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Published on Friday, March 29, 2013

Senate introduces bill to license and tax medical marijuana

On Thursday, Sen. Ann Rivers (R-Ridgefield) introduced SB 5887 regarding medical marijuana. The bill establishes licensing and taxation requirements for medical marijuana and makes other various changes:

  • Requires a patient to complete an in-person exam with their medical provider prior to receiving an authorization for medical marijuana.
  • Requires medical marijuana producers, processors, and dispensaries to be licensed by the Liquor Control Board (LCB). The LCB has until July 1, 2014, to implement a licensing program. Collective gardens are not required to be licensed.
  • Provides arrest protection to owners, employees and members of licensed dispensaries. Provides immunity from criminal and civil penalties to licensed medical cannabis producers and processors and their employees.
  • Makes minor changes to the collective garden provisions to say that 10 qualifying patients may participate in a single collective garden per day, instead of at any time. The collective garden section also includes a veto provision that says if the Governor vetoes any part of the act, then the collective garden section doesn’t take effect.
  • Retains language providing cities authority over zoning, land use, business licensing, and health and safety requirements. It also retains language that preempts cities from banning medical cannabis dispensaries. This language was included in the law in 2011, but referenced licensed dispensaries, which didn’t exist because there was no state licensing in place.
  • Imposes a new 20% excise tax on the wholesale sale of medical cannabis to a processor or dispensary. It does not include a special excise tax on the retail sale of medical marijuana. The revenue collected will go to the state general fund.

There are concerns that it will be difficult for the legal recreational marijuana market created by I-502 to compete with the unregulated and untaxed medical marijuana market. Some in the medical marijuana industry have long sought legitimacy through a state licensing process. This bill appears to try to address both of these issues. However, we are sensitive to the impacts these changes may have on cities.

SB 5887 has not yet been scheduled for a hearing. We will continue to monitor this bill, and we are seeking feedback from cities on the potential impact at the local level. Please send comments to Brittany Sill or Candice Bock