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Kentucky Legislators File Bill To Legalize Medical Cannabis

January 11, 2021

Lawmakers in the state of Kentucky have officially filed a new bill that seeks to legalize medical-use cannabis after Governor Andy Beshear (D) called for reform during a State of the Commonwealth address on January 7th. The proposed legislation is sponsored by Republican Rep. Jason Nemes, who introduced a 2020 bill that cleared the House but failed to pass in the Kentucky Senate. 

Gov. Beshear said that current cannabis laws in the state “unduly restrict us from growth and innovation,” continuing to assert that “it is time to legalize medical marijuana.” 

Details of the Proposed Kentucky Cannabis Bill 

The newly introduced bill calls for the state Department of Alcoholic Beverage and Cannabis Control to be responsible for regulating the medical market in Kentucky. All medical marijuana sales would be exempt from state excise taxes according to the proposal—a provision that’s sure to spark debate between the governor’s office and legislators. 

Gov. Beshear is looking to use the medical marijuana industry to generate tax revenue for the state, but top lawmakers have resisted, claiming that if cannabis is to be categorized as a medicine, then it should not be subject to tax. 

Unlike many other states, there is currently no set list of pre-qualifying conditions that would allow for residents to be prescribed medical marijuana. Instead, physicians can suggest cannabis remedies for any ailment or condition that they see fit. Patients would then be allowed to purchase a thirty day supply of cannabis, though they would not be permitted to cultivate their own plants at home. 

A medical marijuana trust fund will be established and administered through the state Finance and Administration cabinet, which will be responsible for processing revenue from licensing and registration fees and collecting monies from penalties. 

Potential Revenue Splits

The revenue would be divided as follows: 

  • 60% towards covering enforcement 
  • 13.75% to cover a grant program for local law enforcement 
  • 13.75% kicked back into dispensaries to help cover costs for low-income patients 
  • 10% to cover additional administrative costs 
  • 2.5% for implementation and setting up a grant program to promote the research of cannabis 

Additionally, a 12% excise tax on marijuana sales would be established between cultivators, processors, and producers. 80% of that excise tax revenue would be allocated towards the medical cannabis trust fund, while the remaining 20% would be distributed among local governments. 

Contributed by Jack Berning