AB64: The California Legislature Gets to Work Tweaking Proposition 64 and MCRSA

After the victory of Proposition 64 at the ballot box, we should expect to see a number of tweaks and refinements to the law as it rolls toward implementation.  The first significant post-election bill was introduced on December 12.  This bill — AB 64 — is notable in that it is sponsored by Rob Bonta and Jim Wood, two of the state legislators most active on cannabis issues, as well as Ken Cooley, Reginald Jones-Sawyer, and Tom Lackey, a Republican. 

AB 64 addresses five issues.  

First, commercial medical cannabis operations in California have protection from certain state criminal charges if they are organized as collectives or cooperatives and operate on a non-profit basis.  AB64 would amend California Health and Safety Code 11362.775(a) to allow collectives and cooperatives to operate on a for-profit basis in the period until licensing under the MCRSA begins.  AB64 would add Business & Professions Code Section to 19322.5 to clarify that, after receiving a MCRSA license, a medical cannabis operation could also operate on for-profit basis.  Some in the industry have been concerned that for-profit operations may not be allowed under the state law even after obtaining MCRSA licenses.  Though that concern may be without basis in the existing statute, AB64 would make it abundantly clear that for-profit operations are allowed. 

Second, AB64 would allow retail licensees under Proposition 64 (AUMA) and the MCRSA to operate delivery services without having a publicly accessible storefront -- that is, a delivery-only service with no brick and mortar dispensary.  There has been significant controversy as to whether delivery services are allowed by the Proposition 64.  AB64 would expressly allow delivery services.

Third, AB64 would expand and clarify restrictions on cannabis advertising and marketing.  It would ban all cannabis advertising on interstates and state highways.   (Here in Oakland, those billboards are very common; we saw four or five on a recent short drive down I-880 between downtown and the Golden State Warriors game to see Klay Thompson score 60.) AB64 would also impose some other restrictions, such as banning medical cannabis give-away promotions.

Fourth, AB64 would allow state trademark and service mark protection for medical and adult-use cannabis products.  California currently follows federal law and does not allow such protection.

Fifth, AB64 would advance $3 million to the California Highway Patrol for research on impaired driving.  

Expect to see more legislative activity in the coming days.