Amended in Assembly June 15, 2014

Amended in Senate May 27, 2014

Amended in Senate May 7, 2014

Amended in Senate April 21, 2014

Senate BillNo. 1262


Introduced by Senator Correa

February 21, 2014


An act tobegin insert amend Section 2220.05 of, toend insert add Article 25 (commencing with Section 2525) to Chapter 5 of Division 2 of, and to add Part 5 (commencing with Section 18100) to Division 7 of, the Business and Professions Code,begin insert to add Article 8 (commencing with Section 111658) to Chapter 6 of Part 5 of Division 104 of the Health and Safety Code, and to add Chapter 3.8 (commencing with Section 7295) to Part 1.7 of Division 2 of the Revenue and Taxation Code,end insert relating to medical marijuana.

LEGISLATIVE COUNSEL’S DIGEST

SB 1262, as amended, Correa. Medical marijuana: regulation of physicians, dispensaries,begin delete andend delete cultivationbegin delete sites.end deletebegin insert sites, and processing facilities.end insert

(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. Existing law provides for the licensure of various professionsbegin delete, including locksmiths and professional fiduciaries,end delete by the Department of Consumer Affairs.begin insert Existing law, the Sherman Food, Drug, and Cosmetic Law, provides for the regulation of food, drugs, devices, and cosmetics, as specified. A violation of that law is a crime.end insert

This bill would require the Department of Consumer Affairs to license dispensing facilitiesbegin delete andend deletebegin insert,end insert cultivation sitesbegin insert, and processing facilitiesend insert that provide, process, and grow marijuana for medical use, as specified, including requiring a background check for license applicantsbegin delete, andend deletebegin insert. The billend insert would make these licenses subject to the restrictions of the local jurisdiction in which the facility operates or proposes to operate. The bill wouldbegin insert, among other things,end insert requirebegin delete licensed dispensing facilities and licensed cultivation sitesend deletebegin insert licenseesend insert to implement sufficient security measures to both deter and prevent unauthorized entrance into areas containing marijuana and theft of marijuana atbegin delete thoseend deletebegin insert theirend insert facilities, including establishing limited access areas accessible only to authorized facility personnel, and would require thesebegin delete facilitiesend deletebegin insert licenseesend insert to notify appropriate law enforcement authorities within 24 hours after discovering specified breaches in security.begin delete Thisend deletebegin insert The bill would set forth provisions related to the transportation, testing, and distribution of marijuana. Theend insert bill would prohibit the distribution of any form of advertising for physician recommendations for medical marijuanabegin insert,end insert unless the advertisement bears a specified notice and requires that the advertisement meet specified requirements and not be fraudulent, deceitful, or misleading, as specified. Violation of these provisions would be punishable by a civil fine of up to $35,000 for each individual violation.

begin insert

The bill would provide that it shall not supersede provisions of Measure D, as approved by the voters of the City of Los Angeles, as specified.

end insert
begin insert

The bill would require the department to administer and enforce these provisions. The bill would require the department to establish quality assurance protocols by July 1, 2016, to ensure uniform testing standards of medical marijuana, and would require licensees to comply with these provisions. The bill would further set forth provisions regulating edible marijuana products, as specified. By adding these provisions to the Sherman Food, Drug, and Cosmetic Law, a violation of which is a crime, the bill would impose a state-mandated local program.

end insert

(2) Existing law, the Medical Practice Act, provides forbegin insert theend insert licensure and regulation of physicians and surgeons by the Medical Board of California.begin insert Existing law requires the board to prioritize investigations and prosecutions of physicians and surgeons representing the greatest threat of harm, as specified. Existing law identifies the cases that are to be given priority, which include cases of repeated acts of excessively prescribing, furnishing, or administering controlled substances without a good faith prior examination of the patient. Existing law provides that a violation of the Medical Practice Act is a crime.end insert

This bill would require the board to consult with the Center forbegin delete Medicalend deletebegin insert Medicinalend insert Cannabis Research on developing and adopting medical guidelines for the appropriate administration and use of marijuana.

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.

begin insert

The bill would provide that specified acts of recommending marijuana without a good faith examination are among the types of cases that should be given priority for investigation and prosecution by the board, as described above. The bill would further prohibit a person from recommending medical marijuana to a patient unless that person is the patient’s attending physician, as defined. Because a violation of that provision would be a crime, the bill would impose a state-mandated local program.

end insert
begin insert

(3) Existing law authorizes the legislative body of a city or county to impose various taxes, including a transactions and use tax at a rate of 0.25%, or a multiple thereof, if approved by the required vote of the legislative body and the required vote of qualified voters, and limits the combined rate of transactions and use taxes within a city or county to 2%.

end insert
begin insert

This bill would authorize the legislative body of a county to levy a tax on the privilege of cultivating, dispensing, producing, processing, preparing, storing, providing, or distributing marijuana or products containing marijuana. The bill would authorize the tax to be imposed for either general or specific governmental purposes. The bill would require a tax imposed pursuant to this authority to be subject to any applicable voter approval requirement.

end 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.

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

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.

The people of the State of California do enact as follows:

P4    1

SECTION 1.  

The Legislature finds and declares all of the
2following:

begin insert

3(a) In 1996, the people of the State of California enacted the
4Compassionate Use Act of 1996, codified in Section 11362.5 of
5the Health and Safety Code. The people of the State of California
6declared that their purpose in enacting the measure was, among
7other things, “to ensure that seriously ill Californians have the
8right to obtain and use marijuana for medical purposes where that
9medical use is deemed appropriate and has been recommended
10by a physician who has determined that the person’s health would
11benefit from the use of marijuana in the treatment of cancer,
12anorexia, AIDS, chronic pain, spasticity, glaucoma, arthritis,
13migraine, or any other illness for which marijuana provides relief.”

end insert
begin insert

14(b) The Compassionate Use Act of 1996 called on state
15government to implement a plan for the safe and affordable
16distribution of marijuana to all patients in medical need of
17marijuana.

end insert
begin insert

18(c) In 2003, the Legislature enacted the Medical Marijuana
19Program Act (MMPA), codified in Article 2.5 (commencing with
20Section 11362.7) of Chapter 6 of Division 10 of the Health and
21Safety Code.

end insert
begin insert

22(d) Greater certainty and minimum statewide standards are
23urgently needed regarding the obligations of medical marijuana
24facilities, and for the imposition and enforcement of regulations
25to prevent unlawful cultivation and the diversion of marijuana to
26nonmedical use.

end insert
begin insert

27(e) Despite the passage of the Compassionate Use Act of 1996
28and the MMPA, because of the lack of an effective statewide system
29for regulating and controlling medical marijuana, cities, counties
30and local law enforcement officials have been confronted with
P5    1uncertainty about the legality of some medical marijuana
2cultivation and distribution activities. The current system of
3collectives and cooperatives makes law enforcement difficult and
4endangers patient safety because of an inability to monitor the
5supply of medical marijuana in the state and the lack of quality
6control, testing, and labeling requirements.

end insert
begin delete

7(a)

end delete

8begin insert(f)end insert The California Constitution grants cities and counties the
9authority to make and enforce, within their borders, “all local
10police, sanitary, and other ordinances and regulations not in conflict
11with the general laws.” This inherent local police power includes
12broad authority to determine, for purposes of public health, safety,
13and welfare, the appropriate uses of land within the local
14jurisdiction’s borders. The police power, therefore, allows each
15city and county to determine whether or not a medical marijuana
16dispensary or other facility that makes medical marijuana available
17may operate within its borders. This authority has been upheld by
18City of Riverside v. Inland Empire Patients Health & Wellness,
19Inc. (2013) 56 Cal.4th 729 and County of Los Angeles v. Hill
20(2011) 192 Cal.App.4th 861.

begin delete

21(b)

end delete

22begin insert(g)end insert If, pursuant to this authority, a city or county determines
23that a dispensary or other facility that makes medical marijuana
24available may operate within its borders, then there is a need for
25the state to license these dispensaries and other facilities for the
26purpose of adopting and enforcing protocols for training and
27certification of physicians who recommend the use of medical
28marijuana and for agricultural cultivation practices. This licensing
29requirement is not intended in any way nor shall it be construed
30to preempt local ordinances regarding the sale and use of medical
31marijuana, including, but not limited to, security, signage, lighting,
32and inspections.

begin delete

33(c)

end delete

34begin insert(h)end insert All of the following elements are necessary to uphold
35important state goals:

36(1) Strict provisions to prevent the potential diversion of
37marijuana for recreational use.

38(2) Audits to accurately track the volume of both product
39movement and sales.

P6    1(3) An effective means of restricting access to medical marijuana
2bybegin delete persons under 21 years of ageend deletebegin insert minorsend insert.

begin delete

3(d)

end delete

4begin insert(i)end insert Nothing in this act shall be construed to promote or facilitate
5the nonmedical, recreational possession, sale, or use of marijuana.

6begin insert

begin insertSEC. 2.end insert  

end insert

begin insertSection 2220.05 of the end insertbegin insertBusiness and Professions Codeend insert
7begin insert is amended to read:end insert

8

2220.05.  

(a) In order to ensure that its resources are maximized
9for the protection of the public, the Medical Board of California
10shall prioritize its investigative and prosecutorial resources to
11ensure that physicians and surgeons representing the greatest threat
12of harm are identified and disciplined expeditiously. Cases
13involving any of the following allegations shall be handled on a
14priority basis, as follows, with the highest priority being given to
15cases in the first paragraph:

16(1) Gross negligence, incompetence, or repeated negligent acts
17that involve death or serious bodily injury to one or more patients,
18such that the physician and surgeon represents a danger to the
19public.

20(2) Drug or alcohol abuse by a physician and surgeon involving
21death or serious bodily injury to a patient.

22(3) Repeated acts of clearly excessive prescribing, furnishing,
23or administering of controlled substances, or repeated acts of
24prescribing, dispensing, or furnishing of controlled substancesbegin insert, or
25recommending marijuana to patients for medical purposes,end insert
without
26a good faith prior examination of the patient and medical reason
27therefor. However, in no event shall a physician and surgeon
28prescribing, furnishing, or administering controlled substances for
29intractable pain consistent with lawful prescribing, including, but
30not limited to, Sections 725, 2241.5, and 2241.6 of this code and
31Sections 11159.2 and 124961 of the Health and Safety Code, be
32prosecuted for excessive prescribing and prompt review of the
33applicability of these provisions shall be made in any complaint
34that may implicate these provisions.

35(4) Sexual misconduct with one or more patients during a course
36of treatment or an examination.

37(5) Practicing medicine while under the influence of drugs or
38alcohol.

39(b) The board may by regulation prioritize cases involving an
40allegation of conduct that is not described in subdivision (a). Those
P7    1cases prioritized by regulation shall not be assigned a priority equal
2to or higher than the priorities established in subdivision (a).

3(c) The Medical Board of California shall indicate in its annual
4report mandated by Section 2312 the number of temporary
5restraining orders, interim suspension orders, and disciplinary
6 actions that are taken in each priority category specified in
7subdivisions (a) and (b).

8

begin deleteSEC. 2.end delete
9begin insertSEC. 3.end insert  

Article 25 (commencing with Section 2525) is added
10to Chapter 5 of Division 2 of the Business and Professions Code,
11to read:

12 

13Article 25.  Recommending Medical Marijuana
14

 

15

2525.  

(a) It is unlawful for a physician and surgeon who
16recommends marijuana to a patient for a medical purpose to accept,
17solicit, or offer any form of remuneration from or to a facility
18licensed pursuant tobegin delete Article 7 (commencing with Section 111657)
19of Chapter 6 of Part 5 of Division 104 of the Health and Safety
20Codeend delete
begin insert Part 5 (commencing with Section 18100) of Division 7,end insert if
21the physician and surgeon or his or her immediate family have a
22financial interest in that facility.

23(b) For the purposes of this section, “financial interest” shall
24have the same meaning as in Section 650.01.

25(c) A violation of this section shall be a misdemeanor.

26

2525.1.  

The board shall consult with the California Marijuana
27Research Program, known as the Center for Medicinal Cannabis
28Research, authorized pursuant to Section 11362.9 of the Health
29and Safety Code, on developing and adopting medical guidelines
30for the appropriate administration and use of marijuana.

begin insert
31

begin insert2525.2.end insert  

No person shall recommend medical marijuana to a
32patient, unless that person is the patient’s attending physician, as
33defined by subdivision (a) of Section 11362.7 of the Health and
34Safety Code.

end insert
35

begin deleteSEC. 3.end delete
36begin insertSEC. 4.end insert  

Part 5 (commencing with Section 18100) is added to
37Division 7 of the Business and Professions Code, to read:

 

P8    1PART 5.  Medical Marijuana

2

 

3

18100.  

For purposes of thisbegin delete articleend deletebegin insert partend insert, the following
4definitions shall apply:

begin delete

5(a) “Department” means the Department of Consumer Affairs.

end delete
begin delete

6(b) “Licensed cultivation site” means a facility that grows or
7grows and processes marijuana for medical use and that is licensed
8pursuant to Section 18101.

end delete
begin delete

9(c) “Licensed dispensing facility” means a dispensary, mobile
10dispensary, marijuana processing facility, or other facility that
11provides marijuana for medical use that is licensed pursuant to
12Section 18101.

end delete
begin insert

13(a) “Certified testing laboratory” means a laboratory that is
14certified by the department to perform random sample testing of
15marijuana pursuant to the certification standards for these facilities
16promulgated by the department.

end insert
begin insert

17(b) “Department” means the Department of Consumer Affairs.

end insert
begin insert

18(c) “Dispensary” means a distribution operation that provides
19marijuana or marijuana derived products to patients.

end insert
begin insert

20(d) “Licensed cultivation site” means a facility that grows
21marijuana for medical use and that is licensed pursuant to Section
2218101.

end insert
begin insert

23(e) “Licensed dispensing facility” means a dispensary or other
24facility that provides marijuana for medical use that is licensed
25pursuant to Section 18101.

end insert
begin insert

26(f) “Licensed processing facility” means a facility where
27marijuana or marijuana products are inspected, packaged, labeled,
28or otherwise prepared prior to being provided to another facility
29licensed pursuant to this section, to a patient with a medical
30marijuana recommendation, or otherwise distributed, and that is
31licensed pursuant to Section 18101.

end insert
begin insert

32(g) “Licensed transporter” means an individual or entity
33licensed by the department to transport marijuana to and from
34facilities licensed pursuant to this part.

end insert
begin insert

35(h) “Marijuana” means marijuana, as defined by Section 11018
36of the Health and Safety Code.

end insert
37

18101.  

(a) Except as provided in Section 11362.5 of, and
38Article 2.5 (commencing with Section 11362.7) of Chapter 6 of
39Division 10 of, the Health and Safety Code, a person shall not sell
40or provide marijuana other than at a licensed dispensing facility.

P9    1(b) Except as provided in Section 11362.5 of, and Article 2.5
2(commencing with Section 11362.7) of Chapter 6 of Division 10
3of, the Health and Safety Code, a person shall not growbegin delete or processend delete
4 marijuana other than at a licensed cultivation site.

begin insert

5(c) Except as provided in Section 11362.5 of, and Article 2.5
6(commencing with Section 11362.7) of Chapter 6 of Division 10
7of, the Health and Safety Code, a person shall not process
8marijuana other than at a licensed processing facility.

end insert
begin insert

9(d) A person shall not transport marijuana from one facility
10licensed pursuant to this part to another, other than a licensed
11transporter.

end insert
begin insert

12(e) To meet the requirement of Sections 111658 to 111663,
13inclusive, of the Health and Safety Code, marijuana and marijuana
14products shall be tested by a certified testing laboratory.

end insert
begin delete

15(c) 

end delete

16begin insert(f)end insertbegin insertend insert The department shall require, prior to issuing a license to a
17dispensing facility or a cultivation sitebegin insert pursuant to this partend insert, all of
18the following:

19(1) The name of the owner or owners of the proposed facility.

20(2) The address and telephone number of the proposed facility.

21(3) A description of the scope of business of the proposed
22facility.

23(4) A certified copy of the local jurisdiction’s approval to operate
24within its borders.

25(5) A completed application, as required by the department.

26(6) Payment of a fee, in an amount to be determined by the
27department not to exceed the amount necessary, but that is
28sufficient to cover, the actual costs of the administration of this
29part.

30(7) (A) An applicant’s fingerprint images and related
31 information required by the Department of Justice for the purpose
32of obtaining information as to the existence and content of a record
33of state and federal convictions and arrests, and information as to
34the existence and content of a record of state and federal
35convictions and arrests for which the Department of Justice
36establishes that the person is free on bail, or on his or her own
37recognizance, pending trial or appeal.

38(B) The Department of Justice shall forward the fingerprint
39images and related information received pursuant to subparagraph
40(A) to the Federal Bureau of Investigation and request a federal
P10   1summary of criminal information. The Department of Justice shall
2review the information returned from the Federal Bureau of
3Investigation and compile and disseminate a response to the
4department.

5(C) The Department of Justice shall charge a fee sufficient to
6cover the reasonable cost of processing the requests described in
7this paragraph.

8(D) The department may deny a license based on a past criminal
9conviction if the crime is substantially related to the qualifications,
10functions, or duties of the business for which the license will be
11issued.

begin insert

12(8) In the case of a cultivation site, the GPS coordinates of the
13site.

end insert
begin delete

14(8)

end delete

15begin insert(9)end insert Any other information as required by the department.

begin insert

16(g) The department shall deny a license if the application fails
17to state with sufficient specificity the jurisdiction in which the
18applicant proposes to establish operations.

end insert
begin insert

19(h) Each application for a license approved by the department
20pursuant to this part is separate and distinct. A licensee shall not
21hold a license in more than one class of specified medical
22marijuana activities. A licensee shall not be an officer, director,
23member, owner, or shareholder in another entity licensed pursuant
24to this part. The officers, directors, owners, members, or
25shareholders of a licensee in one class may not hold a license in
26another class, and may not be an officer, director, member, owner,
27or shareholder of an entity licensed pursuant to this part.

end insert
28

18102.  

(a) Abegin delete licensed dispensingend delete facilitybegin insert licensed pursuant to
29this partend insert
shall not acquire,begin delete possess,end delete cultivate,begin insert process, possess,
30store, manufacture, test, distribute, sell,end insert
deliver, transfer, transport,
31or dispense marijuana for any purpose other than those authorized
32by Article 2.5 (commencing with Section 11362.7) of Chapter 6
33of Division 10 of the Health and Safety Code.

34(b) A licensed dispensing facility shall not acquirebegin insert, cultivate,
35process, possess, store, manufacture, test, distribute, sell, deliver,
36transfer, transport, or dispenseend insert
marijuana plants orbegin insert marijuanaend insert
37 products except throughbegin delete the cultivation of marijuana by that
38facility, if the facility isend delete
a licensed cultivation sitebegin delete,end delete orbegin delete another
39licensed cultivation siteend delete
begin insert processing facilityend insert.

begin insert
P11   1

begin insert18103.end insert  

(a) A licensed transporter shall ship only to facilities
2licensed pursuant to this part and only in response to a request
3for a specific quantity and variety from those facilities.

4(b) Prior to transporting any medical marijuana product, a
5licensed transporter shall do the following:

6(1) Complete a shipping manifest using a form prescribed by
7the department.

8(2) Securely transmit a copy of the manifest to the licensee that
9will receive the medical marijuana product, and to the department,
10prior to transport.

11(c) The licensed transporter making the shipment and the
12licensee receiving the shipment shall maintain each shipping
13manifest and make it available to local code enforcement officers,
14any other locally designated enforcement entity, and the
15department upon request.

end insert
begin insert
16

begin insert18104.end insert  

(a) Transported medical marijuana products shall:

17(1) Be transported only in a locked, safe and secure storage
18compartment that is securely affixed to the interior of the
19transporting vehicle.

20(2) Not be visible from outside the vehicle.

21(b) Any vehicle transporting medical marijuana products shall
22travel directly from one licensed facility to another licensed facility
23authorized to receive the shipment.

end insert
begin insert
24

begin insert18105.end insert  

(a) All transport vehicles shall be staffed with a
25minimum of two employees. At least one transport team member
26shall remain with the vehicle at all times that the vehicle contains
27medical marijuana.

28(b) Each transport team member shall have access to a secure
29form of communication by which each member can communicate
30with personnel at the licensed facility at all times that the vehicle
31contains medical marijuana.

32(c) Each transport team member shall possess documentation
33of licensing and a government-issued identification card at all
34times when transporting or delivering medical marijuana and shall
35produce it to any representative of the department or law
36enforcement official upon request.

37(d) This part shall not be construed to authorize or permit any
38licensee to transport, or cause to be transported, marijuana or
39marijuana products outside the state.

end insert
begin insert
P12   1

begin insert18106.end insert  

(a) The department shall have the authority, subject
2to local ordinances, to license persons for the cultivation,
3manufacture, testing, transportation, storage, and sale of medical
4marijuana within the state, and to levy appropriate related
5licensing fees not to exceed the reasonable costs of enforcement
6and administration of this part. The department shall not issue a
7license if the applicant has not met all requirements pursuant to
8Section 18101. A license, once issued, shall be suspended within
9five days of notification to the department by a local agency that
10a licensee is no longer in compliance with local ordinances or
11regulation.

12(b) The department shall promulgate, by July 1, 2016,
13regulations for implementation and enforcement of this part,
14including all of the following:

15(1) Procedures for the issuance, renewal, suspension, and
16revocation of licenses.

17(2) Application, licensing, and renewal forms and fees.

18(3) A time period in which the department shall approve or deny
19an application for a license to operate a facility or dispensary.

20(4) Qualifications for licensees.

21(5) Standards for certification of testing laboratories to perform
22random sample testing of all marijuana products intended for sale,
23to identify and eliminate chemical residue, microbiological
24contaminants, and mold.

25(c) The department shall promulgate, by July 1, 2016,
26regulations for minimum statewide health and safety standards
27and quality assurance standards pursuant to Section 111658 of
28the Health and Safety Code associated with the cultivation,
29transport, storage, and sale of all medical marijuana produced in
30this state. Local agencies shall have primary responsibility for
31enforcement of these standards in accordance with department
32regulations.

33(d) An application for or renewal of a license shall not be
34approved if the department determines any of the following:

35(1) The applicant fails to meet the requirements of this part or
36any regulation adopted pursuant to this part or any applicable
37city or county ordinance or regulation.

38(2) The applicant, or any of its officers, directors, owners,
39members, or shareholders is a minor.

P13   1(3) The applicant has knowingly answered a question or request
2for information falsely on the application form, or failed to provide
3information requested.

4(4) The applicant, or any of its officers, directors, owners,
5members, or shareholders has been sanctioned by the department,
6a city, county, or city and county, for marijuana activities
7conducted in violation of this part or any applicable local
8ordinance or has had a license revoked in the previous five years.

9(5) The proposed cultivation, processing, possession, storage,
10manufacturing, testing, transporting, distribution, provision, or
11sale of medical marijuana will violate any applicable local law
12or ordinance.

13(e) The department may consult with other state agencies, state
14departments, public entities, or private entities for the purposes
15of establishing statewide standards and regulations.

16(f) The department may assist state taxation authorities in the
17development of uniform policies for the state taxation of licensees.

18(g) The department may assist the Division of Occupational
19Safety and Health in the Department of Industrial Relations in the
20development of industry-specific regulations related to the activities
21of licensees.

end insert
22

begin delete18103.end delete
23begin insert18107.end insert  

(a) A person shall not distribute any form of advertising
24for physician recommendations for medical marijuana in California
25unless the advertisement bears the following notice to consumers:


27NOTICE TO CONSUMERS: The Compassionate Use Act of
281996 ensures that seriously ill Californians have the right to obtain
29and use marijuana for medical purposes where medical use is
30deemed appropriate and has been recommended by a physician
31who has determined that the person’s health would benefit from
32the use of marijuana. Physicians are licensed and regulated by the
33Medical Board of California and arrive at the decision to make
34this recommendation in accordance with accepted standards of
35medical responsibility.


37(b) Advertising for physician recommendations for medical
38marijuana shall meet all requirements of Section 651. Price
39advertising shall not be fraudulent, deceitful, or misleading,
P14   1including statements or advertisements of bait, discounts,
2premiums, gifts, or statements of a similar nature.

3

begin delete18104.end delete
4begin insert18108.end insert  

(a) A facility licensed pursuant to this part shall
5implement sufficient security measures to both deter and prevent
6unauthorized entrance into areas containing marijuana and theft
7of marijuana at those facilities. These security measures shall
8include, but not be limited to, all of the following:

9(1) Allow only qualifying patients, the patient’s primary
10caregiver, and facility agents access to the facility.

11(2) Prevent individuals from remaining on the premises of the
12facility if they are not engaging in activity expressly related to the
13operations of the facility.

14(3) Establish limited access areas accessible only to authorized
15facility personnel.

16(4) Store all finished marijuana in a secure, locked safe or vault
17and in a manner as to prevent diversion, theft, and loss.

18(b) A facility licensed pursuant to this part shall notify
19appropriate law enforcement authorities within 24 hours after
20discovering any of the following:

21(1) Discrepancies identified during inventory.

22(2) Diversion, theft, loss, or any criminal activity involving the
23facility or a facility agent.

24(3) The loss or unauthorized alteration of records related to
25marijuana, registered qualifying patients, personal caregivers, or
26facility agents.

27(4) Any other breach of security.

28(c) A licensed cultivation site shall weigh, inventory, and
29account for on video, all medical marijuana to be transported prior
30to its leaving its origination location. Within eight hours after
31arrival at the destination, the licensed dispensing facility shall
32reweigh, reinventory, and account for on video, all transported
33marijuana.

begin insert
34

begin insert18108.5.end insert  

(a) The department shall require an annual audit of
35all licensees licensed pursuant to this part or otherwise licensed
36by the department to cultivate, manufacture, process, test,
37transport, store, or sell marijuana to be paid for by each licensed
38vendor and dispensary.

39(b) Completed audit reports shall also be submitted by the
40licensee to local code enforcement offices, or the appropriate
P15   1locally designated enforcement entity, within 30 days of the
2completion of the audit.

3(c) It is the responsibility of each licensee licensed pursuant to
4this part or otherwise licensed by the department to cultivate,
5manufacture, process, test, transport, store, or sell marijuana to
6develop a robust quality assurance protocol that includes all of
7the provisions of this part.

end insert
8

begin delete18105.end delete
9begin insert18109.end insert  

In addition to the provisions of this part, a license
10granted pursuant to this part shall be subject to the restrictions of
11the local jurisdiction in which the facility operates or proposes to
12operate. Even if a license has been granted pursuant to this part, a
13facility shall not operate in a local jurisdiction that prohibits the
14establishment of that type of business.

15

begin delete18106.end delete
16begin insert18110.end insert  

Violation of this part shall be punishable by a civil fine
17of up to thirty-five thousand dollars ($35,000) for each individual
18violation.

19

begin delete18107.end delete
20begin insert18111.end insert  

Nothing in this part shall prevent a city or other local
21governing body from taking action as specified in Section 11362.83
22of the Health and Safety Code.

begin insert
23

begin insert18112.end insert  

This part shall in no way supersede the provisions of
24Measure D, approved by the voters of the City of Los Angeles on
25the May 21, 2013, ballot for the city, which granted marijuana
26businesses and dispensaries qualified immunity consistent with
27the terms of the measure and local ordinances. Notwithstanding
28the provisions of this part, marijuana businesses and dispensaries
29subject to the provisions of Measure D and its qualified immunity
30shall continue to be subject to the ordinances and regulations of
31the City of Los Angeles.

end insert
begin insert
32

begin insert18113.end insert  

(a) This part shall not apply to, and shall have no
33diminishing effect on, the rights and protections granted to a
34patient or a primary caregiver pursuant to the Compassionate Use
35Act of 1996.

36(b) (1) A patient who cultivates, possesses, stores, manufactures,
37or transports marijuana exclusively for his or her personal medical
38use and who does not sell, distribute, donate, or provide marijuana
39to any other person is not considered a licensee under this part
40and is exempt from licensure under this part.

P16   1(2) A primary caregiver who cultivates, possesses, stores,
2manufactures, transports, or provides marijuana exclusively for
3the personal medical purposes of a specified qualified patient for
4whom he or she is the primary caregiver within the meaning of
5Section 11362.7 of the Health and Safety Code and who does not
6receive remuneration for these activities except for compensation
7in full compliance with subdivision (c) of Section 11362.765 of the
8Health and Safety Code is not considered a licensee under this
9part and is exempt from licensure under this part.

end insert
10begin insert

begin insertSEC. 5.end insert  

end insert

begin insertArticle 8 (commencing with Section 111658) is added
11to Chapter 6 of Part 5 of Division 104 of the end insert
begin insertHealth and Safety
12Code
end insert
begin insert, to read:end insert

begin insert

13 

14Article begin insert8.end insert  Medical Marijuana
15

 

16

begin insert111658.end insert  

For purpose of this article, the following definitions
17shall apply:

18(a) “Certified testing laboratories” means a laboratory that is
19certified by the department to perform random sample testing of
20marijuana pursuant to the certification standards for those facilities
21promulgated by the department.

22(b) “Department” means the Department of Consumer Affairs.

23(c) “Edible marijuana product” means marijuana or a
24marijuana-derived product that is ingested or meant to be ingested
25through the mouth and into the digestive system.

26(d) “Marijuana” means marijuana, as defined by Section 11018.

27(e) “Representative samples” means samples taken from each
28batch or shipment of marijuana received from a licensed cultivation
29site or any other source if intended for sale.

30

begin insert111659.end insert  

The department, by July 1, 2016, shall accomplish the
31following:

32(a) Establish quality assurance protocols to ensure uniform
33testing standards for all marijuana sold via dispensaries or other
34facilities, or cultivated by any facilities, that are licensed pursuant
35to Part 5 (commencing with Section 18100) of Division 7 of the
36Business and Professions Code.

37(b) In consultation with outside entities at its discretion, develop
38a list of certified testing laboratories that can perform uniform
39testing in compliance with this article, and post that list on its
40Internet Web site.

P17   1

begin insert111660.end insert  

(a) Licensees licensed pursuant to Part 5
2(commencing with Section 18100) of Division 7 of the Business
3and Professions Code shall bear the responsibility for contracting
4with certified testing laboratories for regular, systematic testing
5of representative samples of all marijuana cultivated or intended
6for sale or distribution, and shall bear the cost of that testing.

7(b) Licensees licensed pursuant to Part 5 (commencing with
8Section 18100) of Division 7 of the Business and Professions Code
9shall provide results of test reports to local code enforcement
10officers, any other locally designated enforcement entity, and the
11department both on a quarterly basis and upon request.

12

begin insert111661.end insert  

Quality assurance protocols shall be required between
13all licensed cultivation sites or licensed processing facilities and
14licensed dispensing facilities to guarantee safe and reliable
15medicinal marijuana delivery to all patients. These quality
16assurance protocols shall include:

17(a) Providing of supplier information to dispensaries in order
18for recall procedures to be implemented, if and when necessary.

19(b) Safety testing of all marijuana prior to packaging for sale
20and patient exposure to identify and eliminate microbiological
21contaminants and chemical residue.

22(c) Labeling of all marijuana and marijuana products that shall,
23at a minimum, include the following:

24(1) Clear dosage in total milligrams delivered for all products.

25(2) Clear indication, in bold font, that the product contains
26marijuana.

27(3) Tetrahydrocannabinol (THC) and cannabidiol (CBD)
28content.

29

begin insert111662.end insert  

For purposes of this article, edible marijuana products
30are deemed to be unadulterated food products. In addition to the
31quality assurance standards provided in Section 111661, all edible
32marijuana products shall comply with the following requirements:

33(a) Baked edible marijuana products (such as brownies, bars,
34cookies, and cakes), tinctures, and other edible marijuana products
35that do not require refrigeration or hot-holding may be
36manufactured, sold, or otherwise distributed at facilities licensed
37pursuant to Part 5 (commencing with Section 18100) of Division
387 of the Business and Professions Code.

39(b) Licensed marijuana facilities shall have an owner or
40employee who has successfully passed an approved and accredited
P18   1food safety certification examination as specified in Sections
2113947.1, 113947.2, and 113947.3 of the Health and Safety Code
3prior to selling, manufacturing, or distributing edible marijuana
4products requiring refrigeration or hot-holding.

5(c) Individuals’ manufacturing or selling edible marijuana
6products shall thoroughly wash their hands before commencing
7production and before handling finished edible marijuana products.

8(d) All edible marijuana products shall be individually wrapped
9at the original point of preparation. All edible marijuana products
10shall be packaged in a fashion that does not exceed a single
11individual serving size.

12(e) Products containing tetrahydrocannabinol (THC) shall be
13prepared in compliance with maximum potency standards for THC
14and THC concentrates set forth in the department’s regulations.

15(f) Prior to sale or distribution at a licensed dispensing facility,
16edible marijuana products shall be labeled and in an opaque and
17tamper evident package. Labels and packages of edible marijuana
18products shall meet the following requirements:

19(1) Edible marijuana packages and labels shall not be made to
20be attractive to children.

21(2) All edible marijuana product labels shall include the
22following information, prominently displayed and in a clear and
23legible font:

24(A) Manufacture date.

25(B) The statement “KEEP OUT OF REACH OF CHILDREN.”

26(C) The statement “FOR MEDICAL USE ONLY.”

27(D) Net weight of marijuana in package.

28(E) A warning, if nuts or other known allergens are used, and
29shall include the total weight, in ounces or grams, of marijuana
30in the package.

31(F) Tetrahydrocannabinol (THC) and cannabidiol (CBD)
32content.

33(g) Photos or images of food are not allowed on edible
34marijuana product packages or labels.

35(h) Only generic food names may be used to describe edible
36marijuana products. For example, “snickerdoodle” may not be
37used to describe a cinnamon cookie.

end insert
38begin insert

begin insertSEC. 6.end insert  

end insert

begin insertChapter 3.8 (commencing with Section 7295) is added
39to Part 1.7 of Division 2 of the end insert
begin insertRevenue and Taxation Codeend insertbegin insert, to
40read:end insert

begin insert

 

P19   1Chapter  begin insert3.8.end insert Medical Marijuana
2

 

3

begin insert7295.end insert  

(a) In addition to any authority otherwise provided by
4law, the legislative body of any county may levy a tax on the
5privilege of cultivating, dispensing, producing, processing,
6preparing, storing, providing, or distributing marijuana or
7products containing marijuana.

8(b) The tax may be levied for general governmental purposes
9or for specific purposes specified by the legislative body.

10(c) The legislative body shall specify the activities subject to
11the tax, the applicable rate or rates, the method of apportionment,
12and manner of collection of the tax. A tax imposed pursuant to this
13section is a tax and not a fee or special assessment, and there is
14no requirement that the tax be apportioned on the basis of benefit
15to any property or be applied uniformly to all taxpayers or all real
16property. The tax imposed pursuant to this section may be based
17on any reasonable basis as determined by the legislative body.

18(d) In addition to any other method of collection authorized by
19law, the legislative body may provide for collection of the tax
20imposed pursuant to this section in the same manner, and subject
21to the same penalties and priority of lien as, other charges and
22taxes fixed and collected by the county.

23(e) The tax may be imposed upon any or all of the activities set
24forth in subdivision (a), regardless of whether the activity is
25undertaken individually, collectively, or cooperatively, and
26regardless of whether the activity is undertaken for compensation
27or without compensation or profit, as determined by the legislative
28body.

29(f) Any tax levied pursuant to this section shall be subject to
30any applicable voter approval requirement imposed by any other
31provision of law.

32(g) The tax, when levied by the legislative body of a county,
33shall apply throughout the entire county or within the
34unincorporated area of the county, as specified by the legislative
35body.

36(h) For purposes of this section, “marijuana” means marijuana,
37as defined by Section 11018 of the Health and Safety Code.

38(i) This section is declaratory of existing law, and does not limit
39or prohibit the levy or collection or any other fee, charge, or tax,
40or any license or service fee or charge upon, or related to, the
P20   1activities set forth in subdivision (a) as provided by other
2provisions of law.

end insert
3

begin deleteSEC. 4.end delete
4begin insertSEC. 7.end insert  

No reimbursement is required by this act pursuant to
5Section 6 of Article XIII B of the California Constitution because
6the only costs that may be incurred by a local agency or school
7district will be incurred because this act creates a new crime or
8infraction, eliminates a crime or infraction, or changes the penalty
9for a crime or infraction, within the meaning of Section 17556 of
10the Government Code, or changes the definition of a crime within
11the meaning of Section 6 of Article XIII B of the California
12Constitution.



O

    95