SUBJECT MATTER OF PROPOSED REGULATIONS:  Medicinal and Adult-Use Cannabis Regulation Application Process Requirements.

SECTIONS AFFECTED: Title 16, California Code of Regulations, sections 5002, 5017, 5021 and 5600.

Notice is hereby given that the Bureau of Cannabis Control (Bureau) proposes to undertake the proposed amended laws, described beneath, after contemplating all feedback, objections, and proposals relating to the proposed motion. The Bureau, upon its personal movement or on the request of any celebration, could thereafter undertake the proposals considerably as described beneath, or could modify such proposals if such modifications are sufficiently associated to the unique textual content. With the exception of technical or grammatical adjustments, the complete textual content of any modified proposal can be obtainable for inspection and copying 15 days previous to its adoption from the particular person designated on this Notice as contact particular person and can be mailed to these individuals who submit written or oral testimony associated to this proposal or who’ve requested notification of any adjustments to the proposal.

All of the proposed textual content sections and paperwork integrated by reference are proposed to be added to the California Code of Regulations (CCR), below Division 42 of Title 16.

PUBLIC HEARING

The Bureau has not scheduled a public listening to on this proposed motion. However, the Bureau will maintain a listening to if it receives a written request for a public listening to from any particular person, or his or her licensed consultant, no later than 15 days earlier than the shut of the written remark interval.

WRITTEN COMMENT PERIOD

Any particular person, or his or her licensed consultant, could submit written feedback related to the proposed regulatory motion to the Bureau. Written feedback, together with these despatched by mail or e-mail to the addresses listed beneath. Comments submitted by e-mail should be obtained by the Bureau at its workplace by 5:00 p.m. on December 1, 2020.

Submit feedback to:

Kaila Fayne

Bureau of Cannabis Control

2920 Kilgore Road

Rancho Cordova, CA 95670

E-mail: BCC.feedback@dca.ca.gov

AUTHORITY AND REFERENCE

Business and Professions Code (BPC) part 26013 authorizes the Bureau to undertake laws for the licensing of economic hashish exercise. Assembly Bill 2138 (Chiu, Chapter 995, Statutes of 2018) (AB 2138) added, repealed or amended BPC sections 7.5, 480, 480.2, 481, 482, 488, 493, and 11345.2. These amendments to the statutory sections altered the license utility necessities for bureaus below the Department of Consumer Affairs (DCA).

The proposed laws implement the statutory adjustments from AB 2138 into the Bureau’s license utility and renewal processes; particularly amending 16 CCR sections 5002, 5017, 5021, and 5600. The provisions inside AB 2138 develop into operative on July 1, 2020.

INFORMATIVE DIGEST/ POLICY STATEMENT OVERVIEW

The Bureau is a regulatory company below the DCA and is charged with licensing sure varieties of business hashish companies. On September 30, 2018, AB 2138 was signed by the Governor, with the intent of eradicating a few of the licensing and employment limitations that these with prior legal convictions or disciplinary actions usually encounter if they will exhibit rehabilitation. AB 2138 amended the language of sections of the BPC referring to the license utility course of for bureaus throughout the DCA.

Most notably, the adjustments to the statutes prohibit bureaus from requiring candidates for licensure to reveal info or documentation relating to the applicant’s legal historical past. Additionally, if a bureau decides to disclaim an applicant for licensure, the bureau should present the applicant with discover of the denial, together with the rationale for the denial, in addition to directions for interesting the choice and the method for receiving a duplicate of the applicant’s conviction historical past.

AB 2138 additionally amends BPC part 480 to ban a bureau from denying a license to candidates primarily based on a legal conviction or the acts underlying a conviction if the applicant makes a displaying of rehabilitation. The amendments to BPC part 482 require bureaus to think about, when figuring out whether or not to disclaim, droop, or revoke a license, whether or not an applicant or licensee has made a displaying of rehabilitation, if the particular person has both accomplished the legal sentence and not using a parole or probation violation, or if the particular person is rehabilitated primarily based on the bureau’s rehabilitation standards.

BPC part 480 has additionally been amended to permit a bureau to disclaim a license, in related half, on the grounds the applicant was convicted of against the law or has been topic to formal self-discipline if:

  1. The conviction was up to now seven years and is considerably associated to the {qualifications}, capabilities, or duties of the enterprise or occupation; or
  2. The conviction is considerably associated to the {qualifications}, capabilities, or duties of the enterprise or occupation and was for a severe felony, as outlined in Penal Code part 1192.7, and sure specified intercourse offenses, even when the conviction occurred greater than seven years in the past; or
  3. The applicant is presently incarcerated or was launched from incarceration throughout the final seven years for against the law that’s considerably associated to the {qualifications}, capabilities, or duties of the enterprise or occupation; or
  4. The applicant was launched from incarceration greater than seven years in the past for against the law that’s considerably associated to the {qualifications}, capabilities, or duties of the enterprise or occupation and the conviction was for a severe felony, as outlined in Penal Code part 1192.7, and sure specified intercourse offenses; or
  5. The applicant has been topic to formal self-discipline by a licensing board or bureau in or exterior of California throughout the previous seven years primarily based on considerably associated skilled misconduct.

Further, AB 2138 amended BPC part 481 to incorporate extra particular standards that bureaus should use to find out whether or not against the law is considerably associated to the {qualifications}, capabilities, or duties of the occupation.

The Bureau’s present substantial relationship standards, in addition to its standards for figuring out rehabilitation when contemplating denying, suspending, or revoking a license, are already in part 5017 of the Bureau’s laws (see 16 CCR 5017). This part must be amended to satisfy the necessities of AB 2138, in addition to some other sections set forth on this Notice. In addition, vital technical amendments are included in these laws to make sure consistency with the statute.

The proposed laws implement new necessities imposed by AB 2138 to the Bureau’s license utility course of. The Bureau has decided that amending the laws is required to make sure compliance with the statutory adjustments.

Incorporated by Reference

There are not any paperwork integrated by reference.

Anticipated Benefit of the Proposed Regulations:

AB 2138 was enacted to cut back licensing and employment limitations for people who find themselves rehabilitated. These proposed amendments additional that objective by adopting standards that emphasize an applicant’s or licensee’s rehabilitative efforts and what’s wanted to make a displaying of rehabilitation.

The proposed laws will amend the Bureau’s license utility course of to adjust to adjustments to the BPC. The proposed amendments can even place candidates and licensees on discover that the Bureau is statutorily licensed to disclaim, droop, or revoke a license due to skilled misconduct and self-discipline taken by one other licensing board, bureau, or jurisdiction. The proposal additionally makes related events (e.g., Deputy Attorneys General, Administrative Law Judges, respondents, and respondents’ authorized counsel) conscious that, when contemplating denial or self-discipline of candidates or licensees, the Bureau makes use of the listed standards to find out whether or not the crime, act, or skilled misconduct is considerably associated to the California hashish trade.

Evaluation of Inconsistency/Incompatibility with Existing State Regulations:

After conducting an analysis, the Bureau has decided that the Bureau’s laws are the one laws in regards to the utility necessities for business hashish licenses issued by the Bureau. Therefore, the Bureau has decided that these proposed laws usually are not inconsistent or incompatible with current state laws.

Evaluation of Inconsistency/Incompatibility with Existing Federal Regulations:

There are at present no federal laws relating to the licensing course of for business hashish companies inside California.

DISCLOSURES REGARDING THE PROPOSED ACTION

The Bureau has made the next preliminary determinations:

Mandate on native businesses and college district: None.

Cost or financial savings to any state company: The Bureau anticipates elevated prices to the state because of adopting and amending the sections recognized within the regulatory proposal. Any workload and prices are anticipated to be minor and absorbable inside current assets.

Cost to any native company or college district which should be reimbursed in accordance with Government Code sections 17500, et. seq.: None.

Other non-discretionary price or financial savings imposed on native businesses: None.

Cost or financial savings in federal funding to the state: None.

Cost impacts on a consultant non-public particular person or enterprise: The Bureau will not be conscious of any price impacts {that a} consultant non-public particular person or enterprise would essentially incur in cheap compliance with the proposed motion.

Significant impact on housing prices: None.

Small Business Determination: The Bureau has decided that the proposed laws could have no impact on small companies. A big variety of Bureau licensees are small companies. The proposed laws lead to minor adjustments to the Bureau’s license utility course of. However, the proposed laws are unlikely to have an effect on the willpower of which candidates qualify for a license from the Bureau.

Significant, statewide opposed financial impression immediately affecting companies, together with the flexibility of California companies to compete with companies in different states:

The proposed regulation won’t have a big opposed financial impression on companies or people because the laws don’t adversely impression all hashish companies. This preliminary willpower is as a result of this regulation is predicated on the necessities of AB 2138.  The function of AB 2138 is to cut back limitations for licensure for candidates and licensees with legal histories or license self-discipline if they will exhibit proof of rehabilitation; it doesn’t impose extra rigorous necessities on the licensure course of.  The invoice and corresponding laws won’t remove companies and will presumably result in people being certified to develop into house owners of a license.

Results of the Economic Impact Assessment

The Bureau doesn’t anticipate the creation or elimination of jobs or companies, or the growth of current companies, because of the proposal. The Bureau will proceed to obtain legal historical past info relating to convictions as offered for by statute. The Bureau anticipates that candidates and licensees with convictions will voluntarily present rehabilitation info to the Bureau to make sure all features of the particular person’s rehabilitation might be correctly thought-about by the Bureau in its analysis. Currently, the Bureau can solely subject or self-discipline a license if an applicant proprietor or licensee’s conviction is considerably associated to the {qualifications}, capabilities, and duties of the license. Additionally, the regulation for hashish licenses solely requires individuals with a sure degree of possession or operational accountability to be topic to analysis of legal historical past info. Thus, the Bureau doesn’t anticipate the proposal will result in an general enhance within the creation of jobs or licensed companies, or the growth of companies at present doing enterprise in California.

This regulatory proposal advantages the well being and welfare of California residents as a result of it won’t remove companies and the Bureau will have the ability to proceed to think about components of rehabilitation in evaluating suitability for licensure.

This regulatory proposal doesn’t have an effect on employee security as a result of it seeks to extend the flexibility of some people to acquire a Bureau license with previous convictions or self-discipline in the event that they meet sure standards and present proof of rehabilitation.  It doesn’t require the Bureau to subject a license to these with latest considerably associated convictions or severe felony convictions.

This regulatory proposal doesn’t profit or negatively impression the State’s setting as a result of the proposed regulatory motion doesn’t contain any matter that induces hurt or profit to the setting within the State.

CONSIDERATION OF ALTERNATIVES

In accordance with Government Code part 11346.5, subdivision (a)(13), the Bureau should decide that no cheap different it thought-about or that has in any other case been recognized and delivered to the eye of the company could be more practical in finishing up the aim for which the motion is proposed, or could be as efficient and fewer burdensome to affected non-public individuals than the proposed motion, or could be more cost effective to affected non-public individuals than the proposed motion, or could be more cost effective to affected non-public individuals and equally efficient in implementing the statutory coverage or different provision of regulation.

Set forth beneath are the options which have been thought-about and the explanations every different was rejected:

  1. Option 1: Pursue a regulatory change that requires the Bureau to seek out rehabilitation if the applicant or licensee accomplished the phrases of their legal probation or parole. This different was rejected as a result of the Bureau believes that reviewing every particular person’s conviction and rehabilitation info using a number of standards higher signifies rehabilitation and ensures no hazard to the general public’s well being, security, and welfare.
  2. Option 2: Not undertake the laws. This different was rejected as a result of AB 2138 requires the Bureau to make amendments to its laws to implement its provisions for its implementation.

CONTACT PERSON

Inquiries in regards to the proposed administrative motion could also be directed to:

Kaila Fayne

Bureau of Cannabis Control

2920 Kilgore Road

Rancho Cordova, CA 95670

916-465-9025

BCC.feedback@dca.ca.gov

The backup contact particular person for these inquiries is:

Paul Atienza

Bureau of Cannabis Control

2920 Kilgore Road

Rancho Cordova, CA 95670

916-465-9029

Paul.Atienza@dca.ca.gov

Please direct requests for copies of the proposed textual content (the “express terms”) of the laws, the preliminary assertion of causes, the modified textual content of the laws, if any, or different info upon which the rulemaking is predicated to the contact individuals listed above.

AVAILABILITY OF STATEMENT OF REASONS, TEXT OF PROPOSED REGULATIONS, AND RULEMAKING FILE

The Bureau could have all the rulemaking file obtainable for inspection and copying, all through the rulemaking course of, at its workplace on the handle above. As of the date this discover is revealed within the Notice Register, the rulemaking file consists of this discover, the proposed textual content of the laws, and the Initial Statement of Reasons. Copies of supplies could also be obtained by contacting Kaila Fayne on the handle or telephone quantity listed above.

AVAILABILITY OF CHANGED OR MODIFIED TEXT

After contemplating all well timed and related feedback obtained, the Bureau could undertake the proposed laws considerably as described on this discover. If the Bureau makes modifications which are sufficiently associated to the initially proposed textual content, it would make the modified textual content (with the adjustments clearly indicated) obtainable to the general public for at the least 15 days earlier than the Bureau adopts the laws as revised. Please ship requests for copies of any modified laws to the eye of Kaila Fayne on the handle or telephone quantity indicated above.

The Bureau will settle for written feedback on the modified laws for at the least 15 days after the date on which they’re made obtainable.

AVAILABILITY OF THE FINAL STATEMENT OF REASONS

Upon its completion, copies of the Final Statement of Reasons could also be obtained by contacting Kaila Fayne on the above handle.

AVAILABILITY OF DOCUMENTS ON THE INTERNET

Copies of the Notice of Proposed Action, the Initial Statement or Reasons, and the textual content of the laws might be accessed by way of the Bureau’s web site at: https://bcc.ca.gov/law_regs/cannabis_regs.html.

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