HOUSE 3rd Reading Unamended April 25, 2016 HOUSE Amended 2nd Reading April 22, 2016Second Regular Session Seventieth General Assembly STATE OF COLORADO REENGROSSED This Version Includes All Amendments Adopted in the House of Introduction LLS NO. 16-0512.01 Thomas Morris x4218 HOUSE BILL 16-1079 HOUSE SPONSORSHIP Becker K. and Singer, SENATE SPONSORSHIP Steadman, House Committees Senate Committees Public Health Care & Human Services Finance Appropriations A BILL FOR AN ACT Concerning a certification program for cannabis that is pesticide-free, and, in connection therewith, making an appropriation. 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.) Because marijuana and hemp are illegal under federal law and federal law governs whether a product can be labeled or advertised as "organic", marijuana or hemp that is cultivated, processed, and sold in accordance with state law currently cannot be labeled or advertised as "organic". Section 3 of the bill directs the commissioner of agriculture to promulgate rules governing a program to enable consumers to easily identify medical and retail marijuana and industrial hemp that have been cultivated and processed without the use of pesticides. The department of agriculture will certify third parties who can certify whether the marijuana or hemp cultivated or processed at a particular cannabis facility is free of pesticides. Sections 1 and 2 allow marijuana product labels to include a standardized notification that the marijuana has been certified as being pesticide-free. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. In Colorado Revised Statutes, 12-43.3-202, amend (2) (a) (XIV) as follows: 12-43.3-202. Powers and duties of state licensing authority - rules. (2) (a) Rules promulgated pursuant to paragraph (b) of subsection (1) of this section may include, but need not be limited to, the following subjects: (XIV) Labeling standards, which must allow a standardized notification that the medical marijuana has been certified as organic pursuant to section 35-11.5-201, C.R.S.; SECTION 2. In Colorado Revised Statutes, 12-43.4-202, amend (3) (a) (IV) (B) and (3) (a) (VII) introductory portion as follows: 12-43.4-202. Powers and duties of state licensing authority - rules. (3) (a) Rules promulgated pursuant to paragraph (b) of subsection (2) of this section must include, but need not be limited to, the following subjects: (IV) (B) Testing shall must include, but is 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; except that a licensed premises that is certified as organic pursuant to part 2 of article 11.5 of title 35, C.R.S., is exempt from testing for pesticides. (VII) Labeling requirements for retail marijuana and retail marijuana products sold by a retail marijuana establishment that are at least as stringent as those imposed by section 25-4-1614 (3) (a), C.R.S. The labeling requirements must allow a standardized notification that the marijuana has been certified as organic pursuant to section 35-11.5-201, C.R.S., and must include but are not limited to: SECTION 3. In Colorado Revised Statutes, add part 2 to article 11.5 of title 35 as follows: PART 2 ORGANIC CANNABIS 35-11.5-201. Certification of organic cannabis. (1) The commissioner shall adopt a program to enable consumers to easily identify cannabis that is organic. (2) The department shall certify, according to the terms of the program, third-party certifiers of licensed premises, as that term is defined in sections 12-43.3-104 and 12-43.4-103, C.R.S., who can certify whether the cannabis at a particular premises is organic. (3) A person shall not, in connection with an organic certification pursuant to this part 2, use the organic seal established by the United States department of agriculture or imply any tacit or direct approval by or attribution to the federal organic certification program. 35-11.5-202. Definitions - program - rules. (1) For purposes of this part 2, unless the context otherwise requires: (a) "Cannabis" means "medical marijuana" as defined in section 12-43.3-104, C.R.S., and "retail marijuana" as defined in section 12-43.4-103, C.R.S. (b) "OMRI" means the Organic Materials Review Institute or an analogous successor organization as determined by the commissioner. (c) (I) "Organic" means, as further specified in rules promulgated pursuant to this section, that: (A) There are no biosolids present in potting soils or the land used for cultivation; and (B) The use of prohibited nonsynthetic substances complies with 7 CFR 205.602. (II) OMRI-approved nutrients and inputs are allowed in the cultivation and treatment of organic cannabis. (2) The program must: (I) Not accept applications for certification until the department has made its determination regarding the use of pesticides on cannabis pursuant to section 24-20-112 (1), C.R.S., and the state licensing authority has established the testing and certification program required by section 12-43.4-202 (3) (a) (IV) (A), C.R.S.; (II) Have the capacity to run independent verification of inputs not already reviewed by OMRI or the department; (III) Support indoor and outdoor cultivators; (IV) Require inspections each year of at least fifteen percent of the licensed premises that have been certified organic; (V) Specify that licensed premises that have been certified organic pursuant to this part 2 are not subject to testing for pesticides by the state licensing authority or any local entity; (VI) Include comprehensive documentation of pesticides and fertilizers used and inspection of the documentation both annually and when any changes are made; and (VII) Require the department to post a list of certifiers and licensed premises that are currently certified on its website. (3) The commissioner shall, after consulting with the state licensing authority specified in section 12-43.3-201 (1), C.R.S., adopt rules to implement this part 2. The rules must: (a) Specify the experience or credentials and the resources that a person must have, and the evidence that the person must submit, to be qualified as a certifier pursuant to this part 2, including a plan that the certifier will follow in issuing certifications; (b) Contain standards that certifiers must follow in certifying cannabis pursuant to this part 2; (c) Require each certifier to submit an annual report to the department that summarizes the certifier's activities in the previous calendar year along with other information specified in the rules; (d) Authorize the department to conduct a periodic or risk-based on-site audit of a certifier that includes the ability to accompany a certifier while the certifier visits a licensed premises or land area and while the certifier conducts the necessary analysis of the data collected during the visit; (e) Specify fees that the department may charge to certify a certifier, which fees must be set in an amount sufficient to recover the department's direct and indirect costs associated with implementing this part 2; and (f) Provide for the confidentiality of documents and information as specified in section 35-11.5-105 (4). 35-11.5-203. Funding. The department may seek, accept, and expend gifts, grants, or donations from private or public sources for the purposes of this part 2. The department shall transmit all money received pursuant to this part 2 to the state treasurer, who shall credit the money to the marijuana cash fund created in section 12-43.3-501 (1) (a), C.R.S. SECTION 4. In Colorado Revised Statutes, amend 35-11.5-101 as follows: 35-11.5-101. Short title. The short title of this article shall be known and may be cited as part 1 is the "Organic Certification Act". SECTION 5. In Colorado Revised Statutes, amend 35-11.5-102 as follows: 35-11.5-102. Legislative declaration. The general assembly declares that the purpose of this article part 1 is to provide a means for the general public to recognize and purchase organically grown agricultural products and to assist Colorado producers in the marketing of such products. The general assembly further declares that uniformity in labeling will protect both consumers and producers by providing assurance of compliance with recognized production standards. SECTION 6. In Colorado Revised Statutes, 35-11.5-105, amend (3) as follows: 35-11.5-105. Delegation of duties - inspections - cooperative agreements - confidentiality. (3) The department and the commissioner shall coordinate with the secretary to implement the state organic certification program pursuant to this article part 1. SECTION 7. In Colorado Revised Statutes, 35-11.5-113, amend (1) as follows: 35-11.5-113. Money credited to plant health, pest control, and environmental protection cash fund. (1) All fees and penalties collected pursuant to this article part 1 shall be transmitted to the state treasurer, who shall credit the same them to the plant health, pest control, and environmental protection cash fund created in section 35-1-106.3. Within sixty days after July 1, 2009, the unexpended and unencumbered balance of the organic certification fund, as that fund existed prior to July 1, 2009, shall be transferred to the plant health, pest control, and environmental protection cash fund. SECTION 8. In Colorado Revised Statutes, 35-11.5-114, amend (1) introductory portion as follows: 35-11.5-114. Advisory board. (1) Effective July 1, 2010, for the purpose of assisting the commissioner in formulating rules for carrying out the provisions of this article part 1, there is hereby created an organic certification advisory board, to be composed of twelve members appointed by the commissioner, as follows: Nine shall must represent certified organic operations; one shall must be a consumer representing the general public; one shall must be a representative from the Colorado cooperative extension service; and one shall must be a representative from the Colorado agricultural experiment station. The nine advisory board members representing certified organic operations shall must represent the following four categories of organic certification, in proportion to the number of organic operations certified in each category: SECTION 9. In Colorado Revised Statutes, amend 35-11.5-117 as follows: 35-11.5-117. Conflict with federal law. If the secretary or a court of competent jurisdiction determines that there is a conflict between this article part 1 and any provisions of the federal "Organic Foods Production Act of 1990", 7 U.S.C. sec. 6501 et seq. or 7 CFR part 205, the provisions of the federal act and rules shall control, and the commissioner shall perform the duties and discharge the obligations contained in the federal act. If such a determination is made, the commissioner shall submit a report to the general assembly explaining the conflict. SECTION 10. In Colorado Revised Statutes, 12-43.3-501, amend (1) (b) as follows: 12-43.3-501. Marijuana cash fund. (1) (b) Moneys Money in the fund are is subject to annual appropriation by the general assembly to: (I) The department of revenue for the direct and indirect costs associated with implementing this article, article 43.4 of this title, and article 28.8 of title 39, C.R.S.; and (II) The department of agriculture for the direct and indirect costs associated with implementing part 2 of article 11.5 of title 35, C.R.S. SECTION 11. Appropriation. (1) For the 2016-17 state fiscal year, $65,640 is appropriated to the department of agriculture. This appropriation is from the marijuana cash fund created in section 12-43.3- 501 (1) (a), C.R.S. To implement this act, the department may use this appropriation as follows: (a) $37,137 for the plant industry division, which amount is based on an assumption that the division will require an additional 0.5 FTE; and (b) $28,503 for the purchase of legal services. (2) For the 2016-17 state fiscal year, $28,503 is appropriated to the department of law. This appropriation is from reappropriated funds received from the department of agriculture under paragraph (b) of subsection (1) of this section and is based on an assumption that the department of law will require an additional 0.2 FTE. To implement this act, the department of law may use this appropriation to provide legal services for the department of agriculture. SECTION 12. Severability. Section 2-4-204, Colorado Revised Statutes, regarding severability, applies to this act. SECTION 10. Applicability. This act applies to conduct occurring on or after the effective date of this act. SECTION 11. 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.