Gov. Jerry Brown has made his wishes clear: He wants the conflicts between California’s medical and recreational cannabis laws resolved by the end of the year.
Tuesday night his office published a 92-page document offering up recommendations for how to settle key differences in laws regulating both segments of the industry, with the governor choosing sides on everything from how many licenses marijuana business owners can hold to how weed should be distributed statewide.
The proposals were included in a trailer bill to Brown’s 2017-18 budget. The legislature will vote on whether those proposals become law, before they ultimately head back to Brown for final approval.
“We were extremely happy when we saw what the governor’s office did,” said Nate Bradley, executive director of the California Cannabis Industry Association.
Since Brown largely sided with voter-approved recreational marijuana laws rather than legislator-crafted medical laws, Bradley said the governor “recognized the will of the voters” as he attempted to reconcile the two systems.
In an email about the trailer bill, Hezekiah Allen, who heads up the cannabis industry trade group the California Growers Association, applauded Brown’s proposals for limiting the number of larger farms and protecting the environment while expressing concern over the lack of clarity about delivery services and the governor’s recommendation to allow for vertical integration.
“There is a lot of work still to do to clarify and improve the proposal,” Allen said. “I expect many changes to come.”
The conflict started brewing back in 2015, when Brown signed into law a trio of bills known as the Medical Cannabis Regulation and Safety Act. The bills mandate comprehensive regulations on medical marijuana for the first time since Californians voted to legalize the plant as medicine in 1996, with requirements for all marijuana businesses to be licensed, all cannabis to be tested, pesticides to be regulated and more by Jan. 1, 2018.
Those bills also created the Bureau of Medical Cannabis Regulation and the state’s first so-called “pot czar” — a position now held by former alcohol industry regulator Lori Ajax — to oversee crafting specific regulations on the industry.
Then voters legalized marijuana for all adults on Nov. 8 under Proposition 64. The measure also gave the state until Jan. 1, 2018 to come up with detailed regulations for that side of the industry, making Ajax’s already challenging job even tougher.
Prop. 64 was shaped around the state’s new medical marijuana laws, so the two systems are largely similar. But there are some key distinctions. And those conflicts have been causing battles in Sacramento over the past five months between big unions and longtime marijuana farmers, small business owners and entrepreneurs with big plans for the industry.
Here are three key differences between the two laws and a look at how Brown proposes to resolve them.
- Distribution: Medical marijuana laws state that an independent distributor must take products from the grower or manufacturer to the retailer, much like how alcohol is handled. Prop. 64 would allow producers to drop off their products themselves, as they have for years. Brown recommends going with Prop. 64 on this one, saying that system will “make it easier for businesses to enter the market, encourage innovation, and strengthen compliance with state law.” The Teamsters, who were the most vocal opponents to that option, didn’t immediately respond Wednesday to a request for comment on Brown’s take.
- Farm sizes: Medical marijuana laws limit the number of medium-sized farms that would be allowed in the state. Prop. 64 does not. Brown proposes going with the medical marijuana policy here, saying it will help illegal production and shipping product out of state.
- Number of licenses: Medical marijuana laws state a person can only hold two different types of licenses in the cannabis industry, say for cultivation and retail. Prop. 64 doesn’t include those limits, allowing entrepreneurs to control many aspects of the production chain. Brown sides with Prop. 64 here, saying such restrictions can stifle business and noting that the recreational laws still include provisions to guard against monopolies.
Brown also recommends doing away with a requirement now in the law that says medical marijuana patients must get state ID cards. Instead, patients could continue to choose to get county-issued cards or purchase medical cannabis with only their doctor’s recommendation, as they have been able to since 1996.
As Brown’s budget proposal moves through the approval process, the Bureau of Medical Cannabis Regulation is also crafting detailed regulations over both sides of the industry.
“This provides us with direction for our regulations,” bureau spokesman Alex Traverso said.
A draft of medical marijuana rules are expected later this month, Traverso said, with recreational cannabis regulations due out this fall.