PRINTER'S NO. 1361
THE GENERAL ASSEMBLY OF PENNSYLVANIA
SENATE BILL
No.
350
Session of
2019
INTRODUCED BY LEACH, STREET, FARNESE AND TARTAGLIONE,
OCTOBER 31, 2019
REFERRED TO AGRICULTURE AND RURAL AFFAIRS, OCTOBER 31, 2019
AN ACT
Amending Titles 3 (Agriculture), 18 (Crimes and Offenses) and 42
(Judiciary and Judicial Procedure) of the Pennsylvania
Consolidated Statutes, providing for adult-use cannabis and
establishing the Adult-Use Cannabis Grant Program and the
Adult-Use Cannabis Fund; in criminal history record
information, further providing for expungement; in
sentencing, providing for commutation and dismissal of
cannabis-related offenses; and imposing penalties.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Part I of Title 3 of the Pennsylvania
Consolidated Statutes is amended by adding a chapter to read:
CHAPTER 10
ADULT-USE CANNABIS
Subchapter
A. Preliminary Provisions
B. Regulation of Use
C. Permits
D. Educational Instruction and Exam
E. Adult-Use Cannabis Grant Program
F. Interest-Free Loans
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G. Tax on Adult-Use Cannabis
H. Adult-Use Cannabis Fund
I. Colleges and Universities
J. Tracking System
K. Administration and Penalties
SUBCHAPTER A
PRELIMINARY PROVISIONS
Sec.
1001. Short title of chapter.
1002. Declaration of policy.
1003. Definitions.
§ 1001. Short title of chapter.
This chapter shall be known and may be cited as the Adult-Use
Cannabis Act.
§ 1002. Declaration of policy.
The General Assembly finds and declares that:
(1) In 2017, 20,392 adults and 2,269 juveniles were
charged in this Commonwealth with low-level cannabis
possession offenses according to the Pennsylvania Uniform
Crime Reporting System.
(2) Police arrest 55 adults every day for simple
cannabis possession in this Commonwealth.
(3) African Americans are eight times more likely than
individuals who are white to be arrested for cannabis
possession in this Commonwealth, even though usage rates are
similar.
(4) A simple possession conviction is punishable by up
to 30 days of incarceration and a $500 fine for less than an
ounce of cannabis and up to one year of incarceration and a
$5,000 fine if arrested with over an ounce for personal use.
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(5) A simple cannabis possession conviction prevents
individuals from getting certain jobs.
(6) The Commonwealth spends $46,000,000 annually to
prosecute residents for possession of less than an ounce of
cannabis.
(7) It is the intent of the General Assembly to end the
Commonwealth's prohibition of cannabis, help individuals who
have been harmed by cannabis prohibition and establish and
tax a regulated and thriving cannabis industry in this
Commonwealth.
§ 1003. Definitions.
The following words and phrases when used in this chapter
shall have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Applicant." A person that applies or has applied to the
department for a permit.
"Business interest." A stake in, employment relationship
with or other interest in a person, including an individual,
corporation, partnership, association, trust or other entity, or
any combination thereof, that holds a permit issued by the
department. The term does not include:
(1) Interest held by a financial institution in a
permittee.
(2) Interest held by a trade association in a permittee.
(3) A de minimis interest held by a person, including an
individual, corporation, partnership, association, trust or
other entity, or any combination thereof, in a permittee.
"Cannabis."
(1) Any of the following:
(i) all parts of a plant of the genus cannabis,
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whether growing or not, including the seeds of the plant;
(ii) the resin extracted from any part of a plant of
the genus cannabis, including concentrated cannabis; or
(iii) a compound, manufacture, salt, derivative,
mixture or preparation of a plant of the genus cannabis,
its seeds or resin.
(2) The term does not include industrial hemp as defined
under section 702 (relating to definitions) or its
derivatives or cannabidiol (CBD) oil from hemp.
"Change in control." The acquisition by a person or group of
persons acting in concert of a controlling interest in an
applicant or permittee either all at one time or over the span
of a consecutive 12-month period.
"Controlling interest." The following:
(1) For a publicly traded entity, voting rights that
entitle a person to elect or appoint one or more of the
members of the board of directors or other governing board or
the ownership or beneficial holding of 5% or more of the
securities of the publicly traded entity.
(2) For a privately held entity, the ownership of any
security in the entity.
"Deliverer." A person, including an individual, corporation,
partnership, association, trust or other entity, or any
combination thereof, that holds a permit issued by the
department to deliver cannabis.
"Department." The Department of Agriculture of the
Commonwealth.
"Dispensary." A person, including an individual,
corporation, partnership, association, trust or other entity, or
any combination thereof, that holds a permit issued by the
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department to dispense cannabis.
"Financial backer." An investor, mortgagee, bondholder, note
holder or other source of equity, capital or other assets. The
term does not include a financial institution.
"Financial institution." A bank, national banking
association, bank and trust company, trust company, savings and
loan association, building and loan association, mutual savings
bank, credit union or savings bank.
"Fund." The Adult-Use Cannabis Fund established under
Subchapter H (relating to Adult-Use Cannabis Fund).
"Grant program." The Adult-Use Cannabis Grant Program
established under Subchapter E (relating to Adult-Use Cannabis
Grant Program).
"Grower." A person, including an individual, corporation,
partnership, association, trust or other entity, or any
combination thereof, that holds a permit issued by the
department to grow cannabis.
"Homegrower." An individual who holds a permit issued by the
department to grow cannabis in the person's home for personal
use.
"Microgrower." A person who holds a permit issued by the
department to grow cannabis in the person's home with the intent
to sell the cannabis to a processor or dispensary.
"Permit." An authorization issued by the department to
conduct activities under this chapter.
"Permittee." A person, including an individual, corporation,
partnership, association, trust or other entity, or any
combination thereof, that holds a permit issued by the
department.
"Principal." An officer, director or person that directly
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owns a beneficial interest in or ownership of the securities of
an applicant or permittee, a person that has a controlling
interest in an applicant or permittee or that has the ability to
elect the majority of the board of directors of an applicant or
permittee or otherwise control an applicant or permittee. The
term does not include a financial institution.
"Processor." A person, including an individual, corporation,
partnership, association, trust or other entity, or any
combination thereof, that holds a permit issued by the
department to process cannabis.
"Secretary." The Secretary of Agriculture of the
Commonwealth.
"Security." As defined in section 102(t) of the act of
December 5, 1972 (P.L.1280, No.284), known as the Pennsylvania
Securities Act of 1972.
"Seed-to-sale tracking system." An electronic inventory
tracking system accessible by the department which
electronically tracks cannabis possessed by permittees.
"Use lounge." A space, determined by the department, in
which individuals may use cannabis which the individuals have
brought to the space. The space may be public or private and may
be owned by a person, including an individual, corporation,
partnership, association, trust, government or other entity, or
any combination thereof. The space may be shared with, attached
to or adjacent to a dispensary, in which case the dispensary may
require that patrons of the use lounge use only cannabis sold by
the dispensary while on the use lounge's premises.
SUBCHAPTER B
REGULATION OF USE
Sec.
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1004. Adult-use of cannabis.
§ 1004. Adult-use of cannabis.
(a) General rule.--An individual over 21 years of age may
engage in the use of cannabis in this Commonwealth.
(b) Using cannabis.--The use of cannabis includes, but is
not limited to, eating cannabis, smoking cannabis, vaporizing
cannabis, rubbing cannabis on one's skin and any other method of
consuming cannabis.
(c) Public use prohibited.--Use of cannabis in public is
prohibited. This subsection shall not prohibit a use lounge from
allowing cannabis to be brought onto or used on its premises by
an individual over 21 years of age.
SUBCHAPTER C
PERMITS
Sec.
1005. Issuance of permits.
1006. Duty to report.
1007. Processing of permit applications and renewals.
1008. Suspension or revocation.
1009. Nontransferability and revocability.
1010. Regulation of industry.
§ 1005. Issuance of permits.
(a) General rule.--The department may issue a permit to an
applicant that has applied to the department to act as any of
the following:
(1) Grower.
(2) Homegrower.
(3) Microgrower.
(4) Processor.
(5) Dispensary.
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(6) Deliverer.
(7) Use lounge.
(b) Form.--The application for a permit under this section
shall be on a form prescribed by the department.
(c) Application for growers, processors and dispensaries.--
An application submitted by a grower, processor or dispensary
shall include:
(1) Verification of all principals, operators and
financial backers.
(2) A description of responsibilities as a principal,
operator or financial backer.
(3) Any release necessary to obtain information from
governmental agencies, employers and other organizations.
(4) Details relating to a similar license, permit or
other authorization obtained in another jurisdiction,
including any suspensions, revocations or discipline in that
jurisdiction.
(5) A statement that the applicant:
(i) Possesses the ability to obtain in an
expeditious manner the right to use sufficient land,
buildings and other premises and equipment to properly
carry on the activity described in the application and
any proposed location for a facility.
(ii) Is able to maintain effective security and
control to prevent diversion, abuse and other illegal
conduct relating to cannabis.
(iii) Is able to comply with all applicable laws and
regulations relating to activities under this chapter.
(6) The name, residential address and title of each
financial backer and principal associated with the applicant.
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Each individual, or lawful representative of a legal entity,
shall submit an affidavit with the application providing any
position of management or ownership during the preceding 10
years of a controlling interest in any other business,
located inside or outside this Commonwealth, manufacturing or
distributing controlled substances.
(7) Notice that a false statement made in the
application is punishable under the applicable provisions of
18 Pa.C.S. Ch. 49 (relating to falsification and
intimidation).
(8) A description of the location at which and space in
which the applicant intends to operate. If the applicant is
applying for a grower permit, the applicant shall explain
whether it will grow cannabis in an indoor space or an
outdoor space.
(9) Any other information the department may require.
(d) Application for homegrowers.--An application submitted
by a homegrower shall include:
(1) Any release necessary to obtain information from
governmental agencies, employers and other organizations.
(2) Details relating to a similar license, permit or
other authorization obtained in another jurisdiction,
including any suspensions, revocations or discipline in that
jurisdiction.
(3) A statement that the applicant is able to comply
with all applicable laws and regulations relating to
activities under this chapter.
(4) Notice that a false statement made in the
application is punishable under the applicable provisions of
18 Pa.C.S. Ch. 49.
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(5) Any other information the department may require.
(e) Application for microgrowers.--An application submitted
by a microgrower shall include:
(1) Any release necessary to obtain information from
governmental agencies, employers and other organizations.
(2) Details relating to a similar license, permit or
other authorization obtained in another jurisdiction,
including any suspensions, revocations or discipline in that
jurisdiction.
(3) A statement that the applicant is able to comply
with all applicable Commonwealth laws and regulations
relating to activities under this chapter.
(4) Notice that a false statement made in the
application is punishable under the applicable provisions of
18 Pa.C.S. Ch. 49.
(5) A description of the location at which and space in
which the applicant intends to operate.
(6) Any other information the department may require.
(f) Application for deliverers.--An application submitted by
a deliverer shall include:
(1) Verification of all principals, operators and
financial backers.
(2) A description of responsibilities as a principal,
operator or financial backer.
(3) Any release necessary to obtain information from
governmental agencies, employers and other organizations.
(4) Details relating to a similar license, permit or
other authorization obtained in another jurisdiction,
including any suspensions, revocations or discipline in that
jurisdiction.
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(5) A statement that the applicant is able to comply
with all applicable Commonwealth laws and regulations
relating to activities under this chapter.
(6) Notice that a false statement made in the
application is punishable under the applicable provisions of
18 Pa.C.S. Ch. 49.
(7) Any other information the department may require.
(g) Application for use lounges.--An application for a use
lounge shall include:
(1) Verification of all principals, operators and
financial backers.
(2) A description of responsibilities as a principal,
operator or financial backer.
(3) Any release necessary to obtain information from
governmental agencies, employers and other organizations.
(4) Details relating to a similar license, permit or
other authorization obtained in another jurisdiction,
including any suspensions, revocations or discipline in that
jurisdiction.
(5) A statement that the applicant:
(i) Possesses the ability to obtain in an
expeditious manner the right to use sufficient land,
buildings and other premises and equipment to properly
carry on the activity described in the application and
any proposed location for a facility.
(ii) Is able to maintain effective security and
control to prevent diversion, abuse and other illegal
conduct relating to cannabis.
(iii) Is able to comply with all applicable laws and
regulations relating to activities under this chapter.
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(6) The name, residential address and title of each
financial backer and principal associated with the applicant.
Each individual, or lawful representative of a legal entity,
shall submit an affidavit with the application providing any
position of management or ownership during the preceding 10
years of a controlling interest in any other business,
located inside or outside this Commonwealth, manufacturing or
distributing controlled substances.
(7) Notice that a false statement made in the
application is punishable under the applicable provisions of
18 Pa.C.S. Ch. 49.
(8) A description of the location at which and space in
which the applicant intends to operate.
(9) Any other information the department may require.
§ 1006. Duty to report and submit to inspection.
An applicant for a permit under section 1005 (relating to
issuance of permits) and a permittee shall be under a continuing
duty to do all of the following:
(1) Report to the department any change in facts or
circumstances reflected in the application or permit or any
newly discovered or occurring fact or circumstance which is
required to be included in the application, including a
change in control of the applicant or permittee.
(2) Submit to announced or unannounced inspections by
the department of the facilities related to the application
or the permit.
§ 1007. Processing of permit applications and renewals.
(a) General rule.--The department may issue or deny a permit
under section 1005 (relating to issuance of permits). In
deciding whether to issue or deny a permit, the department shall
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consider only if:
(1) The application is truthful.
(2) The application is complete.
(3) The application fulfills the requirements of this
chapter.
(4) The applicant has a previous history in this
Commonwealth or in another jurisdiction of suspension,
revocation or discipline related to a license, permit or
other authorization that is similar to the permit for which
the applicant is applying.
(b) Notice of denial.--If the department denies an
application for a permit, the department shall notify the
applicant in writing within 30 days of the denial and provide to
the applicant an explanation of the department's basis for the
denial.
(c) Previous denial.--A previous denial by the department of
an application for a permit shall not preclude an applicant from
applying for another permit.
(d) Other permit.--In deciding whether to issue or deny a
permit application, the department may not consider if the
applicant holds a permit issued by the Department of Health
under the act of April 17, 2016 (P.L.84, No.16), known as the
Medical Marijuana Act.
(e) Permit renewal.--The department shall create a permit
renewal application and renew a permit unless the department
determines that the applicant is unlikely to comply with the
applicable laws of this Commonwealth.
(f) Processor tiers.--In issuing a processor permit, the
department shall determine if the permit being issued is a Tier
A Processor Permit or a Tier B Processor Permit and notify the
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applicant of the department's determination.
§ 1008. Suspension or revocation.
The department may suspend or revoke a permit if the permit
holder intentionally, knowingly, recklessly or negligently
failed to comply with any Federal, State or local laws,
regulations orders or ordinances.
§ 1009. Nontransferability and revocability.
The following shall apply:
(1) A permit issued under this chapter shall be
nontransferable.
(2) The issuance or renewal of a permit shall be a
revocable privilege.
§ 1010. Regulation of industry.
(a) Growers.--The following shall apply to permits for
growers:
(1) A grower applicant shall submit an application and
an application fee of $100,000 to the department. The permit
may be renewed annually for a $10,000 renewal fee.
(2) An individual may not intentionally or knowingly
have a business interest in more than one grower in this
Commonwealth.
(3) A grower may grow cannabis in an outdoor space or an
indoor space. A grower may not simultaneously grow cannabis
in an indoor space and an outdoor space.
(4) The total size of a grower's crop at any given time
shall be no larger than 150,000 square feet of outdoor space
or 60,000 square feet of indoor space unless the department
modifies these limits under subsection (i).
(5) A grower may sell cannabis to processors and
dispensaries.
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(6) A grower shall maintain effective security,
surveillance, recordkeeping, tracking and control to prevent
diversion, abuse and other illegal conduct relating to
cannabis.
(7) The buildings used by the grower to conduct business
operations shall within one year of becoming operational
receive a silver, gold or platinum certification from the
United States Green Building Council's Leadership in Energy
and Environmental Design Green Building Rating System or two,
three or four Globes under the Green Building Initiative's
Green Globes Green Building Rating System.
(8) A grower shall disclose to a purchaser of the
grower's cannabis information about the cannabis being
purchased as required by the department.
(9) A grower may grow cannabis.
(b) Microgrowers.--The following shall apply to permits for
microgrowers:
(1) Individuals may not intentionally or knowingly have
a business interest in more than one microgrower in this
Commonwealth.
(2) A microgrower applicant shall submit an application
and an application fee of $250 to the department. The permit
may be renewed annually for a $250 renewal fee.
(3) A microgrower may grow up to 150 cannabis plants
simultaneously unless the department modifies this limit
under subsection (i).
(4) A microgrower may only grow cannabis indoors in the
home in which the microgrower lives.
(5) A microgrower shall sell all of the cannabis which
the microgrower grows to a processor or dispensary or the
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cannabis shall be destroyed by the microgrower. The cannabis
may not be used by the microgrower.
(c) Homegrowers.--The following shall apply to permits for
homegrowers:
(1) A homegrower applicant shall submit an application
and an application fee of $50 to the department. The permit
may be renewed annually for a $50 renewal fee.
(2) A homegrower may grow up to 10 cannabis plants
simultaneously in the home in which the homegrower lives
unless the department modifies this limit under subsection
(i). A homegrower may also process his cannabis plants.
(3) The cannabis grown by the homegrower may be
transferred for free to any other person that may legally use
cannabis under this chapter. A homegrower may not sell or
trade the cannabis that the homegrower grows in the
homegrower's home.
(4) The cannabis grown or processed by the homegrower
may be used in any private place unless otherwise prohibited.
(5) The cannabis grown or processed by the homegrower
may be used in a use lounge unless otherwise prohibited.
(6) An individual may not have more than one homegrower
permit.
(d) Processors.--The following shall apply to permits for
processors:
(1) Individuals may not intentionally or knowingly have
a business interest in more than one processor.
(2) An applicant for a Tier A Processor Permit shall
submit an application and an application fee of $1,000 to the
department. The permit may be renewed annually for a $1,000
renewal fee.
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(3) An applicant for a Tier B Processor Permit shall
submit an application and an application fee of $30,000 to
the department. The permit may be renewed annually for a
$10,000 renewal fee.
(4) A processor may purchase cannabis from growers and
microgrowers.
(5) A processor may sell cannabis to dispensaries.
(6) The buildings used by the processor to conduct
business operations shall within one year of becoming
operational receive a silver, gold or platinum certification
from the United States Green Building Council's Leadership in
Energy and Environmental Design Green Building Rating System
or two, three or four Globes under the Green Building
Initiative's Green Globes Green Building Rating System.
(7) The following shall apply:
(i) A processor holding a Tier A Processor Permit
may purchase up to 25 pounds of cannabis on a wholesale
basis annually unless the department modifies this limit
under subsection (i).
(ii) A processor holding a Tier B Processor Permit
may purchase any amount of cannabis on a wholesale basis
annually unless the department modifies this limit under
subsection (i).
(8) The following shall apply:
(i) A processor holding a Tier A Processor Permit
shall maintain minimum security protocols designed to
prevent illegal diversion of cannabis.
(ii) A processor holding a Tier B Processor Permit
shall maintain effective security, surveillance,
recordkeeping, tracking and control to prevent diversion,
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abuse and other illegal conduct relating to cannabis.
(9) A processor shall disclose to a purchaser of the
processor's cannabis information about the cannabis being
purchased as required by the department.
(10) A processor may process cannabis.
(e) Dispensaries.--The following shall apply to permits for
dispensaries:
(1) A dispensary applicant shall submit an application
and an application fee of $5,000 to the department. The
permit may be renewed annually for a $5,000 renewal fee.
(2) Individuals may not intentionally or knowingly have
a business interest in more than three dispensaries. This
paragraph does not apply to an individual who:
(i) has a delivery permit; and
(ii) does not have any other permit provided for
under this chapter.
(3) A dispensary may employ or contract with a
deliverer.
(4) A dispensary may purchase cannabis from growers,
processors and microgrowers.
(5) A dispensary may sell cannabis at retail to
consumers who are at least 21 years of age.
(6) A dispensary that sells single-use vaporizers shall
accept used single-use vaporizers and recycle them. A
dispensary may not charge money for accepting single-use
vaporizers or for recycling single-use vaporizers.
(7) A dispensary shall utilize a system that effectively
recalls products that the dispensary sells to consumers.
(8) The buildings used by the dispensary to conduct
business operations shall within one year of becoming
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operational receive a silver, gold or platinum certification
from the United States Green Building Council's Leadership in
Energy and Environmental Design Green Building Rating System
or two, three or four Globes under the Green Building
Initiative's Green Globes Green Building Rating System.
(9) A dispensary may hold a use lounge permit. A
dispensary that holds a use lounge permit may operate a use
lounge that is shared with, attached to or adjacent to the
dispensary, in which case the dispensary may require that
patrons of the use lounge use only cannabis sold by the
dispensary while on the use lounge's premises.
(10) (i) Notwithstanding any provision of the act of
April 17, 2016 (P.L.84, No.16), known as the Medical
Marijuana Act, to the contrary, a dispensary may:
(A) hold a dispensary permit as provided under
the Medical Marijuana Act; and
(B) combine the retail environments of its
dispensary and medical cannabis dispensary and sell
both adult-use cannabis and medical cannabis from the
same location, building and point of sale terminal.
(ii) An arrangement under this paragraph shall not
preclude a medical cannabis dispensary permittee from its
obligations under the Medical Marijuana Act which do not
conflict with this act, including, but not limited to,
the Medical Marijuana Act 's seed-to-sale tracking
requirements, testing requirements and taxation
requirements.
(11) In addition to any other penalty provided by law, a
dispensary shall be liable for civil treble damages for harm
caused by inaccurate labeling of cannabis sold by the
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dispensary due to the dispensary's intentional, knowing,
reckless or negligent conduct.
(12) A dispensary shall disclose to a purchaser of the
dispensary's cannabis information about the cannabis being
purchased as required by the department.
(f) Deliverers.--The following shall apply to permits for
deliverers:
(1) A deliverer applicant shall submit an application
and an application fee of $50 to the department. The permit
may be renewed annually for a $50 renewal fee.
(2) A deliverer may be an employee of a dispensary, an
independent contractor doing business with a dispensary or a
standalone business.
(3) A deliverer may deliver cannabis from dispensaries
to consumers.
(4) A deliverer that is an independent contractor doing
business with a dispensary may accept compensation for the
deliverer's services from dispensaries.
(5) A deliverer that operates a standalone business may
accept compensation for the deliverer's services from
consumers.
(6) A deliverer may deliver cannabis from a dispensary
to a consumer using any mode of transportation, including any
form of public transportation not otherwise prohibited by
law. A deliverer may deliver cannabis from a dispensary to a
consumer by walking from the dispensary to the consumer.
(g) Use lounges.-- A use lounge applicant shall submit an
application and an application fee of $1,000 to the department.
The permit may be renewed annually for a $1,000 renewal fee.
(h) Fee adjustments.--Beginning three years after the
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effective date of this section, and biennially thereafter, all
permit fees and permit renewal fees under this section shall be
increased by the department at the rate of inflation as outlined
in the Consumer Price Index for All Urban Consumers in the
Northeast Region for the most recent 12-month period for which
the figures have been reported by the United States Department
of Labor, Bureau of Labor Statistics. If the rate of inflation
does not increase, all permit fees and permit renewal fees under
this section shall remain the same as they were for the previous
year. The department shall transmit notice of any fee changes to
the Legislative Reference Bureau for publication in the
Pennsylvania Bulletin.
(i) Crop and purchase adjustments.--Beginning three years
after the effective date of this section, and biennially
thereafter, the department may promulgate regulations to modify
the total maximum size of a grower's crop under subsection (a),
the total number of plants a microgrower may grow simultaneously
under subsection (b), the total number of plants a homegrower
may grow simultaneously under subsection (c) and the total
amount of cannabis a processor may purchase on a wholesale basis
annually under subsection (d) to foster an adult-use cannabis
market in this Commonwealth that meets consumer demand and
encourages competition among permittees.
SUBCHAPTER D
EDUCATIONAL INSTRUCTION AND EXAM
Sec.
1011. Curriculum.
1012. Exam.
1013. Required instruction and exam.
1014. Locations.
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1015. Cost.
§ 1011. Curriculum.
The department shall develop a curriculum providing no less
than 20 hours of classroom instruction and no more than 40 hours
of classroom instruction to educate prospective participants in
the adult-use cannabis industry. The curriculum shall include
education on the science of growing, processing and testing
cannabis, applicable Federal and State laws relating to cannabis
and how to run a small cannabis business in the Commonwealth.
§ 1012. Exam.
The department shall develop an exam to test the knowledge of
students who complete the curriculum provided under this
subchapter and shall also develop exam-grading criteria to
determine if a student learned the curriculum at a satisfactory
level as determined by the department.
§ 1013. Required instruction and exam.
To be eligible for a grant under Subchapter E (relating to
Adult-Use Cannabis Grant Program) or a loan under Subchapter F
(relating to interest-free loans), a grant or loan applicant
shall complete the curriculum provided under section 1011
(relating to curriculum) and receive from the department a
satisfactory grade or better on the exam provided under section
1012 (relating to exam).
§ 1014. Locations.
The department shall create a geographically diverse network
of locations for applicants to complete the instruction and exam
requirements under this subchapter, including universities
within the State System of Higher Education, State-related
institutions, community colleges and private entities.
§ 1015. Cost.
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The department may require an applicant to pay a fee of up to
$50 to attend a class under this subchapter and a fee of up to
$50 to take the exam under this subchapter.
SUBCHAPTER E
ADULT-USE CANNABIS GRANT PROGRAM
Sec.
1016. Establishment.
1017. Publication and notice.
1018. Award of grants.
1019. Limitation.
§ 1016. Establishment.
The Adult-Use Cannabis Grant Program is established and shall
be administered by the department. Grants provided under the
grant program shall be used to provide financial assistance to
growers, processors, dispensers and microgrowers who were harmed
by the effects of cannabis prohibition prior to the effective
date of this section.
§ 1017. Publication and notice.
The department shall transmit notice of the grant program
availability to the Legislative Reference Bureau for publication
in the Pennsylvania Bulletin.
§ 1018. Award of grants.
The department is authorized to make a grant award to a
person who receives a permit under section 1005 (relating to
issuance of permits), has a prior cannabis-related criminal
conviction, has an annual household income below $80,000 as
adjusted annually by the department for inflation and who meets
the requirements of section 1013 (relating to required
instruction and exam).
§ 1019. Limitation.
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The total amount of grants awarded under section 1018
(relating to award of grants) may not exceed $2,000,000
annually.
SUBCHAPTER F
INTEREST-FREE LOANS
Sec.
1020. Authorization.
1021. Limitation.
§ 1020. Authorization.
The department is authorized to make interest-free loans to a
person who receives a permit under section 1005 (relating to
issuance of permits), has a prior cannabis-related criminal
conviction, has an annual household income below $80,000 as
adjusted annually by the department for inflation and who meets
the requirements of section 1013 (relating to required
instruction and exam).
§ 1021. Limitation.
The total amount of loans awarded under section 1020
(relating to authorization) may not exceed $2,000,000 annually.
SUBCHAPTER G
TAX ON ADULT-USE CANNABIS
Sec.
1022. Imposition of tax.
1023. Additional taxation.
1024. Collection of tax.
1025. Deposit of proceeds.
§ 1022. Imposition of tax.
A tax is imposed at the point-of-sale of cannabis by a
dispensary at the rate of 17.5%.
§ 1023. Additional taxation.
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The tax imposed under section 1022 (relating to imposition of
tax) shall be in addition to the tax imposed under section 202
of the act of March 4, 1971 (P.L.6, No.2), known as the Tax
Reform Code of 1971.
§ 1024. Collection of tax.
A dispensary shall collect the tax under section 1022
(relating to imposition of tax) and remit the tax to the
Department of Revenue.
§ 1025. Deposit of proceeds.
The Department of Revenue shall deposit money received under
section 1024 (relating to collection of tax) into the fund.
SUBCHAPTER H
ADULT-USE CANNABIS FUND
Sec.
1026. Establishment.
1027. Source of money.
1028. Use of money.
§ 1026. Establishment.
The Adult-Use Cannabis Fund is established as a restricted
account in the State Treasury. The money in the fund shall be
appropriated on a continuing basis.
§ 1027. Source of money.
Money received under Subchapters C (relating to permits) and
G (relating to tax on adult-use cannabis) shall be deposited
into the fund.
§ 1028. Use of money.
The money deposited into the fund shall be used as follows:
(1) Nine million dollars shall be distributed to the
department annually and used to carry out its duties under
this chapter, which include awarding grants under Subchapter
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E (relating to Adult-Use Cannabis Grant Program) and loans
under Subchapter F (relating to interest-free loans).
(2) After consideration of the revenue to be deducted
from the fund under paragraph (1), 95% of the revenue
remaining in the fund annually shall be distributed to school
districts based on the 2016 basic education funding formula
under Article XXV of the act of March 10, 1949 (P.L.30,
No.14), known as the Public School Code of 1949.
SUBCHAPTER I
COLLEGES AND UNIVERSITIES
Sec.
1029. Cannabis grown by colleges and universities.
§ 1029. Cannabis growth by colleges and universities.
A college or university in this Commonwealth may grow and
process cannabis for the purpose of offering classes related to
the adult-use cannabis industry either as part of the
department's educational curriculum under Subchapter D (relating
to educational instruction and exam) or for any other class
offered at the college or university. The cannabis grown and
processed for this purpose must be destroyed and may not be used
by any individual. On a form prescribed by the department a
college or university that grows or processes cannabis for this
purpose must report to the department the amount of cannabis
grown or processed and any other information required by the
department.
SUBCHAPTER J
TRACKING SYSTEM
Sec.
1031. Prohibition.
§ 1031. Prohibition.
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The department may not require that a permittee utilize a
seed-to-sale tracking system.
SUBCHAPTER K
ADMINISTRATION AND PENALTIES
Sec.
1032. Enforcement of contracts.
1033. Zoning requirements.
1034. Penalties.
1035. Rules and regulations.
§ 1032. Enforcement of contracts.
The following apply:
(1) Contracts related to the operation of cannabis
establishments under this chapter are enforceable.
(2) Contracts entered into by a permittee, its employees
or agents as permitted pursuant to a valid permit issued by
the department or by those that allow property to be used by
a permittee, its employees or agents as permitted pursuant to
a valid permit issued by the department, may not be deemed
unenforceable on the basis that the actions or conduct
permitted pursuant to the permit are prohibited by Federal
law.
§ 1033. Zoning requirements.
The following apply:
(1) Indoor growers and processors shall meet the same
municipal zoning and land use requirements as other
manufacturing, processing and production facilities that are
located in the same zoning district.
(2) Outdoor growers shall meet the same municipal zoning
and land use requirements as other agricultural facilities
that are located in the same zoning district.
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(3) Dispensaries and use lounges shall meet the same
municipal zoning and land use requirements as other
commercial facilities that are located in the same zoning
district.
§ 1034. Penalties.
(a) Criminal diversion of cannabis by permittee.--In
addition to any other penalty provided by law, a permittee or an
employee, financial backer, operator or principal of a permittee
commits a misdemeanor of the first degree if the person
intentionally, knowingly or recklessly sells, dispenses, trades,
delivers or otherwise provides cannabis to a person that is not
lawfully permitted to receive cannabis.
(b) Criminal diversion of cannabis by nonpermittee.--In
addition to any other penalty provided by law, a person that is
not a permittee or an employee, financial backer, operator or
principal of a permittee commits an offense if the person
intentionally, knowingly or recklessly provides cannabis to a
person that is not lawfully permitted to receive cannabis. The
following shall apply:
(1) A first offense under this subsection constitutes a
misdemeanor of the second degree.
(2) A second or subsequent offense under this subsection
constitutes a misdemeanor of the first degree.
(b.1) Additional criminal offense.--In addition to any other
penalty provided by law, a person commits an offense if the
person intentionally, knowingly or recklessly grows or processes
cannabis in violation of this chapter. The following shall
apply:
(1) A first offense under this subsection constitutes a
summary offense punishable by a fine of not more than $75.
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(2) A second offense under this subsection constitutes a
summary offense punishable by a fine of not more than $500.
(3) A third or subsequent offense constitutes a
misdemeanor of the third degree punishable by a fine of not
more than $5,000, or to imprisonment for not more than three
months.
(c) Additional penalties.--
(1) Except as provided under subsections (a) and (b), in
addition to any other penalty provided by law, a permittee or
an employee, financial backer, operator or principal of any
permittee who violates any of the provisions of or
regulations promulgated under this chapter:
(i) For a first offense, commits a misdemeanor of
the third degree and shall, upon conviction, be sentenced
to pay a fine of not more than $5,000, or to imprisonment
for not more than six months.
(ii) For a second or subsequent offense, commits a
misdemeanor of the third degree and shall, upon
conviction, be sentenced to pay a fine of not more than
$10,000, or to imprisonment for not less than six months
nor more than one year, or both.
(2) Civil penalties.--In addition to any other remedy
available to the department, the department may assess a
civil penalty for a violation of this chapter, regulation
promulgated under this chapter or order issued under this
chapter. The following shall apply:
(i) The department may assess a civil penalty
against a permittee of not more than $10,000 for each
violation and an additional penalty of not more than
$1,000 for each day of a continuing violation.
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(ii) In determining the amount of each civil
penalty, the department shall consider the gravity of the
violation, the potential harm resulting from the
violation to general public, the willfulness of the
violation, previous violations, if any, by the permittee
being assessed and the economic benefit to the permittee
being assessed.
(3) If the department finds that the violation did not
threaten the health or safety of the general public and the
permittee who committed the violation took immediate action
to remedy the violation upon learning of it, the department
may issue a written warning in lieu of assessing a civil
penalty.
(4) A person that aids, abets, counsels, induces,
procures or causes a permittee to violate this chapter, a
regulation promulgated under this chapter or an order issued
under this chapter shall be subject to a civil penalty
provided under this subsection.
(d) Sanctions.--
(1) In addition to the penalties provided under
subsection (c)(2) and any other penalty authorized by law,
the department may impose the following sanctions:
(i) Revoke or suspend the permit of a person found
to be in violation of this chapter, a regulation
promulgated under this chapter or an order issued under
this chapter.
(ii) Revoke or suspend the permit of a person for
conduct or activity or the occurrence of an event that
would disqualify the person from receiving the permit.
(iii) Suspend a permit of a person pending the
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outcome of a hearing in a case in which the permit could
be revoked.
(iv) Order restitution of money or property
unlawfully obtained or retained by a permittee.
(v) Issue a cease and desist order.
(2) A person that aids, abets, counsels, induces,
procures or causes a permittee to violate this chapter, a
regulation promulgated under this chapter or an order issued
under this chapter shall be subject to the sanctions provided
under this subsection.
(e) Costs of action.--The department may assess against a
person determined to be in violation of this chapter, a
regulation promulgated under this chapter or an order issued
under this chapter the costs of investigation of the violation.
(f) Minor violations.--Nothing in this section shall be
construed to require the assessment of a civil penalty or the
imposition of a sanction for a minor violation of this chapter
if the department determines that the public interest will be
adequately served under the circumstances by the issuance of a
written warning.
(g) Other restrictions.--This act shall not permit any
person to engage in or prevent the imposition of any civil,
criminal or other penalty for the following:
(1) Undertaking any task under the influence of cannabis
if doing so would constitute negligence, professional
malpractice or professional misconduct.
(2) Possessing or using cannabis in a State or county
correctional facility, including a facility owned or operated
or under contract with the Department of Corrections or the
county which houses inmates serving a portion of their
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sentences on parole or in other community correction
programs. Nothing in this paragraph shall be construed to
apply to employees of a facility under this paragraph.
§ 1035. Rules and regulations.
(a) Promulgation.--The department shall promulgate rules and
regulations:
(1) Necessary to implement this chapter.
(2) To prevent the sale of cannabis by dispensaries to
consumers that has been grown, processed, packaged or
otherwise produced using chemicals, including pesticides,
that might cause unnecessary harm to a consumer who uses the
cannabis.
(3) To require permittees to report data to the
department no more frequently than quarterly about the amount
of cannabis the permittee has grown, processed, dispensed,
sold, delivered and destroyed.
(b) Definition.--As used in this section, the following
words and phrases shall have the meanings given to them in this
subsection unless the context clearly indicates otherwise:
"Unnecessary harm." Harm that may be prevented through the
use of viable alternative growing, processing, packaging or
production techniques. The term does not include the harm that
is inherent to the use of cannabis.
Section 2. Section 9122 of Title 18 is amended by adding
subsections to read:
§ 9122. Expungement.
* * *
(b.2) Automatic expungement of cannabis-related offenses.--
Within one year of the effective date of this subsection, the
Administrative Office of Pennsylvania Courts and the Board of
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Pardons shall transmit to the Pennsylvania State Police central
repository the criminal history record information of
individuals convicted of cannabis-related offenses or per se
cannabis offenses which occurred on or after the day the
individual attained 21 years of age. Upon receipt of the
criminal history records, the Pennsylvania State Police shall
transmit to the court of common pleas of each county the
criminal history record information for the individuals
convicted of cannabis-related offenses or per se cannabis
offenses in that county and the court shall order the
expungement of those individuals' criminal history records
insofar as they relate to a cannabis-related offense or a per se
cannabis offense.
* * *
(g) Definitions.--As used in this section, the following
words and phrases shall have the meanings given to them in this
subsection unless the context clearly indicates otherwise:
"Cannabis-related offense." A criminal case for which all of
the following apply:
(1) The existence of cannabis in the fact pattern is an
element of the offense applied to the case.
(2) The offender's conduct in committing the offense did
not cause bodily harm to any individual, not including the
offender.
(3) The offender's conduct in committing the offense did
not cause damage to the property of any individual, not
including the offender.
"Per se cannabis offenses." A criminal case for which all of
the following apply:
(1) The existence of cannabis in the fact pattern is an
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element of the offense applied to the case.
(2) The prosecution did not establish beyond a
reasonable doubt that actual impairment caused by cannabis
was the proximate cause of:
(i) bodily harm to any individual, not including the
offender; or
(ii) damage to the property of any individual, not
including the offender.
Section 3. Title 42 is amended by adding a section to read:
§ 9778. Commutation and dismissal of cannabis-related offenses.
(a) Commutation of sentence.--A court of this Commonwealth
or other court of record having jurisdiction shall, after due
hearing, commute the sentence of an individual serving a term of
imprisonment for a cannabis-related offense or per se cannabis
offense on the effective date of this section.
(b) Pending charges.--Notwithstanding any other provision of
law, any charge pending on the effective date of this section
for which the existence of cannabis in the fact pattern is an
element of the offense in question shall be dismissed.
(c) Definitions.---As used in this section, the following
words and phrases shall have the meanings given to them in this
subsection unless the context clearly indicates otherwise:
"Cannabis-related offense." A criminal offense for which the
existence of cannabis is an element.
"Commute." The reduction of the length of a prison or parole
sentence.
Section 4. Repeals are as follows:
(1) Section 4(1)(iii)16 and (iv) of the act of April 14,
1972 (P.L.233, No.64), known as The Controlled Substance,
Drug, Device and Cosmetic Act, are repealed.
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(2) Section 13(a)(30) and (31) of The Controlled
Substance, Drug, Device and Cosmetic Act are repealed insofar
as they are inconsistent with this act.
(3) The act of April 17, 2016 (P.L.84, No.16), known as
the Medical Marijuana Act, is repealed insofar as it is
inconsistent with this act.
(4) All acts and parts of acts are repealed insofar as
they are inconsistent with this act.
Section 5. This act shall take effect in 60 days.
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