of marijuana, also of the increased cost to health care and the increased risk to your health, among many other things. I thank you for sharing those with us.
My question is going to be on the THC level potency. In Colorado, at the beginning, if I’m understanding right, there was no limit of regulating the THC. In 2016, some legislator proposed an amendment of the limit of THC to 16 per cent. In your opinion, should we be looking at the THC levels to prevent the high potency of the product?
Dr. Finn: If you’re going to limit it, limit it to 10 per cent. The products that are available in Colorado can push the 95 per cent, and we’re seeing, with my friends and colleagues in the emergency department, a significant increase in the number of people presenting to the emergency department with psychosis.
There was a friend and colleague of mine in the emergency department, as an example, who had a young 16-year-old with no psychiatric history who ended up using a high-potency product and ended up having to be restrained, tased, ended up stabbing a security guard in the face with a knife, ended up assaulting his family members where one of the family members ended up in the intensive care unit. A lot of these things have to do with the potency.
You have the Kristine Kirks of the world, who was shot in the head by her husband, who was on a high-potency product. You have Levy Thamba, who jumped off a balcony because he ingested high-potency products.
You have adolescents and youths using vaporizing pens at school, because it doesn’t smell, with very high-potency products. The vaping data shows that kids who are vaping the e-cigarettes are more likely to go to marijuana compared to the ones who are not vaping and are less likely to use marijuana.
The potency is a huge issue. An example, a colleague of mine this morning sent me a text about a person presenting in the emergency room with cannabis hyperemesis syndrome for the third time this week. The increase in utilization of the health care system is really starting to tax, especially in the community where she’s at that does not have a lot of resources and is less financially well-off, lower socio-economic status, et cetera.
The potency is a huge problem, and I would strongly limit it to 10 per cent.
Senator Manning: Thank you to our witnesses. My question is for Dr. Finn.
Could you estimate what legalization has cost the health care system in the state of Colorado since the policy was introduced? I know you did some work on that, a case study.
My second question is that, if I heard you correctly, municipalities opted out by 72 per cent, I believe you said? I’m not 100 per cent sure. In our legislation that we’re proposing here, there’s no option to opt out, so I’m wondering if you can explain how that works. I understand, also, that your age is 21 years and our legislation is talking about 18. Maybe you want to comment on that.
Dr. Finn: That’s part of the problem. When you have medical marijuana laws allowing 18 and above, a lot of these kids are in high school and they can become medical marijuana patients, and because they can’t get that at 21, there’s that gap. So these young kids can become the school drug dealer because they can get their medical marijuana card and there’s no good tracking system of the medical marijuana patients going to certain dispensaries and purchasing a daily limit.
The other issue is that the ones that are 21, they’re medicinalizing their recreational use. They’re self-diagnosing and managing medical problems. Because we have this two-sided coin of is it medical, is it legal, what is it?
But I think the cost is huge. The two legal drugs we already have, alcohol and tobacco, generate a lot of money for their respective industries, but they sure cost society quite a bit of money. I haven’t read or found anywhere else yet that marijuana will be any different.
We are seeing that in Colorado. I did a study just on my local community, about a $20-million loss. If you extrapolate that to the state level, that is potentially a $500-million loss in that time frame of 2009 to 2014, just on the cusp of legalization.
So there are all these other public health concerns and effects that we need to be aware of. There are effects on the reproductive system. There are effects on maternal/fetal and on the cardiovascular system. Just like the other substances we already have, there’s potentially a huge societal cost coming down the pipe.
So the question to your question is: Why did 72 per cent of the municipalities say, “Okay, we voted for it, but we don’t want it in our backyard”? Not just a few, but the vast majority of municipalities said, “We don’t want it in our communities.”
Senator Manning: In the legislation, they had an option to opt out. Right?
Dr. Finn: They had an option to opt in or opt out. Colorado Springs is the second-largest city in the state and we opted out of having legal marijuana, but again, we have 500 illegal grows in our community, so that does say something.
Senator Campbell: Thank you for coming today, doctor. Do you happen to be familiar with a group called Smart Approaches to Marijuana?
Dr. Finn: Yes, I’m familiar with them.
Senator Campbell: Are you a member of them?
Dr. Finn: I am not.
Senator Campbell: It surprises me, because your stats virtually mirror everything they say. Quite frankly, I’d like to address two of them.
Hospitalization and ER. There’s this great surprise on your part that when marijuana is legalized, suddenly people start showing up in the ER. I would suggest to you the reason they’re able to show up in the ER is because when they have difficulties, with marijuana being legal, they can actually go get medical support for, as you point out, mainly it’s psychotic episodes that they find. It should come as no surprise. Everybody is making a big deal about this, but it should come as no surprise to us that when you legalize, people will take advantage of the medical facilities that are available rather than taking a chance on having their children taken away from them, being arrested and the cops being called. Would you agree with that?
Dr. Finn: I would. I mean, that’s part of the social norming. When a substance becomes more available and readily accessible and people find that it is safe or reportedly safe — herbal, green or whatever descriptor you have. With legalization comes increased use. With increased use comes increased problems. With increased problems come visits to the emergency department.
Senator Campbell: The SAM report was 2013, which basically started this whole thing. But in 2017 — and there’s a report that’s coming to all senators — there’s a Colorado report that suggests that some of the public health initiatives with regard to cannabis-related harms are actually positive and are actually moving forward.
The second thing that I want to address — and again, your stats, it’s the same type of thing from SAM — is this opioid use and overdose. Surely you’re aware that there’s an epidemic of overdoses around the world. It doesn’t matter whether you have marijuana legalized or marijuana not legalized, those overdose deaths are going up. Would you agree with that?
Dr. Finn: Yes. I think that what I would agree with is that the opioid overdose deaths are going up. This was a little dip, if you look at some of the data, between 2014-15, 2015-16, but the numbers from 2017 show another increase in opioid overdose deaths.
Senator Campbell: Just for your information, we’re doubling in Canada. We’ve doubled in one year our deaths. So we’re familiar with that.
Dr. Finn: Actually, cannabis use is a predictor of opioid misuse.
Senator Campbell: Where is the stat on that? Where is the science of that?
Dr. Finn: The data came from, I think it was, Olfson’s article in the Journal of Psychiatry recently. They looked at a number of 34,000 people, and they did these studies showing that cannabis use increases the risk of non-medical prescription opioid use and opioid use disorder.
Senator Campbell: I have one last question. There’s this Livingston et al., which is a paper put out in 2017. In Colorado, they found that with legalization, in fact there was a 6.5 per cent reduction in overdose deaths — and this is a scientific paper — versus the rest of the country, which averaged 6.5 increase, Kentucky leading them. We’re going along with this idea of gateway drug, all the rest of it. The fact of the matter is that marijuana and opioid overdose deaths are not a connected or relation of fact.
The Chair: Do you have a further comment?
Dr. Finn: Yes. I think there are some weaknesses to the Livingston study from the Journal of Public Health. He looked at some of that data, but he didn’t take into consideration a lot of other factors, including the increase and widespread use of Narcan, which is a reversal agent for opioid overdose. He didn’t take into consideration the fact that physicians are more reluctant to prescribe and patients, in my experience, are reluctant to receive opioid prescriptions. There was also, at the same time, rescheduling of hydrocodone from schedule 3 to schedule 2. There are other factors other than just the fact that marijuana is there, therefore we’re going to have opioid —
Senator Campbell: No —
The Chair: Senator, we’re out of time. You’re out of your time and we’re out of time totally for this. The statistics are mind-boggling on both sides of this issue, I must say.
But let me thank Dr. Finn. I’m sorry about your travel being so complicated in getting here, but thank you for coming.
Thank you very much, Dr. Cardoso and Ana Sofia Santos. Obrigado. Have a good day.
In this second panel, as in the case of the first panel, we will focus on other jurisdictions, and in this particular case, two states of the United States. From Alaska, I welcome Dr. Jay Butler, Chief Medical Officer, Alaska Department of Health and Social Services; and from the Washington State Liquor and Cannabis Board comes Mr. Rick Garza, who is joining us by video conference.
Gentlemen, welcome to both of you. We appreciate your contributing to this discussion. I would like you, first of all, to give us up to seven minutes of opening remarks, and then the committee will engage you with questions.
Dr. Jay Butler, Chief Medical Officer, Alaska Department of Health and Social Services: Thank you, Mr. Chairman, and good morning, members of the Senate Social Affairs Committee. I appreciate the opportunity and the invitation to speak to you today.
For the record, I am Dr. Jay Butler, Chief Medical Officer, Alaska Department of Health and Social Services, and also immediate past president of the U.S. Association of State and Territorial Health Officials.
Although marijuana remains illegal at the federal level in the U.S., it has now been legalized in nine states, and nearly one in four Americans live in a state where state law allows possession and retail sales.
As a health official for a jurisdiction where possession and retail sale of marijuana was legalized in 2014, I’ll focus my comments on three public health concerns regarding marijuana use and the public health approaches to mitigating those concerns. I will be happy to discuss other issues related to the potential health risks as well as benefits during the question and answer period.
The first public health concern is underage use, both intentional and unintentional. In Alaska in 2017, 41 per cent of high school students reported ever trying marijuana and 21 per cent reported having used in the past month. One in 10 reported having used for the first time at age 13 or younger.
However, over the past decade, these rates have changed little. Like Colorado, Alaska has been a state where, historically, use has been higher than national averages.
However, there has also been an increase in the proportion of teens who believe that there are few or no health risks associated with marijuana use, and similar trends have also been reported from other states.
Of concern is problem use and dependency, which is reported to develop in up to one in ten regular users. The risk of problem marijuana use is nearly twofold greater for those who initiate regular use during adolescence.
In Alaska, as well as other states with open retail stores, sales as well as possession are restricted to persons aged 21 years and older. This aligns with age restrictions in all states on alcohol sales and, now in five states and over 300 cities, sales of tobacco products.
An increase in unintentional intoxication among young children was mentioned earlier due to ingestion of THC-infused edibles in Colorado. The problem is being addressed by requiring packaging and branding that clearly marks the item as containing tetrahydrocannabinol, or THC, packaging that is unlikely to be attractive to children, child-resistant packaging and limiting the amount of THC in a serving or in a single package. In Colorado, Washington and California, the THC content in a serving is set at 10 milligrams. In Alaska and Oregon, it is 5 milligrams. In all five states, a single package cannot contain more than 10 servings.
A second area of concern that was mentioned earlier is use during pregnancy. THC crosses the placenta and enters the fetal circulation. Animal studies suggest that exogenous cannabinnoids may interfere with the action of the naturally occurring cannabinoids that contribute to normal fetal brain development. In humans, use during pregnancy has been linked to lower birth weight.
A recent report from California demonstrated that use of marijuana during pregnancy, particularly among younger women, has increased, and roughly one in five pregnant women under age 24 reported having used marijuana in 2016 prior to legalization. Data from multiple states indicate declining perception of risk of use during pregnancy, although there have been few new data documenting either safety or risk.
In Alaska, we have focused on providing information to pregnant women and their health care providers on the currently unknown safety profile of marijuana use during pregnancy. We have developed print and social media materials that address alcohol, tobacco and marijuana use during pregnancy under the message of “legal is not the same as safe.” These materials are available through health care providers’ offices, social service agencies and marijuana retail outlets. I’ve provided some of the printed forms of those materials, and I know they will be available to you later today.
The third area of concern is driving under the influence. There’s clear evidence that cannabis impairs driving and increases crash risk. Higher blood THC concentrations slow reaction times, limit peripheral vision and increase variability in speed and lane position. Impairment by THC appears to be dose-related and is enhanced by concomitant use of alcohol.
In Alaska, we are addressing driving and boating while impaired as part of a broader public health message, “be a responsible user.” This has included video broadcast and social messages developed by the Division of Public Health with input from community marijuana users and actually delivered by some of the retail store owners. The reason for that is in doing community focus groups, we found when it comes to marijuana use, users don’t believe me; they don’t believe their doctor; they don’t believe the government in general, but they will listen to the retailers.
It is important to note that there are a number of limitations in the data from the U.S. on the public health effects of marijuana legalization. First of all, there are only a few years of data available. Colorado and Washington legalized in 2012, followed by Alaska and Oregon in 2014. It takes a number of months, if not years, for the commercialization and the retail regulation and establishment of a market to get up and going. It’s really too early to draw many firm conclusions.
Second, although there are available data from earlier epidemiological studies, the retail marijuana that is available in 2018 generally has much higher THC content than what was available when many of us were young, as was mentioned earlier.
Finally, there are many more modes of administration than in the past. In addition to the traditional joints and brownies, the emerging retail market includes THC-infused beverages, concentrate oils and tinctures, vaping solutions and topical products, in addition to a whole cornucopia of THC-infused products, everything from baked goods to salad dressing to barbecue sauce.
I’ll close by encouraging you to consider marijuana as a unique product. While there are public health lessons to be learned from the regulation of alcohol and tobacco, it is important to not conflate the health effects of those products or the optimal public health approach to each.
I look forward to the discussion that will follow. Thank you for the opportunity to speak to you today.
The Chair: Thank you such, Dr. Butler.
Rick Garza, Director, Washington State Liquor and Cannabis Board: Good morning, Mr. Chairman and members of the committee.
With only seven minutes, I’ll begin by stating that the model that was used in Washington — and again the initiative was passed November 2012 — is modelled around the model that was used coming out of Prohibition in 1934. It’s interesting that the author of the initiative looked at how we came out of Prohibition, such as very strict requirements for licensure to make sure we keep the criminal element out; and policies, rules and laws with respect to youth access.
So I’ll share that, as the first two states in 2012, we waited nine months to hear from the federal government as to whether they were going to allow us to move forward with this experiment, knowing that it defied the prohibition federally.
The Cole memorandum was provided nine months later, in August 2013. It really is the guiding principles around which we set up our regulations. There are three areas, and one was just that we had some details from a doctor from Alaska. But I would say that, because of the committee’s work, I want to focus on the restricting-youth-access piece.
We do compliance checks as the liquor regulatory in Washington, and we have for over 80 years. We are using the same program in Washington for cannabis retailers. It’s interesting that the initiatives set up the same program. In fact, the model for alcohol regulation in Washington is modelled after British Columbia to our north.
We do compliance checks in Washington — three to four compliance checks for each retailer a year. We have tight security requirements and penalties for sales. The youth compliance rate for the last four years in Washington has been about 92 per cent. That’s even better than the compliance rate that we have for alcohol retailers, which is somewhere between 84 and 90 per cent. The reason we’re doing better with respect to cannabis is that we have fewer retailers.
We actually use the same model. Until 2011, the state was the retailer of spirits, similar to the way some Canadian provinces retail alcohol. We used that same model. We only allow 500 retail stores statewide. We have a population, as you’re aware, of over 7 million. We do many compliance checks per year.
Also, we were about six months behind Colorado, and we saw some of the things that were happening with respect to edibles and infused products. The board by emergency rule adopted a rule that stated that no edibles or infused products could be especially appealing to children. Little did we know that in the black and grey markets of medical, many infused and edible products were appealing to children: gummy bears, lollypops, cotton candy and ice cream. So we actually wrote an emergency rule. We have a four-person committee at the Liquor and Cannabis Board that reviews all packaging, labelling and product for edibles and infused. That has kept some of the bright colours and things that we saw in the black and grey markets out of our market.
I think there was a question or a comment earlier about what we’ve seen in the last four years with respect to youth use. In Washington, we have what’s called a Healthy Use Survey. It’s done every other year — 8th graders, 10th graders and 12th graders — in our high schools. We asked one basic question throughout that, which was around use in the last 30 days. We’re very interested in looking at what would happen there. We were expecting to see in the health and prevention community an increase in those 8th and 10th graders with respect to use in the last 30 days. In 2012, it was 17 per cent. In 2016, it was 17 per cent. I think the prevention community and the health community were surprised to see that there wasn’t a significant increase. In fact, in some counties in south Washington, it actually decreased, which we don’t really understand.
The one area of concern in the survey was that the perception of harm had gone down. Again, typically when that happens, you would expect to see an increase in use, but we didn’t see that.
I’ll share with you, because there’s so much anecdotal information with respect to the harms or not harms, depending upon whether you are an opponent or not of legalization. The Healthy Use Survey has been out in the communities and schools for over 50 years, and we use that as a benchmark to determine use, not only of cannabis but of all drugs.
I also wanted to share something that’s been interesting. One of the things we didn’t expect was the clash of cultures. I’ll share with you that the initiative passed 56 to 44 per cent, so there’s a sizeable population in Washington that voted “no.” Some of the things we didn’t expect that we saw that I would share with you is advertising. There was a real clash there between those who are now finally seeing that legalization had occurred and that the industry was advertising, as anyone would advertise a product. There was a real clash with citizens that led to these last two years’ restrictions in advertising by the legislature and signed by the governor — restrictions for billboards. We were seeing signs up and down busy streets and inflatables.
We have a pretty large enforcement for cannabis and alcohol in Washington State, and the number one complaint we got from the public was advertising. Of all the things you’d think you would see, we were surprised to see that advertising was the biggest concern. That then led to further restrictions upon the industry.
Another thing was banking. We’ve been fortunate. We have three state credit unions and state chartered banks that allow banking because of the way that we vet our licensees. We go through a pretty extensive process to vet our licensees, just as we did for liquor. We go through a background check, fingerprints from the state parole in Washington State and also through a contract with the FBI. So we also vet not only the applicant but, the way the initiative was written, we also vet financiers and investors. We do a financial background. We want to know where the money came to establish the business. Again, this is trying to make sure we keep the criminal element outside this industry.
I think I’ve come to my seven minutes, Mr. Chairman. I look forward to any questions you may have. Thank you.
The Chair: Thank you very much. You both packed a lot of information into seven minutes. We’ll get some more information via our questions now.
Senator Seidman: Thank you very much for your presentations.
I will address my question perhaps to Mr. Butler first. I’d like to ask you specifically about your experience in testing and regulating THC content in Alaska. You alluded to some issues in your presentation, but there was a recent article in the Anchorage Daily News, within the last few days, actually, which quoted a member of Alaska’s Marijuana Control Board as saying:
Alaskans have an obsession with marijuana that tests over 20 per cent (THC).
I understand this quote was in reference to revelations that advertised potency on labels is frequently inaccurate. In addition to the apparent rise in faulty testing, the demand for high-potency marijuana has created strong financial incentive for growers, retailers and test labs to game the system.
I’d like you to speak to the growing demand for high-potency marijuana in Alaska and the challenges in labelling and testing in the labs.
Dr. Butler: Thank you, senator. If I didn’t know better, I would swear you looked at my notes where I decided what topics I would address in question and answer.
Testing is a topic that we haven’t discussed very much today. You actually bring up a number of issues there. Let me start with the item of high potency.
One of the ways that it’s important not to conflate marijuana with, say, alcohol, is alcohol is generally not assessed by the consumer for its quality by the alcohol content, whereas oftentimes marijuana is. There’s a desire for the higher level of THC, at least in the current market, based on the analysis that I’ve seen.
One of the challenges that we’ve had in Alaska that relates to regulation, and that I think is pertinent to your deliberations — and I suspect Mr. Garza would like to comment on this also — is the challenges we’ve had with the testing to document the THC content for the consumer.
In Alaska, the permitting process allows commercial labs to do that testing. There is quality oversight by the state, but the actual collection of the specimen and standardization of protocols has not been as well developed. So we actually have a testing working group going through the process of lessons learned connecting with the other states of how we could do a better job with that.
Right now, the law in Alaska is that the label needs only disclose the amount of THC. There are other states that also require disclosures of cannabidiol content and, as was mentioned earlier, there are other concerns about heavy metals, pesticides and contaminants such as moulds within the product also.
If there’s a recommendation I would make, I think you want to think long and hard about how to standardize the testing process so that you get accurate measures. If you’re going to do this in a way that is as safe as possible for the consumer and so that the consumer can be informed, the testing procedures have to be standardized.
Mr. Garza: You could have written that article in Washington State, not just in Anchorage, because we’ve had exactly the same issues.
In fact, this last legislative session, one of the problems that we had earlier on, to be honest with you, is many of the State agencies that we would have typically worked with for lab standards, for example, or for certifying environmental labs, were reluctant to get into this space because of the federal prohibition and because of some of the funding they received from the federal government.
It took a couple of years for our partners in the other agencies to step forward, and it really meant a lot of pressure from the legislature and the governor to assist the agency. Unlike California and some of the other agencies or some of the other states, the liquor control board at that time was given primarily all the responsibility for setting up the system. We had to work with the Department of Agriculture, for example, who certifies the kitchens that are used for those that process cannabis, but even that was difficult in the beginning. I think you had a program for medical cannabis in Canada for quite some time, so I assume you don’t have those issues.
We had many of the issues that the senator spoke to in the Anchorage article, and we still have them today because with lab standards for measuring potency or for measuring pesticides, for example, there’s no set rule out there. We actually had to use rules that were adopted in the State of Oregon because the Department of Agriculture in Washington was reluctant to provide what pesticides should be used or not used. Again, in Washington, we would typically turn to the EPA, the Environmental Protection Agency, the federal agency, that would give us assistance and technical assistance with respect to what pesticides can or cannot be used and what are the action levels with respect to those pesticides that can be used or not used.
We did get agreement this session, and a proposal will be coming back from the department of ecology that actually certifies labs. In fact, we had the same issue with commercial or private labs. We have 16 that are certified in Washington. We actually moved funds from the liquor and cannabis board to the Department of Agriculture to buy the proper equipment so that we could do testing for pesticides because we were having the same concerns about gaming that was going on with those commercial ventures.
One of the things that I want to speak to for one moment is the issue of potency. It’s something that we’ve talked about in the last year. Some have suggested you might want to consider taxing by THC potency, because what we’re seeing — and we’re seeing it throughout the States — is that people are coming in and looking for the highest potency of THC in products. That has raised the issue of whether, unlike the way that we tax it today, we should be looking at taxing it by THC potency.
I’ll end with that, Mr. Chairman.
Senator Petitclerc: I would like to hear both of you on my first question, and maybe Dr. Butler first.
In your respective states, have you considered — or maybe it’s existing already — safe guidelines for the use of cannabis? I’m thinking about it because we had some witnesses saying that it would be possible to come up with those guidelines, but we don’t have them here in Canada. With alcohol, for example, we have guidelines for what is safe consumption for women, for men, per day and per week. Does that even exist, or is it something that is considered in your states? Who should provide those guidelines to consumers?
Dr. Butler: Senator, thank you for that question.
It’s certainly a discussion that we have. I think the biggest challenge is the dearth of good scientific data to guide that discussion. That’s where I sometimes find the discussion begins to try and pull data out of tobacco and alcohol, which again I would encourage you not to do.
We have focused primarily on guidelines that address the health concerns. For instance, when using edibles, we have put out statements like “go low and start slow”, something like that. That is, don’t keep eating, waiting for the effect. It’s going to take 30 to 60 minutes for the effect to kick in.
Also, we have messages regarding the effects on driving. One of the real controversial areas is trying to figure out just when it is safe to drive after using it. Of course, that’s also going to be influenced by whether you’re smoking or vaping or using edibles. In the case of edibles, we have gone longer, encouraging people not to drive within eight to ten hours after consuming.
We’ve also encouraged people not to use alcohol and cannabis together, particularly when it comes to driving under the influence, because the two substances seem to impair driving when used together more than either one used in equal amounts alone. The brain compensatory mechanisms are each compromised by the other substance.
Senator Petitclerc: Thank you.
Mr. Garza: Senator, that’s a great question.
My counterpart from Colorado and I were before the National Institute on Drug Abuse in Washington, D.C., last year. So much of this is about a lack of research and science around cannabis. You’re absolutely right. Years ago, NIDA suggested that, depending upon the gender and the weight of a person, you could consume amounts of alcohol, wine or spirits.
I asked them the same thing. We would like the ability to be able to tell the consumer that this is a level of consumption that would possibly be safe or not. They kind of looked at me like they didn’t know what I was talking about and we don’t have any way of knowing. Consider how people consume this product, which is different, obviously, than alcohol. You have different ways. It’s combusted, eaten, drunk, and how you would know what that is.
It’s a great question because we’ve asked it. We’ve asked NIDA and others to do research around what a safe level of consumption is for cannabis. But as far as I know, I’m not aware of anyone who has done that work.
Much like the doctor from Alaska just stated, we’re doing a lot of messaging, very identical to what they’re doing around what you need to be aware of regarding edibles and other ways it’s consumed.
The Chair: Let me slip in a question here if I might.
We’ve had some people in to talk about home cultivation. Home cultivation, according to my chart, in Washington is not permitted, but in Alaska they are allowed six plants per adult. I would like to hear briefly what led to the decision in those two different states, and how is it going? How is it working or not working? I’ll start with Mr. Garza this time.
Mr. Garza: It’s interesting that we’re the only state that has legalized adult-use cannabis that doesn’t allow for home grows. It really came down to what the initiatives said. The initiative did not allow home grows. There have been proposals in every legislative session for the last five years to allow home grows. The perspective from law enforcement is if you’re creating a legal market, why do you need to create an opportunity for folks to grow for themselves and possibly sell out the back door?
When I consulted with the states of Colorado and Oregon, they said, “If I could go back and change something, I would not have allowed for home grows.” I think it was part of the compromise in the initiative or, in the case of Colorado, a constitutional amendment, and it was really about the ability for people to grow for themselves. The limits they placed were very high. It was 99 plants in Colorado. In fact, in the last couple of years, they reduced that to 16 plants. What was happening was people were coming into the state from other states, cultivating and then taking it back to their states. So there was a large amount of diversion that was occurring in those states. I think the issue is not so much in the state but it’s the ability for folks to come in and grow on their own and then export it out of the state.
We’ve heard from law enforcement their concern with respect to that. But we do allow for cooperatives and home grows for medical cannabis.
Dr. Butler: The story in Alaska is really based on the history at the time when Ballot Measure No. 2, which led to legalization in 2014, passed. It was on a background of nearly 40 years of quasi-legality of marijuana for personal use and home grow in the state. This was based on a State Supreme Court case, Irwin Ravin v. State of Alaska. The ruling in 1975 interpreted the state constitution’s guarantee to privacy as including the right to be able to grow and possess small amounts of marijuana in the home. So we’ve had literally decades of varying degrees of decriminalization, near legalization, on which the full legalization with retail sales permission was launched in 2014. So there has not been talk of putting the genie back in the bottle when it comes to home grow.
The Chair: Is there some law enforcement of the six plants, or is it only on a complaint basis?
Dr. Butler: Again, I’m not a constable. When I talk to my law enforcement colleagues, I don’t hear a lot of discussion of this topic, although I’m usually talking about more dangerous, illicit drugs when we’re in conversation.
Senator Omidvar: I have a question for each of our guests.
Thank you so much for your testimony, Dr. Butler. You’re a chief medical officer of health. Could you help us understand from your point of view the social harms associated with criminalization of cannabis.
Dr. Butler: Senator, the social harms that I would worry about is whether or not marijuana use can limit a young person’s ability to succeed in life. That is a statement that could probably be used by both proponents and opponents to legalization. We certainly have concern that marijuana use has been associated in studies with use of other types of illicit substances, although I think, when we talk about opioids, it’s important to point out that the risk is much lower than the risk that’s imparted from prescription opioid use.
I also want to add, as we talk about the opioid crisis, to keep in mind this is not the same opioid crisis we were dealing with five years ago. We’re seeing declines in prescription opioid overdose deaths. We’re actually seeing declines in heroin overdose deaths. What’s driving the epidemic right now is the influx of fentanyl, which is a different drug altogether in terms of how it’s used and the impact it’s having on people.
The concern that proponents will argue is that a criminal record related to marijuana, particularly if it’s simple possession or small-level sales, can mark someone for life and prohibit their ability to get a job. Again, I’m a doctor, not an economist, not a lawyer, but it’s very clear that among the social determinants of health, being able to get an education, being able to have a good job, is an important determinant for how to live a healthy life and be a productive member of society.
Senator Omidvar: Mr. Garza, since you’re with the Washington State Liquor and Cannabis Board, I imagine you have a lot of experience in dealing with the black market. Can you describe what pricing strategies you used to limit and contain the illicit market?
Mr. Garza: For the longest time, like Colorado, Oregon, and the first states that legalized, many of those states legalized by initiative medical marijuana and cannabis, and in 1998 for Washington. For many years, 14 to 15 years, we had a black or grey market for medical marijuana. It was very easy, because of some of the loopholes in how you could qualify for an authorization. In fact what happened in Washington, like many of the other states that legalized, is the medical market became the commercial, legal market for cannabis. In fact, it took two years.
Much of the medical community patients were against legalization of adult-use marijuana. They didn’t want to regulate it, and they didn’t want to have to pay taxes. Their concern was this was going to move against medical marijuana and that some day it would be regulated by adult use. Guess what? That’s exactly what happened. It took two legislative sessions because medical patients did not want to be regulated.
Finally, in Washington, unlike the other states, it is one integrated system. If I’m an adult-use retail store, I can obtain a medical endorsement on my licence to sell medically compliant product as defined by the Department of Health. That’s unique to the states. Most of the states have the medical anecdote use separated. And I’m not sure, senator, if I answered your question or not.
Senator Omidvar: Not exactly, but you gave us some very interesting information. On the issue of one market for both medical and recreational, did you notice a decline in the illicit grey market that you talked about?
Mr. Garza: We did an RFP early on, and this has been five years for us now, to find experts to help us figure out how we were going to set our systems up and how much cannabis would be needed to be grown. In fact, what we did is we hired Dr. Beau Kilmer with the RAND Corporation to come and actually survey cities and counties within the state to find out how much THC and how much cannabis was being consumed by those over 21 in our state. That’s how we built our system of 170 metric tonnes. The reason we had to do that was we had to convince the federal government that we weren’t going to create overproduction and divert product out of our state. You don’t have that problem that I’m aware of, but this was an issue we dealt with that was problematic.
I’ll share with you the size of the industry. Right now, we have BOTEC, and the reason I’m bringing that up going back out to tell us what percentage of the marketplace is legal today and what percentage of it is black market. We really don’t know at this point. We’ll know in the next few months. But we know that we went from $280 million in sales to $800 million in sales to $1.3 billion in sales, and now, in the fourth year of retail sales, we’re probably going to hit $1.6 billion in sales.
We have a 37 per cent excise tax on cannabis. It’s one of the highest in the country, but that excise tax has collected $1 billion for state government in the last four years.
We will find out. I think it’s safe to say that probably at least half of the market is legal and probably half is still black market.
The concern we’re seeing is that now that we have a legal marketplace and we’re talking about $7 a gram, which is pretty low as an average, we’re competitive with the black market. That began about two years ago. That’s when we saw the huge increase in sales occur, because we started very high. There was a low supply and once supply and demand were there, we were effectively able to compete with the black market.
I think the concern the federal government has is that what’s happening is the illicit and black market, because they’ve lost their sales and because of the low cost in Washington, is diverting product out of the state. In other words, if I pay $1,000 a pound in Washington for cannabis and I can get $3,000 or $5,000 in the South or Midwest or on the East Coast, then I’m going to move product to another state where I can make more of it than I can in Washington.
The Chair: I have a quick follow-up with Dr. Butler on this statistic you gave, Mr. Garza. Although you’re still testing it to determine its accuracy, you think it might be about 50-50 at this point between the legal market and the illegal market. What would it be in Alaska?
Dr. Butler: Senator, I would only be taking a wild guess to come up with an estimate like that.
I would like to add that the situation in Alaska is a little different in that around 1998 we also had medical marijuana laws that were passed, but there was no provision for how to obtain the marijuana. That was built on the Ravin decision and it was assumed that you would be growing your own or small amounts would be gifted, but ultimately the medical marijuana card only served primarily as an affirmative defence if you got into trouble.
We never had as high a participation rate as the states that distinguish recreational from medicinal use, particularly states like Colorado, which have had a different tax structure. Even with our retail stores now, we do not distinguish. It is all retail marijuana, and how you use it is your own business.
Senator Poirier: Thank you both for the presentations. I have questions for you both.
I will put my first to Mr. Garza. You mentioned in your comments the advertising issues. You had given us a bit of information about the advertising restrictions that were added just recently. I’m assuming there must have been some kind of advertising rules that were put in place when this was introduced, but in 2017 you felt there was a need to change the law. Was it because the retailers were not complying with the advertising law that had been put in place at the beginning, or was it to the fact that their laws were not severe enough when it did start? You talked about the billboards. What do they look like at this point?
Mr. Garza: One of the things I would share that I didn’t have a chance to do earlier is the initiative created restrictions of 1,000 feet. The retail producer or processor licences can be fixed as far as a location. They can’t be within 1,000 feet of seven entities, like parks, schools, transit centres, libraries and anywhere children would typically be present. That’s a restriction that was placed in the initiative, and it also applies to advertising. No advertising can be within 1,000 feet. It’s really to address billboards or businesses or people who would advertise near a school, for example.
I think what happened, again, was that because 44 per cent of the voters of our state voted no, they didn’t expect the industry to use the same type of advertising techniques and tools that others used, and that surprised everyone.
Some of the restrictions in the billboard advertising was anything that might be appealing to a child, but also just to the point that the plant couldn’t be in the billboard advertising, or smoke or anything that suggested the consumption of it. People were pretty imaginative in some of the billboards that they created and, in fact, I’d be happy to send you copies of some of the things that were created that really were a backlash, that the public looked at and said, “Look, I’m okay with this being legal.” Even those who approved the measure were concerned about the level of advertising with sign spinners. I think that was a little more than the public wanted to swallow. There was even an effort to outlaw billboards period, but there are obviously free speech issues there. I’ll share with you anything you can do, and I can send you specifically the new law and the restrictions that were put in place.
Senator Poirier: If you could send it to the attention of the clerk of the committee, it would be great to have that information. Thank you.
My second question is for Dr. Butler. You mentioned right at the beginning of your opening statement that although marijuana remains illegal at the federal level in the United States, it is now legalized in nine states and nearly one in four Americans live in a state that allows the possession and retail sale of marijuana. I wanted to talk about that for a little bit.
We’ve heard from different people over the course of this study about some of the issues relating to crossing of the Canada-United States border by people that may have smoked, may have had a record, may have been charged before, are asked if they’ve smoked in their life and have had Nexus cards removed. There are so many issues we’ve heard along that line.
I’d like to hear from you about how Americans are dealing with this when they are going into a country and coming back through different borders. If it’s an issue and you’re hearing about it, how do they deal with it?
Dr. Butler: I can address it in terms of how we’ve worked with the so-called hospitality industry’s concern that people who come into the state may not realize that what they purchase in Alaska cannot be taken out of state — not legally, anyway. That has been part of the early messaging, that what’s grown in Alaska stays in Alaska.
In terms of how Americans in general perceive that, that’s a little bit beyond my area of expertise.
We have had a lot of questions raised regarding the federal screening. If a federal security agent recovers marijuana, do they need to do anything? I think that’s one of those law enforcement issues that are still being worked out.
Senator Galvez: Thank you very much to both of you for your statements.
I want to talk about a little bit of the economics. The funds that you are collecting through the tax are huge. It’s big business. At the same time, you are saying that there is a lack of research. What is the government doing with the money? Is there some money coming back for doing the research in order to improve your regulations?
Mr. Garza: One of the things that was interesting that they did in the initiative, when they looked at how the revenues would be distributed, was they actually used, again, the older alcohol model for how revenues that were associated with alcohol sales for beer, wine and spirits would be distributed.
So $1 billion has been collected through the excise tax the last four years. I spoke to that. Half of that money, $500 million, pays for health care for the poor and low-income in our state. It’s the state Medicare program. Specifically, in the initiative, they placed monies in places other than just the state general fund. In other words, half of it goes to health care. A big piece of it goes to the Department of Social and Health Services for prevention and reduction-of-substance-abuse programs throughout the state. There’s another chunk that goes to the Department of Health for marijuana education and public health programs. That’s probably where the largest majority of the funds go. Unfortunately, only a small amount of that money goes to the University of Washington or Washington State University for research, and both of those institutions have raised the issue that they would like more funding from the state. It’s interesting that, initially, they were concerned about receiving any funds because they get federal funds, as major universities.
To your point, senator, I think that’s one thing that’s lacking in Washington and many of the states — funding to the major universities to really look at the research that needs to be done. I can’t say enough that one of the difficult challenges for this agency is: How do you make data-driven decisions and policy and rules, and even law, around cannabis when you don’t have the kind of research that you need to help to guide that?
Dr. Butler: Senator, to put the discussion into context, Alaska has a population about the same as New Brunswick, so about 750,000 people. Our projections for 2018 are that tax revenue from cannabis sales will be in the order of about 10 to $12 million. So it’s a significant amount of money. Our tax structure is different than many of the other states in that it is a weight-based excise tax that is placed upon the cultivators at the time of sale to either the retail outlets or the production facilities.
Initially, the plan was for tax revenues to go into the general fund. Last year, 50 per cent was designated to an anti-recidivism program to try to reduce our prison population. As I glance at the clock, I know our legislators are arriving at their offices in Juneau, and one of the items that I hope is on the agenda today is a bill that would designate 25 per cent of marijuana revenues to a public health education and prevention fund.
Something that I would also really encourage you to think about is that the management of retail marijuana, of legal marijuana needs to involve the work of Health Canada as well as your provincial health departments. Our goal is to be able to use those funds for community engagement to be able to address issues like education, parental involvement, supporting after-school programs, but also to be able to support the work of the state for surveillance, to be able to assess the prevalence of use, as well as the health effects. We keep just talking about the impact, and we’re always challenged with: Are these good data or not? Because we often have to deal with the caveat of temporal association. There are many things that have happened over the past 10 years, but I’m not sure we can attribute all of them to marijuana legalization.
Senator Raine: I’m very clear on how marijuana is produced. It’s grown, and I understand that there are some regulations around how it’s grown, the use of pesticides and rodenticides, things like that. Then it’s fabricated or produced into the products, which are then sent to the retailers. At each level, there is a regulatory regime set up. We have something in Canada that I think is quite unusual in that our medical marijuana, certainly in British Columbia, was all delivered by Canada Post. We skipped the retailer and went directly to the consumer. Did anything like that happen in either of your states?
The Chair: In terms of our medical marijuana, throughout Canada, it’s delivered by Canada Post, which is our postal entity. Do you do something similar in the state of Washington?
Mr. Garza: No, we do not. In fact, we don’t allow delivery for medical or adult-use cannabis. There’s a proposal. We actually were asked during this last session — and we’re working on it during the interim now — to bring in a proposal to allow for the delivery of medical marijuana. All of the states do it a little differently. I suspect that, in Canada, because of the distance, delivery makes sense, but through U.S. post, no. Cannabis cannot move through that system, and in fact, in Washington, there is no delivery option. It does make sense. We are looking at it. We just haven’t gone there yet.
Dr. Butler: The federal restrictions on mailing would still apply in Alaska, and we’re going through the rule-making process still in terms of home deliveries.
Senator Raine: Somebody from Washington that I spoke to at length on this — and he worked in the education system — said that we should proceed slowly and make sure we get it right at the federal level. Right now, what we’re doing is allowing a lot of additional regulations to be put in place at the provincial level. In a perfect world, what would you see should be controlled at the national level?
Mr. Garza: Senator, you said something that I didn’t speak to earlier. We have met with 40 states and 11 countries over the last four years, to share our experience. Typically, with Colorado, people are either on their way to Colorado or coming back from Colorado. You just said something that’s probably the most important thing, which is, “Take your time, and make sure that you do this correctly.”
Colorado started six months before us, and there was a hue and cry that, “Oh, my goodness, Washington State is behind.” We weren’t too concerned. In the discussions that I had with the governor and the legislature, it’s more important that you do this right. Nobody is going to remember how long it took to set the system up, but, if you mess it up, they’re going to remember. In all of this, it’s very challenging and very complicated. For us in Washington State and for the States, it’s most difficult because of the federal prohibition. The inability for banking is very problematic. The inability for a person to go and get a loan at a bank, which is typically how I would set up my business, having to rely upon my own capital or having to rely on investment or financing from people I don’t know is very problematic.
I just share with you, senator, that it’s all across the board. Whether it’s packaging and labelling, banking, pesticides, enforcement, I would take the proper time that you need to do it right. It’s interesting: Once you issue licences to this industry, then they create lobbying. That lobbying doesn’t exist today. The pressure that I’ve seen over the years as an alcohol regulator is often fighting with the industry that has lobbyists that will fight the regulations or the laws that we feel are important to protect the public. You don’t have that yet, or, at this point, you have not issued licences. That industry doesn’t have the power to fight you with respect to things that they typically would, that we see in the alcohol industry. I would just caution everyone that this is an important time for Canada to make sure that, in all of these areas, you take the proper time you need to do it right.
Dr. Butler: I’ll only add that I’ve learned much from Mr. Garza over the past couple of years, and I agree with everything he said.
The Chair: That completes round one. It actually completes the meeting too. We’re up to our deadline.
I want to thank both of you, Dr. Butler and Mr. Garza. You have been very helpful to us. You’ve given us very good information in a very concise fashion that helps in our examination of this. We thank you very much for being with us for this meeting.
Colleagues, I will ask you to stay for an in camera session that will go on another subject in just a couple of minutes. Members of the committee, please stay.
(The committee continued in camera.)