Legislature(2023 - 2024)ANCH LIO DENALI Rm
11/16/2023 02:00 PM House LABOR & COMMERCE
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| Audio | Topic |
|---|---|
| Start | |
| HB119 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 119 | TELECONFERENCED | |
| *+ | HB 186 | TELECONFERENCED | |
HB 119-MARIJUANA TAX
2:00:58 PM
CHAIR SUMNER announced that the only order of business would be
HOUSE BILL NO. 119, "An Act relating to marijuana taxes; and
providing for an effective date." [Before the committee,
adopted as a working document on 4/26/23, was the proposed
committee substitute (CS) for HB 119, Version 33-LS0636\B,
Radford, 4/18/23, ("Version B").]
2:01:46 PM
CODY RICE, House Majority Staff, Alaska State Legislature, on
behalf of the bill sponsor, House Rules by request, provided a
recap of CSHB 119, Version B. He addressed the three main
points covered in the previous meeting: cannabis tax revenue
growth has flattened; Version B would generate more revenue than
the expectations for the status quo; and federal legalization
would strongly affect the competitive cannabis market in Alaska.
CHAIR SUMNER announced the committee would entertain amendments.
He noted that Amendment 1 would not be offered.
2:03:55 PM
REPRESENTATIVE CARRICK moved to adopt Amendment 2 to CSHB 119,
Version B, labeled 33-LS0636\B.1, Radford, 5/2/23, which read as
follows:
Page 2, line 14:
Delete "Monthly statement"
Insert "Quarterly statements [MONTHLY STATEMENT]"
Page 2, line 16:
Delete "calendar month"
Insert "quarter [CALENDAR MONTH]"
Page 2, line 20:
Delete "month"
Insert "quarter [MONTH]"
Page 2, line 28:
Delete "monthly"
Insert "quarterly [MONTHLY]"
Page 2, line 30:
Delete "month"
Insert "quarter [MONTH]"
Delete "monthly"
Insert "quarterly [MONTHLY]"
Page 2, line 31:
Delete "month" in both places
Insert "quarter [MONTH]" in both places
2:04:10 PM
REPRESENTATIVE PRAX objected for the purpose of discussion.
2:04:20 PM
REPRESENTATIVE CARRICK stated that the amendment would change
the requirement for cultivators to submit statements from
monthly to quarterly, as this would reduce the burden on
business owners. She stated that currently many cultivators
must travel to Anchorage to submit these monthly statements.
She stated that the amendment was recommended by the Governor's
Advisory Task Force on Recreational Marijuana and by
constituents.
2:05:47 PM
REPRESENTATIVE PRAX expressed agreement with the amendment and
removed his objection.
CHAIR SUMNER requested a roll call vote.
2:06:21 PM
A roll call vote was taken. Representatives Saddler, Prax,
Carrick, Fields, Ruffridge, and Sumner voted in favor of
Amendment 2 to CSHB 119, Version B. Representative Wright voted
against it. Therefore, Amendment 2 was adopted by a vote of 6-
1.
CHAIR SUMNER, at the request of Representative Carrick, rolled
Amendment 3 to the bottom of the list.
2:08:00 PM
REPRESENTATIVE CARRICK moved to adopt Amendment 4 to CSHB 119,
Version B, as amended, labeled 33-LS0636\B.5, Radford, 9/6/23,
which read as follows:
Page 1, line 1, following "Act":
Insert "relating to marijuana cultivation;"
Page 1, following line 2:
Insert a new bill section to read:
"* Section 1. AS 17.38 is amended by adding a new
section to read:
Sec. 17.38.075. Marijuana inventory tracking at
marijuana cultivation facilities. A marijuana
cultivation facility shall assign a tracking number to
each crop of marijuana plants when the height of one
or more plants exceeds eight inches. The board may not
require a marijuana cultivation facility to assign an
individual tracking number to each plant propagated,
grown, or cultivated on the marijuana cultivation
facility's premises."
Page 1, line 3:
Delete "Section 1"
Insert "Sec. 2"
Renumber the following bill sections accordingly.
Page 3, line 13:
Delete "sec. 1"
Insert "sec. 2"
Page 3, line 14:
Delete "sec. 1"
Insert "sec. 2"
Page 3, line 15:
Delete "Sections 3 - 5"
Insert "Sections 4 - 6"
Page 3, line 16:
Delete "sec. 9"
Insert "sec. 10"
2:08:04 PM
REPRESENTATIVE RUFFRIDGE objected for the purpose of discussion.
2:08:11 PM
REPRESENTATIVE CARRICK stated that after touring several
cultivation facilities, it was observed that plant tagging was a
common burden addressed by business owners. Currently
cultivators are required to tag each plant. She expressed the
understanding that it is not necessary, and it causes a
financial and time burden, as some businesses have thousands of
plants. Concerning other agricultural products regulated by the
state, these only require tagging on a per-crop basis. She
stated that the tagging system is only required for public
health reasons in case of a recall. She argued that tagging on
a per-crop basis would cover this, and it would alleviate a
significant cost for cultivators.
2:10:15 PM
REPRESENTATIVE RUFFRIDGE requested that a member from the
Governor's Advisory Task Force on Recreational Marijuana speak
to the amendment.
2:10:51 PM
RYAN TUNSETH, President, Co-Chair, Alaska Marijuana Industry
Association; Governor's Advisory Task Force on Recreational
Marijuana, stated that the Marijuana Control Board had recently
discussed the issue. In this discussion it was learned that the
state's contract with Metric would be an issue concerning this
amendment. He added that Metric is a seed to sell tracking
system. He continued that if the system moves from a single
plant tag to a batch tag, the price of the tag would go from 25
cents a tag to $25 a tag, and to implement this change in the
system it would cost $200,000; however, some cultivators pay
upwards to $10,000 a year for individual plant tags, so the
amendment is supported.
2:12:39 PM
REPRESENTATIVE SADDLER questioned how one tag would be able to
define a crop. In other words, he questioned how "crop" would
be defined.
REPRESENTATIVE CARRICK deferred the question to Legislative
Legal Services. She expressed the understanding that "crop"
does have a standard definition in relation to other
agricultural products in the state, and the amendment was
drafted with this consideration.
REPRESENTATIVE SADDLER stated that to support the amendment he
would need to see the definition.
2:14:06 PM
REPRESENTATIVE PRAX questioned the original rationale for
tagging individual plants.
2:14:41 PM
BRANDON EMMETT, Co-Chair, Governor's Advisory Task Force on
Recreational Marijuana, stated that he was one of the original
members of the Marijuana Control Board. He explained that the
original idea had been in response to the board having an
abundance of caution, and the board wanted to make sure the
industry was well regulated. There had been the idea that
marijuana would be grown in a legal facility but moved to be
sold on the black market. However, the diversion happened the
other way, as illegally grown marijuana entered the legal
market, or it was never part of the legal market. He expressed
the belief that the tagging system is redundant and unnecessary.
2:16:07 PM
REPRESENTATIVE PRAX questioned how a specific crop would be
identified.
MR. EMMET answered that a crop is considered a group of plants
propagated at the same time, grown to similar heights, and
harvested at the same point of maturity. He stated that a
limited grow might have 10 plants in a crop while a standard
grow could have 50 plants. He expressed the understanding that
with a single tag for each crop, enforcement could identify
anyone of the plants in the crop.
2:17:13 PM
REPRESENTATIVE RUFFRIDGE questioned whether Amendment 4 could
bring additional costs or demands to the cultivators.
MR. TUNSETH expressed the understanding that because of the
contract with Metric the cost would increase by $200,000. In
response to a follow-up question, he stated that this cost would
be passed to the cultivators.
2:19:05 PM
REPRESENTATIVE PRAX expressed the opinion that the only way the
state could recover costs would be through tax. He opined that
the state could bill the growers for the additional costs for
the tags.
2:19:41 PM
REPRESENTATIVE CARRICK expressed the opinion that the current
tagging system is redundant and unnecessary. She acknowledged
the cost of the contract with Metric; however, she argued there
should also be an understanding of what is useful, necessary,
and efficient concerning oversite of the industry.
CHAIR SUMNER recognized that the objection by Representative
Ruffridge was maintained.
2:21:02 PM
A roll call vote was taken. Representatives Fields, Prax, and
Carrick voted in favor of Amendment 4 to CSHB 119, Version B, as
amended. Representatives Ruffridge, Saddler, Wright, and Sumner
voted against it. Therefore, Amendment 4 failed by a vote of 3-
4.
2:22:13 PM
REPRESENTATIVE CARRICK moved to adopt Amendment 5 to CSHB 119,
Version B, as amended, labeled 33-LS0636\B.6, Radford, 9/6/23,
which read as follows:
Page 1, line 1, following "Act":
Insert "relating to the lawful operation of
retail marijuana stores;"
Page 1, following line 2:
Insert new bill sections to read:
"* Section 1. AS 17.38.070(a) is amended to read:
(a) Notwithstanding any other provision of law,
the following acts, when performed by a retail
marijuana store with a current, valid registration, or
a person 21 years of age or older who is acting in the
person's capacity as an owner, employee, or agent of a
retail marijuana store, are lawful and are not an
offense under state law or a basis for seizure or
forfeiture of assets under state law:
(1) possessing, displaying, storing, or
transporting marijuana or marijuana products, except
that marijuana and marijuana products may not be
displayed in a manner that is visible to the general
public from a public right-of-way;
(2) delivering or transferring marijuana or
marijuana products to a marijuana testing facility;
(3) receiving marijuana or marijuana
products from a marijuana testing facility;
(4) purchasing marijuana from a marijuana
cultivation facility;
(5) purchasing marijuana or marijuana
products from a marijuana product manufacturing
facility; and
(6) delivering, distributing, or selling
marijuana or marijuana products to a consumer, a
marijuana cultivation facility, or a marijuana product
manufacturing facility [CONSUMERS].
* Sec. 2. AS 17.38.900(18) is amended to read:
(18) "retail marijuana store" means an
entity registered to purchase marijuana from marijuana
cultivation facilities, to purchase marijuana and
marijuana products from marijuana product
manufacturing facilities, and to sell marijuana and
marijuana products to consumers, marijuana cultivation
facilities, and marijuana product manufacturing
facilities;"
Page 1, line 3:
Delete "Section 1"
Insert "Sec. 3"
Renumber the following bill sections accordingly.
Page 3, line 13:
Delete "sec. 1"
Insert "sec. 3"
Page 3, line 14:
Delete "sec. 1"
Insert "sec. 3"
Page 3, line 15:
Delete "Sections 3 - 5"
Insert "Sections 5 - 7"
Page 3, line 16:
Delete "sec. 9"
Insert "sec. 11"
2:22:22 PM
REPRESENTATIVE SADDLER objected.
2:22:32 PM
REPRESENTATIVE CARRICK stated that this amendment is also the
result of touring cultivation facilities, where another common
issue was the ability of stores to sell back products to
manufacturers as an up-stream sale. She stated this amendment
also reflects options other agricultural businesses have in the
state. Currently this is not allowed in the marijuana industry,
and the amendment would add this language so unprofitable
products could be sold back to manufacturers to be made into
different products. She added that this would ensure no
products are wasted or fall into unintended uses.
2:24:33 PM
REPRESENTATIVE SADDLER expressed concern about how value would
be assessed as there would be "swirling" of products sold up and
down the supply chain. He maintained his objection.
REPRESENTATIVE CARRICK commented that the amendment would allow
the industry the same flexibility as other agricultural
industries in the state. It would also allow for all products
to find use and to be sold in Alaska.
2:25:36 PM
A roll call vote was taken. Representatives Prax, Wright,
Carrick, Fields, and Ruffridge voted in favor of Amendment 5 to
CSHB 119, Version B, as amended. Representatives Saddler and
Sumner voted against it. Therefore, Amendment 5 was adopted by
a vote of 5-2.
2:26:31 PM
REPRESENTATIVE CARRICK moved to adopt Amendment 6 to CSHB 119,
Version B, as amended, labeled 33-LS0636\B.7, Radford, 9/6/23,
which read as follows:
Page 2, line 10:
Delete "10"
Insert "four"
CHAIR SUMNER objected.
2:26:50 PM
REPRESENTATIVE CARRICK stated that Amendment 6 would address the
issue of the sales tax rate on the industry. She referenced the
Alaska Marijuana Industry Association's opinion that the
industry is in crisis, and this is partly because of the current
sales tax rate. She stated that the 10 percent rate in Version
B was a "shock" to the association; however, referencing the
task force, this is considered a "happy medium." She stated
that the amendment would change the rate from 10 percent to 4
percent, as this would be a reduction and a compromise. She
expressed the opinion that this would curtail the black market.
2:28:29 PM
CHAIR SUMNER cautioned the committee members to consider the
fiscal impact of the amendment, as this would be a 60 percent
reduction in the tax. He maintained his objection.
2:28:52 PM
A roll call vote was taken. Representatives Carrick and Prax
voted in favor of Amendment 6 to CSHB 119, Version B, as
amended. Representatives Wright, Fields, Ruffridge, Saddler,
and Sumner voted against it. Therefore, Amendment 6 failed by a
vote of 2-5.
2:29:42 PM
REPRESENTATIVE CARRICK moved to adopt Amendment 7 to CSHB 119,
Version B, as amended, labeled 33-LS0636\B.10, Radford, 11/8/23,
which read as follows:
Page 1, line 1, following "taxes;":
Insert "relating to the duties of the Department
of Revenue;"
Page 3, following line 8:
Insert a new bill section to read:
"* Sec. 6. AS 44.25.020 is amended to read:
Sec. 44.25.020. Duties of department. The
Department of Revenue shall
(1) enforce the tax laws of the state;
(2) collect, account for, have custody of,
invest, and manage all state funds and all revenues of
the state except revenues incidental to a program of
licensing and regulation carried on by another state
department, funds managed and invested by the Alaska
Retirement Management Board, and as otherwise provided
by law;
(3) invest and manage the balance of the
power development fund in accordance with
AS 44.83.386;
(4) administer the surety bond program for
licensure as a fish processor or primary fish buyer;
(5) establish at least one facility in each
judicial district to collect monthly statements and
payments from retail marijuana stores under
AS 43.61.020."
Renumber the following bill sections accordingly.
Page 3, line 15:
Delete "Sections 3 - 5"
Insert "Sections 3 - 6"
Page 3, line 16:
Delete "sec. 9"
Insert "sec. 10"
2:29:52 PM
REPRESENTATIVE SADDLER objected.
2:30:03 PM
REPRESENTATIVE CARRICK stated that because of the burden on the
industry, Amendment 7 would require the Department of Revenue
(DOR) to establish a marijuana tax collection facility in each
of the four judicial districts in the state. She stated that
currently there is only a collection facility in Anchorage,
which requires individuals in the industry to travel to pay
their taxes in cash, [which is required by federal law].
Instead of creating a tax collection facility in each
municipality, which would be costly, she suggested that this
would be a compromise.
2:31:38 PM
REPRESENTATIVE SADDLER commented that in light of trying to save
costs for the industry, the amendments seem to be going in the
wrong direction. He maintained his objection.
2:32:13 PM
REPRESENTATIVE RUFFRIDGE, in reference to [the previously
adopted Amendment 2], questioned the effect of this in regard to
quarterly statements. He also questioned whether DOR could
speak to the cost and implementation of the amendment.
REPRESENTATIVE CARRICK expressed the opinion that this is a good
point, as individuals would be required to travel only quarterly
as opposed to monthly and this would alleviate some of the
burden. However, in reference to Amendment 7, there are still
individuals in Fairbanks who have to make a seven-plus hour
drive four times a year to do required business, while most
other businesses in the state do not have this burden.
2:34:14 PM
The committee took an at-ease from 2:34 p.m. to 2:35 p.m.
2:35:39 PM
CHAIR SUMNER informed that a representative from DOR was not
available for comment.
REPRESENTATIVE PRAX expressed support for the amendment and
expressed concern about keeping the marijuana market "above
board." He stated that the obstacle of having to travel with
large amounts of cash, as it is a cash industry because of
federal regulations, poses a substantial risk of robbery. He
suggested that the amendment would help make the legal market
competitive with the black market.
2:37:56 PM
REPRESENTATIVE CARRICK concurred that this would help the legal
marijuana market thrive and have equity with other businesses in
the state. She acknowledged the cost for DOR; however, she
pointed out that commerce should be supported.
CHAIR SUMNER acknowledged that the objection was maintained.
2:38:53 PM
A roll call vote was taken. Representatives Wright, Carrick,
and Prax voted in favor of Amendment 7 to CSHB 119, Version B,
as amended. Representatives Ruffridge, Saddler, and Sumner
voted against it. Therefore, Amendment 7 failed by a vote of 3-
3.
2:39:53 PM
REPRESENTATIVE PRAX [moved to adopt] Amendment 8 to CSHB 119,
Version B, as amended, labeled 33-LS0636\B.8, Radford, 10/8/23,
which read as follows:
Page 1, line 10, through page 2, line 7:
Delete all material.
Renumber the following bill sections accordingly.
Page 3, line 9:
Delete "AS 43.61.010(b) is"
Insert "AS 43.61.010(b) - (f) and
AS 44.29.020(a)(14) are"
Page 3, line 15:
Delete "Sections 3 - 5"
Insert "Sections 2 - 4"
Page 3, line 16:
Delete "sec. 9"
Insert "sec. 8"
REPRESENTATIVE PRAX explained that Amendment 8 would repeal the
language in statute that establishes the designated fund for
marijuana tax revenue. He explained that this is aligned with
his objection to designated funds. He advised that the
legislature should be reviewing the effectiveness of programs
year to year, and in regard to this legislation this concerns
discouraging use and illicit use of the product by youths.
2:41:47 PM
REPRESENTATIVE CARRICK objected. In regard to the recipients of
the marijuana treatment program fund, such as the Alaska
Children's Trust, she questioned where these funds would come
from if this is passed. She questioned whether this would
delete the programs.
REPRESENTATIVE PRAX expressed the opinion that the amendment
would not delete the programs, it would just not designate funds
for any particular program. He stated that the funds would go
into the general fund and be appropriated from there, and this
could fund the programs if they are effective.
2:43:35 PM
REPRESENTATIVE FIELDS questioned whether the stakeholders who
would be effected commented on the amendment.
CHAIR SUMNER responded that there is no written comment;
however, the Alaska Children's Trust contacted his office and
expressed opposition to the amendment.
2:44:45 PM
REPRESENTATIVE PRAX expressed the intention to not pass judgment
on any program, rather the amendment would move the funds to the
general fund so there could be a discussion of the effectiveness
of the programs.
CHAIR SUMNER noted that the objection was maintained.
2:45:26 PM
A roll call vote was taken. Representatives Ruffridge, Saddler,
Prax, Wright, and Carrick voted in favor of Amendment 8 to CSHB
119, Version B, as amended. Representatives Fields and Sumner
voted against it. Therefore, Amendment 8 was adopted by a vote
of 5-2.
2:46:39 PM
The committee took an at-ease from 2:46 p.m. to 2:47 p.m.
2:47:23 PM
REPRESENTATIVE CARRICK moved to adopt Amendment 10 to CSHB 119,
Version B, as amended, labeled 33-LS0636\B.4, Radford, 9/6/23,
which read as follows:
Page 1, line 1, following "Act":
Insert "relating to the registration of marijuana
establishments;"
Page 1, following line 2:
Insert new bill sections to read:
"* Section 1. AS 17.38.200(a) is amended to read:
(a) Each application or renewal application for
a registration to operate a marijuana establishment
shall be submitted to the board. A renewal application
may be submitted up to 90 days before the expiration
of the marijuana establishment's registration. When
filing an application for a new registration under
this subsection, the applicant shall submit the
applicant's fingerprints and the fees required by the
Department of Public Safety under AS 12.62.160 for
criminal justice information and a national criminal
history record check. When filing an application for
renewal of registration, an applicant shall submit the
applicant's fingerprints and the fees required by the
Department of Public Safety under AS 12.62.160 for
criminal justice information and a national criminal
history record check every six [FIVE] years. The board
shall forward the fingerprints and fees to the
Department of Public Safety to obtain a report of
criminal justice information under AS 12.62 and a
national criminal history record check under
AS 12.62.400.
* Sec. 2. AS 17.38.200(d) is amended to read:
(d) Within 45 to 90 days after receiving an
application or renewal application, the board shall
issue a biennial [AN ANNUAL] registration to the
applicant unless the board finds the applicant is not
in compliance with regulations enacted under [PURSUANT
TO] AS 17.38.190 or the board is notified by the
relevant local government that the applicant is not in
compliance with ordinances and regulations made under
[PURSUANT TO] AS 17.38.210 and in effect at the time
of application.
* Sec. 3. AS 17.38.210(e) is amended to read:
(e) A local government may establish a schedule
of biennial [ANNUAL] operating, registration, and
application fees for marijuana establishments,
provided that the local government may charge the
(1) application fee only if an application
is submitted to the local government in accordance
with (f) of this section; and
(2) registration fee only if a registration
is issued by the local government in accordance with
(f) of this section.
* Sec. 4. AS 17.38.210(f) is amended to read:
(f) If the board does not issue a registration
to an applicant within 90 days after receiving [OF
RECEIPT OF] the application filed in accordance with
AS 17.38.200 and does not notify the applicant of the
specific, permissible reason for its denial, in
writing and within that [SUCH] time period, or if the
board has adopted regulations under [PURSUANT TO]
AS 17.38.190 and has accepted applications under
[PURSUANT TO] AS 17.38.200 but has not issued any
registrations by 15 months after February 24, 2015,
the applicant may resubmit its application directly to
the local regulatory authority, under [PURSUANT TO]
(c) of this section, and the local regulatory
authority may issue a biennial [AN ANNUAL]
registration to the applicant. If an application is
submitted to a local regulatory authority under this
subsection, the board shall forward to the local
regulatory authority the application fee paid by the
applicant to the board upon request by the local
regulatory authority.
* Sec. 5. AS 17.38.210(h) is amended to read:
(h) A local regulatory authority issuing a
registration to an applicant shall do so within 90
days after receiving [OF RECEIPT OF] the submitted or
resubmitted application unless the local regulatory
authority finds and notifies the applicant that the
applicant is not in compliance with ordinances and
regulations made under [PURSUANT TO] (b) of this
section in effect at the time the application is
submitted to the local regulatory authority. The local
government shall notify the board if a biennial [AN
ANNUAL] registration has been issued to the applicant.
* Sec. 6. AS 17.38.210(j) is amended to read:
(j) A subsequent or renewed registration may be
issued under (f) of this section on a biennial [AN
ANNUAL] basis only upon resubmission to the local
government of a new application submitted to the board
under [PURSUANT TO] AS 17.38.200.
* Sec. 7. AS 17.38.320 is amended to read:
Sec. 17.38.320. Effect on registrations of
prohibition of marijuana establishments. If a majority
of voters vote to prohibit the operation of marijuana
establishments under AS 17.38.300, the board may not
issue, renew, or transfer, between persons or
locations, a registration for a marijuana
establishment located within the perimeter of the
established village. A registration that may not be
renewed because of a local option election held under
AS 17.38.300 is void 90 days after the results of the
election are certified. A registration that expires
during the 90 days after the results of a local option
election are certified may be extended, until it is
void under this section, by payment of a prorated
portion of the biennial [ANNUAL] registration fee."
Page 1, line 3:
Delete "Section 1"
Insert "Sec. 8"
Renumber the following bill sections accordingly.
Page 3, line 13:
Delete "sec. 1"
Insert "sec. 8"
Page 3, line 14:
Delete "sec. 1"
Insert "sec. 8"
Page 3, line 15:
Delete "Sections 3 - 5"
Insert "Sections 10 - 12"
Page 3, line 16:
Delete "sec. 9"
Insert "sec. 16"
2:47:27 PM
REPRESENTATIVE SADDLER objected for the purpose of discussion.
He questioned the benefits of lengthening the time between
background checks and lengthening the time between
registrations.
2:47:54 PM
REPRESENTATIVE CARRICK compared Amendment 10 with changing the
statements from monthly to quarterly. She expressed the opinion
that this would reduce the burden on license renewal for
business owners. She continued by comparing this to bar owners
who already have a biannual license renewal, and this would
bring parity to the marijuana industry. She stated that the
amendment would also lengthen the time frame for the
fingerprinting requirement. She added that this was a request
from the governor's task force and the Alaska Marijuana Industry
Association.
REPRESENTATIVE SADDLER commented that the marijuana industry is
new in Alaska, and it is still illegal on the federal level. He
argued that this reality means that certain levels of
regulations are reasonable.
2:50:16 PM
REPRESENTATIVE PRAX expressed support for the amendment. In
touring some marijuana establishments, he observed that the
establishments made conscientious efforts to control the
business concerning minors and scams, while being helpful in
making sure customers were not having "a bad experience." He
provided examples of this. He expressed the confidence that the
industry could go to a biannual cycle, as this would also save
the state time and expense.
REPRESENTATIVE SADDLER maintained his objection.
2:52:28 PM
REPRESENTATIVE CARRICK advised that the voters of the state
chose to make marijuana legal, and this is a young industry with
the potential to continue to thrive. She concurred that the
marijuana industry has professionalism and a quality of
business. She stressed that establishing parity is important by
eliminating burdens, while maintaining appropriate oversite, as
this will keep the industry going.
CHAIR SUMNER noted that the objection was maintained.
2:53:40 PM
A roll call vote was taken. Representatives Ruffridge, Prax,
Carrick, Fields, and Sumner voted in favor of Amendment 10 to
CSHB 119, Version B, as amended. Representatives Saddler and
Wright voted against it. Therefore, Amendment 10 was adopted by
a vote of 5-2.
2:54:35 PM
REPRESENTATIVE CARRICK moved to adopt Amendment 3 to CSHB 119,
Version B, as amended, labeled 33-LS0636\B.2, Radford, 5/2/23,
which read as follows:
Page 2, line 10:
Delete "10"
Insert "six"
2:54:42 PM
REPRESENTATIVE SADDLER objected.
2:54:50 PM
REPRESENTATIVE CARRICK stated that Amendment 3 goes back to the
issue of the sales tax rate, as this would change the rate from
10 percent to 6 percent. She suggested that this would be a
compromise. She stated that having 10 percent in Version B had
"shocked" the industry. She advised that this tax rate would
help address the black market problem and help the legal market.
She advised that a 6 percent tax would help "thread the needle"
between the need for state revenue and continuing the industry.
She stated that this would still be a higher tax burden than
what the industry was looking for initially.
2:56:14 PM
REPRESENTATIVE SADDLER commented that Version B has already
provided for a 75 percent reduction of the excise tax, with some
recovery with a sales tax. He expressed the opinion that this
tax would not be enough. He maintained his objection.
2:56:54 PM
REPRESENTATIVE PRAX expressed support for the amendment. He
agreed with maximizing revenue; however, he pointed out that
municipalities also have taxes, and at some point, high taxes
will affect the market by supporting a black market.
2:58:21 PM
REPRESENTATIVE RUFFRIDGE questioned whether someone could
discuss the different tax rate options of 10 percent, 8 percent,
or 6 percent.
2:59:09 PM
MR. RICE pointed out three of the scenarios he had provided to
the committee during the previous meeting. He advised that
moving to 6 percent would generate more revenue than the status
quo.
2:59:54 PM
REPRESENTATIVE CARRICK stated that this last comment points out
the value of the amendment.
CHAIR SUMNER noted that the objection was maintained.
3:00:04 PM
A roll call vote was taken. Representatives Prax, Carrick,
Ruffridge, and Sumner voted in favor of Amendment 3 to CSHB 119,
Version B, as amended. Representatives Saddler, Fields, and
Wright voted against it. Therefore, Amendment 3 was adopted by
a vote of 4-3.
[CSHB 119, Version B, as amended, was held over.]
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB119 Amendments 1-10.pdf |
HL&C 11/16/2023 2:00:00 PM |
HB 119 |
| Amendment 11.pdf |
HL&C 11/16/2023 2:00:00 PM |
HB 119 HB119 Amendment #11 |
| U.pdf |
HL&C 11/16/2023 2:00:00 PM |
HB 119 |
| Passed/Failed Amendments on HB 119 House L&C.pdf |
HL&C 11/16/2023 2:00:00 PM |
HB 119 |