Amendment SSA1-AB440

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2021 - 2022 LEGISLATURE

SENATE SUBSTITUTE AMENDMENT 1, TO ASSEMBLY BILL 440

January 25, 2022 - Offered by Senators Agard, Roys, Smith, Pfaff, Larson, Johnson, Erpenbach, L. Taylor and Bewley.

AB440-SSA1,2,3 An Act to repeal 94.55 (2t), 961.11 (4g), 961.14 (4) (t), 961.32 (2m), 961.38 (1n), 961.41 (1) (h), 961.41 (1m) (h), 961.41 (1q), 961.41 (3g) (e), 961.571 (1) (a) 7., 961.571 (1) (a) 11. e., 961.571 (1) (a) 11. k. and L. and 967.055 (1m) (b) 5.; to renumber and amend 115.35 (1), 961.01 (14) and 961.34; to amend 20.115 (7) (gc), 49.148 (4) (a), 49.79 (1) (b), 59.54 (25) (title), 59.54 (25) (a) (intro.), 66.0107 (1) (bm), 111.35 (2) (e), 114.09 (2) (bm) 1. (intro.), 114.09 (2) (bm) 4., 157.06 (11) (i), 289.33 (3) (d), 349.02 (2) (b) 4., 961.41 (1r), 961.41 (1x), 961.41 (3g) (c), 961.41 (3g) (d), 961.41 (3g) (em), 961.47 (1), 961.48 (3), 961.48 (5), 961.49 (1m) (intro.), 961.571 (1) (a) 11. (intro.), 971.365 (1) (a), 971.365 (1) (b), 971.365 (1) (c) and 971.365 (2); and to create 16.282, 20.115 (7) (ge), 20.192 (1) (t), 20.255 (2) (r), 20.435 (1) (r), 20.437 (3) (r), 20.505 (1) (t), 20.566 (1) (bn), 20.835 (2) (eq), 25.316, 48.47 (20), 66.04185, 73.17, 77.54 (71), 94.56, 94.57, 100.145, 108.02 (18r), 108.04 (5m), 111.32 (9m), 111.32 (11m), subchapter IV of chapter 139 [precedes 139.97], 157.06 (11) (hm), 238.139, 250.22, subchapter VIII of chapter 961 [precedes 961.70] and 973.016 of the statutes; relating to: recreational marijuana.

Analysis by the Legislative Reference Bureau

Crime

Recreational marijuana

Current law prohibits a person from manufacturing, distributing, or delivering marijuana; possessing marijuana with the intent to manufacture, distribute, or deliver it; possessing or attempting to possess marijuana; using drug paraphernalia; or possessing drug paraphernalia with the intent to produce, distribute, or use a controlled substance. This bill changes state law so that state law allows recreational use of marijuana.

The bill changes state law to allow a Wisconsin resident who is at least 21 years old, or a qualifying patient who is at least 18 years old, to possess no more than two ounces of marijuana and to allow a nonresident of Wisconsin who is at least 21 years old to possess no more than one-quarter ounce of marijuana. Generally, under the bill, a person who possesses more than the maximum amount he or she is allowed to possess, but not more than 28 grams of marijuana, is subject to a civil forfeiture not to exceed $1,000 or imprisonment not to exceed 90 days or both. A person who possesses more than 28 grams of marijuana is guilty of a Class B misdemeanor, except that, if the person takes action to hide the amount of marijuana he or she has and the person has in place a security system to alert him or her to the presence of law enforcement, a method of intimidation, or a trap that could injure or kill a person approaching the area containing the marijuana, the person is guilty of a Class I felony. The bill also eliminates the prohibition on possessing or using drug paraphernalia that relates to marijuana consumption.

The bill creates a process by which a person may obtain a permit to produce, process, or sell marijuana for recreational use and pay an excise tax for the privilege of doing business in this state. Sixty percent of the revenue collected from the tax is deposited into a segregated fund called the “community reinvestment fund”.

The bill requires a person to obtain separate permits from the Department of Revenue to produce, process, distribute, or sell marijuana, and requires marijuana producers and processors to obtain additional permits from the Department of Agriculture, Trade and Consumer Protection. The requirements for obtaining these permits differ based on whether the permit is issued by DOR or DATCP but, in general, a person may not obtain such a permit if he or she is not a state resident, is under the age of 21, or has been convicted of certain crimes; in addition, a person may not operate under a DOR permit within 500 feet of a school, playground, recreation facility, child care facility, public park, public transit facility, or library and may not operate as a marijuana producer under a DATCP permit within 500 feet of a school. A person who holds a permit from DOR must also comply with certain operational requirements.

Under the bill, a permit applicant with 20 or more employees may not receive a permit from DATCP or DOR unless the the applicant certifies that the applicant has entered into a labor peace agreement with a labor organization. The labor peace agreement prohibits the labor organization and its members from engaging in any economic interference with persons doing business in this state, prohibits the applicant from disrupting the efforts of the labor organization to communicate with and to organize and represent the applicant's employees, and provides the labor organization access to areas in which the employees work to discuss employment rights and the terms and conditions of employment. Current law prohibits the state and any local unit of government from requiring a labor peace agreement as a condition for any regulatory approval. The permit requirements under the bill are not subject to that prohibition.

The bill also requires DATCP and DOR to use a competitive scoring system to determine which applicants are eligible to receive permits. Each department must issue permits to the highest scoring applicants that it determines will best protect the environment; provide stable, family-supporting jobs to local residents; ensure worker and consumer safety; operate secure facilities; and uphold the laws of the jurisdictions in which they operate. Each department may deny a permit to an applicant with a low score.

Under the bill, a person who does not have a permit from DOR to sell marijuana may not sell, distribute, or transfer marijuana, or possess marijuana with the intent to sell or distribute it. A person who violates the prohibition is guilty of a Class I felony except that the felony classification increases to a Class H felony if the person sells, distributes, or transfers the marijuana to a person who is under the age of 21 (minor) and the person is at least three years older than the minor. The bill prohibits a DOR permittee from selling, distributing, or transferring marijuana to a minor and from allowing a minor to be on premises for which a permit is issued. If a permittee violates one of those prohibitions, the permittee may be subject to a civil forfeiture of not more than $500 and the permit may be suspended for up to 30 days. Under the bill, a minor who does any of the following is subject to a forfeiture of not less than $250 nor more than $500: procures or attempts to procure marijuana from a permittee; falsely represents his or her age to receive marijuana from a permittee; knowingly possesses marijuana for recreational use; or knowingly enters any premises for which a permit has been issued without being accompanied by his or her parent, guardian, or spouse who is at least 21 years of age or at least 18 years of age if a qualifying patient.

In addition, under the bill, a person who is cultivating marijuana plants without a permit who possesses more than six marijuana plants that have reached the flowering stage but not more than 12 at one time is subject to a civil forfeiture not to exceed $1,000 or imprisonment not to exceed 90 days or both. If the person possesses more than 12 plants that have reached the flowering stage at one time, the person is guilty of a Class B misdemeanor, except that, if the person takes action to hide the number of plants he or she has and the person has in place a security system to alert him or her to the presence of law enforcement, a method of intimidation, or a trap that could injure or kill a person approaching the area containing the plants, the person is guilty of a Class I felony.

The bill also requires DATCP to register entities as tetrahydrocannabinols (THC)-testing laboratories. The laboratories must test marijuana for contaminants; research findings on the use of medical marijuana; and provide training on safe and efficient cultivation, harvesting, packaging, labeling, and distribution of marijuana, security and inventory accountability, and research on medical marijuana.

Under the fair employment law, no employer or other person may engage in any act of employment discrimination against any individual on the basis of the individual's use or nonuse of lawful products off the employer's premises during nonworking hours, subject to certain exceptions, one of which is if the use impairs the individual's ability to undertake adequately the job-related responsibilities of that individual's employment. The bill specifically defines marijuana as a lawful product for purposes of the fair employment law, such that no person may engage in any act of employment discrimination against an individual because of the individual's use of marijuana off the employer's premises during nonworking hours, subject to those exceptions.

Under current law, an individual may be disqualified from receiving unemployment insurance benefits if he or she is terminated because of misconduct or substantial fault. The bill specifically provides that an employee's use of marijuana off the employer's premises during nonworking hours does not constitute misconduct or substantial fault unless termination for that use is permitted under one of the exceptions under the fair employment law. Also under current law, DWD must establish a program to test claimants who apply for UI benefits for the presence of controlled substances, as defined under federal law. If a claimant tests positive for a controlled substance, the claimant may be denied UI benefits, subject to certain exceptions and limitations. The bill excludes THC for purposes of this testing requirement. As such, under the bill, an individual who tests positive for THC may not be denied UI benefits.

The bill exempts THC, including marijuana, from drug testing for certain public assistance programs. Currently, a participant in a community service job or transitional placement under the Wisconsin Works program (W2) or a recipient of the FoodShare program, also known as the food stamp program, who is convicted of possession, use, or distribution of a controlled substance must submit to a test for controlled substances as a condition of continued eligibility. The Department of Health Services is currently required to request a waiver of federal Medicaid law to require drug screening and testing as a condition of eligibility for the childless adult demonstration project in the Medical Assistance program. Current law also requires DHS to promulgate rules to develop and implement a drug screening, testing, and treatment policy for able-bodied adults without dependents in the FoodShare employment and training program. The bill exempts THC from all of those drug-testing requirements and programs. In addition, because THC is not a controlled substance under state law under the bill, the requirement under current law that the Department of Children and Families promulgate rules to create a controlled substance abuse screening and testing requirement for applicants for the work experience program for noncustodial parents under W2 and the Transform Milwaukee Jobs and Transitional Jobs programs does not include THC.

Unless federal law requires otherwise, the bill prohibits a hospital, physician, organ procurement organization, or other person from determining the ultimate recipient of an anatomical gift on the sole basis of a positive test for the use of marijuana by a potential recipient.

The bill requires DOR to create and maintain a medical marijuana registry program whereby a person 18 years old or older who is a qualifying patient may obtain a registry identification card and purchase marijuana from a licensed retail establishment without having to pay the sales or excise taxes imposed on that sale. Under the bill, generally, a qualifying patient is an individual who has been diagnosed by a physician as having or undergoing a debilitating medical condition or treatment but does not include a person under the age of 18 years.

The bill changes state law regarding marijuana. It does not affect federal law, which generally prohibits persons from manufacturing, delivering, or possessing marijuana and applies to both intrastate and interstate violations.

state government

General state government

Equity grants

This bill requires the Department of Administration to provide grants to public, private, and nonprofit entities in this state that promote diversity and advance equity and inclusion.

health and human services

General health and human services

Health equity grants

This bill directs DHS to award grants to community organizations to implement community health worker care models. The bill also directs DHS to award grants to community organizations and local or tribal health departments to hire health equity strategists and to implement health equity action plans in small geographic areas.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB440-SSA1,1 Section 1 . 16.282 of the statutes is created to read:

AB440-SSA1,5,4 16.282 Equity grants. The department shall develop and administer a grants program to provide grants to public, private, and nonprofit entities in this state that promote diversity and advance equity and inclusion.

AB440-SSA1,2 Section 2. 20.115 (7) (gc) of the statutes is amended to read:

AB440-SSA1,6,4 20.115 (7) (gc) Industrial hemp and marijuana. All moneys received under s. 94.55 for regulation of activities relating to industrial hemp under s. 94.55 and to marijuana under s. 94.56.

AB440-SSA1,3 Section 3 . 20.115 (7) (ge) of the statutes is created to read:

AB440-SSA1,6,9 20.115 (7) (ge) Marijuana producers and processors; official logotype. All moneys received under s. 94.56 for regulation of activities relating to marijuana under s. 94.56, for conducting public awareness campaigns under s. 94.56, and for the creation of a logotype under s. 100.145.

AB440-SSA1,4 Section 4 . 20.192 (1) (t) of the statutes is created to read:

AB440-SSA1,6,13 20.192 (1) (t) Underserved community grants. From the community reinvestment fund, the amounts in the schedule for the purpose of providing underserved community grants under s. 238.139.

AB440-SSA1,5 Section 5 . 20.255 (2) (r) of the statutes is created to read:

AB440-SSA1,6,17 20.255 (2) (r) Sparsity aid; community reinvestment fund supplement. From the community reinvestment fund, the amounts in the schedule for sparsity aid to school districts under s. 115.436.

AB440-SSA1,6 Section 6 . 20.435 (1) (r) of the statutes is created to read:

AB440-SSA1,6,20 20.435 (1) (r) Health equity grants. From the community reinvestment fund, the amounts in the schedule for health equity grants under s. 250.22.

AB440-SSA1,7 Section 7. 20.437 (3) (r) of the statutes is created to read: