On Friday, the California Senate and Assembly voted to approve the Medical Marijuana Regulation and Safety Act, marking a big step toward regulating cannabis in California. We’ve consistently written about the need for California to get its regulatory act together, and though this piece of legislation is not perfect, it addresses many of the primary concerns that accompanied an industry filled with legal uncertainty. You can read more about California’s cannabis legal issues here:
- California’s Cannabis Conundrum
- The “Why” Behind California’s Battle to Legalize Marijuana
- Los Angeles Marijuana: The Uphill Battle of Proposition D
- California’s New Law to Address Environmental Devastation Caused by Illegal Marijuana Grows
- California Cannabis and the Feds: The Harborside Health Case
Because The Medical Marijuana Regulation and Safety Act is lengthy and complicated, I will provide some highlights:
- The Bureau of Medical Marijuana Governance, together with the Department of Consumer Affairs and the Department of Food and Agriculture are tasked with implementing and enforcing the Act.
- All commercial cannabis activity, as defined in the Act, must be licensed by both the state and local government. Individuals growing cannabis for their own use, and primary caregivers who provide cannabis to no more than five specified qualified patients are exempt from this licensing requirement.
- Local jurisdictions will retain their power to regulate above and beyond the minimum threshold established by the Act. This means that local bans and moratoria will likely stay in place. It also provides leeway for cities like Los Angeles to continue implementing their own marijuana legislation, like Proposition D.
- Applicants must pass a rigorous background check. The criminal history requirements are more stringent than what was required in Washington State, for example.
- The State will license testing laboratories, and all marijuana and marijuana products must be tested to state standards, including potency, pesticides, mold and other contaminants.
- There will be ten different types of cultivation licenses, four types of licensed dispensaries, distributors and transporters, and three types of manufacturers and laboratories. This is the most complex and multi-layered licensing scheme we’ve seen.
- The bureau will adopt a medical marijuana track and trace process for reporting the movement of all product through the distribution chain. All licensees must participate once the system is operational.
- Appropriately licensed dispensaries will be allowed to make deliveries.
These points are only the tip of the iceberg, and everyone conducting business in the marijuana industry in California should familiarize themselves with the Act. The final regulatory framework must be in place by January 1, 2017, and it will be important for business owners to determine what they can do now to position themselves for success in the licensing process.