How the 2016 Regula2on and Taxa2on of Marijuana Act Would Work in Arizona Will Humble, MPH 6/7/16 AZPHA ARIZONA PUBLIC HEALTH ASSOCIATION 1
Learning Objec2ves Understand the an>cipated regulatory structure of the Regula>on and Taxa>on of Marijuana Act Learn how the Act would interface with the exis>ng Arizona Medical Marijuana Act Understand how retail marijuana stores would be established and how many could exist Learn what changes would occur within Arizona s Criminal Code for possession of marijuana Become familiar with how the new regulatory program would be funded Be able to explain how revenue would be created by the program, and where excess revenue would be distributed
Important Dates November 2010: AZ Medical Marijuana Act (AMMA) passes April 14, 2011: AZ Department of Health Services launches the program and begins accep>ng applica>ons for qualifying pa>ents and designated caregivers December 6, 2012: First medical marijuana dispensary opens and dispenses November 8, 2016: Arizona Voters Decide fate of the Regula>on and Taxa>on of Marijuana Act
Regulatory Structure The Arizona Department of Marijuana Licenses and Control (ADMLC) and a Marijuana Commission would be created The Agency Director would be appointed by the Governor and can be fired for cause The new Agency must adopt Rules (Administra>ve Code) for the program by September 1, 2017 The new Agency would take over the exis>ng Medical Marijuana program from the Arizona Department of Health Services in September, 2017
Regulatory Structure The Arizona Department of Marijuana Licenses and Control would administer applica>ons for exis>ng Medical Marijuana Dispensaries to become Reorganized Marijuana Businesses (marijuana retail stores) A Medical Marijuana Dispensary and a Reorganized Marijuana Business can (but aren t required to) operate at the same loca>on The Marijuana Commission (within the new Agency) would approve and deny licenses for qualified Reorganized Marijuana Businesses by December 1, 2017. Retail sales could begin on March 1, 2018 The new Agency would consider issuing addi>onal marijuana retailer licenses some>me acer December 1, 2017, with retail sales beginning March 2, 2018
Retail Marijuana Sales the Basics Anybody 21 years old and above could buy marijuana (including extracts and edibles) at retail marijuana stores beginning March 1, 2018 Retail stores would include a 15% surcharge on marijuana sales Medical marijuana pa>ents (including pa>ents under 21) could con>nue buy from medical marijuana dispensaries without the 15% surcharge Medical marijuana dispensaries could be at the same loca>on as the retail marijuana store
Medical Marijuana Dispensaries v. Retail Stores Prices will be lower at medical marijuana dispensaries because there would be no 15% surcharge. Only medical marijuana pa>ents could buy at the less expensive medical marijuana dispensaries Retail sales at stores would be limited to selling 1 ounce (28.3 grams) of marijuana; or a maximum of 5 grams of concentrated marijuana (as an extract, resin or as an extract and resin ingredient in edibles) Medical marijuana pa>ents could con>nue to buy up to 2.5 ounces (70.7 grams) every 2 weeks from medical marijuana dispensaries
Regula2ons for Marijuana Establishments The Arizona Department of Marijuana Licenses and Control would set opera>ng regula>ons for: Licensing, renewal, suspension and revoca>on Standards for working at a marijuana store Physical plant security standards Product tracking procedures Marijuana produc>on standards for cul>va>on Packaging and labeling requirements Marijuana tes>ng standards Marke>ng and display standards Standards for transferring ownership of a store
Cul2va2on License Tiers The Arizona Department of Marijuana Licenses and Control would set cul>va>on regulatory standards for supplying the stores with marijuana At least 3 cul>va>on >ers would exist: Unlimited Produc>on Mid- volume Produc>on Low- volume produc>on Re- organized medical marijuana businesses would qualify for the unlimited produc>on >er
Number of Stores/Dispensaries As of June, 2016, the Arizona Department of Health Services had 99 licensed or cer>fied medical marijuana dispensaries Approximately 30 addi>onal cer>ficates expected in the Summer of 2016, bringing the total to about 120 Each Dispensary could re- organize as a Reorganized Marijuana Business, or retail store between September 1 and December 1, 2017. Retail sales could begin March 1, 2018 By early 2018 the number of Reorganized Marijuana Businesses (retail stores) would be a subset of the approximately 120 medical marijuana dispensaries
Number of Stores/Dispensaries In late 2017, the Arizona Department of Marijuana Licenses and Control could begin issuing addi>onal Marijuana Retailer licenses New licenses limited to 10% of the number of Series 9 liquor licenses Current limit would be 147 Marijuana Retailers Acer 2021, the Agency could issue addi>onal retailer licenses as needed
Marijuana Store Loca2ons Ci>es, towns and other poli>cal jurisdic>ons can establish reasonable zoning standards for marijuana stores as long as the standards are consistent with the Act Ci>es, towns and other poli>cal jurisdic>ons may prohibit the licensing of new marijuana retailers and cul>va>on facili>es, except that: The ordinance must be enacted by a referendum or ini>a>ve on a general elec>on ballot; and The ordinance can t prohibit a zoning applica>on for a reorganized medical marijuana dispensary to become a retail store
Stopgap Measures If the Arizona Department of Marijuana Licenses and Control doesn t implement the law by September 1, 2018, exis>ng medical marijuana dispensaries transi>on to a Reorganized Marijuana Business (retail store) without Agency approval Locali>es could then license and regulate the Reorganized Marijuana Businesses (retailers) If the new Agency doesn t implement the law, applicants can file a Mandamus ac>on in Superior Court to compel ac>on
Current Marijuana Possession Laws Currently, any possession of marijuana by a non- medical marijuana cardholder is a felony, even 1 marijuana cigarele Only qualified Medical Marijuana Pa>ents are currently protected from prosecu>on for possession. Qualified medical marijuana pa>ents can legally possess up to 2.5 ounces (70.7 grams) of marijuana, or 12 plants if they are authorized to cul>vate Qualified medical marijuana caregivers can possess more than 2.5 ounces (up to 2.5 oz per pa>ent- limit 5 pa>ents)
Marijuana Laws, if Ini2a2ve Passes Anyone 21 or older could legally possess up to 1 ounce of marijuana; or a maximum of 5 grams of concentrated marijuana (as an extract, resin or as an extract and resin ingredient in edibles) Anyone 21 and older would be able to grow up to 6 of their own marijuana plants as long as they meet security standards, limit 12 per household Anyone under 21 possessing less than 1 ounce of marijuana (or less than 5 grams of concentrate) could be charged with a pely offense punishable by a fine of $300 and 24 hours of community res>tu>on Anyone (21 or older) who sells or gives any marijuana to a non- medical marijuana cardholder under 21 could be charged with a pely offense punishable by a fine of $300
Marijuana Laws, if Ini2a2ve Passes Anyone 21 or older who isn t a dispensary agent or establishment employee or a medical marijuana caregiver with mul>ple pa>ents, who possesses more than 2.5 ounces of marijuana would s>ll be subject to a felony Anyone under 21 who is not a medical marijuana cardholder that possesses more than 1 ounce of marijuana (or more than 5 grams of concentrate or concentrate in edibles) would s>ll be subject to a felony charge Anyone 21 and older who possess more than 1 ounce but less than 2.5 ounces could be charged with a pely offense and fined up to $300 (exemp>ons for medical marijuana pa>ents)
Marijuana Laws, if Ini2a2ve Passes Any medical marijuana qualified pa>ent, caregiver, or dispensary agent ac>ng within the scope of the Arizona Medical Marijuana Act would con>nue to enjoy the Act s protec>ons The law would not change penal>es for opera>ng a motor vehicle or machinery while impaired by marijuana Any landlord or land owner could prohibit smoking or growing marijuana Workplace prohibi>ons regarding impairment or use would remain unchanged Possessing or using marijuana on school grounds and other prohibited areas is unchanged
Regulatory Funding Sources The Arizona Department of Marijuana Licenses and Control would ini>ally be funded by the Arizona Medical Marijuana Fund (currently contains more than $12M) Acer covering ini>al expenses, the Department of Marijuana Licenses and Control would return unused funds to the Arizona Medical Marijuana Fund (which would reside within the same agency) to con>nue opera>ng the medical marijuana program No state general funds would be used for the program, including costs for collec>ng tax revenue
Tax Revenue The law would create the Marijuana Fund funded by the 15% surcharge tax on all marijuana sold at Marijuana Establishments The Tax Founda>on es>mates $113 million in new tax revenue per year to the Marijuana Fund. Excess revenue would be distributed as follows: 40% to school districts and charter schools for things like teachers salaries, opera>ons costs for K- 12 educa>on 40% to school districts and charter schools for full day Kindergarten 20% to the Arizona Department of Health Services, who would distribute the funds to AZ Poison Control Centers for public educa>on regarding the harms of alcohol, marijuana and other substances
Summary The Arizona Department of Marijuana Licenses and Control would be created if Regula>on and Taxa>on of Marijuana Act passes The Agency Director would be appointed by the Governor along with a 7- member Marijuana Commission The new Agency would take over the exis>ng Medical Marijuana program from the Arizona Department of Health Services in September 2017 Exis>ng medical marijuana dispensaries could transi>on into marijuana retail stores, with a maximum of about 147 stores statewide for the first few years
Summary Anybody 21 years old and above could buy marijuana at the retail stores (beginning March 1, 2018) Medical marijuana dispensaries could co- exist with retail marijuana stores Prices will be lower at medical marijuana dispensaries because of the lack of the 15% surcharge tax. Only medical marijuana pa>ents could buy at the less expensive medical marijuana dispensaries
Summary Currently, any possession of marijuana by a non- medical marijuana cardholder is a felony, even 1 marijuana cigarele If the Act is passes, anyone 21 or older could legally possess up to 1 ounce of marijuana; or up to 5 grams of concentrated marijuana (as an extract, resin or as an extract and resin ingredient in edibles) and grow up to 6 of their own plants Possession of more than 2.5 ounces by anyone 21 or older (who isn t a dispensary agent or establishment employee or a medical marijuana caregiver) would s>ll be a felony Possession of more than 1 ounce of marijuana; or 5 grams of concentrate as an extract, resin or as an extract and resin ingredient in edibles by anyone under 21 (who is not a medical marijuana cardholder) would s>ll be a felony
Summary The law would not change penal>es for opera>ng a motor vehicle or machinery while impaired by marijuana Workplace prohibi>ons regarding impairment or use would remain unchanged The law would create the Marijuana Fund funded by the 15% surcharge tax on all marijuana sold at Marijuana Establishments. The Tax Founda>on es>mates $113 million in new tax revenue per year. Excess revenue would be distributed as follows: 40% to school districts and charter schools 40% for full- day Kindergarten 20% for public educa>on regarding the harms of alcohol, marijuana and other substances