In California, These Cannabis Bills Are Headed to Gov. Newsom

Mon, Sep 18
Key Points
  • Deadline for bills to be sent to Gov. Gavin Newsom's desk in California has passed, with over a dozen cannabis-related bills making the cut.
  • One bill that stalled is AB 420, which aimed to clarify regulations around hemp products and their cannabinoid content.
  • AB 374 is a notable bill that would expand cannabis consumption spaces to include the sale of non-cannabis food and beverage products, as well as live performances.
  • Another bill, AB 766, which addresses unpaid debt in the cannabis industry, is expected to resurface in January.

Another year, another pile of bills that will continue to shape the country’s largest legal cannabis market. 

The deadline for lawmakers to send bills to Gov. Gavin Newsom’s desk came and went on September 14, and more than a dozen made the cut. While several of the bills make minor tweaks, others, like a bill to expand allowances for cannabis cafés, could provide a boost to the state’s industry and transform tourism in the state. 

Some bills lost steam before passage but prompted robust debate. One closely-watched bill stalled in the days before the deadline: AB 420. The bill was, at first, straightforward in its language that cannabis licensees could make and sell products “that contain industrial hemp or cannabinoids, extracts, or derivatives from industrial hemp, if the product complies with all applicable state laws and regulations.”

But things quickly got contentious as the bill was amended to clarify which cannabinoids, and how much, could be in the products. By the time the bill stalled, it aimed to “expand the prohibition that raw hemp extract not exceed 0.3% of a tetrahydrocannabinol comparable cannabinoid” and to prohibit any hemp product that “contains a cannabinoid that is not present in nature in commercially meaningful quantities.”

The California Cannabis Industry Association, which led the push for the bill, argued for “a non-detectable THC cap” for hemp products. The U.S. Hemp Roundtable said the group’s proposed limits went too far and pointed to it as an example of “monopolistic marijuana interests” trying to “impede on the hemp industry.” However, CCIA later called the Roundtable’s view that hemp products could contain up to 5 mg THC “very concerning.” 

California has a two year legislative session, so some of the efforts that were stalled this year may reemerge in January. 

“We are disappointed the effort to keep illegal, intoxicating hemp products from kids was not successful this year,” said California Assembly Speaker pro Tempore Cecilia Aguiar-Curry. “I will be back next year, looking to increase regulation of and enforcement against these products, to establish responsible caps on THC levels, treating all intoxicating hemp and cannabis products equally, and supporting legal cannabis and hemp retailers and manufacturers by offering them the opportunity to integrate production and sales.”

Another closely-watched bill is expected to resurface in January: AB 766, which aims to address the issue of unpaid debt in the industry. 

“For years, restrictions at the federal level have left our state’s legal cannabis operators with limited options for financing and capital. This has led to a severe debt bubble across the supply chain from cultivators all the way through to the retailers,” Assemblymember Phil Ting, the bill sponsor, said in a statement in May, adding that his bill would help to ensure “that operators receive payment for goods and services in a timely manner.”

In the meantime, here are the noteworthy cannabis bills on, or headed to, Newsom’s desk:

AB-374 – Author: Asm. Matt Haney

This legislation is responsible for the rumblings that California could soon take cannabis tourism to the next level. The bill expands what’s allowed in cannabis consumption spaces by including “the preparation or sale of noncannabis food or beverage products, as specified, by a licensed retailer or microbusiness in the area where the consumption of cannabis is allowed.” The bill would also allow for the sale of “tickets for, live musical or other performances on the premises of a licensed retailer or microbusiness in the area where the consumption of cannabis is allowed.”

“Lots of people want to enjoy legal cannabis in the company of others,” Assemblymember Haney told Cannabis Wire earlier this year. “And many people want to do that while sipping coffee, eating a scone, or listening to music. There’s absolutely no good reason from an economic, health or safety standpoint that the state should make that illegal. If an authorized cannabis retail store wants to also sell a cup of coffee and a sandwich, we should allow cities to make that possible and stop holding back these small businesses.”

SB-302 – Author: Sen. Henry Stern

The bill expands Ryan’s Law, which requires “health care facilities to allow a terminally ill patient’s use of medicinal cannabis,” to include patients who are “over 65 years of age with a chronic disease.”

The bill was amended to note that it will “authorize a health care facility to suspend compliance with these provisions if a regulatory agency, the United States Department of Justice, or the federal Centers for Medicare and Medicaid Services makes an inquiry about the health care facility’s activities.”

SB-700 – Author: Sen. Steven Bradford

This bill would “make it unlawful for an employer to request information from an applicant for employment relating to the applicant’s prior use of cannabis.”

The bill was amended to clarify that “information about a person’s prior cannabis use obtained from the person’s criminal history would be exempt from the above-described existing law and bill provisions relating to prior cannabis use if the employer is permitted to consider or inquire about that information under a specified provision of the California Fair Employment and Housing Act or other state or federal law.”

AB 1207 – Author: Asm. Jacqui Irwin

The bill, also known as the Cannabis Candy Child Safety Act, is aimed at products that might be “attractive to children.” This includes words like “candy” or “close imitations of brand names” that are “typically marketed to children,” for example.

SB-540 – Author: Sen. John Laird

This bill requires regulators to “create and post for public use a single-page flat or folded brochure that includes prescribed information, including, among other things, implications and risks associated with cannabis use.” It also requires that they evaluate, every five years, whether health warnings on cannabis product labels “reflect the state of the evolving science on cannabis health effects.” 

AB-1448 – Author: Asm. Greg Wallis

This bill requires that, “in an action brought by a county counsel, city attorney, or city prosecutor,” with regard to unregulated cannabis activity, “the penalty first be used to reimburse the prosecuting agency for specified costs in bringing the action, with 50% of the remainder, if any, paid to the county or city, as applicable, and the other 50% to be deposited into the General Fund.”

SB-51 – Author: Sen. Steven Bradford

This bill aims to help equity licensees. It will allow regulators to “issue a provisional license for a local equity applicant for retailer activities if the applicant meets specified requirements;” an earlier version included the word “indefinitely” after “activities.” The bill also calls on regulators “to renew a provisional license for a local equity applicant for retailer activities until it issues or denies the provisional licensee’s annual license, subject to specified requirements, or until 5 years from the date the provisional license was originally issued, whichever is earlier.”

AB-623 – Author: Asm. Phillip Chen

Current law for cannabis edibles “requires the certificate of analysis to report that the milligrams of THC per serving does not exceed 10 milligrams per serving” and that these products do not “deviate from 10 milligrams by more than 10 percent.”

This bill will “require the Department of Cannabis Control to establish regulations to adjust testing variances for edible cannabis products that include less than 5 milligrams of THC in total.”

SB-833 – Author: Sen. Mike McGuire

This bill provides growers with some flexibility and will require regulators to “allow a cultivation licensee to change the type of size of a cultivation license or to place a cultivation license in inactive status.”

AB-993 – Author: Asm. Blanca Rubio

This bill, focused on worker protections, will “expand the task force on regulation of commercial cannabis activity to include representatives from the Civil Rights Department and the Department of Industrial Relations.”

SB-622 – Author: Sen. Benjamin Allen

Current law “requires a unique identifier to be issued for each cannabis plant and to be attached at the base of each plant or as otherwise required by law or regulation.”

This bill allows cannabis regulators to rethink and implement a more efficient way to “require the unique identifier to be recorded.”

SB-753 – Author: Sen. Anna Caballero

This bill will expand current law, under which any adult that grows cannabis in a way that “causes substantial environmental harm to public lands or other public resources” can be charged with a felony, to include “planting, cultivating, harvesting, drying, or processing marijuana that results in substantial environmental harm to surface or groundwater.”

AB-1684 – Author: Asm. Brian Maienschein

This bill, which is focused on local enforcement, will “expand the authorization for an ordinance providing for the immediate imposition of administrative fines or penalties to include all unlicensed commercial cannabis activity, including cultivation, manufacturing, processing, distribution, or retail sale of cannabis and would authorize the ordinance to declare unlicensed commercial cannabis activity a public nuisance,” and would cap fines at “$10,000 per day.” 

It would also “authorize the ordinance to impose the administrative fine or penalty on the property owner and each owner of the occupant business entity engaging in unlicensed commercial cannabis activity and to hold them jointly and severally liable.”

AB-1171 – Author: Asm. Blanca Rubio

The bill allows cannabis licensees to “bring an action in superior court against a person engaging in commercial cannabis activity without a license” as long as they can “demonstrate actual harm resulting from the unlicensed commercial cannabis activity.” 

It would also “authorize a court in that action to enter an order enjoining the defendant from engaging in commercial cannabis activity without a license. The bill would entitle a licensee prevailing in that action to their reasonable attorney’s fees and costs and either actual damages or statutory damages not to exceed $75,000, as specified.” (An earlier version had the monetary cap at $500,000.)