2021 -- H 6370

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LC002923

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2021

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A N   A C T

RELATING TO FOOD AND DRUGS -- ADULT USE MARIJUANA

     Introduced By: Representatives Slater, O'Brien, Amore, Solomon, Kazarian, Alzate,
Hull, Potter, Morales, and Giraldo

     Date Introduced: May 28, 2021

     Referred To: House Finance

     It is enacted by the General Assembly as follows:

     SECTION 1. Title 21 of the General Laws entitled "FOOD AND DRUGS" is hereby

amended by adding thereto the following chapter:

CHAPTER 28.11

ADULT USE MARIJUANA ACT

     21-28.11-1. Short title.

     This chapter shall be known and may be cited as the "Adult Use Marijuana Act".

     21-28.11-2. Legislative intent.

     It is the intent of the general assembly in enacting this chapter to do the following:

     (1) To regulate marijuana in order to more effectively limit minors' access to marijuana.

     (2) To reduce criminal activity and violence associated with illegal marijuana cultivation,

smuggling and sale.

     (3) To provide for public health and safety.

     (4) To raise funds to address and discourage substance abuse, to encourage social justice

and support drug education and awareness.

     21-28.11-3. Definitions.

     For purposes of this chapter, the following words, terms and phrases shall have the

following meanings:

     (1) "Cannabinoid" means any of several compounds produced by cannabis plants that have

medical and psychotropic effects.

     (2) "Cannabinoid profile" means amounts, expressed as the dry-weight percentages, of

delta-9-tetrahydrocannabinol, cannabidiol, tetrehydrocannabinolic acid and cannabidiolic acid in a

cannabis product. Amounts of other cannabinoids may be required by the commission.

     (3) "Cannabis" or "Marijuana" has the same meaning as "Cannabis" as set forth in § 21-

28.6-3.

     (4) "Close associate" means a person who holds a legally recognized financial interest in,

or is entitled to exercise power in, the business of an applicant or licensee and, by virtue of that

interest or power, is able to exercise a significant influence over the management or operation of a

cannabis establishment licensed under this chapter.

     (5) "Consumer" means a person who is at least twenty-one (21) years of age.

     (6) "Controlling person" means an officer, board member or other individual who has a

financial or voting interest of ten percent (10%) or greater in a marijuana establishment.

     (7) "Cultivation batch" means a collection of marijuana plants from the same seed or plant

stock that are cultivated and harvested together, and receive an identical propagation and cultivation

treatment, including, but not limited to: growing media, ambient conditions, watering and light

regimes and agricultural or hydroponic inputs. The marijuana cultivator licensee shall assign and

record a unique, sequential alphanumeric identifier to each cultivation batch for the purposes of

production tracking, product labeling and product recalls.

     (8) "Department" means the department of business regulation.

     (9) "Director" means the director of the department of business regulation.

     (10) "Finished marijuana" means a usable marijuana or cannabis, marijuana or cannabis

resin or marijuana or cannabis concentrate.

     (11) "Hemp" means the plant of the genus cannabis or any part of the plant, whether

growing or not, with a delta-9-tetrahydrocannabinol concentration that does not exceed three tenths

of one percent (0.3%) on a dry weight basis of any part of the plant of the genus cannabis, or per

volume or weight of cannabis product, or the combined percent of delta-9-tetrahydrocannabinol

and tetrahydrocannabinolic acid in any part of the plant of the genus cannabis regardless of moisture

content.

     (12) "Host community" means a municipality in which a marijuana establishment or a

medical marijuana treatment center is located or in which an applicant has proposed locating a

marijuana establishment or a medical marijuana treatment center.

     (13) "Hybrid marijuana cultivator" means an entity that holds a medical marijuana

cultivator license pursuant to chapter 28.6 of this title and that also holds a license to cultivate

marijuana pursuant to chapter 28.11 of this title and in accordance with regulations promulgated

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by the department of business regulation.

     (14) "Hybrid marijuana retailer" means an entity that holds a medical marijuana

compassion center license pursuant to chapter 28.6 of this title and that also holds a license to sell

marijuana at retail pursuant to chapter 28.11 of this title and in accordance with regulations

promulgated by the department of business regulation.

     (15) "Independent testing laboratory" means a laboratory that is licensed by the department

and is:

     (i) Accredited to the most current International Organization for Standardization 17025 by

a third-party accrediting body that is a signatory to the International Laboratory Accreditation

Cooperation mutual recognition arrangement or that is otherwise approved by the department;

     (ii) Independent financially from any medical marijuana treatment center or any licensee

or marijuana establishment for which it conducts a test; and

     (iii) Qualified to test marijuana in compliance with regulations promulgated by the

department pursuant to this chapter. The term includes, but is not limited to, an independent testing

laboratory as provided in § 21-28.11-11.

     (16) "Laboratory agent" means an employee of an independent testing laboratory who

transports, possesses or tests marijuana.

     (17) "Licensee" means a person or entity licensed by the department pursuant to the

provisions of this chapter. Any business structure recognized pursuant to the provisions of title 7,

including, but not limited to,, corporations, partnerships, limited partnerships, limited-liability

companies, and workers' cooperatives, which is otherwise qualified, is eligible to be considered by

the department as an entity licensee.

     (18) "Manufacture" means to compound, blend, extract, infuse or otherwise make or

prepare a marijuana product.

     (19) "Marijuana" or "Marihuana" or "Cannabis" means all parts of any plant of the genus

cannabis, not excepted below and whether growing or not; the seeds thereof; and resin extracted

from any part of the plant; and every compound, manufacture, salt, derivative, mixture or

preparation of the plant, its seeds or resin including tetrahydrocannabinol; provided, however, that

"marijuana" shall not include:

     (i) The mature stalks of the plant, fiber produced from the stalks, oil, or cake made from

the seeds of the plant, any other compound, manufacture, salt, derivative, mixture or preparation of

the mature stalks, fiber, oil or cake made from the seeds of the plant or the sterilized seed of the

plant that is incapable of germination;

     (ii) Hemp; or

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     (iii) The weight of any other ingredient combined with marijuana to prepare topical or oral

administrations, food, drink or other products.

     (20) "Marijuana accessories" means equipment, products, devices or materials of any kind

that are intended or designed for use in planting, propagating, cultivating, growing, harvesting,

manufacturing, compounding, converting, producing, processing, preparing, testing, analyzing,

packaging, repackaging, storing, containing, ingesting, inhaling or otherwise introducing marijuana

into the human body.

     (21) "Marijuana cultivator" means an entity licensed to cultivate, process and package

marijuana, to deliver marijuana to marijuana establishments and to transfer marijuana to other

marijuana establishments, but not to consumers.

     (22) "Marijuana establishment" means a marijuana cultivator, independent testing

laboratory, marijuana product manufacturer, marijuana retailer or any other type of licensed

marijuana related business.

     (23) "Marijuana product manufacturer" means an entity licensed to obtain, manufacture,

process and package marijuana and marijuana products, to deliver marijuana and marijuana

products to marijuana establishments and to transfer marijuana and marijuana products to other

marijuana establishments, but not to consumers.

     (24) "Marijuana products" means products that have been manufactured and contain

marijuana or an extract from marijuana, including concentrated forms of marijuana and products

composed of marijuana and other ingredients that are intended for use or consumption, including

edible products, beverages, topical products, ointments, oils and tinctures.

     (25) "Marijuana retailer" means an entity licensed to purchase and deliver marijuana and

marijuana products from marijuana establishments and to deliver, sell or otherwise transfer

marijuana and marijuana products to marijuana establishments and to consumers.

     (26) "Medical marijuana treatment center" includes a compassion center as defined in §

21-28.6-3.

     (27) "Mycotoxin" means a secondary metabolite of a microfungus that is capable of

causing death or illness in humans and other animals. For the purposes of this chapter, mycotoxin

shall include alfatoxin B1, alfatoxin B2, alfatoxin G1, alfatoxin G2 and ochratoxin A.

     (28) "Process" or "processing" means to harvest, dry, cure, trim and separate parts of the

cannabis plant by manual or mechanical means, except it shall not include manufacture as defined

in this section.

     (29) "Production batch" means a batch of finished plant material, marijuana resin,

marijuana concentrate or marijuana infused product made at the same time, using the same

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methods, equipment and ingredients. The licensee shall assign and record a unique, sequential

alphanumeric identifier to each production batch for the purposes of production tracking, product

labeling and product recalls. All production batches shall be traceable to one or more marijuana

cultivation batches.

     (30) "Residual solvent" means a volatile organic chemical used in the manufacture of a

marijuana product and that is not completely removed by practical manufacturing techniques.

     (31) "Terpenoid" means an isoprene that are the aromatic compounds found in marijuana,

including, but not limited to: limonene, myrcene, pinene, linalool, eucalyptol, Δ-terpinene, ß-

caryophyllene, caryophyllene oxide, nerolidol and phytol.

     (32) "Unreasonable and impracticable" means that the measures necessary to comply with

the rules or regulations adopted pursuant to this chapter subject licensees to unreasonable risk or

require such a high investment of risk, money, time or any other resource or asset that a reasonably

prudent businessperson would not operate a marijuana establishment.

     21-28.11-4. Duties of the director.

     The director of the department of business regulation shall have the duty to supervise,

control, develop, and implement rules, regulations and procedures to effectuate, administer and

carry out the purpose of this chapter.

     21-28.11-5. Powers of the director.

     (a) The director shall have all the powers necessary to carry out and effectuate the purpose

of this chapter including, but not limited to, the power to:

     (1) Appoint officers and employees to perform the duties necessary to carry out the purpose

of this chapter;

     (2) Establish and amend a plan of organization that the director considers expedient;

     (3) Execute all instruments necessary for accomplishing the purposes of this chapter;

     (4) Enter into agreements or other transactions with a person, including, but not limited to,

a public entity or other governmental instrumentality or authority in connection with the director's

powers and duties under this chapter;

     (5) Appear before boards, commissions, departments or other agencies of municipal, state

or federal government;

     (6) Apply for and accept subventions, grants, loans, advances and contributions of money,

property, labor or other things of value from any source, to be held, used and applied for its

purposes;

     (7) Provide and pay for advisory services and technical assistance as may be necessary in

the judgment of the director to carry out the purpose and intent of this chapter and fix the

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compensation of persons providing such services or assistance;

     (8) Prepare, publish and distribute, with or without charge as the director may determine,

such studies, reports, bulletins and other materials as the director considers appropriate;

     (9) Require an applicant for licensure under this chapter to apply for such licensure and

approve or disapprove any such application or other transactions, events and processes as provided

in this chapter;

     (10) Determine which applicants shall be awarded licenses;

     (11) Deny an application or limit, condition, restrict, revoke or suspend a license;

     (12) Establish a registration process, based on finding of suitability or approval of

licensure;

     (13) Conduct and administer procedures and hearings in compliance with chapter 35 of

title 42 ("administrative procedures"), for adoption of rules or regulations, issuance, denial or

revocation of licenses or permits; or for violation of the provisions of this chapter or the rules and

regulations adopted pursuant to the provisions of this chapter. The director may impose a civil

penalty of not more than five thousand dollars ($5,000) and a suspension or revocation of any

license for a violation of the provisions of this chapter or the rules and/or regulations promulgated

pursuant to the provisions of this chapter;

     (14) Conduct fact finding and investigate information applicable to the director's obligation

to issue, suspend or revoke licenses, registrations, or finding of suitability or approval of licensure

for:

     (i) A violation of this chapter or any rule or regulation adopted by the director;

     (ii) Willfully violating an order of the director directed to a licensee or a person required

to be registered;

     (iii) The conviction of a disqualifying criminal offense pursuant to § 21-28.11-12.1; or

     (iv) Any other offense which would disqualify such a licensee from holding a license;

     (15) Conduct investigations into the qualifications of all applicants for employment by the

director and all applicants for licensure;

     (16) Receive from the state police, the department of attorney general or other criminal

justice agencies including, but not limited to, the Federal Bureau of Investigation and the Internal

Revenue Service, such criminal offender record information relating to criminal and background

investigations as necessary for the purpose of evaluating licensees, applicants for license, and lab

agents;

     (17) Be present, through its inspectors and agents, at any time, in marijuana establishments

for the purposes of exercising the director's oversight responsibilities;

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     (18) Inspect and have access to all equipment and supplies in a marijuana establishment;

     (19) Seize and remove from the premises of a marijuana establishment and impound any

marijuana, equipment, supplies, documents and records obtained or possessed in violation of this

chapter for the purpose of examination and inspection;

     (20) For cause, demand access to and inspect all papers, books and records of close

associates of a licensee whom the director suspects is involved in the financing, operation or

management of the licensee; provided, however, that the inspection, examination, photocopying

and audit may take place on the affiliate's premises or elsewhere as practicable and in the presence

of the affiliate or its agent;

     (21) Require that the books and financials or other records or statements of a licensee be

kept in a manner that the director considers proper;

     (22) Impose fees and civil penalties, as authorized by this chapter, and impose civil

penalties and sanctions for a violation of any rule or regulation promulgated by the director;

     (23) Collect fees and civil penalties pursuant to the provisions of this chapter;

     (24) Conduct adjudicatory proceedings and promulgate regulations;

     (25) Refer cases for criminal prosecution to the appropriate federal, state or local

authorities;

     (26) Maintain an official Internet website for the department;

     (27) Monitor any federal activity regarding marijuana; and

     (28) Adopt, amend or repeal rules and regulations for the implementation, administration

and enforcement of this chapter.

     (b) The director shall, adopt rules and regulations consistent with this chapter for the

administration, clarification and enforcement of provisions regulating and licensing marijuana

establishments. The rules and regulations shall include, but not be limited to:

     (1) Methods and forms of application which an applicant for a license shall follow and

complete before consideration by the director;

     (2) For any fees not otherwise specified in this chapter, a schedule of application, license

and renewal fees in an amount necessary to pay for all regulation and enforcement costs of the

department; provided, however, that fees may be relative to the volume of business conducted or

to be conducted by the marijuana establishment;

     (3) Qualifications for licensure and minimum standards for employment that are directly

and demonstrably related to the operation of a marijuana establishment and similar to qualifications

for licensure and employment standards in connection with the manufacture, distribution or sale of

alcoholic beverages as regulated under title 3; provided, that a prior conviction solely for a

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marijuana-related offense shall not automatically disqualify an individual or otherwise affect

eligibility for employment or licensure in connection with a marijuana establishment, unless the

offense involved the distribution of a controlled substance, including marijuana, to a minor;

     (4) Procedures and policies to promote and encourage participation in the regulated

marijuana industry by people from communities that have previously been disproportionately

harmed by marijuana prohibition and enforcement and to positively impact those communities;

     (5) Standards for the licensure of marijuana establishments, to include, but not be limited

to, utilization of the social equity assistance fund established pursuant to the provisions of § 21-

28.11-31;

     (6) Standards for the reporting or payment of licensure fees and taxes;

     (7) Requirements for the information to be furnished by an applicant or licensee;

     (8) Criteria for evaluation of the application for a license;

     (9) Requirements for the information to be furnished by a licensee to the licensee's

employees;

     (10) Requirements for fingerprinting or other method of identification of an applicant for

a license or a licensee;

     (11) Procedures and grounds for the revocation or suspension of a license or registration;

     (12) Minimum uniform standards of accounting procedures;

     (13) Requirements for record keeping by marijuana establishments and procedures to track

marijuana cultivated, processed, manufactured, delivered or sold by marijuana establishments;

     (14) Any necessary registration requirements for employees working at the marijuana

establishment;

     (15) Requirements that all marijuana establishment employees be properly trained in their

respective professions as necessary;

     (16) Procedures for the authorization of a marijuana establishment under this chapter;

     (17) Minimum standards for the requirement that all licensees possess and operate an

interoperable publicly available application programming interface seed-to-sale tracking system

sufficient to ensure the appropriate track and trace of all marijuana cultivated, processed or

manufactured pursuant to this chapter;

     (18) Minimum security requirements for licensees sufficient to deter and prevent theft and

unauthorized entrance into areas containing marijuana, which may include, but not be limited to,

the use of security personnel, security cameras, or alarms; provided, that the requirements shall not

prohibit the cultivation of marijuana outdoors or in greenhouses;

     (19) Minimum standards for liability insurance coverage or requirements that a certain

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monetary sum be placed in escrow to be expended for potential liabilities;

     (20) Requirements and standards sufficient to ensure for the virtual separation of marijuana

cultivated, processed, manufactured, delivered or sold by a licensee that is also licensed as a

medical marijuana treatment center pursuant to the provisions of chapter 28.6 of title 21.

Requirements shall leverage seed-to-sale tracking technology;

     (21) Requirements and procedures to prevent the sale, delivery or transfer of marijuana to

persons under twenty-one (21) years of age, or the purchase of marijuana on behalf of a person

under twenty-one (21) years of age, including a prohibition on persons under twenty-one (21)

entering marijuana establishments;

     (22) Standards for manufacturing or extracting cannabinoid oils or butane hash oil;

     (23) Health and safety standards, established in consultation with the department of health

and the department of environmental management, for the cultivation, processing, manufacturing

and distribution of marijuana, including standards regarding sanitation for the preparation, storage,

handling and sale of food products, including compliance with state sanitation requirements, and

health inspections; provided, however, that the authority to promulgate regulations pertaining to

the use of pesticides shall remain with the department of environmental management pursuant to

the provisions of chapter 25 of title 23;

     (24) Requirements for the packaging of marijuana and marijuana products that shall, at a

minimum:

     (i) Require the most current consumer product safety commission standards, set forth in 16

C.F.R. 1700 et seq.;

     (ii) Protect children from accidently ingesting marijuana or marijuana products, including

by making packaging certified child-resistant and resealable;

     (iii) Require the separation of each serving within a package containing multiple servings

shall be furnished in a manner that allows consumers and card holders to easily identify a single

serving;

     (iv) Prohibit the use of bright colors, cartoon characters and other features designed to

appeal to minors;

     (v) Ensure that packaging is opaque or plain in design;

     (vi) Limit each serving size to no greater than ten milligrams (10 mg) of delta-9-

tetrahydrocannabinol (Δ9-THC); and

     (vii) Prohibit any packaging that imitates or has a semblance to any existing branded

consumer products, including foods and beverages that do not contain cannabis;

     (25) Requirements for the potency or dosing limitations of edible marijuana products sold

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by licensees;

     (26) Requirements for the labeling of a package containing marijuana or marijuana

products that shall, at a minimum, include:

     (i) A symbol or other easily recognizable mark issued by the department that indicates the

package contains marijuana or a marijuana product;

     (ii) A symbol or other easily recognizable mark issued by the department on the package

indicating to children that the product is harmful to children;

     (iii) The name and contact information of the marijuana cultivator or the marijuana product

manufacturer who produced the marijuana or marijuana product, and a symbol or other easily

recognizable mark identifying the marijuana cultivator or manufacturer;

     (iv) The results of sampling, testing and analysis conducted by a licensed independent

testing laboratory;

     (v) A seal certifying the marijuana meets such testing standards;

     (vi) A unique batch number identifying the production batch associated with

manufacturing, processing, and cultivating;

     (vii) A list of ingredients and possible allergens;

     (viii) The amount of delta-9-tetrahydrocannabinol (Δ9-THC) in the package and in each

serving of a marijuana product as expressed in absolute terms and as a percentage of volume;

     (ix) The number of servings in a package if there are multiple servings;

     (x) A use-by date, if applicable; and

     (xi) The following statement, including capitalization: "This product has not been analyzed

or approved by the FDA. There is limited information on the side effects of using this product, and

there may be associated health risks. Marijuana use during pregnancy and breast-feeding may pose

potential harm. It is against the law to drive or operate machinery when under the influence of this

product. KEEP THIS PRODUCT AWAY FROM CHILDREN.";

     (27) Procedures and policies, in cooperation with the department of environmental

management, subject to the provisions of §§ 21-28.11-7 and 21-28.11-8, to regulate the manner of

cultivation by farmers and businesses to include limitations on ownership interests in a marijuana

cultivator cooperative.

     (28) Requirements for the safe disposal of excess, contaminated, adulterated or deteriorated

marijuana, which shall consider policies which promote the recycling of such waste, including, but

not limited to, recycled industrial products;

     (29) Requirements for advertising, marketing and branding of marijuana and marijuana

products that shall, at a minimum, include, but shall not be limited to:

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     (i) A prohibition on advertising, marketing and branding in such a manner that is deemed

to be deceptive, false or misleading;

     (ii) A prohibition on advertising, marketing and branding by means of television, radio,

Internet, unless at least eight-five percent (85%) of the audience is reasonably expected to be

twenty-one (21) years of age or older, as determined by reliable, up-to-date audience composition

data;

     (iii) A prohibition on advertising, marketing and branding that utilizes statements, designs,

representations, pictures or illustrations that portray anyone less than twenty-one (21) years of age;

     (iv) A prohibition on advertising, marketing and branding including, but not limited to,

mascots, cartoons, brand sponsorships and celebrity endorsements, that is deemed to appeal to a

person less than twenty-one (21) years of age;

     (v) A prohibition on advertising, marketing and branding, including statements by a

licensee, that makes any false or misleading statements concerning other licensees and the conduct

and products of such other licensees;

     (vi) A prohibition on advertising, marketing and branding through certain identified

promotional items as determined by the director, including giveaways, coupons or "free" or

"donated" marijuana;

     (vii) A prohibition on advertising, marketing and branding by a licensee that asserts its

products are safe, other than labeling required pursuant to this chapter;

     (viii) A prohibition of the use of vehicles equipped with radio or loud speakers for the

advertising of marijuana;

     (ix) An allowance that a licensee may sponsor a charitable, sporting or similar event, but a

prohibition of advertising, marketing and branding at, or in connection with, such an event unless

at least eight-five percent (85%) of the audience is reasonably expected to be twenty-one (21) years

of age or older, as determined by reliable, up-to-date audience composition data;

     (x) A requirement that the website of a marijuana establishment shall verify that the entrant

is at least twenty-one (21) years of age;

     (xi) A prohibition on the use of unsolicited pop-up advertisements on the Internet; and

     (xii) A requirement that all advertising, marketing or branding materials for marijuana and

marijuana products contain a standard health warning developed by the department of health;

     (30) Procedures and requirements to enable the transfer of a license for a marijuana

establishment to another qualified person or to another suitable location with notification and

approval by the director;

     (31) Requirements to establish a process allowing the director to order a prohibition on the

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sale of a marijuana product found especially appealing to persons under twenty-one (21) years of

age;

     (32) Requirements to establish a process allowing a marijuana product manufacturer to

voluntarily submit a product, its packaging and intended marketing to the department for

preliminary determination whether the product is especially appealing to persons under twenty-one

(21) years of age; and

     (33) Requirements that prohibit marijuana product manufacturers from altering or utilizing

commercially-manufactured food products when manufacturing marijuana products unless the

food product was commercially manufactured specifically for use by the marijuana product

manufacturer to infuse with marijuana; provided, however, that a commercially-manufactured food

product may be used as an ingredient in a marijuana product if:

     (i) It is used in a way that renders it unrecognizable as the commercial food product in the

marijuana product; and

     (ii) There is no statement or advertisement indicating that the marijuana product contains

the commercially-manufactured food product.

     (b) Regulations made pursuant to this section shall not:

     (1) Prohibit the operation of a marijuana establishment either expressly or through

regulations that make operation of a marijuana establishment unreasonable and impracticable;

     (2) Require a customer to provide a marijuana retailer with identifying information other

than identification to determine the customer's age, and shall not require the marijuana retailer to

acquire or record personal information about customers other than information typically required

in a retail transaction;

     (3) Prohibit a medical marijuana treatment center and a marijuana establishment from

operating at a shared location;

     (4) Prohibit marijuana establishments from transferring or acquiring marijuana seeds,

clones, cuttings, plants or plant tissue from other marijuana establishments or prohibit a marijuana

establishment from transferring or otherwise selling marijuana to a marijuana retailer, a marijuana

product manufacturer or a marijuana cultivator; or

     (5) Prohibit marijuana establishments from using inorganic cultivation methods.

     (c) The department shall administer and enforce the provisions of this chapter and the rules

and regulations relating to licensing in this chapter.

     (d) Each fiscal year the department shall submit an annual finance plan to the governor, the

speaker of the house and the president of the senate, and updates to such plan.

     (e) The department shall investigate, in conjunction with the department of public health,

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the effects of marijuana and marijuana products with a high potency of tetrahydrocannabinol on

the human body and recommend whether there should be restrictions on the potency of

tetrahydrocannabinol in cannabis and cannabis products.

     (f) The department shall be subject to all the provisions of chapter 35 of title 42.

     (g) The department shall annually submit a complete and detailed report of the department's

activities, including a review of the implementation and enforcement of this chapter and the

governance structure established in this chapter, not more than ninety (90) days after the end of the

fiscal year to the governor, the attorney general, the treasurer, the speaker of the house, and the

president of the senate.

     (h) The department in consultation with the department of revenue shall annually review

the tax rates established by this chapter and may make recommendations to the general assembly,

as appropriate, regarding any changes to the tax rates that further the intent of this chapter. The

department may study marijuana commerce and make recommendations to the general assembly

regarding changes in the laws that further the intent of this chapter by filing those recommendations

with the governor, the speaker of the house, and the president of the senate.

     (i) The department shall deposit all license, registration and monetary penalties collected

pursuant to this chapter in the social equity assistance fund established pursuant to § 21-28.11-31.

     (j) The department, shall work collaboratively with other state agencies and departments

to ensure that the production and distribution of marijuana is effectively regulated in the state in

furtherance of the intent of this act.

     21-28.11-6. Research agenda; social and economic trends and public health impacts

of marijuana.

     (a) Beginning July 1, 2021 and annually thereafter until July 1, 2025, the department of

business regulation and the department of health shall conduct research to understand the social

and economic trends of adult use medical marijuana in the state in order to inform future legislative

and policy decisions. The research shall include, but not be limited to, researching and analyzing:

     (1) Patterns of use, methods of consumption, and perceptions of marijuana among minors,

college and university students and adults;

     (2) Incidents of impaired driving, hospitalizations and use of other health care services;

     (3) Establishing a quantifiable level of marijuana-induced impairment with regard to motor

vehicle operation;

     (4) Economic and fiscal impacts resulting from marijuana usage on state and local

governments, including with regard to state and local tax revenue;

     (5) Ownership and employment trends in the marijuana industry;

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     (6) Participation by racial, ethnic and socioeconomic subgroups, including identification

of barriers to participation in the industry;

     (7) A market analysis examining the expansion or contraction of the illicit marketplace and

the expansion or contraction of the legal marketplace, including estimates and comparisons of

pricing and product availability in both markets;

     (8) Incidents of discipline in schools, including suspensions or expulsions, resulting from

marijuana use or possession of marijuana or marijuana products; and

     (9) Civil penalties, arrests, prosecutions, incarcerations and sanctions imposed for

violations for possession, distribution or trafficking of marijuana or marijuana products, including

the age, race, gender, country of origin, state geographic region and average sanctions of the

persons charged.

     (b) The department of business regulation shall work together with the department of

health, the commissioner of elementary and secondary education, the council on postsecondary

education, the department of public safety and the department of labor and training in conducting

the research and analysis identified in subsection (a) of this section. The department of business

regulation shall annually report on the results of its research and analysis, and make

recommendations, if appropriate, for further research or policy changes. The annual reports shall

be posted online in a machine-readable format.

     21-28.11-7. Licensed marijuana cultivators.

     (a) A marijuana cultivator licensed pursuant to the provisions of § 21-28.11-8 engaged in

cultivation in compliance with the provisions of a license may acquire, possess, manufacture,

cultivate, deliver, or transfer marijuana to entities licensed pursuant to the provisions of this chapter

and chapter 28.6 of title 21.

     (b) Licensing of marijuana cultivators. The director shall pursuant to the provisions of §

21-28.11-8 promulgate regulations governing the manner in which it shall consider applications for

the licensing of all marijuana cultivators, including regulations governing:

     (1) The form and content of licensing and renewal applications;

     (2) Minimum oversight requirements for licensed marijuana cultivators;

     (3) Minimum record-keeping requirements for cultivators;

     (4) Minimum security requirements for cultivators; and

     (5) Procedures for suspending, revoking, or terminating the license of cultivators who

violate the provisions of this section or the regulations promulgated pursuant to this section.

     (c) A licensed marijuana cultivator license issued by the director shall expire one year after

it was issued and the licensed marijuana cultivator may apply for renewal with the director in

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accordance with its regulations pertaining to licensed marijuana cultivators.

     (d) The director shall promulgate regulations that govern how many marijuana plants,

mature and immature; how much wet marijuana; and how much usable marijuana a licensed

marijuana cultivator may possess. Every marijuana plant possessed by a licensed marijuana

cultivator shall be catalogued in a seed-to-sale inventory tracking system in accordance with

regulations promulgated by the director.

     (e) Marijuana cultivators shall sell marijuana only to an entity licensed pursuant to the

provisions of this chapter or chapter 28.6 of title 21.

     (f) Marijuana cultivators shall be subject to any regulations promulgated by the director

that specify how marijuana shall be tested, including, but not limited to, potency, cannabinoid

profile, and contaminants.

     (g) Marijuana cultivators shall be subject to any product labeling requirements promulgated

by the director.

     (h) Notwithstanding any other provisions of the general laws, the manufacture of marijuana

using a solvent extraction process that includes the use of a compressed, flammable gas as a solvent

by a licensed marijuana cultivator shall not be subject to the protections of this chapter.

     (i) Marijuana cultivators shall be licensed to grow marijuana only at a location or locations

registered with the department. The director may promulgate regulations governing where

cultivators are allowed to grow. Marijuana cultivators shall abide by all local ordinances, including

zoning ordinances.

     (j) As a condition of licensing, marijuana cultivators shall consent and be subject to

reasonable inspection by the director or designee for the purposes of enforcing regulations

promulgated pursuant to this chapter and all applicable laws.

     (k) The cultivator applicant, unless he or she is an employee with no equity, ownership,

financial interest, or managing control, shall apply to the bureau of criminal identification of the

department of attorney general, department of public safety division of state police, or local police

department for a national criminal records check that shall include fingerprints submitted to the

Federal Bureau of Investigation. Upon the discovery of any criminal record information, the bureau

of criminal identification of the department of attorney general, department of public safety division

of state police, or the local police department shall inform the applicant, in writing, of the nature of

the criminal record information. In those situations in which no criminal record information has

been found, the bureau of criminal identification of the department of attorney general, department

of public safety division of state police, or the local police department shall inform the applicant

and the director, in writing, of this fact.

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     (l) Except for employees with no ownership, equity, financial interest, or managing control

of a marijuana establishment license, the cultivator applicant shall be responsible for any expense

associated with the national criminal records check.

     (m) Persons issued marijuana cultivator licenses shall be subject to the following:

     (1) A licensed marijuana cultivator shall notify and request approval from the director of

any change in his or her name or address within ten (10) days of the change. A licensed cultivator

who fails to notify the director of any of these changes is responsible for a civil infraction,

punishable by a fine of no more than five thousand dollars ($5,000) and for forfeiture of the

cultivator's license.

     (2) When a licensed marijuana cultivator notifies the director of any changes to the location

listed in subsection (m)(1) of this section, the director may issue the cultivator an updated license

after the director approves the changes and receives from the licensee payment of a fee specified

in regulation.

     (3) If a licensed marijuana cultivator loses his or her license, he or she shall notify the

department and submit a fee specified in regulation within ten (10) days of losing the license. The

department shall issue a new license with a new random identification number.

     (4) A licensed marijuana cultivator shall notify the director of any potential disqualifying

criminal convictions pursuant to the provisions of § 21-28.11-12.1. The director may suspend

and/or revoke his or her license after the notification, pending a final determination of

disqualification pursuant to § 21-28.11-12.1.

     (5) If a licensed marijuana cultivator violates any provision of this chapter or regulations

promulgated hereunder as determined by the director, his or her license may be suspended and/or

revoked.

     (n) Immunity.

     (1) No licensed marijuana cultivator shall be subject to: prosecution; search, except by the

department pursuant to subsection (j) of this section; seizure; or penalty in any manner, or denied

any right or privilege, including, but not limited to, civil penalty or disciplinary action by a business,

occupational, or professional licensing board or entity, solely for acting in accordance with this

section.

     (2) No licensed department cultivator shall be subject to prosecution, seizure, or penalty in

any manner, or denied any right or privilege, including, but not limited to, civil penalty or

disciplinary action by a business, occupational, or professional licensing board or entity, for selling,

giving, or distributing marijuana in whatever form and within the limits established by the director

to an entity licensed pursuant to this chapter or chapter 28.6 of title 21.

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     (3) No principal officers, board members, agents, volunteers, or employees of a licensed

medical marijuana cultivator shall be subject to arrest, prosecution, search, seizure, or penalty in

any manner, or denied any right or privilege, including, but not limited to, civil penalty or

disciplinary action by a business, occupational, or professional licensing board or entity, solely for

working for or with a licensed marijuana cultivator to engage in acts permitted by this section.

     (4) No state employee shall be subject to arrest, prosecution, or penalty in any manner, or

denied any right or privilege, including, but not limited to, civil penalty, disciplinary action,

termination, or loss of employee or pension benefits, for any and all conduct that occurs within the

scope of his or her employment regarding the administration, execution, and/or enforcement of this

chapter, and the provisions of §§ 9-31-8 and 9-31-9 shall be applicable to this section.

     (o) License required. No person or entity shall engage in activities described in this section

without a marijuana cultivator license issued by the department.

     (p) Nothing in this section shall be construed as authorizing a marijuana cultivator to

transfer or sell marijuana to a consumer. A direct sale or transfer from a marijuana cultivator to a

consumer is prohibited.

     21-28.11-8. Cultivation licenses.

     (a) Except for cultivation licenses issued pursuant to the provisions of subsection (b) of

this section, no license to cultivate marijuana pursuant to the provisions of § 21-28.11-7 shall be

issued prior to July 1, 2024.

     (b) Any medical marijuana cultivator licensed or approved pursuant to the provisions of §

21-28.6-16 may apply for a cultivators license pursuant to the provisions of § 21-28.11-7 and upon

payment of an application fee of five thousand dollars ($5,000) shall be issued a hybrid marijuana

cultivators license for the cultivation and sale of marijuana pursuant to the provisions of this chapter

and chapter 28.6 of title 21, subject to the following conditions:

     (1) The applicant must be in good standing with the department pursuant to the provisions

of chapter 28.6 of title 21;

     (2) Issuance of the hybrid marijuana cultivator license to the applicant shall have no

significant adverse effect on the medical marijuana program and patient needs; and

     (3) The applicant maintains the medical marijuana cultivator license in good standing as a

condition for issuance of the hybrid marijuana cultivation license.

     (c) Beginning on July 1, 2024 and thereafter, the department may adopt cultivator license

classes that authorize various size cultivation facilities based on the capability and capacity of

marijuana cultivator licensees to supply marijuana and marijuana products to meet the market

demands as well as market factors including, but not limited to, the findings of research conducted

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pursuant to § 21-28.11-6 and taking into consideration the impact of said licenses on public health

and safety.

     21-28.11-9. Report.

     On or before January 1, 2024, the department shall file with the speaker of the house, the

president of the senate and the governor a report concerning the findings of research conducted

pursuant to § 21-28.11-6 and the license classes to be authorized by the department pursuant to §

21-28.11-8.

     21-28.11-10. Marijuana retail sales license.

     (a) A marijuana retailer shall have a marijuana retail sales license issued by the department.

     (b) The department, upon receipt of an application in compliance with the provisions of

this chapter and the payment of required fees, shall issue a retail sales license to any applicant entity

licensed pursuant to the provisions of chapter 28.6 of title 21, subject to the provisions of subsection

(c) of this section.

     (c) Any medical marijuana treatment center licensed pursuant to the provisions of chapter

28.6 of title 21 may apply for a marijuana retail license pursuant to the provisions of this chapter,

and upon payment of a license fee of five hundred thousand dollars ($500,000) shall be issued a

hybrid marijuana retailer license for the sale of marijuana pursuant to the provisions of this chapter

and chapter 28.6 of title 21, subject to the following conditions:

     (1) The applicant must be in good standing with the department pursuant to the provisions

of chapter 28.6 of title 21;

     (2) Issuance of the hybrid marijuana retail license to the applicant shall have no significant

adverse effect on the medical marijuana program and patient needs; and

     (3) The applicant maintains the license authorizing operation as a medical marijuana

treatment center in good standing as a condition for issuance of the hybrid marijuana retail license.

     (d) In addition to the issuance of hybrid marijuana retail licenses, the department of

business regulation shall establish and open an application period during which the department

shall accept applications for the issuance of six (6) non-medical marijuana retailer licenses. To the

extent that the total number of qualifying applications for non-medical adult use marijuana retailer

licenses received by the department during the application period exceeds the number of non-

medical adult use marijuana retailer licenses available, the department shall award the non-medical

adult use marijuana retailer licenses to qualifying applications selected by way of a randomized

lottery in accordance with rules and regulations promulgated by the department, provided in no

case shall the number of non-medical adult use marijuana retailer licenses awarded to qualifying

social equity applicants be fewer than five (5), and in no case shall the total number of non-medical

LC002923 - Page 18 of 53

adult use marijuana retailer licenses awarded to qualifying applicants organized as workers'

cooperatives under chapter 6.2 of title 7 be fewer than one.

     (e) The department of business regulation shall promulgate rules and regulations that

identify the factors and other considerations to be evaluated in certifying applicants as social equity

applicants, and in determining whether applicants are qualified to receive a non-medical adult use

marijuana retailer licenses.

     (f) Beginning on July 1, 2021, the department is authorized to issue a combined total of

fifteen (15) licenses for retail sale of marijuana, and said total shall include licenses issued pursuant

to this chapter and chapter 28.6 of title 21. An entity licensed pursuant to chapter 28.6 of title 21

and possessing a hybrid license pursuant to the provisions of this chapter shall be considered to

possess one license for purposes of the provision of this section.

     (g) Beginning on July 1, 2025 and thereafter, the department may open an application

period for issuance of additional marijuana retailer licenses based on market factors including, but

not limited to, the findings of research conducted pursuant to § 21-28.11-6 and taking into

consideration the impact of said additional licenses on public health and safety.

     21-28.11-11. Independent testing laboratories -- Licensure and oversight.

     (a)(1) The director shall promulgate regulations for the licensure and oversight of

independent testing laboratories, and shall establish testing protocols for the sampling, testing and

analysis of marijuana, finished marijuana and marijuana products in consultation with the

department of health. Such regulations shall be based on the most recent standards as issued by the

United States Pharmacopeial Convention and shall address sampling and analysis to characterize

the cannabinoid profile and biological and chemical contaminants, including, but not limited to,

terpenoids, pesticides, plant growth regulators, metals, microbiological contaminants, mycotoxins,

and residual solvents introduced through cultivation of cannabis plants and post-harvest processing

and handling of cannabis, cannabis products and ingredients.

     (2) No marijuana or marijuana product shall be sold or otherwise marketed pursuant to this

chapter that has not first been tested by an independent testing laboratory and determined to meet

the department's testing protocols issued pursuant to subsection (a)(1) of this section.

     (3) An independent testing laboratory shall report any results indicating contamination to

the department and to the department of environmental management within seventy-two (72) hours

of identification.

     (4) No laboratory agent or employee of an independent testing laboratory shall receive

direct or indirect financial compensation, other than such reasonable contractual fees to conduct

such testing, from any entity for which it is conducting testing pursuant to this chapter.

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     (5) No individual who possesses an interest in or is a laboratory agent employed by an

independent testing laboratory, and no immediate family member of that individual, shall possess

an interest in or be employed by a marijuana establishment.

     (b)(1) An independent testing laboratory shall submit a nonrefundable application fee of

three hundred dollars ($300) and apply for a testing license from the department prior to testing,

processing or transporting marijuana. Prior to the issuance of any license and for any period of

renewal, the applicant shall submit an annual fee of five thousand dollars ($5,000).

     (2) A laboratory agent shall be registered with the department prior to volunteering or

working at an independent testing laboratory.

     (3) An independent testing laboratory shall apply to the department for a registration card

for each affiliated laboratory agent by submitting, at a minimum, the name, address, and date of

birth of the laboratory agent.

     (4) An independent testing laboratory shall notify the department within one business day

if a laboratory agent ceases to be associated with the laboratory, and the laboratory agent's

registration card shall be immediately revoked.

     (5) A prospective laboratory agent who has been convicted of a felony drug offense, may

be disqualified from being registered and employed as a laboratory agent pursuant to § 21-28.11-

12.1. The department may conduct criminal record checks on prospective agents, and may set

standards and procedures to enforce this provision. Such standards and procedures may include

requiring applicants seeking registration to submit a full set of fingerprints for the purposes of

conducting a state and national criminal history records check.

     (c) An independent testing laboratory and all agents and employees shall comply with all

rules adopted by the director and all applicable laws.

     (d) A registered laboratory agent shall not be subject to arrest, prosecution, civil penalty,

sanctions or disqualifications, and shall not be subject to seizure or forfeiture of assets under Rhode

Island law for actions taken under the authority of an independent testing laboratory, including

possessing, processing, storing, transferring or testing marijuana provided the agent:

     (1) Presents his or her registration card to any law enforcement official who questions the

laboratory agent concerning their marijuana related activities; and

     (2) Is acting in accordance with all the requirements of this chapter.

     21-28.11-11.1. Marijuana testing laboratories -- Immunity.

     (a) No marijuana testing laboratory shall be subject to prosecution; search (except by the

department pursuant to regulations); seizure; or penalty in any manner, or denied any right or

privilege, including, but not limited to, civil penalty or disciplinary action by a business,

LC002923 - Page 20 of 53

occupational, or professional licensing board or entity, solely for acting in accordance with the

provisions of this chapter and regulations promulgated hereunder.

     (b) No marijuana testing laboratory shall be subject to prosecution, search (except by the

department pursuant to regulations), seizure, or penalty in any manner, or denied any right or

privilege, including, but not limited to, civil penalty or disciplinary action, by a business,

occupational, or professional licensing board or entity, for selling, giving, or distributing marijuana

in whatever form, and within the limits established by, the director to another marijuana testing

laboratory.

     (c) No principal officers, board members, agents, volunteers, or employees of a marijuana

testing laboratory shall be subject to arrest, prosecution, search, seizure, or penalty in any manner,

or denied any right or privilege, including, but not limited to, civil penalty or disciplinary action by

a business, occupational, or professional licensing board or entity, solely for working for or with a

marijuana testing laboratory to engage in acts permitted by the act and the regulations promulgated

hereunder.

     (d) No state employee shall be subject to arrest, prosecution or penalty in any manner, or

denied any right or privilege, including, but not limited to, civil penalty, disciplinary action,

termination, or loss of employee or pension benefits, for any and all conduct that occurs within the

scope of his or her employment regarding the administration, execution and/or enforcement of this

chapter, and the provisions of §§ 9-31-8 and 9-31-9 shall be applicable to this section.

     21-28.11-12. Licenses for handlers and employees.

     The director may promulgate rules and regulations to establish the registration or licensing

of an individual who performs work for or on behalf of a person or entity licensed pursuant to the

provisions of this chapter to include, but not be limited to, employees, independent contractors,

transporters, security personnel, quality control or testing personnel, packagers and sales personnel.

Individuals registered or licensed pursuant to this section shall be required to comply with all rules

adopted by the director and all applicable laws.

     21-28.11-13. Taxes.

     (a) The following taxes are imposed on the retail sale of marijuana pursuant to the

provisions of this chapter by individuals licensed pursuant to § 21-28.11-10:

     (1) Sales tax pursuant to the provisions of § 44-18-18;

     (2) A state marijuana excise tax equal to eight percent (8%) of each retail sale; and

     (3) A local excise tax equal to five percent (5%) of each retail sale.

     (b) The assessment, collection and enforcement of the sales tax pursuant to § 44-18-18 and

the state marijuana excise tax shall be pursuant to the provisions of chapter 18 of title 44.

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     (c) The assessment, collection and enforcement of the local excise tax shall be pursuant to

chapter 70 of title 44.

     21-28.11-14. Municipal fees.

     Except as authorized pursuant to § 21-28.11-16 no municipal or local fee, tax, charge or

expense shall be assessed or collected from an individual licensed pursuant to the provisions of §

21-28.11-10 except for local excise tax pursuant to § 21-28.11-13 and any other fee, tax, charge or

expense generally assessed or collected from residents or businesses located in the municipality.

     21-28.11-15. Local option.

     (a) Every municipality may prohibit marijuana cultivation for retail sale and/or the retail

sale of marijuana within the jurisdiction of the municipality.

     (b) Nothing in this section shall be construed to authorize a municipality to prohibit the

operation of any preexisting marijuana center, medical marijuana cultivation or medical marijuana

manufacturing.

     21-28.11-16. Local control.

     (a) A municipality may adopt ordinances that impose reasonable safeguards on the

operation of marijuana establishments, provided they are not unreasonable and impracticable and

are not in conflict with this chapter or with regulations made pursuant to this chapter and that:

     (1) Govern the time, place and manner of marijuana establishment operations and of any

business dealing in marijuana accessories.

     (2) Restrict the licensed cultivation, processing and manufacturing of marijuana that is a

public nuisance;

     (3) Establish reasonable restrictions on public signs related to marijuana establishments;

provided, however, that if a municipality enacts an ordinance or by-law more restrictive than the

department's standard, than the local ordinance shall not impose a standard for signage more

restrictive than those applicable to retail establishments that sell alcoholic beverages within that

municipality;

     (4) Establish a civil penalty for violation of an ordinance enacted pursuant to this

subsection, similar to a penalty imposed for violation of an ordinance relating to alcoholic

beverages.

     (b) No municipality shall prohibit the transportation of lawful marijuana or marijuana

products or adopt an ordinance that makes the transportation of lawful marijuana or marijuana

products unreasonable and impracticable.

     (c) Zoning or use ordinances enacted by municipalities shall not require marijuana

establishment licensees or marijuana establishment applicants to enter into community host

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agreements or pay any consideration to municipalities other than reasonable zoning and permitting

fees. The department of business regulation is the sole licensing authority for marijuana

establishment licensees. Municipalities shall not enact any zoning or use ordinances or permitting

requirements that establish a de facto local license or licensing process, unless explicitly enabled

by this chapter or regulations promulgated by the department of business regulation.

     (d) Notwithstanding subsection (c) of this section, municipalities may collect municipal

impact fees from licensed and operating marijuana establishments located within their jurisdiction

during the first six (6) months following the establishments' commencement of operations

provided:

     (1) The municipal impact fees shall be reasonably related to the costs imposed upon the

municipality by the operation of the newly licensed marijuana establishment and shall offset or

reimburse reasonable and appropriate expenses incurred by the municipality, which are directly

attributed to, or are a direct result of, the operations of the marijuana establishment, which may

include, but not be limited to, increased traffic or police details needed to address new traffic

patterns, increased parking needs, or pedestrian foot traffic by consumers;

     (2) The municipal impact fees shall not exceed two percent (2%) of the gross annual sales

of the marijuana establishment;

     (3) Municipalities are responsible for demonstrating and calculating municipal impact fees

and shall follow the same methodology if providing fees for multiple marijuana establishments or

locations;

     (4) Marijuana establishment licensees or applicants shall not pay or offer to pay municipal

impact fees that are more than the actual and reasonable costs and expenses incurred by

municipalities; and

     (5) The department of business regulation may suspend, revoke, refuse to issue or refuse

to reissue applications or licenses for marijuana establishment applicants or licensees that violate

the provisions of this section.

     21-28.11-17. General conditions for licenses.

     (a) Upon receipt of a complete marijuana establishment license application and the

application fee, the department shall forward a copy of the application to the city or town in which

the marijuana establishment is to be located, determine whether the applicant and the premises

qualify for the license and has complied with this chapter and shall, within ninety (90) days:

     (1) Issue the appropriate license; or

     (2) Send to the applicant a notice of rejection setting forth specific reasons why the

department did not approve the license application.

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     (b) The department shall approve a marijuana establishment license application and issue

a license if:

     (1) The prospective marijuana establishment has submitted an application in compliance

with regulations made by the department, the applicant satisfies the requirements established by

the department, the applicant is in compliance with this chapter and the regulations made by the

director and the applicant has paid the required fee;

     (2) The department is not notified within forty-five (45) days of the department forwarding

the application in accordance with section (a) of this sectoin by the city or town in which the

proposed marijuana establishment will be located that the proposed marijuana establishment is not

in compliance with an ordinance in effect at the time of application;

     (3) The property where the proposed marijuana establishment is to be located, at the time

the license application is received by the department, is not located within five hundred feet (500')

of a pre-existing public or private school providing education in kindergarten or any of grades one

through twelve (12), unless a city or town adopts an ordinance that reduces the distance

requirement; and

     (4) Every individual who will be a controlling person of the proposed marijuana

establishment has not been convicted of a felony or convicted of an offense in another state that

would be a felony in the state, or the prior conviction is solely for a marijuana offense subject to

expungement, or the individual is determined to be not disqualified pursuant to § 21-28.11-12.1.

     (c) In addition to requirements established by regulation or by a city or town pursuant to

this chapter, a marijuana establishment shall:

     (1) Secure every entrance to the establishment in order that access to areas containing

marijuana is restricted to employees and others permitted by the marijuana establishment to access

the area and to agents of the department or state and local law enforcement officers and emergency

personnel; and

     (2) Secure its inventory and equipment during and after operating hours to deter and

prevent theft of cannabis, marijuana products and marijuana accessories.

     (d) No marijuana establishment may cultivate, process, test, store or manufacture

marijuana or marijuana products at any location other than at a physical address approved by the

department and within an area that is enclosed and secured in a manner that prevents access by

persons not permitted by the marijuana establishment to access the area. A greenhouse or outdoor

marijuana cultivation area shall have sufficient security measures to demonstrate that outdoor areas

are not readily accessible by unauthorized individuals, including perimeter security fencing

designed to prevent unauthorized entry.

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     (e) No marijuana establishment shall allow cultivation, processing, manufacture, sale or

display of marijuana or marijuana products to be visible from a public place without the use of

binoculars, aircraft or other optical aids.

     (f) No marijuana establishment shall refuse representatives of the department the right at

any time of operation to inspect the entire licensed premises or to audit the books and records of

the marijuana establishment.

     (g) No marijuana establishment shall allow any person under twenty-one (21) years of age

to volunteer or work for the marijuana establishment.

     (h) No marijuana establishment shall cultivate, manufacture, sell or otherwise transact

business with any products containing cannabinoids other than those that were produced,

distributed and taxed in compliance with this chapter.

     (i) No licensee shall operate a marijuana establishment without an operations certificate

issued by the department.

     (j) Each licensee shall file an emergency response plan with the fire department and police

department of the host community.

     21-28.11-18. Administration and enforcement.

     (a) The department shall be responsible for the enforcement and administration of the

provisions of this chapter and for the provisions of chapter 28.6 of title 21.

     (b) The director is consultation with the department of health and the department of

environmental management shall promulgate rules and regulations to carry out the purpose and

intent of this chapter and chapter 28.6 of title 21.

     21-28.11-19. Multiple licenses restricted.

     (a) Except as provided in § 21-28.6-12(g)(4) no person or entity licensed pursuant to the

provisions of this chapter shall be granted more than one license. For purposes of this section, any

hybrid license shall be considered as one license.

     (b) No licensee shall own, control, manage or operate any other entity licensed pursuant to

the provisions of this chapter.

     (c) Nothing in this section shall be construed to prohibit a licensee pursuant to the

provisions of chapter 28.6 of title 21 from possessing one license issued pursuant to the provisions

of this chapter.

     21-28.11-20. Audits and reports.

     (a)(1) The department shall audit as often as the department determines necessary the

accounts, programs, activities, and functions of all licensees. To conduct the audit, authorized

officers and employees of the department shall have access to such accounts at reasonable times

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and the department may require the production of books, documents, vouchers and other records

relating to any matter within the scope of the audit, except tax returns. The superior court shall have

jurisdiction to enforce the production of records that the department requires to be produced under

this section and the court shall order the production of all such records within the scope of any such

audit. All audits shall be conducted in accordance with generally accepted auditing standards

established by the American Institute of Certified Public Accountants. In any audit report of the

accounts, funds, programs, activities and functions of a licensee issued by the department

containing adverse or critical audit results, the department may require a response, in writing, to

the audit results. The response shall be forwarded to the department within fifteen (15) days of

notification by the department.

     (2) On or before April 1 of each year, the department shall submit a report to the governor,

the speaker of the house and the president of the senate, which shall include, but not be limited to:

     (i) The number of audits performed under this section;

     (ii) A summary of findings under the audits; and

     (iii) The cost of each audit.

     21-28.11-21. Expiration and renewal.

     (a) All licenses under this chapter shall be effective for one year from the date of issuance.

     (b) The department shall issue a renewal license within thirty (30) days of receipt of a

renewal application and renewal license fee from licensees in good standing and who have filed all

required tax returns and paid all required taxes.

     21-28.11-22. Personal use of marijuana.

     (a) Notwithstanding any other general or special law to the contrary, except as otherwise

provided in this chapter, a person twenty-one (21) years of age or older shall not be arrested,

prosecuted, penalized, sanctioned or disqualified under the laws of the state in any manner, or

denied any right or privilege and shall not be subject to seizure or forfeiture of assets for:

     (1) Possessing, using, purchasing, processing or manufacturing one ounce (1 oz.) or less of

marijuana, except that not more than five grams (5 g) of marijuana may be in the form of marijuana

concentrate;

     (2) Within the person's primary residence, possessing up to ten ounces (10 oz.) of marijuana

and any marijuana produced by marijuana plants cultivated on the premises and possessing,

cultivating or processing not more than six (6) marijuana plants for personal use as long as not

more than twelve (12) plants are cultivated on the premises at once;

     (3) Assisting another person who is twenty-one (21) years of age or older in any of the acts

described in this section; or

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     (4) Giving away or otherwise transferring without remuneration up to one ounce (1 oz.) of

marijuana, except that not more than five grams (5 g) of marijuana may be in the form of marijuana

concentrate, to a person twenty-one (21) years of age or older, as long as the transfer is not

advertised or promoted to the public.

     (b) Notwithstanding any other general or special law to the contrary, except as otherwise

provided in this chapter, if the import or export of marijuana to or from the state is not prohibited

by federal law, a person twenty-one (21) years of age or older shall not be arrested, prosecuted,

penalized, sanctioned or disqualified under the laws of the state in any manner, or denied any right

or privilege and shall not be subject to seizure or forfeiture of assets for possessing, using,

purchasing, cultivating, processing or manufacturing any amount of marijuana or marijuana

products for personal use.

     (c) Notwithstanding any other general or special law to the contrary, except as otherwise

provided in this chapter, a person shall not be arrested, prosecuted, penalized, sanctioned or

otherwise denied any benefit and shall not be subject to seizure or forfeiture of assets for allowing

property the person owns, occupies or manages to be used for any of the activities conducted

lawfully under this chapter or for enrolling or employing a person who engages in marijuana-related

activities lawfully under this chapter.

     (d) Absent clear and convincing evidence that the person's actions related to marijuana

have created an unreasonable danger to the safety of a minor child, neither the presence of

cannabinoid components or metabolites in a person's bodily fluids nor conduct permitted under this

chapter related to the possession, consumption, transfer, cultivation, manufacture or sale of

marijuana, marijuana products or marijuana accessories by a person charged with the well-being of

a child shall form the sole or primary basis for substantiation, service plans, removal or termination

or for denial of custody, visitation or any other parental right or responsibility.

     (e) The use of marijuana shall not disqualify a person from any needed medical procedure

or treatment, including organ and tissue transplants.

     (f) Notwithstanding any general or special law to the contrary, except as otherwise

provided in this chapter, a person twenty-one (21) years of age or older shall not be arrested,

prosecuted, penalized, sanctioned or disqualified and is not subject to seizure or forfeiture of assets

for possessing, producing, processing, manufacturing, purchasing, obtaining, selling or otherwise

transferring or delivering hemp.

     (g) For the purposes of this section, "marijuana concentrate" means the resin extracted from

any part of the plant of the genus cannabis and every compound, manufacture, salt, derivative,

mixture or preparation of that resin but shall not include the weight of any other ingredient

LC002923 - Page 27 of 53

combined with marijuana to prepare marijuana products.

     21-28.11-23. Marijuana accessories authorized.

     Notwithstanding any general or special law to the contrary, except as otherwise provided

in this chapter, a person twenty-one (21) years of age or older shall not be arrested, prosecuted,

penalized, sanctioned or disqualified and shall not be subject to seizure or forfeiture of assets for

possessing, purchasing or otherwise obtaining or manufacturing marijuana accessories or for

selling or otherwise transferring marijuana accessories to a person who is twenty-one (21) years of

age or older.

     21-28.11-24. Lawful operation of marijuana establishments.

     (a) Notwithstanding any general or special law to the contrary, except as otherwise

provided in this chapter, the following persons involved in the distribution of marijuana as

authorized by this chapter shall not be arrested, prosecuted, penalized, sanctioned or disqualified

and shall not be subject to seizure or forfeiture of assets for activities specified for:

     (1) A marijuana retailer or an owner, operator, employee or other agent acting on behalf of

a marijuana retailer possessing or testing marijuana or marijuana products, purchasing, selling or

otherwise transferring or delivering marijuana or marijuana products to or from a marijuana

establishment; or selling or otherwise transferring or delivering marijuana or marijuana products to

a consumer;

     (2) A marijuana cultivator or an owner, operator, employee or other agent acting on behalf

of a marijuana cultivator cultivating, propagating, breeding, harvesting, processing, packaging,

testing, storing or possessing marijuana or marijuana products, or selling or otherwise transferring,

purchasing or delivering marijuana and marijuana products to or from a marijuana establishment;

     (3) A marijuana product manufacturer or an owner, operator, employee or other agent

acting on behalf of a marijuana product manufacturer packaging, processing, manufacturing,

storing, testing or possessing marijuana or marijuana products, or delivering, selling or otherwise

transferring and purchasing marijuana or marijuana products to or from a marijuana establishment;

or

     (4) A marijuana testing facility or an owner, operator, employee or other agent acting on

behalf of a marijuana testing facility possessing, processing, storing, transferring or testing

marijuana or marijuana products.

     (b) Any licensee, or agent or employee thereof, under this chapter who reasonably relies

on a state issued identification card, or on a motor vehicle license, or on a valid passport issued by

the United States government, or by the government of a foreign country recognized by the United

States government, or a valid United States issued military identification card, for proof of a

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person's identity and age shall not suffer any modification, suspension, revocation or cancellation

of such license, nor shall the licensee, agent or employee suffer any criminal liability, for delivering

or selling marijuana or marijuana products to a person under twenty-one (21) years of age. Any

licensee, or agent or employee thereof, under this chapter, who reasonably relies on the forms of

identification listed in this subsection, for proof of a person's identity and age shall be presumed to

have exercised due care in making such delivery or sale of marijuana or marijuana products to a

person under twenty-one (21) years of age. Such presumption shall be rebuttable.

     21-28.11-25. Contracts pertaining to marijuana enforceable.

     It is the public policy of the state that contracts related to the operation of marijuana

establishments under this chapter shall be enforceable. A contract entered into by a licensee or its

agents as permitted pursuant to a valid license issued by the department, or by those who allow

property to be used by a licensee or its agents as permitted pursuant to a valid license issued by the

department, shall not be unenforceable or void exclusively because the actions or conduct permitted

pursuant to the license is prohibited by federal law.

     21-28.11-26. Provision of professional services.

     A person engaged in a profession or occupation subject to licensure shall not be subject to

disciplinary action by a professional licensing board solely for providing professional services to

prospective or licensed marijuana establishments related to activity under this chapter that is not

subject to criminal penalty under the laws of the state.

     21-28.11-27. Penalties.

     (a) No person shall cultivate or process marijuana plants pursuant to this chapter if the

plants are visible from a public place without the use of binoculars, aircraft or other optical aids or

cultivate or process marijuana plants outside of an area that is equipped with a lock or other security

device. A person who violates this subsection shall be punished by a civil penalty of not more than

three hundred dollars ($300) and forfeiture of the marijuana, but shall not be subject to any other

form of criminal or civil punishment or disqualification solely for this conduct.

     (b) No person shall possess more than one ounce (1oz.) of marijuana or marijuana products

within the person's place of residence pursuant to § 21-28.11-22 unless the marijuana and marijuana

products are secured by a lock. A person who violates this subsection shall be punished by a civil

penalty of not more than five hundred dollars ($500) and forfeiture of the marijuana.

     (c) No person shall consume marijuana in a public place or smoke marijuana where

smoking tobacco is prohibited. A person who violates this subsection shall be punished by a civil

penalty of not more than five hundred dollars ($500). This subsection shall not apply to a person

who consumes marijuana or marijuana products in a designated area of a marijuana establishment

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located in a city or town that has authorized consumption on the premises where sold and shall not

be construed to limit the medical use of marijuana.

     (d) Notwithstanding the provisions of this chapter and until the import or export of

marijuana to or from the state is not prohibited by federal law, a person who is at least twenty-one

(21) years of age and who cultivates more than six (6) but not more than twelve (12) marijuana

plants or who possesses an amount of marijuana outside of his or her place of residence having a

weight of more than one ounce (1 oz.) but not more than two ounces (2 oz.) shall be subject only

to a civil penalty of not more than five hundred dollars ($500) and forfeiture of the marijuana not

allowed by this chapter, but shall not be subject to any other form of criminal or civil punishment

or disqualification solely for this conduct.

     (e) A person under twenty-one (21) years of age, except a qualifying patient holding a valid

registration card for the medical use of marijuana, who purchases or attempts to purchase

marijuana, marijuana products or marijuana accessories, or makes arrangements with any person

to purchase or in any way procure marijuana, marijuana products or marijuana accessories, or who

willfully misrepresents such person's age, or in any way alters, defaces or otherwise falsifies

identification offered as proof of age, with the intent of purchasing marijuana, marijuana products

or marijuana accessories, shall be punished by a civil penalty of not more than five hundred dollars

($500) and shall complete a drug awareness program. The parents or legal guardian of any offender

under the age of eighteen (18) shall be notified, and the failure within one year of the offense of

such an offender to complete a drug awareness program may be a basis for delinquency proceedings

for persons under the age of seventeen (17) years of age at the time of the person's offense.

     (f) Civil penalties imposed pursuant to this section shall be enforced by utilizing the non-

criminal disposition procedures provided in this chapter, as well as any other applicable provision

of the general laws.

     (g)(1) A person less than twenty-one (21) years of age, except a qualifying patient holding

a valid registration card or prescription for the medical use of marijuana, who cultivates not more

than twelve (12) marijuana plants shall be punished by a civil penalty of not more than five hundred

dollars ($500) and shall complete a drug awareness program established pursuant to the provisions

of this chapter. If a person is less than eighteen (18) years of age at the time of the offense and fails

to complete a drug awareness program not later than one year after the offense, that person may be

subject to delinquency proceedings and/or assessed a civil penalty of no more than five hundred

dollars ($500).

     (2) If an offender under the age of eighteen (18) years of age, a parent or legal guardian

fails to file with the clerk of the appropriate court a certificate that the offender has completed a

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drug awareness program in accordance this chapter within one year of the relevant offense, the

clerk shall notify the offender, parent or guardian and the enforcing person who issued the original

notice to the offender of a hearing to show cause why the civil penalty should not be increased to

one thousand dollars ($1,000). Factors to be considered in weighing cause shall be limited to

financial capacity to pay any increase, the offender's ability to participate in a compliant drug

awareness program and the availability of a suitable drug awareness program. Any civil penalties

imposed under the provisions of this section shall inure to the city or town where the offense

occurred.

     (i) Whoever furnishes marijuana, marijuana products or marijuana accessories to a person

less than twenty-one (21) years of age, either for the person's own use or for the use of the person's

parent or another person shall be punished by a fine of not more than two thousand dollars ($2,000)

or by imprisonment for not more than one year, or both.

     (j) For the purposes of this subsection, "furnish" means to knowingly or intentionally

supply, give or provide marijuana to a person less than twenty-one (21) years of age, except for the

children and grandchildren of the person being charged.

     (k) This subsection shall not apply to the sale, delivery or furnishing of medical marijuana,

which is otherwise in compliance with the provisions of chapter 28.6 of title 21.

     21-28.11-28. Liability to state under this chapter as debt.

     Any liability to the state under this chapter shall constitute a debt to the state. Once a

statement naming a licensee is recorded, registered or filed, any such debt shall constitute a lien on

all commercial property owned by a licensee in the state and shall have priority over an

encumbrance recorded, registered or filed with respect to any site.

     21-28.11-29. Scope of chapter.

     (a) This chapter shall not permit:

     (1) Any person to undertake any task under the influence of marijuana when doing so

would constitute negligence or professional malpractice;

     (2) The smoking of marijuana:

     (i) In a school bus or other form of public transportation;

     (ii) On any school grounds;

     (iii) In any correctional facility;

     (iv) In any public place;

     (v) In any licensed drug treatment facility in this state; or

     (vi) Where exposure to the marijuana smoke significantly adversely affects the health,

safety, or welfare of children; or

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     (3) Any person to operate, navigate, or be in actual physical control of any motor vehicle,

aircraft, or motorboat while under the influence of marijuana. However, a registered qualifying

patient shall not be considered to be under the influence solely for having marijuana metabolites in

his or her system.

     (b) Nothing in this chapter shall be construed to require:

     (1) A government medical assistance program or private health insurer or workers'

compensation insurer, workers' compensation group self-insurer, or employer self-insured for

workers' compensation under § 28-36-1 to reimburse a person for costs associated with the medical

use of marijuana; or

     (2) An employer to accommodate the medical use of marijuana in any workplace.

     (c) Fraudulent representation to a law enforcement official of any fact or circumstance

relating to the medical use of marijuana to avoid arrest or prosecution shall be punishable by a fine

of five hundred dollars ($500) which shall be in addition to any other penalties that may apply for

making a false statement for the non-medical use of marijuana.

     (d) Nothing contained in this chapter shall be construed to require employers to

accommodate the use or possession of marijuana, or being under the influence of marijuana, in any

workplace. Employers may implement drug use policies which prohibit the use or possession of

marijuana in the workplace or working under the influence of marijuana; provided that, unless such

use is prohibited pursuant to the terms of a collective bargaining agreement, an employer shall not

fire or take disciplinary action against an employee solely for an employee's private, lawful use of

marijuana outside the workplace and as long as the employee has not and is not working under the

influence of marijuana except to the extent that the employer is a federal contractor or otherwise

subject to federal law or regulations such that failure to take such action would cause the employer

to lose a monetary or licensing related benefit thereunder.

     21-28.11-30. Activities not exempt.

     The provisions of this chapter do not exempt any person from arrest, civil or criminal

penalty, seizure or forfeiture of assets, discipline by any state or local licensing board or authority,

and state prosecution for, nor may they establish an affirmative defense based on this chapter to

charges arising from, any of the following acts:

     (1) Driving, operating, or being in actual physical control of a vehicle or a vessel under

power or sail while impaired by marijuana or marijuana products;

     (2) Possessing or using marijuana or marijuana products if the person is a prisoner;

     (3) Possessing or using marijuana or marijuana products in any local detention facility, jail,

state prison, reformatory, or other correctional facility, including, without limitation, any facility

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for the detention of juvenile offenders; or

     (4) Manufacturing or processing of marijuana products with the use of prohibited solvents,

in violation of this chapter and chapter 28.6 of title 21; or

     (5) Possessing, using, distributing, cultivating, processing or manufacturing marijuana or

marijuana products which do not satisfy the requirements of this chapter and chapter 28.6 of title

21.

     21-28.11-31. Social equity assistance fund.

     (a) There shall be established and set up on the books of the state within the general fund,

a separate fund to be known as the "social equity assistance fund".

     (b) It shall, subject to appropriation, consist of all monies received on account of the state

as a result of application for and licensing of individuals and entities pursuant to the provisions of

this chapter, all civil penalties received for violations of this chapter and interest earned on balances

in the fund.

     (c) Subject to appropriation, money in the fund shall be expended for the implementation

and administration of programming for restorative justice, jail diversion, drug rehabilitation and

education workforce development for jobs related to marijuana cultivation, transportation,

distribution and sales, mentoring services for economically-disadvantaged persons in communities

disproportionately impacted by high rates of arrest and incarceration for cannabis and direct

financial assistance to economically disadvantaged persons to gain entry into lawful marijuana

business.

     (d) Disbursement from the fund may include provisions for interest free loans to pay the

application and annual licensing fee for individuals who have previously been disproportionately

impacted by criminal enforcement of marijuana laws to include individuals convicted of nonviolent

marijuana offenses, and immediate family members of individuals convicted of non-violent

marijuana offenses and for those individuals who have resided in disproportionately impacted areas

for at least five (5) of the last ten (10) years.

     (e) The director in consultation with the office of diversity, equity and opportunity shall

promulgate rules establishing the criteria, eligibility, qualifications and process for administering

disbursement of the funds.

     (f) The director shall administer the program and the authorized disbursement of funds as

appropriated.

     21-28.11-32. Tax receipts.

     Revenue collected as sales tax or state marijuana excise tax pursuant to the provisions of §

21-28.11-13 shall be paid into the state's general fund.

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     SECTION 2. Title 44 of the General Laws entitled "TAXATION" is hereby amended by

adding thereto the following chapter:

CHAPTER 70

MARIJUANA TAX

     44-70-1. Definitions.

     As used in this chapter, the following words shall, unless the context clearly requires

otherwise, have the following meanings:

     (1) "Administrator" means the state tax administrator in the department of revenue as set

forth in chapter 1 of title 44.

     (2) "Marijuana establishment", "Marijuana paraphernalia", "Marijuana products", and

"Marijuana retailer", shall have the same meanings as defined in chapter 28.11 of title 21.

     44-70-2. State exercise tax imposition -- Rate -- Payment.

     Except for a sale in compliance with the provisions of chapter 28.6 of the title 21, a state

excise tax is hereby imposed upon the sale of marijuana or marijuana products to anyone other than

a marijuana establishment at a rate of eight percent (8%) of the total sales price received by the

seller as a consideration for the sale of marijuana or marijuana products. The state excise tax shall

be levied in addition to any sales and use state tax imposed upon the sale of property or services as

provided in chapter 18 of title 44 and shall be paid by a marijuana seller to the administrator at the

time provided for filing the return required by chapter 18 of title 44.

     44-70-3. Local.

     Except for a sale in compliance with the provisions of chapter 28.6 of title 21,

municipalities may impose a local excise tax on non-medical marijuana sold by compassion centers

and marijuana retailers licensed pursuant to chapter 28.11 of title 21, which are located within the

boundaries of the municipality at a rate of five percent (5%) of the gross sales of marijuana

products. The taxes collected in accordance with this section shall be allocated such that the

municipality collecting the local excise tax shall receive sixty percent (60%) of the excise taxes

collected and the remaining forty percent (40%) of the local excise taxes collected submitted to the

state and shall be distributed in equal shares to the municipalities that have no compassion centers

or marijuana retailers located within the municipality. The said forty percent (40%) of the local

excise tax collected shall be deposited into a fund established by the department of revenue for

distribution in accordance with the provisions of this section. The marijuana retailer shall pay the

local excise tax imposed under this section to the local tax authority at the same time as the sales

tax is due to the state.

     44-70-4. Exemptions.

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     The state excise and sales tax and the local excise tax provided by this chapter shall not

apply to the sale of marijuana or marijuana products by a medical marijuana treatment center or a

registered personal caregiver to a qualifying patient, cardholder, compassion center cardholder, or

authorized purchaser pursuant to chapter 28.6 of title 21.

     44-70-5. Application of tax revenue.

     The administrator shall deposit revenue collected pursuant to this chapter from the state

excise tax and the sales tax into the general fund.

     44-70-6. Rates of taxation.

     The general assembly may adjust the rate of taxation provided for in this chapter from time

to time. The director and the department of revenue may make such recommendations to the general

assembly as the director and the department of revenue deem appropriate in regard to the rate of

taxation set forth in this chapter.

     SECTION 3. Section 21-28.6-12 of the General Laws in Chapter 21-28.6 entitled "The

Edward O. Hawkins and Thomas C. Slater Medical Marijuana Act" is hereby amended to read as

follows:

     21-28.6-12. Compassion centers.

     (a) A compassion center licensed under this section may acquire, possess, cultivate,

manufacture, deliver, transfer, transport, supply, or dispense medical marijuana, or related supplies

and educational materials, to registered qualifying patients and their registered primary caregivers

or authorized purchasers, or out-of-state patient cardholders or other marijuana establishment

licensees. Except as specifically provided to the contrary, all provisions of this chapter (the Edward

O. Hawkins and Thomas C. Slater medical marijuana act), apply to a compassion center unless the

provision(s) conflict with a provision contained in this section.

     (b) License of compassion centers -- authority of the departments of health and business

regulation:

     (1) Not later than ninety (90) days after the effective date of this chapter, the department

of health shall promulgate regulations governing the manner in which it shall consider applications

for licenses for compassion centers, including regulations governing:

     (i) The form and content of license and renewal applications;

     (ii) Minimum oversight requirements for compassion centers;

     (iii) Minimum record-keeping requirements for compassion centers;

     (iv) Minimum security requirements for compassion centers; and

     (v) Procedures for suspending, revoking, or terminating the license of compassion centers

that violate the provisions of this section or the regulations promulgated pursuant to this subsection.

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     (2) Within ninety (90) days of the effective date of this chapter, the department of health

shall begin accepting applications for the operation of a single compassion center.

     (3) Within one hundred fifty (150) days of the effective date of this chapter, the department

of health shall provide for at least one public hearing on the granting of an application to a single

compassion center.

     (4) Within one hundred ninety (190) days of the effective date of this chapter, the

department of health shall grant a single license to a single compassion center, providing at least

one applicant has applied who meets the requirements of this chapter.

     (5) If at any time after fifteen (15) months after the effective date of this chapter, there is

no operational compassion center in Rhode Island, the department of health shall accept

applications, provide for input from the public, and issue a license for a compassion center if a

qualified applicant exists.

     (6) Within two (2) years of the effective date of this chapter, the department of health shall

begin accepting applications to provide licenses for two (2) additional compassion centers. The

department shall solicit input from the public, and issue licenses if qualified applicants exist.

     (7)(i) Any time a compassion center license is revoked, is relinquished, or expires on or

before December 31, 2016, the department of health shall accept applications for a new compassion

center.

     (ii) Any time a compassion center license is revoked, is relinquished, or expires on or after

January 1, 2017, the department of business regulation shall accept applications for a new

compassion center.

     (8)(i) If at any time after three (3) years after the effective date of this chapter and on or

before December 31, 2016, fewer than three (3) compassion centers are holding valid licenses in

Rhode Island, the department of health shall accept applications for a new compassion center. If at

any time on or after January 1, 2017, fewer than three (3) compassion centers are holding valid

licenses in Rhode Island, the department of business regulation shall accept applications for a new

compassion center. There shall be nine (9) compassion centers that may hold valid licenses at one

time. If at any time on or after July 1, 2019, fewer than nine (9) compassion centers are holding

valid licenses in Rhode Island, the department of business regulation shall accept applications for

new compassion centers and shall continue the process until nine (9) licenses have been issued by

the department of business regulation.

     (9) Any compassion center application selected for approval by the department of health

on or before December 31, 2016, or selected for approval by the department of business regulation

on or after January 1, 2017, shall remain in full force and effect, notwithstanding any provisions of

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this chapter to the contrary, and shall be subject to state law adopted herein and rules and regulations

adopted by the departments of health and business regulation subsequent to passage of this

legislation.

     (10) A licensed cultivator may apply for, and be issued, an available compassion center

license, provided that the licensed cultivation premises is disclosed on the compassion center

application as the permitted second location for growing medical marijuana in accordance with

subsection (c)(i) of this section. If a licensed cultivator is issued an available compassion center

license, their cultivation facility license will merge with and into their compassion center license in

accordance with regulations promulgated by the department of business regulation. Once merged,

the cultivation of medical marijuana may then be conducted under the compassion center license

in accordance with this section and the cultivation license will be considered null and void and of

no further force or effect.

     (c) Compassion center and agent applications and license:

     (1) Each application for a compassion center shall be submitted in accordance with

regulations promulgated by the department of business regulation and shall include, but not be

limited to:

     (i) A non-refundable application fee paid to the department in the amount of ten thousand

dollars ($10,000);

     (ii) The proposed legal name and proposed articles of incorporation of the compassion

center;

     (iii) The proposed physical address of the compassion center, if a precise address has been

determined, or, if not, the general location where it would be located. This may include a second

location for the cultivation of medical marijuana;

     (iv) A description of the enclosed, locked facility that would be used in the cultivation of

medical marijuana;

     (v) The name, address, and date of birth of each principal officer and board member of the

compassion center;

     (vi) Proposed security and safety measures that shall include at least one security alarm

system for each location, planned measures to deter and prevent the unauthorized entrance into

areas containing marijuana and the theft of marijuana, as well as a draft, employee-instruction

manual including security policies, safety and security procedures, personal safety, and crime-

prevention techniques; and

     (vii) Proposed procedures to ensure accurate record keeping.

     (2)(i) For applications submitted on or before December 31, 2016, any time one or more

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compassion center license applications are being considered, the department of health shall also

allow for comment by the public and shall solicit input from registered qualifying patients,

registered primary caregivers, and the towns or cities where the applicants would be located;

     (ii) For applications submitted on or after January 1, 2017, any time one or more

compassion center license applications are being considered, the department of business regulation

shall also allow for comment by the public and shall solicit input from registered qualifying

patients, registered primary caregivers, and the towns or cities where the applicants would be

located.

     (3) Each time a new compassion center license is issued, the decision shall be based upon

the overall health needs of qualified patients and the safety of the public, including, but not limited

to, the following factors:

     (i) Convenience to patients from areas throughout the state of Rhode Island;

     (ii) The applicant's ability to provide a steady supply to the registered qualifying patients

in the state;

     (iii) The applicant's experience running a non-profit or business;

     (iv) The interests of qualifying patients regarding which applicant be granted a license;

     (v) The interests of the city or town where the dispensary would be located taking into

consideration need and population;

     (vi) Nothing herein shall prohibit more than one compassion center being geographically

located in any city or town;

     (vii) The sufficiency of the applicant's plans for record keeping and security, which records

shall be considered confidential healthcare information under Rhode Island law and are intended

to be deemed protected healthcare information for purposes of the Federal Health Insurance

Portability and Accountability Act of 1996, as amended; and

     (viii) The sufficiency of the applicant's plans for safety and security, including proposed

location, security devices employed, and staffing.

     (4) A compassion center approved by the department of health on or before December 31,

2016, shall submit the following to the department before it may begin operations:

     (i) A fee paid to the department in the amount of five thousand dollars ($5,000);

     (ii) The legal name and articles of incorporation of the compassion center;

     (iii) The physical address of the compassion center; this may include a second address for

the secure cultivation of marijuana;

     (iv) The name, address, and date of birth of each principal officer and board member of the

compassion center; and

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     (v) The name, address, and date of birth of any person who will be an agent of, employee,

or volunteer of the compassion center at its inception.

     (5)(i) A compassion center approved or renewed by the department of business regulation

on or after January 1, 2017, but before July 1, 2019, shall submit materials pursuant to regulations

promulgated by the department of business regulation before it may begin operations:

     (A) A fee paid to the department in the amount of five thousand dollars ($5,000);

     (B) The legal name and articles of incorporation of the compassion center;

     (C) The physical address of the compassion center; this may include a second address for

the secure cultivation of medical marijuana;

     (D) The name, address, and date of birth of each principal officer and board member of the

compassion center;

     (E) The name, address, and date of birth of any person who will be an agent, employee, or

volunteer of the compassion center at its inception.

     (ii) A compassion center approved or renewed by the department of business regulation on

or after July 1, 2019, shall submit materials pursuant to regulations promulgated by the department

of business regulation before it may begin operations, which shall include but not be limited to:

     (A) A fee paid to the department in the amount of five hundred thousand dollars

($500,000);

     (B) The legal name and articles of incorporation of the compassion center;

     (C) The physical address of the compassion center; this may include a second address for

the secure cultivation of medical marijuana;

     (D) The name, address, and date of birth of each principal officer and board member of the

compassion center, and any person who has a direct or indirect ownership interest in any marijuana

establishment licensee, which ownership interest shall include, but not be limited to, any interests

arising pursuant to the use of shared management companies, management agreements or other

agreements that afford third-party management or operational control, or other familial or business

relationships between compassion center or cultivator owners, members, officers, directors,

managers, investors, agents, or key persons that effect dual license interests as determined by the