Commercial Medical Cannabis Regulations in CA Medical Marijuana Regulation and Safety Act (MMRSA)

Three separate bills comprise the Medical Marijuana Regulation and Safety Act (MMRSA) – AB 243, AB 266, and SB 643. Each deals with different aspects of licensing and regulating commercial medical cannabis cultivation, manufacturing, distribution, transportation, sales, and testing. This is a brief summary of the bills, based on the digest prepared by the Legislative Counsel’s office.

You may also want to review a summary of this legislation prepared by Dale Gieringer, Ph.D., from CA NORML.

Download a 43-page analysis of the MMRSA prepared by Los Angeles attorney and medical cannabis specialist Steve Lubell here. 

Be sure to check out the dates and deadlines in the MMRSA at the bottom of this page and additional resources in our Local Access Project section.

Nothing on this page should be construed as legal, financial, or licensing advice.  This information is provided for educational purposes only. ASA strongly recommends that any applicant or potential applicant for a medical cannabis license seek legal advice regarding your rights and responsibilities under the MMRSA and other local, state, and federal laws.  

AB 243 (Wood)

This bill would require the Department of Food and Agriculture, the Department of Pesticide Regulation, the State Department of Public Health, the Department of Fish and Wildlife, and the State Water Resources Control Board to promulgate regulations or standards relating to medical marijuana and its cultivation, as specified. The bill would also require various state agencies to take specified actions to mitigate the impact that marijuana cultivation has on the environment. By requiring cities, counties, and their local law enforcement agencies to coordinate with state agencies to enforce laws addressing the environmental impacts of medical marijuana cultivation, and by including medical marijuana within the Sherman Act, the bill would impose a state-mandated local program.

This bill would require a state licensing authority to charge each licensee under the act a licensure and renewal fee, as applicable, and would further require the deposit of those collected fees into an account specific to that licensing authority in the Medical Marijuana Regulation and Safety Act Fund, which this bill would establish. This bill would impose certain fines and civil penalties for specified violations of the Medical Marijuana Regulation and Safety Act, and would require moneys collected as a result of these fines and civil penalties to be deposited into the Medical Cannabis Fines and Penalties Account, which this bill would establish within the fund. Moneys in the fund and each account of the fund would be available upon appropriation of the Legislature.

This bill would authorize the Director of Finance to provide an initial operating loan from the General Fund to the Medical Marijuana Regulation and Safety Act Fund of up to $10,000,000, and would appropriate $10,000,000 from the Medical Marijuana Regulation and Safety Act Fund to the Department of Consumer Affairs to begin the activities of the bureau.

AB 266 (Bonta)

This bill, among other things, would enact the Medical Marijuana Regulation and Safety Act for the licensure and regulation of medical marijuana and would establish within the Department of Consumer Affairs the Bureau of Medical Marijuana Regulation, under the supervision and control of the Director of Consumer Affairs. The bill would require the director to administer and enforce the provisions of the act.

This bill would also require the Board of Equalization, in consultation with the Department of Food and Agriculture, to adopt a system for reporting the movement of commercial cannabis and cannabis products.

This bill would impose certain fines and civil penalties for specified violations of the act, and would require moneys collected as a result of these fines and civil penalties to be deposited into the Medical Cannabis Fines and Penalties Account.

This bill would repeal these provisions upon the issuance of licenses by licensing authorities pursuant to the Medical Marijuana Regulation and Safety Act, as specified, and would instead provide that actions of licensees with the relevant local permits, in accordance with the act and applicable local ordinances, are not offenses subject to arrest, prosecution, or other sanction under state law.

SB 643 (McGuire)

This bill would, among other things, set forth standards for a physician and surgeon prescribing medical cannabis and require the Medical Board of California to prioritize its investigative and prosecutorial resources to identify and discipline physicians and surgeons that have repeatedly recommended excessive cannabis to patients for medical purposes or repeatedly recommended cannabis to patients for medical purposes without a good faith examination, as specified. The bill would require the Bureau of Medical Marijuana to require an applicant to furnish a full set of fingerprints for the purposes of conducting criminal history record checks. The bill would prohibit a physician and surgeon who recommends cannabis to a patient for a medical purpose from accepting, soliciting, or offering any form of remuneration from a facility licensed under the Medical Marijuana Regulation and Safety Act. The bill would make a violation of this prohibition a misdemeanor, and by creating a new crime, this bill would impose a state-mandated local program.

This bill would require the Governor, under the Medical Marijuana Regulation and Safety Act, to appoint, subject to confirmation by the Senate, a chief of the Bureau of Medical Marijuana Regulation. The act would require the Department of Consumer Affairs to have the sole authority to create, issue, renew, discipline, suspend, or revoke licenses for the transportation and storage, unrelated to manufacturing, of medical marijuana, and would authorize the department to collect fees for its regulatory activities and impose specified duties on this department in this regard.

The act would require the Department of Food and Agriculture to administer the provisions of the act related to, and associated with, the cultivation, and transportation of, medical cannabis and would impose specified duties on this department in this regard. The act would require the State Department of Public Health to administer the provisions of the act related to, and associated with, the manufacturing and testing of medical cannabis and would impose specified duties on this department in this regard.

This bill would authorize counties to impose a tax upon specified cannabis-related activity.

This bill would require an applicant for a state license pursuant to the act to provide a statement signed by the applicant under penalty of perjury, thereby changing the scope of a crime and imposing a state-mandated local program.

This bill would set forth standards for the licensed cultivation of medical cannabis, including, but not limited to, establishing duties relating to the environmental impact of cannabis and cannabis products. The bill would also establish state cultivator license types, as specified.

Dates & Deadlines in the MMRSA

July 1, 2015 – Date by which those claiming vertical integration had to be operating a vertically integrated business. (AB 266 Section 19328 (c1))

January 1, 2016 – date on which AB 266, AB 243 and SB 643 will take effect. (See: the end of the legislative summaries in all three bills)

January 1, 2016 – Beginning business operating date for cannabis businesses who are eligible for priority licensing. “In issuing licenses, the licensing authority shall prioritize any facility or entity that can demonstrate to the authority’s satisfaction that it was in operation and in good standing with the local jurisdiction by January 1, 2016.” (AB 266 Section 19321 (c))

March 1, 2016 – Date by which cultivation must be regulated by a locality: “If a city, county, or city and county does not have land use regulations or ordinances regulating or prohibiting the cultivation of marijuana, either expressly or otherwise under principles of permissive zoning, or chooses not to administer a conditional permit program pursuant to this section, then commencing March 1, 2016, the division shall be the sole licensing authority for medical marijuana cultivation applicants in that city, county, or city and county.” (AB 243 Section 19362.777 (c)(4))

January 1, 2017 - By January 1, 2017, the Division of Occupational Safety and Health shall convene an advisory committee to evaluate whether there is a need to develop industry-specific regulations related to the activities of facilities issued a licensee. (AB 266 Labor Code Amendment Sec. 7 147.5)

July 1, 2017 - By July 1, 2017, the advisory committee shall present to the board its findings and recommendations for consideration by the board. (AB 266 Labor Code Amendment Sec. 7 147.5)

July 1, 2017 - By July 1, 2017, the board shall render a decision regarding the adoption of industry-specific regulations pursuant to this section. (AB 266 Labor Code Amendment Sec. 7 147.5)

January 1, 2018 – “a facility or entity that is operating in compliance with local zoning ordinances and other state and local requirements on or before January 1, 2018, may continue its operations until its application for licensure is approved or denied pursuant to this chapter.” (AB 266 Section 19321 (c))

January 1, 2020 - Not later than January 1, 2020, the Department of Food and Agriculture in conjunction with the Bureau, shall make available a certified organic designation and organic certification program for medical marijuana, if permitted under federal law and the National Organic Program. (SB 643 Section 19332.5(a))

January 1, 2022 - Date by which the loan of up to $10,000,000. 00 from the general fund to establish the Medical Marijuana Regulation and Safety Act has to be repaid. If the fees collected by that time don’t repay the loan, they will begin using funds that come from imposing penalties to repay the loan. (AB 243 Section 19351 (b) (1))

March 1, 2023 - Beginning on March 1, 2023, and on or before March 1 of each following year, each licensing authority shall prepare and submit to the Legislature an annual report on the authority’s activities and post the report on the authority’s Internet Web Site. (AB 266 Section 19353)

January 1, 2026 – The date Type 10A Paragraph on licensing become inoperative “A Type 10A licensee may apply for a Type 6 or 7 state license and hold a 1, 1A, 1B, 2, 2A, 2B, 3, 3A, 3B, 4 or combination thereof if, under the 1, 1A, 1B, 2, 2A, 2B, 3, 3A, 3B, 4 or combination of licenses thereof, no more than four acres of total canopy size of cultivation by the licensee is occurring throughout the state during the period that the respective licenses are valid… This paragraph shall become inoperative on January 1, 2026.” ((AB 266 Section 19328 (a) (9))

January 1, 2026 – Date vertical integration section of AB 266 is repealed. (AB 266 Section 19328 (d))