Gov. Ned Lamont’s 2021 proposal to end cannabis prohibition – S.B. 888 – would replace the unregulated illicit market with a taxed and regulated system of licensed cultivators, retailers, manufacturers, and delivery services. The bill also includes strong protections for public safety and deterrents for underage use. It directs an Equity Commission to develop equity-related recommendations by November 2021.
FILE COPY 569 JFS LANGUAGE
Personal Liberty and Possession Limits
Redresses Harms Caused by Prohibition and Unequal Enforcement
Protections to Prevent Underage Usage
Penalties for Underage Use
Individuals age 18 to 20:
Individuals under age 18:
Public Health and Safety
Clean Indoor Air:
1. Streetscape improvements and other neighborhood developments in communities where cannabis or hybrid retailers or micro-cultivators are located.
2. Youth employment and training programs in these municipalities.
3. Services for individuals living in these municipalities who were released from DOC custody, probation, or parole.
4. Mental health or addiction services.
5. Community civic engagement efforts.
License and Regulatory Structure
Establishes a three-member Cannabis Control Commission to regulate cannabis licenses. The governor appoints two commissioners, and the DCP Commissioner serves as Chairperson. Governor fills any vacancy.
Starting July 1, 2021, the bill allows DCP to accept applications from social equity applicants for the following licenses:
2. hybrid retailer (which sells both adult-use and medical cannabis)
4. micro-cultivator (which start at no more than 5,000 square feet)
5. product manufacturer
6. food and beverage manufacturer
7. product packager
8. delivery service
On the same date, DCP may also accept applications from (1) medical marijuana dispensary facilities to convert their license to a hybrid-retailer (which can also serve adults), and (2) medical marijuana producers for authorization to expand their license to engage in the adult-use cannabis market.
Starting January 1, 2024, DCP may accept applications from anyone for adult-use cannabis licenses.
Existing medical businesses: The license conversion fee for a dispensary facility to become a hybrid retailer (which can serve adults) is $250,000. The license expansion fee for a producer to engage in the adult-use cannabis market is $750,000. Those fees are paid to the cannabis social equity account.
Fees paid by other cannabis applicants and licensees are:
1. A retailer or hybrid retailer fee or product packager fee to enter the lottery is $500, the fee for a provisional license is $5,000, and the fee for a final license is $25,000;
2. A cultivator fee to enter the lottery is $1,000, the fee for a provisional license is $25,000, and the fee for a final license is $75,000;
3. A micro-cultivator fee to enter the lottery is $250, the fee for a provisional license is $500, and the fee for a final license is $1,000;
4. A product manufacturer fee to enter the lottery is $750, the fee for a provisional license is $5,000, and the fee for a final license is $25,000; and
5. A food and beverage manufacturer fee or delivery service fee to enter the lottery is $250, the fee for a provisional license is $1,000, and the fee for a final license is $5,000.
The license fee for a backer or key employee is $100; employee registrations for others are $50. Individuals are disqualified from owning a cannabis establishment if they have a conviction within the last 10 years for money laundering, vendor fraud, insurance fraud, forgery, filing a false record, bribery, witness tampering, perjury, false statement on a certified payroll, bribery of a labor official, bribery of commercial bribe, receiving kickbacks, paying kickbacks, rigging, telephone fraud, identity theft, or willful tax evasion in any state.
If the application period for a license type closes and DCP received more than the maximum number of applications, a third-party lottery operator must conduct a lottery to select applications for DCP review.
The bill requires that all applicants selected in the lottery and not disqualified be provided a provisional license application.
Applicants must complete their application within 60 days after they receive it and the right to apply for a provisional license is nontransferable.
A provisional license expires after 14 months and is not renewable. A provisional licensee may apply for a final license during the initial application period. Final license application requires:
1. A contract with an approved seed-to-sale vendor in accordance with the bill’s provisions;
2. A right to occupy the location where the cannabis establishment will be located;
3. Any necessary local zoning approval for the cannabis establishment;
4. A social equity plan;
5. Written policies for preventing diversion and misuse of cannabis and sales to underage persons;
6. All other security requirements set forth by the department based on the specific license type; and
7. A labor peace agreement entered into between the cannabis establishment and a bona fide labor organization.
Only cannabis establishments with approved final licenses can begin operations. Under the bill, legal sales would begin May 4, 2022.
Social Equity and Industry Inclusion
Note: Leadership assures advocates that the final bill will not include the provision allowing for social equity qualification based on control — and not ownership.
1. Investing in programs that are located in or primarily serve residents of disproportionately affected communities, including adult education programs (including programs offered by Unified School District #1) and programs to assist individuals released from DOC custody, probation, or parole;
2. Providing grants to youth service bureaus and municipal juvenile review boards;
3. Funding workforce development and business incubator and accelerator programs that support social equity applicants and prospective applicants; and
4. Funding programs and services that promote and encourage economic opportunity and advancement of individuals from disproportionately affected communities.
Within 45 days after bill passage, the Social Equity Council must establish criteria for proposals for an independent third party to conduct a study addressing the following issues, in relation to Connecticut:
1. Historical and current social, economic, and familial consequences of cannabis prohibition, the criminalization and stigmatization of cannabis use, and related public policies;
2. Historical and current structures, patterns, causes, and consequences of intentional and unintentional racial discrimination and disparities in the development, application, and enforcement of this prohibition and related public policies;
3. Foreseeable long-term social, economic, and familial consequences of unremedied past racial discrimination and disparities arising from past and continued cannabis prohibition, stigmatization, and criminalization;
4. Existing patterns of racial discrimination and disparities in access to entrepreneurship, employment, and other economic benefits arising in the state’s medical marijuana sector; and
5. Any other matters that the council deems relevant and feasible to study for making reasonable and practical recommendations for establishing an equitable and lawful adult-use cannabis business sector.
1. Creating programs to ensure that individuals from disproportionately harmed communities have equal access to cannabis establishment licenses;
2. Specifying additional qualifications for social equity applicants;
3. Providing for expedited or priority license processing for social equity applicants for retailer, hybrid retailer, cultivator, micro- cultivator, product manufacturer, food and beverage manufacturer, product packager, and delivery service licenses;
4. Establishing minimum criteria for cannabis establishments licensed on or after January 1, 2022 that are not owned by a social equity applicant to comply with an approved plan to reinvest or provide jobs and training opportunities for individuals in disproportionately affected communities;
5. Recruiting individuals from these communities to the workforce training program established under the bill;
6. Developing an objective scoring system for evaluating final license applications to ensure cannabis establishments are furthering equity;
7. Potential uses for revenue generated under the bill to further equity;
8. Encouraging participation by investors, cannabis establishments, and entrepreneurs in the cannabis business accelerator program established under the bill;
9. Establishing a process to best ensure that social equity applicants have access to the capital and training needed to own and operate cannabis establishments; and
10. Developing a vendor list of women- and minority-owned businesses that cannabis establishments may contract with for necessary services, such as office supplies, information technology infrastructure, and cleaning services.
Protecting Medical Cannabis Patients