Despite Tough Talk, Oregon's U.S. Attorney Doesn't Plan to Shut Down the Pot Industry

Billy Williams wants to work with state marijuana regulators to address his concerns about "overproduction and diversion."



In the month since Attorney General Jeff Sessions rescinded Justice Department guidelines that discouraged prosecution of state-legal marijuana merchants, only one U.S. attorney, Oregon's Billy Williams, has publicly suggested he might respond by enforcing the federal ban on cannabis more aggressively. But judging from a meeting Williams held last Friday, he has no plans to target the state-licensed cannabusinesses that openly commit federal felonies every day.

Williams' main complaint, which he outlined in a January 5 interview with The Oregonian and an op-ed piece published by that paper a week later, is that Oregon, which legalized marijuana in 2014, produces more cannabis than is necessary to serve adult consumers within its borders. The surplus, he says, ends up in other states, which makes it a federal concern. "We have an identifiable and formidable marijuana overproduction and diversion problem," he said at last week's summit, which was attended by state officials, local police, and representatives of the FBI, the Drug Enforcement Administration, and U.S. attorneys in 13 other states. "And make no mistake about it, we're going to do something."

While that sounds rather ominous, Williams' attitude was collaborative rather than antagonistic. "My responsibility is to work with our state partners to do something about [the marijuana surplus]," he said. Oregon Gov. Kate Brown, whose goal is a "safe and successful cannabis industry," said, "Attorney Williams has assured my team that lawful Oregon businesses remain valued stakeholders in this conversation and not targets of law enforcement."

While there is no question that marijuana from Oregon is consumed in other states, that was also true before legalization, and it's not clear to what extent licensed growers are contributing to interstate smuggling. "What I need are bottom-line answers on what the numbers are," Williams said. "We need to have an accurate assessment of the problems we're looking at, because its time to tackle it."

In an interview with the Associated Press, hemp breeder Seth Crawford, who studied the marijuana market as a sociologist at Ohio State University, blamed the legal industry for producing too much cannabis. "If you were an investor and you had just dropped $4 million into a [marijuana] grow and you had thousands of pounds of flower that was ready to go but you had nowhere to sell it, the only thing you can do is sell it on the black market," he said. "It was a system designed for failure. You created this huge industry that has nowhere to put its product."

A.P. reported that Crawford "estimated Oregon growers produce up to three times the amount of marijuana that the state can absorb legally each year." Crawford tells me that is actually an understatement. "The state tracking system has 3 [times] the yearly consumption sitting as inventory right now," he writes in an email. If illegal cultivation is included, he says, "we produce far more than 3 [times] what we can consume."

Williams' comments imply that he does not want to stop Oregonians from consuming Oregon marijuana; he wants to stop residents of other states from consuming Oregon marijuana. Since law enforcement agencies have never managed to accomplish that, there is little reason to think they will succeed this time around. But there are ways that Oregon officials can placate Williams and allow him to declare victory.

Williams wants to "work with our state partners to do something." Here's something: Yesterday Oregon's secretary of state released an audit that suggests 17 ways for the Oregon Liquor Control Commission (OLCC) to improve its regulation of the cannabis industry. "Data reliability issues with self-reported data in the Cannabis Tracking System (CTS) and an insufficient number of trained compliance inspectors inhibit OLCC's ability to monitor the recreational marijuana program in Oregon," the report says. "OLCC should improve processes for ensuring the security and reliability of data in the CTS and the Marijuana Licensing System. In addition, better processes are needed to monitor vendors that host and support these applications."

Such regulatory improvements, possibly coupled with new limits on cultivation, would create the appearance of responding to Williams' worries about overproduction. They are also very much in the spirit of the guidelines that Sessions rescinded, which were predicated on the idea that well-regulated marijuana businesses would be less likely to implicate federal "enforcement priorities," including the prevention of interstate smuggling.

In other words, Williams' initiative is perfectly consistent with the policy of prosecutorial restraint that Sessions supposedly repudiated. Williams is not doing anything now he could not easily have done a month, a year, or two years ago. If this is the most dramatic result of Sessions' decision (which so far it is), the cannabis industry does not have much to worry about.

[This post has been corrected to clarify the source of Seth Crawford's comments.]