of cannabis control...2018/07/19 · ben wu beverly yu members absent (3) kristin...
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OF
CANNABIS CONTROL CALIFORNIA
Cannabis Advisory Committee
Meeting Minutes – May 17, 2018
Hilton Oakland Airport, International Ballroom
1 Hegenberger Road, Oakland
Members Present (19):
Avis Bulbulyan (Arrived late)
Timmen Cermak
Matt Clifford
Bill Dombrowski
Jeff Ferro
Eric Hirata
Catherine Jacobson
Arnold Leff
Kristin Lynch
Kristin Nevedal
Joe Nicchitta
LaVonne Peck
Matt Rahn
Keith Stephenson
Tamar Todd
Helena Williams
David Woolsey
Ben Wu
Beverly Yu
Members Absent (3)
Kristin Heidelbach-Teramoto
Alice Huffman
James Sweeney
Department of Consumer Affairs
Dean R. Grafilo – Director, Department of Consumer Affairs
Bureau of Cannabis Control (Bureau) Executive Staff Present
Melanie V. Ramil – Deputy Bureau Chief
Tamara Colson – Assistant Chief Counsel
Andre Jones – Assistant Chief of External and Intergovernmental Affairs
Alex Traverso — Assistant Chief of Communications
1
Minutes Taken By
Ashlynn Blackshire, Legal Secretary, Bureau of Cannabis Control
1. Welcome, Call to Order, and Establishment of a Quorum (Matt Rahn, Chair,
Cannabis Advisory Committee)
Matt Rahn, Cannabis Advisory Committee (Committee) Chair, called the meeting to order.
Meeting official start time noted as 10:10 AM.
Roll was taken, 18 Committee members were present. Quorum was established.
Committee Comment: 0 Comments
Public Comment: 0 Comments
2. Welcome Remarks (Dean R. Grafilo, Director, Department of Consumer Affairs)
Director Grafilo thanked the Committee members for their service. Director Grafilo also
encouraged Committee members and the public to continue to provide their valuable feedback.
Committee Comment: 0 Comments
Public Comment: 0 Comments
3. Review and Approval of March 15, 2018 Cannabis Advisory Committee Meeting
Minutes
The Committee reviewed the March 15, 2018 draft minutes.
Committee Comment: 1 Comment
Committee Member Cermak motioned to the Committee to approve and adopt the March 15,
2018 draft minutes as presented. Committee Member Ferro seconded the motion.
Roll call vote was taken, the motion to approve and adopt the March 15, 2018 minutes passed on
a 16-0 vote, 2 committee members abstained.
Public Comment: 1 Comment
David Fluhart: Mr. Fluhart thanked the Committee for listening to the public’s voices and
taking what the public has to say into consideration. He appreciated that the minutes reflect the
point of view of everybody that was in attendance at the last meeting.
2
NAME YEA NAY ABSTAIN ABSENT RECUSAL
Avis Bulbulyan ✓ Timmen Cermak ✓ Matt Clifford ✓ Bill Dombrowski ✓ Jeff Ferro ✓ Kristin Heidelbach- ✓ Teramoto
Eric Hirata ✓ Alice Huffman ✓ Catherine Jacobson ✓ Arnold Leff ✓ Kristin Lynch ✓ Kristin Nevedal ✓ Joe Nicchitta ✓ LaVonne Peck ✓ Matt Rahn ✓ Keith Stephenson ✓ James Sweeney ✓ Tamar Todd ✓ Helena Williams ✓ David Woolsey ✓ Ben Wu ✓ Beverly Yu ✓
4. Discussion and Possible Action to Approve, Modify, or Reject the Subcommittee on
Licensing Application’s Recommendations (Beverly Yu, Chair, Subcommittee on
Licensing Applications)
Committee Member Yu presented the Licensing Application Subcommittee’s proposed
recommendations to the Committee.
Committee Comment: 6 Comments
Committee Member Cermak requested clarification on recommendations 2 and 3. Specifically,
what the two recommendations require over and above the temporary regulations as they stand.
Committee Member Yu stated that the recommendations would increase transparency in the
annual applications. Recommendation number 2 would require a corporation or entity to disclose
the names of the owners of the corporation or entity, not just name the corporation or entity itself
as the owner. Recommendation number 3 would require a corporation or entity that has a
3
financial interest to disclose the name, birth date, and provide a government-issued ID for all
individuals who are owners.
Committee Member Wu inquired whether the Bureau had estimates in terms of how much
additional time and cost it will take for the Bureau to validate labor standards.
Assistant Chief Counsel Colson responded that the Bureau does not have a specific number in
response to this recommendation.
Public Comment: 19 Comments
Susan Tibbon: Ms. Tibbon expressed concern regarding the potential corporatization of the State.
She stated that right now, there is no place for the small farmer. Microbusinesses are in no way
“micro” and the current legal framework would allow people like Steve DeAngelo to have 20
microbusinesses all over the state. She feels that there can be more done to make a space for legacy
farmers.
Dan Ghirjatis: Mr. Ghirjatis is an attorney for a retail dispensary operating in San Jose and
recommended that the Committee do nothing with the Subcommittee’s recommendations on licensing applications, as they will harm the market and are overkill. He stated there are already
California law and Department of Labor Industrial Standards in place; recommendations 1 and 2
will seriously hurt investment opportunities. If applicants must disclose people with minor shares
in the company, its going to make investment money go away, and the market is already suffering.
Dr. William Munjar: Dr. Munjar wanted clarification on how many employees a business must
have to be required to enter into a labor peace agreement. He stated that he finds it completely
acceptable under the law that anyone with a 20 percent or greater aggregate be required to disclose
information, but individuals at or under 19 percent are not required to.
Joshua Jenkins: Mr. Jenkins expressed concern regarding further regulation in the industry. He
talked about small farmers and “mom-and-pop” shops already trying to comply with existing regulations and stated that adding more regulations is going to push people back into the black
market. Mr. Jenkins stated that companies are being as transparent as possible, and that adding
more regulations is “placing the assumption and presumption of guilt on these companies.” He asked that the Committee take this into consideration and not pass Recommendations 1, 2, 3, and
5.
Sabrina Fendrick: Ms. Fendrick expressed her support for Recommendations 2 and 3 and stated
that if corporations are not required to disclose the names of the owners, this could potentially be
used as a loophole for companies to apply for a license through a shell company and no one would
know who is fiscally responsible. She stated that everyone needs to compete on an equal and
transparent playing field.
John Brower: Mr. Brower expressed support for all the recommendations on the floor and stated
the “transparency of ownership is vital.” He stated that small businesses and farmers need every advantage that is available, including the use of third-party consultants or preparers for their
applications. Mr. Brower also suggested that the July 1, 2018 deadline be kept regarding the
Bureau’s transition period and that Track-and-Trace and laboratory requirements be fully
implemented.
Unknown: The speaker stated that while transparency in ownership is needed, regarding social
equity, a disclosure of ownership would hurt equity people. The speaker also stated that
undocumented workers could be at risk if their status or any other information was disclosed. The
speaker reiterated the need for transparency, but expressed concern that more regulations will
4
make it harder for small businesses, people of color, and undocumented workers to enter the
market.
Tony Williams: Mr. Williams stated that he is currently in the process of waiting for a permit in
Pacifica, however the local jurisdiction is now trying to force him to close instead of allowing his
collective to operate under the “sunset clause,” which he says he is in full compliance with. He asked for clarification regarding the specifics of the sunset clause and if local jurisdictions can
force collectives to close.
Nick Hunto: Mr. Hunto expressed concern over obtaining authorization from local jurisdictions
to operate as cannabis businesses. He stated that on the local level, there are a lot of problems, and
it is very difficult. He said that if there was some way to take some control away from the local
jurisdictions so that more businesses could get a license, that would be preferable.
Ross Gordon: Mr. Gordon spoke on behalf of the California Growers Association (Association)
and stated that the Association largely represented, though not exclusively, cultivators. He
expressed support for Recommendations 2 and 3 and stated that they would ensure corporations
would not be able to hide behind shell companies. He stated that the Association’s feelings toward the recommendations were “overwhelmingly positive” and would not create additional disclosure requirements on smaller businesses.
Unknown: The speaker expressed strong support for Recommendation 1. The speaker stated that
they were a chemist who had worked in the industry and there are no labor standard regulations in
the California Occupational Safety and Health Administration (Cal/OSHA) or other workplace
standards to reference for cannabis businesses. The speaker suggested that a specific
recommendation be made that fume hoods be required to be installed in any business that partakes
in the formulation of vape pen cartridges.
Unknown: The speaker stated that for many individuals operating in the gray or black market,
employment opportunities with licensed businesses are going to be big opportunities. The speaker
also stated that it is important to note that there is some sort of benefit to licensed businesses hiring
people out of the gray and black market; doing so will be important to decreasing the size of these
gray and black markets over time.
Melanie Luthern: Ms. Luthern spoke on behalf of United Food and Commercial Workers
(UFCW) Western States Council (Council) and expressed both her personal and the Council’s strong support of Recommendation 1, particularly regarding compliance with labor standards and
reporting prior labor law violations. Ms. Luthern stated that Recommendation 1 is similar to the
other requirements already contained in the existing regulations, and is no more onerous than any
of the other requirements listed. She thanked the Committee for its effort of ensuring effective
regulations are in place.
Ray Pers: Mr. Pers expressed concern that there was nothing in the recommendations regarding
contract labor. He stated that labor is an expensive cost and suggested that something could be
added in the regulations for businesses that wanted to contract their employees or if someone could
find out if contracted employees will be allowed. Mr. Pers also suggested that something be placed
in the recommendation regarding preparers to ensure that the preparers do not assume
responsibility or liability for the application.
Vera Levett-Casey: Ms. Levett-Casey thanked the licensing Subcommittee for all its hard work
in addressing these recommendations. She requested that, for Recommendation 3 regarding
government-issued identification disclosures for all corporate owners, the requirement for the
personal and home addresses of the owners be used specifically by Bureau staff only and not posted
on any website. Ms. Levett-Casey stated that there have been quite a few people who have gotten
5
personal information off the Bureau’s website and she would like to make sure that does not
happen anymore.
Tim Morland: Mr. Morland recommended that the Committee not pass Recommendation 3 until
there was more clarification regarding disclosure requirements for companies that are publicly
traded or have many shareholders or stakeholders who have a financial interest in the company.
Nolan Marley: Mr. Marley expressed support for transparency in a company. He indicated that
the company he works for is publicly traded and the owners and shareholders should be disclosed.
He would like to see a clause added that states corporate officers, directors, board members who
control more than 20 percent of stock issued by the corporation must be disclosed as well. As for
publicly traded companies, he would like the Committee to be aware that financial interest could
shift very easily in an openly traded market and consider that for their recommendations as well.
Sam Nobel: Mr. Nobel expressed concern that Recommendations 2 and 3 may allow corporations
or limited liability corporations to be created outside of California in states that do not have
requirements for stating of information or a list of officers and then give licensing authorities in
California random identification. He also suggested that the Committee look at foreign
qualifications of corporations and corporations that are outside of California.
David Fluhart: Mr. Fluhart stated that recommendations the Committee will be voting on are
difficult decisions to make, either way. He expressed concern that the Committee will not be
successful in accomplishing what they want to do.
Additional Committee Comments: 27 Comments
Vice-Chair Todd requested clarification regarding the definition of ownership under the
regulations and if a corporation or entity owns 20 percent or more of a company, would they have
to disclose owner information.
Committee Member Yu commented that definition of “owner” under the regulations applies to any individual, corporation, or entity that owns 20 percent or more of a company.
Committee Member Lynch questioned, regarding labor standards, if the recommendations cover
contract labor as opposed to employees under California statute.
Committee Member Yu commented that the Subcommittee did not cover that in their hearing
and was not sure of the rules in terms of going back to Subcommittee to clarify.
Committee Member Wu inquired whether there is anything in the labor standards that explicitly
says that cannabis businesses are not subject to Cal/OSHA. He stated that Recommendation 1 may
create more bureaucracy and adds on to a list of things preventing people from getting started in
the industry. He asked whether Recommendations 1, 2, 3, and 6 could be voted on separately, or
whether they had to be voted on all at once.
Chair Rahn stated that the motion was to vote on all the recommendations at once.
Committee Member Peck asked if the motion could be amended to vote on the recommendations
individually.
Chair Rahn stated that the motion can be amended if the Committee wishes.
Committee Member Leff suggested the motion be amended so that Recommendations 1, 2, 3,
and 6 be voted on separately.
Committee Member Yu accepted Committee Member Leff’s amendment to her motion and
motioned to take up Recommendation 1 for a vote.
Committee Member Nicchitta seconded the motion.
6
Committee Member Ferro commented that a big part of legitimizing and stabilizing the industry
is to make sure the workers are protected and that businesses are complying with all labor standards
regardless of employee size.
Committee Member Cermak also commented that businesses need to make sure they are treating
their employees properly in terms of safeguarding their health.
Committee Member Jacobson inquired as to why the Committee was discussing specific labor
standards for businesses, if Cal/OSHA standards are already in place for any business that operates
in California.
Committee Member Yu responded that because the cannabis industry has functioned primarily
without any regulations, this recommendation would help set a standard and gives workers a peace
of mind knowing that businesses must follow labor standards.
Committee Member Jacobson questioned if it is common practice in any other industry for a
new business to disclose past labor law violations.
Chair Rahn responded that it depends on the local government and their licensing authority.
Committee Member Ferro commented that having some sort of requirement or
acknowledgement of labor standards from businesses during the application process would be
helpful in the inception of this industry.
Committee Member Jacobson responded that Cal/OSHA has held a meeting to specifically
address labor standard issues in the cannabis business and inquired if there had been any discussion
about working with Cal/OSHA so that businesses could reach out to Cal/OSHA regarding labor
law standards.
Committee Member Yu stated that there has not been any discussion about working with
Cal/OSHA since the last Subcommittee hearing. She agreed that workers should be in contact with
Cal/OSHA.
Committee Member Ferro also commented that the Committee is not just focused on labor
standards that are related to Cal/OSHA law but other labor standards, such as sexual harassment
in the workplace or wage and hour violations. He stated that there are already labor standards in
place that cover those issues as well.
Committee Member Dombrowski commented that the Committee may be unnecessarily
worrying about problems that have not been proven and that there are already a lot of regulations
in place with regards to labor standards.
Committee Member Woolsey also commented that he was concerned about the additional
resources that would be needed by the Bureau to enforce this recommendation, possibly extending
the application processing time.
Committee Member Lynch expressed support of Recommendation 1 and stated that this
additional requirement would be a good preventative measure for small businesses and entities to
ensure that they are in compliance and not in danger of losing their license.
Committee Member Cermak stated that the licensing forms already have a section dedicated to
acknowledging compliance with labor standards and expressed that if preparers and businesses
understood a plan was necessary, the time and effort put into complying would be small.
Chair Rahn commented that while it has been newly legalized, the industry is not brand new and
the standards of practice have already been around. Adding another responsibility for the Bureau
and another requirement for licensees is over burdensome and unnecessary.
Committee Member Bulbulyan commented that labor standards apply to two sides—health and
safety of the employees and wage and hour standards. Cal/OSHA has pretty much covered the
7
health and safety side, however, there needs to be more regulations and standards regarding wage
and hour labor standards.
Roll call vote was taken, the motion to adopt Licensing Application Subcommittee
Recommendation No. 1 failed on an 8-11 vote.
NAME YEA NAY ABSTAIN ABSENT RECUSAL
Avis Bulbulyan ✓ Timmen Cermak ✓ Matt Clifford ✓ Bill Dombrowski ✓ Jeff Ferro ✓ Kristin Heidelbach- ✓ Teramoto
Eric Hirata ✓ Alice Huffman ✓ Catherine Jacobson ✓ Arnold Leff ✓ Kristin Lynch ✓ Kristin Nevedal ✓ Joe Nicchitta ✓ LaVonne Peck ✓ Matt Rahn ✓ Keith Stephenson ✓ James Sweeney ✓ Tamar Todd ✓ Helena Williams ✓ David Woolsey ✓ Ben Wu ✓ Beverly Yu ✓
Committee Member Yu motioned the Committee to adopt Recommendation No. 2. Committee
Member Woolsey seconded the motion.
Committee Comment: 4 Comments
Committee Member Bulbulyan inquired whether disclosure of ownership will apply to public
corporations.
8
Committee Member Yu responded that it would, and if an applicant lists a corporation as an
owner, they would have to the disclose the owner or owners of that corporation.
Committee Member Bulbulyan responded and inquired if the definition of owner in the
recommendation is the same as the Bureau’s definition of owner described in their regulations.
Committee Member Yu stated that the definitions were the same.
Roll call vote was taken, the motion to adopt Licensing Application Subcommittee
Recommendation No. 2 passed on an 18-1 vote.
NAME YEA NAY ABSTAIN ABSENT RECUSAL
Avis Bulbulyan ✓ Timmen Cermak ✓ Matt Clifford ✓ Bill Dombrowski ✓ Jeff Ferro ✓ Kristin Heidelbach- ✓ Teramoto
Eric Hirata ✓ Alice Huffman ✓ Catherine Jacobson ✓ Arnold Leff ✓ Kristin Lynch ✓ Kristin Nevedal ✓ Joe Nicchitta ✓ LaVonne Peck ✓ Matt Rahn ✓ Keith Stephenson ✓ James Sweeney ✓ Tamar Todd ✓ Helena Williams ✓ David Woolsey ✓ Ben Wu ✓ Beverly Yu ✓
Committee Member Yu motioned the Committee to adopt Recommendation No. 3. Committee
Member Leff seconded the motion.
9
Committee Comments: 37 Comments
Committee Member Jacobson inquired whether the public comment regarding disclosure of
addresses and personal information was addressed in the recommendation.
Committee Member Yu responded that the application goes directly to the Bureau and none of
the information on it would be made public.
Asst. Chief Counsel Colson clarified that depending on the information that comes to the Bureau,
some of it is disclosable, while other information is not.
Committee Member Bulbulyan questioned if information on applications can be made exempt
from Freedom of Information Act (FOIA) requests.
Asst. Chief Counsel Colson responded that the Bureau is subject to both FOIA and the California
Public Records Act (CPRA) requests and the only way to make information exempt is to change
that specifically in both statutes.
Committee Member Jacobson inquired whether requiring applicants to disclose their state-issued
government ID will put individuals whose immigration status is unknown, at risk.
Committee Member Yu responded that theoretically that might be possible, but the
recommendation was mostly directed at corporations being identified as owners.
Committee Member Bulbulyan commented that disclosing owner(s) of a corporation may make
it harder for new investment money and capital to enter the market and may limit the funding for
social equity. It would be difficult to get public companies to list all owners and their information.
This requirement may deter corporations from entering the market, or find ways to circumvent the
regulations.
Committee Member Woolsey referred to a prior public comment and inquired whether
Recommendation No. 3 conflicts with Section 5004 of the Bureau’s emergency regulations, which
states that individuals who hold a share of stock that is less than 5 percent of the total shares of a
publicly traded company are excluded from being disclosed.
Asst. Chief Counsel Colson clarified that persons with up to 5 percent ownership in a publicly
traded company do not have to disclose under the current financial interest disclosures.
Committee Member Woolsey asked Asst. Chief Counsel Colson whether those persons with 5
percent or less ownership still be excluded from disclosures if the recommendation was to pass.
Asst. Chief Counsel Colson responded that those persons would still be excluded.
Committee Member Bulbulyan added that the definition of ownership in a publicly traded
company with aggregate shares of 5 percent or more would not apply to a private equity structure,
which is more of a limited partner/general partner structure.
Asst. Chief Counsel Colson clarified that as of right now, the regulations state that persons with
ownership up to 5 percent are exempt and that Recommendation No. 3 does not limit a percentage
of financial interest that would be excluded from disclosure.
Committee Member Nicchitta cited 26051.5 of the Business and Professions Code, which
requires a person that has a financial interest in a company to be disclosed in an application for
licensure, with some exemptions allowed. He asked whether a person is still required to disclose
under 26051.5 if that person has financial interest in a company that has financial interest in
another company.
Asst. Chief Counsel Colson responded that the statute requires anybody with a financial interest
to disclose.
Committee Member Nicchitta requested clarification regarding whether an applicant would need
to list the company as a “person” with financial interest if the recommendation passed as drafted.
10
Asst. Chief Counsel Colson responded that the company would indeed need to be listed as a
person.
Committee Member Yu clarified that Recommendation No. 3, if passed, would amend the
regulations about financial disclosures.
Committee Member Lynch clarified that the issues presented in public comment about
corporations using shell companies and coming into the market were addressed in Committee
Member Nicchitta’s comments.
Committee Member Yu stated that was the Subcommittee’s intent. Committee Member Bulbulyan questioned how Recommendation No. 3 will work in instances
of legacy trusts and family stock where there are multiple layers of disclosure.
Committee Member Yu responded that this is the first step in addressing the issue of transparency
and that there are more concerns that need to be addressed and discussed.
Committee Member Lynch asked if it would be possible to make and adopt a motion to table
Recommendation Nos. 2 and 3 for a future Committee or Subcommittee hearing.
Asst. Chief Counsel Colson responded that Recommendation No. 2 had already been voted on
and passed, but a motion could be made to revisit the recommendation at a future meeting. The
motion would be to review Recommendation No. 2 and table Recommendation No. 3 for a future
Committee meeting, because Chair Rahn has not extended the Subcommittees beyond the initial
sessions. However, a motion could be made to have more Subcommittee meetings if desired.
Committee Member Jacobson questioned what would be discussed if Recommendation No. 3
was tabled for a future Committee or Subcommittee meeting.
Committee Member Yu responded that the issues presented by Committee Member Bulbulyan
regarding financial disclosure of owners of family stock and legacy trusts.
Committee Member Jacobson responded and requested clarification regarding whether the issue
was that the Bureau needs to be aware of every entity in a business, including a family trust.
Committee Member Yu responded that the way Recommendation No. 3 is drafted states, “any corporation or other entity” and stated that this description would hopefully capture all business
structures.
Committee Member Jacobson questioned what the Subcommittee’s concerns are with the current regulations as they stand now and what issues they are trying to address with this recommendation.
Committee Member Yu responded that the concerns are that businesses with many financial
investors, who might just be corporations or other entities feeding money into a company, may
enter the market and the State may not be aware of who has ownership. This recommendation
would ensure that there is some transparency when businesses apply for licensure.
Committee Member Cermak questioned whether there would be any additional complications
to applying this recommendation to foreign corporations.
Asst. Chief Counsel Colson responded that under the Bureau’s current regulations, the obligations
to disclose a financial interest apply to everybody, and that Bureau staff could clarify language in
the regulations to make that clearer. Foreign corporations are not prohibited by the regulations, but
will still need to follow all owner and financial disclosure requirements.
Committee Member Jacobson questioned how the owner and financial disclosure requirements
would affect crowdsourcing or crowdfunding.
Asst. Chief Counsel Colson responded that the statute currently requires the disclosure of any
person with any financial interest that meets that threshold, with the few exceptions such as blind
trust or persons with up to 5 percent ownership in a publicly traded company. It was clarified that
11
there is no percentage requirement for financial disclosure. The 20 percent requirement applies to
the identification of owners in a business.
Chief Rahn commented that he agreed with Committee Member Bulbulyan that
Recommendation No. 3 could cause overregulation and stated that the Bureau’s regulations
already in place address the Subcommittee’s concerns. If, down the road, these issues are arising
or are still around, they can be dealt with then.
Roll call vote was taken, the motion to adopt Licensing Application Subcommittee
Recommendation No. 3 failed on an 6-12 vote.
NAME YEA NAY ABSTAIN ABSENT RECUSAL
Avis Bulbulyan ✓ Timmen Cermak ✓ Matt Clifford ✓ Bill Dombrowski ✓ Jeff Ferro ✓ Kristin Heidelbach- ✓ Teramoto
Eric Hirata ✓ Alice Huffman ✓ Catherine Jacobson ✓ Arnold Leff ✓ Kristin Lynch ✓ Kristin Nevedal ✓ Joe Nicchitta ✓ LaVonne Peck ✓ Matt Rahn ✓ Keith Stephenson ✓ James Sweeney ✓ Tamar Todd ✓ Helena Williams ✓ David Woolsey ✓ Ben Wu ✓ Beverly Yu ✓
Committee Member Yu motioned the Committee to adopt Recommendation No. 6. Committee
Member Leff seconded the motion.
12
Asst. Chief Counsel Colson requested clarification that Committee Member Yu motioned the
Committee to adopt Recommendation No. 6 and that Committee Member Leff understood that
was the motion he seconded.
Committee Member Yu responded that motion was to adopt Recommendation No. 6.
Committee Member Leff responded that he understood he seconded that motion.
Committee Comments: 0 Comments
Public Comments: 0 Comments
Roll call vote was taken, the motion to adopt Licensing Application Subcommittee
Recommendation No. 6 passed on an 19-0 vote.
NAME YEA NAY ABSTAIN ABSENT RECUSAL
Avis Bulbulyan ✓ Timmen Cermak ✓ Matt Clifford ✓ Bill Dombrowski ✓ Jeff Ferro ✓ Kristin Heidelbach- ✓ Teramoto
Eric Hirata ✓ Alice Huffman ✓ Catherine Jacobson ✓ Arnold Leff ✓ Kristin Lynch ✓ Kristin Nevedal ✓ Joe Nicchitta ✓ LaVonne Peck ✓ Matt Rahn ✓ Keith Stephenson ✓ James Sweeney ✓ Tamar Todd ✓ Helena Williams ✓ David Woolsey ✓ Ben Wu ✓ Beverly Yu ✓
13
Committee Member Yu motioned the Committee to adopt Recommendation No. 4 with the
amendment to include locally licensed equity applicants. Committee Member Ferro seconded
the motion.
Committee Comment: 1 Comment
Committee Member Nicchitta commented that if the Bureau and the other licensing agencies
review their annual license fees, they should look at allowing reduced or incentivized fees for
certain groups such as disabled-veteran-owned businesses, social-enterprise businesses, or
business that employ the formerly incarcerated or homeless.
Public Comment: 25 Comments
Susan Tibbon: Ms. Tibbon suggested that legacy farmers receive incentives and fees tied to gross
receipts. She expressed concern that rural farmers in Mendocino County are at 1 percent adoption
and that the licensing fees are too steep for the small farmers to pay, which is affecting the
communities.
Joshua Jenkins: Mr. Jenkins suggested that the issue of helping veterans obtain licensing be made
its own recommendation for the Committee to consider. He stated that there is already an equity
requirement for veterans in the state of California under Business and Professions Code 16102 that
is not being enforced.
Paul Hansberry: Mr. Hansberry agreed with Chair Rahn that the industry is not brand new, just
newly legalized, and has been around for a long time. He expressed concern that there should be
incentives for adoption. Currently, there are only barriers and the focus should be on small farmers
and businesses, not corporations.
Dr. William Munjar: Dr. Munjar stated that he is a retired military veteran and his application
was expedited. As a result, he received his temporary license. He disagreed with prior comments
stating that the licensing authorities are not helping veterans and thanked the Bureau for helping
him obtain a license. He expressed concern about the fees associated with hosting a cannabis event
and questioned whether any other event organizer in any other industry had to pay such high fees.
He also commented that corporations are not evil, and may help the industry in some cases.
Douglas Rio: Mr. Douglas spoke on behalf of the California Compassion Coalition (Coalition).
The Coalition suggested that the non-remuneration compassion cannabis activities or programs
donating 100 percent of the organization’s cannabis at no cost to qualified, at-risk communities,
should be fully exempt from all state taxes and licensing fees.
Ray Pers: Mr. Pers suggested that African Americans and people of color who have been
disproportionately disenfranchised by the war on drugs receive some priority in licensing or placed
into a separate equity program, because they have been affected the most. He also expressed
concern that licensing authorities are not reaching out to the African American communities.
Ryan Miller: Mr. Miller expressed support in reducing qualification requirements for disabled
veterans.
Ramon Garcia: Mr. Garcia stated that communities of color and equity applicants need
scholarships, fee waivers, payment plans, and reduced fees because it is already hard enough for
these communities to raise the capital needed to get started in the industry. He stated that small
farmers and small businesses paved the way for legalization and should not be shut out by big
corporations.
Unknown: The Speaker commented on the large amount of fees that are incurred at the local level,
even before applying for a state license.
14
Tim Morland: Mr. Morland stated that because licensees had to have a separate A and M license,
that meant separate fees, which becomes expensive very quickly. He suggested a tier system for
licensees who had multiple locations throughout the state. The primary location would have the
full annual fee and other “field” locations would have lower fees. Allen Steiner: Mr. Steiner suggested there be more discussion of helping individuals who have
cannabis-related arrests on their record and businesses that can prove they were operating under
Prop 215 enter the industry.
Ralph Trueblood: Mr. Trueblood stated that he and others who work with compassionate use
have saved taxpayers hundreds of millions of dollars over the last 20 years, and that no more
impediments are needed in the process to get licensed.
Sean Kiernan: Mr. Kiernan expressed support for more help to veterans trying to enter the
industry, and stated that this would be the best economic opportunity that veterans would have.
Christopher King: Mr. King stated that, as a retired veteran, he could get every single benefit he
was qualified for except the business license tax and fee exemption. He stated that there may be a
disconnect with the Disabled Veterans and Business Enterprise Program, which is a different
entity.
Unknown: The speaker expressed concern that the Committee has not touched on the mass
incarceration of people of color and the war on drugs when discussing levelling the playing field
of the cannabis industry. He recommended using the revenue generated from the industry to give
back to the disenfranchised communities.
Nolan Maury: Mr. Maury supported the recommendation to decrease fees for equity applicants
and eliminate the separate A and M licenses in favor of one license for both types. He
recommended waiting until there is more sales data for the first year, before assessing any fees.
Dale Sky Jones: Mr. Jones suggested that there should be a distinction between cannabis events
and educational events; the fees for these events should be adjusted accordingly.
Ron Leggett: Mr. Leggett also supported reducing fees for people of color and other equity
applicants to make it possible for these groups to enter the industry.
Charley Pappas: Mr. Pappas thanked the Committee for their work and stated that inclusion of
co-ops and collectives and businesses in the black market is needed to make the industry work.
Robert Wiener: Mr. Wiener stated that the annual fees are detrimental to small farmers and that
a lot of them are quitting the industry altogether because they cannot afford cultivation taxes and
license fees.
Adam Villareal: Mr. Villareal also supported reducing fees and added that Tier 3 applicants
should be included in the discussion because they are the ones trying to support partnerships and
sponsor social equity applicants. Accordingly, they should not have to pay such high fees.
Travis Wheatley: Mr. Wheatley cited section 16102 of the Business and Professions Code.
Bill Cooke: Mr. Cooke expressed support for reducing fees and costs for the smallest license types
and suggested larger license types could subsidize the smaller businesses.
Unknown: Speaker stated that the Committee will really need to push the social equity and
amnesty programs on the legislature so that small businesses, legacy farmers, and equity applicants
have a chance to enter the industry.
Unknown: The speaker suggested that instead of calling the program “social equity” rename it to “equity equity” to remove the stigma associated with it. He also expressed concern that groups who were incarcerated on drug charges are being left out of the conversation.
15
Additional Committee Comments: 9 Comments
Committee Member Lynch questioned whether Recommendation No. 4 also included reducing
fees for entities whose primary purpose is to serve disabled and military veterans.
Committee Member Yu responded that the Recommendation No. 4 states the following: “The licensing authorities should evaluate the amount of annual fees, especially fees paid by people with
disabilities, military veterans, and locally licensed equity applicants.” Committee Member Cermak suggested that the recommendation be amended to add nonprofit
compassion programs to the list.
Committee Member Yu accepted Committee Member Cermak’s amendment to her
recommendation. Committee Member Ferro seconded the amendment.
Committee Member Lynch repeated her earlier question, regarding whether the amended
recommendation includes entities whose primary purpose is compassionate use or to serve people
with disabilities or veterans.
Committee Member Yu responded that entities would be encompassed by the word “applicants” but asked if there should be more clarification.
Committee Member Lynch responded that the recommendation says, “paid by people” which
does not necessarily mean an entity and inquired about situations where the individual applicant
did not qualify, but the entity who is helping them does. Specifically, whether these entities would
be eligible for reduced fees under this recommendation.
Committee Member Yu suggested that the recommendation be amended for clarification and
should say: “The licensing authorities should evaluate the amount of annual fees, especially fees paid by applicants with disabilities, applicants who served in the military, and locally licensed
equity applicants” and include Committee Member Cermak’s amendment regarding nonprofit
compassion programs.
Asst. Chief Counsel Colson clarified that under the Medicinal and Adult Use Cannabis Safety
and Regulatory Act (MAUCRSA), a “person” also includes a corporation or LLC, so using
“people” in the recommendation already encompasses entities.
Roll call vote was taken, the motion to adopt Licensing Application Subcommittee amended
Recommendation No. 4 passed on an 19-0 vote.
NAME YEA NAY ABSTAIN ABSENT RECUSAL
Avis Bulbulyan ✓ Timmen Cermak ✓ Matt Clifford ✓ Bill Dombrowski ✓ Jeff Ferro ✓ Kristin Heidelbach- ✓ Teramoto
Eric Hirata ✓ Alice Huffman ✓ Catherine Jacobson ✓ Arnold Leff ✓
16
Kristin Lynch ✓ Kristin Nevedal ✓ Joe Nicchitta ✓ LaVonne Peck ✓ Matt Rahn ✓ Keith Stephenson ✓ James Sweeney ✓ Tamar Todd ✓ Helena Williams ✓ David Woolsey ✓ Ben Wu ✓ Beverly Yu ✓
Committee Member Yu motioned the Committee to adopt Recommendation No. 5. Committee
Member Dombrowski seconded the motion.
Committee Comment: 16 Comments
Committee Member Lynch questioned whether the Subcommittee discussed delaying testing
requirements for smaller entities, but requiring larger entities who have the capital to comply with
the July 1 deadline.
Committee Member Yu responded that the Subcommittee did not discuss any testing issues and
was more focused on the requirement that A and M licensees only conduct businesses with their
respective license types.
Asst. Chief Counsel Colson clarified that the transition period described in section 5029 of the
Bureau’s emergency regulations does not exactly state any phase-in testing requirements. The
phase-in testing requirements are in the testing laboratory section of the regulations.
Committee Member Bulbulyan inquired about the fees associated with A and M designations,
as all cannabis goods must be tested, regardless of the licensee’s designation. He also supported
delaying the transition period because the testing labs are not ready; the local governments are not
issuing licenses, which means the State cannot issue licenses.
Committee Member Stephenson commented that individuals do not have to get a county or state
issued medical marijuana card to purchase medicinal marijuana—they may bring a doctor’s recommendation.
Committee Member Cermak commented that the public health recommendation to not require
the state or county issued card was passed.
Committee Member Woolsey agreed that the transition period should be delayed, but questioned
how the Subcommittee came up with 18 months as the time of delay.
Committee Member Yu responded that the Subcommittee wanted to give the State more time to
evaluate everything. The Subcommittee also wanted to account for the lag in local government
action.
Committee Member Bulbulyan requested clarification as to whether the recommendation was to
extend the transition period until January 1, 2020, as opposed to January 1, 2019.
17
Committee Member Yu stated that the recommendation was to extend the transition period until
January 1, 2020.
Committee Member Bulbulyan suggested that the recommendation be amended to change the
extension to January 1, 2019, and commented that a six-month extension is a fair amount of time.
He indicated that he thought the recommended 18 months seemed a little excessive.
Committee Member Nevedal commented that merging the two license designations and fees
would be very beneficial and should be considered, in addition to extending the transition period.
Asst. Chief Counsel Colson requested clarification that the recommendation to extend the
transition period until January 1, 2020 did not apply to the recommendation to merge the license
designations and fees.
Committee Member Yu clarified that the January 1, 2020 date only applied to extending section
5029(b)(1) of the Bureau’s emergency regulations. The merging of A and M licenses and fees
would be implemented separately.
Committee Member Cermak commented that nurseries do not want to designate a crop as
recreational or medicinal until they see what is in demand. He questioned whether the Track-and-
Trace system will still be able to track product if it is no longer designated as A or M.
Asst. Chief Counsel Colson clarified that the Track-and-Trace system will be able to track all
product, regardless of designations present.
Public Comments: 22 Comments
Dorina Burn: Ms. Burn expressed concern that an additional six months would still not be enough
time to train everyone on all the requirements and regulations and supported extending the
transition period until January 1, 2020.
Ron Edwards: Mr. Edwards also supported extending the transition period until January 1, 2020.
Dr. William Munjar: Dr. Munjar questioned the assessing of annual fees and how these amounts
were generated.
Susan Tibbon: Ms. Tibbon expressed concern about being forced to destroy products that have
already been paid for. She suggested that the transition period be modified to read “until all
products are sold or destroyed by the dispensary at their discretion.” Paul Hansberry: Mr. Hansberry agreed with Ms. Tibbon’s comment. Retailers should be able to
recoup the monies that they paid for the products in their inventories.
Unknown: The speaker appeared on behalf of Hannah Nelson, a Mendocino-based attorney, who
was unable to come. Ms. Nelson’s statement was read to the Committee. Ms. Nelson’s statement indicated that extending the transition period would be helpful to farmers, however Track-and-
Trace does not have to be delayed.
Unknown: The speaker stated that since the A and M designation only comes into play for tax
purposes, product should not be designated as such until the point of sale at the retailer. The
speaker also supported extending the transition period until January 1, 2020.
Ross Gordon: Mr. Gordon expressed his support for Recommendation No. 5, and stated that the
prohibition of moving products between designations and having separate premises for each
designation make it hard to keep up with demand needs.
Allen Steiner: Mr. Steiner agreed with Mr. Gordon’s comments and added that it is important that there is a strong medicinal marijuana program.
Unknown: The speaker supported the recommendations to extend the transition period and merge
the license designations.
18
Sabrina Fendrick: Ms. Fendrick supported extending the transition period and merging the
license designations.
Valerie Corral: Ms. Corral supported extending the transition period and stated that the July 1
deadline is daunting because of all the large amounts of cannabis product that would have to be
destroyed if not sold by the deadline.
Unknown: The speaker also supported the recommendations to extend the transition period and
merge the license designations. The speaker then expressed concern that current medicinal product
that does not pass testing is destroyed instead of being used by compassionate use programs.
Joseph Evans: Mr. Evans supported extending the transition period and merging the license
designations. He stated that this would be helpful to testing labs because manufacturers of
laboratory equipment only want to sell their equipment if the product being tested is medicinal.
Max Mikalonis: Mr. Mikalonis expressed support for extending the transition period and
combining the license designations.
Alec Shedony: Mr. Shedony suggested that product not be marked A or M until it leaves the
distributor and goes to the actual point of sale and the customer.
Vera Levett-Casey: Ms. Levett-Casey also supported not designating product as A or M until the
point of sale and stated that 18 months gives enough time for voting cycles and statutory changes
to occur.
John Brower: Mr. Brower expressed support for extending the transition period and combining
the licensing designations and fees.
Unknown: Speaker supported combing the licensing designations and fees.
David Blaine: Mr. Blaine supported combining the A and M designations and license fees.
Andrew Jarvis: Mr. Jarvis supported extending the transition period an additional 18 months and
combing the license designations and fees.
David Fluhart: Mr. Fluhart stated that he supported extending the transition period only for an
additional 6 months as opposed to the recommended 18 months.
Additional Committee Comments: 5 Comments
Committee Member Cermak expressed support for extending the transition period, but
commented that combining the license designations might cause problems when dealing with the
Federal government. He suggested adjusting the cost of licenses but keeping the license
designations separate.
Committee Member Peck commented that the public brought up good points for extending the
transition period and combining the license designations and hopes the Committee takes the public
comments into consideration.
Committee Member Bulbulyan commented that the A and M designations have been a topic of
discussion in every single Subcommittee and stated that this affects the supply chain more than
anything else, which is why it is imperative that the designations be combined into one.
Committee Member Ferro requested clarification regarding whether the removal or merging of
the designations was a statutory change and if the combining of fees was allowed.
Asst. Chief Counsel Colson responded that the annual license fees could certainly be combined
and that statute does not get into specifics about whether A licensees can do business with M
licensees and M licensees can do business with A licensees.
19
Roll call vote was taken, the motion to adopt Licensing Application Subcommittee
Recommendation No. 5 passed on an 18-0 vote. Committee Member Stephenson stepped out of
the room and was not present to vote.
NAME YEA NAY ABSTAIN ABSENT RECUSAL
Avis Bulbulyan ✓ Timmen Cermak ✓ Matt Clifford ✓ Bill Dombrowski ✓ Jeff Ferro ✓ Kristin Heidelbach- ✓ Teramoto
Eric Hirata ✓ Alice Huffman ✓ Catherine Jacobson ✓ Arnold Leff ✓ Kristin Lynch ✓ Kristin Nevedal ✓ Joe Nicchitta ✓ LaVonne Peck ✓ Matt Rahn ✓ Keith Stephenson ✓ James Sweeney ✓ Tamar Todd ✓ Helena Williams ✓ David Woolsey ✓ Ben Wu ✓ Beverly Yu ✓
Chair Rahn called for a lunch break at 12:40 p.m. The Committee meeting was called back into
session at 1:30 p.m.
5. Discussion and Possible Action to Approve, Modify, or Reject the Subcommittee on
Manufacturers’ Recommendations (Jeff Ferro, Chair, Subcommittee on
Manufacturers)
Committee Member Ferro presented the Manufacturers Subcommittee’s proposed
recommendations to the Committee.
20
Committee Comments: 28 Comments
Committee Member Ferro motioned the Committee to adopt Recommendation Nos. 1, 2, 3 and
4 as drafted. Committee Member Leff seconded the motion.
Committee Member Cermak questioned if the typical dosage purchased for adult use was
known.
Committee Member Ferro responded that he was not sure and posed the question to other
Subcommittee members.
Committee Member Bulbulyan replied to Committee Member Cermak and stated that the
recommendations to increase dosage came from the thought process that the inactive ingredients
in topical products were more dangerous than the actual active ingredients of cannabis oil, so by
limiting dosage, public and consumer safety were not actually increased.
Committee Member Jacobson responded to Committee Member Bulbulyan’s comment and
questioned whether non-edible also meant inhalable or smokeable product.
Committee Member Bulbulyan answered that the definition is not statutory and that this
recommendation would cover topical lotions and vape cartridges, which would increase the
medicinal dosage to 4,000 and adult-use dosage to 2, 000 milligrams.
Christina Dempsey, California Department of Public Health (CDPH) clarified that non-
edible cannabis products include concentrates like vape cartridges and topical products and noted
there are several cannabis products that are non-edible.
Committee Member Jacobson responded to Christina Dempsey and asked if inhalable
products are already covered by statute.
Committee Member Ferro responded and said that was correct and that is why the
Subcommittee stated they were not covered by statute.
Christina Dempsey, CDPH requested clarification regarding which statute the Subcommittee
was referring to and explained that vape cartridges are considered a concentrate product which
falls into the non-edible category. If the Subcommittee is recommending raising the THC limits
in non-edibles, it would also apply to vape cartridges.
Vice-Chair Todd questioned whether there are limits in the statute as to the dosage and number
of doses for non-edible products.
Christina Dempsey, CDPH responded that the limit in the statute is for a serving size of edible
products.
Committee Member Jacobson requested clarification of the dosage in a vape cartridge.
Committee Member Bulbulyan clarified that the recommendation was to increase the dosage
for non-edible products only, which will not affect the dosage restrictions on edible products.
The recommendation would restrict the quantities of products but allow a higher dosage, which
can still be controlled.
Committee Member Hirata asked Christina Dempsey, CDPH if studies were done on other
states with legalized marijuana and their dosage limits.
Christina Dempsey, CDPH responded and said that CDPH did look at other states when setting
the limits and CDPH’s limits are consistent to limits that other states have imposed.
Committee Member Bulbulyan commented that most other states do not have dosage limits for
medicinal cannabis products, only adult-use products.
Vice-Chair Todd questioned whether the recommendation to raise dosage limits would apply to
both medicinal and adult-use cannabis products.
21
Committee Member Bulbulyan responded that the recommendation would raise the limit
dosage for medicinal non-edible products from 2,000 mg to 4,000 mg and adult-use non-edible
products from 1,000 mg to 2,000 mg.
Committee Member Nicchitta requested clarification as to whether the recommendation was
about raising the dosage limitations or raising the amount allowed in an individual package.
Committee Member Bulbulyan clarified that the recommendation would allow for non-edible
products such as lotions, vape cartridges, and tinctures to be increased in the amount of
concentration, so consumers do not have to buy multiple units of the same product to get the
same quantity.
Committee Member Nicchitta questioned if there is any existing dosage limit for non-edible
products in the regulations.
Committee Member Bulbulyan responded that the current regulations have a dosage limit of
1,000 mg and 2,000 mg.
Christina Dempsey, CDPH clarified that CDPH’s regulations do not set serving sizes or
“dosage” limits for non-edible products. Serving size restrictions are only set for edible products.
Non-edible products have a total package limit for THC contained.
Committee Member Nicchitta responded and questioned if the 1,000 mg and 2,000 mg limits
set for non-edibles was the total package limit. Christina Dempsey, CDPH responded that was
correct.
Committee Member Cermak questioned whether there is a limit to how much adult-use
product an individual can purchase and walk out of a retail store with.
Asst. Chief Counsel Colson responded that the Bureau has set limits to how much retailers can
sell to an individual each day, based on the Health and Safety Code’s requirements regarding possession of both medicinal and adult-use cannabis products. Committee Member Cermak
questioned what those amounts were. Committee Member Woolsey responded that it is 28 ½
grams of flower and 8 grams of concentrate for adult-use products.
Asst. Chief Counsel Colson added that for medicinal sales, if an individual had a physician’s
recommendation that stated a higher amount than what is allowed per the Health and Safety
Code, the Bureau has allowed retailers to sell the physician’s recommended amount to that
medical patient.
Public Comment: 17 Comments
Dr. Kevin Crowley: Dr. Crowley supported the recommendation to increase dosages for non-
edible products. He stated that non-edible cannabis products should be identified using
established pharmaceutical dosage forms as defined by the United States Pharmacopeia (USP).
Dr. William Munjar: Dr. Munjar expressed concern that the licensing authorities do not have
technology or resources to determine dosage.
Susan Tibbon: Ms. Tibbon suggested that there needs to be a mechanism to pre-approve and vet
labeling with clear, timely, corrected information.
Douglas Rio: Mr. Rio expressed support for raising the dosage limits in non-edible products and
suggested that donations provided through compassion programs be exempt from the dosage
limit requirements.
Dr. Lynn Silver: Dr. Silver commented that raising the limits on non-edible cannabis products is
unwise and imprudent and that regulators should seek to promote smaller levels of consumption,
less frequently, instead of increasing the amounts consumers can buy.
22
Unknown: The speaker commented that seeds and plants should not be required to be in child-
resistant packaging since there are no cannabinoids in them.
Michael: Michael commented that there needs to be more distinction between non-edible
products and more distinction between different molecules such as THC, THCA, Delta ATHC,
etcetera.
Unknown: The speaker stated that veterans usually have a regimen of 1,000 mgs, twice a day,
and the current dosage limits are adversely affecting them.
Ross Gordon: Mr. Gordon stated that there needs to be more clarification from CDPH regarding
packaging and labeling requirements.
Paul Hansberry: Mr. Hansberry expressed support for the recommendation, and stated that it
would help manufacturers cut down on packaging.
Unknown: The public speaker agreed with a prior comment that dosage limits be consistent with
United States Pharmacopeia requirements.
Alec Shedony: Mr. Shedony suggested that there be different regulations regarding cannabis
pills and tablets and stated that most non-cannabis prescribed pills are supplied monthly. Patients
should not have to go to the store every three days to pick up their prescription.
Lindsey Colmey: Ms. Colmey stated that as a consumer, the smaller dose packaging was
making it difficult for her to have access to her medication.
Rick Miller: Mr. Miller expressed concern that patients are having trouble accessing the amount
of medication they need due to the packaging limits and supported the recommendation for
raising the dosage.
Adam Villareal: Mr. Villareal stated that the dosage limits are promoting a “race to the bottom”
for products containing very low dosages and is making products less medically effective.
Valerie Corral: Ms. Corral commented that restrictions should be lifted for high THC dosages
in oral applications, topicals, and rectal applications, especially for patients who are considered
seriously ill.
Unknown: Speaker expressed support for all the Subcommittee’s recommendations and
suggested that licensing authorities and regulators look at Colorado’s packaging laws for flower
products, which only require tamper-evident packaging versus child-resistant pakaging.
Additional Committee Comments: 7 Comments
Committee Member Cermak commented that he had issues with Recommendation No. 4,
because it does not distinguish between the amount of THC or the amount of CBD when
discussing raising the dosage limits but instead only discusses the weight of the product,
regardless of its contents. He suggested that Recommendation No. 4 be separately be voted on
from the other three recommendations.
Christina Dempsey, CDPH clarified that the limits set in CDPH’s regulations are not product
weight requirements or limits, but are the limits on the amount of THC that can be in the
products.
Committee Member Jacobson questioned whether the limits in the regulations only pertain to
THC or any cannabinoid. Christina Dempsey, CDPH responded that the limits applied to THC
among its various types, THC Delta-9 is the psychoactive form of THC.
Committee Member Bulbulyan commented that he agreed with Committee Member
Cermak’s comment and stated that there needs to be more discussion and information regarding
the other types of THC, but if the regulations were to wait until more studies are done to review
dosage limits, it would be a long time. For now, raising the dosage limits will lower taxes, lower
23
packing costs, and lower production costs, and is also more feasible than removing the dosage
limits altogether.
Vice-Chair Todd commented that Recommendation No. 4 is vague in its actual wording and
does not say anything about THC but uses the term “dosage”. She requested clarification if the
recommendation is meant to apply to only THC.
Committee Member Bulbulyan responded that regarding dosage, the limits in the regulations
apply to THC and CBD, which is what the recommendation is referring to.
Committee Member Jacobson clarified that Recommendation No. 4 regards the total amount of
THC per package, not the limits on dosage in products.
Roll call vote was taken, the motion to adopt Manufacturers Subcommittee’s Recommendation
Nos. 1-4 passed on an 14-5 vote.
NAME YEA NAY ABSTAIN ABSENT RECUSAL
Avis Bulbulyan ✓ Timmen Cermak ✓ Matt Clifford ✓ Bill Dombrowski ✓ Jeff Ferro ✓ Kristin Heidelbach- ✓ Teramoto
Eric Hirata ✓ Alice Huffman ✓ Catherine Jacobson ✓ Arnold Leff ✓ Kristin Lynch ✓ Kristin Nevedal ✓ Joe Nicchitta ✓ LaVonne Peck ✓ Matt Rahn ✓ Keith Stephenson ✓ James Sweeney ✓ Tamar Todd ✓ Helena Williams ✓ David Woolsey ✓ Ben Wu ✓ Beverly Yu ✓
24
6. Discussion and Possible Action to Approve, Modify, or Reject the Subcommittee on
Microbusiness’ Recommendations (James Sweeney, Chair, Subcommittee on
Microbusiness)
Committee Member Nevedal presented the Subcommittee’s proposed recommendations to the
Committee.
Committee Comments: 20 Comments
Committee Member Nevedal motioned for the Committee to adopt Recommendation Nos. 1
and 2 as drafted. Committee Member Clifford seconded the motion.
Committee Member Clifford commented that while he supported Recommendation No. 2, he
did have an issue with the term “microbusiness” and the fact that nowhere in the statute or
regulations, except for cultivation, has a size requirement for microbusinesses. He suggested that
the recommendation be amended to state that microbusinesses are required to have cultivation as
one of their operations.
Committee Member Nevedal asked if an amendment to the recommendation could be made
now to include Committee Member Clifford’s request.
Asst. Chief Counsel Colson responded that the recommendation voted on by the Subcommittee
cannot be changed, however a motion can be made to the Committee to adopt the
recommendation with certain amendments.
Chair Rahn also commented that the language in Recommendation No. 2 says a “ceiling that
delineates” and suggested that wording may be used to establish a size limit for microbusinesses. Committee Member Wu commented that there may be microbusinesses that do not want to
participate in cultivation activities and therefore are not subject to the size limit.
Committee Member Clifford responded that while that may be true, it is also the opposite of
the true intention of the original statute regarding microbusinesses size.
Vice-Chair Todd also commented that making cultivation a requirement for a microbusiness
brings the license type back to its original intent, because the limitation of size for cultivation in
a microbusiness is what made it for small business owners.
Committee Member Wu agreed with both Committee Member Clifford and Vice-Chair
Todd and stated he wanted to make sure all loopholes are closed, one of which could be
microbusinesses without a cultivation operation and therefore no size restrictions.
Committee Member Bulbulyan commented that there needs to be more clarification regarding
what separates a microbusiness from a larger business—separation by the size of the business or
the amount of revenue the business generates.
Committee Member Cermak commented that requiring cultivation to be a part of any
microbusiness is advantageous to small farmers due to the limited cultivation size.
Committee Member Jacobson questioned if the original intent of creating a microbusiness
license and cultivation limit was to give an advantage to small farmers.
Vice-Chair Todd responded that the creation of a microbusiness concept was tied to cultivation
and was supposed to be an advantage to small farmers by allowing them to vertically integrate
their operations.
Committee Member Nevedal added that under the current regulations, if a microbusiness
decided not to cultivate, there is nothing that would keep that entity as a “micro” or small business in relation to the other three operations (retail, manufacturing, distribution). Thus, the
essence of the ability to provide a pathway for small cultivators to enter the market is lost.
25
Committee Member Ferro commented that the creation of microbusinesses was not meant to
be an advantage to small businesses but to allow small farmers, who were already invested in
manufacturing and selling their own products, to remain competitive in the market.
Committee Member Jacobson requested clarification that the amendment to Recommendation
No. 2 be that a cap for the size of the entire microbusiness, not just the cultivation aspect, be
added.
Committee Member Nevedal responded that is correct and suggested the amendment state:
“Redefine to include a ceiling that requires that the cultivation be one of the components to
qualify for a microbusiness and delineates when the business is no longer considered a
microbusiness.” Committee Member Clifford commented that the amendment should clearly state that the
microbusinesses must have a cultivation operation on an area 10,000 square feet or less.
Committee Member Nevedal responded that the recommendation could be worded to have that
requirement and stated that the regulations could also be clarified to determine if a microbusiness
can buy from other cultivators, thereby circumventing the limit size of the microbusiness by
using other product and becoming a “large” microbusiness, which is why a “ceiling” needs to be established.
Asst. Chief Counsel Colson commented that the amendments must stay within the concepts of
the original recommendation based on how it appears in the agenda which was to have a
“ceiling”, not change all the activity requirements.
Public Comment: 21 Comments
Dr. William Munjar: Dr. Munjar expressed concern that the Committee has only discussed the
implementation of these recommendations, but not how they will be enforced. He also stated that
the cannabis event organizer license should not be lumped together with the microbusiness
license.
Unknown: The public speaker suggested that the local jurisdictions determine security measures
for the businesses in their limits. The speaker also supported the idea that microbusinesses be
allowed to bring in other products than their own.
Paul Hansberry: Mr. Hansberry agreed with prior comments suggesting that local jurisdictions
create their own security requirements for the businesses in their limits; each city or county is
different.
Susan Tibbon: Ms. Tibbon cited an article stating that a “microbusiness is a firm with five or
fewer employees started for $50,000 or less initial capital and may not have access to traditional
commercial loans.” She stated that thousands of individuals felt that corporations and large
businesses have taken over what was supposed to be for small farmers and small operations.
Unknown: The speaker suggested that if one part of a microbusiness’ operation needs more room to expand, that they not have to change the layout of the building or the premises, but just
pay the additional fees for the higher-tiered license.
Bill Cooke: Mr. Cooke expressed concern that if an applicant has an agriculturally zoned
property, they cannot manufacture or have retail sales, except at seasonal farm stands. He
commented that there needs to be a way for the small farmer to enter the industry.
Zack Michaelson: Mr. Michaelson commented that requiring a microbusiness to have a
cultivation operation would hurt him and others who want a microbusiness but do not want to
cultivate. He suggested to keep Recommendation No. 2 as it is; tying gross sales to the annual
license fees.
26
Jude Tillman: Ms. Tillman stated that requiring microbusiness to have a cultivation operation
would be in conflict with the system already in place in Mendocino County. She stated that retail
dispensaries in Mendocino County do not need security personnel.
Doug Rio: Mr. Rio commented that compassionate care use programs should be exempt from
local and state taxes, as well as annual licensing fees.
Allen Steiner: Mr. Steiner stated that a lot of cities and counties do not have microbusinesses in
their ordinances because they are unaware of what they are and how they operate. He suggested
that the Bureau create materials to educate local jurisdictions about microbusinesses.
John Brower: Mr. Brower agreed with requiring microbusinesses to have a cultivation operation
on areas 10,000 square feet or less. He also agreed that local jurisdictions should oversee security
requirements for businesses in their area.
Ross Gordon: Mr. Gordon agreed with the recommendation to allow local jurisdictions to create
their own security requirements and agreed with the recommendation to create licensing tiers
tied to gross sales.
Michelle Dezitzer: Ms. Dezitzer stated that some local jurisdictions do not allow cultivation, so
making it a requirement will make it harder to get a microbusiness in some areas. She also stated
that one of the problems for a small farmer is that microbusiness’ operations must be in the same
area.
Valerie Corral: Ms. Corral stated that donated goods should not be taxed.
Dr. Silva: Dr. Silva referred to Committee Member Cermak’s suggestion that
Recommendation No. 4 be voted on separately from the other three recommendations, and
inquired as to whether that was motioned and voted on. Chair Rahn clarified it was only a
friendly recommendation to the Committee member who made the motion, but was not a motion
in and of itself.
Max Mikalonis: Mr. Mikalonis stated that the current regulations require that all operations
under a microbusiness license must be performed on the same premise which is advantageous to
having three separate licenses.
Ann Polson: Ms. Polson suggested that compassionate use programs be exempt from the
proposed cultivation requirement.
Joseph Airone: Mr. Airone agreed with the prior commenter’s recommendation to exempt
compassionate use programs from the proposed cultivation requirement for microbusinesses.
Robert May: Mr. May suggested that the local jurisdictions create security measures for
businesses in their areas. He also suggested that the Committee define what a microbusiness is
and the level of commercial activity allowed.
Rob Weiner: Mr. Weiner expressed support for the recommendations and agreed with the
recommendation to allow local jurisdictions to determine security requirements for businesses.
David Fluhart: Mr. Fluhart agreed with prior comments suggesting that local jurisdictions
handle security requirements for businesses.
Additional Committee Comments: 27 Comments
Committee Member Woolsey commented that it would not be a good idea to require
microbusinesses to have a cultivation operation, as it would allow an individual to cultivate one
plant to meet the requirement and continue with their other operations. He suggested that the
recommendations be voted on separately.
Committee Member Nevedal accepted Committee Member Woolsey’s suggestion and
motioned that Recommendation Nos. 1 and 2 be voted on separately.
27
Committee Member Clifford seconded the motion.
Committee Member Nicchitta inquired about security measures. Specifically, he asked if that is
something that can be changed in regulations or if it must be done through change in the statute.
Asst. Chief Counsel Colson clarified that the statute does call for security measures and stated
that local jurisdictions can add additional security measures on top of what the State requires.
Committee Member Nicchitta responded and questioned whether there will be a complete
elimination of security measures in the regulations if the recommendation passes, or will they
still be there due to it being statute.
Asst. Chief Counsel Colson responded that there are some requirements in the regulations that
do address security measures, but cannot speak to what changes, if any, would be made if the
recommendation was to pass.
Committee Member Nevedal cited sections 5042 to 5047 of the Bureau’s regulations which
details security personnel requirements for retailers and stated that the requirements for security
cameras, alarms, and personnel were the most challenging for stakeholders to comply with.
Asst. Chief Counsel Colson clarified that the security requirements in sections 5042 to 5047 of
the Bureau’s regulations applied to all licensees under the Bureau, not just retailers. Committee Member Nevedal questioned whether it would be better for the Committee to
specify which security measures should be reviewed and discussed.
Committee Member Woolsey questioned whether sections 5042 to 5047 of the Bureau’s
regulations would be eliminated, moving that authority to local jurisdictions if the
recommendation passes.
Committee Member Nevedal clarified that the recommendation’s intent was not to remove all security requirements, but that requirements for security cameras, alarm systems, and personnel
be reviewed, especially for businesses in rural settings.
Vice-Chair Todd commented that the recommendation seems to fit more for rural
microbusinesses, but not necessarily for urban microbusinesses, which goes back to the issue of
defining what a microbusiness is.
Committee Member Nevedal responded that under the current regulations, it is not possible to
be a rural microbusiness and the goal of the Subcommittee was to address the issues from rural
stakeholders, including issues with some of the security requirements.
Committee Member Bulbulyan commented that requiring microbusinesses have a cultivation
operation will adversely affect microbusinesses already in place, especially in urban areas where
a 10,000-square foot space would be expensive.
Committee Member Clifford clarified that 10,000 square feet is the maximum size a cultivation
site can be under a microbusiness as per statute “up to 10,000 square feet”. Committee Member Nicchitta commented that deferring security measures to local
jurisdictions would be problematic, as it may incentivize businesses to “border-hop” to get the
best economic result with no regard for market or retail needs.
Committee Member Woolsey also agreed that lowering or deferring security measures to local
jurisdictions may also cause situations where stolen goods from one jurisdiction that had more
lax security measures gets moved into another jurisdiction.
Committee Member Jacobson commented that it is difficult to vote on Recommendation No. 1
without having established a definition for microbusinesses.
Committee Member Cermak questioned the best course of action to gain more clarity into
what a microbusiness is.
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Chair Rahn suggested that the Committee make a recommendation to Staff to provide more
clarification and insight.
Committee Member Wu commented that Recommendation No. 1 can be interpreted two
ways—complete removal of the security requirements in the Bureau’s regulations and deferment
to local jurisdictions to create security measures, or keep the State’s requirements and local
jurisdictions can opt-out of the measures that do not make sense for their area.
Asst. Chief Counsel Colson commented and noted that if a business has a state license, they are
subject to all the rules and requirements attached to that license. In that sense, the State’s security requirements are the base and local jurisdictions can add additional requirements not addressed
by the state. A local jurisdiction can put in lower standards; however, a licensee will need to stay
compliant with the State’s security requirements to maintain their state license.
Committee Member Wu questioned whether there could be some sort of opt-out clause added
to the regulations for local jurisdictions to opt-out of some security requirements.
Asst. Chief Counsel Colson responded that could be added to the regulations as an opt-out by
the local jurisdiction, not the individual licensee.
Committee Member Nevedal inquired whether the recommendation should be amended to
allow microbusinesses to seek exemption from security requirements under sections 5044, 5045,
and 5047 of the Bureau’s regulations, if the local jurisdiction allows the exemption.
Committee Member Leff agreed with Committee Member Nevedal that local jurisdictions
should determine security measures and the State can put out guidelines on what they think is the
best protocol.
Committee Member Ferro and Committee Member Williams left the meeting and quorum
was maintained. Roll call vote was taken, the motion to adopt Microbusiness Subcommittee’s Recommendation No. 1 failed on an 8-6 vote. 3 Committee Members abstained.
NAME YEA NAY ABSTAIN ABSENT RECUSAL
Avis Bulbulyan ✓ Timmen Cermak ✓ Matt Clifford ✓ Bill Dombrowski ✓ Jeff Ferro ✓ Kristin Heidelbach- ✓ Teramoto
Eric Hirata ✓ Alice Huffman ✓ Catherine Jacobson ✓ Arnold Leff ✓ Kristin Lynch ✓ Kristin Nevedal ✓ Joe Nicchitta ✓
29
LaVonne Peck ✓ Matt Rahn ✓ Keith Stephenson ✓ James Sweeney ✓ Tamar Todd ✓ Helena Williams ✓ David Woolsey ✓ Ben Wu ✓ Beverly Yu ✓
Committee Member Nevedal motioned for the Committee to adopt Recommendation No. 2.
Committee Member Leff seconded the motion.
Committee Comment: 26 Comments
Committee Member Clifford suggested the recommendation be amended to require
microbusinesses have cultivation operation on areas up to 10,000 square feet in size.
Committee Member Nevedal inquired whether the recommendation motion should be amended
to state “a fee schedule should require cultivation to not exceed 10,000 square feet and include a
ceiling that delineate when a business is no longer considered a microbusiness?” Committee Member Clifford inquired whether the recommendation can be appropriately
addressed through changes in the fee schedule.
Asst. Chief Counsel Colson commented that the agenda item is related to the license tiers and
compassionate use and fee caps and the Committee must stay within those requirements when
making amendments.
Committee Member Jacobson responded to Asst. Chief Counsel Colson’s comment and
questioned whether the Committee should be discussing whether it should add cultivation
requirements, since that is not in the scope of the original agenda item.
Asst. Chief Counsel Colson clarified that the recommendation does not necessarily include
what all the requirements for a microbusiness would be and that the Committee must make sure
they are talking about the specific recommendation; not what microbusiness requirements should
be in general.
Committee Member Jacobson suggested tabling discussion regarding defining microbusinesses
and tying to cultivation operations as a future agenda item. Committee Member Cermak
agreed that this should be tabled until the next meeting and requested the Bureau to provide
clarification of what a microbusiness is.
Chair Rahn also agreed with tabling the discussion regarding defining microbusinesses until
next meeting and stated that Bureau staff can provide more insight and clarity to the Committee
for the next meeting.
Committee Member Clifford agreed and withdrew his friendly recommendation to amend
Recommendation No. 2.
Committee Member Leff moved to table the motion to the next Committee meeting.
Committee Member Jacobson commented that the Committee should vote on
Recommendation No. 2 because it is not defining a microbusiness, but suggesting that fees be
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tied to gross receipts and that a ceiling is placed that delineates when a business is no longer
considered a microbusiness.
Committee Member Bulbulyan inquired about what happens when a microbusiness hits the
ceiling and is no longer considered a microbusiness anymore.
Committee Member Nevedal responded that the benefit of a microbusiness is to incentivize
small businesses to remain in existence and stated that if a microbusiness wants to expand past
the ceiling, it is up to the licensee. However, they would be giving up the single microbusiness
license and would need to obtain separate licenses.
Committee Member Bulbulyan responded that it would be a financial hardship for a business
to have to re-do their entire business setup because they reached a ceiling and suddenly had to
give up their license.
Committee Member Nevedal commented that the decision to remain a microbusiness or expand
beyond the ceiling is up to the licensee to determine if that is the most cost-effective and sensible
course to take.
Committee Member Bulbulyan responded that in a way it is penalizing business for being
successful in growth.
Committee Member Nevedal commented that the situation is akin to individuals in the craft
beer industry who must determine if they want—or can—move into higher tax tier and stated
that the recommendation is meant to incentivize small businesses to stay small.
Committee Member Bulbulyan responded that everything the Subcommittee and Committee
discussed is how to help small businesses enter the market and continue to grow and this
recommendation has the potential to stifle growth.
Chair Rahn commented that the Committee should be cautious on setting a threshold on a dollar
amount, because it could create a situation where a business that is modeled on selling premium
product may reach that threshold, but still have low volume and would not be considered a
microbusiness.
Committee Member Jacobson responded that the recommendation is intended for the small
businesses in operation currently to continue operations, not for startup companies looking to
enter the market and expand.
Committee Member Cermak commented that the recommendation is meant to reserve vertical
integration for small businesses and to incentivize the businesses to stay small to make sure there
are not large corporations operating as microbusinesses, shutting out smaller entities.
Committee Member Bulbulyan responded that entities do not have to be microbusinesses to be
vertically integrated; they can just obtain separate licenses for each activity. The issue is not
becoming a microbusiness, it is what happens after the threshold is reached.
Committee Member Nevedal requested clarification as to whether the primary concern with the
recommendation is if a microbusiness reaches the threshold and needs to obtain separate
licenses, that they must also obtain separate premises.
Committee Member Bulbulyan responded that the primary concern is that once a
microbusiness reaches the threshold, they are penalized and given a financial hardship because
they must give up their microbusiness license if they want to continue to grow and apply and pay
for three or more separate licenses.
Committee Member Nevedal motioned that the Committee adopt Recommendation No. 2 as
drafted, with the knowledge that more discussion regarding microbusinesses will need to happen.
Committee Member Jacobson seconded the motion.
31
Roll call vote was taken, the motion to adopt Microbusiness Subcommittee’s Recommendation
No. 2 passed on an 17-0 vote.
NAME YEA NAY ABSTAIN ABSENT RECUSAL
Avis Bulbulyan ✓ Timmen Cermak ✓ Matt Clifford ✓ Bill Dombrowski ✓ Jeff Ferro ✓ Kristin Heidelbach- ✓ Teramoto
Eric Hirata ✓ Alice Huffman ✓ Catherine Jacobson ✓ Arnold Leff ✓ Kristin Lynch ✓ Kristin Nevedal ✓ Joe Nicchitta ✓ LaVonne Peck ✓ Matt Rahn ✓ Keith Stephenson ✓ James Sweeney ✓ Tamar Todd ✓ Helena Williams ✓ David Woolsey ✓ Ben Wu ✓ Beverly Yu ✓
Committee Member Nevedal presented the Microbusiness Subcommittees Recommendation
Nos. 3-6. Chair Rahn suggested that these recommendations be combined with agenda item 7 as
they deal with legislative and statutory changes. Committee Member Nevedal agreed with
Chair Rahn’s recommendation.
Public Comment: 15 Comments
Dr. William Munjar: Dr. Munjar suggested there be a graduated licensing procedure for
microbusinesses that reach the ceiling and must obtain separate licenses to continue operation.
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Susan Tibbon: Ms. Tibbon suggested that microbusiness’ retail location be a farm stand, instead
of a brick and mortar building, and that shared facilities be allowed with non-volatile manufactures
and not just oil and butter producers.
Paul Hansberry: Mr. Hansberry suggested that microbusinesses be allowed to have activities at
separate locations and have one location as a primary business which the licensing fees are paid
on.
Unknown: The speaker stated that there needs to be more clarification on what “contiguous” means in respect to microbusinesses, and supported the allowance of farm stands as a retail location
in a microbusiness.
Jude Tillman: Ms. Tillman also supported the recommendation to allow multiple non-contiguous
premises for microbusinesses.
Bob Wiener: Mr. Wiener expressed support in making microbusinesses more attainable for small
farmers and businesses.
Taylor Blake: Mr. Blake requested that one of the activities allowed under a microbusiness be the
ability to participate in cannabis events.
Bill Cooke: Mr. Cooke supported the recommendation to allow farm stand sales in rural counties.
Allen Steiner: Mr. Steiner stated that the single-premise opportunity in the microbusiness
structure offers a chance for local producers and businesses to work together.
Dr. Silver: Dr. Silver did not support the recommendation to allow farm stand sales and stated
that it would be difficult to assure enforcement of youth protection as well as other protections if
this recommendation was to pass.
John Brower: Mr. Brower expressed concern that the current microbusiness structure is shutting
out small farmers and stated that the license type was not created for giant retailers to vertically
integrate, but for the small businesses to be able to enter and compete in the market.
Ross Gordon: Mr. Gordon expressed strong support for all the recommendations presented and
stated that allowing non-contiguous premises and farm stand sales will allow farmers and
manufactures better access to consumers to develop relationships.
Robert May: Mr. May supported all the recommendations and stated that the way to get small
farmers and businesses into the market is to allow non-contiguous premises for microbusinesses.
David Fluhart: Mr. Fluhart expressed support for allowing farm stands to be used as retail
locations.
Alec Shedony: Mr. Shedony commented that before a “ceiling” is placed on microbusinesses,
there needs to be some sort of path created for microbusinesses currently in operation to transition
to separate licenses.
7. Discussion and Possible Action on How to Proceed with Recommendations
Requiring Statutory or Non-Regulatory Changes
Chair Rahn presented recommendations on how to address the legislature on proposed statutory
or non-regulatory changes.
Committee Comments: 2 Comments
Committee Member Nicchitta motioned to delegate Chair Rahn the authority to pen a letter to
the legislature identifying the major topics of concern that are legislative, not regulatory.
Committee Member Woolsey seconded the motion.
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Public Comment:8 Comments
Unknown: The speaker expressed concern regarding what topics will be included in the letter to
the legislature.
Unknown: The speaker suggested that a second letter also be penned to the licensing authorities,
requesting clarification on the regulations brought up in discussion.
Jude Tillman: Ms. Tillman respectfully requested how the public can help the Committee
pressure the legislature and licensing authorities to make the proposed changes happen.
Dr. William Munjar: Dr. Munjar suggested that a letter be penned to the President of the United
States requesting the rescheduling of marijuana from a Schedule 1 drug.
Bill Cooke: Mr. Cooke expressed support for penning a letter to legislature and suggested allowing
microbusinesses be smaller businesses, but not necessarily vertically integrated.
Robert May: Mr. May suggested the Committee write a letter to the licensing authorities
requesting a relaxing of regulations to allow businesses to thrive.
Unknown: The speaker supported the recommendation for non-contiguous premises for
microbusinesses and requested that microbusinesses be allowed to take in product from other small
cultivators.
Unknown: The speaker commented that the according to the Small Business Administration,
small businesses are defined as being “dependent on an industry” and can have revenue ranging
from $750,000 to $38.5 million. They stated that $750,000 is a small number and businesses should
not be penalized for reaching that number.
Additional Committee Comment: 2 Comments
Committee Member Cermak asked whether Chair Rahn would take input from the chairs of
each Subcommittee as to what topics will be included in the letter to legislature. Chair Rahn
stated that he will be reviewing past Committee meeting webcasts and Subcommittee hearings to
make sure each Subcommittee’s topics of concern are appropriately addressed.
Committee Member Jacobson clarified to the Committee and to the public that the letter being
written to legislature is being done because the Subcommittees discussed issues of concern raised
that are non-regulatory and are out of the control of the licensing authorities.
Committee Member Todd exited the meeting and the Committee maintained quorum. Roll call
vote was taken, the motion to pen a letter to legislature regarding statutory and non-regulatory
changes passed on an 15-0 vote. 1 Committee Member abstained.
NAME YEA NAY ABSTAIN ABSENT RECUSAL
Avis Bulbulyan ✓ Timmen Cermak ✓ Matt Clifford ✓ Bill Dombrowski ✓ Jeff Ferro ✓ Kristin Heidelbach- ✓ Teramoto
Eric Hirata ✓ Alice Huffman ✓
34
Catherine Jacobson ✓ Arnold Leff ✓ Kristin Lynch ✓ Kristin Nevedal ✓ Joe Nicchitta ✓ LaVonne Peck ✓ Matt Rahn ✓ Keith Stephenson ✓ James Sweeney ✓ Tamar Todd ✓ Helena Williams ✓ David Woolsey ✓ Ben Wu ✓ Beverly Yu ✓
8. Public Comment on Items Not on the Agenda
Public Comments: 20 Comments
Susan Tibbon: Ms. Tibbon stated that the Bureau’s position regarding what the cultivation area under a microbusiness is arbitrary and completely unworkable. The current 10,000 square foot
area including the garden, the drying area, and the processing area is another impediment for
many cultivators especially in the northern counties.
Paul Hansberry: Mr. Hansberry stated that there are plenty of resources available that define
microbusinesses that the Committee can reference.
Dr. Silver: Dr. Silver respectfully requested that the Committee recommend that the CDPH
carry out an in-depth assessment of potential public health impacts and recommend regulatory
actions for the issues of increasing potency of THC in products, the proliferation of flavored non-
edible products, and retail locations promoting use during pregnancy.
Ray Pers: Mr. Pers expressed concern that there was no discussion of the equity
Subcommittee’s recommendations during the hearing and stated that there needs to be an equity program for African Americans and people of color separate from the general social equity
group.
Gillian Levy: Ms. Levy stated that while CDPH has permitted the manufacturing of alcohol
tinctures, the product cannot pass the residual solvent test set in the Bureau’s testing laboratory regulations. She requested clarification on how to be compliant with testing.
Ryan Miller: Mr. Miller suggested that the topic of disposal of “contaminated cannabis
hardware” such as vape pens, cartridges, and batteries, be discussed at the next Committee
hearing.
Nick Peraino: Mr. Peraino is with Service Employees International Union (SEIU) Local 1021,
and commented that the administration introduced a budget trailer bill that, if passed, will change
the funding allocations under Prop 64 and re-prioritize where some of the funding goes. This
35
would require new regulations to be drafted. Mr. Peraino requested that the Committee discuss
this topic at the next meeting.
Jim Lewi: Mr. Lewi thanked the Committee for all their work and requested that cannabis
events be placed on the agenda for the next meeting.
Charley Pappas: Mr. Pappas thanked the Committee for their work and looked forward to
continuing working together.
Unknown: The speaker stated that 501(c)(3) non-profit organizations are illegal in the cannabis
industry and supported earlier public comments that donated cannabis goods should not be taxed.
Unknown: Speaker thanked the Committee for all their work and suggested that the Committee
discuss the July 1, 2018 transition deadline in a future agenda. The speaker indicated the July 1,
2018 deadline should stay because it will be the only thing that will create a “white-market”
demand. In addition, the speaker suggested additional agenda topics such as licensees ability to
offer samples, and retailers and microbusinesses being allowed to participate in county fairs and
local events other than cannabis events.
Anne Kelson: Ms. Kelson thanked the Committee for their work and for listening to the public
and working together to address the issues of stakeholders in the industry.
Unknown: The speaker expressed concern regarding the dosage limits in edible products and
suggested that pills and tablets be considered separately from edibles and non-edible topicals.
Allen Steiner: Mr. Steiner suggested there be more discussion regarding the employees of
cannabis businesses to make sure they are trained and up to date with current industry practices.
Bob Wiener: Mr. Wiener suggested discussing the cultivation tax as a future agenda item.
Unknown: The speaker requested that the Bureau consider adding a packaging-only permit so
that businesses can package at a separate facility other than manufacturing and that the Bureau
be more responsive and helpful when licensees call to request clarification on regulations.
Rich Miller: Mr. Miller repeated his earlier statement that regarding labeling, packaging, and
testing, cannabinoid profiles that are above .50 need to be considered as well as CBDs.
Jackie McGowan: Ms. McGowan requested that the topic of local control be added to the next
agenda.
David Fluhart: Mr. Fluhart suggested that past Committee and Subcommittee discussions be
made available online. He also suggested that the topic of a state public trust be put on the
agenda for the next hearing.
Unknown: Speaker suggested the Bureau create a new license type for businesses that want to
create web-based platforms for businesses.
9. Future Agenda Items
Committee Comments: 7 Comments
Committee Member Nicchitta suggested that the Committee discuss temporary cannabis events,
public health issues, and research using medical cannabis at the next Committee hearing in San
Diego.
Committee Member Peck suggested that the issue of tribes and indigenous peoples entering the
market be discussed as a future agenda item.
Committee Member Jacobson questioned if presentations by experts about public health was
still going to occur. Chair Rahn responded that it is currently being worked on and public health
will be discussed in the next few meetings.
Committee Member Jacobson commented that waste disposal, taxation of donated goods, and
seed and plant packaging issues should be added as future agenda items.
36
Committee Member Nevedal commented that taxation in general, not just of donated goods,
should be discussed.
Committee Member Stephenson commented that the issue of exit packaging needs to be
discussed.
Committee Member Cermak requested that time in the agenda be saved for the Subcommittees
that did not have all their recommendations put forward and have not have the opportunity to
discuss their topics.
10. Adjournment: 4:44 PM
37