BILL ANALYSIS Ó AB 243 Page 1 Date of Hearing: April 28, 2015 ASSEMBLY COMMITTEE ON ENVIRONMENTAL SAFETY AND TOXIC MATERIALS Alejo, Chair AB 243 (Wood) - As Amended April 22, 2015 SUBJECT: Medical marijuana cultivation SUMMARY: Establishes new requirements for marijuana cultivation, requires medical marijuana cultivation to meet the requirements of state law, and requires coordination between the state and local governments to enforce medicinal marijuana cultivation. Specifically, this bill: 1) States the intent of the Legislature that the multiagency task force, the Department of Fish and Wildlife (CDFW), and the State Water Resources Control Board (Water Board) pilot project address the environmental impacts of cannabis cultivation and continue enforcement efforts on a statewide and permanent basis to ensure the reduction of the adverse impacts of marijuana cultivation on water quality and fish and wildlife throughout the state. 2) Requires indoor and outdoor medical marijuana cultivation to be conducted in accordance with state and local laws and best practices. 3) Requires the State Board of Forestry and Fire Protection, CDFW, the Water Board, the California regional AB 243 Page 2 water quality control boards (regional water boards), and traditional state law enforcement agencies to address environmental impacts of medical marijuana cultivation and to coordinate with local governments on enforcement efforts. 4) Requires a county, city, or city and county, by July 1, 2016, to adopt an ordinance to implement the requirements of the bill, or to adopt a resolution to opt out of being the responsible entity for implementation of the requirements of the bill. 5) Requires the Governor to designate an appropriate state agency to implement the requirements of the bill in each county, city, or city and county that adopts a resolution opting out of responsibility for implementation. 6) Requires all qualified medicinal marijuana patients and primary care givers cultivating marijuana pursuant to the Compassionate Use Act of 1996, and all qualified persons associated with legal medicinal marijuana cultivation, to obtain a permit to cultivate marijuana from the sheriff, chief of police, or other entity designated by the county, city, or city and county, or designated state agency, that specifies location and number of plants grown at that location. Authorizes the county, city, or city and county or designated state agency to charge an administrative fee to cover the costs of permit issuance. 7) Requires the county, city, or city and county to establish the limit on the number of plants that may be cultivated on an outdoor parcel or indoor facility in areas zoned for marijuana cultivation. Sets, where a designated state agency is the responsible entity for implementation, AB 243 Page 3 the limit on marijuana plants at 99. 8) Prohibits outdoor marijuana cultivation from being within 100 feet of any occupied legal residential home or of a school offering kindergarten and grades 1-12, and authorizes a county, city, or city and county to increase the distance to up to one mile. 9) Requires all outdoor marijuana cultivations to be securely fenced with a fence not less than six feet tall, to be out of sight from the public, and to use lights that do not exceed 1,200 watts per 100 square feet of cultivation. 10) Prohibits marijuana cultivated at a residential home from exceeding the limit of plants established by the county, city, or city and county. Sets, where a designated state agency is the responsible entity for implementation, the limit on marijuana plants at 6, unless the county, city, or city and county adopts an ordinance setting a higher limit for indoor cultivation. 11) Prohibits indoor marijuana cultivation from being within 100 feet of a school offering kindergarten and grades 1-12, and authorizes a county, city, or city and county to increase the distance to up to one mile. 12) Requires all buildings where marijuana is cultivated or stored to be properly secured. AB 243 Page 4 13) Requires the county, city, or city and county or designated state agency to distribute zip ties for marijuana plant identification, and authorizes the county, city, or city and county or designated state agency to charge an administrative fee to cover the costs of issuing the zip ties, monitoring, tracking and inspecting the plants. 14) Requires a copy of a current and valid state-issued medical marijuana ID card or physician recommendation to be displayed at all cultivation sites. 15) Authorizes the county, city, or city and county or designated state agency to revoke or suspend a permit, deny the issuance of a permit, or impose fines for a violation. 16) States that the requirements of this bill do not apply to a qualified patient cultivating marijuana under the Compassionate Use Act of 1996 if he or she cultivates marijuana for his or her personal medical use and does not sell, distribute, donate, or provide marijuana to any other person or entity. 17) States that the requirements of this bill do not apply to a primary caregiver cultivating marijuana under the Compassionate Use Act of 1996 if he or she cultivates marijuana exclusively for the personal medical use of no more than five specified qualified patients. 18) States that the bill does not preclude a county, city, or city and county from regulating or banning the AB 243 Page 5 cultivation, possession, storage, manufacture, transport, provision, distribution, donation, or sale of marijuana, or any other activity or impair the enforcement of the same. 19) States thatrequirements of the bill do not apply to a county, city, or city and county that has an existing ordinance pertaining to the cultivation of marijuana, unless the county, city or city and county adopts an ordinance to implement the requirements of the bill. 20) Requires regional water boards and the Water Board to address waste discharges resulting from medical marijuana cultivation and associated activities, including adopting a general permit, establishing new waste discharge requirements, or taking action under existing waste discharge requirements. 21) Requires regional water boards to include conditions to address items such as: a) Site development and erosion control; b) Stream crossing installation; c) Soil damage; d) Water storage and use; e) Irrigation runoff; f) Fertilizers and soil; g) Pesticides and herbicides; AB 243 Page 6 h) Petroleum products and other chemicals; i) Cultivation-related waste; j) Refuse and human waste; and, aa) Cleanup, restoration and mitigation. EXISTING LAW: 1) Establishes the Compassionate Use Act of 1996 (Proposition 215), which authorizes the prescription, possession and use of medicinal marijuana. (Health and Safety Code (H&S) §11362.5) 2) Specifies that local governments may adopt local ordinances that regulate the location, operation, or establishment of a medical marijuana cooperative or collective. (H&S § 11362.83) 3) Pursuant to the Porter-Cologne Water Quality Control Act, governs water quality regulation in California by establishing a comprehensive program to protect water quality and the beneficial uses of water. (Water Code (WC) § 13000, et seq.) 4) Requires specified persons to file a report with the appropriate regional water board on waste discharge that could affect the quality of the waters of the state, other AB 243 Page 7 than into a community sewer system. (WC § 13260) 5) Permits the Water Board or regional water boards to waive discharge reporting requirements if the waiver is consistent with any applicable state or regional water quality control plan and is in the public interest. (WC § 13269) FISCAL EFFECT: Unknown. COMMENTS: Need for the bill: According to the author, "For the past 18 years, medical marijuana growers and medical marijuana patients have lived in a gray area where state and federal law are in direct conflict, which has prevented the establishment of reasonable environmental protections to already impacted watersheds. "Currently, there are very few environmental regulations for medical marijuana growers, which have caused unimaginable environmental damages to the North Coast region of the State... "The bill would also put in place basic regulations around the cultivation of medical marijuana. AB 243 establishes a program that allows for the tracking of medical marijuana plants. This will assist local law enforcement identify legal plants from the illegal ones quickly. The program allows an entity, designated by the local jurisdiction, to issue unique identifiers, such as a zip-tie, to farmers that seek to cultivate medical marijuana. A unique identifier would be issued for each plant that the farmer seeks to cultivate. "The Marijuana Watershed Protection Act, or AB 243, seeks to create a regulatory structure around a product that has never been regulated in our State." What's the problem: Many illegal, clandestine marijuana AB 243 Page 8 cultivation operations are tucked away in California's sprawling forest lands, mostly in Mendocino and Humboldt Counties. The United States Forest Service describes the extensive and alarming damage caused by "trespass grows" as having devastating impacts on the environment. The damages are due to illicit and uncontrolled use of pesticide and rodenticide applications; uncontrolled logging; wildlife habit destruction; illegal stream and river diversions for irrigation; and, chemical and solid waste discharges. The Water Board and the CDFW acknowledge that marijuana site cultivation on private and public lands cause enormous adverse effects to wildlife and their habitat. Marijuana cultivation activities can cause erosion and stream diversion. Unlawful water diversions can severely limit the amount of water available to people and wildlife, which is exacerbated during California's severe drought. (Lack of) marijuana regulation: Under current state law, there are no agricultural or environmental requirements explicitly for marijuana cultivation. Regulations for marijuana cultivation are still in their nascence, likely given how relatively recently medicinal marijuana became legalized in California. According to the research article "Impacts of Surface Water Diversions for Marijuana Cultivation on Aquatic Habitat in Four Northwestern California Watersheds," which includes contributions from CDFW, recent increases in the number and size of marijuana cultivation sites appear to be, in part, a response to ballot Proposition 215, the Compassionate Use Act (1996). In spite of state-wide prevalence, there is not yet a clear regulatory framework for the cultivation of marijuana, and from an economic viewpoint there is little distinction between plants grown for the black market and those grown for legitimate medical use. According to ArcView Group, a San Francisco-based marijuana research and investment firm, marijuana legalization "advocacy groups have already planned for legalization ballot initiatives AB 243 Page 9 in at least six states in 2016, including an Adult Use initiative in California. Should an Adult Use legalization initiative pass in California in 2016 the entire industry could rapidly double in size." ArcView Group's report, "3rd Edition of the State of the Legal Marijuana Markets," stated that the "largest medical market in the country, California, is no longer a model for medical cannabis legalization because of its lack of statewide regulation." The exponential growth in the demand for legal marijuana has pushed the demand for cultivation, thereby pushing the demand for regulation. In theory, regulations for legal cultivation will bring the illicit marijuana grows out of the shadows, which would help prevent the environmental problems marijuana cultivation currently present. Current efforts addressing environmental impacts of marijuana cultivation: The Water Board and CDFW proposed through the Governor's Office a pilot project to develop a focused enforcement effort regarding medicinal marijuana growers on private lands. The pilot project arose, in part, out of the rapid escalation of cannabis cultivation and proliferation of cultivation sites, primarily in Northern California. The Budget Act of 2014 (SB 852, Chapter 25, Statutes of 2014), appropriated resources for both CDFW and the Water Board to reduce environmental damage caused by marijuana cultivation on private and high value state-owned public lands in California. CDFW and the Water Board created a multi-disciplinary Marijuana Task Force, and began implementing a priority-driven approach to address the natural resources damages from marijuana cultivation on private lands in northern California and on high conservation value public lands. According to the Water Board and CDFW's joint report to the Legislature in January 2015, "The pilot project's initial effort is focused in the geographic area where CDFW and the Water Board have the greatest need, which are those counties covered by CDFW Regions 1 (Del Norte, Siskiyou, Modoc, Humboldt, Trinity, AB 243 Page 10 Shasta, Lassen, Mendocino, and Tehama), and Region 4 (Tuolumne, Stanislaus, Mariposa, Merced, Madera, San Benito, Fresno, Monterey, Kings, Tulare, San Luis Obispo, and Kern). These counties are covered by the Central Valley and North Coast Regional Water Quality Control Boards, and the State Water Resources Control Board's Division of Water Rights. The pilot project has four components: (1) the development of a regulatory program; (2) targeted enforcement in high value watersheds; (3) education and outreach to cultivators about best management practices; and (4) multi-agency coordination at the state and local level." Currently, the Water Board is in the process of promulgating a conditional waiver of waste discharge requirements ('permit') in both the North Coast and Central Valley Regions. A conditional waiver of waste discharge requirements will require all persons engaged in the activity of cultivating cannabis to enroll in the program, comply with terms and conditions and pay a fee. While the permits must undergo a public process before they can be adopted by the respective regional water boards, they are expected to contain such terms and conditions as, among others, a site operations plan, proper fuel storage and maintenance, appropriately sized and graded stream crossings, appropriately graded grow and structure pads, guidelines for fertilizer use and pest control and water conservation measures. Regional Water Boards: The Water Board has jurisdiction throughout California to protect water quality by setting AB 243 Page 11 statewide policy, and coordinating and supporting the regional water board efforts. There are nine regional water quality control boards that exercise rulemaking and regulatory activities by water basins. Though regional water boards have jurisdiction to oversee the protection of water quality, regulate discharge, and permit, as appropriate, waste discharges from various sources, not all are doing so as it relates specifically to marijuana cultivation. AB 243 creates a new mandate on regional water boards to specifically address specified conditions of marijuana cultivation similarly to what the Central Valley and North Coast Regional Water Quality Control Boards have accomplished under the aforementioned pilot program. Related legislation: AB 26 (Jones-Sawyer). Requires the Department of Alcoholic Beverage Control to promulgate regulations that, among other things, include requirements to protect the state's clean water and environment, including, but not limited to, protections related to land conversion, grading, water diversion and pond development, and agricultural discharges. This bill is pending before the Assembly Business & Professions and Health Committees. AB 34 (Bonta). Enacts the Medical Cannabis Regulation and Control Act, and would establish the Division of Medical Cannabis Regulation to, among other things, consult with the Department of Water Resources to adopt regulations to ensure that commercial licensed cannabis activity does not threaten the state's clean water and environment and is in compliance with the California Environmental Quality Act. This bill is set to be heard in the Assembly Business & Professions Committee on April 28, 2015. AB 243 Page 12 AB 266 (Cooley). Establishes a Bureau of Medical Marijuana Regulation to regulate marijuana cultivation, and, among other things, would also establish the Special Account for Environmental Enforcement to fund the enforcement of environmental regulations relating to licensed cultivation sites. This bill is set to be heard in the Assembly Business & Professions and Assembly Labor & Employment Committees. Double referral: This bill was double referred to the Assembly Agricultural Committee, where it passed out on April 15, 2015, on a 6 - 2 vote. REGISTERED SUPPORT / OPPOSITION: Support Associated Students of Humboldt State Universality California Association of Water Agencies California Narcotic Officer's Association California Cattlemen's Association California Forestry Association AB 243 Page 13 California Trout Central Coast Forest Association Conscious Cannabis Ventures County of Mendocino, Office of the Sheriff-Coroner Defenders of Wildlife Emerald Growers Association Heritage Associates Humboldt Redwood Company Sierra Club California Sonoma County Water Agency The Nature Conservancy Trout Unlimited Trust for Public Land AB 243 Page 14 Opposition None on file. Analysis Prepared by: Paige Brokaw / E.S. & T.M. / (916) 319-3965