2024 -- H 7855

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LC005430

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2024

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A N   A C T

RELATING TO FOOD AND DRUGS -- THE RHODE ISLAND CANNABIS ACT

     Introduced By: Representatives Felix, Slater, Morales, Sanchez, Henries, Batista, J.
Lombardi, Kislak, Potter, and Cruz

     Date Introduced: March 01, 2024

     Referred To: House Finance

     It is enacted by the General Assembly as follows:

     SECTION 1. Sections 21-28.11-3, 21-28.11-5, 21-28.11-12.1 and 21-28.11-31 of the

General Laws in Chapter 21-28.11 entitled "The Rhode Island Cannabis Act" are hereby amended

to read as follows:

     21-28.11-3. Definitions.

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

following meanings:

     (1) “Administrator” means the administrator of the cannabis office appointed by the

governor pursuant to the provisions of § 21-28.11-18.1.

     (2) “Adult use cannabis” or “recreational cannabis” means cannabis which may be legally

possessed and consumed for non-medical purposes by a person who is at least twenty-one (21)

years of age.

     (3) “Applicant” means a Rhode Island resident or a business entity with a principal place

of business located in Rhode Island to include, but not limited to, a corporation, limited liability

company, limited liability partnership or partnership, and in which fifty-one percent (51%) of the

equity in the business entity is owned by residents of Rhode Island, and the Rhode Island resident

or business entity has made application for issuance of a license or certificate to own or engage in

a cannabis business subject to the provisions of this chapter.

     (4) “Cannabinoid’' means any of several compounds produced by cannabis plants that have

medical and psychotropic effects.

     (5) “Cannabinoid profile” means amounts, expressed as the dry-weight percentages, of

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

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

     (6) “Cannabis” or “marijuana” or “marihuana” means all parts of any plant of the genus

cannabis not excepted herein, 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

“cannabis” 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

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

administrations, food, drink or other products.

     (7) “Cannabis accessories” or “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 cannabis into the human body.

     (8) “Cannabis advisory board” or “advisory board” means the cannabis advisory board

established pursuant to the provisions of § 21-28.11-6.

     (9) “Cannabis 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 combined with cannabis to prepare

cannabis products.

     (10) “Cannabis control commission” or “commission” means the Rhode Island cannabis

control commission established by § 21-28.11-4.

     (11) “Cannabis cultivator” or “marijuana cultivator” means an entity licensed to cultivate,

process and package cannabis, to deliver cannabis to cannabis establishments and to transfer

cannabis to other cannabis establishments, but not to consumers.

     (12) “Cannabis establishment” or “marijuana establishment” means a cannabis cultivator,

cannabis testing laboratory, cannabis product manufacturer, cannabis retailer, hybrid cannabis

retailer or any other type of licensed cannabis-related business.

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     (13) “Cannabis office” means the office established pursuant to § 21-28.11-18.1.

     (14) “Cannabis product manufacturer” or “marijuana product manufacturer”' means an

entity licensed to obtain, manufacture, process and package cannabis and cannabis products, to

deliver cannabis and cannabis products to cannabis establishments and to transfer cannabis and

cannabis products to other cannabis establishments, but not to consumers.

     (15) “Cannabis products” or “marijuana products” means products that have been

manufactured and contain cannabis or an extract from cannabis, including concentrated forms of

cannabis and products composed of cannabis and other ingredients that are intended for use or

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

     (16) “Cannabis retailer” or “marijuana retailer” means an entity licensed pursuant to § 21-

28.11-10.2 to purchase and deliver cannabis and cannabis products from cannabis establishments

and to deliver, sell or otherwise transfer cannabis and cannabis products to cannabis establishments

and to consumers.

     (17) “Cannabis testing laboratory’' means a third-party analytical testing laboratory that is

licensed annually by the commission, in consultation with the department of health, to collect and

test samples of cannabis and cannabis products pursuant to regulations issued by the commission

and is:

     (i) Independent financially from any medical cannabis treatment center or any licensee or

cannabis establishment for which it conducts a test; and

     (ii) Qualified to test cannabis in compliance with regulations promulgated by the

commission pursuant to this chapter. The term includes, but is not limited to, a cannabis testing

laboratory as provided in § 21-28.11-11.

     (18) “Chairperson” means the chairperson of the cannabis control commission established

pursuant to § 21-28.11-4.

     (19) “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.

     (20) “Consumer” means a person who is at least twenty-one (21) years of age, and who is

authorized by law to consume or use cannabis.

     (21) “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 cannabis establishment.

     (22) “Cultivation batch” means a collection of cannabis plants from the same seed or plant

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

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

regimes and agricultural or hydroponic inputs. Every cannabis 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.

     (23) “Disproportionately impacted area” means a census tract or comparable geographic

area that satisfies at least one of the following criteria as determined by the commission, that:

     (i) The area has a poverty rate of at least twenty percent (20%) according to the latest

federal decennial census;

     (ii) Seventy-five percent (75%) or more of the children in the area participate in the federal

free lunch program according to reported statistics from the Rhode Island board of education;

     (iii) At least twenty percent (20%) of the households in the area receive assistance under

the Supplemental Nutrition Assistance Program (SNAP);

     (iv) The area has an average unemployment rate, as determined by the Rhode Island

department of labor and training, that is more than one hundred twenty percent (120%) of the

national unemployment average, as determined by the United States Department of Labor, for a

period of at least two (2) consecutive calendar years preceding the date of the application; or

     (v)(A) The area has disproportionately high rates of arrest, conviction, and incarceration

related to the sale, possession, use, cultivation, manufacture, or transportation of cannabis in

comparison to other communities and localities in the state; or

     (B) The area has a history of arrests, convictions, and other law enforcement practices in a

certain geographic area, such as, but not limited to, precincts, zip codes, neighborhoods, and

political subdivisions, reflecting a disparate enforcement of cannabis prohibition during a certain

time period, when compared to the remainder of the state.

     (vi) The commission shall, with recommendations from the cannabis advisory board and

the chief equity officer, issue guidelines to determine how to assess which communities have been

disproportionately impacted and how to assess if someone is a member of a community

disproportionately impacted.

     (24) “Final issuance of the commission’s rules and regulations” means the rules and

regulations adopted by the commission after compliance with requirements of chapter 35 of title

42 (the “administrative procedures act”) and chapter 46 of title 42 (the “open meetings act”) and

shall not include any emergency, provisional or interim rules, regulations, requirements, orders,

instructions or procedures.

     (25) “Finished cannabis” means a usable cannabis, cannabis resin or cannabis concentrate.

     (26) “Hemp” means the plant of the genus cannabis or any part of the plant, whether

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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 per cent of delta-9-tetrahydrocannabinol

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

content.

     (27) “Host community” means a municipality in which a cannabis establishment or a

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

cannabis establishment or a medical cannabis treatment center.

     (28) “Hybrid cannabis retailer” or “hybrid compassion center” means a compassion center

licensed pursuant to chapter 28.6 of this title that is in good standing with the department of business

regulation and that has paid the fee pursuant to § 21-28.11-10 and has been authorized to sell non-

medical or adult use cannabis to consumers.

     (29) “Laboratory agent” means a registered employee of a cannabis testing laboratory who

transports, possesses or tests cannabis.

     (30) “Licensee” means a person or entity licensed by the commission pursuant to the

provisions of this chapter. Any business structure recognized under 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 commission as an

entity licensee.

     (31) “Manufacture” means to compound, blend, extract, infuse or otherwise make or

prepare a cannabis product.

     (32) “Medical cannabis” means cannabis and cannabis products that satisfy the

requirements of chapter 28.6 of this title and have been given the designation of “medical cannabis”

or “medical marijuana” due to dose, potency and form. Medical cannabis products are only

available for use by patient cardholders, and may only be sold to or possessed by patient

cardholders, or their registered caregiver, or authorized purchaser in accordance with chapter 28.6

of this title. Medical cannabis may not be sold to, possessed by, manufactured by, or used by any

person except as permitted pursuant to chapter 28.6 of this title.

     (33) “Medical cannabis treatment center” or “Medical marijuana treatment center” includes

a compassion center, a medical marijuana emporium, or marijuana establishment licensee who

operates a treatment center, as defined in § 21-28.6-3.

     (34) “Member of an impacted family” means an individual who has a parent, legal

guardian, child, spouse, or dependent, or was a dependent of an individual who, prior to the

effective date of this chapter, was arrested for, charged with, convicted of, or adjudicated delinquent

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for any offense that is eligible for expungement under this chapter.

     (35) “Ownership and control” means ownership of at least fifty-one percent (51%) of the

cannabis establishment, and control over the management and day-to-day operations of the

cannabis establishment, and an interest in the capital, assets, and profits and losses of the cannabis

establishment proportionate to percentage of ownership.

     (36) “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.

     (37) “Production batch” means a batch of finished plant material, cannabis resin, cannabis

concentrate or cannabis-infused product made at the same time, using the same methods, equipment

and ingredients. The commission shall require licensees to 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 cannabis

cultivation batches.

     (38) “Residual solvent” means a volatile organic chemical used in the manufacture of a

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

     (39) “Social equity applicant” means an applicant that has been disproportionately

impacted by criminal enforcement of marijuana laws, including individuals convicted of nonviolent

marijuana offenses, immediate family members of individuals convicted of nonviolent marijuana

offenses and individuals who have resided in disproportionately impacted areas for at least five (5)

of the last ten (10) years, as determined by the commission after consultation with the cannabis

advisory board, and further specified in the rules and regulations that shall identify factors and other

considerations to be evaluated in certifying applicants as social equity applicants, provided that

such applicants shall at a minimum meet one of the following criteria:

     (i) An applicant with at least fifty-one percent (51%) ownership and control by one or more

individuals who have resided for at least five (5) of the preceding ten (10) years in a

disproportionately impacted area.

     (ii) An applicant with at least fifty-one percent (51%) ownership and control by one or

more individuals who:

     (A) Have been arrested for, convicted of, or adjudicated delinquent for any offense that is

eligible for expungement under this chapter; or

     (B) Is a member of an impacted family.

     (iii) For applicants with a minimum of ten (10) full-time employees, an applicant with at

least fifty-one percent (51%) of current employees who:

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     (A) Currently reside in a disproportionately impacted area; or

     (B) Have been arrested for, convicted of, or adjudicated delinquent for any offense that is

eligible for expungement under this chapter or is a member of an impacted family.

     (C) The approved licensee under this subsection shall pay an annual social equity status

fee of five hundred thousand dollars ($500,000) to the commission.

     (iv) Can demonstrate significant past experience in or business practices that promote

economic empowerment in disproportionally impacted areas. Any approved licensee under this

subsection must pay an annual fee of five hundred thousand dollars ($500,000) to the commission

in order to maintain the social equity applicant status and the funds collected shall be deposited into

the social equity assistance fund to be used exclusively for public education and affordable housing

in the community closest to the licensee's location that qualifies as a disproportionately affected

area.

     (v) Had income which does not exceed four hundred percent (400%) of the median income,

as defined by the commission, in a disproportionally impacted area for at least five (5) of the past

ten (10) years.

     (40) “Terpenoid” means an isoprene that are the aromatic compounds found in cannabis,

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

caryophyllene, caryophyllene oxide, nerolidol and phytol.

     (41) “Unreasonable and impracticable” means that the measures necessary to comply with

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

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

prudent businessperson would not operate a cannabis establishment.

     (42) “Workers’ cooperative” means an applicant organized and operated pursuant to the

provisions of chapter 6.2 of title 7.

     21-28.11-5. Powers and duties of the commission.

     (a) Subject to the state code of ethics and any internal ethics code adopted by the

commission, the commission shall have all the powers necessary and reasonable to carry out and

effectuate its purposes, including, but not limited to, the power to:

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

and enforcement of this chapter;

     (2) Determine which applicants shall be awarded licenses;

     (3) Deny an application or limit, condition, restrict, revoke or suspend any license;

     (4) Determine and establish the process and methodology by which licenses shall be

awarded by the commission;

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     (5) 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;

     (6) Establish a registration process;

     (7) Execute all instruments necessary and appropriate, in the commission’s discretion, to

fulfill the purposes of this chapter;

     (8) 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 its powers and

duties under this chapter;

     (9) Appear on its own behalf before boards, commissions, departments or other agencies

of municipal, state or federal government;

     (10) 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

subject to appropriation by the general assembly;

     (11) Subject to appropriation by the general assembly, provide and pay for advisory

services and technical and other assistance including the hiring of appropriate support staff

personnel as may be necessary in its judgment to carry out the purpose and intent of this chapter,

and subject to applicable law, fix the compensation of persons providing such services or

assistance;

     (12) Prepare, publish and distribute, with or without charge as the commission may

determine, such studies, reports, bulletins and other materials as required by the provisions of this

chapter or other applicable law or as the commission considers appropriate;

     (13) Review data and market conditions on an annual basis to determine and recommend

the maximum number of licenses that shall be issued to meet the production demands to implement

the provisions of this chapter subject to enactment by the general assembly;

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

title 42 (the “administrative procedures act”) 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;

     (15) Gather facts and information and take action applicable to the commission’s

obligations pursuant to this chapter relating to:

     (i) Any violation of this chapter or any rule or regulation adopted by the commission; and

     (ii) Any willful violation of an order of the commission directed to a licensee or a person

required to be registered;

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     (iii) The conviction of a criminal offense, for the purpose of determining whether said

conviction substantially relates to the occupation or activity to which the license or registration

applies;

     (iv) Any other action or conduct which would disqualify a licensee from holding a license

pursuant to the provisions of this chapter;

     (16) In connection with matters having to do with the discharge of the duties of the

commission pursuant to this chapter, the chairperson of the commission, in cases pending before

the commission, is hereby authorized and empowered to summon witnesses to attend and testify in

a like manner as in either the supreme or superior courts. The commission is authorized to compel

the production of all papers, books, documents, records, certificates, or other legal evidence that

may be necessary for the determination and the decision of any question or the discharge of any

duty required by law of the commission, by issuing a subpoena duces tecum signed by the

chairperson. Any person who shall willfully swear falsely in any proceedings, matter, or hearing

before the commission shall be subject to the law pertaining to the crime of perjury. Any person

who disobeys may be referred by the chairperson of the commission to the presiding justice of the

superior court for assignment of a hearing on civil contempt citation and/or to the attorney general

for criminal contempt prosecution;

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

commission, the cannabis office and all applicants for licensure pursuant to the provisions of this

chapter;

     (18) 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 record information relating to criminal and background

investigations as necessary for the purpose of evaluating licensees, applicants for licenses,

laboratory agents, and any other employee or agent of a cannabis establishment, as determined by

the commission or otherwise required by law;

     (19) Be present, through its designated inspectors and agents, at any reasonable time, in

cannabis establishments for the purposes of exercising its powers and duties;

     (20) Inspect cannabis establishments and have access to all equipment and supplies in a

cannabis establishment for the purpose of ensuring and enforcing compliance with this chapter,

chapter 28.6 of this title, and all rules and regulations promulgated pursuant to this chapter and

chapter 28.6 of this title;

     (21) In accordance with all applicable law, coordinate with the state police to seize,

impound and remove from the premises of a cannabis establishment any cannabis, equipment,

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supplies, documents and records obtained or possessed in violation of this chapter, chapter 28.6 of

this title, or the rules and regulations of the commission;

     (22) Require that the books and financial or other records or statements of a licensee be

kept in a manner that the commission deems proper;

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

associates of a licensee whom the commission reasonably 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;

     (24) Impose and collect fees, sanctions and administrative penalties, as authorized by this

chapter and established by regulation, and for a violation of any rule or regulation promulgated by

the commission except as of December 1, 2022, no fee shall be authorized or imposed for registry

identification cards or for plant tags;

     (25) Establish adjudicatory procedures and conduct adjudicatory proceedings pursuant to

the provisions of chapter 35 of title 42 (the “administrative procedures act”);

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

authorities;

     (27) Maintain an official Internet website for the commission that, in the discretion of the

commission, may be in coordination with the cannabis office;

     (28) Submit any matter to the advisory board for study, review or recommendation;

     (29) Request and/or approve or disapprove recommendations by the cannabis advisory

board made pursuant to § 21-28.11-6 to include, but not be limited to, distribution of funds from

the social equity assistance fund established pursuant to § 21-28.11-31; provided, however, such

recommendations shall be disclosed to the public, and justifications issued whenever

recommendations are rejected.

     (30) Monitor any federal activity regarding cannabis;

     (31) Delegate any administrative, procedural or operational matter to the cannabis office;

     (32) Issue temporary emergency orders, directives or instructions, with or without prior

notice or hearing, in an instance in which the public health or safety is in substantial or imminent

danger as it relates to the activities, conduct or practices of a licensee or as a result of a defective

or dangerous product offered for sale by a licensee. If a temporary emergency order, directive or

instruction without notice or a hearing is issued by the commission then the order, directive or

instruction shall expire after ten (10) days unless a hearing is noticed by the commission within the

ten (10) day period, and the hearing is scheduled to be conducted within twenty (20) days of the

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issuance of the order, directive or instruction;

     (33) Amend forms, procedures and requirements adopted by the office of cannabis

regulation pursuant to § 21-28.11-10.1 related to the temporary regulation of cultivation,

manufacture and sale of cannabis for adult use by hybrid cannabis retailers during the transitional

period established by § 21-28.11-10.1; and

     (34) Provide recommendations to the general assembly regarding any advisable or

proposed amendments to chapter 26 of title 2 relative to the regulation of industrial hemp and the

use of hemp as a commercial product.

     (b) The commission shall, pursuant to subsection (a) of this section, adopt rules and

regulations consistent with this chapter for the administration, clarification and enforcement of

provisions regulating and licensing cannabis establishments and the sale, possession and use of

cannabis. 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 commission;

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

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

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

and demonstrably related to the operation of a cannabis 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 of the general laws; provided, that a criminal

conviction relating solely to the possession of marijuana or cannabis shall not automatically

disqualify an individual from eligibility for employment or licensure in connection with a cannabis

establishment pursuant to § 21-28.11-12.1;

     (5) In consultation with the cannabis advisory board, identification of factors to be

evaluated in the approval and certification of social equity applicants and establishment of

procedures and policies to promote and encourage full participation in the regulated cannabis

industry by people from communities that have previously been disproportionately harmed by

cannabis prohibition and enforcement;

     (6) In accordance with all applicable law, standards for the payment or reporting of

licensure fees and taxes;

     (7) Requirements for the information to be furnished by a licensee to the licensee’s

employees;

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

license or a licensee and the employees of licensees;

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

     (10) Minimum uniform standards of accounting procedures;

     (11) Requirements for record keeping by cannabis establishments and procedures to track

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

     (12) 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 cannabis cultivated, processed or

manufactured pursuant to this chapter;

     (13) Standards and procedures to leverage seed-to-sale tracking technology which may

allow for the appropriate transfer or acquisition of cannabis seeds, clones, cuttings, plants or plant

tissue between medical and nonmedical establishments;

     (14) Registration requirements for employees of cannabis establishments including

ensuring that employees be properly trained in the performance of their duties as necessary;

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

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

use of security personnel, security cameras, or alarms;

     (16) Minimum standards for liability insurance coverage;

     (17) Requirements and procedures, utilizing best practices, to prevent the sale, delivery or

transfer of cannabis to persons under twenty-one (21) years of age, or the purchase of cannabis on

behalf of a person under twenty-one (21) years of age to include, but not limited to, the

establishment of age verification procedures;

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

for the cultivation, processing, manufacturing and distribution of cannabis, 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;

     (19) Requirements for the packaging and labeling of cannabis and cannabis 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.; and

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

making packaging certified child-resistant and resealable;

     (20) Requirements and restrictions for advertising, marketing and branding of cannabis and

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cannabis products;

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

cannabis, which shall consider policies which promote the reasonable remediation and/or recycling

of such waste, including, but not limited to, recycled industrial products;

     (22) Procedures and requirements to enable the transfer of a license for a cannabis

establishment to another qualified person or to another suitable location in compliance with the

provisions of § 21-28.11-10.2 following notification and approval by the commission; provided

however, that a license issued to a social equity applicant shall only be transferred to another

qualified social equity applicant, and a license issued to a workers’ cooperative applicant shall only

be transferred to another qualified workers’ cooperative applicant;

     (23) Requirements to establish a process allowing the commission to order a prohibition

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

of age including a means for allowing a cannabis product manufacturer to voluntarily submit a

product, its packaging and intended marketing to the commission for preliminary determination

whether the product is especially appealing to persons under twenty-one (21) years of age;

     (24) Requirements that may prohibit cannabis product manufacturers from altering or

utilizing commercially-manufactured food products when manufacturing cannabis products unless

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

manufacturer to infuse with cannabis;

     (25) Energy and environmental standards for licensure and licensure renewal of cannabis

establishments licensed as a cannabis cultivator or cannabis product manufacturer;

     (26) If determined necessary to protect or promote public health and safety, the commission

may establish reasonable limits for cannabis product potency and/or dosing; provided that, in the

interest of maintaining a stable cannabis market, before imposing such limits, the commission shall

give due consideration to the limits on potency and/or dosing imposed by neighboring states;

     (27) The testing and safety of cannabis and cannabis products, including but not limited to,

regulations promulgated by the commission in consultation with the department of health, as

applicable which:

     (i) License and regulate the operation of cannabis laboratory testing facilities, including

requirements for equipment, training, and qualifications for personnel;

     (ii) Set forth procedures that require random sample testing to ensure quality control,

including, but not limited to, ensuring that cannabis and cannabis products are accurately labeled

for tetrahydrocannabinol (THC) content and any other product profile;

     (iii) Establish testing for residual solvents or toxins; harmful chemicals; dangerous molds

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or mildew; filth; and harmful microbials such as E. coli or salmonella and pesticides, and any other

compounds, elements, or contaminants;

     (iv) Require that all cannabis and cannabis products must undergo random sample testing

at a licensed cannabis testing facility or other laboratory equipped to test cannabis and cannabis

products that have been approved by the commission;

     (v) Require any products which fail testing be quarantined and/or recalled and destroyed

in accordance with regulations;

     (vi) Allow for the establishment of other quality assurance mechanisms which may include

but not be limited to, the designation or creation of a reference laboratory, creation of a secret

shopper program, round robin testing, or any other mechanism to ensure the accuracy of product

testing and labeling;

     (vii) Require cannabis establishment licensees and cannabis products to comply with any

applicable food safety requirements determined by the commission and/or the department of health;

     (viii) Include any additional requirements deemed necessary by the commission as

determined in consultation with the department of health; and

     (ix) Allow the commission, in coordination with the department of health, at their

discretion, to temporarily remove, or phase in, any requirement for laboratory testing if it finds that

there is not sufficient laboratory capacity for the market;

     (28) Standards and restrictions for cannabis manufacturing and processing which shall

include, but not be limited to, requirements that cannabis processors:

     (i) Comply with all applicable building and fire codes;

     (ii) Receive approval from the state fire marshal’s office for all forms of manufacturing

that use a heat source or flammable solvent;

     (iii) Require any cannabis processor that manufactures edibles of cannabis infused food

products to comply with all applicable requirements and regulations and obtain a food business

license as defined by § 21-27-1 issued by the department of health’s office of food safety; and

     (iv) Comply with any other requirements deemed suitable by the commission;

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

     (30) General operating requirements, minimum oversight, and any other activities,

functions, or aspects of a cannabis establishment licensee in furtherance of creating a stable,

regulated cannabis industry and mitigating its impact on public health and safety;

     (31) Rules and regulations based on federal law, provided such rules and regulations are

designed to comply with federal guidance and mitigate federal enforcement against the cannabis

establishments and adult use establishments authorized, licensed and operated pursuant to this

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chapter;

     (32) Coordinate and implement the transition and transfer of regulatory authority of

medical marijuana from the department of business regulation to the commission; and

     (33) Requirements that, after March 1, 2023, according to a timeline determined by the

commission, patients with out-of-state medical marijuana cards must also possess and produce a

valid government issued identification demonstrating residency in the same state jurisdiction that

issued the medical marijuana card.

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

     (1) Except to protect public health and safety, prohibit the operation of a cannabis

establishment either expressly or through regulations that make operation of a cannabis

establishment unreasonable and impracticable;

     (2) Require an adult retail purchaser to provide a cannabis retailer with identifying

information other than proper identification to determine the customer’s age, and shall not require

the cannabis retailer to acquire or record personal information about customers other than

information typically required in a retail transaction;

     (3) Except as provided pursuant to chapter 28.6 of this title, authorize a cannabis retailer,

medical marijuana treatment center or a hybrid cannabis retailer to operate at a shared location with

a cultivator;

     (4) Authorize a cannabis establishment to transfer or acquire cannabis seeds, clones,

cuttings, plants or plant tissue to or from another cannabis establishment unless notice of the

transfer or acquisition is provided to the commission; or

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

     (d) Reports. In furtherance of the intent of this chapter:

     (1) The commission shall annually submit a complete and detailed report of the

commission’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.

     (2) The commission 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.

     (3) Each fiscal year the commission 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.

     (4) The commission may study cannabis commerce and make recommendations to the

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general assembly regarding changes to existing law that further the intent of this chapter by

reporting those recommendations to the governor, the speaker of the house, and the president of

the senate.

     (5) The commission may conduct an analysis and report to the general assembly if it finds

that conditions are appropriate for the issuance of additional types or classes of licenses to operate

cannabis-related businesses, including, but not limited to:

     (i) Licenses that authorize limited or restricted cultivation, processing, manufacture,

possession or storage of cannabis or cannabis products, limited delivery of cannabis or cannabis

products to consumers;

     (ii) Licenses that authorize the consumption of cannabis or cannabis products on the

premises where sold;

     (iii) Licenses that authorize the consumption of cannabis at special events in limited areas

and for a limited time; and

     (iv) Licenses intended to facilitate scientific research or education.

     (e) The commission shall administer and enforce the provisions of this chapter and the rules

and regulations relating to licensing in this chapter and in its discretion and where appropriate may

delegate and authorize various administration and enforcement powers and duties to the cannabis

office.

     (f) The commission may investigate, in conjunction with the department of health, the

effects of cannabis and cannabis products with a high potency of tetrahydrocannabinol on human

health and consider restrictions on the potency of tetrahydrocannabinol in cannabis and cannabis

products that are necessary for protection of public health or safety in accordance with the

provisions of subsection (b)(26) of this section.

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

     (h) The commission shall cause to be deposited all fees and monetary penalties collected

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

excluding medical compassion center license fees pursuant to § 21-28.6-12, tax penalties and any

funds designated to be deposited in the marijuana trust fund pursuant to § 21-28.11-13(d).

     (i) The commission shall work collaboratively with other state agencies and departments

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

furtherance of this chapter.

     21-28.11-12.1. Criminal record information — Permitted use.

     (a) The commission shall require all applicants for license and registration under this

chapter to undergo a national criminal background check prior to issuing any license or registration.

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The applicant 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 background 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. 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

also inform the commission, 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 commission, in writing, of

this fact. The applicant shall be responsible for any expense associated with the national

background check.

     (b) All applicants for license or registration have a duty to truthfully and fully disclose prior

criminal convictions to the commission and any information the commission requests related to

said convictions. If issued a license or registration by the commission, licensees have a continuing

duty to truthfully and fully disclose any subsequent criminal convictions to the commission, along

with any information the commission requests related to said convictions. Failure to do so may

result in the denial, suspension, or revocation of a license or registration, and criminal prosecution

pursuant to § 21-28.11-27 and/or other applicable law.

     (c) “Conviction” as used throughout this chapter shall have the same meaning as set forth

in § 21-28.6-6(g).

     (d) No person shall be automatically disqualified to practice, pursue, or engage in any

business or activity licensed or registered by the commission pursuant to the provisions of this

chapter, solely relating to a prior conviction of a cannabis or marijuana possession crime or crimes

unless:

     (1) The underlying crime or crimes involved the distribution of a controlled substance,

including cannabis or marijuana, to a minor; or

     (2) The underlying crime or crimes substantially relates to the occupation to which the

license or registration applies. Any other state law to the contrary will be superseded by this

provision.

     (e) No occupational license or registration issued by the commission shall be suspended or

revoked, solely or in part, because of a prior or subsequent possession of cannabis or marijuana

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offense conviction of a crime or crimes unless the underlying crime or crimes substantially relate

to the occupation to which the license or registration applies. Any other state law to the contrary

will be superseded by this provision.

     (f) A person who has been convicted of a crime may be disqualified to practice, pursue or

engage in any business activity licensed by the commission pursuant to this chapter or chapter 28.6

of this title if the commission determines that the circumstances of the conviction are substantially

related to the occupation for which the license or registration is sought. In determining if a

conviction substantially relates to the occupation for which the license or registration is sought, the

commission shall consider:

     (1) The state’s legitimate interest in protecting the property and the safety and welfare of

specific individuals or the general public;

     (2) The relationship of the crime or crimes to the ability, capacity, and fitness required to

perform the duties and discharge the responsibilities of the position of employment or occupation;

and

     (3) The state’s legitimate interest in equal access to employment for individuals who have

had past contact with the criminal justice system.

     (g) A person who has been convicted of a crime or crimes that substantially relates to the

occupation for which a license is sought may not be automatically disqualified from the occupation

if the person can establish by competent evidence, satisfactory in the discretion of the commission,

of sufficient rehabilitation and present fitness to perform the duties of the occupation for which the

license is sought. The commission shall consider the time elapsed since the conviction when

determining sufficient rehabilitation,. Specifically, convictions issued prior to five (5) years before

the date of the application shall be deemed evidence of sufficient rehabilitation, as well as any

evidence presented by the applicant regarding:

     (1) Completion of a period of at least two (2) years after release from imprisonment, or at

least two (2) years after the sentencing date for a probation sentence or suspended sentence not

accompanied by incarceration, without subsequent conviction or pending criminal charge;

     (2) The nature, seriousness, and relevance of the crime or crimes for which convicted;

     (3) All circumstances relative to the crime or crimes, including mitigating circumstances

surrounding the commission of the crime or crimes;

     (4) The age of the person at the time the crime or crimes were committed;

     (5) Claims that the criminal record information is in error or inadmissible; and

     (6) All other competent evidence of rehabilitation and present fitness presented, including,

but not limited to, letters of reference by persons who have been in contact with the applicant since

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the applicant’s release from any state or federal correctional institution.

     (h) The following criminal records may shall not be used in connection with any

application for a license or registration submitted pursuant to the provisions of this chapter:

     (1) Juvenile adjudications;

     (2) Records of arrest not followed by a conviction;

     (3) Convictions that have been, pursuant to law, annulled or expunged;

     (4) Misdemeanor convictions for which no jail sentence can be imposed; or

     (5) A conviction that does not substantially relate to the occupation for which the license

or registration is sought, as determined by subsection (f) of this section.

     (i) If the commission intends to deny, suspend, or revoke an occupational license, permit,

or registration solely or in part because of the individual’s prior conviction of a crime that is

determined to be substantially related to the occupation for which the license or registration applies,

the commission shall notify the individual in writing of the following prior to the final decision:

     (1) The specific conviction(s) that forms the basis for the potential denial, suspension, or

revocation and the rationale for deeming the conviction substantially related to the occupation or

activity;

     (2) A copy of the conviction history report, if any, on which the commission relies;

     (3) A statement that the applicant may provide evidence of mitigation or rehabilitation, as

described in subsection (g) of this section; and

     (4) Instructions on how to respond to the potential denial, suspension, or revocation.

     (j) After receiving the notice of potential denial, suspension, or revocation, the individual

shall have thirty (30) business days to respond.

     (k) If the commission denies, suspends, or revokes a license or registration solely or in part

because of the applicant’s substantially related conviction, the commission shall issue a final

written decision that addresses the following:

     (1) The specific conviction(s) that form the basis for the denial, suspension, or revocation

and the rationale for deeming the conviction(s) substantially related to the occupation or activity;

     (2) A copy of the conviction history report, if any, on which the commission relies;

     (3) The process for appealing the decision in accordance with chapter 35 of title 42; and

     (4) The earliest date the person may reapply for license or registration which shall not be

longer than two (2) years from the date of the final decision.

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

in this chapter, any prior conviction for a crime that has been decriminalized, or is eligible for

expungement pursuant to the provisions of this chapter cannot serve as grounds, either solely or in

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part, for denial, suspension or revocation of a license or registration pursuant to this chapter.

     (m) The commission shall adopt rules and regulations establishing standards and

procedures consistent with the provisions of this section.

     21-28.11-31. Social equity assistance program and fund.

     (a)(1) Findings. The general assembly finds that additional efforts are needed to reduce

barriers to ownership and/or participation in the cannabis industry for individuals and communities

most adversely impacted by the enforcement of cannabis-related laws.

     (2) In the interest of establishing a legal cannabis industry that is equitable and accessible

to those most adversely impacted by the enforcement of cannabis-related laws, the general

assembly finds and declares that a social equity program should be established.

     (3) The general assembly also finds and declares that individuals who have been arrested

or incarcerated due to cannabis related laws suffer long-lasting negative consequences, including

impacts to employment, business ownership, housing, health, and long-term financial well-being.

     (4) The general assembly also finds and declares that family members, especially children,

and communities of those who have been arrested or incarcerated due to cannabis related laws,

suffer from emotional, psychological, and financial harms as a result of such arrests or

incarcerations.

     (5) Furthermore, the general assembly finds and declares that certain communities have

disproportionately suffered the harms of enforcement of cannabis-related laws. Those communities

face greater difficulties accessing capital to finance the start-up costs for cannabis establishments.

     (6) The general assembly also finds that individuals who have resided in areas of high

poverty suffer negative consequences, including barriers to entry in employment, business

ownership, housing, health, and long-term financial well-being.

     (7) The general assembly also finds and declares that promotion of business ownership by

individuals who have resided in areas of high poverty and high enforcement of cannabis-related

laws furthers a more equitable cannabis industry.

     (8) Therefore, in the interest of mitigating the harms resulting from the enforcement of

cannabis-related laws, the general assembly finds and declares that a social equity program should

offer, among other things, business assistance and license application benefits to individuals most

directly and adversely impacted by the enforcement of cannabis-related laws who are interested in

establishing or participating in a cannabis business entity.

     (b) There is created in the state treasury within the general fund, a fund which shall be held

separate and apart from all other state monies, to be known as the social equity assistance fund.

The social equity assistance fund, subject to appropriation, shall be exclusively used for the

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following purposes A dedicated social equity assistance fund shall be established within the general

fund, separate and apart from other state monies subject to appropriation. This fund shall be used

for the following purposes:

     (1) To provide grants to approved social equity applicants to pay for ordinary and necessary

expenses to establish and/or operate a cannabis establishment, and to also further promote the goals

of this chapter, including without limitation, job training and workforce development, mentoring

services and technical assistance;

     (2) To support the waiver or reduction of application and licensing fees pursuant to this

section for social equity applicants; and

     (3) To implement and administer programming for restorative justice, jail diversion, drug

rehabilitation and education workforce development for jobs related to cannabis cultivation,

transportation, distribution and sales.

     (c) The social equity assistance fund shall be subject to appropriation. The fund shall

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, exclusive of licensing fees paid

pursuant to the provisions of chapter 28.6 of this title. Additionally, except as otherwise provided,

the fund shall consist of all administrative civil penalties received for violations of this chapter,

except tax violations and interest earned on balances in the fund. Therefore, in the interest of

mitigating the harms resulting from the enforcement of cannabis-related laws, the general assembly

finds and declares that some revenue from the cannabis industry should be returned to

disproportionately impacted areas. A dedicated disproportionately impacted areas invested fund

shall be established within the general fund, separate and apart from other state monies subject to

appropriation. This fund shall be used for the following purposes:

     (1) To provide funding for the development of public housing in disproportionately

impacted areas;

     (2) To provide funding for early and public education in disproportionately impacted areas;

     (3) To provide funding for health subsidies in disproportionately impacted areas; and

     (4) To provide grants and whatever else is deemed necessary to repair the emotional,

psychological, and financial harms the general assembly concluded were perpetuated in.

     (d) The commission shall administer the social equity assistance fund and the authorized

disbursement of funds, as appropriated by the general assembly. In consultation with the cannabis

advisory board, the commission shall promulgate rules and regulations establishing the criteria,

eligibility, qualifications and process for administering the disbursement of funds from the social

equity assistance fund.

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     (e) Reporting. Beginning September 1, 2023, and each year thereafter, the commission

shall annually report to the governor and the general assembly on the outcomes and effectiveness

of this section that shall include, but not be limited to, the following:

     (1) The number of persons or businesses receiving assistance under this section;

     (2) The amount in financial assistance awarded in the aggregate, in addition to the amount

of grants awarded; and

     (3) If applicable, the number of new jobs and other forms of economic impact created as a

result of assistance from the social equity assistance fund.

     (f) Fee waivers.

     (1) For social equity applicants as defined in § 21-28.11-3, the commission may waive up

to one hundred percent (100%) of any nonrefundable license application fees or any nonrefundable

fees associated with acquiring a license to operate a cannabis establishment, pursuant to rules and

regulations promulgated by the commission in consultation with the cannabis advisory board.

     (2) If the commission determines that an applicant who applied as a social equity applicant

is not eligible for social equity status, the applicant shall be provided an additional ten (10) days to

provide alternative evidence that the applicant qualifies as a social equity applicant. Alternatively,

the applicant may pay all required fees and be considered as a non-social equity applicant. If the

applicant cannot do either, then any application fee shall be returned and the application process

shall be terminated.

     (g) Transfers of cannabis establishment licenses awarded to a social equity applicant are

subject to all other provisions of this chapter, and applicable law; provided however, that a license

issued to a social equity applicant shall only be transferred to another qualified social equity

applicant as determined and approved by the commission.

     (h) Reporting.

     (1) By September 1, 2023, and on the first day of September of every year thereafter, or

upon request by the commission, each cannabis establishment licensed under this chapter and § 21-

28.6-12 (“The Edward O. Hawkins and Thomas C. Slater Medical Marijuana Act”) shall report to

the commission, on a form to be provided by the commission, information that will allow it to

assess the extent of diversity in the medical and adult use cannabis industry and methods for further

reducing or eliminating any identified barriers to entry, including without limitation, access to

capital.

     (2) Failure of a cannabis establishment to respond to the request of the commission to

complete the form, report, and any other request for information may be grounds for disciplinary

action by the commission pursuant to this chapter. The information to be collected shall identify,

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without limitation, the following:

     (i) The number and percentage of licenses provided to social equity applicants;

     (ii) The total number and percentage of employees in the cannabis industry who meet the

criteria in the definition of social equity applicant; and

     (iii) Recommendations on reducing or eliminating any identified barriers to entry,

including access to capital, in the cannabis industry.

     SECTION 2. Section 44-70-5 of the General Laws in Chapter 44-70 entitled "Cannabis

Tax" is hereby amended to read as follows:

     44-70-5. Application of tax revenue.

     The administrator shall deposit fifty percent (50%) of the revenue collected pursuant to this

chapter from the state cannabis excise tax or associated amounts as penalties, forfeitures, interest,

costs of suit, and fines for failure to timely report or pay the state cannabis excise tax into the

marijuana trust fund pursuant to § 21-28.11-13(d) and revenue from the sales tax into the general

fund and one hundred percent (100%) of the sales tax into the general fund; twenty-five percent

(25%) of cannabis excise tax revenue into the cannabis social equity assistance fund and twenty-

five percent (25%) of the cannabis excise tax revenue into the disproportionately impacted areas

investment fund.

     SECTION 3. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO FOOD AND DRUGS -- THE RHODE ISLAND CANNABIS ACT

***

     This act would provide amendments to the cannabis act relating to the definition of a social

equity applicant and the required fee to maintain such status as a social equity applicant and would

allocate certain cannabis revenue to the social equity assistance fund and to aid disproportionally

impacted areas.

     This act would take effect upon passage.

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