BILL ANALYSIS                                                                                                                                                                                                    Ó



          SENATE COMMITTEE ON ENVIRONMENTAL QUALITY
                               Senator Wieckowski, Chair
                                 2015 - 2016  Regular 
           
          Bill No:            AB 243
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          |Author:    |Wood                                                 |
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          |Version:   |7/2/2015               |Hearing      | 7/15/2015      |
          |           |                       |Date:        |                |
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          |Urgency:   |Yes                    |Fiscal:      |Yes             |
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          |Consultant:|Rachel Machi Wagoner                                 |
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          SUBJECT:  Medical marijuana cultivation.

            ANALYSIS:
          
          Existing law:  

          1)Under the Compassionate Use Act of 1996, an initiative measure  
            enacted by the approval of Proposition 215 at the November 5,  
            1996, statewide general election, 

             a)   Authorizes the use and cultivation of marijuana for  
               medical purposes. 

             b)   Makes it a crime to plant, cultivate, harvest, dry, or  
               process marijuana, except as otherwise authorized by law. 

             c)   Qualified patients, persons with valid identification  
               cards, and the designated primary caregivers of qualified  
               patients and persons with identification cards, who associate  
               in order collectively and cooperatively to cultivate  
               marijuana for medical purposes, are not subject to criminal  
               sanctions solely on the basis of that fact.
          
          2)Under the Porter-Cologne Water Quality Control Act, the State  
            Water Resources Control Board (SWRCB) and the California  
            regional water quality control boards (regional boards) are the  
            principal state agencies with responsibility for the  
            coordination and control of water quality in the state.
           
           This bill:  







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          1) Establishes the Division of Medical Cannabis Cultivation  
             (division) in the Department of Food and Agriculture. 

          2) Authorizes a county, city, or city and county to issue or deny  
             a conditional permit to cultivate medical marijuana and would  
             require an applicant to obtain both a conditional permit from  
             the county, city, or city and county and a state medical  
             marijuana cultivation license from the division prior to  
             cultivation occurring. By increasing the duties of local  
             officials relative to issuing a conditional permit to cultivate  
             medical marijuana, the bill would impose a state-mandated local  
             program.

          3) Requires the division to implement an identification program  
             for medical marijuana in consultation with the State Water  
             Resources Control Board (SWRCB) and the Department of Fish and  
             Wildlife. 
             
          4) Authorizes the division to charge a fee to cover the reasonable  
             costs of issuing the unique identifier and monitoring,  
             tracking, and inspecting each medical marijuana plant. 

          5) Allows a county, city, or city and county to administer the  
             unique identifier program, in which case the bill would  
             authorize the county, city, or city and county, to charge a fee  
             to cover the reasonable costs of issuing the unique identifier  
             and monitoring, tracking, and inspecting each medical marijuana  
             plant. 

          6) Specifies that the unique identifier program established  
             pursuant the bill's provisions does not apply to a county,  
             city, or city and county that has an existing ordinance  
             pertaining to the cultivation of marijuana that provides for  
             the identification of individual plants during the cultivation  
             period.

          7) Imposes, on and after June 1, 2016, a tax on a licensed medical  
             marijuana cultivator, at the rate of $50 per medical marijuana  
             plant with a unique identifier. 

          8) Requires the tax to be administered by the State Board of  
             Equalization, as prescribed, and would require a licensed  
             medical marijuana distributor to collect the tax from the  








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             licensed medical marijuana cultivator and remit the amounts  
             collected pursuant to the procedures set forth in the Fee  
             Collection Procedures Law. By expanding the application of the  
             Fee Collection Procedures Law, a violation of which is a crime,  
             this bill would impose a state-mandated local program. This  
             bill would require all moneys less refunds, to be deposited  
             into the Marijuana Production and Environment Mitigation Fund,  
             which this bill would create in the State Treasury, and  
             continuously appropriate those moneys to the board for  
             allocation, as specified. The bill would require a licensed  
             medical marijuana cultivator to sell his or her medical  
             marijuana products only to a licensed medical marijuana  
             distributor, and would prohibit any other sales of medical  
             marijuana by a licensed medical marijuana cultivator. The bill  
             would also prohibit the sale of medical marijuana plants that  
             do not contain a unique identifier by a licensed cultivator to  
             a licensed distributor.

          9) Requires, on or before January 1, 2021, specified state  
             agencies, including, among others, SWRCB, the division, and the  
             Department of Justice, to submit reports to the Legislature  
             regarding implementation of the bill.

          10)Specifies that its provisions regarding the unique identifier  
             program and cultivation do not apply to certain qualified  
             patients cultivating marijuana if the patient cultivates  
             marijuana for his or her personal medical use and does not  
             sell, distribute, donate, or provide marijuana to any other  
             person or entity, or to certain primary caregivers cultivating  
             marijuana if the primary caregiver cultivates marijuana  
             exclusively for the personal medical use of no more than five  
             specified qualified patients for whom he or she is the primary  
             caregiver and who does not receive remuneration, except as  
             specified.

          11)Requires indoor and outdoor medical marijuana cultivation to be  
             conducted in accordance with state and local laws and best  
             practices related to land conversion, grading, electricity  
             usage, water usage, water quality, woodland and riparian  
             habitat protection, agricultural discharges, and similar  
             matters. This bill would require state agencies to address  
             environmental impacts of medical marijuana cultivation and  
             coordinate, when appropriate, with cities and counties and  
             their law enforcement agencies in enforcement efforts.








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          12)States the intent of the Legislature that the multiagency task  
             force, the Department of Fish and Wildlife and SWRCB pilot  
             project to address the Environmental Impacts of Cannabis  
             Cultivation, continue its enforcement efforts on a statewide  
             level and permanent basis.
          
          13)Requires each regional board, and allows SWRCB, to address  
             discharges of waste resulting from medical marijuana  
             cultivation and associated activities.
          
          14)Declares that it is to take effect immediately as an urgency  
             statute.
            
          Background
          
          1) The Compassionate Use Act (CUA) and SB 420.  In 1996, voters  
             approved Proposition 215, known as the Compassionate Use Act of  
             1996 (CUA).  The CUA 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) 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.  However, since the  
             passage of Proposition 215 and SB 420, the state has not  
             adopted a framework to provide for appropriate licensure and  
             regulation of medical marijuana.  In addition, despite the CUA  
             and SB 420, marijuana is still illegal under state and federal  
             law.  


          2) Local Authority Over Medical Marijuana.  By exempting qualified  
             patients and caregivers from prosecution for using or from  
             collectively or cooperatively cultivating medical marijuana,  
             the CUA and SB 420 essentially authorized the cultivation and  
             use of medical marijuana.  These laws have triggered the growth  
             of medical marijuana dispensaries in many localities, and in  
             response, local governments have sought to exercise 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  








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             marijuana activities, particularly relating to the ability to  
             control the zoning, operation, and existence of medical  
             marijuana dispensaries, the California Supreme Court (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 SB 420  
             expressly or impliedly limited the inherent authority of a  
             local jurisdiction, by its own ordinances, to regulate the use  
             of its land, including the authority to provide that facilities  
             for the distribution of medical marijuana will not be permitted  
             to operate within its borders.  Accordingly, many California  
             jurisdictions, roughly estimated by the League of California  
             Cities at 50% pending completion of a statewide survey, ban the  
             cultivation and sale of medical marijuana altogether.  



          3) Environmental Concerns.  According to some estimates, there are  
             30,000 cultivation sites in the tri-county area of  
             Humboldt-Mendocino-Trinity, and an additional 10,000 or more  
             cultivation sites elsewhere in California.  As a result,  
             California land, watersheds, and some species have been  
             significantly damaged by some cultivation operations.   
             "Trespass grows", which cultivate marijuana without permission  
             on public, tribal or privately owned land, have been associated  
             with wildlife poisoning, use and dumping of fertilizers and  
             pesticides, illegal water diversions and water pollution,  
             logging and land disturbance, and severe problems with garbage  
             and human waste.  These industrial-size marijuana grows, taking  
             place in the National Forests and on private timberland in some  
             of the state's most remote and ecologically sensitive areas,  
             are the subject of a recent study by the California Department  
             of Fish and Wildlife (CDFW), "Impacts of Surface Water  
             Diversions for Marijuana Cultivation on Aquatic Habitat in Four  
             Northwestern California Watershed," which showed that during  
             drought conditions, water demand for marijuana cultivation  
             exceeded stream flow in three of four study watersheds.  



             "Marijuana cultivation has proliferated in northwestern  
             California since at least the mid-1990s.  The environmental  
             impacts associated with marijuana cultivation appear  








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             substantial, yet have been difficult to quantify, in part  
             because cultivation is clandestine and often occurs on private  
             property?.."



             "We estimated water demand of marijuana irrigation and the  
             potential effects water diversions could have on stream flow in  
             the study water sheds.  Our results indicate that water demand  
             for marijuana cultivation has the potential to divert  
             substantial portions of streamflow in the study watersheds,  
             with an estimated flow reduction of up to 23% of the annual  
             seven-day low flow in the least impacted of the study  
             watersheds.  Estimates from the other study watersheds indicate  
             that water demand for marijuana cultivation exceeds streamflow  
             during the low-flow period.  In the most impacted study  
             watersheds, diminished streamflow is likely to have lethal or  
             sub-lethal effects on salmon and steelhead trout, which are  
             listed under the state and federal Endangered Species Acts, and  
             cause further decline of sensitive amphibian species."  


             In response, the Budget Act of 2014 appropriated resources for  
             both CDFW and the SWRCB to reduce environmental damage caused  
             by marijuana cultivation on private and high value state-owned  
             public lands in California.  A total of $3.3 million was  
             allocated to the two agencies to create a multi-disciplinary  
             Marijuana Task Force, and to implement 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.  This program was  
             authorized as a pilot program for five years. 

             Some organizations want to remedy the environmental effects of  
             past marijuana cultivation and regulate medical marijuana  
             cultivation more consistently throughout the state.
            
          Comments
          
          1) Purpose of Bill.  The author states that the cultivation of  
             marijuana has caused significant damage to California's natural  
             environment.  The potential for future damage is made all the  
             greater by the lack of regulation of the medical marijuana  
             industry, and in particular, the cultivation of medical  








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             marijuana.  According to the author, for the past 20 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.

             The author states that AB 243 creates a regulatory framework  
             around cultivation.  The unique identification program allows  
             for the tracking of medicinal marijuana plants to ensure that  
             marijuana is not being diverted to the black market and also  
             allows law enforcement to determine which plants are legally  
             being cultivated for medical purposes and which are being  
             illegally cultivated.  This enables swifter eradication actions  
             against illegal grows while avoiding the accidental  
             eradications of legal medicinal plantings.  

             Furthermore, the author asserts that AB 243 establishes a tax  
             that meets an urgent need for funding to address the impacts of  
             illegal marijuana cultivation.  The author believes that this  
             need is made all the more dire by the current drought, which  
             exacerbates the harm caused by the illegal diversion of water  
             to cultivate marijuana.   

          2) DOUBLE REFERRAL:  This measured was heard in the Senate  
             Governance and Finance Committee on July 8, 2015 and passed out  
             of that committee on a vote of 5-0.  The provisions of the bill  
             pertaining to relating to local agencies' permitting and land  
             use authority and taxation were considered by Senate Governance  
             and Finance Committee.

             The role of SWRCB and potential impacts to the environment are  
             within the jurisdiction of the Senate Environmental Quality  
             Committee.
            
          SOURCE:                    Author  

           SUPPORT:               
          California Trout
          California Cattlemen's Association
          California Narcotic Officers' Association
          Defenders of Wildlife
          Emerald Growers Association
          Green California
          Humboldt Redwood Company








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          Mendocino County Sheriff-Coroner, Thomas D. Allman
          Nature Conservancy
          Sierra Club California
          Sonoma County Water Agency
          Trout Unlimited
          Trust for Public Land

          OPPOSITION:

          Urban Counties Caucus
                                           
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