Texas 2023 - 88th Regular

Texas House Bill HB1831 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New	Differences
1	1	88R4386 JSC-F
2	2	By: Talarico H.B. No. 1831
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the regulation of the cultivation, manufacture,
8	8	processing, distribution, sale, testing, transportation, delivery,
9	9	transfer, possession, use, and taxation of cannabis and cannabis
10	10	products and the local regulation of cannabis establishments;
11	11	providing for expunction of records relating to certain
12	12	decriminalized conduct; authorizing the imposition of fees;
13	13	requiring an occupational license; creating a criminal offense;
14	14	imposing a tax.
15	15	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
16	16	ARTICLE 1. SHORT TITLE
17	17	SECTION 1.01. This Act may be cited as the Texas Regulation
18	18	of Cannabis Act.
19	19	ARTICLE 2. REGULATION AND TAXATION OF CANNABIS
20	20	SECTION 2.01. Subtitle C, Title 6, Health and Safety Code,
21	21	is amended by adding Chapter 491 to read as follows:
22	22	CHAPTER 491. REGULATION OF CANNABIS
23	23	SUBCHAPTER A. GENERAL PROVISIONS
24	24	Sec. 491.0001. DEFINITIONS. In this chapter:
25	25	(1) "Adult" means an individual 21 years of age or
26	26	older.
27	27	(2) "Cannabis" means the plant Cannabis sativa L.,
28	28	whether growing or not, the seeds of that plant, and every compound,
29	29	manufacture, salt, derivative, mixture, or preparation of that
30	30	plant or its seeds. The term includes cannabis concentrate. The
31	31	term does not include:
32	32	(A) the mature stalks of the plant or fiber
33	33	produced from the stalks;
34	34	(B) oil or cake made from the seeds of the plant;
35	35	(C) a compound, manufacture, salt, derivative,
36	36	mixture, or preparation of the mature stalks, fiber, oil, or cake;
37	37	(D) the sterilized seeds of the plant that are
38	38	incapable of beginning germination;
39	39	(E) hemp, as that term is defined by Section
40	40	121.001, Agriculture Code; or
41	41	(F) a consumable hemp product, as that term is
42	42	defined by Section 443.001.
43	43	(3) "Cannabis concentrate" means the resin extracted
44	44	from a part of the plant Cannabis sativa L. or a compound,
45	45	manufacture, salt, derivative, mixture, or preparation of the
46	46	resin.
47	47	(4) "Cannabis establishment" means an entity licensed
48	48	by the department under this chapter to process and dispense
49	49	cannabis and cannabis products to an adult.
50	50	(5) "Cannabis grower" means an entity licensed by the
51	51	department to cultivate cannabis for sale and distribution to a
52	52	cannabis establishment.
53	53	(6) "Cannabis product" means a product that contains
54	54	cannabis and is intended for use or consumption by humans,
55	55	including as an edible product or as a topical product, ointment,
56	56	oil, or tincture. The term includes products that consist of
57	57	cannabis and other ingredients.
58	58	(7) "Cannabis-related drug paraphernalia" means
59	59	equipment, a product, or material that is used or intended for use
60	60	in:
61	61	(A) planting, propagating, cultivating, growing,
62	62	harvesting, manufacturing, compounding, converting, producing,
63	63	processing, preparing, testing, analyzing, packaging, repackaging,
64	64	storing, or containing cannabis or a cannabis product; or
65	65	(B) introducing cannabis or a cannabis product
66	66	into the human body.
67	67	(8) "Cannabis secure transporter" means an entity
68	68	licensed by the department under this chapter to transport cannabis
69	69	from a cannabis grower to a cannabis establishment.
70	70	(9) "Cannabis testing facility" means an entity
71	71	licensed by the department under this chapter to analyze the safety
72	72	and potency of cannabis and cannabis products.
73	73	(10) "Commission" means the Texas Commission of
74	74	Licensing and Regulation.
75	75	(11) "Cultivate" means to propagate, breed, grow,
76	76	harvest, dry, cure, or separate parts of the cannabis plant by
77	77	manual or mechanical means.
78	78	(12) "Department" means the Texas Department of
79	79	Licensing and Regulation.
80	80	(13) "Executive director" means the executive
81	81	director of the department.
82	82	(14) "Marihuana" has the meaning assigned by Section
83	83	481.002.
84	84	(15) "Process" means to separate or otherwise prepare
85	85	parts of the cannabis plant and to compound, blend, extract,
86	86	infuse, or otherwise make or prepare cannabis concentrate or
87	87	cannabis products.
88	88	SUBCHAPTER B. PROTECTIONS FROM LEGAL ACTION RELATED TO CANNABIS
89	89	Sec. 491.0051. AUTHORIZED CONDUCT: PERSONAL USE OF
90	90	CANNABIS. An adult is authorized under this chapter to:
91	91	(1) use, possess, and transport not more than 2.5
92	92	ounces of cannabis, except that not more than 15 grams of that
93	93	amount may be in the form of cannabis concentrate;
94	94	(2) transfer without remuneration to another adult not
95	95	more than 2.5 ounces of cannabis, except that not more than 15 grams
96	96	of that amount may be in the form of cannabis concentrate and
97	97	provided that the transfer is not advertised or promoted to the
98	98	public;
99	99	(3) cultivate for personal use not more than 12
100	100	cannabis plants in an area on the premises of the adult's private
101	101	residence, provided that the cultivation occurs in an enclosed area
102	102	that is:
103	103	(A) equipped with locks or other security devices
104	104	that restrict access to the area; and
105	105	(B) not visible from a public place without the
106	106	use of aircraft or optical aids;
107	107	(4) possess, store, or process on the premises of the
108	108	adult's private residence not more than:
109	109	(A) the amount of cannabis produced from cannabis
110	110	plants cultivated on the premises, provided that:
111	111	(i) not more than 12 cannabis plants are
112	112	possessed, cultivated, or processed on the premises at one time;
113	113	and
114	114	(ii) any amount of cannabis in excess of 2.5
115	115	ounces is stored in a container or area equipped with locks or other
116	116	security devices that restrict access to the contents of the
117	117	container or area; and
118	118	(B) 10 ounces of cannabis that were not produced
119	119	from cannabis plants cultivated on the premises, provided that the
120	120	amount in excess of 2.5 ounces is stored in a container or area
121	121	described by Paragraph (A)(ii);
122	122	(5) use, possess, process, transport, or transfer to
123	123	another adult without remuneration an amount of cannabis products
124	124	specified by rule of the commission as the allowable amount of
125	125	cannabis for purposes of this subdivision; and
126	126	(6) use, possess, transport, or transfer to another
127	127	adult without remuneration cannabis-related drug paraphernalia.
128	128	Sec. 491.0052. AUTHORIZED CONDUCT: RETAIL CANNABIS
129	129	OPERATIONS. This chapter authorizes the conduct of:
130	130	(1) a cannabis grower director, manager, or employee
131	131	who, acting within the scope of the grower's license:
132	132	(A) cultivates cannabis or produces cannabis
133	133	products for sale or transfer to a cannabis establishment; and
134	134	(B) possesses cannabis or cannabis-related drug
135	135	paraphernalia;
136	136	(2) a cannabis establishment director, manager, or
137	137	employee who, acting within the scope of the establishment's
138	138	license, possesses cannabis or cannabis products or transfers or
139	139	sells cannabis, cannabis products, or cannabis-related drug
140	140	paraphernalia to an adult;
141	141	(3) a cannabis secure transporter director, manager,
142	142	or employee who, acting within the scope of the secure
143	143	transporter's license, transports, transfers, or delivers cannabis
144	144	or cannabis products from a cannabis grower to a cannabis
145	145	establishment; and
146	146	(4) a cannabis testing facility director, manager, or
147	147	employee who, acting within the scope of the facility's license,
148	148	possesses or tests cannabis, cannabis products, or
149	149	cannabis-related drug paraphernalia.
150	150	Sec. 491.0053. PROTECTION FROM LEGAL ACTION FOR AUTHORIZED
151	151	CONDUCT. (a) A person is not subject to arrest, prosecution,
152	152	forfeiture of property, or penalty in any manner or denial of any
153	153	right or privilege, including any civil penalty or disciplinary
154	154	action by a court or occupational or professional licensing board
155	155	or bureau solely due to conduct authorized under Section 491.0051
156	156	or 491.0052.
157	157	(b) The fact that a person engages in conduct authorized by
158	158	Section 491.0051 or 491.0052 does not in itself constitute grounds
159	159	for denying, limiting, or restricting conservatorship or
160	160	possession of or access to a child under Title 5, Family Code.
161	161	Sec. 491.0054. PROHIBITION OF CANNABIS ON PRIVATE PROPERTY;
162	162	EXCEPTION. (a) Except as otherwise provided by Subsection (b), a
163	163	person may prohibit or restrict the possession, consumption,
164	164	cultivation, distribution, processing, sale, or display of
165	165	cannabis or cannabis products on property the person owns,
166	166	occupies, or manages.
167	167	(b) A person may not prohibit a residential tenant under a
168	168	lease agreement from possessing cannabis, cannabis products, or
169	169	cannabis-related drug paraphernalia or consuming cannabis by means
170	170	other than smoking on the premises.
171	171	Sec. 491.0055. CONDUCT NOT AUTHORIZED UNDER THIS CHAPTER.
172	172	This chapter does not authorize the following conduct:
173	173	(1) operating a motor vehicle while intoxicated or
174	174	otherwise violating Chapter 49, Penal Code;
175	175	(2) smoking or otherwise consuming cannabis in:
176	176	(A) a motor vehicle while the vehicle is on a
177	177	public road;
178	178	(B) an aircraft, while the aircraft is in flight
179	179	or in a public area;
180	180	(C) a watercraft, while the watercraft is on a
181	181	public waterway; or
182	182	(D) a public place, unless:
183	183	(i) the public place is an area designated
184	184	by the applicable political subdivision as an area where using
185	185	cannabis is permissible; and
186	186	(ii) the area described by Subparagraph (i)
187	187	is not accessible to persons younger than 21 years of age;
188	188	(3) possessing or consuming cannabis or cannabis
189	189	products or possessing cannabis-related drug paraphernalia:
190	190	(A) on the premises of a public or private
191	191	child-care facility, prekindergarten, or primary or secondary
192	192	school;
193	193	(B) on a school bus that serves a facility or
194	194	school described by Paragraph (A); or
195	195	(C) on the premises of a correctional facility,
196	196	as defined by Article 18A.251, Code of Criminal Procedure, or a
197	197	civil commitment facility; or
198	198	(4) separating resin from the cannabis plant by butane
199	199	extraction or another method that uses a substance with a
200	200	flashpoint below 100 degrees Fahrenheit in a public place or motor
201	201	vehicle or within the curtilage of a residential structure.
202	202	SUBCHAPTER C. DUTIES OF COMMISSION AND DEPARTMENT
203	203	Sec. 491.0101. DUTIES OF DEPARTMENT. The department shall
204	204	administer this chapter.
205	205	Sec. 491.0102. RULES; FEES. (a) The commission shall adopt
206	206	all necessary rules for the administration and enforcement of this
207	207	chapter, including rules imposing fees under this chapter in
208	208	amounts sufficient to cover the cost of administering this chapter.
209	209	(b) The commission by rule shall set application and license
210	210	fees under this chapter in amounts sufficient to administer this
211	211	chapter and may annually adjust the fees for inflation.
212	212	(c) A fee collected under this chapter shall be deposited to
213	213	the credit of the cannabis regulation account established under
214	214	Section 491.0251.
215	215	(d) The commission shall adopt rules for the reasonable
216	216	regulation of cannabis growers and cannabis establishments,
217	217	including rules that:
218	218	(1) restrict the use of dangerous pesticides;
219	219	(2) regulate the packaging and labeling of cannabis
220	220	products available at a cannabis establishment;
221	221	(3) restrict advertising and display of cannabis and
222	222	cannabis products;
223	223	(4) restrict the maximum amount of
224	224	tetrahydrocannabinol that may be contained in a cannabis product
225	225	sold to a consumer;
226	226	(5) require recordkeeping and monitoring to track the
227	227	transfer of cannabis and cannabis products between license holders;
228	228	and
229	229	(6) require security measures, provided that the
230	230	security measures do not restrict the cultivation of cannabis
231	231	outdoors or in greenhouses.
232	232	Sec. 491.0103. TESTING, PACKAGING, AND LABELING STANDARDS.
233	233	(a) The commission by rule shall establish standards for:
234	234	(1) the operation of cannabis testing facilities;
235	235	(2) the testing of cannabis and cannabis products; and
236	236	(3) packaging and labeling requirements for cannabis
237	237	and cannabis products.
238	238	(b) In establishing standards for packaging and labeling
239	239	requirements under Subsection (a)(3), the commission shall require
240	240	that:
241	241	(1) cannabis and cannabis products be packaged in
242	242	opaque, resealable, child-resistant packaging that does not
243	243	resemble and may not be easily confused with typical packaging for
244	244	commercially sold candy;
245	245	(2) cannabis and cannabis products be clearly labeled;
246	246	and
247	247	(3) the label for a cannabis product disclose the
248	248	amount of cannabis contained in that product.
249	249	Sec. 491.0104. SECURE TRANSPORTATION OF CANNABIS. The
250	250	commission by rule shall establish standards applicable to cannabis
251	251	secure transporters, including standards to ensure all cannabis
252	252	establishments are properly served.
253	253	Sec. 491.0105. CONFLICT OF INTEREST. (a) A person who is
254	254	involved in the implementation, administration, or enforcement of
255	255	this chapter as a member of the commission, an employee of the
256	256	department, or a consultant to the commission or the department may
257	257	not also hold a pecuniary interest in any entity licensed by the
258	258	department under this chapter.
259	259	(b) A person who holds a pecuniary interest in a cannabis
260	260	testing facility or a cannabis secure transporter who holds a
261	261	license issued under this chapter may not hold a pecuniary interest
262	262	in any entity that holds a cannabis establishment or cannabis
263	263	grower license issued under this chapter.
264	264	(c) A person may not hold a pecuniary interest in more than
265	265	five entities that are licensed under this chapter as a cannabis
266	266	grower, except as provided by commission rule.
267	267	Sec. 491.0106. ANNUAL REPORT. The executive director shall
268	268	annually submit to the governor a report providing the following
269	269	information regarding licensing and regulation under this chapter:
270	270	(1) the number of applications received for each class
271	271	of license under this chapter;
272	272	(2) the number of licenses issued for each class of
273	273	license under this chapter;
274	274	(3) demographic information pertaining to license
275	275	holders;
276	276	(4) a description of any fines imposed on a license
277	277	holder or disciplinary actions taken against a license holder by
278	278	the department; and
279	279	(5) a statement of revenues and expenses of the
280	280	department related to the implementation, administration, and
281	281	enforcement of this chapter.
282	282	SUBCHAPTER D. LICENSING
283	283	Sec. 491.0151. LICENSE REQUIRED. A person must hold a
284	284	license issued by the department under this chapter to operate as a
285	285	cannabis grower, cannabis establishment, cannabis secure
286	286	transporter, or cannabis testing facility.
287	287	Sec. 491.0152. QUALIFICATIONS FOR LICENSURE. The
288	288	commission by rule shall provide for each class of license issued
289	289	under this chapter qualifications for licensure that are
290	290	demonstrably related to the operations authorized and duties
291	291	imposed under that class of license.
292	292	Sec. 491.0153. APPLICATION. (a) A person may apply for an
293	293	initial or renewal license under this chapter by submitting a form
294	294	prescribed by the department along with the application fee in an
295	295	amount set by commission rule.
296	296	(b) The application must indicate the class of license
297	297	sought and include the name and address of the applicant, the name
298	298	and address of each of the applicant's directors, managers, and
299	299	employees, and any other information considered necessary by the
300	300	department to determine the applicant's eligibility for the
301	301	license.
302	302	Sec. 491.0154. ISSUANCE, RENEWAL, OR DENIAL OF LICENSE.
303	303	(a) The department shall issue or renew a license under this
304	304	chapter only if:
305	305	(1) the department determines the applicant meets the
306	306	qualifications for the class of license sought established under
307	307	Section 491.0152; and
308	308	(2) the applicant is in compliance with any applicable
309	309	local regulations.
310	310	(b) If the department denies the issuance or renewal of a
311	311	license under Subsection (a), the department shall give written
312	312	notice of the grounds for denial to the applicant.
313	313	(c) A license issued or renewed under this section expires
314	314	as determined by commission rule and the department in accordance
315	315	with Section 51.406, Occupations Code.
316	316	Sec. 491.0155. DUTY TO MAINTAIN QUALIFICATIONS. A license
317	317	holder shall maintain compliance at all times with the
318	318	qualifications for the applicable class of license established
319	319	under Section 491.0152.
320	320	Sec. 491.0156. LICENSE SUSPENSION OR REVOCATION. (a) The
321	321	department may at any time suspend or revoke a license issued under
322	322	this chapter if the department determines that the license holder
323	323	has not maintained the qualifications established under Section
324	324	491.0152 or has failed to comply with a duty imposed under this
325	325	chapter.
326	326	(b) The department shall give written notice to a license
327	327	holder of a license suspension or revocation under this section and
328	328	the grounds for the suspension or revocation. The notice must be
329	329	sent by certified mail, return receipt requested.
330	330	(c) After suspending or revoking a license issued under this
331	331	chapter, the department shall notify the Department of Public
332	332	Safety. The public safety director of the Department of Public
333	333	Safety may seize or place under seal all cannabis, cannabis
334	334	products, and cannabis-related drug paraphernalia owned or
335	335	possessed by the license holder. If the license is revoked, a
336	336	disposition may not be made of the seized or sealed cannabis,
337	337	cannabis products, or cannabis-related drug paraphernalia until
338	338	the time for administrative appeal of the order has elapsed or until
339	339	all appeals have been concluded. When a revocation order becomes
340	340	final, all cannabis, cannabis products, and cannabis-related drug
341	341	paraphernalia may be forfeited to the state as provided under
342	342	Subchapter E, Chapter 481.
343	343	(d) Chapter 2001, Government Code, applies to a proceeding
344	344	under this section.
345	345	Sec. 491.0157. CRIMINAL HISTORY BACKGROUND CHECK. (a) In
346	346	addition to satisfying the other requirements provided by
347	347	commission rule under this chapter, an applicant for a license
348	348	under this chapter must submit to the department a complete and
349	349	legible set of fingerprints, on a form prescribed by the
350	350	commission, for the purpose of obtaining criminal history record
351	351	information from the Department of Public Safety and the Federal
352	352	Bureau of Investigation.
353	353	(b) The department may deny a license to an applicant who
354	354	does not comply with the requirement of Subsection (a). Issuance of
355	355	a license by the department is conditioned on the department
356	356	obtaining the applicant's criminal history record information
357	357	under this section.
358	358	(c) The commission by rule shall establish criteria for
359	359	determining whether a person passes the criminal history background
360	360	check for purposes of this section. The rules adopted under this
361	361	section may not disqualify a person for licensure solely for a
362	362	conviction of an offense that involves the possession of marihuana
363	363	or the delivery of marihuana to a person 18 years of age or older.
364	364	SUBCHAPTER E. DUTIES OF LICENSE HOLDERS
365	365	Sec. 491.0201. DUTIES RELATING TO DISPENSING CANNABIS OR
366	366	CANNABIS PRODUCTS. Before dispensing cannabis or cannabis products
367	367	to an adult, a cannabis establishment must make reasonable efforts
368	368	to verify that:
369	369	(1) the person receiving the cannabis or cannabis
370	370	product is an adult;
371	371	(2) the cannabis or cannabis product complies with
372	372	department testing and labeling rules; and
373	373	(3) the amount dispensed is not greater than the
374	374	amount of cannabis or cannabis product allowed for personal use as
375	375	provided by Section 491.0051.
376	376	Sec. 491.0202. DUTIES RELATING TO SECURITY. (a) A license
377	377	holder shall ensure that the cultivation, processing, sale, or
378	378	display of cannabis, cannabis products, and cannabis-related drug
379	379	paraphernalia is not visible from a public place without the use of
380	380	optical aids or aircraft.
381	381	(b) A license holder may not cultivate, process, store, or
382	382	sell cannabis, cannabis products, or cannabis-related drug
383	383	paraphernalia at a location other than the physical address
384	384	approved by the department for the establishment under the license
385	385	issued to the establishment under this chapter.
386	386	(c) A license holder shall adopt reasonable security
387	387	measures necessary to restrict access to areas where cannabis,
388	388	cannabis products, or cannabis-related drug paraphernalia are
389	389	stored and to prevent theft of cannabis, cannabis products, and
390	390	cannabis-related drug paraphernalia.
391	391	Sec. 491.0203. LICENSE HOLDER OPERATIONS. (a) A license
392	392	holder may not employ or otherwise accept the services of a person
393	393	younger than 21 years of age.
394	394	(b) A cannabis establishment may not sell tobacco products,
395	395	as defined by Section 155.001, Tax Code.
396	396	Sec. 491.0204. MONTHLY SALES REPORT. A cannabis
397	397	establishment shall monthly submit a report to the comptroller
398	398	specifying the amount of cannabis sold, the number of cannabis
399	399	products sold, the number and types of cannabis-related drug
400	400	paraphernalia sold, and the amount of money collected in sales by
401	401	the establishment during the preceding month.
402	402	SUBCHAPTER F. FUNDING FOR REGULATION, OVERSIGHT, TESTING, AND
403	403	QUALITY CONTROL
404	404	Sec. 491.0251. CANNABIS REGULATION ACCOUNT. (a) The
405	405	cannabis regulation account is an account in the general revenue
406	406	fund administered by the department.
407	407	(b) The account consists of:
408	408	(1) money deposited to the credit of the account under
409	409	Section 166.0004, Tax Code; and
410	410	(2) fees deposited to the credit of the account under
411	411	Section 491.0102.
412	412	(c) Money in the account may be appropriated only to the
413	413	department for implementing and administering this chapter.
414	414	Sec. 491.0252. CANNABIS TESTING AND QUALITY CONTROL
415	415	ACCOUNT. (a) The cannabis testing and quality control account is
416	416	an account in the general revenue fund administered by the
417	417	Department of Public Safety.
418	418	(b) The account consists of money deposited to the credit of
419	419	the account under Section 166.0004, Tax Code.
420	420	(c) Money in the account may be appropriated only to the
421	421	Department of Public Safety for monitoring compliance with testing
422	422	and quality control requirements imposed on license holders by this
423	423	chapter or by commission rules adopted under this chapter.
424	424	Sec. 491.0253. CANNABIS ESTABLISHMENT REGULATION AND
425	425	OVERSIGHT LOCAL SHARE ACCOUNT; PAYMENT FROM ACCOUNT. (a) In this
426	426	section:
427	427	(1) "Account" means the cannabis establishment
428	428	regulation and oversight local share account created under this
429	429	section.
430	430	(2) "Fiscal year" means the fiscal year of a
431	431	qualifying local government.
432	432	(3) "Qualifying local government" means a
433	433	municipality or county in which at least one cannabis establishment
434	434	is located during any portion of the applicable fiscal year.
435	435	(b) The cannabis establishment regulation and oversight
436	436	local share account is an account in the general revenue fund
437	437	administered by the comptroller.
438	438	(c) The account consists of money deposited to the credit of
439	439	the account under Section 166.0004, Tax Code.
440	440	(d) Money in the account may be used by the comptroller only
441	441	to make a cannabis establishment regulation assistance payment to a
442	442	qualifying local government in the manner provided by this section.
443	443	(e) To serve the state purpose of ensuring that local
444	444	governments in which cannabis establishments are located may
445	445	effectively participate in the regulation and oversight of those
446	446	establishments, a qualifying local government is entitled to a
447	447	cannabis establishment regulation assistance payment from the
448	448	state for each fiscal year that the local government is a qualifying
449	449	local government.
450	450	(f) Except as provided by Subsection (j), the amount of the
451	451	cannabis establishment regulation assistance payment to which a
452	452	qualifying local government is entitled for a fiscal year is equal
453	453	to the cost incurred by the local government to enforce regulations
454	454	adopted under Subchapter G.
455	455	(g) Not later than April 1 of the year following the end of a
456	456	fiscal year for which a qualifying local government is entitled to a
457	457	cannabis establishment regulation assistance payment, the
458	458	qualifying local government may submit an application to the
459	459	comptroller to receive a cannabis establishment regulation
460	460	assistance payment for that fiscal year. The application must be
461	461	made on a form prescribed by the comptroller. The comptroller may
462	462	require the qualifying local government to submit any information
463	463	the comptroller needs to determine the amount of the cannabis
464	464	establishment regulation assistance payment to which the
465	465	qualifying local government is entitled.
466	466	(h) A qualifying local government that does not submit an
467	467	application to the comptroller by the date prescribed by Subsection
468	468	(g) is not entitled to a cannabis establishment regulation
469	469	assistance payment for the fiscal year for which that deadline
470	470	applies.
471	471	(i) The comptroller shall review each application by a local
472	472	government to determine whether the local government is entitled to
473	473	a cannabis establishment regulation assistance payment. If the
474	474	comptroller determines that the local government is entitled to the
475	475	payment, the comptroller shall remit the payment using available
476	476	money in the account to the qualifying local government not later
477	477	than the 30th day after the date the application for the payment is
478	478	made.
479	479	(j) If at the time a cannabis establishment regulation
480	480	assistance payment must be remitted to a qualifying local
481	481	government under Subsection (i) the comptroller determines the
482	482	available amount in the account is insufficient to make the
483	483	payment, the comptroller may reduce the amount of the payment to the
484	484	qualifying local government. If more than one payment must be
485	485	remitted at a time when the available amount in the account is
486	486	insufficient to make those payments, the comptroller shall make
487	487	reduced payments to each qualifying local government. The
488	488	comptroller shall allocate the reductions in the amount of the
489	489	payments in a manner that is proportionate to the number of cannabis
490	490	establishments in each qualifying local government.
491	491	(k) The comptroller shall adopt rules necessary to
492	492	implement this section.
493	493	SUBCHAPTER G. LOCAL REGULATION AND OVERSIGHT
494	494	Sec. 491.0301. DEFINITION. In this subchapter, "health
495	495	authority" has the meaning assigned by Section 431.002.
496	496	Sec. 491.0302. PROHIBITED LOCAL REGULATION. A political
497	497	subdivision of this state may not enact, adopt, or enforce a rule,
498	498	ordinance, order, resolution, or other regulation that prohibits or
499	499	unreasonably restricts the cultivation, production, processing,
500	500	dispensing, transportation, or possession of cannabis or cannabis
501	501	products or the operation of a cannabis grower, cannabis
502	502	establishment, cannabis secure transporter, or cannabis testing
503	503	facility as authorized by this chapter.
504	504	Sec. 491.0303. PERMISSIBLE LOCAL REGULATION. A political
505	505	subdivision may adopt regulations consistent with this chapter
506	506	governing the hours of operation, location, manner of conducting
507	507	business, and number of cannabis growers, cannabis establishments,
508	508	or cannabis testing facilities.
509	509	Sec. 491.0304. PUBLIC HEALTH INSPECTIONS. A health
510	510	authority may, on presenting appropriate credentials to the license
511	511	holder or employee of the cannabis establishment:
512	512	(1) enter at reasonable times the premises of a
513	513	cannabis establishment;
514	514	(2) enter a vehicle being used to transport cannabis;
515	515	or
516	516	(3) inspect at reasonable times, within reasonable
517	517	limits, and in a reasonable manner, the establishment or vehicle
518	518	and all equipment, finished and unfinished materials, containers,
519	519	and labeling of any item.
520	520	Sec. 491.0305. COMPLAINTS. (a) A political subdivision or
521	521	health authority shall maintain a record of any complaints made to
522	522	the political subdivision or health authority regarding the
523	523	operations of a cannabis establishment.
524	524	(b) A political subdivision or health authority shall
525	525	investigate a complaint or refer the complaint to the department,
526	526	as appropriate.
527	527	SUBCHAPTER H. SALE OR DISTRIBUTION OF CANNABIS OR CANNABIS PRODUCT
528	528	TO MINORS PROHIBITED
529	529	Sec. 491.0351. DEFINITION. In this subchapter, "minor"
530	530	means a person younger than 21 years of age.
531	531	Sec. 491.0352. SALE OR DISTRIBUTION OF CANNABIS OR CANNABIS
532	532	PRODUCT TO MINORS PROHIBITED; PROOF OF AGE REQUIRED. (a) A person
533	533	commits an offense if the person, under the authority of this
534	534	chapter:
535	535	(1) sells, gives, or causes to be sold or given
536	536	cannabis or cannabis products to a minor; or
537	537	(2) sells, gives, or causes to be sold or given
538	538	cannabis or cannabis products to another person who intends to
539	539	deliver the cannabis or cannabis products to a minor.
540	540	(b) If an offense under this section occurs in connection
541	541	with a sale by an employee of the owner of a cannabis establishment,
542	542	the employee is criminally responsible for the offense and is
543	543	subject to prosecution.
544	544	(c) An offense under this section is a Class C misdemeanor.
545	545	(d) It is a defense to prosecution under Subsection (a)(1)
546	546	that the person to whom the cannabis or cannabis products were sold
547	547	or given presented to the defendant apparently valid proof of
548	548	identification.
549	549	(e) A proof of identification satisfies the requirements of
550	550	Subsection (d) if it contains a physical description and photograph
551	551	consistent with the person's appearance, purports to establish that
552	552	the person is 21 years of age or older, and was issued by a
553	553	governmental agency. The proof of identification may include a
554	554	driver's license issued by this state or another state, a passport,
555	555	or an identification card issued by a state or the federal
556	556	government.
557	557	SECTION 2.02. Subchapter C, Chapter 42, Human Resources
558	558	Code, is amended by adding Section 42.069 to read as follows:
559	559	Sec. 42.069. CHILD-CARE SERVICES PROGRAM SUPPORT ACCOUNT.
560	560	(a) The child-care services program support account is an account
561	561	in the general revenue fund administered by the department.
562	562	(b) The account consists of money deposited to the account
563	563	under Section 166.0004, Tax Code.
564	564	(c) Money in the account may be appropriated only to the
565	565	department for the purpose of increasing subsidy funding for the
566	566	child-care services program.
567	567	SECTION 2.03. Subtitle E, Title 2, Tax Code, is amended by
568	568	adding Chapter 166 to read as follows:
569	569	CHAPTER 166. TAX ON CANNABIS AND RELATED PRODUCTS
570	570	Sec. 166.0001. DEFINITIONS. In this chapter, "cannabis"
571	571	and "cannabis product" have the meanings assigned by Section
572	572	491.0001, Health and Safety Code.
573	573	Sec. 166.0002. CANNABIS SALES TAX. (a) A tax is imposed on
574	574	each sale in this state of cannabis and cannabis products.
575	575	(b) The tax rate is 10 percent of the sales price of cannabis
576	576	or a cannabis product.
577	577	Sec. 166.0003. APPLICATION OF OTHER PROVISIONS OF CODE.
578	578	(a) The tax imposed under this chapter is in addition to the taxes
579	579	imposed under Chapter 151.
580	580	(b) Except as provided by this chapter:
581	581	(1) the tax imposed under this chapter is
582	582	administered, imposed, collected, and enforced in the same manner
583	583	as the taxes under Chapter 151 are administered, imposed,
584	584	collected, and enforced; and
585	585	(2) the provisions of Chapter 151 applicable to the
586	586	sales tax imposed under Subchapter C, Chapter 151, apply to the tax
587	587	imposed under this chapter.
588	588	Sec. 166.0004. DISPOSITION OF PROCEEDS. The comptroller
589	589	shall deposit the proceeds from the tax imposed under this chapter
590	590	as follows:
591	591	(1) 10 percent to the credit of the cannabis
592	592	regulation account under Section 491.0251, Health and Safety Code;
593	593	(2) 10 percent to the credit of the cannabis testing
594	594	and quality control account under Section 491.0252, Health and
595	595	Safety Code;
596	596	(3) 20 percent to the credit of the cannabis
597	597	establishment regulation and oversight local share account under
598	598	Section 491.0253, Health and Safety Code; and
599	599	(4) the remainder to the credit of the child-care
600	600	services program support account under Section 42.069, Human
601	601	Resources Code.
602	602	ARTICLE 3. EXPUNCTION
603	603	SECTION 3.01. Chapter 55, Code of Criminal Procedure, is
604	604	amended by adding Article 55.012 to read as follows:
605	605	Art. 55.012. EXPUNCTION OF ARREST RECORDS AND FILES FOR
606	606	CERTAIN MARIHUANA OR CANNABIS OFFENSES. (a) This article applies
607	607	only to an offense under Section 481.116 or 481.121, Health and
608	608	Safety Code, that involved only conduct that would have been
609	609	authorized under Section 491.0051 of that code if that conduct had
610	610	occurred on or after September 1, 2023.
611	611	(b) A person who has been placed under a custodial or
612	612	noncustodial arrest for an offense described by Subsection (b) that
613	613	was committed before September 1, 2023, is entitled to the
614	614	expunction of all records and files related to the arrest,
615	615	including, as applicable, any records and files related to a
616	616	conviction of the offense, if:
617	617	(1) the person is convicted of or placed on deferred
618	618	adjudication community supervision under Subchapter C, Chapter
619	619	42A, for the offense for which the person was arrested; and
620	620	(2) as applicable:
621	621	(A) the person's sentence, including any term of
622	622	confinement or period of community supervision imposed and payment
623	623	of all fines and costs imposed, is finally discharged; or
624	624	(B) the person received a dismissal and discharge
625	625	under Article 42A.111 for the offense.
626	626	(c) The person must submit an ex parte petition for
627	627	expunction to the court that convicted the person or placed the
628	628	person on deferred adjudication community supervision. The
629	629	petition must be verified and must contain the information
630	630	described by Section 2(b), Article 55.02.
631	631	(d) If the court finds that the petitioner is entitled to
632	632	expunction of the records and files that are the subject of the
633	633	petition, the court shall enter an order directing expunction in a
634	634	manner consistent with the procedures described by Section 1a,
635	635	Article 55.02.
636	636	(e) Notwithstanding any other law, the law enforcement
637	637	agency, the prosecuting attorney responsible for investigating the
638	638	offense, and the clerk of the applicable court may retain the
639	639	records and files relating to the arrest for the offense, including
640	640	any records and files related to a conviction of the offense, to be
641	641	used only:
642	642	(1) for the investigation or prosecution of another
643	643	offense arising out of the same transaction for which the person was
644	644	arrested; or
645	645	(2) by the office of the governor in determining
646	646	whether to issue a pardon or commute a sentence.
647	647	(f) The records and files for which an order of expunction
648	648	has been issued under this article are not open for inspection by
649	649	anyone, except that the records and files are open for inspection by
650	650	the person who is the subject of the order or for the purposes
651	651	described by Subsection (e).
652	652	ARTICLE 4. CONFORMING CHANGES
653	653	SECTION 4.01. Section 122.103(c), Agriculture Code, is
654	654	amended to read as follows:
655	655	(c) A qualified applicant who along with the application
656	656	submits proof to the department that the applicant holds a license
657	657	under Chapter 487 or 491, Health and Safety Code, is not required to
658	658	pay an application fee, and the department shall issue the license
659	659	to the applicant within the time prescribed by Subsection (b).
660	660	SECTION 4.02. Section 109.005(a), Business & Commerce Code,
661	661	is amended to read as follows:
662	662	(a) A business entity may not publish any criminal record
663	663	information in the business entity's possession with respect to
664	664	which the business entity has knowledge or has received notice
665	665	that:
666	666	(1) an order of expunction has been issued under
667	667	Chapter 55 [Article 55.02], Code of Criminal Procedure; or
668	668	(2) an order of nondisclosure of criminal history
669	669	record information has been issued under Subchapter E-1, Chapter
670	670	411, Government Code.
671	671	SECTION 4.03. Article 55.011(b), Code of Criminal
672	672	Procedure, is amended to read as follows:
673	673	(b) A close relative of a deceased person who, if not
674	674	deceased, would be entitled to expunction of records and files
675	675	under this chapter [Article 55.01] may file on behalf of the
676	676	deceased person an ex parte petition for expunction under Section 2
677	677	or 2a, Article 55.02, or Article 55.012, as applicable. If the
678	678	court finds that the deceased person would be entitled to
679	679	expunction of any record or file that is the subject of the
680	680	petition, the court shall enter an order directing expunction.
681	681	SECTION 4.04. Article 102.006(b), Code of Criminal
682	682	Procedure, is amended to read as follows:
683	683	(b) The fees under Subsection (a) or the fee under
684	684	Subsection (a-1), as applicable, shall be waived if:
685	685	(1) the petitioner seeks expunction of a criminal
686	686	record that relates to an arrest for an offense of which the person
687	687	was acquitted, other than an acquittal for an offense described by
688	688	Article 55.01(c), and the petition for expunction is filed not
689	689	later than the 30th day after the date of the acquittal; or
690	690	(2) the petitioner is entitled to expunction under
691	691	Article 55.012.
692	692	SECTION 4.05. Section 411.0835, Government Code, is amended
693	693	to read as follows:
694	694	Sec. 411.0835. PROHIBITION AGAINST DISSEMINATION TO
695	695	CERTAIN PRIVATE ENTITIES. If the department receives information
696	696	indicating that a private entity that purchases criminal history
697	697	record information from the department has been found by a court to
698	698	have committed three or more violations of Section 552.1425 by
699	699	compiling or disseminating information with respect to which an
700	700	order of expunction has been issued under Chapter 55 [Article
701	701	55.02], Code of Criminal Procedure, or an order of nondisclosure of
702	702	criminal history record information has been issued under
703	703	Subchapter E-1, the department may not release any criminal history
704	704	record information to that entity until the first anniversary of
705	705	the date of the most recent violation.
706	706	SECTION 4.06. Section 411.0851(a), Government Code, is
707	707	amended to read as follows:
708	708	(a) A private entity that compiles and disseminates for
709	709	compensation criminal history record information shall destroy and
710	710	may not disseminate any information in the possession of the entity
711	711	with respect to which the entity has received notice that:
712	712	(1) an order of expunction has been issued under
713	713	Chapter 55 [Article 55.02], Code of Criminal Procedure; or
714	714	(2) an order of nondisclosure of criminal history
715	715	record information has been issued under Subchapter E-1.
716	716	SECTION 4.07. Section 411.0891(a), Government Code, is
717	717	amended to read as follows:
718	718	(a) Subject to Section 411.087, the department is
719	719	authorized to obtain and use criminal history record information
720	720	maintained by the Federal Bureau of Investigation or the department
721	721	that relates to a person who:
722	722	(1) is an applicant for or holds a registration issued
723	723	by the director under Subchapter C, Chapter 481, Health and Safety
724	724	Code, that authorizes the person to manufacture, distribute,
725	725	analyze, or conduct research with a controlled substance;
726	726	(2) is an applicant for or holds a registration issued
727	727	by the department under Chapter 487, Health and Safety Code, to be a
728	728	director, manager, or employee of a dispensing organization, as
729	729	defined by Section 487.001, Health and Safety Code;
730	730	(2-a) is an applicant for or holds a license issued
731	731	under Chapter 491, Health and Safety Code, to be a cannabis grower,
732	732	cannabis establishment, cannabis secure transporter, or cannabis
733	733	testing facility, as defined by Section 491.0001, Health and Safety
734	734	Code;
735	735	(3) is an applicant for or holds an authorization
736	736	issued by the department under Section 521.2476, Transportation
737	737	Code, to do business in this state as a vendor of ignition interlock
738	738	devices;
739	739	(4) is an applicant for or holds certification by the
740	740	department as an inspection station or an inspector under
741	741	Subchapter G, Chapter 548, Transportation Code, holds an inspection
742	742	station or inspector certificate issued under that subchapter, or
743	743	is the owner of an inspection station operating under that chapter;
744	744	or
745	745	(5) is an applicant for or holds a certificate of
746	746	registration issued by the department under Chapter 1956,
747	747	Occupations Code, to act as a metal recycling entity.
748	748	SECTION 4.08. Section 411.151(b), Government Code, is
749	749	amended to read as follows:
750	750	(b) A person may petition for the expunction of a DNA record
751	751	under the procedures established under Article 55.02, Code of
752	752	Criminal Procedure, if the person is entitled to the expunction of
753	753	records relating to the offense to which the DNA record is related
754	754	under Chapter 55 [Article 55.01], Code of Criminal Procedure.
755	755	SECTION 4.09. Section 552.1425(a), Government Code, is
756	756	amended to read as follows:
757	757	(a) A private entity that compiles and disseminates for
758	758	compensation criminal history record information may not compile or
759	759	disseminate information with respect to which the entity has
760	760	received notice that:
761	761	(1) an order of expunction has been issued under
762	762	Chapter 55 [Article 55.02], Code of Criminal Procedure; or
763	763	(2) an order of nondisclosure of criminal history
764	764	record information has been issued under Subchapter E-1, Chapter
765	765	411.
766	766	SECTION 4.10. Section 443.202(a), Health and Safety Code,
767	767	is amended to read as follows:
768	768	(a) This section does not apply to low-THC cannabis
769	769	regulated under Chapter 487 or cannabis regulated under Chapter
770	770	491.
771	771	SECTION 4.11. Section 443.2025(a), Health and Safety Code,
772	772	is amended to read as follows:
773	773	(a) This section does not apply to low-THC cannabis
774	774	regulated under Chapter 487 or cannabis regulated under Chapter
775	775	491.
776	776	SECTION 4.12. Section 481.062, Health and Safety Code, is
777	777	amended to read as follows:
778	778	Sec. 481.062. EXEMPTIONS. (a) The following persons are
779	779	not required to register and may possess a controlled substance
780	780	under this chapter [without registering with the Federal Drug
781	781	Enforcement Administration]:
782	782	(1) an agent or employee of a registered manufacturer,
783	783	distributor, analyzer, or dispenser of the controlled substance
784	784	[who is registered with the Federal Drug Enforcement Administration
785	785	and] acting in the usual course of business or employment;
786	786	(2) a common or contract carrier, a warehouseman, or
787	787	an employee of a carrier or warehouseman whose possession of the
788	788	controlled substance is in the usual course of business or
789	789	employment;
790	790	(3) an ultimate user or a person in possession of the
791	791	controlled substance under a lawful order of a practitioner or in
792	792	lawful possession of the controlled substance if it is listed in
793	793	Schedule V;
794	794	(4) an officer or employee of this state, another
795	795	state, a political subdivision of this state or another state, or
796	796	the United States who is lawfully engaged in the enforcement of a
797	797	law relating to a controlled substance or drug or to a customs law
798	798	and authorized to possess the controlled substance in the discharge
799	799	of the person's official duties;
800	800	(5) if the substance is tetrahydrocannabinol or one of
801	801	its derivatives:
802	802	(A) a Department of State Health Services
803	803	official, a medical school researcher, or a research program
804	804	participant possessing the substance as authorized under
805	805	Subchapter G; or
806	806	(B) a practitioner or an ultimate user possessing
807	807	the substance as a participant in a federally approved therapeutic
808	808	research program that the commissioner has reviewed and found, in
809	809	writing, to contain a medically responsible research protocol; [or]
810	810	(6) a dispensing organization licensed under Chapter
811	811	487 that possesses low-THC cannabis;
812	812	(7) a cannabis grower, cannabis establishment,
813	813	cannabis secure transporter, or cannabis testing facility licensed
814	814	under Chapter 491 that possesses cannabis or cannabis products; or
815	815	(8) a person who possesses cannabis or cannabis
816	816	products in accordance with Chapter 491.
817	817	(b) In this section, "cannabis" and "cannabis product" have
818	818	the meanings assigned to those terms by Section 491.0001.
819	819	SECTION 4.13. Section 481.111, Health and Safety Code, is
820	820	amended by adding Subsections (g) and (h) to read as follows:
821	821	(g) Sections 481.113, 481.116, 481.120, 481.121, and
822	822	481.125 do not apply to a person who engages in the acquisition,
823	823	possession, production, processing, cultivation, delivery,
824	824	transportation, disposal, transfer, or use of a raw material used
825	825	in or by-product created by the production or cultivation of
826	826	cannabis or cannabis products if the conduct is expressly
827	827	authorized by Subchapter B, Chapter 491.
828	828	(h) For purposes of Subsection (g), "cannabis" and
829	829	"cannabis product" have the meanings assigned to those terms by
830	830	Section 491.0001.
831	831	SECTION 4.14. Section 551.004, Occupations Code, is amended
832	832	by amending Subsection (a) and adding Subsection (a-1) to read as
833	833	follows:
834	834	(a) This subtitle does not apply to:
835	835	(1) a practitioner licensed by the appropriate state
836	836	board who supplies a patient of the practitioner with a drug in a
837	837	manner authorized by state or federal law and who does not operate a
838	838	pharmacy for the retailing of prescription drugs;
839	839	(2) a member of the faculty of a college of pharmacy
840	840	recognized by the board who is a pharmacist and who performs the
841	841	pharmacist's services only for the benefit of the college;
842	842	(3) a person who procures prescription drugs for
843	843	lawful research, teaching, or testing and not for resale;
844	844	(4) a home and community support services agency that
845	845	possesses a dangerous drug as authorized by Section 142.0061,
846	846	142.0062, or 142.0063, Health and Safety Code; [or]
847	847	(5) a dispensing organization[, as defined by Section
848	848	487.001, Health and Safety Code,] that cultivates, processes, and
849	849	dispenses low-THC cannabis, as authorized by Chapter 487, Health
850	850	and Safety Code, to a patient listed in the compassionate-use
851	851	registry established under that chapter;
852	852	(6) a cannabis grower, cannabis establishment,
853	853	cannabis secure transporter, or cannabis testing facility licensed
854	854	under Chapter 491, Health and Safety Code, that cultivates,
855	855	manufactures, processes, distributes, delivers sells, tests,
856	856	transports, or dispenses cannabis or a cannabis product as
857	857	authorized by that chapter; or
858	858	(7) a person who transfers cannabis without
859	859	remuneration as authorized by Section 491.0051, Health and Safety
860	860	Code.
861	861	(a-1) For purposes of this section:
862	862	(1) "Cannabis," "cannabis establishment," "cannabis
863	863	grower," "cannabis product," "cannabis secure transporter," and
864	864	"cannabis testing facility" have the meanings assigned by Section
865	865	491.0001, Health and Safety Code.
866	866	(2) "Dispensing organization" and "low-THC cannabis"
867	867	have the meanings assigned by Section 487.001, Health and Safety
868	868	Code.
869	869	SECTION 4.15. Section 151.313(c), Tax Code, is amended to
870	870	read as follows:
871	871	(c) A product is a drug or medicine for purposes of this
872	872	section if the product:
873	873	(1) is intended for use in the diagnosis, cure,
874	874	mitigation, treatment, or prevention of disease, illness, injury,
875	875	or pain;
876	876	(2) is applied to the human body or is a product that a
877	877	human ingests or inhales;
878	878	(3) is not an appliance or device; [and]
879	879	(4) is not food; and
880	880	(5) is not cannabis or a cannabis product, as those
881	881	terms are defined by Section 491.0001, Health and Safety Code.
882	882	SECTION 4.16. Section 151.314, Tax Code, is amended by
883	883	adding Subsection (i) to read as follows:
884	884	(i) The exemption provided by Subsection (a) does not apply
885	885	to a cannabis product, as defined by Section 491.0001, Health and
886	886	Safety Code.
887	887	SECTION 4.17. Section 151.316, Tax Code, is amended by
888	888	adding Subsection (e) to read as follows:
889	889	(e) The exemption provided by Subsection (a)(5) does not
890	890	apply to cannabis, as defined by Section 491.0001, Health and
891	891	Safety Code.
892	892	ARTICLE 5. TRANSITION; EFFECTIVE DATE
893	893	SECTION 5.01. (a) Not later than July 1, 2024, the Texas
894	894	Commission of Licensing and Regulation shall adopt rules as
895	895	required to implement, administer, and enforce Chapter 491, Health
896	896	and Safety Code, as added by this Act.
897	897	(b) Not later than November 1, 2024, the Texas Department of
898	898	Licensing and Regulation shall begin licensing cannabis growers,
899	899	cannabis establishments, cannabis secure transporters, and
900	900	cannabis testing facilities in accordance with Chapter 491, Health
901	901	and Safety Code, as added by this Act, provided that the applicants
902	902	for a license have met all requirements for approval under Chapter
903	903	491, Health and Safety Code, as added by this Act.
904	904	SECTION 5.02. The changes in law made by this Act do not
905	905	affect tax liability accruing before the effective date of this
906	906	Act. That liability continues in effect as if this Act had not been
907	907	enacted, and the former law is continued in effect for the
908	908	collection of taxes due and for civil and criminal enforcement of
909	909	the liability for those taxes.
910	910	SECTION 5.03. Article 55.012, Code of Criminal Procedure,
911	911	as added by this Act, applies to an expunction of arrest records and
912	912	files relating to an offense that was committed before the
913	913	effective date of this Act.
914	914	SECTION 5.04. This Act takes effect September 1, 2023.