Scott Goss

The News Journal

Gov. John Carney will meet Wednesday with advocates of a bill that would make Delaware the ninth state to legalize the use and sale of recreational marijuana.

The 39-page bill introduced in the General Assembly last month would allow people 21 and older to purchase up to 1 ounce of cannabis from dozens of stores that would be authorized to sell marijuana manufactured at a number of Delaware grow operations. The measure has been assigned to the House Revenue and Finance Committee where it could have a hearing as early as next week.

The bill comes six years after Delaware legalized medical marijuana and two years after the state decriminalized cannabis, downgrading possession of up to 1 ounce from a criminal offense to a civil violation, like a parking ticket.

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1. The meeting

Carney has voiced his opposition to the recreational marijuana bill but says he is willing to hear from all sides.

The 4 p.m. roundtable discussion with pro-legalization advocates at Delaware Technical Community College's George Campus in Wilmington will be open to the public. Seating is limited to about 50 people and only a few comments from the audience will be allowed.

A similar roundtable with opponents of the bill is not being planned, according to Carney's office.

2. The industry

The law would create a four-tiered system that includes privately run cultivation, testing, manufacturing and retail businesses.

Initially, up to 75 cultivation facilities could be licensed to grow marijuana for retail shops. The cultivators would be required to submit samples of their crops to one of five testing facilities tasked with examining the products' potency while also screening for illegal contaminants, such as toxic fertilizers.

Once approved for sale, the marijuana grown by the cultivators then could be sold to one of 40 retail shops throughout the state. Or it could be sold to one of 25 manufacturing facilities that eventually could be licensed to convert the cannabis into an edible, a liquid, an ointment, tincture or other end product. Those products also would have to be tested before being sold at a retail store.

All four types of operations would be required to pay $10,000 for a two-year license. The cost of applying for a license would be $5,000.

Stores would be limited to selling no more than 1 ounce of marijuana or its equivalent during a single transaction. Just like liquor stores, retail marijuana stores would be barred from operating on Thanksgiving, Easter or Christmas. Operating on Sundays would require a special $500, two-year license.

3. The roll out

Delaware's marijuana industry would not begin on the day the law is passed.

Instead, the first eight or nine months would be dedicated to establishing the bureaucratic system needed to regulate the new industry and the creation of state rules for how that industry operates.

After 11 months, the new marijuana control commissioner would be able to issue licenses to Delaware medical marijuana compassion centers interested in offering retail sales. It could take another two to eight months before the commissioner issues licenses to other retail stores.

4. The bureaucracy

The bill would create a new Marijuana Control and Enforcement Division within the Department of Safety and Homeland Security tasked with regulating the marijuana industry, hearing public complaints, investigating violations and arresting those breaking the law. The division would be headed by a commissioner whose decisions could be challenged before a three-member appeals commission. The number of people employed by the division would be set by DSHS and the General Assembly through the budget process.

A nine-member oversight commission also would be created. The commission would be responsible for preparing an annual report on the new marijuana industry, including the number of licenses issued and amount of cannabis sold. The commission also would be tasked with proposing changes to the law and evaluating the act's impact on public safety and illegal sales.

5. The limitations

Under the proposed Marijuana Control Act, employers still would be allowed to ban marijuana consumption or possession at the workplace, while barring workers from consuming recreational cannabis altogether. Likewise, private property owners, schools, colleges and universities, hospitals and detention facilities would be able to regulate marijuana on their grounds.

Landlords would be forbidden from prohibiting renters from consuming marijuana unless they live on the property or failing to do so would cause them to lose a "monetary or licensing-related benefit" under federal law.

Towns also would be allowed to exclude marijuana cultivators, testing facilities, manufacturing companies and retail stores if such a ban is approved by voters in a referendum included on a general election ballot. Local jurisdictions also would be allowed to enact their own rules and create their own oversight bodies so long as such measures do not conflict with the act.

Sales to anyone under the age of 21 would be expressly forbidden. Stores and consumers caught selling to minors would be charged with a misdemeanor punishable by a fine between $250 and $500. Failure to pay the fine could result in a 30-day jail sentence.

Driving under the influence of marijuana and consuming cannabis in a moving vehicle also would be illegal, along with consuming marijuana in public or growing it without a license.

6. The money

The lead sponsors of the Marijuana Control Act estimate that legalizing recreational marijuana sales could generate up to $22 million in the first full year of operation. That's not going to go a long way toward filling Delaware's structural budget deficit, now estimated at nearly $395 million.

The money generated by the new law would come from licensing fees, civil penalties and excise taxes imposed on the sale or transfer marijuana from cultivators to manufacturers or cultivators to retail stores. Those taxes could charge $50 per ounce on the ingestible portion of the plants, $15 per ounce on other parts of the plant and $25 per immature plant. The businesses also would be required to pay all applicable property, payroll and gross receipts taxes.

Under the proposed act, funds collected by the state first would be used to cover the administrative costs and expenses of the Marijuana Control and Enforcement Division, including payroll and employment costs.

The remainder would be split with 20 percent going to public schools; 10 percent for nonprofits that support job placement, mental health treatment, addiction recovery and community re-entry programs for convicts; 10 percent for the prevention and treatment of alcohol, tobacco and marijuana abuse; and 10 percent for public education campaigns about the health and safety risk of alcohol, tobacco and marijuana.

Contact business reporter Scott Goss at (302) 324-2281, sgoss@delawareonline.com or on Twitter @ScottGossDel.