BILL ANALYSIS Ó
AB 2545
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Date of Hearing: May 18, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
AB
2545 (Bonta) - As Amended April 26, 2016
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill authorizes the Governor to enter into agreements
concerning medical cannabis with federally recognized sovereign
Indian tribes, as specified, and authorizes the Governor to
delegate to the chief of the Bureau of Medical Marijuana
Regulation (Bureau) within the Department of Consumer Affairs
authority to negotiate the agreements.
In addition, it requires any such agreement to require
individuals conducting medical cannabis business activity on
tribal land to meet the state and local licensure requirements
applicable in the jurisdiction of the local government in which
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the tribal land is located.
FISCAL EFFECT:
1)Assuming the Governor delegated authority to the Bureau to
negotiate agreements with federally recognized sovereign
Indian tribes, the Bureau would need $150,000 in fiscal year
2016-17, and $270,000 every year thereafter (Medical Marijuana
Regulation and Safety Act Fund).
Implementation would require an attorney to meet with all
Indian tribes in California that choose to enter into
agreements and negotiate the terms of the agreements, and
additional staff to assist with the development of regulations
and monitoring of agreements.
2)With approximately 110 federally recognized sovereign Indian
tribes and assuming all tribes would pursue an agreement with
the state, the Bureau would also incur about $115,000 in
travel expenses in the first year of implementation (Medical
Marijuana Regulation and Safety Act Fund).
3)State licensure and enforcement costs could also potentially
be large if a large number of entities on tribal lands seek
state licensure (Medical Marijuana Regulation and Safety Act
Fund, reimbursed by licensure fees).
COMMENTS:
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1)Purpose. This bill is sponsored by the author. According
to the author, this bill will guide California on a pathway to
integrating tribal governments and businesses on sovereign
land into the the regulated market for medical cannabis (or
marijuana).
2)Background. Medical cannabis, 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 medical marijuana 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, and
implementation-related Budget Change Proposals proposed in the
2016-17 Governor's Budget being considered through the budget
process.
MMRSA is based on a system of dual licensure-all businesses
must have both a state and a local license. However, under
current law, tribal governments are sovereign entities, not
subject to the new regulatory scheme. Under MMRSA, licensed
businesses can only conduct business with other licensees. If
businesses on sovereign land are unable to obtain a state
license, they would be excluded from the state system and
unable to legally interact with the rest of the industry.
3)Related federal memoranda. The August 29, 2013 Memorandum
issued by the U.S. Department of Justice (DOJ) indicates that
while cannabis remains a Schedule 1 drug, the federal
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government is less inclined to intervene in states that have
authorized medical cannabis use if the states have strong and
effective regulatory and enforcement systems. It also listed
federal enforcement priorities, including preventing diversion
to minors or to states where marijuana is illegal, preventing
violence and the use of firearms in trafficking, and
preventing drugged driving and adverse public health
consequences, among other priorities.
On October 28, 2014, U.S. DOJ published a memorandum regarding
cannabis issues on tribal lands. The statement reaffirmed
that the Cole Memorandum does not alter the authority or
jurisdiction of the U.S. to enforce federal law on sovereign
lands; however, it stated the priorities listed in the 2013
Cole Memorandum will guide the U.S. Attorneys' cannabis
enforcement efforts on sovereign lands. As such, in order for
a state to have a complete and robust regulatory system for
medical cannabis operations, the author of this bill believes
it is important to include businesses on sovereign lands.
4)Related legislation. Eight other bills active in this session
address various issues of cannabis regulation, taxation,
reporting, and other issues, including AB 1575 (Bonta), which
is pending on the Suspense File of this committee
5)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.
AB 2545
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Analysis Prepared by:Lisa Murawski / APPR. / (916)
319-2081