H.B. 617
GENERAL ASSEMBLY OF NORTH CAROLINA
Apr 20, 2021
SESSION 2021 HOUSE PRINCIPAL CLERK
H D
HOUSE BILL DRH30288-MLf-61B
Short Title: Cannabis Legalization & Regulation. (Public)
Sponsors: Representative Autry.
Referred to:
1 A BILL TO BE ENTITLED
2 AN ACT TO LEGALIZE AND REGULATE THE SALE, POSSESSION, AND USE OF
3 CANNABIS IN NORTH CAROLINA.
4 The General Assembly of North Carolina enacts:
5
6 PART I. LEGALIZATION OF POSSESSION AND SALE OF CANNABIS
7 SECTION 1.1. The General Statutes are amended by adding a new Chapter to read:
8 "Chapter 18D.
9 "Regulation of Cannabis.
10 "Article 1.
11 "General Provisions.
12 "§ 18D-100. Findings.
13 The General Assembly finds all of the following:
14 (1) Cannabis prohibition, like alcohol prohibition before it, has been a wasteful
15 and destructive failure. About half of Americans admit to having used
16 cannabis despite more than eight decades of prohibition.
17 (2) Regulating cannabis similarly to alcohol will replace the uncontrolled illicit
18 market with a well-regulated system. Legalization allows regulation and
19 control to protect consumers, workers, communities, and the environment.
20 (3) The prohibition of cannabis has had an unfair, disparate impact on persons
21 and communities of color. A 2020 report by the American Civil Liberties
22 Union found black individuals are three and six-tenths times as likely as white
23 individuals to be arrested for cannabis possession, despite nearly identical use
24 rates.
25 (4) The prohibition of cannabis diverts law enforcement resources from violent
26 and property crimes and subjects civilians to unnecessary police interactions.
27 (5) Keeping cannabis illegal deprives the State of thousands of legal jobs and
28 hundreds of millions of dollars in tax revenue.
29 (6) The use of cannabis should be legal for persons 21 years of age or older and
30 subject to taxation and regulation in a manner that does all of the following:
31 a. Controls the production and distribution of cannabis under a system of
32 licensing, regulation, and taxation.
33 b. Includes lab testing, potency labeling, secure packaging, restrictions
34 on advertising, and education about responsible use and risks.
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1 c. Fosters a responsible industry, whereby businesses will only be
2 allowed to expand if they prioritize diversity, good wages,
3 sustainability, and community investment.
4 d. Promotes the participation of individuals most impacted by cannabis
5 prohibition in the legal, regulated industry.
6 e. Generates needed revenue, including to reinvest in communities that
7 have been disproportionately impacted by prohibition, for substance
8 abuse treatment and education, and to train more law enforcement
9 officers to detect impaired driving.
10 (7) It is necessary to ensure consistency and fairness in the application of this
11 Chapter throughout the State and that, therefore, the matters addressed by this
12 Chapter are, except as specified herein, matters of statewide concern.
13 "§ 18D-101. Definitions.
14 Unless the context requires otherwise, the following definitions apply in this Chapter:
15 (1) Cannabis. – All parts of the plant of the genus cannabis, the seeds thereof, the
16 resin extracted from any part of the plant, and every compound, manufacture,
17 salt, derivative, mixture, or preparation of the plant, its seeds, or its resin,
18 including cannabis concentrate. "Cannabis" does not include hemp, nor does
19 it include fiber produced from the stalks, oil or cake made from the seeds of
20 the plant, or sterilized seed of the plant, which is incapable of germination.
21 (2) Cannabis accessories. – Any equipment, products, or materials of any kind
22 that are used, intended for use, or designed for use in planting, propagating,
23 cultivating, growing, harvesting, composting, manufacturing, compounding,
24 converting, producing, processing, preparing, testing, analyzing, packaging,
25 repackaging, storing, vaporizing, or containing cannabis, or for ingesting,
26 inhaling, or otherwise introducing cannabis into the human body.
27 (3) Cannabis cultivation facility. – An entity registered to cultivate, prepare, and
28 package cannabis and sell cannabis to other cannabis establishments but not
29 to consumers. A cannabis cultivation facility may not produce cannabis
30 concentrates, tinctures, extracts, or other cannabis products unless it is also
31 licensed as a cannabis product manufacturing facility.
32 (4) Cannabis delivery service. – An entity registered to deliver cannabis to
33 consumers.
34 (5) Cannabis establishment. – A cannabis cultivation facility, a cannabis delivery
35 service, an on-site consumption establishment, a cannabis testing facility, a
36 cannabis product manufacturing facility, a cannabis transporter, a retail
37 cannabis store, or any other type of cannabis business authorized and
38 registered by the Department.
39 (6) Cannabis product manufacturing facility. – An entity registered to purchase
40 cannabis; manufacture, prepare, and package cannabis products; and sell
41 cannabis and cannabis products to other cannabis establishments but not to
42 consumers.
43 (7) Cannabis products. – Products that are comprised of cannabis, cannabis
44 concentrate, or cannabis extract and other ingredients and are intended for use
45 or consumption, such as, but not limited to, edible products, ointments, and
46 tinctures.
47 (8) Cannabis testing facility. – An entity registered to test cannabis for potency
48 and contaminants.
49 (9) Cannabis transporter. – An entity registered to transport cannabis between
50 cannabis establishments.
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1 (10) Consumer. – A person 21 years of age or older who purchases cannabis or
2 cannabis products for personal use by persons 21 years of age or older, but not
3 for resale.
4 (11) Department. – The Department of Public Safety.
5 (12) Hemp. – The plant of the genus cannabis and any part of such plant, whether
6 growing or not, with a delta-9 tetrahydrocannabinol concentration that does
7 not exceed three-tenths percent (0.3%) on a dry weight basis of any part of the
8 plant cannabis, or per volume or weight of cannabis product, or the combined
9 percent of delta-9 tetrahydrocannabinol and tetrahydrocannabinolic acid in
10 any part of the cannabis plant regardless of moisture content.
11 (13) Locality. – A city or county.
12 (14) Office. – The Office of Social Equity.
13 (15) On-site consumption establishment. – An entity registered to sell cannabis or
14 cannabis products for on-site consumption.
15 (16) Possession limit. – Any of the following amounts:
16 a. Two ounces of cannabis in a form other than concentrated cannabis or
17 cannabis products.
18 b. Fifteen grams of concentrated cannabis.
19 c. Cannabis products containing no more than 2,000 milligrams of
20 tetrahydrocannabinol.
21 d. Six cannabis plants.
22 e. Any additional cannabis produced by the person's cannabis plants
23 provided that the possession of any amount of cannabis in excess of 2
24 ounces of cannabis, 15 grams of concentrated cannabis, and cannabis
25 products containing no more than 2,000 milligrams of
26 tetrahydrocannabinol must be limited to the same property where the
27 plants were cultivated.
28 (17) Public place. – Any place to which the general public has access. It does not
29 include an on-site consumption establishment.
30 (18) Retail cannabis store. – An entity registered to purchase cannabis from
31 cannabis establishments and sell cannabis and cannabis products to
32 consumers.
33 "§ 18D-102. Applicability.
34 This Chapter does not apply to medical cannabis regulated under Article 43 of Chapter 90 of
35 the General Statutes.
36 "Article 2.
37 "Office of Social Equity.
38 "§ 18D-200. Creation of the Office of Social Equity.
39 There is established in the Department the Office of Social Equity. The Governor shall
40 appoint an Executive Director of the Office, who shall have at least five years of experience in
41 civil rights advocacy, civil rights litigation, or social justice.
42 "§ 18D-201. Establishment of funds.
43 (a) The following funds are established in the Department:
44 (1) The Community Reinvestment and Repair Fund.
45 (2) The Social Equity Fund.
46 (3) The Cannabis Education and Technical Assistance Fund.
47 (b) No later than July 1 of each year, the Office shall produce and make publicly available
48 a report on how the Community Reinvestment and Repair Fund, Social Equity Fund, and
49 Cannabis Education and Technical Assistance Fund were allocated during the prior fiscal year.
50 (c) No later than November 1 of each year, the Office shall solicit public input on the
51 uses of the Community Reinvestment and Repair Fund, Social Equity Fund, and Cannabis
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1 Education and Technical Assistance Fund. The Office of Social Equity shall publish a review of
2 feedback received no later than December 15 of each year.
3 "§ 18D-202. Powers and duties of the Office.
4 The Office shall promote and encourage full participation in the regulated cannabis industry
5 by people from communities that have previously been disproportionately harmed by cannabis
6 prohibition and enforcement in order to positively impact those communities. The Office shall
7 have all of the following powers and duties:
8 (1) Defining, by rule, the term "social equity applicant" and considering whether
9 the definition should include any or all of the following:
10 a. Individuals with past convictions for a cannabis offense.
11 b. Individuals whose parent had a prior conviction for a cannabis offense.
12 c. Individuals who have had a less than honorable discharge from the
13 military due to cannabis.
14 d. Individuals from census tracts or other geographic areas
15 disproportionately impacted by cannabis enforcement, poverty,
16 unemployment, cannabis prohibition, mass incarceration, or systemic
17 racism.
18 e. Racial and ethnic minorities that have been disproportionately
19 impacted by cannabis enforcement.
20 f. Racial and ethnic minorities that have been disproportionately
21 excluded from the legal cannabis industry.
22 (2) Administering the Community Reinvestment and Repair Fund to improve the
23 well-being of individuals and communities that have experienced a
24 disproportionate negative impact from poverty, unemployment, cannabis
25 prohibition and enforcement, mass incarceration, or systemic racism. Before
26 determining how funds from the Community Reinvestment and Repair Fund
27 will be allocated, the Office shall promote and hold public meetings in at least
28 10 of the census tract areas that have been significantly impacted by poverty,
29 unemployment, cannabis prohibition, mass incarceration, or systemic racism
30 to seek input on the communities' needs and priorities for the Community
31 Reinvestment and Repair Fund. The Office of Social Equity shall distribute
32 funds from the Community Reinvestment and Repair Fund in a manner that
33 improves the well-being of communities and individuals that have been
34 significantly impacted by poverty, unemployment, cannabis prohibition, mass
35 incarceration, or systemic racism. Permissible uses of the fund include, but
36 are not limited to, grants to nonprofit organizations or allocations to
37 government agencies for any of the following:
38 a. Housing assistance, including to promote home ownership among
39 members of minority groups that are underrepresented in home
40 ownership due to redlining or discrimination.
41 b. Reentry services, including job training and placement.
42 c. Scholarship assistance for low-income students.
43 d. Grants to community-based organizations to provide services to
44 prevent violence, support youth development, provide early
45 intervention for youth and families, and promote community stability
46 and safety.
47 e. Legal or civic aid.
48 (3) Administering the Social Equity Fund to issue zero-interest loans and grants
49 to social equity applicants and cannabis establishments owned and operated
50 by social equity applicants.
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1 (4) Administering the Cannabis Education and Technical Assistance Fund to
2 provide free or low-cost training, education, and technical assistance for
3 individuals working in the cannabis industry or owning a cannabis
4 establishment, with a focus on individuals who would qualify as social equity
5 applicants.
6 (5) Advising the Department regarding regulations, including advising against
7 implementing regulations and financial requirements that unnecessarily
8 impose financial burdens that undermine the purposes of this Chapter and
9 providing recommendations on regulations related to diversity, social equity
10 applications, and the Race to the Top scoring system.
11 (6) Producing reports and recommendations on diversity and equity in the legal
12 cannabis economy, including in ownership, management, and employment.
13 (7) Investigating whether businesses are adhering to their obligations, including
14 those undertaken as part of the Race to the Top scoring system, and
15 recommending corrective action or discipline if they fail to do so, which may
16 include a suspension or revocation of licenses.
17 "Article 3.
18 "Registration and Licensure.
19 "§ 18D-300. Registration with the Department.
20 (a) Each ap