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CITY OF SIMI VALLEY MEMORANDUM

December 5, 2016

TO: City Council FROM: Department of Environmental Services SUBJECT: CONSIDERATION OF ADOPTION OF AN URGENCY ORDINANCE

ESTABLISHING A MORATORIUM PROHIBITING ALL MARIJUANA USES, OPERATIONS, AND ACTIVITIES AND ALL PERSONAL OUTDOOR CULTIVATION OF MARIJUANA WITHIN THE CITY, AND A DETERMINATION THAT THE ACTION IS EXEMPT FROM THE CALIFORNIA ENVIRONMENTAL QUALITY ACT

STAFF RECOMMENDATION It is recommended that City Council adopt the attached urgency ordinance (page 7) to establish a 45-day moratorium prohibiting all marijuana uses, operations, and activities and all personal outdoor cultivation of marijuana within the City, and make a determination that the action is exempt from the California Environmental Quality Act. CITY MANAGER’S RECOMMENDATION The City Manager recommends establishing a 45-day moratorium prohibiting all marijuana uses, operations, and activities and all personal outdoor cultivation of marijuana within the City. This will provide the City Council a 45 day period to request staff to further research any aspects of Proposition 64 and the City’s ability to regulate specific aspects of commercial operations and personal outdoor cultivation of marijuana. BACKGROUND AND OVERVIEW The California voters enacted Proposition 64, “The Control, Regulate and Tax Adult Use of Marijuana Act” which became effective on November 9, 2016, as provided in Attachment A (page 17). This Act establishes a State regulatory licensing system that allows for commercial marijuana uses, operations, and activities and allows adult indoor or outdoor cultivation of personal marijuana. If the use is not enumerated as a permitted use in the Municipal Code’s zoning regulations, it is not permitted. Because adult cultivation of personal marijuana and commercial marijuana uses are not listed as a permitted or conditional use in any zoning district, it is not legal to cultivate, process, manufacture, test, label, store, distribute, sell, or deliver commercial or non-medical marijuana or personally cultivate marijuana within the City. Without sufficient regulations that are expressly enforceable pursuant to a permanent ordinance, there is a current and immediate threat to the public health, safety, and welfare from ambiguous

AGENDA ITEM NO.

8B

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regulations and inadequate indoor residential regulations, including the potential for harmful impacts discussed below under Findings and Alternatives. Based on the City’s past experiences amending the Municipal Code to expressly prohibit medical marijuana uses, operations, and activities, staff similarly recommends that the City Council adopt an urgency ordinance moratorium to expressly state that commercial marijuana uses, operations, and activities are prohibited within the City. Adopting the urgency ordinance would also prohibit outdoor cultivation of medical or personal marijuana on a resident’s property. This urgency ordinance allows staff time to study code amendments and best practices within the framework of the recent voter enacted Act. This urgency ordinance requires a four-fifths vote (4/5ths vote) of the City Council. FINDINGS AND ALTERNATIVES Effects of the Control, Regulate, and Tax Adult Use of Marijuana Act The Control, Regulate, and Tax Adult Use of Marijuana Act (Act) creates the framework for a State program for licensing commercial marijuana activities, including cultivators, manufacturers, distributers, transporters for deliveries, and dispensaries. Commercial marijuana would be tracked and traced from cultivation through sales. It would be illegal to sell commercial as well as personal marijuana without a State license. As similar with the State’s medical marijuana licensing program authorized under the Medical Marijuana Regulation and Safety Act, the State would be required to begin issuing licenses by January 1, 2018. The Act allows for the potential establishments of many new commercial and non-medical marijuana cultivators, manufacturers, distributers, transporters for deliveries, dispensaries, and other similar commercial marijuana uses. However, the Act authorizes city and county local governments the authority to regulate or prohibit these commercial marijuana uses, operations, and activities. Also, the Act provides that local government cannot prevent transport of marijuana or marijuana products on public roads between entities licensed under the State’s program. The Act establishes a State regulatory structure, licensing system, and enforcement provisions for commercial and personal marijuana cultivation, processing, manufacture, distribution, testing, and sale as provided in Attachment A (page 17). The Act also legalizes marijuana for the personal use (21 years or over), to smoke, ingest marijuana products, and to possess, transport, purchase, obtain, or give away without compensation of any sort. The personal use possession per person is limited to: not more than 28.5 grams of marijuana (not concentrated from cannabis); four to eight grams of concentrated marijuana (including that contained in products such as edibles); and, six live marijuana plants. Adult persons would be allowed to personally cultivate up to a maximum of six live plants located inside an enclosed and secured private residence, an accessory structure to the residence, or within a secured and enclosed outdoor area on property of the residence. It would be illegal to sell personal marijuana. The Act defines a “private residence” as including: a house, an apartment unit, a mobile home, or other similar dwelling. Local governments may “reasonably regulate” the adult indoor cultivation of personal marijuana in private residences

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or inside its accessory structure and to completely prohibit its outdoor cultivation. These regulations would be studied and provided to the City Council for consideration as amendments at a future public hearing. Increased Effects of Marijuana Uses, Operations, Activities in the City The cultivation, transportation, and distribution of marijuana can create a variety of situations for a community. A few examples are provided below: 1. Marijuana plants, as they begin to flower and for a period of two months or more,

produce a strong odor, offensive to many people, and detectable far beyond property boundaries if grown outdoors. Also, the strong smell of marijuana creates an attractive nuisance, alerting persons to the location of the valuable plants, and creating a risk of burglary, robbery or armed robbery;

2. The potential for burglary or robbery is high because marijuana plants are valuable. The U.S. Drug Enforcement Agency reports that each marijuana plant under various planting conditions may yield an average between one-half to two pounds in its lifetime. Prices for domestically produced high-grade marijuana sold illegally within Northern California can reach $2,000 to $5,000 per pound;

3. The indoor residential cultivation of marijuana has potential adverse effects to the health and safety of the occupants, including damage to the structural integrity of a building from increased moisture and mold, increased bugs or insects, risk of fire and electrocution from high intensity light fixtures, and chemical contamination from the use of pesticides and fertilizers;

4. There is potential for exposure to or increased usage by school-aged children from non-secured areas used for either indoor or outdoor residential cultivation of any marijuana;

5. The manufacturing of marijuana products involve the use of chemicals and solvents, and as a result, the manufacturing of hash oil concentrate, often added to edibles, drinks and liquids, carries a significant risk of explosion due to the distillation process to extract tetrahydrocannabinol;

6. Several California cities have reported negative impacts of marijuana cultivation, processing and distribution activities, including offensive odors, illegal sales and distribution of marijuana, trespassing, theft, violent robberies and robbery attempts, fire hazards, and problems associated with mold, fungus, and pests; and,

7. The California Attorney General's August 2008 Guidelines for the Security and Non-Diversion of Marijuana Grown for Medical Use recognizes that the cultivation or other concentration of marijuana in any location or premises without adequate security increases the risk that nearby homes or businesses may be negatively impacted by nuisance activity such as loitering or crime.

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Duration of the Urgency Ordinance’s Moratorium Pursuant to Government Code Section 65858, the urgency (interim) ordinance will be effective immediately upon its adoption with a fourth-fifths (4/5ths) vote by the City Council for a maximum period of 45 days. After providing notice, the urgency ordinance will be brought back before the City Council for consideration at a public hearing on January 9, 2017, which will then have an opportunity to extend it another 10 months and 15 days. The staff report at that time will address any policy considerations as directed by the City Council during tonight’s meeting. If necessary, the City Council can authorize one further extension (for an additional year) after the 10 month and 15 day period has expired. During the 45-day moratorium, staff recommends the City Council direct staff to study necessary amendments to the Municipal Code land use regulations, consistency with the General Plan, and other regulations within the framework of the Control, Regulate and Tax Adult Use of Marijuana Act (Proposition 64), including policy consideration on a prohibition of commercial marijuana uses, operations, and activities, a prohibition of marijuana smoking and ingesting at businesses, microbusinesses, and other similar public places, prohibiting outdoor marijuana cultivation on a residence’s property, regulations permitting indoor personal and medical cultivation inside a residence or accessory structure of residence. Areas for the Council’s consideration in providing that direction include:

• Should the City Council wish to ban outside personal cultivation, or the retail sale of marijuana, the City will not be eligible for upcoming grants identified in the Adult Use of Marijuana Act for programs including youth programs, substance abuse education, prevention and treatment or the reduction of DUIs. This evening’s action for a temporary moratorium will not impact the City’s ability to obtain grant funding in the future, should the Council allow for outside personal cultivation or the retail sale of marijuana at a future meeting.

• Should the Council wish to allow for the retail sales of marijuana, does it want to consider a sales tax on the November 2018 ballot? Or impose business regulatory fees directly related to the regulation of the type of business, including issuing licenses, performing investigations, audits, and inspections?

• Does the City Council wish to consider expanding anti-smoking regulations in the community? All anti-smoking regulations that currently apply to tobacco will apply to marijuana.

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Environmental Review and CEQA Requirements Adoption of the urgency ordinance has been determined to be exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15061(b)(3) of the State CEQA Guidelines, which states that:

“A project is exempt from CEQA if the activity is covered by the general rule that CEQA applies only to the project, which has the potential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA.”

The urgency ordinance would not create a significant effect on the environment because it establishes a moratorium for 45-days prohibiting all marijuana uses, operations, and activities and prohibiting all outdoor cultivation of personal marijuana. Therefore, the adoption of the urgency ordinance meets the standards set forth in Section 15061(b)(3), and is exempt from further review under CEQA. Based on this determination and pursuant to Section 15062, a Notice of Exemption has been prepared as provided in Attachment B (page 50). The following alternatives are available to the City Council: 1. Adopt the attached urgency ordinance (page 7) to establish a 45-day moratorium

prohibiting all marijuana uses, operations, and activities and all personal outdoor cultivation of marijuana within the City, and make a determination that the action is exempt from the California Environmental Quality Act;

2. Do not pass the urgency ordinance; 3. Provide staff with further direction. Staff recommends Alternative No. 1. SUGGESTED CITY COUNCIL MOTION I move to adopt the urgency ordinance to establish a 45-day moratorium prohibiting all marijuana uses, operations, and activities and all personal outdoor cultivation of marijuana within the City, and make a determination that the action is exempt from the California Environmental Quality Act. SUMMARY To protect the public safety, health, and welfare in response to the recent enactment of the California Control, Regulation, and Adult Use of Marijuana Act (Proposition 64), which changed State laws to allow State licensing of commercial marijuana uses, operations, and activities, and the adult indoor and outdoor cultivation of six live marijuana plants at their residence, a 45-day moratorium is recommended. The City of Simi Valley may adopt an urgency (interim) ordinance pursuant to California Government Code Section 65858 establishing a 45-day moratorium prohibiting all marijuana uses, operations, and activities and all personal outdoor cultivation of

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marijuana at residences within the City. Adoption of the urgency ordinance would allow City staff to study the impacts of the changes in the law as it relates to zoning and the General Plan, and any increase in reported illegal activities related to commercial or non-medical marijuana uses, operations, and activities. A four-fifths vote is required for passage of the urgency ordinance. After notice and a public hearing pursuant to Government Code Section 65090, staff may return to the City Council with a request to extend the interim ordinance for up to 10 months 15 days. ____________________________________ Peter Lyons, Director Department of Environmental Services Prepared by: Tom Preece, Senior Planner INDEX Page Urgency Ordinance ......................................................................................................... 7 Attachment A – Control, Regulate, and Tax Adult Use of Marijuana Act ....................... 17 Attachment B – Notice of Exemption ............................................................................. 50

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ORDINANCE NO. 1264

AN URGENCY ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SIMI VALLEY ESTABLISHING A MORATORIUM PROHIBITING ALL MARIJUANA USES, OPERATIONS, AND ACTIVITIES AND ALL PERSONAL OUTDOOR CULTIVATION OF MARIJUANA WITHIN THE CITY, AND A DETERMINATION THAT THE ACTION IS EXEMPT FROM THE CALIFORNIA ENVIRONMENTAL QUALITY ACT

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SIMI VALLEY DOES ORDAIN AS FOLLOWS:

SECTION 1. Authority. This urgency Ordinance is adopted in accordance with provisions as set forth below:

A. California Constitution, Article 11, Section 7 authorizes a City

Council to make and enforce within its limits all local, police, sanitary, and other ordinances and regulations not in conflict with general laws to protect and promote the public health, safety, and welfare of its citizens.

B. Pursuant to California Government Code Section 65858, the City

Council may as an urgency measure adopt an interim (urgency) ordinance by a four-fifths vote to protect the public health, safety, and welfare prohibiting any use that may be in conflict with a contemplated land use regulations that the City is studying or considering or intends to study within a reasonable time.

SECTION 2. Findings. The Simi Valley City Council finds, determines,

and declares the following in support of the enactment of this urgency Ordinance. A. This urgency Ordinance is exempt from review under the California

Environmental Quality Act (California Public Resources Code Section 21000 et seq.) (“CEQA”) and CEQA regulations (Title 14, California Code of Regulations Section 15000 et seq.) because this Amendment is covered by the general rule that CEQA only applies to projects that have the potential for causing a significant effect on the environment (Section 15061(b)(3)), and the ordinance does not create a significant effect on the environment because it would prohibit all marijuana uses, operations, and activities, prohibit marijuana smoking and ingesting at businesses, microbusinesses, or public places, and prohibit outdoor cultivation of personal marijuana by residents 21 years or older, except as allowed by the Compassionate Use Act.

B. The U.S. Congress enacted the Controlled Substances Act (United

States Code, Title 21, Chapter 13, Section 801 et seq.), which, among other things, makes it illegal to use, possess, import, manufacture, distribute, or cultivate marijuana. Also, the use, possession, and cultivation of marijuana are unlawful and subject to federal prosecution without regard to a claimed medical need.

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C. On November 5, 1996, California voters passed Proposition 215, “The Compassionate Use Act of 1996” (codified in California Health and Safety Code 11362.5), which allows medical marijuana use by qualified patients upon a physician’s recommendation. That the intent of this Act was to enable seriously ill Californians to legally possess, use, and cultivate marijuana for medical use under California law once a physician has deemed the use beneficial to a patient's health. In addition, the California Legislature adopted Senate Bill SB 420 in 2003 (codified in Health & Safety Code Section 11362.7 – 11362.83), which permits qualified patients and their primary caregivers to possess not more than eight ounces of dried marijuana per qualified patient and not more than six mature or 12 immature marijuana plants per qualified patient unless a medical doctor authorizes an additional amount consistent with the patient’s needs.

D. Neither the California Compassionate Use Act of 1996 or the

Medical Marijuana Program require or impose an affirmative duty or mandate upon a city or county local government to allow, authorize, or sanction the establishment of facilities that cultivate or process medical marijuana within its jurisdiction.

E. Assembly Bill 1300 was adopted in 2011(codified as Health and

Safety Code Section 11362.83) to clarify that city and county local governments may adopt and enforce local ordinances that regulate or prohibit the location, operation, or establishment of medical marijuana cooperatives or collectives.

F. On June 6, 2005, the United States Supreme Court issued its

decision in the case of Gonzales vs. Raich which held that Congress, under the Commerce Clause of the United States Constitution, has the authority, and under the Federal Controlled Substances Act the power to, prosecute the local cultivation and use of marijuana, even if such use is in compliance with California law.

G. The City Council adopted Ordinance No. 1106, which became

effective on January 18, 2007, to amend the Municipal Code to prohibit medical marijuana dispensaries within all zoning districts of the City of Simi Valley.

H. The California Supreme Court issued its decision in May 2013 in

City of Riverside v. Inland Empire Patients Health and Wellness Center, Inc. et al., holding that city local governments have the authority to prohibit or ban medical marijuana land uses.

I. In Maral v. City of Live Oak (2013) 221 Cal. App. 4th 975, the Court

of Appeal held that an ordinance which prohibited the cultivation of marijuana for any purpose was within the City’s police power and not preempted by the California Compassionate Use Act of 1996 or the California Medical Marijuana Program.

J. The California Medical Marijuana Regulation and Safety Act, which

became effective on January 1, 2016, contains provisions that create a State regulatory structure and licensing system for the commercial medical cultivation, manufacture, retail sale, transport, distribution, transportation, delivery, and testing of medical marijuana (cannabis). Under this Act, no person shall engage in said commercial medical activities without both a State license or permit or other authorization from their

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local City or County government (dual-licensing requirement). This Act also recognizes a range of medical marijuana referred to as “commercial cannabis activities,” including medical marijuana cultivation businesses, product manufacturers, distributors, transporters, testing laboratories, and dispensaries.

K. While the California Medical Marijuana Regulation and Safety Act

expressly authorizes a city or county local government control to regulate or prohibit medical marijuana facilities and land uses in their jurisdictions, the Act provides that the State will be the sole licensing authority if the local government does not enact ordinances that expressly regulate or prohibit medical marijuana facilities and land uses. On February 3, 2016, Assembly Bill 21 was signed by the Governor to amend the Act’s language that local government retained the right to prohibit cultivation without exception to instead state “Exemption from the requirements of the section does not limit or prevent a city, county, or city and county from exercising its police authority under Section 7 of Article XI of the California Constitution” (codified in Health & Safety Code §1362.777(g)).

L. The City Council adopted Ordinance No. 1255, which became

effective on April 13, 2016, to amend the Municipal Code land use regulations to expressly prohibit medical marijuana cultivation, processing, distribution, deliveries, collectives, and cooperatives within all zoning districts of the City of Simi Valley.

M. The California voters enacted Proposition 64, “The Control,

Regulate and Tax Adult Use of Marijuana Act,” which became effective on November 9, 2016. This establishes a State regulatory structure, licensing system, and enforcement provision for commercial or non-medical marijuana cultivation, processing, manufacture, distribution, testing, and sale. The Act also contains provisions that:

(1) Allow adult persons 21 years of age and older to possess,

transport, purchase, obtain, or give away to persons 21 years old or older without compensation non-concentrated marijuana of not more than 28.5 grams (ounce) and 8 grams of concentrated marijuana. Also, smoking or ingesting marijuana or marijuana products is allowed for adults. Further, adults are allowed to possess, transport, purchase, obtain, or give away marijuana accessories to persons 21 years old or older (Health & Safety Code §11362.1);

(2) Allow adult persons 21 years or older to plant, cultivate, harvest, dry, or process six live personal marijuana plants inside a single private residence or the inside the residence’s accessory structure that is fully enclosed and secured, or upon the grounds of that private residence that is fully enclosed and secured, at any one time. As defined, a residence includes a house, an apartment unit, a mobile home, or similar dwelling. Also, a city may reasonably regulate the cultivation, harvesting, drying, or processing of personal marijuana plants inside a private residence and inside the residence’s accessory structure and to completely prohibit outdoor cultivation of marijuana plants on the grounds of the residence, up

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to and until a “determination by the California Attorney General that nonmedical use of marijuana is lawful in the State of California under federal laws” (Health & Safety Code §11362.2);

(3) Prohibits the sale of commercial or non-medical marijuana by businesses that also sell alcohol or tobacco (Business & Professions Code §26054);

(4) Permit cities to completely regulate or prohibit the establishment and operation of any business licensed under a new State licensing system, including commercial or non-medical marijuana cultivation, processing, manufacturing, testing, labeling, storing, distributing, sale, microbusinesses (Business & Professions Code §26200). The State agencies are required to promulgate rules and regulations to begin issuing licenses by January 1, 2018;

(5) Permits cities to regulate or prohibit the smoking or ingesting of marijuana or marijuana products in any public place, such as a business or microbusiness (Business & Professions Code §26000); and

(6) Prevents cities from prohibiting the transportation of marijuana on public roads between State licensees (Business & Professions Code §260809(b)).

N. Under the Simi Valley Municipal Code, medical marijuana dispensaries, cultivation, processing, distribution, collectives, cooperatives, dispensaries are expressly prohibited. While the Municipal Code’s “permissive zoning” land use regulations prohibit commercial and non-medical marijuana uses, operations, activities, it is the City Council desires to enact this urgency Ordinance to expressly make clear that all such uses, operations, activities are prohibited throughout the City.

O. Without sufficient regulations that are expressly enforceable

pursuant to a permanent ordinance, the City Council finds that there is a current and immediate threat to the public health, safety, and welfare from ambiguous regulations, including the following harmful impacts:

1. Marijuana plants, as they begin to flower and for a period of two

months or more, produce a strong odor, offensive to many people, and detectable far beyond property boundaries if grown outdoors. Also, the strong smell of marijuana creates an attractive nuisance, alerting persons to the location of the valuable plants, and creating a risk of burglary, robbery or armed robbery;

2. The potential for burglary or robbery is high because marijuana plants are valuable. The U.S. Drug Enforcement Agency reports that each marijuana plant under various planting conditions may yield an average between one-half to two pounds in its lifetime.

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Prices for domestically produced high-grade marijuana sold illegally within Northern California can reach $2,000 to $5,000 per pound;

3. The indoor residential cultivation of marijuana has potential adverse effects to the health and safety of the occupants, including damage to the structural integrity of a building from increased moisture and mold, risk of fire and electrocution from high intensity light fixtures, chemical contamination from the use of pesticides and fertilizers;

4. There is potential for exposure to or increased usage by school-aged children from non-secured areas used for either indoor or outdoor residential cultivation of any marijuana;

5. The manufacturing of marijuana products involve the use of chemicals and solvents, and as a result, the manufacturing of hash oil concentrate, often added to edibles, drinks and liquids, carries a significant risk of explosion due to the distillation process to extract tetrahydrocannabinol;

6. Several California cities have reported negative impacts of marijuana cultivation, processing and distribution activities, including offensive odors, illegal sales and distribution of marijuana, trespassing, theft, violent robberies and robbery attempts, fire hazards, and problems associated with mold, fungus, and pests; and,

7. The California Attorney General's August 2008 Guidelines for the Security and Non-Diversion of Marijuana Grown for Medical Use recognizes that the cultivation or other concentration of marijuana in any location or premises without adequate security increases the risk that nearby homes or businesses may be negatively impacted by nuisance activity such as loitering or crime.

P. Based on the above, there is a current and immediate threat to the public health, safety, and welfare of City residents arising from the risks attributed with the cultivation, processing, manufacturing, testing, labeling, storing, distributing, sale, transportation, delivering, collectives, cooperatives, and dispensaries of marijuana, whether commercial or non-medical.

Q. In order to protect the public health, safety, and welfare, it is the

City Council’s desire to adopt this urgency Ordinance pursuant to Government Code §65858 to immediately address changes in State laws from the recent enactment of the California Control, Regulate and Tax Adult Use of Marijuana Act (Proposition 64), to establish a temporary moratorium for 45-days while the City develops a permanent ordinance with standards that expressly regulate and/or prohibit marijuana uses, operations, activities, and potential for unnecessary and costly litigation involving the interpretation of the Municipal code. The initial 45 days will permit City staff to study the matter and recommend a course of action to the City Council.

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R. Failure to adopt this moratorium would impair the orderly and effective implementation of the City’s General Plan as well as the Municipal Code’s zoning regulations and other regulations.

SECTION 3. Imposition of Temporary Moratorium on Commercial and

Non-Medical Uses, Operations, and Activities.

A. The findings and determinations in Section 2 above are true and correct.

B. Based on the foregoing, the City Council finds and declares there a

current and immediate threat to the public, health, safety, and welfare, and upon that basis has determined that an urgency Ordinance pursuant to California Government Code §65858 is warranted and shall take effect on November 21, 2016, upon adoption by a four-fifths vote.

C. From the effective date of this urgency Ordinance, and continuing

for a period of forty-five (45) days, unless later extended by the City Council pursuant to California Government Code §65858, the following are banned and shall prevail over any conflicting provision of the Simi Valley Municipal Code or other ordinances, resolutions, policies, and regulations of the City of Simi Valley:

(1) All commercial marijuana uses, operations, and activities, whether

for profit or not for profit, are prohibited in every zoning district, overlay district, specific plan or other areas within the City, including but not limited to: cultivation, processing, manufacturers, testing laboratories, labeling facilities, warehousing, storage, distributers, retailers, wholesalers, microbusinesses, deliveries, collectives, and cooperatives, whether for profit or not for profit. No business tax certificates, home occupation permits, zoning clearances, approvals or other entitlements shall be issued for these commercial or non-medical uses, operations, or activities.

(2) Smoking or ingesting marijuana uses are prohibited in lounges, businesses, microbusinesses, collectives, cooperatives, or other similar uses within the City, whether for profit or not for profit. No business tax certificates, home occupation permits, zoning clearances, approvals or other entitlements shall be issued for these marijuana uses, operations, or activities.

(3) All outdoor cultivation of personal marijuana on any land of a residence or on any vacant land within the City is prohibited. A private residence shall mean a house, townhome, condominium unit, an apartment unit, mobile home, or similar dwelling.

(4) For the purposes of this urgency Ordinance, the following terms and phrases have the following meanings:

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Dwelling. As defined in Section 9-80.020 of the Simi Valley Municipal Code. Commercial Marijuana Activity. Has same meaning as “commercial marijuana activity” definition in California Business and Profession Code §26000, and including the commercial for profit, wholesale, or not for profit cultivation, processing, manufacturing, testing, research, labeling, warehousing, storage, distributing, sale, and delivery of marijuana. Marijuana. Any or all parts of the plant Cannabis sativa Linnaeus, Cannabis indica, or Cannabis ruderalis, whether growing or not; the seeds thereof; the resin or separated resin, whether crude or purified, extracted from any part of the plant; and every compound, manufacture, salt, derivative, mixture, or preparation of the plant, its seeds or resin, including marijuana infused in foodstuff or any other ingestible or consumable product containing marijuana. The term "marijuana" shall also include "medical marijuana" as such phrase is used in the August 2008 Guidelines for the Security and Non-Diversion of Marijuana Grown for Medical Use, as may be amended from time to time, that was issued by the office of the Attorney General for the state of California or subject to the provisions of California Health and Safety Code §11362.5 (Compassionate Use Act of 1996) or California Health and Safety Code §11362.7 to §11362.83 (Medical Marijuana Program Act). Marijuana Accessories. Same meaning as “marijuana accessories” in of the California Health and Safety Code §11081.2, as any equipment, products or materials of any kind which are used, intended for use or designed for use in planting, propagating, cultivation, growing, harvesting, manufacturing, compounding, converting, producing, processing, preparing, testing, analyzing, packaging, repacking, labeling, storing, smoking, vaporizing, or containing marijuana or marijuana products into the human body. Marijuana Activity. The commercial marijuana activity, including but not limited to possession, smoking, ingesting, cultivation, processing, manufacturing, testing, labeling, storing, distributing, sale, transportation, deliveries, collectives, cooperatives, businesses, microbusinesses, collectives, and cooperatives. Marijuana Cultivation. The growing, planting, cloning, harvesting, drying, curing, grading, trimming, or processing of marijuana either indoors or outdoors. Marijuana Deliveries and Transportation. Commercial delivery and transportation of marijuana to or from locations within the City of Simi Valley for and not for profit, except transportation of medical marijuana by a qualified patient and their primary caregiver only for

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the qualified patients’ medical use in strict accordance with California Business and Professional Code §19319 and by personal marijuana by an adult in strict accordance with California Health and Safety Code §11362.3. Marijuana Dispensary. As defined in Chapter 5-41 of Simi Valley Municipal Code. Marijuana Distribution. Has same meaning as “distribution” definition in California Business and Profession Code §26000, and including any procurement, sale, and transport of marijuana and marijuana products between State-licensed entities. Marijuana Manufacture. Compound, blend, extract, infuse, or otherwise make or prepare a marijuana product. Marijuana Manufacturer. Same meaning as “manufacturer” definition in California Business and Professions Code §26000, and including a person that conducts the production, preparation, propagation, or compounding of marijuana or marijuana products directly or indirectly or by extraction methods, or independently by means of chemical synthesis, or by a combination of extraction and chemical synthesis at a fixed location that packages or repackages marijuana or marijuana products or labels or re-labels its container, that holds a State license. Marijuana Operation. Same meaning as “operation” definition in California Business and Professions Code §26000, and including any act or and commercial transfer of marijuana requires a license by the State. Marijuana Processing. Any method used to prepare marijuana or its byproducts for commercial retail and/or wholesale, including but not limited to: drying, cleaning, curing, packaging, and extraction of active ingredients to create marijuana related products and concentrates. Marijuana Products. Same meaning as “marijuana products” definition as of the Health and Safety Code §11018.1, and including marijuana that has undergone a process whereby the plant material has been transformed into a concentrate, including, but not limited to concentrated cannabis, or an edible or topical product containing marijuana or concentrated cannabis, and other ingredients. Marijuana Testing. Same meaning as “testing service” definition in California Business and Professions Code §26000, and including a laboratory, facility, or entity that offers or performs test of marijuana or marijuana products, including the equipment provided by such laboratory, facility, or entity.

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Medical Marijuana Collective or Cooperative. Any profit or not-for-profit group that is collectively or cooperatively cultivating and distributing marijuana for medical purposes is a prohibited land use in the City of Simi Valley. This collective or cooperative is also any profit or not-for-profit, including those group that is organized in the manner set forth in the August 2008 Guidelines for the Security and Non-Diversion of Marijuana Grown for Medical Use, as may be amended from time to time, that was issued by the office of the Attorney General for the State of California or subject to the provisions of California Health and Safety Code §11362.5 (Compassionate Use Act of 1996) or California Health and Safety Code §11362.7 to §11362.83 (Medical Marijuana Program Act).

D. The City Council directs staff to study necessary amendments to the Municipal Code land use regulations and other regulations within the framework of the Control, Regulate and Tax Adult Use of Marijuana Act (Proposition 64), including a prohibition of commercial marijuana uses, operations, and activities, a prohibition of marijuana smoking and ingesting at businesses, microbusinesses, and other similar public places, prohibiting outdoor marijuana cultivation on a residence’s property, regulations permitting indoor personal and medical cultivation inside a residence or accessory structure of residence.

SECTION 4. Penalty for Violation. No person, whether principal, agent,

employee or otherwise, shall violate, cause the violation of, or otherwise fail to comply with any requirement of Section 3 of this urgency Ordinance. Every act prohibited or declared unlawful, and every failure to perform an act made mandatory by said Section 3, shall constitute a misdemeanor or infraction and punishable by a fine not exceeding one thousand dollars ($1,000) or imprisonment for a period not exceeding six (6) months, or by both such fine and imprisonment, at the discretion of the City Attorney. In addition to the penalties provided in this section, any condition caused or permitted to exist in violation of any of the provisions of said Section 3 is declared a public nuisance and may be abated as set forth in Title 1 Chapter 6 of the Simi Valley Municipal Code, as well as any other manner provided for by law for the abatement of public nuisances.

SECTION 5. Severability. If any provision of this Ordinance is declared

invalid by a court of competent jurisdiction, adjudicated to a final determination, the City Council finds that said voided part is severable, that the City Council would have adopted the remainder of this Ordinance without the severed and voided part, and that the remainder of this Ordinance shall remain in full force and effect.

SECTION 6. Incompatible Provisions. To the extent any provision of this

Ordinance is incompatible with or at variance with any prior adopted ordinance or resolution, the provision of this Ordinance shall take precedence.

SECTION 7. The City Clerk shall cause this ordinance or a summary

hereof to be published in a newspaper of general circulation, published in the County of Ventura and circulated in the City, and if applicable, to be posted, in accordance with §36933 of the California Government Code; shall certify to the adoption of this

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ordinance and shall cause a certified copy of this ordinance, together with proof of publication, to be filed in the Office of the Clerk of this City.

PASSED and ADOPTED this 5th day of December 2016. Attest: __ Ky Spangler, Deputy Director/City Clerk Robert O. Huber, Mayor of the City of Simi Valley, California Approved as to Form: Approved as to Content: Lonnie J. Eldridge, City Attorney Eric J. Levitt, City Manager Peter Lyons, Director Department of Environmental Services

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PROPOSITION 64 This initiative measure is submitted to the people in accordance with the provisions of Section 8 of Article II of the California Constitution. This initiative measure amends, repeals, and adds sections to the Business and Professions Code, the Food and Agricultural Code, the Health and Safety Code, the Labor Code, the Revenue and Taxation Code, and the Water Code; therefore, existing provisions proposed to be deleted are printed in strikeout type and new provisions proposed to be added are printed in italic type to indicate that they are new.

PROPOSED LAW SECTION 1. Title. This measure shall be known and may be cited as the Control, Regulate and Tax Adult Use of Marijuana Act (“the Adult Use of Marijuana Act”). SEC. 2. Findings and Declarations. A. Currently in California, nonmedical marijuana use isunregulated, untaxed, and occurs without any consumer orenvironmental protections. The Control, Regulate and TaxAdult Use of Marijuana Act will legalize marijuana forthose over 21 years old, protect children, and establishlaws to regulate marijuana cultivation, distribution, saleand use, and will protect Californians and the environmentfrom potential dangers. It establishes the Bureau ofMarijuana Control within the Department of ConsumerAffairs to regulate and license the marijuana industry.B. Marijuana is currently legal in our state for medical useand illegal for nonmedical use. Abuse of the medicalmarijuana system in California has long been widespread,but recent bipartisan legislation signed by Governor JerryBrown is establishing a comprehensive regulatory schemefor medical marijuana. The Control, Regulate and TaxAdult Use of Marijuana Act (hereafter called the Adult Useof Marijuana Act) will consolidate and streamline regulationand taxation for both nonmedical and medical marijuana.C. Currently, marijuana growth and sale is not being taxedby the State of California, which means our state is missingout on hundreds of millions of dollars in potential taxrevenue every year. The Adult Use of Marijuana Act will taxboth the growth and sale of marijuana to generate hundredsof millions of dollars annually. The revenues will cover thecost of administering the new law and will provide fundsto: invest in public health programs that educate youth toprevent and treat serious substance abuse; train local lawenforcement to enforce the new law with a focus on DUIenforcement; invest in communities to reduce the illicitmarket and create job opportunities; and provide forenvironmental cleanup and restoration of public landsdamaged by illegal marijuana cultivation.D. Currently, children under the age of 18 can just aseasily purchase marijuana on the black market as adultscan. By legalizing marijuana, the Adult Use of MarijuanaAct will incapacitate the black market, and move marijuanapurchases into a legal structure with strict safeguardsagainst children accessing it. The Adult Use of MarijuanaAct prohibits the sale of nonmedical marijuana to those

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under 21 years old, and provides new resources to educate youth against drug abuse and train local law enforcement to enforce the new law. It bars marijuana businesses from being located within 600 feet of schools and other areas where children congregate. It establishes mandatory and strict packaging and labeling requirements for marijuana and marijuana products. And it mandates that marijuana and marijuana products cannot be advertised or marketed towards children. E. There are currently no laws governing adult usemarijuana businesses to ensure that they operate inaccordance with existing California laws. Adult use ofmarijuana may only be accessed from the unregulatedillicit market. The Adult Use of Marijuana Act sets up acomprehensive system governing marijuana businesses atthe state level and safeguards local control, allowing localgovernments to regulate marijuana-related activities, tosubject marijuana businesses to zoning and permittingrequirements, and to ban marijuana businesses by a voteof the people within a locality.F. Currently, illegal marijuana growers steal or divertmillions of gallons of water without any accountability. TheAdult Use of Marijuana Act will create strict environmentalregulations to ensure that the marijuana is grown efficientlyand legally, to regulate the use of pesticides, to preventwasting water, and to minimize water usage. The Adult Useof Marijuana Act will crack down on the illegal use of waterand punish bad actors, while providing funds to restorelands that have been damaged by illegal marijuana grows.If a business does not demonstrate they are in fullcompliance with the applicable water usage andenvironmental laws, they will have their license revoked.G. Currently, the courts are clogged with cases of nonviolent drug offenses. By legalizing marijuana, the AdultUse of Marijuana Act will alleviate pressure on the courts,but continue to allow prosecutors to charge the mostserious marijuana-related offenses as felonies, whilereducing the penalties for minor marijuana-related offensesas set forth in the act.H. By bringing marijuana into a regulated and legitimatemarket, the Adult Use of Marijuana Act creates atransparent and accountable system. This will help policecrackdown on the underground black market that currentlybenefits violent drug cartels and transnational gangs,which are making billions from marijuana trafficking andjeopardizing public safety.I. The Adult Use of Marijuana Act creates a comprehensiveregulatory structure in which every marijuana business isoverseen by a specialized agency with relevant expertise.The Bureau of Marijuana Control, housed in the Department of Consumer Affairs, will oversee the whole system andensure a smooth transition to the legal market, withlicenses issued beginning in 2018. The Department ofConsumer Affairs will also license and oversee marijuanaretailers, distributors, and microbusinesses. TheDepartment of Food and Agriculture will license and

oversee marijuana cultivation, ensuring it is environmentallysafe. The State Department of Public Health will licenseand oversee manufacturing and testing, ensuringconsumers receive a safe product. The State Board ofEqualization will collect the special marijuana taxes, andthe Controller will allocate the revenue to administer thenew law and provide the funds to critical investments.J. The Adult Use of Marijuana Act ensures the nonmedicalmarijuana industry in California will be built around smalland medium sized businesses by prohibiting large-scale

cultivation licenses for the first five years. The Adult Use of Marijuana Act also protects consumers and small businesses by imposing strict anti-monopoly restrictions for businesses that participate in the nonmedical marijuana industry. SEC. 3. Purpose and Intent. The purpose of the Adult Use of Marijuana Act is to establish a comprehensive system to legalize, control and regulate the cultivation, processing, manufacture, distribution, testing, and sale of nonmedical marijuana, including marijuana products, for use by adults 21 years and older, and to tax the commercial growth and retail sale of marijuana. It is the intent of the people in enacting this act to accomplish the following: (a) Take nonmedical marijuana production and sales outof the hands of the illegal market and bring them under aregulatory structure that prevents access by minors andprotects public safety, public health, and the environment.(b) Strictly control the cultivation, processing,manufacture, distribution, testing and sale of nonmedicalmarijuana through a system of state licensing, regulation,and enforcement.(c) Allow local governments to enforce state laws andregulations for nonmedical marijuana businesses andenact additional local requirements for nonmedicalmarijuana businesses, but not require that they do so for anonmedical marijuana business to be issued a state licenseand be legal under state law.(d) Allow local governments to ban nonmedical marijuanabusinesses as set forth in this act.(e) Require track and trace management procedures totrack nonmedical marijuana from cultivation to sale.(f) Require nonmedical marijuana to be comprehensivelytested by independent testing services for the presence ofcontaminants, including mold and pesticides, before itcan be sold by licensed businesses.(g) Require nonmedical marijuana sold by licensedbusinesses to be packaged in child-resistant containersand be labeled so that consumers are fully informed aboutpotency and the effects of ingesting nonmedical marijuana.(h) Require licensed nonmedical marijuana businesses tofollow strict environmental and product safety standardsas a condition of maintaining their license.(i) Prohibit the sale of nonmedical marijuana by businesses that also sell alcohol or tobacco.(j) Prohibit the marketing and advertising of nonmedicalmarijuana to persons younger than 21 years old or nearschools or other places where children are present.(k) Strengthen the state’s existing medical marijuanasystem by requiring patients to obtain by January 1, 2018,a new recommendation from their physician that meets thestrict standards signed into law by the Governor in 2015,and by providing new privacy protections for patients whoobtain medical marijuana identification cards as set forthin this act.(l) Permit adults 21 years and older to use, possess,purchase and grow nonmedical marijuana within definedlimits for use by adults 21 years and older as set forth inthis act.(m) Allow local governments to reasonably regulate thecultivation of nonmedical marijuana for personal use byadults 21 years and older through zoning and other local

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laws, and only to ban outdoor cultivation as set forth in this act. (n) Deny access to marijuana by persons younger than 21 years old who are not medical marijuana patients. (o) Prohibit the consumption of marijuana in a public place unlicensed for such use, including near K–12 schools and other areas where children are present. (p) Maintain existing laws making it unlawful to operate a car or other vehicle used for transportation while impaired by marijuana. (q) Prohibit the cultivation of marijuana on public lands or while trespassing on private lands. (r) Allow public and private employers to enact and enforce workplace policies pertaining to marijuana. (s) Tax the growth and sale of marijuana in a way that drives out the illicit market for marijuana and discourages use by minors, and abuse by adults. (t) Generate hundreds of millions of dollars in new state revenue annually for restoring and repairing theenvironment, youth treatment and prevention, community investment, and law enforcement.

(u) Prevent illegal production or distribution of marijuana. (v) Prevent the illegal diversion of marijuana from California to other states or countries or to the illegal market. (w) Preserve scarce law enforcement resources to prevent and prosecute violent crime. (x) Reduce barriers to entry into the legal, regulated market. (y) Require minors who commit marijuana-related offenses to complete drug prevention education or counseling and community service. (z) Authorize courts to resentence persons who are currently serving a sentence for offenses for which the penalty is reduced by the act, so long as the person does not pose a risk to public safety, and to redesignate or dismiss such offenses from the criminal records of persons who have completed their sentences as set forth in this act. (aa) Allow industrial hemp to be grown as an agricultural product, and for agricultural or academic research, and regulated separately from the strains of cannabis with higher delta-9 tetrahydrocannabinol concentrations. SEC. 4. Personal Use. SEC. 4.1. Section 11018 of the Health and Safety Code is amended to read: 11018. Marijuana. “Marijuana” means all parts of the plant Cannabis sativa L., whether growing or not; the seeds thereof; the resin extracted from any part of the plant; and every compound, manufacture, salt, derivative, mixture, or preparation of the plant, its seeds or resin. It does not include the mature stalks of the plant, fiber produced from the stalks, oil or cake made from the seeds of the plant, any other compound, manufacture, salt, derivative, mixture, or preparation of the mature stalks (except the resin extracted therefrom), fiber, oil, or cake, or the sterilized seed of the plant which is incapable of germination: (a) Industrial hemp, as defined in Section 11018.5; or

(b) The weight of any other ingredient combined with marijuana to prepare topical or oral administrations, food, drink, or other product. SEC. 4.2. Section 11018.1 is added to the Health and Safety Code, to read: 11018.1. Marijuana Products. “Marijuana products” means marijuana that has undergone a process whereby the plant material has been transformed into a concentrate, including, but not limited to, concentrated cannabis, or an edible or topical product containing marijuana or concentrated cannabis and other ingredients. SEC. 4.3. Section 11018.2 is added to the Health and Safety Code, to read: 11018.2. Marijuana Accessories. “Marijuana accessories” means any equipment, products or materials of any kind which are used, intended for use, or designed for use in planting, propagating, cultivating, growing, harvesting, manufacturing, compounding, converting, producing, processing, preparing, testing, analyzing, packaging, repackaging, storing, smoking, vaporizing, or containing marijuana, or for ingesting, inhaling, or otherwise introducing marijuana or marijuana products into the human body. SEC. 4.4. Section 11362.1 is added to the Health and Safety Code, to read: 11362.1. (a) Subject to Sections 11362.2, 11362.3, 11362.4, and 11362.45, but notwithstanding any other provision of law, it shall be lawful under state and local law, and shall not be a violation of state or local law, for persons 21 years of age or older to: (1) Possess, process, transport, purchase, obtain, or give away to persons 21 years of age or older without any compensation whatsoever, not more than 28.5 grams of marijuana not in the form of concentrated cannabis; (2) Possess, process, transport, purchase, obtain, or give away to persons 21 years of age or older without any compensation whatsoever, not more than eight grams of marijuana in the form of concentrated cannabis, including as contained in marijuana products; (3) Possess, plant, cultivate, harvest, dry, or process not more than six living marijuana plants and possess the marijuana produced by the plants; (4) Smoke or ingest marijuana or marijuana products; and (5) Possess, transport, purchase, obtain, use, manufacture, or give away marijuana accessories to persons 21 years of age or older without any compensation whatsoever. (b) Paragraph (5) of subdivision (a) is intended to meet the requirements of subsection (f) of Section 863 of Title 21 of the United States Code (21 U.S.C. Sec. 863(f)) by authorizing, under state law, any person in compliance with this section to manufacture, possess, or distribute marijuana accessories. (c) Marijuana and marijuana products involved in any way with conduct deemed lawful by this section are not contraband nor subject to seizure, and no conduct deemed lawful by this section shall constitute the basis for detention, search, or arrest. SEC. 4.5. Section 11362.2 is added to the Health and Safety Code, to read:

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11362.2. (a) Personal cultivation of marijuana under paragraph (3) of subdivision (a) of Section 11362.1 is subject to the following restrictions: (1) A person shall plant, cultivate, harvest, dry, or processplants in accordance with local ordinances, if any, adoptedin accordance with subdivision (b).(2) The living plants and any marijuana produced by theplants in excess of 28.5 grams are kept within the person’sprivate residence, or upon the grounds of that privateresidence (e.g., in an outdoor garden area), are in a lockedspace, and are not visible by normal unaided vision from apublic place.(3) Not more than six living plants may be planted,cultivated, harvested, dried, or processed within a singleprivate residence, or upon the grounds of that privateresidence, at one time.(b) (1) A city, county, or city and county may enact andenforce reasonable regulations to reasonably regulate theactions and conduct in paragraph (3) of subdivision (a) ofSection 11362.1.(2) Notwithstanding paragraph (1), no city, county, or cityand county may completely prohibit persons engaging inthe actions and conduct under paragraph (3) ofsubdivision (a) of Section 11362.1 inside a privateresidence, or inside an accessory structure to a privateresidence located upon the grounds of a private residencethat is fully enclosed and secure.(3) Notwithstanding paragraph (3) of subdivision (a) ofSection 11362.1, a city, county, or city and county maycompletely prohibit persons from engaging in actions andconduct under paragraph (3) of subdivision (a) ofSection 11362.1 outdoors upon the grounds of a privateresidence.(4) Paragraph (3) shall become inoperative upon adetermination by the California Attorney General thatnonmedical use of marijuana is lawful in the State ofCalifornia under federal law, and an act taken by a city,county, or city and county under paragraph (3) shall bedeemed repealed upon the date of such determination bythe Attorney General.(5) For purposes of this section, “private residence”means a house, an apartment unit, a mobile home, orother similar dwelling.SEC. 4.6. Section 11362.3 is added to the Health andSafety Code, to read:

11362.3. (a) Nothing in Section 11362.1 shall be construed to permit any person to: (1) Smoke or ingest marijuana or marijuana products inany public place, except in accordance with Section 26200 of the Business and Professions Code.(2) Smoke marijuana or marijuana products in a locationwhere smoking tobacco is prohibited.(3) Smoke marijuana or marijuana products within 1,000feet of a school, day care center, or youth center whilechildren are present at such a school, day care center, oryouth center, except in or upon the grounds of a privateresidence or in accordance with Section 26200 of, orChapter 3.5 (commencing with Section 19300) ofDivision 8 of, the Business and Professions Code and onlyif such smoking is not detectable by others on the groundsof such a school, day care center, or youth center whilechildren are present.

(4) Possess an open container or open package ofmarijuana or marijuana products while driving, operating,or riding in the passenger seat or compartment of a motorvehicle, boat, vessel, aircraft, or other vehicle used fortransportation.(5) Possess, smoke or ingest marijuana or marijuanaproducts in or upon the grounds of a school, day carecenter, or youth center while children are present.(6) Manufacture concentrated cannabis using a volatilesolvent, unless done in accordance with a license underChapter 3.5 (commencing with Section 19300) ofDivision 8 of, or Division 10 of, the Business andProfessions Code.(7) Smoke or ingest marijuana or marijuana productswhile driving, operating a motor vehicle, boat, vessel,aircraft, or other vehicle used for transportation.(8) Smoke or ingest marijuana or marijuana productswhile riding in the passenger seat or compartment of amotor vehicle, boat, vessel, aircraft, or other vehicle usedfor transportation except as permitted on a motor vehicle,boat, vessel, aircraft, or other vehicle used for transportation that is operated in accordance with Section 26200 of theBusiness and Professions Code and while no persons underthe age of 21 years are present.(b) For purposes of this section, “day care center” has thesame meaning as in Section 1596.76.(c) For purposes of this section, “smoke” means to inhale,exhale, burn, or carry any lighted or heated device or pipe,or any other lighted or heated marijuana or marijuanaproduct intended for inhalation, whether natural orsynthetic, in any manner or in any form. “Smoke” includesthe use of an electronic smoking device that creates anaerosol or vapor, in any manner or in any form, or the useof any oral smoking device for the purpose of circumventingthe prohibition of smoking in a place.(d) For purposes of this section, “volatile solvent” meansvolatile organic compounds, including: (1) explosive gases,such as Butane, Propane, Xylene, Styrene, Gasoline,Kerosene, 02 or H2; and (2) dangerous poisons, toxins, orcarcinogens, such as Methanol, Iso-propyl Alcohol,Methylene Chloride, Acetone, Benzene, Toluene, and Trichloro-ethylene.(e) For purposes of this section, “youth center” has thesame meaning as in Section 11353.1.(f) Nothing in this section shall be construed or interpretedto amend, repeal, affect, restrict, or preempt lawspertaining to the Compassionate Use Act of 1996.SEC. 4.7. Section 11362.4 is added to the Health and Safety Code, to read: 11362.4. (a) A person who engages in the conduct described in paragraph (1) of subdivision (a) of Section 11362.3 is guilty of an infraction punishable by no more than a one hundred dollar ($100) fine; provided, however, that persons under the age of 18 shall instead be required to complete four hours of a drug education program or counseling, and up to 10 hours of community service, over a period not to exceed 60 days once the drug education program or counseling and community service opportunity are made available to the person. (b) A person who engages in the conduct described inparagraphs (2) through (4) of subdivision (a) ofSection 11362.3 shall be guilty of an infraction punishableby no more than a two-hundred-fifty-dollar ($250) fine,

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unless such activity is otherwise permitted by state and local law; provided, however, that persons under the age of 18 shall instead be required to complete four hours of drug education or counseling, and up to 20 hours of community service, over a period not to exceed 90 days once the drug education program or counseling and community service opportunity are made available to the person. (c) A person who engages in the conduct described inparagraph (5) of subdivision (a) of Section 11362.3 shallbe subject to the same punishment as provided undersubdivision (c) or (d) of Section 11357.(d) A person who engages in the conduct described inparagraph (6) of subdivision (a) of Section 11362.3 shallbe subject to punishment under Section 11379.6.(e) A person who violates the restrictions in subdivision (a) ofSection 11362.2 is guilty of an infraction punishable byno more than a two-hundred-fifty-dollar ($250) fine.(f) Notwithstanding subdivision (e), a person under theage of 18 who violates the restrictions in subdivision (a) ofSection 11362.2 shall be punished under subdivision (a) ofSection 11358.(g) (1) The drug education program or counseling hoursrequired by this section shall be mandatory unless thecourt makes a finding that such a program or counseling isunnecessary for the person or that a drug educationprogram or counseling is unavailable.(2) The drug education program required by this sectionfor persons under the age of 18 must be free to participantsand provide at least four hours of group discussion orinstruction based on science and evidence-based principles and practices specific to the use and abuse of marijuanaand other controlled substances.(h) Upon a finding of good cause, the court may extendthe time for a person to complete the drug education orcounseling, and community service required under thissection.SEC. 4.8. Section 11362.45 is added to the Health and Safety Code, to read: 11362.45. Nothing in Section 11362.1 shall beconstrued or interpreted to amend, repeal, affect, restrict, or preempt:

(a) Laws making it unlawful to drive or operate a vehicle,boat, vessel, or aircraft, while smoking, ingesting, orimpaired by, marijuana or marijuana products, including,but not limited to, subdivision (e) of Section 23152 of theVehicle Code, or the penalties prescribed for violatingthose laws.(b) Laws prohibiting the sale, administering, furnishing, orgiving away of marijuana, marijuana products, or marijuanaaccessories, or the offering to sell, administer, furnish, orgive away marijuana, marijuana products, or marijuanaaccessories to a person younger than 21 years of age.(c) Laws prohibiting a person younger than 21 years of agefrom engaging in any of the actions or conduct otherwisepermitted under Section 11362.1.(d) Laws pertaining to smoking or ingesting marijuana ormarijuana products on the grounds of, or within, anyfacility or institution under the jurisdiction of theDepartment of Corrections and Rehabilitation or theDivision of Juvenile Justice, or on the grounds of, or within,any other facility or institution referenced in Section 4573 of the Penal Code.

(e) Laws providing that it would constitute negligence orprofessional malpractice to undertake any task whileimpaired from smoking or ingesting marijuana or marijuanaproducts.(f) The rights and obligations of public and privateemployers to maintain a drug and alcohol free workplace orrequire an employer to permit or accommodate the use,consumption, possession, transfer, display, transportation,sale, or growth of marijuana in the workplace, or affect theability of employers to have policies prohibiting the use ofmarijuana by employees and prospective employees, orprevent employers from complying with state or federallaw.(g) The ability of a state or local government agency toprohibit or restrict any of the actions or conduct otherwisepermitted under Section 11362.1 within a building owned,leased, or occupied by the state or local governmentagency.(h) The ability of an individual or private entity to prohibitor restrict any of the actions or conduct otherwise permittedunder Section 11362.1 on the individual’s or entity’sprivately owned property.(i) Laws pertaining to the Compassionate Use Act of 1996.SEC. 5. Use of Marijuana for Medical Purposes. SEC. 5.1. Section 11362.712 is added to the Health and Safety Code, to read: 11362.712. (a) Commencing on January 1, 2018, a qualified patient must possess a physician’s recommendation that complies with Article 25 (commencing with Section 2525) of Chapter 5 of Division 2 of the Business and Professions Code. Failure to comply with this requirement shall not, however, affect any of the protections provided to patients or their primary caregivers by Section 11362.5. (b) A county health department or the county’s designeeshall develop protocols to ensure that, commencing uponJanuary 1, 2018, all identification cards issued pursuantto Section 11362.71 are supported by a physician’srecommendation that complies with Article 25 (commencing with Section 2525) of Chapter 5 of Division 2 of the Business and Professions Code.SEC. 5.2. Section 11362.713 is added to the Health and Safety Code, to read: 11362.713. (a) Information identifying the names, addresses, or social security numbers of patients, their medical conditions, or the names of their primary caregivers, received and contained in the records of the State Department of Public Health and by any county public health department are hereby deemed “medical information” within the meaning of the Confidentiality of Medical Information Act (Part 2.6 (commencing with Section 56) of Division 1 of the Civil Code) and shall not be disclosed by the department or by any county public health department except in accordance with the restrictions on disclosure of individually identifiable information under the Confidentiality of Medical Information Act. (b) Within 24 hours of receiving any request to disclosethe name, address, or social security number of a patient,their medical condition, or the name of their primarycaregiver, the State Department of Public Health or anycounty public health agency shall contact the patient andinform the patient of the request and if the request wasmade in writing, a copy of the request.

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(c) Notwithstanding Section 56.10 of the Civil Code, neither the State Department of Public Health, nor any county public health agency, shall disclose, nor shall they be ordered by agency or court to disclose, the names, addresses, or social security numbers of patients, their medical conditions, or the names of their primary caregivers, sooner than the 10th day after which the patient whose records are sought to be disclosed has been contacted. (d) No identification card application system or database used or maintained by the State Department of Public Health or by any county department of public health or the county’s designee as provided in Section 11362.71 shall contain any personal information of any qualified patient, including, but not limited to, the patient’s name, address, social security number, medical conditions, or the names of their primary caregivers. Such an application system or database may only contain a unique user identification number, and when that number is entered, the only information that may be provided is whether the card is valid or invalid. SEC. 5.3. Section 11362.755 of the Health and Safety Code is amended to read: 11362.755. (a) The department shall establishapplication and renewal fees for persons seeking to obtain or renew identification cards that are sufficient to cover the expenses incurred by the department, including the startup cost, the cost of reduced fees for Medi-Cal beneficiaries in accordance with subdivision (b), the cost of identifying and developing a cost-effective Internet Web-based system, and the cost of maintaining the 24-hour toll-free telephone number. Each county health department or the county’s designee may charge an additional a fee for all costs incurred by the county or the county’s designee for administering the program pursuant to this article.

(b) In no event shall the amount of the fee charged by a county health department exceed one hundred dollars ($100) per application or renewal. (b) (c) Upon satisfactory proof of participation and eligibility in the Medi-Cal program, a Medi-Cal beneficiary shall receive a 50 percent reduction in the fees established pursuant to this section. (d) Upon satisfactory proof that a qualified patient, or the legal guardian of a qualified patient under the age of 18, is a medically indigent adult who is eligible for and participates in the County Medical Services Program, the fee established pursuant to this section shall be waived. (e) In the event the fees charged and collected by a county health department are not sufficient to pay for the administrative costs incurred in discharging the county health department’s duties with respect to the mandatory identification card system, the Legislature, upon request by the county health department, shall reimburse the county health department for those reasonable administrative costs in excess of the fees charged and collected by the county health department. SEC. 5.4. Section 11362.84 is added to the Health and Safety Code, to read: 11362.84. The status and conduct of a qualified patient who acts in accordance with the Compassionate Use Act shall not, by itself, be used to restrict or abridge custodial or parental rights to minor children in any action orproceeding under the jurisdiction of family or juvenilecourt.

SEC. 5.5. Section 11362.85 is added to the Health and Safety Code, to read: 11362.85. Upon a determination by the California Attorney General that the federal schedule of controlled substances has been amended to reclassify or declassify marijuana, the Legislature may amend or repeal the provisions of the Health and Safety Code, as necessary, to conform state law to such changes in federal law. SEC. 6. Marijuana Regulation and Safety. SEC. 6.1. Division 10 (commencing with Section26000) is added to the Business and Professions Code, to read:

DIVISION 10. MARIJUANA Chapter 1. General provisions and definitions

26000. (a) The purpose and intent of this division is to establish a comprehensive system to control and regulate the cultivation, distribution, transport, storage,manufacturing, processing, and sale of nonmedical marijuana and marijuana products for adults 21 years of age and over.

(b) In the furtherance of subdivision (a), this division expands the power and duties of the existing state agencies responsible for controlling and regulating the medical cannabis industry under Chapter 3.5 (commencing with Section 19300) of Division 8 to include the power and duty to control and regulate the commercial nonmedical marijuana industry. (c) The Legislature may, by majority vote, enact laws to implement this division, provided such laws are consistent with the purposes and intent of the Control, Regulate and Tax Adult Use of Marijuana Act. 26001. For purposes of this division, the following definitions shall apply: (a) “Applicant” means the following: (1) The owner or owners of a proposed licensee. “Owner” means all persons having (A) an aggregate ownership interest (other than a security interest, lien, or encumbrance) of 20 percent or more in the licensee and (B) the power to direct or cause to be directed, the management or control of the licensee. (2) If the applicant is a publicly traded company, “owner” includes the chief executive officer and any member of the board of directors and any person or entity with an aggregate ownership interest in the company of 20 percent or more. If the applicant is a nonprofit entity, “owner” means both the chief executive officer and any member of the board of directors. (b) “Bureau” means the Bureau of Marijuana Control within the Department of Consumer Affairs. (c) “Child resistant” means designed or constructed to be significantly difficult for children under five years of age to open, and not difficult for normal adults to use properly. (d) “Commercial marijuana activity” includes the cultivation, possession, manufacture, distribution, processing, storing, laboratory testing, labeling, transportation, distribution, delivery or sale of marijuana and marijuana products as provided for in this division. (e) “Cultivation” means any activity involving the planting, growing, harvesting, drying, curing, grading, or trimming of marijuana.

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(f) “Customer” means a natural person 21 years of age or over. (g) “Day care center” shall have the same meaning as in Section 1596.76 of the Health and Safety Code. (h) “Delivery” means the commercial transfer of marijuana or marijuana products to a customer. “Delivery” also includes the use by a retailer of any technology platform owned and controlled by the retailer, or independently licensed under this division, that enables customers to arrange for or facilitate the commercial transfer by a licensed retailer of marijuana or marijuana products. (i) “Director” means the Director of the Department of Consumer Affairs. (j) “Distribution” means the procurement, sale, and transport of marijuana and marijuana products between entities licensed pursuant to this division. (k) “Fund” means the Marijuana Control Fund established pursuant to Section 26210. (l) “Kind” means applicable type or designation regarding a particular marijuana variant or marijuana product type, including, but not limited to, strain name or other grower trademark, or growing area designation. (m) “License” means a state license issued under this division. (n) “Licensee” means any person or entity holding a license under this division. (o) “Licensing authority” means the state agencyresponsible for the issuance, renewal, or reinstatement of

the license, or the state agency authorized to takedisciplinary action against the licensee. (p) “Local jurisdiction” means a city, county, or city and county. (q) “Manufacture” means to compound, blend, extract, infuse, or otherwise make or prepare a marijuana product. (r) “Manufacturer” means a person that conducts the production, preparation, propagation, or compounding of marijuana or marijuana products either directly or indirectly or by extraction methods, or independently by means of chemical synthesis, or by a combination of extraction and chemical synthesis at a fixed location that packages or repackages marijuana or marijuana products or labels or re-labels its container, that holds a state license pursuant to this division. (s) “Marijuana” has the same meaning as in Section 11018 of the Health and Safety Code, except that it does not include marijuana that is cultivated, processed,transported, distributed, or sold for medical purposes under Chapter 3.5 (commencing with Section 19300) of Division 8.

(t) “Marijuana accessories” has the same meaning as in Section 11018.2 of the Health and Safety Code. (u) “Marijuana products” has the same meaning as in Section 11018.1 of the Health and Safety Code, except that it does not include marijuana products manufactured, processed, transported, distributed, or sold for medical purposes under Chapter 3.5 (commencing withSection 19300) of Division 8.

(v) “Nursery” means a licensee that produces only clones, immature plants, seeds, and other agricultural products used specifically for the planting, propagation, andcultivation of marijuana.

(w) “Operation” means any act for which licensure is required under the provisions of this division, or any commercial transfer of marijuana or marijuana products. (x) “Package” means any container or receptacle used for holding marijuana or marijuana products. (y) “Person” includes any individual, firm, copartnership, joint venture, association, corporation, limited liability company, estate, trust, business trust, receiver, syndicate, or any other group or combination acting as a unit, and the plural as well as the singular. (z) “Purchaser” means the customer who is engaged in a transaction with a licensee for purposes of obtaining marijuana or marijuana products. (aa) “Sell,” “sale,” and “to sell” include any transaction whereby, for any consideration, title to marijuana is transferred from one person to another, and includes the delivery of marijuana or marijuana products pursuant to an order placed for the purchase of the same and soliciting or receiving an order for the same, but does not include the return of marijuana or marijuana products by a licensee to the licensee from whom such marijuana or marijuana product was purchased. (bb) “Testing service” means a laboratory, facility, or entity in the state, that offers or performs tests of marijuana or marijuana products, including the equipment provided by such laboratory, facility, or entity, and that is both of the following: (1) Accredited by an accrediting body that is independent from all other persons involved in commercial marijuana activity in the state. (2) Registered with the State Department of Public Health. (cc) “Unique identifier” means an alphanumeric code or designation used for reference to a specific plant on a licensed premises. (dd) “Unreasonably impracticable” means that the measures necessary to comply with the regulations require such a high investment of risk, money, time, or any other resource or asset, that the operation of a marijuana establishment is not worthy of being carried out in practice by a reasonably prudent business person. (ee) “Youth center” shall have the same meaning as in Section 11353.1 of the Health and Safety Code.

Chapter 2. administration 26010. (a) The Bureau of Medical Marijuana Regulation established in Section 19302 is hereby renamed the Bureau of Marijuana Control. The director shall administer and enforce the provisions of this division in addition to the provisions of Chapter 3.5 (commencing with Section 19300) of Division 8. The director shall have the same power and authority as provided by subdivisions (b) and (c) of Section 19302.1 for purposes of this division. (b) The bureau and the director shall succeed to and are vested with all the duties, powers, purposes, responsibilities, and jurisdiction vested in the Bureau of Medical Marijuana Regulation under Chapter 3.5 (commencing with Section 19300) of Division 8. (c) In addition to the powers, duties, purposes, responsibilities, and jurisdiction referenced in subdivision (b), the bureau shall heretofore have the power, duty, purpose, responsibility, and jurisdiction to regulate commercial marijuana activity as provided in this division.

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(d) Upon the effective date of this section, whenever“Bureau of Medical Marijuana Regulation” appears in anystatute, regulation, or contract, or in any other code, itshall be construed to refer to the bureau.26011. Neither the chief of the bureau nor any member of the Marijuana Control Appeals Panel established under Section 26040 shall do any of the following: (a) Receive any commission or profit whatsoever, directlyor indirectly, from any person applying for or receiving anylicense or permit under this division or Chapter 3.5 (commencing with Section 19300) of Division 8.(b) Engage or have any interest in the sale or any insurancecovering a licensee’s business or premises.(c) Engage or have any interest in the sale of equipmentfor use upon the premises of a licensee engaged incommercial marijuana activity.(d) Knowingly solicit any licensee for the purchase oftickets for benefits or contributions for benefits.(e) Knowingly request any licensee to donate or receivemoney, or any other thing of value, for the benefit of anyperson whatsoever.26012. (a) It being a matter of statewide concern, except as otherwise authorized in this division: (1) The Department of Consumer Affairs shall have theexclusive authority to create, issue, renew, discipline,suspend, or revoke licenses for the transportation, storageunrelated to manufacturing activities, distribution, andsale of marijuana within the state.(2) The Department of Food and Agriculture shalladminister the provisions of this division related to andassociated with the cultivation of marijuana. TheDepartment of Food and Agriculture shall have the authority to create, issue, and suspend or revoke cultivation licensesfor violations of this division.(3) The State Department of Public Health shall administer the provisions of this division related to and associatedwith the manufacturing and testing of marijuana. TheState Department of Public Health shall have the authorityto create, issue, and suspend or revoke manufacturing andtesting licenses for violations of this division.(b) The licensing authorities and the bureau shall have theauthority to collect fees in connection with activities theyregulate concerning marijuana. The bureau may createlicenses in addition to those identified in this division thatthe bureau deems necessary to effectuate its duties underthis division.(c) Licensing authorities shall begin issuing licenses underthis division by January 1, 2018.26013. (a) Licensing authorities shall make and prescribe reasonable rules and regulations as may be necessary to implement, administer and enforce their respective duties under this division in accordance with Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. Such rules and regulations shall be consistent with the purposes and intent of the Control, Regulate and Tax Adult Use of Marijuana Act. (b) Licensing authorities may prescribe, adopt, andenforce any emergency regulations as necessary toimplement, administer and enforce their respective dutiesunder this division. Any emergency regulation prescribed,adopted or enforced pursuant to this section shall beadopted in accordance with Chapter 3.5 (commencing

with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, and, for purposes of that chapter, including Section 11349.6 of the Government Code, the adoption of the regulation is an emergency and shall be considered by the Office of Administrative Law as necessary for the immediate preservation of the public peace, health and safety, and general welfare. (c) Regulations issued under this division shall benecessary to achieve the purposes of this division, basedon best available evidence, and shall mandate onlycommercially feasible procedures, technology, or otherrequirements, and shall not unreasonably restrain or inhibitthe development of alternative procedures or technology toachieve the same substantive requirements, nor shall suchregulations make compliance unreasonably impracticable.26014. (a) The bureau shall convene an advisory committee to advise the bureau and licensing authorities on the development of standards and regulations pursuant to this division, including best practices and guidelines that protect public health and safety while ensuring a regulated environment for commercial marijuana activity that does not impose such unreasonably impracticable barriers so as to perpetuate, rather than reduce and eliminate, the illicit market for marijuana. (b) The advisory committee members shall include, butnot be limited to, representatives of the marijuana industry,representatives of labor organizations, appropriate stateand local agencies, public health experts, and othersubject matter experts, including representatives from theDepartment of Alcoholic Beverage Control, with expertisein regulating commercial activity for adult-use intoxicatingsubstances. The advisory committee members shall bedetermined by the director.(c) Commencing on January 1, 2019, the advisorycommittee shall publish an annual public report describingits activities including, but not limited to, therecommendations the advisory committee made to thebureau and licensing authorities during the immediatelypreceding calendar year and whether thoserecommendations were implemented by the bureau orlicensing authorities.26015. A licensing authority may make or cause to be made such investigation as it deems necessary to carry out its duties under this division. 26016. For any hearing held pursuant to this division, except a hearing held under Chapter 4 (commencing with Section 26040), a licensing authority may delegate the power to hear and decide to an administrative law judge. Any hearing before an administrative law judge shall be pursuant to the procedures, rules, and limitations prescribed in Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code. 26017. In any hearing before a licensing authority pursuant to this division, the licensing authority may pay any person appearing as a witness at the hearing at the request of the licensing authority pursuant to a subpoena,