BILL ANALYSIS Ó
AB 34
Page 1
Date of Hearing: April 28, 2015
ASSEMBLY COMMITTEE ON BUSINESS AND PROFESSIONS
Susan Bonilla, Chair
AB 34
(Bonta and Jones-Sawyer) - As Amended April 23, 2015
SUBJECT: Medical cannabis regulation and enforcement.
SUMMARY: Establishes a licensing and regulatory framework for
medical cannabis under the Medical Cannabis Regulation and
Control Act, and would establish the Division of Medical
Cannabis Regulation and Enforcement within the Department of
Alcoholic Beverage Control (ABC), the Division of Medical
Cannabis Manufacturing and Testing within the State Department
of Public Health (CDPH), and the Division of Medical Cannabis
Cultivation within the Department of Food and Agriculture
(CDFA), and would set forth the duties of the respective
regulatory authorities.
EXISTING LAW:
1)Recognizes the authority of cities and counties to make and
enforce, within their borders, all local, police, sanitary,
and other ordinances and regulations not in conflict with
general interest laws. (Cal. Const. Art. XI Sec. 7)
2)Licenses and regulates physicians and surgeons under the
Medical Practice Act (Act) by the Medical Board of California
(MBC), within the Department of Consumer Affairs (DCA).
AB 34
Page 2
(Business and Professions Code (BPC) Section 2000 et seq.)
3)Requires the MBC to prioritize its investigative and
prosecutorial resources to ensure that physicians representing
the greatest threat of harm are identified and disciplined
expeditiously and includes in that prioritization list:
"Repeated acts of clearly excessive prescribing, furnishing,
or administering of controlled substances, or repeated acts of
prescribing, dispensing, or furnishing of controlled
substances without a good faith prior examination of the
patient and medical reason therefor." (BPC Section 2220.05)
4)Prohibits the possession, possession with intent to sell,
cultivation, sale, transportation, importation, or furnishing
of marijuana, except as otherwise provided by law. (Health
and Safety Code (HSC) Sections 11357, 11358, 11359, and 11360)
5)Prohibits prosecution under the Compassionate Use Act of 1996
(CUA), an initiative measure, for the possession or
cultivation of marijuana of a patient or a patient's primary
caregiver who possesses or cultivates marijuana for the
personal medical purposes of the patient upon the written or
oral recommendation or approval of a physician. (HSC Section
11362.5)
6)States that nothing in the CUA shall be construed to supersede
legislation prohibiting persons from engaging in conduct that
endangers others, or to condone the diversion of marijuana for
non-medical purposes. (HSC Section 11362.5(b)(2))
7)Provides that no physician in California shall be punished, or
denied any right or privilege, for having recommended
marijuana to a patient for medical purposes. (HSC Section
11362.5(c))
8)Defines "attending physician" as an individual who possesses a
license in good standing to practice medicine or osteopathy
issued by the MBC or the Osteopathic Medical Board of
California and who has taken responsibility for an aspect of
AB 34
Page 3
the medical care, treatment, diagnosis, counseling, or
referral of a patient and who has conducted a medical
examination of that patient before recording in the patient's
medical record the physician's assessment of whether the
patient has a serious medical condition and whether the
medical use of marijuana is appropriate. (HSC Section
11362.7(a))
9)Defines "primary caregiver" for purposes of the CUA as the
individual designated by a patient who has consistently
assumed responsibility for the housing, health, or safety of
that person. (HSC Section 11362.7(d))
10)Requires the CDPH to establish and maintain a voluntary
Medical Marijuana Program for qualified patients to apply for
identification cards, and county health departments to issue
identification cards to qualified patients and their
caregivers. (HSC Section 11362.7 et seq.)
11)Requires a person who seeks an identification card to pay a
fee and provide to the county health department the person's
name, proof of residency, written documentation by the
attending physician in the person's medical records stating
that the person has been diagnosed with a serious medical
condition and that the medical use of marijuana is
appropriate, and the doctor's name, contact information, and
California medical license number, as specified. (HSC Section
11362.715(a))
12)Makes it a misdemeanor offense to, among other things,
fraudulently represent a medical condition or provide any
material misinformation to a physician, health department
designee, or to law enforcement, for the purpose or falsely
obtaining an identification card; counterfeit, tamper with, or
fraudulently produce an identification card; or breach any
confidentiality requirements pertaining to an identification
card program. (HSC Section 11362.81)
13)Provides that qualified patients, persons with valid
AB 34
Page 4
identification cards, and their designated primary caregivers
who associate in order to collectively or cooperatively to
cultivate marijuana are not subject to criminal liability
solely on that basis. (HSC Section 11362.775)
THIS BILL:
General Provisions
1)Establishes the Medical Cannabis Regulation and Control Act
(Act).
2)Provides that, without limiting the authority of a city or
county pursuant to Section 7 of Article XI of the California
Constitution, and subject to that authority, the state shall
have the exclusive right and power to regulate and license
persons for the cultivation, manufacture, transportation,
sale, and other related activities regarding medical cannabis
in the state.
3)Defines the following terms:
a) "Regulatory authority" means the Division of Medical
Cannabis Regulation and Enforcement within the ABC, the
Division of Medical Cannabis Manufacturing and Testing
within the CDPH, or the Division of Medical Cannabis
Cultivation within the CDFA, as appropriate to the context;
b) "Division" means the Division of Medical Cannabis
Regulation and Enforcement within the ABC;
c) "Commercial cannabis activity" means any cultivation,
AB 34
Page 5
possession, manufacture, processing, storing, laboratory
testing, labeling, transporting, distributing, or sale of
cannabis or cannabis product, except as specified;
d) "Medical cannabis product," "medical marijuana product,"
or "cannabis product" means any product containing
cannabis, including, but not limited to, concentrates and
extractions intended to be sold for use by medical
marijuana patients in California pursuant to the
Compassionate Use Act of 1996 (Proposition 215);
e) "Manufactured cannabis" means raw marijuana that has
undergone a process whereby the raw agricultural product
has been transformed into a concentrate, an edible product,
or a topical product;
f) "Dispensary" means a retail location that distributes
cannabis or medical cannabis products and is owned and
operated by a licensee;
g) "Testing and labeling" means a labeling and quality
assurance plan that addresses all of the following:
potency; chemical residue; microbiological contaminants;
handling, care, and storage; and date and location of
cultivation, processing, and manufacturing;
h) "Cultivation site" means a location that grows cannabis
or medical cannabis products and is owned and operated by a
licensee, including a nursery;
i) "Cultivation" means any activity involving the planting,
growing, harvesting, drying, processing, or trimming of
cannabis; and,
AB 34
Page 6
4)Provides that the Act does not prevent a city or county from
doing any of the following:
a) Adopting local ordinances inconsistent with the Act that
do the following:
i) Regulate the location, operation, or establishment
of a licensee or any person that cultivates, processes,
possesses, stores, manufactures, tests, transports,
distributes, or sells medical cannabis.
ii) Prohibit commercial cannabis activity within their
jurisdiction.
b) Administrative, civil or criminal enforcement of the
ordinances described under a), or establishing a fee or tax
for the operation of a licensee within its jurisdiction;
or,
c) Enacting and enforcing other laws or ordinances pursuant
to the authority granted by Section 7 of Article XI of the
California Constitution.
State Framework
5)Establishes the Division of Medical Cannabis Regulation and
Enforcement within the ABC, and requires the Division to:
AB 34
Page 7
a) Be administered by a person who is appointed by the
Director of the ABC, and administer the Act, as it pertains
to commercial cannabis activity relating to dispensaries.
b) Lead all state and local authorities regarding the
tracking of medical cannabis, medical cannabis products and
licensees pursuant to the Act.
c) Maintain a registry of all permit holders and shall
maintain a record of all licensees and commercial cannabis
activity of the permit holder throughout the length of
licensure and for a minimum of seven years following the
expiration of the licensure.
d) Keep a complete record of all entities licensed pursuant
to the Act, which shall be made available on the Division's
Internet Web site so as to permit state and local law
enforcement to verify a mandatory commercial license.
e) Develop a database containing electronic shipping
manifests, as specified, and designed to flag
irregularities for any regulatory authority to investigate.
f) Adopt regulations regarding the minimum standards for
the operation of dispensaries, including:
i) A requirement that dispensaries provide patients
with detailed written information about the contents of
the cannabis and medical cannabis products they obtain;
AB 34
Page 8
ii) Requirements for inventory control and reporting
that require all dispensaries to be able to demonstrate
the present location, amounts, and descriptions of all
medical cannabis products from the time of delivery to
the dispensary until purchase by a qualified patient or
primary caregiver;
iii) Minimum educational and testing requirements for
licensee staff, including, but not limited to, background
checks and a requirement that every dispensary maintain
dedicated, licensed security staff both inside and
outside the dispensary;
iv) Minimum standards governing signage and advertising
for dispensaries.
g) Commencing 180 days after the Division begins issuing
provisional licenses, only allows a dispensary to provide
patients medical cannabis and medical cannabis products
obtained only from persons licensed under the Act.
6)Establishes the Division of Medical Cannabis Manufacturing and
Testing within the CDPH, and requires it to:
a) Be administered by a person who is appointed by the
State Health Officer and administer the Act as it pertains
to manufacturing, testing, and certification of testing
laboratories for medical cannabis, and adopt regulations
that:
i) Establish product labeling and packaging standards
and requirements that require manufactured cannabis
AB 34
Page 9
products to include:
(1) A label to include the manufacturing date,
name of the mandatory commercial licensee from which
it was obtained, the active ingredients, net weight,
cannabinoid profile, nutritional facts, dosage in
total milligrams of cannabinoids delivered, and any
potential allergens.
(2) Warning that state, "KEEP OUT OF REACH OF
CHILDREN AND ANIMALS" and "FOR MEDICAL USE ONLY."
(3) Clear indication in bold font that the package
contains medical cannabis. The package shall not be
designed in a manner that attracts minors.
(4) Standards that clearly distinguish edible
cannabis products from non-cannabis products.
(5) The name of the mandatory commercial licensee
that manufactured the product.
ii) Establish consumer protection, food and product
safety requirements, including:
(1) Adverse event reporting and product recall
systems and the requirement that employees who
manufacture or handle edible cannabis products to
thoroughly wash their hands;
(2) Standards for cannabinoid dosage in edible
AB 34
Page 10
products;
(3) Sanitation standards equivalent to the
California Retail Food Code for food preparation,
storage, handling, and sale of medical cannabis
products;
(4) A requirement that edible medical cannabis
products be limited to foods that are not potentially
hazardous food;
(5) Weighing or measuring standards, as specified;
(6) Standards controlling the application of
pesticides; and,
(7) A requirement that all edible medical cannabis
products be individually wrapped at the original point
of preparation.
iii) Establish testing requirements for all medical
cannabis and medical cannabis products, including:
(1) Testing for the active cannabinoid profile,
constituent elements, and microbiological, bacterial,
pathogenic yeast, and mold counts;
(2) Testing standards by which to test and measure
the potency of medical cannabis and medical cannabis
products. The Division of Medical Cannabis
AB 34
Page 11
Manufacturing and Testing shall also determine maximum
potency standards in the potency of medical cannabis
and medical cannabis products;
(3) Testing standards by which to test and measure
the quality of medical cannabis and medical cannabis
products; and,
(4) Protocols for medical cannabis and medical
cannabis product testing.
iv) Establish procedures for certifying laboratories for
the testing of medical cannabis and medical cannabis
products, which shall be consistent with general
requirements for the competence of testing and
calibration activities, as specified.
b) Ensure licensed cannabis cultivation entities have
access to existing agricultural incentive and support
programs.
7)Establishes the Division of Medical Cannabis Cultivation
within the CDFA, and requires it to:
a) Adopt regulations, in consultation with the Department
of Water Resources to ensure that commercial cannabis
activity does not threaten the state's clean water and
environment.
b) Adopt regulations ensuring that the cultivation of
cannabis under the Act is in compliance with the standards
equivalent to the statutory and regulatory requirements
AB 34
Page 12
applicable to the production of a food crop, including:
i) Cultivation protocols ensuring the quality,
availability, and safety of the cannabis crop, including
both indoor and outdoor cultivation standards and
regulations regarding carbon offsets for indoor
cultivation; and,
ii) Environmentally sound agricultural practices,
including a requirement that any actual or potential for,
environmental damage be addressed by the relevant state
agency; a provision authoring revocation of a license if
the state determines that the conduct of the licensee
threatens to inflict or has inflicted significant damage
to the environment; and standards controlling the
application of pesticides;
c) Adopt regulations to establish cultivation labeling and
packaging standards and requirements, including, but not
limited to, cultivation labeling requirements requiring
labeling to include cannabinoid levels, cannabinoid
profile, and active ingredients.
8)Requires each regulatory entity to adopt regulations as needed
to implement the licensing program within one year following
the establishment of a provisional license, as specified,
which shall not limit the authority of a city or a county
pursuant to Section 7 of Article XI of the California
Constitution, or any other law, and require the regulations
to:
a) Establish a scale of application, licensing, and renewal
fees, based upon the cost of enforcing the Act, as
specified;
AB 34
Page 13
b) Establish procedures for the approval or denial of
applications for commercial cannabis activity;
c) Establish applicant qualifications and licensee employee
qualifications, including training and screening
requirements, and licensee security requirements, including
procedures to limit access to facilities and to prevent
diversion of product to nonmedical use;
d) Establish procedures and protocols for identifying,
managing, and disposing of contaminated, adulterated,
deteriorated, or excess product and advertising, marketing,
signage, and labeling requirements and restrictions;
e) Establish procedures for the suspension, revocation, or
surrender of a license and establishing related fines and
penalties for violations;
Licensing Framework
9)Exempts from licensure a patient who cultivates, possesses,
stores, manufactures, or transports medical cannabis only for
his her personal medical use, or a primary caregiver who does
so only for the personal medical purposes of his or her
specified qualified patient, as specified.
10)Provides that 180 days after the issuance of provisional
licenses under the Act, that criminal immunity for qualified
patients, persons with valid identification card, and the
designated primary caregivers of qualified patients and
persons with identification cards who collectively and
AB 34
Page 14
cooperatively cultivate marijuana for medical purposes shall
not apply to licenses under the Act.
11)Requires the regulatory authority to issue licenses to
applicants to engage in commercial cannabis activity pursuant
to the Act, and prohibits persons from engaging in commercial
cannabis activity unless the person obtains permission from
local authorities, as specified.
12)Prohibits a person from engaging in commercial cannabis
activity unless the person:
a) Obtains permission from local authorities, and requires
the document granting permission to include:
i) Legal name, address, and date of birth of the
applicant and the type of license the applicant is
requesting a permit for;
ii) Documentation that the applicant has been in
compliance with local ordinances and regulations,
including, but not limited to, an entity granted immunity
under Measure D, as specified;
iii) A statement of whether or not the applicant has
previously committed a drug trafficking, serious, or
violent felony, a felony involving fraud or deceit or any
other felony, as determined by the Division; and
iv) A statement signed by the applicant under penalty
of perjury that the information provided in the
application is true.
AB 34
Page 15
b) Provides that this requirement for permission from local
authorities does not apply to a person who holds a valid
business license, conditional use permit, or other locally
issued permit for commercial cannabis activity;
c) Submits a copy of the permission, or equivalent
qualifying documents, to the Division for recordation, and
requires the Division, upon receipt of an approved
permission, to provide the applicant with a certificate of
approval for licensure, to be presented to the relevant
regulatory authority under which the person seeks
licensure. Prohibits a regulatory authority from granting
approval of an application without a certificate of
approval;
d) Applies for licensure from commercial cannabis activity
from a regulatory authority and receives approval for that
licensure; and
e) Abides by all local and state ordinances and regulations
pursuant to the Act.
13)Provides that an application for licensure shall include:
a) A certificate of approval for licensure by the Division.
b) The legal name and proposed physical addresses of the
mandatory commercial licensee, and the name, address, and
date of each principal officer and board member, and a list
of all persons or entities having an ownership interest
AB 34
Page 16
other than a security interest, lien, or encumbrances on
any property that will be used by the applicant, and
evidence that all of the officers and owners have been
residents of the State of California for at least three
years.
c) Operating and inventory control procedures to ensure
security and prevent diversion, and detailed operating
procedures for the proposed facility, which shall include
provisions for facility and operational security,
prevention of diversion, employee screening, storage of
medical cannabis, personnel policies, and recordkeeping
procedures.
d) Evidence of the legal right to occupy and use an
established location, or immunity from prosecution for that
occupancy or use pursuant to a local ordinance, as
specified, and documentation that the applicant will be in
compliance with all local ordinances and regulations, as
specified.
e) A statement signed by the applicant under penalty of
perjury that the information provided in the application is
true.
14)For applicants seeking a license to cultivate and process,
the application shall also include a detailed description of
the operating procedures for: cultivation; extraction and
infusion methods; transportation process; inventory
procedures; and quality control procedures.
15)Requires regulatory authorities, upon receipt of an
application and fee, to make a thorough investigation to
determine whether the applicant and the premises for which a
AB 34
Page 17
license is applied qualify for a license and whether the Act
has been complied with.
16)Authorizes a regulatory authority to place reasonable
conditions upon licensure if grounds exist for denial of the
license and the Division finds those grounds may be removed by
the imposition of those conditions. Provides that specified
limitations shall not be waived.
17)Requires a regulatory authority to deny a license or renewal
of a license if:
a) Granting or continuation of a license would be contrary
to the public welfare or morals, or the applicant or
license holder has violated any law prohibiting conduct
involving moral turpitude.
b) Local agencies have notified the Division and provided
evidence that the licensee or applicant within its
jurisdiction is in violation of local ordinances relating
to cannabis activities.
c) The applicant fails to meet the requirements of the Act
or any regulation adopted pursuant to the Act, or any
applicable city or county ordinance or regulation.
d) The applicant, or any of its officers, directors, or
owners, has been convicted of a felony criminal conviction
for drug trafficking, a violent felony, a serious felony, a
felony involved fraud or deceit, or any other felony, as
determined by the Division.
AB 34
Page 18
e) The applicant has been sanctioned by the Division or a
local government for unlicensed medical cannabis activities
or has had a license revoked in the last three years.
18)Requires the regulatory authority to submit to the Department
of Justice fingerprint images and related information for all
license applicants.
19)Requires regulatory authorities to adopt regulations
establishing tiered licensing schemes to accommodate the
different levels and types of activities to be licensed, as
specified.
20)Requires the regulations to set forth the application and
licensing process, including, but not limited to:
a) A description of the various specific forms of
commercial cannabis activity to be authorized by the
various types of licenses and the establishment of the
license application, issuance, renewal, suspension,
surrender, and revocation procedures for the various types
of licenses to be issued;
b) Procedures for the issuance, renewal, suspension, and
revocation of mandatory commercial licenses, and time
periods not to exceed 90 days by which the Division shall
approve or deny an application; and
c) Qualifications for licensees and security requirements.
21)Provides that each application approved by the respective
licensing authority is separate and distinct, and requires
AB 34
Page 19
each approved license application to be reported to the
Division within 24 hours.
22)Requires each regulatory authority to adopt, as soon as
practicable, emergency regulations consistent with the Act to
allow a qualified applicant for licensure to apply for, and
receive, a provisional license to engage in commercial
cannabis activity so as to ensure an adequate supply of
medical cannabis upon full implementation of the Act.
23)Requires each regulatory authority to, as soon as
practicable, allow a qualified applicant for licensure to
apply for and receive a provisional license, and establish
appropriate fees.
24)Requires each regulatory authority to issue a provisional
license to individuals and entities the authority determines
were, during the three months prior to January 1, 2016,
regularly cultivating, processing, manufacturing,
transporting, or distributing medical cannabis collectively or
cooperatively in full compliance with any applicable local
ordinance to continue to do so unless the licensee's
application has been approved or denied, but not later than 90
days after the authority begins accepting applications for
regular licenses.
25)Beginning July 1, 2017, all commercial cannabis activity
shall be conducted between licensees of commercial cannabis
activity pursuant to the Act, except as specified.
Enforcement
26)Requires state agencies to collaborate with local agencies,
AB 34
Page 20
and local agencies, within the scope of their jurisdiction,
and to the extent resources are available, to assist state
agencies in the enforcement of the Act, as specified.
27)Requires regulations to set forth the inspection and
enforcement responsibilities of the ABC, CDPH, Division of
Labor Standards Enforcement, Department of Water Resources,
and CDFA associated with the Act.
28)Requires the regulatory authority to enter into an
interagency agreement with the ABC, the DCA, the Division of
Labor Standards and Enforcement, the Department of Water
Resources, the CDPH, and the CDFA setting forth the duties of
those agencies under the Act and providing for reimbursement
to the appropriate state and local authorities of associated
costs from revenues deposited into the fees account of the
fund.
29)Provides that the regulatory directors and the persons
employed by the regulatory authorities for the administration
and enforcement of the Act are peace officers in the
enforcement of the penal provisions of the Act, the rules of
the division adopted under the Act, and any other penal
provisions of law in the state prohibiting or regulating the
cultivation, processing, storing, manufacturing, testing,
transporting, or selling of medical cannabis, and these
persons are authorized, while acting as peace officers, to
enforce any penal provisions of state law while in the course
of their employment.
30)Provides that regulatory directors, persons employed by
regulatory authorities, and peace officers, as specified,
while acting in the course and scope of their employment as
peace officers, may, in enforcing this chapter, visit and
inspect the premises of any licensee at any time during which
AB 34
Page 21
the licensee is acting pursuant to the mandatory commercial
license.
31)Provides that the actions of a licensee that are within the
scope of the license issued pursuant to the Act and the
regulations adopted pursuant to the authority granted by the
Act are not unlawful under state law and shall not be an
offense subject to arrest, prosecution, or other sanction
under state law, or subject to a civil fine.
32)Provides that conduct within the scope of a license but not
fully in compliance with this chapter shall not be subject to
the enforcement provisions of the Act and shall not be subject
to the penal provisions generally prohibited cannabis-related
activity, unless and until the license is revoked.
33)Requires each regulatory authority to work in conjunction
with law enforcement agencies for the purposes of
implementing, administering, and enforcing the Act and the
Division's regulations and taking appropriate action against
licensees and others who fail to comply with the Act or
regulations adopted pursuant to the Act.
34)Provides that nothing in the Act, or other related laws,
shall prevent a local government from adopting or enforcing a
zoning ordinance or other law, ordinance, or regulation that
regulates the location, operation, or establishment of a
license or other person that engages in commercial cannabis
activity.
35)Provides that if a person engages in commercial cannabis
activity and operates an unlicensed facility, building,
structure, or location in violation of the Act is subject to
unspecified civil penalties.
AB 34
Page 22
36)Requires a state or local agency to immediately notify the
Division of any violations or arrests made for violations over
which the Division has jurisdiction which involve a licensee
or licensed premises.
37)Authorizes a local government to impose a temporary local
suspension of the license of a commercial licensee for up to
30 days for violations of the Act, and may impose a subsequent
temporary local suspension of the license for the same
violation until the regulatory authority's investigation and
all appeals are complete.
Medical Cannabis Control Fund
38)Establishes the Medical Cannabis Control Fund within the
State Treasury.
39)Provides that all fees collected under the Act be deposited
into the fees account, which shall be established within the
fund and continuously appropriated to the Division solely for
the purposes of fully funding and administering the Act,
including the costs incurred by the Division for its
administrative expenses and costs and the costs of all
regulatory authorization, as specified.
40)Requires all monies collected under the Act as fines or
penalties be deposited into the fines and penalties account,
which shall be available, upon appropriation, for purposes of
funding the enforcement grant program.
41)Requires the regulatory authorizes to collaboratively
AB 34
Page 23
establish and administer a grant program to allocate moneys
from the fines and penalties account to state and local
entities for the purpose of assisting with medical cannabis
regulation and the enforcement of the Act and other state and
local laws.
42)Requires the total fees charged pursuant to the Act to be
sufficient to pay the costs associated with the administrative
and enforcement duties of the Division and of the associated
state agencies in administering the Act.
Health and Safety Standards
43) Requires the Department of Transportation to conduct
research regarding determining whether a driver is operating a
vehicle under the influence of cannabis, and to develop
protocols setting forth best practices to assist law
enforcement agencies.
44)Requires regulations on the cultivation of medical cannabis
to:
a) Require the licensee to comply with all regulations of
the CDFA pursuant to the Act regarding the cultivation of
medical cannabis and any other applicable requirements of
the Division pursuant to the Act.
b) Requires licensees to track all cannabis products and
report to the Division.
c) Requires all medical cannabis to be tested by a
laboratory that has been certified and licensed pursuant to
AB 34
Page 24
the Act prior to commercial exchange with a dispensary.
45)Requires regulations on the testing of medical cannabis to:
a) Prohibit a testing licensee from receiving medical
cannabis products except through a regulatory authority or
licensee.
b) Prohibit a licensee from being licensed for any other
activity authorized under licensing provisions, and from
holding an ownership interest in any property or assets
associated or used in any other license category.
46)Requires regulations on the manufacturing of medical cannabis
to:
a) Require the manufacturing licensee to comply with all
regulations of the CDPH regarding the cultivation of
medical cannabis and any other applicable requirement of
the Division.
b) Require licensees to track all cannabis products and
report to the Division.
c) Require all manufactured medical cannabis and medical
cannabis products to be tested by a laboratory that is
certified and licensed pursuant to the Act prior to
commercial exchange with a dispensary.
47)Requires regulations on the dispensing of medical cannabis
to:
AB 34
Page 25
a) Require the dispensary licensee to comply with all
regulations of the Division regarding the dispensary of
medical cannabis and any other applicable requirements of
the Division pursuant to the Act.
b) Allow dispensary licensees to store limited quantities
of medical cannabis and medical cannabis products for
commercial purposes pursuant to the act.
c) Allow all non-mobile, non-vehicular, and
non-Internet-based dispensaries to be licensed to transport
medical cannabis and medical cannabis products directly to
consumers.
d) Require all mobile, vehicular and Internet-based
dispensaries to maintain a business contract with a
non-vehicular and non-mobile dispensary, and report all
records of commercial activity to that entity.
e) Require licensees to track all medical cannabis and
medical cannabis products and report to the Division.
f) Require that, upon receipt of medical cannabis or
medical cannabis products, the dispensary licensee shall
request and record evidence that the product has been
tested by a laboratory that has been certified and
licensed.
48)Requires regulations for the wholesale of medical cannabis
to:
AB 34
Page 26
a) Require all wholesale licensees to comply with all
regulations of the Division regarding the wholesale storage
and distribution of medical cannabis.
b) Establish criteria for the qualifications, including
maximum amounts of medical cannabis that can be stored.
c) Require that all medical cannabis and medical cannabis
products be tested by the wholesale licensee prior to
commercial exchange with a dispensary.
d) Requires licensees to track all medical cannabis and
medical cannabis products and report to the Division.
Recordkeeping, Security, and Transportation Standards.
49)Requires a licensee to keep accurate records of the specific
commercial cannabis activity conducted by the licensee, as
specified.
50)Authorizes the division to make any examination of the books
and records of any licensee and to inspect and visit the
premises of the licensee, and if a licensee or its employee
refuses or impedes an inspection, or fails to maintain the
books or records, the license may be summarily suspended, as
specified.
51)Requires all cultivation, dispensing, and retail sales
licensees to be subject to an annual audit by the State
Auditor in order to ensure proper documentation is kept at
each site or facility.
AB 34
Page 27
52)Requires a licensee authorized to transport medical cannabis
and medical cannabis products to:
a) Prior to transport, complete an electronic shipping
manifest, as prescribed by the Division, and to securely
transmit the manifest to the Division and the licensee that
will receive the shipment.
b) During transportation, maintain a physical copy of the
shipping manifest and make it available to agents of the
Division, local law enforcement, or any other designated
enforcement agency.
53)Requires a licensee receiving the shipment to maintain each
electronic shipping manifest and make it available to agents
of the Division, local law enforcement, or any other
designated enforcement agency and submit to the Division a
record verifying receipt of the shipment and details of the
shipment.
54)Requires transported medical cannabis or medical cannabis
products worth more than $500 dollars at retail to be
transported only in secured storage compartments, as
specified.
55)Requires, for licensees transporting medical cannabis with a
retail value of over $5,000, transport vehicles to be staffed
with a minimum of two employees.
AB 34
Page 28
Taxation
56)Authorizes the regulatory authorities to assist state
taxation authorities in the development of uniform policies
for the state taxation of mandatory commercial licensees.
57)Requires licensees to obtain a seller's permit from the Board
of Equalization to validate the authority of the licensee to
sell medical cannabis or medical cannabis products to another
licensee.
58)Requires licensees to obtain a resale certificate upon the
sale of medical cannabis or medical cannabis to another
licensee, to track the quantities exchanged.
59)Authorizes the Board of Supervisors in any county to impose,
by ordinance, a tax on the privilege of cultivating,
dispensing, producing, processing, preparing, storing,
providing, donating, selling or distributing cannabis by a
licensee, as specified.
Labor Provisions.
60)Requires the Division of Labor Standards Enforcement
(Division) to:
a) Maintain minimum standards for the competency and
training of employees of licensed cultivator or dispensary
through a system of testing and certification;
AB 34
Page 29
b) Establish registration fees in an amount reasonably
necessary to implement this article, not to exceed $25 for
initial registration.
c) By January 1, 2017, develop a certification program for
cannabis employees, and commencing January 1, 2019, require
certification for all persons who perform work as cannabis
employees, except as specified.
d) By January 1, 2017, convene an advisory committee to
evaluate whether there is a need to develop
industry-specific regulations related to the activities of
licensees.
e) By July 1, 2017, require the advisory committee to
present its findings and recommendations to the Board of
the Division of Occupational Safety and Health in the
Department of Industrial Relations, and requires the Board
to render a decision regarding the adopting of these
regulations.
61)Beginning January 1, 2019, establishes additional grounds for
disciplinary proceedings, including suspension or revocation
of a license issued under the Act, as specified, and requires
the Division of Labor Standards Enforcement to refer cases to
the appropriate regulatory authority when it is determined
that a violation has occurred, as specified, and requires the
regulatory authority to open an investigation and take
disciplinary action within 60 days of receipt of the referral.
AB 34
Page 30
62)Requires the Division of Apprenticeship Standards to
investigate, approve, or reject applications for
apprenticeship programs for employees of a licensed cultivator
or dispensary, as specified.
Physician Provisions
63)Requires the MBC to prioritize cases involving physicians who
recommend marijuana to patients for medical purposes without a
good faith prior examination of the patient and medical reason
therefor.
64)Makes it unprofessional conduct to prescribe or recommend
marijuana to a patient for a medical purpose without an
appropriate prior examination and a medical indication, or to
be employed by, or have an agreement with, a mandatory
commercial licensee acting pursuant to the Act or a dispensary
to provide recommendations for medical marijuana.
FISCAL EFFECT: Unknown. This bill is keyed fiscal by the
Legislative Counsel.
COMMENTS
1)Purpose. This bill is author-sponsored. According to the
author: "In 1996, California made history by becoming the
first state in the nation to allow the use of medical cannabis
after voters approved Proposition 215. However, in the past
two decades, California has fallen behind the nation and
AB 34
Page 31
failed to implement a comprehensive licensing and regulatory
structure to ensure patient access and protect our
environment, public safety, and public health. AB 34 would
fulfill the promise made to the people of California back in
1996 by creating the structure in which patients can safely
exercise their right to medical cannabis. AB 34 approaches
regulation of medical cannabis with one core method-apply
existing regulatory frameworks to this new industry while
adapting for the unique and historical circumstances
surrounding medical cannabis. To this end, the bill divides
the licensing structure among multiple agencies that have
expertise in various industries that have similarities to that
of medical cannabis, in addition to requiring these agencies
to promulgate appropriate regulations for the medical cannabis
industry. AB 34 also ensures that all licensees and
transactions between them are tracked in order to fight
diversion of medical cannabis.
AB 34 recognizes that for too long, cities and counties have
been on the leading edge of crafting medical cannabis policies
when faced with murky state law and contradictory federal
priorities. That is why this bill respects local decisions on
the regulation of medical cannabis-including the decision to
ban-and incorporates local control throughout the regulatory
process, including the issuance and renewal of state licenses.
AB 34 protects patients by requiring compliance with
stringent regulatory requirements, preserves the environment
and protects water resources by building on the existing
interagency taskforce work in this field, and ensures that
workers in the cannabis industry are treated fairly and
receive equal protections under the labor code. AB 34
combines the input of stakeholders throughout the state to
create thoughtful, effective regulations that fit within our
existing regulatory frameworks for other products, comply with
federal goals, and create a better system for the entire life
cycle of the medical cannabis treatment."
AB 34
Page 32
2)Background.
The Compassionate Use Act (CUA) and SB 420. In 1996, voters
approved the CUA, which allowed patients and primary
caregivers to obtain and use medical marijuana, as recommended
by a physician, and prohibited physicians from being punished
or denied any right or privilege for making a medical
marijuana recommendation to a patient. In 2003, SB 420
(Vasconcellos), Chapter 875, Statutes of 2003, established the
Medical Marijuana Program (MMP), which allowed patients and
primary caregivers to collectively and cooperatively cultivate
medical marijuana, and established a medical marijuana card
program for patients to use on a voluntary basis. The card
can be used to verify that a patient has authorization to
possess, grow, transport, or use medical marijuana in
California, and that a caregiver has authorization to possess,
grow, and transport medical marijuana in California. The MMP
facilitates the registration of qualified patients and their
caregivers through a statewide identification system, and
qualified patients and their caregivers may apply for and be
issued an identification card through their county of
residence. Upon issuance of the card, it is registered with
an online database which law enforcement can use to verify
whether a card is valid.
Under the MPP, a person is required to get a recommendation
for medical marijuana from an attending physician, which is
defined to mean someone who, "? has taken responsibility for
an aspect of the medical care, treatment, diagnosis,
counseling, or referral of a patient and who has conducted a
medical examination of that patient before recording in the
patient's medical record the physician's assessment of whether
the patient has a serious medical condition and whether the
medical use of marijuana is appropriate." Written
documentation of this recommendation is required to be
submitted to the county in order to receive a medical
AB 34
Page 33
marijuana card. Since Proposition 215 and SB 420, however,
the state has not adopted a framework to provide for
appropriate licensure and regulation of medical marijuana. As
a result, in the nearly 20 years since the passage of
Proposition 215, there has been an explosion of medical
marijuana collectives and cooperatives that are largely left
to the enforcement of local governments, resulting in a
patchwork for regulations for these industries and with little
statewide involvement.
The California Attorney General's Compassionate Use
Guidelines. SB 420 required the California Attorney General
to "develop and adopt appropriate guidelines to ensure the
security and non-diversion of marijuana grown for medical use
by patients qualified under the Compassionate Use Act of
1996." In 2008, the Attorney General issued guidelines to: 1)
ensure that marijuana grown for medical purposes remains
secure and does not find its way to non-patients or illicit
markets, 2) help law enforcement agencies perform their duties
effectively and in accordance with California law, and 3) help
patients and primary caregivers understand how they may
cultivate, transport, possess, and use medical marijuana under
California law. According to a 2011 letter, after a series of
meeting with stakeholders to assess whether to clarify the
2008 guidelines to stop the exploitation of California's
medical marijuana laws by gangs, criminal enterprises, and
others, the Attorney General decided to postpone the issuance
of new guidelines because of pending litigation and to urge
the Legislature to amend the law to establish clear rules
governing access to medical marijuana.
California Supreme Court Affirms Local Control Over Medical
Marijuana. By exempting qualified patients and caregivers
from prosecution for using or from collectively or
cooperatively cultivating medical marijuana, the CUA and the
MPP essentially authorized the collective and cooperative
system for medical marijuana. These laws have triggered the
growth of medical marijuana dispensaries in many localities,
and in response, local governments have sought to exercise
AB 34
Page 34
their police powers to regulate or ban activities relating to
medical marijuana. After numerous court cases and years of
uncertainty relating to the ability of local governments to
control medical marijuana activities, particularly relating to
the ability to control the zoning, operation, and existence of
medical marijuana dispensaries, the California Supreme Court,
in City of Riverside v. Inland Empire Patients (2013) 56
Cal.4th 729, held that California's medical marijuana statutes
do not preempt a local ban on facilities that distribute
medical marijuana. The court held that nothing in the CUA or
the MMP 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.
Federal Controlled Substances Act. Despite the CUA and SB
420, marijuana is still illegal under state and federal law.
Under California law, marijuana is listed as a hallucinogenic
substance in Schedule I of the California Uniform Controlled
Substances Act. Yet, the CUA prohibits prosecution for
obtaining, distributing, or using marijuana for medical
purposes. However, under the federal Controlled Substances
Act, it is unlawful for any person to manufacture, distribute,
dispense or possess a controlled substance, including
marijuana, whether or not it is for a medical purpose. As a
result, patients, caregivers, and dispensary operators who
engage in activities relating to medical marijuana may still
vulnerable to federal arrest and prosecution. According to
the California Attorney General's guidelines, the difference
between state and federal law gives rise to confusion.
However, California has tried to avoid this conflict not by
legalizing medical marijuana, but by deciding not to use the
state's powers to punish certain marijuana offenses under
state law when a physician has recommended its use to treat a
serious medical condition.
U.S. Department of Justice (US DOJ) Guidance Regarding
Marijuana Enforcement. On August 29, 2013, the US DOJ issued
AB 34
Page 35
a memorandum (Cole Memo) that updated its guidance to all U.S.
Attorneys in light of state ballot initiatives to legalize
under state law the possession of small amounts of marijuana
and provide for the regulation of marijuana production,
processing, and sale. While the memorandum noted that illegal
distribution and sale of marijuana is a serious crime that
provides a significant source of revenue to large-scale
criminal enterprises, gangs, and cartels, it also noted that
the US DOJ is committed to using its limited investigative and
prosecutorial resources to address the most significant
threats, which include: preventing distribution to minors;
preventing revenue from marijuana from going to criminal
enterprises; preventing diversion to other states where
marijuana is not legal under state law; preventing
state-authorized marijuana from being a cover for trafficking
in other illegal drugs or illegal activity; preventing
violence in cultivating and distributing marijuana; preventing
drugged driving and other public health problems from
marijuana use; and preventing growing, possessing or using
marijuana on public lands or on federal property.
According to the US DOJ, "In jurisdictions that have enacted
laws legalizing marijuana in some form and that have also
implemented strong and effective regulatory and enforcement
systems to control the cultivation, distribution, sale, and
possession of marijuana, conduct in compliance with those laws
and regulations is less likely to threaten the federal
priorities set forth above?In those circumstances, consistent
with the traditional allocation of federal-state efforts in
this area, enforcement of state law by state and local law
enforcement and regulatory bodies should remain the primary
means of addressing marijuana-related activity."
Medical Marijuana Industry in California. According to the
author's Sunrise Questionnaire, there are no feasible means to
quantify the total number of medical cannabis practitioners in
California due to the unregulated nature of the industry. In
addition, although California has exercised its traditional
power to regulate the practice of medicine and has determined
that marijuana has medicinal properties that play a
AB 34
Page 36
significant role in medicine, marijuana is currently listed as
a Schedule I drug under federal law; therefore it has been
difficult for California practitioners within the field of
medicinal cannabis to work under standard business practices
without risking action from federal enforcement authorities.
However, according to the Emerald Growers Association, there
are an estimated 30,000 cultivation sites alone in the
tri-county area of Humboldt-Mendocino-Trinity. According to
numerous estimates, the California cannabis industry is in the
billions of dollars, and there are a reported 1.5 million
medical cannabis patients.
Need for Regulation. California has recognized the medicinal
value of cannabis and therefore all industry practices
relating to providing medical cannabis for the treatment of
medical conditions for qualified patients should be allowed
under state law. However, according to the author, in the
nearly two decades since the passage of Proposition 215, it is
clear that California remains very much in the Wild West of
medical marijuana.
Due to the lack of statewide regulations, practitioners within
the medical cannabis industry create their own standards
(e.g., labeling, potency, quality assurance, content, dosage
etc.). While certain partners within the industry may
collaborate with each other, there is no statewide standard
AB 34
Page 37
for practitioners to make professional judgments of
consequence. The lack of regulations results in practitioners
making these decisions on a daily basis during their business
practices. The consequences can be that some products either
do not meet or exceed current standards for other similar
products within related industries. For example, some
manufactured edible cannabis products that are being sold to
patients may not have gone through the same stringent food
retail and safety standards as other foods, which may risk
harm for consumers. While some facilities may test their
products for mold, pesticides, or contaminants, without
licensing or certification standards for that testing, the
same product at two different locations can yield vastly
different results, which pose risk of harm to consumers,
especially when dealing with patients who may be
immunosuppressed or otherwise vulnerable. In addition,
medical cannabis cultivation has recently received significant
attention within the media because of its utilization of
scarce water supplies in the midst of a drought and associated
environmental impacts from water diversion and pesticide use.
The author's proposed regulatory structure would fund
enforcement of existing standards, while also requiring
legitimate licensees to comply with state and local
environmental regulations.
Due to the lack of regulation, some actors have also been
encouraged to operate at the edge of the law and in the grey
area between state and federal rules. This has reduced
consumer protections, worker protections, impacted business
operations, and even banking services, to name just a few
areas which have been harmed by regulatory uncertainty.
Furthermore, the lack of statewide standards regarding
suitability for receiving a license, when combined with a
patchwork of local ordinances that have made it difficult for
legitimate operators to engage in business above board, and
AB 34
Page 38
provided a competitive advantage to the black market
operators. Without such standards, there are no market
controls, and no standards for consume protection. While
there have been some moves towards self-regulation, such as
the development of testing laboratories which work solely on
medical cannabis, by and large the legal uncertainty has
severely hindered protection of the public welfare. There is
also the harm and the threat of federal action looming over
California patients and practitioners until the state has
enacted the comprehensive and robust regulatory system as
demanded in the Cole Memo described above. Until such a
comprehensive regulatory scheme is enacted, the medical
marijuana industry will continue to swing between two
unacceptable extremes of having no oversight or regulations,
to being subject to federal action despite compliance with
local laws. According to the author, only comprehensive,
rigorous regulations for medical cannabis will overcome
potential harm to consumers and the industry.
AB 34 Licensing and Regulatory Framework. This bill will
address the above concerns by doing all of the following:
Establishing a comprehensive licensure and regulatory
scheme for medical cannabis activities, including for
dispensaries, wholesalers, manufacturers, and testing
laboratories, including minimum standards for operation.
Requires the Division of Medical Cannabis Regulation and
Enforcement to lead all state and local authorities
AB 34
Page 39
regarding the tracking of medical cannabis, medical
cannabis products and licensees.
Establishes standards for manufacturers, testing, and
certification of testing laboratories for medical cannabis,
including establishing product labeling and packaging
standards for cannabis products, and establishing consumer
protection, food and product safety requirements, including
those relating to dosage and sanitation, and testing for
potency and for bacteria, yeast, and mold.
Establishes standards for cultivators, including meeting
regulations to ensure that commercial cannabis activity
does not threaten the state's clean water and environment.
Ensures patient access to care by establishing a
provisional license program, continuing to exempt patients
and caregivers, and establishing tiered licensing schemes
to accommodate different levels and types of activities.
Maintains local authority by prohibiting persons from
engaging in commercial cannabis activity unless the person
obtains permission from local authorities.
Establishes a grant program to allocate monies to state
and local entities for purposes of assisting with
regulation and enforcement.
AB 34
Page 40
According to the author, while many of these standards are for
the health and safety of the public, arguably if all were
implemented it would go beyond freedom from harm and instead
improve the lives of patients and the public. These proposals
would also allow a vast and economically vibrant industry to
thrive in a regulated fashion protected from the federal
government. The economic benefits from this
regulation-stimulating the local and state economy, providing
significant tax revenues, and helping patients live more
productive lives-are above and beyond the protections provided
by these regulations.
Marijuana Frameworks Established in Other States. California
is the only state that permits for medical marijuana in the
absence of a robust state-wide regulatory system. The
following states have state-wide medical marijuana regulatory
systems: Alaska, Arizona, Colorado, Washington DC, Delaware,
Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan,
Minnesota, Montana, Nevada; New Hampshire, New Jersey, New
Mexico, New York, Oregon, Rhode Island, Vermont and
Washington. In addition, Colorado, Washington and Oregon have
established recreational marijuana licensing schemes.
Both Washington and Colorado have created systems of legal
production and sale, subject to licensing, regulation and
taxation. However, the laws impose different industry
structures and build on their existing medical systems in
different ways. Colorado allows entrepreneurs to produce
cannabis and sell it at retail, and such businesses are, at
least initially, required to produce the majority of the pot
they sell (vertical integration), while Washington state
maintains clear separation between pot growers, processors and
retailers (horizontal integration). Both models seek to,
AB 34
Page 41
however, reduce diversion and increase accountability. In
addition, the commercial market in Washington is supervised by
the Washington State Liquor Control Board, while Colorado's
law vests authority to regulate the commercial market in the
newly created Marijuana Enforcement Division of the Department
of Revenue. Colorado's medical marijuana program is also
under that Division - prior to the recreational initiative,
the Medical Marijuana Enforcement Division was regulating that
part of the market.
According to the Brookings Institution, since the early 1990s,
U.S. public opinion has trended in favor of marijuana
legalization. Currently, a majority of Americans support
legalization by a margin of seven points-52 percent to 45
percent, according to findings from a Pew Research Center
survey in March 2013. Support for marijuana legalization has
risen sharply since 2010, by 11 percentage points. This
increasing support for marijuana legalization is present in
California as well, with recent polls showing that a majority
of Californians support marijuana legalization. There are an
estimated four different marijuana initiatives attempting to
qualify for the 2016 ballot. In order for any marijuana
scheme to be effective, it should address all parts of the
industry, including establishing a robust licensing and
regulatory scheme, a taxation scheme, incorporate health and
safety standards, in addition to ensuring that the public is
protected; however, if the measure is too prescriptive, it may
hamper the ability to address any unintended consequences or
fill in any policy gaps without having to go back to the
ballot. As a result, if the State is able to create a
comprehensive framework for medical marijuana, it may also
serve a dual role by serving as a basis for a recreational
marijuana scheme.
1)Current Related Legislation. AB 26 (Jones-Sawyer) of the
current legislative session, would enact the Medical Cannabis
Regulation and Control Act to license and regulate medical
AB 34
Page 42
cannabis, and would create the Division of Medical Cannabis
Regulation and Enforcement within the Department of Alcoholic
Beverage Control to administer the act. (STATUS: This bill is
in the Assembly Business and Professions Committee.)
AB 34 (Bonta) of the current legislation, session would enact
the Medical Cannabis Regulation and Control Act to license and
regulate medical cannabis, and would establish the Division of
Medical Cannabis Regulation and Enforcement within the
Department of Alcoholic Beverage Control to administer the
act. (STATUS: This bill is in the Assembly Business and
Professions Committee.)
AB 243 (Wood) of the current legislation session, would
require all medical marijuana cultivation (MMC) to be
conducted in accordance with state and local laws and best
practices, as specified, and would require state agencies to
address environmental impacts of MMC and coordinate with local
governments in enforcement efforts, and establishes a MMC
permitting system. (STATUS: This bill is in the Assembly
Environmental Safety and Toxic Materials Committee.)
SB 673 (McGuire) of the current legislation session, would
establish within the Department of Consumer Affairs a Bureau
of Medical Marijuana Regulation, under the supervision and
control of the Chief of the Bureau of Medical Marijuana
Regulation, and would require the bureau to license and
regulate dispensing facilities, cultivation sites,
transporters, and manufacturers of medical marijuana and
medical marijuana products, subject to local ordinances, and
enforced primarily at the local level. (STATUS: This bill is
in the Senate Governance and Finance Committee.)
2)Prior Related Legislation. AB 1262 (Correa) of 2014, would
have established a licensing and regulatory framework for the
cultivation, processing, transportation, testing,
AB 34
Page 43
recommendation and sale of medical marijuana to be
administered by the Department of Consumer Affairs (DCA) and
enforced primarily at the local level. (NOTE: This bill was
held in the Assembly Appropriations Committee.)
AB 1894 (Ammiano) of 2014, would have enacted the Medical
Cannabis Regulation and Control Act to license and regulate
the cultivation, manufacture, testing, transportation,
storage, distribution, and sale of medical cannabis, and would
create the Division of Medical Cannabis Regulation and
Enforcement within the Department of Alcoholic Beverage
Control. (NOTE: This bill was held on the Assembly Floor.)
AB 473 (Ammiano) of 2013, would have enacted the Medical
Marijuana Regulation and Control Act to license and regulate
the cultivation, manufacturing, testing, transportation,
distribution, and sales of medical marijuana and medical
marijuana products, and would create the Division of Medical
Marijuana Regulation and Enforcement within the Department of
Alcoholic Beverage Control. (NOTE: This bill was held on the
Assembly Floor.)
AB 604 (Ammiano) of 2013, would have enacted the Medical
Cannabis Regulation and Control Act to license and regulate
the cultivation, manufacture, testing, transportation,
storage, distribution, and sale of medical cannabis, and would
create the Division of Medical Cannabis Regulation and
Enforcement within ABC. (NOTE: This bill was held in the
Senate Public Safety Committee.)
AB 2312 (Ammiano) of 2012, would have established the Medical
Marijuana Regulation and Control Act, authorizing local taxes
on medical cannabis and creating a board to regulate the
medical cannabis industry. (NOTE: This bill was held in the
Senate Committee on Business, Professions and Economic
Development.)
AB 34
Page 44
SB 1182 (Leno) of 2012, would have provided that a cooperative
or collective that operates within the Attorney General's (AG)
guidelines shall not be subject to prosecution for marijuana
possession or commerce, as specified. (NOTE: This bill was
held on the Senate Floor.)
AB 1300 (Blumenfield), Chapter 196, Statutes of 2011, provided
that a local government entity may enact an ordinance
regulating the location, operation or establishment of a
medical marijuana cooperative or collective; authorizes local
government entities to enforce such ordinances through civil
or criminal remedies and actions; and authorizes a local
government entity to enact any ordinance that is consistent
with the Medical Marijuana Program.
SB 626 (Calderon) of 2011 would have required the Board of
Equalization (BOE) to establish a nine-member task force to
conduct a study to determine ways to enhance collections of
sales and use taxes on retail sales of marijuana and ensure
proper regulation of the cultivation, transportation, and
distribution of marijuana and marijuana products. (NOTE: This
bill was held in the Senate Appropriations Committee.)
AB 390 (Ammiano) of 2009, would have legalized the possession,
sale, cultivation and other conduct relating to marijuana and
required the Department of Alcoholic Beverage Control to
administer and enforce the terms of legalized marijuana.
(NOTE: This bill was held in the Assembly Health Committee.)
SB 420 (Vasconcellos), Chapter 875, Statutes of 2003,
established the Medical Marijuana Program Act, a statewide,
voluntary program for the issuance of identification cards to
identify persons authorized to engage in the medical use of
marijuana under the Compassionate Use Act.
Proposition 215, of the November 1996 General Election,
prohibits prosecution for the possession and cultivation of
AB 34
Page 45
cannabis by a patient or a patient's primary caregiver with a
physician's written or oral recommendation.
ARGUMENTS IN SUPPORT
The Emerald Growers Association writes in support, "The bill
takes a measured approach to this complex public policy
challenge. AB 34 identifies regulatory agencies, calls on those
agencies to develop a system of licensure, and - most
importantly from our perspective-calls on the [CDFA] to take a
lead role regulating cultivation?.By referring many of the
specific details to future legislation and regulatory processes,
this bill empowers stakeholders to form stronger relationships
and gain a deeper understanding of other perspectives?There is
no other major industry in CA that is regulated entirely by one
agency and past attempts to fit the entire industry into the
oversight of a single industry have failed. The multi-agency
approach ensures that agencies are only responsible for
regulating things they are capable of regulating?.[This bill]
calls on the regulatory authorities to establish a tiered
licensing scheme to accommodate the different levels and types
of activity to be licensed. This will create opportunities for
small, medium, and large businesses to participate in the
regulated industry and ensure the most expeditious transition to
regulation with minimum disruption to regional economies."
United Food and Commercial Workers Union writes a letter in
support and states, "a 'cannabis worker apprenticeship program
and certification program' will ensure the rights of workers are
AB 34
Page 46
protected, health and safety standards are maintained and
ongoing product knowledge and skills development are sustained
with consistency throughout the cannabis industry similar to
pharmacy laboratory technicians, nursing assistants, dental
hygienists, physical therapists, and cosmetologists."
ARGUMENTS IN OPPOSITION
The League of California Cities writes in opposition: "Despite
provisions in the bill appearing to uphold local regulations,
the bill also contains provisions that clearly undermine the
power of local ordinances, setting the stage for future
litigation on this issue, should this measure be enacted
unchanged?.[C]onflicting provisions raise the question of
whether AB 34 is serious about upholding local control in the
context of a regulatory scheme for medical marijuana. First,
this measure places the [ABC] in overall charge of the
regulatory scheme?As a matter of policy, the League is convinced
that in a state the size of California, no state agency should
have the primary role of enforcement in the field of marijuana
regulation - the cost to the state will be excessive and the
enforcement in too many instances will be neither timely nor
AB 34
Page 47
sufficient ?.Second, there is no local licensing under AB 34's
regulatory scheme?Third, AB 34 authorizes locals to temporarily
suspend a license, but the authorization flows from
ABC?Fourth,?language calls into question the validity of
pre-existing local bans?.Each of these provisions sets the stage
for future litigation, pitting local governments against the
state, and against industry participants who have attempted to
set up shop in many of our cities in direct violation of local
ordinances."
The California Police Chiefs Association writes in opposition:
"[W]e do not believe that the ABC is an appropriate
administrative department for medical marijuana regulation. We
have serious concerns regarding the efficacy of state
enforcement and instead advocate for an enforcement structure
based off of local enforcement with state enforcement being
secondary. Furthermore, we do not believe that an agency with
profound experience in recreational substance has the
appropriate expertise to regulate a medical product?We believed
that AB 34 as currently constructed, erodes the authority of
cities and counties to prohibit medical marijuana operations in
their jurisdiction?AB 34 appears to downgrade drug trafficking
to a misdemeanor?"
POLICY ISSUES FOR CONSIDERATION:
This bill would establish a novel licensing and regulatory
AB 34
Page 48
scheme for medical cannabis, which covers nearly every aspect of
the medical cannabis industry, from seed to sale. To accomplish
this scheme, the bill creates three new divisions within three
different state departments, and carves out the responsibilities
and jurisdiction of each one. Wholesalers and dispensaries are
licensed under the Division of Medical Cannabis Regulation and
Enforcement (DMCRE), under the ABC; manufacturers and testing
laboratories are under the Division of Medical Cannabis
Manufacturing and Testing (DMCMT), under the CDPH; and
cultivators are licensed under the Division of Medical Cannabis
Cultivation under the CDFA, all collectively known as the
"regulatory authorities." Each of these newly-created divisions
have myriad duties involved in this comprehensive new scheme,
which include establishing new standards for licensure, in
addition to comprehensive health and safety and environmental
standards. Each division is responsible for enforcement of
their respective areas. As would be expected for any new
regulatory program of this scale and scope, let alone three new
programs, a number of outstanding issues and overarching
concerns should be addressed to ensure that this framework has
the greatest chance of success, the key of which is likely to be
coordination and collaboration among the regulatory authorities.
In addition, successful implementation of any medical cannabis
program will require strong leadership and involvement from the
Administration to prioritize implementation so that it meets
federal guidance and prevents the potential for illegitimate
activities; to coordinate efforts among all regulatory
authorities and other state entities that will play a role in
establishing a robust and effective licensing and regulatory
framework; and to ensure that all of the regulatory authorities
will have sufficient resources to ensure that staffing and other
needs will be met.
AB 34
Page 49
Division of Medical Cannabis Regulation and Enforcement (DMCRE)
Under the ABC. ABC has the exclusive right and power to license
and regulate the manufacture, importation, and sale of alcoholic
beverages. ABC is authorized 427 positions, organized into
three major division and twenty-four district offices, to
regulate the 87,112 ABC-licensed businesses. The licensing
section investigates all applicants and proposed business
locations to ensure they meet minimum qualifications, and may
examine police problems, over concentration of licensed premises
in the area, and the possible impact the proposed business will
have on nearby residences, churches, schools, and hospitals.
Currently, the ABC has over seventy licensing categories that
are established in statute. While most of the ABC authority for
licensure and enforcement is explicit in statute, the ABC has
the authority to promulgate rules to effectively implement its
mission and purpose.
ABC agents are peace officers and are empowered to investigate
and make arrests for violations that occur on or about licensed
premises. The ABC employs various methods of enforcement, often
collaborating with other agencies to enforce the provisions in
the ABC Act including minor-decoy operations, fake
identification stings known as "Operation Trapdoor," and
complaint-driven investigations. Agents are further empowered
to enforce any penal provisions of the law any place in the
State. However, the ABC relies on local law enforcement to
police the provisions within the ABC Act for approximately
40-50% of its enforcement functions. Regardless of the agency
filing the violation, licensees who violate state laws or local
ordinances are subject to disciplinary action and may have their
licenses suspended or revoked. These licensees are entitled to a
hearing before an Administrative Law Judge and an appellate
AB 34
Page 50
process to the State Supreme Court.
While it appears that the ABC has an infrastructure in place to
support these additional licensing and enforcement activities
relating to medical cannabis, the author may wish to consider
the extent to which the proposed licensing and enforcement
should parallel and be modeled after the licensure and
enforcement provisions for alcohol, particularly with regards to
local involvement during the licensure process, tiers of
licensure categories, and the number of licenses a licensee may
ahold across different activities. In addition, the author may
wish to specify the type of enforcement the ABC is intended to
have, and clarify the role of enforcement and sharing of
enforcement responsibility between ABC and local governments,
and whether the medical cannabis program should have a similar
appeals process.
In addition, the ABC's jurisdiction and operations are primarily
guided by statute; the ABC does not promulgate many of its
regulations. In light of the ABC's broad new jurisdiction under
this bill, the author should continue to build upon the
framework in this bill to ensure that the ABC's primary role is
in implementing these laws, and not creating policy with respect
to these laws. In addition, the author may wish to specify that
the DMCRE roles with respect to medical cannabis is to promote
patient safety and legitimate access to care.
AB 34
Page 51
Laboratory Certification. The DMCMT, under CDPH, would be
required to license and regulate manufacturers and testing
laboratories, in addition to establishing complex and
comprehensive health and safety standards, including standards
relating to product labeling, food and product safety
requirements, maximum potency for cannabinoids, sanitization
standards, and testing standards. Many of these areas build
upon the CDPH's existing jurisdiction and areas of expertise.
The CDPH operates some licensing and certification programs for
food and drugs under its Food and Drug Branch, establishes
health and safety standards under the Food Safety Program, and
is responsible for promulgating certification regulations and
certifies some laboratories.
The International Laboratory Accreditation Cooperation (ILAC) is
a well-respected industry organization that has several
accreditation bodies that are considered complaint with ISO/IEC
17011, which is the standard by which accreditation bodies are
to operate, and are qualified to attest that a laboratory meets
the standards found in ISO/IEC 17025 and ISO/EIC 17020 (which is
the visual inspection standard). For example, the American
Association for Laboratory Accreditation in Maryland is an
ILAC-approved accreditation body that has developed a Cannabis
Testing Laboratory Program specifically designed to raise the
standard in laboratory testing relating to medical marijuana.
As a result, the author should consider whether laboratory
certification using an outside accreditation body may be a more
appropriate or specify that DMCMT may rely upon an outside
accreditation body as part of its certification. The licensee
could then be charged with using a certified laboratory or face
sanctions for failure to comply with the requirement that an
accredited laboratory was utilized, thereby limiting the
administrative oversight of the division, is appropriate.
AB 34
Page 52
Establishing a Taskforce. Because the structure requires
multiple new divisions, each with oversight over their
respective licensees and possible overlap (because the licensing
structure does not limit the number of licensees an entity might
have), there will be a need for great communication and
collaboration among the regulatory entities and other state and
local entities that play a role in licensing and enforcement.
For example, if one entity took action against a licensee, that
action should be communicated to any other regulatory entity or
relevant local entity, and the possibility of joint enforcement
actions may be considered. The bill serves to create such
communication by, among other things, requiring the DMCRE to
serve as a repository of information for all licensees, and
requiring such actions to be reported to the DMCRE. In
addition, the bill requires regulations that set forth the
inspection and enforcement responsibilities of each relevant
state entity, and requires the regulatory authorities to enter
into an interagency agreement to set forth the duties of those
agencies under the Act and provide for reimbursement to the
appropriate state and local authorities of associated costs from
revenues deposited into the fees account of the fund.
To build upon these efforts to increase communication, ensure a
coordinated front, and reduce duplicative efforts, the author
may wish to consider establishing a taskforce to clarify the
appropriate roles of each state entity, and establish clear
communication and information sharing guidelines. Such a
taskforce could also bolster each regulatory authorities
regulatory efforts by inviting outside expertise, such as
including other environmental departments, medical cannabis or
industry experts, and local enforcement and licensing entities.
Other participants may also include the Board of Equalization
AB 34
Page 53
and the Attorney General, to help navigate state and federal
legal landscapes.
Information Database. The bill would require the DMCRE to lead
all state and local authorities regarding the tracking of
medical cannabis, medical cannabis products, and licensees
pursuant to the Act; maintain a registry of all licensees and
records of all licensees; maintain all electronic shipping
manifests; and share the above information with state and local
law enforcement. Based on the state's spotted history with
complex information technology projects, the author should
consider working early on with the ABC and other relevant state
entities to determine the feasibility, timeline, and cost to
establish a database system that would meet these new
requirements.
Multiple Licenses. Under the bill, licensees can hold multiple
license types, except it cannot combine a testing laboratory
with any other license. This approach is similar to Colorado's
approach, which initially required "vertical integration," or
requires businesses to be involved in all parts of the business
to get a license. This approach was thought to initially limit
the number of businesses, making it easier to control the
market, and allowed additional licensees to enter the market at
a later time. Washington, on the other hand, prohibited
"vertical integration" and instead only permitted business to
get licensed in one stage of production, similar, for the most
part, to the alcohol control model. The intent behind that
model was to avoid the creation of monopolies, and some also
believe that structure makes it harder to licensees to falsify
any data. Currently, the bill allows licensees to hold multiple
AB 34
Page 54
licensees, but does not require a licensee to be involved in all
parts of the business; instead, it allows for both types of
models. The author may wish to consider the benefits of both
approaches, and whether it may be beneficial at some point to
limit the number of licensees one can hold.
Use of Peace Officers. The bill provides that regulatory
directors and persons employed by the regulatory authorities for
the administration and enforcement of the Act are peace officers
in the enforcement of the penal provisions of the Act, the rules
of the division adopted under the Act, and any other relevant
penal provisions. While many state entities use sworn officers,
the language in the bill raises the question of whether all
persons employed by the divisions for administration and
enforcement need to be sworn officers. For example, ABC agents
are peace officers and are empowered to investigate and make
arrests for violations of the BPC that occur on or about
licensed premises, but less complex tasks, such as license
applications, are reviewed and processed by non-sworn licensing
representatives. The author may wish to clarify that the
regulatory authorities also rely on non-sworn personnel.
Enforcement. The bill vests primary responsibility to regulate
medical cannabis with the State, and requires each regulatory
authority to enforce their own provisions. However, the bill
also requires state agencies to collaborate with local agencies,
and local agencies, within the scope of their jurisdiction, and
to the extent resources are available, to assist state agencies
in the enforcement of the Act. In addition, the bill requires
the regulatory authorities to collaboratively establish and
administer a grant program to allocate moneys from the fines and
AB 34
Page 55
penalties account to state and local entities for the purpose of
assisting with medical cannabis regulation and the enforcement.
While the regulatory authorities are clearly tasked with
enforcement responsibilities, many of these entities work with
local law and code enforcement or local health and agricultural
offices to enforce health and safety and other standards. The
author may wish to consider clarifying these instances and
opportunities for collaboration.
Fund. While the bill authorizes regulatory authorities to
establish a fee for provisional licensees, it does not provide
any further guidance about how a regulatory authority can
support its startup costs. The author may wish to consider
whether the state entity housing each new division is able to
advance those startup costs as a loan. In addition, the author
should consider establishing a separate fee account for each
regulatory authority to enable it to deposit fees and penalties
it collects and to also draw upon those funds.
Appointments. Currently, the bill requires the Director or
Officer of each department to appoint a person to administer the
Act under each respective division. However, such appointments
are typically made by the Governor. The author may wish to
consider whether it may be more appropriate for the Governor to
make these appointments.
AMENDMENTS:
AB 34
Page 56
Local Control and Licensure. The bill specifically states in
numerous provisions that any licensing and regulatory structure
established under the bill does not affect a local government's
ability to enact or enforce local ordinances pursuant to Section
7 of Article XI of the California Constitution. However, there
are some places in the bill where this local authority could be
further clarified; as a result, the author may wish to consider
the following amendments:
On page 9, line 20, strike: exclusive and insert: primary
To clarify the type of documentation required to prove that an
applicant for state licensure has obtained local permission in
accordance with the Act, the author may wish to specify that the
documentation shall be issued by the local authority:
On page 30, line 11, after "shall" insert: shall be issued by
the local authority and
AB 34
Page 57
The author may wish to specify that a city or county may impose
a temporary local suspension of a licensee not only for a
violation of the Act, but also for a local ordinance, and
clarify that the ability to impose a temporary local suspension
does not limit a local government's authority to take other
enforcement action.
Section 26066(e): (e) A city, county, or city and county to
may impose a temporary local suspension of the license of a
commercial licensee for up to 30 days for violations of this
chapter or local ordinance . The regulatory authority shall
promptly cause an investigation to be made as to whether
grounds exist for continued suspension or revocation of the
license. If the regulatory authority has not completed its
investigation or disciplinary action within 30 days, a city,
county, or city and county may impose a subsequent temporary
local suspension of the license of a commercial licensee for
the same violation until the regulatory authority's
investigation, suspension or revocation , and all appeals to
that suspension or revocation are complete. This subdivision
shall not limit a city, county, or city and county's authority
to enforce other laws or ordinances pursuant to the authority
granted by Section 7 of Article XI of the California
Constitution .
.
Existing law provides that the immunity that applies to
qualified patients and primary caregivers who "collectively or
cooperatively" associate to cultivate medical marijuana shall
not solely on the basis of that fact be subject to specified
criminal sanctions. The bill provides that six months after the
AB 34
Page 58
issuance of provisional licenses pursuant to the Act, this
immunity shall no longer be available to licensees under the
Act, who are specifically provided immunity under Section 26049.
To clarify, however, that the existing exemption for
collectives and cooperatives also does not extend beyond that
time, the author may wish to consider making the following
changes:
On page 46, line 26, insert: Subject to subdivision (b ),
On page 46, line 38, after "act" insert: or to any persons who
collectively or cooperatively cultivate marijuana for medical
purposes
Because California law prohibits any medical marijuana facility
from being located closer than 600 feet to a school, the author
may wish to consider providing evidence of meeting this
requirement as part of the licensure process, to quickly
eliminate facilities that are not operating in accordance with
existing law.
On page 31, line 24, after "location" insert: including, if
the proposed facility is a cultivator or a dispensary, that
AB 34
Page 59
the proposed facility is located beyond at least a 600-foot
radius from a school,
This bill seeks to provide some flexibility to a regulatory
authority when determining whether a license may be denied by
allowing the regulatory authority to place reasonable conditions
upon licensure to address any concerns. However, the bill does
not prohibit the waiver of a specified condition, Section
26040(b)(6), which deals with security requirements. Upon
discussion with the author's office, the reference was intended
to refer to Section 26047(e)(10), which prohibits licensure if
an applicant has been sanctioned for unlicensed medical cannabis
activities or has had a licensed revoked. The author should
make the following change:
On page 33, line 1, strike: paragraph (6) of subdivision (b)
of Section 26040 and insert paragraph (10) of subdivision (e)
The author may also wish to clarify that the conditions for
which a license may be denied also may serve as a reason to
suspend or revoke a license.
On page 33, line 4, after "renewal" insert: or suspend or
AB 34
Page 60
revoke a license .
The author may wish to clarify that a regulatory is only
required to issue a provisional license if the applicant meets
all of the requirements in those provisions.
On page 37, line 7, after "shall" insert: if the applicant
meets all the requirements in this section, "
Department of Consumer Affairs (DCA). The DCA issues licenses
in dozens of business and professional categories, including
doctors, dentists, contractors, cosmetologists and automotive
repair facilities. The DCA includes 41 regulatory entities (25
boards, nine bureaus, four committees, two programs, and one
commission). These entities establish minimum qualifications
and levels of competency for licensure. The DCA's area of
expertise includes professional licensure and regulation,
primarily of licensed professionals, and the DCA's oversight is
typically over fragmented chunks of licensed professionals, as
opposed to entire swaths of industries. While the bill
currently requires the DCA to play a role under the new
licensure and regulatory structure, particularly with respect to
the certification and licensing of testing laboratories, this
responsibility is not one that is typically within the DCA's
purview. As a result, the author may wish to consider
eliminating the DCA from the bill.
AB 34
Page 61
On page 9, line 40, strike: the Director of Consumer Affairs ,
Recordkeeping and Auditing. Under the bill, the DMCRE would be
responsible for, among other things, maintaining a registry of
all licensees and a record of all medical cannabis commercial
activity. The bill also prohibits licensees from interacting
with non-licensed entities. To ensure that licensees will be
able to easily determine whether they are engaging with a
licensed entity in compliance with the Act, the author may wish
to specify that licensees are able to obtain such information.
On page 13, at the end of line 22, add: The division shall
make limited licensee information available to a licensee so
that it may verify whether it is engaging in commercial
cannabis activities with a properly licensed entity .
With regards to auditing requirements, the author may wish to
specify that the DMCRE has the discretion to determine the type
of annual audit required, instead of requiring the State Auditor
to conduct annual audits of all licensees and that licensees are
responsible for those audit costs.
AB 34
Page 62
On page 35, line 38, strike " by the State Auditor " and insert:
as specified by the regulatory authority ," and at the end of
line 39, insert: The reasonable costs of the audit shall be
paid for by the licensee .
Fees and Funds. Currently, the bill has unspecified amounts for
various licensure fees and for fees and penalties. The author
may wish to consider specifying that any license fee shall be
limited to the reasonable regulatory costs incurred by the
regulatory entity, and establishing a penalty based on the
amount of the fee.
On page 14, lines 4-5, strike ___dollars ($____) for an
initial application, and line 5 ____dollars ($____) for a
renewal application and insert: the reasonable regulatory
costs to the regulatory authority
On page 14, lines 13-14, strike: be less line 14 than ____
dollars ($____), nor more than ____ dollars ($____) and
insert: exceed the reasonable regulatory costs to the
regulatory authority "
AB 34
Page 63
On page 36, line 27, strike ____ dollars ($____) and insert:
the reasonable regulatory costs to the regulatory authority
On page 40, line 17, strike: ____ dollars ($____) and insert:
two times the amount of the license fee
In addition, the bill currently requires all fees collected
pursuant to the Act to be deposited into the fees account,
established within the Medical Cannabis Control Fund, to be
appropriated to the DMCRE for costs incurred. Because other
regulatory entities will also be collecting fees and incurring
costs relating to licensees under their respective jurisdiction,
the author may wish to specify that the fees may be appropriated
to the appropriate regulatory authority. In addition, the
author may wish to clarify in the future each specific fee
account that should be created to simplify this process.
On page 20, lines 9-10, strike: Division of Medical Cannabis
Regulation and Enforcement and insert: appropriate regulatory
authority
AB 34
Page 64
On page 20, line 12, strike: division and insert: regulatory
authority
Duties of the California Department of Food and Agriculture. To
make clear that while the Division of Medical Cannabis
Manufacturing and Testing is the one establishing requirements
for testing standards, that cultivation licensees under the
Division of Medical Cannabis Cultivation are still required to
follow those standards, the author may wish to add the following
provision:
On page 16, line 8, insert: In consultation with the State
Department of Public Health, establish testing standards for
medical cannabis .
The CDFA is organized into six divisions, which include the
Inspection Services Division, which inspects crops to ensure
that they are safe, abundant, quality food supply and
environmentally sound agricultural practices, and the Division
of Measurement Standards, which ensure the accuracy of
commercial weighing and measuring devices. This bill specifies
various duties under the regulatory entities, including
requiring the Division of Medical Cannabis Manufacturing and
Testing to, among other things, ensure that cultivation
licensees have access to agricultural support programs and
conform with weighing or measuring standards and standards
controlling the application of pesticides. Because these
AB 34
Page 65
provisions are typically with the CDFA's jurisdiction, the
author should consider reassigning those responsibilities to the
Division of Medical Cannabis Cultivation under the CDFA.
On page 17, strike lines 35-39, and on page 18, strike lines
1-5 and lines 30-31.
On page 16, line 8, insert: (e) Ensure cultivation licensees
have access to existing agricultural incentive and support
programs.
(f) Weighing or measuring standards, including, but not
limited to, the requirement that devices used in connection
with the sale or distribution of cannabis meet standards
equivalent to Division 5 (commencing with Section 12001) of
the Business and Professions Code.
(g) Standards controlling the application of pesticides. These
standards shall, at a minimum, require that if pesticides are
to be used, the use comply with standards equivalent to
Division 6 (commencing with Section 11401) of the Food and
Agricultural Code and its implementing regulations ."
AB 34
Page 66
Health, Safety, and Testing Standards. The author may wish to
clarify that edible medical cannabis products may be regulated,
and do not have to be summarily destroyed as an adulterated
product.
On page 17, at the end of line 25, insert: For purposes of
this chapter, edible medical cannabis products are deemed to
be unadulterated food products .
In addition, the author may wish to consider specifying that in
addition to a testing laboratory having to use methods
established by the International Organization for
Standardization, specifically ISO/IEC 17025, that laboratories
should also use ISO/EIC 17020, which is the visual inspection
standard.
On page 18, line 29, after "ISO/IEC" insert: 17020 and
In addition, in Section 46041(e)(5), the author may wish to
AB 34
Page 67
conform testing standards for wholesale licensees with testing
standards for other licensees.
(5) Require that all medical cannabis and medical cannabis
products be tested by a laboratory that has been certified and
licensed pursuant to this chapter the wholesale licensee prior
to commercial exchange with a dispensary. If the licensee has
a separate dispensary license, all medical cannabis and
medical cannabis products must be tested by a laboratory that
has been certified and licensed pursuant to this chapter,
prior to retail directly to consumers .
Security Standards. Under the bill, dispensaries are required
to "maintain dedicated, licensed security staff both inside and
outside the dispensary." Because this requirement might be
overly burdensome for small dispensaries, which may not pose as
great of a risk, the author may wish to consider the following
change:
On page 19, line 20, strike: both inside and outside the
dispensary " and insert: as deemed appropriate by the division
The bill currently requires the DMCRE to keep a complete record
AB 34
Page 68
of all entities licensed pursuant to the Act, and to make that
record available on the DMCRE's website to state and local law
enforcement to verify a mandatory commercial license. To
address potential security concerns with publishing sensitive
information on online, the author may wish to delete the
requirement that the information be provided online.
On page 41, line 15, strike: on the division's Internet Web
site so as and strike permit
Labeling Standards. The bill would require, among other things,
that medical cannabis products, including edibles, be labeled
and include specified information, such as a list of cannabinoid
content and dosage. Because medicinal cannabis varies in terms
of the levels and types of active ingredient, for example, and
what it is used for varies among patients, it may be difficult
to develop a standard "dosage" for products. As a result, the
author may wish to consider clarifying labeling standards with
regards to medical marijuana products and requiring products to
instead state the amount of cannabinoid per milligrams in each
serving, and the total amount in a package. The author should
also include a warning to let consumers know that the
intoxicating effects of edible medical marijuana products may be
delayed to prevent consumers from consuming more than is
necessary to alleviate symptoms.
On page 17, lines 1-2, strike: dosage in total milligrams of
AB 34
Page 69
cannabinoids delivered, and and insert on line 2, after
"allergens": and the amount in milligrams of cannabinoids per
serving, servings per package, and the amount in milligrams of
cannabinoids in the total package "
REGISTERED SUPPORT:
American Nurses Association\California
Conscious Cannabis Ventures
Emerald Growers Association
Heritage Associates
United Food and Commercial Workers Union
1 owner of a cannabis dispensary
REGISTERED OPPOSITION:
Association for Los Angeles Deputy Sheriffs
AB 34
Page 70
Association of Deputy District Attorneys
California Association of Code Enforcement Officers
California Narcotics Officers' Association
California Police Chiefs Association
California College and University Police Chiefs Association
California Correctional Supervisors Organization
City of Concord
City of Tulare
Family Winemakers of California
International Faith Based Coalition
League of California Cities
Los Angeles Police Protective League
Riverside Sheriffs Association
AB 34
Page 71
Analysis Prepared by:Eunie Linden / B. & P. / (916) 319-3301,
Christian Jagusch / B. & P. / (916) 319-3301