Model Bill to Equitably Legalize and Regulate Cannabis

Section 1. Purpose and findings.

(a) Cannabis legalization fosters safety by allowing regulations to protect cannabis consumers, workers, communities, and the environment.

(b) The prohibition of cannabis diverts law enforcement resources from violent and property crimes, subjects civilians to unnecessary police interactions, and is at odds with our commitment to liberty.

(c) Keeping cannabis illegal deprives the state of thousands of legal jobs and hundreds of millions of dollars in tax revenue.

(d) The prohibition of cannabis has had an unfair, disparate impact on persons and communities of color. A 2020 report by the ACLU found Black individuals are 3.6 times as likely as white individuals to be arrested for cannabis possession, despite nearly identical use rates.

(e) The State of [State] finds and declares that the use of cannabis should be legal for persons 21 years of age or older and subject to taxation and regulation in a manner that:

(1) controls the production and distribution of cannabis under a system of licensing, regulation, and taxation;

(2) includes lab testing, potency labeling, secure packaging, restrictions on advertising, and education about responsible use and risks;

(3) promotes the participation of individuals most impacted by cannabis prohibition in the legal, regulated industry; and

(4) generates needed revenue, including to reinvest in communities, for substance abuse treatment and education, and to train more law enforcement officers to detect impaired driving.

(f) The State of [State] further finds and declares that it is necessary to ensure consistency and fairness in the application of this chapter throughout the state and that, therefore, the matters addressed by this chapter are, except as specified herein, matters of statewide concern.

Section 2. Definitions.

As used in this chapter unless the context otherwise requires:

(a) “Consumer” means a person 21 years of age or older who purchases cannabis or cannabis products for personal use by persons 21 years of age or older, but not for resale.

(b) “Department” means [the appropriate department, which in most cases will be the one regulating alcohol sales] or its successor agency.

(d) “Locality” means a municipality or, in reference to a location outside the boundaries of a municipality, a county.

(e) “Cannabis” means all parts of the plant of the genus cannabis, the resin extracted from any part of the plant, and every compound, manufacture, salt, derivative, mixture, or preparation of the plant, or its resin, including cannabis concentrate. “Cannabis” does not include hemp.

(f) “Cannabis accessories” means any equipment, products, or materials of any kind that are used, intended for use, or designed for use in planting, propagating, cultivating, growing, harvesting, composting, manufacturing, compounding, converting, producing, processing, preparing, testing, analyzing, packaging, repackaging, storing, vaporizing, or containing cannabis, or for ingesting, inhaling, or otherwise introducing cannabis into the human body. “Cannabis accessories" and "cannabis paraphernalia" do not include products that are not designed or marketed for use related to cannabis.

(g) “Cannabis concentrate” means the resin extracted from a cannabis plant and every preparation that is composed primarily of such resin, including, but not limited to, hashish and cannabis oils for vaporization. Cannabis concentrate shall not include cannabis products made from cannabis concentrate where the majority of the content by weight is something other than cannabis such as, but not limited to, edible products, topical products, and tinctures.

(h) “Cannabis cultivation facility” means an entity registered to cultivate, prepare, and package cannabis and sell cannabis to other cannabis establishments but not to consumers. A cannabis cultivation facility may not produce cannabis concentrates, tinctures, extracts, or other cannabis products unless it is also licensed as a cannabis product manufacturing facility.

(i) “Cannabis delivery service” or “delivery service” means an entity registered to deliver cannabis to consumers.

(j) “Cannabis establishment” means a cannabis cultivation facility, a cannabis delivery service, an on-site consumption establishment, a cannabis testing facility, a cannabis product manufacturing facility, a cannabis transporter, a retail cannabis store, or any other type of cannabis business authorized and registered by the department.

(k) “Cannabis product manufacturing facility” means an entity registered to purchase cannabis; manufacture, prepare, and package cannabis products; and sell cannabis and cannabis products to other cannabis establishments but not to consumers.

(l) “Cannabis products” means products that are comprised of cannabis, cannabis concentrate, or cannabis extract, and other ingredients and are intended for use or consumption, such as, but not limited to, edible products, ointments, and tinctures.

(m) “Cannabis testing facility” means an entity registered to test cannabis for potency and contaminants.

(n) “Cannabis transporter” means an entity registered to transport cannabis between cannabis establishments.

(o) “Canopy” or “canopy space” means the surface area utilized to produce mature plants calculated in square feet and measured using the outside boundaries of any area that includes mature marijuana plants, including all the space within the boundaries. The square footage of canopy space is measured horizontally starting from the outermost point of the furthest mature flowering plant in a designated growing space and continuing around the outside of all mature flowering plants located within the designated growing space. If growing spaces are stacked vertically, each level of space shall be measured and included as part of the total canopy space measurement.

(p) “On-site consumption establishment” means an entity registered to sell cannabis or cannabis products for on-site consumption.

(q) “Possession limit” means:

(1) Two-and-a-half ounces of cannabis in a form other than concentrated cannabis or cannabis products;

(2) Fifteen grams of concentrated cannabis, which includes hashish and cannabis extracts intended for vaporization;

(3) Cannabis products other than concentrated cannabis containing no more than 2,500 milligrams of THC;

(4) Six cannabis plants; and

(5) Any additional cannabis produced by the person’s cannabis plants provided that the possession of any amount of cannabis in excess of 2.5 ounces of cannabis, 15 grams of concentrated cannabis, and cannabis products containing no more than 2,500 milligrams of THC must be limited to the same property where the plants were cultivated.

(r) “Public place” means any place to which the general public has access. It does not include an on-site consumption establishment or a privately-owned, outdoor location where cannabis is used with the permission of the property owner.

(s) “Retail cannabis store” means an entity registered to purchase cannabis from cannabis establishments and sell cannabis and cannabis products to consumers.

(t) “Volatile extraction” means:

(1) Extractions using any solvent identified as volatile or hazardous by the department; and

(2) Any method of extraction identified as potentially hazardous by the department.

Section 3. Personal use of cannabis.

Notwithstanding any other provision of law, except as otherwise provided in this chapter, the following acts are not unlawful and shall not be a criminal or civil offense under [State] law or the law of any political subdivision of [State] or be a basis for seizure or forfeiture of assets under [State] law for persons 21 years of age or older:

(1) Possessing, consuming, ingesting, smoking, growing, using, processing, purchasing, or transporting an amount of cannabis that does not exceed the possession limit, except that no adult other than one who is acting in his or her capacity as a staffer of a cannabis product manufacturer may perform volatile extractions.

(2) Transferring an amount of cannabis that does not exceed the possession limit to a person who is 21 years of age or older without remuneration;

(3) Controlling property where actions described by this section occur; and

(4) Assisting another person who is 21 years of age or older in any of the acts described in this section.

Section 4. Restrictions on personal cultivation, penalty.

(a) Cannabis plants may not be cultivated in a location where the plants are subject to public view, including view from another private property, without the use of binoculars, aircraft, or other optical aids.

(b) Cannabis plants cultivated shall be kept in a secured place not easily accessible to any person under the age of 21.

(c) A person who violates this section is guilty of a civil violation punishable by a fine of up to $750. A person found responsible for a violation under this section may request, and shall be granted, a penalty of up to 75 hours of community service in lieu of a fine.

Section 5. Public smoking or vaporization prohibited, penalty.

(a) It is unlawful to smoke or vaporize cannabis in a public place.

(b) A person who violates this section is guilty of a civil violation punishable by a fine of up to $50. A person found responsible for a violation under this section may request, and shall be granted, a penalty of up to five hours of community service in lieu of a fine.

Section 6. False identification, penalty.

(a) A person who is under 21 years of age may not present or offer to a cannabis establishment or the cannabis establishment’s agent or employee any written or oral evidence of age that is false, fraudulent, or not actually the minor’s own for the purpose of:

(1) Purchasing, attempting to purchase, or otherwise procuring or attempting to procure cannabis; or

(2) Gaining access to a cannabis establishment.

(b) A person who violates this section is guilty of a civil violation punishable by a fine of up to $150. A person found responsible for a violation under this section may request, and shall be granted, a penalty of up to 15 hours of community service in lieu of a fine.

Section 7. Odor and personal possession of cannabis not grounds for a search.

(a) Except as provided in this section, the odor of cannabis or burnt cannabis, or the possession of a quantity of cannabis that the officer does not have probable cause to believe exceeds the possession limit, shall not constitute in part or in whole probable cause or reasonable suspicion and shall not be used as a basis to support any stop or search of a person or motor vehicle.

(b) Nothing in this section prevents a law enforcement official from evaluating a driver for impairment based in part on the odor of recently burnt cannabis if the law enforcement official would otherwise be permitted to do so under law.

Section 8. Removing penalties and disqualifications for the lawful use of cannabis.

(a) A person shall not be subject to arrest, prosecution, or penalty in any manner, or be denied any right or privilege, including but not limited to disciplinary action by a business, occupational, or professional licensing board or bureau, solely for conduct permitted under this chapter.

(b) It is unlawful for an employer to discriminate against a person in hiring, termination, or any term or condition of employment, or otherwise penalizing a person, if the discrimination is based upon any of the following:

(1) The person’s use of cannabis off the job and away from the workplace.

(2) An employer-required drug screening test that has found the person to have non-psychoactive cannabis metabolites in their hair, blood, urine, or other bodily fluids.

(3) An arrest or conviction for a non-violent cannabis offense prior to the effective date of this act that does not involve distribution to a minor.

(d) This section does not preempt federal laws requiring applicants or employees to be tested for controlled substances, including laws and regulations requiring applicants or employees to be tested, or the manner in which they are tested, as a condition of employment, receiving federal funding or federal licensing-related benefits, or entering into a federal contract.

(e) No institution of higher education may revoke any financial aid or student loans, or expel a student solely for use of cannabis, or possession of less than the possession limit unless complying with the provisions of this section would violate federal law or a federal contract, or failing to take the actions prohibited under this section would jeopardize an institution of higher education's federal funding.

(f) (1) Except as provided in this section, neither the state nor any of its political subdivisions may impose any penalty or deny any benefit or entitlement for conduct permitted under this chapter or for the presence of cannabinoids or cannabinoid metabolites in the urine, blood, saliva, breath, hair, or other tissue or fluid of a person who is 21 years of age or older.

(2) Except as provided in this section, neither the state nor any of its political subdivisions may deny a driver’s license, a professional license, housing assistance, social services, or other benefits based on cannabis use or for the presence of cannabinoids or cannabinoid metabolites in the urine, blood, saliva, breath, hair, or other tissue or fluid of a person who is 21 years of age or older.

(g) No person shall be denied custody, visitation, or parenting time with a minor for conduct allowed under this chapter and no presumption of neglect or child endangerment shall arise therefrom; provided that this subsection shall not apply if the person's conduct creates a danger to the safety of the minor as established by a preponderance of the evidence.

(h) For the purposes of medical care, including organ and tissue transplants, the use of cannabis does not constitute the use of an illicit substance or otherwise disqualify a person from needed medical care and may only be considered with respect to evidence-based clinical criteria.

(i) Notwithstanding any other provision of law, unless there is a specific finding that the individual’s use, cultivation, or possession of cannabis could create a danger to the individual or another person, it shall not be a condition of release from parole, probation, or pre-trial detention to:

(1) abstain from conduct allowed by this chapter; or

(2) test negative for cannabis, tetrahydrocannabinol, or any other cannabinoid or metabolite of cannabis.

(j) No state or local agency, and no employee or agent of any state or local agency, may:

(1) restrict, revoke, suspend, or otherwise infringe upon a person’s right to own, purchase, or possess a firearm, ammunition, or any related firearms certification based solely on the person's possession, use, or purchase of cannabis, or for other actions allowed by this chapter; or

(2) directly or indirectly inform a federal agency or federal official that a person owns, possesses, purchases, or may attempt to own, possess, or purchase a firearm or ammunition while possessing cannabis or being a cannabis consumer.

Section 9. Driving under the influence and reckless endangerment prohibited.

This chapter does not authorize any person to engage in, and does not prevent the imposition of any penalties for engaging in, the following conduct:

(a) Undertaking any task under the influence of cannabis, when doing so would constitute negligence or professional malpractice.

(b) Operating, navigating, or being in actual physical control of any motor vehicle, aircraft, train, or motorboat while under the influence of cannabis.

Section 10. Cannabis accessories authorized.

(a) Except as provided in this section, notwithstanding any other provision of law, it is not unlawful and shall not be an offense under [State] law or the law of any political subdivision of [State] or be a basis for seizure or forfeiture of assets under [State] law for persons 21 years of age or older to manufacture, possess, possess with intent to distribute, or purchase cannabis accessories, or to distribute or sell cannabis accessories to a person who is 21 years of age or older.

(b) Except as provided in this section, a person who is 21 years of age or older is authorized to manufacture, possess, and purchase cannabis accessories, and to distribute or sell cannabis accessories to a person who is 21 years of age or older. This section is intended to meet the requirements of subsection (f) of Section 863 of Title 21 of the United States Code (21 U.S.C. Sec. 863(f)) by authorizing, under state law, any person in compliance with this chapter to manufacture, possess, or distribute cannabis accessories.

(c) No person may manufacture, distribute, or sell cannabis accessories that violate reasonable regulations enacted by the department. A first-offense violation is a civil fine of up to $1,000 and forfeiture of the cannabis accessories. A second or subsequent offense is a misdemeanor punishable by a fine of up to $5,000, up to 180 days in jail, or both, and forfeiture of the cannabis accessories.

Section 11. Lawful operation of cannabis-related facilities.

(a) Notwithstanding any other provision of law, the following acts, when performed by a cannabis establishment with a current, valid license, or a person 21 years of age or older who is acting in his or her capacity as an owner, employee, or agent of a cannabis establishment, are not unlawful and shall not be an offense under [State] law or be a basis for seizure or forfeiture of assets under [State] law:

Engaging in any activities involving cannabis, cannabis accessories, or cannabis products if the person conducting the activities has obtained a current, valid license to operate a cannabis establishment or is acting in his or her capacity as an owner, employee, or agent of a registered cannabis establishment, and the activities are within the scope of activities allowed by the department for that type of cannabis establishment.

(b) Nothing in this section prevents the imposition of penalties for violating this chapter or rules adopted by the department or localities pursuant to this chapter.

Section 12. Verifying the age of cannabis consumers, penalty.

(a) A cannabis establishment or an agent or staffer of a cannabis establishment may not sell, deliver, distribute, give, transfer, or otherwise furnish cannabis to a person under the age of 21, unless the person is a medical cannabis patient pursuant to [section of law] who is at least 18 years of age.

(b) A violation of this section is a misdemeanor punishable by a fine of up to $5,000, up to 90 days in jail, or both.

(c) A person convicted of violating this section may not be employed as a cannabis establishment or an agent or staffer for five years after the date of conviction.

(d) The establishment of all of the following facts by a cannabis establishment or an agent or employee of a cannabis establishment making a sale of cannabis to a person under the age of 21 shall constitute an affirmative defense to any prosecution for such sale:

(1) That the person presented what an ordinary and prudent person would believe to be a valid photo identification.

(2) That the sale was made in good faith relying upon such documentation and appearance in the reasonable belief that the person was 21 years of age or older.

(e) For the purposes of this section “valid photo identification” means, any of the following documentation that such person is 21 years of age or over:

(1) A motor vehicle driver's license issued by [State], or a valid driver's license issued by another state, the District of Columbia, or a United States territory;

(2) An identification card issued by [State], or any picture identification card

issued by another state, the District of Columbia, or a United States territory, which bears the date of birth, name, and address of the individual;

(3) An armed services identification card; or

(4) A valid passport from the United States or a country with whom the United States maintains diplomatic relations.

Section 13. Occupational licensing.

(a) A holder of a professional or occupational license may not be subject to professional discipline for providing advice or services related to cannabis establishments or applications to operate cannabis establishments on the basis that cannabis is illegal under federal law.

(b) An applicant for a professional or occupational license may not be denied a license based on previous employment related to cannabis establishments operating in accordance with state law.

Section 14. Office of Social Equity.

(a) There shall be established an Office of Social Equity within the department. The governor shall appoint an executive director who must have at least five years of experience in civil rights advocacy, civil rights litigation, or social justice.

(b) The Office of Social Equity shall promote and encourage full participation in the regulated cannabis industry by people from communities that have previously been disproportionately harmed by cannabis prohibition and enforcement in order to positively impact those communities. Its duties shall include:

(1) defining “social equity applicant,” and considering whether the definition should include any or all of the following:

(i) individuals with past convictions for a cannabis offense,

(ii) individuals whose parent had a prior conviction for a cannabis offense,

(iii) individuals who have had a less than honorable discharge from the military due to cannabis, and

(iv) individuals who are long-term residents of or who grew up in census tracts or other geographic areas disproportionately impacted by cannabis enforcement, poverty, unemployment, cannabis prohibition, mass incarceration, and/or racial discrimination.

(2) administering the Community Reinvestment and Repair Fund to improve the wellbeing of individuals and communities that have experienced a disproportionate negative impact from poverty, unemployment, cannabis prohibition and enforcement, mass incarceration, and/or racial discrimination;

(3) administering the Social Equity Fund to issue zero-interest loans and grants to social equity applicants and cannabis establishments owned and operated by social equity applicants;

(4) administering the Cannabis Education and Technical Assistance Fund to provide free or low-cost training, education, and technical assistance for individuals working in the cannabis industry or owning a cannabis establishment, with a focus on individuals who would qualify as social equity applicants;

(5) advising the department regarding regulations, including advising against implementing regulations and financial requirements that unnecessarily impose financial burdens that undermine the purposes of this section and providing recommendations on regulations related to diversity, and social equity applications;

(6) producing reports and recommendations on diversity and equity in the legal cannabis economy, including in ownership, management, and employment; and

(7) investigating whether businesses are adhering to their obligations and recommending corrective action or discipline if they fail to do so, which may include a suspension or revocation of licenses.

(c) (1) Before determining how funds from the Community Reinvestment and Repair Fund will be allocated, the Office of Social Equity shall promote and hold public meetings in at least 10 of the census tract areas that have been significantly impacted by poverty, unemployment, cannabis prohibition, mass incarceration, and/or systemic racism to seek input on the communities’ needs and priorities for the Community Reinvestment and Repair Fund.

(2) The Office of Social Equity shall distribute funds from the Community Reinvestment and Repair Fund in a manner that improves the wellbeing of communities and individuals that have been significantly impacted by poverty, unemployment, cannabis prohibition, mass incarceration, and/or racial discrimination. Permissible uses of the fund include but are not limited to grants to nonprofit organizations or allocations to government agencies for:

(i) housing assistance;

(ii) re-entry services, including job training and placement;

(iii) scholarship assistance for low-income students;

(iv) community-based organizations to provide services to prevent violence, support youth development, provide early intervention for youth and families, and promote community stability and safety; and

(v) legal or civic aid.

(d) No later than August 1 of each year, the Office of Social Equity must produce and make publicly available a report on how the Community Reinvestment and Repair Fund, Social Equity Fund, and Cannabis Education and Technical Assistance Fund were allocated during the prior year.

(e) No later than November 1 of each year, the Office of Social Equity shall solicit public input on the uses of the Community Reinvestment and Repair Fund, Social Equity Fund, and Cannabis Education and Technical Assistance Fund. The Office of Social Equity shall publish a review of feedback received no later than December 15 of each year.

Section 15. Rulemaking.

(a) No later than 180 days after the effective date of this act, the department shall adopt regulations necessary for implementation of this chapter. Such regulations shall not prohibit the operation of cannabis establishments, either expressly or through regulations, nor require such a high investment of risk, money, time, or any other resource or asset that the operation of a cannabis establishment is not worthy of being carried out in practice by a reasonably prudent businessperson. Such regulations shall include:

(1) Procedures for the issuance, renewal, suspension, and revocation of a license to operate a cannabis establishment, with such procedures subject to all requirements of the [state administrative procedure act];

(2) Rules, procedures, and policies to promote and encourage full participation in the regulated cannabis industry by people from communities that have previously been disproportionately harmed by cannabis prohibition and enforcement and to positively impact those communities, which shall reflect input from the Office of Social Equity.

(3) A schedule of reasonable application, license, and renewal fees, provided that, unless the department determines a greater fee is necessary to carry out its responsibilities under this chapter:

(i) application fees shall not exceed $2,500, with this upper limit adjusted annually for inflation;

(ii) licensing fees shall not exceed $10,000, with this upper limit adjusted annually for inflation;

(iii) cultivation facility application, licensing, and renewal fees must be tiered based on the size of the establishments; all other application, licensing, and renewal fees may be tiered based on the size or sales volume of the establishments.

(4) Qualifications for licensure that are directly and demonstrably related to the operation of a cannabis establishment and that may not disqualify applicants solely for cannabis offenses prior to the effective date of this act;

(5) Security requirements, including but not limited to requiring the Department to implement a single statewide inventory monitoring system that:

(i) tracks all cannabis from immature plant until the cannabis is sold to a consumer;

(ii) includes tracking laboratory testing results;

(iii) is capable of facilitating a complete product recall; and

(iv) shall not require or allow cannabis establishments to identify consumers who cannabis is distributed to.

(6) Requirements for the transportation and storage of cannabis and cannabis products by cannabis establishments.

(7) Requirements for the delivery of cannabis and cannabis products to consumers, including a prohibition on business names, logos, and other identifying language or images on delivery vehicles. These requirements must allow cannabis delivery services to purchase directly from cannabis cultivation facilities and cannabis product manufacturing facilities and to operate a warehouse;

(8) Employment requirements, including requiring that each cannabis establishment agent be issued an identification badge by either the department or their employer. These requirements may not disqualify applicants solely for cannabis offenses prior to the effective date of this act;

(9) Training and continuing education required or recommended for agents, which shall include training on checking photo identification and for false identification for agents who sell cannabis to consumers;

(10) Requirements designed to prevent the sale or diversion of cannabis and cannabis products to persons under the age of 21;

(11) Requirements for cannabis and cannabis products sold or distributed by a cannabis establishment, including prohibiting any misleading labeling. The rules must require product labels to include the following:

(i) The length of time it typically takes for the product to take effect;

(ii) A disclosure of ingredients and possible allergens, if the cannabis product is a food-based product; and

(iii) A nutritional fact pane, if the cannabis product is a food-based product.

(12) Requirements that cannabis packaging include:

(i) Prohibitions on products and packaging that are designed to make the product more appealing to children, including prohibiting the use of any images designed or likely to appeal to minors, including cartoons, toys, animals, or children, and any other likeness to images, characters, or phrases that are popularly used to advertise to children;

(ii) mandating inclusion of a universal cannabinoid product symbol that has been approved as a consensus standard issued by a nationally recognized consensus standard organization; and

(iii) requirements for opaque, child-resistant packaging for edible cannabis products, which must be designed or constructed to be significantly difficult for children under five years of age to open and not difficult for adults to use properly as defined by 16 C.F.R. 1700.20 (1995).

(13) Regulations for cannabis cultivation facilities, including:

(i) security standards for both the indoor and outdoor cultivation of cannabis;

(ii) allowing cultivation facilities to move up to a higher tier at least once per year if they meet the security requirements and pay the associated fee, except that the commission may suspend this provision in the event of an oversupply; and

(iii) restrictions on the use of pesticides that are injurious to human health.

(14) Regulations on advertising, marketing, and signage including but not limited to:

(i) a prohibition on mass-market campaigns that have a high likelihood of reaching minors; and

(ii) a prohibition on cannabis products that are named, packaged, marketed, or designed in a way that mimics or is likely to cause confusion with commercially available, trademarked non-cannabis products, including relating to their logos, the sound of the product or brand, packaging, taste, appearance, and commercial impression.

(15) Regulations to create at least six tiers of cannabis cultivation facilities, based on the size of the facility or the number of plants cultivated, and whether the cultivation occurs outdoors, indoors, or in a greenhouse.

(i) If a vertically-tiered or shelving system is included in the canopy area, the surface area of each tier or shelf must be included in calculating the canopy area.

(ii) Security regulations and licensing fees must vary based on the size of the cultivation facility.

(iii) The smallest tier, tier 1, is limited to 2,500 square feet of canopy for indoor or greenhouse cultivation and 7,500 square feet of canopy for outdoor cultivation.

(16) Health and safety regulations, including:

(i) Standards for the extraction of cannabis and manufacture of cannabis products, including requiring an endorsement for volatile extractions;

(ii) Restrictions or prohibitions on additives to cannabis and cannabis-infused products, including but not limited to those that are toxic or designed to make the product more addictive;

(iii) A definition of the amount of tetrahydrocannabinol that constitutes a single serving in an edible cannabis product;

(iv) Standards for the safe manufacture of cannabis extracts and concentrates;

(v) Requirements for random sample testing to ensure quality control, including by ensuring that cannabis and cannabis-infused products are accurately labeled for potency. Unless the department determines that remediation or treatment are sufficient to ensure product safety, the testing analysis must include testing for residual solvents, poisons, or toxins; harmful chemicals; dangerous molds or mildew; filth; and harmful microbials such as E. coli or salmonella and pesticides;

(vi) Standards for the operation of cannabis testing facilities, including requirements for equipment and qualifications for personnel;

(vii) Regulations governing intoxicating products derived from hemp, including for labeling, lab testing, and age-verification; and

(viii) Procedures and notices relating to all recalls of any products.

(17) Regulations governing visits to cannabis cultivation facilities and cannabis product manufacturing facilities, including requiring the cannabis establishment to log visitors;

(18) Civil and administrative penalties for the failure to comply with regulations made pursuant to this chapter, and procedures for hearings;

(19) Procedures for collecting taxes levied on cannabis establishments;

(20) Requirements for on-site consumption establishments, including for security, ventilation, odor control, and consumption by patrons;

(21) Requirements that cannabis retail stores stock cannabis products, including flower, with low and moderate amounts of THC; and

(22) Prohibiting unfair business practices, including slotting or shelf placement fees and price discrimination by cultivation facilities and product manufacturing facilities.

(b) After consulting with researchers knowledgeable about the risks and benefits of cannabis and providing an opportunity for public comment, the department shall develop at least two versions of a scientifically accurate safety information handout, which shall be available to each adult-use cannabis consumer. One of the versions must be specific to high potency products. The handout shall include:

(1) advice about the potential risks of cannabis and, in the case of the high potency handout, risks specific to high potency products, including:

(i) the risks of driving under the influence of cannabis, and the fact that doing so is illegal;

(ii) any adverse effects unique to younger adults, including related to the developing mind;

(iii) potential adverse events and other risks, including related to mental health; and

(iv) risks of using cannabis during pregnancy or breastfeeding.

(2) the need to safeguard all cannabis and cannabis products from children and pets; and

(3) unless federal statutory law or case law has changed and such a warning is no longer accurate, a disclosure that:

(i) cannabis is illegal under U.S. federal law, and

(ii) under the United States government’s 1986 Gun Control Act, any “unlawful” user of a controlled substance is prohibited from purchasing or owning a gun.

(c) The department shall review and update the safety information materials at least once every two years to ensure they remain accurate. The review period shall include soliciting input from researchers knowledgeable about the risks and benefits of cannabis and an opportunity for public comment.

(d) The department may require retail stores to display informational posters in conspicuous locations about the risks of cannabis use, risks specific to high potency products, or both.

(e) In order to ensure that individual privacy is protected, the department shall not require a consumer to provide a retail cannabis store with personal information other than government-issued identification to determine the consumer’s age, and a retail cannabis store shall not be required to acquire and record personal information about consumers.

Section 16. Cannabis Advisory Board.

(a) There shall be a cannabis advisory board to study and make recommendations consistent with the purpose and findings of this chapter on the regulation of cannabis and cannabis products.

(b) No later than 90 days after the effective date of this chapter, the governor shall nominate members of the advisory board, who shall be confirmed with the advice and consent of the Senate. The board shall consist of 13 members:

(1) one expert in public health;

(2) one physician who is knowledgeable about the risks and benefits of cannabis;

(3) one registered medical cannabis patient;

(4) one individual who represents cannabis consumers;

(5) four individuals with backgrounds in the cannabis industry, at least one of whom has a background in each cannabis cultivation, cannabis retailing, cannabis product manufacturing, and cannabis testing; at least two of those individuals must also qualify as social equity applicants;

(6) one individual with background in civil rights advocacy;

(7) one individual with background in law enforcement or security;

(8) one individual with expertise in environmental sustainability;

(9) one attorney with experience in cannabis policy or providing legal services related to cannabis; and

(10) An attorney designated by the office of the Attorney General to advise the taskforce.

(c) Members of the board shall serve terms of two years. Except in the case of members serving in their capacity as state employees, members of the board shall serve without compensation but shall be reimbursed for their expenses actually and necessarily incurred in the discharge of their official duties, including mileage at the state employee rate for attendance to meetings and other official functions.

(d) The board shall meet no less frequently than once every two months for the nine months after the effective date of this section and once every six months thereafter.

(e) The cannabis advisory board shall:

(1) Advise the department on regulations to ensure the thorough and efficient implementation of this chapter.

(2) Advise the department on what additional types of cannabis establishments, if any, the department should register, along with recommendations on their licensure and regulation.

(3) Consider all matters submitted to it by the department.

(4) Hold a hearing to solicit public input no less frequently than once every six months, including to solicit input on:

(i) the impact of adult-use cannabis regulations on medical access; and

(ii) the experience of social equity operators, and the effectiveness of measures to ensure they have the opportunity to succeed.

(5) Issue a preliminary report no later than 18 months after the effective date of this act, and a second report no later than nine months after federal legalization, reviewing the impacts of the potential legalization of cannabis under federal law on the state program, including a consideration of:

(i) whether federal legalization requires [State] to allow the sale of cannabis produced in other states;

(ii) what changes to state law and regulations are advisable or necessary due to federal legalization;

(iii) potential impacts on medical cannabis access and affordability; and

(iv) potential impacts on social equity and small business licensees.

(6) Make recommendations for whether the personal possession, cultivation, and purchase limits should be modified.

Section 17. Cannabis establishment licensure.

(a) Each application and renewal application for a license to operate a cannabis establishment shall be submitted to the department. Licenses expire after two years. A renewal application may be submitted up to 90 days prior to the expiration of the cannabis establishment’s license.

(b) The department shall begin accepting and processing applications to operate cannabis establishments from social equity applicants one year after the effective date of this act.

(c) The department may begin accepting and processing applications to operate cannabis establishments from applicants other than social equity applicants no earlier than one year and 180 days after the effective date of this act.

(d) Upon receiving an application or renewal application for a cannabis establishment, the department shall immediately forward a copy of each application and half of the license application fee to the local regulatory authority for the locality in which the applicant desires to operate the cannabis establishment, unless the locality has not designated a local regulatory authority.

(e) Each application applies to a single parcel of real property. Any additional address requires a separate application and license.

(f) Except as provided in Section 18, nothing in this chapter prevents a person or entity from holding multiple types of cannabis licenses and from co-locating the businesses.

(g) Within 120 days after receiving an application or renewal application, the department shall issue a biannual license or a conditional license to the applicant, unless the department finds the applicant is not in compliance with regulations enacted pursuant to Section 15 or the department is notified by the relevant locality that the applicant is not in compliance with ordinances and regulations made pursuant to Section 19 and in effect at the time of application.

(h) Applicants may apply for conditional approval if they have not purchased or leased the property where their cannabis establishment would be located. If the applicant is otherwise qualified for licensure, the department shall provide conditional approval. Once the applicant provides the department with a completed, supplemental application that includes the premises, the department shall forward the information to the local regulatory authority and approve or reject the final application within 45 days.

(i) Upon denial of an application, the department shall notify the applicant in writing of the specific reason for its denial.

(j) Cannabis establishments, and the books and records maintained and created by cannabis establishments, are subject to inspection by the department.

(k) The department may re-open the application window at any time. Each application period must be announced at least 90 days before applications are accepted. Applications must be accepted for a window of at least 30 days.

Section 18. Financial interests prohibited.

(a) No cannabis testing facility or individual with a significant interest in a cannabis testing facility shall have a direct or indirect financial interest in any other type of cannabis establishment.

(b) Prior to three years after the effective date of this act, no person or business entity may have a significant interest in more than five cannabis establishments of any single category.

(c) Beginning three years after the effective date of this chapter, no person or business entity may have a significant interest in more than 15 percent of any category of cannabis establishment other than a cannabis testing facility unless the person or entity has a significant interest in no more than five cannabis establishments of any category.

(d) No person or business entity may have a significant interest in more than 15 percent of the canopy licensed for cultivation.

(e) Beginning three years after the effective date of this chapter, no person or business entity may have a significant interest in more than 30 percent of cannabis testing facilities, unless the person or entity has a significant interest in no more than five cannabis testing facilities.

(f) No cannabis establishment or individual with a significant interest in a cannabis establishment may hold a significant interest in a vendor that provides cannabis inventory tracking in [State].

(g) No vendor that provides cannabis inventory tracking in [State] and no individual with a significant interest in a vendor that provides cannabis inventory tracking in [State] may hold a significant interest in a cannabis establishment.

(h) In this section, “significant interest” means any of the following:

(1) ownership or control of a cannabis establishment, or an agreement to acquire ownership or control in the future;

(2) a financial or voting interest of 10 percent or greater;

(3) a financial or voting interest of 10 percent or greater in an entity that exercises management or operational control of the cannabis establishments.

(i) This section does not apply to loans from financial institutions or governmental lending programs.

Section 19. Local control.

(a) (1) No later than 180 days after the enactment of this chapter, the governing body of a locality may vote to place a question on the ballot of the first general election after the enactment of this chapter. In the case of a municipality that is not a county, the wording of the question shall be substantially as follows: “Shall the operation of cannabis retail stores be allowed within [the jurisdiction]?” In the case of a municipality that is a county, the wording of the question shall be substantially as follows: “Shall the operation of retail cannabis stores be allowed in unincorporated areas of [the county]?”

(2) If a majority of those voting on the question vote "yes," retail cannabis stores may operate within the locality.

(3) If the governing body of a municipality elects not to hold an election on the ballot question, retail cannabis stores may be operated within the locality.

(b) Voters in a locality that previously prohibited the operation of one or more types of cannabis establishments may authorize their operation through an initiated or referred measure, provided, any initiated or referred measure to allow or prohibit the operation of establishments must appear on a general election ballot.

(c) A locality may adopt reasonable restrictions on the time, place, and manner of the operation of cannabis establishments, and may limit the number of each type of cannabis establishment, provided it does not make the operation of a cannabis establishment unreasonably impracticable.

(d) No locality may negotiate or enter into a host community agreement with a cannabis establishment or a cannabis establishment applicant. As used in this section, a “host community agreement” means an agreement that the cannabis establishment or applicant provides monies, donations, in-kind contributions, services, or anything of value to the locality.

Section 20. Minors.

Nothing in this chapter is intended to permit the transfer of cannabis, with or without remuneration, to a person under the age of 21 or to allow a person under the age of 21 to purchase, possess, use, transport, grow, or consume cannabis.

Section 21. Private property and tenant rights.

(a) Except as provided in this section, the provisions of this chapter do not require any person, corporation, or any other entity that occupies, owns, or controls a property to allow the consumption, cultivation, display, sale, or transfer of cannabis on or in that property.

(b) Except as provided in this section, in the case of the rental of a residential dwelling, a landlord or property manager may not prohibit the possession of cannabis or the consumption of cannabis.

(1) The limitations in this subsection do not apply if:

(i) The tenant is a roomer who is not leasing the entire residential dwelling;

(ii) The residence is incidental to detention or the provision of medical, geriatric, educational, counseling, religious, or similar services;

(iii) The residence is a transitional housing or sober living facility; or

(iv) Failing to prohibit cannabis possession or consumption would violate federal law or regulations or cause the landlord to lose a monetary or licensing-related benefit under federal law or regulations.

(2) A landlord or property manager may prohibit cannabis smoking in a rented property if:

(i) smoking is prohibited in the resident’s lease; and

(ii) the resident’s smoking of cannabis creates an odor that interferes with others’ peaceful enjoyment of their home.

(3) A landlord or property manager must provide a written warning at least 14 days before taking action against a resident whose smoking of cannabis creates an odor that interferes with others’ peaceful enjoyment of their home.

Section 22. Contracts enforceable.

It is the public policy of [State] that contracts related to the operation of a cannabis establishment registered pursuant to this chapter should be enforceable. It is the public policy of this state that no contract entered into by a cannabis establishment or its employees or agents as permitted pursuant to a valid license, or by those who allow property to be used by an establishment, its employees, or its agents as permitted pursuant to a valid license, shall be unenforceable on the basis that cultivating, obtaining, manufacturing, distributing, dispensing, transporting, selling, possessing, or using cannabis or hemp is prohibited by federal law.

Section 23. Respecting state law.

(a) No law enforcement officer employed by an agency that receives state or local government funds shall expend any state or local resources, including the officer’s time, to effect any arrest or seizure of cannabis, or conduct any investigation, on the sole basis of activity the officer believes to constitute a violation of federal law if the officer has reason to believe that such activity is in compliance with this act, nor shall any such officer expend any state or local resources, including the officer’s time, to provide any information or logistical support related to such activity to any federal law enforcement authority or prosecuting entity.

(b) No agency or political subdivision of [State] may rely on a violation of federal law related to cannabis as the sole basis for taking an adverse action against a person.

(c) For the purposes of [State] law, actions related to cannabis are considered lawful as long as they are in accordance with this chapter.

Section 24. Cannabis Fund.

The Cannabis Fund is established consisting of fees collected and civil penalties imposed under this chapter. The department shall administer the fund. Monies in the fund are continuously appropriated.

Section 25. Cannabis excise tax.

(a) There is imposed a cannabis excise tax equal to 9 percent of the sales price of each sale in [State] of cannabis and cannabis products to a consumer. [Sales to registered medical cannabis patients pursuant to a medical cannabis program are exempt from the tax imposed under this section.]

(b) The tax imposed by this section shall be paid by the consumer to the cannabis establishment. Each cannabis establishment shall collect from the consumer the full amount of the tax payable on each taxable sale.

(c) On the 15th day of each month, every cannabis establishment that sells cannabis to consumers shall pay the excise taxes due on the cannabis that the cannabis establishment sold in the prior calendar month.

(d) The tax imposed by this section shall not be part of the sales price to which a cannabis local option tax applies.

(e) The cannabis excise tax shall be separately itemized from the cannabis excise tax on the receipt provided to the purchaser.

Section 26. Cannabis local option tax.

(a) Any municipality may collect a cannabis local option tax of three percent of the sales price on each sale in [State] of cannabis and cannabis products to a consumer in the municipality. [Sales to registered medical cannabis patients pursuant to a medical cannabis program are exempt from the tax imposed under this section.]

(b) In the case of deliveries:

(1) any municipality may collect a cannabis local option tax of 1.5 percent of the sales price on each sale in [State] for deliveries to locations within the municipality; and

(2) any municipality may collect a cannabis local option tax of 1.5 percent of the sales price on each sale in [State] for deliveries originating within the municipality.

(c) A cannabis local option tax may be adopted by a municipality that has: provided notice of the imposition and the amount to the [department of taxation] at least 90 days prior to the first day of the tax quarter when the cannabis local option tax will be collected.

(d) The tax imposed by this section shall be paid by the consumer to the cannabis establishment. Each cannabis establishment shall collect from the consumer the full amount of the tax payable on each taxable sale.

(e) On the 15th day of each month, every cannabis establishment that sells cannabis to consumers shall pay the local option taxes due on the cannabis that the cannabis establishment sold in the prior calendar month.

(f) The tax imposed by this section is separate from and in addition to the cannabis excise tax authorized under Section 25 of this title. The tax imposed by this section shall not be part of the sales price to which the cannabis excise tax applies. The cannabis local option tax shall be separately itemized from the cannabis excise tax on the receipt provided to the purchaser.

Section 27. Apportionment of revenue.

Revenues generated in excess of the amount needed to implement and enforce this act by the cannabis excise tax shall be distributed every three months as follows:

(a) For the first three fiscal years after the effective date, twenty percent shall be distributed to the Community Reinvestment and Repair Fund, administered by the Office of Social Equity pursuant to Section 14. Beginning in the fourth fiscal year after the effective date, thirty percent shall be distributed to the Community Reinvestment and Repair Fund, administered by the Office of Social Equity pursuant to Section 14;

(b) For the first three fiscal years after the effective date, ten percent shall be distributed to the Social Equity Fund, administered by the Office of Social Equity pursuant to Section 14;

(c) Five percent shall be distributed to the Cannabis Education and Technical Assistance Fund, administered by the Office of Social Equity pursuant to Section 14;

(d) Ten percent shall be distributed to the [State health department] for use in evidence-based, voluntary programs for the prevention or treatment of substance abuse;

(e) Two percent shall be distributed to the [State health department] for a scientifically and medically accurate public education campaign educating youth and adults about the health and safety risks of alcohol, tobacco, cannabis, and other substances, including the risks of driving while impaired;

(f) Two percent shall be distributed to the [State health department] to fund diverse scientific, academic, or medical research on cannabis or endocannabinoids, including research exploring the benefits of cannabis, provided that all funded research data, results, and papers shall be released into the public domain and shall be published for free and open access by the public and by other researchers;

(g) Up to one percent shall be distributed to the [State public safety department] to fund Advanced Roadside Impaired Driving Enforcement and drug recognition expert training. If the entire one percent is not needed for the training, any excess shall be distributed to the General Fund; and

(h) Fifty percent shall be distributed to the General Fund.

Section 28. Re-sentencing for cannabis convictions.

(a) As used in this section, “cannabis-related offense” means any of the following:

(1) any offense for the possession, cultivation, manufacture, distribution, sale, transportation, or possession with intent to deliver cannabis;

(2) any offense for the possession, cultivation, manufacture, distribution, sale, transportation, or possession with intent to deliver paraphernalia intended for cannabis; and

(3) any other offense that would not have been an offense were it not for the illegality of cannabis.

(b) Any person who was convicted of any cannabis-related offense that occurred prior to the effective date of this act who has not completed the sentence may, at any time, petition the court in which the person was convicted for re-sentencing.

(c) No later than 90 days after the effective date of this act, the [appropriate state agency] and the [administrator of each state prison, and county and city jail and probation department] shall conduct a search to determine all individuals serving a period of incarceration or supervision for a cannabis-related offense and notify the court in which each person was convicted and the [appropriate state agency] that the conviction must be considered for re-sentencing pursuant to this section.

(d) The court in which the person was convicted shall provide a written notification within three days to the office of the prosecutor of the underlying offense that the conviction will be considered for re-sentencing pursuant to this section. The prosecutor may object within 45 days of receiving notice and request a hearing. If the prosecutor does not object within 45 days, the court shall grant the petition and re-sentence the person to the portion of the sentence the individual has already completed.

(e) If the prosecutor timely objects, the court shall notify the [public defender’s office] within three days and shall hold a hearing within 30 days.

(f) The court shall re-sentence the individual to any sentence they have already completed unless the prosecutor proves by clear and convincing evidence that:

(1) The offense is not eligible for re-sentencing under this section because it was not a cannabis-related offense;

(2) Re-sentencing would not be in the interests of justice; or

(3) Re-sentencing would be in the interests of justice, but the appropriate sentence is something other than the portion of the sentence the individual has already completed.

(g) There shall be a presumption that granting the petition would be in the interests of justice due to the legalization of cannabis for adults and the unequal enforcement of cannabis laws. The presumption may be overcome, including in instances where the prosecutor proves by clear and convincing evidence that re-sentencing would not be in the interests of justice because:

(1) an additional, more serious charge for an offense that was not a cannabis-related offense was dismissed as part of a plea deal; or

(2) the offense involved distribution of cannabis by an adult to a minor or using a minor to distribute cannabis.

(h) The court may find that re-sentencing is in the interests of justice, but that a complete reduction in the sentence is not in the interests of justice. In those instances, the court shall re-sentence the individual to the lowest sentence that is in the interests of justice, in light of legalization of cannabis and disparities in arrests and sentencing.

(i) A court may not increase any aspect of a sentence in response to a re-sentencing petition filed pursuant to this section.

(j) Each court shall report to [appropriate agency] on the disposition of all cases considered for re-sentencing pursuant to this section within 15 days of the decision.

(k) No fee shall be charged for filing a petition under this section.

(l) The [public defender’s office] shall provide representation with no charge to any person who files a petition for relief, or whose sentence is subject to an automatic re-sentencing hearing pursuant to this section. An individual shall not be required to prove indigence to receive representation pursuant to this section.

(m) No later than 270 days after the effective date of this act, and no later than one year thereafter, the [appropriate agency] shall produce a public report that includes:

(1) the number of cases considered for court-initiated resentencing pursuant to this section;

(2) the number of cases considered for petition-based resentencing pursuant to this section;

(3) the number of cases where the individual was re-sentenced to the sentence already served;

(4) the number of cases where the individual was re-sentenced to a lesser sentence, but not the sentence already served;

(5) the number of cases where there was no change to the sentence;

(6) the average amount of incarceration and supervision reduced from sentences in cases considered pursuant to this section; and

(7) the total number of individuals incarcerated and under supervision for offenses where re-sentencing was considered pursuant to this section at the time of the report.

(n) The [appropriate state and local agency or agencies, including the public defender’s office] shall determine the actual costs of duties under this section and be reimbursed from the Cannabis Fund.

Section 29. Cannabis Clean Slate.

(a) All arrests, convictions, charges, and civil adjudications for possession of cannabis and for possession of cannabis paraphernalia prior to the effective date of this act shall be expunged and sealed.

(b) All arrests, charges, and convictions for distributing, selling, manufacturing, and possession with intent to distribute cannabis or cannabis paraphernalia prior to the effective date of this act shall be expunged and sealed after the completion of the sentence of supervision or incarceration, unless the prosecutor timely objects to the expungement and a court finds expungement would not be in the interests of justice.

(c) Within 12 months of the effective date of this act, [appropriate state and local agency or agencies] shall identify all records of arrests or convictions for possession of cannabis that occurred prior to the effective date of this act, expunge and seal the record and notify the court from which the case originated and [appropriate state and local agency or agencies].

(d) (1) Within 18 months of the effective date of this act, [appropriate state and local agency or agencies] shall identify all records of arrests or convictions for cannabis or cannabis paraphernalia distribution, sales, possession with intent to deliver, manufacture, or cultivation for which the term of incarceration and supervision has been completed.

(2) For each case, the court in which the person was convicted shall provide a written notification to the office of the prosecutor of the underlying offense within 15 days. The prosecutor may object within 90 days of receiving notice and request a hearing. If the prosecutor does not object within 90 days, the record shall be expunged.

(3) If the prosecutor timely objects, the court shall hold a hearing. The court shall order the record expunged unless the prosecutor proves by clear and convincing evidence that:

(i) The offense is not eligible for expungement under this section because it was not a cannabis-related offense; or

(ii) Expungement would not be in the interests of justice.

(4) There shall be a presumption that expungement would be in the interests of justice due to the legalization of cannabis for adults. The presumption may be overcome in cases involving violence, distribution of cannabis to a minor, or using a minor to distribute cannabis.

(e) For any record expunged pursuant to this section:

(1) The court from which the case originated shall place an order of expungement and sealing in the court file.

(2) The law enforcement agency from which the case originated shall place an order of expungement and sealing in the file.

(3) Whenever the records of any arrest, charge, or conviction of a person have been expunged under the provisions of this section, any custodian of the records relating to that offense shall not disclose the existence of the records upon inquiry from any source, unless the inquiry is that of the person whose record was expunged. Upon request from any person to access a record of an expunged offense, the custodian shall respond as if no such record exists unless the requestor is the person whose record was expunged.

(4) The existence of convictions in other counts within the same case that are not eligible for expungement pursuant to this section or other applicable laws shall not prevent any conviction otherwise eligible for expungement under this section from being expunged pursuant to this section. In such circumstances, the court shall make clear in its order what counts are expunged and what counts are not expunged or remain convictions. In such circumstances, any expungement pursuant to this subsection shall not affect the records related to any count or conviction in the same case that are not eligible for expungement.

(5) No fee shall be charged to any person filing a motion to access a record that has been sealed if the person filing such motion is the person whose record was expunged.

(6) In any application for employment, housing, license, or other civil right, benefit, or privilege, or any appearance as a witness, or any other matter, a person whose conviction of a crime or civil offense has been expunged pursuant to this section may state that the person has never been convicted of the offense.

(7) Any conviction ordered expunged pursuant to this section shall not be considered as a prior arrest or conviction when determining the sentence to be imposed for any subsequent crime.

(8) The Supreme Court, Court of Appeals, and any circuit court shall not be required to prohibit dissemination of any published or unpublished opinion relating to an arrest, charge, or conviction that was ordered to be expunged.

(9) Eligible expungements of arrests, charges, convictions, and civil adjudications pursuant to this section shall be granted notwithstanding the existence of outstanding court-imposed or court-related fees, fines, costs, assessments, or charges. Any outstanding fees, fines, costs, assessments, or charges related to the eligible conviction shall be waived.

(10) Nothing in this section shall be construed to require the court or any agency to reimburse an individual with an expunged offense for fines, fees, and costs previously incurred, paid or collected in association with the eligible conviction.

(f) Any person who believes themselves to be eligible for automatic expungement pursuant to this section may request that the [appropriate agency] examine his or her arrest or conviction to determine whether it should be expunged. Should the [appropriate agency] fail to expunge a qualified conviction, any person so aggrieved may petition the court without fee for further review of eligibility.

(g) No later than two years after the effective date of this act, the [appropriate agency] shall produce a public report that includes:

(1) the number of cases considered for state-initiated expungement pursuant to this section;

(2) the number of cases considered for petition-based expungement pursuant to this section;

(3) the number of cases where the record was expunged pursuant to this section; and

(4) the number of cases where expungement was considered pursuant to this section and where expungement was denied.

(h) The [appropriate state and local agency or agencies] shall determine the actual costs of processing such expungement and be reimbursed from the Cannabis Fund.

(i) Nothing in this section shall be construed to restrict or modify a person's right to have the person's records expunged, except as otherwise may be provided by law, or diminish or abrogate any rights or remedies otherwise available to the person.

Section 30. Wrongful disclosure expunged cannabis convictions, penalty.

(a) As used in this section, "business screening service" means a person engaged in the business of collecting, assembling, evaluating, or disseminating criminal history records on individuals that include criminal history records on individuals from [state]. It does not include any government entity or the news media.

(b) A business screening service shall implement and follow reasonable procedures to assure that it does not maintain or sell criminal history records that include expunged or sealed records from [State].

(c) If the disputed record is found to have been sealed pursuant to this section, the business screening service shall promptly delete the record.

(d) A business screening service that violates this section is liable to the person who is the subject of the criminal history record for a penalty of $1,000 or actual damages caused by the violation, whichever is greater, plus costs and reasonable attorney fees. Within 10 days of service of any suit by an individual, the business screening service may make a cure offer in writing to the individual claiming to have suffered a loss as a result of a violation of this section. Such an offer shall be in writing and include one or more things of value, including the payment of money. A cure offer shall be reasonably calculated to remedy a loss claimed by the individual, as well as any attorney fees or other fees, expenses, or other costs of any kind that such individual may incur in relation to such loss.

(e) The Attorney General may file a civil action to enforce this section. If the court finds that a business screening service has willfully engaged in an act or practice in violation of this section, the Attorney General may recover, upon petition to the court, a civil penalty of not more than $2,500 per violation.

(f) A business screening service that disseminates criminal history records from [State] is deemed to have consented to service of process in the [State] and to the jurisdiction of courts of the [State] for actions involving a violation of this section or for the recovery of remedies under this section.

Section 31. Dismissal of cannabis charges.

(a) Except to the extent required to dismiss, withdraw, or terminate the charge, no prosecutor shall pursue any charge based on crimes or offenses pending with a court that occurred prior to the effective date of this act that consists of a person 21 years of age or older knowingly or purposely obtaining, purchasing, transporting, manufacturing, or possessing, actually or constructively, or having under his or her control no more than the possession limit of cannabis or paraphernalia for cannabis.

(b) The existence of additional charges that are not eligible for dismissal pursuant to this section shall not prevent any charge otherwise eligible for dismissal under this section from being dismissed pursuant to this section.

(c) Any guilty verdict, plea, placement in a diversionary program, or other entry of guilt on a matter that was entered prior to the effective date of this act, but the judgment of conviction or final disposition on the matter was not entered prior to that date, and the guilty verdict, plea, placement in a diversionary program, or other entry of guilt solely involved one or more crimes or offenses involving a person 21 years of age or older knowingly or purposely obtaining, purchasing, transporting, manufacturing or possessing, actually or constructively, or having under his or her control, no more than the possession limit of cannabis or paraphernalia for cannabis, shall be vacated by operation of law. The [appropriate agency], in consultation with the Attorney General, may take any administrative action as may be necessary to vacate the guilty verdict, plea, placement in a diversionary program, or other entry of guilt.

Section 32. Self-executing, severability, conflicting provisions.

All provisions of this chapter are severable, and, except where otherwise indicated in the text, shall supersede conflicting statutes, local charters, ordinances, or resolutions, and other state and local provisions.

Section 33. Effective date.

This chapter shall take effect upon its approval.

Additional Sections That Will Vary Depending on State Law

A. Revising criminal laws, consider descheduling cannabis.

Existing laws prohibiting cannabis and paraphernalia need to be revised to remove penalties for the conduct that was made legal. At a minimum, the following should be included in the chapter with criminal penalties for drug offenses:

The possession, manufacture, harvest, display, distribution, packaging, processing, purchase, transportation, transfer, delivery, sale, storage, and consumption of cannabis as authorized by [Section 2 to 33 of this bill] shall not constitute a violation of this chapter.

In addition, existing criminal penalties for cannabis should be reduced to penalties that are more proportionate to the offense. Possession of double the possession limit should be a modest civil offense. All mandatory minimums for cannabis should be eliminated. Maximum penalties should be on par with the maximum penalties for illegal sales of alcohol.

It is also worth considering removing cannabis from the state’s schedule of controlled substances. However, doing so may require rewriting all existing prohibitions on conduct that remains illegal, such as illegal sales or large-scale cultivation.

B. Providing for decriminalization and education for those under 21, if the state has not already done so.

If the state already has a civil penalty for simple possession of cannabis, it will need to be amended to only apply to those under 21. If the state does not impose a civil penalty for simple possession of cannabis, it should do those for those under 21. Incarceration is traumatic and excessively harsh for a young person possessing cannabis.

For example:

(a) Possession of no more than a personal use quantity of cannabis by a person under the age of 21 is a civil violation punishable by forfeiture of the cannabis and a fine of up to $75. A person found responsible for a violation under this section may request, and shall be granted, a penalty of up to seven hours of community service in lieu of a fine.

(b) The parents or legal guardian of any offender under the age of 18 shall be notified of the offense.

If possession of paraphernalia is a crime in the state, it should either become legal or should also be decriminalized for minors.

C. Providing that medical cannabis provisions, if any, are not affected, and that cannabis taxes do not apply to medical cannabis.

For example:

Nothing in this chapter shall be construed to limit any privileges or rights of a medical cannabis patient, primary caregiver, or medical cannabis establishment, under [State medical cannabis law].

The precise language should track the terms used in the state’s medical cannabis law.

D. If the state has a medical cannabis law, provide for dual licensing for medical cannabis businesses.

Medical cannabis businesses should be allowed to also serve the adult-use market if they meet requirements. A single regulatory authority should oversee both types of businesses, so this may require moving the medical cannabis program to a new agency.

Many states allow medical businesses to begin sales to adult-use consumers before other businesses. To do so, they typically have to pay a significant conversion fee (often to help fund social equity applicants) and to prioritize medical cannabis access.

In addition, all adult-use retailers should also be allowed to sell to registered patients tax-free if they meet requirements that apply to other medical businesses (such as requiring dispensing staff to meet additional training requirements, prioritizing patient access, and stocking a variety of medical products).

E. Modifying driving under the influence law, if it penalizes having any metabolites of THC in one’s system.

Cannabis metabolites can stay in one’s system for up to a month, and active THC can stay for well over a week. Some state laws penalize individuals for driving with metabolites or THC in their system. If that is the case, state law needs to be modified to avoid criminalizing sober drivers – and instead only penalize those driving while impaired. Language will vary and will modify existing statutes.

F. Exempting cannabis from standard sales taxes.

This bill provides for up to 12% in state and local taxes on cannabis sales. To avoid excessive taxation, cannabis sales should be exempted from generally applicable state and local sales taxes.

G. Fixing state income tax so that business expenses are deductible, though they are not deductible at the federal level.

Existing tax statutes will need to be modified and language will need to mirror the statutory language. Here is an example:

A deduction from gross business profits of an amount equal to all the ordinary and necessary expenses paid or incurred during the taxable year in carrying on a trade or business as a cannabis establishment as defined by [Section 2 (j)], including a reasonable allowance for salaries or other compensation for personal services actually rendered, notwithstanding any federal tax law to the contrary.

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Model Bill to Equitably Legalize and Regulate Cannabis

Additional Sections That Will Vary Depending on State Law

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