Sunset Regulated Marijuana

Regulated marijuana - reorganization - sunset - appropriation. The act makes changes to the retail and medical marijuana codes and continues those codes until 2028 with a sunset review prior to 2028. The act defines the terms, "advertising", "branding", and "consumer education materials". The act requires industrial hemp that is used in medical marijuana-infused products or retail marijuana products to be tested prior to manufacturing the product. The act allows retail marijuana stores to sell industrial hemp consumables. The act creates limits on the amount of medical marijuana flower, medical marijuana concentrate, and medical marijuana products that a medical marijuana store can sell to an individual in one day. For flower, the limit is 2 ounces; for concentrate, the limit is 20 grams; and for products, the limit is 20,000 milligrams. The act allows a physician to provide an exemption to the limits.

Under current law, there is an exception to the "Colorado Food and Drug Act" for medical marijuana but not one for retail marijuana. The act repeals the exception for medical marijuana.

The act streamlines the statutes related to license renewal by:

• Eliminating statutory timelines for local licensing and allowing local ordinance to determine the application timelines;
• Allowing a licensee that has submitted a timely renewal application to operate until the application is acted upon; and
• Repealing statutes related to the order in which state and local licenses must be processed.

Under current law, there are 2 separate licenses related to research: A research and development license and the research and development cultivation license. The act merges the 2 licenses into one.

The act gives the state licensing authorities the ability to seek injunctive relief and investigatory subpoenas from district courts related to nonlicensed entities.

Under current law, there is a broad grant of confidentiality to records and information related to licensees. The act provides similar protections to applicants, patients, and customers. The act also makes the following information that was confidential available to the public: Final agency actions, testing records on an aggregated and de-identified basis, applicant and licensee demographic information on an aggregated and de-identified basis, and enforcement forms and compliance checklists.

In both the medical marijuana code and the retail marijuana code, there are unlawful acts sections that create criminal violations, but the provisions in the 2 codes are not the same. The act makes the unlawful acts consistent.

The act makes it an unlawful act to engage in a regulated marijuana business without the proper license and to adulterate or alter samples of marijuana or marijuana products to circumvent testing requirements.

Under current law, a person is prohibited from being licensed if the person discharged a sentence for a felony within 5 years of applying for licensure or discharged a drug felony conviction within 10 years of applying for licensure. The act changes the law so a person is prohibited from licensure if the person was convicted of a felony within 3 years of applying for licensure or is currently serving a sentence for a felony or a deferred judgment or sentence.

The act creates the following new categories of ownership: Controlling beneficial owner, passive beneficial owner, and indirect financial interest holder.

Under current law, a patient who has submitted an application to be on the registry but has not received a patient card must present a copy of the application and a certified mail return receipt when purchasing medical marijuana at a center. The act repeals the requirement for a certified mail return receipt and requires proof of application.

The act directs the state licensing authorities to track information on license disqualifications based on criminal history.

Under current law, all medical marijuana sold at a medical marijuana center must be labeled with a list of chemical additives. Under current law, a medical marijuana-infused products manufacturer may only use medical marijuana from 5 different sources to produce a medical marijuana product. The act repeals these requirements. The act requires the state licensing authority to adopt rules that prevent redundant testing of medical marijuana concentrate for residual solvent when all of the inputs of the concentrate have passed the residual solvent testing.

The act creates 2 new retail marijuana license types: Accelerator cultivators and accelerator manufacturers. The accelerator licenses allow a cultivator and manufacturer to operate respectively on the premises of a licensed retail marijuana cultivation facility or retail marijuana products manufacturer. The accelerator licensee can receive technical, compliance, and capital assistance from the host-licensed retail marijuana business. A licensed business that hosts an accelerator licensee may be eligible for reduced licensing fees. Applications for the licenses may be filed beginning on July 1, 2020.

The act clarifies that a marijuana business licensee may hold a gaming license. The act requires that each medical marijuana and retail marijuana store post a warning sign related to the use of marijuana while pregnant or breastfeeding. The act allows a medical marijuana or retail marijuana cultivation facility that has approval to change locations from the state licensing authority to operate one license at 2 different locations while transitioning from the old location to the new location. The act allows marijuana licensees to transfer electronic marijuana waste to a person for the purposes of recycling or reuse.

The act allows retail marijuana stores, retail cultivation facilities, and retail marijuana products manufacturers to provide performance-based incentives to employees including sales-based, performance-based incentives to employees.

The act prohibits the open and public consumption of marijuana and allows local jurisdictions to make exceptions to the prohibition if the locations are not accessible to the public or a substantial number of the public without restriction. The prohibition does not apply to a licensed business that permits consumption on its premises if the business is operating with the conditions of its license.

The act states that marijuana business employees are not agricultural workers unless they are farm laborers. The act also states that, if it is determined that marijuana business are not covered by the national "Labor Relations Act", then employees of marijuana businesses are covered by the Colorado "Labor Peace Act".

The act allows regulated marijuana businesses to recycle marijuana consumer waste. The state licensing authority must treat a metered-dose inhaler the same as a vaporized delivery device for purposes of regulation and testing.

Under federal law, there may be negative immigration consequences for a person legally in the United States who works in the regulated marijuana industry. Prior to accepting an application for a license, registration, or permit, the state licensing authority shall inform the applicant that having a medical marijuana or retail marijuana license and working in the medical marijuana or retail marijuana industry may have adverse federal immigration consequences.

The act allows a medical marijuana or retail marijuana cultivation facility to obtain medical marijuana seeds or immature plants from its own medical marijuana, commonly owned from the retail marijuana of an identical direct beneficial owner, or marijuana that is properly transferred from another medical marijuana business pursuant to the inventory tracking requirements imposed by rule. Regulated marijuana employees can be compensated by performance-based incentives, including sales-based, performance-based incentives.

The act makes technical changes and repeals obsolete provisions.

The act combines the laws for regulated medical marijuana and retail marijuana, which are currently separate articles in title 44, into one article in title 44. The act incorporates the provisions of HB 19-1090, publicly traded regulated marijuana businesses, and HB 19-1234, regulated marijuana delivery, into the new consolidated article.

The act takes effect on January 1, 2020.

For the 2019-20 state fiscal year, $396,604 is appropriated from the marijuana cash fund to the department of revenue.

(Note: This summary applies to this bill as enacted.)