BILL ANALYSIS Ó
AB 266
Page 1
(Without Reference to File)
CONCURRENCE IN SENATE AMENDMENTS
AB
266 (Bonta, et al.)
As Amended September 11, 2015
Majority vote
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|ASSEMBLY: |62-8 |(June 4, 2015) |SENATE: | |(September 11, |
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(vote not available)
Original Committee Reference: B. & P.
SUMMARY: Establishes a comprehensive licensing and regulatory
framework for the cultivation, manufacture, transportation,
storage, distribution, and sale of medical marijuana (MM) to be
administered by the Department of Consumer Affairs (DCA),
Department of Food and Agriculture (CDFA), and Department of
Public Health (DPH), as specified.
The Senate amendments:
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Administration
1)Enact the Medial Marijuana Regulation and Safety Act (Act),
and establishes the Bureau of Medical Marijuana Regulation
(Bureau) within the DCA and confers upon the department the
sole authority to create, issue, renew, discipline, suspend,
or revoke licenses for the transportation, storage unrelated
to manufacturing activities, distribution, and sale of MM
within the state and to collect fees in connection with
activities the Bureau regulates.
2)Allows the Bureau to convene an advisory committee to advise
the Bureau and licensing authorities on the development of
standards and regulations, including best practices and
guidelines to ensure qualified patients have adequate access
to MM and MM products.
3)Requires DCA, CDPH, and the CDFA to promulgate regulations for
implementation of their respective responsibilities in the
administration of the Act.
Enforcement
4)Specify that grounds for disciplinary action include: failure
to comply with provisions in this bill or any rule or
regulation adopted regarding MM, conduct that constitutes
grounds for denial of licensure, other grounds contained in
regulations adopted by licensing authorities, and failure to
comply with state law.
5)Allow licensing authorities to take disciplinary action
against a licensee for any violation of any provision in this
bill. Require a licensing authority to inform the Bureau upon
suspension or revocation of a license.
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6)Provide that nothing shall be interpreted to supersede or
limit existing local authority for law enforcement activity,
enforcement of local zoning requirements or local ordinances,
or enforcement of local permit or licensing requirements, or
to require the DCA to undertake local law enforcement
responsibilities, local zoning requirements, or local
licensing requirements.
7)Authorize a city, county, or city and county to adopt
ordinances that establish additional standards for local
licenses and permits for commercial cannabis activity.
8)Provide that for facilities issued a state licensed located
within the incorporate area of a city, that the city shall
have full power and authority to enforce these provisions, if
so delegated by the State.
9)Provide that the city shall further assume responsibility for
any regulatory function relating to those licensees within the
city limits that would otherwise be performed by the county,
or any county officer or employee, including a county health
officer, without liability, cost, or expense to the county.
10)Provide that the actions of a licensee, that are permitted
pursuant to both a state license and a license or permit
issued by a local jurisdiction and conducted in accordance
with the requirements of the Act are not unlawful under state
law, as specified.
11)Require all persons engaging in commercial MM activity
without a license to be subject to civil penalties of up to
twice the amount of the license fee for each violation.
Licensure
12)Require the DCA to issue state licenses for dispensaries,
distributors, transporters, and special dispensary status, as
specified.
13)Prohibit a person from engaging in commercial cannabis
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activity without possessing both a state license and a local
permit or other authorization upon the date of implementation
of regulations by the licensing authority.
14)Specify that revocation of a local license, permit, or other
authorization and revocation of a state license shall
terminate a licensee's ability to operate within the state
until the local jurisdiction or licensing authority reinstates
or reissues the state or local license, permit, or other
authorization.
15)Provide that a facility or entity that is operating in
compliance with local zoning ordinances and other state and
local requirements on or before January 1, 2018, may continue
its operations until its application for licensure is approved
or denied.
16)Provide that issuance of a state license or determination of
compliance with local law by a licensing authority shall in no
way limit the ability of the City of Los Angeles to prosecute
any person or entity for a violation of, or be deemed to
establish satisfying the immunity requirements of Proposition
D, approved by the voters of the City of Los Angeles on May
21, 2013, ballot for the city, or local zoning laws.
17)Until January 1, 2026, prohibits a licensee from holding more
than one license except as follows:
a) A licensee may hold a small cultivation license and a
manufacturer license;
b) A licensee may hold a manufacturer license and a
dispensary license, limited to three retail sites;
c) A licensee may hold a small cultivation license and a
dispensary license, limited to three retail sites;
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d) A licensee may hold a distribution license and a
transporter license, if so authorized.
e) A dispensary licensee, limited to three retail sites,
may apply for a manufacturer license and hold a cultivation
license if it is not cultivating more than four acres.
18) Until January 1, 2026, exempt from the above licensing
restrictions business that were authorized by a local
jurisdiction, prior to July 1, 2015, to engage in multiple
cannabis activities, as specified.
19)Repeal existing statute allowing qualified patients and
designated primary caregivers to collectively or cooperatively
cultivate MM for medical purposes one year after the Bureau
posts on its Internet Web site that licensing authorities have
commenced issuing licenses pursuant to the Act.
Health and Safety Provisions
20)Require all licensees holding cultivation or manufacturing
licensees to send all medical cannabis and medical cannabis
products to a distributor for quality assurance and inspection
by the distribution licensee and for batch testing by a
testing licensee prior to distribution to a dispensary.
21)Require a licensee holding a dispensary license, in addition
to a cultivation or manufacturing license, to send all medical
cannabis or medical cannabis products to a distribution
licensee for presale inspection and for a batch testing by a
testing licensee prior to dispensing any product.
22)Require all medical cannabis and medical cannabis products,
upon issuance of a certificate of analysis by a testing
licensee, to undergo a quality assurance review by a
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distribution licensee prior to distribution, to ensure the
quantity and content of the medical cannabis or medical
cannabis product, and for tracking and taxing purposes by the
state.
23) Require all licensed cultivators and manufacturers to
package all medical cannabis and medical cannabis products in
tamper-evident packaging and to use a unique identifier to
identify and track the product, and requires the product to be
labeled as specified.
24)Require the DPH to promulgate regulations governing the
licensing of MM manufacturers and testing laboratories.
25)Require medical cannabis products to be labeled and in
tamper-evident packages, and prohibits MM packages and labels
from being made to be attractive to children. Requires MM
product labels to include, but not be limited to, the
following statements: "Keep out of reach of children and
animals"; "For medical use only"; "The intoxicating effects of
this product may be delayed by up to two hours"; and warnings
if nuts or other known allergens are used.
26)Require the Bureau to establish minimum security requirements
for the commercial transportation and delivery of medical
cannabis and products, and require a licensed dispensary to
implement security measures to deter and prevent unauthorized
entrance into areas containing, or theft of, medical cannabis
or medical cannabis products. Require a dispensary to notify
the licensing authority and appropriate law enforcement
authorities within 24 hours after discovering, among other
things, breaches of security.
Other
27)Require, beginning March 1, 2023, and on or before March 1
of each following year, each licensing authority to prepare
and submit to the Legislature an annual report on the
authority's activities and post it on its Internet Web site,
as specified.
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28)Require the Bureau to contract with the California Marijuana
Research Program, known as the Center for Medicinal Cannabis
Research, to develop a study that identifies the impact that
MM has on motor skills.
29)By January 1, 2017, require the Division of Occupational
Safety and Health to convene an advisory committee to evaluate
whether there is a need to develop industry-specific
regulations related to the activities of licensed facilities.
30) Require the State Board of Equalization, in consultation
with CDFA, to adopt a system for reporting the movement of
commercial cannabis and cannabis products through the
distribution chain, as specified.
31)Provide that the provisions of this bill are severable of any
provision or its application is held invalid.
32)Make the bill operative only if AB 243 (Wood) and SB 643
(McGuire) of the current legislative session is enacted and
takes effect on or before January 1, 2016.
FISCAL EFFECT: Unknown. This bill is keyed fiscal by the
Legislative Counsel.
COMMENTS:
Purpose. This bill is author sponsored. According to the
author, "After nearly 20 years of access to medical marijuana
without a reasonable framework for distribution, it is time for
us to take a serious look at putting such a framework into
place, whether voters are called upon to decide on legislation
in 2016 or not. Periodic litigation and the lack of uniform
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health and safety standards are just two examples of how the
status quo has not served the general public or patients with
bona fide medical needs well."
This bill is drafted to work in conjunction with AB 243 (Wood)
and SB 643 (McGuire) of the current legislative session, and is
contingent upon the enactment of both of those bills.
The Compassionate Use Act (CUA) and SB 420 (Vasconcellos),
Chapter 875, Statutes of 2003. 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. However, since the passage of Proposition 215
(1996) and SB 420, 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 the
creation of a patchwork of local 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
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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
Cannabis. By exempting qualified patients and caregivers from
prosecution for using or from collectively or cooperatively
cultivating medical marijuana, the CUA and the MMP 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 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 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
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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.
United States Department of Justice (USDOJ) Guidance Regarding
Marijuana Enforcement. On August 29, 2013, the USDOJ issued a
memorandum that updated its guidance to all United States
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, it also noted that
USDOJ is committed to using its limited investigative and
prosecutorial resources to address the most significant threats.
According to the USDOJ, "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 Cannabis Industry in California. According to the
author's Sunrise Questionnaire, submitted to the Assembly
Business and Professions Committee pursuant to Government Code
Section 9148 et seq., there are multiple occupational groups
interested in state regulation, representing a growing marijuana
industry. Because marijuana remains federally prohibited, it is
not recognized by the federal government as having any medicinal
value. United States Attorneys with jurisdiction over
California and neighboring states remain capable of launching
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enforcement actions at any time. In addition, 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. As a
result, while some local governments have established
comprehensive licensing and regulatory schemes, many
practitioners in this industry are part of an underground
economy that is unregulated, unlicensed, and untaxed.
According to the author, there is significant public demand for
uniform standards in the field of health and safety, and many
local jurisdictions would like to see a uniform state regulatory
structure, and have refused to allow cultivation or sale of
marijuana within their boundaries in the absence of such a
structure. There is also widespread public demand for marijuana
cultivation standards that mirror established agricultural
standards and that will alleviate environmental degradation.
According to the author, without regulation, harm to consumers
is very likely given that no health and safety standards exist
for marijuana, so there are none to be enforced.
Analysis Prepared by:
Eunie Linden / B. & P. / (916) 319-3301 FN:
0002445