AB 1686: Adult-use cannabis and medicinal cannabis: licenses: application: labor peace agreement.
- Session Year: 2017-2018
- House: Assembly
- Latest Version Date: 2017-07-19
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 marijuana activity, which does not include commercial medical cannabis activity, adult-use cannabis activity pursuant to that license and applicable local ordinances. AUMA 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 marijuana cannabis activity among the Department of Consumer Affairs, the Department of Food and Agriculture, and the State Department of Public Health and requires those state licensing authorities to begin issuing licenses by January 1, 2018. AUMA authorizes the Legislature to amend its provisions with a 2/3 vote of both houses to further its purposes and intent.
MCRSAMAUCRSA requires an applicant for a MCRSA MAUCRSA license with 20 or more employees to provide the licensing authority with a statement that the applicant will enter into, or demonstrate that it has already entered into, and abide by the terms of a labor peace agreement. MCRSA MAUCRSA requires an applicant for a MCRSA MAUCRSA license to provide the licensing authority with a statement, signed by the applicant under penalty of perjury, that the information provided is complete, true, and accurate. AUMA requires an applicant for an AUMA license to comply with these requirements.
This bill would require that the statement relating to the labor peace agreement be signed, notarized, and submitted electronically. The bill would authorize an applicant to submit a physical copy of the labor peace agreement in the event that the licensing authority does not have the ability to receive electronic copies of labor peace agreements.
This bill would declare that its provisions implement specified substantive provisions of AUMA. The bill would also declare that its provisions further specified purposes and intent of that act.
The Medical Cannabis Regulation and Safety Act (MCRSA) requires a person to obtain both a local and state license to engage in commercial medical cannabis activities, but authorizes, until January 1, 2018, a facility or entity that is operating in compliance with local laws to continue in operation until its application for licensure is approved or denied. MCRSA generally divides responsibility for the state licensure and regulation of commercial medical cannabis activity among the Department of Consumer Affairs, the Department of Food and Agriculture, and the State Department of Public Health.
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 marijuana activity, which does not include commercial medical cannabis activity, pursuant to that license and applicable local ordinances. AUMA generally divides responsibility for the state licensure and regulation of commercial marijuana activity among the Department of Consumer Affairs, the Department of Food and Agriculture, and the State Department of Public Health and requires those state licensing authorities to begin issuing licenses by January 1, 2018. AUMA authorizes the Legislature to amend its provisions with a 2/3 vote of both houses to further its purposes and intent.
MCRSA requires an applicant for a MCRSA license with 20 or more employees to provide the licensing authority with a statement that the applicant will enter into, or demonstrate that it has already entered into, and abide by the terms of a labor peace agreement. MCRSA requires an applicant for a MCRSA license to provide the licensing authority with a statement, signed by the applicant under penalty of perjury, that the information provided is complete, true, and accurate. AUMA requires an applicant for an AUMA license to comply with these requirements.
This bill would require that the statement relating to the labor peace agreement be signed, notarized, and submitted electronically.
This bill would declare that its provisions implement specified substantive provisions of AUMA. The bill would also declare that its provisions further specified purposes and intent of that act.
The Planning and Zoning Law requires a city or county to adopt a comprehensive, long-term general plan that includes various mandatory elements, including a housing element. That law requires the housing element to contain, among other things, an assessment of housing needs and an inventory of resources and constraints relevant to meeting those needs. That law further requires the Department of Housing and Community Development to determine the existing and projected need for housing for each region, as specified. Under existing law, the due dates for the determination of each regions housing needs may be extended by the department by not more than 60 days if the extension will enable access to more recent critical population or housing data from a pending or recent release of the United States Census Bureau or the Department of Finance, as specified.This bill would instead authorize the department to extend that period by not more than 75 days.The Planning and Zoning Law requires a city or county to adopt a comprehensive, long-term general plan that includes various mandatory elements, including a housing element. That law requires the housing element to contain, among other things, an assessment of housing needs and an inventory of resources and constraints relevant to meeting those needs. That law further requires the Department of Housing and Community Development to determine the existing and projected need for housing for each region, as specified. Under existing law, the due dates for the determination of each regions housing needs may be extended by the department by not more than 60 days if the extension will enable access to more recent critical population or housing data from a pending or recent release of the United States Census Bureau or the Department of Finance, as specified.
This bill would instead authorize the department to extend that period by not more than 75 days.
(a)An applicant for any type of state license issued pursuant to this division shall do all of the following:
(1)Require that each owner of the applicant electronically submit to the Department of Justice fingerprint images and related information required by the Department of Justice for the purpose of obtaining information as to the existence and content of a record of state or federal convictions and arrests, and information as to the existence and content of a record of state or federal convictions and arrests for which the Department of Justice establishes that the person is free on bail or on his or her own recognizance, pending trial or appeal.
(A)The Department of Justice shall provide a response to the licensing authority pursuant to paragraph (1) of subdivision (p) of Section 11105 of the Penal Code.
(B)The licensing authority shall request from the Department of Justice subsequent notification service, as provided pursuant to Section 11105.2 of the Penal Code, for applicants.
(C)The Department of Justice shall charge the applicant a fee sufficient to cover the reasonable cost of processing the requests described in this paragraph.
(2)Provide evidence of the legal right to occupy and use the proposed location and provide a statement from the landowner of real property or that landowners agent where the commercial cannabis activity will occur, as proof to demonstrate the landowner has acknowledged and consented to permit commercial cannabis activities to be conducted on the property by the tenant applicant.
(3)Provide evidence that the proposed location is in compliance with subdivision (b) of Section 26054.
(4)Provide a statement, signed by the applicant under penalty of perjury, that the information provided is complete, true, and accurate.
(5)(A)For an applicant with 20 or more employees, provide a electronically submit to the licensing authority a signed and notarized statement that the applicant will enter into, or demonstrate that it has already entered into, and abide by the terms of a labor peace agreement. An applicant may submit a physical copy of the labor peace agreement in the event that the licensing authority does not have the ability to receive electronic copies of labor peace agreements.
(B)For the purposes of this paragraph, employee does not include a supervisor.
(C)For the purposes of this paragraph, supervisor means an individual having authority, in the interest of the applicant, to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or responsibility to direct them or to adjust their grievances, or effectively to recommend such action, if, in connection with the foregoing, the exercise of that authority is not of a merely routine or clerical nature, but requires the use of independent judgment.
(6)Provide the applicants valid sellers permit number issued pursuant to Part 1 (commencing with Section 6001) of Division 2 of the Revenue and Taxation Code or indicate that the applicant is currently applying for a sellers permit.
(7)Provide any other information required by the licensing authority.
(8)For an applicant seeking a cultivation license, provide a statement declaring the applicant is an agricultural employer, as defined in the Alatorre-Zenovich-Dunlap-Berman Agricultural Labor Relations Act of 1975 (Part 3.5 (commencing with Section 1140) of Division 2 of the Labor Code), to the extent not prohibited by law.
(9)Pay all applicable fees required for licensure by the licensing authority.
(10)Provide proof of a bond to cover the costs of destruction of cannabis or cannabis products if necessitated by a violation of licensing requirements.
(b)An applicant shall also include in the application a detailed description of the applicants operating procedures for all of the following, as required by the licensing authority:
(1)Cultivation.
(2)Extraction and infusion methods.
(3)The transportation process.
(4)Inventory procedures.
(5)Quality control procedures.
(6)Security protocols.
(7)For applicants seeking licensure to cultivate, the source or sources of water the applicant will use for cultivation, as provided in subdivisions (a) to (c), inclusive, of Section 26060.1. For purposes of this paragraph, cultivation as used in Section 26060.1 shall have the same meaning as defined in Section 26001. The Department of Food and Agriculture shall consult with the State Water Resources Control Board and the Department of Fish and Wildlife in the implementation of this paragraph.
(c)The applicant shall also provide a complete detailed diagram of the proposed premises wherein the license privileges will be exercised, with sufficient particularity to enable ready determination of the bounds of the premises, showing all boundaries, dimensions, entrances and exits, interior partitions, walls, rooms, and common or shared entryways, and include a brief statement or description of the principal activity to be conducted therein, and, for licenses permitting cultivation, measurements of the planned canopy, including aggregate square footage and individual square footage of separate cultivation areas, if any, roads, water crossings, points of diversion, water storage, and all other facilities and infrastructure related to the cultivation.
(d)Provide a complete list of every person with a financial interest in the person applying for the license as required by the licensing authority. For purposes of this subdivision, persons with a financial interest does not include persons whose only interest in a licensee is an interest in a diversified mutual fund, blind trust, or similar instrument.
SEC. 2.The Legislature finds and declares that Section 1 of this act, amending Section 26056 26051.5 of the Business and Professions Code by amending cross-referenced Section 19322 of the Business and Professions Code, implements Section 6.1 of the Control, Regulate and Tax Adult Use of Marijuana Act, and that it is consistent with and furthers the purposes of the act as stated in Section 3 of that act.
(a)A person shall not submit an application for a state license issued by a licensing authority pursuant to this chapter unless that person has received a license, permit, or authorization from the local jurisdiction. An applicant for any type of state license issued pursuant to this chapter shall do all of the following:
(1)Electronically submit to the Department of Justice fingerprint images and related information required by the Department of Justice for the purpose of obtaining information as to the existence and content of a record of state or federal convictions and arrests, arrests and information as to the existence and content of a record of state or federal convictions and arrests for which the Department of Justice establishes that the person is free on bail or on his or her own recognizance, pending trial or appeal.
(A)The Department of Justice shall provide a response to the licensing authority pursuant to paragraph (1) of subdivision (p) of Section 11105 of the Penal Code.
(B)The licensing authority shall request from the Department of Justice subsequent notification service, as provided pursuant to Section 11105.2 of the Penal Code, for applicants.
(C)The Department of Justice shall charge the applicant a fee sufficient to cover the reasonable cost of processing the requests described in this paragraph.
(2)Provide documentation issued by the local jurisdiction in which the proposed business is operating certifying that the applicant is or will be in compliance with all local ordinances and regulations.
(3)Provide evidence of the legal right to occupy and use the proposed location. For an applicant seeking a cultivator, distributor, manufacturing, testing, transporter, or dispensary license, provide a statement from the owner of real property or their agent where the cultivation, distribution, manufacturing, testing, transport, or dispensing of commercial medical cannabis activities will occur, as proof to demonstrate the landowner has acknowledged and consented to permit cultivation, distribution, manufacturing, testing, transport, or dispensary activities to be conducted on the property by the tenant applicant.
(4)If the application is for a cultivator or a dispensary, provide evidence that the proposed location is located beyond at least a 600-foot radius from a school, as required by Section 11362.768 of the Health and Safety Code.
(5)Provide a statement, signed by the applicant under penalty of perjury, that the information provided is complete, true, and accurate.
(6)(A)For an applicant with 20 or more employees, provide electronically submit to the licensing authority a signed and notarized statement that the applicant will enter into, or demonstrate that it has already entered into, and abide by the terms of a labor peace agreement.
(B)For the purposes of this paragraph, employee does not include a supervisor.
(C)For purposes of this paragraph, supervisor means an individual having authority, in the interest of the licensee, to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or responsibility to direct them or to adjust their grievances, or effectively to recommend such action, if, in connection with the foregoing, the exercise of that authority is not of a merely routine or clerical nature, but requires the use of independent judgment.
(7)Provide the applicants valid sellers permit number issued pursuant to Part 1 (commencing with Section 6001) of Division 2 of the Revenue and Taxation Code or indicate that the applicant is currently applying for a sellers permit.
(8)Provide any other information required by the licensing authority.
(9)For an applicant seeking a cultivation license, provide a statement declaring the applicant is an agricultural employer, as defined in the Alatorre-Zenovich-Dunlap-Berman Agricultural Labor Relations Act of 1975 (Part 3.5 (commencing with Section 1140) of Division 2 of the Labor Code), to the extent not prohibited by law.
(10)Pay all applicable fees required for licensure by the licensing authority.
(11)Provide proof of a bond to cover the costs of destruction of medical cannabis or medical cannabis products if necessitated by a violation of licensing requirements.
(b)For applicants seeking licensure to cultivate, distribute, manufacture, test, or dispense medical cannabis or medical cannabis products, the application shall also include a detailed description of the applicants operating procedures for all of the following, as required by the licensing authority:
(1)Cultivation.
(2)Extraction and infusion methods.
(3)The transportation process.
(4)Inventory procedures.
(5)Quality control procedures.
(6)Security protocols.
SEC. 2.The Legislature finds and declares that Section 1 of this act, amending Section 26056 of the Business and Professions Code by amending cross-referenced Section 19322 of the Business and Professions Code, implements Section 6.1 of the Control, Regulate and Tax Adult Use of Marijuana Act, and that it is consistent with and furthers the purposes of the act as stated in Section 3 of that act.
SECTION 1.Section 65584 of the Government Code is amended to read:65584.(a)(1)For the fourth and subsequent revisions of the housing element pursuant to Section 65588, the department shall determine the existing and projected need for housing for each region pursuant to this article. For purposes of subdivision (a) of Section 65583, the share of a city or county of the regional housing need shall include that share of the housing need of persons at all income levels within the area significantly affected by the general plan of the city or county.(2)While it is the intent of the Legislature that cities, counties, and cities and counties should undertake all necessary actions to encourage, promote, and facilitate the development of housing to accommodate the entire regional housing need, it is recognized, however, that future housing production may not equal the regional housing need established for planning purposes.(b)The department, in consultation with each council of governments, shall determine each regions existing and projected housing need pursuant to Section 65584.01 at least two years prior to the scheduled revision required pursuant to Section 65588. The appropriate council of governments, or for cities and counties without a council of governments, the department, shall adopt a final regional housing need plan that allocates a share of the regional housing need to each city, county, or city and county at least one year prior to the scheduled revision for the region required by Section 65588. The allocation plan prepared by a council of governments shall be prepared pursuant to Sections 65584.04 and 65584.05 with the advice of the department.(c)Notwithstanding any other provision of law, the due dates for the determinations of the department or for the council of governments, respectively, regarding the regional housing need may be extended by the department by not more than 75 days if the extension will enable access to more recent critical population or housing data from a pending or recent release of the United States Census Bureau or the Department of Finance. If the due date for the determination of the department or the council of governments is extended for this reason, the department shall extend the corresponding housing element revision deadline pursuant to Section 65588 by not more than 75 days.(d)The regional housing needs allocation plan shall be consistent with all of the following objectives:(1)Increasing the housing supply and the mix of housing types, tenure, and affordability in all cities and counties within the region in an equitable manner, which shall result in each jurisdiction receiving an allocation of units for low- and very low income households.(2)Promoting infill development and socioeconomic equity, the protection of environmental and agricultural resources, and the encouragement of efficient development patterns.(3)Promoting an improved intraregional relationship between jobs and housing.(4)Allocating a lower proportion of housing need to an income category when a jurisdiction already has a disproportionately high share of households in that income category, as compared to the countywide distribution of households in that category from the most recent decennial United States census.(e)For purposes of this section, household income levels are as determined by the department as of the most recent decennial census pursuant to the following code sections:(1)Very low incomes as defined by Section 50105 of the Health and Safety Code.(2)Lower incomes, as defined by Section 50079.5 of the Health and Safety Code.(3)Moderate incomes, as defined by Section 50093 of the Health and Safety Code.(4)Above moderate incomes are those exceeding the moderate-income level of Section 50093 of the Health and Safety Code.(f)Notwithstanding any other provision of law, determinations made by the department, a council of governments, or a city or county pursuant to this section or Section 65584.01, 65584.02, 65584.03, 65584.04, 65584.05, 65584.06, 65584.07, or 65584.08 are exempt from the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code).(a)(1)For the fourth and subsequent revisions of the housing element pursuant to Section 65588, the department shall determine the existing and projected need for housing for each region pursuant to this article. For purposes of subdivision (a) of Section 65583, the share of a city or county of the regional housing need shall include that share of the housing need of persons at all income levels within the area significantly affected by the general plan of the city or county.
(2)While it is the intent of the Legislature that cities, counties, and cities and counties should undertake all necessary actions to encourage, promote, and facilitate the development of housing to accommodate the entire regional housing need, it is recognized, however, that future housing production may not equal the regional housing need established for planning purposes.
(b)The department, in consultation with each council of governments, shall determine each regions existing and projected housing need pursuant to Section 65584.01 at least two years prior to the scheduled revision required pursuant to Section 65588. The appropriate council of governments, or for cities and counties without a council of governments, the department, shall adopt a final regional housing need plan that allocates a share of the regional housing need to each city, county, or city and county at least one year prior to the scheduled revision for the region required by Section 65588. The allocation plan prepared by a council of governments shall be prepared pursuant to Sections 65584.04 and 65584.05 with the advice of the department.
(c)Notwithstanding any other provision of law, the due dates for the determinations of the department or for the council of governments, respectively, regarding the regional housing need may be extended by the department by not more than 60 75 days if the extension will enable access to more recent critical population or housing data from a pending or recent release of the United States Census Bureau or the Department of Finance. If the due date for the determination of the department or the council of governments is extended for this reason, the department shall extend the corresponding housing element revision deadline pursuant to Section 65588 by not more than 60 75 days.
(d)The regional housing needs allocation plan shall be consistent with all of the following objectives:
(1)Increasing the housing supply and the mix of housing types, tenure, and affordability in all cities and counties within the region in an equitable manner, which shall result in each jurisdiction receiving an allocation of units for low- and very low income households.
(2)Promoting infill development and socioeconomic equity, the protection of environmental and agricultural resources, and the encouragement of efficient development patterns.
(3)Promoting an improved intraregional relationship between jobs and housing.
(4)Allocating a lower proportion of housing need to an income category when a jurisdiction already has a disproportionately high share of households in that income category, as compared to the countywide distribution of households in that category from the most recent decennial United States census.
(e)For purposes of this section, household income levels are as determined by the department as of the most recent decennial census pursuant to the following code sections:
(1)Very low incomes as defined by Section 50105 of the Health and Safety Code.
(2)Lower incomes, as defined by Section 50079.5 of the Health and Safety Code.
(3)Moderate incomes, as defined by Section 50093 of the Health and Safety Code.
(4)Above moderate incomes are those exceeding the moderate-income level of Section 50093 of the Health and Safety Code.
(f)Notwithstanding any other provision of law, determinations made by the department, a council of governments, or a city or county pursuant to this section or Section 65584.01, 65584.02, 65584.03, 65584.04, 65584.05, 65584.06, 65584.07, or 65584.08 are exempt from the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code).
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Date
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Status
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|---|---|
| Sep 1, 2017 | In committee: Held under submission. |
| Aug 21, 2017 | In committee: Referred to APPR. suspense file. |
| Jul 19, 2017 | From committee chair, with author's amendments: Amend, and re-refer to committee. Read second time, amended, and re-referred to Com. on APPR. |
| Jun 27, 2017 | From committee: Do pass and re-refer to Com. on APPR. (Ayes 8. Noes 1.) (June 26). Re-referred to Com. on APPR. |
| Jun 1, 2017 | Referred to Com. on B., P. & E.D. |
| May 18, 2017 | In Senate. Read first time. To Com. on RLS. for assignment. |
| May 18, 2017 | Read third time. Passed. Ordered to the Senate. (Ayes 69. Noes 0. Page 1620.) |
| May 11, 2017 | Read second time. Ordered to Consent Calendar. |
| May 10, 2017 | From committee: Do pass. To Consent Calendar. (Ayes 17. Noes 0.) (May 10). |
| Apr 26, 2017 | From committee: Do pass and re-refer to Com. on APPR. with recommendation: To Consent Calendar. (Ayes 15. Noes 0.) (April 25). Re-referred to Com. on APPR. |
| Apr 17, 2017 | From committee: Be re-referred to Com. on B. & P. Re-referred. (Ayes 9. Noes 0.) (April 17). Re-referred to Com. on B. & P. |
| Apr 6, 2017 | Re-referred to Com. on RLS. pursuant to Assembly Rule 96. |
| Apr 4, 2017 | Re-referred to Com. on H. & C.D. |
| Apr 3, 2017 | From committee chair, with author's amendments: Amend, and re-refer to Com. on H. & C.D. Read second time and amended. |
| Mar 16, 2017 | Referred to Coms. on H. & C.D. and L. GOV. |
| Feb 19, 2017 | From printer. May be heard in committee March 21. |
| Feb 17, 2017 | Read first time. To print. |
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Date
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Description
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Location
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Votes
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|---|---|---|---|---|
| Aug 21, 2017 | Placed on suspense file | Senate Standing Committee on Appropriations |
Passed |
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| Jun 26, 2017 | Do pass, but first be re-referred to the Committee on [Appropriations] | Senate Standing Committee on Business, Professions and Economic Development |
Passed |
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| May 18, 2017 | AB 1686 GLORIA Consent Calendar Second Day Regular Session | Assembly Floor |
Passed |
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| May 10, 2017 | Do pass. To Consent Calendar. | Assembly Standing Committee on Appropriations |
Passed |
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| Apr 25, 2017 | Do pass and be re-referred to the Committee on [Appropriations] with recommendation: To Consent Calendar | Assembly Standing Committee on Business and Professions |
Passed |
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| Apr 17, 2017 | Be re-referred to the Committee on [Business and Professions] | Assembly Standing Committee on Rules |
Passed |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
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Organization
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Position
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Date
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|---|---|---|
| Drug Policy Alliance | ** Support | Jun 22, 2017 |
| United Food and Commercial Workers | * Support | Jun 26, 2017 |
SENATE COMMITTEE ON APPROPRIATIONS
Senator Ricardo Lara, Chair
2017 - 2018 Regular Session
AB 1686 (Gloria) - Adult-use cannabis and medicinal cannabis: licenses: application: labor peace agreement
Version: July 19, 2017 | Policy Vote: B., P. & E.D. 8 - 1 |
Urgency: No | Mandate: No |
Hearing Date: August 21, 2017 | Consultant: Brendan McCarthy |
This bill does not meet the criteria for referral to the Suspense File.
Bill Summary:
AB 1686 would require a labor peace agreement to be submitted electronically to the Bureau of Cannabis Control.
Fiscal Impact:
- One-time costs of $12,000 and ongoing costs of $10,000 per year for information technology changes and document storage by the Bureau of Cannabis Control (Cannabis Control Fund).
- Similar costs are anticipated for the Department of Public Health and the Department of Food and Agriculture (Cannabis Control Fund).
Background:
The Medical Cannabis Regulation and Safety Act (MCRSA) was enacted by the legislature to regulate the production and sale of medical cannabis. The MCRSA created a regulatory structure and licensing requirements for a variety of entities involved in the production, distribution, and sale of medical cannabis.
The Control, Regulate, and Tax Adult Use of Marijuana Act (AUMA, Proposition 64 of 2016) legalized the sale, possession, and use of marijuana for individuals over the age of 21. The AUMA created a regulatory structure for the recreational marijuana industry, similar to that created under the MCRSA, but with some differences in licensing requirements.
SB 94 (Committee on Budget and Fiscal Review, Statutes of 2017) consolidated and harmonized the requirements of the two bodies of law relating to both medicinal and recreational cannabis (and changed the official terminology to cannabis).
Under current law, a “labor peace agreement” is an agreement between a licensee and a labor organization that spells out the permissible interactions between the employer, employees, and the labor organization. Generally, labor peace agreements prohibit strikes by workers, but also allow a labor organization access to employees for the purpose of organizing.
Current law requires a cannabis licensee with more than twenty employees to have a labor peace agreement in place as a condition of licensure.
Proposed Law:
AB 1686 would require a labor peace agreement to be submitted electronically to the cannabis licensing authority. The bill would allow the submission of a physical document if the licensing authority does not have the ability to receive electronic submissions.
Related Legislation:
There are a number of other bills that generally relate to cannabis and its regulation that will be heard in this committee.
-- END --
SENATE COMMITTEE ON
BUSINESS, PROFESSIONS AND ECONOMIC DEVELOPMENT
Senator Jerry Hill, Chair
2017 - 2018 Regular
Bill No: Hearing Date: June 26, 2017
Author: | |||
Version: | April 3, 2017 | ||
Urgency: | No | Fiscal: | Yes |
Consultant: | Sarah Huchel | ||
Subject:
SUMMARY:
Requires a labor peace agreement statement to be signed, notarized, and electronically submitted for a state medical cannabis license.
Existing law:
- Establishes the Bureau of Marijuana Control (Bureau) under the Department of Consumer Affairs to regulate the medical and recreational cannabis industry. (Business and Professions Code (BPC) § 26010)
- Establishes parameters for the regulation of medical cannabis via the Medical Cannabis Regulation and Safety Act (Act). (BPC § 19300)
- Defines a “labor peace agreement” (LPA) as an agreement between a licensee and any 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. (BPC § 19300.5 (w))
- Requires an applicant for any type of state cannabis license to provide to a licensing authority specifed information, including: (BPC § 19322)
- For an applicant with 20 or more employees, a statement that the applicant will enter into, or demonstrate that it has already entered into, and abide by, the terms of a LPA.
- A statement, signed by the applicant under penalty of perjury, that the information provided is complete, true, and accurate.
This bill:
- Requires an applicant for a state medical marijuana license to electronically submit a signed and notarized statement that the applicant will enter into, or demonstrate that it has already entered into, and abide by the terms of a LPA.
- Makes technical changes.
- States legislative findings and declarations that this bill is consistent with and furthers the purposes of the Act.
FISCAL EFFECT:
This bill is keyed fiscal by Legislative Counsel. According to the Assembly Appropriations Committee analysis dated May 10, 2017, this bill has one-time information technology costs of $3,000 and minor ongoing electronic data storage costs, not likely to exceed $10,000 to the Bureau (Marijuana Control Fund).
COMMENTS:
- Purpose. This bill is sponsored by the United Food and Commercial Workers, Western States Council. According to the Author’s office, “Since January 2017, over 150 LPAs have been submitted by cannabis business operators to local governments as part of their application to receive a permit to operate. An estimated 10-15% submitted were falsely signed, or not legitimate.
“This will create a more efficient and transparent licensure process and further enhance compliance by cannabis operators. Moreover the electronic submission of LPAs will also reduce unnecessary handling of paper and allow for a central archive of LPAs.”
- Background. California law currently requires an applicant for a cannabis license to submit to the licensing authority a signed statement that the applicant will enter into, or demonstrate that it has already entered into, and abide by the terms of a LPA. Current law also requires a statement, signed by the applicant under penalty of perjury, that the information provided is complete, true, and accurate.
The Bureau is planning to accept electronic documents toward licensure by January 1, 2018, but its licensing technology is not yet functional.
This bill requires the LPA statement to be signed, notarized, and electronically submitted.
- Notaries Public. A notary public is an official appointed by the Secretary of State to serve the public as an impartial witness in performing a variety of official fraud-deterrent acts related to the signing of important documents. These official acts are called notarizations. Notaries are publicly commissioned as “ministerial” officials, meaning that they are expected to follow written rules without the exercise of significant personal discretion, as would otherwise be the case with a “judicial” official.
A notary public completes a certificate of acknowledgment or jurat verifying only the identity of the individual who signed the document to which the certificate is attached, and not the truthfulness, accuracy, or validity of that document. The certificate of acknowledgment or jurat is executed by the notary under penalty of perjury.
California notaries public are authorized under current law to perform notarizations on documents electronically as long as all the requirements for a traditional paper-based notarial act are met, including the use of a seal for all but two specific documents used in real estate transactions. This means the party must be physically present before the notary public, and a video image or other form of non-physical representation is not a personal appearance in front of a notary public under California law.
- Related Legislation. AB 1700 (Cooper) requires an applicant for a medical cannabis license to provide a statement that the applicant employs, or will employ within one year of receiving a license, an employee who has successfully completed an OSHA 10-hour general industry course. (Status: This bill is currently pending in the Senate Business, Professions, and Economic Development Committee.)
- Arguments in Support. The Drug Policy Alliance and the United Food and Commercial Workers, Western States Council writes, “By adding extra safeguards- requiring all LPAs be signed, notarized, and electronically submitted will deter fraudulent behavior and make the process more efficient and transparent.”
- Policy Considerations. Existing law currently requires all individuals to submit as part of a cannabis license application a “statement, signed by the applicant under penalty of perjury; that the information provided is complete, true, and accurate.” This means that the applicant is already attesting that his or her LPA statement is true and accurate, at the risk of spending up to four years in jail. It is unclear whether the additional requirement of a notarized LPA will significantly change compliance.
SUPPORT AND OPPOSITION:
Support:
United Food and Commercial Workers, Western States Council (Sponsor)
Drug Policy Alliance
Opposition:
None on file as of June 20, 2017.
-- END --
Date of Hearing: May 10, 2017
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez Fletcher, Chair
ABPCA Bill Id:AB 1686
Author:(Gloria) – As Amended Ver:April 3, 2017
Policy Committee: | Business and Professions | Vote: | 15 - 0 |
Urgency: No State Mandated Local Program: No Reimbursable: No
SUMMARY:
This bill requires cannabis-related licensee applicants that must submit labor peace agreements (LPAs) under existing law to submit electronically a signed and notarized statement to fulfill this requirement.
FISCAL EFFECT:
One-time information technology costs of $3,000 and minor ongoing electronic data storage costs, not likely to exceed $10,000 to the Bureau of Medical Cannabis Regulation (Marijuana Control Fund).
COMMENTS:
- Purpose. According to the author, submitting labor peace agreements electronically to state agencies will greatly enhance the approval process for cannabis businesses to receive a license and create efficiencies between jurisdictional agencies to ensure compliance among applicants for licensure. This bill is sponsored by the United Food and Commercial Workers (UFCW).
- Background. Pursuant to voter propositions, medical and non-medical use of marijuana (also called cannabis) is now legal in the state. Beginning on January 1, 2018, the state is to issue licenses for cultivation, manufacturing, retail sale, transportation, storage, delivery and testing of medical and non-medical marijuana.
- Submission of an LPA is a current requirement. Current law prescribes eleven steps for licensure of cannabis-related businesses. These include transmission of fingerprints, submission to a background check, and fees, as well as a requirement that applicants with more than 20 employees submit a statement that the applicant will enter into or demonstrate that it has already entered into a labor peace agreement. The language in this bill would set a standard for the submission of that statement, specifically that it must be signed, notarized, and submitted electronically.
Analysis Prepared by: Lisa Murawski / APPR. / (916) 319-2081
Date of Hearing:
ASSEMBLY COMMITTEE ON BUSINESS AND PROFESSIONS
Evan Low, Chair
ABPCA Bill Id:AB 1686
Author:(Gloria) – As Amended Ver:April 3, 2017
SUBJECT: Nonmedical marijuana and medical cannabis: licenses: application: labor peace agreement.
SUMMARY: Under the Medical Cannabis Regulation and Safety Act (MCRSA), applicants with more than 20 employees seeking licensure to engage in marijuana related business must submit to the licensing authority a statement that the applicant will enter into or demonstrate that it has already entered into a labor peace agreement. This bill would require that the applicant submit electronically a signed and notarized statement to fulfill this requirement.
EXISTING LAW:
- Establishes the Bureau of Marijuana Control, also referred to as the Bureau of Medical Cannabis Regulation (Bureau), under the Department of Consumer Affairs (DCA), to establish a comprehensive system to control and regulate the cultivation, distribution, transport, storage, manufacturing, processing, and sale of cannabis products. (Business and Professions Code (BPC) Section 26000 et seq.; BPC Section 19302)
- Sets requirements for licensure of marijuana related businesses, including the requirement that applicants with more than 20 employees seeking licensure to engage in marijuana related business must submit to the licensing authority a statement that the applicant will enter into or demonstrate that it has already entered into a labor peace agreement. (BPC Section 19322)
THIS BILL:
- Requires that applicants for marijuana related licenses, electronically submit a signed and notarized statement to fulfill the requirement in existing law that applicants with more than 20 employees seeking licensure to engage in marijuana related business must submit to the licensing authority a statement that the applicant will enter into or demonstrate that it has already entered into a labor peace agreement. This statement must be signed, notarized, and submitted electronically to the licensing authority.
FISCAL EFFECT: Unknown. This bill has been keyed fiscal by the Legislative Counsel.
COMMENTS:
Purpose. This bill is sponsored by the United Food and Commercial Workers (UFCW). According to the author, “As a former City Council Member of the City of San Diego, I’ve led many initiatives to improve bureaucratic processes, advance efficiency among departments, enhance transparency, and reduce paper waste. The submission of Labor Peace Agreements electronically to state agencies will greatly enhance the approval process for Cannabis Businesses to receive a license and create efficiencies between jurisdictional agencies to ensure compliance among applicants for licensure.”
Background. History of Legal Cannabis in California. In 1996, California voters passed Proposition 215, legalizing the use of medical cannabis (MC).. In October 2015, nearly 20 years after the authorization of the use of MC, Governor Jerry Brown signed into law a trio of bills [AB 243 (Wood), Chapter 688, Statutes of 2015, AB 266 (Bonta, Cooley, Jones-Sawyer, Lackey, and Wood), Chapter 689, Statutes of 2015, and SB 643 (McGuire), Chapter 719, Statutes of 2015] collectively known as MCRSA. MCRSA established the state's first regulatory framework for MC. In 2016, the voters of California passed Proposition 64, the Adult Use of Marijuana Act (AUMA), to legalize the recreational use of cannabis in the state by 2018.
As of 2016, 28 states, the District of Columbia, and Guam allow MC programs. Though California was the first to authorize the medical use of cannabis, it was the only state that allowed cannabis use without a robust state regulatory framework until passage of MCRSA. States with MC laws generally have a form of patient registry, which may provide some protection against arrest for possession of up to a certain amount of cannabis for personal medicinal use. A limited number of states restrict MC usage to products with low to zero THC and high CBD concentrations, in an effort to more strictly limit the use of THC due to its known psychoactive effects. To date, eight states, Alaska, Colorado, Oregon, Washington, California, Nevada, Massachusetts, Maine, and the District of Columbia have legalized recreational cannabis.
Under AUMA, the Department of Consumer Affairs (DCA), continues to serve as the lead regulatory agency for all cannabis, both medical and non-medical, and renames the existing Bureau of Medical Cannabis Regulation as the Bureau of Marijuana Control. AUMA includes 19 different license types compared to the 17 in MCRSA and authorizes DCA (and the Bureau) the exclusive authority to create and regulate a license for transportation of cannabis.
While the language of AUMA allows for modifications to the law by majority vote of the legislature, any legislative changes inconsistent with the original intent of the law may require voter approval.
Applicants for Licensure. Current law prescribes 11 steps for licensure of marijuana related businesses. These include transmission of fingerprints, submission to a background check, and fees as well as a requirement that applicants with more than 20 employees seeking licensure to engage in marijuana related business must submit to the licensing authority a statement that the applicant will enter into or demonstrate that it has already entered into a labor peace agreement. The language in this bill would set a standard for the submission of that statement, specifically that it must be signed, notarized, and submitted electronically.
Digital Signatures. According to a 2014 Techradar article, digital signatures are being adopted by businesses all over the world, gradually displacing pen and paper processes. This is due to the benefits offered by digital signatures, including: security, resistant to fraud, compliance with a wide variety of legislation and standards, less time wasted collating signatures, reduced costs around paper, and print and transporting documents for signing. Some proponents of digital signatures have advocated for the use of this tool, arguing that it is more secure and significantly more challenging to commit fraud or forgery.
Electronic signatures can be provided by externally-managed, third-party services using proprietary technology, creating serious security, portability and usability limitations.
A digital signature, also known as an advanced, standard or secure electronic signature, is based on industry standards and offers high levels of security and acceptance.
Digital signatures are the result of a cryptographic operation that creates a 'fingerprint' unique to both the signer and the content, so that they cannot be copied, forged or tampered with.
This process provides proof of signer identity and data integrity for eliminating the possibility of anyone repudiating the signed documents. All this information can be easily verified using widely available applications such as Microsoft Office and most PDF readers.
Current Related Legislation. AB 64 (Bonta, Cooley, Jones-Sawyer, Lackey, Wood) of the current Legislative Session seeks to reconcile a number of differences between MCRSA and AUMA to provide clarity in regulation and enforcement of both medical and recreational cannabis. STATUS: This bill was passed by the Assembly Committee on Business and Professions on April 18, 2017 and referred to the Committee on Appropriations.
ARGUMENTS IN SUPPORT:
The United Food and Commercial Workers Union writes; “Since January 2017, over 150 LPA’s have been submitted by cannabis business operators to local governments
as part of their application to receive a permit to operate. An estimated 10-15% that have been submitted were falsely signed or illegitimate. Furthermore, there are no safeguards currently in place to ensure that all signatures are legal and valid. By adding extra safeguards- requiring all LPA’s be signed, notarized, and electronically submitted will deter fraudulent behavior and make the process more efficient and transparent.
ARGUMENTS IN OPPOSITION:
None on file
IMPLEMENTATION ISSUES:
While this bill simply specifies a particular mode of transmission for the statement required under current law, it is unclear by which means electronic submission is to take place. The author is encouraged to work with the appropriate licensing authorities to ensure that they are equipped to handle this provision.
Based on the author’s concern for fraud and the noted securities against fraud in the use of digital signatures, the author may wish to consider the allowance of the use of digital signatures in addition to a notary.
REGISTERED SUPPORT:
United Food and Commercial Workers Union
REGISTERED OPPOSITION:
None on file
Analysis Prepared by: Jimmy Fremgen and Genna Promnick / B. & P. / 916-319-3301
Discussed in Hearing
7MIN
Senate Standing Committee on Business, Professions and Economic Development
Bill Author
Bill Co-Author(s):