Hawaii 2022 Regular Session

Hawaii House Bill HB238 Compare Versions

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11 HOUSE OF REPRESENTATIVES H.B. NO. 238 THIRTY-FIRST LEGISLATURE, 2021 STATE OF HAWAII A BILL FOR AN ACT RELATING TO cannabis. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
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4747 SECTION 1. The legislature finds that a growing number of jurisdictions have legalized the recreational use of non-medical marijuana or cannabis. The legislature also finds that laws criminalizing the possession of small amounts of cannabis are costly to enforce while having limited deterrent value. The legislature further finds that a more effective use of public resources would be to allow the development of a lawful recreational cannabis industry that is regulated and taxed, thereby allowing law enforcement agencies to focus their efforts on more serious offenses. At the same time, limits on allowable quantities of cannabis for recreational use by persons twenty-one years of age and over must be enforced, and safeguards that restrict access to persons under twenty-one must be ensured -- similar to the manner in which state laws prohibit the sale of alcohol and tobacco products to persons under twenty-one. The purpose of this Act is to: (1) Authorize persons twenty-one years of age or older to possess or use limited amounts of cannabis for recreational purposes; (2) Authorize the licensing, regulation, and taxation of cannabis cultivation, manufacturing, testing, and retail sales facilities; (3) Specify that only existing medical cannabis dispensary licensees may apply for licensure as a cannabis establishment, but may be permitted to establish additional retail dispensing locations; (4) Allocate an unspecified percentage of general excise tax revenues derived from retail cannabis sales transactions to the counties; (5) Specify the application and non-application of the Internal Revenue Code to expenses related to the production and sale of cannabis and cannabis products for state income tax purposes; (6) Amend certain provisions of the penal code relating to offenses involving marijuana and expand the affirmative defense to prosecution to include persons acting in accordance with the new part in Chapter 329, Hawaii Revised Statutes, created by Section 2 of this Act; and (7) Repeal limitations on authorized sources of medical cannabis. SECTION 2. Chapter 329, Hawaii Revised Statutes, is amended by adding a new part to be appropriately designated and to read as follows: "PART . RECREATIONAL USE OF CANNABIS §329-A Definitions. As used in this part, unless the context otherwise requires: "Cannabis" shall have the same meaning as in section 329‑121. "Cannabis accessories" means any equipment, products, or materials of any kind that are used, intended for use, or designed for use in planting, propagating, cultivating, growing, harvesting, composting, manufacturing, compounding, converting, producing, processing, preparing, testing, analyzing, packaging, repackaging, storing, vaporizing, or containing cannabis, or for ingesting, inhaling, or otherwise introducing cannabis into the human body. "Cannabis cultivation facility" means an entity licensed to cultivate, prepare, and package cannabis and sell cannabis to retail cannabis stores, cannabis product manufacturing facilities, and other cannabis cultivation facilities, but not to consumers. "Cannabis establishment" means a cannabis cultivation facility, a cannabis testing facility, a cannabis product manufacturing facility, or a retail cannabis store. "Cannabis product manufacturing facility" means an entity licensed to purchase cannabis; manufacture, prepare, and package cannabis products; and sell cannabis and cannabis products to other cannabis product manufacturing facilities and to retail cannabis stores, but not to consumers. "Cannabis products" means concentrated cannabis products and cannabis products that consist of cannabis and other ingredients and are intended for use or consumption, including edible products, ointments, and tinctures. "Cannabis testing facility" means an entity licensed to analyze and certify the safety and potency of cannabis. "Consumer" means a person twenty-one years of age or older who grows, possesses, or purchases cannabis or cannabis products for recreational use by persons twenty-one years of age or older, but not for resale to others. "Department" means the department of health. "Retail cannabis store" means an entity licensed to purchase cannabis from cannabis cultivation facilities and cannabis and cannabis products from cannabis product manufacturing facilities and to sell cannabis and cannabis products to consumers. §329-B Recreational use of cannabis. Notwithstanding any other provision of law, the following acts shall be lawful and shall not be an offense or a basis for seizure or forfeiture of assets for persons twenty-one years of age or older: (1) Possessing, using, displaying, purchasing, or transporting cannabis accessories or one ounce or less of cannabis; (2) Possessing, growing, processing, or transporting seven or fewer cannabis plants, and possession of the cannabis produced by the plants; provided that the cannabis is not made available for sale; (3) Transfer of one ounce or less of cannabis without remuneration to a person who is twenty-one years of age or older; (4) Consumption of cannabis; provided that nothing in this section shall permit consumption that is conducted openly and publicly or in a manner that endangers others; and (5) Assisting another person who is twenty-one years of age or older in committing any of the acts described in this section. §329-C Lawful operation of cannabis establishments. Notwithstanding any other provision of law, the following acts shall be lawful and shall not be an offense or a basis for arrest, prosecution, or seizure or forfeiture of assets for persons twenty-one years of age or older: (1) Manufacture, possession, or purchase of cannabis accessories or the sale of cannabis accessories to a person who is twenty-one years of age or older; (2) Possessing, displaying, or transporting cannabis or cannabis products; purchase of cannabis from a cannabis cultivation facility; purchase of cannabis or cannabis products from a cannabis product manufacturing facility; or sale of cannabis or cannabis products to consumers, if the person conducting the activities described in this paragraph has obtained a current, valid license to operate a retail cannabis store or is acting in the person's capacity as an owner, employee, or agent of a licensed retail cannabis store; (3) Cultivating, harvesting, processing, packaging, transporting, displaying, or possessing cannabis; delivery or transfer of cannabis to a cannabis testing facility; selling cannabis to a cannabis cultivation facility, a cannabis product manufacturing facility, or a retail cannabis store; or the purchase of cannabis from a cannabis cultivation facility, if the person conducting the activities described in this paragraph has obtained a current, valid license to operate a cannabis cultivation facility or is acting in the person's capacity as an owner, employee, or agent of a licensed cannabis cultivation facility; (4) Packaging, processing, transporting, manufacturing, displaying, or possessing cannabis or cannabis products; delivery or transfer of cannabis or cannabis products to a cannabis testing facility; selling cannabis or cannabis products to a retail cannabis store or a cannabis product manufacturing facility; the purchase of cannabis from a cannabis cultivation facility; or the purchase of cannabis or cannabis products from a cannabis product manufacturing facility, if the person conducting the activities described in this paragraph has obtained a current, valid license to operate a cannabis product manufacturing facility or is acting in the person's capacity as an owner, employee, or agent of a licensed cannabis product manufacturing facility; (5) Possessing, cultivating, processing, repackaging, storing, transporting, displaying, transferring, or delivering cannabis or cannabis products if the person has obtained a current, valid license to operate a cannabis testing facility or is acting in the person's capacity as an owner, employee, or agent of a licensed cannabis testing facility; and (6) Leasing or otherwise allowing the use of property owned, occupied, or controlled by any person, corporation, or other entity for any of the activities conducted lawfully in accordance with this section. §329-D Department rules; cannabis establishments. (a) No later than July 1, 2022, the department shall adopt rules under chapter 91 necessary to implement this part, which shall at a minimum include: (1) Procedures for the issuance, renewal, suspension, and revocation of a license to operate a cannabis establishment; (2) A schedule of application, licensing, and renewal fees; provided that a fee of no less than $ shall be imposed upon the issuance of a one-year license to operate a cannabis establishment; provided further that per cent of all fees collected under this paragraph shall be deposited into the cannabis establishment program sub-account of the cannabis registry and regulation special fund established under section 321-30.1(b)(3); (3) Qualifications for licensure that are directly and demonstrably related to the operation of a cannabis establishment; provided that a qualification of licensure under this part shall include a requirement that an applicant or licensee is currently licensed to operate a medical cannabis dispensary under chapter 329D; provided further that the department may permit the applicant or licensee to establish additional retail dispensing locations for the purpose of operating a cannabis establishment in accordance with this part; (4) Security requirements for cannabis establishments; (5) Requirements to prevent the sale or diversion of cannabis and cannabis products to persons under the age of twenty-one; (6) Labeling requirements for cannabis and cannabis products sold or distributed by a cannabis establishment; (7) Health and safety requirements and standards for the manufacture of cannabis products and the cultivation of cannabis; provided that the standards shall be no less stringent than those applicable to medical cannabis under part IX of this chapter and chapter 329D; (8) Restrictions on the advertising and display of cannabis and cannabis products; and (9) Civil penalties for the failure to comply with any rule adopted pursuant to this section. (b) For the purpose of ensuring that individual privacy is protected, notwithstanding subsection (a), the department shall not require a consumer to provide a retail cannabis store with personal information other than government-issued identification to determine the consumer's age, and a retail cannabis store shall not be required to acquire and record personal information about consumers other than information typically acquired in a financial transaction conducted at a retail liquor store. §329-E Cannabis establishments; licenses; procedures. (a) A license to operate a cannabis establishment shall be valid for one year and shall be renewable annually. (b) Each applicant for a license to operate a cannabis establishment shall submit an application to the department, which shall process applications expeditiously and: (1) Upon approval of an application, shall issue an annual license to the applicant; or (2) Upon denial of an application, shall notify the applicant in writing of the specific reason for the denial, within seven days of the approval or denial. §329-F Employers; driving; minors; control of property. Nothing in this part shall be construed to: (1) Require an employer to permit or accommodate the use, consumption, possession, transfer, display, transportation, sale, or growing of cannabis in the workplace or to affect the ability of employers to establish policies restricting the use of cannabis by employees; (2) Supersede any law relating to driving under the influence of cannabis or driving while impaired by cannabis; (3) Permit the transfer of cannabis, with or without remuneration, to a person under the age of twenty-one or to allow a person under the age of twenty-one to purchase, possess, use, transport, grow, or consume cannabis; or (4) Prohibit a person, employer, school, hospital, detention facility, corporation, or any other entity that occupies, owns, or controls property from prohibiting or otherwise regulating the possession, consumption, use, display, transfer, distribution, sale, transportation, or growing of cannabis on or in that property. §329-G Medical cannabis provisions unaffected. Nothing in this part shall be construed to limit any privileges or rights of a medical cannabis qualifying patient, primary caregiver, or registered entity as provided in part IX of this chapter. §329-H Severability; conflicting provisions. All provisions of this part are severable and, except where otherwise indicated, shall supersede conflicting state statutory, local charter, ordinance, or resolution, and other state and local provisions." SECTION 3. Section 46-4, Hawaii Revised Statutes, is amended by amending subsection (f) to read as follows: "(f) Neither this section nor any other law, county ordinance, or rule shall prohibit the use of land for medical cannabis production centers or medical cannabis dispensaries established and licensed pursuant to chapter 329D[;] or cannabis establishments established and licensed pursuant to part of chapter 329; provided that the land is otherwise zoned for agriculture, manufacturing, or retail purposes." SECTION 4. Section 235-2.4, Hawaii Revised Statutes, is amended by amending subsection (v) to read as follows: "(v) Section 280E (with respect to expenditures in connection with the illegal sale of drugs) of the Internal Revenue Code shall be operative for the purposes of this chapter, except that section 280E shall not be operative with respect to the production and sale of [medical]: (1) Medical cannabis and manufactured cannabis products by dispensaries licensed under chapter 329D and their subcontractors, as defined in section 329D-1[.]; and (2) Cannabis and cannabis products by cannabis establishments licensed under part of chapter 329." SECTION 5. Section 237-31, Hawaii Revised Statutes, is amended to read as follows: "§237-31 Remittances. All remittances of taxes imposed by this chapter shall be made by money, bank draft, check, cashier's check, money order, or certificate of deposit to the office of the department of taxation to which the return was transmitted. The department shall issue its receipts therefor to the taxpayer and shall pay the moneys into the state treasury as a state realization, to be kept and accounted for as provided by law; provided that: (1) A sum, not to exceed $5,000,000, from all general excise tax revenues realized by the State shall be deposited in the state treasury in each fiscal year to the credit of the compound interest bond reserve fund; (2) A sum from all general excise tax revenues realized by the State that is equal to one-half of the total amount of funds appropriated or transferred out of the hurricane reserve trust fund under sections 4 and 5 of Act 62, Session Laws of Hawaii 2011, shall be deposited into the hurricane reserve trust fund in fiscal year 2013-2014 and in fiscal year 2014-2015; provided that the deposit required in each fiscal year shall be made by October 1 of that fiscal year; [and] (3) A sum equal to per cent of any general excise tax revenues realized from retail cannabis sales transactions, conducted pursuant to and in compliance with part of chapter 329, shall be paid to the director of finance of the county in which the revenues were collected; and [[(3)]] (4) Commencing with fiscal year 2018-2019, a sum from all general excise tax revenues realized by the State that represents the difference between the state public employer's annual required contribution for the separate trust fund established under section 87A-42 and the amount of the state public employer's contributions into that trust fund shall be deposited to the credit of the State's annual required contribution into that trust fund in each fiscal year, as provided in section 87A-42." SECTION 6. Section 321-30.1, Hawaii Revised Statutes, is amended by amending its title and subsections (a) and (b) to read as follows: "§321-30.1 [Medical cannabis] Cannabis registry and regulation special fund; established. (a) There is established within the state treasury the [medical] cannabis registry and regulation special fund. The fund shall be expended at the discretion of the director of health: (1) To establish and regulate a system of medical cannabis dispensaries in the State; (2) To offset the cost of the processing and issuance of patient registry identification certificates and primary caregiver registration certificates; (3) To fund positions and operating costs authorized by the legislature; (4) To establish and manage a secure and confidential database; (5) To fund public education as required by section 329D‑26; (6) To fund substance abuse prevention and education programs; [and] (7) To regulate cannabis establishments in the State pursuant to part of chapter 329; and [(7)] (8) For any other expenditure necessary, consistent with this chapter [and], chapter 329D, and part of chapter 329, to implement medical cannabis registry and regulation programs[.] and cannabis establishment regulation programs. (b) The fund shall consist of all moneys derived from fees collected pursuant to subsection (c) [and], section 329D-4[.], and part of chapter 329. There is established within the [medical] cannabis registry and regulation special fund: (1) A medical cannabis registry program sub-account, into which shall be deposited all fees collected pursuant to subsection (c); [and] (2) A medical cannabis dispensary program sub-account, into which shall be deposited all fees collected pursuant to section 329D-4[.]; and (3) A cannabis establishment program sub-account, into which shall be deposited fees collected and allocated pursuant to part of chapter 329." SECTION 7. Section 329-43.5, Hawaii Revised Statutes, is amended by amending subsection (e) to read as follows: "(e) Subsections (a) and (b) shall not apply to a person who is authorized to: (1) Acquire, possess, cultivate, use, distribute, or transport cannabis pursuant to the definition of "medical use" under section 329-121, while the person is facilitating the medical use of cannabis by a qualifying patient; [or] (2) Dispense, manufacture, or produce cannabis or manufactured cannabis products pursuant to and in compliance with chapter 329D, while the person is facilitating the medical use of cannabis by a qualifying patient pursuant to part IX of chapter 329[.]; or (3) Grow, process, possess, transfer, display, transport, or use cannabis or cannabis products pursuant to and in compliance with part of this chapter." SECTION 8. Section 712-1240.1, Hawaii Revised Statutes, is amended by amending subsection (2) to read as follows: "(2) It is an affirmative defense to prosecution for any marijuana-related offense defined in this part that the person who possessed or distributed the marijuana was authorized to possess or distribute the marijuana for medical purposes pursuant to part IX of chapter 329[.] or acted in accordance with part of that chapter." SECTION 9. Section 712-1248, Hawaii Revised Statutes, is amended by amending subsection (1) to read as follows: "(1) A person commits the offense of promoting a detrimental drug in the second degree if the person knowingly: (a) Possesses fifty or more capsules or tablets containing one or more of the Schedule V substances; (b) Possesses one or more preparations, compounds, mixtures, or substances, of an aggregate weight of one- eighth ounce or more, containing one or more of the Schedule V substances; (c) Possesses one or more preparations, compounds, mixtures, or substances, of an aggregate weight of one ounce or more, containing any marijuana[; or], and the person is under the age of twenty-one; (d) Possesses one or more preparations, compounds, mixtures, or substances, of an aggregate weight of more than one ounce, containing any marijuana, and the person is twenty-one years of age or older, except as provided under part of chapter 329; or [(d)] (e) Distributes any marijuana or any Schedule V substance in any amount." SECTION 10. Section 712-1249, Hawaii Revised Statutes, is amended by amending subsection (1) to read as follows: "(1) A person commits the offense of promoting a detrimental drug in the third degree if the person knowingly possesses any marijuana or any Schedule V substance in any amount[.]; provided that, regarding marijuana, this subsection shall not apply to a person twenty-one years of age or older." SECTION 11. Section 712-1249.5, Hawaii Revised Statutes, is amended by amending subsection (1) to read as follows: "(1) A person commits the offense of commercial promotion of marijuana in the second degree if the person knowingly: (a) Possesses marijuana having an aggregate weight of two pounds or more; (b) Distributes marijuana having an aggregate weight of one pound or more; (c) Possesses, cultivates, or has under the person's control fifty or more marijuana plants; (d) Cultivates on land owned by another person, including land owned by the government or other legal entity, any marijuana plant, unless the person has the express permission from the owner of the land to cultivate the marijuana or the person has a legal or an equitable ownership interest in the land or the person has a legal right to occupy the land; [or] (e) Sells or barters any [marijuana or any] Schedule V substance in any amount to a minor[.]; or (f) Sells or barters any marijuana in any amount to a person under the age of twenty-one." SECTION 12. Section 329-130, Hawaii Revised Statutes, is repealed. ["§329-130 Authorized sources of medical cannabis. (a) After December 31, 2023, a qualifying patient shall obtain medical cannabis or manufactured cannabis products only: (1) From a dispensary licensed pursuant to chapter 329D; provided that the cannabis shall be purchased and paid for at the time of purchase; or (2) By cultivating cannabis in an amount that does not exceed an adequate supply for the qualifying patient, pursuant to section 329-122; provided that each location used to cultivate cannabis shall be used by no more than five qualifying patients. After December 31, 2023, no primary caregiver shall be authorized to cultivate cannabis for any qualifying patient. (b) This section shall not apply to: (1) A qualifying patient who is a minor or an adult lacking legal capacity and the primary caregiver is the parent, guardian, or person having legal custody of a qualifying patient described in this paragraph; or (2) A qualifying patient on any island on which there is no medical cannabis dispensary licensed pursuant to chapter 329D. (c) A qualifying out-of-state patient and a caregiver of a qualifying out-of-state patient shall be authorized to obtain cannabis for medical use only from retail dispensing locations of dispensaries licensed pursuant to chapter 329D."] SECTION 13. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date. SECTION 14. If any provision of this Act, or the application thereof to any person or circumstance, is held invalid, the invalidity does not affect other provisions or applications of the Act that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable. SECTION 15. In codifying the new sections added by section 2 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act. SECTION 16. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored. SECTION 17. This Act shall take effect on January 1, 2022; provided that section 4 shall apply to taxable years beginning after December 31, 2021. INTRODUCED BY: _____________________________
4848
4949 SECTION 1. The legislature finds that a growing number of jurisdictions have legalized the recreational use of non-medical marijuana or cannabis. The legislature also finds that laws criminalizing the possession of small amounts of cannabis are costly to enforce while having limited deterrent value.
5050
5151 The legislature further finds that a more effective use of public resources would be to allow the development of a lawful recreational cannabis industry that is regulated and taxed, thereby allowing law enforcement agencies to focus their efforts on more serious offenses. At the same time, limits on allowable quantities of cannabis for recreational use by persons twenty-one years of age and over must be enforced, and safeguards that restrict access to persons under twenty-one must be ensured -- similar to the manner in which state laws prohibit the sale of alcohol and tobacco products to persons under twenty-one.
5252
5353 The purpose of this Act is to:
5454
5555 (1) Authorize persons twenty-one years of age or older to possess or use limited amounts of cannabis for recreational purposes;
5656
5757 (2) Authorize the licensing, regulation, and taxation of cannabis cultivation, manufacturing, testing, and retail sales facilities;
5858
5959 (3) Specify that only existing medical cannabis dispensary licensees may apply for licensure as a cannabis establishment, but may be permitted to establish additional retail dispensing locations;
6060
6161 (4) Allocate an unspecified percentage of general excise tax revenues derived from retail cannabis sales transactions to the counties;
6262
6363 (5) Specify the application and non-application of the Internal Revenue Code to expenses related to the production and sale of cannabis and cannabis products for state income tax purposes;
6464
6565 (6) Amend certain provisions of the penal code relating to offenses involving marijuana and expand the affirmative defense to prosecution to include persons acting in accordance with the new part in Chapter 329, Hawaii Revised Statutes, created by Section 2 of this Act; and
6666
6767 (7) Repeal limitations on authorized sources of medical cannabis.
6868
6969 SECTION 2. Chapter 329, Hawaii Revised Statutes, is amended by adding a new part to be appropriately designated and to read as follows:
7070
7171 "PART . RECREATIONAL USE OF CANNABIS
7272
7373 §329-A Definitions. As used in this part, unless the context otherwise requires:
7474
7575 "Cannabis" shall have the same meaning as in section 329‑121.
7676
7777 "Cannabis accessories" means any equipment, products, or materials of any kind that are used, intended for use, or designed for use in planting, propagating, cultivating, growing, harvesting, composting, manufacturing, compounding, converting, producing, processing, preparing, testing, analyzing, packaging, repackaging, storing, vaporizing, or containing cannabis, or for ingesting, inhaling, or otherwise introducing cannabis into the human body.
7878
7979 "Cannabis cultivation facility" means an entity licensed to cultivate, prepare, and package cannabis and sell cannabis to retail cannabis stores, cannabis product manufacturing facilities, and other cannabis cultivation facilities, but not to consumers.
8080
8181 "Cannabis establishment" means a cannabis cultivation facility, a cannabis testing facility, a cannabis product manufacturing facility, or a retail cannabis store.
8282
8383 "Cannabis product manufacturing facility" means an entity licensed to purchase cannabis; manufacture, prepare, and package cannabis products; and sell cannabis and cannabis products to other cannabis product manufacturing facilities and to retail cannabis stores, but not to consumers.
8484
8585 "Cannabis products" means concentrated cannabis products and cannabis products that consist of cannabis and other ingredients and are intended for use or consumption, including edible products, ointments, and tinctures.
8686
8787 "Cannabis testing facility" means an entity licensed to analyze and certify the safety and potency of cannabis.
8888
8989 "Consumer" means a person twenty-one years of age or older who grows, possesses, or purchases cannabis or cannabis products for recreational use by persons twenty-one years of age or older, but not for resale to others.
9090
9191 "Department" means the department of health.
9292
9393 "Retail cannabis store" means an entity licensed to purchase cannabis from cannabis cultivation facilities and cannabis and cannabis products from cannabis product manufacturing facilities and to sell cannabis and cannabis products to consumers.
9494
9595 §329-B Recreational use of cannabis. Notwithstanding any other provision of law, the following acts shall be lawful and shall not be an offense or a basis for seizure or forfeiture of assets for persons twenty-one years of age or older:
9696
9797 (1) Possessing, using, displaying, purchasing, or transporting cannabis accessories or one ounce or less of cannabis;
9898
9999 (2) Possessing, growing, processing, or transporting seven or fewer cannabis plants, and possession of the cannabis produced by the plants; provided that the cannabis is not made available for sale;
100100
101101 (3) Transfer of one ounce or less of cannabis without remuneration to a person who is twenty-one years of age or older;
102102
103103 (4) Consumption of cannabis; provided that nothing in this section shall permit consumption that is conducted openly and publicly or in a manner that endangers others; and
104104
105105 (5) Assisting another person who is twenty-one years of age or older in committing any of the acts described in this section.
106106
107107 §329-C Lawful operation of cannabis establishments. Notwithstanding any other provision of law, the following acts shall be lawful and shall not be an offense or a basis for arrest, prosecution, or seizure or forfeiture of assets for persons twenty-one years of age or older:
108108
109109 (1) Manufacture, possession, or purchase of cannabis accessories or the sale of cannabis accessories to a person who is twenty-one years of age or older;
110110
111111 (2) Possessing, displaying, or transporting cannabis or cannabis products; purchase of cannabis from a cannabis cultivation facility; purchase of cannabis or cannabis products from a cannabis product manufacturing facility; or sale of cannabis or cannabis products to consumers, if the person conducting the activities described in this paragraph has obtained a current, valid license to operate a retail cannabis store or is acting in the person's capacity as an owner, employee, or agent of a licensed retail cannabis store;
112112
113113 (3) Cultivating, harvesting, processing, packaging, transporting, displaying, or possessing cannabis; delivery or transfer of cannabis to a cannabis testing facility; selling cannabis to a cannabis cultivation facility, a cannabis product manufacturing facility, or a retail cannabis store; or the purchase of cannabis from a cannabis cultivation facility, if the person conducting the activities described in this paragraph has obtained a current, valid license to operate a cannabis cultivation facility or is acting in the person's capacity as an owner, employee, or agent of a licensed cannabis cultivation facility;
114114
115115 (4) Packaging, processing, transporting, manufacturing, displaying, or possessing cannabis or cannabis products; delivery or transfer of cannabis or cannabis products to a cannabis testing facility; selling cannabis or cannabis products to a retail cannabis store or a cannabis product manufacturing facility; the purchase of cannabis from a cannabis cultivation facility; or the purchase of cannabis or cannabis products from a cannabis product manufacturing facility, if the person conducting the activities described in this paragraph has obtained a current, valid license to operate a cannabis product manufacturing facility or is acting in the person's capacity as an owner, employee, or agent of a licensed cannabis product manufacturing facility;
116116
117117 (5) Possessing, cultivating, processing, repackaging, storing, transporting, displaying, transferring, or delivering cannabis or cannabis products if the person has obtained a current, valid license to operate a cannabis testing facility or is acting in the person's capacity as an owner, employee, or agent of a licensed cannabis testing facility; and
118118
119119 (6) Leasing or otherwise allowing the use of property owned, occupied, or controlled by any person, corporation, or other entity for any of the activities conducted lawfully in accordance with this section.
120120
121121 §329-D Department rules; cannabis establishments. (a) No later than July 1, 2022, the department shall adopt rules under chapter 91 necessary to implement this part, which shall at a minimum include:
122122
123123 (1) Procedures for the issuance, renewal, suspension, and revocation of a license to operate a cannabis establishment;
124124
125125 (2) A schedule of application, licensing, and renewal fees; provided that a fee of no less than $ shall be imposed upon the issuance of a one-year license to operate a cannabis establishment; provided further that per cent of all fees collected under this paragraph shall be deposited into the cannabis establishment program sub-account of the cannabis registry and regulation special fund established under section 321-30.1(b)(3);
126126
127127 (3) Qualifications for licensure that are directly and demonstrably related to the operation of a cannabis establishment; provided that a qualification of licensure under this part shall include a requirement that an applicant or licensee is currently licensed to operate a medical cannabis dispensary under chapter 329D; provided further that the department may permit the applicant or licensee to establish additional retail dispensing locations for the purpose of operating a cannabis establishment in accordance with this part;
128128
129129 (4) Security requirements for cannabis establishments;
130130
131131 (5) Requirements to prevent the sale or diversion of cannabis and cannabis products to persons under the age of twenty-one;
132132
133133 (6) Labeling requirements for cannabis and cannabis products sold or distributed by a cannabis establishment;
134134
135135 (7) Health and safety requirements and standards for the manufacture of cannabis products and the cultivation of cannabis; provided that the standards shall be no less stringent than those applicable to medical cannabis under part IX of this chapter and chapter 329D;
136136
137137 (8) Restrictions on the advertising and display of cannabis and cannabis products; and
138138
139139 (9) Civil penalties for the failure to comply with any rule adopted pursuant to this section.
140140
141141 (b) For the purpose of ensuring that individual privacy is protected, notwithstanding subsection (a), the department shall not require a consumer to provide a retail cannabis store with personal information other than government-issued identification to determine the consumer's age, and a retail cannabis store shall not be required to acquire and record personal information about consumers other than information typically acquired in a financial transaction conducted at a retail liquor store.
142142
143143 §329-E Cannabis establishments; licenses; procedures. (a) A license to operate a cannabis establishment shall be valid for one year and shall be renewable annually.
144144
145145 (b) Each applicant for a license to operate a cannabis establishment shall submit an application to the department, which shall process applications expeditiously and:
146146
147147 (1) Upon approval of an application, shall issue an annual license to the applicant; or
148148
149149 (2) Upon denial of an application, shall notify the applicant in writing of the specific reason for the denial,
150150
151151 within seven days of the approval or denial.
152152
153153 §329-F Employers; driving; minors; control of property. Nothing in this part shall be construed to:
154154
155155 (1) Require an employer to permit or accommodate the use, consumption, possession, transfer, display, transportation, sale, or growing of cannabis in the workplace or to affect the ability of employers to establish policies restricting the use of cannabis by employees;
156156
157157 (2) Supersede any law relating to driving under the influence of cannabis or driving while impaired by cannabis;
158158
159159 (3) Permit the transfer of cannabis, with or without remuneration, to a person under the age of twenty-one or to allow a person under the age of twenty-one to purchase, possess, use, transport, grow, or consume cannabis; or
160160
161161 (4) Prohibit a person, employer, school, hospital, detention facility, corporation, or any other entity that occupies, owns, or controls property from prohibiting or otherwise regulating the possession, consumption, use, display, transfer, distribution, sale, transportation, or growing of cannabis on or in that property.
162162
163163 §329-G Medical cannabis provisions unaffected. Nothing in this part shall be construed to limit any privileges or rights of a medical cannabis qualifying patient, primary caregiver, or registered entity as provided in part IX of this chapter.
164164
165165 §329-H Severability; conflicting provisions. All provisions of this part are severable and, except where otherwise indicated, shall supersede conflicting state statutory, local charter, ordinance, or resolution, and other state and local provisions."
166166
167167 SECTION 3. Section 46-4, Hawaii Revised Statutes, is amended by amending subsection (f) to read as follows:
168168
169169 "(f) Neither this section nor any other law, county ordinance, or rule shall prohibit the use of land for medical cannabis production centers or medical cannabis dispensaries established and licensed pursuant to chapter 329D[;] or cannabis establishments established and licensed pursuant to part of chapter 329; provided that the land is otherwise zoned for agriculture, manufacturing, or retail purposes."
170170
171171 SECTION 4. Section 235-2.4, Hawaii Revised Statutes, is amended by amending subsection (v) to read as follows:
172172
173173 "(v) Section 280E (with respect to expenditures in connection with the illegal sale of drugs) of the Internal Revenue Code shall be operative for the purposes of this chapter, except that section 280E shall not be operative with respect to the production and sale of [medical]:
174174
175175 (1) Medical cannabis and manufactured cannabis products by dispensaries licensed under chapter 329D and their subcontractors, as defined in section 329D-1[.]; and
176176
177177 (2) Cannabis and cannabis products by cannabis establishments licensed under part of chapter 329."
178178
179179 SECTION 5. Section 237-31, Hawaii Revised Statutes, is amended to read as follows:
180180
181181 "§237-31 Remittances. All remittances of taxes imposed by this chapter shall be made by money, bank draft, check, cashier's check, money order, or certificate of deposit to the office of the department of taxation to which the return was transmitted. The department shall issue its receipts therefor to the taxpayer and shall pay the moneys into the state treasury as a state realization, to be kept and accounted for as provided by law; provided that:
182182
183183 (1) A sum, not to exceed $5,000,000, from all general excise tax revenues realized by the State shall be deposited in the state treasury in each fiscal year to the credit of the compound interest bond reserve fund;
184184
185185 (2) A sum from all general excise tax revenues realized by the State that is equal to one-half of the total amount of funds appropriated or transferred out of the hurricane reserve trust fund under sections 4 and 5 of Act 62, Session Laws of Hawaii 2011, shall be deposited into the hurricane reserve trust fund in fiscal year 2013-2014 and in fiscal year 2014-2015; provided that the deposit required in each fiscal year shall be made by October 1 of that fiscal year; [and]
186186
187187 (3) A sum equal to per cent of any general excise tax revenues realized from retail cannabis sales transactions, conducted pursuant to and in compliance with part of chapter 329, shall be paid to the director of finance of the county in which the revenues were collected; and
188188
189189 [[(3)]] (4) Commencing with fiscal year 2018-2019, a sum from all general excise tax revenues realized by the State that represents the difference between the state public employer's annual required contribution for the separate trust fund established under section 87A-42 and the amount of the state public employer's contributions into that trust fund shall be deposited to the credit of the State's annual required contribution into that trust fund in each fiscal year, as provided in section 87A-42."
190190
191191 SECTION 6. Section 321-30.1, Hawaii Revised Statutes, is amended by amending its title and subsections (a) and (b) to read as follows:
192192
193193 "§321-30.1 [Medical cannabis] Cannabis registry and regulation special fund; established. (a) There is established within the state treasury the [medical] cannabis registry and regulation special fund. The fund shall be expended at the discretion of the director of health:
194194
195195 (1) To establish and regulate a system of medical cannabis dispensaries in the State;
196196
197197 (2) To offset the cost of the processing and issuance of patient registry identification certificates and primary caregiver registration certificates;
198198
199199 (3) To fund positions and operating costs authorized by the legislature;
200200
201201 (4) To establish and manage a secure and confidential database;
202202
203203 (5) To fund public education as required by section 329D‑26;
204204
205205 (6) To fund substance abuse prevention and education programs; [and]
206206
207207 (7) To regulate cannabis establishments in the State pursuant to part of chapter 329; and
208208
209209 [(7)] (8) For any other expenditure necessary, consistent with this chapter [and], chapter 329D, and part of chapter 329, to implement medical cannabis registry and regulation programs[.] and cannabis establishment regulation programs.
210210
211211 (b) The fund shall consist of all moneys derived from fees collected pursuant to subsection (c) [and], section 329D-4[.], and part of chapter 329. There is established within the [medical] cannabis registry and regulation special fund:
212212
213213 (1) A medical cannabis registry program sub-account, into which shall be deposited all fees collected pursuant to subsection (c); [and]
214214
215215 (2) A medical cannabis dispensary program sub-account, into which shall be deposited all fees collected pursuant to section 329D-4[.]; and
216216
217217 (3) A cannabis establishment program sub-account, into which shall be deposited fees collected and allocated pursuant to part of chapter 329."
218218
219219 SECTION 7. Section 329-43.5, Hawaii Revised Statutes, is amended by amending subsection (e) to read as follows:
220220
221221 "(e) Subsections (a) and (b) shall not apply to a person who is authorized to:
222222
223223 (1) Acquire, possess, cultivate, use, distribute, or transport cannabis pursuant to the definition of "medical use" under section 329-121, while the person is facilitating the medical use of cannabis by a qualifying patient; [or]
224224
225225 (2) Dispense, manufacture, or produce cannabis or manufactured cannabis products pursuant to and in compliance with chapter 329D, while the person is facilitating the medical use of cannabis by a qualifying patient pursuant to part IX of chapter 329[.]; or
226226
227227 (3) Grow, process, possess, transfer, display, transport, or use cannabis or cannabis products pursuant to and in compliance with part of this chapter."
228228
229229 SECTION 8. Section 712-1240.1, Hawaii Revised Statutes, is amended by amending subsection (2) to read as follows:
230230
231231 "(2) It is an affirmative defense to prosecution for any marijuana-related offense defined in this part that the person who possessed or distributed the marijuana was authorized to possess or distribute the marijuana for medical purposes pursuant to part IX of chapter 329[.] or acted in accordance with part of that chapter."
232232
233233 SECTION 9. Section 712-1248, Hawaii Revised Statutes, is amended by amending subsection (1) to read as follows:
234234
235235 "(1) A person commits the offense of promoting a detrimental drug in the second degree if the person knowingly:
236236
237237 (a) Possesses fifty or more capsules or tablets containing one or more of the Schedule V substances;
238238
239239 (b) Possesses one or more preparations, compounds, mixtures, or substances, of an aggregate weight of one- eighth ounce or more, containing one or more of the Schedule V substances;
240240
241241 (c) Possesses one or more preparations, compounds, mixtures, or substances, of an aggregate weight of one ounce or more, containing any marijuana[; or], and the person is under the age of twenty-one;
242242
243243 (d) Possesses one or more preparations, compounds, mixtures, or substances, of an aggregate weight of more than one ounce, containing any marijuana, and the person is twenty-one years of age or older, except as provided under part of chapter 329; or
244244
245245 [(d)] (e) Distributes any marijuana or any Schedule V substance in any amount."
246246
247247 SECTION 10. Section 712-1249, Hawaii Revised Statutes, is amended by amending subsection (1) to read as follows:
248248
249249 "(1) A person commits the offense of promoting a detrimental drug in the third degree if the person knowingly possesses any marijuana or any Schedule V substance in any amount[.]; provided that, regarding marijuana, this subsection shall not apply to a person twenty-one years of age or older."
250250
251251 SECTION 11. Section 712-1249.5, Hawaii Revised Statutes, is amended by amending subsection (1) to read as follows:
252252
253253 "(1) A person commits the offense of commercial promotion of marijuana in the second degree if the person knowingly:
254254
255255 (a) Possesses marijuana having an aggregate weight of two pounds or more;
256256
257257 (b) Distributes marijuana having an aggregate weight of one pound or more;
258258
259259 (c) Possesses, cultivates, or has under the person's control fifty or more marijuana plants;
260260
261261 (d) Cultivates on land owned by another person, including land owned by the government or other legal entity, any marijuana plant, unless the person has the express permission from the owner of the land to cultivate the marijuana or the person has a legal or an equitable ownership interest in the land or the person has a legal right to occupy the land; [or]
262262
263263 (e) Sells or barters any [marijuana or any] Schedule V substance in any amount to a minor[.]; or
264264
265265 (f) Sells or barters any marijuana in any amount to a person under the age of twenty-one."
266266
267267 SECTION 12. Section 329-130, Hawaii Revised Statutes, is repealed.
268268
269269 ["§329-130 Authorized sources of medical cannabis. (a) After December 31, 2023, a qualifying patient shall obtain medical cannabis or manufactured cannabis products only:
270270
271271 (1) From a dispensary licensed pursuant to chapter 329D; provided that the cannabis shall be purchased and paid for at the time of purchase; or
272272
273273 (2) By cultivating cannabis in an amount that does not exceed an adequate supply for the qualifying patient, pursuant to section 329-122; provided that each location used to cultivate cannabis shall be used by no more than five qualifying patients.
274274
275275 After December 31, 2023, no primary caregiver shall be authorized to cultivate cannabis for any qualifying patient.
276276
277277 (b) This section shall not apply to:
278278
279279 (1) A qualifying patient who is a minor or an adult lacking legal capacity and the primary caregiver is the parent, guardian, or person having legal custody of a qualifying patient described in this paragraph; or
280280
281281 (2) A qualifying patient on any island on which there is no medical cannabis dispensary licensed pursuant to chapter 329D.
282282
283283 (c) A qualifying out-of-state patient and a caregiver of a qualifying out-of-state patient shall be authorized to obtain cannabis for medical use only from retail dispensing locations of dispensaries licensed pursuant to chapter 329D."]
284284
285285 SECTION 13. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.
286286
287287 SECTION 14. If any provision of this Act, or the application thereof to any person or circumstance, is held invalid, the invalidity does not affect other provisions or applications of the Act that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.
288288
289289 SECTION 15. In codifying the new sections added by section 2 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.
290290
291291 SECTION 16. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
292292
293293 SECTION 17. This Act shall take effect on January 1, 2022; provided that section 4 shall apply to taxable years beginning after December 31, 2021.
294294
295295
296296
297297 INTRODUCED BY: _____________________________
298298
299299 INTRODUCED BY:
300300
301301 _____________________________
302302
303303
304304
305305
306306
307307 Report Title: Cannabis; Recreational Use; Legalization; Regulation; Taxation Description: Authorizes persons 21 years of age or older to possess or use limited amounts of cannabis for recreational purposes. Authorizes the licensing, regulation, and taxation of cannabis cultivation, manufacturing, testing, and retail sales facilities. Specifies that only existing medical cannabis dispensary licensees may apply for licensure as a cannabis establishment, but may be permitted to establish additional retail dispensing locations. Allocates an unspecified percentage of general excise tax revenues derived from retail cannabis sales transactions to the counties. Specifies the application and non-application of the Internal Revenue Code to expenses related to the production and sale of cannabis and cannabis products for state income tax purposes. Amends certain provisions of the penal code relating to offenses involving marijuana and expands the affirmative defense to prosecution to include persons acting in accordance with the new part in Chapter 329, HRS, created by Section 2 of this Act. Repeals limitations on authorized sources of medical cannabis. The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.
308308
309309
310310
311311
312312
313313 Report Title:
314314
315315 Cannabis; Recreational Use; Legalization; Regulation; Taxation
316316
317317
318318
319319 Description:
320320
321321 Authorizes persons 21 years of age or older to possess or use limited amounts of cannabis for recreational purposes. Authorizes the licensing, regulation, and taxation of cannabis cultivation, manufacturing, testing, and retail sales facilities. Specifies that only existing medical cannabis dispensary licensees may apply for licensure as a cannabis establishment, but may be permitted to establish additional retail dispensing locations. Allocates an unspecified percentage of general excise tax revenues derived from retail cannabis sales transactions to the counties. Specifies the application and non-application of the Internal Revenue Code to expenses related to the production and sale of cannabis and cannabis products for state income tax purposes. Amends certain provisions of the penal code relating to offenses involving marijuana and expands the affirmative defense to prosecution to include persons acting in accordance with the new part in Chapter 329, HRS, created by Section 2 of this Act. Repeals limitations on authorized sources of medical cannabis.
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323323
324324
325325
326326
327327
328328
329329 The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.