BILL ANALYSIS                                                                                                                                                                                                    

          |SENATE RULES COMMITTEE            |                         AB 21|
          |Office of Senate Floor Analyses   |                              |
          |(916) 651-1520    Fax: (916)      |                              |
          |327-4478                          |                              |

                                   THIRD READING 

          Bill No:  AB 21
          Author:   Wood (D), Bonta (D), Cooley (D), Jones-Sawyer (D), and  

          Lackey (R), et al.
          Amended:  1/21/16 in Senate
          Vote:     27  - Urgency


           SENATE GOVERNANCE & FIN. COMMITTEE:  6-0, 1/13/16
           AYES:  Hertzberg, Nguyen, Beall, Lara, Moorlach, Pavley
           NO VOTE RECORDED:  Hernandez

           SENATE HEALTH COMMITTEE:  7-0, 1/20/16
           AYES:  Hernandez, Hall, Mitchell, Monning, Pan, Roth, Wolk
           NO VOTE RECORDED:  Nguyen, Nielsen

           SUBJECT:   Medical marijuana:  cultivation licenses

          SOURCE:    Author

          DIGEST:  This bill repeals a March 1, 2016 deadline by which  
          cities and counties must act on ordinances to regulate or ban  
          medical marijuana cultivation and allows local governments to  
          exercise their police powers over certain cultivators of medical  


          Existing law:


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          1)Prohibits the possession, possession with intent to sell,  
            cultivation, sale, transportation, importation, or furnishing  
            of marijuana.

          2)Prohibits criminal prosecution, pursuant to the Compassionate  
            Use Act (CUA) of 1996, also known as Proposition 215, of a  
            qualified patient with specified illnesses, or a patient's  
            primary caregiver, for the possession or cultivation of  
            medical marijuana upon the written or oral recommendation or  
            approval of an attending physician. 

          3)Provides, pursuant to the Medical Marijuana Regulation and  
            Safety Act (MMRSA), for the licensing and regulation by both  
            state and local entities of medical marijuana and its  

          4)Grants the California Department of Food and Agriculture  
            (CDFA) sole licensing authority for medical marijuana  
            cultivation applicants if a city, county, or city and county  
            does not have land use regulations or ordinances regulating or  
            prohibiting the cultivation of medical marijuana by March 1,  

          5)Exempts qualified patients and a patient's primary caregiver  
            from obtaining state and local licenses or permits for the  
            cultivation of marijuana for personal use or for use of the  
            qualified patient if certain square footage requirements for  
            cultivation are met. 

          6)Provides that exemption from the license or permit requirement  
            does not limit or prevent a city, county, or city and county  
            from regulating or banning the cultivation, storage,  
            manufacture, transport, provision, or other activity by the  
            exempt person, or impair the enforcement of that regulation or  


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          7)Grants, under the California Constitution, cities and counties  
            the authority to make and enforce within its limits all local,  
            police, sanitary, and other ordinances and regulations not in  
            conflict with general laws-known as the "police power."

          This bill:  

          1)Deletes a provision of existing law that grants CDFA sole  
            licensing authority for medical marijuana cultivation  
            applicants if a city, county, or city and county does not have  
            land use regulations or ordinances regulating or prohibiting  
            the cultivation of medical marijuana by March 1, 2016.

          2)Deletes the provision of existing law that provides that  
            exemption from the licensing requirements for qualified  
            patients and primary caregivers does not limit local  
            government's ability to regulate or ban medical marijuana  
            activities by exempt individuals.

          3)Specifies that exemption from the licensing requirements for  
            qualified patients does not limit or prevent a local  
            government from exercising its police power under the  
            California Constitution. 

          4)Makes technical changes.


          Until 2015, California's $1 billion medical marijuana industry  
          was largely unregulated.  In response to growing medical  
          marijuana activity, local governments have sought to exercise  
          their police powers to regulate or ban activities relating to  
          medical marijuana.  Under this power, many cities in California  
          permanently banned dispensary operations, while others have  


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          adopted temporary land use moratoria, adopted regulations  
          permitting a limited number of dispensaries, or otherwise  
          regulated the sale, storage, and delivery of medical marijuana.  
          Other jurisdictions have established "permissive" zoning  
          ordinances, whereby any land use-such as cultivation of medical  
          marijuana-that is not explicitly authorized by the ordinance is  

          State law, including initiatives, generally preempt local  
          ordinances when the two conflict.  However, courts have  
          generally supported local agencies against claims that  
          ordinances regulating or banning medical marijuana activities  
          conflict with the CUA or SB 420 (Vasconcellos, Chapter 875,  
          Statutes of 2003).  In particular, the California Supreme Court  
          upheld local dispensary bans in City of Riverside v. Inland  
          Empire Patients Health and Welfare Center (Case S198638, 2013).   
          In addition, the Third Appellate District Court upheld local  
          cultivation bans in Maral v. City of Live Oak (Case C071822,  
          2013).  In general, courts have reasoned that nothing in the CUA  
          or SB 420 expressly or impliedly limited the inherent authority  
          of a local jurisdiction, by its own ordinances, to regulate the  
          use of its land, including the authority to provide that  
          facilities for the distribution of medical marijuana will not be  
          permitted to operate within its borders.  Accordingly, many  
          California jurisdictions, roughly estimated by the League of  
          California Cities at 50% pending completion of a statewide  
          survey, ban the cultivation and sale of medical marijuana  

          Medical Marijuana Regulation and Safety Act.  In 2015, the  
          Legislature enacted MMRSA, a package of legislation that  
          comprehensively regulates many aspects of medical marijuana  
          including cultivation, manufacturing, transportation,  
          distribution, sale, and product safety. The MMRSA comprises  
          three bills-SB 643 (McGuire, Chapter 719, Statutes of 2015), AB  
          243 (Wood, Chapter 688, Statutes of 2015), and AB 266 (Bonta,  
          Chapter 689, Statutes of 2015). Among other actions, the MMRSA  
          explicitly authorizes local governments to establish a licensing  
          system for the cultivation of medical marijuana through their  
          current or future land use authority, and prohibits the  
          cultivation of medical marijuana without obtaining both a state  
          license-issued by CDFA-and a local license.  However, MMRSA also  


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          designates CDFA as the sole licensing authority for medical  
          marijuana cultivation in cities or counties that have not  
          developed regulations or banned medical marijuana cultivation by  
          March 1, 2016.  

          On September 11, 2015, Assemblymember Wood wrote a letter in the  
          Assembly Journal stating his intent to introduce cleanup  
          legislation to address three errors in MMRSA, including to  
          remove the March 1, 2016 deadline and to remove a provision  
          explicitly authorizing local governments to regulate or ban  
          cultivation within their jurisdiction.

          Faced with the prospect of permanently losing their authority to  
          regulate medical marijuana cultivation, many cities and counties  
          are moving quickly to ban medical marijuana cultivation.  At  
          least 19 cities have banned cultivation following the passage of  
          AB 243, and according to a December 31, 2015 San Francisco  
          Chronicle article, at least 40 cities and counties across the  
          state were currently considering bans of medical marijuana  
          cultivation or have a ban pending approval.  Some local  
          officials want more time to consider the best way to regulate  
          medical marijuana cultivation in their jurisdictions and adopt  
          appropriate zoning ordinances.


          Purpose of this bill. The MMRSA contains two inadvertent errors  
          made at the close of the 2015 legislative session that imposes a  
          significant burden on local governments and on qualified  
          patients. First, by permanently making CDFA the sole regulator  
          of medical marijuana cultivation in cities and counties that do  
          not have regulations in place by March 1, 2016, this provision  
          of MMRSA undermines the principle of local control that exists  
          throughout the remainder of the act. It also creates a very real  
          risk of a state agency imposing uniform regulations on  
          cultivation that do not consider the needs and unique  
          circumstances of local communities.  AB 21 provides a  
          straightforward solution to this issue by removing the deadline  
          and the related risk of a state takeover of cultivation  
          licensing. Second, AB 21 addresses concerns with a provision  
          that could have inadvertently expanded local authority to  


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          regulate qualified patients and caregivers by tying any ability  
          of local governments to regulate to their police powers granted  
          by the California Constitution. These fixes are urgently needed  
          to stem the tide of cities and counties banning cultivation and  
          to ensure that the rights of qualified patients and caregivers  
          are not unreasonably restricted.


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          Related Legislation

          AB 1575 (Bonta), currently pending referral in the Assembly, was  
          introduced in January 2016 to address some additional drafting  
          errors in MMRSA, including an error raised in Assemblymember  
          Wood's letter to the Journal.  Specifically, AB 1575 clarifies  
          that increased fees for remediation of environmental impacts of  
          marijuana cultivation shall be levied on only medical marijuana  
          cultivation activities that require a permit to alter a lake or  
          streambed, instead of increasing fees on any entity that  
          requires that type of permit.  AB 1575 also requires the  
          Department of Public Health to establish uniform safety  
          standards on packaging of medical marijuana, allows the Bureau  
          of Medical Marijuana Regulation to issue temporary permits for  
          businesses to perform medical marijuana-related activities,  
          requires the Bureau to establish standards for the delivery of  
          medical marijuana and for dispensary employees, and exempts  
          commercial medical marijuana activity by a licensed person from  
          criminal penalties associated with the transportation, sale, or  
          administration of controlled substances in the state.  In  
          addition, two bills address the taxation of medical marijuana  

          SB 297 (McGuire, 2015), currently pending in the Senate  
          Appropriations Committee, states the legislature's intent to  
          impose an excise tax on medical marijuana at the point of sale.   

          AB 1548 (Wood, 2015), currently pending in the Assembly Revenue  
          and Taxation Committee, establishes a tax on the cultivation of  
          medical marijuana to fund environmental restoration and law  
          enforcement activities related to illegal marijuana cultivation.

          FISCAL EFFECT:   Appropriation:    No          Fiscal  
          Com.:NoLocal:    No

          SUPPORT:   (Verified1/21/16)


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          Americans for Safe Access
          American Civil Liberties Union of California
          California Growers Association
          California Police Chiefs Association
          California State Association of Counties
          City of Oakland
          City of San Leandro
          County of Del Norte
          Drug Policy Alliance
          League of California Cities
          Rural County Representatives of California
          Urban Counties of California

          OPPOSITION:   (Verified1/21/16)

          None received

          Prepared by:Anton Favorini-Csorba / GOV. & F. / (916) 651-4119
          1/22/16 12:41:24

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