Already in 2022, Gov. Gavin Newsom’s signature has ushered in significant change for California’s cannabis industry. And that’s before another dozen bills head to his desk as the legislative session ends.
The session began in January with a clear priority: tax reform. Amid more than a dozen bills introduced were a handful of proposals focused explicitly on taxes, from eliminating the cultivation tax to reducing the excise tax, as Cannabis Wire reported. Then, in May came Newsom’s own proposal, by budget, followed by a compromise with lawmakers in June, and by July it was law.
Where did the tax reform ultimately land? The cultivation tax is now zero. The excise tax rate is locked in at 15% for three years, but can be adjusted up to 19% to make up for lost cultivation tax revenue.
Now, with the legislative session wrapping up on August 31, the question is which of the cannabis bills headed to Newsom’s desk will he sign? He has until the end of September to decide.
Here’s a breakdown of the bills that made it – and the noteworthy ones that didn’t:
Bills headed to Newsom’s desk:
SB 1326 (Sponsor: Sen. Anna Caballero): This bill is perhaps the most-watched of the legislative session and is focused on interstate commerce of cannabis. Today, as cannabis is federally illegal, all cannabis produced in a legal state must stay within that state.
The bill suggests a framework for what interstate commerce could look like in a multistate cannabis market.
It would “authorize the Governor to enter into an agreement with another state or states authorizing medicinal or adult-use commercial cannabis activity, or both, between entities licensed under the laws of the other state or states and entities operating with a state license pursuant to [the Medicinal and Adult Use Cannabis Regulation and Safety Act], provided that the commercial cannabis activities are lawful and subject to licensure under the laws of the other state or states.”
“This bill is the tool needed for the Governor to start having conversations with other states around a viable option to pursue interstate commerce,” Caballero told Cannabis Wire this summer, adding that her bill “can be the catalyst to move the needle on interstate commerce,” and that, if it passes, she will be “ready to initiate conversations with my counterparts in others states to explore potential partners.”
AB 2188 (Sponsor: Assembly member Bill Quirk): This bill will “make it unlawful for an employer to discriminate against a person in hiring, termination, or any term or condition of employment, or otherwise penalize a person, if the discrimination is based upon the person’s use of cannabis off the job and away from the workplace.” This does not “apply to employees in the building and construction trades” or “preempt state or federal laws requiring employees to be tested for controlled substances.”
AB 1885 (Sponsor: Assembly member Ash Kalra): This bill prevents a “veterinarian who recommends the use of cannabis on an animal for potential therapeutic effect or health supplementation purposes” from being disciplined. It will provide guidelines for vets and requires regulations for “products intended for animals.” And, its definition of “animal” does not include “livestock” or “a food animal.”
“With the passage of AB 1885, we have taken a major step toward making safe, clearly labeled animal cannabis products available to pet owners who would otherwise have to give their pets cannabis products meant for human-use—or turn to the illegal market,” Assemblymember Kalra told Cannabis Wire. “It is time to allow veterinarians to recommend safe, regulated cannabis products for their animal patients so that our pets can live healthier and more comfortable lives.”
AB 1706 (Sponsor: Assembly member Mia Bonta): The state’s adult use law set a deadline of July 1, 2020 for cannabis sentences to be reviewed for eligibility for dismissal; however, that did not happen.
This bill requires, for any cannabis sentence that did not see its eligibility challenged by that date, “the court to issue an order recalling or dismissing the sentence, dismissing and sealing, or redesignating the conviction no later than March 1, 2023, and would require the court to update its records accordingly and to notify the Department of Justice. The bill would require the Department of Justice, on or before July 1, 2023, to complete the update of the state summary criminal history information database, and ensure that inaccurate state summary criminal history is not reported, as specified.”
“AB 1706 fulfills a promise made to Californians in 2016 when voters approved Proposition 64 and legalized cannabis. That promise was that we would reduce, dismiss and seal prior cannabis convictions. There is no reason why in 2022, Californians are still waiting for the legal relief to which they were first promised six years ago. AB 1706 finally allows people to move on with their lives without serving the life sentence of collateral consequences from having a criminal history,” Bonta told Cannabis Wire.
AB 1954 (Sponsor: Assembly member Bill Quirk): This bill prevents doctors from “automatically denying treatment or medication” to patients who consume cannabis “without first completing a case-by-case evaluation of the patient that includes a determination that the qualified patient’s use of medical cannabis is medically significant, as defined, to the treatment or medication.” It protects doctors from being “punished, or denied any right or privilege, for having administered treatment or medication to a qualified patient pursuant to the bill and consistent with the standard of care.”
AB 2595 (Sponsor: Assembly member Reginald Byron Jones-Sawyer, Sr.): This bill outlines that “when a social worker is investigating an alleged case of child abuse or neglect, a parent’s or guardian’s use or possession of cannabis is treated in the same manner as a parent’s or guardian’s use or possession of alcohol and legally prescribed medication.”
“Currently, mere possession of legal cannabis is insufficient to take custody of a family under case law. However, my office became aware of incidents where families are taken into dependency court solely for possessing legal cannabis, without any evidence of child abuse or neglect,” Jones-Sawyer, Sr. told Cannabis Wire earlier this summer.
“Drawing families into court, especially for this reason, is not only a stressful event that requires taking time off work or juggling schedules but can be incredibly traumatic for children,” Jones-Sawyer, Sr. added.
AB 1894 (Sponsor: Assembly member Luz Rivas): This bill requires certain cannabis vape packages, labels, and ads to “prominently display a specified message to properly dispose of an integrated cannabis vaporizer as hazardous waste.”
“For far too long, electronic vapes are being marketed as disposable when they are not legally disposable. The waste from vapes create significant environmental issues, yet, there is no traditional recycling system in place to collect and properly manage these products,” Rivas told Cannabis Wire earlier this summer.
“In order to educate consumers and prevent vapes from going in the trash, we must stop the marketing of these products in any way that implies they can be disposed of in the trash or recycling systems.”
AB 2568 (Sponsor: Assembly member Ken Cooley): This bill would make it so that it is “not a crime solely for individuals and firms to provide insurance and related services to persons licensed to engage in commercial cannabis activity.” Why would it be a crime? Again, because cannabis remains illegal under federal law.
SB 1186 (Sponsor: Sen. Scott Wiener): This bill prevents localities from prohibiting medical cannabis deliveries within their borders, to patients or caregivers.
AB 1646 (Sponsor: Assembly member Phillip Chen): This bill allows “cannabis beverages to be packaged in containers of any material that are clear or any color.” Under current law, cannabis drinks can be “packaged in glass containers that are clear or any color.”
AB 2925 (Sponsor: Assembly member Jim Cooper): This bill requires the State Department of Health Care Services to provide annually to the legislature “a spending report of funds from the Youth Education, Prevention, Early Intervention and Treatment Account,” which is supported by cannabis tax revenue.
AB 2210 (Sponsor: Assembly member Bill Quirk): This bill allows for a “temporary event license” so that cannabis can be sold (by a license holder) during an event at a venue with an alcohol license; however, alcohol cannot be sold or consumed during the event.
Noteworthy bills that didn’t make the cut:
A handful of other bills didn’t head to Newsom’s desk, even though, as Cannabis Wire previously reported, they advanced out of their own chamber.
AB 1656 (Sponsor: Assembly member Cecilia Aguiar-Curry): This bill would have allowed for hemp-derived CBD products to be sold at adult use cannabis shops.
Specifically, it would change the state’s cannabis law so that it “does not prohibit a licensee from manufacturing, distributing, or selling products that contain industrial hemp or cannabinoids, extracts, or derivatives from industrial hemp, if the product complies with all applicable state laws and regulations.”
The bill sponsor plans to reintroduce it next year, a staffer told Cannabis Wire.
SB 1097 (Sponsor: Sen. Richard Pan): This bill was another closely-watched one. As introduced, it would’ve required a “warning label” on the front of cannabis products that is “in the largest type possible for the area, is bright yellow, and includes a pictorial or graphic element.” And it would have required cannabis ads to include such warnings on “at least 15% of the face of the advertisement.”
However, the bill was heavily amended and this language was stricken. What remained was a requirement for “cannabis and cannabis product labels and inserts to include a clear and prominent warning regarding the risks that cannabis use may contribute to mental health problems, in addition to existing labeling requirements.” Proponents announced that they pulled support for the bill after “aggressive cannabis industry lobbying” led to it being “significantly watered down.”