Marijuana Legalization Implementation Committee
LD 1719 – work session
Accepted in Ought to Pass as Amended Vote on February 23, 2018
*Indicates changes made to proposal when vote was taken
- Proposal to prohibit entry of persons under 21 from all areas within a marijuana establishment;
*Add clarification that qualifying patient aged 18, 19 or 20 may enter a common area within a shared facility to access where medical marijuana is sold.
- Proposal to clarify municipal “opt-in” language to provide that municipal action may include passage of a new ordinance, amendment of existing ordinance or approval of a warrant article that generally regulates operation of marijuana establishments within municipality;
*Existing ordinances are valid and decisions such as land-use ordinances applicable to adult-use marijuana endorsed by legislative body qualify as an “opt-in.”
- Proposal to include language similar to 28-B MRSA §606 (LD 1719, p. 49) regarding coordination of medical and adult use rules on packaging and labeling;
- Proposal to provide exemptions from application of certain Criminal Code (Title 17-A) provisions for activities authorized under MLA (consistent with existing exemptions for activities authorized under medical law).
- Proposal to include unallocated language directing Marijuana Advisory Commission to include in its first report recommendations regarding standardization, coordination or integration of medical and adult use programs, including testing, labeling and packaging standards and rules.
*Change to make this an ongoing duty of the Commission rather than one-time report.
- Proposal to apply certain packaging and labeling standards relating to appeal to children (shapes, depictions, etc.) to advertising standards. See pink sheet of language, page 3, amending 28-B, section 702, sub-§1, ¶B.
- Change definition of “plant canopy” to include only those areas in which mature marijuana plants are cultivated. (See gold sheet language dated Jan. 30)
- Revise license tier sizes to: Tier 1, up to 30 plants or up to 500 sq ft; Tier 2, up to 2000 sq ft; Tier 3, up to 7000 sq ft; and Tier 4, up to 20,000 sq ft, with increases available upon renewal of 7000 sq ft no more than once per 2 years. No change in application fee or license fee.
- Health and safety warning labels on packaging of retail marijuana and marijuana products. Mandate health and safety warnings labels on retail marijuana and marijuana products as required by major substantive rule adopted by DAFS in consultation with DHHS Center for Disease Control and Prevention. Sec. 701(1), pg 50.
- Remove section 202(3), pg 15, on durational residency requirement. Add a definition of resident to sec. 102: person domiciled in the state; with permanent place of abode in state; spends more than 183 days of taxable year in state; and has filed resident tax return in each of the 3 years prior to the year in which the applicant applies for licensure. Repeal on June 1, 2012 the tax return filing portion of the definition.
- Sampling of marijuana. Sec. 502(5), p 35. Sampling on premises by employees of products manufacturing facility allowed for quality purposes and research and development only, may be done on premises, but may not involve smoking. Smoking defined as in 22 MRSA 1541(6).
- Retain current bill provisions on co-location of adult use cultivation and products manufacturing facilities and medical marijuana cultivation and processing space (pgs. 32-33, 35). Require complete separation of marijuana stores and storefronts for medical marijuana caregivers and dispensaries (separate facilities; separate buildings).
- Proposal relating to local control/approval within unorganized territory – see proposal distributed 2/16.
- Proposal relating to employment practices (§112 of bill, pgs. 12-13) – see language from 2/16.
- Proposal relating to organic labeling – see language distributed 2/16.
- Reduce number of marijuana plants authorized for personal possession and home cultivation to 3 mature plants, 12 immature plants and unlimited seedlings.
* Provide for 6 month delayed effect of reduction from 6 to 3 mature plants.
- All provisions regarding personal possession and home cultivation will still only apply to adult use marijuana (i.e., not applicable to medical marijuana).
- Person may cultivate 3 mature plants, 12 immature plants and unlimited seedlings:
- On land on which the person is domiciled;
- On other land the person owns; or
- On other land owned by another person with a written agreement regarding the cultivation/care of the plants.
- Municipality may adopt an ordinance or other regulation that sets limits on home cultivation of marijuana on a parcel/tract of land as long as that limit allows for the cultivation of 3 mature plants, 12 immature plants and unlimited seedlings for each person 21 years or older who is domiciled on the parcel/tract of land.
- Provisions regarding home cultivation requirements (§1502(3) on pgs. 61-62) still apply as written.
- All licensing, administration, enforcement and other oversight under MLA under DAFS.
- All rulemaking authority under MLA under DAFS, but DAFS required to consult with DACF in adopting rules under the MLA relating to cultivation, processing, testing, etc. (in same manner as the required consultation with DOL and DPS on pg. 10 of bill).
- Amend Marijuana Advisory Commission membership to following 15 members:
- Representatives from DAFS, DHHS, DPS, DOL and *DACF;
- *A representative of a statewide prosecutors association;
- A public health expert;
- Representatives from medical marijuana and adult use marijuana industries;
- Two members of the general public; and
- Two members of the Senate and two members of the House.
- Shift oversight of medical law and administration of medical marijuana program from DHHS to DAFS.
- Medical law will remain in Title 22 and will not change other than references to DHHS; medical program rules and active registrations will remain in effect and valid.
- Will include provisions aimed at ensuring HHS Committee retains jurisdiction over medical marijuana issues.
- Will include provisions to ensure that administration and oversight of medical program within DAFS does not involve administration and oversight by BABLO.
- Will include provisions to ensure that rulemaking under medical law by DAFS requires consultation with DHHS.
- Remove all municipal revenue sharing provisions from bill.
- Do not include new language on municipal impact fees.
- On revenue sharing, delete section 1002, subsection 2 and amend subsection 1; delete section 1003 subsection 2 and amend subsection 1.
- Retain specific tax revenue dedications to Adult Use Marijuana Public Health and Safety Fund in bill (p. 58-59). All other tax revenue goes directly to General Fund.
- Include provisions to allow for limited plant sales between dispensaries/registered caregivers and adult use cultivators who are also dispensaries or registered caregivers.
- Sale of plants and seeds only (no harvested/processed marijuana, marijuana concentrate or marijuana products).
- Sale is a taxable event on which applicable excise tax under MLA must be collected.
- For a two year period starting on the date that DAFS issues the first “active” cultivation facility license (DAFS to post notice of this start date), the initial active license provided to an adult use cultivator that is also a dispensary or registered caregiver must provide authorization for the cultivator to purchase plants and seeds from a dispensary or registered caregiver in a single sales transaction only.
- The authorization is limited to the term of the initial active license (one year) and the adult use cultivator is limited to a one-time purchase of plants and seeds from a dispensary or registered caregiver (i.e., cannot purchase from multiple dispensaries or caregivers and cannot purchase in multiple transactions from a single dispensary or caregiver).
- A dispensary or registered caregiver may only sell plants and seeds to one adult use cultivator in a single transaction (i.e., cannot sell to multiple cultivators or in multiple transactions to a single cultivator).
- DAFS to adopt rules governing this limited sales period.
- Remove all reference to social club operation, licensing and related provisions from bill.
- Strike second paragraph from 110 (pg. 12, lines 20-22).
- Strike second and third sentences from §104(3) (pg. 9, lines 19-26).
- Strike §402(6) in its entirety (pg. 30, lines 19-34).
- Add to the duties of the Marijuana Advisory Commission in §903 (pg. 56-57) language requiring the annual solicitation of public comment regarding police contacts with citizens involving the personal use of marijuana and marijuana products and home cultivation of marijuana and to include any resulting findings and recommendations in its annual report.
27. Tax structure and rates (sales tax and excise tax) Sec. 1001, pg. 57 and Part D, pg. 66.
- Accepted proposal from DAFS/MRS to achieve 20% effective total tax rate that includes a 10% sales tax at the point of sale to a consumer and an excise tax imposed on wholesale sales by a licensed cultivator to another adult use marijuana licensee.
|Taxable Item||LD 1650/1719||DAFS/MRS Proposal|
|Marijuana flower and mature plants||$130/pound||$335/pound|
|Immature plant or seedling||$1.50/plant or seedling||$1.50/plant or seedling|
The outcome is essentially a 21.5 percent excise tax at wholesale on marijuana products. When combined with the 10 percent sales tax, this proposal is revenue neutral to the 20 percent sales tax previously proposed. Preliminary revenue estimates are as follows:
|Tax Type||Fiscal Year 2020||Fiscal Year 2021|
|Sales (retail)||$1.4 million||$8.5 million|
|Excise (wholesale)||$1.3 million||$7.8 million|
|Total||$2.7 million||$16.3 million|
28. Delete sections A-8 and A-9 that would have imposed a deadline of December 1, 2018 on provisional adoption of major substantive rules.
Withdrawn or voted “out”
- Reexamine testing provisions to improve efficiency of testing process. Withdrawn by Rep. Ackley.
- State tax deductions for marijuana businesses. Withdrawn by Sen. Dion.
- Employment of persons age 18, 19 or 20 at an adult use marijuana facility/establishment. Withdrawn by Rep. Hickman.
- Proposal to limit possession of marijuana cultivated for personal use under MLA to 8 pounds (mirror medical marijuana law limitation). Withdrawn by Rep. Hickman.
- Environmental issues, particularly waste and burden or impacts on natural resources. Withdrawn by Rep. Hickman.
- Proposal to expand requirements on labeling, packaging and signs, advertising and marketing. Withdrawn by Rep Hanley.