California Bills To Authorize Interstate Marijuana Commerce And Seal Records Head To Governor, With More Reforms Pending

California bills to set up the framework for interstate marijuana commerce, streamline record sealing for cannabis convictions, safeguard firms that provide insurance to businesses in the legal industry and more are heading to the governor’s desk.

There’s been a blizzard of cannabis legislation advancing through the legislature in recent weeks as the end of the session approaches, and several other bills are still pending, such as one that would prohibit localities from banning medical marijuana deliveries and another providing employment protections for people who use cannabis off the job.

But in recent days, lawmakers have given final passage a number of key reforms that are now being transmitted to Gov. Gavin Newsom (D).

Among the most notable of those measures are SB 1326 from Sen. Anna Caballero (D) and AB 1706 from Assemblymember Mia Bonta (D).

The former bill would set the stage to allow for interstate marijuana commerce from California to and from other legal states, contingent on an official assurance that the activity would not put the state at risk of federal enforcement action.

It advanced through the Assembly Appropriations Committee on the same week that New Jersey’s Senate president filed a bill to allow interstate cannabis commerce under similar circumstances. Then it moved through the full chamber before the final version was concurred with by the Senate on Thursday in a 28-9 vote.

Meanwhile, Bonta’s legislation is meant to enhance justice reform provisions of the state’s marijuana law by mandating the courts to process record sealing and other forms of relief for people with eligible cannabis convictions on their records in a specific timeframe. Courts would have until March 1, 2023 to seal records for qualifying cases that weren’t challenged by July 1, 2020.

The bill was amended in the Senate to change reporting requirements on record sealing from monthly to quarterly, and then it passed the full chamber earlier this month before heading back to the Assembly for concurrence. It passed that chamber unanimously on Thursday, sending it to the governor.

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Another measure heading to Newsom’s desk is AB 2568, sponsored by Assemblymember Ken Cooley (D). The legislation would “provide it is not a crime solely for individuals and firms to provide insurance and related services to persons licensed to engage in commercial cannabis activity,” according to a summary.

It passed unanimously in both chambers of the legislature, first in the Senate in May and then in the Assembly on Thursday.

Meanwhile, AB 1954 from Assemblymember Bill Quirk (D) is already on the governor’s desk after being enacted and enrolled in the legislature.

The legislation would make it so doctors could not discriminate against patients by denying medication or treatment based on a positive THC test if the person is a registered medical cannabis patient in the state. It further stipulates that medical professionals couldn’t be penalized for administering treatment to a patient who uses medical marijuana in compliance with state law.

SB 1097 from Sen. Richard Pan (D), a bill dealing with marijuana product labeling, moved through an Assembly committee this month after clearing the Senate in May. But while it advanced to the Assembly floor, it was pulled from further consideration before it received a third reading.

It would have required the state Department of Cannabis Control (DCC) to “adopt regulations to require cannabis and cannabis product labels and inserts to include a clear and prominent warning regarding the risks that cannabis use may contribute to mental health problems, in addition to existing labeling requirements.”

The California Cannabis Industry Association (CCIA) and other marijuana trade groups opposed the measure, arguing that the state already has robust labeling requirements in place.

“In order to comply with the additional requirements of SB 1097, legal operators will be forced to raise their prices,” CCIA said in an action alert. “Higher prices in the legal market will push consumers to the illicit market, where products are either not labeled, misleadingly labeled, or laced with other toxic, unregulated additives.”

Kevin Sabet, president of the prohibitionist group Smart Approaches to Marijuana (SAM), attributed the decision to withdraw the legislation to pressure from the industry, which he argued “cannot be underestimated in their relentless pursuit to damage public health.”

For those who say: “Regulate it. Put warning labels on weed, no one will oppose that.”

Think again: A bill to do just that was pulled in California just now.

Big Tobacco & Big Pot cannot be underestimated in their relentless pursuit to damage public health.

— Kevin Sabet (@KevinSabet) August 22, 2022

The legislative session ends on August 31, and there are still other cannabis reform bills in play. Here are some other notable measures that could still be sent to Newsom’s desk this year:

SB 1186: Sen. Scott Wiener’s (D) legislation would “prohibit a local jurisdiction from adopting or enforcing any regulation that prohibits the retail sale by delivery within the local jurisdiction of medicinal cannabis to medicinal cannabis patients or their primary caregivers by medicinal cannabis businesses.”

AB 2188: Quirk’s bill would “make it unlawful for an employer to discriminate against a person in hiring, termination, or any term or condition of employment, or otherwise penalize a person” solely because of off-duty marijuana use. It would eliminate employment-based THC testing, with exceptions for certain positions, such as federal employees or those working in construction.

AB 1885: The bill from Assemblymember Ash Kalra (D) would prohibit regulators from penalizing licensed veterinarians who recommend medical cannabis for animals and revise state law to include definitions for marijuana products intended for animal consumption. The Veterinary Medical Board would also be required to create guidelines for veterinarian cannabis recommendations.

AB 1014: This measure would amend state law to create additional, minimum security and transportation requirements for cannabis delivery services. It’s being sponsored by Assemblymember Kevin McCarty (D).

Newsom has a long record of supporting marijuana reform and backing the state’s market, so he’s generally expected to sign these measures. But despite his record, he recently vetoed a key piece of drug policy reform legislation from Wiener that would have authorized a safe drug consumption site pilot program in the state—a move that’s prompted widespread criticism from the harm reduction community.

San Francisco officials have since signaled that they’re prepared to defy the governor and launch an overdose prevention program regardless of the veto.

In another disappointment for reform advocates, a separate Wiener bill that would have legalized possession of limited amounts of certain psychedelics was recently pulled by the sponsor after its main provisions were gutted, leaving just a study component that advocates say is unnecessary given the existing body of scientific literature on the subject.

Here’s an overview of other recent drug policy developments in California:

Last month, California officials awarded more than $1.7 million in grants help promote sustainable marijuana cultivation practices and assist growers with obtaining their annual licenses. A total of $6 million will be allotted through the program, which was first announced in August 2021 and will remain open for applications through April 2023.

Regulators also recently announced that they are soliciting input on proposed rules to standardize cannabis testing methods in the state—an effort that they hope will stop marijuana businesses from “laboratory shopping” to find facilities that are more likely to show higher THC concentrations that they can then boast for their products.

Meanwhile, California officials are distributing another round of community reinvestment grants totaling $35.5 million with tax revenue generated from recreational marijuana sales.

The Governor’s Office of Business and Economic Development (GO-Biz) announced last month that they’ve awarded 78 grants to organizations throughout the state that will support economic and social development in communities disproportionately impacted by the war on drugs.

The amount of funding and number of recipients increased from last year’s levels, when the state awarded about $29 million in grants to 58 nonprofit organizations through the CalCRG program.

California has taken in nearly $4 billion in marijuana tax revenue since the state’s adult-use market launched in 2018, the Department of Tax and Fee Administration (CDTFA) reported late last month. And for the first quarter of 2022, the state saw about $294 million in cannabis revenue generated from the excise, cultivation and sales tax on marijuana.

The state collected about $817 million in adult-use marijuana tax revenue during the last fiscal year. That represented 55 percent more cannabis earnings for state coffers than was generated in the 2020-2021 period.

California officials also announced in January that the state had awarded $100 million in funding to help develop local marijuana markets, in part by getting cannabis businesses fully licensed.

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Photo courtesy of Mike Latimer.