Marijuana Sales Tax Revenues (10/01/2014)

Final
STAFF SUMMARY OF MEETING

MARIJUANA SALES TAX REVENUES

Date:	10/01/2014	ATTENDANCE

Time:	09:40 AM to 12:36 PM	Adams	E
		Aguilar	X
Place:	HCR 0112	Anderle	X
		Baumgardner	X
This Meeting was called to order by		Blake	X
	Representative Pabon	Bommer	E
		Connors	X
This Report was prepared by		Dore	X
	Matt Kiszka	Federspiel	X
		Freedman	X
		Martinez	E
		Massey	X
		McGowan	X
		Pace	X
		Raynes	E
		Schut	X
		Sills	X
		Singer	X
		Vasquez	E
		Jahn	X
		Pabon	X

		X = Present, E = Excused, A = Absent, * = Present after roll call

Bills Addressed:		Action Taken:
Discussion of Bills Public Comment Vote on Bills		Witness Testimony and/or Committee Discussion Only Witness Testimony and/or Committee Discussion Only Bill 1 and Bill 2 referred to Legislative Council

09:40 AM -- Discussion of Bills

Representative Pabon, Chair, called the meeting to order. He discussed the bill drafts that had been distributed to the committee, and Commissioner Pace came to the table to present Bill 1, which addresses medical marijuana (Attachment A). Commissioner Pace discussed the genesis of the bill, which had been discussed at the previous meeting of the committee. He spoke to amendments he was going to be proposing for the bill. Commissioner Pace also discussed the key elements of the bill, which are the appointment of a special prosecutor within the Attorney General's Office to address medical marijuana offenses, increased regulation of caregivers, and the testing of marijuana cultivated by caregivers. Andrew Freedman, State Director of Marijuana Coordination, came to the table to speak further to the drafting of the bill and discussed the perspective of the Governor's Office on the changes that need to be made in how medical marijuana is regulated.

14Marijuana1001AttachA.pdf

09:55 AM

Commissioner Pace discussed Amendment 2 (Attachment B), which would strike a provision of the bill that eliminates transfers of medical marijuana inventory to a retail operation. He responded to a question on the original intent of this transfer banning provision. He then explained Amendment 5 (Attachment C), which would replace a section of the bill to allow the state health agency to provide primary caregiver information electronically to the state licensing authority and the Department of Public Safety for entry into the Colorado Crime Information Center (CCIC). The committee discussed the charge and scope of the committee in light of Bill 1 and the substantive changes it would make to state law concerning medical marijuana. Commissioner Pace and Mr. Freedman responded to questions about the new felony offenses created in the bill for caregivers who do not register and the appointment of a special prosecutor for medical marijuana by the Attorney General's office under the bill. The committee discussed the process and intent behind having a committee drafted bill.

14Marijuana1001AttachB.pdf

14Marijuana1001AttachC.pdf

10:09 AM

The committee discussed what would happen if a physician or pharmacist were practicing without proper licensure or illegally distributing drugs and if the penalties for such conduct would be similar to those laid out in the bill for caregivers who fail to register. It also conferred on medical and recreational marijuana testing, the importance of having Bill 1 approved by the committee and put forth to the legislature to be considered upon its merits, and the penalties for illegal cultivation of marijuana and operating as a caregiver without registering. Representative Pabon discussed the merits of the bill and how it is a beginning of the discussion on how to improve the regulation of medical and recreational marijuana in Colorado.

10:25 AM

Bill 2 was distributed to the committee (Attachment D), and Commissioner Pace described how the bill allows local governments to implement sales and excise taxes on retail marijuana. Gini Pingenot, representing Colorado Counties, Inc. (CCI), came to the table and stated that the bill is a legislative priority for CCI. Amendment 1 to Bill 2 (Attachment E) was distributed to the committee, which removed the statutory caps on local sales and excise taxes on recreational marijuana that were included in the original bill draft. The committee discussed the merits of the bill.

14Marijuana1001AttachD.pdf

14Marijuana1001AttachE.pdf

10:34 AM

The committee took a brief recess.

10:45 AM

The committee came back to order. Bill 3 was distributed to the committee (Attachment F). Senator Jahn discussed the high cost of substance use disorder services that had been brought to light during the meetings of the committee. She spoke to how difficult it is for an individual with a substance dependence to obtain treatment and work towards sobriety. She stated that the legislature needs to provide funding for organizations that can treat such individuals. She told the committee that she was working on legislation to address this, drafted as Bill 3, but that she was not ready to take it out of the committee yet. Senator Jahn stated that ultimately we are dealing with mental health issues when it comes to addiction and substance abuse, and that the state needs a way of dealing with this. The committee discussed funding for mental health providers and substance use services providers in the state, how the Department of Human Services can assist with such services, and declared its support for funding these types of programs.

14Marijuana1001AttachF.pdf

10:58 AM -- Public Comment

David Broadwell, representing the City and County of Denver, came to the table to discuss Bill 1. He spoke about recent court decisions concerning civil liability for the seizure, destruction, and failure to return medical and retail marijuana plant by law enforcement in Colorado; provided clarification within the bill on where caregiver information is stored and how it can be accessed; spoke about the differences in confidentiality for medical marijuana patients versus caregivers; and discussed the regulation of medical marijuana cultivation by primary caregivers. Commissioner Pace responded to Mr. Broadwell's comments.

11:08 AM

Samantha Walsh, representing the Cannabis Consumers Coalition, came to the table to provide testimony. She stated that there was a dearth of representation for caregivers and medical marijuana patients on the committee and that she was speaking on their behalf. Ms. Walsh said that caregivers cannot currently test marijuana products through licensed testing facilities. She added that they are operating under a framework in which they cannot derive profit for providing medical marijuana, so they cannot fund testing, and suggested that the legislature could appropriate funds towards caregivers to refund the costs of marijuana testing. She also spoke to the lack of criminal defense options for caregivers under the strict liability felonies laid out in the bill. She asked for the bill to be tabled so that caregivers could be brought into the discussion to voice their concerns with the potential legislation.

11:12 AM -- Vote on Bills

The committee went into a brief recess.

11:39 AM

The committee came back to order. A number of amendments were distributed to the committee: Amendment 2 (Attachment B), Amendment 5 (Attachment C), Amendment 6 (Attachment G), Amendment 9 (Attachment H), Amendment 10 (Attachment I), Amendment 11 (Attachment J), and Amendment 12 (Attachment K).

14Marijuana1001AttachB.pdf

14Marijuana1001AttachC.pdf

14Marijuana1001AttachG.pdf

14Marijuana1001AttachH.pdf

14Marijuana1001AttachI.pdf

14Marijuana1001AttachJ.pdf

14Marijuana1001AttachK.pdf

Commissioner Pace explained Amendment 2, which strikes language prohibiting the transfer of medical marijuana inventory to a retail operation. Commissioner Pace explained Amendment 5, which he said incorporates the Department of Public Health and the Environment's (CDPHE) preferred language regarding the CCIC. Ms. Anderle stated that Amendment 5 would need to be adopted to allow CDPHE to transfer caregiver information to the CCIC. Commissioner Pace explained Amendment #6, which makes the bill title more specific.

11:45 AM

Senator Aguilar introduced Amendment 9, as well as a redraft of Bill 1 with the amendment incorporated (Attachment L). She explained that Amendment 9 achieves the same thing as Amendment 2, removes the provisions concerning the criminal enforcement section within the Department of Law, requires the Colorado Medical Board to introduce guidelines for medical marijuana and non-malignant pain, requires the Department of Public Health to promulgate guidelines for primary caregivers surrounding contaminants and THC levels in marijuana that they cultivate, increases caregiver registration deadlines to 30 days from the date of licensing or of being notified of the duty to register, prohibits a person from being a caregiver again if they do not register, ensures that confidential patient information is not released by the state health agency, and strikes the section of Bill 1 that allows the provision of caregiver information to the CCIC. She responded to questions on the Colorado Medical Board creating guidelines for the use of medical marijuana for nonmalignant pain. The committee discussed the changes made by Amendment 9.

14Marijuana1001AttachL.pdf

12:00 PM

Representative Dore presented Amendment 10, and explained that it addresses the amount of marijuana cultivated by caregivers.

12:02 PM

Commissioner Pace presented Amendment 11, and explained that it would allow moneys from the Marijuana Tax Cash Fund to be used to fund the implementation of legislation approved by the Marijuana Revenues Interim Committee.

12:02 PM

Senator Baumgardner explained Amendment 12, which he said would remove provisions of the bill concerning local government land use authority in the regulation of caregivers from Bill 1.


BILL:	Bill 1
TIME:	12:05:38 PM
MOVED:	Aguilar
MOTION:	Adopt Amendment 9, as amended, to Bill 1. The motion passed on a vote of 5-1.
SECONDED:	Singer
		VOTE
	Adams
	Aguilar	Yes
	Anderle
	Baumgardner	Yes
	Blake
	Bommer
	Connors
	Dore	Yes
	Federspiel
	Freedman
	Martinez
	Massey
	McGowan
	Pace
	Raynes
	Schut
	Sills
	Singer	Yes
	Vasquez
	Jahn	Yes
	Pabon	No

YES: 5 NO: 1 EXC: 5 ABS: 0 FINAL ACTION: PASS


BILL:	Bill 1
TIME:	12:10:47 PM
MOVED:	Aguilar
MOTION:	This is a conceptual amendment to Amendment 9 - strike line 29 of page 1 and substitute "TEN" for "THIRTY" in line 30. The motion passed without objection.
SECONDED:	Singer
		VOTE
	Adams
	Aguilar
	Anderle
	Baumgardner
	Blake
	Bommer
	Connors
	Dore
	Federspiel
	Freedman
	Martinez
	Massey
	McGowan
	Pace
	Raynes
	Schut
	Sills
	Singer
	Vasquez
	Jahn
	Pabon

YES: 0 NO: 0 EXC: 5 ABS: 0 FINAL ACTION: Pass Without Objection


BILL:	Bill 1
TIME:	12:06:55 PM
MOVED:	Aguilar
MOTION:	This is a conceptual amendment to Amendment 9 - replace lines 18-20 of page 1 with language that incorporates Medical Practice Act guidelines surrounding severe pain and align terms used for severe pain with the Constitution. The motion passed without objection.
SECONDED:	Baumgardner
		VOTE
	Adams
	Aguilar
	Anderle
	Baumgardner
	Blake
	Bommer
	Connors
	Dore
	Federspiel
	Freedman
	Martinez
	Massey
	McGowan
	Pace
	Raynes
	Schut
	Sills
	Singer
	Vasquez
	Jahn
	Pabon

YES: 0 NO: 0 EXC: 5 ABS: 0 FINAL ACTION: Pass Without Objection

12:13 PM

The committee discussed Amendment 6.


BILL:	Bill 1
TIME:	12:13:10 PM
MOVED:	Singer
MOTION:	Adopt Amendment 6 to Bill 1. The motion passed without objection.
SECONDED:	Aguilar
		VOTE
	Adams
	Aguilar
	Anderle
	Baumgardner
	Blake
	Bommer
	Connors
	Dore
	Federspiel
	Freedman
	Martinez
	Massey
	McGowan
	Pace
	Raynes
	Schut
	Sills
	Singer
	Vasquez
	Jahn
	Pabon

YES: 0 NO: 0 EXC: 5 ABS: 0 FINAL ACTION: Pass Without Objection

12:13 PM

Michael Dohr, Office of Legislative Legal Services, came to the table to speak to Amendment 10 and whether it would create a settled question with Amendment 9. The committee discussed the merits of Amendment 10 and how it would alter the number of plants that a medical marijuana caregiver could grow.


BILL:	Bill 1
TIME:	12:15:07 PM
MOVED:	Dore
MOTION:	Adopt Amendment 10, as amended, to Bill 1. The motion passed without objection.
SECONDED:	Pabon
		VOTE
	Adams
	Aguilar
	Anderle
	Baumgardner
	Blake
	Bommer
	Connors
	Dore
	Federspiel
	Freedman
	Martinez
	Massey
	McGowan
	Pace
	Raynes
	Schut
	Sills
	Singer
	Vasquez
	Jahn
	Pabon

YES: 0 NO: 0 EXC: 5 ABS: 0 FINAL ACTION: Pass Without Objection


BILL:	Bill 1
TIME:	12:22:48 PM
MOVED:	Aguilar
MOTION:	This is a conceptual amendment to Amendment 10 - remove strikeout from text and split paragraph into two sections, inserting "(b)" before language beginning "A PRIMARY CAREGIVER MAY NOT CULTIVATE..." The motion passed without objection.
SECONDED:	Dore
		VOTE
	Adams
	Aguilar
	Anderle
	Baumgardner
	Blake
	Bommer
	Connors
	Dore
	Federspiel
	Freedman
	Martinez
	Massey
	McGowan
	Pace
	Raynes
	Schut
	Sills
	Singer
	Vasquez
	Jahn
	Pabon

YES: 0 NO: 0 EXC: 5 ABS: 0 FINAL ACTION: Pass Without Objection


BILL:	Bill 1
TIME:	12:24:02 PM
MOVED:	Pabon
MOTION:	Adopt Amendment 11, as amended, to Bill 1. The motion passed without objection.
SECONDED:	Aguilar
		VOTE
	Adams
	Aguilar
	Anderle
	Baumgardner
	Blake
	Bommer
	Connors
	Dore
	Federspiel
	Freedman
	Martinez
	Massey
	McGowan
	Pace
	Raynes
	Schut
	Sills
	Singer
	Vasquez
	Jahn
	Pabon

YES: 0 NO: 0 EXC: 5 ABS: 0 FINAL ACTION: Pass Without Objection


BILL:	Bill 1
TIME:	12:24:51 PM
MOVED:	Pabon
MOTION:	This is a conceptual amendment to Amendment 11 - change "Marijuana Cash Fund" to "Marijuana Tax Cash Fund" in line 4. The motion passed without objection.
SECONDED:	Singer
		VOTE
	Adams
	Aguilar
	Anderle
	Baumgardner
	Blake
	Bommer
	Connors
	Dore
	Federspiel
	Freedman
	Martinez
	Massey
	McGowan
	Pace
	Raynes
	Schut
	Sills
	Singer
	Vasquez
	Jahn
	Pabon

YES: 0 NO: 0 EXC: 5 ABS: 0 FINAL ACTION: Pass Without Objection


BILL:	Bill 1
TIME:	12:25:43 PM
MOVED:	Baumgardner
MOTION:	Adopt Amendment 12 to Bill 1. The motion passed without objection.
SECONDED:	Jahn
		VOTE
	Adams
	Aguilar
	Anderle
	Baumgardner
	Blake
	Bommer
	Connors
	Dore
	Federspiel
	Freedman
	Martinez
	Massey
	McGowan
	Pace
	Raynes
	Schut
	Sills
	Singer
	Vasquez
	Jahn
	Pabon

YES: 0 NO: 0 EXC: 5 ABS: 0 FINAL ACTION: Pass Without Objection


BILL:	Bill 1
TIME:	12:26:12 PM
MOVED:	Pabon
MOTION:	Refer Bill 1, as amended, to Legislative Council. The motion passed on a vote of 6-0.
SECONDED:	Singer
		VOTE
	Adams
	Aguilar	Yes
	Anderle
	Baumgardner	Yes
	Blake
	Bommer
	Connors
	Dore	Yes
	Federspiel
	Freedman
	Martinez
	Massey
	McGowan
	Pace
	Raynes
	Schut
	Sills
	Singer	Yes
	Vasquez
	Jahn	Yes
	Pabon	Yes

YES: 6 NO: 0 EXC: 5 ABS: 0 FINAL ACTION: PASS

12:29 PM

Commissioner Pace spoke to Bill 2.


BILL:	Bill 2
TIME:	12:30:38 PM
MOVED:	Pabon
MOTION:	Adopt Amendment 1 to Bill 2. The motion passed without objection.
SECONDED:	Aguilar
		VOTE
	Adams
	Aguilar
	Anderle
	Baumgardner
	Blake
	Bommer
	Connors
	Dore
	Federspiel
	Freedman
	Martinez
	Massey
	McGowan
	Pace
	Raynes
	Schut
	Sills
	Singer
	Vasquez
	Jahn
	Pabon

YES: 0 NO: 0 EXC: 5 ABS: 0 FINAL ACTION: Pass Without Objection

12:30 PM

The committee discussed whether Bill 2 creates any conflict with the voter approved legislation of Proposition AA and the taxation of retail marijuana.


BILL:	Bill 2
TIME:	12:31:02 PM
MOVED:	Singer
MOTION:	Refer Bill 2, as amended, to Legislative Council. The motion passed on a vote of 6-0.
SECONDED:	Pabon
		VOTE
	Adams
	Aguilar	Yes
	Anderle
	Baumgardner	Yes
	Blake
	Bommer
	Connors
	Dore	Yes
	Federspiel
	Freedman
	Martinez
	Massey
	McGowan
	Pace
	Raynes
	Schut
	Sills
	Singer	Yes
	Vasquez
	Jahn	Yes
	Pabon	Yes

YES: 6 NO: 0 EXC: 5 ABS: 0 FINAL ACTION: PASS

12:33 PM

Nicole Myers, Office of Legislative Legal Services, came to the table to discuss the legislators who would sponsor Bill 1 and Bill 2. Representative Singer and Senator Aguilar volunteered to sponsor Bill 1. Representative Singer volunteered to sponsor Bill 2. The committee agreed to allow the bill drafters to make any technical changes to the bill when incorporating amendments into the final drafts.

12:35 PM

Representative Pabon made some closing comments, and the committee was adjourned.