BILL ANALYSIS Ó
-----------------------------------------------------------------
|SENATE RULES COMMITTEE | AB 26|
|Office of Senate Floor Analyses | |
|(916) 651-1520 Fax: (916) | |
|327-4478 | |
-----------------------------------------------------------------
THIRD READING
Bill No: AB 26
Author: Jones-Sawyer (D), et al.
Amended: 8/15/16 in Senate
Vote: 21
SENATE BUS., PROF. & ECON. DEV. COMMITTEE: 7-1, 6/27/16
AYES: Hill, Block, Galgiani, Hernandez, Jackson, Mendoza,
Wieckowski
NOES: Gaines
NO VOTE RECORDED: Bates
SENATE APPROPRIATIONS COMMITTEE: 5-2, 8/11/16
AYES: Lara, Beall, Hill, McGuire, Mendoza
NOES: Bates, Nielsen
ASSEMBLY FLOOR: 63-1, 1/27/16 - See last page for vote
SUBJECT: Medical cannabis
SOURCE: United Food and Commercial Workers Union
DIGEST: This bill requires, after July 1, 2018, Medical
Marijuana Regulation and Safety Act (Act) license applicants
with 20 or more employees to implement an employee training
program to educate, inform, and train the licensee's agents and
employees on compliance with the Act.
ANALYSIS:
Existing law:
AB 26
Page 2
1) Establishes the Bureau of Medical Marijuana Regulation
(Bureau) within the Department of Consumer Affairs (DCA) to
oversee the licensing and regulation of medical marijuana.
(Business and Professions Code (BPC) § 19300, et seq.)
2) Defines a "licensing authority" as the state agency
responsible for the issuance, renewal, or reinstatement of
the license, or the state agency authorized to take
disciplinary action against the license. (BPC § 19300.5 (w))
3) Requires a license applicant with 20 or more employees to
provide a statement that the applicant will enter into, or
demonstrate that it has already entered into, and abide by
the terms of a labor peace agreement, as a condition of state
licensure under the Act. (BPC § 19322 (a)(6))
This bill:
1) Requires, beginning July 1, 2018, applicants with 20 or more
employees to attest on an application that the applicant will
implement an employee training program approved by the
licensing authority within one year of licensure.
2) Requires, beginning July 1, 2018, the licensing authority to
deny an application of an applicant with 20 or more employees
unless the applicant attests that the applicant will
implement an employee training program approved by the
licensing authority within one year of licensure.
3) Requires a licensee to implement an employee training
program, or contract with a third party to provide an
employee program, to educate, inform, and train the
licensee's employees on compliance with the Act.
4) Requires an employee training program to include, but not be
limited to, training on applicable statutory requirements,
industry best practices, occupational health and safety
standards, and workplace protections.
5) Requires each licensing authority to adopt standards for the
approval of employee training programs. Such standards shall
prohibit approval of an employee training program provided by
or through an apprenticeship program approved by the Chief of
AB 26
Page 3
the Division of Apprenticeship Standards. Those standards
shall also prohibit employee training programs provided by
licensees except when a licensee provides a training program
to its own employees.
6) Authorizes a licensing authority to approve a workplace
training organization as a third-party provider of employee
training programs. Defines a "workplace training
organization" as a labor union organization representing wage
earners or salaried employees for mutual aid and protection
and for dealing collectively with cannabis employers.
7) States that a licensing authority shall not be limited to
approving workplace training organizations as third-party
providers of employee training programs, except that a
licensing authority shall not approve a third party provider
of an employee training program if the provider is a
licensee, as specified.
8) Requires a licensing authority to revoke the license of any
licensee with 20 or more employees that fails to implement an
employee training program within one year of licensure.
9) Requires each licensing authority to charge a fee for
approving a training program provided by workplace training
organization. Total fees assessed shall not exceed the
reasonable regulatory costs for training program. Each
licensing authority may adjust fees as needed, but no more
than once per year, to generate sufficient revenue to cover
the costs of training program approval.
10)Requires revenues collected to be deposited in the
appropriate fee account within the Medical Marijuana
Regulation and Safety Act Fund.
11)States that no reimbursement is required because the only
costs that may be incurred by a local agency or school
district will be incurred because this act creates a new
crime or infraction, eliminates a crime or infraction, or
changes the penalty for a crime or infraction, or changes the
definition of a crime.
Background
AB 26
Page 4
California began regulating medical marijuana with the passage
of the Compassionate Use Act in 1996, which exempted patients
and their primary caregivers from criminal liability under state
law for the possession and cultivation of marijuana. In 2003,
the Legislature authorized the formation of medical marijuana
cooperatives-nonprofit organizations that cultivate and
distribute marijuana for medical uses to their members through
dispensaries. Most recently, the Medical Marijuana Regulation
and Safety Act (Act) passed in 2015, which consisted of three
separate bills enacted together to license and regulate medical
marijuana AB 243 (Wood, Chapter 688, Statues of 2015); AB 266
(Bonta, Chapter 689, Statutes of 2015); and SB 643 (McGuire,
Chapter 719, Statutes of 2015). These bills created a
comprehensive state licensing system for the commercial
cultivation, manufacture, retail sale, transport, distribution,
delivery, and testing of medical cannabis. Medical marijuana
cooperatives will be phased out under the Act and replaced by
state licensed businesses.
The Act went into effect on January 1, 2016, and licensure
requirements will follow when the regulatory entities
responsible for implementation pass necessary regulations.
The Act distributes state responsibilities among six agencies:
The Bureau: license and regulate dispensaries, transporters,
and distributors.
Department of Fish and Wildlife: monitor and reduce
environmental impacts of marijuana cultivation.
State Water Resources Control Board: regulate the
environmental impacts of marijuana cultivation on water
quality and instream flows.
California Department of Food and Agriculture (CDFA): regulate
medical marijuana cultivation and issue licenses to growers.
Department of Public Health (DPH): develop and enforce
regulations and standards for medical marijuana product
manufacturers and testing laboratories.
Department of Pesticide Regulation: develop pesticide use
guidelines for the cultivation of medical marijuana.
AB 26
Page 5
This bill requires license applicants with 20 or more employees
to implement a training program to educate, inform, and train
the licensee's agents and employees on compliance with the Act
within one year of licensure. The licensee may either conduct
the training by his or herself or hire a third party provider,
which may be a union organization, but shall not be a separate
licensee. However, this bill prohibits approval of employee
training program provided by or through an apprenticeship
program approved by the Chief of the Division of Apprenticeship
Standards.
It is unclear why the exclusions from apprenticeship programs
and other licensees exists; one would think that organizations
and individuals that already provide training programs and are
familiar with the cannabis business would be ideally suited for
this new industry. The rationale for these provisions is
unclear.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:YesLocal: Yes
According to the Senate Appropriations Committee, the fiscal
estimates for this bill are subject to a good deal of
uncertainty. Currently, none of the medical cannabis licensing
authorities have begun issuing licenses. Thus, the number of
entities that each licensing authority will ultimately license
is unknown. Similarly, the number of providers of employee
training programs required under the bill is unknown. Therefore,
the cost estimates are subject to uncertainty. The costs to
implement the bill's requirements would ultimately be paid for
by licensees or third-party training program providers.
Currently, the start-up activities of licensing entities are
being paid for out of a
$10 million loan from the General Fund, until licensing revenues
are received.
One-time costs of $540,000 and ongoing costs of $500,000 for
the Bureau to establish regulations, review and approve
employee training programs (either provided by the licensee
directly or by a third-party provider), and audit dispensary,
AB 26
Page 6
transporter, and testing laboratory licensees to ensure that
they are in compliance with the requirement to provide an
employee training program (Medical Cannabis Regulation and
Safety Act Fund).
Ongoing costs of $220,000 per year for DPH to establish
regulations, review and approve employee training programs
(either provided by the licensee directly or by a third-party
provider), and audit manufacturer licensees to ensure that
they are in compliance with the requirement to provide an
employee training program (Medical Cannabis Regulation and
Safety Act Fund).
Ongoing costs up to $500,000 per year for the CDFA to
establish regulations, review and approve employee training
programs (either provided by the licensee directly or by a
third-party provider), and audit cultivator licensees to
ensure that they are in compliance with the requirement to
provide an employee training program (Medical Cannabis
Regulation and Safety Act Fund).
SUPPORT: (Verified8/12/16)
United Food and Commercial Workers Union (source)
California Labor Federation
Central Coast Forest Association
City of Santa Monica
League of California Cities
OPPOSITION: (Verified8/12/16)
California Cannabis Industry Association
ARGUMENTS IN SUPPORT: The United Food and Commercial Workers
Union (UFCW) writes, "With the passage of the Act, UFCW strongly
supports the creation of a robust program to train cannabis
workers in the industry at the California DCA.
AB 26
Page 7
"Professional licensing and safety standards are widely accepted
norms throughout the State of California for a variety of
occupations and we should do the same for workers employed in
the cannabis industry. Cannabis workers need vital knowledge of
their product and how best to serve the needs of people
suffering from serious diseases."
ARGUMENTS IN OPPOSITION: The California Cannabis Industry
Association (CCIA) writes, "The CCIA was supportive of AB 26 as
amended in the Senate Business, Professions & Economic
Development Committee, but strongly objects to more recent
amendments taken in the Senate Appropriations Committee. These
latest amendments intentionally and unfairly prohibit ALL
licensed cannabis operators from applying to be third party
training providers.
"AB 26 now limits business opportunities for legitimate
licensees, and creates an unfair advantage for labor
organizations and independent out-of-state training program
providers. It also deprives students and cannabis employees,
participating in third party training programs, of learning from
the most experienced professionals within the industry.
"CCIA worked tirelessly last year to develop the Medical
Marijuana Regulation and Safety Act (MMRSA), which established a
framework to regulate and license medical cannabis operations in
California. Our support of this effort was driven by our
members' strong desire to be regulated like other industries in
California and our stalwart commitment to ensuring the highest
standards for our industry, including our workers.
"For these reasons, we strongly object to the recent amendments,
which would deny a cannabis operator the ability to conduct
third party training. The CCIA is aware of no other profession
in which third party training is prohibited from being conducted
by a licensee if authorized by the State. In fact, when AB 26
was introduced in January, the CCIA was reassured by the
sponsors that the intent of the bill was to create a similar
training standard to those required by the California State
Board of Barbering and Cosmetology (see press release, dated
January 14, 2016). In that field, neither licensed manufacturers
of products, cosmetologists, barbers, nor salon operators are
prohibited from opening a new school for barbering or
AB 26
Page 8
cosmetology or applying for an apprenticeship."
ASSEMBLY FLOOR: 63-1, 1/27/16
AYES: Alejo, Baker, Bloom, Bonilla, Bonta, Brown, Burke,
Calderon, Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley,
Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Cristina Garcia,
Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray,
Roger Hernández, Holden, Irwin, Jones-Sawyer, Lackey, Levine,
Linder, Lopez, Low, Maienschein, Mathis, Mayes, McCarty,
Medina, Mullin, O'Donnell, Olsen, Quirk, Rendon,
Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark
Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams,
Wood, Atkins
NOES: Travis Allen
NO VOTE RECORDED: Achadjian, Bigelow, Brough, Cooper, Beth
Gaines, Gallagher, Grove, Hadley, Harper, Jones, Kim,
Melendez, Nazarian, Obernolte, Patterson
Prepared by:Sarah Huchel / Sarah Mason / B., P. & E.D. / (916)
651-4104
8/15/16 20:33:17
**** END ****