To take care of #5, mandatory drug tests, with criminal penalties for same.
One possible problem is that Class IIIs can relatively easily transfer between police agencies, but if sold to the public, it might give an opportunity for the feds to horn in, which they would.
Since they have been the biggest advocates of police paramilitarization, I have no doubt they would try to prevent de-paramilitarization if at all possible.
There is also a sneaky one hidden in here, that the feds provide them with advanced communications equipment designed for the feds to tap into. Both directly and indirectly. A big part of de-paramilitarization is to build a wall between local police and the feds, so that either have to go through the state police.
A lot of the problem is based in the RICO law, because when the feds make a bust in a local jurisdiction, they automatically give 10% of the ‘take’ to the locals, even if they were not in. The local police are “allowed” to spend this money on all sorts of surplus military equipment and weapons. In the 1990s, I believe the ‘local take’ for police nationwide was about $600 million.
So de-paramilitarization is a big project, and not an easy one, because it will upset many federal schemes.