BILL NUMBER: AB 266 ENROLLED
BILL TEXT
PASSED THE SENATE SEPTEMBER 11, 2015
PASSED THE ASSEMBLY SEPTEMBER 11, 2015
AMENDED IN SENATE SEPTEMBER 11, 2015
AMENDED IN SENATE SEPTEMBER 4, 2015
AMENDED IN SENATE SEPTEMBER 1, 2015
AMENDED IN SENATE AUGUST 17, 2015
AMENDED IN SENATE JULY 13, 2015
AMENDED IN SENATE JUNE 30, 2015
AMENDED IN ASSEMBLY JUNE 2, 2015
AMENDED IN ASSEMBLY MAY 11, 2015
AMENDED IN ASSEMBLY MAY 5, 2015
AMENDED IN ASSEMBLY APRIL 14, 2015
INTRODUCED BY Assembly Members Bonta, Cooley, Jones-Sawyer, Lackey,
and Wood
FEBRUARY 10, 2015
An act to amend Sections 27 and 101 of, to add Section 205.1 to,
and to add Chapter 3.5 (commencing with Section 19300) to Division 8
of, the Business and Professions Code, to amend Section 9147.7 of the
Government Code, to amend Section 11362.775 of the Health and Safety
Code, to add Section 147.5 to the Labor Code, and to add Section
31020 to the Revenue and Taxation Code, relating to medical
marijuana.
LEGISLATIVE COUNSEL'S DIGEST
AB 266, Bonta. Medical marijuana.
(1) Existing law, the Compassionate Use Act of 1996, an initiative
measure enacted by the approval of Proposition 215 at the November
5, 1996, statewide general election, authorizes the use of marijuana
for medical purposes. Existing law enacted by the Legislature
requires the establishment of a program for the issuance of
identification cards to qualified patients so that they may lawfully
use marijuana for medical purposes, and requires the establishment of
guidelines for the lawful cultivation of marijuana grown for medical
use. Existing law provides for the licensure of various professions
by boards or bureaus within the Department of Consumer Affairs.
Existing law, the Sherman Food, Drug, and Cosmetic Law, provides for
the regulation of food, drugs, devices, and cosmetics, as specified.
A violation of that law is a crime.
This bill, among other things, would enact the Medical Marijuana
Regulation and Safety Act for the licensure and regulation of medical
marijuana and would establish within the Department of Consumer
Affairs the Bureau of Medical Marijuana Regulation, under the
supervision and control of the Director of Consumer Affairs. The bill
would require the director to administer and enforce the provisions
of the act.
This bill would also require the Board of Equalization, in
consultation with the Department of Food and Agriculture, to adopt a
system for reporting the movement of commercial cannabis and cannabis
products.
This bill would impose certain fines and civil penalties for
specified violations of the act, and would require moneys collected
as a result of these fines and civil penalties to be deposited into
the Medical Cannabis Fines and Penalties Account.
(2) Under existing law, certain persons with identification cards,
who associate within the state in order collectively or
cooperatively to cultivate marijuana for medical purposes, are not
solely on the basis of that fact subject to specified state criminal
sanctions.
This bill would repeal these provisions upon the issuance of
licenses by licensing authorities pursuant to the Medical Marijuana
Regulation and Safety Act, as specified, and would instead provide
that actions of licensees with the relevant local permits, in
accordance with the act and applicable local ordinances, are not
offenses subject to arrest, prosecution, or other sanction under
state law.
(3) This bill would provide that its provisions are severable.
(4) Existing constitutional provisions require that a statute that
limits the right of access to the meetings of public bodies or the
writings of public officials and agencies be adopted with findings
demonstrating the interest protected by the limitation and the need
for protecting that interest.
This bill would make legislative findings to that effect.
(5) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement. This bill would provide that, if the Commission on
State Mandates determines that the bill contains costs mandated by
the state, reimbursement for those costs shall be made pursuant to
these statutory provisions.
(6) The bill would provide that it shall become operative only if
SB 643 and AB 243 of the 2015-16 Regular Session are also enacted and
become operative.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 27 of the Business and Professions Code is
amended to read:
27. (a) Each entity specified in subdivisions (c), (d), and (e)
shall provide on the Internet information regarding the status of
every license issued by that entity in accordance with the California
Public Records Act (Chapter 3.5 (commencing with Section 6250) of
Division 7 of Title 1 of the Government Code) and the Information
Practices Act of 1977 (Chapter 1 (commencing with Section 1798) of
Title 1.8 of Part 4 of Division 3 of the Civil Code). The public
information to be provided on the Internet shall include information
on suspensions and revocations of licenses issued by the entity and
other related enforcement action, including accusations filed
pursuant to the Administrative Procedure Act (Chapter 3.5 (commencing
with Section 11340) of Part 1 of Division 3 of Title 2 of the
Government Code) taken by the entity relative to persons, businesses,
or facilities subject to licensure or regulation by the entity. The
information may not include personal information, including home
telephone number, date of birth, or social security number. Each
entity shall disclose a licensee's address of record. However, each
entity shall allow a licensee to provide a post office box number or
other alternate address, instead of his or her home address, as the
address of record. This section shall not preclude an entity from
also requiring a licensee, who has provided a post office box number
or other alternative mailing address as his or her address of record,
to provide a physical business address or residence address only for
the entity's internal administrative use and not for disclosure as
the licensee's address of record or disclosure on the Internet.
(b) In providing information on the Internet, each entity
specified in subdivisions (c) and (d) shall comply with the
Department of Consumer Affairs' guidelines for access to public
records.
(c) Each of the following entities within the Department of
Consumer Affairs shall comply with the requirements of this section:
(1) The Board for Professional Engineers, Land Surveyors, and
Geologists shall disclose information on its registrants and
licensees.
(2) The Bureau of Automotive Repair shall disclose information on
its licensees, including auto repair dealers, smog stations, lamp and
brake stations, smog check technicians, and smog inspection
certification stations.
(3) The Bureau of Electronic and Appliance Repair, Home
Furnishings, and Thermal Insulation shall disclose information on its
licensees and registrants, including major appliance repair dealers,
combination dealers (electronic and appliance), electronic repair
dealers, service contract sellers, and service contract
administrators.
(4) The Cemetery and Funeral Bureau shall disclose information on
its licensees, including cemetery brokers, cemetery salespersons,
cemetery managers, crematory managers, cemetery authorities,
crematories, cremated remains disposers, embalmers, funeral
establishments, and funeral directors.
(5) The Professional Fiduciaries Bureau shall disclose information
on its licensees.
(6) The Contractors' State License Board shall disclose
information on its licensees and registrants in accordance with
Chapter 9 (commencing with Section 7000) of Division 3. In addition
to information related to licenses as specified in subdivision (a),
the board shall also disclose information provided to the board by
the Labor Commissioner pursuant to Section 98.9 of the Labor Code.
(7) The Bureau for Private Postsecondary Education shall disclose
information on private postsecondary institutions under its
jurisdiction, including disclosure of notices to comply issued
pursuant to Section 94935 of the Education Code.
(8) The California Board of Accountancy shall disclose information
on its licensees and registrants.
(9) The California Architects Board shall disclose information on
its licensees, including architects and landscape architects.
(10) The State Athletic Commission shall disclose information on
its licensees and registrants.
(11) The State Board of Barbering and Cosmetology shall disclose
information on its licensees.
(12) The State Board of Guide Dogs for the Blind shall disclose
information on its licensees and registrants.
(13) The Acupuncture Board shall disclose information on its
licensees.
(14) The Board of Behavioral Sciences shall disclose information
on its licensees, including licensed marriage and family therapists,
licensed clinical social workers, licensed educational psychologists,
and licensed professional clinical counselors.
(15) The Dental Board of California shall disclose information on
its licensees.
(16) The State Board of Optometry shall disclose information
regarding certificates of registration to practice optometry,
statements of licensure, optometric corporation registrations, branch
office licenses, and fictitious name permits of its licensees.
(17) The Board of Psychology shall disclose information on its
licensees, including psychologists, psychological assistants, and
registered psychologists.
(d) The State Board of Chiropractic Examiners shall disclose
information on its licensees.
(e) The Structural Pest Control Board shall disclose information
on its licensees, including applicators, field representatives, and
operators in the areas of fumigation, general pest and wood
destroying pests and organisms, and wood roof cleaning and treatment.
(f) The Bureau of Medical Marijuana Regulation shall disclose
information on its licensees.
(g) "Internet" for the purposes of this section has the meaning
set forth in paragraph (6) of subdivision (f) of Section 17538.
SEC. 2. Section 101 of the Business and Professions Code is
amended to read:
101. The department is comprised of the following:
(a) The Dental Board of California.
(b) The Medical Board of California.
(c) The State Board of Optometry.
(d) The California State Board of Pharmacy.
(e) The Veterinary Medical Board.
(f) The California Board of Accountancy.
(g) The California Architects Board.
(h) The Bureau of Barbering and Cosmetology.
(i) The Board for Professional Engineers and Land Surveyors.
(j) The Contractors' State License Board.
(k) The Bureau for Private Postsecondary Education.
(l) The Bureau of Electronic and Appliance Repair, Home
Furnishings, and Thermal Insulation.
(m) The Board of Registered Nursing.
(n) The Board of Behavioral Sciences.
(o) The State Athletic Commission.
(p) The Cemetery and Funeral Bureau.
(q) The State Board of Guide Dogs for the Blind.
(r) The Bureau of Security and Investigative Services.
(s) The Court Reporters Board of California.
(t) The Board of Vocational Nursing and Psychiatric Technicians.
(u) The Landscape Architects Technical Committee.
(v) The Division of Investigation.
(w) The Bureau of Automotive Repair.
(x) The Respiratory Care Board of California.
(y) The Acupuncture Board.
(z) The Board of Psychology.
(aa) The California Board of Podiatric Medicine.
(ab) The Physical Therapy Board of California.
(ac) The Arbitration Review Program.
(ad) The Physician Assistant Committee.
(ae) The Speech-Language Pathology and Audiology Board.
(af) The California Board of Occupational Therapy.
(ag) The Osteopathic Medical Board of California.
(ah) The Naturopathic Medicine Committee.
(ai) The Dental Hygiene Committee of California.
(aj) The Professional Fiduciaries Bureau.
(ak) The State Board of Chiropractic Examiners.
(a l ) The Bureau of Real Estate.
(am) The Bureau of Real Estate Appraisers.
(an) The Structural Pest Control Board.
(ao) The Bureau of Medical Marijuana Regulation.
(ap) Any other boards, offices, or officers subject to its
jurisdiction by law.
SEC. 3. Section 205.1 is added to the Business and Professions
Code, to read:
205.1. Notwithstanding subdivision (a) of Section 205, the
Medical Marijuana Regulation and Safety Act Fund is a special fund
within the Professions and Vocations Fund, and is subject to
subdivision (b) of Section 205.
SEC. 4. Chapter 3.5 (commencing with Section 19300) is added to
Division 8 of the Business and Professions Code, to read:
CHAPTER 3.5. MEDICAL MARIJUANA REGULATION AND SAFETY ACT
Article 1. Definitions
19300. This act shall be known and may be cited as the Medical
Marijuana Regulation and Safety Act.
19300.5. For purposes of this chapter, the following definitions
shall apply:
(a) "Accrediting body" means a nonprofit organization that
requires conformance to ISO/IEC 17025 requirements and is a signatory
to the International Laboratory Accreditation Cooperation Mutual
Recognition Arrangement for Testing.
(b) "Applicant," for purposes of Article 4 (commencing with
Section 19319), means the following:
(1) Owner or owners of a proposed facility, including all persons
or entities having ownership interest other than a security interest,
lien, or encumbrance on property that will be used by the facility.
(2) If the owner is an entity, "owner" includes within the entity
each person participating in the direction, control, or management
of, or having a financial interest in, the proposed facility.
(3) If the applicant is a publicly traded company, "owner" means
the chief executive officer or any person or entity with an aggregate
ownership interest of 5 percent or more.
(c) "Batch" means a specific quantity of medical cannabis or
medical cannabis products that is intended to have uniform character
and quality, within specified limits, and is produced according to a
single manufacturing order during the same cycle of manufacture.
(d) "Bureau" means the Bureau of Medical Marijuana Regulation
within the Department of Consumer Affairs.
(e) "Cannabinoid" or "phytocannabinoid" means a chemical compound
that is unique to and derived from cannabis.
(f) "Cannabis" means all parts of the plant Cannabis sativa
Linnaeus, Cannabis indica, or Cannabis ruderalis, whether growing or
not; the seeds thereof; the resin, whether crude or purified,
extracted from any part of the plant; and every compound,
manufacture, salt, derivative, mixture, or preparation of the plant,
its seeds, or resin. "Cannabis" also means the separated resin,
whether crude or purified, obtained from marijuana. "Cannabis" also
means marijuana as defined by Section 11018 of the Health and Safety
Code as enacted by Chapter 1407 of the Statutes of 1972. "Cannabis"
does not include the mature stalks of the plant, fiber produced from
the stalks, oil or cake made from the seeds of the plant, any other
compound, manufacture, salt, derivative, mixture, or preparation of
the mature stalks (except the resin extracted therefrom), fiber, oil,
or cake, or the sterilized seed of the plant which is incapable of
germination. For the purpose of this chapter, "cannabis" does not
mean "industrial hemp" as defined by Section 81000 of the Food and
Agricultural Code or Section 11018.5 of the Health and Safety Code.
(g) "Cannabis concentrate" means manufactured cannabis that has
undergone a process to concentrate the cannabinoid active ingredient,
thereby increasing the product's potency. An edible medical cannabis
product is not considered food, as defined by Section 109935 of the
Health and Safety Code, or a drug, as defined by Section 109925 of
the Health and Safety Code.
(h) "Caregiver" or "primary caregiver" has the same meaning as
that term is defined in Section 11362.7 of the Health and Safety
Code.
(i) "Certificate of accreditation" means a certificate issued by
an accrediting body to a licensed testing laboratory, entity, or site
to be registered in the state.
(j) "Chief" means Chief of the Bureau of Medical Marijuana
Regulation within the Department of Consumer Affairs.
(k) "Commercial cannabis activity" includes cultivation,
possession, manufacture, processing, storing, laboratory testing,
labeling, transporting, distribution, or sale of medical cannabis or
a medical cannabis product, except as set forth in Section 19319,
related to qualifying patients and primary caregivers.
(l) "Cultivation" means any activity involving the planting,
growing, harvesting, drying, curing, grading, or trimming of
cannabis.
(m) "Delivery" means the commercial transfer of medical cannabis
or medical cannabis products from a dispensary, up to an amount
determined by the bureau to a primary caregiver or qualified patient
as defined in Section 11362.7 of the Health and Safety Code, or a
testing laboratory. "Delivery" also includes the use by a dispensary
of any technology platform owned and controlled by the dispensary, or
independently licensed under this chapter, that enables qualified
patients or primary caregivers to arrange for or facilitate the
commercial transfer by a licensed dispensary of medical cannabis or
medical cannabis products.
(n) "Dispensary" means a facility where medical cannabis, medical
cannabis products, or devices for the use of medical cannabis or
medical cannabis products are offered, either individually or in any
combination, for retail sale, including an establishment that
delivers, pursuant to express authorization by local ordinance,
medical cannabis and medical cannabis products as part of a retail
sale.
(o) "Dispensing" means any activity involving the retail sale of
medical cannabis or medical cannabis products from a dispensary.
(p) "Distribution" means the procurement, sale, and transport of
medical cannabis and medical cannabis products between entities
licensed pursuant to this chapter.
(q) "Distributor" means a person licensed under this chapter to
engage in the business of purchasing medical cannabis from a licensed
cultivator, or medical cannabis products from a licensed
manufacturer, for sale to a licensed dispensary.
(r) "Dried flower" means all dead medical cannabis that has been
harvested, dried, cured, or otherwise processed, excluding leaves and
stems.
(s) "Edible cannabis product" means manufactured cannabis that is
intended to be used, in whole or in part, for human consumption,
including, but not limited to, chewing gum. An edible medical
cannabis product is not considered food as defined by Section 109935
of the Health and Safety Code or a drug as defined by Section 109925
of the Health and Safety Code.
(t) "Fund" means the Medical Marijuana Regulation and Safety Act
Fund established pursuant to Section 19351.
(u) "Identification program" means the universal identification
certificate program for commercial medical cannabis activity
authorized by this chapter.
(v) "Labor peace agreement" means an agreement between a licensee
and a bona fide labor organization that, at a minimum, protects the
state's proprietary interests by prohibiting labor organizations and
members from engaging in picketing, work stoppages, boycotts, and any
other economic interference with the applicant's business. This
agreement means that the applicant has agreed not to disrupt efforts
by the bona fide labor organization to communicate with, and attempt
to organize and represent, the applicant's employees. The agreement
shall provide a bona fide labor organization access at reasonable
times to areas in which the applicant's employees work, for the
purpose of meeting with employees to discuss their right to
representation, employment rights under state law, and terms and
conditions of employment. This type of agreement shall not mandate a
particular method of election or certification of the bona fide labor
organization.
(w) "Licensing authority" means the state agency responsible for
the issuance, renewal, or reinstatement of the license, or the state
agency authorized to take disciplinary action against the license.
(x) "Cultivation site" means a facility where medical cannabis is
planted, grown, harvested, dried, cured, graded, or trimmed, or that
does all or any combination of those activities, that holds a valid
state license pursuant to this chapter, and that holds a valid local
license or permit.
(y) "Manufacturer" means a person that conducts the production,
preparation, propagation, or compounding of manufactured medical
cannabis, as described in subdivision (ae), or medical cannabis
products either directly or indirectly or by extraction methods, or
independently by means of chemical synthesis or by a combination of
extraction and chemical synthesis at a fixed location that packages
or repackages medical cannabis or medical cannabis products or labels
or relabels its container, that holds a valid state license pursuant
to this chapter, and that holds a valid local license or permit.
(z) "Testing laboratory" means a facility, entity, or site in the
state that offers or performs tests of medical cannabis or medical
cannabis products and that is both of the following:
(1) Accredited by an accrediting body that is independent from all
other persons involved in the medical cannabis industry in the
state.
(2) Registered with the State Department of Public Health.
(aa) "Transporter" means a person issued a state license by the
bureau to transport medical cannabis or medical cannabis products in
an amount above a threshold determined by the bureau between
facilities that have been issued a state license pursuant to this
chapter.
(ab) "Licensee" means a person issued a state license under this
chapter to engage in commercial cannabis activity.
(ac) "Live plants" means living medical cannabis flowers and
plants, including seeds, immature plants, and vegetative stage
plants.
(ad) "Lot" means a batch, or a specifically identified portion of
a batch, having uniform character and quality within specified
limits. In the case of medical cannabis or a medical cannabis product
produced by a continuous process, "lot" means a specifically
identified amount produced in a unit of time or a quantity in a
manner that ensures its having uniform character and quality within
specified limits.
(ae) "Manufactured cannabis" means raw cannabis that has undergone
a process whereby the raw agricultural product has been transformed
into a concentrate, an edible product, or a topical product.
(af) "Manufacturing site" means a location that produces,
prepares, propagates, or compounds manufactured medical cannabis or
medical cannabis products, directly or indirectly, by extraction
methods, independently by means of chemical synthesis, or by a
combination of extraction and chemical synthesis, and is owned and
operated by a licensee for these activities.
(ag) "Medical cannabis," "medical cannabis product," or "cannabis
product" means a product containing cannabis, including, but not
limited to, concentrates and extractions, intended to be sold for use
by medical cannabis patients in California pursuant to the
Compassionate Use Act of 1996 (Proposition 215), found at Section
11362.5 of the Health and Safety Code. For the purposes of this
chapter, "medical cannabis" does not include "industrial hemp" as
defined by Section 81000 of the Food and Agricultural Code or Section
11018.5 of the Health and Safety Code.
(ah) "Nursery" means a licensee that produces only clones,
immature plants, seeds, and other agricultural products used
specifically for the planting, propagation, and cultivation of
medical cannabis.
(ai) "Permit," "local license," or "local permit" means an
official document granted by a local jurisdiction that specifically
authorizes a person to conduct commercial cannabis activity in the
local jurisdiction.
(aj) "Person" means an individual, firm, partnership, joint
venture, association, corporation, limited liability company, estate,
trust, business trust, receiver, syndicate, or any other group or
combination acting as a unit and includes the plural as well as the
singular number.
(ak) "State license," "license," or "registration" means a state
license issued pursuant to this chapter.
(al) "Topical cannabis" means a product intended for external use.
A topical cannabis product is not considered a drug as defined by
Section 109925 of the Health and Safety Code.
(am) "Transport" means the transfer of medical cannabis or medical
cannabis products from the permitted business location of one
licensee to the permitted business location of another licensee, for
the purposes of conducting commercial cannabis activity authorized
pursuant to this chapter.
19300.7. License classifications pursuant to this chapter are as
follows:
(a) Type 1 = Cultivation; Specialty outdoor; Small.
(b) Type 1A = Cultivation; Specialty indoor; Small.
(c) Type 1B = Cultivation; Specialty mixed-light; Small.
(d) Type 2 = Cultivation; Outdoor; Small.
(e) Type 2A = Cultivation; Indoor; Small.
(f) Type 2B = Cultivation; Mixed-light; Small.
(g) Type 3 = Cultivation; Outdoor; Medium.
(h) Type 3A = Cultivation; Indoor; Medium.
(i) Type 3B = Cultivation; Mixed-light; Medium.
(j) Type 4 = Cultivation; Nursery.
(k) Type 6 = Manufacturer 1.
(l) Type 7 = Manufacturer 2.
(m) Type 8 = Testing.
(n) Type 10 = Dispensary; General.
(o) Type 10A = Dispensary; No more than three retail sites.
(p) Type 11 = Distribution.
(q) Type 12 = Transporter.
Article 2. Administration
19302. There is in the Department of Consumer Affairs the Bureau
of Medical Marijuana Regulation, under the supervision and control of
the director. The director shall administer and enforce the
provisions of this chapter.
19303. Protection of the public shall be the highest priority for
the bureau in exercising its licensing, regulatory, and disciplinary
functions under this chapter. Whenever the protection of the public
is inconsistent with other interests sought to be promoted, the
protection of the public shall be paramount.
19304. The bureau shall make and prescribe reasonable rules as
may be necessary or proper to carry out the purposes and intent of
this chapter and to enable it to exercise the powers and duties
conferred upon it by this chapter, not inconsistent with any statute
of this state, including particularly this chapter and Chapter 3.5
(commencing with Section 11340) of Part 1 of Division 3 of Title 2 of
the Government Code. For the performance of its duties, the bureau
has the power conferred by Sections 11180 to 11191, inclusive, of the
Government Code.
19305. Notice of any action of the licensing authority required
by this chapter to be given may be signed and given by the director
or an authorized employee of the department and may be made
personally or in the manner prescribed by Section 1013 of the Code of
Civil Procedure.
19306. (a) The bureau may convene an advisory committee to advise
the bureau and licensing authorities on the development of standards
and regulations pursuant to this chapter, including best practices
and guidelines to ensure qualified patients have adequate access to
medical cannabis and medical cannabis products. The advisory
committee members shall be determined by the chief.
(b) The advisory committee members may include, but not be limited
to, representatives of the medical marijuana industry,
representatives of medical marijuana cultivators, appropriate local
and state agencies, appropriate local and state law enforcement,
physicians, environmental and public health experts, and medical
marijuana patient advocates.
19307. A licensing authority may make or cause to be made such
investigation as it deems necessary to carry out its duties under
this chapter.
19308. For any hearing held pursuant to this chapter, the
director, or a licensing authority, may delegate the power to hear
and decide to an administrative law judge. Any hearing before an
administrative law judge shall be pursuant to the procedures, rules,
and limitations prescribed in Chapter 5 (commencing with Section
11500) of Part 1 of Division 3 of Title 2 of the Government Code.
19309. In any hearing before a licensing authority pursuant to
this chapter, the licensing authority may pay any person appearing as
a witness at the hearing at the request of the licensing authority
pursuant to a subpoena, his or her actual, necessary, and reasonable
travel, food, and lodging expenses, not to exceed the amount
authorized for state employees.
19310. The department may on its own motion at any time before a
penalty assessment is placed into effect and without any further
proceedings, review the penalty, but such review shall be limited to
its reduction.
Article 3. Enforcement
19311. Grounds for disciplinary action include:
(a) Failure to comply with the provisions of this chapter or any
rule or regulation adopted pursuant to this chapter.
(b) Conduct that constitutes grounds for denial of licensure
pursuant to Chapter 3 (commencing with Section 490) of Division 1.5.
(c) Any other grounds contained in regulations adopted by a
licensing authority pursuant to this chapter.
(d) Failure to comply with any state law, except as provided for
in this chapter or other California law.
19312. Each licensing authority may suspend or revoke licenses,
after proper notice and hearing to the licensee, if the licensee is
found to have committed any of the acts or omissions constituting
grounds for disciplinary action. The disciplinary proceedings under
this chapter shall be conducted in accordance with Chapter 5
(commencing with Section 11500) of Part 1 of Division 3 of Title 2 of
the Government Code, and the director of each licensing authority
shall have all the powers granted therein.
19313. Each licensing authority may take disciplinary action
against a licensee for any violation of this chapter when the
violation was committed by the licensee's agent or employee while
acting on behalf of the licensee or engaged in commercial cannabis
activity.
19313.5. Upon suspension or revocation of a license, the
licensing authority shall inform the bureau. The bureau shall then
inform all other licensing authorities and the Department of Food and
Agriculture.
19314. All accusations against licensees shall be filed by the
licensing authority within five years after the performance of the
act or omission alleged as the ground for disciplinary action;
provided, however, that the foregoing provision shall not constitute
a defense to an accusation alleging fraud or misrepresentation as a
ground for disciplinary action. The cause for disciplinary action in
such case shall not be deemed to have accrued until discovery, by the
licensing authority, of the facts constituting the fraud or
misrepresentation, and, in such case, the accusation shall be filed
within five years after
such discovery.
19315. (a) Nothing in this chapter 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.
(b) Nothing in this chapter shall be interpreted to require the
Department of Consumer Affairs to undertake local law enforcement
responsibilities, enforce local zoning requirements, or enforce local
licensing requirements.
(c) Nothing in this chapter shall be interpreted to supersede or
limit state agencies from exercising their existing enforcement
authority under the Fish and Game Code, the Water Code, the Food and
Agricultural Code, or the Health and Safety Code.
19316. (a) Pursuant to Section 7 of Article XI of the California
Constitution, a city, county, or city and county may adopt ordinances
that establish additional standards, requirements, and regulations
for local licenses and permits for commercial cannabis activity. Any
standards, requirements, and regulations regarding health and safety,
testing, security, and worker protections established by the state
shall be the minimum standards for all licensees statewide.
(b) For facilities issued a state license that are located within
the incorporated area of a city, the city shall have full power and
authority to enforce this chapter and the regulations promulgated by
the bureau or any licensing authority, if delegated by the state.
Notwithstanding Sections 101375, 101400, and 101405 of the Health and
Safety Code or any contract entered into pursuant thereto, or any
other law, the city shall further assume complete 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.
(c) Nothing in this chapter, or any regulations promulgated
thereunder, shall be deemed to limit the authority or remedies of a
city, county, or city and county under any provision of law,
including, but not limited to, Section 7 of Article XI of the
California Constitution.
19317. (a) The actions of a licensee, its employees, and its
agents that are (1) permitted pursuant to both a state license and a
license or permit issued by the local jurisdiction following the
requirements of the applicable local ordinances, and (2) conducted in
accordance with the requirements of this chapter and regulations
adopted pursuant to this chapter, are not unlawful under state law
and shall not be an offense subject to arrest, prosecution, or other
sanction under state law, or be subject to a civil fine or be a basis
for seizure or forfeiture of assets under state law.
(b) The actions of a person who, in good faith, allows his or her
property to be used by a licensee, its employees, and its agents, as
permitted pursuant to both a state license and a local license or
permit following the requirements of the applicable local ordinances,
are not unlawful under state law and shall not be an offense subject
to arrest, prosecution, or other sanction under state law, or be
subject to a civil fine or be a basis for seizure or forfeiture of
assets under state law.
19318. (a) A person engaging in commercial cannabis activity
without a license required by this chapter shall be subject to civil
penalties of up to twice the amount of the license fee for each
violation, and the court may order the destruction of medical
cannabis associated with that violation in accordance with Section
11479 of the Health and Safety Code. Each day of operation shall
constitute a separate violation of this section. All civil penalties
imposed and collected pursuant to this section by a licensing
authority shall be deposited into the Medical Cannabis Fines and
Penalties Account established pursuant to Section 19351.
(b) If an action for civil penalties is brought against a licensee
pursuant to this chapter by the Attorney General on behalf of the
people, the penalty collected shall be deposited into the Medical
Cannabis Fines and Penalties Account established pursuant to Section
19351. If the action is brought by a district attorney or county
counsel, the penalty collected shall be paid to the treasurer of the
county in which the judgment was entered. If the action is brought by
a city attorney or city prosecutor, the penalty collected shall be
paid to the treasurer of the city or city and county in which the
judgment was entered. If the action is brought by a city attorney and
is adjudicated in a superior court located in the unincorporated
area or another city in the same county, the penalty shall be paid
one-half to the treasurer of the city in which the complaining
attorney has jurisdiction and one-half to the treasurer of the county
in which the judgment is entered.
(c) Notwithstanding subdivision (a), criminal penalties shall
continue to apply to an unlicensed person engaging in commercial
cannabis activity in violation of this chapter, including, but not
limited to, those individuals covered under Section 11362.7 of the
Health and Safety Code.
Article 4. Licensing
19320. (a) Licensing authorities administering this chapter may
issue state licenses only to qualified applicants engaging in
commercial cannabis activity pursuant to this chapter. Upon the date
of implementation of regulations by the licensing authority, no
person shall engage in commercial cannabis activity without
possessing both a state license and a local permit, license, or other
authorization. A licensee shall not commence activity under the
authority of a state license until the applicant has obtained, in
addition to the state license, a license or permit from the local
jurisdiction in which he or she proposes to operate, following the
requirements of the applicable local ordinance.
(b) Revocation of a local license, permit, or other authorization
shall terminate the ability of a medical cannabis business to operate
within that local jurisdiction until the local jurisdiction
reinstates or reissues the local license, permit, or other required
authorization. Local authorities shall notify the bureau upon
revocation of a local license. The bureau shall inform relevant
licensing authorities.
(c) Revocation of a state license shall terminate the ability of a
medical cannabis licensee to operate within California until the
licensing authority reinstates or reissues the state license. Each
licensee shall obtain a separate license for each location where it
engages in commercial medical cannabis activity. However,
transporters only need to obtain licenses for each physical location
where the licensee conducts business while not in transport, or any
equipment that is not currently transporting medical cannabis or
medical cannabis products, permanently resides.
(d) In addition to the provisions of this chapter, local
jurisdictions retain the power to assess fees and taxes, as
applicable, on facilities that are licensed pursuant to this chapter
and the business activities of those licensees.
(e) Nothing in this chapter shall be construed to supersede or
limit state agencies, including the State Water Resources Control
Board and Department of Fish and Wildlife, from establishing fees to
support their medical cannabis regulatory programs.
19321. (a) The Department of Consumer Affairs, the Department of
Food and Agriculture, and the State Department of Public Health shall
promulgate regulations for implementation of their respective
responsibilities in the administration of this chapter.
(b) A license issued pursuant to this section shall be valid for
12 months from the date of issuance. The license shall be renewed
annually. Each licensing authority shall establish procedures for the
renewal of a license.
(c) Notwithstanding subdivision (a) of Section 19320, 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 pursuant to this chapter. In
issuing licenses, the licensing authority shall prioritize any
facility or entity that can demonstrate to the authority's
satisfaction that it was in operation and in good standing with the
local jurisdiction by January 1, 2016.
(d) Issuance of a state license or a determination of compliance
with local law by the 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 otherwise enforce, Proposition D, approved by
the voters of the City of Los Angeles on the May 21, 2013, ballot for
the city, or the city's zoning laws. Nor may issuance of a license
or determination of compliance with local law by the licensing
authority be deemed to establish, or be relied upon, in determining
satisfaction with the immunity requirements of Proposition D or local
zoning law, in court or in any other context or forum.
Article 5. Medical Marijuana Regulation
19326. (a) A person other than a licensed transporter shall not
transport medical cannabis or medical cannabis products from one
licensee to another licensee, unless otherwise specified in this
chapter.
(b) All licensees holding cultivation or manufacturing licenses
shall send all medical cannabis and medical cannabis products
cultivated or manufactured to a distributor, as defined in Section
19300.5, for quality assurance and inspection by the Type 11 licensee
and for a batch testing by a Type 8 licensee prior to distribution
to a dispensary. Those licensees holding a Type 10A license in
addition to a cultivation license or a manufacturing license shall
send all medical cannabis and medical cannabis products to a Type 11
licensee for presale inspection and for a batch testing by a Type 8
licensee prior to dispensing any product. The licensing authority
shall fine a licensee who violates this subdivision in an amount
determined by the licensing authority to be reasonable.
(c) (1) Upon receipt of medical cannabis or medical cannabis
products by a holder of a cultivation or manufacturing license, the
Type 11 licensee shall first inspect the product to ensure the
identity and quantity of the product and then ensure a random sample
of the medical cannabis or medical cannabis product is tested by a
Type 8 licensee prior to distributing the batch of medical cannabis
or medical cannabis products.
(2) Upon issuance of a certificate of analysis by the Type 8
licensee that the product is fit for manufacturing or retail, all
medical cannabis and medical cannabis products shall undergo a
quality assurance review by the Type 11 licensee prior to
distribution to ensure the quantity and content of the medical
cannabis or medical cannabis product, and for tracking and taxation
purposes by the state. Licensed cultivators and manufacturers shall
package or seal all medical cannabis and medical cannabis products in
tamper-evident packaging and use a unique identifier, as prescribed
by the Department of Food and Agriculture, for the purpose of
identifying and tracking medical cannabis or medical cannabis
products. Medical cannabis and medical cannabis products shall be
labeled as required by Section 19347. All packaging and sealing shall
be completed prior to medical cannabis or medical cannabis products
being transported or delivered to a licensee, qualified patient, or
caregiver.
(3) This section does not limit the ability of licensed
cultivators, manufacturers, and dispensaries to directly enter into
contracts with one another indicating the price and quantity of
medical cannabis or medical cannabis products to be distributed.
However, a Type 11 licensee responsible for executing the contract is
authorized to collect a fee for the services rendered, including,
but not limited to, costs incurred by a Type 8 licensee, as well as
applicable state or local taxes and fees.
(d) Medical cannabis and medical cannabis products shall be tested
by a registered testing laboratory, prior to retail sale or
dispensing, as follows:
(1) Medical cannabis from dried flower shall, at a minimum, be
tested for concentration, pesticides, mold, and other contaminants.
(2) Medical cannabis extracts shall, at a minimum, be tested for
concentration and purity of the product.
(3) This chapter shall not prohibit a licensee from performing
on-site testing for the purposes of quality assurance of the product
in conjunction with reasonable business operations. On-site testing
by the licensee shall not be certified by the State Department of
Public Health.
(e) All commercial cannabis activity shall be conducted between
licensees, when these are available.
19327. (a) A licensee shall keep accurate records of commercial
cannabis activity.
(b) All records related to commercial cannabis activity as defined
by the licensing authorities shall be maintained for a minimum of
seven years.
(c) The bureau may examine the books and records of a licensee and
inspect the premises of a licensee as the licensing authority or a
state or local agency deems necessary to perform its duties under
this chapter. All inspections shall be conducted during standard
business hours of the licensed facility or at any other reasonable
time.
(d) Licensees shall keep records identified by the licensing
authorities on the premises of the location licensed. The licensing
authorities may make any examination of the records of any licensee.
Licensees shall also provide and deliver copies of documents to the
licensing agency upon request.
(e) A licensee or its agent, or employee, that refuses, impedes,
obstructs, or interferes with an inspection of the premises or
records of the licensee pursuant to this section has engaged in a
violation of this chapter.
(f) If a licensee or an employee of a licensee fails to maintain
or provide the records required pursuant to this section, the
licensee shall be subject to a citation and fine of thirty thousand
dollars ($30,000) per individual violation.
19328. (a) A licensee may only hold a state license in up to two
separate license categories, as follows:
(1) Type 1, 1A, 1B, 2, 2A, or 2B licensees may also hold either a
Type 6 or 7 state license.
(2) Type 6 or 7 licensees, or a combination thereof, may also hold
either a Type 1, 1A, 1B, 2, 2A, or 2B state license.
(3) Type 6 or 7 licensees, or a combination thereof, may also hold
a Type 10A state license.
(4) Type 10A licensees may also hold either a Type 6 or 7 state
license, or a combination thereof.
(5) Type 1, 1A, 1B, 2, 2A, or 2B licensees, or a combination
thereof, may also hold a Type 10A state license.
(6) Type 10A licensees may apply for Type 1, 1A, 1B, 2, 2A, or 2B
state license, or a combination thereof.
(7) Type 11 licensees shall apply for a Type 12 state license, but
shall not apply for any other type of state license.
(8) Type 12 licensees may apply for a Type 11 state license.
(9) A Type 10A licensee may apply for a Type 6 or 7 state license
and hold a 1, 1A, 1B, 2, 2A, 2B, 3, 3A, 3B, 4 or combination thereof
if, under the 1, 1A, 1B, 2, 2A, 2B, 3, 3A, 3B, 4 or combination of
licenses thereof, no more than four acres of total canopy size of
cultivation by the licensee is occurring throughout the state during
the period that the respective licenses are valid. All cultivation
pursuant to this section shall comply with local ordinances. This
paragraph shall become inoperative on January 1, 2026.
(b) Except as provided in subdivision (a), a person or entity that
holds a state license is prohibited from licensure for any other
activity authorized under this chapter, and is prohibited from
holding an ownership interest in real property, personal property, or
other assets associated with or used in any other license category.
(c) (1) In a jurisdiction that adopted a local ordinance, prior to
July 1, 2015, allowing or requiring qualified businesses to
cultivate, manufacture, and dispense medical cannabis or medical
cannabis products, with all commercial cannabis activity being
conducted by a single qualified business, upon licensure that
business shall not be subject to subdivision (a) if it meets all of
the following conditions:
(A) The business was cultivating, manufacturing, and dispensing
medical cannabis or medical cannabis products on July 1, 2015, and
has continuously done so since that date.
(B) The business has been in full compliance with all applicable
local ordinances at all times prior to licensure.
(C) The business is registered with the State Board of
Equalization.
(2) A business licensed pursuant to paragraph (1) is not required
to conduct all cultivation or manufacturing within the bounds of a
local jurisdiction, but all cultivation and manufacturing shall have
commenced prior to July 1, 2015, and have been in full compliance
with applicable local ordinances.
(d) This section shall remain in effect only until January 1,
2026, and as of that date is repealed.
19329. A licensee shall not also be licensed as a retailer of
alcoholic beverages pursuant to Division 9 (commencing with Section
23000).
19330. This chapter and Article 2 (commencing with Section 11357)
and Article 2.5 (commencing with Section 11362.7) of Chapter 6 of
Division 10 of the Health and Safety Code shall not interfere with an
employer's rights and obligations to maintain a drug and alcohol
free workplace or require an employer to permit or accommodate the
use, consumption, possession, transfer, display, transportation,
sale, or growth of cannabis in the workplace or affect the ability of
employers to have policies prohibiting the use of cannabis by
employees and prospective employees, or prevent employers from
complying with state or federal law.
Article 7. Licensed Distributors, Dispensaries, and
Transporters
19334. (a) State licenses to be issued by the Department of
Consumer Affairs are as follows:
(1) "Dispensary," as defined in this chapter. This license shall
allow for delivery pursuant to Section 19340.
(2) "Distributor," for the distribution of medical cannabis and
medical cannabis products from manufacturer to dispensary. A Type 11
licensee shall hold a Type 12, or transporter, license and register
each location where product is stored for the purposes of
distribution. A Type 11 licensee shall not hold a license in a
cultivation, manufacturing, dispensing, or testing license category
and shall not own, or have an ownership interest in, a facility
licensed in those categories other than a security interest, lien, or
encumbrance on property that is used by a licensee. A Type 11
licensee shall be bonded and insured at a minimum level established
by the licensing authority.
(3) "Transport," for transporters of medical cannabis or medical
cannabis products between licensees. A Type 12 licensee shall be
bonded and insured at a minimum level established by the licensing
authority.
(4) "Special dispensary status" for dispensers who have no more
than three licensed dispensary facilities. This license shall allow
for delivery where expressly authorized by local ordinance.
(b) The bureau shall establish minimum security requirements for
the commercial transportation and delivery of medical cannabis and
products.
(c) A licensed dispensary shall implement sufficient security
measures to both deter and prevent unauthorized entrance into areas
containing medical cannabis or medical cannabis products and theft of
medical cannabis or medical cannabis products at the dispensary.
These security measures shall include, but not be limited to, all of
the following:
(1) Preventing individuals from remaining on the premises of the
dispensary if they are not engaging in activity expressly related to
the operations of the dispensary.
(2) Establishing limited access areas accessible only to
authorized dispensary personnel.
(3) Storing all finished medical cannabis and medical cannabis
products in a secured and locked room, safe, or vault, and in a
manner as to prevent diversion, theft, and loss, except for limited
amounts of cannabis used for display purposes, samples, or immediate
sale.
(d) A dispensary shall notify the licensing authority and the
appropriate law enforcement authorities within 24 hours after
discovering any of the following:
(1) Significant discrepancies identified during inventory. The
level of significance shall be determined by the bureau.
(2) Diversion, theft, loss, or any criminal activity involving the
dispensary or any agent or employee of the dispensary.
(3) The loss or unauthorized alteration of records related to
cannabis, registered qualifying patients, primary caregivers, or
dispensary employees or agents.
(4) Any other breach of security.
Article 9. Delivery
19340. (a) Deliveries, as defined in this chapter, can only be
made by a dispensary and in a city, county, or city and county that
does not explicitly prohibit it by local ordinance.
(b) Upon approval of the licensing authority, a licensed
dispensary that delivers medical cannabis or medical cannabis
products shall comply with both of the following:
(1) The city, county, or city and county in which the licensed
dispensary is located, and in which each delivery is made, do not
explicitly by ordinance prohibit delivery, as defined in Section
19300.5.
(2) All employees of a dispensary delivering medical cannabis or
medical cannabis products shall carry a copy of the dispensary's
current license authorizing those services with them during
deliveries and the employee's government-issued identification, and
shall present that license and identification upon request to state
and local law enforcement, employees of regulatory authorities, and
other state and local agencies enforcing this chapter.
(c) A county shall have the authority to impose a tax, pursuant to
Article 11 (commencing with Section 19348), on each delivery
transaction completed by a licensee.
(d) During delivery, the licensee shall maintain a physical copy
of the delivery request and shall make it available upon request of
the licensing authority and law enforcement officers. The delivery
request documentation shall comply with state and federal law
regarding the protection of confidential medical information.
(e) The qualified patient or primary caregiver requesting the
delivery shall maintain a copy of the delivery request and shall make
it available, upon request, to the licensing authority and law
enforcement officers.
(f) A local jurisdiction shall not prevent carriage of medical
cannabis or medical cannabis products on public roads by a licensee
acting in compliance with this chapter.
Article 10. Licensed Manufacturers and Licensed Laboratories
19341. The State Department of Public Health shall promulgate
regulations governing the licensing of cannabis manufacturers and
testing laboratories. Licenses to be issued are as follows:
(a) "Manufacturing level 1," for manufacturing sites that produce
medical cannabis products using nonvolatile solvents.
(b) "Manufacturing level 2," for manufacturing sites that produce
medical cannabis products using volatile solvents. The State
Department of Public Health shall limit the number of licenses of
this type.
(c) "Testing," for testing of medical cannabis and medical
cannabis products. Testing licensees shall have their facilities
licensed according to regulations set forth by the division. A
testing licensee shall not hold a license in another license category
of this chapter and shall not own or have ownership interest in a
facility licensed pursuant to this chapter.
19342. (a) For the purposes of testing medical cannabis or
medical cannabis products, licensees shall use a licensed testing
laboratory that has adopted a standard operating procedure using
methods consistent with general requirements for the competence of
testing and calibration activities, including sampling, using
standard methods established by the International Organization for
Standardization, specifically ISO/IEC 17020 and ISO/IEC 17025 to test
medical cannabis and medical cannabis products that are approved by
an accrediting body that is a signatory to the International
Laboratory Accreditation Cooperation Mutual Recognition Arrangement.
(b) An agent of a licensed testing laboratory shall obtain samples
according to a statistically valid sampling method for each lot.
(c) A licensed testing laboratory shall analyze samples according
to either of the following:
(1) The most current version of the cannabis inflorescence
monograph published by the American Herbal Pharmacopoeia.
(2) Scientifically valid methodology that is demonstrably equal or
superior to paragraph (1), in the opinion of the accrediting body.
(d) If a test result falls outside the specifications authorized
by law or regulation, the licensed testing laboratory shall follow a
standard operating procedure to confirm or refute the original
result.
(e) A licensed testing laboratory shall destroy the remains of the
sample of medical cannabis or medical cannabis product upon
completion of the analysis.
19343. A licensed testing laboratory shall not handle, test, or
analyze medical cannabis or medical cannabis products unless the
licensed testing laboratory meets all of the following:
(a) Is registered by the State Department of Public Health.
(b) Is independent from all other persons and entities involved in
the medical cannabis industry.
(c) Follows the methodologies, ranges, and parameters that are
contained in the scope of the accreditation for testing medical
cannabis or medical cannabis products. The testing lab shall also
comply with any other requirements specified by the State Department
of Public Health.
(d) Notifies the State Department of Public Health within one
business day after the receipt of notice of any kind that its
accreditation has been denied, suspended, or revoked.
(e) Has established standard operating procedures that provide for
adequate chain of custody controls for samples transferred to the
licensed testing laboratory for testing.
19344. (a) A licensed testing laboratory shall issue a
certificate of analysis for each lot, with supporting data, to report
both of the following:
(1) Whether the chemical profile of the lot conforms to the
specifications of the lot for compounds, including, but not limited
to, all of the following:
(A) Tetrahydrocannabinol (THC).
(B) Tetrahydrocannabinolic Acid (THCA).
(C) Cannabidiol (CBD).
(D) Cannabidiolic Acid (CBDA).
(E) The terpenes described in the most current version of the
cannabis inflorescence monograph published by the American Herbal
Pharmacopoeia.
(F) Cannabigerol (CBG).
(G) Cannabinol (CBN).
(H) Any other compounds required by the State Department of Public
Health.
(2) That the presence of contaminants does not exceed the levels
that are the lesser of either the most current version of the
American Herbal Pharmacopoeia monograph or the State Department of
Public Health. For purposes of this paragraph, contaminants includes,
but is not limited to, all of the following:
(A) Residual solvent or processing chemicals.
(B) Foreign material, including, but not limited to, hair,
insects, or similar or related adulterant.
(C) Microbiological impurity, including total aerobic microbial
count, total yeast mold count, P. aeruginosa, aspergillus spp., s.
aureus, aflatoxin B1, B2, G1, or G2, or ochratoxin A.
(D) Whether the batch is within specification for odor and
appearance.
(b) Residual levels of volatile organic compounds shall be below
the lesser of either the specifications set by the United States
Pharmacopeia (U.S.P. Chapter 467) or those set by the State
Department of Public Health.
19345. (a) Except as provided in this chapter, a licensed testing
laboratory shall not acquire or receive medical cannabis or medical
cannabis products except from a licensed facility in accordance with
this chapter, and shall not distribute, sell, deliver, transfer,
transport, or dispense medical cannabis or medical cannabis products,
from which the medical cannabis or medical cannabis products were
acquired or received. All transfer or transportation shall be
performed pursuant to a specified chain of custody protocol.
(b) A licensed testing laboratory may receive and test samples of
medical cannabis or medical cannabis products from a qualified
patient or primary caregiver only if he or she presents his or her
valid recommendation for cannabis for medical purposes from a
physician. A licensed testing laboratory shall not certify samples
from a qualified patient or caregiver for resale or transfer to
another party or licensee. All tests performed by a licensed testing
laboratory for a qualified patient or caregiver shall be recorded
with the name of the qualified patient or caregiver and the amount of
medical cannabis or medical cannabis product received.
(c) The State Department of Public Health shall develop procedures
to ensure that testing of cannabis occurs prior to delivery to
dispensaries or any other business, specify how often licensees shall
test cannabis and that the cost of testing shall be borne by the
licensed cultivators, and require destruction of harvested batches
whose testing samples indicate noncompliance with health and safety
standards promulgated by the State Department of Public Health,
unless remedial measures can bring the cannabis into compliance with
quality assurance standards as promulgated by the State Department of
Public Health.
(d) The State Department of Public Health shall establish a
licensing fee, and laboratories shall pay a fee to be licensed.
Licensing fees shall not exceed the reasonable regulatory cost of the
licensing activities.
19347. (a) Prior to delivery or sale at a dispensary, medical
cannabis products shall be labeled and in a tamper-evident package.
Labels and packages of medical cannabis products shall meet the
following requirements:
(1) Medical cannabis packages and labels shall not be made to be
attractive to children.
(2) All medical cannabis product labels shall include the
following information, prominently displayed and in a clear and
legible font:
(A) Manufacture date and source.
(B) The statement "SCHEDULE I CONTROLLED SUBSTANCE."
(C) The statement "KEEP OUT OF REACH OF CHILDREN AND ANIMALS" in
bold print.
(D) The statement "FOR MEDICAL USE ONLY."
(E) The statement "THE INTOXICATING EFFECTS OF THIS PRODUCT MAY BE
DELAYED BY UP TO TWO HOURS."
(F) The statement "THIS PRODUCT MAY IMPAIR THE ABILITY TO DRIVE OR
OPERATE MACHINERY. PLEASE USE EXTREME CAUTION."
(G) For packages containing only dried flower, the net weight of
medical cannabis in the package.
(H) A warning if nuts or other known allergens are used.
(I) List of pharmacologically active ingredients, including, but
not limited to, tetrahydrocannabinol (THC), cannabidiol (CBD), and
other cannabinoid content, the THC and other cannabinoid amount in
milligrams per serving, servings per package, and the THC and other
cannabinoid amount in milligrams for the package total.
(J) Clear indication, in bold type, that the product contains
medical cannabis.
(K) Identification of the source and date of cultivation and
manufacture.
(L) Any other requirement set by the bureau.
(M) Information associated with the unique identifier issued by
the Department of Food and Agriculture pursuant to Section 11362.777
of the Health and Safety Code.
(b) Only generic food names may be used to describe edible medical
cannabis products.
Article 14. Reporting
19353. Beginning on March 1, 2023, and on or before March 1 of
each following year, each licensing authority shall prepare and
submit to the Legislature an annual report on the authority's
activities and post the report on the authority's Internet Web site.
The report shall include, but not be limited to, the following
information for the previous fiscal year:
(a) The amount of funds allocated and spent by the licensing
authority for medical cannabis licensing, enforcement, and
administration.
(b) The number of state licenses issued, renewed, denied,
suspended, and revoked, by state license category.
(c) The average time for processing state license applications, by
state license category.
(d) The number and type of enforcement activities conducted by the
licensing authorities and by local law enforcement agencies in
conjunction with the licensing authorities or the bureau.
(e) The number, type, and amount of penalties, fines, and other
disciplinary actions taken by the licensing authorities.
19354. The bureau shall contract with the California Marijuana
Research Program, known as the Center for Medicinal Cannabis
Research, authorized pursuant to Section 11362.9 of the Health and
Safety Code, to develop a study that identifies the impact that
cannabis has on motor skills.
Article 15. Privacy
19355. (a) Information identifying the names of patients, their
medical conditions, or the names of their primary caregivers received
and contained in records kept by the office or licensing authorities
for the purposes of administering this chapter are confidential and
shall not be disclosed pursuant to the California Public Records Act
(Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1
of the Government Code), except as necessary for authorized employees
of the State of California or any city, county, or city and county
to perform official duties pursuant to this chapter, or a local
ordinance.
(b) Information identifying the names of patients, their medical
conditions, or the names of their primary caregivers received and
contained in records kept by the bureau for the purposes of
administering this chapter shall be maintained in accordance with
Chapter 1 (commencing with Section 123100) of Part 1 of Division 106
of the Health and Safety Code, Part 2.6 (commencing with Section 56)
of Division 1 of the Civil Code, and other state and federal laws
relating to confidential patient information.
(c) Nothing in this section precludes the following:
(1) Employees of the bureau or any licensing authorities notifying
state or local agencies about information submitted to the agency
that the employee suspects is falsified or fraudulent.
(2) Notifications from the bureau or any licensing authorities to
state or local agencies about apparent violations of this chapter or
applicable local ordinance.
(3) Verification of requests by state or local agencies to confirm
licenses and certificates issued by the regulatory authorities or
other state agency.
(4) Provision of information requested pursuant to a court order
or subpoena issued by a court or an administrative agency or local
governing body authorized by law to issue subpoenas.
(d) Information shall not be disclosed by any state or local
agency beyond what is necessary to achieve the goals of a specific
investigation, notification, or the parameters of a specific court
order or subpoena.
SEC. 5. Section 9147.7 of the Government Code is amended to read:
9147.7. (a) For the purpose of this section, "eligible agency"
means any agency, authority, board, bureau, commission, conservancy,
council, department, division, or office of state government, however
denominated, excluding an agency that is constitutionally created or
an agency related to postsecondary education, for which a date for
repeal has been established by statute on or after January 1, 2011.
(b) The Joint Sunset Review Committee is hereby created to
identify and eliminate waste, duplication, and inefficiency in
government agencies. The purpose of the committee is to conduct a
comprehensive analysis over 15 years, and on a periodic basis
thereafter, of every eligible agency to determine if the agency is
still necessary and cost effective.
(c) Each eligible agency scheduled for repeal shall submit to the
committee, on or before December 1 prior to the year it is set to be
repealed, a complete agency report covering the entire period since
last reviewed, including, but not limited to, the following:
(1) The purpose and necessity of the agency.
(2) A description of the agency budget, priorities, and job
descriptions of employees of the agency.
(3) Any programs and projects under the direction of the agency.
(4) Measures of the success or failures of the agency and
justifications for the metrics used to evaluate successes and
failures.
(5) Any recommendations of the agency for changes or
reorganization in order to better fulfill its purpose.
(d) The committee shall take public testimony and evaluate the
eligible agency prior to the date the agency is scheduled to be
repealed. An eligible agency shall be eliminated unless the
Legislature enacts a law to extend, consolidate, or reorganize the
eligible agency. No eligible agency shall be extended in perpetuity
unless specifically exempted from the provisions of this section. The
committee may recommend that the Legislature extend the statutory
sunset date for no more than one year to allow the committee more
time to evaluate the eligible agency.
(e) The committee shall be comprised of 10 members of the
Legislature. The Senate Committee on Rules shall appoint five members
of the Senate to the committee, not more than three of whom shall be
members of the same political party. The Speaker of the Assembly
shall appoint five members of the Assembly to the committee, not more
than three of whom shall be members of the same political party.
Members shall be appointed within 15 days after the commencement of
the regular session. Each member of the committee who is appointed by
the Senate Committee on Rules or the Speaker of the Assembly shall
serve during that committee member's term of office or until that
committee member no longer is a Member of the Senate or the Assembly,
whichever is applicable. A vacancy on the committee shall be filled
in the same manner as the original appointment. Three Assembly
Members and three Senators who are members of the committee shall
constitute a quorum for the conduct of committee business. Members of
the committee shall receive no compensation for their work with the
committee.
(f) The committee shall meet not later than 30 days after the
first day of the regular session to choose a chairperson and to
establish the schedule for eligible agency review provided for in the
statutes governing the eligible agencies. The chairperson of the
committee shall alternate every two years between a Member of the
Senate and a Member of the Assembly, and the vice chairperson of the
committee shall be a member of the opposite house as the chairperson.
(g) This section shall not be construed to change the existing
jurisdiction of the budget or policy committees of the Legislature.
(h) This section shall not apply to the Bureau of Medical
Marijuana Regulation.
SEC. 6. Section 11362.775 of the Health and Safety Code is amended
to read:
11362.775. (a) Subject to subdivision (b), qualified patients,
persons with valid identification cards, and the designated primary
caregivers of qualified patients and persons with identification
cards, who associate within the State of California in order
collectively or cooperatively to cultivate cannabis for medical
purposes, shall not solely on the basis of that fact be subject to
state criminal sanctions under Section 11357, 11358, 11359, 11360,
11366, 11366.5, or 11570.
(b) This section shall remain in effect only until one year after
the Bureau of Medical Marijuana Regulation posts a notice on its
Internet Web site that the licensing authorities have commenced
issuing licenses pursuant to the Medical Marijuana Regulation and
Safety Act (Chapter 3.5 (commencing with Section 19300) of Division 8
of the Business and Professions Code), and is repealed upon issuance
of licenses.
SEC. 7. Section 147.5 is added to the Labor Code, to read:
147.5. (a) By January 1, 2017, the Division of Occupational
Safety and Health shall convene an advisory committee to evaluate
whether there is a need to develop industry-specific regulations
related to the activities of facilities issued a license pursuant to
Chapter 3.5 (commencing with Section 19300) of Division 8 of the
Business and Professions Code.
(b) By July 1, 2017, the advisory committee shall present to the
board its findings and recommendations for consideration by the
board. By July 1, 2017, the board shall render a decision regarding
the adoption of industry-specific regulations pursuant to this
section.
SEC. 8. Section 31020 is added to the Revenue and Taxation Code,
to read:
31020. The board, in consultation with the Department of Food and
Agriculture, shall adopt a system for reporting the movement of
commercial cannabis and cannabis products throughout the distribution
chain. The system shall not be duplicative of the electronic
database administered by the Department of Food and Agriculture
specified in Section 19335 of the Business and Professions Code. The
system shall also employ secure packaging and be capable of providing
information to the board. This system shall capture, at a minimum,
all of the following:
(a) The amount of tax due by the designated entity.
(b) The name, address, and license number of the designated entity
that remitted the tax.
(c) The name, address, and license number of the succeeding entity
receiving the product.
(d) The transaction date.
(e) Any other information deemed necessary by the board for the
taxation and regulation of marijuana and marijuana products.
SEC. 9. The provisions of this act are severable. If any provision
of this act or its application is held invalid, that invalidity
shall not affect other provisions or applications that can be given
effect without the invalid provision or application.
SEC. 10. The Legislature finds and declares that Section 4 of this
act, which adds Section 19355 to the Business and Professions Code,
thereby imposes a limitation on the public's right of access to the
meetings of public bodies or the writings of public officials and
agencies within the meaning of Section 3 of Article I of the
California Constitution. Pursuant to that constitutional provision,
the Legislature makes the following findings to demonstrate the
interest protected by this limitation and the need for protecting
that interest:
The limitation imposed under this act is necessary for purposes of
compliance with the federal Health Insurance Portability and
Accountability Act of 1996 (42 U.S.C. Sec. 1320d et seq.), the
Confidentiality of Medical Information Act (Part 2.6 (commencing with
Section 56) of Division 1 of the Civil Code), and the Insurance
Information and Privacy Protection Act (Article 6.6 (commencing with
Section 791) of Part 2 of Division 1 of the Insurance Code).
SEC. 11. If the Commission on State Mandates determines that this
act contains costs mandated by the state, reimbursement to local
agencies and school districts for those costs shall be made pursuant
to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of
the Government Code.
SEC. 12. This act shall become operative only if Senate Bill 643
and Assembly Bill 243 of the 2015-16 Regular Session are also enacted
and become operative.