First Regular Session Seventieth General Assembly STATE OF COLORADO INTRODUCED LLS NO. 15-1016.01 Michael Dohr x4347 SENATE BILL 15-263 SENATE SPONSORSHIP Steadman and Holbert, HOUSE SPONSORSHIP (None), Senate Committees House Committees Business, Labor, & Technology A BILL FOR AN ACT Concerning creation of the Colorado marijuana control commission. Bill Summary (Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://www.leg.state.co.us/billsummaries.) The bill creates the Colorado marijuana control commission (commission). The commission consists of 5 members appointed by the governor with the consent and approval of the senate. The commission members must include: A certified peace officer with at least 5 years' law enforcement experience; An attorney with at least 5 years' regulatory law experience; An accountant with at least 5 years' experience in corporate finance; A business person with at least 5 years' management experience; and A person who is not employed in any of the 4 above industries. Commission members are compensated $100 per day spent on commission activities plus travel and reasonable expenses incurred in the course of their duties. Commission members must submit annual financial disclosures. The commission must hold at least one meeting per month. The commission has the following powers and duties: To promulgate rules related to medical and retail marijuana; To conduct hearings on medical or retail marijuana statutory or rule violations; To arrange for background checks for licensing; To continuously study and investigate medical and retail marijuana to determine if there are defects in the regulatory scheme or abuses in the administration and operation of the state licensing authority and to make changes to the regulatory scheme; and To issue licenses to those involved in the medical or retail marijuana business and take disciplinary action on the issued licenses. The commission's authority to promulgate rules, issue licenses, and take disciplinary action on licenses begins on July 1, 2016. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. In Colorado Revised Statutes, 12-43.3-201, amend (1) as follows: 12-43.3-201. State licensing authority - creation. (1) For the purpose of regulating and controlling the licensing of the cultivation, manufacture, distribution, and sale of medical marijuana and retail marijuana in this state, there is hereby created the state licensing authority, which shall be the executive director of the department of revenue or the deputy director of the department of revenue if the executive director so designates. The state licensing authority shall adopt regulations regarding retail marijuana and retail marijuana products by July 1, 2013. The state licensing authority, the Colorado marijuana control commission created in section 12-43.3-203, and the executive director of the state licensing authority shall exercise their respective powers and perform their respective duties and functions as specified in this article and article 43.4 of this title under the department of revenue as if the same were transferred to the department by a type 2 transfer, as such transfer is defined in the "Administrative Organization Act of 1968", article 1 of title 24, C.R.S.; except that the commission shall have full and exclusive authority to promulgate rules and regulations related to medical marijuana and retail marijuana without any approval by, or delegation of authority from, the department of revenue. SECTION 2. In Colorado Revised Statutes, repeal 12-43.3-202 (1) (a), (1) (b), and (1) (c); and repeal and relocate 12-43.3-202 (2). SECTION 3. In Colorado Revised Statutes, add section 12-43.3-203 as follows: 12-43.3-203. Colorado marijuana control commission - creation. (1) There is hereby created, within the state licensing authority, the Colorado marijuana control commission. The commission shall consist of five members, all of whom shall be citizens of the United States and residents of this state who have been residents of the state for the past five years. The members shall be appointed by the governor, with the consent and approval of the senate. The governor shall not appoint a person as a member if the person discharged a sentence for a conviction of a felony in the five years immediately preceding his or her appointment or if the person discharged a sentence for a conviction of a felony pursuant to any state or federal law regarding the possession, distribution, manufacturing, cultivation, or use of a controlled substance in the ten years immediately preceding his or her appointment or five years from May 28, 2013, whichever is longer; except that the governor may appoint the member if the member has a state felony conviction based on possession or use of marijuana or marijuana concentrate that would not be a felony if the person were convicted of the offense on the date he or she was appointed. No more than three of the five members shall be members of the same political party and each member shall be from a jurisdiction that permits the sale of either medical marijuana, retail marijuana, or both. At the first meeting of each fiscal year, a chairman and vice-chairman of the commission must be chosen from the membership by a majority of the members. Membership and operation of the commission must additionally meet the following requirements: (a) One member of the commission must be a certified peace officer who has at least five years' law enforcement experience, one member must be an attorney admitted to the practice of law in Colorado for not less than five years who has experience in regulatory law, one member must be a certified public accountant or public accountant who has been practicing in Colorado for at least five years and who has a comprehensive knowledge of the principles and practices of corporate finance, one member must have been engaged in business in a management-level capacity for at least five years, and one member must be a registered elector of the state who is not employed in any profession or industry otherwise described in this paragraph (a). (b) Initial members must be appointed to the commission by the governor as follows: One member to serve until July 1, 2017; one member to serve until July 1, 2018; one member to serve until July 1, 2019; and two members to serve until July 1, 2020. All subsequent appointments are for terms of four years. A commission member shall not serve more than two consecutive terms. (c) Any vacancy on the commission must be filled for the unexpired term in the same manner as the original appointment. The member appointed to fill such vacancy must be from the same category described in paragraph (a) of this subsection (1) as the member vacating the position. (d) Any member of the commission may be removed by the governor at any time. (e) The term of any member of the commission who misses more than two consecutive regular commission meetings without good cause is terminated and such member's successor must be appointed in the manner provided for appointments under this section. (f) Commission members receive one hundred dollars for each day spent conducting commission business as compensation for their services and shall be reimbursed for necessary travel and other reasonable expenses incurred in the performance of their official duties. The maximum annual compensation for each member of the commission, including reimbursement for necessary travel and other reasonable expenses incurred in the performance of their official duties, shall not exceed ten thousand dollars per year. (g) Prior to confirmation by the senate, each member shall file with the secretary of state a financial disclosure statement in the form required and prescribed by the executive director. Each member shall renew the statement by each January 1 of the member's term of office. (h) The commission shall hold at least one meeting each month and additional meetings as may be prescribed by rules of the commission. In addition, special meetings may be called by the chairman, any two commission members, or the executive director , if written notification of such meeting is delivered to each member at least seventy-two hours prior to such meeting. In emergency situations in which a majority of the commission certifies that exigencies of time require that the commission meet without delay, the requirements of public notice and of seventy-two hours' actual advance written notice to members may be dispensed with and commission members, as well as the public, must receive such notice as is reasonable under the circumstances. (i) A majority of the commission shall constitute a quorum, but the concurrence of a majority of the members appointed to the commission is required for any final determination by the commission. (j) The commission shall keep a complete and accurate record of all its meetings. SECTION 4. In Colorado Revised Statutes, add with amended and relocated provisions 12-43.3-204 as follows: 12-43.3-204. Commission - powers and duties related to medical marijuana. (1) In addition to any other powers and duties set forth in this article, the commission shall have the following powers and duties: (a) (I) Beginning July 1, 2016, to promulgate such rules and regulations governing the licensing, conducting, and operating of medical marijuana as it deems necessary to carry out the purposes of this article. The executive director shall prepare and submit to the commission written recommendations concerning proposed rules and regulations for this purpose. (II) All rules promulgated by the state licensing authority pursuant to section 12-43.3-202 (1) (b) prior to its repeal remain in effect until repealed or amended by rules of the commission. (b) To conduct hearings upon complaints charging violations of this article or rules and regulations promulgated pursuant to this article and to conduct such other hearings as may be required by rules of the commission; (c) To hear and determine at a public hearing any contested state license denial and any complaints against a licensee and to administer oaths and issue subpoenas to require the presence of persons and the production of papers, books, and records necessary to the determination of any hearing so held, all in accordance with article 4 of title 24, C.R.S. The commission may, at its discretion, delegate to the department of revenue hearing officers the authority to conduct licensing, disciplinary, and rule-making hearings under section 24-4-105, C.R.S. When conducting such hearings, the hearing officers shall be employees of the commission. (d) To enter into agreements with the Colorado bureau of investigation and state and local law enforcement agencies for the conduct of investigation, identification, or registration, or any combination thereof, of licensed operators and employees in licensed premises or in premises containing licensed premises in accordance with the provisions of this article, which conduct shall include, but not be limited to, performing background investigations and criminal records checks on an applicant applying for licensure pursuant to the provisions of this article and investigating violations of any provision of this article or of any rule or regulation promulgated by the commission pursuant to paragraph (a) of this subsection (1) discovered as a result of such investigatory process or discovered by the department of revenue or the commission in the course of conducting its business. Nothing in this section shall prevent or impair the Colorado bureau of investigation or state or local law enforcement agencies from engaging in the activities set forth in this paragraph (d) on their own initiative. (e) To conduct a continuous study and investigation of medical marijuana throughout the state for the purpose of ascertaining any defects in this article or in the rules and regulations promulgated pursuant to this article in order to discover any abuses in the administration and operation of the division or any violation of this article or any rule or regulation promulgated pursuant to this article; (f) To formulate and recommend changes to this article or any rule or regulation promulgated pursuant to this article for the purpose of preventing abuses and violations of this article or any of the rules or regulations promulgated pursuant to this article, to guard against the use of this article or any rule or regulation promulgated pursuant to this article as a cloak for the conducting of illegal activities, and to ensure that this article or any rule or regulation promulgated pursuant to this article shall be in such form and be so administered as to serve the true purpose and intent of this article; (g) To report immediately to the governor, the attorney general, the speaker of the house of representatives, the president of the senate, the minority leaders of both houses, and such other state officers as the commission deems appropriate concerning any laws which it determines require immediate amendment to prevent abuses and violations of this article or any rule or regulation promulgated pursuant to this article or to remedy undesirable conditions in connection with the administration or the operation of the state licensing authority; (h) To require such special reports from the director as it considers necessary; (i) Beginning July 1, 2016, to issue temporary or permanent licenses to those involved in the ownership of, participation in, or conduct of medical marijuana or retail marijuana; (j) Beginning July 1, 2016, upon complaint, or upon its own motion, to levy fines and to suspend or revoke, licenses issued pursuant to this article or article 43.3 of this title; (k) To obtain all information from licensees and other persons and agencies that the commission deems necessary or desirable in the conduct of its business; (l) To issue subpoenas for the appearance or production of persons, records, and things in connection with applications before the commission or in connection with disciplinary or contested cases considered by the commission; (m) To apply for injunctive or declaratory relief to enforce the provisions of this article and any rules promulgated pursuant to this article; (n) To inspect and examine without notice all premises wherein medical marijuana is cultivated, manufactured, sold, or distributed, and to summarily seize, remove, and impound, without notice or hearing from such premises, any equipment, devices, supplies, books, or records for the purpose of examination or inspection; (o) To enter into contracts with any governmental entity to carry out its duties without compliance with the provisions of the "Procurement Code", articles 101 to 112 of title 24, C.R.S. The contracts or formal agreements, or both, must be based on preestablished commission criteria specifying minimum levels of cooperation and conditions for payment. (p) To exercise such other incidental powers as may be necessary to ensure the safe and orderly regulation of medical marijuana and retail marijuana and the secure collection of all revenues, taxes, and license fees; (q) To establish internal control procedures for licensees, including accounting procedures, reporting procedures, and personnel policies; (r) To establish and collect fees for performing background checks on all applicants for licenses and on all persons with whom the commission or division may agree with or contract with for the providing of goods or services, as the commission deems appropriate; (s) To demand, at any time when business is being conducted, access to and inspection, examination, photocopying, and auditing of all papers, books, and records of applicants and licensees, on their premises or elsewhere as practicable and in the presence of the licensee or his agent, pertaining to the gross income produced by any medical marijuana or retail marijuana establishment; to require verification of income, and all other matters affecting the enforcement of the policies of the commission or any provision of this article; and to impound or remove all papers, books, and records of applicants and licensees, without hearing, for inspection or examination; and (t) To prescribe voluntary alternative methods for the making, filing, signing, subscribing, verifying, transmitting, receiving, or storing of returns or other documents. (2) (a) [Formerly 12-43.3-202 (2)] Rules promulgated pursuant to paragraph (b) (a) of subsection (1) of this section may include, but need not be limited to, the following subjects: (I) Compliance with, enforcement of, or violation of any provision of this article, section 18-18-406.3 (7), C.R.S., or any rule issued pursuant to this article, including procedures and grounds for denying, suspending, fining, restricting, or revoking a state license issued pursuant to this article; (II) Specifications of duties of officers and employees of the state licensing authority and commission; (III) Instructions for local licensing authorities and law enforcement officers; (IV) Requirements for inspections, investigations, searches, seizures, forfeitures, and such additional activities as may become necessary from time to time; (V) Creation of a range of penalties for use by the state licensing authority commission; (VI) Prohibition of misrepresentation and unfair practices; (VII) Control of informational and product displays on licensed premises; (VIII) Development of individual identification cards for owners, officers, managers, contractors, employees, and other support staff of entities licensed pursuant to this article, including a fingerprint-based criminal history record check as may be required by the state licensing authority commission prior to issuing a card; (IX) Identification of state licensees and their owners, officers, managers, and employees; (X) Security requirements for any premises licensed pursuant to this article, including, at a minimum, lighting, physical security, video, alarm requirements, and other minimum procedures for internal control as deemed necessary by the state licensing authority commission to properly administer and enforce the provisions of this article, including reporting requirements for changes, alterations, or modifications to the premises; (XI) Regulation of the storage of, warehouses for, and transportation of medical marijuana; (XII) Sanitary requirements for medical marijuana centers, including but not limited to sanitary requirements for the preparation of medical marijuana-infused products; (XIII) The specification of acceptable forms of picture identification that a medical marijuana center may accept when verifying a sale; (XIV) Labeling standards; (XIV.5) Prohibiting the sale of medical marijuana and medical marijuana-infused products unless the product is: (A) Packaged in packaging meeting requirements established by the state licensing authority similar to the federal "Poison Prevention Packaging Act of 1970", 15 U.S.C. sec. 1471 et seq.; or (B) Placed in an opaque and resealable exit package or container at the point of sale prior to exiting the store, and the container or package meets the requirements established by the state licensing authority commission. (XV) Records to be kept by licensees and the required availability of the records; (XVI) State licensing procedures, including procedures for renewals, reinstatements, initial licenses, and the payment of licensing fees; (XVII) The reporting and transmittal of monthly sales tax payments by medical marijuana centers; (XVIII) Authorization for the department of revenue to have access to licensing information to ensure sales and income tax payment and the effective administration of this article; (XIX) Authorization for the department of revenue to issue administrative citations and procedures for issuing, appealing, and creating a citation violation list and schedule of penalties; and (XX) Such other matters as are necessary for the fair, impartial, stringent, and comprehensive administration of this article. (b) Nothing in this article shall be construed as delegating to the state licensing authority commission the power to fix prices for medical marijuana. (c) Nothing in this article shall be construed to limit a law enforcement agency's ability to investigate unlawful activity in relation to a medical marijuana center, optional premises cultivation operation, or medical marijuana-infused products manufacturer. A law enforcement agency shall have the authority to run a Colorado crime information center criminal history record check of a primary caregiver, licensee, or employee of a licensee during an investigation of unlawful activity related to medical marijuana. SECTION 5. In Colorado Revised Statutes, amend 12-43.4-201 as follows: 12-43.4-201. State licensing authority. For the purpose of regulating and controlling the licensing of the cultivation, manufacture, distribution, sale, and testing of retail marijuana and retail marijuana products in this state, the state licensing authority created in section 12-43.3-201 and the Colorado marijuana control commission created in section 12-43.3-203 shall also have regulatory authority for retail marijuana and retail marijuana products as permitted in section 16 of article XVIII of the state constitution and this article. The Colorado marijuana control commission created in section 12-43.3-203 shall have full and exclusive authority to promulgate rules related to medical marijuana. SECTION 6. In Colorado Revised Statutes, repeal 12-43.4-202 (2) (a), (2) (b), and (2) (c); and repeal and relocate 12-43.4-202 (3) (b), (3) (c), (3) (d), and (3) (e). SECTION 7. In Colorado Revised Statutes, add with amended and relocated provisions 12-43.4-203 as follows: 12-43.4-203. Powers and duties of marijuana control commission related to retail marijuana. (1) In addition to any other powers and duties set forth in this article, the commission shall have the following powers and duties: (a) (I) Beginning July 1, 2016, to promulgate such rules and regulations governing the licensing, conducting, and operating of retail marijuana as it deems necessary to carry out the purposes of this article. The executive director shall prepare and submit to the commission written recommendations concerning proposed rules and regulations for this purpose. (II) All rules promulgated by the state licensing authority pursuant to section 12-43.4-202 prior to its repeal remain in effect until repealed or amended by rules of the commission. (b) To conduct hearings upon complaints charging violations of this article or rules and regulations promulgated pursuant to this article and to conduct such other hearings as may be required by rules of the commission; (c) To hear and determine at a public hearing any contested state license denial and any complaints against a licensee and to administer oaths and issue subpoenas to require the presence of persons and the production of papers, books, and records necessary to the determination of any hearing so held, all in accordance with article 4 of title 24, C.R.S. The commission may, at its discretion, delegate to the department of revenue hearing officers the authority to conduct licensing, disciplinary, and rule-making hearings under section 24-4-105, C.R.S. When conducting such hearings, the hearing officers shall be employees of the commission. (d) To enter into agreements with the Colorado bureau of investigation and state and local law enforcement agencies for the conduct of investigation, identification, or registration, or any combination thereof, of licensed operators and employees in licensed premises or in premises containing licensed premises in accordance with the provisions of this article, which conduct shall include, but not be limited to, performing background investigations and criminal records checks on an applicant applying for licensure pursuant to the provisions of this article and investigating violations of any provision of this article or of any rule or regulation promulgated by the commission pursuant to paragraph (a) of this subsection (1) discovered as a result of such investigatory process or discovered by the department of revenue or the commission in the course of conducting its business. Nothing in this section shall prevent or impair the Colorado bureau of investigation or state or local law enforcement agencies from engaging in the activities set forth in this paragraph (d) on their own initiative. (e) To conduct a continuous study and investigation of retail marijuana throughout the state for the purpose of ascertaining any defects in this article or in the rules and regulations promulgated pursuant to this article in order to discover any abuses in the administration and operation of the division or any violation of this article or any rule or regulation promulgated pursuant to this article; (f) To formulate and recommend changes to this article or any rule or regulation promulgated pursuant to this article for the purpose of preventing abuses and violations of this article or any of the rules or regulations promulgated pursuant to this article, to guard against the use of this article or any rule or regulation promulgated pursuant to this article as a cloak for the conducting of illegal activities, and to ensure that this article or any rule or regulation promulgated pursuant to this article shall be in such form and be so administered as to serve the true purpose and intent of this article; (g) To report immediately to the governor, the attorney general, the speaker of the house of representatives, the president of the senate, the minority leaders of both houses, and such other state officers as the commission deems appropriate concerning any laws which it determines require immediate amendment to prevent abuses and violations of this article or any rule promulgated pursuant to this article or to remedy undesirable conditions in connection with the administration or the operation of the state licensing authority; (h) To require such special reports from the director as it considers necessary; (i) Beginning July 1, 2016, to issue temporary or permanent licenses to those involved in the ownership of, participation in, or conduct of medical marijuana or retail marijuana; (j) Beginning July 1, 2016, upon complaint, or upon its own motion, to levy fines and to suspend or revoke licenses issued pursuant to this article or article 43.3 of this title; (k) To obtain all information from licensees and other persons and agencies that the commission deems necessary or desirable in the conduct of its business; (l) To issue subpoenas for the appearance or production of persons, records, and things in connection with applications before the commission or in connection with disciplinary or contested cases considered by the commission; (m) To apply for injunctive or declaratory relief to enforce the provisions of this article and any rules promulgated pursuant to this article; (n) To inspect and examine without notice all premises wherein retail marijuana is cultivated, manufactured, sold, or distributed and to summarily seize, remove, and impound, without notice or hearing from such premises, any equipment, devices, supplies, books, or records for the purpose of examination or inspection; (o) To enter into contracts with any governmental entity to carry out its duties without compliance with the provisions of the "Procurement Code", articles 101 to 112 of title 24, C.R.S. The contracts or formal agreements, or both, must be based on preestablished commission criteria specifying minimum levels of cooperation and conditions for payment. (p) To exercise such other incidental powers as may be necessary to ensure the safe and orderly regulation of medical marijuana and retail marijuana and the secure collection of all revenues, taxes, and license fees; (q) To establish internal control procedures for licensees, including accounting procedures, reporting procedures, and personnel policies; (r) To establish and collect fees for performing background checks on all applicants for licenses and on all persons with whom the commission or division may agree with or contract with for the providing of goods or services, as the commission deems appropriate; (s) To demand, at any time when business is being conducted, access to and inspection, examination, photocopying, and auditing of all papers, books, and records of applicants and licensees, on their premises or elsewhere as practicable and in the presence of the licensee or his agent, pertaining to the gross income produced by any medical marijuana or retail marijuana establishment; to require verification of income, and all other matters affecting the enforcement of the policies of the commission or any provision of this article; and to impound or remove all papers, books, and records of applicants and licensees, without hearing, for inspection or examination; and (t) To prescribe voluntary alternative methods for the making, filing, signing, subscribing, verifying, transmitting, receiving, or storing of returns or other documents. (2) (a) [Formerly 12-43.4-202 (3) (a)] Rules promulgated pursuant to paragraph (b) of subsection (2) of this section section 12-43.3-203 (1) (a), must include, but need not be limited to, the following subjects: (I) Procedures consistent with this article for the issuance, renewal, suspension, and revocation of licenses to operate retail marijuana establishments; (II) Subject to the limitations contained in section 16 (5) (a) (II) of article XVIII of the state constitution and consistent with this article, a schedule of application, licensing, and renewal fees for retail marijuana establishments; (III) Qualifications for licensure under this article, including but not limited to the requirement for a fingerprint-based criminal history record check for all owners, officers, managers, contractors, employees, and other support staff of entities licensed pursuant to this article; (IV) (A) Establishing a marijuana and marijuana products independent testing and certification program, within an implementation time frame established by the department, requiring licensees to test marijuana to ensure at a minimum that products sold for human consumption do not contain contaminants that are injurious to health and to ensure correct labeling. (B) Testing shall include, but not be limited to, analysis for residual solvents, poisons, or toxins; harmful chemicals; dangerous molds or mildew; filth; and harmful microbials such as E. Coli or salmonella and pesticides. (C) In the event that test results indicate the presence of quantities of any substance determined to be injurious to health, such products shall be immediately quarantined and immediate notification to the marijuana enforcement division shall be made. The adulterated product shall be documented and properly destroyed. (D) Testing shall also verify THC potency representations for correct labeling. (E) The agency shall determine an acceptable variance for potency representations and procedures to address potency misrepresentations. (F) The agency shall determine the protocols and frequency of marijuana testing by licensees. (G) The executive director of the department of public health and environment shall provide to the state licensing authority commission standards for licensing laboratories pursuant to the requirements as outlined in sub-subparagraph (A) of this subparagraph (IV) for marijuana and marijuana products. (V) Security requirements for any premises licensed pursuant to this article, including, at a minimum, lighting, physical security, video, and alarm requirements, and other minimum procedures for internal control as deemed necessary by the state licensing authority commission to properly administer and enforce the provisions of this article, including reporting requirements for changes, alterations, or modifications to the premises; (VI) Requirements to prevent the sale or diversion of retail marijuana and retail marijuana products to persons under twenty-one years of age; (VII) Labeling requirements for retail marijuana and retail marijuana products sold by a retail marijuana establishment that are at least as stringent as imposed by section 25-4-1614 (3) (a), C.R.S., and include but are not limited to: (A) The license number of the retail marijuana cultivation license; (B) The license number of the retail marijuana store; (C) An identity statement and standardized graphic symbol; (D) The batch number; (E) A net weight statement; (F) THC potency and the potency of such other cannabinoids or other chemicals, including but not limited to CBD, as determined relevant by the state licensing authority; (G) A list of the nonorganic pesticides, fungicides, herbicides, and solvents used during cultivation or production; (H) A statement to the effect of: "This product contains marijuana and was cultivated or produced without regulatory oversight for health, safety, or efficacy, and there may be health risks associated with the consumption of the product."; (I) Warning labels; (J) Solvents used in the extraction process; (K) Amount of THC per serving and the number of servings per package for marijuana products; (L) A list of ingredients and possible allergens for retail marijuana products; (M) A recommended use by or expiration date for retail marijuana products; (N) A nutritional fact panel for edible marijuana products; and (O) A universal symbol indicating the package contains marijuana; (VIII) Health and safety regulations and standards for the manufacture of retail marijuana products and the cultivation of retail marijuana; (IX) Limitations on the display of retail marijuana and retail marijuana products; (X) Regulation of the storage of, warehouses for, and transportation of retail marijuana and retail marijuana products; (XI) Sanitary requirements for retail marijuana establishments, including but not limited to sanitary requirements for the preparation of retail marijuana products; (XII) Records to be kept by licensees and the required availability of the records; (XIII) The reporting and transmittal of monthly sales tax payments by retail marijuana stores and any applicable excise tax payments by retail marijuana cultivation facilities; (XIV) Authorization for the department of revenue to have access to licensing information to ensure sales, excise, and income tax payment and the effective administration of this article; (XV) Compliance with, enforcement of, or violation of any provision of this article, section 18-18-406.3 (7), C.R.S., or any rule issued pursuant to this article, including procedures and grounds for denying, suspending, fining, restricting, or revoking a state license issued pursuant to this article; and (XVI) Establishing a schedule of penalties and procedures for issuing and appealing citations for violation of statutes and rules and issuing administrative citations. (b) [Formerly 12-43.4-202 (3) (b)] Rules promulgated pursuant to paragraph (b) of subsection (2) of this section section 12-43.3-203 (1) (a) must also include the following subjects: (I) Specifications of duties of officers and employees of the state licensing authority; (II) Instructions for local jurisdictions and law enforcement officers; (III) Requirements for inspections, investigations, searches, seizures, forfeitures, and such additional activities as may become necessary from time to time; (IV) Prohibition of misrepresentation and unfair practices; (V) Development of individual identification cards for owners, officers, managers, contractors, employees, and other support staff of entities licensed pursuant to this article, including a fingerprint-based criminal history record check as may be required by the state licensing authority commission prior to issuing a card; (VI) Identification of state licensees and their owners, officers, managers, and employees; (VII) The specification of acceptable forms of picture identification that a retail marijuana store may accept when verifying a sale, including but not limited to government-issued identification cards; (VIII) State licensing procedures, including procedures for renewals, reinstatements, initial licenses, and the payment of licensing fees; and (IX) Such other matters as are necessary for the fair, impartial, stringent, and comprehensive administration of this article. (c) [Formerly 12-43.4-202 (3) (c)] Rules promulgated pursuant to paragraph (b) of subsection (2) of this section section 12-43.3-203 (1) (a) must also include the following subjects, and the state licensing authority commission may seek the assistance of the department of public health and environment when necessary before promulgating the rules: (I) Signage, marketing, and advertising, including but not limited to a prohibition on mass-market campaigns that have a high likelihood of reaching persons under twenty-one years of age and other such rules that may include: (A) Allow packaging and accessory branding; (B) A prohibition on health or physical benefit claims in advertising, merchandising, and packaging; (C) A prohibition on unsolicited pop-up advertising on the internet; (D) A prohibition on banner ads on mass-market web sites; (E) A prohibition on opt-in marketing that does not permit an easy and permanent opt-out feature; and (F) A prohibition on marketing directed towards location-based devices, including but not limited to cellular phones, unless the marketing is a mobile device application installed on the device by the owner of the device who is twenty-one years of age or older and includes a permanent and easy opt-out feature; (II) Requiring that magazines whose primary focus is marijuana or marijuana businesses are only sold in retail marijuana stores or behind the counter in establishments where persons under twenty-one years of age are present; (III) Prohibiting the sale of retail marijuana and retail marijuana products unless: (A) The product is packaged by the retail marijuana store or the retail marijuana products manufacturer in packaging meeting requirements established by the state licensing authority similar to the federal "Poison Prevention Packaging Act of 1970", 15 U.S.C. sec. 1471 et seq.; or (B) The product is placed in an opaque and resealable exit package or container meeting requirements established by the state licensing authority at the point of sale prior to exiting the store; (IV) The safe and lawful transport of retail marijuana and retail marijuana products between the licensed business and testing laboratories; (V) A standardized marijuana serving size amount for edible retail marijuana products that does not contain more than ten milligrams of active THC designed only to provide consumers with information about the total number of servings of active THC in a particular retail marijuana product, not as a limitation on the total amount of THC in any particular item, labeling requirements regarding servings for edible retail marijuana products, and limitations on the total amount of active THC in a sealed internal package that is no more than one hundred milligrams of active THC; (VI) Labeling guidelines concerning the total content of THC per unit of weight; (VII) Prohibition or regulation of additives to any retail marijuana product, including but not limited to those that are toxic, designed to make the product more addictive, designed to make the product more appealing to children, or misleading to consumers, but not including common baking and cooking items; and (VIII) Permission for a local fire department to conduct an annual fire inspection of a retail marijuana cultivation facility. (d) [Formerly 12-43.4-202 (3) (d)] Nothing in this article shall be construed as delegating to the state licensing authority commission the power to fix prices for retail marijuana. (e) [Formerly 12-43.4-202 (3) (e)] Nothing in this article shall be construed to limit a law enforcement agency's ability to investigate unlawful activity in relation to a retail marijuana establishment. A law enforcement agency shall have the authority to run a Colorado crime information center criminal history record check of a licensee, or employee of a licensee, during an investigation of unlawful activity related to retail marijuana and retail marijuana products. SECTION 8. In Colorado Revised Statutes, 12-43.3-104, amend (1) and (14.5); and add (1.3) as follows: 12-43.3-104. Definitions. As used in this article, unless the context otherwise requires: (1) "Good cause", for purposes of refusing or denying a license renewal, reinstatement, or initial license issuance, means: "Commission" means the Colorado marijuana control commission created in section 12-43.3-203. (a) The licensee or applicant has violated, does not meet, or has failed to comply with any of the terms, conditions, or provisions of this article, any rules promulgated pursuant to this article, or any supplemental local law, rules, or regulations; (b) The licensee or applicant has failed to comply with any special terms or conditions that were placed on its license pursuant to an order of the state or local licensing authority; (c) The licensed premises have been operated in a manner that adversely affects the public health or welfare or the safety of the immediate neighborhood in which the establishment is located. (1.3) "Good cause", for purposes of refusing or denying a license renewal, reinstatement, or initial license issuance, means: (a) The licensee or applicant has violated, does not meet, or has failed to comply with any of the terms, conditions, or provisions of this article; any rules promulgated pursuant to this article; or any supplemental local law, rules, or regulations; (b) The licensee or applicant has failed to comply with any special terms or conditions that were placed on its license pursuant to an order of the commission or local licensing authority; (c) The licensed premises have been operated in a manner that adversely affects the public health or welfare or the safety of the immediate neighborhood in which the establishment is located. (14.5) "Resealable" means that the package continues to function with effectiveness specifications, which shall be established by the state licensing authority similar to the federal "Poison Prevention Packaging Act of 1970", 15 U.S.C. sec. 1471 et seq., for the number of openings and closings customary for its size and contents, which shall be determined by the state licensing authority commission. SECTION 9. In Colorado Revised Statutes, amend 12-43.3-105 as follows: 12-43.3-105. Limited access areas. Subject to the provisions of section 12-43.3-701, a limited access area shall be a building, room, or other contiguous area upon the licensed premises where medical marijuana is grown, cultivated, stored, weighed, displayed, packaged, sold, or possessed for sale, under control of the licensee, with limited access to only those persons licensed by the state licensing authority commission. All areas of ingress or egress to limited access areas shall be clearly identified as such by a sign as designated by the state licensing authority. SECTION 10. In Colorado Revised Statutes, 12-43.3-303, amend (5) as follows: 12-43.3-303. Results of investigation - decision of authorities. (5) After approval of an application for conditional state licensure, the state licensing authority commission shall notify the local licensing authority of such approval. After approval of an application for local licensure, the local licensing authority shall notify the state licensing authority commission of such approval, who shall investigate and either approve or disapprove the application for state licensure. SECTION 11. In Colorado Revised Statutes, 12-43.3-304, amend (1) and (2) as follows: 12-43.3-304. Medical marijuana license bond. (1) Before the state licensing authority commission issues a state license to an applicant, the applicant shall procure and file with the state licensing authority evidence of a good and sufficient bond in the amount of five thousand dollars with corporate surety thereon duly licensed to do business with the state, approved as to form by the attorney general of the state, and conditioned that the applicant shall report and pay all sales and use taxes due to the state, or for which the state is the collector or collecting agent, in a timely manner, as provided in law. (2) A corporate surety shall not be required to make payments to the state claiming under such bond until a final determination of failure to pay taxes due to the state has been made by the state licensing authority commission or a court of competent jurisdiction. SECTION 12. In Colorado Revised Statutes, 12-43.3-305, amend (1), (2), and (2.5) as follows: 12-43.3-305. State licensing authority - application and issuance procedures. (1) Applications for a state license under the provisions of this article shall be made to the state licensing authority on forms prepared and furnished by the state licensing authority and shall set forth such information as the state licensing authority commission may require to enable the state licensing authority commission to determine whether a state license should be granted. The information shall include the name and address of the applicant, the names and addresses of the officers, directors, or managers, and all other information deemed necessary by the state licensing authority. Each application shall be verified by the oath or affirmation of such person or persons as the state licensing authority may prescribe. (2) The state licensing authority commission shall issue a state license to a medical marijuana center, an optional premises cultivation operation, or a medical marijuana-infused products manufacturer pursuant to this section upon satisfactory completion of the applicable criminal history background check associated with the application, and the state license is conditioned upon local licensing authority approval. A license applicant is prohibited from operating a licensed medical marijuana business without both state and local licensing authority approval. The denial of an application by the local licensing authority shall be considered as a basis for the state licensing authority commission to revoke the state-issued license. (2.5) An applicant that has been permitted to operate a medical marijuana business under the provisions of section 12-43.3-103 (1) (b) and has been issued a conditional license by the state licensing authority commission pursuant to subsection (2) of this section may continue to operate the business while an application is pending with the local licensing authority. If the local licensing authority denies the license application, the medical marijuana business shall cease operations upon receiving the denial. The denial of an application by the local licensing authority shall be considered as a basis for the state licensing authority commission to revoke the state-issued license. SECTION 13. In Colorado Revised Statutes, amend 12-43.3-306 as follows: 12-43.3-306. Denial of application. (1) The state licensing authority commission shall deny a state license if the premises on which the applicant proposes to conduct its business does not meet the requirements of this article or for reasons set forth in section 12-43.3-104 (1) (c) section 12-43.3-104 (1.3) (c) or 12-43.3-305, and the state licensing authority commission may deny a license for good cause as defined by section 12-43.3-104 (1) (a) or (1) (b) section 12-43.3-104 (1.3) (a) or (1.3) (b). (2) If the state licensing authority commission denies a state license pursuant to subsection (1) of this section, the applicant shall be entitled to a hearing pursuant to section 24-4-104 (9), C.R.S., and judicial review pursuant to section 24-4-106, C.R.S. The state licensing authority commission shall provide written notice of the grounds for denial of the state license to the applicant and to the local licensing authority at least fifteen days prior to the hearing. SECTION 14. In Colorado Revised Statutes, 12-43.3-307, amend (1) (h) and (1) (m) as follows: 12-43.3-307. Persons prohibited as licensees. (1) A license provided by this article shall not be issued to or held by: (h) A person who has discharged a sentence in the five years immediately preceding the application date for a conviction of a felony or a person who at any time has been convicted of a felony pursuant to any state or federal law regarding the possession, distribution, manufacturing, cultivation, or use of a controlled substance; except that the licensing authority commission may grant a license to an employee if the employee has a state felony conviction based on possession or use of a controlled substance that would not be a felony if the person were convicted of the offense on the date he or she applied for licensure; (m) An owner, as defined by rule of the state licensing authority commission, who has not been a resident of Colorado for at least two years prior to the date of the owner's application. SECTION 15. In Colorado Revised Statutes, 12-43.3-308, amend (1) introductory portion and (1) (a) as follows: 12-43.3-308. Restrictions for applications for new licenses. (1) The state commission or a local licensing authority shall not receive or act upon an application for the issuance of a state or local license pursuant to this article: (a) If the application for a state or local license concerns a particular location that is the same as or within one thousand feet of a location for which, within the two years immediately preceding the date of the application, the state commission or a local licensing authority denied an application for the same class of license due to the nature of the use or other concern related to the location; SECTION 16. In Colorado Revised Statutes, 12-43.3-309, amend (2) as follows: 12-43.3-309. Transfer of ownership. (2) For a transfer of ownership, a license holder shall apply to the state and local licensing authorities on forms prepared and furnished by the state licensing authority. In determining whether to permit a transfer of ownership, the state commission and local licensing authorities shall consider only the requirements of this article, any rules promulgated by the state licensing authority commission, and any other local restrictions. The local licensing authority may hold a hearing on the application for transfer of ownership. The local licensing authority shall not hold a hearing pursuant to this subsection (2) until the local licensing authority has posted a notice of hearing in the manner described in section 12-43.3-302 (2) on the licensed medical marijuana center premises for a period of ten days and has provided notice of the hearing to the applicant at least ten days prior to the hearing. Any transfer of ownership hearing by the state licensing authority commission shall be held in compliance with the requirements specified in section 12-43.3-302. SECTION 17. In Colorado Revised Statutes, 12-43.3-310, amend (2), (3), (7), (9) (b), and (13) (b) as follows: 12-43.3-310. Licensing in general. (2) A medical marijuana center, optional premises cultivation operation, or medical marijuana-infused products manufacturer may not operate until it has been licensed by the local licensing authority and the state licensing authority commission pursuant to this article. If the state licensing authority commission issues the applicant a state license and the local licensing authority subsequently denies the applicant a license, the state licensing authority commission shall consider the local licensing authority denial as a basis for the revocation of the state-issued license. In connection with a license, the applicant shall provide a complete and accurate list of all owners, officers, and employees who manage, own, or are otherwise substantially associated with the operation and shall provide a complete and accurate application as required by the state licensing authority. (3) A medical marijuana center, optional premises cultivation operation, or medical marijuana-infused products manufacturer shall notify the state licensing authority in writing within ten days after an owner, officer, or manager ceases to work at, manage, own, or otherwise be associated with the operation. The owner, officer, or manager shall surrender to the state licensing authority any identification card that may have been issued by the state licensing authority commission on or before the date of the notification. (7) Before granting a local or state license, the respective commission or licensing authority may consider, except where this article specifically provides otherwise, the requirements of this article and any rules promulgated pursuant to this article, and all other reasonable restrictions that are or may be placed upon the licensee by the commission or local licensing authority. With respect to a second or additional license for the same licensee or the same owner of another licensed business pursuant to this article, each the commission and local licensing authority shall consider the effect on competition of granting or denying the additional licenses to such licensee and shall not approve an application for a second or additional license that would have the effect of restraining competition. (9) (b) A local licensing authority shall not transfer location of or renew a license to sell medical marijuana until the applicant for the license provides verification that a license was issued and granted by the state licensing authority commission for the previous license term. The state licensing authority commission shall not transfer location of or renew a state license until the applicant provides verification that a license was issued and granted by the local licensing authority for the previous license term. (13) (b) In permitting a change of location, the state commission and local licensing authorities shall consider all reasonable restrictions that are or may be placed upon the new location by the governing board or local licensing authority of the municipality, city and county, or county and any such change in location shall be in accordance with all requirements of this article and rules promulgated pursuant to this article. SECTION 18. In Colorado Revised Statutes, amend 12-43.3-311 as follows: 12-43.3-311. License renewal. (1) Ninety days prior to the expiration date of an existing license, the state licensing authority shall notify the licensee of the expiration date by first class mail at the licensee's address of record with the state licensing authority. A licensee shall apply for the renewal of an existing license to the local licensing authority not less than forty-five days and to the state licensing authority not less than thirty days prior to the date of expiration. A local licensing authority shall not accept an application for renewal of a license after the date of expiration, except as provided in subsection (2) of this section. The state licensing authority commission may extend the expiration date of the license and accept a late application for renewal of a license provided that the applicant has filed a timely renewal application with the local licensing authority. All renewals filed with the local licensing authority and subsequently approved by the local licensing authority shall next be processed by the state licensing authority commission. The state commission or the local licensing authority, in its discretion, subject to the requirements of this subsection (1) and subsection (2) of this section and based upon reasonable grounds, may waive the forty-five-day or thirty-day time requirements set forth in this subsection (1). The local licensing authority may hold a hearing on the application for renewal only if the licensee has had complaints filed against it, has a history of violations, or there are allegations against the licensee that would constitute good cause. The local licensing authority shall not hold a renewal hearing provided for by this subsection (1) for a medical marijuana center until it has posted a notice of hearing on the licensed medical marijuana center premises in the manner described in section 12-43.3-302 (2) for a period of ten days and provided notice to the applicant at least ten days prior to the hearing. The local licensing authority may refuse to renew any license for good cause, subject to judicial review. (2) (a) Notwithstanding the provisions of subsection (1) of this section, a licensee whose license has been expired for not more than ninety days may file a late renewal application upon the payment of a nonrefundable late application fee of five hundred dollars to the local licensing authority. A licensee who files a late renewal application and pays the requisite fees may continue to operate until both the state commission and local licensing authorities have taken final action to approve or deny the licensee's late renewal application unless the state commission or local licensing authority summarily suspends the license pursuant to article 4 of title 24, C.R.S., this article, and rules promulgated pursuant to this article. (b) The state and local licensing authorities may not accept a late renewal application more than ninety days after the expiration of a licensee's permanent annual license. A licensee whose permanent annual license has been expired for more than ninety days shall not cultivate, manufacture, distribute, or sell any medical marijuana until all required licenses have been obtained. (c) Notwithstanding the amount specified for the late application fee in paragraph (a) of this subsection (2), the state licensing authority commission by rule or as otherwise provided by law may reduce the amount of the fee if necessary pursuant to section 24-75-402 (3), C.R.S., by reducing the uncommitted reserves of the fund to which all or any portion of the fee is credited. After the uncommitted reserves of the fund are sufficiently reduced, the state licensing authority commission by rule or as otherwise provided by law may increase the amount of the fee as provided in section 24-75-402 (4), C.R.S. SECTION 19. In Colorado Revised Statutes, amend 12-43.3-312 as follows: 12-43.3-312. Inactive licenses. The state commission or local licensing authority, in its discretion, may revoke or elect not to renew any license if it determines that the licensed premises have been inactive, without good cause, for at least one year. SECTION 20. In Colorado Revised Statutes, 12-43.3-313, amend (1) and (2) as follows: 12-43.3-313. Unlawful financial assistance. (1) The state licensing authority commission, by rule and regulation, shall require a complete disclosure of all persons having a direct or indirect financial interest, and the extent of such interest, in each license issued under this article. (2) A person shall not have an unreported financial interest in a license pursuant to this article unless that person has undergone a fingerprint-based criminal history record check as provided for by the state licensing authority commission in its rules; except that this subsection (2) does not apply to banks or savings and loan associations supervised and regulated by an agency of the state or federal government, or to FHA-approved mortgagees, or to stockholders, directors, or officers thereof. SECTION 21. In Colorado Revised Statutes, 12-43.3-401, amend (1) introductory portion and (1) (d) as follows: 12-43.3-401. Classes of licenses. (1) For the purpose of regulating the cultivation, manufacture, distribution, and sale of medical marijuana, the state licensing authority commission in its discretion, upon application in the prescribed form made to it, may issue and grant to the applicant a license from any of the following classes, subject to the provisions and restrictions provided by this article: (d) Occupational licenses and registrations for owners, managers, operators, employees, contractors, and other support staff employed by, working in, or having access to restricted areas of the licensed premises, as determined by the state licensing authority commission. The state licensing authority commission may take any action with respect to a registration pursuant to this article as it may with respect to a license pursuant to this article, in accordance with the procedures established pursuant to this article. SECTION 22. In Colorado Revised Statutes, 12-43.3-402, amend (3), (5.5), and (6) as follows: 12-43.3-402. Medical marijuana center license. (3) Every person selling medical marijuana as provided for in this article shall sell only medical marijuana grown in its medical marijuana optional premises licensed pursuant to this article. In addition to medical marijuana, a medical marijuana center may sell no more than six immature plants to a patient; except that a medical marijuana center may sell more than six immature plants, but may not exceed half the recommended plant count, to a patient who has been recommended an expanded plant count by his or her recommending physician. A medical marijuana center may sell immature plants to a primary caregiver, another medical marijuana center, or a medical marijuana-infused product manufacturer pursuant to rules promulgated by the state licensing authority commission. The provisions of this subsection (3) shall not apply to medical marijuana-infused products. (5.5) Transactions for the sale of medical marijuana or a medical marijuana-infused product at a medical marijuana center may be completed by using an automated machine that is in a restricted access area of the center if the machine complies with the rules promulgated by the state licensing authority commission regarding the transaction of sale of product at a medical marijuana center and the transaction complies with subsection (5) of this section. (6) A medical marijuana center may provide a sample of its products to a laboratory that has an occupational license from the state licensing authority commission for testing and research purposes. The laboratory may develop, test, and produce medical marijuana-based products. The laboratory may contract method or product development with a licensed medical marijuana center or licensed medical marijuana infused-product manufacturer. The state licensing authority commission shall promulgate rules pursuant to its authority in section 12-43.3-202 (1) (b) section 12-43.3-203 (2) (a) related to acceptable testing and research practices, including but not limited to testing, standards, quality control analysis, equipment certification and calibration, and chemical identification and other substances used in bona fide research methods. A laboratory that has an occupational license from the state licensing authority commission for testing purposes shall not have any interest in a licensed medical marijuana center or a licensed medical marijuana-infused products manufacturer. SECTION 23. In Colorado Revised Statutes, 12-43.3-404, amend (4) and (10) as follows: 12-43.3-404. Medical marijuana-infused products manufacturing license. (4) All licensed premises on which medical marijuana-infused products are manufactured shall meet the sanitary standards for medical marijuana-infused product preparation promulgated pursuant to section 12-43.3-202 (2) (a) (XII) section 12-43.4-203 (2) (a) (XII). (10) A medical marijuana-infused products manufacturer may provide a sample of its products to a laboratory that has an occupational license from the state licensing authority commission for testing and research purposes. The state licensing authority commission shall promulgate rules pursuant to its authority in section 12-43.3-202 (1) (b) section 12-43.4-203 (2) (a) related to acceptable testing and research practices. A laboratory that has an occupational license from the state licensing authority commission for testing purposes shall not have any interest in a licensed medical marijuana center or a licensed medical marijuana-infused products manufacturer. SECTION 24. In Colorado Revised Statutes, 12-43.3-501, amend (3) (a) introductory portion, (3) (b), and (3) (d) as follows: 12-43.3-501. Marijuana cash fund. (3) (a) The state licensing authority commission shall establish fees for processing the following types of applications, licenses, notices, or reports required to be submitted to the state licensing authority: (b) The amounts of such fees, when added to the other fees transferred to the fund pursuant to this section, shall reflect the actual direct and indirect costs of the commission and state licensing authority in the administration and enforcement of this article so that the fees avoid exceeding the statutory limit on uncommitted reserves in administrative agency cash funds as set forth in section 24-75-402 (3), C.R.S. (d) At least annually, the state licensing authority commission shall review the amounts of the fees and, if necessary, adjust the amounts to reflect the direct and indirect costs of the state licensing authority. SECTION 25. In Colorado Revised Statutes, 12-43.3-502, amend (2) as follows: 12-43.3-502. Fees - allocation. (2) The expenditures of the commission and state licensing authority shall be paid out of appropriations from the marijuana cash fund created in section 12-43.3-501. SECTION 26. In Colorado Revised Statutes, 12-43.3-601, amend (1), (2), (3) (a) introductory portion, (4), (5), and (6) as follows: 12-43.3-601. Suspension - revocation - fines. (1) In addition to any other sanctions prescribed by this article or rules promulgated pursuant to this article, the state licensing authority commission or a local licensing authority has the power, on its own motion or on complaint, after investigation and opportunity for a public hearing at which the licensee shall be afforded an opportunity to be heard, to suspend or revoke a license issued by the respective authority for a violation by the licensee or by any of the agents or employees of the licensee of the provisions of this article, or any of the rules promulgated pursuant to this article, or of any of the terms, conditions, or provisions of the license issued by the state commission or local licensing authority. The state licensing authority commission or a local licensing authority has the power to administer oaths and issue subpoenas to require the presence of persons and the production of papers, books, and records necessary to the determination of a hearing that the state commission or local licensing authority is authorized to conduct. (2) The state commission or local licensing authority shall provide notice of suspension, revocation, fine, or other sanction, as well as the required notice of the hearing pursuant to subsection (1) of this section, by mailing the same in writing to the licensee at the address contained in the license. Except in the case of a summary suspension, a suspension shall not be for a longer period than six months. If a license is suspended or revoked, a part of the fees paid therefore shall not be returned to the licensee. Any license or permit may be summarily suspended by the issuing commission or local licensing authority without notice pending any prosecution, investigation, or public hearing pursuant to the terms of section 24-4-104 (4), C.R.S. Nothing in this section shall prevent the summary suspension of a license pursuant to section 24-4-104 (4), C.R.S. Each patient registered with a medical marijuana center that has had its license summarily suspended may immediately transfer his or her primary center to another licensed medical marijuana center. (3) (a) Whenever a decision of the state licensing authority commission or a local licensing authority suspending a license for fourteen days or less becomes final, the licensee may, before the operative date of the suspension, petition for permission to pay a fine in lieu of having the license suspended for all or part of the suspension period. Upon the receipt of the petition, the state commission or local licensing authority may, in its sole discretion, stay the proposed suspension and cause any investigation to be made which it deems desirable and may, in its sole discretion, grant the petition if the state commission or local licensing authority is satisfied that: (4) Upon payment of the fine pursuant to subsection (3) of this section, the state commission or local licensing authority shall enter its further order permanently staying the imposition of the suspension. If the fine is paid to a local licensing authority, the governing body of the authority shall cause the moneys to be paid into the general fund of the local licensing authority. Fines paid to the state licensing authority pursuant to subsection (3) of this section shall be transmitted to the state treasurer, who shall credit the same to the medical marijuana license cash fund created in section 12-43.3-501. (5) In connection with a petition pursuant to subsection (3) of this section, the authority of the state commission or local licensing authority is limited to the granting of such stays as are necessary for the authority to complete its investigation and make its findings and, if the commission or local licensing authority makes such findings, to the granting of an order permanently staying the imposition of the entire suspension or that portion of the suspension not otherwise conditionally stayed. (6) If the state commission or local licensing authority does not make the findings required in paragraph (a) of subsection (3) of this section and does not order the suspension permanently stayed, the suspension shall go into effect on the operative date finally set by the state or local licensing authority. SECTION 27. In Colorado Revised Statutes, 12-43.3-602, amend (4), (5), (6), and (7) as follows: 12-43.3-602. Disposition of unauthorized marijuana or marijuana-infused products and related materials. (4) If the state commission or local licensing authority issues a final agency order imposing a disciplinary action against a licensee pursuant to section 12-43.3-601, then, in addition to any other remedies, the commission or local licensing authority's final agency order may specify that some or all of the licensee's marijuana or marijuana-infused product is not medical marijuana or a medical marijuana-infused product and is an illegal controlled substance. The order may further specify that the licensee shall lose any interest in any of the marijuana or marijuana-infused product even if the marijuana or marijuana-infused product previously qualified as medical marijuana or a medical marijuana-infused product. The final agency order may direct the destruction of any such marijuana and marijuana-infused products, except as provided in subsections (5) and (6) of this section. The authorized destruction may include the incidental destruction of any containers, equipment, supplies, and other property associated with the marijuana or marijuana-infused product. (5) Following the issuance of a final agency order by the commission or local licensing authority imposing a disciplinary action against a licensee and ordering destruction authorized by subsection (4) of this section, a licensee shall have fifteen days within which to file a petition for stay of agency action with the district court. The action shall be filed in the city and county of Denver, which shall be deemed to be the residence of the state licensing authority commission for purposes of this section. The licensee shall serve the petition in accordance with the rules of civil procedure. The district court shall promptly rule upon the petition and shall determine whether the licensee has a substantial likelihood of success on judicial review so as to warrant delay of the destruction authorized by subsection (4) of this section or whether other circumstances, including but not limited to the need for preservation of evidence, warrant delay of such destruction. If destruction is so delayed pursuant to judicial order, the court shall issue an order setting forth terms and conditions pursuant to which the licensee may maintain the marijuana and marijuana-infused product pending judicial review, and prohibiting the licensee from using or distributing the marijuana or marijuana-infused product pending the review. The commission or local licensing authority shall not carry out the destruction authorized by subsection (4) of this section until fifteen days have passed without the filing of a petition for stay of agency action, or until the court has issued an order denying stay of agency action pursuant to this subsection (5). (6) The commission or local licensing authority shall not carry out the destruction authorized by subsection (4) of this section until it has notified the district attorney for the judicial district in which the marijuana is located to determine whether the marijuana or product constitutes evidence in a criminal proceeding such that it should not be destroyed, and until fifteen days have passed from the date of the issuance of such notice. (7) On or before January 1, 2012, the state licensing authority commission shall promulgate rules governing the implementation of this section. SECTION 28. In Colorado Revised Statutes, 12-43.3-701, amend (1) and (2) as follows: 12-43.3-701. Inspection procedures. (1) Each licensee shall keep a complete set of all records necessary to show fully the business transactions of the licensee, all of which shall be open at all times during business hours for the inspection and examination of the commission or state licensing authority or its duly authorized representatives. The commission or state licensing authority may require any licensee to furnish such information as it considers necessary for the proper administration of this article and may require an audit to be made of the books of account and records on such occasions as it may consider necessary by an auditor to be selected by the commission or state licensing authority who shall likewise have access to all books and records of the licensee, and the expense thereof shall be paid by the licensee. (2) The licensed premises, including any places of storage where medical marijuana is grown, stored, cultivated, sold, or dispensed, shall be subject to inspection by the commission or state or local licensing authorities and their investigators, during all business hours and other times of apparent activity, for the purpose of inspection or investigation. For examination of any inventory or books and records required to be kept by the licensees, access shall be required during business hours. Where any part of the licensed premises consists of a locked area, upon demand to the licensee, such area shall be made available for inspection without delay, and, upon request by authorized representatives of the state or local licensing authority, the licensee shall open the area for inspection. SECTION 29. In Colorado Revised Statutes, amend 12-43.3-801 as follows: 12-43.3-801. Judicial review. Decisions by the state licensing authority commission or a local licensing authority shall be subject to judicial review pursuant to section 24-4-106, C.R.S. SECTION 30. In Colorado Revised Statutes, 12-43.3-1101, amend (1), (2.5), and (3) as follows: 12-43.3-1101. Responsible vendor program - standards - designation - program. (1) A person who wants to offer a responsible medical or retail marijuana vendor server and seller training program must submit an application to the state licensing authority commission for approval, which program is referred to in this part 11 as an "approved training program". The state licensing authority commission, in consultation with the department of public health and environment, shall approve the submitted program if the submitted program meets the minimum criteria described in subsection (2) of this section. The department of public health and environment shall review each submitted program and shall provide the state licensing authority commission with the department's analysis of whether the portions of the program related to the department's oversight meet the minimum criteria described in this section. (2.5) When promulgating program standards pursuant to subsection (2) of this section, the state licensing authority commission shall consider input from other state agencies, local jurisdictions, the medical and retail marijuana industry, and any other state or national seller server program. (3) A provider of an approved training program shall maintain its training records at its principal place of business during the applicable year and for the preceding three years, and the provider shall make the records available for inspection by the commission or local licensing authority during normal business hours. SECTION 31. In Colorado Revised Statutes, 12-43.3-1102, amend (1) (a) and (3) as follows: 12-43.3-1102. Responsible vendor - designation. (1) (a) A medical marijuana business licensed pursuant to this article or a retail marijuana business licensed pursuant to article 43.4 of this title may receive a responsible vendor designation from the program vendor after successfully completing a responsible medical or retail marijuana vendor server and seller training program approved by the state licensing authority commission. A responsible vendor designation is valid for two years from the date of issuance. (3) If the commission or a local or state licensing authority initiates an administrative action against a licensee who has complied with the requirements of this section and has been designated a responsible vendor, the licensing authority shall consider the designation as a mitigating factor when imposing sanctions or penalties on the licensee. SECTION 32. In Colorado Revised Statutes, 12-43.4-103, amend (1), (12), (14), and (14.5); and add (1.5) as follows: 12-43.4-103. Definitions. As used in this article, unless the context otherwise requires: (1) "Executive director" means the executive director of the department of revenue. "Commission" means the Colorado marijuana control commission created in section 12-43.3-203. (1.5) "Executive director" means the executive director of the department of revenue. (12) "Owner" means any person having a beneficial interest, as defined by the state licensing authority commission, in a retail marijuana establishment. (14) "Premises" means a distinctly identified, as required by the state licensing authority commission, and definite location, which may include a building, a part of a building, a room, or any other definite contiguous area. (14.5) "Resealable" means that the package continues to function with effectiveness specifications, which shall be established by the state licensing authority commission similar to the federal "Poison Prevention Packaging Act of 1970", 15 U.S.C. sec. 1471 et seq., for the number of openings and closings customary for its size and contents, which shall be determined by the state licensing authority commission. SECTION 33. In Colorado Revised Statutes, 12-43.4-104, amend (2) (b) (I) and (6) (a) as follows: 12-43.4-104. Applicability - retail marijuana - repeal. (2) (b) (I) The state licensing authority commission shall act upon an application made pursuant to subsection (1) of this section no sooner than forty-five days and no later than ninety days after the date of the application. The state licensing authority commission shall process applications in the order in which complete applications are received by the state licensing authority. (6) On or before April 1, 2014, and on or before April 1 each year thereafter, the state licensing authority shall submit a report to the joint budget committee and the finance committees of the senate and house of representatives, or any successor committees, on: (a) The progress that the state licensing authority commission is making in processing licenses; SECTION 34. In Colorado Revised Statutes, amend 12-43.4-105 as follows: 12-43.4-105. Limited access areas. Subject to the provisions of section 12-43.4-701, a limited access area shall be a building, room, or other contiguous area upon the licensed premises where retail marijuana and retail marijuana products are cultivated, stored, weighed, packaged, or tested, under control of the licensee, with limited access to only those persons licensed by the state licensing authority commission. All areas of ingress or egress to limited access areas shall be clearly identified as such by a sign as designated by the state licensing authority. SECTION 35. In Colorado Revised Statutes, 12-43.4-303, amend (1) as follows: 12-43.4-303. Retail marijuana license bond. (1) Before the state licensing authority commission issues a state license to an applicant, the applicant shall procure and file with the state licensing authority evidence of a good and sufficient bond in the amount of five thousand dollars with corporate surety thereon duly licensed to do business with the state, approved as to form by the attorney general of the state, and conditioned that the applicant shall report and pay all sales and use taxes due to the state, or for which the state is the collector or collecting agent, in a timely manner, as provided in law. SECTION 36. In Colorado Revised Statutes, 12-43.4-304, amend (1) as follows: 12-43.4-304. State licensing authority - application and issuance procedures. (1) Applications for a state license under the provisions of this article must be made to the state licensing authority on forms prepared and furnished by the state licensing authority and must set forth such information as the state licensing authority may require to enable the state licensing authority commission to determine whether a state license should be granted. The information must include the name and address of the applicant and the names and addresses of the officers, directors, or managers. Each application must be verified by the oath or affirmation of such person or persons as the state licensing authority may prescribe. The state licensing authority commission may issue a state license to an applicant pursuant to this section upon completion of the applicable criminal history background check associated with the application, and the state license is conditioned upon local jurisdiction approval. A license applicant is prohibited from operating a licensed retail marijuana business without state and local jurisdiction approval. If the applicant does not receive local jurisdiction approval within one year from the date of state licensing authority commission approval, the state license shall expire and may not be renewed. If an application is denied by the local licensing authority, the state licensing authority commission shall revoke the state-issued license. SECTION 37. In Colorado Revised Statutes, 12-43.4-305, amend (1) introductory portion and (2) as follows: 12-43.4-305. Denial of application - definition. (1) The state licensing authority commission shall deny a state license if the premises on which the applicant proposes to conduct its business does not meet the requirements of this article or for reasons set forth in section 12-43.4-304. The state licensing authority commission may refuse or deny a license renewal, reinstatement, or initial license issuance for good cause. For purposes of this subsection (1), "good cause" means: (2) If the state licensing authority commission denies a state license pursuant to subsection (1) of this section, the applicant shall be entitled to a hearing pursuant to section 24-4-104 (9), C.R.S., and judicial review pursuant to section 24-4-106, C.R.S. The state licensing authority commission shall provide written notice of the grounds for denial of the state license to the applicant and to the local jurisdiction at least fifteen days prior to the hearing. SECTION 38. In Colorado Revised Statutes, 12-43.4-306, amend (1) (d), (1) (g) (II), and (1) (i) as follows: 12-43.4-306. Persons prohibited as licensees - definitions. (1) A license provided by this article shall not be issued to or held by: (d) A person financed in whole or in part by any other person whose criminal history indicates he or she is not of good moral character after considering the factors in section 24-5-101 (2), C.R.S., and reputation satisfactory to the respective commission or licensing authority; (g) A person who: (II) Has discharged a sentence for a conviction of a felony pursuant to any state or federal law regarding the possession, distribution, manufacturing, cultivation, or use of a controlled substance in the ten years immediately preceding his or her application date or five years from May 28, 2013, whichever is longer; except that the commission or local licensing authority may grant a license to a person if the person has a state felony conviction based on possession or use of marijuana or marijuana concentrate that would not be a felony if the person were convicted of the offense on the date he or she applied for licensure; (i) A sheriff, deputy sheriff, police officer, or prosecuting officer, or an officer or employee of the commission, state licensing authority, or a local licensing authority; SECTION 39. In Colorado Revised Statutes, 12-43.4-307, amend (1) introductory portion and (1) (a) as follows: 12-43.4-307. Restrictions for applications for new licenses. (1) The state licensing authority commission shall not approve an application for the issuance of a state license pursuant to this article: (a) If the application for the license concerns a particular location that is the same as or within one thousand feet of a location for which, within the two years immediately preceding the date of the application, the state licensing authority commission denied an application for the same class of license due to the nature of the use or other concern related to the location; or SECTION 40. In Colorado Revised Statutes, 12-43.4-308, amend (2) as follows: 12-43.4-308. Transfer of ownership. (2) For a transfer of ownership, a license holder shall apply to the state licensing authority on forms prepared and furnished by the state licensing authority commission. Upon receipt of an application for transfer of ownership, the state licensing authority commission shall submit, within seven days, a copy of the application to the local jurisdiction to determine whether the transfer complies with local restrictions on transfer of ownership. In determining whether to permit a transfer of ownership, the state licensing authority commission shall consider only the requirements of this article, any rules promulgated by the state licensing authority commission, and any other local restrictions. The local jurisdiction may hold a hearing on the application for transfer of ownership. The local jurisdiction shall not hold a hearing pursuant to this subsection (2) until the local jurisdiction has posted a notice of hearing in the manner described in section 12-43.4-302 (1) on the licensed premises for a period of ten days and has provided notice of the hearing to the applicant at least ten days prior to the hearing. Any transfer of ownership hearing by the state licensing authority commission shall be held in compliance with the requirements specified in section 12-43.4-304. SECTION 41. In Colorado Revised Statutes, 12-43.4-309, amend (2), (3), and (6) as follows: 12-43.4-309. Licensing in general. (2) A retail marijuana establishment may not operate until it is licensed by the state licensing authority commission pursuant to this article and approved by the local jurisdiction. If an application is denied by the local licensing authority, the state licensing authority commission shall revoke the state-issued license. In connection with a license, the applicant shall provide a complete and accurate application as required by the state licensing authority. (3) A retail marijuana establishment shall notify the state licensing authority in writing of the name, address, and date of birth of an owner, officer, or manager before the new owner, officer, or manager begins managing, owning, or associating with the operation. The owner, officer, manager, or employee must pass a fingerprint-based criminal history record check as required by the state licensing authority commission and obtain the required identification prior to being associated with, managing, owning, or working at the operation. (6) Before granting a state license, the state licensing authority commission may consider, except when this article specifically provides otherwise, the requirements of this article and any rules promulgated pursuant to this article, and all other reasonable restrictions that are or may be placed upon the licensee by the licensing authority. SECTION 42. In Colorado Revised Statutes, amend 12-43.4-310 as follows: 12-43.4-310. License renewal. (1) Ninety days prior to the expiration date of an existing license, the state licensing authority shall notify the licensee of the expiration date by first-class mail at the licensee's address of record with the state licensing authority. A licensee may apply for the renewal of an existing license to the state licensing authority not less than thirty days prior to the date of expiration. Upon receipt of an application for renewal of an existing license and any applicable fees, the state licensing authority shall submit, within seven days, a copy of the application to the local jurisdiction to determine whether the application complies with all local restrictions on renewal of licenses. The state licensing authority shall not accept an application for renewal of a license after the date of expiration, except as provided in subsection (2) of this section. The state licensing authority commission may extend the expiration date of the license and accept a late application for renewal of a license if the applicant has filed a timely renewal application with the local licensing authority. The state commission or the local licensing authority, in its discretion, subject to the requirements of this subsection (1) and subsection (2) of this section and based upon reasonable grounds, may waive the thirty-day time requirements set forth in this subsection (1). (2) (a) Notwithstanding the provisions of subsection (1) of this section, a licensee whose license has been expired for not more than ninety days may file a late renewal application upon the payment of a nonrefundable late application fee of five hundred dollars to the state licensing authority. A licensee who files a late renewal application and pays the requisite fees may continue to operate until the state licensing authority commission takes final action to approve or deny the licensee's late renewal application unless the state licensing authority commission summarily suspends the license pursuant to article 4 of title 24, C.R.S., this article, and rules promulgated pursuant to this article. (b) The state licensing authority commission may administratively continue the license and accept a later application for renewal of a license at the discretion of the state licensing authority commission. (c) Notwithstanding the amount specified for the late application fee in paragraph (a) of this subsection (2), the state licensing authority commission by rule or as otherwise provided by law may reduce the amount of the fee if necessary pursuant to section 24-75-402 (3), C.R.S., by reducing the uncommitted reserves of the fund to which all or any portion of the fee is credited. After the uncommitted reserves of the fund are sufficiently reduced, the state licensing authority commission, by rule or as otherwise provided by law, may increase the amount of the fee as provided in section 24-75-402 (4), C.R.S. SECTION 43. In Colorado Revised Statutes, amend 12-43.4-311 as follows: 12-43.4-311. Inactive licenses. The state licensing authority commission, in its discretion, may revoke or elect not to renew any license if it determines that the licensed premises have been inactive, without good cause, for at least one year. SECTION 44. In Colorado Revised Statutes, 12-43.4-312, amend (1) as follows: 12-43.4-312. Unlawful financial assistance. (1) The state licensing authority commission shall require a complete disclosure of all persons having a direct or indirect financial interest, and the extent of such interest, in each license issued under this article. SECTION 45. In Colorado Revised Statutes, 12-43.4-401, amend (1) introductory portion, (1) (e), and (2) (b) (II) as follows: 12-43.4-401. Classes of licenses. (1) For the purpose of regulating the cultivation, manufacture, distribution, sale, and testing of retail marijuana and retail marijuana products, the state licensing authority commission in its discretion, upon receipt of an application in the prescribed form, may issue and grant to the applicant a license from any of the following classes, subject to the provisions and restrictions provided by this article: (e) Occupational licenses and registrations for owners, managers, operators, employees, contractors, and other support staff employed by, working in, or having access to restricted areas of the licensed premises, as determined by the state licensing authority commission. The state licensing authority commission may take any action with respect to a registration pursuant to this article as it may with respect to a license pursuant to this article, in accordance with the procedures established pursuant to this article. (2) (b) (II) For a dual medical marijuana center and a retail marijuana store that only sells medical marijuana to persons twenty-one years of age or older, the state licensing authority must commission shall adopt rules concerning the licensed premises including but not limited to whether to allow single entrances and exits and virtual separation of inventory. SECTION 46. In Colorado Revised Statutes, 12-43.4-402, amend (2) (a), (3) (a) (III), (4), (5), and (8) as follows: 12-43.4-402. Retail marijuana store license - definitions. (2) (a) Notwithstanding the provisions of this section, a retail marijuana store licensee may also sell retail marijuana products that are prepackaged and labeled as required by rules of the state licensing authority commission pursuant to section 12-43.4-202 section 12-43.4-203. (3) (a) (III) As used in this paragraph (a), "equivalent in retail marijuana products" has the same meaning as established by the state licensing authority commission by rule pursuant to section 12-43.4-202 (3) (a.5). (4) A retail marijuana store may provide, except as required by section 12-43.4-202 (3) (a) (IV) section 12-43.4-203 (2) (a) (IV), a sample of its products to a facility that has a marijuana testing facility license from the state licensing authority commission for testing and research purposes. A retail marijuana store shall maintain a record of what was provided to the testing facility, the identity of the testing facility, and the results of the testing. (5) All retail marijuana and retail marijuana products sold at a licensed retail marijuana store shall be packaged and labeled as required by rules of the state licensing authority commission pursuant to section 12-43.4-202 section 12-43.3-203. (8) The premises of a licensed retail marijuana store is the only place where an automatic dispensing machine that contains retail marijuana or retail marijuana products may be located. If a licensed retail marijuana store uses an automatic dispensing machine that contains retail marijuana and retail marijuana products, it must comply with the regulations promulgated by the state licensing authority commission for its use. SECTION 47. In Colorado Revised Statutes, 12-43.4-403, amend (3) and (5) as follows: 12-43.4-403. Retail marijuana cultivation facility license. (3) A retail marijuana cultivation facility shall remit any applicable excise tax due in accordance with article 28.8 of title 39, C.R.S., based on the average wholesale prices set by the state licensing authority commission. (5) A retail marijuana cultivation facility may provide, except as required by section 12-43.4-202 (3) (a) (IV) section 12-43.4-203 (2) (a) (IV), a sample of its products to a facility that has a marijuana testing facility license from the state licensing authority commission for testing and research purposes. A retail marijuana cultivation facility shall maintain a record of what was provided to the testing facility, the identity of the testing facility, and the testing results. SECTION 48. In Colorado Revised Statutes, 12-43.4-404, amend (2), (3), (6), and (8) as follows: 12-43.4-404. Retail marijuana products manufacturing license. (2) Retail marijuana products shall be prepared on a licensed premises that is used exclusively for the manufacture and preparation of retail marijuana or retail marijuana products and using equipment that is used exclusively for the manufacture and preparation of retail marijuana products; except that, if permitted by the local jurisdiction, a retail marijuana products manufacturing licensee may share the same premises as a medical marijuana-infused products manufacturing licensee so long as a virtual or physical separation of inventory is maintained pursuant to rule of the state licensing authority commission. (3) All licensed premises on which retail marijuana products are manufactured shall meet the sanitary standards for retail marijuana product preparation promulgated pursuant to section 12-43.4-202 (3) (a) (XI) section 12-43.4-203 (2) (a) (XI). (6) A retail marijuana products manufacturer may provide, except as required by section 12-43.4-202 (3) (a) (IV) section 12-43.4-203 (2) (a) (IV), a sample of its products to a facility that has a retail marijuana testing facility license from the state licensing authority commission for testing and research purposes. A retail marijuana products manufacturer shall maintain a record of what was provided to the testing facility, the identity of the testing facility, and the results of the testing. (8) A licensed retail marijuana products manufacturer shall package and label each product manufactured as required by rules of the state licensing authority commission pursuant to section 12-43.4-202 section 12-43.4-203. SECTION 49. In Colorado Revised Statutes, 12-43.4-405, amend (2) and (3) as follows: 12-43.4-405. Retail marijuana testing facility license - rules. (2) The state licensing authority commission shall promulgate rules pursuant to its authority in section 12-43.4-202 (1) (b) section 12-43.4-203 (2) (a) related to acceptable testing and research practices, including but not limited to testing, standards, quality control analysis, equipment certification and calibration, and chemical identification and other substances used in bona fide research methods. (3) A person who has an interest in a retail marijuana testing facility license from the state licensing authority commission for testing purposes shall not have any interest in a licensed medical marijuana center, a licensed optional premises cultivation operation, a licensed medical marijuana-infused products manufacturer, a licensed retail marijuana store, a licensed retail marijuana cultivation facility, or a licensed retail marijuana products manufacturer. A person that has an interest in a licensed medical marijuana center, a licensed optional premises cultivation operation, a licensed medical marijuana-infused products manufacturer, a licensed retail marijuana store, a licensed retail marijuana cultivation facility, or a licensed retail marijuana products manufacturer shall not have an interest in a facility that has a retail marijuana testing facility license. SECTION 50. In Colorado Revised Statutes, 12-43.4-601, amend (1), (2), (3) (a) introductory portion, (4), (5), (6), and (7) as follows: 12-43.4-601. Suspension - revocation - fines. (1) In addition to any other sanctions prescribed by this article or rules promulgated pursuant to this article, the state licensing authority commission has the power, on its own motion or on complaint, after investigation and opportunity for a public hearing at which the licensee must be afforded an opportunity to be heard, to fine a licensee or to suspend or revoke a license issued by the authority commission for a violation by the licensee or by any of the agents or employees of the licensee of the provisions of this article, or any of the rules promulgated pursuant to this article, or of any of the terms, conditions, or provisions of the license issued by the state licensing authority commission. The state licensing authority commission has the power to administer oaths and issue subpoenas to require the presence of persons and the production of papers, books, and records necessary to the determination of a hearing that the state authority is authorized to conduct. (2) The state licensing authority commission shall provide notice of suspension, revocation, fine, or other sanction, as well as the required notice of the hearing pursuant to subsection (1) of this section, by mailing the same in writing to the licensee at the address contained in the license and, if different, at the last address furnished to the authority by the licensee. Except in the case of a summary suspension, a suspension shall not be for a period longer than six months. If a license is suspended or revoked, a part of the fees paid therefor shall not be returned to the licensee. Any license may be summarily suspended by the state licensing authority commission without notice pending any prosecution, investigation, or public hearing pursuant to the terms of section 24-4-104 (4), C.R.S. Nothing in this section shall prevent the summary suspension of a license pursuant to section 24-4-104 (4), C.R.S. (3) (a) Whenever a decision of the state licensing authority commission suspending a license for fourteen days or less becomes final, the licensee may, before the operative date of the suspension, petition for permission to pay a fine in lieu of having the license suspended for all or part of the suspension period. Upon the receipt of the petition, the state authority commission may, in its sole discretion, stay the proposed suspension and cause any investigation to be made which it deems desirable and may, in its sole discretion, grant the petition if the state licensing authority commission is satisfied that: (4) Upon payment of the fine pursuant to subsection (3) of this section, the state licensing authority commission shall enter its further order permanently staying the imposition of the suspension. Fines paid to the state licensing authority pursuant to subsection (3) of this section shall be transmitted to the state treasurer, who shall credit the same to the marijuana cash fund created in section 12-43.3-501. (5) In connection with a petition pursuant to subsection (3) of this section, the authority of the state licensing authority commission is limited to the granting of such stays as are necessary for the authority commission to complete its investigation and make its findings and, if the authority commission makes such findings, to the granting of an order permanently staying the imposition of the entire suspension or that portion of the suspension not otherwise conditionally stayed. (6) If the state licensing authority commission does not make the findings required in paragraph (a) of subsection (3) of this section and does not order the suspension permanently stayed, the suspension shall go into effect on the operative date finally set by the state licensing authority commission. (7) No later than January 15 of each year, the state licensing authority commission shall compile a report of the preceding year's actions in which fines, suspensions, or revocations were imposed by the state licensing authority. The state licensing authority commission shall file one copy of the report with the chief clerk of the house of representatives, one copy with the secretary of the senate, and six copies in the joint legislative library. SECTION 51. In Colorado Revised Statutes, 12-43.4-602, amend (4), (5), (6), and (7) as follows: 12-43.4-602. Disposition of unauthorized marijuana or marijuana products and related materials - rules. (4) If the state licensing authority commission issues a final agency order imposing a disciplinary action against a licensee pursuant to section 12-43.4-601, then, in addition to any other remedies, the licensing authority's commission's final agency order may specify that some or all of the licensee's marijuana or marijuana product is not retail marijuana or a retail marijuana product and is an illegal controlled substance. The order may further specify that the licensee shall lose any interest in any of the marijuana or marijuana product even if the marijuana or marijuana product previously qualified as retail marijuana or a retail marijuana product. The final agency order may direct the destruction of any such marijuana and marijuana products, except as provided in subsections (5) and (6) of this section. The authorized destruction may include the incidental destruction of any containers, equipment, supplies, and other property associated with the marijuana or marijuana product. (5) Following the issuance of a final agency order by the state licensing authority commission against a licensee and ordering destruction authorized by subsection (4) of this section, a licensee shall have fifteen days within which to file a petition for stay of agency action with the district court. The action shall be filed in the city and county of Denver, which shall be deemed to be the residence of the state licensing authority commission for purposes of this section. The licensee shall serve the petition in accordance with the Colorado rules of civil procedure. The district court shall promptly rule upon the petition and determine whether the licensee has a substantial likelihood of success on judicial review so as to warrant delay of the destruction authorized by subsection (4) of this section or whether other circumstances, including but not limited to the need for preservation of evidence, warrant delay of such destruction. If destruction is so delayed pursuant to judicial order, the court shall issue an order setting forth terms and conditions pursuant to which the licensee may maintain the retail marijuana and retail marijuana product pending judicial review and prohibiting the licensee from using or distributing the retail marijuana or retail marijuana product pending the review. The licensing authority commission shall not carry out the destruction authorized by subsection (4) of this section until fifteen days have passed without the filing of a petition for stay of agency action or until the court has issued an order denying stay of agency action pursuant to this subsection (5). (6) A district attorney shall notify the state licensing authority commission if it begins investigating a retail marijuana establishment. If the state licensing authority commission has received notification from a district attorney that an investigation is being conducted, the state licensing authority commission shall not destroy any marijuana or marijuana products from the retail marijuana establishment until the destruction is approved by the district attorney. (7) On or before January 1, 2014, the state licensing authority commission shall promulgate rules governing the implementation of this section. SECTION 52. In Colorado Revised Statutes, 12-43.4-701, amend (1) as follows: 12-43.4-701. Inspection procedures. (1) Each licensee shall keep a complete set of all records necessary to show fully the business transactions of the licensee, all of which shall be open at all times during business hours for the inspection and examination by the commission or state licensing authority or its duly authorized representatives. The commission or state licensing authority may require any licensee to furnish such information as it considers necessary for the proper administration of this article and may require an audit to be made of the books of account and records on such occasions as it may consider necessary by an auditor to be selected by the commission or state licensing authority who shall likewise have access to all books and records of the licensee, and the expense thereof shall be paid by the licensee. SECTION 53. In Colorado Revised Statutes, amend 12-43.4-801 as follows: 12-43.4-801. Judicial review. Decisions by the state licensing authority commission are subject to judicial review pursuant to section 24-4-106, C.R.S. SECTION 54. In Colorado Revised Statutes, 12-43.4-901, amend (5) (a) as follows: 12-43.4-901. Unlawful acts - exceptions - repeal. (5) (a) Notwithstanding the provisions of part 2 of article 14 of title 25, C.R.S., no person shall form a business or nonprofit, including but not limited to a sole proprietorship, corporation, or other business enterprise, with the purpose or intent, in whole or in part, of transporting, cultivating, processing, transferring, or distributing marijuana or marijuana products without prior approval of the state licensing authority commission and the local jurisdiction. SECTION 55. Effective date. Sections 1 and 2 and 4 through 54 of this act take effect on July 1, 2016. SECTION 56. Safety clause. The general assembly hereby finds, determines, and declares that this act is necessary for the immediate preservation of the public peace, health, and safety.