05/08/2024 03:15 PM House LABOR & COMMERCE

             SB 234-EXTEND MARIJUANA CONTROL BOARD                                                                          
                                                                                                                                
4:15:47 PM                                                                                                                    
                                                                                                                                
CHAIR SUMNER announced  that the next order of  business would be                                                               
SENATE BILL  NO. 234, "An  Act relating to the  Marijuana Control                                                               
Board; and providing for an effective date."                                                                                    
                                                                                                                                
4:16:04 PM                                                                                                                    
                                                                                                                                
SENATOR BJORKMAN,  as prime sponsor,  read the  sponsor statement                                                               
for  SB 234  [included in  the committee  packet], which  read as                                                               
follows [original punctuation provided]:                                                                                        
                                                                                                                                
     Senate Bill 234  proposes to extend the  sunset date of                                                                    
     the Marijuana Control Board (MCB) by three years.                                                                          
                                                                                                                                
     In October  of 2023, our Division  of Legislative Audit                                                                    
     completed a sunset  audit of the Board.  In this audit,                                                                    
     it was determined that overall,  the Board has operated                                                                    
     in the public's interest  by conducting its meetings in                                                                    
     accordance  with   state  law,  as  well   as  actively                                                                    
     amending regulations and  conducting investigation in a                                                                    
     timely manner.                                                                                                             
                                                                                                                                
     As you make an in-depth  review the audit, you will see                                                                    
     our auditor made  note of three issues  which should be                                                                    
     addressed by the Board and  the Legislature as it moves                                                                    
     forward.  First,   AMCO's  director   should  establish                                                                    
     procedures  to ensure  handler permit  documentation is                                                                    
     properly  maintained.  Secondly,  the  MCB  and  AMCO's                                                                    
     director  should continue  to implement  a new  license                                                                    
     and  enforcement   information  system.   Thirdly,  the                                                                    
     legislature   should   consider  requiring   regulation                                                                    
     changes  be  approved  by  the   majority  of  the  MCB                                                                    
     members.                                                                                                                   
                                                                                                                                
     Currently, the Board  will sunset on June  30, 2024. To                                                                    
     allow  the  Board to  continue  working  in the  public                                                                    
     interest,  SB 234  follows  the recommended  three-year                                                                    
     extension to June 30, 2027.  A three-year extension was                                                                    
     made in recognition that there  may soon be significant                                                                    
     changes to  the MCB  and to AMCO  duties. Additionally,                                                                    
     this would  align the next  MCB audit with that  of the                                                                    
     Alcoholic Beverage Control Board's next audit.                                                                             
                                                                                                                                
     I urge your support of this legislation.                                                                                   
                                                                                                                                
4:17:59 PM                                                                                                                    
                                                                                                                                
JOAN  WILSON, Director,  Alcohol  and  Marijuana Control  Office,                                                               
began her  testimony by relating  the numbers of  cultivators and                                                               
businesses  in Alaska  and that  without the  control board,  she                                                               
opined the  industry would cease  to exist.   She said  the board                                                               
would be addressing its license  fees, because the industry would                                                               
have  retained the  money borrowed  from the  general fund.   She                                                               
noted that there is an advantage  of aligning the sunset with the                                                               
Alcohol Beverage Control  Board (ABC).  She  explained that there                                                               
would still be a need to  regulate marijuana on a statewide basis                                                               
even with  the changes in  regulations.  She emphasized  that the                                                               
Alcohol  &  Marijuana  Control Office  (AMCO)  is  a  tight-knit,                                                               
hardworking office and it was a privilege to serve Alaska.                                                                      
                                                                                                                                
4:20:43 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SADDLER spoke  to the audit and  asked whether the                                                               
board had a role in enforcing collection of taxes.                                                                              
                                                                                                                                
MS. WILSON  replied no,  but that  the board  had the  ability to                                                               
revoke  licenses.   She  noted there  are  currently 300  defunct                                                               
licenses and the board is working hard to collect the money.                                                                    
                                                                                                                                
4:22:08 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CARRICK  asked how  many vacant staff  for license                                                               
processing  are at  AMCO.   She further  inquired about  how many                                                               
overall staff there were.                                                                                                       
                                                                                                                                
MS. WILSON  replied that AMCO  is recruiting for  three licensing                                                               
examiners and  one administrative assistant.   She added  that it                                                               
was  due to  the Title  4 rewrite.   In  response to  a follow-up                                                               
question, she replied that there are 24 positions at AMCO.                                                                      
                                                                                                                                
REPRESENTATIVE  CARRICK said  the  audit  related that  licensing                                                               
delays  served as  a  barrier  to the  marijuana  industry.   She                                                               
commented that if people cannot  enter legally, or in time, there                                                               
is a chance  of them entering the market illegally.   She offered                                                               
her belief that filling the  open positions is something that the                                                               
legislature should make a high priority.                                                                                        
                                                                                                                                
MS. WILSON related  that when she started two years  ago, it took                                                               
eight months  to get to queued  applications.  She said  AMCO re-                                                               
prioritizes as  much as it can  to serve applicants.   She stated                                                               
that the good news is that the queue has improved.                                                                              
                                                                                                                                
4:25:41 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE RUFFRIDGE moved to report  SB 234 out of committee                                                               
with  individual  recommendations  and  the  accompanying  fiscal                                                               
notes.  There being no objection,  SB 234 was reported out of the                                                               
House Labor and Commerce Standing Committee.