SB 762 Allows a person to possess up to one ounce of marijuana and provides a licensure process for retail marijuana stores, cultivation facilities, and products manufacturers
Sponsor: Chappelle-Nadal
LR Number: 5007S.01I Fiscal Notes
Committee: Judiciary and Civil and Criminal Jurisprudence
Last Action: 1/11/2016 - Second Read and Referred S Judiciary and Civil and Criminal Jurisprudence Committee Journal Page: S99
Title: Calendar Position:
Effective Date: August 28, 2016

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Current Bill Summary


SB 762 - This act allows a person to possess up to one ounce of marijuana and provides a licensure process for retail marijuana stores, retail marijuana cultivation facilities, retail marijuana products manufacturers, and retail marijuana testing facilities. Licensees may possess, manufacture, and distribute marijuana in accordance with the provisions of the act and rules promulgated by the Division of Alcohol and Tobacco Control.

Retail marijuana is subject to a sales tax of 12.9 percent.

In addition, separation gins and sifters used to remove twigs and seeds from marijuana and objects designed for use in inhaling marijuana are removed from the definition of drug paraphernalia.

Each licensee under the act must have a local license from the municipality or county and a state license from the Division of Alcohol and Tobacco Control to engage in the activities allowed under the act. The licenses are valid for two years.

This act gives the Division of Alcohol and Tobacco rulemaking authority and requires the division to promulgate certain rules regarding retail marijuana.

Applicants for a local license must file plans and specifications for the interior of the building or a plot plan and a detailed sketch if the building does not exist yet. The licensing authority must hold public hearings on such licenses. This act provides requirements for those hearings. A local licensing authority or applicant for a local license may ask the division to conduct a concurrent review of the license application.

The local licensing authority may refuse to issue a license for good cause, subject to judicial review. This act specifies factors the local licensing authority may consider before issuing a decision on an application. The decision must be issued within 30 days after the public hearing or completion of the application investigation. After approval, a license may not be issued until the building is ready for occupancy, is equipped with the materials needed to comply with the act, and has been inspected by the local licensing authority. The local licensing authority must notify the state licensing authority of approvals.

This act specifies requirements for applicants of a state license and instances in which the division may deny an application for state licensure. A hearing before the Administrative Hearing Commission must be provided to applicants who have been denied. The division must complete a fingerprint-based criminal background check on applicants.

This act prohibits the division and the local licensing authority from issuing a license if the location is the same as or within 1,000 feet of a location that has previously been denied, it has not been established if the applicant is entitled to possession of the premises, if the location is in an area not zoned for such activities, or if the building in which retail marijuana is to be sold is within 1,000 feet of a school, an alcohol or drug treatment facility, college or seminary campus, or a residential child care facility.

Counties and municipalities may enact reasonable regulations or restrictions on retail marijuana licenses based on zoning, health, safety, and public welfare laws.

This act requires licensees to provide the division with certain information regarding owners, officers, and employees of the licensee, and anyone with a direct or indirect financial interests in the licensee, including fingerprints for criminal background checks. In addition, this act places limitations on licensees in regard to transfers of ownership and management and movement of locations.

The division must notify the licensee of the expiration date ninety days prior to the expiration of the license. If the licensee has had complaints filed against it or a history of violations, the local licensing authority may hold a hearing on a license renewal. This act provides requirements for licensees to renew their licenses. A license may be revoked or not renewed if it is determined that the licensed premises have been inactive without good cause for a year.

The licensees must collect sales tax on all sales made under the licensed activities.

This act allows state-chartered banks and credit unions to loan money for the operation of a licensed business.

Labeling and packaging, testing, storage, and processing requirements for retail marijuana and marijuana-infused products are provided under this act. This act prohibits certain relationships between testing laboratories and licensees. Also provided are requirements for the sanitation and cleanliness of the facilities.

This act creates the Retail Marijuana License Cash Fund, which consists of all money collected by the division under this act. It is a dedicated fund to be used for the administration of the act.

Applicants for a retail marijuana store license must pay a fee of $500 for each license, and applicants for a cultivation facility or products manufacturer license must pay $2,500 for each license. The division sets the fees for licenses renewals, applications to change location or transfer ownership, and testing facility licenses, but such fees must reflect the actual costs to the division in the administration and enforcement of the program. In addition, the division must establish a fee to be paid at the time of service of any subpoena upon the division plus a fee for meals and miles for state officers and employees acting in response to a subpoena. The local licensing authorities may establish licensing fees that do not exceed 10 percent of the state's fee.

This act provides procedures for sanctions against licensees, including revocation and suspension. The procedures require notice and an opportunity for a hearing. Requirements for record-keeping and procedures for auditing and inspecting the licensees are also provided. Under this act, the division may summarily suspend a license pending further proceedings to protect the public health, safety, or welfare.

This act creates several Class A misdemeanors relating to retail marijuana.

This act is substantially similar to SB 560 (2015).

MEGHAN LUECKE