July 27, 2020

Meital Manzuri Comments on Cannabis Policy

With multiple legislators contracting COVID-19, the Legislature recently confirmed that some voting will be done remotely in the next month. The new rule was crafted to make sure some legislation is passed before the constitutional deadline of August 31 for the 2019-20 two-year legislative session. If bills are not passed by both houses by that date, they die and will need to be introduced again in the 2021 legislative session. As of the time of writing this article, the Assembly is allowing four legislative leaders to cast proxy votes for absent lawmakers during floor sessions. The Senate will allow legislators to vote remotely during committee hearings but will require them to vote in person for floor sessions.

The Legislature has a lot of work to accomplish in a short timeframe. The pandemic delayed committee hearings for weeks, and despite requests by leadership to limit their legislative packages, assemblymembers and senators still pushed for hundreds of bills to stay alive. For certain committees there may be only time for one hearing, meaning some bills may die simply because there was no time to hear them. Below are some of the cannabis-related ones that have made it through thus far and hope to get through to the governor’s desk:

  • SB 67 (McGuire): appellations of origins. State law requires the Department of Food and Agriculture to develop a framework for to establish appellations of origin by January 1, 2021. In February, the department released proposed regulations for the program. SB 67 would clarify that appellations of origin could only be established for cannabis planted in the ground, in open air, with no artificial light during the flowering stage of cultivation until harvest. It is currently scheduled to be heard in Assembly Business and Professions committee on August 10.
  • AB 1525 (Jones-Sawyer): financial institutions. Legislators continue to search for unique solutions to banking challenges that afflict the cannabis industry. AB 1525 seeks to protect credit unions, banks, and other financial institutions from penalties for working with cannabis companies. Recent amendments also authorize state and local authorities to share certain licensee and application information to a licensee or applicant’s financial institution of choice. AB 1525 is currently scheduled to be heard on August 11 in the Senate Banking and Financial Institutions committee.
  • AB 2122 (Rubio): enforcement for unlawful activity. California currently penalizes persons engaging in unlicensed commercial cannabis activity up to three times the amount of the license fee for that activity. However, some legislators contend that up to as much as 80% of the state’s cannabis is generated by the illicit market. AB 2122 would levy for civil penalties of up to $30,000 for aiding and abetting unlicensed commercial cannabis activity. It also authorizes the state to destroy any cannabis associated with the violation. The bill is in the Senate Judiciary Committee which is expected to hear bills on July 30 and August 12.

As always, these bills are subject to change, and change seems likely as legislators continue to grapple with remote work and strict deadlines in the middle of the pandemic. By the time this article is published, the Legislature’s rules and the status of these bills may have changed. The best way to stay informed about bills you are interested in is to maintain contact with the bill author or follow the bill’s progress on www.leginfo.legislature.ca.gov. Stay safe!

Disclaimer: This article has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice.