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How Colorado Intends Protect Marijuana Industry from a Possible Federal Crackdown

Colorado is contemplating an uncommon strategy to safeguard its nascent marijuana industry from a possible federal crackdown even at the expense of hundreds of millions of dollars in tax collections.

A bill pending in the Legislature would enable marijuana growers and retailers to reclassify their recreational marijuana as medical marijuana if a change in federal law or enforcement happens.

It’s the boldest effort yet by a U.S. marijuana state to prevent federal intervention in its weed market.

The bill would enable Colorado’s 500 or so licensed recreational marijuana growers to immediately reclassify their weed. A change would cost the state more than $100 million a year because Colorado taxes medical marijuana far more lightly than recreational marijuana — 2.9 percent versus 17.9 percent.

The measure says licensed growers could instantly become medical licensees based on a business need as a result of change in local, state or federal law or enforcement policy. The change wouldn’t take recreational marijuana off the books, but nevertheless, it wouldn’t completely safeguard it either. What it could do is help growers protect their inventory in case federal authorities begin confiscating recreational marijuana.

The provision is receiving plenty of attention in the marijuana industry following recent opinions from members of President Donald Trump’s administration. White House spokesman Sean Spicer has said there’s a “big difference” between recreational and medical marijuana.

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