BILL NUMBER: SB 1262	AMENDED
	BILL TEXT

	AMENDED IN SENATE  APRIL 21, 2014

INTRODUCED BY   Senator Correa

                        FEBRUARY 21, 2014

   An act to add Article 25 (commencing with Section 2525) to Chapter
5 of Division 2 of the Business and Professions Code, and to add
Article 7 (commencing with Section 111657) to Chapter 6 of Part 5 of
Division 104 of the Health and Safety Code, relating to medical
marijuana.



	LEGISLATIVE COUNSEL'S DIGEST


   SB 1262, as amended, Correa. Medical marijuana: regulation of
physicians, dispensaries, and cultivation sites.
   (1) Existing law, the Compassionate Use Act of 1996, an initiative
measure enacted by the approval of Proposition 215 at the November
6, 1996, statewide general election, authorizes the use of marijuana
for medical purposes. Existing law enacted by the Legislature
requires the establishment of a program for the issuance of
identification cards to qualified patients so that they may lawfully
use marijuana for medical purposes, and requires the establishment of
guidelines for the lawful cultivation of marijuana grown for medical
use.
   This bill would require the State Department of Public Health to
license dispensing facilities and cultivation sites that provide,
process, and grow marijuana for medical use, as specified, and would
make these licenses subject to the restrictions of the local
jurisdiction in which the facility operates or proposes to operate.
The bill would require the department to establish standards for
quality assurance testing of medical marijuana and would prohibit the
use of nonorganic pesticides in any marijuana cultivation site. The
bill would require licensed dispensing facilities and licensed
cultivation sites to implement sufficient security measures to both
deter and prevent unauthorized entrance into areas containing
marijuana and theft of marijuana at those facilities, including
establishing limited access areas accessible only to authorized
facility personnel, and would require these facilities to notify
appropriate law enforcement authorities within 24 hours after
discovering specified breaches in security.  The bill would
require licensed dispensing facilities to verify that the
recommending physician and surgeon is licensed to practice medicine
in California before providing a marijuana product to a  
patient. This bill would prohibit the distribution of any form of
advertising for physician recommendations for medical marijuana
unless the advertisement bears a specified no   tice and
requires that the advertisement meet specified requirements and not
be fraudulent, deceitful, or misleading, as specified.  The bill
would make enforcement of these provisions the responsibility of the
county health departments, with oversight by the department.
Violation of these provisions would be punishable by a civil fine of
up to $35,000 for each individual violation. By expanding the duties
of local health officers, this bill would impose a state-mandated
local program.
   (2) Existing law, the Medical Practice Act, provides for licensure
and regulation of physicians and surgeons by the Medical Board of
California.
   This bill would establish requirements for a physician and surgeon
to recommend medical marijuana, including prescribed procedural and
recordkeeping requirements, and would require a recommendation for
medical marijuana for a  minor   person under 21
years of age  to include a specific justification for the
recommendation and why the benefit of use is more important than the
possible neurological damage that could be caused by the 
minor   person  using marijuana and to be approved
by a board certified pediatrician.  The bill would require a
physician and surgeon that recommends medical marijuana to report to
the board the number of recommendations issued, with supporting
documentation on patient medical need.  
   This bill would require the board to audit a physician and surgeon
who recommends medical marijuana more than 100 times in a year to
ensure compliance with existing law and would require the board to
establish a certification process for physicians who wish to issue
medical marijuana recommendations, including a mandatory training in
identifying signs of addiction and ongoing substance abuse. 

   This bill would require the board, by January 1, 2016, to convene
a task force of experts in the use of medical marijuana to review and
update, as necessary, guidelines for recommending medical marijuana,
as specified. 
   Violation of these provisions would be punishable by a civil fine
not to exceed $5,000  . The bill would make the recommendation of
medical marijuana without a prior examination and medical indication
and recommendation of medical marijuana for nonmedical purposes
unprofessional conduct, to be punished as provided  .  The
bill would also make it a misdemeanor for a physician and surgeon who
recommends marijuana to a patient for a medical purpose to accept,
solicit, or offer any remuneration from or to a   licensed
dispensing facility in which the physician and surgeon or his or her
immediate family has a financial interest. By creating a new crime,
this bill would impose a state-mandated local program.  

   (3) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.  
   This bill would provide that, if the Commission on State Mandates
determines that the bill contains costs mandated by the state,
reimbursement for those costs shall be made pursuant to these
statutory provisions.  
   The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.  
   This bill would provide that with regard to certain mandates no
reimbursement is required by this act for a specified reason. 

   With regard to any other mandates, this bill would provide that,
if the Commission on State Mandates determines that the bill contains
costs so mandated by the state, reimbursement for those costs shall
be made pursuant to the statutory provisions noted above. 
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  The Legislature finds and declares all of the
following:
   (a) The California Constitution grants cities and counties the
authority to make and enforce, within their borders, "all local
police, sanitary, and other ordinances and regulations not in
conflict with the general laws." This inherent local police power
includes broad authority to determine, for purposes of public health,
safety, and welfare, the appropriate uses of land within the local
jurisdiction's borders. The police power, therefore, allows each city
and county to determine whether or not a medical marijuana
dispensary or other facility that makes medical marijuana available
may operate within its borders. This authority has been upheld by
City of Riverside v. Inland Empire Patients Health & Wellness, Inc.
(2013) 56 Cal.4th 729 and County of Los Angeles v. Hill (2011) 192
Cal.App.4th 861.
   (b) If, pursuant to this authority, a city or county determines
that a dispensary or other facility that makes medical marijuana
available may operate within its borders, then there is a need for
the state to license these dispensaries and other facilities for the
purpose of adopting and enforcing protocols for training and
certification of physicians who recommend the use of medical
marijuana and for agricultural cultivation practices. This licensing
requirement is not intended in any way nor shall it be construed to
preempt local ordinances regarding the sale and use of medical
marijuana, including, but not limited to, security, signage,
lighting, and inspections. 
   (c) Given that the current system of all-cash transactions within
the medical marijuana industry is unsustainable in the long term,
there is a need to provide a monetary structure, as an alternative to
the federal banking system, for the operation, regulation, and
taxation of medical marijuana dispensaries.  
   (d) 
    (c)  All of the following elements are necessary to
uphold important state goals:
   (1) Strict provisions to prevent the potential diversion of
marijuana for recreational use.
   (2) Audits to accurately track the volume of both product movement
and sales.
   (3) An effective means of restricting access to medical marijuana
by  minors,   persons under 21 years of age
  given the medical studies documenting marijuana's
harmful and permanent effects on the brain development of youth
 . 
   (4) Stricter provisions relating to physicians and their
recommendation procedures in order to address widespread problems of
questionable medical marijuana recommendations by physicians without
a bona-fide doctor-patient relationship with the person to whom they
are issuing the recommendation.  
   (e) 
    (d)  Nothing in this act shall be construed to promote
or facilitate the nonmedical, recreational possession, sale, or use
of marijuana.
  SEC. 2.  Article 25 (commencing with Section 2525) is added to
Chapter 5 of Division 2 of the Business and Professions Code, to
read:

      Article 25.  Recommending Medical Marijuana


   2525.  (a) Prior to recommending marijuana to a patient pursuant
to Article 2.5 (commencing with Section 11362.7) of Chapter 6 of
Division 10 of the Health and Safety Code, a physician and surgeon
shall meet all of the following requirements:
   (1) Have a  bona fide  doctor-patient 
relationship, with medical marijuana recommendations to be made by a
patient's primary care physician or by a physician and surgeon to
whom the patient is referred by their primary care physician
  relationship  .
   (2) Conduct an  in-person   appropriate prior
 examination  of the pa  tient  to establish
 the patient's need for medical marijuana   that
medical use of marijuana is appropriate  .
   (3) Consult with the patient as necessary and periodically review
the treatment's efficacy.
   (b) A physician and surgeon that recommends medical marijuana
shall do all of the following:
   (1)  Address, in the recommendation, the quantity of use
and method of delivery, including   Include  a
discussion of side effects.  If the recommended method of
delivery is smoking, the recommendation shall state the reasons for
selecting this method of delivery in the context of health issues
created by smoking. 
   (2) Address, in the recommendation, what kind of marijuana to
obtain, including high tetrahydrocannabinol (THC) levels, low THC
levels, high cannabidiol (CBD) levels, low CBD levels, and explain
the reason for recommending the particular strain. Under no
circumstances shall a physician and surgeon recommend butane hash
oil.
   (3) Maintain a system of recordkeeping that supports the decision
to recommend the use of medical marijuana for individual patients.
   (c) A recommendation for medical marijuana provided to a 
minor   person under 21 years of age  shall
 include a specific justification for the recommendation and
why the benefit of use is more important than the possible
neurological damage that could be caused by the minor using
marijuana. A recommendation for a minor shall  be approved
by a board certified pediatrician. A recommendation for a 
minor   person under 21 years of age  shall be for
high CBD marijuana and all recommendations for  minors must
  persons under 21 years of   age shall 
be for nonsmoking delivery. 
   2525.1.  (a) A physician and surgeon who recommends medical
marijuana shall report to the California Medical Board the number of
recommendations issued, with supporting documentation on patient
medical need. The board shall forward these reports to the State
Department of Public Health.
   (b) A physician and surgeon who makes more than 100
recommendations in a calendar year shall be audited by the California
Medical Board to determine compliance with Article 2.5 (commencing
with Section 11362.7) of Chapter 6 of Division 10 of the Health and
Safety Code.  
   2525.2.  The California Medical Board shall establish a
certification process for physicians who wish to issue medical
marijuana recommendations, including a mandatory training in
identifying signs of addiction and ongoing substance abuse. 

   2525.1.  (a) It is unlawful for a physician and surgeon who
recommends marijuana to a patient for a medical purpose to accept,
solicit, or offer any form of remuneration from or to a facility
licensed pursuant to Article 7 (commencing with Section 111657) of
Chapter 6 of Part 5 of Division 104 of the Health and Safety Code if
the physician and surgeon or his or her immediate family have a
financial interest in that facility.
   (b) For the purposes of this section, "financial interest" shall
have the same meaning as in Section 650.01.
   (c) A violation of this section shall be a misdemeanor.  

   2525.2.  The board, by January 1, 2016, shall convene a task force
of experts in the use of medical marijuana to review and update, as
necessary, guidelines for recommending medical marijuana to ensure
competent review in cases concerning the recommendation of marijuana
for medical purposes. 
   2525.3.   (a)    In addition to all other
remedies available pursuant to this chapter, violation of any
provision of this article shall be punishable by a civil fine of up
to five thousand dollars ($5,000). 
   (b) Recommending marijuana to a patient for a medical purpose
without an appropriate prior examination and a medical indication, or
recommending marijuana for a nonmedical purpose shall constitute
unprofessional conduct and may be punished pursuant to Article 12
(commencing with Section 2220). 
  SEC. 3.  Article 7 (commencing with Section 111657) is added to
Chapter 6 of Part 5 of Division 104 of the Health and Safety Code, to
read:

      Article 7.  Medical Marijuana


   111657.  For purposes of this article, the following definitions
shall apply:
   (a) "Department" means the State Department of Public Health.
   (b) "Licensed cultivation site" means a facility that grows or
grows and processes marijuana for medical use and that is licensed
pursuant to Section 111657.1.
   (c) "Licensed dispensing facility" means a dispensary, mobile
dispensary, marijuana processing facility, or other facility that
provides marijuana for medical use that is licensed pursuant to
Section 111657.1.
   111657.1.  (a) Except as provided in Section 11362.5 of, and
Article 2.5 (commencing with Section 11362.7) of Chapter 6 of
Division 10 of, the Health and Safety Code, a person shall not sell
or provide marijuana other than at a licensed dispensing facility.
   (b) Except as provided in Section 11362.5 of, and Article 2.5
(commencing with Section 11362.7) of Chapter 6 of Division 10 of, the
Health and Safety Code, a person shall not grow or process marijuana
other than at a licensed cultivation site.
   (c) The department shall require, prior to issuing a license to a
dispensing facility or a cultivation site, all of the following:
   (1) The name of the owner or owners of the proposed facility.
   (2) The address and telephone number of the proposed facility.
   (3) A description of the scope of business of the proposed
facility.
   (4) A certified copy of the local jurisdiction's approval to
operate within its borders.
   (5) A completed application, as required by the department.
   (6) Payment of a fee, in an amount to be determined by the
department not to exceed the amount necessary, but that is sufficient
to cover, the actual costs of the administration of this article.
   (7) Any other information as required by the department.
   111657.2.  The department shall, after consulting with outside
entities as needed, establish standards for quality assurance testing
of medical marijuana, to ensure protection against microbiological
contaminants. Nonorganic pesticides shall not be used in any
marijuana cultivation site, irrespective of size or location.
   111657.3.  (a) A licensed dispensing facility shall not acquire,
possess, cultivate, deliver, transfer, transport, or dispense
marijuana for any purpose other than those authorized by Article 2.5
(commencing with Section 11362.7) of Chapter 6 of Division 10.
   (b) A licensed dispensing facility shall not acquire marijuana
plants or products except through the cultivation of marijuana by
that facility, if the facility is a licensed cultivation site, or
another licensed cultivation site. 
   111657.4.  A licensed dispensing facility shall not provide a
marijuana product to a patient until it verifies that the
recommending physician and surgeon is licensed to practice medicine
in California.  
   111657.5.  (a) A person shall not distribute any form of
advertising for physician recommendations for medical marijuana in
California unless the advertisement bears the following notice to
consumers:

   NOTICE TO CONSUMERS: The Compassionate Use Act of 1996 ensures
that seriously ill Californians have the right to obtain and use
marijuana for medical purposes where medical use is deemed
appropriate and has been recommended by a physician who has
determined that the person's health would benefit from the use of
marijuana. Physicians are licensed and regulated by the Medical Board
of California and arrive at the decision to make this recommendation
in accordance with accepted standards of medical responsibility.
California law prohibits advertising that includes statements of
bait, discount, premiums, gifts, or any statements of a similar
nature.

   (b) Advertising for physician recommendations for medical
marijuana shall meet all requirements of Section 651 of the Business
and Professions Code. Price advertising shall not be fraudulent,
deceitful, or misleading, including statements or advertisements of
bait, discount, premiums, gifts, or statements of a similar nature.

    111657.4.   111657.6.   (a) A facility
licensed pursuant to this article shall implement sufficient security
measures to both deter and prevent unauthorized entrance into areas
containing marijuana and theft of marijuana at those facilities.
These security measures shall include, but not be limited to, all of
the following:
   (1) Allow only registered qualifying patients, personal
caregivers, and facility agents access to the facility.
   (2) Prevent individuals from remaining on the premises of the
facility if they are not engaging in activity expressly related to
the operations of the facility.
   (3) Establish limited access areas accessible only to authorized
facility personnel.
   (4) Store all finished marijuana in a secure, locked safe or vault
and in a manner as to prevent diversion, theft, and loss.
   (b) A facility licensed pursuant to this article shall notify
appropriate law enforcement authorities within 24 hours after
discovering any of the following:
   (1) Discrepancies identified during inventory.
   (2) Diversion, theft, loss, or any criminal activity involving the
facility or a facility agent.
   (3) The loss or unauthorized alteration of records related to
marijuana, registered qualifying patients, personal caregivers, or
facility agents.
   (4) Any other breach of security.
   (c) A licensed cultivation site shall weigh, inventory, and
account for on video, all medical marijuana to be transported prior
to its leaving its origination location. Within eight hours after
arrival at the destination, the licensed dispensing facility shall
re-weigh, re-inventory, and account for on video, all transported
marijuana.
    111657.5.   111657.7.   (a) Enforcement
of this article shall be the responsibility of the county health
departments, with oversight by the department.
   (b) An enforcement officer may enter a facility licensed pursuant
to this article during the facility's hours of operation and other
reasonable times to do either of the following:
   (1) Conduct inspections, issue citations, and secure samples,
photographs, or other evidence from the facility, or a facility
suspected of being a dispensing facility or cultivation site.
   (2) Secure as evidence documents, or copies of documents,
including inventories required pursuant to subdivision (c) of Section
 111657.4   111657.6  , or any record,
file, paper, process, invoice, video, or receipt for the purpose of
determining compliance with this chapter.
   (c) A written report shall be made and a copy shall be supplied or
mailed to the owner of the facility at the completion of an
inspection or investigation.
   (d) Upon request by the department, local governments shall
provide the department with reports on the number and types of
facilities operating within their jurisdiction.
    111657.6.   111657.8.   In addition to
the provisions of this article, a license granted pursuant to this
article shall be subject to the restrictions of the local
jurisdiction in which the facility operates or proposes to operate.
Even if a license has been granted pursuant to this article, a
facility shall not operate in a local jurisdiction that prohibits the
establishment of that type of business.
    111657.7.   111657.9.   Violation of
this provision shall be punishable by a civil fine of up to
thirty-five thousand dollars ($35,000) for each individual violation.

   111657.10.  Nothing in this article shall prevent a city or other
local governing body from doing any of the following:
   (a) Adopting and enforcing local ordinances that regulate the
location, operation, or establishment of medical marijuana
cooperatives or collectives.
   (b) The civil and criminal enforcement of local ordinances
described in subdivision (a).
   (c) Enacting other laws consistent with this article.

  SEC. 4.    If the Commission on State Mandates
determines that this act contains costs mandated by the state,
reimbursement to local agencies and school districts for those costs
shall be made pursuant to Part 7 (commencing with Section 17500) of
Division 4 of Title 2 of the Government Code. 
   SEC. 4.    No reimbursement is required by this act
pursuant to Section 6 of Article XIII B of the California
Constitution for certain costs that may be incurred by a local agency
or school district because, in that regard, this act creates a new
crime or infraction, eliminates a crime or infraction, or changes the
penalty for a crime or infraction, within the meaning of Section
17556 of the Government Code, or changes the definition of a crime
within the meaning of Section 6 of Article XIII B of the California
Constitution.  
   However, if the Commission on State Mandates determines that this
act contains other costs mandated by the state, reimbursement to
local agencies and school districts for those costs shall be made
pursuant to Part 7 (commencing with Section 17500) of Division 4 of
Title 2 of the Government Code.