AB1040: Bill Text

The bill provides that the fair employment law does not apply to, and therefore does not protect against discrimination or discriminatory practices, any act of an employer based on an individual’s use of medical cannabis products, the individual’s other use of cannabis, or the individual testing positive for the presence of tetrahydrocannabinols. The bill further explicitly provides that the fair employment law does not require an employer to permit, accommodate, or allow the medical use of a medical cannabis product, or to modify any job or working conditions of any employee who engages in the medical use of medical cannabis products or who for any reason seeks to engage in the medical use of medical cannabis products. The bill also further provides that the fair employment law does not prohibit an employer from refusing to hire, terminating, discharging, disciplining, or otherwise discriminating against an individual with respect to hiring, discharging, tenure, promotion, or compensation, or in terms, conditions, or privileges of employment as a result, in whole or in part, of the individual’s medical use of medical cannabis products, the individual’s other use of cannabis, or the individual testing positive for the presence of tetrahydrocannabinols, regardless of any impairment or lack of impairment resulting therefrom.

Unemployment insurance; worker’s compensation

Currently, an individual whose work is terminated by an employer for misconduct by the employee connected with the employee’s work is ineligible to receive unemployment insurance (UI) benefits until the individual satisfies certain conditions. In addition, the wages paid to the individual by that employer are excluded from the employee’s base period wages for purposes of calculating the individual’s entitlement to UI benefits. “Misconduct,” for purposes of these provisions, is defined specifically as including a violation by an employee of an employer’s reasonable written policy concerning the use of a controlled substance if the employee 1) had knowledge of the policy and 2) admitted to the use of a controlled substance, refused to take a test, or tested positive for the use of a controlled substance in a test used by the employer in accordance with a testing methodology approved by DWD.

Also under current law, an employer is not liable for temporary disability benefits under the worker’s compensation law during an employee’s healing period if the employee is suspended or terminated for misconduct as defined above.

The bill retains these provisions regarding misconduct and further provides that such a reasonable written policy may include a drug-free workplace policy and may include a policy that includes testing for the presence of tetrahydrocannabinols.

Open housing law

Under the current open housing law and other laws, it is unlawful for any person to engage in certain forms of discrimination in housing based upon certain characteristics of an individual such as sex, race, color, sexual orientation, disability, religion, national origin, marital status, and family status. The open housing law protects against evictions and other actions that are made on the aforementioned bases. The open housing law is administered by DWD and allows for enforcement through civil actions brought by or on behalf of aggrieved persons and, in cases of alleged patterns or practices of discrimination, by the attorney general.

The bill adds use of medical cannabis products to the list of characteristics on which it is unlawful to discriminate in housing.

Limitation of local regulation

The bill prohibits political subdivisions from 1) regulating a medical cannabis grower, processor, testing laboratory, or dispensary; 2) regulating the lawful recommendation or delivery of medical cannabis products; 3) regulating the lawful use or possession of medical cannabis products; and 4) restricting in a zoning ordinance the location or operation of medical cannabis growing, processing, testing, or dispensing.

Sales tax exemption

The bill creates a sales tax exemption for the sale of a medical cannabis product sold by a dispensary to a person who holds a valid registry identification card.

Because this bill may increase or decrease, directly or indirectly, the cost of the development, construction, financing, purchasing, sale, ownership, or availability of housing in this state, the Department of Administration, as required by law, will prepare a report to be printed as an appendix to this bill.

Because this bill relates to an exemption from state or local taxes, it may be referred to the Joint Survey Committee on Tax Exemptions for a report to be printed as an appendix to the bill.

Because this bill creates a new crime or revises a penalty for an existing crime, the Joint Review Committee on Criminal Penalties may be requested to prepare a report.

For further information see the state and local fiscal estimate, which will be printed as an appendix to this bill.

AB1040,,4 The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB1040,1 Section 1. 15.01 (6) of the statutes, as affected by 2023 Wisconsin Act 20, is amended to read:

AB1040,,6 15.01 (6) “Division,” “bureau,” “section,” and “unit” means the subunits of a department or an independent agency, whether specifically created by law or created by the head of the department or the independent agency for the more economic and efficient administration and operation of the programs assigned to the department or independent agency. The office of credit unions in the department of financial institutions, the office of the inspector general in the department of children and families, the office of the inspector general in the department of health services, the office of medical cannabis regulation in the department of health services, and the office of children’s mental health in the department of health services have the meaning of “division” under this subsection. The office of the long-term care ombudsman under the board on aging and long-term care and the office of educational accountability and the office of literacy in the department of public instruction have the meaning of “bureau” under this subsection.

AB1040,2 Section 2. 15.194 (2) of the statutes is created to read:

AB1040,,8 15.194 (2) Office of medical cannabis regulation. There is created an office of medical cannabis regulation in the department of health services. The director of the office shall be appointed by the governor, and with the advice and consent of the senate appointed, to serve at the pleasure of the governor. If the position of director of the office remains vacant for a period of at least 90 days and the governor has not filled the vacancy, then the director of the office shall be appointed by a majority of the members of the joint committee on legislative organization.

AB1040,3 Section 3. 48.024 of the statutes is created to read:

AB1040,,10 48.024 Medical cannabis. (1) In this section:

AB1040,,11 (a) “Cannabis” has the meaning given for “marijuana” in s. 961.01 (14).

AB1040,,12 (b) “Medical cannabis product” has the meaning given in s. 94.57 (1) (f).

AB1040,,13 (2) A court may not consider the lawful use or possession of medical cannabis products under ch. 94 or 259 in determining custody or placement of a child under this chapter, except in cases in which a child has access to the medical cannabis products. A court may consider the unlawful use or possession of cannabis in determining custody or placement of a child under this chapter.

AB1040,4 Section 4. 59.54 (25) (a) (intro.) of the statutes is amended to read:

AB1040,,15 59.54 (25) (a) (intro.) The board may enact and enforce an ordinance to prohibit the any possession of marijuana, as defined in s. 961.01 (14), subject to the exceptions in s. 961.41 (3g) (intro.), that is unlawful under state law and provide a forfeiture for a violation of the ordinance; except that if a complaint is issued regarding an allegation of unlawful possession of more than 25 grams of marijuana, or unlawful possession of any amount of marijuana following a conviction in this state for possession of marijuana, the subject of the complaint may not be prosecuted under this subsection for the same action that is the subject of the complaint unless all of the following occur:

AB1040,5 Section 5. 66.0107 (1) (bm) of the statutes is amended to read:

AB1040,,17 66.0107 (1) (bm) Enact and enforce an ordinance to prohibit the any possession of marijuana, as defined in s. 961.01 (14), subject to the exceptions in s. 961.41 (3g) (intro.), that is unlawful under state law and provide a forfeiture for a violation of the ordinance; except that if a complaint is issued regarding an allegation of unlawful possession of more than 25 grams of marijuana, or unlawful possession of any amount of marijuana following a conviction in this state for possession of marijuana, the subject of the complaint may not be prosecuted under this paragraph for the same action that is the subject of the complaint unless the charges are dismissed or the district attorney declines to prosecute the case.

AB1040,6 Section 6. 66.0125 (1) (c) of the statutes is created to read:

AB1040,,19 66.0125 (1) (c) “Medical cannabis product” has the meaning given in s. 94.57 (1) (f).

AB1040,7 Section 7. 66.0125 (3) (a) of the statutes is amended to read:

AB1040,,21 66.0125 (3) (a) The purpose of the commission is to study, analyze, and recommend solutions for the major social, economic, and cultural problems that affect people residing or working within the local governmental unit, including problems of the family, youth, education, the aging, juvenile delinquency, health and zoning standards, discrimination in employment and public accommodations and facilities on the basis of sex, class, race, religion, sexual orientation, or ethnic or minority status and discrimination in housing on the basis of sex, class, race, use of medical cannabis products, religion, sexual orientation, ethnic or minority status, or status as a victim of domestic abuse, sexual assault, or stalking.

AB1040,8 Section 8. 66.0125 (3) (c) 1. b. of the statutes is amended to read:

AB1040,,23 66.0125 (3) (c) 1. b. To ensure to all residents of a local governmental unit, regardless of sex, race, sexual orientation, or color, the right to enjoy equal employment opportunities and to ensure to those residents, regardless of sex, race, use of medical cannabis products, sexual orientation, color, or status as a victim of domestic abuse, sexual assault, or stalking, the right to possess equal housing opportunities.

AB1040,9 Section 9. 66.0408 (4) of the statutes is created to read:

AB1040,,25 66.0408 (4) Cannabis-related business. (a) No political subdivision may regulate a medical cannabis grower, processor, or laboratory licensed under s. 94.57 or a medical cannabis dispensary operating pursuant to s. 259.10.

AB1040,,26 (b) No political subdivision may regulate the lawful recommendation or delivery of medical cannabis products, as defined in s. 94.57 (1) (f).

AB1040,,27 (c) A political subdivision may not restrict, in a zoning ordinance under s. 59.69, 60.61, or 62.23, the location or operation of medical cannabis growing, processing, testing, or dispensing.

AB1040,10 Section 10. 66.0418 (title) of the statutes is repealed and recreated to read:

AB1040,,29 66.0418 (title) Local food and drug regulation.

AB1040,11 Section 11. 66.0418 (3) of the statutes is created to read:

AB1040,,31 66.0418 (3) No political subdivision may regulate the lawful use or possession of cannabis or medical cannabis products under s. 94.57 or ch. 259.

AB1040,12 Section 12. 66.1011 (1) of the statutes is amended to read:

AB1040,,33 66.1011 (1) Declaration of policy. The right of all persons to have equal opportunities for housing regardless of their sex, race, color, disability, as defined in s. 106.50 (1m) (g), sexual orientation, as defined in s. 111.32 (13m), religion, national origin, use of medical cannabis products, as defined in s. 94.57 (1) (f), marital status, family status, as defined in s. 106.50 (1m) (k), status as a victim of domestic abuse, sexual assault, or stalking, as defined in s. 106.50 (1m) (u), lawful source of income, age, or ancestry is a matter both of statewide concern under ss. 101.132 and 106.50 and also of local interest under this section and s. 66.0125. The enactment of ss. 101.132 and 106.50 by the legislature does not preempt the subject matter of equal opportunities in housing from consideration by political subdivisions, and does not exempt political subdivisions from their duty, nor deprive them of their right, to enact ordinances that prohibit discrimination in any type of housing solely on the basis of an individual being a member of a protected class.

AB1040,13 Section 13. 66.1201 (2m) of the statutes is amended to read:

AB1040,,35 66.1201 (2m) Discrimination. Persons otherwise entitled to any right, benefit, facility, or privilege under ss. 66.1201 to 66.1211 may not be denied the right, benefit, facility, or privilege in any manner for any purpose nor be discriminated against because of sex, race, color, creed, sexual orientation, status as a victim of domestic abuse, sexual assault, or stalking, as defined in s. 106.50 (1m) (u), or national origin, or use of medical cannabis products, as defined in s. 94.57 (1) (f).

AB1040,14 Section 14. 66.1213 (3) of the statutes is amended to read:

AB1040,,37 66.1213 (3) Discrimination. Persons otherwise entitled to any right, benefit, facility, or privilege under this section may not be denied the right, benefit, facility, or privilege in any manner for any purpose nor be discriminated against because of sex, race, color, creed, sexual orientation, status as a victim of domestic abuse, sexual assault, or stalking, as defined in s. 106.50 (1m) (u), or national origin, or use of medical cannabis products, as defined in s. 94.57 (1) (f).

AB1040,15 Section 15. 66.1301 (2m) of the statutes is amended to read:

AB1040,,39 66.1301 (2m) Discrimination. Persons entitled to any right, benefit, facility, or privilege under ss. 66.1301 to 66.1329 may not be denied the right, benefit, facility, or privilege in any manner for any purpose nor be discriminated against because of sex, race, color, creed, sexual orientation, status as a victim of domestic abuse, sexual assault, or stalking, as defined in s. 106.50 (1m) (u), or national origin, or use of medical cannabis products, as defined in s. 94.57 (1) (f).

AB1040,16 Section 16. 66.1331 (2m) of the statutes is amended to read:

AB1040,,41 66.1331 (2m) Discrimination. Persons otherwise entitled to any right, benefit, facility, or privilege under this section may not be denied the right, benefit, facility, or privilege in any manner for any purpose nor be discriminated against because of sex, race, color, creed, sexual orientation, status as a victim of domestic abuse, sexual assault, or stalking, as defined in s. 106.50 (1m) (u), or national origin, or use of medical cannabis products, as defined in s. 94.57 (1) (f).

AB1040,17 Section 17. 66.1333 (3) (e) 2. of the statutes is amended to read:

AB1040,,43 66.1333 (3) (e) 2. Persons otherwise entitled to any right, benefit, facility, or privilege under this section may not be denied the right, benefit, facility, or privilege in any manner for any purpose nor be discriminated against because of sex, race, color, creed, sexual orientation, status as a victim of domestic abuse, sexual assault, or stalking, as defined in s. 106.50 (1m) (u), or national origin, or use of medical cannabis products, as defined in s. 94.57 (1) (f).

AB1040,18 Section 18. 77.54 (71) of the statutes is created to read:

AB1040,,45 77.54 (71) The sales price from the sale of a medical cannabis product, as defined in s. 94.57 (1) (f), sold by a dispensary, as defined in s. 259.01 (2), to a person who holds a valid registry identification card, as provided under s. 259.04.

AB1040,19 Section 19. 94.57 of the statutes is created to read:

AB1040,,47 94.57 Cannabis growers, medical cannabis processors, and medical cannabis testing laboratories. (1) Definitions. In this section:

AB1040,,48 (a) “Cannabis” has the meaning given for “marijuana” in s. 961.01 (14).

AB1040,,49 (am) “Dispensary” has the meaning given in s. 259.01 (2).

AB1040,,50 (b) “Grower” means a person that plants, grows, cultivates, or harvests cannabis.

AB1040,,51 (c) “Laboratory” means a person that obtains medical cannabis products or samples of such products from a licensed processor and conducts testing on those products or samples.

AB1040,,52 (d) “Licensee” means a grower, processor, or laboratory that holds a valid license from the department under this section.

AB1040,,53 (f) “Medical cannabis product” means a product that contains cannabinoids that have been extracted from cannabis plant material, that is intended for use by a patient, as defined in s. 259.01 (9), to alleviate the symptoms of a medical condition or to alleviate the symptoms of treatment for a medical condition, and that is processed for human consumption in the form of concentrates, oils, tinctures, edibles, pills, topical forms, gels, creams, vapors, patches, liquids, or forms administered by a nebulizer. “Medical cannabis product” does not include cannabis in a form that can be smoked.

AB1040,,54 (g) “Processor” means a person that obtains cannabis from a licensed grower, processes the cannabis into medical cannabis products, and packages and labels the medical cannabis products.

AB1040,,55 (h) “Resident” means an individual who maintains his or her place of permanent abode in this state. Domiciliary intent is required to establish that a person is maintaining his or her place of permanent abode in this state. Mere ownership of property is not sufficient to establish domiciliary intent. Evidence of domiciliary intent includes the location where the individual votes, pays personal income taxes, or obtains a driver’s license.

AB1040,,56 (2) Department duties. (a) The department shall oversee and regulate the growing of cannabis and the processing and testing of medical cannabis products.

AB1040,,57 (b) The department shall promulgate rules establishing safety and security requirements for the premises of growers, processors, and laboratories that handle cannabis or medical cannabis products.

AB1040,,58 (c) Annually, no later than October 15, the department shall submit a report to the chief clerk of each house of the legislature for distribution to the legislature under s. 13.172 (2) on the status of medical cannabis regulation under this section. The report shall include information on all of the following:

AB1040,,59 1. The number of current licensees.

AB1040,,60 2. The location by county of each licensee.

AB1040,,61 3. The number of applications for licenses under this section received over the previous year and the number of applications approved.

AB1040,,62 4. The expenses and revenues of the program over the previous year, all funds held in reserve for the program, and an estimation of the expenses and revenues of the program over the following year.

AB1040,,63 (3) License required. No person may operate in this state as a grower, processor, or laboratory without a license issued by the department under this section. A person who is an employee of a licensee is not required to obtain a separate license.

AB1040,,64 (4) Cannabis grower licenses. (a) License criteria. The department may issue a grower license to an applicant only if the department determines that all of the following requirements are met:

AB1040,,65 1. The applicant, or each principal officer or board member of the applicant, has not been convicted of any crime, unless at least 10 years have passed since the completion of any sentence imposed for the crime, including any period of incarceration, parole, or extended supervision, and any period of probation imposed for the crime. The department, with the assistance of the department of justice, shall conduct a background investigation of any applicant or each principal officer or board member of any applicant who applies for a grower license under this section, which shall include requiring all such persons to be fingerprinted on 2 fingerprint cards each bearing a complete set of the person’s fingerprints, or by other technologies approved by law enforcement agencies. The department of justice shall submit any such fingerprint cards to the federal bureau of investigation for the purposes of verifying the identity of the person fingerprinted and obtaining records of his or her criminal arrests and convictions.

AB1040,,66 2. The applicant pays the annual fee for growers established by the department under sub. (7).

AB1040,,67 3. The applicant is a resident, or at least 80 percent of the principal officers or board members of the applicant are residents.

AB1040,,68 4. The applicant submits to an inspection of the premises by the department, and the premises meets all requirements established by the department under sub. (2).

AB1040,,69 (b) Authorized activities. 1. A licensed grower may plant, grow, cultivate, and harvest cannabis; transport cannabis to or from any licensee; transfer or sell cannabis to a licensed processor that is contracted with the department under sub. (5); and engage in any related activities that are necessary for the operation, such as possessing and storing cannabis.

AB1040,,70 2. A licensed grower may operate only within an enclosed, locked facility.

AB1040,,71 3. A licensed grower may not plant, grow, cultivate, or harvest cannabis for personal, family, or household use.

AB1040,,72 (c) License renewal. A licensed grower shall annually renew the license issued under this section by applying to the department and paying the annual fee for growers established by the department under sub. (7).

AB1040,,73 (5) Medical cannabis processor contract, licenses. (a) Request for proposals; number of licenses, contracts limited. 1. The department shall obtain and review proposals from entities in this state to process medical cannabis products under this section in accordance with the department’s request-for-proposal procedures. Except as provided under subd. 2., the department shall enter into a contract with only one processor to process medical cannabis products in this state until there are at least 50,000 patients included in the patient and caregiver registry under s. 259.04, after which the department may license and contract with as many additional processors as necessary to process an adequate supply of medical cannabis products to meet the demand of patients in this state.

AB1040,,74 2. A processor with which the department contracts under subd. 1. may contract with one or more subcontractors to provide the processor’s services. Each subcontractor shall obtain a separate license under this subsection.