BILL ANALYSIS Ó
AB 2385
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Date of Hearing: May 11, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
AB
2385 (Jones-Sawyer) - As Amended April 5, 2016
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
As proposed to be amended, this bill specifies state licensing
authorities shall not require a local license, permit, or other
authorization in order to issue a state license for commercial
cannabis license applicants located in the City of Los Angeles,
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provided the applicant meets specified criteria.
It also provides that notwithstanding the provisions above, if
the voters approve an initiative after January 1, 2016, but
prior to the time the state begins issuing state licenses, that
authorizes the City of Los Angeles to issue local licenses, the
exemption for local licensing as set forth above shall be
superseded by the local licensing requirements as enacted by
that initiative.
Amendments clarify the state licensing authority's determination
of whether applicants meet the criteria, which include
compliance with City of Los Angeles' requirements under Measure
D of 2013, is based on a written or electronic notification
provided by the City of Los Angeles to the licensing authority.
FISCAL EFFECT:
As amended, the fiscal impact to state licensing authorities is
expected to be minor and absorbable (fee-supported special
funds).
Specifically, AB 243 (Wood), Chapter 688, Statutes of 2015, one
of the bills establishing Medical Marijuana Regulation and
Safety Act (MMRSA), appropriated $10 million GF to the Medical
Marijuana Regulation and Safety Act Fund for start-up
activities. MMRSA requires each licensing authority for medical
marijuana, including the Bureau of Medical Marijuana Regulation
within the Department of Consumer Affairs, the California
Department of Public Health, and the California Department of
Food and Agriculture, to charge fees commensurate with
regulatory costs. Further, each licensing authority is required
to generate sufficient fee revenue to cover the specific
licensure program administered by that authority.
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Implementation-related Budget Change Proposals proposed in the
2016-17 Governor's Budget are being considered through the
budget process. Any work associated with licensing operations
in the City of Los Angeles is expected to be absorbed within the
existing workload plan.
COMMENTS:
1)Purpose. This bill will allow entities currently operating in
the City of Los Angeles to apply for and receive a state
license by allowing businesses operating in compliance with
specified provisions of the City's voter-approved initiative
do not need a local permit. This will allow them to comply
with state licensure. This bill also allows for the adoption
of local permits by the City if voters approve an initiative
allowing for this, which would then supersede the bill's other
provisions and become the operative local approval process.
2)Background. Medical cannabis (or marijuana), though illegal
under federal law, has been legal under state law since the
passage of Proposition 215 in 1996. The Medical Marijuana
Regulation and Safety Act (MMRSA) was a package of three bills
enacted together in 2015 to regulate the industry and license
its participants. The bills created a comprehensive state
regulatory system for the commercial cultivation, manufacture,
retail sale, transport, distribution, delivery, and testing of
medical cannabis. Various state agencies are tasked with
implementation, as noted above.
Current law prohibits a person from engaging in commercial
cannabis activity without possessing both a state license and
a local permit or other authorization, upon the date of
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implementation of regulations by the licensing authority.
In 2013, the City of Los Angeles passed Measure D, allowing
some dispensaries to remain open while banning others. Under
Measure D, the City of Los Angeles does not actually issue
permits or licenses to those dispensaries; instead, the city
gave certain businesses immunity. This bill will allow
applicants are in the City Los Angeles that are compliant with
specified provisions of Measure D to apply for state licenses.
3)Prior Legislation. AB 266 (Bonta, Cooley, Jones-Sawyer,
Lackey, and Wood), Chapter 689, Statutes of 2015; SB 643
(McGuire), Chapter 719, Statutes of 2015; and AB 243,
described above, were companion bills that formed the MMRSA.
4)Related Legislation. Eight other bills active in this session
address various issues of cannabis regulation, taxation, and
reporting, including AB 1575 (Bonta), which is a
cannabis-related omnibus bill also being heard today in this
committee.
Analysis Prepared by:Lisa Murawski / APPR. / (916)
319-2081
AB 2385
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