Amended in Senate May 7, 2014

Amended in Senate April 21, 2014

Senate Bill No. 1262

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, begin insert including requiring a background check for license applicants, end insert and would make these licenses subject to the restrictions of the local jurisdiction in which the facility operates or proposes to operate. begin delete 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. end delete 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. begin delete 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. end delete This bill would prohibit the distribution of any form of advertising for physician recommendations for medical marijuana unless the advertisement bears a specified notice and requires that the advertisement meet specified requirements and not be fraudulent, deceitful, or misleading, as specified. begin delete The bill would make enforcement of these provisions the responsibility of the county health departments, with oversight by the department. end delete Violation of these provisions would be punishable by a civil fine of up to $35,000 for each individual violation. begin delete By expanding the duties of local health officers, this bill would impose a state-mandated local program. end delete

(2) Existing law, the Medical Practice Act, provides for licensure and regulation of physicians and surgeons by the Medical Board of California.

begin delete

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 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 person using marijuana and to be approved by a board certified pediatrician.

end delete

This bill would require the begin delete board, by January 1, 2016, to convene a task force of experts in the use of medical marijuana to review and update, as necessary, end delete begin insert board to consult with the Center for Medical Cannabis Research on developing and adopting medical end insert guidelines for begin delete recommending medical end delete begin insert the appropriate administration and use of end insert marijuana begin delete , as specified end delete .

begin delete 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. end delete 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.

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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.

end delete begin delete

This bill would provide that with regard to certain mandates no reimbursement is required by this act for a specified reason.

end delete begin delete

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.

end delete begin insert

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.

end insert begin insert

This bill would provide that no reimbursement is required by this act for a specified reason.

end insert

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) 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 persons under 21 years of age.

(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

 

begin delete

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 doctor-patient relationship.

(2) Conduct an appropriate prior examination of the patient to
establish 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) Include a discussion of side effects.

(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
person under 21 years of age shall be approved by a board certified
pediatrician. A recommendation for a person under 21 years of
age shall be for high CBD marijuana and all recommendations for
persons under 21 years of age shall be for nonsmoking delivery.

end delete

begin delete 2525.1. end delete
begin insert 2525. end insert   

(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.

begin insert

begin insert 2525.1. end insert   

The board shall consult with the California Marijuana
Research Program, known as the Center for Medicinal Cannabis
Research, authorized pursuant to Section 11362.9 of the Health
and Safety Code, on developing and adopting medical guidelines
for the appropriate administration and use of marijuana.

end insert begin delete

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).

end delete

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.

begin insert

(7) (A) An applicant’s fingerprint images and related
information required by the Department of Justice for the purpose
of obtaining information as to the existence and content of a record
of state and federal convictions and arrests and information as to
the existence and content of a record of state and federal
convictions and arrests for which the Department of Justice
establishes that the person is free on bail, or on his or her own
recognizance, pending trial or appeal.

end insert begin insert

(B) The Department of Justice shall forward the fingerprint
images and related information received pursuant to subparagraph
(A) to the Federal Bureau of Investigation and request a federal
summary of criminal information. The Department of Justice shall
review the information returned from the Federal Bureau of
Investigation and compile and disseminate a response to the
department.

end insert begin insert

(C) The Department of Justice shall charge a fee sufficient to
cover the reasonable cost of processing the requests described in
this paragraph.

end insert begin delete

(7)

end delete begin insert

(D) The department may deny a license based on a past criminal
conviction if the crime is substantially related to the qualifications,
functions, or duties of the business for which the license will be
issued.

end insert

begin insert (8) end insert  Any other information as required by the department.

begin delete

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.

end delete

begin delete 111657.3. end delete
begin insert 111657.2. end insert   

(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.

begin delete

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.

end delete

begin delete 111657.5. end delete
begin insert 111657.3. end insert   

(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. begin delete California law prohibits advertising that
includes statements of bait, discount, premiums, gifts, or any
statements of a similar nature. end delete

(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.

begin delete 111657.6. end delete
begin insert 111657.4. end insert   

(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 begin delete registered end delete qualifying patients, begin delete personal caregivers end delete
begin insert the patient’s primary caregiver end insert , 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.

begin delete

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 111657.6, 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.

end delete

begin delete 111657.8. end delete
begin insert 111657.5. end insert   

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.

begin delete 111657.9. end delete
begin insert 111657.6. end insert   

Violation of this begin delete provision end delete begin insert article end insert shall be punishable
by a civil fine of up to thirty-five thousand dollars ($35,000) for
each individual violation.

begin delete

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.

end delete begin insert

begin insert 111657.7. end insert   

Nothing in this article shall prevent a city or other
local governing body from taking action as specified in Section
11362.83.

end insert

begin delete

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.

end delete

begin insert

begin insert SEC. 4. end insert   

end insert begin insert

No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because 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.

end insert