AUMA (Prop 64) Question and Answer

Marijuana & Business as Usual In California

Well not quite, because now we have to follow standard business practices which will be a pain for some. Instead of the feds breathing down our necks, we have AUMA (The Control, Regulate, and Tax Adult Use of Marijuana Act of California) on its way to passage. Our phones are ringing off the hook. Here are the hot FAQ’s we are currently answering.

Question: Who Is Regulating the California Cannabis Business Now?

AUMA established a Bureau of Marijuana Control in the Department of Consumer Affairs. Its job is to license and regulate the industry although it is still finding its feet. Note that this is not the same as the Bureau of Medical Marijuana Regulation. The Bureau of Marijuana Control should supersede it but this will not happen right away.

These bureaus are not the only regulators we may have to placate. Marijuana retailers, distributors, and micro businesses still have to deal with the Department of Consumer Affairs. The Department of Food and Agriculture will continue to license and oversee marijuana cultivation, with the Department of Public Health taking care manufacturing and testing. Finally, the State Board of Equalization will collect marijuana taxes. Well we did want government to treat us like a business.

Question: To What Time Line We are Working?

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Tuesday November 8th 2016 Was Quite a Day

Tuesday, November 8th 2016 was indeed quite a day. We got a new President, and we got the right to recreational cannabis in California (via Prop 64). What’s more, Massachusetts and Nevada followed suit, with Arkansas, Florida and North Dakota conceding medical marijuana.

When California joined the movement it became possible to share a joint along the entire U.S. west coast. This will put pressure on dissenting states, and ultimately on Washington whence a decision must ultimately come. Some folk who spent time in jail may be thinking of recourse.

Tuesday’s decision is only fitting for the Golden State, where the first medical marijuana approval passed two decades ago. Los Angeles Times reports that law enforcement does not necessarily see cause for merry making, and plans to monitor implementation of “substandard advertising restrictions and lack of prosecutorial tools for driving under the influence of marijuana closely”.

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Proposition 64 – Adult Use of Marijuana Act

The purpose of the Adult Use of Marijuana Act is to establish a comprehensive system to:

Legalize, control and regulate the cultivation, processing, manufacture, distribution, testing, and sale of nonmedical marijuana, including marijuana products, for use by adults 21 years and older, and to tax the commercial growth and retail sale of marijuana. It is the intent of the People in enacting this Act to accomplish the following:

(a) Take nonmedical marijuana production and sales out of the hands of the illegal market and bring them under a regulatory structure that prevents access by minors and protects public safety, public health, and the environment.

(b) Strictly control the cultivation, processing, manufacture, distribution, testing and sale of nonmedical marijuana through a system of state licensing, regulation, and enforcement.

(c) Allow local governments to enforce state laws and regulations for nonmedical marijuana businesses and enact additional local requirements for nonmedical marijuana businesses, but not require that they do so for a nonmedical marijuana business to be issued a state license and be legal under state law.

(d) Allow local governments to ban nonmedical marijuana businesses as set forth in this Act.

(e) Require track and trace management procedures to track nonmedical marijuana from cultivation to sale.

(f) Require nonmedical marijuana to be comprehensively tested by independent testing services for the presence of contaminants, including mold and pesticides, before it can be sold by licensed businesses.

(g) Require nonmedical marijuana sold by licensed businesses to be packaged in child-resistant containers and be labeled so that consumers are fully informed about potency and the effects of ingesting nonmedical marijuana.

(h) Require licensed nonmedical marijuana businesses to follow strict environmental and product safety standards as a condition of maintaining their license.

(i) Prohibit the sale of nonmedical marijuana by businesses that also sell alcohol or tobacco.

(j) Prohibit the marketing and advertising of nonmedical marijuana to persons younger than 21 years old or near schools or other places where children are present.

(k) Strengthen the state’s existing medical marijuana system by requiring patients to obtain by January 1, 2018, a new recommendation from their physician that meets the strict standards signed into law by the Governor in 2015, and by providing new privacy protections for patients who obtain medical marijuana identification cards as set forth in this Act.

(l) Permit adults 21 years and older to use, possess, purchase and grow nonmedical marijuana within defined limits for use by adults 21 years and older as set forth in this Act.

(m) Allow local governments to reasonably regulate the cultivation of nonmedical marijuana for personal use by adults 21 years and older through zoning and other local laws, and only to ban outdoor cultivation as set forth in this Act.

(n) Deny access to marijuana by persons younger than 21 years old who are not medical marijuana patients.

(o) Prohibit the consumption of marijuana in a public place unlicensed for such use, including near K-12 schools and other areas where children are present.

(p) Maintain existing laws making it unlawful to operate a car or other vehicle used for transportation while impaired by marijuana.

(q) Prohibit the cultivation of marijuana on public lands or while trespassing on private lands.

(r) Allow public and private employers to enact and enforce workplace policies pertaining to marijuana.

(s) Tax the growth and sale of marijuana in a way that drives out the illicit market for marijuana and discourages use by minors, and abuse by adults.

(t) Generate hundreds of millions of dollars in new state revenue annually for restoring and repairing the environment, youth treatment and prevention, community investment, and law enforcement.

(u) Prevent illegal production or distribution of marijuana.

(v) Prevent the illegal diversion of marijuana from California to other states or countries or to the illegal market.

(w) Preserve scarce law enforcement resources to prevent and prosecute violent crime.

(x) Reduce barriers to entry into the legal, regulated market.

(y) Require minors who commit marijuana-related offenses to complete drug prevention education or counseling and community service.

(z) Authorize courts to resentence persons who are currently serving a sentence for offenses for which the penalty is reduced by the Act, so long as the person does not pose a risk to public safety, and to redesignate or dismiss such offenses from the criminal records of persons who have completed their sentences as set forth in this Act.

Read the full Adult Use of Marijuana Act text

How California Might Implement Proposition 64

The Proposition 64 Ballot is on November 8, 2016. Stripped of the hyperbole, voters have a choice of saying ‘Yes’ or ‘No’ to the following proposal.

– Legalize marijuana under state law for use by adults 21 or older

– Impose state taxes on sales and cultivation

– Provide for industry licensing and standards for marijuana products

– Allow local regulation and taxation

– Receive additional tax revenues, mostly for specific purposes

– Reduce costs of criminal justice

That’s a broad palette to give to politicians. MMJ Info decided to dust off the crystal ball and figure out what they will do if, and we think likely voters approve.

Benefits for Consumers from Legalized Marijuana

Adults will be free to grow, purchase, transport, and possess a small but significant amount of marijuana for personal use without requiring a medical script. There are however still some limitations.

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California’s MMJ Extractors May Rest Easier Now

California’s medical marijuana extractors can rest a little easier, now that Gov. Jerry Brown signed Assembly Bill AB 2679 into law on September 29. This “exempts collectives and cooperatives that manufacture medical cannabis products from criminal sanctions for manufacturing medical cannabis” until January 2018 when formal regulations take effect.

During this bridging period, extractors must follow stated manufacturing requirements and possess valid local permissions. Assembly Bill AB 2679 describes the two permitted extraction methods as follows (the underlining is ours):

Permitted Medical Marijuana Extraction Methods

“(A) Utilizes only manufacturing processes that are either solvent-less or that employ only nonflammable, nontoxic solvents that are generally recognized as safe pursuant to the federal Food, Drug, and Cosmetic Act (21 U.S.C. Sec. 301 et seq.).

(B) Utilizes only manufacturing processes that use solvents exclusively within a closed-loop system that meets all of the following requirements:

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Is Big Business Taking Marijuana on a Downer in Colorado?

Supply and demand generally control prices in an open economy. Closet Colorado cannabis farmers got good prices during prohibition, because herb was relatively hard to get. There was also an element of thrill dodging the neighbors. Now your favorite medicine or smoke is becoming legal, the trend is boring.

Some California cultivators hope to hold prices high with talk of noble cultivars like Mendocino Covelo/Dos Rios OG Kush, and South Mendocino County Sour Diesel. This may work if you like your German auto with a star on the bonnet. In Colorado, this may not even break the ice. The truth is marijuana prices are plunging in the Centennial State.

Wholesale prices crashed from a median of $2500 per pound in October 2015, to $1500 in August 2016 according to The Motley Fool. This is not a result of healthy competition. For as long as Colorado holds back on new cannabis licenses – and fails to put a cap on the number of plants per grower – the monopolistic few will flood the market, drive prices down, and effectively snuff out the hopes of potential new entrants.

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