[Senate Hearing 113-588]
[From the U.S. Government Publishing Office]





                                                        S. Hrg. 113-588
 
           CONFLICTS BETWEEN STATE AND FEDERAL MARIJUANA LAWS

=======================================================================

                                HEARING

                               before the

                       COMMITTEE ON THE JUDICIARY
                       
                          UNITED STATES SENATE

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

                               __________

                      TUESDAY, SEPTEMBER 10, 2013

                               __________

                          Serial No. J-113-28

                               __________

         Printed for the use of the Committee on the Judiciary
         
  
  
                                     ______

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                       COMMITTEE ON THE JUDICIARY

                  PATRICK J. LEAHY, Vermont, Chairman
DIANNE FEINSTEIN, California         CHUCK GRASSLEY, Iowa, Ranking 
CHUCK SCHUMER, New York                  Member
DICK DURBIN, Illinois                ORRIN G. HATCH, Utah
SHELDON WHITEHOUSE, Rhode Island     JEFF SESSIONS, Alabama
AMY KLOBUCHAR, Minnesota             LINDSEY GRAHAM, South Carolina
AL FRANKEN, Minnesota                JOHN CORNYN, Texas
CHRISTOPHER A. COONS, Delaware       MICHAEL S. LEE, Utah
RICHARD BLUMENTHAL, Connecticut      TED CRUZ, Texas
MAZIE HIRONO, Hawaii                 JEFF FLAKE, Arizona
           Kristine Lucius, Chief Counsel and Staff Director
              Kolan Davis, Republican Chief Staff Director
              
              
                            C O N T E N T S

                              ----------                              

                    STATEMENTS OF COMMITTEE MEMBERS

                                                                   Page


Leahy, Hon. Patrick J., a U.S. Senator from the State of Vermont.     1
    prepared statement...........................................    37
Whitehouse, Hon. Sheldon, a U.S. Senator from the State of Rhode 
  Island.........................................................     3
Grassley, Hon. Chuck, a U.S. Senator from the State of Iowa......     4
    prepared statement...........................................    32

                               WITNESSES

Witness List.....................................................    31
Cole, Hon. James, Deputy Attorney General, U.S. Department of 
  Justice, Washington, DC........................................     6
    prepared statement...........................................    39
Urquhart, Hon. John, Sheriff, King County Sheriff's Office, 
  Seattle, Washington............................................    18
    prepared statement...........................................    44
Finlaw, Jack, Chief Legal Counsel, Office of Governor John W. 
  Hickenlooper, Denver, Colorado.................................    20
    prepared statement...........................................    46
Sabet, Kevin A., Ph.D., Director, University of Florida Drug 
  Policy Institute, Department of Psychiatry, Division of 
  Addiction Medicine; and Director, Project SAM (Smart Approaches 
  to Marijuana), Cambridge, Massachusetts........................    21
    prepared statement...........................................    55

                               QUESTIONS

Questions submitted by Senator Dianne Feinstein for James M. Cole    66
Questions submitted by Senator Charles Grassley for James M. Cole    72
Questions submitted by Senator Patrick Leahy for James M. Cole...    73
Questions submitted by Senator Al Franken for James M. Cole......    75
Questions submitted by Senator Charles Grassley for John Urquhart    76
Questions submitted by Senator Charles Grassley for Jack Finlaw..    77
Questions submitted by Senator Charles Grassley for Kevin Sabet..    78

                                ANSWERS

Responses of James M. Cole to questions submitted by Senators 
  Leahy, Grassley, and Feinstein.................................    79
Responses of John Urquhart to questions submitted by Senator 
  Franken........................................................   106
Responses of John Urquhart to questions submitted by Senator 
  Grassley.......................................................   108
Responses of Jack Finlaw to questions submitted by Senator 
  Grassley.......................................................   110
Responses of Kevin Sabet to questions submitted by Senator 
  Grassley.......................................................   112

                MISCELLANEOUS SUBMISSIONS FOR THE RECORD

Letter to Attorney General Eric Holder from Steven F. Lukan, 
  Director, Iowa Governor's Office of Drug Control Policy........   114
Letter to Attorney General Eric Holder from National Law 
  Enforcement Organizations in Hennepin County, Minnesota; Hughes 
  County, South Dakota; Association of State Criminal 
  Investigative Agencies; International Association of Chiefs of 
  Police; Police Executive Research Forum; and National Narcotic 
  Associations' Coalition........................................   116
Letter to Attorney General Eric Holder from the Former 
  Administrators of the Drug Enforcement Administration (1973-
  2007)..........................................................   119
Letter to Senator Leahy from Dennis J. Gallagher, City Auditor, 
  Denver, Colorado...............................................   121
Americans for Safe Access, ``Three Areas of Inquiry for 
  `Conflicts Between State and Federal Marijuana Laws' ''........   123
Tamar Todd, Senior Staff Attorney, Drug Policy Alliance, Office 
  of Legal Affairs, statement....................................   133
Governor Jay Inslee and Attorney General Bob Ferguson, Washington 
  State, statement...............................................   141
Letter to Senator Leahy from Mark A.R. Kleiman, Professor of 
  Public Policy, UCLA Luskin School of Public Affairs, Los 
  Angeles, California............................................   145
Letter to Senator Leahy from Hon. Dana Rohrabacher, 49th 
  District, California...........................................   151
Letter to Senator Leahy from We Can Do Better Coalition: Sue 
  Rusche, National Families in Action; A. Thomas McLellan, 
  Treatment Research Institute; Kevin Sabet, Project SAM (Smart 
  Approaches to Marijuana).......................................   152
Hon. Ed Perlmutter, 7th District, Colorado, statement............   157
Letter to Treasury Secretary Lew, Chairman Bernanke, Chairman 
  Gruenberg, Comptroller Curry, Director Corday, and Chairman 
  Matz from Hon. Ed Perlmutter, 7th District, Colorado, and Hon. 
  Denny Heck, 10th District, Washington State....................   159
Letter to Senator Leahy from Lori Augustyniak, Prevention Works! 
  VT.............................................................   161


           CONFLICTS BETWEEN STATE AND FEDERAL MARIJUANA LAWS

                      TUESDAY, SEPTEMBER 10, 2013

                                       U.S. Senate,
                                Committee on the Judiciary,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 2:45 p.m., in 
Room SH-216, Hart Senate Office Building, Hon. Patrick J. 
Leahy, Chairman of the Committee, presiding.
    Present: Senators Leahy, Whitehouse, Blumenthal, and 
Grassley.

OPENING STATEMENT OF HON. PATRICK J. LEAHY, A U.S. SENATOR FROM 
                      THE STATE OF VERMONT

    Chairman Leahy. I have mentioned to the witnesses the 
reason for the delay. It was because I was talking to Senator 
Grassley, who is going to be joining us shortly. He has been in 
a very important meeting with the President on the situation in 
Syria. The President met with the Senate Democrats earlier and 
now he is meeting with the Senate Republicans. It is a gravely 
serious matter, as I am sure all of you know, and I mentioned 
this to Deputy Attorney General Cole earlier also.
    Today's hearing also deals with a serious issue, and I 
trust that members of the public here will act accordingly. I 
want to note at the outset that the rules of the Senate 
prohibit outbursts, clapping, or demonstrations of any kind 
either for or against any position I might take or anybody else 
might take. That includes blocking the view of people around 
you.
    I am glad to have this hearing room where we can 
accommodate as many as we possibly can, and we have overflow 
rooms with a television. But please be mindful of the rules 
when we conduct these hearings, and, of course, the Capitol 
Police will be authorized to remove anyone who does not follow 
these rules.
    Now, last November, the people of Colorado and Washington 
voted to legalize the possession and use of small amounts of 
marijuana and to regulate how marijuana is produced and 
distributed in their States. These new laws are just the latest 
examples of the growing tension between federal and State 
marijuana laws, and they underscore the persistent uncertainty 
about how such conflicts are going to be resolved.
    Should the Federal Government arrest and prosecute 
marijuana users in States where they might be in full 
compliance with State law? Or should the Federal Government 
take a completely hands-off approach and let drug laws and 
policy develop on a State-by-State basis? Or is there some 
middle-ground approach that considers both the national 
interests and the fundamental principles of federalism, 
including the rights of voters to decide what is best for their 
own individual States? So the Committee is going to hold the 
first congressional hearing on these issues since the new laws 
passed in Colorado and Washington, and it presents an important 
opportunity to hear from some of the people who are directly 
involved in grappling with these complex questions.
    Of course, much of the focus of today's hearing is going to 
be on what is happening in Colorado and Washington, but the 
questions and issues we have today are going to have 
implications for the rest of the country. Marijuana use in this 
country is nothing new, but the way in which individual States 
deal with marijuana usage continues to evolve. Some States, 
like my own State of Vermont, have decided to allow the use of 
marijuana by patients with debilitating medical conditions. As 
a result, Vermonters who suffer from diseases like multiple 
sclerosis, cancer, and AIDS now are able to use medical 
marijuana to at least treat the symptoms of their conditions. 
In addition, some States, including Vermont, have simply 
decriminalized marijuana, imposing civil fines on marijuana 
users rather than criminal penalties.
    To date, and as shown on this map, we have a total of 21 
States that have legalized marijuana for medical purposes, and 
16 of those States have decriminalized the possession of small 
amounts of marijuana. But every one of these changes in State 
marijuana laws has taken place against the same background: the 
possession of any amount of marijuana is still a criminal 
penalty under federal law.
    Now, the question I have is: What role should the Federal 
Government play in those States where marijuana use is legal? I 
think it is important for us to identify the areas in which 
there is broad agreement and common ground. For example, the 
Federal Government and those States that have legalized 
marijuana in some way all agree on the necessity of preventing 
the distribution of marijuana to minors. Likewise, there is 
agreement about the need to prevent criminal enterprises from 
profiting from marijuana sales, the goal of reducing violent 
crime, and the dangers associated with drugged driving. These 
are important safety concerns, and I appreciate everybody who 
is acting to address them, in federal, State, and local law 
enforcement.
    Now, I hope, though that there might be agreement on the 
fact that we cannot be satisfied with the status quo. We know 
the black market for illegal marijuana in this country 
endangers public safety. The black market continues to 
contribute to violence along the southwest border. It continues 
to thrive despite the billions of dollars that have already 
been spent on enforcement efforts at the federal, State, and 
local levels. It is also clear that the absolute 
criminalization of personal marijuana use has contributed to 
our Nation's soaring prison population and has 
disproportionately affected people of color. And in this 
context, it is no surprise that States are considering new, 
calibrated solutions that reach beyond the traditional laws. 
Anybody, including two of us right here, who has been a 
prosecutor knows that you cannot begin to prosecute all the 
laws that are on the books. You do not have the resources. The 
question is: What resources should we use and where?
    I asked the administration last December for its responses 
to the measures, especially in Colorado and Washington. It took 
some time, but I am encouraged by the policy guidance that the 
Deputy Attorney General recently provided to federal 
prosecutors. Federal agents and prosecutors have scarce 
investigative resources. I really do not think they should be 
devoting them to pursuing low-level users of marijuana who are 
complying with the laws of their States. As the President said 
last year, there are bigger fish to fry. And I am glad that the 
Justice Department plans to commit its limited resources to 
addressing more significant threats.
    I appreciate that Deputy Attorney General Cole, who is no 
stranger to this Committee, is here to answer questions. But I 
also look forward to hearing from the witnesses from Colorado 
and Washington. They see these issues not in the abstract but 
day by day in their State. I want them to explain the decisions 
in their States and the implementation of those decisions.
    I hope today's hearing will also shine a light on how a 
series of federal laws poses significant obstacles to effective 
State implementation and regulation of marijuana, including 
existing federal laws and regulations in areas such as banking 
and taxation. We have to have a smarter approach to marijuana 
policy, and that can only be achieved through close cooperation 
and mutual respect between the Federal Government and the 
States.
    [The prepared statement of Senator Leahy appears as a 
submission for the record.]
    Senator Whitehouse, did you wish to----

 OPENING STATEMENT OF HON. SHELDON WHITEHOUSE, A U.S. SENATOR 
                 FROM THE STATE OF RHODE ISLAND

    Senator Whitehouse. Let me thank the Chairman for holding 
this important hearing. We have States, as the Chairman's map 
of the country's quilt of different approaches demonstrated, 
that have taken very different ways of dealing with marijuana 
use, particularly for minor, very small amount individual 
users, and for those for whom it is adjudged to be medically 
necessary. Rhode Island permits medical marijuana and recently 
decriminalized the possession of small amounts of marijuana. 
Our Governor, Governor Chafee, has asked the Drug Enforcement 
Administration to declassify marijuana as a Schedule II 
substance, which would allow it to be prescribed.
    It strikes me that the areas in which the States are 
loosening up restrictions on the use of marijuana are virtually 
entirely also areas in which the need for federal prosecution, 
and the rationale for the use of scarce law enforcement and 
prosecutive resources is extremely low. So there does not seem 
to be an underlying need for conflict between federal 
prosecution policies and State marijuana policies, and yet I 
believe that in the past, largely due to uncertain and often 
inconsistent policies from the Department of Justice, there has 
been created an artificial conflict. And I think the new memo 
helps clarify that, and I look forward to this hearing helping 
to clarify it further. And I thank the Deputy Attorney General, 
whom I respect very much, for coming here to discuss this issue 
with us, and I thank the Chairman for holding this important 
hearing.
    Chairman Leahy. Senator Grassley.

 OPENING STATEMENT OF HON. CHUCK GRASSLEY, A U.S. SENATOR FROM 
                       THE STATE OF IOWA

    Senator Grassley. Mr. Chairman, I would like to give my 
opening statement.
    Chairman Leahy. Certainly. Go ahead.
    Senator Grassley. Thank you. Of course, I thank you very 
much for holding today's hearing about the conflict between 
federal and State laws. Since Congress passed the Controlled 
Substance Act, the cultivation, trafficking, sale, and use of 
marijuana have been illegal under federal law. Marijuana's 
continued presence on the statute's list of illegal substances 
is not based on whim. It is based on what science tells us 
about this dangerous and addictive drug. There is a process 
that exists to move drugs on and off that list, but the 
scientific standard to do that has not yet been met for 
marijuana.
    Marijuana is not only illegal under laws passed by 
Congress, it is illegal under international law as well. The 
United States and 180 nations have signed the Single Convention 
on Narcotic Drugs. This treaty requires the United States to 
limit the distribution and use of certain drugs, including 
marijuana, for exclusively scientific and medical use. It is 
something this country gave its word to do, and it is a 
commitment that our country and many others have benefited from 
through improved public health.
    Yet in 2012, Colorado and Washington decided to be the 
first jurisdiction in the world to legalize the cultivation, 
trafficking, sale, and recreational use of marijuana. These 
laws flatly contradict our federal law. Moreover, these laws 
have nothing to do with the controversy about whether marijuana 
has an appropriate medical use. Some experts fear they will 
create a big marijuana industry, including a Starbucks of 
marijuana that will damage public health, and it seems unlikely 
that we will be able to confine that industry's effect to 
adults and those within the States of Colorado and Washington. 
And the response of the Department of Justice is not to sue to 
strike down the laws or to prosecute illegal drug traffickers, 
but just to let these States do it.
    These policies do not seem to be compatible with the 
responsibility our Justice Department has to faithfully 
discharge their duties, and they may be a violation of our 
treaty obligations.
    Prosecutorial discretion is one thing, but giving the green 
light to an entire industry predicated on breaking federal law 
is quite another. These policies are another example of this 
administration ignoring laws that it views as inconvenient or 
that it does not like. Whether it is immigration laws or Obama 
deadlines, the list is long, and it hardly needs repeating.
    But what is really striking in this case is that the 
Department of Justice is so quick to challenge State laws when 
it does not like or want to enforce them. States that change 
their voting laws to require an ID, well, we will see you in 
court. States that try to secure their borders when the Federal 
Government will not, expect a lawsuit. But if some folks want 
to start an industry dedicated to breaking federal law, well, 
then the Department's position is to wait and see how it works 
out.
    But we already have a pretty good idea how it works out, 
and the answer is: Badly.
    Take Colorado as an example. Since it has legalized and 
attempted to regulate medical marijuana, what have we seen? 
From 2006 to 2011, a 114-percent increase in driving fatalities 
involving drivers testing positive for marijuana. Comparing 
2007 through 2009 with 2010 through 2012, a 37-percent increase 
in drug-related suspensions and expulsions from Colorado 
schools, a sharp increase in marijuana exposure to young 
children, many resulting in trips to poison control centers or 
hospitals; and in the words of Colorado's Attorney General, the 
State is becoming ``a significant exporter of marijuana to the 
rest of the country.''
    The statistics on this point are shocking, but not 
surprising, given simple economics. From 2005 to 2012, there 
was a 407-percent increase in Colorado marijuana interdiction 
and seizures that were destined for other States. In 2012 
alone, there were interdictions in Colorado bound for 37 
different States. One of those States was my home State of 
Iowa. In 2010, Colorado was the source State for 10 percent of 
all marijuana interdictions in Iowa. That number grew to 25 
percent in 2011 and to 36 percent in 2012.
    Now, this was all before full legalization in Colorado. 
What do you think this number will be next year? Is the Federal 
Government prepared to pay for law enforcement costs it is 
imposing on States like Iowa because it refuses to enforce 
federal law? In 2012, the proportion of Iowa juveniles entering 
substance treatment primarily due to marijuana reached its 
highest point in 20 years. How many more of Iowa's daughters 
and sons will go into treatment next year because the 
Department will not enforce federal law? There is no amount of 
money that can make Iowa whole for that.
    I have a letter from the Director of the Iowa Office of 
Drug Control Policy to the Attorney General that lays out some 
of these statistics. The Director requested that the Department 
consider this decision, and I ask that that be included in the 
record.
    Chairman Leahy. Without objection.
    [The letter follows appears as a submission for the 
record.]
    Senator Grassley. Of course, the Department would have 
known many of these things had it consulted with the folks on 
the ground before making those decisions. These are people who 
see the effects of marijuana addiction and abuse every day.
    I also have here a letter to the Attorney General from many 
of the major State and local law enforcement organizations in 
the United States and likewise ask to put that in the record.
    Chairman Leahy. Without objection.
    [The letter follows appears as a submission for the 
record.]
    Senator Grassley. I understand representatives of many of 
these organizations had asked to be consulted in advance of the 
Department's decision, and they were told that they would be. 
However, they wrote, ``It is unacceptable that the Department 
of Justice did not consult our organizations whose members will 
be directly impacted for meaningful input ahead of this 
important decision. Our organizations were given notice just 30 
minutes before the official announcement was made public and 
were not given the adequate forum ahead of time to express our 
concerns with the Department's conclusion on this matter. 
Simply checking the box by alerting law enforcement officials 
right before a decision is announced is not enough and 
certainly does not show an understanding of the value of the 
Federal, State, local, and tribal law enforcement partnerships 
bring to the Department of Justice and to public safety.''
    I will put the rest of my statement in the record.
    [The prepared statement of Senator Grassley appears as a 
submission for the record.]
    Chairman Leahy. Thank you very much.
    Our first witness is James Cole, as I said, the Deputy 
Attorney General of the Department of Justice. In that 
capacity, he helped the Department update marijuana enforcement 
policies following the recent State-level developments that I 
discussed earlier. He first joined the Department of Justice in 
1979 and served for 13 years in the Criminal Division, later 
becoming the Deputy Chief of the Division's Public Integrity 
Section before entering private practice.
    Mr. Cole, it is always good to have you here. Please go 
ahead, sir.

  STATEMENT OF HON. JAMES COLE, DEPUTY ATTORNEY GENERAL, U.S. 
            DEPARTMENT OF JUSTICE, WASHINGTON, D.C.

    Mr. Cole. Thank you, Chairman Leahy, Ranking Member 
Grassley, Senator Whitehouse. I am pleased to speak with you 
about the guidance that the Department recently issued to all 
United States Attorneys regarding marijuana enforcement 
efforts. That guidance instructs our prosecutors to continue to 
enforce federal priorities, such as preventing sales of 
marijuana by criminal enterprises, preventing violence and the 
use of firearms in the cultivation and distribution of 
marijuana, preventing distribution to minors, and preventing 
the cultivation of marijuana on public lands--priorities that 
we historically have focused on for many years--and it also 
notes that we will continue to rely on State and local 
authorities to effectively enforce their own drug laws as we 
work together to protect our communities.
    As you know, the relevant federal statute, the Controlled 
Substances Act of 1970, among other prohibitions, makes it a 
federal crime to possess, grow, or distribute marijuana, and to 
open, rent, or maintain a place of business for any of these 
purposes.
    For many years, all 50 States have enacted uniform drug 
control laws or similar provisions that mirrored the CSA with 
respect to their treatment of marijuana and made the 
possession, cultivation, and distribution of marijuana a State 
criminal offense. With such overlapping statutory authorities, 
the Federal Government and the States traditionally worked as 
partners in the field of drug enforcement. Federal law 
enforcement historically has targeted sophisticated drug 
traffickers and organizations, while State and local 
authorities generally have focused their enforcement efforts, 
under their State laws, on more localized and lower-level drug 
activity.
    Starting with California in 1996, several States authorized 
the cultivation, distribution, possession, and use of marijuana 
for medical purposes under State law. Today, 21 States and the 
District of Columbia legalize marijuana for medical purposes 
under State law, including six States that enacted medical 
marijuana legislation this year.
    Throughout this time period, the Department of Justice has 
continued to work with its State and local partners, but 
focused its own efforts and resources on priorities that are 
particularly important to the Federal Government. The 
priorities that have guided our efforts are as follows:
    Preventing the distribution of marijuana to minors;
    Preventing revenue from the sale of marijuana from going to 
criminal enterprises, gangs, and cartels;
    Preventing the diversion of marijuana from States where it 
is legal under State law in some form to other States;
    Preventing State-authorized marijuana activity from being 
used as a cover or pretext for the trafficking of other illegal 
drugs or other illegal activity;
    Preventing violence and the use of firearms in the 
cultivation and distribution of marijuana;
    Preventing drugged driving and the exacerbation of other 
adverse public health consequences associated with marijuana 
use;
    Preventing the growing of marijuana on public lands and the 
attendant public safety and environmental dangers posed by 
marijuana production on public lands; and
    Preventing marijuana possession or use on federal property.
    Examples of our efforts have included cases against 
individuals and organizations who were using the State laws as 
a pretext to engage in large-scale trafficking of marijuana to 
other States; enforcement against those who were operating 
marijuana businesses near schools, parks, and playgrounds; and 
enforcement against those who were wreaking environmental 
damage by growing marijuana on our public lands. On the other 
hand, the Department has not historically devoted our finite 
resources to prosecuting individuals whose conduct is limited 
to the possession of marijuana for personal use on private 
property.
    In November 2012, voters in Colorado and Washington State 
passed ballot initiatives that legalized, under State law, the 
possession of small amounts of marijuana and made Colorado and 
Washington the first States to provide for the regulation of 
marijuana production, processing, and sale for recreational 
purposes. The Department of Justice has reviewed these ballot 
initiatives in the context of our enforcement priorities.
    On August 29, 2013, the Department notified the Governors 
of Colorado and Washington that we were not at this time 
seeking to preempt their States' ballot initiatives. We advised 
the Governors that we expected their States to implement strong 
and effective regulatory and enforcement systems to fully 
protect against the public health and safety harms that are the 
focus of our marijuana enforcement priorities, and that the 
Department would continue to investigate and prosecute cases in 
Washington and in Colorado in which the underlying conduct 
implicated our federal interests. The Department reserved its 
right to challenge the State laws at a later time in the event 
any of the stated harms do materialize--either in spite of a 
strict regulatory scheme, or because of the lack of one.
    That same day, the Department issued a guidance memorandum 
to all United States Attorneys directing our prosecutors to 
continue to fully investigate and prosecute marijuana cases 
that implicate any one of our eight federal enforcement 
priorities. This memorandum applies to all of our prosecutors 
in all 50 States and guides the exercise of prosecutorial 
discretion against individuals and organizations who violate 
any of our stated federal interests, no matter where they live 
or what the laws in their States may permit. Outside of these 
enforcement priorities, however, the Department will continue 
to rely on State and local authorities to address marijuana 
activity through the enforcement of their own drug laws. This 
updated guidance is consistent with our efforts to maximize our 
investigative and prosecutorial resources in this time of 
budget challenges, and with the more general message the 
Attorney General delivered last month to all federal 
prosecutors, emphasizing the importance of quality priorities 
for all cases we bring, with an eye toward promoting public 
safety, deterrence, and fairness.
    Our updated guidance also makes one overarching point 
clear: the Department of Justice expects that States and local 
governments that have enacted laws authorizing marijuana-
related conduct will implement effective regulatory and 
enforcement systems to protect federal priorities and the 
health and safety of every citizen. As the guidance explains, a 
jurisdiction's regulatory scheme must be tough in practice, not 
just on paper.
    [The prepared statement of Mr. Cole appears as a submission 
for the record.]
    Chairman Leahy. Thank you. You know, I worry about the 
extent to which we have some who do not take the position or 
are unwilling to follow it and may create further problems. For 
example, the banking industry is not willing to provide 
services to State-authorized marijuana dispensaries. They fear 
they may be violating federal money laundering laws. So then 
the State authorized marijuana dispensaries and they started 
operating as a cash-only business, with no access to bank 
accounts or credit card transactions. That is a prescription 
for problems, tax evasion and so on. And we are hearing that 
the DEA agents, in what seems to me like a significant step 
away from reality, are instructing armored car companies to 
cease providing services to marijuana dispensaries, almost as 
if they are saying, ``Get out of there so we can have some 
robberies.''
    Now, I am sure it is not stated that way, but I worry that 
sometimes a bureaucracy trumps reality, as it has in this case 
with the DEA.
    So what is the Department going to do to address these 
concerns? What sort of guidance are you giving to States about 
these banking and tax issues?
    Mr. Cole. Chairman Leahy, as far as the banking issue is 
concerned, we agree it is an issue that we need to deal with. 
When the Attorney General talked to the Governors of Washington 
and Colorado, they raised the same issue, and others have 
raised the same issue.
    Obviously, there is a public safety concern when businesses 
have a lot of cash sitting around. There is a tendency that 
there are guns associated with that, so it is important to deal 
with that kind of issue. And we are at the present time talking 
with FinCEN, and they are talking with and bringing in bank 
regulators to discuss ways that this could be dealt with in 
accordance with the laws that we have on the books today.
    Chairman Leahy. You may want to talk with DEA, too.
    Mr. Cole. Well, as far as DEA is concerned, Mr. Chairman, I 
certainly had heard about that. From what I understand, DEA was 
merely asking questions of the armored car companies at the 
time as to what their practices are. I think those questions 
occurred before the guidance memo was put out, and certainly at 
the present time I do not believe there is any effort to 
instruct the armored car companies not to do anything at this 
point.
    Chairman Leahy. The implication is out there, and I would 
hope that it will get cleared up because I do not want to see a 
shoot-out somewhere and have innocent people or law enforcement 
endangered by that. So I think there should be specific 
guidance to the financial services industry and the Treasury 
Department.
    Now, you have noted that the Department generally does not 
prosecute individuals for using small amounts of marijuana on 
private property, which I think is sort of the general attitude 
of most State prosecutors. They usually have real problems to 
deal with. You said the Department is targeting sophisticated 
and large-scale drug traffickers. They rely upon State and 
local law enforcement to go after lower-level drug activity, 
although they are usually overwhelmed with things that really 
affect people.
    In the wake of the recent guidance, we have heard some 
concerns that the Federal Government is abdicating its 
responsibility for enforcing drug laws in Colorado or 
Washington State, and that the Department's decision will lead 
to free-for-all drug activity in those States.
    I assume you do not agree with that characterization that 
the Justice Department is abdicating its responsibility for 
enforcing federal drug laws in those States.
    Mr. Cole. I do not agree with it at all, Mr. Chairman. I 
think it is quite the contrary. What I think is very clear in 
our memo is that we are going to aggressively enforce the 
Controlled Substance Act when it implicates any of the eight 
priorities that are listed there, and I think that is a pretty 
fulsome list of priorities of important public safety issues 
that are present and associated with marijuana.
    We expect to continue to enforce the CSA in every State, 
whenever a priority is implicated, whether the State has a 
State law legalizing marijuana or not. We are not giving 
immunity. We are not giving a free pass. We are not abdicating 
our responsibilities. We are dedicating ourselves to enforcing 
the Controlled Substances Act in regard to marijuana when it 
implicates those federal priorities.
    Chairman Leahy. Are you going to monitor the implementation 
of the regulatory system in these States?
    Mr. Cole. We will certainly be looking at how they go about 
implementing it, and we hope that they will be doing it in a 
full and robust way. But largely how we operate is on a case-
by-case basis, and when we see somebody who is marketing 
marijuana in a way that is going to be attractive to minors, we 
are going to go after them. If we see somebody who is growing 
and cultivating marijuana so they can export it out of State, 
we are going to go after them. If they are involved in drug 
cartels and illegal enterprises, we are going to go after them.
    Chairman Leahy. Now, you stated in your testimony that the 
Department reserves its right to file a lawsuit challenging the 
State laws in Colorado and Washington at a later time. The law 
is clear, of course, that the Federal Government cannot force a 
State to criminalize a particular type of conduct or activity. 
So such a lawsuit would have to challenge the State laws 
focusing on the regulatory framework set up by them but not on 
the question of telling them what they have to criminalize or 
not criminalize. Is that correct?
    Mr. Cole. That is correct, Chairman Leahy. This was a 
difficult issue that we had to contend with in deciding whether 
or not to seek any preemption action here, because it would be 
a very challenging lawsuit to bring to preempt the State's 
decriminalization law. We might have an easier time with their 
regulatory scheme in preemption, but then what you would have 
is legalized marijuana and no enforcement mechanism within the 
State to try and regulate it. And that is probably not a good 
situation to have.
    Chairman Leahy. Kind of an incentive for a black market, 
isn't it?
    Mr. Cole. Very much so, sir, and money going into organized 
criminal enterprises instead of going into State tax coffers 
and having the State regulate from a seed-to-sale basis.
    Chairman Leahy. Basically everything the State voted for 
you would be trying to overturn.
    Mr. Cole. We would be trying to overturn that, and yet 
there would still be decriminalization of marijuana, so it 
would still exist in the State.
    Chairman Leahy. Thank you.
    Senator Grassley.
    Senator Grassley. Mr. Cole, I have three questions, but 
before I do that, I want to take 30 seconds out of my own time 
to bring an issue up that I think you can help us with.
    The DEA is refusing to comply with its legal obligations to 
provide GAO access to DEA records. Senator Whitehouse and I 
have a GAO request for a report on drug shortages that is being 
delayed because of DEA's refusal. I tried to help resolve the 
issue, but the Justice Department told DEA not to even meet 
with me and GAO to discuss it. So I think that is unacceptable. 
I understand that you admitted to the Comptroller General that 
DEA has a legal obligation to comply. However, the Justice 
Department and DEA are still withholding records from the GAO. 
There is no point in wasting time and the taxpayers on 
litigation with GAO, but that is where this is headed if DEA 
does not comply.
    So as Deputy Attorney General, I hope you can help us, to 
work with us in Congress to solve this dispute. DEA needs to 
provide GAO the information it needs to do its work. I do not 
expect you to respond to that now, but I want you to know how I 
feel about it, doing my job of oversight, and there is a 
distinguished Member of the majority that is interested in it 
as much as I am.
    Mr. Cole. Thank you, Senator. I have actually been in 
contact with the Deputy Administrator at GAO to discuss this 
once already. We are planning on having another conversation in 
the next week, I hope, and I am on top of this, Senator.
    Senator Grassley. God bless you.
    The Cole memorandum suggests that the Department will not 
seek to enforce the Controlled Substances Act except for 
certain federal priorities so long as the States that legalize 
marijuana implement effective regulatory schemes. Those 
priorities include the diversion of marijuana from Colorado to 
other States, increased use among minors, and increased 
fatalities from drugged driving. Yet Colorado has seen a sharp 
uptick in each of these three priorities over the past few 
years. Moreover, a recent audit concluded that the Colorado 
Department of Public Health ``does not sufficiently oversee 
physicians who make medical marijuana recommendations.''
    Another recent audit found that the city of Denver did 
``not have a basic control framework in place'' to regulate its 
medical marijuana program. Denver did not even know how many 
marijuana businesses were operating in the border.
    So my question: Why has the Department decided to trust 
Colorado to effectively regulate recreational marijuana when it 
is already struggling to regulate medical marijuana and federal 
priorities are already being negatively impacted? Before you 
answer, would the Department establish metrics concerning these 
priorities that will trigger when it will take action to either 
challenge these laws or more vigorously enforce federal law?
    I want to give you an example. From 2005 to 2012, there was 
a 407-percent increase in Colorado marijuana interdiction 
seizures that were destined for other States. How high would 
that number have to go to trigger a change in policy? I hope 
this is something that you have thought about.
    Mr. Cole. Senator Grassley, we have thought a great deal 
about these issues. I am certainly aware of the audit that was 
done in Colorado about the enforcement of their regulatory 
scheme under medical marijuana, and it was disappointing.
    I think along the lines of what I talked to Chairman Leahy 
about, there are no perfect solutions here. And what we were 
faced with was a situation where we could not, we thought, be 
very successful in trying to preempt the decriminalization. So 
if we just went after their regulatory scheme, instead of just 
having a bad one, they would have no regulatory scheme.
    Our hope is that with this memo and with the engagement 
with the State, telling them, as we say, trust but verify, that 
they will have an incentive to actually put in a robust scheme 
that will, in fact, address a lot of these issues that you have 
raised and everyone else has raised and that are valid issues 
in this area. And we are hoping that that kind of effort by the 
State in enforcing its own State laws will have a better effect 
than having no effort whatsoever.
    So I understand the skepticism that you come to it with. We 
are looking at it in terms of a trust-but-verify method. We 
will be following what is going on. We have reserved quite 
explicitly the right to go in and preempt at a later date if we 
feel that that is in the public interest. And I think we are at 
a point now where we are trying to find the best of the 
imperfect solutions that are before us.
    Senator Grassley. Question number two: You heard in my 
opening statement how the Department did not consult with major 
State and local law enforcement groups or with former DEA 
Administrators when reaching policy decisions. Did the 
Department consult with anybody at DEA, HHS, or the State 
Department about these policies? And if not, why not? And if 
so, what were their views?
    Mr. Cole. Well, we did consult with HHS; we consulted with 
DEA, ONDCP. We even heard from many of those groups who wrote 
that letter. The Attorney General and I this morning met with 
those groups in the Attorney General's conference room for 
about an hour and a half. We had received a lot of input from 
them concerning this matter prior to the decision that we made. 
We stated to them quite clearly today that we should have 
reached out to them one more time before we made the decision, 
and we apologized to them for not making that extra effort. We 
believed that we understood their position, but we have been 
such good partners with them that we owed them one more 
conversation and one more opportunity for them to weigh in, and 
we asked their forgiveness and going forward assured them that 
we would be giving them that kind of opportunity.
    So we did seek out other views in coming to this. We tried 
to be careful. We tried to be responsible, and we tried to look 
at all of the avenues of it. And, in fact, much of the input 
that we got from them and much of what you have been talking 
about as the concerns that are around this helped us to be able 
to crystallize and articulate in our eight different areas what 
it is uniformly throughout the country what we think are the 
problems that trigger federal enforcement in this area. So we 
thanked them for that.
    Senator Grassley. My last question. In 2010, Colorado was a 
source State for 10 percent of all marijuana interdiction in 
Iowa. That number grew to 25 in 2011, 36 percent in 2012. This 
is all before legalization of recreational use in Colorado was 
passed. In the words of Colorado Attorney General, the State is 
becoming ``a significant exporter of marijuana to the rest of 
the country.'' The Department's decision not to enforce federal 
law is obviously imposing costs on States outside of Colorado 
and Washington. These include public health costs and law 
enforcement costs.
    I would normally ask this question. I am going to make a 
statement. If I am wrong--I doubt if the Federal Government has 
plans to reimburse the States for these costs. If I am wrong on 
that, tell me.
    My question: What do you plan to do to protect States like 
Iowa from marijuana diverted from States like Colorado?
    Mr. Cole. I think there are two ways that we are hoping to 
approach this. One is that if the States really do put in the 
kind of robust system that we are asking them to, where there 
is control from seed to sale, that it will help really tamp 
down that kind of export out of Colorado into other States. 
And, second, and at least as importantly, one of the main 
priorities we have is the export of marijuana from States that 
make it legal to any other State, and that will be a federal 
enforcement priority. If it is being exported from Colorado to 
Iowa and we find out about it, we will prosecute it.
    Senator Grassley. Mr. Chairman, just a short follow-up. In 
a previous question, the second question I had, you said you 
consulted with State, HHS, and DEA. Did they agree with the new 
policy that you have announced?
    Mr. Cole. You know, Senator, we had a thorough discussion 
with them. I do not think it is always appropriate to go into 
what the internal deliberations are that take place, but we got 
everybody's views, and we had a thorough discussion and aired 
it out. And this was a well-thought-through process.
    Senator Grassley. Thank you.
    Chairman Leahy. Senator Whitehouse.
    Senator Whitehouse. Thank you, Chairman.
    Mr. Cole, let me just kind of recap what brought us to this 
point because I do not think we were in a very good place to 
begin with. I begin with the Ogden memorandum from 2009 which 
indicated that it would not be a federal enforcement priority 
to prosecute, and I quote, ``individuals whose actions are in 
clear and unambiguous compliance with existing State laws.'' 
And then it gave as an example individuals with cancer or other 
serious illnesses, as another example, ``or those caregivers in 
clear and unambiguous compliance with existing State law.'' It 
then distinguished commercial enterprises that unlawfully 
market and sell marijuana for profit, and a close reading of 
the paragraph indicates that the term ``unlawfully'' refers to 
State law, because the following sentence talks about 
operations inconsistent with the terms, conditions, or purposes 
of those laws, meaning State laws.
    So we come out of the Ogden memorandum with protection from 
federal prosecution for patients, caregivers, and lawful 
commercial enterprises that are ``in clear and unambiguous 
compliance with State laws.'' Among other things, that would 
presumably include dispensaries.
    So the next thing that comes out is the U.S. Attorney's 
letter, which I assume is a Department of Justice product 
because all of the U.S. Attorney letters that came out were 
identically phrased, so I do not think this was a unique one to 
Rhode Island. Now those protected from federal prosecution are 
limited to seriously ill individuals who use marijuana as part 
of a medically recommended treatment regimen in compliance with 
State law. There is no longer any mention of caregivers. And 
further in the paragraph it says that the Department of Justice 
maintains the authority to enforce the CSA vigorously against 
individuals and organizations that participate in unlawful 
manufacturing and distribution activity, only for purposes of 
this paragraph, the term ``unlawful'' has been reversed to now 
mean federal law and eliminate any shelter of State law.
    So there was a dramatic difference, I believe, between the 
Ogden memo and the U.S. Attorney's letter, and it created 
immense confusion, which you then sought to clarify somewhat in 
your June 29, 2011, memo, which said that it will protect 
individuals with cancer or other serious illnesses, and now 
caregivers were back. They were out in the U.S. Attorney's 
letter. They came back in your letter. Caregivers are back in. 
And then you said, but it would not apply to commercial 
operations, cultivating, selling or distributing marijuana. You 
just dropped out the word ``unlawful'' rather than have to deal 
with whether that word applied to federal law or State law. And 
then you added that those who engage in transactions involving 
the proceeds of such activity might be prosecuted, so somebody 
that was paid with money that was earned by one of these folks.
    The U.S. Attorney's letter had also singled out landlords 
and property owners and financiers for prosecution. So as you 
can imagine, this was a mess.
    So I appreciate very much that the August 29th letter 
straightened out that mess considerably. I do not dispute the 
sense of the eight different federal priorities, but I just 
want to--actually there is considerable but imperfect overlap 
between your eight priorities and the priorities from the 
original Ogden memo, lo those many years and memos ago.
    But let me just be clear. As long as they are not the 
proper subjects of federal prosecution under the eight 2013 
federal interests, a dispensary can do business as long as it 
is in clear and unambiguous compliance with State law. Correct?
    Mr. Cole. I think the proper way to phrase it, Senator 
Whitehouse, is, as long as they are not violating any of the 
eight federal priorities in the course of what they are doing, 
that the Federal Government is not going to prosecute them. And 
the State law is up to State enforcement.
    Senator Whitehouse. Understood.
    Mr. Cole. But there also is, just in all fairness, there is 
a catch-all at the end, and it is not meant to swallow the 
entire memo, but you cannot anticipate everything that is going 
to come in the future. So there is an ability, if it is an 
important enough matter that we had not anticipated, to 
prosecute another kind of case even if it does not fall within 
the eight priorities.
    Senator Whitehouse. Understood. And those who receive 
proceeds from a lawful and proper State law enterprise will 
also not be prosecuted unless they violate one of the eight 
federal interests?
    Mr. Cole. This is something that we are trying to work 
through with the banking regulators, because the memo really 
talks about the Controlled Substances Act. Now, the prosecution 
otherwise on the banking end would be with the money-laundering 
statutes, and those I think are separate matters, but as I have 
said in answer to Chairman Leahy's questions, ones that we need 
to deal with. There is a lot of public safety and public 
interest aspects of that that I think we need to deal with as 
we go down this road, and we are working on that.
    Senator Whitehouse. But you are not intending to put people 
who are simply getting their bills paid by a proper, lawful 
State law enterprise from being the subject--it is not your 
intention that they be the subject of prosecution, in the same 
way that if you knew it was a criminal cartel and, no matter 
what your business is, the proceeds of that cartel carry some 
taint with them, and you can go after individuals--just because 
they receive money, you can, if nothing else, reclaim the funds 
as the proceeds of criminal activity. You are not intending to 
use that unless those eight federal interests are implicated.
    Mr. Cole. I think that is part of what we are trying to 
work through right now in trying to deal with the money-
laundering aspect of it. But certainly this memo is meant to 
guide our enforcement efforts concerning marijuana in regard to 
the Controlled Substances Act, and it will probably spill over 
in other ways as we are trying to work through these issues.
    Senator Whitehouse. And, similarly, property owners, 
landlords, and financiers should not fear federal prosecution 
unless they implicate those eight federal interests.
    Mr. Cole. Certainly a lot of that is covered by the 
Controlled Substances Act, so that will be directly within the 
ambit of the memo. That is correct.
    Senator Whitehouse. Okay. Well, I think that helps clarify 
things.
    Senator Grassley raised a number of concerns relating--and 
I thought from hearing them that all of them fell into the 
category of either involving children or involving effects in 
other States or involving a relationship with trafficking 
organizations. And just to be clear, it is my understanding 
that in all three of those situations, those are federal 
interests that would be implicated, and the Federal Government 
would be willing and able to prosecute in those areas.
    Mr. Cole. That is correct.
    Senator Whitehouse. Thank you. My time has expired.
    Chairman Leahy. Senator Blumenthal.
    Senator Blumenthal. Thank you, Mr. Chairman. Thank you for 
having this hearing on a subject vitally important my home 
State of Connecticut. As you know, our law, a new law, 
currently allows the production and sale and use of marijuana 
for medicinal purposes in a regulatory regime that I think is 
fairly straightforward and complete, and certainly indicates 
the will of our legislature in our State that Connecticut wants 
to move in the direction of providing legal access to this kind 
of substance. Essentially it decriminalizes statutes so that 
anyone found in possession with less than half an ounce of 
marijuana will be subject to a citation rather than criminal 
action, and it, I think, mirrors other State laws that contain 
similar kinds of provisions.
    I do not want to speak for the Department of Justice, but 
my guess is there are very few cases authorized by the 
Department of Justice that involve simple possession of small 
amounts of marijuana currently. That has been the ongoing 
practice for some time, has it not?
    Mr. Cole. I think that is correct, and from what we heard 
from the State and local law enforcement organizations this 
morning, they say there are very few of those under State law 
as well.
    Senator Blumenthal. Right. So that current practice will 
not be altered by anything in the memorandum, as I read it.
    Mr. Cole. That is correct.
    Senator Blumenthal. And in terms of some of the other 
priorities, my assumption is that the enforcement efforts there 
on individual prosecution cases would depend to some extent on 
the amounts of marijuana involved, would they not?
    Mr. Cole. That is certainly a factor that is taken into 
account. It is not the sole factor.
    Senator Blumenthal. Would the resulting--and I apologize if 
this question has been asked--action by the Department of 
Justice, if there were not enforcement in some of these areas, 
involve a challenge to the statutory scheme? And how would that 
be brought? Or would it involve individual prosecution cases? 
And how would you make those decisions?
    Mr. Cole. Well, we did briefly talk before, in response to 
Chairman Leahy's question, about what the legal mechanisms 
would be to challenge the State laws. And, first of all, you 
start off with the Controlled Substances Act has in its body 
itself a disclaimer of preempting State laws in the area. 
Because that is explicit in it, you would only have a challenge 
if there is a conflict that is unreconcilable.
    When you have a law that decriminalizes marijuana, it is a 
very big challenge to challenge that law on a preemption ground 
because it can co-exist with a federal law that criminalizes 
it. We can go ahead and enforce our federal law regardless of 
what the State law says.
    We might be in a position and have a better case to try and 
challenge the regulatory scheme, but that puts you in a 
difficult position--there are no perfect solutions here--of 
having the legalization or decriminalization of marijuana and 
not even a legal structure for the State to try and regulate 
it. And that is not a very good solution either. None of them 
are very good in this field, frankly, but that seems to be one 
that takes you in the wrong direction.
    Senator Blumenthal. So the Department of Justice, as I 
understand your answer, would be very cautious and deliberate 
about any challenge to a regulatory scheme because the results 
might do more harm than good.
    Mr. Cole. We are going to have to look at all the facts and 
circumstances that come up. We have certainly put the Governors 
of Colorado and Washington State on notice that we expect them 
to have robust systems. We hope that all the other States that 
have medical marijuana or any other sort of legalized system 
will view this memo as it should be taken, as telling them they 
ought to have a robust system to regulate the marijuana usage 
under their own State laws so that they deal with these eight 
priorities which we think are important. And then we will make 
our decisions as we see what kind of public interest issues are 
raised in the course of this and what the need is for us to 
take action.
    Senator Blumenthal. I understand that the memo deals only 
with Controlled Substances Act, but there are also provisions 
in the Tax Code that forbid deduction of expenses by some of 
these enterprises, non-criminal enterprises, dispensaries and 
others engaged in medicinal marijuana businesses.
    Has the Department of Justice taken a position on changing 
the Tax Code to make those legitimate businesses eligible to 
deduct common State expenses?
    Mr. Cole. We have not taken a position on changing that 
legislation. We think that is something that the U.S. Congress 
should probably in its wisdom take up and debate and determine 
what the appropriate course of action should be.
    Senator Blumenthal. But it would probably be consistent 
with your memorandum to have those expenses deducted, as long 
as none of the other priorities are infringed on.
    Mr. Cole. Well, our memorandum is really focused on what 
the federal enforcement will be of the Controlled Substances 
Act. There are obviously other issues that spin off of that 
that do need to be dealt with, and I think those are the kinds 
of things that the Senate and the House can debate and 
determine if there is an appropriate policy change to be made.
    Senator Blumenthal. And, finally, let me ask you about 
Connecticut. Have there been consultations with Connecticut 
officials about the implementation of that law?
    Mr. Cole. Not that I am aware of right now, but the U.S. 
Attorney there I am sure has been in touch with them. But I am 
not positive.
    Senator Blumenthal. Thank you.
    Thank you, Mr. Chairman.
    Chairman Leahy. Thank you very much.
    Senator Whitehouse. Mr. Chairman.
    Chairman Leahy. Yes, Senator Whitehouse.
    Senator Whitehouse. May I make one point before the Deputy 
Attorney General is excused?
    Chairman Leahy. Of course.
    Senator Whitehouse. You have three former prosecutors here, 
and so we clearly appreciate the flexibility that it is 
important for prosecutors to have, and we clearly appreciate 
the discretion that prosecutors enjoy and that should be 
protected by the Department. But at the same time, I think the 
Department would be well advised to listen to Senator 
Grassley's advice about trying to establish as clear metrics as 
you comfortably can, because there can be a lot of unintended 
consequences from the broad zone of uncertainty that you can 
create, and that can frankly be quite harmful in and of itself.
    So I think in this area, and particularly with respect to 
the regulatory regimes and what you would expect to approve and 
disapprove, the more you can move toward the kind of metrics 
that Senator Grassley recommended, I think the better off you 
would be. I speak only for myself on that, but I think it is--
that is my advice, anyway.
    Senator Blumenthal. If I may add, Mr. Chairman, I would 
second what Senator Whitehouse has just said, particularly as 
Senator Grassley has pointed out some of the banking 
implications. In Connecticut, my understanding is that some 
bankers are reluctant currently to be involved with marijuana 
businesses because they are fearful about violating federal 
law. And the clearer and more definitive you can make your 
expressions of prosecutorial policy, I think the more helpful 
it will be to them insofar as they are aiding legitimate 
businesses, not criminal enterprises, not businesses selling to 
minors and others who may violate your priorities. So I would 
second what Senator Whitehouse has just said.
    Thank you.
    Chairman Leahy. Thank you very much. And, Mr. Cole, thank 
you very much.
    Mr. Cole. Thank you, Mr. Chairman.
    Chairman Leahy. We will call up Sheriff Urquhart, who is 
the King County sheriff; Jack Finlaw, who is the chief legal 
counsel in the office of Governor Hickenlooper; and Kevin 
Sabet, who is the co-founder and director of Project SAM.
    Sheriff Urquhart is the elected sheriff of King County in 
Washington State. He is the sheriff of the State's largest 
metropolitan county, so I think he is particularly qualified to 
help us here. Sheriff Urquhart has been in law enforcement for 
more than 35 years. He has been a patrol officer, field 
training officer, master police officer, street-level vice and 
narcotics detective, public information officer, and 
administrative aide to several sheriffs.
    Sheriff, would you go ahead and give your statement? 
Incidentally, I am advised we may have another Syria meeting, 
but all statements will be placed in the record in full. You 
will also be able, when you see the record, to add to things 
you said. So I would ask you to summarize your statement within 
the five minutes.
    And I hate to say this, Sheriff, because I know you and 
others have traveled some distance to get here, and I 
appreciate you being here. Sheriff, go ahead.

STATEMENT OF HON. JOHN URQUHART, SHERIFF, KING COUNTY SHERIFF'S 
                  OFFICE, SEATTLE, WASHINGTON

    Mr. Urquhart. Thank you, Mr. Chairman, and at the risk of 
stating the obvious, I am a police officer. Thank you for 
having me here today. My name is John Urquhart. I am the 
sheriff of King County, Washington.
    Seattle is located in King County, and with almost two 
million residents, we are the 14th largest county by population 
in the United States. I have over 1,000 employees in the 
sheriff's office and a budget exceeding $160 million.
    As sheriff, I am, therefore, the top law enforcement 
official in the largest jurisdiction in the country that has 
legalized marijuana.
    I have been a police officer for 37 years, and I was 
elected as King County's sheriff last year. During my career, I 
have investigated everything from shoplifts to homicides. But I 
have also spent almost 12 years as a narcotics detective. My 
experience shows me that the War on Drugs has been a failure. 
We have not significantly reduced demand over time, but we have 
incarcerated generations of individuals, the highest 
incarceration rate in the world.
    So the citizens of the State of Washington decided it was 
time to try something new. And in November 2012, they passed 
Initiative 502, which legalized recreational amounts of 
marijuana and at the same time created very strict rules and 
laws.
    I was a strong supporter of Initiative 502 last year, and I 
remain a strong supporter today. There are several reasons for 
that support. Most of all, I support 502 because that is what 
the people want. They voted for legalized marijuana. We, the 
government, have failed the people, and now they want to try 
something else. Too often the attitude of the police is, ``We 
are the cops and you are not. Don't tell us how to do our 
job.'' That is the wrong attitude, and I refuse to fall into 
that trap.
    While the title of this hearing is conflict between State 
and federal marijuana laws, I do not see a huge conflict.
    The reality is we do have complementary goals and values. 
We all agree we do not want our children using marijuana. We 
all agree we do not want impaired drivers. We all agree we do 
not want to continue enriching criminals. Washington's law 
honors these values by separating consumers from gangs and 
diverting the proceeds from the sale of marijuana toward 
furthering the goals of public safety.
    Is legalizing and regulating the possession and sale of 
marijuana a better alternative? I think it is, and I am willing 
to be proven wrong. But the only way we will know, however, is 
if we are allowed to try.
    DOJ's recent decision provides clarity on how we in 
Washington can continue to collaborate with the Federal 
Government to enforce our drug laws while at the same time 
respecting the will of the voters.
    It is a great step, but more needs to be done.
    I hate to beat a dead horse here, but, for example, we are 
still limited by not knowing the role of banking institutions 
as we go forward.
    Under federal law, it is illegal for banks to open 
checking, savings, or credit card accounts for marijuana 
businesses. The result is that marijuana stores will be 
operated as cash only, creating two big problems for me as a 
police officer: Cash-only businesses are prime targets for 
armed robberies; and cash-only businesses are very difficult to 
audit, leading to possible tax evasion, wage theft, and 
diversion of the resources we need to protect public safety.
    I am simply asking the Federal Government to allow banks to 
work with legitimate marijuana businesses who are licensed 
under this new State law.
    In closing, let me make one thing abundantly clear. What we 
have in Washington State is not the Wild Wild West. And as 
sheriff, I am committed to continued collaboration with the 
DEA, FBI, and DOJ for robust enforcement of our respective drug 
laws. For example, I have detectives right now that are 
assigned to federal task forces, including a DEA HIDTA Task 
Force. It has been a great partnership for many years, and that 
partnership will continue.
    Furthermore, the message to my deputies has been very 
clear: You will enforce our new marijuana laws. You will write 
somebody a ticket for smoking in public. You will enforce age 
limits. You will put unlicensed stores out of business. In 
other words, the King County Sheriff's Office will abide by the 
standards and laws voted on and adopted by the citizens of the 
State of Washington and the guidance provided by the Department 
of Justice on August 29th.
    Mr. Chairman, I say to you and the Members of this 
Committee, I do appreciate the deference the Federal Government 
has shown to my constituents, and I look forward to continuing 
that cooperation. Thank you.
    [The prepared statement of Mr. Urquhart appears as a 
submission for the record.]
    Chairman Leahy. Thank you.
    I am going to have each of the witnesses testify, and then 
we will go to questions. But certainly the testimony based on 
35 years' experience in law enforcement is extremely helpful.
    Mr. Finlaw is the chief legal counsel for the Governor of 
Colorado, John Hickenlooper. He served as co-chair of the task 
force that recommended the legislation and rules to implement 
Colorado's new constitutional provisions legalizing the 
possession, use, and sale of marijuana in the State. He thus 
has a unique perspective of the challenges facing States. They 
deal with the conflict between State and federal marijuana 
laws, and I believe prior to your current position, you were 
chief of staff to the mayor of Denver. Is that correct?
    Mr. Finlaw. That is correct.
    Chairman Leahy. Thank you. Please go ahead, sir.

   STATEMENT OF JACK FINLAW, CHIEF LEGAL COUNSEL, OFFICE OF 
        GOVERNOR JOHN W. HICKENLOOPER, DENVER, COLORADO

    Mr. Finlaw. Thank you, Chairman Leahy, Ranking Member 
Grassley, Members of the Committee. I have been working for the 
past 10 months with a really large collection of Coloradans--
stakeholders, government officials, members of the marijuana 
industry--to put together what we will affirm to you is a 
robust and strong enforcement regime.
    You know, the voters of Colorado approved what we called 
Amendment 64 in 2012 by about 55 percent of the vote, even 
though the Governor, the Attorney General, and State leaders 
opposed the ballot initiative. But we determined with that sort 
of clear statement from the people of Colorado, we needed to 
effectively and efficiently implement the law. We began through 
a stakeholder process, through a task force, followed by very 
detailed enabling legislation by the Colorado General Assembly, 
and now just yesterday, the Colorado Department of Revenue 
issued 141 pages of regulations to regulate the industry.
    Within days of passage of Amendment 64, the Governor, our 
Attorney General, got on the phone with General Holder and 
began this conversation about this conflict of federal and 
State law. And although we just recently, as we have talked 
about today, received official guidance, we do want to 
recognize that General Holder, the Justice Department, our U.S. 
Attorney, was very forthcoming about expressing federal law 
enforcement's concerns about this new legalization effort, and 
it really allowed us to focus our efforts to develop a robust 
regulatory and enforcement regime for marijuana in Colorado.
    One of the things we did besides passing bills to regulate 
the industry, we enhanced tools for law enforcement by passing 
a new law that gives law enforcement the ability to better 
address the issues of impaired driving. We now have a law that 
provides that if a driver's blood contains five nanograms or 
more of THC, there is a permissible inference that the driver 
was driving under the influence.
    We really appreciate the collaboration we have had with 
federal officials. We know we have more to do. As has been 
discussed today, we have audits critical of some of the things 
we have done in the past to address. I will say that the main 
reason that we have had failures of regulation of our medical 
marijuana industry is because we have lacked the resources to 
hire staff and partner with law enforcement. But we are sending 
to the voters this fall a marijuana tax measure that will 
provide the kind of revenue we need to hire staff to also work 
on public health issues related to marijuana and education and 
prevention efforts that we are determined to focus on.
    The bottom line is we commend the Department of Justice for 
this guidance that they have issued in the new Cole memo. We 
think it was, for us, timely clarification because we were in 
the final weeks of doing our rules, and so we got it in time to 
make sure that our rules complied with the enforcement 
priorities outlined in the Cole memo. We actually affirm and 
embrace those eight priorities, and we look forward to working 
with the Federal Government. Our Department of Public Safety, 
our local law enforcement will work with federal law 
enforcement. We have a great working relationship with our U.S. 
Attorney, and I think that you will discover that not only will 
Colorado's regulators and law enforcement want to partner with 
federal law enforcement, but the industry will as well.
    One of the things I have discovered in working on marijuana 
issues over the last 10 months is how entrepreneurial, how much 
integrity the folks in our State that have developed these new 
businesses have. I would compare them to folks that you have 
all met as you have toured wineries in Napa or gone to 
distilleries in your State, Mr. Chairman. I know they make some 
great rye whiskey in Vermont. These are the same types of folks 
who have established medical marijuana dispensaries, grow 
operations in Colorado, and they will be partners with us in 
making sure that minors do not have access to marijuana, that 
the marijuana does not flow to Iowa or other States.
    I think that we look forward to a very successful 
regulatory regime, and I will echo the sheriff's comments and 
other comments we have heard today about the banking issue. It 
is both a law enforcement issue and a regulatory issue, and 
also the tax issue.
    So we look forward to working with our Members of Congress 
to address those issues.
    [The prepared statement of Mr. Finlaw appears as a 
submission for the record.
    Chairman Leahy. Well, thank you, Mr. Finlaw.
    And, without objection, I will also put in the written 
testimony of Washington Governor Jay Inslee and Washington 
Attorney General Bob Ferguson in the record. Their views are 
also important and relevant.
    [The information referred to appears as a submission for 
the record.]
    Chairman Leahy. Our next witness is Kevin Sabet, who is the 
co-founder and director of Project SAM, Smart Approaches to 
Marijuana, and the director of the Drug Policy Institute of the 
University of Florida. He previously served in the Office of 
National Drug Control Policy in various capacities. He has 
written extensively about this topic.
    Please go ahead.

  STATEMENT OF KEVIN A. SABET, PH.D., DIRECTOR, UNIVERSITY OF 
   FLORIDA DRUG POLICY INSTITUTE, DEPARTMENT OF PSYCHIATRY, 
   DIVISION OF ADDICTION MEDICINE; AND DIRECTOR, PROJECT SAM 
   (SMART APPROACHES TO MARIJUANA), CAMBRIDGE, MASSACHUSETTS

    Mr. Sabet. Thank you, Chairman Leahy, Ranking Member 
Grassley, and distinguished Members of the Committee, for 
providing me with the opportunity to appear before you today to 
discuss marijuana policy.
    As mentioned, I have studied, researched, and written about 
drug policy for almost 18 years. I am currently the director 
and co-founder, with former Congressman Patrick Kennedy, of 
Project SAM (Smart Approaches to Marijuana).
    Because we share the Obama administration's drug control 
goals of reducing drug abuse and its consequences, I and dozens 
of prevention, treatment, medical, and scientific groups around 
the country found the recent guidance by the Department of 
Justice disturbing on both legal and policy grounds. The 
guidance, which expressly defers the Department's right to 
challenge and preempt laws legalizing marijuana, contradicts 
the Controlled Substances Act, both on the policy and legal 
level, especially policy principles designed to protect public 
health and safety.
    Colorado and Washington have now been given the green light 
to become the first jurisdictions in the world to allow for the 
creation of large, for-profit marijuana entities, far 
surpassing any reforms in Europe.
    Now, I think I should mention that the Controlled 
Substances Act is an important tool for public health. In fact, 
by keeping marijuana illegal, its use is a sixth and a third 
lower than alcohol and tobacco, respectively, in the United 
States.
    I applaud the way the Controlled Substances Act has been 
used so far by the Federal Government--not to go after low-
level users with an addiction problem, but instead to target 
drug traffickers and producers. This is not about putting 
marijuana smokers in jail. In fact, analyses have long debunked 
the myths that our prison cells are full of people whose only 
crime was smoking marijuana.
    Indeed, as a side note, if we were today to let out every 
single person in the United States for any drug offense, our 
incarceration rate in the U.S. would be four times its 
historical high, not five times. Still a massive incarceration 
problem, regardless of drug offenses.
    Now, we do not have to wait for legalization to happen. For 
several years, many States like Colorado have been operating 
with a de facto legalization policy under the guise of 
medicine. In fact, we can get--and anybody who has been to 
Colorado since 2009 can get--a sense of full legalization. Mass 
advertising and promotion, using items that are attractive to 
kids, whether they are ``medical marijuana lollipops,'' ``Ring 
Pots,'' ``Pot-Tarts'' to mimic Pop Tarts. These are all 
characteristics of current policies.
    The result, as mentioned, has been an increase in drug-
related referrals for high school students and more 
unintentional marijuana poisonings now reaching children as 
young as five. And the fact that three-quarters of kids in 
treatment in Colorado today report that their marijuana came 
from a medical marijuana dispensary.
    Now, this is all consistent with the recent National Bureau 
of Economic Research paper conducted by RAND researchers that 
found that two distinct features in marijuana policy increases 
use. Those two features are home cultivation and legal 
dispensaries. Now, these are found, obviously, in some States 
that have legalized this under medicine.
    Now, this should matter because, despite popular myth, 
scientists from the American Medical Association, the American 
Academy of Pediatrics, the American Psychological Association, 
the American Society of Addiction Medicine--and we could go on 
and on--are universal in stating that marijuana is harmful for 
young people. Marijuana use, especially among young people, is 
significantly associated with a reduction in IQ, mental 
illness, poor learning outcomes, lung damage, and addiction. 
According to NIH, one out of every six kids who tries marijuana 
will become addicted, and last year, 400,000 emergency room 
admissions were applicable for marijuana.
    Now, in Colorado, though traffic fatalities have fallen 
over the last six years, marijuana-related fatalities on the 
roads have increased.
    Now, we already have evidence showing that in some cases, 
quote-unquote, medical marijuana is going to criminal 
enterprises and foreign drug-trafficking groups. We know, as 
Senator Grassley mentioned, about the diversion to other States 
and interdiction, and we also know, as mentioned, that two very 
damning State audits released in the last month shows that 
there has been no, quote-unquote, seed-to-sale nonvertical 
integration of marijuana policy in States that have allowed 
this for medical purposes. How on Earth can we think that a 
task so much more infinitely difficult of full legalization is 
going to be handled any better?
    Now, right now, we are at a precipice. By threatening legal 
action, the administration can prevent the large-scale 
commercialization of marijuana. In fact, you all know, after 
spending decades of fighting Big Tobacco, we are now on the 
brink of creating Big Marijuana. An executive from Microsoft is 
teaming up with a former president of Mexico in their assertion 
that they will mint more millionaires than Microsoft in their 
creation of the Starbucks of Marijuana. This is what people in 
public health care about. The issue of a small amount used by 
an adult in the privacy of their own home is not what the 
initiatives in Colorado and Washington are about.
    So I would just conclude by saying when we can prevent the 
negative consequences of commercial sale and production of 
marijuana now, why would we open the floodgates, hope for the 
best, and try with our limited resources later to patch 
everything up when things go wrong?
    Thank you.
    [The prepared statement of Mr. Sabet appears as a 
submission for the record.]
    Chairman Leahy. Thank you very much.
    Let me go back to Sheriff Urquhart, because you have heard 
what Dr. Sabet has said, and others. And I am interested in 
your insight with 35 years in law enforcement, a significant 
part of that as a narcotics detective. Your sheriff's 
department is larger than all our law enforcement in Vermont 
put together. Those who criticize your State's initiative have 
asked whether legalizing small amounts of marijuana could 
result in increased drugged driving or illegal use by minors, 
cross-border trafficking. You have heard all those concerns. 
How do you address them from a public safety point of view?
    Mr. Urquhart. I think what we need to do is continue doing 
what we have been doing all along, which is really robust 
enforcement. This is not going to change a whole lot. The rules 
that are in place or about to be in place in the State of 
Washington put a limit on the amount of marijuana that can be 
produced, and with the idea that they are only going to match 
demand. They are not going to produce enough so it can be 
exported to other States.
    Now, that is not to say illegal marijuana grows, like I am 
sure is going on in Colorado, are not going to be exported. But 
we can go after those, and we will go after those. We do not 
expect what is grown legally under the new system to be 
exported.
    As far as driving, under this new law we now have a way to 
go after people that are driving under the influence of 
marijuana. In the past, it was very, very difficult to get a 
conviction. Now we have a per se standard of five nanograms per 
milliliter of blood. Now we have a standard that we can use, 
just like we use 0.08 for driving under the influence of 
alcohol. We never had that before.
    So one of the things that I am doing is retraining many of 
my deputies so they can be drug recognition experts, so when 
they go to the scene of a suspected drugged driver who is under 
the influence of narcotics, where there is any narcotic or 
marijuana, they can test that driver to see if they need to 
arrest that person and take them in for a blood test. It is 
something brand new.
    Chairman Leahy. I am not even sure we have that standard in 
my State of Vermont. I recall the frustration as a prosecutor 
when I was there because we did not have a standard we could 
use. Alcohol was easy. We had a very strict standard.
    So your commitment is to enforce the law as it is in your 
State. Are there areas where the Federal Government can help 
you?
    Mr. Urquhart. Absolutely. And I think the clarifying letter 
that came out on August 29th helped immensely. It removed the 
uncertainty that we had. It knows that they are going to allow 
the citizens of the State of Washington what they want, and 
what they want is legalized marijuana. And that is a very big 
deal, I think. It is going to take the criminal element as best 
we can out of the sale of marijuana, and that really was 
brought home to me just two nights ago when I was here in 
Washington, D.C. My chief of staff here in the front row, Chris 
Beringer, and I went out to dinner. We went to Old Ebbitt's 
Grill just two or three blocks from the White House. We are 
walking back to our hotel. It is about nine o'clock at night, 
but it is dark. We saw two gentlemen, young gentlemen, college 
age, walked up to a man standing on the corner, and says, 
``Hey, can I get some weed around here? ''
    Now, they certainly did not come up to us, but they did go 
up----
    Chairman Leahy. I take it you were not in your uniform.
    Mr. Urquhart. I was not wearing this outfit, no.
    [Laughter.]
    Mr. Urquhart. But they did go up to the most sketchy guy on 
the block--the most sketchy guy on the block--to try and buy 
weed. That is going to go away in Washington, because they can 
go into a store--not a Starbucks store. They can go into a 
free-standing store and buy their marijuana legally. So they 
know what they are going to get. They know what the price is 
going to be. They do not have to go to that criminal element on 
the street corner at nine o'clock at night and solicit somebody 
to sell them marijuana. Our 502 is going to eliminate all of 
that, and that is a huge step forward.
    Chairman Leahy. My time is almost up, but I want to ask Mr. 
Finlaw a similar question, because I understand that Governor 
Hickenlooper did not support the constitutional amendment to 
legalize marijuana in Colorado, but it is very clear from your 
testimony that you intend to follow the law and make sure it 
works.
    I understand that the lack of access to financial services, 
and the inability to deduct business expenses, for example, 
from federal taxes, are cited as hurdles to successful 
regulation of the marijuana business. Am I correct in that?
    Mr. Finlaw. Yes, Chairman Leahy, you are correct. Thank you 
for raising that issue. You can understand that these 
businesses that are cash-only, that have dozens of employees, 
payroll to make; they are dealing with cash, not with credit 
cards, they are having to find loans from disreputable 
financial institutions, it is a great challenge. It is a 
criminal challenge as well as a regulatory challenge. It is 
criminal, of course, because any business that has that much 
cash on hand and is having to transport it is ripe for robbery.
    It is also a regulatory challenge, because it will be so 
much easier to audit the books to make sure that the taxes are 
being paid, make sure that the rules that we put in place are 
being followed if the folks are doing business with a bank or 
credit union or other financial institution.
    Chairman Leahy. Thank you. My time is up. I have further 
questions that I can submit for the record.
    Senator Grassley.
    Senator Grassley. I have a couple questions for Mr. Finlaw 
and one for Mr. Sabet. I will start with you, Mr. Finlaw. There 
has been a sharp uptick in drug-related suspensions and 
expulsions in Colorado schools in recent years, and in the 
State's second largest city, Colorado Springs, drug-related 
referrals for high school students testing positive for 
marijuana has increased every year between 2007 and 2012.
    With legalization for recreational use, the challenges to 
protect youth will increase, and yet I understand that under 
certain circumstances the rules in Colorado will allow for 
marijuana advertising on television and radio. The rules will 
permit marijuana businesses to maintain Web sites that could be 
accessible by children, and the rules will permit marijuana-
themed magazines to be sold in stores within the reach of 
children.
    My question is: If I am right on those things I just cited, 
won't all these rules all effectively allow marijuana 
advertising to children? And then why do you believe that 
Colorado can successfully protect children from marijuana?
    Mr. Finlaw. Senator Grassley, you raise some really 
important issues that we have been grappling with. Even the 
constitutional amendment authorizing marijuana has typically 
said that advertising directly to children can be prohibited. 
The enabling legislation and the new rules also do the same. So 
we have tried to develop rules that are narrowly focused on 
making sure that, whether it is print, television, radio, Web 
advertising, that it will not be targeted at young people. 
Cartoon characters and other advertising that would be 
particularly appealing to young people are prohibited.
    The final rule, which was based upon testimony at our 
rulemaking hearings, provides that if there is to be 
advertising for marijuana, there has to be documentary evidence 
that the audience--that no more than 30 percent of the audience 
is young people. So that advertising will be restricted.
    The problem we have had, one of the rules that was adopted 
in May has already been voided under First Amendment grounds. 
So we have First Amendment issues to grapple with as we try to 
restrict advertising.
    But the good news is that the voters of Colorado are going 
to have an opportunity to approve a new tax in November that 
will give us the resources to develop sort of best practices 
for education and prevention efforts.
    So what we intend to do is counter any ads with very, very 
strong and effective programming that will be public service 
programming that will be geared toward young people to let them 
know that--because we agree with you. We believe that for 
adolescents, marijuana is a danger, and we intend to educate 
them.
    Senator Grassley. Okay. Also, Mr. Finlaw, you had an 
interview with NPR in February: ``We have very strict controls 
over who can have access to medical marijuana.''
    There was an audit by your State in June concluded by the 
Colorado Department of Public Health ``does not''--let me start 
over again. But an audit by your State in June concluded that 
the Colorado Department of Public Health ``does not 
sufficiently oversee physicians who make medical marijuana 
recommendations.'' The audit noted that one physician had 
recommended marijuana for over 8,400 patients.
    Would you still stand by your statement that Colorado has 
strict control over who can have access to marijuana? And if 
so, why would you stand by it? And why with these damaging 
audit findings should the Department of Justice have confidence 
that Colorado can implement robust regulation of recreational 
marijuana?
    Mr. Finlaw. Thank you. You are right. As a matter of fact, 
in our conversation with General Holder just a few weeks ago, 
he raised the same question to us. He asked us about those 
audits, and he told us we needed to address the issues that are 
raised in those audits, and we are committed to doing that.
    The particular audit you talked about is the regulation 
over doctors who issue prescriptions. What I meant when I was 
quoted in February was that we have got really good medical 
marijuana rules and regulations. What we have not done a good 
job of is enforcing those because we have lacked the resources.
    With the new tax coming, with the advent of legalized 
marijuana, we will have the resources to hire staff to enhance 
our oversight of doctors, of those other businesses that are 
involved in the marijuana world.
    Senator Grassley. My time is up. I will submit one question 
to you and one to Mr. Sabet for answer in writing. Thank you.
    [The questions of Senator Grassley appear as submissions 
for the record.]
    Senator Whitehouse [presiding]. Sheriff Urquhart, let me 
ask you, are you familiar with the eight federal interest areas 
in the----
    Mr. Urquhart. Yes.
    Senator Whitehouse. Are you satisfied with those?
    Mr. Urquhart. Yes.
    Senator Whitehouse. From a law enforcement perspective, you 
think that they are adequate and appropriate?
    Mr. Urquhart. Absolutely, and we will have no problem 
meeting those at all. Now, some of them do not apply 
necessarily straight to the sheriff's office, but many of them 
do. But from what I have seen from the regulatory standpoint 
that the State is enacting, I think it is going to work out 
very well. I have no problem with those whatsoever, and I thank 
the Justice Department for coming forward with those when they 
did.
    Senator Whitehouse. And, presumably, given all your years 
in law enforcement and your years as a narcotics investigator, 
you have worked with the Federal Government on federal 
investigations in the past in various capacities, correct?
    Mr. Urquhart. That is correct. And my detectives are doing 
that currently, yes.
    Senator Whitehouse. And are there current activities 
basically in the same areas that these eight federal interest 
areas provide for? Or do you see any areas of activity that you 
are undertaking now that would stop?
    Mr. Urquhart. No, not at all. In fact, a week ago, we 
assisted with serving several federal search warrants and 
confiscated $193,000, several guns, heroin, methamphetamine, 
marijuana, and we do that all the time. And that is not going 
to change. Our cooperation with the Federal Government is not 
going to change one iota because of Initiative 502.
    Senator Whitehouse. And so by limiting itself to those 
eight areas of federal interest, you do not see that reducing 
the federal law enforcement footprint in the State of 
Washington in any significant respect?
    Mr. Urquhart. Absolutely not.
    Senator Whitehouse. Very good.
    From a public health and safety point of view, Mr. Finlaw, 
how do you feel about the eight areas of federal interest? Are 
they adequate from your perspective?
    Mr. Finlaw. We also embrace those. The task force that we 
have put together to implement our new law developed guiding 
principles, and they were amazingly parallel with the Justice 
Department's guidance to us. And while this was a formalization 
of guidance, we really appreciate the fact that throughout this 
process the Justice Department, particularly through our U.S. 
Attorney's Office, has been very forthcoming about their 
general concerns about this new law, and it really allowed us 
to focus as we developed our legislative and regulatory 
response.
    Senator Whitehouse. And you are the Governor's legal 
counsel.
    Mr. Finlaw. Yes.
    Senator Whitehouse. A great job. I used to have that job. 
You have the responsibility of representing the Governor in the 
legal negotiations about the enforcement program, the 
regulatory program. Say a word, if you will, about the comments 
that Senator Blumenthal and I concluded Deputy Attorney General 
Cole's testimony with about the importance of the Department 
providing metrics that are as clear as possible so that people 
know what the rules are that they will be engaging in.
    Mr. Finlaw. Well, let me affirm what both you and Senator 
Blumenthal said. We and I believe that the industry itself in 
Colorado would really appreciate that sort of guidance. Our 
Department of Public Safety, our State Patrol, our Bureau of 
Investigation in Colorado, along with local law enforcement all 
will appreciate definitive guidance, and I think it will--when 
the day comes, if there is evidence of an operation that is 
appealing to young people or exporting marijuana grown in 
Colorado to other States, an enforcement action that shuts that 
down would be welcome by us.
    Senator Whitehouse. My time has nearly expired but, Dr. 
Sabet, I assume that your policy disagreement with the choice 
to decriminalize or make medical marijuana available would 
drive your answer to all those questions. You are opposed to 
the metrics. You are opposed to the eight areas of interest. 
You think that we should just continue along the previous path?
    Mr. Sabet. Well, not necessarily. I mean, I think the eight 
provisions are as agreeable as baseball and apple pie. I do not 
know anybody who would say that those provisions are not 
helpful. The issue is--which I think you bring up, which is 
very helpful--how are we going to be monitoring and what are 
the specific metrics that the Federal Government is going to 
use to trigger enforcement.
    Senator Whitehouse. So prospective metrics are very 
important?
    Mr. Sabet. They are extremely important. You know, 
yesterday there were 4,000 joints publicly passed out in 
Colorado by the campaign, who used to be in favor of 
legalization, now is against the tax, and they just launched 
their campaign by handing out 4,000 joints publicly. At a 
marijuana festival in Seattle a month or two ago, 50,000 people 
smoked marijuana publicly. I mean, so if we are talking about 
actually doing the enforcement at the local level, I just have 
not seen the evidence so far that we are going to try and rein 
in these big industries that are going to advertise on the 
Internet legally. I do not know any kid who watches TV anymore. 
It is all on social media. Advertisements in these two States 
will be legal on the Internet for kids.
    These are the kinds of things that worry the Academy of 
Pediatrics and others and myself, and so we will be monitoring 
this with a very watchful eye.
    Senator Whitehouse. Got it. Well, we look forward to 
working with you on that, and I want to extend through you my 
personal best wishes to Congressman Kennedy, who was a 
colleague in my delegation for many years and who I respect 
very greatly.
    Mr. Sabet. Thank you.
    Senator Whitehouse. Senator Blumenthal.
    Senator Blumenthal. I would say the same, if you could pass 
along my best wishes. And as I understand your position, it is 
not so much against legalization but the evils and abuses that 
may be the result. And I wonder if you could say--I know you 
alluded to it in your testimony--whether, in fact, those evils 
or abuses have, in fact, occurred in Colorado and Washington. 
And what would be your advice to Connecticut?
    Mr. Sabet. Sure. Well, I have definitely seen them already 
occurring in these States, and I do not--you know, I understand 
State officials are in very difficult positions here trying to 
implement these laws that have been passed by a majority of 
their voters. But the effects of what we have seen, for 
example, in a State like Colorado, where less than two percent 
of people with cards that authorize them to use marijuana 
medically have cancer, HIV, or any other serious chronic 
illness, that we have seen them being handed out like candy, 
that we have seen the mass advertising already, that worries 
me. What we see with the public use of marijuana in places like 
Washington, especially in places like Seattle, that worries me.
    So, again, I just do not see the evidence of--although it 
is a difficult task of trying to implement something robust and 
trying to enforce that, especially in the face of an industry 
that will be pushing back against every single kind of 
provision like putting magazines that advertise marijuana just 
behind the counter so they are--and I know the Governor tried 
to do that and then dropped that lawsuit when it was 
challenged. Or, you know, things like in Washington State how 
you--although packaging will be sterile, you can still have, 
you know, gummy, candy-shaped, attractive to kids marijuana 
products. You can still have marijuana products that are 
edibles, that are actually sometimes a thing that is sending 
more people to ERs than even joints in terms of an 
inexperienced marijuana user eating a marijuana brownie that 
has very concentrated forms of THC in that brownie all at once, 
that can be a very traumatic experience for some people. So I 
do not see any of that being regulated, and that is what I 
worry about.
    In terms of the position that SAM and others and myself 
have put forward, you know, again, I think we are positing that 
in a country with the First Amendment, in a country that has 
seen the alcohol and tobacco industries relentlessly target 
kids--and, by the way, target addicts because these industries 
do not make money off of casual users. The marijuana industry 
does not make money off of the person who decides once every 10 
years to light up a joint. The industries--alcohol and tobacco 
are included--make money off of addiction. They make money off 
of the small amount of users that consume the vast amount of 
the volume.
    What I worry is that inevitably in this country American-
style legalization is commercialization, is promotion, no 
matter the best interests that State officials and regulators 
and liquor control boards and others try and implement. So that 
is the worry. It is not about imprisoning people for small 
amounts. It is not about saddling people with criminal records 
who get caught with a small amount. It is about this mass 
commercialization.
    Senator Blumenthal. I wonder if the two other witnesses 
reacting to the points that have just been made about the 
problems that have arisen under the Colorado and Washington 
laws would respond.
    Mr. Finlaw. You know, I think that we do agree with the 
concerns that Dr. Sabet has raised with respect to the dangers 
of products that are designed for young people, and so we have 
put into place some significant restrictions on packaging and 
labeling. The gummy bear story, you are right, it is a problem. 
And our Department of Public Health, our regulators who are 
looking over the licensed premises, will be making sure that 
those types of packages, that type of promotion for young 
people does not happen in Colorado. It has happened, 
admittedly, in the past, but we are going to redouble our 
efforts to make sure that young people do not have 
encouragement and do not take the fact that it is now legal for 
adults as a sign that it is good for kids.
    Mr. Urquhart. I think there are some urban myths that are 
floating around out there that Seattle is going to turn into 
the Starbucks of Marijuana, for example, that 50,000 people 
were all smoking at Hemp Fest in downtown Seattle a couple of 
weeks ago, that there is going to be gummy bears infused with 
marijuana. That is just not going to happen in the State of 
Washington. Big business is not going to take over the 
marijuana business, the legal marijuana business in the State 
of Washington. There is no vertical integration allowed. The 
processors and the growers of marijuana cannot own retail 
stores. Only three retail stores can be owned by one owner, for 
example. No advertising. Security, surveillance systems. Lots 
and lots of protections in place to make sure marijuana is not 
sold, marketed to people under the age of 21 or used by people 
under the age of 21 in any way, shape, or form.
    We realize what is going on. We are going to avoid that 
when it comes to legalizing marijuana for recreational 
purposes.
    Senator Blumenthal. Thank you.
    Thank you, Mr. Chairman. My time has expired. Thank you to 
all of you for being here today.
    Senator Whitehouse. Thank you. Well, that brings this 
hearing to its conclusion. Let me thank Deputy Attorney General 
Cole and our three witnesses on the second panel for their 
contributions to our understanding and work on this issue.
    For those who wish to add anything to the record of this 
hearing, the record will be maintained open for one additional 
week. But other than that, we are adjourned

    [Whereupon, at 4:25 p.m., the Committee was adjourned.]
    
                            A P P E N D I X

              Additional Material Submitted for the Record

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         Prepared Statement of Ranking Member Charles Grassley

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              Prepared Statement of Chairman Patrick Leahy

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 Prepared Statement of Hon. James Cole, Deputy Attorney General, U.S. 
                 Department of Justice, Washington, DC

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    Prepared Statement of Hon. John Urquhart, Sheriff, King County 
                 Sheriff's Office, Seattle, Washington

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   Prepared Statement of Jack Finlaw, Chief Legal Counsel, Office of 
            Governor John W. Hickenlooper, Denver, Colorado

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 Prepared Statement of Kevin A. Sabet, Ph.D., Director, University of 
 Florida Drug Policy Institute, Department of Psychiatry, Division of 
  Addiction Medicine; and Director, Project SAM (Smart Approaches to 
                  Marijuana), Cambridge, Massachusetts

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                               Questions

   Questions submitted by Senator Dianne Feinstein for James M. Cole
   

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   Questions submitted by Senator Charles Grassley for James M. Cole

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     Questions submitted by Senator Patrick Leahy for James M. Cole

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      Questions submitted by Senator Al Franken for James M. Cole

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   Questions submitted by Senator Charles Grassley for John Urquhart

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    Questions submitted by Senator Charles Grassley for Jack Finlaw

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    Questions submitted by Senator Charles Grassley for Kevin Sabet

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                                Answers


 Responses of James M. Cole to questions submitted by Senators Leahy, 
                        Grassley, and Feinstein

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  Responses of John Urquhart to questions submitted by Senator Franken

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 Responses of John Urquhart to questions submitted by Senator Grassley

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  Responses of Jack Finlaw to questions submitted by Senator Grassley

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  Responses of Kevin Sabet to questions submitted by Senator Grassley

[GRAPHIC] [TIFF OMITTED] 
                Miscellaneous Submissions for the Record


Letter to Attorney General Eric Holder from Steven F. Lukan, Director, 
             Iowa Governor's Office of Drug Control Policy

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 Letter to Attorney General Eric Holder from National Law Enforcement 
   Organizations in Hennepin County, Minnesota; Hughes County, South 
     Dakota; Association of State Criminal Investigative Agencies; 
    International Association of Chiefs of Police; Police Executive 
     Research Forum; and National Narcotic Associations' Coalition

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 Letter to Attorney General Eric Holder from the Former Administrators 
           of the Drug Enforcement Administration (1973-2007)

[GRAPHIC] [TIFF OMITTED] 

Letter to Senator Leahy from Dennis J. Gallagher, City Auditor, Denver, 
                                Colorado

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  Americans for Safe Access, ``Three Areas of Inquiry for `Conflicts 
              Between State and Federal Marijuana Laws' ''

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  Tamar Todd, Senior Staff Attorney, Drug Policy Alliance, Office of 
                        Legal Affairs, statement

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   Governor Jay Inslee and Attorney General Bob Ferguson, Washington 
                            State, statement

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  Letter to Senator Leahy from Mark A.R. Kleiman, Professor of Public 
 Policy, UCLA Luskin School of Public Affairs, Los Angeles, California

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  Letter to Senator Leahy from Hon. Dana Rohrabacher, 49th District, 
                               California

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 Letter to Senator Leahy from We Can Do Better Coalition: Sue Rusche, 
  National Families in Action; A. Thomas McLellan, Treatment Research 
  Institute; Kevin Sabet, Project SAM (Smart Approaches to Marijuana)

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         Hon. Ed Perlmutter, 7th District, Colorado, statement

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     Letter to Treasury Secretary Lew, Chairman Bernanke, Chairman 
 Gruenberg, Comptroller Curry, Director Corday, and Chairman Matz from 
 Hon. Ed Perlmutter, 7th District, Colorado, and Hon. Denny Heck, 10th 
                       District, Washington State

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  Letter to Senator Leahy from Lori Augustyniak, Prevention Works! VT

[GRAPHIC] [TIFF OMITTED] 


                                   [all]