Muriel Bowser Mayor Enclosure MURIEL BOWSER MAYOR February 28, 2025 The Honorable Phil Mendelson Chair Council of the District of Columbia 1350 Pennsylvania Avenue, N.W., Suite 506 Washington, D.C. 20004 Dear Chairman Mendelson: Enclosed for consideration and enactment by the Council of the District of Columbia is the “Unlicensed Establishment Enforcement Clarification Emergency Amendment Act of 2025,” along with accompanying an accompanying emergency declaration resolution, and the “Unlicensed Establishment Enforcement Clarification Temporary Amendment Act of 2025.” To date, the Alcoholic Beverage and Cannabis Administration (ABCA), along with the Metropolitan Police Department, have been able to take action to close down thirty- one unlicensed cannabis establishments operating in the District illegally. Despite this progress, additional enforcement authority will better equip ABCA to move forward with the closure of the remaining operating unlicensed establishments. These emergency measures would therefore expand ABCA’s authority to take summary action and padlock businesses engaged in illegal commerce in cannabis and Schedule I substances by expanding the agency’s padlocking authority to medical cannabis businesses and non- licensed businesses engaged in the illegal sale of cannabis or Schedule I substances and ending the grace period that prevented enforcement against certain unlicensed businesses that applied for a license with ABCA but have not obtained a license by April 1, 2025. For these reasons discussed above, I urge the Council to take prompt and favorable action on the enclosed proposed bill . Sincerely, 1 2 3 at the request of the Mayor 4 5 6 7 8 9 A BILL 10 11 12 13 14 IN THE COUNCIL OF THE DISTRICT OF COLUMBIA 15 16 17 18 19 To amend, on an emergency basis, the Legalization of Marijuana for Medical Treatment 20 Initiative of 1999 to amend the definition of an unlicensed establishment to include 21 establishments that sell Schedule I substances or products that contain Schedule I 22 substances; to authorize enforcement actions to be taken against all unlicensed 23 establishments beginning on April 1, 2025, regardless of whether the unlicensed 24 establishments have an application pending application before the Alcoholic Beverage 25 and Control Board ("ABC Board"); to authorize certain enforcement actions before April 26 1, 2025, against an unlicensed establishment that has an application pending before the 27 ABC Board if the unlicensed establishment sells a Schedule I substance or a product that 28 contains a Schedule I substance; to authorize summary closures and related enforcement 29 actions to continue for as long as the imminent danger to the public persists and is likely 30 to recur; and to authorize the ABC Board to issue a notice of summary closure to and 31 order the padlocking of, and the Alcoholic Beverage and Cannabis Administration and 32 Metropolitan Police Department to take related enforcement actions against, a licensed 33 medical cannabis establishment that engages in certain unlawful activity. 34 35 BE IT ENACTED BY THE COUNCIL OF THE DISTRICT OF COLUMBIA, That this 36 act may be cited as the "Unlicensed Establishment Enforcement Clarification Emergency 37 Amendment Act of 2025". 38 Sec. 2. The Legalization of Marijuana for Medical Treatment Initiative of 1999, effective 39 July 27, 2010 (D. C. Law 18-210; D. C. Official Code§ 7-1671.01 et seq.), is amended as follows: 40 (a) Section 2 (D.C. Official Code§ 7-1671.01) is amended as follows: (1) A new paragraph (2B) is added to read as follows: 41 “(2B) “Cannabis product” means a product derived from or composed of 42 cannabis, in part or in whole.”. 43 (2) A new paragraph (20B-i) is added to read as follows: 44 “(20B-i) “Schedule I substance” means a controlled substance listed in section 45 204 of the District of Columbia Uniform Controlled Substances Act of 1981, effective August 5, 46 1981 (D.C. Law 4- 29; D.C. Official Code § 48- 902.04), or rules implementing that section.”. 47 (3) Paragraph (22) is amended to read as follows: 48 “(22) “Unlicensed establishment" means: 49 “(A) A sole proprietorship, partnership, or other business entity that: 50 “(i) Sells, exchanges as part of a commercial transaction, or 51 delivers cannabis and cannabis products; 52 “(ii) Operates at or delivers from a specific location in the District; 53 and 54 “(iii) Is not licensed by ABCA as a cultivation center, retailer, 55 internet retailer, manufacturer, courier, or testing laboratory; or 56 “(B) For the purposes of section 9(g), (h), and (i), a sole proprietorship, 57 partnership, or other business entity that: 58 “(i) Sells, exchanges as part of a commercial transaction, or 59 delivers Schedule I substances or products that contain Schedule I substances; and 60 “(ii) Operates at or delivers from a specific location in the 61 District.”. 62 (b) Section 7b (D.C. Official Code § 7- 1671.06b) is amended by adding a new subsection 63 (a-1) to read as follows: 64 “(a-1) Notwithstanding subsection (a) of this section: 65 “(1) Regardless of whether an unlicensed establishment has a retailer or internet 66 retailer application pending review with the ABC Board, the ABCA may inspect the entire 67 premises, inventory, and business records of the unlicensed establishment pursuant to section 68 9(g), ABCA investigators from testing products of the unlicensed establishment under section 69 9(i), and the ABC Board from summarily closing and ordering the padlocking of the unlicensed 70 establishment pursuant to section 9(g), ABCA or MPD from padlocking the unlicensed 71 establishment pursuant to section 9(g), ABCA or MPD from seizing cannabis, cannabis products, 72 Schedule I substances, and products that contain Schedule I substances found at the premises of 73 the unlicensed establishment pursuant to section 9(g), or the ABC Board, ABCA, or MPD from 74 taking action under section 9(h) if the unlicensed establishment distributes, attempts to distribute, 75 or makes available for sale or exchange a Schedule I substance or a product that contains a 76 Schedule I substance. 77 “(2) After April 1, 2025, a n unlicensed establishment shall be subject to 78 compliance with this act regardless of whether the unlicensed establishment has a retailer or 79 internet retailer application pending review with the ABC Board.”. 80 (c) Section 9 (D.C. Official Code § 7- 1671.08) is amended as follows: 81 (1) Subsection (g) is amended as follows: 82 (A) Paragraph (1) is amended as follows: 83 (i) Strike the phrase “this title” and insert the phrase “this act or is 84 selling, exchanging as part of a commercial transaction, or delivering a Schedule I substance or 85 products that contains a Schedule I substance” in its place. 86 (ii) Strike the phrase “cannabis products” and insert the phrase 87 “cannabis products, Schedule I substances, or products that contain Schedule I substances” in its 88 place. 89 (B) A new paragraph (6) is added to read as follows: 90 “(6) The Board may continue the summary closure and order of padlocking, and 91 the padlocking of the premises and seizure of cannabis, cannabis products, Schedule I 92 substances, and products containing Schedule I substances may continue, until the imminent 93 danger that trigger ed the summary closure is abated. Even if the imminent danger that trigger ed 94 the summary closure is abated, the Board may continue the summary closure, and the padlocking 95 of the premises and seizure of cannabis, cannabis products, Schedule I substances, and products 96 containing Schedule I substances may continue, if the Board determines, in its reasonable 97 judgment, the imminent danger is likely to recur.”. 98 (2) Subsection (i)(1) is amended to read as follows: 99 “(i)(1) An ABCA investigator may test substances and products found at a licensed 100 establishment or unlicensed establishment for the presence and quantity of THC or a Schedule I 101 substance.”. 102 (3) A new subsection (j) is added to read as follows: 103 “(j)(1) The ABC Board may summarily close and order the padlocking, by ABCA or 104 MPD without a prior hearing, of a licensed establishment, and ABCA or MPD may seize all 105 cannabis, cannabis products, Schedule I substances, and products containing Schedule I 106 substances found at the premises, if, after an inspection, ABCA determines that the licensed 107 establishment that presents an imminent danger to the health and safety of the public for the 108 reasons set forth in subsection (g) (C) through (G) of this section. 109 “(2) ABCA shall provide the licensed establishment’s owner and the property 110 owner with written notice of the summary closure and the right to request a hearing. 111 “(3) The owner of the licensed establishment shall have 5 business days after 112 service of the notice of summary closure to request a hearing with the ABC Board, which shall 113 hold a hearing within 5 business days of a timely request. The ABC Board shall issue a written 114 decision within 5 business days after the hearing, or if no hearing is requested, within 10 115 business days after the service of the notice . 116 “(4)(A) ABCA or the Metropolitan Police Department may post signage at the 117 site of the licensed establishment indicating that unlawful activity has been found to have 118 occurred for violations of this chapter. 119 “(B) If the ABC Board orders the closure of a licensed establishment, the 120 ABC Board shall post 2 notices in conspicuous places at or near the main street entrance on the 121 outside of the establishment. 122 “(C) The posted notice shall state that the closure is ordered because of a 123 violation of this chapter or of the regulations promulgated pursuant to this chapter. 124 “(D) Any person willfully removing, obliterating, or defacing the notice 125 shall be guilty of a violation of this chapter.”. 126 Sec 4. Fiscal impact statement. 127 The Council adopts the fiscal impact statement of the Chief Financial Officer as the fiscal 128 impact statement required by section 4a of the General Legislative Procedures Act of 1975, 129 approved October 16, 2006 (120 Stat. 2038; D.C. Official Code § 1- 301.47a). 130 Sec. 5. Effective date. 131 This act shall take effect following approval by the Mayor (or in the event of veto by the 132 Mayor, action by the Council to override the veto), and shall remain in effect for no longer than 133 90 days, as provided for emergency acts of the Council of the District of Columbia in section 134 412(a) of the District of Columbia Home Rule Act, approved December 24, 1973 (87 Stat. 788; 135 D.C. Official Code § 1- 204.12(a)). 136 3 GOVERNMENT OF THE DISTRICT OF COLUMBIA O FFICE OF THE ATTORNEY GENERAL BRIAN L. SCHWALB PRIVILEGED AND CONFIDENTIAL ATTORNEY GENERAL ATTORNEY-CLIEN T COMMUNICATION LEGAL COUNSEL DIVISION MEMORANDUM TO: Tomás Talamante Director Office of Policy and Legislative Affairs FROM: Adele El-Khouri Deputy Attorney General Legal Counsel Division DATE: February 27, 2025 SUBJECT: Legal Sufficiency Review – Draft “Unlicensed Establishment Enforcement Clarification Emergency Amendment Act of 2025,” “Unlicensed Establishment Enforcement Clarification Temporary Amendment Act of 2025,” and “Unlicensed Establishment Enforcement Clarification Emergency Declaration Resolution of 2025” (AE-25-66) _____________________________________________________________________________________ This is to Certify that this Office has reviewed the above-referenced draft legislation and found it to be legally sufficient. If you have any questions in this regard, please do not hesitate to call me at (202) 262-6402. _________________________________ Adele El-Khouri