By Olivia Oliver and Lily Wray
Arnolt Center for Investigative Journalism

INDIANAPOLIS – Advocates for marijuana legalization are making their voices heard at the Statehouse but remain wary to put cash toward a lobbying push in the Indiana General Assembly.

A summer study committee renewed discussions around medical and recreational marijuana legalization, with many fearing the state could lose out on millions in tax revenue if the General Assembly continues to avoid considering the topic. However, lobbying groups have put forth little financial support for legislative action, according to a report by the Arnolt Center for Investigative Journalism and The Indiana Citizen.

“I don’t think enough people are interested in the legalization yet and I think that the leadership in the Legislature needs to focus on it because it is a huge, missed opportunity if they don’t do something this year,” said Kip Tew, a partner at Ice Miller, which is representing Stash Ventures, a Michigan-based cannabis company.

Stash Ventures has ramped up its lobby ahead of the 2023 legislative session. The company spent $191,347 on lobby efforts in 2022, according to state lobbying disclosures. In 2021, the group spent $2,000.

But Stash Ventures is the sole player in the pro-marijuana lobbying game. Other groups advocating for legalized medical and recreational marijuana are making their presence known in Indianapolis but have yet to open their wallets.

Advocates including NORML, the Midwest Hemp Council, 3Chi, CuraLeaf, Hoosier Veterans for Medical Cannabis, HempRise, Wellness Tree farms and other groups spoke during hearings on legalization but none have put forth lobbying dollars.

Even the Marijuana Policy Project, a national group focused on cannabis legalization, has stayed hands off in Indiana – having registered as a lobbyist in 2017 but never spending any money in the state, according to lobbying disclosures.

The General Assembly tasked a summer study committee to hear testimony on legalizing marijuana for medical and recreational use. After three sessions, the committee declined to make any recommendations on the issues in a draft final report but wrote “there was excellent testimony and discussion.”

Study committee chairman Rep. Brad Barrett (R-Richmond) and vice chair Sen. Ed Charbonneau (R-Valparaiso) did not respond to multiple requests for comment.

As the 2023 legislative session starts, lawmakers have filed bills to change the state’s marijuana laws, but the legislature’s Republican leadership says it remains unlikely.

Medical, recreational marijuana bills face uphill battle

Medical and recreational marijuana bills have a history of failure in the Statehouse with nearly all never even getting a committee hearing. During the last five sessions, legislators failed to act on at least 12 marijuana legalization bills and at least 26 medical marijuana bills, according to an Arnolt Center analysis of proposed legislation.

Lawmakers created a study committee for medical and recreational marijuana in 2018 but that process resulted in no meaningful action.

Indiana has passed only nine bills relating to cannabis regarding low-level THC products, hemp and research.

Hammond Mayor Thomas McDermott Jr., a Democrat, made marijuana legalization part of his platform during his failed bid for the U.S. Senate in 2022. McDermott released an ad that showed him and others smoking marijuana, saying that Indiana’s losing out on tax money as Hoosiers drive to Illinois and Michigan where it is legal.

Indiana Democrats have largely driven the push to legalize marijuana, though some Republicans have joined the effort.

Among them is Rep. Jim Lucas (R-Seymour), who has long pursued the decriminalization of medical and recreational marijuana. While the Seymour Republican has led the charge on marijuana within his party, he’s yet to convince leadership – with whom Lucas often has found himself at odds, facing discipline over social media posts seen as racist — to do the same.

“I have been pursuing this issue for years, and the more I educate myself, the more solid I become on my stance,” Lucas said. “Not only do we need to stop criminalizing people for using cannabis, we actually need to encourage the use of cannabis.”

Lucas traveled to Colorado for research, and he spoke with many experts over the years about the benefits of cannabis physically and economically.

“I won’t stop until Indiana decriminalizes it and it gets in the hands of people who can benefit from it medically and can use it recreationally in a responsible manner,” Lucas said.

He not only wants to decriminalize cannabis, at least medically, but will keep pushing to improve cannabis laws if it is legalized.

“I would love to get Indiana or even the nation to start treating cannabis like a tomato plant,” Lucas said. “There’s no reason we can’t go to a farmers market and find a strain that we like.”

Health, safety concerns drive arguments against legalization

Brian Honnan, a representative of American Cancer Society, spoke to the Indiana Interim Study Committee on Public Health, Behavioral Health and Human Services, testifying against smoking marijuana.

“The most common way marijuana is consumed by adults is through smoking. Smoking marijuana products can negatively affect lung function,” Honnan said. “Marijuana smokes contains the same fine particulate matter that is found in tobacco smoke and can cause heart attacks according to a research study done last year. Exposure to marijuana smoke can also have effects on the heart.”

In states with legalized marijuana, the THC products come in multiple forms aside from smokable cannabis.

Because marijuana is a Schedule I FDA drug, Hannon said it is difficult for the Cancer Society to do research on the drug.

The Indiana Prosecuting Attorneys Council is also against the legalization of recreational and medicinal marijuana. Brock Patterson, who represented the group at the committee’s hearing, said they had concerns such as lab testing capabilities for marijuana use and the possibility of increased impaired drivers.

Kevin Brinegar, president and CEO of the Indiana Chamber of Commerce, said the organization is against the legalization of recreational and medicinal marijuana for similar reasons, one being that the FDA has not approved its use medically. Additionally, he said the Indiana Chamber is concerned about the possibility of increased workplace incidents from being under the influence of marijuana and the possibility of dangerous criminal elements inside the industry.

Brinegar cited an NBC investigation that found human trafficking victims are being used to grow cannabis that is then sold in legal markets. Others against legalization have shared similar concerns that even industries in states where it has been legalized have too many ties to illegal activity.

Tax revenue, regulated markets drive pro-marijuana arguments

Proponents of legalization say that legalization helps to regulate and make the industry safer.

“I want a regulated market, I have a teen and a pre-teen and if my child got their hands on something I would want to know what is in it, I would want to know it’s safe, it’s effective and there is a control around it,” said Katie Willey, Stash Ventures’ chief legal and strategy officer.

Proponents of legalization also cite vast economic benefits, such as increased jobs and tax revenue. Since 2018, California has seen over $4 billion in cannabis tax revenue, and Colorado has seen almost $$1.8 billion.

States surrounding Indiana that have legalized like Illinois and Michigan have seen nearly $679.5 and nearly $333.3 million respectively, in tax revenue from adult use cannabis. Ohio has legalized marijuana for medical use, and has legislation pending to allow its sale and use recreationally.

However, the financial benefit might not be as strong a selling point in Indiana, which has a budget surplus of $6 billion.

Both Indiana state and federal law say anything above 0.9% THC concentration is considered marijuana whereas anything below that is considered hemp. The state followed federal precedent and legalized industrial hemp in 2019.

There are separate legal definitions in Indiana for substances like hemp buds, hemp flowers, hashish, hash oil, low THC hemp extract, and smokable hemp.

Proponents of cannabis legalization say that trying to treat subcategories of cannabis in the same way doesn’t account for the different uses.

“Just like a German Shepherd and a Chihuahua are both dogs that have been bred for different needs, hemp and marijuana are both cannabis plants that have been bred for various ends uses like fiber, grain and cannabinoids,” said Justin Swanson, of Bose McKinney & Evans LLP, who spoke on behalf of the Midwest Hemp Council and 3Chi during the study committee hearings.

Swanson told the interim study committee legalized marijuana would be a $2 billion market in Indiana. He added no state has reversed course on legalized marijuana.

Federal action could leave Indiana behind

As the 2023 legislative session began earlier this week, dozens of supporters of legalization rallied at the Statehouse.

In response to reporters’ questions, Gov. Eric Holcomb reiterated that he won’t back any marijuana legalization effort, instead ceding that decision to the federal government, but then added that he might be open to decriminalizing possession of small amounts, saying, “I do not believe that simple possession – at certain limits – should derail someone’s life. That doesn’t mean you ignore the law,’’ the Indiana Capital Chronicle reported.

The Chronicle also reported that Rep. Jake Teshka, a Republican from St. Joseph County who was among a growing number of lawmakers introducing bills to allow medical or recreational use, called Indiana “an island of prohibition. And you better believe that Hoosiers are crossing state lines and taking advantage of that.’’ But House Speaker Todd Huston, when asked about the possibility of a change in the laws this year, said it was “less than likely.’’

Inaction would leave Indiana without the potential in millions in tax revenue and industry development should marijuana first get legalized federally, say proponents. States currently have closed markets, retaining any revenue from sales and industry growth, according to Tew, and that all disappears if the federal government legalizes marijuana use.

“If the feds legalize, then all the infrastructure that’s in place across the United States will be used to just basically import cannabis into Indiana and none of that infrastructure will be built in Indiana,” Tew said. “And it’s a real lost opportunity because we’re the crossroads of America, we are agriculture and manufacturing heavy.”

“Everybody knows it is going to get legalized, so to sit on your hands and wait for the feds is just a missed opportunity for people to be able to make money and create real, good-paying jobs,” Tew said.

Reporters Olivia Oliver and Lily Wray reported this story through the Arnolt Center for Investigative Journalism at Indiana University in partnership with The Indiana Citizen.