An Act to Regulate and Tax the Cannabis Industry. in Mass

May 8th, 2010 | by Andrew Miller |

SENATEDOCKET, NO. 2041 FILED ON: 1/16/2009

SENATE . . . . . . . . . .. . . . No. 1801

The Commonwealth ofMassachusetts

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Stanley C. Rosenberg (BY REQUEST)

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To theHonorable Senate and House of Representatives of the Commonwealth ofMassachusetts in General Court assembled:

Theundersigned legislators and/or citizens respectfully petition for the passageof the accompanying bill:

An Act to Regulate and Tax theCannabis Industry.

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The Commonwealth ofMassachusetts

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In the Year Two Thousand and Nine

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An Act to Regulate and Tax the Cannabis Industry.

Beit enacted by the Senate and House of Representatives in General Courtassembled, and by the authority of the same, as follows:

The governor and therepresentatives of the people of Massachusetts, acknowledging that previousefforts have not succeeded in eliminating or curtailing marijuana use andabuse; determined to exercise some measure of control over the use of cannabisconsistent with respect for individual freedom and responsibility; anddeclaring our objectives to be the reduction of cannabis abuse, the eliminationof marijuana-related crime and the raising of public revenue, do hereby ordainand enact The Cannabis Regulation and Taxation Act.

Section 1. This actconsists initially of 45 sections, which together shall be known as TheCannabis Regulation and Taxation Act. It shall be codified as Chapter 13A ofthe general laws

Section 2. Thefollowing conduct is hereby excepted from the provisions of, and shall notconstitute a violation of chapter 94C of the general laws:

a. Possession orcultivation of cannabis by an adult for personal use.

b. Gratuitous distributionof cannabis to an adult. Transfer directly or indirectly related to orcontemporaneous with the sale or tendering for sale of any goods, services orother things of value, shall be deemed not gratuitous.

c. Possession ordistribution of cannabis under a valid license issued in accordance with thisact.

Section 3. This act shall in noway affect existing provisions of law relating to the operation of a motorvehicle under the influence of an intoxicant.

Section 4. . When used in thischapter, the following words shall, unless the context indicates otherwise,have the following meanings:

a. ACT: This chapter of theGeneral Laws of Massachusetts, also known as The Cannabis Regulation andTaxation Act, as amended.

b. ADULT: A person over twenty-oneyears of age.

c. AUTHORITY. The Cannabis ControlAuthority established by section 5.

d. CANNABIS: Any part of the plantCannabis sativa L, or Cannabis indica, or any other variety of the genuscannabis, whether growing or not; the seeds thereof; and resin extracted fromany part of the plant, and every compound, manufacture, salt derivative,mixture or preparation of the plant, its seeds or resin. It does not includethe mature stalks of the plant, fiber produced from the stalks, oil or cakemade from the seeks of the plant, any other compound, manufacture, saltderivative, mixture or preparation of the mature stalks except the resinextracted therefrom., fiber, oil or cake or the sterilized seed of the plantwhich is incapable of germination. Cannabis containing less than 1% THC is notsubject to the provisions of this act.

e. COMMERCIAL: Of or related to anon-gratuitous exchange; with consideration.

f. CULTIVATE: To cause or permitto grow.

g. DOMESTIC: originating from orwithin Massachusetts.

h. CULTIVATION LICENSE: A Licenseissued in accordance with Section 10 of this act.

Ii . FARMER-PROCESSOR-RETAILER: aperson licensed in accordance with section ten10 to cultivate, process and sellcannabis from a single premises.

j. IMPORT: To bring into thecommonwealth or cause to be brought into the commonwealth or to receive fromwithout the commonwealth.

k. LICENSED PREMISES: The groundsand buildings whereon a license possesses cannabis and conducts such businessas licensed to do.

l. LICENSING AUTHORITIES: theauthority or the local licensing authorities or both, as the case may be.

m. LOCAL LICENSING AUTHORITIES:the licensing boards and commissions established in any city or town underspecial statute or charter or, in a city having no such board or commission thealdermen, or, in a town having no such board or commission, the selectmen.

n. NON-GRATUITOUS: Not gratuitous;with consideration; commercial.

o.. PACKAGE: A container in whichcannabis is sold to the purchaser at retail.

p.. PROCESS: To possess cannabisfor the purpose of converting same from intact plants to packaged form, and theact of so converting.

q. PROCESSING LICENSE: A licenseissued in accordance with Section 406(2).

r. PURITY: Freedom from substancesnot indigenous to cannabis, except for water.

s.. RETAIL: Of or pertaining tothe transfer not at wholesale of cannabis for consideration made in theordinary course of trade or usual prosecution of the sellers business to thepurchaser for consumption or use.

t.. SALE: Transfer forconsideration.

u.. THC: Delta-9tetrahydrocannabinol..

CANNABIS CONTROL AUTHORITY

Section 5. . There is herebycreated an authority to be known as the Cannabis Control Authority.

Section 6. The affairs of theauthority shall be managed by a board of seven directors, hereinafter referredto as the directors. A full term thereon shall be seven years. Persons toserve respectively for an initial seven-year term, an initial six-year term,and an initial five-year term, and their replacements, shall be appointed bythe governor, with the approval of the council. Directors for an initialfour-year term and an initial one-year term shall be appointed and vacancies insaid directorships filled by the president of the senate. Directors for aninitial three-year term and an initial two-year term shall be appointed, andvacancies in said directorships filled, by the speaker of the house. Directorsshall receive a salary of 20% of the salary of the governor, and will serve ona part-time basis. The directors shall elect, from among their number, achairman, who shall preside over all official activities of the board ofdirectors. The chairman shall serve for three years or until his term asdirector ends. A chairman may not serve in excess of six consecutive years.No director shall serve more than fourteen years.

Section 7. The concurrence of notfewer than four members of the board of directors shall be required for allofficial actions of the authority. A copy of the minutes of each meeting ofthe board of directors, including any rules and regulations adopted by the authorityor any amendments thereof, shall be forthwith transmitted, by and under thecertification of the secretary thereof, to the governor.

Section 8. . The authority shallhave general supervision of the conduct of the business of cultivating,possessing, distributing, sale at retail and wholesale and importing cannabis,and also of the quality, purity and grade thereof. The authority shall makesuch rules and regulations as it deems necessary to enable it to carry out andenforce the provisions of this act, and shall prescribe the forms ofapplication for licenses under this chapter and may require therein suchinformation as it deems necessary. Every license hereunder shall be governedand controlled by the rules and regulations adopted by the authority. Subjectto the provisions herein, the authority may suspend or revoke any license forany violation of the rules and regulations established hereunder or for aidingor abetting in any violation of such rules and regulations, but before suchsuspension or revocation, the authority shall give a hearing to the licensee,after due notice to him of the charges against him and of the time and place ofthe hearing. Such licensee may appear at the hearing with witnesses and berepresented by counsel. The authority and any representative thereof dulyauthorized to conduct any hearing under this chapter shall have power toadminister oaths and take testimony under oath relative to the matter ofinquiry or investigation. At any hearing ordered by the authority, theauthority or its representative authorized to conduct such hearing may subpoenawitnesses and require the production of books, papers, and documents pertinentto such inquiry. No witness under subpoena authorized to be issued by anyprovision of this chapter shall be excused from testifying or producing booksor papers on the ground that such testimony or the production of such books orother documentary evidence would tend to incriminate him, but such evidence orthe books or papers so produced shall not be used in any criminal proceedingagainst him arising out of any violation of any provision of this act. If anyperson shall disobey such process or, having appeared in obedience thereto,shall refuse to answer any pertinent question put to him by the authority orits authorized agent or to produce any books and papers pursuant thereto, theauthority or such representative may apply to the superior court for the countywherein the person, relative to whose business such hearing is ordered, residesor wherein such business has been conducted, or to any justice of said court ifthe same shall not be in session, setting forth such disobedience to process orrefusal to answer, and said court or justice shall cite such person to appearbefore said court or justice to answer such questions or to produce such booksand papers, and, upon his refusal so to do, may commit him to jail until heshall testify, but not for a longer period than sixty days. Notwithstandingthe serving of the term of such commitment by any person, the authority mayproceed in all respects with such inquiry and examination as if the witness hadnot previously been called upon to testify. Officers who serve subpoenasissued by the authority or under its authority and witnesses attending ahearing conducted by it hereunder shall receive fees and compensation at thesame rates as officers and witnesses before the courts of the commonwealth, tobe paid on vouchers of the authority or to be paid without appropriation out ofthe proceeds of the excise imposed by this chapter, on vouchers approved by theauthority. The rules and regulations adopted by the authority shall be printedas part of the application blank for licenses and for renewal thereof, andevery applicant, as a condition of being licensed hereunder, shall submit tosuch examinations as the authority may deem necessary to establish hisknowledge and understanding of The Cannabis Regulation and Taxation Act.

Section 9. The authority shallimpose and collect an excise upon sales at retail of cannabis. The rate ofsaid excise is hereby established as follows:

Class C Onehundred fifty dollar per ounce

Class B Twohundred dollars per ounce.

Class A Twohundred fifty dollars per ounce.

Subject to approval by the generalcourt, such excise shall be adjusted by the authority from time to time asnecessary to maximize the revenue derived therefrom, and to minimize theincentive for the sale of cannabis not in accordance with the provisions ofthis act…

Section 10. The authority shall,consistent with the objectives set forth in the preamble to this act, issue thefollowing licenses to such applicants as may qualify under this act and therules and regulations of the authority: cultivation licenses, processinglicenses, trade licenses, retail licenses, import licenses, research licensesand farmer-processor-retailer licenses. Provided, however, no such licenseshall be issued until the applicant therefor demonstrates to the satisfactionof the authority that he is twenty-one or more years of age, is familiar withall laws and regulations relating to cannabis, and will exercise said licensein premises adequately secure and otherwise suitable.

a. The holder of a cultivationlicense may possess, propagate, grow and cultivate cannabis and carry on suchother horticultural activities as are reasonably required for the commercialcultivation of cannabis. He may sell cannabis only to the holder of aprocessing license, his agent or employee, but to no other person. He shallfile regular reports as may be required by the authority, and shall be subjectto all reasonable times to inspection by the authority or its representatives.A cultivation license shall be exercisable in one place only. The annual feefor a cultivation license shall be $500.

b.. The holder of a processinglicense, his agents and employees, may obtain cannabis only from the holder ofa cultivation or import license. He may possess, process, package, box andcrate cannabis, and may transfer cannabis only to the holder of a tradelicense, his agent or employees. Processing, packaging, boxing and crating ofcannabis shall be conducted in only one place. Cannabis shall be packaged inquantities only of not less than one, nor more than five ouncesone ounce, bydry weight, in bulk only, and shall not be rolled into cigarette form. Theprocessor shall cause a label to be placed on each package bearing thefollowing information:

(1) The name and place of businessof the processor;

(2) The cannabis grade;

(3) The following statement: TheOperation of a Motor Vehicle under the influence of cannabis, alcohol or anyother intoxicant is a crime punishable of a fine of up to $1,000 orimprisonment up to two years, or both, and may result in the loss of yourlicense to drive.

c. The processor shall affix uponeach cannabis package a tax stamp or such other documentation as the authoritymay require, and shall transfer neither title nor possession of same to anyperson without the said stamps affixed. Said stamps shall be of such designand in such denomination as the authority may prescribe, and shall be the meansby which the excise imposed by section 405 hereunder shall be paid to theauthority. The authority, in its discretion, may authorize the use of ametering machine approved by it in lieu of stamps in order to press or attachto each package of cannabis evidence of the payment of said excise. Suchmachine shall be sealed by its authorized representative and shall be used inaccordance with such rules and regulations as the authority may prescribe. Theauthority may for cause at any time suspend or revoke the authority to use sucha metering machine.

d. The authority shall redeem anyunused or mutilated but identifiable stamps or unused amounts for which a meteris set that any license processor may present for redemption; provided, theywere originally lawfully purchased by the processor who presents them forredemption. Such redemption shall be made at the face value thereof. Theauthority may prescribe necessary rules and regulations for redemptions underthis section. If the authority is satisfied that a processor is entitled to aredemption he shall issue to him stamps of equivalent value to cover themutilated stamps or he may order a refund equal to the actual amount paid forsaid unused or mutilated stamps for the unused amounts for which the meter wasset.

e. All processors shall file underthe penalties of perjury with the authority, on forms to be furnished by it,monthly reports on or before the 20th day of each calendar month showing thenumber of stamps on hand at the beginning of the month, the number purchasedduring the month, the number on hand at the end of the month, the numberaffixed or otherwise disposed of during the month, and such other informationas the authority shall require. All processors shall keep complete andaccurate records from which information can be obtained to complete and auditsaid report, and such other records as the authority may prescribe, shallpreserve such records for three years and shall offer them for inspection atany time upon oral or written demand of the authority or its duly authorizedagents. The stocks of unused stamps in any metering machines shall be open toinspection by the authority or its duly authorized agents at all reasonabletimes.

f. The holder of a processinglicense, his agents and employees, may possess, process, package, box and cratecannabis seeds and may transfer such seeds as are capable of germination to theholder of a cultivation license if said seed is capable of producing cannabispreparations having a THC content of more than 1.5% by mass. The annual feefor a processing license shall be $1,000.

g. All cannabis sold by processorsshall be analyzed and graded as follows:

(1) If said cannabis contains morethan 1% THC and less than 5% THC, then said cannabis shall be labeled C.

(2) If the cannabis contains 5% ormore than 5% and less than 10% THC, then said cannabis shall be labeled B.

(3) If the cannabis contains 10%THC or more, then said cannabis shall be labeled A.

h The aforesaid percentages shallbe established by comparing THC content to dry weight, without seeds.

i. The holder of a trade license,his agents and employees, may obtain cannabis only from a duly licensed processoror importer, and may possess cannabis only bearing valid documentation requiredto be affixed to all packages under the provision of paragraph 2(b) above. Hemay keep, store, warehouse, and transport same, and may sell cannabis only toduly licensed retailer. The annual fee for a trade license shall be $3,000.

j. . The holder of a retaillicense may sell cannabis only to adult members of the public, not visiblyintoxicated or otherwise in such condition as may present a threat to publicsafety.

k. . All sales of cannabis to thepublic must take place within the licensed premises of the retailer, whichpremises must be enclosed.

l. . A retail license shall beexercisable only at the location specified in the license.

m. All cannabis sold by a licensedretailer must bear all appropriate labels and documentation required by thisact and prescribed by the authority.

n.. Cannabis shall not be sold ordistributed to any person under twenty-one years of age.

o. Possession of packagedcannabis for sale at retail not bearing valid documentation as prescribedhereunder shall be a violation of Chapter 94C, Section 34, of the GeneralLaws. It shall be no defense to a claim of violation of this paragraph thatthe retailer in good faith believed documentation borne by cannabis in hispossession to be valid. The annual fee for a retail license shall be $2,000.

p. The holder of an import licensemay possess cannabis and shall distribute same only to the holder of aprocessing license. All imported cannabis is subject to the same requirementsof this act relating to labeling and grading as domestic cannabis.

q. The annual fee for an importlicense shall be $2,500.

r. The authority may issueresearch licenses for a bona fide conduct of medical, social, behavioral orother research, upon such conditions and terms as the authority may prescribeconsistent with the objectives of this act.

s. The holder of afarmer-processor-retailer license may cultivate, process and retail cannabissubject to the same requirements of this act relating to labeling, grading andtaxation of a processor license, provided all cannabis processed and sold isgrown on the licensed premises.

t. The annual fee for afarmer-processor-retailer license shall be $2,500.

tu. Farmer-processor-retailerlicenses may only be issued to an applicant after approval by the locallicensing authorities by such standards as said local licensing authoritiesshall reasonably determine shall protect the public health and safety..

Section 11. No license shall beissued to any person who during the preceding ten years has been convicted of afelony except a felony under Section 94C involving cannabis.

Section 12. Only a cultivationlicense, processing license or import license shall authorize the offering forsale, selling, possessing with intent to sell, or making of a non-gratuitoustransfer or other non-gratuitous disposition of cannabis within thecommonwealth, unless said cannabis be in individual packages bearing suchstamps or documentation as required by law and regulation. If any stamp orother documentation appearing on any package of cannabis be stained or smudgedor its characteristics be so blurred, obscured or indistinct that it cannot bedistinguished as genuine, it shall be invalid. The offering for sale, selling,possessing with intent to sell, or otherwise disposing of or making anon-gratuitous transfer of cannabis within the commonwealth, without a validlicense hereunder shall be punnishablepunishable under Chapter 94C, Section 32of the General Laws.

Section 13. Each license issuedhereunder shall expire in two years from the date of issue by the authority,unless sooner revoked by the authority as provided hereunder, or unless thebusiness with respect to which such license was issued shall change ownership,or unless the holder of the license shall remove his business from the premisescovered by the license, the authority not having given written approval for thetransfer of said license to another person in accordance with the provisions ofsection 413, in any of which cases the license shall thereupon expire. In theevent that a licensee removes his business to another location within his cityor town, the license with respect to the former place of business shall,without the payment of an additional fee, be reissued for the new location forthe balance of the unexpired term. The holder of each license, on applicationto the authority, accompanied by the applicable fee prescribed in section two,may, before the expiration date of the license then held by him, renew hislicense for a further period of two years. In case of suspension, revocationor cancellation of a license issued by the authority, no abatement or refund ofany part of the fee paid therefor shall be made.

Section 14. Stamps anddocumentation hereunder may be issued by the authority to processors on acredit basis, provided the processor shall have furnished a surety company bondwith a surety company authorized to do business in the commonwealth as surety,in such amount as the authority may fix. In lieu of a surety company bond alicensee may deposit with the authority bonds or other negotiable obligationsof the commonwealth or of the United States of America of such aggregate faceamount as the authority may from time to time deem necessary adequately tosecure payment of the excise provided by this chapter; provided, that bondsneed not be accepted by the authority unless in registered form and ofdenominations satisfactory to it. In case of a deposit of bonds or othernegotiable obligations with the authority hereunder, it shall, while inpossession of such bonds, remit to such licensee as aforesaid, or personsentitled thereto, the interest accruing and payable thereon, and if suchexcises together with all interest and other charges accrued thereon shall bepaid in full and if the person is no longer a licensee hereunder, it shallreturn such bonds or obligations to the persons entitled thereto. If theexcise together with all interest and other charges accrued thereon provided bythis chapter shall not be paid in accordance with this chapter, the authoritymay sell all or any part of such bonds or obligations to satisfy the amount duethe authority as aforesaid and shall return to the persons entitled thereto anyexcess left in its hands, provided, however, the person is no longer a licenseehereunder.

Section 15. a.. Whoever falselyor fraudulently makes, forges, alters or counterfeits, or causes or procures tobe falsely or fraudulently made, forged, altered or counterfeited, any excisestamps or other documentation prepared or prescribed by the authority underthis chapter, or whoever knowingly and willfully utters, publishes, passes ortenders as true, any such false, altered, forged or counterfeited stamp ormakes a false affixation of or uses any stamp provided for by this chapterwhich has already once been used, for the purposes of evading the exciseimposed by this chapter, shall be punished by a fine of not more than $2,000 orby imprisonment for not more than five years, or both.

b.. If any person secures,manufactures or causes to be secured or manufactured, or has in his possession,any cannabis excise stamp or die or device not prescribed or authorized by theauthority, or any counterfeit impression, such fact shall be prima facieevidence that such person has counterfeited cannabis excise stamps. Whoeverwilfully removes or alters or knowingly permits to be removed or altered thecancellation or defacing mark of any stamp provided for by this chapter withintent to use such stamp, or knowingly or wilfully buys, prepares for use,uses, has in possession, or suffers to be used, any metering machine withoutauthority, or any washed, restored or counterfeit stamps, or whoeverintentionally removes or causes to be removed, or knowingly permits to beremoved any stamp or meter impression affixed pursuant to this chapter, orwhoever tampers with or causes to be tampered with any metering machineauthorized to be used under the provisions thereof, shall be punished by a fineof not more than $2,000 or by imprisonment for not more than five years, orboth.

Section 16. Sale or distributionof cannabis by vending machine or similar automation is prohibited.

Section 17. Any license issuedunder this chapter may, upon application to the authority upon such forms andin accordance with such procedures as the authority may prescribe, betransferred from one location to another or the description of the licensedpremises may be changed with the approval of the authority. Any license underthis chapter held by an individual, partnership or corporation may betransferred to any individual, partnership or corporation qualified to receivesuch a license in the first instance, if, in the opinion of the authority, suchtransfer is in the public interest.

Section 18. The license of anylicensee who, directly or through any agent, employee or other person, changesin any manner cannabis in his possession by adding a dilutant, attenuant,intoxicant, preservative or any additive of any kind, the effect whereof is toreduce the purity of cannabis to less than 100%, shall be suspended by theauthority for a period of not less than six months, and the licensee shall besubject to such additional sanction as the authority may prescribe. Presenceon the licensed premises of cannabis less than 100% pure shall be prima facieevidence of a violation of this section.

Section 19. Whoever places orcauses to be placed any additive in cannabis shall be liable to any personinjured by reason of ingestion thereof to the extent of three times actualdamages, plus damages for paid and suffering, costs and reasonable attorneysfees.

Section 20. Any person aggrievedby the conduct of any license holder hereunder, his agents or employees, shallstate his grievance in writing to the local licensing commission of the city orthe selectmen of the town wherein the complained of conduct occurred. Afterinvestigation and hearing said commission or selectmen shall, if the publicinterest so requires, within seventy-five days from the date of the firstregular meeting following the receipt of said complaint, submit to theauthority a certified copy of the original complaint, together with a report ofthe commissions or the selectmens findings and recommendation, whichrecommendations shall include, but not be limited to, one of the following:

a.. That no action be takenagainst the license whose conduct is complained of.

b.. That the licensees license besuspended for a specified period of time, not less than one week nor more thanone year.

c. That the licenseeslicense be revoked.

d. The authority shall, withinthirty days of receipt of such findings and recommendations, implement the saidrecommendations unless the licensee complained of shall, during said thirty-dayperiod: have requested a hearing or the authority shall have deemed a hearingto be in the interest of fairness. In either said event, the authority shall,within sixty days, hold a hearing de novo, and thereupon accept, reject orreverse the recommendation of the license commission. No revision shall exceedthe limits set forth in this section for recommendations of the licensecommission. All hearings shall be conducted in accordance with theMassachusetts Administrative Procedure Act, and the licensee shall have theright of appeal as prescribed therein. The authority may suspend or revoke anylicense issued under this act for failure of the licensee to comply with anyprovision hereof, or if the licensee has ceased to act in the capacity forwhich other license was issued, or for other good cause; and no person whoselicense has been suspended or revoked shall sell cannabis or cause or permitcannabis to be sold during the period fo such suspension or revocation.

Section 21. Except as specificallyprovided in this act, all costs and expenses of the authority, includingsalaries and rent, shall be borne by the authority from revenues collected.

Section 22. The number of retaillicenses exercisable within any city or town shall not exceed the total numberof alcoholic beverage licenses which may be issued in said city or town underthe provisions of Chapter 138 of the General Laws, regardless of the number ofalcoholic beverage licenses actually issued. For purposes of this section,alcoholic beverage licenses shall mean the aggregate number of licenses whichauthorizes the sale of alcoholic beverages to consumers, whether package,tavern or victualler.

Section 23. Licensees hereundershall not sell, borrow, loan or exchange unstamped cannabis or stamps to, fromor with other such licensees unless authorized by the authority. Licenseesother than processors shall not accept deliveries of unstamped or improperlystamped packages of cannabis except as authorized by the authority. Everylicensed retailer and trade licensee shall immediately examine all packages ofcannabis received by them and shall immediately return to their supplier anyand all packages of cannabis that are unstamped or improperly stamped. Suchsupplier shall replace them with packages of cannabis upon which stamps havebeen properly affixed.

Section 24. No holder of a licenseof any class shall have, directly or indirectly, present or future, an interestin any other license of the same class or of any other class.

Section 25. Every licensee shallkeep such records in such detail and affording such information as theauthority may from time to time prescribe, and shall file with the authority,whenever and as often as it may require, duplicates of copies of such records;and the authority shall at all times, through its designated officers andagents, have access to all books, records and other documents of any licenseerelating to the business which he is licensed hereunder to conduct.

Section 26. Every licensee shall,on or before the twentieth day of each calendar month, file with the authority,on a form prescribed by it, a report under the penalties of perjury, statingthe amount of cannabis sold by such licensee in the commonwealth during thepreceeding calendar month and such report shall contain or be accompanied bysuch further information as the authority shall require; provided, that if alicensee ceases to sell cannabis within the commonwealth he shall forthwithfile with the authority such a report for th period ending with suchcessation. Each import licensee shall, upon importation of cannabis into thecommonwealth, file with the authority a report, stating the amount of cannabisimported and such other information as the authority shall require

Section 27. The surviving spouseor legal representative of a deceased non-corporate licensee may continue toexercise the license for thirty days following the death of the licensee, butthereafter only with the written consent of the authority, which consent shallexpire, if not sooner revoked, fifteen months from the date of death. Consentshall be withheld unless the said surviving spouse or legal representativemeets the qualifications prescribed by section 406 for the type of licensesought to be retained.

Section 28. No holder of acannabis license hereunder shall have any property right in any document orpaper evidencing the granting of such license issued by the authority, and saidauthority, upon the expiration, suspension, revocation, cancellation, orforfeiture of such a license shall be entitled upon demand to the immediatepossession thereof. The superior court shall have jurisdiction in equity, onpetition of the licensing authorities, to enforce this provision.

Section 29. Every license issuedunder the provisions of this act or a duplicate copy thereof shall beprominently displayed on the premises covered by the license.

Section 30. All records of theauthority are public within the meaning of the General Laws, Chapter 66.

Section 31. The authority shallannually, not later than the fourth Wednesday of April, file a written reportwith the governor and the respective clerks of the senate and house ofrepresentatives which shall contain a comprehensive reporting, accounting,description and analysis of its activities.

Section 32. The state auditorshall conduct an annual post-audit of all accounts and transactions of theauthority, reasonable costs thereof to be borne by the authority.

Section 33. The authority shallreport immediately to the governor and the general court any matters whichrequire immediate changes in the laws of the commonwealth in order to preventabuses and evasions of this act or the rules and regulations promulgated thereunderor to rectify undesirable conditions in connection with the administration ofthis act.

Section 34. The authority shallcarry on a continuous study and investigation of cannabis commerce in thecommonwealth in order (1) to ascertain any defects in this act or in theadministration thereof or any evasion of said law or said rules and regulationsas may arise or be practiced, and (2) to formulate recommendations for changesin said law and the rules and regulations promulgated thereunder to prevent suchabuses and evasions, and (3) to guard against the use of said law andregulations issued thereunder as a cover for the carrying on of criminalactivities.

Section 35. The authority, itsagents and employees, may, during reasonable business hours and without noticethereof, conduct such inspections of the licensed premises; including thebooks, records and accounts of the licensee, as it shall deem appropriate forthe enforcement of this act.

Section 36. The authority shallmake a continuous study and investigation of the operation and administrationof similar laws in other states and countries, of studies on the subject whichfrom time to time may be published or available, of any federal laws which mayaffect the administration of this act, and of the reaction of citizens of thecommonwealth to existing and potential features of the act with a view torecommending and effecting changes that will tend to better serve and implementthe purpose of this act as set forth in the preamble.

Section 37. All fees, taxes,excises and other monies collected in accordance with this act shall beexpended only for the following purposes, and in the following order.

a. . To the Cannabis ControlAuthority for the reasonable cost of carrying out its responsibilities underthis Act;

b. . The balance of said fund shallbe distributed to the general fund of the commonwealth.

Section 38. a. No holder of alicense of any class shall, directly or indirectly, personally or through anyagent or employee, whether for consideration or gratuitously, cause to bepublished in a newspaper or magazine distributed anywhere in the commonwealthor to be broadcast to a radio or television receiver in the commonwealth, or toappeal in any display signs or personal solicitation, or any manner ofadvertising, any advertisement or notice to promote or encourage theconsumption or use in any way of cannabis.

b. The preceding shall not applyto the following:

(1). Cannabis packages, crates,cartons, or boxes of Cannabis packages, provided, however, that no such itemsshall be used for any display, ornament, or fixture on the licensed premises.

(2). Logos contained in privatecorrespondence or publications not intended for public distribution.

(3). A single notice readingAuthorized Cannabis Outlet , in a style to be prescribed by the authority.

Section 39. The sale of cannabisin accordance with this action shall not be subject to the provisions of:

a. Chapter 64H of the GeneralLaws, relating to a sales tax on sales of tangible personal property at retail;or

b. The provisions of Chapter 64Iof the General Laws, relating to a tax on the storage, use or other consumptionof certain tangible property; or

c. The provisions of Chapter 94 ofthe General Laws relating to the inspection and sale of food, drugs, andvarious articles.

Section 40. The use of any deviceor game of chance to aid, promote or induce sales or purchases of cannabis orany goods or services is prohibited. The giving of cannabis in connection withany device or game of chance is prohibited.

Section 41. Any contract, expressor implied, made by any person, firm or corporation in violation of any of theprovisions herein is declared to be an illegal and void contract and norecovery thereon shall be had.

Section 42. All excises paid inpursuance of this act shall conclusively be presumed to be a direct tax on theretail consumer, pre-collected for the purpose of convenience and facilityonly.

Section 43. If any provisions orprovisions of this chapter is or are declared unconstitutional or inoperativeby a final judgment, order or decree of the supreme court of the United Statesor of the supreme judicial court of the commonwealth, the remaining parts ofsaid chapter shall not be affected thereby.

Section 44. Any of the masculinepronouns or nouns herein shall be construed to include or refer to the feminineor neuter gender as well as the masculine.

Section 45. The sum of$2,500,000.00 shall be appropriated to fund the authority initially, which sumshall be repaid by the authority to the treasurer of the commonwealth withinfive years from the day that the first cannabis sale is made under theprovisions of this act, together with interest at the rate of 15% per annumfrom said day.

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