This bill is part of the 2021 Cannabis Bills section of our ongoing update on California Cannabis Legislation – see the full California Cannabis Law Legislative Update which includes information on cannabis bills from other years.
AB 141 Budget Act of 2021: Department of Cannabis Control: licensure: safety and quality assurance.
Existing law, the Control, Regulate and Tax Adult Use of Marijuana Act of 2016 (AUMA), an initiative measure approved as Proposition 64 at the November 8, 2016, statewide general election, authorizes a person who obtains a state license under AUMA to engage in commercial adult-use cannabis activity pursuant to that license and applicable local ordinances.
Existing law, the Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA), among other things, consolidates the licensure and regulation of commercial medicinal and adult-use cannabis activities. MAUCRSA generally divides responsibility for the state licensure and regulation of commercial cannabis activity among the Bureau of Cannabis Control in the Department of Consumer Affairs, the Department of Food and Agriculture, and the State Department of Public Health.
This bill would establish the Department of Cannabis Control within the Business, Consumer Services, and Housing Agency, would transfer to this department the powers, duties, purposes, functions, responsibilities, and jurisdiction of the bureau, the Department of Food and Agriculture, and the State Department of Public Health under MAUCRSA, except as specified, and would make conforming changes. The bill would require the department to be under the supervision and control of a director.
MAUCRSA defines commercial cannabis activity for purposes of the act to include the cultivation, possession, manufacture, distribution, processing, storing, laboratory testing, packaging, labeling, transportation, delivery, or sale of cannabis and cannabis products as provided for in MAUCRSA. MAUCRSA defines “manufacture” for purposes of the act to mean to compound, blend, extract, infuse, or otherwise make or prepare a cannabis product. MAUCRSA defines “manufacturer” for purposes of the act to mean a licensee that conducts the production, preparation, propagation, or compounding of cannabis or 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 cannabis or cannabis products or labels or relabels its container.
This bill would revise the definition of “commercial cannabis” to include acting as a cannabis event organizer for temporary cannabis events. The bill would revise the definition of “manufacture” to include packaging or labeling a cannabis product. The bill would remove the definition of “manufacturer.”
MAUCRSA authorizes licensing authorities to create, issue, deny, renew, discipline, suspend, or revoke licenses.
This bill would require the Department of Cannabis Control to provide information on its internet website related to the status of every license issued by the department, including the county of a licensee’s address of record. The bill would require, beginning January 1, 2022, this information to include information on suspensions and revocations of licenses and final decisions adopted by the department. The bill would prohibit the sharing of personal identifying information, including home addresses, home telephone numbers, dates of birth, or social security numbers.
MAUCRSA, until January 1, 2022, authorizes a licensing authority, in its sole discretion, to issue a provisional license if the applicant has submitted a completed license application to the licensing authority, including evidence that compliance with the California Environmental Quality Act or local cannabis ordinances is underway, if applicable, as specified.
This bill, instead, would authorize the Department of Cannabis Control to issue provisional licenses until June 30, 2022. For an application for a new provisional license that includes cultivation activities, the bill would require an applicant to submit certain documentation to the department regarding a lake or streambed alteration agreement. The bill would also prohibit the department from renewing a provisional license under certain circumstances, including if the applicant does not submit certain documentation regarding a lake or streambed alteration agreement. The bill would also prohibit the department from issuing a provisional cultivation license if the application is submitted after January 1, 2022, and the provisional license would cause a licensee to hold multiple cultivation licenses on contiguous premises to exceed a specified size. The bill would prohibit the department from renewing a provisional cultivation license if the license would cause a licensee to hold multiple cultivation licenses on contiguous premises to exceed a specified size. The bill would, as of January 1, 2024, terminate any provisional cultivation license that causes a licensee to hold multiple cultivation licenses on contiguous premises to exceed a specified size. The bill would prohibit the department from renewing a provisional license after January 1, 2025, and would provide that no provisional license shall be effective after January 1, 2026. The bill would extend the operative date of these provisional license provisions to January 1, 2026. By extending provisional licensure, the applications for which are required to be signed under penalty of perjury, the bill would expand the scope of the crime of perjury, and would thereby impose a state-mandated local program.
MAUCRSA requires the Department of Food and Agriculture to establish a program for cannabis, and requires the State Department of Public Health to establish a certification program for manufactured cannabis products, that are comparable to the federal National Organic Program and the California Organic Food and Farming Act. Existing law makes the authority to establish these programs inoperative if the federal National Organic Program authorizes organic designation and certification for cannabis. Existing law prohibits a person from representing, selling, or offering for sale any cannabis or cannabis products as organic or with the designation or certification established by the Department of Food and Agriculture or the State Department of Public Health, except as provided.
This bill would authorize the Department of Food and Agriculture and the State Department of Public Health to collect fees to cover the reasonable regulatory costs of performing the duties relating to their respective programs and to levy civil penalties, and to deny, suspend, or revoke a registration or certification issued pursuant those programs, for specified violations. The bill would require the penalties or fees collected by the Department of Food and Agriculture to be deposited in the Department of Food and Agriculture Fund and would require the penalties or fees collected by the State Department of Public Health to be deposited in the Food Safety Fund.
MAUCRSA requires the Department of Food and Agriculture, no later than January 1, 2021, to establish a process by which licensed cultivators may establish appellations of origin for cannabis produced in certain geographical areas of California, instead of by county or city.
This bill would authorize the Department of Food and Agriculture to collect fees to cover the reasonable regulatory costs of performing the duties relating to the appellation of origin provisions for geographical areas of the state. The bill would require these fees to be deposited in the Department of Food and Agriculture Fund.
Existing law requires certain state agencies to obtain written consent from the Attorney General before employing legal counsel to represent those agencies in certain judicial or administrative adjudicative proceedings and before contracting with outside counsel.
This bill would exempt the Department of Cannabis Control from the above-described requirement except in proceedings in state and federal court.
Existing law makes it a crime to possess an assault weapon, and a crime to possess or manufacture, distribute, transport, import for sale, keep for sale, offer or expose for sale, or give or lend any .50 BMG rifle. Under existing law, these prohibitions on assault weapons and .50 BMG rifles do not apply to the sale to, purchase by, importation of, or possession by specified entities, including the Department of Corrections and Rehabilitation and the Department of the California Highway Patrol.
This bill would add the Department of Cannabis Control to the list of exempted entities.
Existing law prohibits the manufacture, importation, sale, or transfer of an unsafe handgun, as defined. Existing law exempts from this prohibition sales to specified law enforcement agencies or other specified government agencies for use by specified employees and sales to specified peace officers. Existing law further requires that the sale of an unsafe handgun to certain specified entities, including a county probation department, and members of those entities, is only authorized if the handgun is to be used as a service weapon by a peace officer who has successfully completed the basic course prescribed by the Commission on Peace Officer Standards and Training (POST) and who qualifies with the handgun, as specified, at least every 6 months.
This bill would add the Department of Cannabis Control to the list of entities to which an unsafe handgun may be sold if the unsafe handgun is to be used as a service weapon by a peace officer as described.
MAUCRSA, for purposes of the California Cannabis Equity Act, defines local equity program as a program adopted or operated by a local jurisdiction that focuses on inclusion and support of individuals and communities in California’s cannabis industry who are linked to populations or neighborhoods that were negatively or disproportionately impacted by cannabis criminalization, as specified. MAUCRSA requires the bureau to administer a grant program to assist a local jurisdiction with the development of a local equity program or to assist local equity applicants and local equity licensees through a local equity program, as specified. MAUCRSA authorizes the bureau to enter into an interagency agreement with the Governor’s Office of Business and Economic Development (GO-Biz) to administer the grant program, and grants GO-Biz all powers and authority granted to the bureau in specified provisions related to administering the grant program, as specified.
This bill instead would require GO-Biz to administer the grant program. The bill would also authorize the Governor to appoint a deputy director of equity and inclusion to the Department of Cannabis Control.
AUMA establishes the California Cannabis Tax Fund as a continuously appropriated fund consisting of specified taxes, interest, penalties, and other amounts imposed by AUMA. AUMA requires the Controller to make certain disbursements from the fund, including the reasonable costs incurred by the licensing authorities for implementing, administering, and enforcing MAUCRSA, as specified.
This bill additionally would require the Controller to disburse from the California Cannabis Tax Fund, without regard to fiscal year, the reasonable costs incurred by GO-Biz for implementing, administering, and enforcing the California Cannabis Equity Act.
MAUCRSA requires the bureau to convene an advisory committee to advise the licensing authorities on the development of standards and regulations pursuant to MAUCRSA.
This bill would require advisory committee members to be reimbursed from the Cannabis Control Fund for travel and other necessary expenses incurred in the performance of their duties.
MAUCRSA requires an applicant for a license to require each owner to electronically submit to the Department of Justice fingerprint images and specified related information for the purpose of obtaining certain criminal history information. MAUCRSA authorizes the licensing authorities to obtain and receive, at their discretion, criminal history information from the Department of Justice and the Federal Bureau of Investigation for an applicant.
This bill, instead, would authorize the Bureau of Cannabis Control, the Department of Food and Agriculture, the State Department of Public Health, and the Department of Cannabis Control to obtain that criminal history information. The bill would authorize these state agencies to request and receive from a local or state agency certified records of all arrests and convictions, certified records regarding probation, and any and all other related documentation needed to complete an applicant or licensee investigation. This bill would authorize a local or state agency to provide those records to those state agencies upon request. The bill, until July 1, 2022, would authorize employees of those state agencies acting on behalf of the department to receive the criminal history information of applicants.
MAUCRSA prohibits the disclosure of certain medical information, received and contained in records kept by the office or licensing authorities for the purposes of administering certain provisions of MAUCRSA, except as specified. MAUCRSA provides that this prohibition does not preclude notifications from a licensing authority to state or local agencies about apparent violations of an applicable local ordinance or a MAUCRSA provision relating to records of commercial cannabis activity.
This bill instead would provide that the prohibition does not preclude notifications from a licensing authority to state or local agencies about apparent violations of an applicable local ordinance or any MAUCRSA provision.
Existing law requires the Bureau of Cannabis Control to disclose information on its licensees.
This bill would repeal that requirement.
MAUCRSA requires a licensing authority to deny an application if either the applicant, or the premises for which a license is applied, do not qualify for licensure under MAUCRSA. MAUCRSA also authorizes a licensing authority to deny the application for licensure or renewal of a license for, among other reasons, failure or inability to comply with the provisions of MAUCRSA.
This bill would authorize the department to institute or continue a proceeding against an applicant who has withdrawn their application after it has been filed with the department, for the denial of the license upon any ground provided by law or to enter an order denying the license upon any ground.
If a licensee is found to have committed an act or omission constituting grounds for disciplinary action, MAUCRSA authorizes the licensing authority that issued the license to discipline the license and fine the licensee after proper notice and hearing to the licensee.
This bill would authorize the department to suspend a license before a hearing, as specified, if the license was acquired due to fraud, misrepresentation, deceit, or any material misstatement of fact in the application for the license.
This bill would authorize the department to institute or continue a disciplinary proceeding against a person whose license has been suspended, forfeited, or canceled by order of the department or by order of a court of law, or has been surrendered without the written consent of the department, upon any ground provided by law or to enter an order suspending or revoking the license or otherwise taking disciplinary action against the licensee on any such ground.
MAUCRSA establishes the Cannabis Control Appeals Panel in the Business, Consumer Services, and Housing Agency and authorizes any person aggrieved by specified decisions of a licensing authority related to disciplining any license to appeal the licensing authority’s written decision to the panel. Existing administrative law establishes an executive director of the panel. MAUCRSA requires the Director of the Department of Consumer Affairs to furnish the equipment, supplies, and housing necessary for the authorized activities of the panel and to perform such other mechanics of administration as the panel and the director may agree upon.
This bill would instead require the executive director of the panel to furnish those equipment, supplies, and housing and to perform such other mechanics of administration as determined by the panel.
MAUCRSA authorizes an agent of a licensing authority to possess, transport, or obtain cannabis or cannabis products as necessary to conduct activities reasonably related to the duties of the licensing authority.
This bill would authorize an agent of a state or local agency to possess, transport, or obtain cannabis or cannabis products as necessary to conduct activities reasonably related to the duties of the state or local agency.
MAUCRSA prohibits cannabis and cannabis products from being sold unless a representative sample of specified batches has been tested by a licensed testing laboratory. MAUCRSA requires the testing laboratory to issue a certificate of analysis for selected lots of each batch to report specified information, including whether the chemical profile of the sample conforms to the labeled content of compounds. MAUCRSA requires a testing laboratory to destroy the remains of a sample of medical cannabis or medical cannabis product upon completion of the analysis.
This bill would also require the testing laboratory to destroy the remains of a sample of adult-use cannabis or adult-use cannabis product upon completion of the analysis.
MAUCRSA requires the bureau to develop procedures to require the destruction of harvested batches whose testing samples indicate noncompliance with certain health and safety standards, unless remedial measures can bring the cannabis or cannabis products into compliance with specified quality assurance standards. MAUCRSA defines harvest batch to mean a specifically identified quantity of dried flower or trim, leaves, and other cannabis plant matter that is uniform in strain, harvested at the same time, and, if applicable, cultivated using the same pesticides and other agricultural chemicals.
This bill would remove from that definition the specification that the cannabis plant matter be uniform in strain.
MAUCRSA requires the bureau to develop procedures to ensure that a testing laboratory employee takes the sample of cannabis or cannabis products from the distributor’s premises for the required testing and that the testing laboratory employee transports the sample to the testing laboratory.
This bill would require the driver transporting the sample to be directly employed by the testing laboratory.
MAUCRSA, beginning January 1, 2018, authorizes a licensee to sell cannabis or cannabis products that have not been tested for a limited and finite time, as specified.
This bill would delete this provision.
This bill would authorize a testing laboratory to receive and test samples of cannabis or cannabis products from a licensed manufacturer or licensed cultivator for quality control purposes, and not for retail sale.
MAUCRSA prohibits a person that holds a state testing laboratory license from licensure for any other commercial cannabis activity. MAUCRSA prohibits a person that holds a state testing laboratory license from employing an individual who is also employed by any other cannabis licensee that does not hold a state testing laboratory license.
This bill would prohibit a person with a financial interest in a state testing laboratory license from holding a financial interest in any other type of cannabis license.
MAUCRSA places restrictions on the packaging and labeling of cannabis and cannabis products, including requiring that cannabis and cannabis products, prior to delivery or sale at retail, be labeled and placed in a resealable, tamper-evident, child-resistant package.
This bill would only require the packaging to be resealable if the cannabis or cannabis product contains multiple servings.
MAUCRSA requires all cannabis and cannabis product labels and inserts to include, among other things, identification of the source and date of cultivation and the date of manufacture and packaging.
This bill would remove the requirement that the labels and inserts include the source and date of cultivation and the date of manufacture.
MAUCRSA prohibits the manufacturing, sale, delivery, holding, or offering for sale of cannabis and cannabis products that are misbranded. MAUCRSA also prohibits the receipt in commerce of a cannabis product that is misbranded or delivery or offering to deliver a misbranded cannabis product. MAUCRSA defines “misbranded” for this purpose to include cannabis and cannabis products that are manufactured, packed, or held in this state in a manufacturing premises not duly licensed under MAUCRSA.
This bill would additionally prohibit the cultivation or processing of cannabis or cannabis products that are misbranded. The bill would prohibit the receipt in commerce of cannabis that is misbranded and the distribution of misbranded cannabis product. The bill would additionally include in the definition of “misbranded” cannabis or cannabis products that are, or consist of cannabis or cannabis products that are, cultivated, processed, manufactured, packed, or held in a location that is not licensed pursuant to MAUCRSA. By expanding the definition of crimes, this bill would impose a state-mandated local program.
MAUCRSA prohibits the manufacture, sale, delivery, holding, or offering for sale of a cannabis product that is adulterated and prohibits the adulteration of a cannabis product. MAUCRSA prohibits the receiving in commerce of a cannabis product that is adulterated or the delivery or proffered for delivery of an adulterated cannabis product. MAUCRSA defines “adulterated” for this purpose, including that the methods, facilities, or controls used for the manufacture, packing, or holding do not conform to the requirements of MAUCRSA, as specified.
This bill would additionally prohibit the cultivation of cannabis that is adulterated, the adulteration of cannabis, the distribution of cannabis or cannabis products that are adulterated, and the delivery or proffering for delivery of an adulterated cannabis product. The bill would include in the definition of “adulterated” for this purpose cannabis where the methods, facilities, or controls used for its cultivation do not conform with the requirements of MAUCRSA. By expanding the definition of crimes, this bill would impose a state-mandated local program.
MAUCRSA specifies the procedures for the State Department of Public Health to require a manufacturer to cease distribution of cannabis products and recall cannabis products that it determines are adulterated or misbranded. MAUCRSA authorizes the State Department of Public Health to affix a tag or other marking to cannabis that has been embargoed as adulterated or misbranded and prohibits the removal or disposal of the embargoed cannabis product until given permission by the department.
This bill would include cannabis in this procedure and would authorize a licensee to voluntarily recall the affected cannabis or cannabis product and either remediate or destroy the product. The bill would authorize a licensed cultivator to request permission for continued cultivation or harvesting of cannabis subject to embargo and would authorize the department to impose conditions on the continued cultivation and harvest of embargoed cannabis. The bill would prohibit the correction of cannabis or cannabis products found at an unlicensed location or cultivated, processed, produced, or manufactured at an unlicensed location and would require the destruction of that embargoed cannabis or cannabis product.
MAUCRSA prohibits a licensee from giving away any amount of cannabis or cannabis product as part of a business promotion or other commercial activity.
This bill would require the Department of Cannabis Control to adopt regulations authorizing a licensee to designate cannabis or a cannabis product as a trade sample at any time while the cannabis or cannabis product is in the possession of the licensee, and would require the regulations to include a definition of trade sample and the quantity of cannabis and cannabis products that may be designated as trade samples. The bill would allow cannabis or cannabis products designated as trade samples to be given for targeted advertising, and would authorize the department to adopt regulations specifying additional purposes. The bill would require the trade samples to be subject to quality assurance and testing, recorded into the track and trace program, and labeled. The bill would authorize the trade samples to be transported between 2 licensees by specified employees. The bill would prohibit any payment, consideration, cost, or compensation in exchange for any cannabis or cannabis products designated as trade samples. The bill would have the provisions related to trade samples take effect upon adoption of regulations by the Department of Cannabis Control, as specified.
MAUCRSA imposes an excise tax on the purchase of cannabis and cannabis products, as defined, at the rate of 15% of the average market price of any retail sale by a cannabis retailer. AUMA additionally imposes a cultivation tax on all harvested cannabis that enters the commercial market upon all cultivators and requires a distributor or a manufacturer to collect that tax from a cultivator, as specified. Existing law requires the California Department of Tax and Fee Administration to administer both taxes.
This bill would require that the excise provisions not be construed to impose an excise tax on cannabis or cannabis products designated a trade sample.
This bill, on and after January 1, 2022, would exempt from the cultivation tax the cultivation of all harvested cannabis that has been, or will be, designated a trade sample and all harvested cannabis that is used to manufacture a cannabis product that is designated a trade sample. This bill would require the California Department of Tax and Fee Administration to adopt regulations prescribing the procedures for how the exemption will be implemented.
This bill would appropriate $10,000 from the General Fund to the Department of Cannabis Control for purposes of implementing the provisions of the bill.
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 no reimbursement is required by this act for a specified reason.
AUMA authorizes the Legislature to amend its provisions with a 2/3 vote of both houses to further its purposes and intent.
This bill would state that the bill furthers the purposes and intent of AUMA.
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.
This bill would declare that it is to take effect immediately as a bill providing for appropriations related to the Budget Bill.
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