Oklahoma Supreme Court declines challenge to Marijuana license fee increases

Oklahoma Supreme Court declines challenge to Marijuana license fee increases

Oklahoma Supreme Court Defers Challenge to Medical Marijuana License Fee Hikes.

The Oklahoma Supreme Court declined this week to consider a challenge to a bill dramatically raising fees associated with medical marijuana licenses, kicking the lawsuit down to district court in Oklahoma County.

The decision not to exercise jurisdiction at this point was contained in a brief order and supports the position of the Oklahoma attorney general’s office. Seven justices concurred, one dissented and one did not vote.

The case was filed in June, when a law went into effect raising license fees for medical marijuana dispensaries, growers, processors and testing laboratories.

The fees for all had been a flat $2,500. The new law established fee structures for growers that can top $50,000 a year based on the size of the operation. 

The lawsuit, filed by a grower, a dispensary, a processor and the founder of Oklahomans for Responsible Cannabis Action, claims the Oklahoma Legislature violated constitutional provisions required for the passage of revenue, or tax, bills.

The Oklahoma attorney general’s office argued that the bill was not a revenue measure subject to the constitutional provisions cited by the marijuana businesses, primarily because it was approved not to raise money — the state had a huge budget surplus already — but to increase public safety by decreasing the oversupply of marijuana.

What to know about Oklahoma's medical marijuana license fees at issue

The fees are licensing fees meant to compensate the Oklahoma Medical Marijuana Authority for regulating the industry, the state attorneys told the Supreme Court, and “this court has never held that a license fee paid by a regulated industry is a tax.”

“The only growers, processors, and dispensaries that will see increases are those that produce a disproportionately large amount of marijuana. Those businesses place greater strains on OMMA.”

The attorney general’s office said the argument that the law discriminates among businesses in the medical marijuana industry was meritless because the new law applies equally to all businesses within the distinct categories.

And, even if that were not the case, the law would pass muster because the fee structure has a valid legislative objective — decreasing the oversupply of marijuana, the state attorneys said.

“The tiered system ensures that growers and processors that inject the most marijuana into the market pay more for the resulting regulatory strain,” the state argued.

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Region: Oklahoma

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