Bill Text: CA AB963 | 2017-2018 | Regular Session | Amended
Bill Title: Taxation: marijuana.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Failed) 2018-02-01 - Died on inactive file. [AB963 Detail]
Download: California-2017-AB963-Amended.html
Amended
IN
Assembly
May 30, 2017 |
Amended
IN
Assembly
April 05, 2017 |
Amended
IN
Assembly
March 28, 2017 |
Assembly Bill | No. 963 |
Introduced by Assembly Member Gipson |
February 16, 2017 |
LEGISLATIVE COUNSEL'S DIGEST
(4)The Revenue Recovery and Collaborative Enforcement Team Act, until January 1, 2019, establishes the Revenue Recovery and Collaborative Enforcement Team as a pilot program for combating criminal tax evasion associated with the underground economy, as specified.
Under AUMA, reasonable costs incurred by the board for administering and collecting the taxes imposed by AUMA, as long as those costs do not exceed 4% of tax revenues received, are continuously appropriated to the board from the California Marijuana Tax Fund, as specified.
This bill would require the board to create a Cannabis Criminal Enforcement Team for the purpose of combating criminal tax evasion associated with marijuana, marijuana products, and marijuana accessories with representatives from the board, the Franchise Tax Board, the Employment Development Department, and state licensing authorities under AUMA and the Medical Cannabis Regulation and Safety Act. The bill would
authorize those team members to exchange information for those purposes, would provide for the continued confidentiality of exchanged confidential information, and would prohibit the disclosure of any confidential information received by, or reported to, the team, as specified. The bill would modify the
above-described allocation to the board to include enforcement activity costs incurred by the board through participation in the Cannabis Criminal Enforcement Team as that participation relates to the taxes imposed by AUMA. By expanding the purposes for which the California Marijuana Tax Fund is continuously appropriated, this bill would make an appropriation.
(5)
(6)
Digest Key
Vote: 2/3 Appropriation: YES Fiscal Committee: YES Local Program: YESBill Text
The people of the State of California do enact as follows:
SECTION 1.
Section 6369.6 is added to the Revenue and Taxation Code, to read:6369.6.
(a) There are exempted from the taxes imposed by this part the gross receipts from the sale in this state of, and the storage, use, or other consumption in this state of, medical cannabis, medical cannabis concentrate, edible medical cannabis products, or topical cannabis as those terms are defined in Chapter 3.5 (commencing with Section 19300) of Division 8 of the Business and Professions Code when a person with an identification card or primary caregiver furnishes the seller with both his or her card issued under Section 11362.71 of the Health and Safety Code and a valid government-issued identification card.SEC. 2.
Section 6471.5 is added to the Revenue and Taxation Code, to read:6471.5.
Any person required to make prepayment pursuant to Article 1.7 (commencing with Section 6480.50) may not be required to make additional prepayment pursuant to this article, provided that more than 75 percent of the gross receipts of that person are from the retail sale of marijuana or marijuana products.SEC. 3.
Article 1.7 (commencing with Section 6480.50) is added to Chapter 5 of Part 1 of Division 2 of the Revenue and Taxation Code, to read:Article 1.7. Prepayment of Sales Tax on Marijuana and Marijuana Products
6480.50.
For purposes of the imposition of the prepayment of sales tax on marijuana and marijuana products pursuant to this article:6480.51.
(a) At any time a wholesaler makes a distribution of marijuana or marijuana products in this state to a retailer, the wholesaler shall collect a prepayment of the retail sales tax, in the following manner:6480.52.
(a) If the board determines that it is necessary for the efficient administration of this part, the board may require a wholesaler to provide the board with a list of retailers to which the marijuana or marijuana products were distributed.6480.53.
The wholesaler shall file its prepayment form together with a remittance of the prepayment amounts, if any, required to be collected pursuant to Section 6480.51 payable to the board, on or before the last day of the month following the monthly period to which the prepayment form or each prepayment relates.6480.54.
(a) Any wholesaler that fails to make a timely remittance to the board of the prepayment amounts, if any, required pursuant to Sections 6480.51 and 6480.53 shall also pay a penalty of 10 percent of the amount of the prepayment due but not paid, plus interest at the modified adjusted rate per month, or fraction thereof, established pursuant to Section 6591.5, from the date the prepayment became due and payable to the state until the date of payment.6480.55.
(a) The following persons that have paid prepayment amounts either directly to the board or to the wholesaler from which the marijuana or marijuana products were purchased shall be refunded those amounts:6480.56.
(a) The board may require any wholesaler subject to this article to place with the board any security that the board determines is necessary to ensure compliance with this article. The amount of the security shall be fixed by the board but shall not be greater than three times the estimated average liability of wholesalers required to file returns for monthly periods, determined in any manner that the board deems proper, or five hundred thousand dollars ($500,000), whichever amount is less. These amounts apply regardless of the type of security placed with the board. The amount of the security may be increased or decreased by the board subject to the maximum amounts.6480.57.
A wholesaler that is not required to hold a seller’s permit pursuant to this part shall register with the board on a form prescribed by the board and shall set forth the name under which the wholesaler transacts or intends to transact business, the location of the wholesaler’s place or places of business, and other information as the board may require.6480.58.
This article shall become operative on July 1, 2018.SEC. 4.
Section 6592 of the Revenue and Taxation Code is amended to read:6592.
(a) If the board finds that a person’s failure to make a timely return or payment is due to reasonable cause and circumstances beyond the person’s control, and occurred notwithstanding the exercise of ordinary care and the absence of willful neglect, the person shall be relieved of the penalties provided by Sections 6476, 6477, 6479.3, 6480.4, 6480.8, 6480.54, 6511, 6565, 6591, 7051.2, 7073, and 7074.SEC. 5.
Section 6901 of the Revenue and Taxation Code is amended to read:6901.
If the board determines that any amount, penalty, or interest has been paid more than once or has been erroneously or illegally collected or computed, the board shall set forth that fact in the records of the board and shall certify the amount collected in excess of the amount legally due and the person from whom it was collected or by whom paid. The excess amount collected or paid shall be credited by the board on any amounts then due and payable from the person from whom the excess amount was collected or by whom it was paid under this part, and the balance shall be refunded to the person, or his or her successors, administrators, or executors, if a determination by the board is made in any of the following cases:SEC. 6.
Section 34010 of the Revenue and Taxation Code is amended to read:34010.
For purposes of this part:SEC. 7.
Section 34011 of the Revenue and Taxation Code is amended to read:34011.
(a) Effective January 1, 2018, a marijuana excise tax shall be imposed upon purchasers of marijuana or marijuana products sold in this state at the rate of 15 percent of the gross receipts of any retail sale by a dispensary or other person required to be licensed pursuant to Chapter 3.5 (commencing with Section 19300) of Division 8 of the Business and Professions Code or a retailer, microbusiness, nonprofit, or other person required to be licensed pursuant to Division 10 (commencing with Section 26000) of the Business and Professions Code to sell marijuana and marijuana products directly to a purchaser.SEC. 8.
Section 34011.51 is added to the Revenue and Taxation Code, to read:34011.51.
(a) For purposes of the imposition of the prepayment of marijuana excise tax pursuant to this part:SEC. 9.
Section 34011.52 is added to the Revenue and Taxation Code, to read:34011.52.
(a) If the board determines that it is necessary for the efficient administration of this part, the board may require a wholesaler to provide the board with a list of purchasers to which the marijuana or marijuana products were sold.SEC. 10.
Section 34011.53 is added to the Revenue and Taxation Code, to read:34011.53.
(a) The wholesaler shall file its prepayment form together with a remittance of the prepayment amounts, if any, required to be collected pursuant to Section 34011.51 payable to the State Board of Equalization, on or before the last day of the month following the monthly period to which the prepayment form or each prepayment relates.SEC. 11.
Section 34011.54 is added to the Revenue and Taxation Code, to read:34011.54.
(a) Any wholesaler that fails to make a timely remittance to the board of the prepayment amounts, if any, required pursuant to Sections 34011.51 and 34011.53 shall also pay a penalty of 10 percent of the amount of the prepayment due but not paid, plus interest at the modified adjusted rate per month, or fraction thereof, established pursuant to Section 6591.5, from the date the prepayment became due and payable to the state until the date of payment.SEC. 12.
Section 34011.55 is added to the Revenue and Taxation Code, to read:34011.55.
(a) Any person that has paid prepayment amounts either directly to the board or to the person from which the marijuana or marijuana products were distributed shall be refunded those amounts with respect to marijuana or marijuana products lost through fire, flood, theft, spoilage, or accident, prior to any retail sale.SEC. 13.
Section 34011.56 is added to the Revenue and Taxation Code, to read:34011.56.
(a) The board may require any wholesaler subject to this part to place with the board any security that the board determines is necessary to ensure compliance with this part. The amount of the security shall be fixed by the board but shall not be greater than three times the estimated average liability of wholesalers required to file returns for monthly periods, determined in any manner that the board deems proper, or five hundred thousand dollars ($500,000), whichever amount is less. These amounts apply regardless of the type of security placed with the board. The amount of the security may be increased or decreased by the board subject to the maximum amounts.SEC. 14.
Section 34011.57 is added to the Revenue and Taxation Code, to read:34011.57.
The board may prescribe by regulation a method and manner for prepayment of the marijuana excise tax that utilizes tax stamps or other markings that indicate that all required tax has been paid on the product to which the tax stamp or marking is affixed.SEC. 15.
Section 34012 of the Revenue and Taxation Code is amended to read:34012.
(a) Effective January 1, 2018, there is hereby imposed a cultivation tax on all harvested marijuana that enters the commercial market upon all persons required to be licensed to cultivate marijuana pursuant to Chapter 3.5 (commencing with Section 19300) of Division 8 of the Business and Professions Code or Division 10 (commencing with Section 26000) of the Business and Professions Code. The tax shall be due after the marijuana is harvested.SEC. 16.
Section 34013 of the Revenue and Taxation Code is amended to read:34013.
(a) The board shall administer and collect the taxes imposed by this part pursuant to the Fee Collection Procedures Law (Part 30 (commencing with Section 55001)). For purposes of this part, the references in the Fee Collection Procedures Law to “fee” shall include the tax imposed by this part, and references to “feepayer” shall include a person required to pay or collect the tax imposed by this part.The board shall create a Criminal Cannabis Enforcement Team for the purpose of combating criminal tax evasion associated with marijuana, marijuana products, and marijuana accessories, as those terms are defined in Division 10 (commencing with Section 11000) of the Health and Safety Code, that may include, but not be limited to, representatives from the following:
(a)The board.
(b)The Franchise Tax Board.
(c)Employment Development Department.
(d)State licensing authorities under Chapter 3.5 (commencing with Section 19300) of Division 8 of the Business and Professions
Code or Division 10 (commencing with Section 26000) of the Business and Professions Code.
(a)Duly authorized team members listed in Section 34013.1 may exchange intelligence, data, documents, information, complaints, or lead referrals for the purpose of investigating criminal tax evasion associated with marijuana, marijuana products, and marijuana accessories, as those terms are defined in Division 10 (commencing with Section 11000) of the Health and Safety Code.
(b)Any member or ex-member of the Criminal Cannabis Enforcement Team, any agent employed by any agency listed in Section 34013.1, or any person who has at any time obtained knowledge from any of the foregoing agencies or persons shall not divulge, or make known in any manner not provided by law, any of the confidential information received by, or reported to, the
team. Information exchanged pursuant to this section shall retain its confidential status and shall remain subject to any applicable confidentiality provisions.
SEC. 19.SEC. 17.
Section 34014 of the Revenue and Taxation Code is amended to read:34014.
(a) All persons required to be licensed involved in the cultivation, retail sale, or distribution of marijuana or marijuana products must obtain a separate permit from the board pursuant to regulations adopted by the board. No fee shall be charged to any person for issuance of the permit. Any person required to obtain a permit who engages in business as a cultivator, dispensary, retailer, microbusiness, distributor, or nonprofit pursuant to Chapter 3.5 (commencing with Section 19300) of Division 8 of the Business and Professions Code or Division 10 (commencing with Section 26000) of the Business and Professions Code without a permit or after a permit has been canceled, suspended, or revoked, and each officer of any corporation which so engages in business, is guilty of a misdemeanor.SEC. 20.SEC. 18.
Section 34014.1 is added to the Revenue and Taxation Code, to read:34014.1.
(a) The board shall issue a permit to a cultivator, retailer, or wholesaler upon receipt of a completed application and any security required by the board, unless any of the following apply:SEC. 21.SEC. 19.
Section 34015 of the Revenue and Taxation Code is amended to read:34015.
(a) The marijuana excise tax and cultivation tax imposed by this part is due and payable to the board quarterly on or before the last day of the month following each quarterly period of three months. On or before the last day of the month following each quarterly period, a return for the preceding quarterly period shall be filed with the board by each person required to be licensed for cultivation or retail sale under Chapter 3.5 (commencing with Section 19300) of Division 8 of the Business and Professions Code or Division 10 (commencing with Section 26000) of the Business and Professions Code using electronic media. Returns shall be authenticated in a form or pursuant to methods as may be prescribed by the board. If the cultivation tax is paid by stamp or remitted by the wholesaler pursuant to subdivision (d) of Section 34012 the board may by regulation determine when and how the tax shall be paid.SEC. 22.SEC. 20.
Section 34016 of the Revenue and Taxation Code is amended to read:34016.
(a) Any peace officer or board employee granted limited peace officer status pursuant to paragraph (6) of subdivision (a) of Section 830.11 of the Penal Code, upon presenting appropriate credentials, is authorized to enter any place as described in paragraph (3) and to conduct inspections in accordance with the following paragraphs, inclusive.SEC. 23.SEC. 21.
Section 34016.05 is added to the Revenue and Taxation Code, to read:34016.05.
Any person who fails or refuses to file any report required to be made or who fails or refuses to furnish a supplemental report or other data required by the board is guilty of a misdemeanor and subject to a fine not to exceed one thousand dollars ($1,000) for each offense.SEC. 24.SEC. 22.
Section 34016.1 is added to the Revenue and Taxation Code, to read:34016.1.
(a) Any person who falsely or fraudulently makes, forges, alters, reuses, or counterfeits any evidence of the cultivation tax or marijuana excise tax imposed by this part, or tampers with any metering machine authorized by regulation under this part, or causes or procures to be falsely or fraudulently made, forged, altered, reused, or counterfeited, any such evidence of the cultivation tax or marijuana excise tax or knowingly and willfully utters, publishes, passes, or tenders as genuine any such false, forged, altered, reused, or counterfeited evidence of the cultivation tax or marijuana excise tax, for the purpose of evading the taxes imposed by this part, is guilty of a felony and subject to imprisonment for two, three, or four years, or to a fine of not less than one thousand dollars ($1,000) and not more than twenty-five thousand dollars ($25,000), or to both fine and imprisonment.SEC. 25.SEC. 23.
Section 34016.11 is added to the Revenue and Taxation Code, to read:34016.11.
(a) Any person who knowingly possesses, or keeps, stores, or retains for the purpose of sale, or sells or offers to sell, any marijuana flowers, marijuana leaves, marijuana, marijuana products, and any other product subject to tax under this part to which there is no evidence of the cultivation tax or marijuana excise tax authorized to be made upon secure packaging under this part, or on which tax is due but has not been paid, when those products have been obtained from any source whatever, is guilty of a misdemeanor and shall for each offense be fined an amount not to exceed twenty-five thousand dollars ($25,000), or be imprisoned for a period not to exceed one year in the county jail, or, at the discretion of the court, be subject to both fine and imprisonment in the county jail.SEC. 26.SEC. 24.
Section 34016.12 is added to the Revenue and Taxation Code, to read:34016.12.
If any cultivator, retailer, or wholesaler is convicted under any provision of this part, the board shall revoke all permits issued to that person under the Sales and Use Tax Law (Part 1 (commencing with Section 6001)).SEC. 27.SEC. 25.
Section 34016.13 is added to the Revenue and Taxation Code, to read:34016.13.
Notwithstanding any other provision of this part, any person who violates this part with intent to defeat or evade the determination of an amount due required by law to be made is guilty of a felony when the amount of tax liability aggregates twenty-five thousand dollars ($25,000) or more in any 12-consecutive-month period. The determination shall be approved by the executive director or his or her designee. Each offense shall be punished by a fine of not less than five thousand dollars ($5,000) and not more than twenty thousand dollars ($20,000), or imprisonment for 16 months, two years, or three years, or by both the fine and imprisonment in the discretion of the court.SEC. 28.SEC. 26.
Section 34016.14 is added to the Revenue and Taxation Code, to read:34016.14.
Any person convicted of a crime under this part may be charged the costs of investigation and prosecution at the discretion of the court.SEC. 29.SEC. 27.
Section 34016.15 is added to the Revenue and Taxation Code, to read:34016.15.
(a) (1) Restitution orders or any other amounts imposed by a court of competent jurisdiction for criminal offenses upon a person or any other entity that are due and payable to the board may be collected by the board in any manner provided by law for collection of a delinquent cultivation tax or marijuana excise tax liability, including, but not limited to, issuance of an order and levy under Article 4 (commencing with Section 706.070) of Chapter 5 of Division 2 of Title 9 of Part 2 of the Code of Civil Procedure in the manner provided for earnings withholding orders for taxes.SEC. 30.SEC. 28.
Section 34018 of the Revenue and Taxation Code is amended to read:34018.
(a) The California Marijuana Tax Fund is hereby created in the State Treasury. All taxes, interest, penalties, and other amounts collected and paid, or otherwise remitted, to the board pursuant to this part, less payment of refunds, shall be credited to the Tax Fund.(a)Beginning with fiscal year 2017–2018 the Department of Finance shall estimate revenues to be received pursuant to Sections 34011 and 34012 and provide those estimates to the Controller no later than June 15 of each year. The Controller shall use these estimates when disbursing funds pursuant to this section. Before any funds are disbursed pursuant to subdivisions (b), (c), (d), and (e) of this section, the Controller shall disburse from the Tax Fund to the appropriate account, without regard to fiscal year, the following:
(1)Reasonable costs incurred by the board for administering and collecting the taxes imposed by this part, including enforcement activity costs incurred by
the board through participation in the Cannabis Criminal Enforcement Team as that participation relates to the taxes imposed by this part; provided, however, such costs shall not exceed 4 percent of tax revenues received.
(2)Reasonable costs incurred by the bureau, the Department of Consumer Affairs, the Department of Food and Agriculture, and the State Department of Public Health for implementing, administering, and enforcing Chapter 3.5 (commencing with Section 19300) of Division 8 of the Business and Professions Code and Division 10 (commencing with Section 26000) of the Business and Professions
Code to the extent those costs are not reimbursed pursuant to Section 26180 of the Business and Professions Code or pursuant to Chapter 3.5 (commencing with Section 19300) of Division 8 of the Business and Professions Code. This paragraph shall remain operative through fiscal year 2022–2023.
(3)Reasonable costs incurred by the Department of Fish and Wildlife, the State Water Resources Control Board, and the Department of Pesticide Regulation for carrying out their respective duties under Chapter 3.5 (commencing with Section 19300) of Division 8 or Division 10 (commencing with Section 26000) of the Business and Professions Code to the extent those costs are not otherwise reimbursed.
(4)Reasonable costs incurred by the Controller for performing duties imposed by the Control,
Regulate and Tax Adult Use of Marijuana Act, including the audit required by Section 34020.
(5)Reasonable costs incurred by the State Auditor for conducting the performance audit pursuant to Section 26191 of the Business and Professions Code.
(6)Reasonable costs incurred by the Legislative Analyst’s Office for performing duties imposed by Section 34017.
(7)Sufficient funds to reimburse the Division of Labor Standards Enforcement and the Division of Occupational Safety and Health within the Department of Industrial Relations and the Employment Development Department for the costs of applying and enforcing state labor laws to licensees under Chapter 3.5 (commencing with Section 19300) of Division 8 and Division 10 (commencing
with Section 26000) of the Business and Professions Code.
(b)The Controller shall next disburse the sum of ten million dollars ($10,000,000) to a public university or universities in California annually beginning with fiscal year 2018–2019 until fiscal year 2028–2029 to research and evaluate the implementation and effect of the Control, Regulate and Tax Adult Use of Marijuana Act, and shall, if appropriate, make recommendations to the Legislature and Governor regarding possible amendments to the Control, Regulate and Tax Adult Use of Marijuana Act. The recipients of these funds shall publish reports on their findings at a minimum of every two years and shall make the reports available to the public. The bureau shall select the universities to be funded. The research funded pursuant to this subdivision shall include but not necessarily
be limited to:
(1)Impacts on public health, including health costs associated with marijuana use, as well as whether marijuana use is associated with an increase or decrease in use of alcohol or other drugs.
(2)The impact of treatment for maladaptive marijuana use and the effectiveness of different treatment programs.
(3)Public safety issues related to marijuana use, including studying the effectiveness of the packaging and labeling requirements and advertising and marketing restrictions contained in the act at preventing underage access to and use of marijuana and marijuana products, and studying the health-related effects among users of varying potency levels of marijuana and marijuana products.
(4)Marijuana use rates, maladaptive use rates for adults and youth, and diagnosis rates of marijuana-related substance use disorders.
(5)Marijuana market prices, illicit market prices, tax structures and rates, including an evaluation of how to best tax marijuana based on potency, and the structure and function of licensed marijuana businesses.
(6)Whether additional protections are needed to prevent unlawful monopolies or anti-competitive behavior from occurring in the nonmedical marijuana industry and, if so, recommendations as to the most effective measures for preventing such behavior.
(7)The economic impacts in the private and public sectors, including,
but not necessarily limited to, job creation, workplace safety, revenues, taxes generated for state and local budgets, and criminal justice impacts, including, but not necessarily limited to, impacts on law enforcement and public resources, short and long term consequences of involvement in the criminal justice system, and state and local government agency administrative costs and revenue.
(8)Whether the regulatory agencies tasked with implementing and enforcing the Control, Regulate and Tax Adult Use of Marijuana Act are doing so consistent with the purposes of the act, and whether different agencies might do so more effectively.
(9)Environmental issues related to marijuana production and the criminal prohibition of marijuana production.
(10)The geographic location, structure, and function of licensed marijuana businesses, and demographic data, including race, ethnicity, and gender, of license holders.
(11)The outcomes achieved by the changes in criminal penalties made under the Control, Regulate and Tax Adult Use of Marijuana Act for marijuana-related offenses, and the outcomes of the juvenile justice system, in particular, probation-based treatments and the frequency of up-charging illegal possession of marijuana or marijuana products to a more serious offense.
(c)The Controller shall next disburse the sum of three million dollars ($3,000,000) annually to the Department of the California Highway Patrol beginning fiscal year 2018–2019 until fiscal year 2022–2023 to establish and adopt protocols to
determine whether a driver is operating a vehicle while impaired, including impairment by the use of marijuana or marijuana products, and to establish and adopt protocols setting forth best practices to assist law enforcement agencies. The department may hire personnel to establish the protocols specified in this subdivision. In addition, the department may make grants to public and private research institutions for the purpose of developing technology for determining when a driver is operating a vehicle while impaired, including impairment by the use of marijuana or marijuana products.
(d)The Controller shall next disburse the sum of ten million dollars ($10,000,000) beginning fiscal year 2018–2019 and increasing ten million dollars ($10,000,000) each fiscal year thereafter until fiscal year 2022–2023, at which time the disbursement
shall be fifty million dollars ($50,000,000) each year thereafter, to the Governor’s Office of Business and Economic Development, in consultation with the Labor and Workforce Development Agency and the State Department of Social Services, to administer a community reinvestments grants program to local health departments and at least 50 percent to qualified community-based nonprofit organizations to support job placement, mental health treatment, substance use disorder treatment, system navigation services, legal services to address barriers to reentry, and linkages to medical care for communities disproportionately affected by past federal and state drug policies. The office shall solicit input from community-based job skills, job placement, and legal service providers with relevant expertise as to the administration of the grants program. In addition, the office shall periodically evaluate the
programs it is funding to determine the effectiveness of the programs, shall not spend more than 4 percent for administrative costs related to implementation, evaluation and oversight of the programs, and shall award grants annually, beginning no later than January 1, 2020.
(e)The Controller shall next disburse the sum of two million dollars ($2,000,000) annually to the University of California San Diego Center for Medicinal Cannabis Research to further the objectives of the center including the enhanced understanding of the efficacy and adverse effects of marijuana as a pharmacological agent.
(f)By July 15 of each fiscal year beginning in fiscal year 2018–2019, the Controller shall, after disbursing funds pursuant to subdivisions (a), (b), (c), (d), and (e), disburse funds
deposited in the Tax Fund during the prior fiscal year into sub-trust accounts, which are hereby created, as follows:
(1)Sixty percent shall be deposited in the Youth Education,
Prevention, Early Intervention and Treatment Account, and disbursed by the Controller to the State Department of Health Care Services for programs for youth that are designed to educate about and to prevent substance use disorders and to prevent harm from substance use. The State Department of Health Care Services shall enter into interagency agreements with the State Department of Public Health and the State Department of Education to implement and administer these programs. The programs shall emphasize accurate education, effective prevention, early intervention, school retention, and timely treatment services for youth, their families and caregivers. The programs may include, but are not limited to, the following components:
(A)Prevention and early intervention services including outreach, risk survey and education to
youth, families, caregivers, schools, primary care health providers, behavioral health and substance use disorder service providers, community and faith-based organizations, fostercare providers, juvenile and family courts, and others to recognize and reduce risks related to substance use, and the early signs of problematic use and of substance use disorders.
(B)Grants to schools to develop and support student assistance programs, or other similar programs, designed to prevent and reduce substance use, and improve school retention and performance, by supporting students who are at risk of dropping out of school and promoting alternatives to suspension or expulsion that focus on school retention, remediation, and professional care. Schools with higher than average dropout rates should be prioritized for grants.
(C)Grants to programs for outreach, education and treatment for homeless youth and out-of-school youth with substance use disorders.
(D)Access and linkage to care provided by county behavioral health programs for youth, and their families and caregivers, who have a substance use disorder or who are at risk for developing a substance use disorder.
(E)Youth-focused substance use disorder treatment programs that are culturally and gender competent, trauma-informed, evidence-based and provide a continuum of care that includes screening and assessment (substance use disorder as well as mental health), early intervention, active treatment, family involvement, case management, overdose prevention, prevention of communicable
diseases related to substance use, relapse management for substance use and other co-occurring behavioral health disorders, vocational services, literacy services, parenting classes, family therapy and counseling services, medication-assisted treatments, psychiatric medication and psychotherapy. When indicated, referrals must be made to other providers.
(F)To the extent permitted by law and where indicated, interventions shall utilize a two-generation approach to addressing substance use disorders with the capacity to treat youth and adults together. This would include supporting the development of family-based interventions that address substance use disorders and related problems within the context of families, including parents, foster parents, caregivers and all their children.
(G)Programs to assist individuals, as well as families and friends of drug using young people, to reduce the stigma associated with substance use including being diagnosed with a substance use disorder or seeking substance use disorder services. This includes peer-run outreach and education to reduce stigma, anti-stigma campaigns, and community recovery networks.
(H)Workforce training and wage structures that increase the hiring pool of behavioral health staff with substance use disorder prevention and treatment expertise. Provide ongoing education and coaching that increases substance use treatment providers’ core competencies and trains providers on promising and evidenced-based practices.
(I)Construction of community-based youth treatment facilities.
(J)The departments may contract with each county behavioral health program for the provision of services.
(K)Funds shall be allocated to counties based on demonstrated need, including the number of youth in the county, the prevalence of substance use disorders among adults, and confirmed through statistical data, validated assessments or submitted reports prepared by the applicable county to demonstrate and validate need.
(L)The departments shall periodically evaluate the programs they are funding to determine the effectiveness of the programs.
(M)The departments may use up to 4 percent of the moneys allocated to the Youth Education, Prevention, Early Intervention and
Treatment Account for administrative costs related to implementation, evaluation and oversight of the programs.
(N)If the Department of Finance ever determines that funding pursuant to marijuana taxation exceeds demand for youth prevention and treatment services in the state, the departments shall provide a plan to the Department of Finance to provide treatment services to adults as well as youth using these funds.
(O)The departments shall solicit input from volunteer health
organizations, physicians who treat addiction, treatment researchers, family therapy and counseling providers, and professional education associations with relevant expertise as to the administration of any grants made pursuant to this paragraph.
(2)Twenty percent shall be deposited in the Environmental Restoration and Protection Account, and disbursed by the Controller as follows:
(A)To the Department of Fish and Wildlife and the Department of Parks and Recreation for the cleanup, remediation, and restoration of environmental damage in watersheds affected by marijuana cultivation and related activities including, but not limited to, damage that occurred prior to enactment of this part, and to support local partnerships for this purpose. The Department of Fish and
Wildlife and the Department of Parks and Recreation may distribute a portion of the funds they receive from the
Environmental Restoration and Protection Account through grants for purposes specified in this paragraph.
(B)To the Department of Fish and Wildlife and the Department of Parks and Recreation for the stewardship and operation of state-owned wildlife habitat areas and state park units in a manner that discourages and prevents the illegal cultivation, production, sale and use of marijuana and marijuana products on public lands, and to facilitate the investigation, enforcement and prosecution of illegal cultivation, production, sale, and use of marijuana or marijuana products on public lands.
(C)To the Department of Fish and Wildlife to assist in funding the watershed enforcement program and multiagency taskforce established pursuant to subdivisions (b) and (c) of
Section 12029 of the Fish and Game Code to facilitate the investigation, enforcement, and prosecution of these offenses and to ensure the reduction of adverse impacts of marijuana cultivation, production, sale, and use on fish and wildlife habitats throughout the state.
(D)For purposes of this paragraph, the Secretary of the Natural Resources Agency shall determine the allocation of revenues between the departments. During the first five years of implementation, first consideration should be given to funding purposes specified in subparagraph (A).
(E)Funds allocated pursuant to this paragraph shall be used to increase and enhance activities described in subparagraphs (A), (B), and (C), and not replace allocation of other funding for these purposes. Accordingly, annual
General Fund appropriations to the Department of Fish and Wildlife and the Department of Parks and Recreation shall not be reduced below the levels provided in the Budget Act of 2014 (Chapter 25 of the Statutes of 2014).
(3)Twenty percent shall be deposited into the State and Local Government Law Enforcement Account and disbursed by the Controller as follows:
(A)To the Department of the California Highway Patrol for conducting training programs for detecting, testing and enforcing laws against driving under the influence of alcohol and other drugs, including driving under the influence of marijuana. The department may hire personnel to conduct the training programs specified in this subparagraph.
(B)To the Department
of the California Highway Patrol to fund internal California Highway Patrol programs and grants to qualified nonprofit organizations and local governments for education, prevention and enforcement of laws related to driving under the influence of alcohol and other drugs, including marijuana; programs that help enforce traffic laws, educate the public in traffic safety, provide varied and effective means of reducing fatalities, injuries and economic losses from collisions; and for the purchase of equipment related to enforcement of laws related to driving under the influence of alcohol and other drugs, including marijuana.
(C)To the Board of State and Community Corrections for making grants to local governments to assist with law enforcement, fire protection, or other local programs addressing public health and safety associated with the
implementation of the Control, Regulate and Tax Adult Use of Marijuana Act. The board shall not make any grants to local governments which have banned the cultivation, including personal cultivation under paragraph (3) of subdivision (b) of Section 11362.2 of the Health and Safety Code, or retail sale of marijuana or marijuana products pursuant to Section 26200 of the Business and Professions Code or as otherwise provided by law.
(D)For purposes of this paragraph, the Department of Finance shall determine the allocation of revenues between the agencies; provided, however, beginning in fiscal year 2022–2023 the amount allocated pursuant to subparagraph (A) shall not be less than ten million dollars ($10,000,000) annually and the amount allocated pursuant to subparagraph (B) shall not be less than forty million dollars
($40,000,000) annually. In determining the amount to be allocated before fiscal year 2022–2023 pursuant to this paragraph, the Department of Finance shall give initial priority to subparagraph (A).
(g)Funds allocated pursuant to subdivision (f) shall be used to increase the funding of programs and purposes identified and shall not be used to replace allocation of other funding for these purposes.
(h)Effective July 1, 2028, the Legislature may amend this section by majority vote to further the purposes of the Control, Regulate and Tax Adult Use of Marijuana Act, including allocating funds to programs other than those specified in subdivisions (d) and (f). Any revisions pursuant to this subdivision shall not result in a reduction of funds to accounts established pursuant to subdivisions
(d) and (f) in any subsequent year from the amount allocated to each account in fiscal year 2027–2028. Prior to July 1, 2028, the Legislature may not change the allocations to programs specified in subdivisions (d) and (f).