Before you grow, you oughta know.  Researching the web of Federal, State, County, and City laws can keep you out of trouble.

Tips from a cannabis compliance attorney on how to protect yourself as a medical cannabis cultivator in California

What is the law?

• Prop 215 – The Compassionate Use Act of 1996
  • This gave patients the right to use medical cannabis in California with the recommendation of a licensed physician.
• SB 420 – The Medical Marijuana Program Act
  • Clarified protections including allowing patients to collectively/cooperatively cultivate medical cannabis.
  • Created the state issued Medical Marijuana Program Act identification cards
• Attorney General Guidelines for the Security and Non-Diversion of Marijuana Grown for Medical Use (August 2008)
  • Clarified how collectives and cooperatives are suppose to operate including establishing the not-for-profit model, allowing aggregate possession and transport for a collective or cooperative, and giving best-practices.
• Medical Marijuana Regulation and Safety Act of 2015 (AB 266, AB 243, SB 643)
  • Promised to create a dual licensing system with comprehensive regulations for the various segments of the industry including cultivation, manufacturing, testing, dispensing, distributing, and transporting.

IMPORTANT THINGS TO KNOW

• The Medical Marijuana Regulation and Safety Act of 2015 (MMRSA)
  • Created a DUAL licensing structure
    • This means you MUST have your local permit/license/authorization in order to qualify for a state license.
    • State licenses do NOT replace local rules.
• Nothing has actually changed yet.
  • MMRSA promises us a new system that allows commercial cultivation and a regulated system, but this system will not be ready until 2018.
  • Until then we are still ruled by the collective/cooperative non-profit model.
•  MMRSA scared a lot of counties/cities.
  • There was a March 1, 2016 deadline that required cities/counties to regulate cultivation of medical cannabis or lose the right to regulate.
  • This inspire a slew of bans across the state.
  • Gov. Jerry Brown lifted the March 1, 2016 deadline with AB 21.
  • Those bans are still in place, and those counties/cities that didn't ban often have new interim ordinances or proposed ordinances.

So what's my first step?

• If you want to start your very own medical cannabis collective/cooperative there is an incorporation process that you need to go through.
• Because California requires that you be not-for-profit until MMRSA rules take effect in 2018 you have to incorporate as a:
  • Non-profit Corporation
  • Other type of corporation with clauses in your bylaws/articles of incorporation that establish that you will operate not-for-profit.
• You will also need to obtain your Board of Equalization Seller's Permit and Employer Identification Number if you want to vend any of your medicine/be a business.
• Going to a paralegal or an individual who offers such services for the medical cannabis industry is an excellent way to do this.

So what should I do?

• Know the law for your local jurisdiction (i.e. city, county, city/county)
  • Municipal Code
  • Not Yet Codified Ordinances
  • Interim Ordinances
  • Proposed Ordinances
• BE CAREFUL
  • Some counties and cities use a “permissive zoning” structure that means any land use that is not explicitly permitted is considered prohibited.

What is my jurisdiction?

• If you live in California you live in a city, a county, or a city/county.
  • This may seem confusing because your city is located in a county. BUT you only live in a county for the purpose of determining what law applies to you if you live in the unincorporated part of a county.
• This information is generally available online.
  • Google searches for “Do I live in the city of _____ or the county of _____?” often come back with resources to determine where you live.
  • You may have to enter your address on a city or county site to determine this.

But I heard ….

• It is also important to note that what is on the books in a city or county is not always what is practiced.
• Law enforcement in a particular area may or may not be prioritizing enforcing a ban.
  • This does NOT change the fact that there is a ban!
• The Medical Cannabis Industry had to stay in the shadows for a long time, so many practitioners continue to do so.
  • But we don't have to anymore!
• And remember, MMRSA is still being worked on and is scheduled to begin effecting operation in 2018, but they could get it done faster than that.
  • This means that the rules that apply right now, and possibly next year in 2017, are going to change in 2018.

A ban? Are they even allowed to do that?

• Unfortunately yes.
• The Supreme Court of California ruled in City of Riverside v. Inland Empire Patients Health and Wellness Center, Inc., et al. (2013) that cities and counties that prohibit medical cannabis dispensaries and cultivation are not preempted by state law.
  • “We thus conclude that neither the CUA nor the MMP expressly or impliedly preempts the authority of California cities and counties, under their traditional land use and police powers, to allow, restrict, limit, or entirely exclude facilities that distribute medical marijuana, and enforce such policies by nuisance ordinances.”

There is good news though!

• The California Supreme Court said nothing prevents future efforts by the Legislature, or by the People, to adopt a different approach.
• The California Court of Appeals for the Fifth District held in Kirby v. County of Fresno (2015) held that counties and cities cannot criminalize medical cannabis cultivation through local ordinance, as this IS preempted.
  • HOWEVER, they can say that to do so is a public nuisance.
  • And not abating a public nuisance can be deemed a misdemeanor.

Ok. So my city hasn't banned it. What next?

• Now that you know the rules, you should follow them.
• This may be as simple as following operating procedures or as involved as obtaining a permit/license.
  • Small scale personal growth often entails simply following plant number or square footage limitations, wattage limitations, posting rules, etc.
• Whether there's a formal procedure for obtaining a license or not the next step is …

Location Location Location

• Because cities and counties use their land use/zoning code to control medical  cannabis cultivation you need to look at where you are allowed to cultivate.
  • Permitted zones
  • Distance from sensitive uses (ex. schools, other dispensaries, bus stops, etc.)
  • Requirements on types of properties used.
• GENERAL
  • State law requires that you be AT LEAST 600 feet from a school
  • You are going to need permission from the landlord/owner to cultivate

How do I figure out zones?

• Zoning maps and city and county Geographic Information System (GIS) programs are very helpful.
• You can Google these types of maps or call your local zoning/planning department.
  • Only trust Google results that come from an official city or county website.
• Or ask your attorney to check this for you.

How do I check sensitive use distances?

• Here, Google is often your friend.
• You can use Google Maps to check where a school is, and then go back to the county or city GIS program or zoning map and determine how far your proposed location is from that school or other sensitive use.
  • Many GIS programs have a measuring tool, though not all.
• Google walk directions are a good approximation of distance.

So I found a spot.

• Assuming you have found your location which is:
  • Properly zoned
  • Far enough from sensitive uses (ex. Schools, dispensaries, etc.)
  • Either
    • You own it or can buy it
    • You can rent it and get permission from the landlord to cultivate
  • Is able to be outfitted with required characteristics (security, sight blocks, etc.)
• NOW you begin your process of getting your permit/license/authorization from the city or county.

What is a permit/license/authorization?

• Different cities and counties do this differently you may get:
  • A physical license for your cultivation
  • A conditional use permit allowing for your cultivation
  • An informal go-ahead from the city
• The process also varies. It could require:
  • Paperwork
  • Public hearings
  • Postings
  • Compliance with operating procedures
  • Any combination thereof

Why do I need authorization?

• Most importantly, to STAY OUT OF TROUBLE.
  • Getting authorization from your city/county means you are obeying the law as it currently exists.
  • And having your local authorization sets you up for later state licensing under MMRSA.
• MMRSA allows those cultivations that can show “to the satisfaction of the licensing authority” that they were operating in compliance with local law before January 1st, 2018 to continue cultivation during the state license application process.
  • Otherwise, all cultivation is going to have to stop.

How much is a permit/license/authorization going to cost?

• Good question.
• Different cities and counties charge different amounts for:
  • Application fees
  • Administrative costs
  • Renewal fees
  • Etc.
• From a couple hundred to thousands of dollars, fee schedules are something to consider.
  • This can be difficult because not all cities and counties have this information readily available, and some don't even know the answer themselves!

So what do I do?

• This process can be a confusing one, so don't go alone!
• Finding a consultation company and/or an attorney can help you through this process with much less stress.
  • A lawyer will be able to tell you what you have to do (i.e. what law applies to you, what you have to do to comply with the law, etc.)
  • A consultant will be able to get you in compliance (i.e. tell you what security company to hire, direct you to an inventory control software program, etc.)
• Many individuals hire both a consultant AND a lawyer so that they have somebody looking our for their legal interests throughout the process.

Who is Tully & Weiss?

• Tully & Weiss, Attorneys at Law is a firm dedicated primarily to criminal defense.
• Joseph M. Tully is a trial attorney who cares about medical cannabis.
  • A 100% win rate for medical cannabis cases.
  • Top 100 Trial Attorneys in the Nation for 2013, 2014, and 2015.
  • Joseph will make sure that your process can provide the best defense if you do end up with charges filed against you.
• Ashley Bargenquast is the firm's compliance associate attorney.
  • It is her job to keep you from needing Joseph's services.
  • She has been an active advocate for medical cannabis and has been working on applications throughout the country since 2013.