Humboldt Needs to Be Ready for AB 266

Janssen Malloy LLP represents a number of local wine and craft beer businesses and has become familiar with the regulatory and licensing rules that must be followed in order for businesses to comply with the law and succeed.  Those rules and regulations have not applied to the marijuana industry in California.  But comprehensive marijuana regulation was a matter of time in California.  The time may be now.  

This month, the California State Assembly gave initial approval to regulations to manage the state’s marijuana businesses in AB 266:  The Medical Cannabis Regulation and Control Act. The bill proposes an agency which will be known as the Governor’s Office of Marijuana Regulation.  

That agency will oversee licensing and regulation of commercial cannabis. The bill will standardize practices and products, requiring training and certification.  Dispensary licenses approved by local jurisdictions will be granted by the State.   
California had been the only state without comprehensive statewide regulations for medical marijuana, often relying on the attorney general guidelines.  The federal justice department has given direct guidance to California to come up with comprehensive guidelines, and it seems that California is about to do so.  Humboldt County needs to be ready.  The bill will require the following:

  1. Require anyone conducting “commercial cannabis activity” to get a license from one of several state agencies;
  2. Sets tiers for those licenses, leveling the playing field for small and large operations;
  3. Define cannabis as an agricultural product and put the Department of Agriculture in charge of cannabis cultivation;
  4. Put the Department of Public Health in charge of cannabis testing laboratory certification and product safety;
  5. Put the Board of Equalization in charge of dispensaries and transportation;
  6. Require the California Highway Patrol to set standards and figure out how to test for cannabis intoxication in drivers.

There would be separate licenses for growers, sellers, and transporters of cannabis. No entity would be allowed to have more than two licenses. 

The bill requires agencies to start setting up detailed rules — as in how much licenses would cost, a huge issue — in 2016, and to have the licensing in place by 2018. The bill would also protect medical cannabis patients’ abilities to grow small amounts of marijuana for no more than five people without having to get a license. Those patients would not, under these rules, be allowed to sell that marijuana without a permit.The bill bars anyone with a felony drug trafficking felony from acquiring a license.  

Please contact Janssen Malloy LLP if you would like to meet to discuss how you can be ready for the changes that are coming so that your business can follow the rules and succeed.