SB306INTRODUCED
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SB306
UPZNGXG-1
By Senator Melson
RFD: Agriculture, Conservation, and Forestry
First Read: 09-Apr-24
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5 UPZNGXG-1 04/09/2024 PMG (L)tgw 2024-1326
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First Read: 09-Apr-24
SYNOPSIS:
Under existing law, the Alabama Medical Cannabis
Commission is responsible for the regulation,
licensure, and enforcement of all aspects of the
processing and dispensing of medical cannabis, while
the Alabama Department of Agriculture and Industries
shares responsibility with the commission for the
regulation and enforcement of the cultivation of
cannabis to be used for medical cannabis products.
This bill would provide that the regulation,
licensure, and enforcement functions relating to the
cultivation of cannabis are duties of the Alabama
Medical Cannabis Commission and would require the
Alabama Department of Agriculture and Industries to
cooperate with the commission in carrying out these
functions.
Under existing law, the Alabama Medical Cannabis
Commission may issue five integrated facility licenses,
which allows for cultivation, processing, and
dispensing of medical cannabis.
This bill would specify a three-step process for
the awarding of integrated facility licences. The first
step would require a panel appointed by the Alabama
Securities Commission to determine if license
applicants meet certain basic eligibility requirements
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applicants meet certain basic eligibility requirements
for licensure. The second step would require the review
panel to determine the readiness of the cultivation and
dispensing operations if a license was to be awarded.
The third step would require the Alabama Medical
Cannabis Commission members to score the pool of
remaining eligible applicants on a number of criteria
to ultimately determine the awarding of the licenses.
This bill would also provide greater specificity
to the eligibility requirements for integrated license
facility licensure.
Under existing law, a medical cannabis license
may be transferred in certain circumstances.
This bill would prohibit the transfer of an
integrated facility license.
A BILL
TO BE ENTITLED
AN ACT
Relating to medical cannabis; to amend Sections
20-2A-3, 20-2A-50, 20-2A-51, 20-2A-52, 20-2A-53, 20-2A-57,
20-2A-59, 20-2A-62, and 20-2A-63, Code of Alabama 1975, to
provide that the Alabama Medical Cannabis Commission is
primarily responsible for the regulation, licensure, and
enforcement of cannabis cultivation; to amend Section
20-2A-58, Code of Alabama 1975, to prohibit the transfer of an
integrated facility license; and to amend Section 20-2A-67,
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integrated facility license; and to amend Section 20-2A-67,
Code of Alabama 1975, to provide for a three-step process in
the awarding of integrated facility licenses and provide
greater specificity in the procedure and in the eligibility
requirements for licensure.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. It is the intent of this act to:
(1) Ensure that the process for selecting integrated
facility licenses adheres to the original intent of Act
2021-450, now codified as Chapter 2A of Title 20, Code of
Alabama 1975;
(2) Account for every individual and entity who may
benefit financially from an integrated facility license; and
(3) Provide full transparency to the integrated
facility license selection process.
Section 2. Sections 20-2A-3, 20-2A-50, 20-2A-51,
20-2A-52, 20-2A-53, 20-2A-57, 20-2A-58, 20-2A-59, 20-2A-62,
20-2A-63, and 20-2A-67, Code of Alabama 1975, are amended to
read as follows:
"§20-2A-3
As used in this chapter, the following terms have the
following meanings:
(1) APPLICANT. The entity or individual seeking a
license under Article 4.
(2) BOARD. The State Board of Medical Examiners.
(3) CANNABIS. a. Except as provided in paragraph b.,
all parts of any plant of the genus cannabis, whether growing
or not, including the seeds, extractions of any kind from any
part of the plant, and every compound, derivative, mixture,
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part of the plant, and every compound, derivative, mixture,
product, or preparation of the plant.
b. The term does not include industrial hemp or hemp
regulated under Article 11 of Chapter 8 of Title 2.
(4) COMMISSION. The Alabama Medical Cannabis Commission
created pursuant to Section 20-2A-20.
(5) CULTIVATOR. An entity licensed by the Department of
Agriculture and Industries commission under Section 20-2A-62
authorized to grow cannabis pursuant to Article 4.
(6) DAILY DOSAGE. The total amount of one or more
cannabis derivatives, including, but not limited to,
cannabidiol and tetrahydrocannabinol, which may be present in
a medical cannabis product that may be ingested by a
registered qualified patient during a 24-hour period, as
determined by a registered certifying physician.
(7) DEPARTMENT. The Department of Agriculture and
Industries.
(8) DISPENSARY. An entity licensed by the commission
under Section 20-2A-64 authorized to dispense and sell medical
cannabis at dispensing sites to registered qualified patients
and registered caregivers pursuant to Article 4.
(9) DISPENSING SITE. A site operated by a dispensary
licensee or an integrated facility licensee pursuant to
Article 4.
(10) ECONOMIC INTEREST. The rights to either the
capital or profit interests of an applicant or licensee or, if
the applicant or licensee is a corporation, the rights to some
portion of all classes of outstanding stock in the
corporation.
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corporation.
(11) FACILITY or MEDICAL CANNABIS FACILITY. Any
facility, or land associated with a facility, of a licensee.
(12) INTEGRATED FACILITY. An entity licensed under
Section 20-2A-67 authorized to perform the functions of a
cultivator, processor, secure transporter, and dispensary
pursuant to Article 4.
(13) LICENSEE. A cultivator, processor, secure
transporter, state testing laboratory, dispensary, or
integrated facility licensed by the commission under Article
4.
(14) MEDICAL CANNABIS. a. A medical grade product in
the form of any of the following, as determined by rule by the
commission, that contains a derivative of cannabis for medical
use by a registered qualified patient pursuant to this
chapter:
1. Oral tablet, capsule, or tincture.
2. Non-sugarcoated gelatinous cube, gelatinous
rectangular cuboid, or lozenge in a cube or rectangular cuboid
shape.
3. Gel, oil, cream, or other topical preparation.
4. Suppository.
5. Transdermal patch.
6. Nebulizer.
7. Liquid or oil for administration using an inhaler.
b. The term does not include any of the following:
1. Raw plant material.
2. Any product administered by smoking, combustion, or
vaping.
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vaping.
3. A food product that has medical cannabis baked,
mixed, or otherwise infused into the product, such as cookies
or candies.
(15) MEDICAL CANNABIS CARD. A valid card issued
pursuant to Section 20-2A-36.
(16) MEDICAL USE or USE OF MEDICAL CANNABIS or USE
MEDICAL CANNABIS. The acquisition, possession, use, delivery,
transfer, or administration of medical cannabis authorized by
this chapter. The term does not include possession, use, or
administration of cannabis that was not purchased or acquired
from a licensed dispensary.
(17) PACKAGE. Any container that a processor may use
for enclosing and containing medical cannabis. The term does
not include any carry-out bag or other similar container.
(18) PATIENT REGISTRY. The Alabama Medical Cannabis
Patient Registry System that is an electronic integrated
system that tracks physician certifications, patient
registrations, medical cannabis cards, the daily dosage and
type of medical cannabis recommended to qualified patients by
registered certifying physicians, and the dates of sale,
amounts, and types of medical cannabis that were purchased by
registered qualified patients at licensed dispensaries.
(19) PHYSICIAN CERTIFICATION. A registered certifying
physician's authorization for a registered qualified patient
to use medical cannabis.
(20) PROCESSOR. An entity licensed by the commission
under Section 20-2A-63 authorized to purchase cannabis from a
cultivator and extract derivatives from the cannabis to
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cultivator and extract derivatives from the cannabis to
produce a medical cannabis product or products for sale and
transfer in packaged and labeled form to a dispensing site
pursuant to Article 4.
(21) QUALIFYING MEDICAL CONDITION. Any of the following
conditions or symptoms of conditions, but only after
documentation indicates that conventional medical treatment or
therapy has failed unless current medical treatment indicates
that use of medical cannabis is the standard of care:
a. Autism Spectrum Disorder (ASD).
b. Cancer-related cachexia, nausea or vomiting, weight
loss, or chronic pain.
c. Crohn's Disease.
d. Depression.
e. Epilepsy or a condition causing seizures.
f. HIV/AIDS-related nausea or weight loss.
g. Panic disorder.
h. Parkinson's disease.
i. Persistent nausea that is not significantly
responsive to traditional treatment, except for nausea related
to pregnancy, cannabis-induced cyclical vomiting syndrome, or
cannabinoid hyperemesis syndrome.
j. Post Traumatic Stress Disorder (PTSD).
k. Sickle Cell Anemia.
l. Spasticity associated with a motor neuron disease,
including Amyotrophic Lateral Sclerosis.
m. Spasticity associated with Multiple Sclerosis or a
spinal cord injury.
n. A terminal illness.
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n. A terminal illness.
o. Tourette's Syndrome.
p. A condition causing chronic or intractable pain in
which conventional therapeutic intervention and opiate therapy
is contraindicated or has proved ineffective.
(22) REGISTERED CAREGIVER. An individual who meets the
requirements described in subsection (c) of Section 20-2A-30
and is authorized to acquire and possess medical cannabis and
to assist one or more registered qualified patients with the
use of medical cannabis pursuant to this chapter.
(23) REGISTERED CERTIFYING PHYSICIAN. A physician
authorized by the State Board of Medical Examiners to certify
patients for the use of medical cannabis under this chapter.
(24) REGISTERED QUALIFIED PATIENT. Either of the
following:
a. An adult who meets the requirements described in
subsection (a) of Section 20-2A-30 and is authorized to
acquire, possess, and use medical cannabis pursuant to this
chapter.
b. A minor who meets the requirements described in
subsection (b) of Section 20-2A-30 and is authorized to use
medical cannabis pursuant to this chapter with the assistance
of a registered caregiver.
(25) SECURE TRANSPORTER. An entity licensed by the
commission under Section 20-2A-65 authorized to transport
cannabis or medical cannabis from one licensed facility or
site to another licensed facility or site.
(26) STATE TESTING LABORATORY. An entity licensed under
Section 20-2A-66 authorized to test cannabis and medical
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Section 20-2A-66 authorized to test cannabis and medical
cannabis to ensure the product meets safety qualifications
required under this chapter.
(27) STATEWIDE SEED-TO-SALE TRACKING SYSTEM. The
tracking system established pursuant to Section 20-2A-54 that
tracks all cannabis and medical cannabis in the state.
(28) UNIVERSAL STATE SYMBOL. The image established by
the commission pursuant to Section 20-2A-53 made available to
processors which indicates the package contains medical
cannabis."
"§20-2A-50
(a) The state hereby preemptively regulates medical
cannabis from seed to sale seed-to-sale and shall reasonably
regulate and control all aspects of the medical cannabis
industry to meet the intent of this chapter. All functions and
activities relating to the production of medical cannabis in
the state shall be licensed, and licenses shall be granted to
integrated facilities, as well as to independent entities in
the following categories: Cultivator, processor, dispensary,
secure transporter, and testing laboratory.
(b) The commission shall license ,and regulate, and
enforce all aspects of medical cannabis under this article ,
excluding cultivation . The Department of Agriculture and
Industries shall license and regulate the cultivation of
cannabis. For integrated facility licenses, the commission and
the department shall enter into a memorandum of understanding
relating to the sharing of regulatory and licensing and
enforcement authority over licensees with regard to the
cultivation function The commission may seek and shall receive
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cultivation function The commission may seek and shall receive
the cooperation of the Department of Agriculture and
Industries in the regulation and enforcement of this article.
The department may recover from the commission the
department's costs of cooperation ."
"§20-2A-51
(a) Where the commission is authorized under this
article to determine the number of licenses of a specific
license category the commission will grant, or increase the
number of licenses of a specific license category to grant,
the commission shall consider the population of the state, the
number of active registered qualified patients, market demand,
the unemployment rate, the need for agricultural and other
business opportunities in communities, access to health care,
infrastructure, and other factors the commission deems
relevant in providing the greatest benefits to the residents
of this state and taking into account the racial and economic
makeup of the state.
(b) The commission , and where applicable the
department, shall ensure that at least one-fourth of all
licenses, or in the case of Section 20-2A-67, one-fifth of all
licenses, to the extent there is an applicant or applicants
that are qualified under Section 20-2A-67, are awarded to
business entities at least 51 percent of which are owned by
members of a minority group or, in the case of a corporation,
at least 51 percent of the shares of the corporation are owned
by members of a minority group, and are managed and controlled
by members of a minority group in its daily operations. For
purposes of this subsection, "minority group" means
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purposes of this subsection, "minority group" means
individuals of African American, Native American, Asian, or
Hispanic descent.
(c)(1) Notwithstanding any other provision of this
chapter to the contrary, the commission shall not permit a
dispensary to operate a dispensing site in any municipality or
unincorporated area of a county unless the municipality or
county has authorized the operation of dispensing sites within
its boundaries, as provided in subdivision (2).
(2) Any county commission, by resolution, may authorize
the operation of dispensing sites in the unincorporated areas
of the county, and the governing body of any municipality, by
ordinance, may authorize the operation of dispensing sites
within the corporate limits of the municipality. The county
commission or municipal governing body shall notify the
commission not more than seven calendar days after adopting
the resolution or ordinance.
(3) This subsection does not prohibit a municipality
from adopting zoning ordinances restricting the operation of
dispensing sites within its corporate limits."
"§20-2A-52
(a) The commission , and the department with regard to
cultivation facilities, shall have all powers necessary and
proper to fully and effectively oversee the operation of
medical cannabis facilities licensed pursuant to this article,
including the authority to do all of the following:
(1) Investigate applicants for licenses, determine the
eligibility for licenses, and grant licenses to applicants in
accordance with this article and the rules.
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accordance with this article and the rules.
(2) Investigate all individuals employed by licensees.
(3) At any time, through its investigators, agents, or
auditors, without a warrant and without notice to the
licensee, enter the premises, offices, facilities, or other
places of business of a licensee, if evidence of compliance or
noncompliance with this article or rules is likely to be found
and consistent with constitutional limitations, for the
following purposes:
a. To inspect and examine all premises of licensees.
b. To inspect and examine relevant records of the
licensee and, if the licensee fails to cooperate with an
investigation, impound, seize, assume physical control of, or
summarily remove from the premises all books, ledgers,
documents, writings, photocopies, correspondence, records, and
videotapes, including electronically stored records, money
receptacles, or equipment in which the records are stored.
c. To inspect the person , and inspect or examine
personal effects of an individual who holds a license, while
that individual is present in a medical cannabis facility of
the licensee.
d. To investigate alleged violations of this article.
(4) Investigate alleged violations of this article or
rules and take appropriate disciplinary action against a
licensee.
(5) Require all relevant records of licensees,
including financial or other statements, to be kept on the
premises authorized for operation of the licensee or in the
manner prescribed by the commission.
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manner prescribed by the commission.
(6) Eject, or exclude or authorize the ejection or
exclusion of, an individual from the premises of a licensee if
the individual violates this article, rules, or final orders
of the commission; provided, however, the propriety of the
ejection or exclusion is subject to a subsequent hearing by
the commission.
(7) Conduct periodic audits of licensees.
(8) Take disciplinary action as the commission
considers appropriate to prevent practices that violate this
article and rules.
(9) Take any other reasonable or appropriate action to
enforce this article and rules.
(b) The commission and department shall adopt rules
addressing the frequency of conducting periodic inspections
and audits of respective licensees.
(c) The commission may enter into one or more memoranda
of understanding with law enforcement agencies to assist with
enforcement of this article.
(d) The commission and department may seek and shall
receive the cooperation and assistance of the Alabama State
Law Enforcement Agency in conducting criminal background
checks and in fulfilling its responsibilities under this
article. The Alabama State Law Enforcement Agency may recover
its costs of cooperation under this article.
(e) The commission and department shall assist any
prosecuting agency in the investigation or prosecution of a
violation of a controlled substances law.
(f) Nothing in this article shall affect the authority
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(f) Nothing in this article shall affect the authority
of the Alabama Department of Environmental Management to
administer and enforce any existing law over which the Alabama
Department of Environmental Management has jurisdiction."
"§20-2A-53
(a) The commission , and the department with regard to
cultivation, shall adopt rules as necessary to implement,
administer, and enforce this article in a timely manner that
allows persons to begin applying for a license by September 1,
2022. Rules must ensure safety, security, and integrity of the
operation of medical cannabis facilities , that do all of the
following for each category of license:
(1) Establish operating standards to ensure the health,
safety, and security of the public and the integrity of
medical cannabis facility operations.
(2) Require a minimum of two million dollars
($2,000,000) of liability and casualty insurance and establish
minimum levels of other financial guarantees, if appropriate,
that licensees must maintain.
(3) Establish qualifications and restrictions for
individuals participating in or involved with operating
medical cannabis facilities.
(4) Establish an on-site inspection process to be
conducted at each facility of an applicant prior to being
issued a license, as well as ongoing on-site inspections of
the facilities of a licensee.
(5) Establish standards or requirements to ensure
cannabis and medical cannabis remain secure at all times,
including, but not limited to, requirements that all
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including, but not limited to, requirements that all
facilities of licensees remain securely enclosed and locked as
appropriate.
(6) Subject to Section 20-2A-66, establish testing
standards, procedures, and requirements for medical cannabis
sold at dispensaries.
(7) Provide for the levy and collection of fines for a
violation of this article or rules.
(8) Establish annual license fees for each type of
license, provided the fee shall be not less than ten thousand
dollars ($10,000) and not more than fifty thousand dollars
($50,000), depending on the category of license.
(9) Establish quality control standards, procedures,
and requirements.
(10) Establish chain of custody standards, procedures,
and requirements.
(11) In compliance with Chapters 27 and 30 of Title 22,
establish standards, procedures, and requirements for waste
product storage and disposal and chemical storage.
(12) Establish standards, procedures, and requirements
for securely and safely transporting medical cannabis between
facilities.
(13) Establish standards, procedures, and requirements
for the storage of cannabis and medical cannabis.
(14) Subject to Section 20-2A-63, establish packaging
and labeling standards, procedures, and requirements for
medical cannabis sold at dispensaries.
(15) Establish marketing and advertising restrictions
for medical cannabis products and medical cannabis facilities.
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for medical cannabis products and medical cannabis facilities.
(16) Establish standards and procedures for the
renewal, revocation, suspension, and nonrenewal of licenses.
(b) The commission, by rule, shall design a universal
state symbol that is a color image and made available to
licensed processors to include on all packages of medical
cannabis, as required under Section 20-2A-63."
"§20-2A-57
(a) If any of the following occurs, the commission may
deny, suspend, revoke, or restrict a license:
(1) An applicant or licensee fails to comply with this
article or rules.
(2) A licensee no longer meets the eligibility
requirements for a license under this article.
(3) An applicant or licensee fails to provide
information the commission requests to assist in any
investigation, inquiry, or commission hearing.
(b) The commission may impose civil fines of up to five
thousand dollars ($5,000) against an individual and up to
twenty-five thousand dollars ($25,000) or an amount equal to
the daily gross receipts, whichever is greater, against a
licensee for each violation of this article, rules, or an
order of the commission. Assessment of a civil fine under this
subsection is not a bar to the investigation, arrest,
charging, or prosecution of an individual for any other
violation of this article and is not grounds to suppress
evidence in any criminal prosecution that arises under this
article or any other law of this state.
(c) The commission shall comply with the hearing
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(c) The commission shall comply with the hearing
procedures of the Administrative Procedure Act when denying,
revoking, suspending, or restricting a license or imposing a
fine. The commission may suspend a license without notice or
hearing upon a determination that the safety or health of
registered qualified patients, registered caregivers, or
employees is jeopardized by continuing a facility's operation.
If the commission suspends a license under this subsection
without notice or hearing, a prompt post-suspension hearing
must be held to determine if the suspension should remain in
effect. The suspension may remain in effect until the
commission determines that the cause for suspension has been
abated. The commission may revoke the license or approve a
transfer or sale of the license upon a determination that the
licensee has not made satisfactory progress toward abating the
hazard.
(d) Any party aggrieved by an action of the commission
suspending, revoking, restricting, or refusing to renew a
license, or imposing a fine, shall be given a hearing before
the commission upon request. A request for a hearing must be
made to the commission in writing within 21 days after service
of notice of the action of the commission. Notice of the
action of the commission must be served either by personal
delivery or by certified mail, postage prepaid, to the
aggrieved party. Notice served by certified mail is considered
complete on the business day following the date of the
mailing.
(e) The commission may conduct investigative and
contested case hearings; issue subpoenas for the attendance of
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contested case hearings; issue subpoenas for the attendance of
witnesses; issue subpoenas duces tecum for the production of
books, ledgers, records, memoranda, electronically retrievable
data, and other pertinent documents; and administer oaths and
affirmations to witnesses as appropriate to exercise and
discharge the powers and duties of the commission under this
article.
(f) Any person aggrieved by an action of the commission
or the department under this article, within 30 days after
receiving notice of the action, may appeal the action to the
circuit court in the county where the commission or department
is located."
"§20-2A-58
(a) Each license is exclusive to the licensee. A
license, and any interest in or rights under a license, and
any ownership interest or other beneficial interest in a
licensed entity, may not be sold, transferred, assigned,
conveyed, or otherwise disposed of in any manner, in whole or
in part, voluntarily or involuntarily, directly or indirectly,
except upon application to and approval of the commission.
(b) A nonrefundable application fee of two thousand
five hundred dollars ($2,500) shall be paid to the commission
at the time of filing any transfer request under subsection
(a).
(c) The attempted transfer, sale, or other conveyance
of an interest or right in a license, or transfer of an
ownership interest or other beneficial interest in a licensed
entity, without the approval of the commission, shall be
grounds for suspension or revocation of the license or for
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grounds for suspension or revocation of the license or for
other sanction considered appropriate by the commission.
(d) Notwithstanding subsections (a) through (c), an
integrated facility license may not be transferred. "
"§20-2A-59
(a) The commission, prior to appointment, employment,
or service for a licensee, shall require all officers,
employees, contractors, and other individuals performing work
of any character who would have access to cannabis, a medical
cannabis facility, or related equipment or supplies , to submit
to a state and national criminal background check. The
commission shall determine the manner in which fingerprints of
the individuals shall be submitted to the Alabama State Law
Enforcement Agency along with a sufficient fee required to
perform the criminal history records background check by the
agency and the Federal Bureau of Investigation.
Notwithstanding any state law to the contrary, all records
related to any criminal background check conducted pursuant to
this subsection shall be accessible and made available, upon
request, by the commission.
(b) If the criminal background check of a prospective
officer, employee, or contractor indicates a pending charge or
conviction within the past five years for a controlled
substance-related felony or a controlled substance-related
misdemeanor, a licensee may not appoint, hire, or contract
with the prospective officer, employee, or contractor without
written permission of the commission; provided, however, a
licensee shall not consider any conviction overturned on
appeal or any charge that has been expunged pursuant to
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appeal or any charge that has been expunged pursuant to
Chapter 27 of Title 15.
(c) Each licensee shall enter all transactions, current
inventory, and other information into the statewide
seed-to-sale tracking system in accordance with rules adopted
by the commission and the department ."
"§20-2A-62
(a)(1) A cultivator license authorizes all of the
following:
a. The cultivation of cannabis.
b. The sale or transfer of cannabis to a processor.
c. If the cultivator contracts with a processor to
process its cannabis into medical cannabis on the cultivator's
behalf, the sale or transfer of medical cannabis to a
dispensary.
(2) A cultivator license authorizes the cultivator to
transfer cannabis only by means of a secure transporter.
(b) The commission shall consult with the Department of
Agriculture and Industries when determining the number of
cultivator licenses to issue, provided the commission shall
issue no more than 12 cultivator licenses.
(c) An applicant for a license under this section shall
meet all of the following requirements:
(1) Demonstrate the ability to secure and maintain
cultivation facilities.
(2) Demonstrate the ability to obtain and use an
inventory control and tracking system as required under
Section 20-2A-60.
(3) Demonstrate the ability to commence cultivation of
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(3) Demonstrate the ability to commence cultivation of
cannabis within 60 days of application approval notification.
(4) Demonstrate the ability to destroy unused or waste
cannabis in accordance with rules adopted by the department.
(5) Demonstrate the financial stability to provide
proper testing of individual lots and batches.
(d) A licensed cultivator shall comply with all of the
following, in accordance with rules adopted by the
departmentcommission:
(1) All facilities shall be protected by a monitored
security alarm system, be enclosed, and remain locked at all
times.
(2) All individuals entering and exiting facilities
shall be monitored by video surveillance and keypad or access
card entry.
(3) All employees may not have any conviction within
the past 10 years for a controlled substance-related felony or
a controlled substance-related misdemeanor other than a
conviction that was overturned on appeal or a charge that was
expunged pursuant to Chapter 27 of Title 15.
(4) Cultivatars Cultivars selected by a licensee must
be approved by the department commission prior to acquisition
of plant material for cultivation.
(e) A cultivator shall be subject to inspection by the
departmentcommission.
(f) The cultivation of cannabis pursuant to this
chapter shall be considered an agricultural purpose for
purposes of Section 40-23-4.
(g) Nothing in this section shall be construed to
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(g) Nothing in this section shall be construed to
prohibit the hydroponic growing of cannabis.
(h) The department shall consult with the commission
when adopting rules pursuant to this article. "
"§20-2A-63
(a)(1) A processor license authorizes all of the
following:
a. The purchase or transfer of cannabis from a
cultivator.
b. The processing of cannabis into medical cannabis
which shall include properly packaging and labeling medical
cannabis products, in accordance with this section.
c. The sale or transfer of medical cannabis to a
dispensary.
(2) A processor license authorizes the processor to
transfer medical cannabis only by means of a secure
transporter.
(b) The commission shall issue no more than four
processor licenses.
(c)(1) All medical cannabis products must be medical
grade product, manufactured using documented good quality
practices, and meet Good Manufacturing Practices, such that
the product is shown to meet intended levels of purity and be
reliably free of toxins and contaminants. Medical cannabis
products may not contain any additives other than
pharmaceutical grade excipients.
(2) The department commission shall be responsible for
enforcing Good Manufacturing Practices.
(d) Medical cannabis products may not be processed into
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(d) Medical cannabis products may not be processed into
a form that is attractive to or targets children, including
all of the following which are prohibited:
(1) Any product bearing any resemblance to a cartoon
character, fictional character whose target audience is
children or youth, or pop culture figure.
(2) Any product bearing a reasonable resemblance to a
product available for consumption as a commercially available
candy.
(3) Any product whose design resembles, by any means,
another object commonly recognized as appealing to, or
intended for use by, children.
(4) Any product whose shape bears the likeness or
contains characteristics of a realistic or fictional human,
animal, or fruit, including artistic, caricature, or cartoon
rendering.
(e) All of the following shall apply to all packages
and labels of medical cannabis products:
(1) Labels, packages, and containers shall not be
attractive to minors and may not contain any content that
reasonably appears to target children, including toys, cartoon
characters, and similar images. Packages shall be designed to
minimize appeal to children and must contain a label that
reads: "Keep out of reach of children."
(2) All medical cannabis products must be packaged in
child-resistant, tamper-evident containers.
(3) All medical cannabis product labels shall contain,
at a minimum, the following information:
a. Lot and batch numbers.
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a. Lot and batch numbers.
b. A license identification number for the cultivator
and a license identification number for the processor.
c. Cannabinoids content and potency.
d. The universal state symbol printed in color at least
one-half inch by one-half inch in size.
(f) The commission shall establish one universal flavor
for all gelatinous cube, cuboid, and lozenge medical cannabis
products.
(g) The following statement shall be included on each
label, if space permits, or as an insert within the package:
"WARNING: This product may make you drowsy or dizzy. Do not
drink alcohol with this product. Use care when operating a
vehicle or other machinery. Taking this product with
medication may lead to harmful side effects or complications.
Consult your physician before taking this product with any
medication. Women who are breastfeeding, pregnant, or plan to
become pregnant should discuss medical cannabis use with their
physicians."
(h) Any advertisement and any package or label may not
contain any false statement or statement that advertises
health benefits or therapeutic benefits of medical cannabis.
(i) The commission may require the implementation of a
digital image such as a QR Code for purposes of tracking
medical cannabis products. The digital image must interface
with the statewide seed-to-sale tracking system.
(j) The commission shall determine what information
from the label shall be entered into the statewide
seed-to-sale tracking system."
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seed-to-sale tracking system."
"§20-2A-67
(a) An integrated facility license authorizes all of
the following:
(1) The cultivation of cannabis.
(2) The processing of cannabis into medical cannabis,
including proper packaging and labeling of medical cannabis
products.
(3) The dispensing and sale of medical cannabis only to
a registered qualified patient or registered caregiver.
(4) The transport of cannabis or medical cannabis
between its facilities.
(5) The sale or transfer of medical cannabis to a
dispensary.
(b) The commission may issue no more than five
integrated facility licenses.
(c)(1) On or after June 1, 2024, only those applicants
that submitted an application for an integrated facility
license to the commission by December 31, 2022, may
participate in the selection process as provided in this
section. Each participating applicant shall provide to the
commission, not later than July 1, 2024: (i) the name and
contact information of at least one individual whom the
commission and review panel described in subdivision (3) may
contact as necessary throughout the license selection process;
and (ii) any amendments to the original application to update
information particularly relating to financial interests and
financial obligations so that all information pertaining to
the application is current.
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the application is current.
(2) The commission, not later than July 15, 2024, shall
publish on its website the updated application for each
participating applicant, as described in subdivision (1). The
commission shall only redact and keep confidential criminal
background check, Social Security numbers, financial account
numbers, and dates of birth, if applicable. The commission
shall immediately include any additional information requested
by the review panel in the respective application published on
the commission's website.
(3) No later than July 15, 2024, the Director of the
Alabama Securities Commission shall convene a review panel of
five individuals to make a determination of whether the
applicants meet the basic eligibility requirements described
in this subsection. The Alabama Medical Cannabis Commission
shall ensure the panel has sufficient resources to carry out
this duty. As expeditiously as possible, the review panel
shall determine, on an objective, pass or fail basis, if the
applicant has included all of the following information:
a. Residency requirements, as required under Section
20-2A-55(a)(10), it being the intent that the requirement set
forth in that section apply to the applicant's beneficial and
not legal ownership of the applicant.
b. Agriculture experience requirements, as required
under Section 20-2A-55(a)(11), it being the intent that the
requirement set forth in that section apply to the applicant's
beneficial and not legal ownership of the applicant.
c. Disclosure of the business structure and disclosure
of the names of all entities and individuals with a
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of the names of all entities and individuals with a
controlling interest in the applicant, as required under
Section 20-2A-55(a)(2) and (3).
d. Confirmation that all parties with an economic
interest submit to a criminal background check, as required
under Section 20-2A-55(b). This requirement shall be broadly
interpreted to include each person who will or may benefit
from the integrated facility business. If the applicant has a
parent or holding company or is under a management or other
vendor agreement with an operating company, individuals
associated with any such company must be included in the
criminal background check.
e. A detailed description of the relationship in the
cannabis industry of each entity and individual required to be
disclosed in the application that confirms that the applicant
has no direct or indirect relationship with another applicant
for an integrated license. Details shall include the nature of
any business both within and outside the state, relating to
the cannabis industry, whether medical or recreational, and
investments in any business that aligns itself as a vendor,
service, or maker of a product used in the cannabis industry,
including companies that are financial or insurance related.
f. Proof that the applicant is in compliance with all
tax filings and other obligations required in each state where
the applicant does business.
g. Completion of a detailed business plan that includes
plans for employment and biographical information about the
managers and operators.
h. Proof of sufficient capital that ensures the
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h. Proof of sufficient capital that ensures the
applicant will be able to produce a high quality medical
cannabis product even if market circumstances require the
business to operate at a loss. Financial projections may not
be based on market success or future earnings.
i. A detailed description of the physical properties
where applicants' operations will be located.
(4) The applicant carries the burden to disclose the
information upon which the review panel will make its
determination and shall immediately provide any additional
information requested by the review panel. The review panel
shall maintain a record of all communications with an
applicant. Upon conclusion of making its determination, the
review panel shall present the results of the determination,
along with the record of all communications and its findings,
to the commission.
(5) Once the review panel makes a final determination
that an applicant meets the basic eligibility requirements in
subdivisions (3) and (4), the review panel shall determine if
each applicant can demonstrate that the applicant will be able
to meet all of the following criteria for readiness of the
cultivation and dispensing operations of an applicant:
a. Within 60 days after the awarding of a license, the
applicant's business has built and possesses an enclosed
cultivation facility that meets all of the following:
1. The structure must be built in accordance with the
plans for the structure submitted with the application.
2. All cannabis must be cultivated using artificial
light exclusively or as a supplement to natural sunlight.
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light exclusively or as a supplement to natural sunlight.
3. The enclosed structure must meet security
requirements of this chapter and rules adopted thereunder.
4. The enclosed structure may be a greenhouse, pod, or
similar structure that protects plants from variable
temperature, precipitation, wind, and other elements.
5. Each cannabis plant or batch of cannabis plants must
be cultivated in an individual receptacle containing soil or
growing media, so as to foster portability, limit
cross-contamination, and facilitate proper monitoring of each
plant.
6. Containers may be for individual plants or for
batches of plants as long as each plant is clearly identified
and traceable.
7. No cultivation is allowed outdoors or directly in
the ground.
b. The applicant's business possesses a minimum of five
dispensing sites that can be opened to the public within six
months after the awarding of a license. The commission shall
inspect these sites to determine whether they meet all the
criteria under Section 20-2A-64 for dispensaries and are
capable of being built and operational within the six-month
period.
(c)(d) An integrated facility licensee shall have the
same authorizations granted to, and shall comply with all
requirements for, cultivators, processors, secure
transporters, and dispensaries, in addition to any other
authorizations or requirements under this section or as
established by rule by the commission.
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established by rule by the commission.
(d)(e)(1) An applicant Once the Alabama Securities
Commission review panel determines an applicant has met all of
the preliminary requirements set forth in subsection (b), the
Alabama Medical Cannabis Commission shall score the remaining
pool of applicants for an integrated facility license shall
provide, as further provided in subdivision (3), based on all
of the following criteria provided by the eligible applicants :
a. A long-term plan for serving the residents of
Alabama by securely providing quality medical cannabis
products to registered qualified patients.
(1)b. A letter of commitment or other acknowledgement,
as determined by commission rule, of the applicant's ability
to secure a performance bond issued by a surety insurance
company payable to the State of Alabama approved by the
commission in the amount of two million dollars ($2,000,000)
or proof that such a bond will be obtainable once an applicant
is licensed.
(2)c. Proof of at least two hundred fifty thousand
dollars ($250,000) in liquid assets.
(3)d. Proof that the applicant has the financial
ability liquid funds necessary to maintain operations for not
less than two years following the date of application by the
presentation of a business plan showing the total estimate for
all expenses, including, but not limited to, expenses for
rent, mortgages, maintenance, security, and insurance;
operation expenses for cultivation and processing facilities;
operation expenses for dispensing sites; and expenses for
salaries, benefits, and taxes. Funds equal to or in excess of
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salaries, benefits, and taxes. Funds equal to or in excess of
the total funds necessary for all of these expenses must be on
deposit in the accounts of the applicant's business. These
deposits must be verified by a sworn statement from an
accounting firm that has been allowed access to the business'
bank accounts to verify deposits and the balance in the
accounts. An applicant's business that has a sworn statement
from an accounting firm that verifies the business has a
minimum of four million dollars ($4,000,000) on deposit in its
bank accounts shall be deemed to have the liquid funds
necessary to maintain operations for not less than two years
without further proof regarding its expenses. The funds on
deposit in the applicant's bank accounts do not qualify as
liquid funds necessary to maintain operations for two years if
any of the funds were borrowed by any owner of the business or
from any third party, were pledged as security for any
obligation, or are subject to repayment to another person
under any obligation or understanding among the parties .
(2) The applicant shall be required to certify under
oath to the commission that the applicant's business: (i)
meets the requirements for the ownership and operation of an
integrated facility license under this act; (ii) meets the
requirements for a performance bond, minimum paid-in capital
or cash investment; (iii) has the funds necessary to sustain
operations for a minimum of two years; and (iv) is in
compliance with the rules of the commission.
(3) For each applicant, each commission member shall
assign a numeric score for each of the criteria enumerated in
subdivision (1) after review and inspection, as appropriate.
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subdivision (1) after review and inspection, as appropriate.
The commission shall drop the highest and lowest numeric score
assigned by each member and thereafter, the commission shall
add the numeric scores assigned by each commission member to
calculate a total score for the applicant. Licenses shall be
awarded to the five applicants that receive the highest
cumulative score.
(e)(f) At the time a license is issued under this
section, the commission shall ensure that the licensee has
secured a performance bond as provided in subdivision (1) of
subsection (d) paragraph (e)(1)b .
(f)(g) A licensee may open and operate up to five
dispensing sites within six months after the date a license is
issued., each of which Each of the dispensing sites must be
located in a different county from any other dispensing site
that the licensee operates; provided, however, the commission
may authorize a licensee to operate a greater number of
dispensing sites if, at least one year after the date when the
maximum number of total dispensing sites authorized under this
section and Section 20-2A-64 are operating, the commission
determines that the patient pool has reached a sufficient
level to justify an additional dispensing site in an
underserved or unserved area of the state. Notwithstanding the
foregoing, a licensee may not operate any dispensing site in
the unincorporated area of a county or in a municipality that
has not adopted a resolution or ordinance authorizing the
operation of dispensing sites under subsection (c) of Section
20-2A-51(c). This subsection shall not be construed to limit
wholesale distribution from integrated facility licensees to
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wholesale distribution from integrated facility licensees to
dispensary licensees."
Section 3. This act shall become effective on June 1,
2024.
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