Bill Summary – FastDemocracy

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68th Legislature 2023                                                                                       HB 948.1
                                              HOUSE BILL NO. 948
                                        INTRODUCED BY S. GALLOWAY
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  A BILL FOR AN ACT ENTITLED: “AN ACT REVISING MARIJUANA LAWS; PROHIBITING THE
  MANUFACTURE AND DISTRIBUTION OF SYNTHETIC MARIJUANA PRODUCTS; PROVIDING
  DEFINITIONS; PROVIDING FOR ENFORCEMENT BY DEPARTMENTS AND LAW ENFORCEMENT;
  PROVIDING FOR RESTRICTIONS BY LOCAL GOVERNMENTS; CLARIFYING UNLAWFUL
  TRANSACTIONS REGARDING THE DISTRIBUTION OF SYNTHETIC MARIJUANA PRODUCTS TO
  CHILDREN; CLARIFYING THE OFFENSE OF ALTERING A LABEL ON DANGEROUS DRUGS; REQUIRING
  PUBLIC REPORTING OF VIOLATIONS; CREATING A TEMPORARY ADVISORY COUNCIL; ESTABLISHING
  REPORTING REQUIREMENTS; PROVIDING AN APPROPRIATION; AMENDING SECTIONS 16-12-101, 16-
  12-102, 16-12-108, 16-12-125, 45-5-623, 45-9-105, 50-32-222, AND 80-18-101, MCA; AND PROVIDING AN
  IMMEDIATE EFFECTIVE DATE AND A TERMINATION DATE.”
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  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:
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          NEW SECTION. Section 1.       Synthetic marijuana products prohibited -- restriction on sale of
  marijuana products. (1) A person may not manufacture, process, or offer for sale a synthetic marijuana
  product.
          (2)      Products containing or consisting of cannabinoids produced and processed for any type of
  consumption into a human body, whether marketed as containing or consisting of cannabinoids or not, that
  exceed a THC concentration of 0.3% may only be sold by a manufacturer licensed under 16-12-222 or a
  dispensary licensed under 16-12-224 unless the products are authorized as a drug by the United States food
  and drug administration. Products under this section may not exceed the potency levels established in 16-12-
  224.
          (3)      Products containing a THC concentration of 0.3% or less sold by any person other than a
  licensed manufacturer under 16-12-222 or a licensed dispensary under 16-12-224 must contain at least a 20:1
  ratio of cannabidiol or other non-THC cannabinoids to THC and may not exceed 2 milligrams of THC for each
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68th Legislature 2023                                                                                           HB 948.1
  serving.
             (4)     This section does not apply to unadulterated hemp flower that is not further processed into
  extracts, infused products, or concentrates.
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             NEW SECTION. Section 2.         Enforcement -- ordinances -- investigations -- violation. (1) A local
  government may, by ordinance or otherwise, impose regulations regarding products under [section 1(1) and
  (3)].
             (2)     The department of agriculture, the department of justice, the department of public health and
  human services, local sheriff departments, municipal police departments, and the department of revenue may
  inspect any business to investigate unlawful activity under [section 1(1)].
             (3)     A violation of [section 1(1)] may be enforced under:
             (a)     criminal distribution of dangerous drugs as defined in 45-9-101;
             (b)     criminal possession of dangerous drugs as defined in 45-9-102; or
             (c)     criminal production or manufacture of dangerous drugs as defined in 45-9-110.
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             NEW SECTION. Section 3.         Synthetic marijuana products advisory council. (1) The department
  of revenue shall establish a synthetic marijuana products advisory council in accordance with 2-15-122 that is
  composed of the following members:
             (a)     one member from the department of agriculture;
             (b)     one member from the department of justice;
             (c)     one member from the department of public health and human services;
             (d)     one member from the department of revenue;
             (e)     one member from the board of pharmacy;
             (f)     two members from the marijuana industry; and
             (g)     one public member. The public member must have expertise in:
             (i)     toxicology;
             (ii)    organic chemistry; or
             (iii)   regulatory affairs in nutraceutical, pharmaceutical, or dietary supplements.
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68th Legislature 2023                                                                                                HB 948.1
            (2)      The department shall provide staff and support services for the advisory council.
            (3)      Members are entitled to reimbursement for travel expenses as provided in 2-18-501 through 2-
  18-503.
            (4)      The advisory council shall review available research, data, and regulations of other jurisdictions
  related to synthetic marijuana products, including but not limited to:
            (a)      definitions of the term "impairing" in relation to cannabinoids, as well as definitions of the terms
  "artificial cannabinoids" and "synthetically derived cannabinoids"; and
            (b)      recommendations on potential guidelines for safe methods of manufacturing, extracting, and
  synthesizing cannabinoids, including the sale of synthetic marijuana products.
            (5)      The advisory committee shall compile findings and make recommendations in a report to the
  economic affairs interim committee, in accordance with 5-11-210, regarding regulating synthetic marijuana
  products in the adult-use marijuana market by September 15, 2024.
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            Section 4. Section 16-12-101, MCA, is amended to read:
            "16-12-101.    Short title -- purpose. (1) This chapter may be cited as the "Montana Marijuana
  Regulation and Taxation Act".
            (2)      The purpose of this chapter is to:
            (a)      provide for legal possession and use of limited amounts of marijuana legal for adults 21 years
  of age or older;
            (b)      provide for the licensure and regulation of the cultivation, manufacture, production, distribution,
  transportation, and sale of marijuana and marijuana products;
            (c)      eliminate the illicit market for marijuana and marijuana products;
            (d)      prevent the manufacture and distribution of synthetic marijuana products;
            (d)(e)   prevent the distribution of marijuana sold under this chapter to persons under 21 years of age;
            (e)(f)   ensure the safety of marijuana and marijuana products;
            (f)(g)   ensure the security of licensed premises;
            (g)(h)   establish reporting requirements for licensees;
            (h)(i)   establish inspection requirements for licensees, including data collection on energy use,
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68th Legislature 2023                                                                                            HB 948.1
  chemical use, water use, and packaging waste to ensure a clean and healthy environment;
          (i)(j)   provide for the testing of marijuana and marijuana products by licensed testing laboratories;
          (j)(k)   give local governments authority to allow for the operation of marijuana businesses in their
  community and establishing standards for the cultivation, manufacture, and sale of marijuana that protect the
  public health, safety, and welfare of residents within their jurisdictions;
          (k)(l)   tax the sale of marijuana and marijuana products to provide compensation for the economic
  and social costs of marijuana;
          (l)(m)   authorize courts to resentence persons who are currently serving sentences for acts that are
  permitted under this chapter or for which the penalty is reduced by this chapter and to redesignate or expunge
  those offenses from the criminal records of persons who have completed their sentences as set forth in this
  chapter; and
          (m)(n) preserve and protect Montana's well-established hemp industry by drawing a clear distinction
  between those participants and programs and the participants and programs associated with the marijuana
  industry.
          (3)      Marijuana and marijuana products are not agricultural products, and the cultivation, processing,
  manufacturing or selling of marijuana or marijuana products is not considered agriculture subject to regulation
  by the department of agriculture unless expressly provided."
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          Section 5. Section 16-12-102, MCA, is amended to read:
          "16-12-102. Definitions. As used in this chapter, the following definitions apply:
          (1)      "Adult-use dispensary" means a licensed premises from which a person licensed by the
  department may:
          (a)      obtain marijuana or marijuana products from a licensed cultivator, manufacturer, dispensary, or
  other licensee approved under this chapter; and
          (b)      sell marijuana or marijuana products to registered cardholders, adults that are 21 years of age
  or older, or both.
          (2)      "Affiliate" means a person that directly, or indirectly through one or more intermediaries,
  controls or is controlled by, or is under common control with, another person.
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68th Legislature 2023                                                                                              HB 948.1
          (3)      "Beneficial owner of", "beneficial ownership of", or "beneficially owns an" is determined in
  accordance with section 13(d) of the federal Securities and Exchange Act of 1934, as amended.
          (4)      "Canopy" means the total amount of square footage dedicated to live plant production at a
  licensed premises consisting of the area of the floor, platform, or means of support or suspension of the plant.
          (5)      "Consumer" means a person 21 years of age or older who obtains or possesses marijuana or
  marijuana products for personal use from a licensed dispensary but not for resale.
          (6)      "Control", "controls", "controlled", "controlling", "controlled by", and "under common control
  with" mean the possession, direct or indirect, of the power to direct or cause the direction of the management or
  policies of a person, whether through the ownership of voting owner's interests, by contract, or otherwise.
          (7)      "Controlling beneficial owner" means a person that satisfies one or more of the following:
          (a)      is a natural person, an entity that is organized under the laws of and for which its principal
  place of business is located in one of the states or territories of the United States or District of Columbia, or a
  publicly traded corporation, and:
          (i)      acting alone or acting in concert, owns or acquires beneficial ownership of 5% or more of the
  owner's interest of a marijuana business;
          (ii)     is an affiliate that controls a marijuana business and includes, without limitation, any manager;
  or
          (iii)    is otherwise in a position to control the marijuana business; or
          (b)      is a qualified institutional investor acting alone or acting in concert that owns or acquires
  beneficial ownership of more than 15% of the owner's interest of a marijuana business.
          (8)      "Correctional facility or program" means a facility or program that is described in 53-1-202(2) or
  (3) and to which an individual may be ordered by any court of competent jurisdiction.
          (9)      "Cultivator" means a person licensed by the department to:
          (a)      plant, cultivate, grow, harvest, and dry marijuana; and
          (b)      package and relabel marijuana produced at the location in a natural or naturally dried form that
  has not been converted, concentrated, or compounded for sale through a licensed dispensary.
          (10)     "Debilitating medical condition" means:
          (a)      cancer, glaucoma, positive status for human immunodeficiency virus, or acquired immune
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68th Legislature 2023                                                                                                HB 948.1
  deficiency syndrome when the condition or disease results in symptoms that seriously and adversely affect the
  patient's health status;
          (b)      cachexia or wasting syndrome;
          (c)      severe chronic pain that is a persistent pain of severe intensity that significantly interferes with
  daily activities as documented by the patient's treating physician;
          (d)      intractable nausea or vomiting;
          (e)      epilepsy or an intractable seizure disorder;
          (f)      multiple sclerosis;
          (g)      Crohn's disease;
          (h)      painful peripheral neuropathy;
          (i)      a central nervous system disorder resulting in chronic, painful spasticity or muscle spasms;
          (j)      admittance into hospice care in accordance with rules adopted by the department; or
          (k)      posttraumatic stress disorder.
          (11)     "Department" means the department of revenue provided for in 2-15-1301.
          (12)     (a) "Employee" means an individual employed to do something for the benefit of an employer.
          (b)      The term includes a manager, agent, or director of a partnership, association, company,
  corporation, limited liability company, or organization.
          (c)      The term does not include a third party with whom a licensee has a contractual relationship.
          (13)     (a) "Financial interest" means a legal or beneficial interest that entitles the holder, directly or
  indirectly through a business, an investment, or a spouse, parent, or child relationship, to 5% or more of the net
  profits or net worth of the entity in which the interest is held.
          (b)      The term does not include interest held by a bank or licensed lending institution or a security
  interest, lien, or encumbrance but does include holders of private loans or convertible securities.
          (14)     "Former medical marijuana licensee" means a person that was licensed by or had an
  application for licensure pending with the department of public health and human services to provide marijuana
  to individuals with debilitating medical conditions on November 3, 2020.
          (15)     (a) "Indoor cultivation facility" means an enclosed area used to grow live plants that is within a
  permanent structure using artificial light exclusively or to supplement natural sunlight.
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68th Legislature 2023                                                                                            HB 948.1
          (b)      The term may include:
          (i)      a greenhouse;
          (ii)     a hoop house; or
          (iii)    a similar structure that protects the plants from variable temperature, precipitation, and wind.
          (16)     "Licensed premises" means all locations related to, or associated with, a specific license that is
  authorized under this chapter and includes all enclosed public and private areas at the location that are used in
  the business operated pursuant to a license, including offices, kitchens, restrooms, and storerooms.
          (17)     "Licensee" means a person holding a state license issued pursuant to this chapter.
          (18)     "Local government" means a county, a consolidated government, or an incorporated city or
  town.
          (19)     "Manufacturer" means a person licensed by the department to convert or compound marijuana
  into marijuana products, marijuana concentrates, or marijuana extracts and package, repackage, label, or
  relabel marijuana products as allowed under this chapter.
          (20)     (a) "Marijuana" means all plant material from the genus Cannabis containing
  tetrahydrocannabinol (THC) or seeds of the genus capable of germination.
          (b)      The term does not include hemp, including any part of that plant, including the seeds and all
  derivatives, extracts, cannabinoids, isomers, acids, salts, and salts of isomers, whether growing or not, with a
  delta-9 tetrahydrocannabinol concentration of not more than 0.3% on a dry weight basis, or commodities or
  products manufactured with hemp, or any other ingredient combined with marijuana to prepare topical or oral
  administrations, food, drink, or other products as provided in 80-18-101.
          (c)      The term does not include synthetic marijuana products.
          (c)(d)   The term does not include a drug approved by the United States food and drug administration
  pursuant to section 505 of the Federal Food, Drug, and Cosmetic Act, 21 U.S.C. 301, et seq.
          (21)     "Marijuana business" means a cultivator, manufacturer, adult-use dispensary, medical
  marijuana dispensary, combined-use marijuana licensee, testing laboratory, marijuana transporter, or any other
  business or function that is licensed by the department under this chapter.
          (22)     "Marijuana concentrate" means any type of marijuana product consisting wholly or in part of the
  resin