Marijuana Moment: Nebraska Legislature Passes Medical Marijuana Regulation And Funding Bill

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“Appears there may be a light at the end of the tunnel. Fingers crossed.”

By Zach Wendling, Nebraska Examiner

The Nebraska Legislature approved its first-ever bill related to a state medical cannabis program Wednesday, which regulators say is key to getting the medicine to Nebraskans.

Lawmakers voted 46-2 to pass Legislative Bill 1235, led by the General Affairs Committee. The bill would give the voter-created regulatory commission the ability to set fees and raise revenue. With other funding in LB 1071’s state budget adjustments, approved 35-13 Wednesday as well, the Nebraska Medical Cannabis Commission could soon hire its first dedicated staff.

The commission did not formally support or oppose LB 1235, but lawmakers made clear the measure was introduced on the commission’s behalf.

The legislation would have initially expanded commission authority to regulate patients, caregivers and medical providers, authority not contemplated in the ballot measure creating the commission that 67 percent of voters passed in 2024. Those provisions were removed.

In the same 2024 election, 71 percent of voters legalized possession of up to 5 ounces of medical cannabis for patients and their caregivers with a health care practitioner’s recommendation.

Lawmakers have estimated getting medical cannabis to patients might still be at least a year out. When it does, the medicine would not be subject to sales taxes under current law.

LB 1235 ultimately passed with four main components, as well as other provisions related to alcohol and liquor regulation:

• Paying medical cannabis commissioners a salary of $12,500 for their work.
• Creating a dedicated state cash fund to collect legislative funding, fees, gifts, grants and other monies collected by the commission, which can be used for medical cannabis regulation.
• Authorizing the commission to set application fees, such as for cultivators, manufacturers and dispensaries, of up to $50,000.
• Requiring applicants for registered medical cannabis establishment licenses to submit fingerprints for a background check, which the commission was already doing.

The state budget changes, at the recommendation of Gov. Jim Pillen (R), would give the Nebraska Liquor Control Commission, which houses the Medical Cannabis Commission, an additional $1.38 million this fiscal year ending June 30 and $1 million for the next fiscal year.

Medical Cannabis Commissioner Lorelle Mueting of Gretna, interim commission chair, in mid-March described LB 1235 as a “first step.”

Commissioner J. Michael Coffey of Omaha, a retired district judge, had said delays were not intentional but “more or less a practical hurdle we had to get over,” in part because of limitations on ballot measure campaigns. Authorizing spending, for instance, belongs to the Legislature.

“Appears there may be a light at the end of the tunnel,” Coffey said in March. Added Mueting right after: “Fingers crossed.”

This story was first published by Nebraska Examiner.

Photo courtesy of Brian Shamblen.

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