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Gov. Brown signs bills regulating medical marijuana industry

| Oct 12, 2015 | News

by Victoria Colliver and Rachel Swan

h/t SF Chronicle

Co-founder and executive director Ryan Hudson (far right) talks with customer Beau Freshour (brown sweater) at The Apothecarium, a medical marijuana dispensary in San Francisco, Calif., on Thursday, October 1, 2015. Governor Jerry Brown is expected to sign bills to regulate the medicinal weed industry today

Nearly 20 years after voters made California the first state in the nation to legalize the medical use of marijuana, Gov. Jerry Brown on Friday signed a package of bills to regulate the multibillion-dollar medicinal-cannabis industry.

The stringent and comprehensive regulations create an enforceable framework for governing virtually every aspect of the business in California — from licensing and taxation to quality control, shipping, packaging and pesticide standards.

The lack of regulations for the booming medical pot business has been frustrating to growers, dispensary operators, local governments, law enforcement and patient groups since 1996 when California voters approved Proposition 215, the law that made it legal for doctors to recommend pot to their patients.

In the void, what has emerged is a hazy, semi-legitimate industry that operates in conflict with federal law and in the gray areas and varies between jurisdictions. The regulations seek to change that.

“This new structure will make sure patients have access to medical marijuana, while ensuring a robust tracking system,” the governor said in his signing message. “This sends a clear and certain signal to our federal counterparts that California is implementing robust controls not only on paper, but in practice.”

While some aspects of the legislation have been criticized, most involved in the industry say the benefits of having regulations more than outweigh any of the downsides.

“This is going to allow the industry to come out of the shadows and into the light,” said Nate Bradley, executive director of the California Cannabis Industry Association, a trade group that pushed for amendments on the bills.

The package of laws signed by Brown consists of three bills — Assembly Bill 266, Assembly Bill 243 and Senate Bill 643 — which together create the structure to license, tax and regulate the industry as well as the funding mechanisms for the agencies that oversee the operations. The law is slated to go into effect in 2018, although some provisions may be phased in earlier.

Known as the Medical Marijuana Regulation and Safety Act, the bills were passed by the state Legislature in September in a down-to-the-wire push before the end of the regular session. Lawmakers considered the action crucial, considering that one or more ballot measures to legalize the recreational use of marijuana will likely be on the 2016 ballot.

AB 266 establishes a new agency, the Bureau of Medical Marijuana Regulation, to oversee the licensing rules for medical pot growers, the makers of the products and retailers. The agency will be assisted by the California Department of Food and Agriculture, the Department of Public Health and other state agencies.

SB 643, authored by Sen. Mike McGuire, D-Healdsburg, clamps down on clinics that capitalized on the lack of regulation by issuing medical marijuana prescriptions to patients who lacked valid health needs. It also creates licensing and other regulations to oversee the industry.
Assembly Bill 243, authored by Assemblyman Jim Wood, D-Healdsburg, establishes guidelines and regulations for medical pot cultivators, but takes an environmental approach. It gives the nine regional water quality boards in the state the authority to regulate the discharge of water, chemicals and sediment into the environment.

Under the new law, cities and counties will retain the right to ban medicinal pot businesses within their jurisdictions, and allows individuals with a doctor’s recommendation to grow marijuana for their own consumption.

Assemblyman Rob Bonta, D-Oakland, one of four co-authors of AB 266, said the governor’s approval of the Medical Marijuana Regulation and Safety Act ushers in a new era in California by providing protections for patients, law enforcement and the environment.
“The medical marijuana industry itself will be able to come out of the shadows and receive the same protections under the law as other state-licensed businesses, creating jobs and contributing to the economy,” Bonta said in a statement.

Another co-author, Assemblyman Tom Lackey, R-Palmdale (Los Angeles County), lauded a provision of AB 266 that commissions an academic study under the new Bureau of Medical Marijuana Regulation to determine exactly how marijuana use impairs motor skills to assist in enforcing drugged driving laws.

“As a 28-year veteran of the California Highway Patrol, I personally observed an increase in stoned driving with the passage of Proposition 215 — no question about it,” Lackey said in a statement before the bill’s signing.

Business owners and others involved in the medical pot industry welcomed the new regulations. But they expressed some reservations, namely that the additional costs that come from complying with the regulations could push out some growers, raise prices and even send consumers into the black market.

But Steve DeAngelo, co-founder and executive director of Oakland’s Harborside Health Center, who said the overall the benefits of having statewide regulations outweigh his qualms with this set of bills.
The state, up until now, has had a patchwork system of regulations, and no regulations at all in some areas, he said. That’s opened the door for shady operators.

“They might be handing out leaflets at high schools,” he said of the problems created by some operators. “In extreme cases, they’re selling other drugs and shipping things out of state.”

Ryan Hudson, co-founder of The Apothecarium, a medical cannabis dispensary in the Castro, praised the new rules for holding all marijuana businesses to the same standards for laboratory testing, labeling and product-tracking.

Though both Hudson and DeAngelo take issue with some aspects of the new regulations, they expressed hope that the Legislature will revise them next session.

“The first time you do something, you rarely get it right,” DeAngelo said.

Victoria Colliver and Rachel Swan are San Francisco Chronicle staff writers. E-mail: [email protected] and [email protected]. Twitter: @vcolliver and @rachelswan