Amended in Assembly August 4, 2014

Amended in Assembly July 2, 2014

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

(Principal coauthor: Assembly Member Ammiano)

February 21, 2014


An act to amend Section 2220.05 of, to 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, to add Section 23028 to the Government Code,begin insert and to amend Section 11362.775 of,end insert and to add Article 8 (commencing with Section 111658) to Chapter 6 of Part 5 of Division 104begin delete ofend deletebegin insert of,end insert the Health and Safety Code, relating to medical marijuana, and making an appropriation therefor.

LEGISLATIVE COUNSEL’S DIGEST

SB 1262, as amended, Correa. Medicalbegin delete marijuana: regulation of physicians, dispensaries, cultivation sites, and processing facilities.end deletebegin insert marijuana.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 professions by the Department of Consumer Affairs. 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.

This bill would establish within the Department of Consumer Affairs a Bureau of Medical Marijuana Regulationbegin insert, under the supervision and control of the Chief of the Bureau of Medical Marijuana Regulation, as specified,end insert to license dispensing facilities, cultivation sites, andbegin delete processing facilitiesend deletebegin insert manufacturersend insert thatbegin insert, among other things,end insert provide, process, and growbegin insert medicalend insert marijuanabegin delete for medical useend delete, as specified, subject to local ordinancesbegin insert. The bill would require every city, county, or city and county that permits medical marijuana dispensing or cultivation to submit to the bureau a list of approved entities providing medical marijuana within that jurisdiction. The bill would require the bureau to adopt regulations for the implementation and enforcement of these provisions, specifically relating to procedures for licensing, fees for licenses, and sanitationend insert. The bill would require a background check of applicants for licensure to be administered by the Department of Justicebegin insert, and submission of a statement signed by an applicant, under penalty of perjury, that the information on his or her application is true, thereby creating a crime and imposing a state-mandated local programend insert. The bill would make these licenses subject to the restrictions of the local jurisdiction in which the facility operates or proposes to operate. The bill would, among other things, require licensees to implement sufficient security measures to both deter and prevent unauthorized entrance into areas containing marijuana and theft of marijuana at their facilities, including establishing limited access areas accessible only to authorized facility personnel, and would require these licensees to notify appropriate law enforcement authorities within 24 hours after discovering specified breaches in security. The bill would set forth provisions related to the transportation, testing, and distribution ofbegin insert medicalend insert marijuana. The bill would set forth provisions for the revocation or suspension of a license for a violation of these provisions or of local ordinancesbegin delete, and would require the bureau to make recommendations to the Legislature pertaining to the establishment of a judicial review processend delete. The 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. Violation of these provisions would be punishable by a civil fine of up to $35,000 for each individual violation, or as otherwise specified.

The bill would establish the Medical Marijuana Regulation Fund and would require the deposit of fees collected pursuant to this act into the fund. The bill would continuously appropriate moneys from the fund to the bureau for the purposes of administering this act, thereby making an appropriation. The bill would require the deposit of penalty moneys collected pursuant to this act into the General Fund.

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.

The bill wouldbegin delete require the bureauend deletebegin insert authorize a city, county, or city and countyend insert to administer and enforce these provisions. The bill would require the bureau 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 ediblebegin insert medicalend insert 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.

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

This bill would require the board to consult with the Center for Medicinal 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, the bill would impose a state-mandated local program.

The bill would provide that specified acts of recommending marijuanabegin insert for medical purposesend insert 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 physician and surgeon 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.

(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%.

This bill would authorize the board of supervisors of a county to impose a tax on the privilege of cultivating, dispensing, producing, processing, preparing, storing, providing, donating, selling, 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.

begin insert

(4) Existing law exempts qualified patients, persons with valid identification cards, and the designated primary caregivers of qualified patients and persons with identification cards from certain crimes, including possession of concentrated cannabis and marijuana, cultivation of marijuana, and possession of marijuana for sale.

end insert
begin insert

This bill would also exempt from those crimes an employee, officer, or board member of a licensed cultivation site or a licensed dispensing facility, except as specified.

end insert
begin delete

(4)

end delete

begin insert(5)end insert This bill would provide that its provisions are severable.

begin delete

(5)

end delete

begin insert(6)end insert Existing constitutional provisions require that a statute that limits the right of access to the meetings of public bodies or the writings of public officials and agencies be adopted with findings demonstrating the interest protected by the limitation and the need for protecting that interest.

This bill would make legislative findings to that effect.

begin delete

(6)

end delete

begin insert(7)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: yes. Fiscal committee: yes. State-mandated local program: yes.

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

P5    1

SECTION 1.  

The Legislature finds and declares all of the
2following:

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 by
10a 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.”

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, while ensuring that nothing in this act shall be construed
18to condone the diversion of marijuana for nonmedical purposes.

19(c) In 2003, the Legislature enacted the Medical Marijuana
20Program Act (MMPA), codified in Article 2.5 (commencing with
21Section 11362.7) of Chapter 6 of Division 10 of the Health and
22Safety Code.

23(d) Greater certainty and minimum statewide standards are
24urgently needed regarding the obligations of medical marijuana
25facilities, and for the imposition and enforcement of regulations
P6    1to prevent unlawful cultivation and the diversion of marijuana to
2nonmedical use.

3(e) Despite the passage of the Compassionate Use Act of 1996
4and the MMPA, because of the lack of an effective statewide
5system for regulating and controlling medical marijuana, cities,
6counties and local law enforcement officials have been confronted
7with uncertainty about the legality of some medical marijuana
8cultivation and distribution activities. The current state of affairs
9makes law enforcement difficult and endangers patient safety
10because of an inability to monitor the supply of medical marijuana
11in the state and the lack of quality control, testing, and labeling
12requirements.

13(f) The California Constitution grants cities and counties the
14authority to make and enforce, within their borders, “all local
15police, sanitary, and other ordinances and regulations not in conflict
16with the general laws.” This inherent local police power includes
17broad authority to determine, for purposes of public health, safety,
18and welfare, the appropriate uses of land within the local
19jurisdiction’s borders. The police power, therefore, allows each
20city and county to determine whether or not a medical marijuana
21dispensary or other facility that makes medical marijuana available
22may operate within its borders. This authority has been upheld by
23City of Riverside v. Inland Empire Patients Health & Wellness,
24Inc. (2013) 56 Cal.4th 729 and County of Los Angeles v. Hill
25(2011) 192 Cal.App.4th 861. Nothing in this act shall diminish,
26erode, or modify that authority.

27(g) If, pursuant to this authority, a city or county determines
28that a dispensary or other facility that makes medical marijuana
29available may operate within its borders, then there is a need for
30the state to license these dispensaries and other facilities for the
31purpose of adopting and enforcing protocols for training and
32certification of physicians who recommend the use of medical
33marijuana and for agricultural cultivation practices. This licensing
34requirement is not intended in any way nor shall it be construed
35to preempt local ordinances, regulations, or enforcement actions
36regarding the sale and use of medical marijuana, including, but
37not limited to, security, signage, lighting, and inspections.

38(h) All of the following elements are necessary to uphold
39important state goals:

P7    1(1) Strict provisions to prevent the potential diversion of
2marijuana for recreational use.

3(2) Audits to accurately track the volume of both product
4movement and sales.

5(3) An effective means of restricting nonmedical access to
6medical marijuana by minors.

begin insert

7(i) The public welfare and public safety require that there be a
8limitation on the number of premises licensed for the cultivation
9of marijuana to prevent the diversion of marijuana for nonmedical
10purposes.

end insert
begin delete

11(i)

end delete

12begin insert(j)end insert Nothing in this act shall be construed to promote or facilitate
13the nonmedical, recreational possession, sale, or use of marijuana.

14

SEC. 2.  

Section 2220.05 of the Business and Professions Code
15 is amended to read:

16

2220.05.  

(a) In order to ensure that its resources are maximized
17for the protection of the public, the Medical Board of California
18shall prioritize its investigative and prosecutorial resources to
19ensure that physicians and surgeons representing the greatest threat
20of harm are identified and disciplined expeditiously. Cases
21involving any of the following allegations shall be handled on a
22priority basis, as follows, with the highest priority being given to
23cases in the first paragraph:

24(1) Gross negligence, incompetence, or repeated negligent acts
25that involve death or serious bodily injury to one or more patients,
26such that the physician and surgeon represents a danger to the
27public.

28(2) Drug or alcohol abuse by a physician and surgeon involving
29death or serious bodily injury to a patient.

30(3) Repeated acts of clearly excessive prescribing, furnishing,
31or administering of controlled substances, or repeated acts of
32prescribing, dispensing, or furnishing of controlled substances, or
33recommending marijuana to patients for medical purposes, without
34a good faith prior examination of the patientbegin insert, including an
35examination in full compliance with the federal Health Insurance
36Portability and Accountability Act of 1996 (42 U.S.C. Sec. 1320d
37et seq.),end insert
and medical reason therefor. However, in no event shall
38a physician and surgeon prescribing, furnishing, or administering
39controlled substances for intractable pain consistent with lawful
40prescribing, including, but not limited to, Sections 725, 2241.5,
P8    1and 2241.6 of this code and Sections 11159.2 and 124961 of the
2Health and Safety Code, be prosecuted for excessive prescribing
3and prompt review of the applicability of these provisions shall
4be made in any complaint that may implicate these provisions.

5(4) Sexual misconduct with one or more patients during a course
6of treatment or an examination.

7(5) Practicing medicine while under the influence of drugs or
8alcohol.

9(b) The board may by regulation prioritize cases involving an
10allegation of conduct that is not described in subdivision (a). Those
11cases prioritized by regulation shall not be assigned a priority equal
12to or higher than the priorities established in subdivision (a).

13(c) The Medical Board of California shall indicate in its annual
14report mandated by Section 2312 the number of temporary
15restraining orders, interim suspension orders, and disciplinary
16actions that are taken in each priority category specified in
17subdivisions (a) and (b).

18

SEC. 3.  

Article 25 (commencing with Section 2525) is added
19to Chapter 5 of Division 2 of the Business and Professions Code,
20to read:

21 

22Article 25.  Recommending Medical Marijuana
23

 

24

2525.  

(a) It is unlawful for a physician and surgeon who
25recommends marijuana to a patient for a medical purpose to accept,
26solicit, or offer any form of remuneration from or to a facility
27licensed pursuant to Part 5 (commencing with Section 18100) of
28Division 7, if the physician and surgeon or his or her immediate
29family have a financial interest in that facility.

30(b) For the purposes of this section, “financial interest” shall
31have the same meaning as in Section 650.01.

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

33

2525.1.  

Thebegin delete boardend deletebegin insert Medical Board of Californiaend insert shall consult
34with the California Marijuana Research Program, known as the
35Center for Medicinal Cannabis Research, authorized pursuant to
36Section 11362.9 of the Health and Safety Code, on developing and
37adopting medical guidelines for the appropriate administration and
38use ofbegin insert medicalend insert marijuana.

39

2525.2.  

A physician and surgeon shall not recommend medical
40marijuana to a patient, unless that person is the patient’s attending
P9    1physician, as defined by subdivision (a) of Section 11362.7 of the
2Health and Safety Code.

3

SEC. 4.  

Part 5 (commencing with Section 18100) is added to
4Division 7 of the Business and Professions Code, to read:

5 

6PART 5.  Medical Marijuana

7

 

8

18100.  

For purposes of this part, the following definitions shall
9apply:

10(a) “Bureau” means the Bureau of Medical Marijuana Regulation
11in the Department of Consumer Affairs.

12(b) “Certified testing laboratory” means a laboratory that is
13certified by the bureau to perform random sample testing of
14begin insert medicalend insert marijuana pursuant to the certification standards for these
15facilities promulgated by the bureau.

begin insert

16(c) “Chief” means the Chief of the Bureau of Medical Marijuana
17Regulation.

end insert
begin insert

18(d) “Department” means the Department of Consumer Affairs.

end insert
begin insert

19(e) “Director” means the Director of Consumer Affairs.

end insert
begin delete

9 20(c)

end delete

21begin insert(f)end insert “Dispensary” means a distribution operation that provides
22begin insert medicalend insert marijuana orbegin insert medicalend insert marijuana derived productsbegin insert or
23devices for the use of medical marijuana or medical marijuana
24productsend insert
to patients.

begin delete

11 25(d)

end delete

26begin insert(g)end insert “Fund” means the Medical Marijuana Regulation Fund
27established pursuant to Sectionbegin delete 18101.4end deletebegin insert 18113end insert.

begin delete

13 28(e)

end delete

29begin insert(h)end insert “Licensed cultivation site” means a facility thatbegin insert plants,end insert
30 growsbegin insert, cultivates, harvests, dries, or processes medicalend insert marijuana
31begin delete for medical useend delete and that is licensed pursuant to this part.

begin delete

16 32(f)

end delete

33begin insert(i)end insert “Licensed dispensing facility” means a dispensary or other
34facility that providesbegin insert medicalend insert marijuanabegin delete for medical useend deletebegin insert, medical
35marijuana products, or devices for the use of medical marijuana
36or medical marijuana productsend insert
that is licensed pursuant to this
37part.

begin insert

38(j) “Licensed manufacturer” means a person who extracts,
39prepares, derives, produces, compounds, or repackages medical
P10   1marijuana or medical marijuana products into consumable and
2nonconsumable forms and that is licensed pursuant to this part.

end insert
begin delete

3(g) “Licensed processing facility” means a facility where
4marijuana or marijuana products are inspected, packaged, labeled,
5or otherwise prepared, warehoused, or stored prior to being
6provided to another facility licensed pursuant to this part, to a
7patient with a medical marijuana recommendation, or otherwise
8distributed, and that is licensed pursuant to this part.

end delete
begin delete

25 9(h)

end delete

10begin insert(k)end insert “Licensed transporter” means an individual or entity licensed
11by the bureau to transportbegin insert medicalend insert marijuana to and from facilities
12licensed pursuant to this part.

begin delete

28 13(i)

end delete

14begin insert(end insertbegin insertlend insertbegin insert)end insert “Marijuana” means all parts of the plant Cannabis sativa,
15cannabis indica, or cannabis ruderalis, whether growing or not;
16the seeds thereof; the resin, whether crude or purified, extracted
17from any part of the plant; and every compound, manufacture, salt,
18derivative, mixture, or preparation of the plant, its seeds, or resin.
19“Marijuana” does not include the mature stalks of the plant, fiber
20produced from the stalks, oil or cake made from the seeds of the
21plant, any other compound, manufacture, salt, derivative, mixture,
22or preparation of the mature stalks (except the resin extracted
23therefrom), fiber, oil, or cake, or the sterilized seed of the plant
24which is incapable of germination. “Marijuana” also means
25marijuana, as defined by Section 11018 of the Health and Safety
26Code.

begin delete
27

18101.  

(a) (1) There is hereby created in the Department of
28Consumer Affairs the Bureau of Medical Marijuana Regulation.
29The bureau shall be administered by an executive officer who shall
30be a civil servant appointed pursuant to civil service rules by the
31Governor, and who shall be known as the Executive Officer of the
32Bureau of Medical Marijuana Regulation.

33(2) Funds for the establishment and support of the bureau shall
34be advanced as a loan by the Department of Consumer Affairs and
35shall be repaid by the initial proceeds from fees collected pursuant
36to subdivision (b) of Section 18101.1, paragraph (9) of subdivision
37(f) of Section 18101.2, and subdivision (b) of Section 18101.3.

38(b) (1) The bureau shall have the power to license persons for
39the cultivation, manufacture, transportation, storage, distribution,
P11   1and sale of medical marijuana within the state and to collect
2licensing fees in connection with these actions.

3(2) The bureau shall exercise its authority pursuant to paragraph
4(1) consistent with subdivision (f) of Section 1 of the act that added
5this section and consistent with the provisions of this part.

6

18101.1.  

The bureau shall have the authority, subject to local
7ordinances, to license persons for the cultivation, manufacture,
8transportation, storage, and sale of medical marijuana within the
9state, and to levy appropriate related licensing fees not to exceed
10the reasonable costs of enforcement and administration of this part.
11The bureau shall not issue a license if the applicant has not met
12all requirements pursuant to this part. A license, once issued, shall
13be suspended within 10 days of notification to the bureau by a
14local agency that a licensee is no longer in compliance with any
15local ordinance or regulation. The bureau shall have the power
16necessary for the administration of this part, including, but not
17limited to, the following:

18(a) Establishing statewide minimum standards for the cultivation,
19manufacturing, transportation, storage, distribution, provision,
20donation, and sale of medical marijuana and medical marijuana
21products, and procedures for the issuance, renewal, suspension,
22and revocation of licenses.

23(b) Establishing a scale of application, license, and renewal fees,
24to be imposed by the state, for licenses for the cultivation,
25manufacturing, transportation, distribution, and sale of medical
26marijuana and medical marijuana products. The bureau may charge
27separate fees for each license application for cultivation,
28manufacturing, transportation, distribution, and sale. The total fees
29imposed pursuant to this part shall be based on the actual costs of
30administering and enforcing this part.

31(c) Making and proscribing any rule that may be necessary or
32proper to carry out the purposes and intent of this part and to enable
33it to exercise the powers and perform the duties conferred upon it
34by this part and in accordance with Chapter 3.5 (commencing with
35Section 11340) of Part 1 of Division 3 of Title 2 of the Government
36Code. For the performance of its duties, the bureau has the powers
37as set forth in Article 2 (commencing with Section 11180) of
38Chapter 2 of Part 1 of Division 3 of Title 2 of the Government
39Code.

P12   1(d) Approving or denying applications, subject to local
2ordinances, for cultivation, manufacturing, labeling, transportation,
3distribution, provision, donation, and sale of medical marijuana
4pursuant to this part.

5(e) The bureau shall, with input from local agencies, deny,
6suspend, or revoke any license issued pursuant to this part, or fine
7any licensee, if the bureau determines that the granting or
8continuance of the license would be contrary to public welfare or
9morals or that a person holding or seeking a license has violated
10any law prohibiting conduct involving moral turpitude or an
11applicable local ordinance.

12(f) Imposing any penalty authorized by this part or any rule or
13regulation adopted pursuant to this part.

14(g) Taking any action with respect to a license application in
15accordance with procedures established pursuant to this part.

16(h) The bureau shall make recommendations to the Legislature
17pertaining to the establishment of an appeals and judicial review
18process for persons aggrieved by a final decision of the bureau.

19(i) Developing any forms, identification certificates, and
20applications that are necessary or convenient in the discretion of
21the bureau for the administration of this part or any of the rules or
22regulations adopted pursuant to this part.

23(j) Overseeing the operation of the Medical Marijuana
24Regulation Fund established pursuant to Section 18101.4.

25(k) Establishing reasonable fees for processing all applications,
26licenses, notices, or reports required to be submitted to the bureau.
27The amount of the fees shall reflect, but shall not exceed, the direct
28and indirect costs of the bureau for the administration of this part
29and the rules or regulations adopted pursuant to this part.

30(l) The bureau may consult with other state agencies,
31departments, or public or private entities for the purposes of
32establishing statewide standards and regulations.

end delete
begin insert
33

begin insert18101.end insert  

The following persons are exempt from the requirement
34of licensure under this part:

35(a) A patient who cultivates, possesses, stores, manufactures,
36or transports marijuana exclusively for his or her personal medical
37use and who does not sell, distribute, donate, or provide marijuana
38to any other person or entity.

39(b) A primary caregiver who cultivates, possesses, stores,
40manufactures, transports, or provides marijuana exclusively for
P13   1the personal medical purposes to no more than five specified
2qualified patients for whom he or she is the primary caregiver
3within the meaning of Section 11362.7 of the Health and Safety
4Code and who does not receive remuneration for these activities,
5except for compensation in full compliance with subdivision (c)
6of Section 11362.765 of the Health and Safety Code. Nothing in
7this section shall permit primary caregivers to organize themselves
8as cooperatives or collectives of caregivers.

end insert
begin insert
9

begin insert18102.end insert  

(a) There is hereby created in the Department of
10Consumer Affairs the Bureau of Medical Marijuana Regulation,
11under the supervision and control of the Chief of the Bureau of
12Medical Marijuana Regulation.

13(b) Protection of the public shall be the highest priority for the
14bureau in exercising its licensing, regulatory, and disciplinary
15functions. Whenever the protection of the public is inconsistent
16with other interests sought to be promoted, the protection of the
17public shall be paramount.

18(c) The bureau shall have the authority to license persons for
19the cultivation, manufacture, transportation, storage, distribution,
20and sale of medical marijuana within the state and to collect
21 licensing fees in connection with these actions.

22(d) The Governor shall appoint the chief at a salary to be fixed
23and determined by the director with the approval of the Director
24of Finance. The chief shall serve in accordance with the State Civil
25Service Act (Part 2 (commencing with Section 18500) of Division
265 of Title 2 of the Government Code).

27(e) The duty of enforcing and administering this part shall be
28vested in the chief, who is responsible to the director. The chief
29may adopt and enforce those rules and regulations that he or she
30determines are reasonably necessary to carry out the purposes of
31this part and declaring the policy of the bureau, including a system
32for the issuance of citations for violations of this part as specified
33in Section 125.9.

34(f) The chief, as necessary to carry out the provisions of this
35part, and in accordance with the State Civil Service Act (Part 2
36(commencing with Section 18500) of Division 5 of Title 2 of the
37Government Code), may appoint and fix the compensation of
38personnel, including, but not limited to, clerical, inspection,
39investigation, and auditing personnel, as well as an assistant chief.
P14   1These personnel shall perform their respective duties under the
2supervision and the direction of the chief.

3(g) Every power granted to, or duty imposed upon, the chief
4under this part may be exercised or performed in the name of the
5chief by a deputy or assistant chief, subject to conditions and
6limitations that the chief may prescribe.

7(h) The bureau shall exercise its authority pursuant to this part
8consistent with Section 1 of the act that added this section and
9consistent with the provisions of this part.

end insert
begin insert
10

begin insert18103.end insert  

Funds for the establishment and support of the bureau
11shall be advanced as a loan by the department and shall be repaid
12by the initial proceeds from fees collected pursuant to this part or
13any rule or regulation adopted pursuant to this part.

end insert
begin insert
14

begin insert18104.end insert  

The bureau shall have the authority necessary for the
15implementation of this part, including, but not limited to, all of the
16following:

17(a) Establishing any rule or regulation that is necessary or
18proper to carry out the purposes and intent of this part and to
19enable the bureau to exercise the powers and perform the duties
20conferred upon it by this part and in accordance with Chapter 3.5
21(commencing with Section 11340) of Part 1 of Division 3 of Title
222 of the Government Code. For the performance of its duties, the
23bureau has the powers as set forth in Article 2 (commencing with
24Section 11180) of Chapter 2 of Part 1 of Division 3 of Title 2 of
25the Government Code.

26(b) Licensing persons for the cultivation, manufacture,
27transportation, storage, distribution, and sale of medical marijuana
28within the state.

29(c) Setting application, licensing, and renewal fees for licenses
30issued pursuant to this part. Fees may be scaled and shall be in
31an amount determined by the department sufficient to cover the
32reasonable regulatory costs of enforcing and administering this
33part.

34(d) Establishing standards for the cultivation, manufacturing,
35transportation, storage, distribution, provision, donation, and sale
36of medical marijuana and medical marijuana products.

37(e) Establishing procedures for the issuance, renewal,
38suspension, denial, and revocation of licenses.

39(f) Imposing a penalty authorized by this part or any rule or
40regulation adopted pursuant to this part.

P15   1(g) Taking action with respect to a license application in
2accordance with procedures established pursuant to this part.

3(h) Overseeing the operation of the Medical Marijuana
4Regulation Fund established pursuant to Section 18113.

5(i) Consulting with other state agencies, departments, or public
6or private entities for the purposes of establishing statewide
7standards and regulations.

end insert
begin insert
8

begin insert18105.end insert  

(a) On or before July 1, 2016, the bureau shall
9promulgate regulations for implementation and enforcement of
10this part, including, but not limited to, all of the following:

11(1) Procedures for the issuance, renewal, suspension, denial,
12and revocation of licenses.

13(2) Application, licensing, and renewal forms and fees.

14(3) A time period in which the bureau shall approve or deny an
15application for a license to operate pursuant to this part.

16(4) Qualifications for licensees.

17(5) Standards for certification of testing laboratories to perform
18random sample testing of all medical marijuana products,
19including standards for onsite testing.

20(A) Certification of testing laboratories shall be consistent with
21general requirements for the competence of testing and calibration
22activities, including sampling, using standard methods established
23by the International Organization for Standardization, specifically
24ISO/IEC 17025.

25(B) These requirements shall apply to all entities, including
26third-party laboratories, engaged in the testing of medical
27marijuana pursuant to this part.

28(6) Requirements to ensure conformance with standards
29analogous to state statutory environmental, agricultural, consumer
30protection, and food and product safety requirements. At a
31minimum, these standards shall do all of the following:

32(A) Prescribe sanitation standards analogous to the California
33Retail Food Code (Part 7 (commencing with Section 113700) of
34Division 104 of the Health and Safety Code) for food preparation,
35storage, handling, and sale of edible medical marijuana products.

36(B) Require that edible medical marijuana products produced,
37distributed, provided, donated, or sold by licensees shall be limited
38to nonpotentially hazardous food, as established by the State
39Department of Public Health pursuant to Section 114365.5 of the
40Health and Safety Code.

P16   1(C) Provide standards for labeling edible medical marijuana
2products to ensure that the products cannot be mistaken for food
3not containing marijuana.

4(D) Require that facilities in which edible medical marijuana
5products are prepared shall be constructed in accordance with
6applicable building standards, health and safety standards, and
7other state laws.

8(E) Provide that weighing or measuring devices used in
9connection with the sale or distribution of medical marijuana are
10required to meet standards analogous to Division 5 (commencing
11with Section 12001).

12(F) Require that the application of pesticides or other pest
13control in connection with the indoor or outdoor cultivation of
14medical marijuana shall meet standards analogous to Division 6
15(commencing with Section 11401) of the Food and Agricultural
16Code and its implementing regulations.

17(b) On or before July 1, 2016, the bureau shall also promulgate
18regulations for minimum statewide health and safety standards
19and quality assurance standards associated with the cultivation,
20transport, storage, manufacture, and sale of all medical marijuana
21produced in this state. Local agencies shall have primary
22responsibility for enforcement of these standards in accordance
23with bureau regulations.

end insert
24

begin delete18101.2.end delete
25begin insert18106.end insert  

(a) Except as provided in Section 11362.5 of, and
26Article 2.5 (commencing with Section 11362.7) of Chapter 6 of
27Division 10 of, the Health and Safety Code, a person shall not sell
28or providebegin insert medicalend insert marijuana other than at a licensed dispensing
29facility.

30(b) Except as provided in Section 11362.5 of, and Article 2.5
31(commencing with Section 11362.7) of Chapter 6 of Division 10
32of, the Health and Safety Code, a person shall not growbegin insert medicalend insert
33 marijuana other than at a licensed cultivation site.

34(c) Except as provided in Section 11362.5 of, and Article 2.5
35(commencing with Section 11362.7) of Chapter 6 of Division 10
36of, the Health and Safety Code, a person shall notbegin delete processend delete
37begin insert manufacture medicalend insert marijuanabegin insert or medical marijuana productsend insert
38 other thanbegin delete at a licensed processing facilityend deletebegin insert a licensed manufacturerend insert.

P17   1(d) A person shall not transportbegin insert medicalend insert marijuana from one
2facility licensed pursuant to this part to another, other than a
3licensed transporter.

begin insert

4(e) A licensed manufacturer may obtain medical cannabis from
5a licensed cultivator and may furnish medical cannabis products
6to a licensed dispensary.

end insert
begin delete

10 7(e)

end delete

8begin insert(f)end insert To meet the requirements of Article 8 (commencing with
9Section 111658) of Chapter 6 of Part 5 of Division 104 of the
10Health and Safety Code,begin insert medicalend insert marijuana andbegin insert medicalend insert marijuana
11products shall be tested by a certified testing laboratory.

begin delete

12(f) The bureau shall require, prior to issuing a license pursuant
13to this part, all of the following:

14(1) The name of the owner or owners of a proposed facility,
15including all persons or entities having an ownership interest other
16than a security interest, lien, or encumbrance on any property that
17will be used by the applicant.

18(2) The name, address, and date of birth of each principal officer
19and board member.

20(3) The address and telephone number of the proposed facility.

21(4) A description of the scope of business of the proposed
22facility.

23(5) A certified copy of the local jurisdiction’s approval to operate
24within its borders.

25(6) Operating and inventory control procedures to ensure
26security and prevent diversion.

27(7) Detailed operating procedures for the proposed facility,
28which shall include, but not be limited to, provisions for facility
29and operational security, prevention of diversion, employee
30screening, storage of medical marijuana, personnel policies, and
31recordkeeping procedures.

32(8) A completed application, as required by the bureau.

33(9) Payment of a fee, in an amount to be determined by the
34bureau, not to exceed the amount necessary, but that is sufficient
35to cover, the actual costs of the administration of this part.

36(10) (A) An applicant’s fingerprint images and related
37information required by the Department of Justice for the purpose
38of obtaining information as to the existence and content of a record
39of state and federal convictions and arrests, and information as to
40the existence and content of a record of state and federal
P18   1convictions and arrests for which the Department of Justice
2establishes that the person is free on bail, or on his or her own
3recognizance, pending trial or appeal.

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

7(11) In the case of a cultivation site, the GPS coordinates of the
8site.

9(12) Any other information as required by the bureau.

10(13) The bureau shall deny a license based on a past felony
11criminal conviction for drug trafficking, a felony conviction for
12embezzlement, a felony conviction involving fraud or deceit, or
13any violent or serious felony conviction pursuant to subdivision
14(c) of Section 667.5 of, or subdivision (c) of Section 1192.7 of,
15the Penal Code. The bureau may also deny a license based on a
16past criminal conviction if the crime was substantially related to
17the qualifications, functions, or duties of the business for which
18the license will be issued.

19(g) The bureau shall deny a license if the application fails to
20state with sufficient specificity the jurisdiction in which the
21applicant proposes to establish operations.

22(h) (1) Each application for a license approved by the bureau
23pursuant to this part is separate and distinct, and the bureau may
24charge a separate fee for each. A licensee shall not hold a license
25in more than one class of specified medical marijuana activities,
26except that a licensee may have a transporter license in addition
27to a license to cultivate, process, or dispense medical marijuana.

28 (2) A licensee shall not be an officer, director, member, owner,
29or shareholder in another entity licensed pursuant to this part. The
30officers, directors, owners, members, or shareholders of a licensee
31in one class of license may not hold a license in another class, and
32may not be an officer, director, member, owner, or shareholder of
33an entity licensed pursuant to this part.

end delete
34

begin delete18101.3.end delete
35begin insert18107.end insert  

Beginning January 1, 2015, the bureau shall provide
36for provisional licenses, as follows:

37(a) begin deleteThe bureau shall request that every end deletebegin insertEvery end insertcity, county, or
38city and countybegin delete provideend deletebegin insert that permits activities licensed under this
39part shall submit toend insert
the bureaubegin delete withend delete a list of approved entities
40providing medical marijuana to qualified patients and caregivers
P19   1within the city’s, county’s, or city and county’s jurisdiction, if any,
2the location at which the entity is operating, and the names of the
3persons who operate the entity.

4(1) If the jurisdiction represents that the entity has been operating
5in compliance with local laws and regulations, or has limited
6immunity under local laws, including, but not limited to, Measure
7D, approved by the voters of the City of Los Angeles at the May
821, 2013, general election, the bureau shall issue a provisional
9license to the entity until the time that the entity’s application for
10a license has been approved or denied under this part, but no later
11than 90 days after the bureau begins accepting applications for
12 licenses.

13(2) The bureaubegin delete shallend deletebegin insert mayend insert consult with relevant local agencies
14in making a determination on whether a provisional license
15applicant is in compliance with any applicable ordinance. The
16bureaubegin delete shallend deletebegin insert mayend insert issue a provisional license to an individual or
17entity once the bureau has obtained confirmation from the relevant
18local agency that the six months prior to January 1, 2015, the
19applicant was regularly cultivating or distributing medical
20marijuana collectively or cooperatively in full compliance with
21any applicable local ordinance. The bureau shall continue to issue
22provisional licenses until such time as the licensee’s application
23for a standard license has been approved or denied under this part,
24but no later than 90 days after the bureau begins accepting
25applications.begin delete To qualify for a provisional license, an applicant shall
26be required to disclose to the bureau the following information in
27writing on or before January 20, 2015, in order to obtain
28provisional licensure:end delete

begin delete

29(A) The names, addresses, and dates of birth of each principal
30officer, owner, or board member.

end delete
begin delete

31(B) The common street address and assessor’s parcel number
32of the property at which the applicant will conduct any activity
33under the authority of the license.

end delete
begin delete

34(C) The common street address and assessor’s parcel number
35of the property at which any cultivation activity was or is to be
36conducted.

end delete
begin delete

37(D) For the six months prior to January 1, 2015, the quantity of
38medical marijuana cultivated at a location and the quantity expected
39to be cultivated from January 1, 2015, to June 30, 2015, inclusive.
40The applicant shall make its records of current activity and activity
P20   1for the six months prior to January 1, 2015, available to the bureau
2upon request.

end delete
begin delete

3(b) The bureau shall charge an application fee of eight thousand
4dollars ($8,000) for each provisional license.

end delete
begin insert

5(b) An applicant for provisional licensure shall do all of the
6following:

end insert
begin insert

7(1) Pay a fee not to exceed eight thousand dollars ($8,000) or
8an amount determined by the bureau to cover the reasonable
9regulatory costs of enforcing and administering this section.

end insert
begin insert

10(2) Provide, in writing, the following information:

end insert
begin insert

11(A) The names, addresses, and dates of birth of each principal
12officer, owner, or board member.

end insert
begin insert

13(B) The common street address and assessor’s parcel number
14of the property at which the applicant will conduct any activity
15under the authority of the license.

end insert
begin insert

16(C) The common street address and assessor’s parcel number
17of the property at which any cultivation activity was or is to be
18conducted.

end insert
begin insert

19(D) The quantity of medical marijuana cultivated at a location
20from July 1, 2014, to January 1, 2015, inclusive, and the quantity
21expected to be cultivated from January 1, 2015, to June 30, 2015,
22inclusive. The applicant shall make its records of current activity
23and activity for the period from July 1, 2014, to January 1, 2015,
24inclusive, available to the bureau upon request.

end insert
begin insert

25(c) Upon receipt of the application materials and fee required
26in subdivision (b), the bureau may issue a provisional license and
27send a proof of issuance to the applicant, provided the applicant
28has not committed any act or crime constituting grounds for the
29denial of licensure under Section 18110.

end insert
begin delete

5 30(c)

end delete

31begin insert(d)end insert Notwithstanding any other provision of this section, the
32bureau shall not issue a provisional license tobegin delete anyend deletebegin insert anend insert individual
33or entity, or forbegin delete anyend deletebegin insert aend insert premises, against whom there are pending
34state or local administrative or judicial proceedings or actions
35initiated by a city, county, or city and county under any applicable
36local ordinance or who has been determined through those
37proceedings to have violated any applicable local ordinancebegin insert, or
38that knowingly provides false or fraudulent information on an
39application for licensureend insert
.

begin insert

P21   1(e) Once the bureau begins issuing provisional licenses, a
2dispensary, in order to benefit from the limited immunities provided
3in Section 11362.775 of the Health and Safety Code, may only
4provide patients medical marijuana and medical marijuana
5products obtained from provisionally licensed entities.

end insert
begin insert

6(f) Provisional licensees shall record each shipment of medical
7marijuana by weight and destination, and shall comply with state
8and federal rules and regulations regarding reporting and taxation
9of income received.

end insert
begin delete
10

18101.35.  

Beginning July 1, 2016, the bureau shall provide
11for standard licenses as follows:

12(a) The bureau shall request that every city, county, or city and
13county provide the bureau with a list of approved entities providing
14medical marijuana to qualified patients and caregivers within the
15city’s, county’s, or city and county’s jurisdiction, if any, the
16location at which the entity is operating, and the names of the
17persons who operate the entity.

18(b) If the jurisdiction represents that the entity has been operating
19in compliance with local laws and regulations, or has limited
20immunity under local laws, including, but not limited to, Measure
21D, approved by the voters of the City of Los Angeles at the May
2221, 2013, general election, the bureau shall issue a license to the
23entity if it meets the licensing requirements of this part.

24(c) The bureau shall consult with relevant local agencies in
25making a determination as to whether a standard license applicant
26is in compliance with local ordinances. The bureau shall issue a
27standard license only after it has obtained confirmation from the
28relevant local agency that the applicant has satisfied all local
29permitting requirements for cultivating or distributing medical
30marijuana in compliance with local ordinances, and fulfilled all
31other requirements under this part.

32(d) The bureau shall charge an application fee of eight thousand
33dollars ($8,000) for each standard license.

end delete
begin insert
34

begin insert18108.end insert  

(a) Beginning January 1, 2016, the bureau shall
35provide for standard licenses.

36(b) An applicant for licensure pursuant to this part shall do all
37following:

38(1) Pay the fee or fees required by this part for each license
39being applied for.

P22   1(2) Register with the bureau on forms prescribed by the chief.
2The forms shall contain sufficient information to identify the
3licensee, including all of the following:

4(A) Name of the owner or owners of a proposed facility,
5including all persons or entities having an ownership interest other
6than a security interest, lien, or encumbrance on any property that
7will be used by the applicant.

8(B) The name, address, and date of birth of each principal
9officer and board member.

10(C) The address and telephone number of the proposed facility.

11(D) In the case of a cultivation site, the GPS coordinates of the
12site.

13(3) Describe, in writing, the scope of business of the proposed
14facility.

15(4) A certified copy of the local jurisdiction’s approval to
16operate within its borders.

17(5) Detailed operating procedures, in writing, for the proposed
18facility, which shall include, but not be limited to, procedures for
19facility and operational security, prevention of diversion, employee
20screening, storage of medical marijuana, personnel policies, and
21recordkeeping procedures.

22(6) An applicant’s fingerprint images.

23(A) The bureau shall electronically submit to the Department
24of Justice fingerprint images and related information required by
25the Department of Justice of all licensed cultivation site applicants,
26licensed dispensing facility applications, manufacturing applicants,
27or transport applicants, as defined in Section 18100, for the
28purpose of obtaining information as to the existence and content
29of a record of state or federal convictions and arrests, and
30information as to the existence and content of a record of state or
31federal convictions and arrests for which the Department of Justice
32establishes that the person is free on bail, or on his or her own
33recognizance, pending trial or appeal.

34(B) The Department of Justice shall provide a response to the
35department pursuant to paragraph (1) of subdivision (p) of Section
3611105 of the Penal Code.

37(C) The bureau shall request from the Department of Justice
38subsequent notification service, as provided pursuant to Section
3911105.2 of the Penal Code, for persons described in subparagraph
40(A).

P23   1(D) The Department of Justice shall charge a fee sufficient to
2cover the reasonable cost of processing the requests described in
3this paragraph.

4(7) A statement signed by the applicant under penalty of perjury
5that the information provided is true.

6(8) Any other information as required by the bureau.

7(c) Every city, county, or city and county that permits activities
8licensed under this part shall submit to the bureau a list of
9approved entities providing medical marijuana to qualified patients
10and caregivers within the city’s, county’s, or city and county’s
11jurisdiction, if any, the location at which the entity is operating,
12and the names of the persons who operate the entity.

13(d) If the jurisdiction represents that the entity has been
14operating in compliance with local laws and regulations, or has
15limited immunity under local laws, including, but not limited to,
16Measure D, approved by the voters of the City of Los Angeles at
17the May 21, 2013, general election, the bureau may issue a license
18to the entity if it meets the licensing requirements of this part.

19(e) The bureau may consult with relevant local agencies in
20 making a determination as to whether a standard license applicant
21is in compliance with local ordinances. The bureau may issue a
22standard license only after it has obtained confirmation from the
23relevant local agency that the applicant has satisfied all local
24permitting requirements for cultivating or distributing medical
25marijuana in compliance with local ordinances, and fulfilled all
26other requirements under this part.

27(f) Each application for a license approved by the bureau
28pursuant to this part is separate and distinct, and the bureau may
29charge a separate fee for each.

30(g) A licensee shall not hold a license in more than one class
31of specified medical marijuana activities, except as follows:

32(1) A licensee may have a transporter license in addition to a
33license to cultivate, dispense, or manufacture medical marijuana
34or medical marijuana products.

35(2) A licensed dispensary may obtain a license to cultivate in a
36space not to exceed 1,000 square feet.

37(h) A licensee shall not be an officer, director, member, owner,
38or shareholder in another entity licensed pursuant to this part.
39The officers, directors, owners, members, or shareholders of a
40licensee in one class of license may not hold a license in another
P24   1class, and may not be an officer, director, member, owner, or
2shareholder of an entity licensed pursuant to this part.

end insert
begin insert
3

begin insert18109.end insert  

(a) Upon receipt of the application materials and fee
4required in Section 18108, the bureau may, provided the applicant
5has not committed any act or crime constituting grounds for the
6denial of licensure under Section 18110, issue the license and send
7a proof of issuance to the applicant.

8(b) The chief shall, by regulation, prescribe conditions upon
9which a person whose license has previously been denied,
10suspended, or revoked, may be issued a license.

end insert
begin insert
11

begin insert18110.end insert  

(a) An application for licensure may be denied and a
12license may be suspended or revoked on any of the following
13grounds:

14(1) The granting or continuance of the license would be contrary
15to the public welfare or morals.

16(2) A person holding or seeking a license has violated any law
17prohibiting conduct involving moral turpitude.

18(3) Past felony criminal conviction for drug trafficking, a felony
19conviction for embezzlement, a felony conviction involving fraud
20or deceit, or any violent or serious felony conviction pursuant to
21subdivision (c) of Section 667.5 of, or subdivision (c) of Section
221192.7 of, the Penal Code.

23(4) A city, county, or city and county notifies the bureau that a
24licensee or applicant for licensure within their jurisdiction is in
25violation of local ordinances or is otherwise not authorized to
26conduct the activities associated with licensure pursuant to this
27part.

28(5) The application fails to state with sufficient specificity the
29jurisdiction in which the applicant proposes to establish operations.

30(b) The chief, upon his or her determination, may deny, suspend,
31or revoke a license issued pursuant to this part for any of the
32following acts or omissions that are done by a licensee, applicant,
33or employee, partner, officer, or member of an entity licensed
34pursuant to this part:

35(1) Making or authorizing in any manner or by any means
36whatever a written or oral statement that is untrue or misleading,
37and that is known, or that by exercise of reasonable care should
38be known, to be untrue or misleading.

39(2) Any other conduct that constitutes fraud.

40(3) Conduct constituting gross negligence.

P25   1(4) Failure to comply with the provisions of this part, Article 8
2(commencing with Section 111658) of Chapter 6 of Part 5 of
3Division 104 of the Health and Safety Code, or any rule or
4regulation adopted pursuant to this part.

5(5) Conduct that constitutes grounds for denial of licensure
6pursuant to Chapter 2 (commencing with Section 480) of Division
71.5.

end insert
begin insert
8

begin insert18111.end insert  

(a) Upon denying, suspending, or revoking a
9provisional or standard license issued pursuant to this part, the
10chief shall notify the applicant or licensee, in writing, by personal
11service or mail addressed to the address of the applicant or
12licensee set forth in the application. The applicant or licensee shall
13be given a hearing within 30 days thereafter if he or she files with
14the bureau a written request for hearing. Otherwise, the denial,
15suspension, or revocation is deemed affirmed.

16(b) All proceedings to deny, suspend, or revoke a license shall
17be conducted pursuant to Chapter 5 (commencing with Section
1811500) of Part 1 of Division 3 of Title 2 of the Government Code.

end insert
begin insert
19

begin insert18112.end insert  

A state agency is not authorized or required by this
20section to enforce a city, county, city and county, or local law,
21ordinance, rule, or regulation regarding the site or operation of
22a licensee licensed pursuant to this part.

end insert
23

begin delete18101.4.end delete
24begin insert18113.end insert  

(a) The Medical Marijuana Regulation Fund is hereby
25established within the State Treasury. Notwithstanding Section
2616305.7 of the Government Code, the fund shall include any
27interest and dividends earned on the money in the fund.

28(b) All fees collected pursuant to this part shall be deposited
29into the Medical Marijuana Regulation Fund. Notwithstanding
30Section 13340 of the Government Code, all moneys within the
31fund are hereby continuously appropriated, without regard to fiscal
32year, to the bureau solely for the purposes of fully funding and
33 administering this part, including, but not limited to, the costs
34incurred by the bureau for its administrative expenses.

35(c) All moneys collected pursuant to this part as a result of
36penalties imposed under this part shall be deposited directly into
37the General Fund, to be available upon appropriation.

38(d) The bureau may establish and administer a grant program
39to allocate moneys from the Medical Marijuana Regulation Fund
40to state and local entities for the purpose of assisting with medical
P26   1marijuana regulation and the enforcement of this part and other
2state and local laws applicable to licensees.

3

begin delete18102.end delete
4begin insert18114.end insert  

(a) A facility licensed pursuant to this part shall not
5acquire, cultivate, process, possess, store, manufacture, distribute,
6sell, deliver, transfer, transport, or dispensebegin insert medicalend insert marijuana for
7any purpose other than those authorized by Article 2.5
8(commencing with Section 11362.7) of Chapter 6 of Division 10
9of the Health and Safety Code.

10(b) A licensed dispensing facility shall not acquire, cultivate,
11process, possess, store, manufacture, distribute, sell, deliver,
12transfer, transport, or dispensebegin insert medicalend insert marijuana plants orbegin insert medicalend insert
13 marijuana products except through a licensed cultivation site or
14begin delete processing facilityend deletebegin insert a licensed manufacturerend insert.

15

begin delete18103.end delete
16begin insert18115.end insert  

(a) A licensed transporter shall ship only to facilities
17licensed pursuant to this part and only in response to a request for
18a specific quantity and variety from those facilities.

19(b) Prior to transporting any medical marijuana product, a
20licensed transporter shall do the following:

21(1) Complete a shipping manifest using a form prescribed by
22the bureau.

23(2) Securely transmit a copy of the manifest to the licensee that
24 will receive the medical marijuana product, and to the bureau,
25prior to transport.

26(c) The licensed transporter making the shipment and the
27licensee receiving the shipment shall maintain each shipping
28manifest and make it available to local code enforcement officers,
29any other locally designated enforcement entity, and the bureau
30upon request.

31

begin delete18104.end delete
32begin insert18116.end insert  

(a) Transported medical marijuana products shall:

33(1) Be transported only in a locked, safe and secure storage
34compartment that is securely affixed to the interior of the
35transporting vehicle.

36(2) Not be visible from outside the vehicle.

37(b) Any vehicle transporting medical marijuana products shall
38travel directly from one licensed facility to another licensed facility
39authorized to receive the shipment.

P27   1

begin delete18105.end delete
2begin insert18117.end insert  

(a) All transport vehicles shall be staffed with a
3minimum of two employees. At least one transport team member
4shall remain with the vehicle at all times that the vehicle contains
5medical marijuana.

6(b) Each transport team member shall have access to a secure
7form of communication by which each member can communicate
8with personnel at the licensed facility at all times that the vehicle
9contains medical marijuana.

10(c) Each transport team member shall possess documentation
11of licensing and a government-issued identification card at all
12times when transporting or delivering medical marijuana and shall
13produce it to any representative of the department or law
14enforcement official upon request.

15(d) This part shall not be construed to authorize or permit any
16licensee to transport, or cause to be transported,begin insert medicalend insert marijuana
17orbegin insert medicalend insert marijuana products outside the state.

18

begin delete18105.5.end delete
19begin insert18118.end insert  

A local jurisdiction shall not prevent transportation
20begin delete through or to a licensed entity by a licensed transporter who acts
21in compliance with this partend delete
begin insert into, out of, or through its boundaries,
22or to a licensed entity, by a licensed transporter who acts in
23compliance with this partend insert
.

begin delete
24

18106.  

(a) The bureau shall promulgate, by July 1, 2016,
25regulations for implementation and enforcement of this part,
26including all of the following:

27(1) Procedures for the issuance, renewal, suspension, and
28revocation of licenses.

29(2) Application, licensing, and renewal forms and fees.

30(3) A time period in which the bureau shall approve or deny an
31application for a license to operate a facility or dispensary.

32(4) Qualifications for licensees.

33(5) Standards for certification of testing laboratories to perform
34random sample testing of all marijuana products intended for sale,
35to identify and eliminate chemical residue, microbiological
36contaminants, and mold.

37(6) Requirements to ensure conformance with standards
38analogous to state statutory environmental, agricultural, consumer
39protection, and food and product safety requirements. At a
40minimum, these standards shall do all of the following:

P28   1(A) Prescribe sanitation standards analogous to the California
2Retail Food Code (Part 7 (commencing with Section 113700) of
3Division 104 of the Health and Safety Code) for food preparation,
4storage, and handling and sale of edible marijuana products.

5(B) Require that edible marijuana products produced, distributed,
6provided, donated, or sold by licensees shall be limited to
7nonpotentially hazardous food as established by the State
8Department of Public Health pursuant to Section 114365.5 of
9Health and Safety Code.

10(C) Provide standards for labeling edible marijuana products to
11ensure that the products cannot be mistaken as food not containing
12marijuana.

13(D) Require that facilities in which edible marijuana products
14are prepared shall be constructed in accordance with applicable
15building standards, health and safety standards, and other state
16laws.

17(E) Provide that any weighing or measuring devices used in
18connection with the sale or distribution of marijuana are required
19to meet standards analogous to Division 5 (commencing with
20Section 12001).

21(F) Require that any application of pesticides or other pest
22control in connection with the indoor or outdoor cultivation of
23marijuana shall meet standards analogous to Division 6
24(commencing with Section 11401) of the Food and Agricultural
25Code and its implementing regulations.

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

33(c) An application for or renewal of a license shall not be
34approved if the bureau 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 city
37county, or city and county ordinance or regulation.

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

P29   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 bureau, a
6city, county, or city and county, for marijuana activities conducted
7in violation of this part or any applicable local ordinance or has
8had 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 or
12ordinance.

13(6) (A) The bureau shall deny an application for a license if
14issuance of that license would tend to create a law enforcement
15problem, or if issuance would result in or add to an undue
16concentration of licenses.

17(B) For purposes of this paragraph, the following definitions
18shall apply:

19(i) “Population within the census tract or census division” means
20the population as determined by the most recent United States
21decennial or special census. The population determination shall
22not operate to prevent an applicant from establishing that an
23increase of resident population has occurred within the census tract
24or census division.

25(ii) “Reported crimes” means the most recent yearly compilation
26by the local law enforcement agency of reported offenses of
27criminal homicide, forcible rape, robbery, aggravated assault,
28burglary, larceny, theft, and motor vehicle theft, combined with
29all arrests for other crimes, both felonies and misdemeanors, except
30traffic citations.

31(iii) “Reporting districts” means geographical areas within the
32boundaries of a single governmental entity (city or the
33unincorporated area of a county) that are identified by the local
34law enforcement agency in the compilation and maintenance of
35statistical information on reported crimes and arrests.

36(iv) “Undue concentration” means:

37(I) The applicant premises are located in a crime reporting
38district that has a 20 percent greater number of reported crimes
39than the average number of reported crimes as determined from
P30   1all crime reporting districts within the jurisdiction of the local law
2enforcement agency.

3(II) The ratio of licenses to population within the census tract
4or census division in which the applicant premises are located
5exceeds the ratio of licenses to population in the county in which
6the applicant premises are located.

7(d) The bureau may consult with other state agencies, state
8departments, public entities, or private entities for the purposes of
9establishing statewide standards and regulations.

10(e) The bureau may assist state taxation authorities in the
11development of uniform policies for the state taxation of licensees.

12(f) The bureau may assist the Division of Occupational Safety
13and Health in the Department of Industrial Relations in the
14development of industry-specific regulations related to the activities
15of licensees.

end delete
begin insert
16

begin insert18119.end insert  

An application for or renewal of a license shall not be
17approved if the bureau determines any of the following:

18(a) The applicant fails to meet the requirements of this part or
19any regulation adopted pursuant to this part or any applicable
20city, county, or city and county ordinance or regulation. Local
21governments shall submit to the bureau documentation detailing
22their renewal requirements.

23(b) The applicant, or any of its officers, directors, owners,
24members, or shareholders is a minor.

25(c) The applicant has knowingly answered a question or request
26for information falsely on the application form, or failed to provide
27information requested.

28(d) The applicant, or any of its officers, directors, owners,
29members, or shareholders has been sanctioned by the bureau, a
30city, county, or city and county, for medical marijuana activities
31conducted in violation of this part or any applicable local
32ordinance or has had a license revoked in the previous five years.

33(e) The proposed cultivation, processing, possession, storage,
34manufacturing, testing, transporting, distribution, provision, or
35sale of medical marijuana will violate any applicable local law
36or ordinance.

end insert
begin insert
37

begin insert18120.end insert  

The bureau may assist state taxation authorities in the
38development of uniform policies for the state taxation of licensees.

end insert
begin insert
39

begin insert18121.end insert  

The bureau may assist the Division of Occupational
40Safety and Health in the Department of Industrial Relations in the
P31   1development of industry-specific regulations related to the activities
2of licensees.

end insert
begin insert
3

begin insert18122.end insert  

(a) For licensees licensed pursuant to this part located
4within the incorporated area of a city, the city shall have full power
5and authority to enforce this part and Article 8 (commencing with
6Section 111658) of Chapter 6 of Part 5 of Division 104 of the
7Health and Safety Code and the rules, regulations, and standards
8promulgated by the bureau. The city shall further assume complete
9responsibility for any regulatory function relating to those licensees
10within the city limits that would otherwise be performed by the
11county or any county officer or employee, without liability, cost,
12or expense to the county.

13(b) For licensed facilities located within the unincorporated
14area of a county, the county shall have full power and authority
15to enforce this part and Article 8 (commencing with Section
16111658) of Chapter 6 of Part 5 of Division 104 of the Health and
17Safety Code and the rules, regulations, and standards promulgated
18by the bureau.

end insert
19

begin delete18107.end delete
20begin insert18123.end insert  

(a) A person shall not distribute any form of advertising
21for physician recommendations for medical marijuana in California
22unless the advertisement bears the following notice to consumers:


24NOTICE TO CONSUMERS: The Compassionate Use Act of
251996 ensures that seriously ill Californians have the right to obtain
26and use marijuana for medical purposes where medical use is
27deemed appropriate and has been recommended by a physician
28who has determined that the person’s health would benefit from
29the use ofbegin insert medicalend insert marijuana. Physicians are licensed and regulated
30by the Medical Board of California and arrive at the decision to
31make this recommendation in accordance with accepted standards
32of medical responsibility.


34(b) Advertising for physician recommendations for medical
35marijuana shall meet all requirements of Section 651. Price
36advertising shall not be fraudulent, deceitful, or misleading,
37including statements or advertisements of bait, discounts,
38premiums, gifts, or statements of a similar nature.

P32   1

begin delete18108.end delete
2begin insert18124.end insert  

(a) A facility licensed pursuant to this part shall
3implement sufficient security measures to both deter and prevent
4unauthorized entrance into areas containing marijuana and theft
5of marijuana at those facilities. These security measures shall
6include, but not be limited to, all of the following:

7(1) Allow only qualifying patients, the patient’s primary
8caregiver, and facility agents access to the facility.

9(2) Prevent individuals from remaining on the premises of the
10facility if they are not engaging in activity expressly related to the
11operations of the facility.

12(3) Establish limited access areas accessible only to authorized
13facility personnel.

14(4) Store all finished marijuana in a secured and locked room,
15safe, or vault, and in a manner as to prevent diversion, theft, and
16loss.

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

20(1) Discrepancies identified during inventory.

21(2) Diversion, theft, loss, or any criminal activity involving the
22facility or a facility agent.

23(3) The loss or unauthorized alteration of records related to
24marijuana, registered qualifying patients, personal caregivers, or
25facility agents.

26(4) Any other breach of security.

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

begin insert
33

begin insert18125.end insert  

The chief shall keep a complete record of all entities
34licensed or certified pursuant to this part. This record shall be
35made available on the bureau’s Internet Web site.

end insert
begin insert
36

begin insert18126.end insert  

The bureau shall provide state and local law
37enforcement, upon their request, with information to verify a
38license, track transportation manifests, and track inventories of
39dispensing facilities.

end insert
P33   1

begin delete18108.5.end delete
2begin insert18127.end insert  

(a) The bureau shall require an annual audit of all
3licensees licensed pursuant to this part or otherwise licensed by
4the bureau to cultivate, manufacture, process, transport, store, or
5sellbegin insert medicalend insert marijuana to be paid for by each licensed vendor and
6dispensary.

7(b) Completed audit reports shall also be submitted by the
8licensee to local code enforcement offices, or the appropriate
9locally designated enforcement entity, within 30 days of the
10 completion of the audit.

11(c) It is the responsibility of each licensee licensed pursuant to
12this part or otherwise licensed by the bureau to cultivate,
13manufacture, process, transport, store, or sellbegin insert medicalend insert marijuana
14to develop a robust quality assurance protocol that includes all of
15the provisions of this part.

16

begin delete18108.6.end delete
17begin insert18128.end insert  

(a) A laboratory certified by the bureau to perform
18random sample testing ofbegin insert medicalend insert marijuana products pursuant to
19paragraph (5) of subdivision (a) of Sectionbegin delete 18106end deletebegin insert 18105end insert shall not
20acquire, cultivate, process, possess, store, manufacture, distribute,
21sell, deliver, transfer, transport, or dispensebegin insert medicalend insert marijuana for
22any purpose other than those authorized by Article 2.5
23(commencing with Section 11362.7) of Chapter 6 of Division 10
24of the Health and Safety Code.

25(b) A laboratory certified by the bureau to perform random
26sample testing ofbegin insert medicalend insert marijuana products pursuant to paragraph
27(5) of subdivision (a) of Sectionbegin delete 18106end deletebegin insert 18105end insert shall not acquire,
28cultivate, process, possess, store, manufacture, distribute, sell,
29deliver, transfer, transport, or dispensebegin insert medicalend insert marijuana plants
30orbegin insert medicalend insert marijuana products except through a licensed cultivation
31site, orbegin delete processing facilityend deletebegin insert a licensed manufacturerend insert.

32

begin delete18109.end delete
33begin insert18129.end insert  

In addition to the provisions of this part, a license
34granted pursuant to this part shall be subject to the restrictions of
35the local jurisdiction in which the facility operates or proposes to
36operate. Even if a license has been granted pursuant to this part, a
37facility shall not operate in a local jurisdiction that prohibits the
38establishment of that type of business.

P34   1

begin delete18110.end delete
2begin insert18130.end insert  

(a) A willful violation of Sectionbegin delete 18101.2end deletebegin insert 18106end insert,
3including any attempt to falsify information on an application as
4required by Sectionbegin delete 18101.2end deletebegin insert 18106end insert, or to otherwise defraud or
5mislead a state or local agency in the course of the application
6process, shall be punishable by a civil fine of up to thirty-five
7thousand dollars ($35,000) for each individual violation. This
8subdivision shall apply to both the provisional and permanent
9licensing application processes under this part.

10(b) A technical violation of Sectionbegin delete 18101.2end deletebegin insert 18106end insert shall, at the
11bureau’s discretion, be punishable by a civil fine of up to ten
12thousand dollars ($10,000) for each individual violation. This
13subdivision shall apply to both the provisional and permanent
14licensing application processes under this part.

15

begin delete18110.1.end delete
16begin insert18131.end insert  

The executive officer or any district attorney, county
17counsel, city attorney, or city prosecutor may bring an action to
18enjoin a violation or the threatened violation of any provision of
19this part, including, but not limited to, a licensee’s failure to correct
20objectionable conditions following notice or as a result of any rule
21promulgated pursuant to this part. The action shall be brought in
22the county in which the violation occurred or is threatened to occur.
23Any proceeding brought pursuant to this part shall conform to the
24requirements of Chapter 3 (commencing with Section 525) of Title
257 of Part 2 of the Code of Civil Procedure. Nothing in this section
26shall diminish the authority ofbegin insert aend insert local government to take requisite
27enforcement actions pertaining to its own ordinances or regulations.

28

begin delete18111.end delete
29begin insert18132.end insert  

Nothing in this part shall prevent a city or other local
30governing body from taking action as specified in Section 11362.83
31of the Health and Safety Code.

32

begin delete18112.end delete
33begin insert18133.end insert  

This part shall in no way supersede the provisions of
34Measure D, approved by the voters of the City of Los Angeles on
35the May 21, 2013, ballot for the city, which grantedbegin insert medicalend insert
36 marijuana businesses and dispensaries qualified immunity
37consistent with the terms of the measure and local ordinances.
38Notwithstanding the provisions of this part, marijuana businesses
39and dispensaries subject to the provisions of Measure D and its
P35   1qualified immunity shall continue to be subject to the ordinances
2and regulations of the City of Los Angeles.

begin insert
3

begin insert18134.end insert  

The bureau shall limit the number of licensed cultivation
4sites statewide to prevent the diversion of medical marijuana for
5nonmedical purposes. In determining this number, the bureau shall
6commence its calculation with the number of cultivation sites
7licensed and permitted pursuant to a city, county, or city and
8county cultivation ordinance. The bureau shall calculate the
9number of sites pursuant to this section based upon the following,
10after consultation with law enforcement representatives, health
11care providers, and local and statewide health officials:

12(a) The need to prevent the potential of diversion of medical
13marijuana for nonmedical purposes.

14(b) The number of applicants whose applications for licensed
15cultivation sites demonstrate that they will be able to produce
16consistent products with strict quality controls in full compliance
17with this part and with all applicable state and local regulations,
18and the amount of medical marijuana those applicants will be able
19to provide.

20(c) The need for the bureau to ensure that the number of licensed
21cultivation sites it approves does not exceed the ability of the
22bureau to enforce the provisions of this part, particularly with
23respect to conducting regular site visits and audits, ensuring patient
24safety, and preventing illegal diversion of marijuana.

25(d) A license for a facility or cultivation site shall not be issued
26for a premises that is located in a jurisdiction where the exercise
27of the rights and privileges conferred by the license are contrary
28to a valid zoning ordinance of the city, county, or city and county.

end insert
begin delete
29

18113.  

(a) A patient who cultivates, possesses, stores,
30manufactures, or transports marijuana exclusively for his or her
31personal medical use and who does not sell, distribute, donate, or
32provide marijuana to any other person is not considered a licensee
33under this part and is exempt from licensure under this part.

34(b) A primary caregiver who cultivates, possesses, stores,
35manufactures, transports, or provides marijuana exclusively for
36the personal medical purposes of no more than five specified
37qualified patients for whom he or she is the primary caregiver
38within the meaning of Section 11362.7 of the Health and Safety
39Code and who does not receive remuneration for these activities
40 except for compensation in full compliance with subdivision (c)
P36   1of Section 11362.765 of the Health and Safety Code is not
2considered a licensee under this part and is exempt from licensure
3under this part.

end delete
4

begin delete18114.end delete
5begin insert18135.end insert  

(a) Information identifying the names of patients, their
6medical conditions, or the names of their primary caregivers
7received and contained in records kept by the bureau for the
8purposes of administering this part are confidential and exempt
9from the California Public Records Act (Chapter 3.5 (commencing
10with Section 6250) of Division 7 of Title 1 of the Government
11Code) and are not subject to disclosure to any individual or private
12entity, except as necessary for authorized employees of the State
13of California to perform official duties pursuant to this part:

14(b) (1) Nothing in this section shall preclude any of the
15following:

16(A) Bureau employees notifying state or local agencies about
17information submitted to the bureau that the employee suspects is
18falsified or fraudulent.

19(B) Notifications from the bureau to state or local agencies of
20apparent violations of this part or any applicable local ordinance.

21(C) Verification of requests by state or local agencies to confirm
22licenses and certificates issued by the bureau or other state agency.

23(D) Provision of information requested pursuant to a court order
24or subpoena issued by a court or an administrative agency or local
25governing body authorized by law to issue subpoenas.

26(2) Information shall not be disclosed beyond what is necessary
27to achieve the goals of a specific investigation or notification or
28the parameters of a specific court order or subpoena.

29

begin delete18115.end delete
30begin insert18136.end insert  

(a) The actions of a licensee or provisional licensee,
31its employees, and its agents, permitted pursuant to a license or
32provisional license issued by the bureau or otherwise permitted
33by this part, that are conducted in accordance to the requirements
34of this part and regulations adopted pursuant to the authority
35granted by this part, are not unlawful under state law and shall not
36be an offense subject to arrest or prosecution.

37(b) The actions of a person who, in good faith and upon
38investigation, allows his or her property to be used by a licensee
39 or provisional licensee, its employees, and its agents, as permitted
40pursuant to a license or provisional license issued by the bureau
P37   1or otherwise permitted by this part, are not unlawful under state
2law and shall not be an offense subject to arrest or prosecution.

3(c) This section shall not be deemed to limit the authority or
4remedies of a city, county, or city and county under any provision
5of law, including, without limitation, Section 7 of Article XI of
6the California Constitution.

7

begin delete18116.end delete
8begin insert18137.end insert  

(a) A licensee shall not cultivate, process, store,
9manufacture, transport, or sell medical marijuana in the state unless
10accurate records are kept at the licensed premises of the growing,
11processing, storing, manufacturing, transporting, or selling by the
12licensee in the state. These records shall include the name and
13address of the supplier of any marijuana received or possessed by
14the licensee, the location at which the marijuana was cultivated,
15the amount of marijuana received, the form in which it is received,
16the name of the employee receiving it, and the date of receipt.
17These records shall also include receipts for all expenditures
18incurred by the licensee and banking records, if any, for all funds
19obtained or expended in the performance of any activity under the
20authority of the license, provided that a licensee licensed to act at
21more than one premises may keep all records at one of the licensed
22premises. Required records shall be kept for a period of seven
23years from the date of the transaction.

24(b) The bureau and any state or local agency may make any
25examination of the books and records of any licensee and may
26visit and inspect the premises of any licensee that the bureau may
27deem necessary to perform its duties under this part.

28(c) Any books or records requested by the bureau or any state
29or local agency shall be provided by the licensee no later than at
30the end of the next business day after the request is made.

31(d) The bureau or any state or local agency may enter and inspect
32the premises of any facility operated by a licensee between the
33hours of 8 a.m. and 8 p.m. on any day that the facility is open, or
34at any reasonable time, to ensure compliance and enforcement of
35the provisions of this part or any local ordinance.

36(e) If a licensee or any employee of a licensee refuses, impedes,
37obstructs, or interferes with an inspection pursuant to this part or
38local ordinance, or if the licensee fails to maintain or provide the
39books and records required by this section, the licensee may be
40summarily suspended pursuant to this part and the bureau shall
P38   1directly commence proceedings for the revocation of the license
2in accordance with this part.

begin insert
3

begin insert18138.end insert  

This part shall not be construed to limit a law
4enforcement agency’s ability to investigate unlawful activity in
5relation to a licensee licensed pursuant to this part.

end insert
6

SEC. 5.  

Section 23028 is added to the Government Code, to
7read:

8

23028.  

(a) (1) In addition to any authority otherwise provided
9by law, the board of supervisors of any county may impose, by
10ordinance, a tax on the privilege of cultivating, dispensing,
11producing, processing, preparing, storing, providing, donating,
12selling, or distributing marijuana by a licensee operating pursuant
13to Chapter 18 (commencing with Section 26000) of Division 9 of
14the Business and Professions Code. The tax may be imposed for
15general governmental purposes or for purposes specified in the
16ordinance by the board of supervisors.

17(2) The board of supervisors shall specify in the ordinance
18proposing the tax the activities subject to the tax, the applicable
19rate or rates, the method of apportionment, and the manner of
20 collection of the tax. A tax imposed pursuant to this section is a
21tax and not a fee or special assessment, and the tax is not required
22to be apportioned on the basis of benefit to any person or property
23or be applied uniformly to all taxpayers or all real property.

24(3) A tax imposed by a county pursuant to this section by a
25county may include a transactions and use tax imposed solely for
26marijuana or marijuana products, which shall otherwise conform
27to Part 1.6 (commencing with Section 7251) of Division 2 of the
28Revenue and Taxation Code. Notwithstanding Section 7251.1 of
29the Revenue and Taxation Code, the tax may be imposed at any
30rate specified by the board of supervisors, and the tax rate
31authorized by this section shall not be considered for purposes of
32the combined tax rate limitation established by that section.

33(4) The tax authorized by this section may be imposed upon
34any or all of the activities set forth in paragraph (1), regardless of
35whether the activity is undertaken individually, collectively, or
36cooperatively, and regardless of whether the activity is for
37compensation or gratuitously, as determined by the board of
38supervisors.

P39   1(5) The board of supervisors shall specify whether the tax applies
2throughout the entire county or within the unincorporated area of
3the county.

4(b) In addition to any other method of collection authorized by
5law, the board of supervisors may provide forbegin insert theend insert collection of the
6tax imposed pursuant to this section in the same manner, and
7subject to the same penalties and priority of lien, as other charges
8and taxes fixed and collected by the county.

9(c) Any tax imposed pursuant to this section shall be subject to
10applicable voter approval requirements imposed by any other law.

11(d) For purposes of this section, “marijuana” shall have the
12meanings set forth in Section 18100 of the Business and
13Professions Code.

14(e) This section does not limit or prohibit the levy or collection
15or any other fee, charge, or tax, or any license or service fee or
16charge upon, or related to, the activities set forth in subdivision
17(a) as otherwise provided by law. This section shall not be
18construed as a limitation upon the taxing authority of any county
19as provided by other law.

20begin insert

begin insertSEC. 6.end insert  

end insert

begin insertSection 11362.775 of the end insertbegin insertHealth and Safety Codeend insertbegin insert is
21amended to read:end insert

22

11362.775.  

begin insert(a)end insertbegin insertend insertQualified patients, persons with valid
23identification cards, and the designated primary caregivers of
24qualified patients and persons with identification cards, who
25associate within the State of California in order collectively or
26cooperatively to cultivate marijuana for medical purposes, shall
27not solely on the basis of that fact be subject to state criminal
28sanctions under Section 11357, 11358, 11359, 11360, 11366,
2911366.5, or 11570.

begin insert

30(b) An individual employee, officer, or board member of a
31cultivation site licensee or provisional licensee licensed pursuant
32to Part 5 (commencing with Section 18100) of Division 7 of the
33Business and Professions Code shall not be subject to state
34criminal sanctions under Section 11357, 11358, 11359, 11360,
3511366, 11366.5, or 11570 and any successor statutes, or under
36any local ordinance imposing criminal liability for the activities
37described in those sections, for the possession, cultivation,
38processing, packaging for transport or sale, warehousing,
39transportation, or sale or distribution of medical marijuana to a
40licensee licensed pursuant to Part 5 (commencing with Section
P40   118100) of Division 7 of the Business and Professions Code or
2directly to qualified patients, persons with valid identification
3cards, or the designated primary caregivers of qualified patients
4or persons with a valid identification card, within the State of
5California, unless the information contained on the licensing
6paperwork is false or falsified, the license has been obtained by
7means of fraud, or the person is otherwise in violation of Part 5
8(commencing with Section 18100) of Division 7 of the Business
9and Professions Code.

end insert
begin insert

10(c) An individual employee, officer, or board member of a
11dispensing facility licensee or provisional licensee licensed
12pursuant to Part 5 (commencing with Section 18100) of Division
137 of the Business and Professions Code shall not be subject to
14state criminal sanctions under Section 11357, 11359, 11360,
1511366, 11366.5, or 11570 and any successor statutes, or under
16any local ordinance imposing criminal liability for the activities
17described in those sections, for the possession, packaging for
18transport, sale, warehousing, transportation, sale, or distribution
19of medical marijuana to qualified patients, persons with valid
20identification cards, or the designated primary caregivers of
21qualified patients or persons with a valid identification card, within
22the State of California, unless the information contained on the
23licensing paperwork is false or falsified, the license has been
24obtained by means of fraud, or the person is otherwise in violation
25of Part 5 (commencing with Section 18100) of Division 7 of the
26Business and Professions Code.

end insert
begin insert

27(d) This section shall in no way diminish the protections
28provided in Section 18101 of the Business and Professions Code.

end insert
29

begin deleteSEC. 6.end delete
30begin insertSEC. 7.end insert  

Article 8 (commencing with Section 111658) is added
31to Chapter 6 of Part 5 of Division 104 of the Health and Safety
32Code
, to read:

33 

34Article 8.  Medical Marijuana
35

 

36

111658.  

For purpose of this article, the following definitions
37shall apply:

38(a) “Bureau” means the Bureau of Medical Marijuana
39Regulations in the Department of Consumer Affairs.

P41   1(b) “Certified testing laboratories” means a laboratory that is
2certified by the bureau to perform random sample testing of
3begin insert medicalend insert marijuana pursuant to the certification standards for those
4facilities promulgated by the bureau.

5(c) “Ediblebegin insert medicalend insert marijuana product” meansbegin insert medicalend insert
6 marijuana or abegin insert medicalend insert marijuana-derived product that is ingested
7or meant to be ingested through the mouth and into the digestive
8system.

9(d) “Marijuana” means all parts of the plant Cannabis sativa L.
10sativa, cannabis indica, or cannabis ruderalis, whether growing or
11not; the seeds thereof; the resin, whether crude or purified,
12extracted from any part of the plant; and every compound,
13manufacture, salt, derivative, mixture, or preparation of the plant,
14its seeds, or resin. “Marijuana” does not include the mature stalks
15of the plant, fiber produced from the stalks, oil or cake made from
16the seeds of the plant, any other compound, manufacture, salt,
17 derivative, mixture, or preparation of the mature stalks (except the
18resin extracted therefrom), fiber, oil, or cake, or the sterilized seed
19of the plant which is incapable of germination. “Marijuana” also
20means marijuana, as defined by Section 11018.

21(e) “Representative samples” means samples taken from each
22batch or shipment ofbegin insert medicalend insert marijuana received from a licensed
23cultivation site or any other source if intended for sale.

24

111659.  

The bureau, by July 1, 2016, shall accomplish the
25following:

26(a) Establish quality assurance protocols to ensure uniform
27testing standards for allbegin insert medicalend insert marijuana sold via dispensaries
28or other facilities, or cultivatedbegin insert or manufacturedend insert by any facilities,
29that are licensed pursuant to Part 5 (commencing with Section
3018100) of Division 7 of the Business and Professions Code.

31(b) In consultation with outside entities at its discretion, develop
32a list of certified testing laboratories that can perform uniform
33testing in compliance with this article, and post that list on its
34Internet Web site.

35

111660.  

(a) Licensees licensed pursuant to Part 5 (commencing
36with Section 18100) of Division 7 of the Business and Professions
37Code shall bear the responsibility for contracting with certified
38testing laboratories for regular, systematic testing of representative
39samples of allbegin insert medicalend insert marijuana cultivated or intended for sale
40or distribution, and shall bear the cost of that testing.

P42   1(b) Licensees licensed pursuant to Part 5 (commencing with
2Section 18100) of Division 7 of the Business and Professions Code
3shall provide results of test reports to local code enforcement
4officers, any other locally designated enforcement entity, and the
5bureau both on a quarterly basis and upon request.

6

111661.  

Quality assurance protocols shall be required between
7all licensed cultivation sitesbegin delete or licensed processing facilitiesend deletebegin insert,
8licensed manufacturers,end insert
and licensed dispensing facilities to
9guarantee safe and reliable medicinal marijuana delivery to all
10patients. These quality assurance protocols shall include:

11(a) Providing of supplier information to dispensaries in order
12for recall procedures to be implemented, if and when necessary.

13(b) Safety testing of allbegin insert medicalend insert marijuana prior to packaging
14for sale and patient exposure to identify and eliminate
15microbiological contaminants and chemical residue.

16(c) Labeling of allbegin insert medicalend insert marijuana andbegin insert medicalend insert marijuana
17products that shall, at a minimum, include the following:

18(1) Clear dosage in total milligrams delivered for all products.

19(2) Clear indication, in bold font, that the product contains
20begin insert medicalend insert marijuana.

21(3) Tetrahydrocannabinol (THC)begin delete andend deletebegin insert content,end insert cannabidiol
22(CBD) contentbegin insert, and any pharmacologically active ingredient as
23specified by the bureauend insert
.

24

111662.  

For purposes of this article, ediblebegin insert medicalend insert marijuana
25products are deemed to be unadulterated food products. In addition
26to the quality assurance standards provided in Section 111661, all
27ediblebegin insert medicalend insert marijuana products shall comply with the following
28requirements:

29(a) Baked ediblebegin insert medicalend insert marijuana products (such as brownies,
30bars, cookies, and cakes), tinctures, and other ediblebegin insert medicalend insert
31 marijuana products that do not require refrigeration or hot holding
32may be manufactured, sold, or otherwise distributed at facilities
33licensed pursuant to Part 5 (commencing with Section 18100) of
34Division 7 of the Business and Professions Code.

35(b) Licensedbegin insert medicalend insert marijuana facilities shall have an owner
36or employee who has successfully passed an approved and
37accredited food safety certification examination as specified in
38Sections 113947.1, 113947.2, and 113947.3begin delete of the Health and
39Safety Codeend delete
prior to selling, manufacturing, or distributing edible
40begin insert medicalend insert marijuana products requiring refrigeration or hot holding.

P43   1(c) Individuals’ manufacturing or selling ediblebegin insert medicalend insert
2 marijuana products shall thoroughly wash their hands before
3commencing production and before handling finished edible
4begin insert medicalend insert marijuana products.

5(d) All ediblebegin insert medicalend insert marijuana products shall be individually
6wrapped at the original point of preparation. All ediblebegin insert medicalend insert
7 marijuana products shall be packaged in a fashion that does not
8exceed a single individual serving size.

9(e) Products containing tetrahydrocannabinol (THC) shall be
10prepared in compliance with maximum potency standards for THC
11and THC concentrates set forth in the bureau’s regulations.

12(f) Prior to sale or distribution at a licensed dispensing facility,
13ediblebegin insert medicalend insert marijuana products shall be labeled and in an
14opaque and tamper evident package. Labels and packages of edible
15begin insert medicalend insert marijuana products shall meet the following requirements:

16(1) Ediblebegin insert medicalend insert marijuana packages and labels shall not be
17made to be attractive to children.

18(2) All ediblebegin insert medicalend insert marijuana product labels shall include
19the following information, prominently displayed and in a clear
20and legible font:

21(A) Manufacture date.

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

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

24(D) Net weight ofbegin insert medicalend insert marijuana in package.

25(E) A warning, if nuts or other known allergens are used, and
26shall include the total weight, in ounces or grams, ofbegin insert medicalend insert
27 marijuana in the package.

28(F) Tetrahydrocannabinol (THC) and cannabidiol (CBD)
29content.

30(g) Photos or images of food are not allowed on ediblebegin insert medicalend insert
31 marijuana product packages or labels.

32(h) Only generic food names may be used to describe edible
33begin insert medical end insertmarijuana products. For example, “snickerdoodle” may
34not be used to describe a cinnamon cookie.

35

begin deleteSEC. 7.end delete
36begin insertSEC. 8.end insert  

The provisions of this act are severable. If any
37provision of this act or its application is held invalid, that invalidity
38shall not affect other provisions or applications that can be given
39effect without the invalid provision or application.

P44   1

begin deleteSEC. 8.end delete
2begin insertSEC. 9.end insert  

The Legislature finds and declares that Section 4 of
3this act imposes a limitation on the public’s right of access to the
4meetings of public bodies or the writings of public officials and
5agencies within the meaning of Section 3 of Article I of the
6California Constitution. Pursuant to that constitutional provision,
7the Legislature makes the following findings to demonstrate the
8interest protected by this limitation and the need for protecting
9that interest:

10The limitation imposed under this act is necessary for purposes
11of compliance with the federal Health Insurance Portability and
12Accountability Actbegin insert of 1996end insert (42 U.S.C. Sec. 1320d et seq.), the
13Confidentiality of Medical Information Act (Part 2.6 (commencing
14with Section 56) of Division 1 of the Civil Code), and the Insurance
15Informationbegin insert andend insert Privacy Protection Act (Article 6.6 (commencing
16with Sectionbegin delete 79)end deletebegin insert 791)end insert ofbegin delete Chapter 1 ofend delete Part 2 of Division 1 of the
17Insurance Code).

18

begin deleteSEC. 9.end delete
19begin insertSEC. 10.end insert  

No reimbursement is required by this act pursuant to
20Section 6 of Article XIII B of the California Constitution because
21the only costs that may be incurred by a local agency or school
22district will be incurred because this act creates a new crime or
23infraction, eliminates a crime or infraction, or changes the penalty
24for a crime or infraction, within the meaning of Section 17556 of
25the Government Code, or changes the definition of a crime within
26the meaning of Section 6 of Article XIII B of the California
27Constitution.


CORRECTIONS:

Text--Page 18.




O

Corrected 8-7-14—See last page.     93