California Loosens Rules Separating Adult-use and Medical Cannabis Businesses

CALIFORNIA AGENCIES ANNOUNCE PROPOSED READOPTION OF EMERGENCY REGULATIONS

States largest organization of cannabis growers and business owners celebrates progress while calling attention to the magnitude of work still to do.

Source: California’s Growers Association

SACRAMENTO – The Bureau of Cannabis Control, California Department of Public Health and California Department of Food and Agriculture have proposed readopting their emergency cannabis regulations for an additional 180-day period. The three licensing authorities are proposing some changes to regulatory provisions to provide greater clarity to licensees and to address issues that have arisen since the emergency regulations went into effect.

Highlighted among the proposed changes is that applicants may now complete one license application and obtain one license to conduct medicinal and adult-use cannabis activity. Additionally, licensees may continue to engage in commercial cannabis activities with other licensees regardless of designation beyond the end of the transition period on July 1, 2018.

“These proposed changes to our emergency regulations are based on feedback from our stakeholders, and information gathered over the first four months of implementation,” said Bureau of Cannabis Control Chief Lori Ajax.

The Bureau has facilitated a public process with several meetings throughout the state that included active representation from all three licensing agencies and dozens of stakeholders. The hard work is paying off, according to CalGrowers.

“This is a big step in the multi year effort to regulate commercial cannabis in California,” explained to Terra Carver who serves as the Vice Chair for Policy on the CalGrowers Board of Directors. “Our team has been active throughout the process and will continue to stay engaged. The next step for us is to review the regulations in detail and make sure our members are familiar with all changes to the requirements.”

After an initial reading, a handful of important changes stand out:

•  A/M Consolidation: Though there is still some lack of clarity, the bottom line is that A and M licensees can now do business with each other indefinitely, and won’t have to pay duplicative licensing fees. In general, products can also be transferred between A and M at any point to meet demand.
• Expanded Appellation Protection: A product can only be labeled with the name of a county if all of the cannabis in the product is sourced from that county.
• Security Requirements Waived for Self-Distribution Transport-Only.
  
• Expands and strengthens water source protections.
  
• Transport of Immature Plants Allowed: Immature plants may be transported directly to a retailer by a transport-only distributor.

“The state agencies continue to lead the way on regulating cannabis in California,” said CalGrowers Executive Director Hezekiah Allen. “Though the state agencies are leaps and bounds ahead of most local governments, there is a real need to make the transition to regular rule-making as quickly as possible. The emergency rule-making process limits public participation and prevents the courts from weighing in. The implementation of cannabis regulations in California would benefit from both of these important components of statecraft.”

Since these are emergency rules, public comment is limited and must be sent within 5 days of the posting, which is expected on May 25, 2018. The readoption will allow the emergency regulations, as modified, to be in effect for an additional 180 days. During this time, the three licensing authorities will engage in the regular rulemaking process to develop final regulations.