Damage Report and Recommended HOME BUSINESS LICENSE · 2018-07-19 · Every one of these business owners said that they attribute their business losses to the hardships imposed on

7/10/2018

Damage Report and Recommended

HOME BUSINESS LICENSE

CONTENTS

Retail and Dispensary Damages……………………..……...…………….2

Community Damages………………………………………….…………….2‐3

Private Residence Damages………………………………………………….4

Attempting Change 3 Minutes at a Time……………………..……….4

Proposed Damages……………………………………………………………….5

Home Business License (first draft).………….………………………6‐11

The following pages have a damage report from some of our research as well as some of our initial recommendations for a New License type. A “Home Business License” should be

considered for the benefit of the small, legacy farmer. Not all Cannabis operators want to be a

Walmart or Safeway. Some simply want to be a Mom and Pop market for sustenance or supplemental income. In large areas of California this has been a way of life for generations.

We will make ourselves available for any consultation or questions to develop this license.

Paul Hansbury and Susan Tibbon

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[email protected] 415‐987‐9540

mailto:[email protected]

7/10/2018

Retail / Dispensary Damages No one could have predicted what was going to happen after January 1st. This was “uncharted territory”.

Businesses took the precautions that they deemed necessary to anticipate the certain increase of business. Retailers were left with uncertainty as to who would have a license and for what products. We spoke only to the owners or principal buyers from the dispensaries. Many were unwilling to discuss financial matters.

Estimate from a Major Statewide Distributor ‐ “$50 million +. This also affects Distributors and Suppliers as well.”

DISPENSARY CITY / COUNTY Projected $ loss for destruction of inventory acquired before

January 1, 2018

Dispensary #1 San Francisco / San Francisco $350,000 ‐ $500,000 Dispensary #2 Ukiah / Mendocino County $200,000 Dispensary #3 Vallejo / Solano County $250,000 Dispensary #4 Laytonville / Mendocino County $45,000

Dispensary #5 Oakland / Alameda County $750,000 Dispensary #6 Oakland / Alameda County “Very Serious Financial Hardship”. Unwilling

to give any figures.

Dispensary #7 Oakland / Alameda County $0.00 “wish we had purchased more to be better prepared.”

Dispensary #8 San Francisco / San Francisco $500,000

Community Damages In the small community of Laytonville, in Mendocino County, we decided to go to the major businesses

in town to see how their businesses were doing since January 1, 2018. The responses we got were alarming.

Boomers is a restaurant/bar with weekend entertainment. The owners recently celebrated their 8‐year

anniversary. “April 2018 was the worst month on record.”

Gravier’s Chevron is a gas station with a mini‐mart and food concession. Gravier’s is the only business that stood to gain from the Willits bypass due to its location. As of May 5th, their “business is down 11% year to date”.

Geigers Long Valley Market is a full‐service market with a deli and butcher/meat and seafood department. They also have a large Ace Hardware department. “Since January 1st, we are seeing

roughly the same amount of people but our sales are down by over $100,000 per month.”

Weathertop Nursery is the local nursery selling all kinds of plants and gardening supplies. They are

celebrating 40 years in business. They supplied me with copies of checks for their state taxes for April

2017 and April 2018 showing a $30,000 difference. Their business is down 75%. (Photos below)

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7/10/2018

Every one of these business owners said that they attribute their business losses

to the hardships imposed on the cannabis growers and their inability to make a

living.

If you think that this is discouraging the black market you would be sadly mistaken.

Buyers are coming from out of state, knowing full well that the cultivators have no choice but to deal

with them. Consequentially, they are taking advantage of the situation and driving the price of cannabis down to record lows and the options for the small cultivator are nonexistent. They have to pay bills and

buy groceries too.

The growers that have been shut out have no documentable work experience/resume and can’t find work. They want to enter the newly legalized market, but can’t, either for financial reasons or the onerous compliance restrictions, or both.

Most businesses have had to lay off employees or reduce their hours and are working with skeleton crews.

Many small businesses have to take out bank loans to meet payroll or to pay their income taxes.

These are serious indicators that the cannabis regulatory process is not only negatively impacting individuals and their families financially, but entire communities. We are certain that Laytonville (or

Mendocino County, for that matter) is not a unique example.

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7/10/2018

Private Residence Damages For many years, in fact decades, the cannabis industry has been conducted from private residences. The

small farmer has no other choice. Most local jurisdictions have a provision for a Home Occupation or

Cottage Industry. AB 1616 (implemented in 2013) allows for Cottage Kitchens.

Although it is not always enforced, and unfortunately, the California Building Code has not made

provisions for these home businesses and therefore are subject to the codes for small businesses. The

administration needs to correct this and create an amendment to the California Building Code giving the

due consideration to these home businesses.

Local Building and Planning Departments are quite capable of determining what use or occupancy is suitable for their constituency and how to enforce and/or modify their ordinances.

The rationale for prohibiting cannabis operations in a private residence or having to walk through a private residence is unimaginable.

Building inspectors, plumbers, Public Utilities, cable TV installers have not been inconvenienced by having to enter a private residence. Having to build a new commercial building for a cannabis operation

is pretty “inconvenient”.

It is important to note that:

We have attended every outreach and public comment event that the state sponsored for the past three years plus, including the “Blue Ribbon Commission” in Garberville.

We attended every California Advisory Committee (CAC) meeting including the swearing in, in Sacramento.

We attended every Sub‐Committee meeting regarding Microbusiness in Sacramento. We attended the March CAC meeting in LA only to run out of time for the microbusiness

discussion. We anticipated the promised April meeting to address the microbusiness issue. It never

happened. We attended the CAC meeting on May 17 to finally address the microbusiness issues and after

a very confused first motion regarding local security measures (that failed due to the confusion) the remainder of the issues were tabled until the next meeting in July since none of the Committee members had a grasp on exactly what a microbusiness is! They directed the

Chair to write a letter to the Bureau for clarification and a definition. The very next morning (SURPRISE) the “EMERGENCY REGULATIONS READOPTION” were

released.

Most people we know just thought that everything was extended for another 6 months. Most people we know (including some dispensary/retail operations) were wrong. They didn’t

read it to see that there were “amendments”. Did anyone notice that the 5‐day comment period for the OAL spans the 3‐day holiday

weekend? (What a coincidence.)

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7/10/2018

Then there’s the proposed “Emergency Regulations Readoption”

Proposed Damages The Bureau seems to be seeking the elimination of the designation between Adult Use and Medical.

We agree that the current designations are less than appropriate. How can you tell if seed is medical

or recreational? The finished product, whether it is a manufactured product or a cannabinoid specific

strain of flower should be determined at the wholesale level. Judging from the trend in the evolution

of the regulations, our opinion about the desire to justify the total elimination of the distinction between A and M licenses seems very plausible. It makes it easier.

The microbusiness license needs to be scrapped and redefined with its own set of regulations because of its scale. That probably isn’t going to happen because the Bureau has already used up the original 18 months and half of the time allotted (by billionaire Sean Parker and consequently the voters) for any corrections.

The “Emergency Regulations Readoption” touts that it “Clarifies microbusiness requirements”

What the small farmer is hearing is: “Just in case you still don’t get it, we are doubling the entry fee, raising the maximum from greater than $4.5 million to $7.5 million, and cannabis operations may not

be conducted in a private residence nor be located in an area where one has to walk through a private residence. This microbusiness license is for the wealthy. Small farmers may not participate.

DO WE MAKE OURSELVES CLEAR!”

Since the Microbusiness has already been given to Big Business, we propose a new license for the small farmer called the Home Business License.

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7/10/2018

Home Businesses License It is a well‐known fact that the “Small Farmer” has been responsible for the base of most of the research that has been done to date regarding the Cannabis plant and has typically worked out

of their home. The “Small Farmer” has the experience and desire to further the research on a

smaller scale and further the industry.

Whether it is the current adult use trend or the latest medical breakthrough, the “Small

Farmer” has consistently produced the genetics for the body of evidence to bear out the resulting trend or medical study.

In an effort to further the intent of the statute, reduce diversion, and the recognition of the

facts stated above, we authorize the Bureau to adopt a new license that encourages the

contributions of the small farmer as the Home Business License.

While large Cannabis operations may have R&D departments, this license would allow the

“Small Farmer” to continue or establish a Home‐Based operation to document their efforts,

contribute to the industry and the community, and further the intent of the statute.

While the Home Business License holder would realize substantial reductions in current taxes,

regulations, and fees; the contributions by these licensees are expected to enhance current

fiscal expectations to the State by increased adoption (more legitimate licensees), competition

(more choices for the consumer), less onerous regulations due to the scale of the operation,

and a sense of community for other small farmers, ensuring a smoother transition to the

regulated marketplace.

It is the intent of this license to provide for limited commercial and industrial activities in

conjunction with a dwelling that do not alter or disturb the residential or rural nature of the

premises or its surroundings. Such limited commercial and industrial activities are commonly

known as cottage industries and are defined as follows:

(A) The particular activities conducted by the Home Business, and their operation and

appearance, shall not change or disturb the residential or rural character of the premises or its

surrounding.

(B) The activities are environmentally sound regarding the project site and region.

(C) No additional service demands will be created by the activities.

(D) Limit, one Home Business license per owner, regardless of how many residences they may

own.

(E) The Home Business License applicant must choose at least three of the four activities.

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7/10/2018 Cultivation‐ Less than 10,000 sq. ft. of canopy.

Manufacturing‐ Non‐Volatile. Limited to allowable volumes of cannabis.

Distribution‐ Limited to allowable volumes of cannabis and cannabis products.

Retail‐ Delivery and Events only. Limited to allowable volumes of cannabis and

cannabis products.

Home Businesses — Shall conform to the following requirements:

(A) Not more than three (3) employees working on the premises in addition to the members of

the household residing on the premises or family members;

(B) The Home Business shall be clearly incidental and subordinate to the use of the premises for

residential purposes;

(C) Home Business residences and accessory buildings shall be code compliant to residential

building and occupancy standards including Limited Density Rural Dwellings (Class K) if

applicable. Additional commercial space may be used at a different location under an

accessory license to the Home Business however the volume of cannabis restrictions set forth

by the Home Business License and local zoning compliance for the commercial facility shall

apply.

(E) Home Businesses shall not be required to meet the ADA requirements for a commercial

building, since the residential occupancy is preserved, but rather to suit the reasonable needs

of their employees (if any). If the public is allowed on the premises, the ADA requirements shall

be met with a minimum of compliance as prescribed by a Certified Accessibility Specialist

(CASp).

(D) Multiple activities may be permitted within the Home Business. The total area occupied by

all cannabis activities within the Home Business, including storage, shall not exceed two

thousand (2,000) square feet with the exception that the total canopy of the cultivation is

excluded; Additional commercial space may be used at a different location under an accessory

license to the Home Business however the volume of cannabis restrictions set forth by the

Home Business License and local zoning compliance for the commercial facility shall apply.

(E) All aspects of the Home Business shall be located and conducted within a dwelling unit or

enclosed accessory building(s), with the exception of outdoor storage of materials, products or

vehicles as specifically provided by the use permit when completely screened from the street

and adjoining properties. There shall be no other change in the outside appearance of the building or premises, except one (1) non‐illuminated sign not exceeding four (4) square feet;

Additional commercial space may be used at a different location under an accessory license to

the Home Business however the volume of cannabis restrictions set forth by the Home Business License and local zoning compliance for the commercial facility shall apply.

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7/10/2018 (F) The sale of merchandise not produced on the premises (except mail order only businesses)

shall be incidental and accessory to the merchandise or service produced by the Home Business

and shall not be advertised in any manner;

(G) Not more than three (3) delivery vehicles shall access the premises each day;

(H) Large vehicles or construction equipment (such as trucks of over one (1) ton rating) shall not

be operated, maintained, or parked in public view in connection with a Home Business, except

to the extent customarily used by residents in the surrounding neighborhood on their own

property. Not more than one (1) vehicle for servicing may be parked in public view;

(I) No equipment or process used in the Home Business shall create noise, vibration, glare,

fumes, dust, odors, smoke, electrical interference or other impacts in excess of those

customarily generated by single‐family residential uses in the neighborhood.

(J) The licensee shall sign a document indemnifying both the State of California and its branches

as well as the local jurisdiction and its staff from any and all damages due to its approval of the

license and/or security measures.

PREMISES OF A HOME BUSINESS 1. The overall premises of a Home Business need not be restricted to a single parcel but

rather may include another parcel or parcels, under the ownership or control of the Home Business licensee. An accessory license may be granted for accessory premises for an activity on separate parcel limited to one accessory license per activity.

VOLUME OF CANNABIS THAT MAY BE USED BY A HOME BUSINESS 1. ALL Home Business licensees may only outsource material from other licensed

cultivators whose aggregated canopy is 10,000 square feet of canopy or less. a. For example:

i. From one licensee that cultivates 10,000 square feet of canopy or less ii. From four licensees that cultivate 2,500 square feet of canopy or less iii. From one licensee that cultivates 5,000 square feet of canopy or less plus

two licensees that cultivate 2,500 square feet of canopy or less. Etc. b. Home Business licensees who include cultivation as an activity may also

outsource additional material as described above. c. Notwithstanding, Home Business licensees who include manufacturing, and can

demonstrate the capability to do so, may outsource additional cannabis, from any licensee, that has been tested and found unsuitable due to natural pathogens (not pesticides) for remediation (not to exceed 20 lbs. per Home Business Licensee).

MANUFACTURING 1. Equipment

a. Home Business manufacturers may only use:

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7/10/2018 i. Non‐volatile Solvents (including Co2 and ethanol). ii. Equipment intended for Home or Hobby use. iii. Commercial grade equipment if available for private consumers. iv. Homemade or Custom‐built equipment if it meets safety requirements

and is approved by the local jurisdiction. 2. Facilities

a. Areas for Home Business Manufacturers shall: i. Be kept clean and well lit. ii. Have appropriate fire suppression measures (e.g. Fire extinguisher). iii. Have a barrier (permanent or temporary) to adequately separate the

area from the rest of the residence from non‐authorized persons, children, and/or animals while the cannabis activity is being performed.

iv. Include “S” license facilities. v. Be prohibited from performing any other activity in the area while the

cannabis activity is performed. vi. Be inspected by the local authority for compliance. vii. Maintain clearly defined and lockable areas for storage of raw cannabis

material or ingredients and finished cannabis products. viii. Be entitled to relaxed security measures at the discretion of the local

jurisdiction. DISTRIBUTION

1. A licensed Home Business shall: a. Perform all of the duties of a licensed Distributor within the limitations that are

allowed regarding volume of a Home Business. b. Be entitled to relaxed security measures at the discretion of the local jurisdiction.

SECURITY The bureau shall establish minimum security and transportation safety requirements for the commercial distribution and delivery of marijuana and marijuana products. The transportation safety standards established by the bureau shall include, but not be limited to, minimum standards governing the types of vehicles in which marijuana and marijuana products may be distributed and delivered and minimum qualifications for persons eligible to operate such vehicles. (c) Licensed retailers and microbusinesses, and licensed nonprofits under Section 26070.5, shall implement security measures reasonably designed to prevent unauthorized entrance into areas containing marijuana or marijuana products and theft of marijuana or marijuana products from the premises. These security measures shall include, but not be limited to, all of the following: (1) Prohibiting individuals from remaining on the licensee’s premises if they are not engaging in activity expressly related to the operations of the dispensary. (2) Establishing limited access areas accessible only to authorized personnel.

(3) Other than limited amounts of marijuana used for display purposes, samples, or immediate sale, storing all finished marijuana and marijuana products in a secured and locked room, safe, or vault, and in a manner reasonably designed to prevent diversion, theft, and loss.

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7/10/2018 1. The Bureau shall authorize the local jurisdiction to use its discretion and be responsible

for the review and approval of the Home Business License applicant’s Security Plan. a. This plan shall be “Site Specific” based on circumstances and conditions

pertaining to the premises and for the activities of the licensee. b. The approved Security Plan shall not create an undue burden or hardship to the

licensee. c. The Security Plan shall include language pertaining to the treatment of cannabis

waste and destruction. CULTIVATION

1. For the purpose of clarification, Canopy for outdoor cultivation shall mean the dripline of the mature cannabis plant . This shall be calculated for each plant by the licensee and added together to arrive at the total plant canopy.

INSURANCE 1. Insurance limits shall be determined in direct relationship to the gross receipts of

the Home Business as well as its risks as determined by the insurer. SPECIALTY MEDICINES

1. Medical Home Businesses may produce small quantities of specialized medicine with specific potency and/or cannabinoid ratio and/or delivery methods (e.g. suppositories) from batches of medicines/extracts that have been previously tested for compliance without having the additional expense of compliance testing for the finished product.

a. These specialty small quantities may be used for individual patients with specific needs or for research.

b. Aggregated quantity of the cannabis products used to formulate these specialty medicines shall not exceed 40 grams of cannabis extract per production run.

c. These specialty cannabis formulas may not contain any other active ingredients and are limited to three (3), commercially available, inactive ingredients.

d. Blending of previously tested batches is permissible for specialty medicines to achieve the desired finished product.

e. Amounts of previously tested product used for these specialty medicines shall be entered and recorded (with batch numbers) using the track and trace system.

f. These specialty medicines may only be produced by a Home Business that chooses manufacturing and distribution as activities and may only be sold to the end user by a Medical Retail licensee or Medical Home Business that chooses the retail activity as well.

TESTING PROCEEDURES 1. Home Businesses may be allowed to bring batches to a third‐party testing facility to

reduce costs. a. Batches for Home Businesses will, likely, be small. b. Compliance costs per batch will remain the same. c. A Home Business that includes distribution as an activity may be able to make

plausible/reasonable arrangements, with the third‐party testing agency, to deliver the cannabis product batch(es) for compliance testing in a lockable trailer

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7/10/2018 (or similar acceptable method) that would have a security seal applied after sample retrieval and until the testing quarantine is complete.

d. Since Home Business batches would, likely, be small, they shall be granted the option to retrieve the samples taken by the testing lab for their destruction, inclusion into the marketplace, or submitted for remediation.

e. Transportation manifest would be required to be generated and recorded with Track and Trace system with a notation “for testing”.

f. Video procedures may be done with a remote camera. TAXES AND FEES

1. Due to the equal responsibilities with much lower volume and to drive adoption:

a. Home Business Licensees shall receive a 50% reduction to the current

Cultivation Tax if cultivation is included as one of the chosen activities. b. Home Business License application fees shall be established at 50% of the

current Microbusiness fees.

2. Home Business Licensees, that act as distributors, are still required to collect and

submit the cultivation tax from the cultivators they interact with as well as the

excise tax from other retailers including any accrued by the Home Business licensee

itself if retail is a chosen activity.

3. A small farmer will likely grow various strains of cannabis with varying cannabinoid

profiles. Compliance testing shall be allowable for the entire harvest, as a batch, with separate cannabinoid profile testing for individual strains (“lots” within a batch)

instead of costly full compliance testing for each strain (lot).

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aBIZinaBOX Inc 617 Grove St., Suites A & C Evanston, IL 60201 USA

Main T: 415.579.2692 Oakland T: +1.510.761.9977 New York T: +1.732.893.7648 F: +1.847.563.1364 Writer’s C: +1.847.533.3403 Writer’s E: [email protected]

W: https:aBIZinaBOX.com W:https://abizinaboxCANNABIS.com

June 27, 2018

By Email and Federal ExpressXavier Becerra, Esq.Office of the Attorney GeneralCalifornia Department of Justice1300 I Street Sacramento, CA 95814

Tamara Colson, Esq. Assistant Chief Counsel California Dept. of Consumer Affairs Bureau of Cannabis Control [“BCC”] 2920 Kilgore Road Rancho Cordova, CA 95670

Michele Dias, Esq. General Counsel California Dept. of Food and Agriculture [“CDFA”] CalCannabis 1220 N Street, 4th Floor Sacramento, CA 95814

Karen Schwartz, Esq. California Dept. of Public Health [“CDPH”] Manufactured Cannabis Safety Board [“MCSB”] Office of Legal Services CalCannabis 1615 Capitol Avenue Sacramento, CA 95814

Re: Representation of Cannabis License Applicants and Licensees

Dear Counsel,

We are writing to follow up on discussions that we have had as follow up to inquiries which we have made to each of your respective agencies in connection with the policies and procedures which were going to be put in place with respect to the representation of cannabis license applicants and licensees with your respective agencies. We are licensed as certified public accountants though our


expectation is that similar rules would apply to attorneys. The statute and regulations which apply to the commercial cannabis industry in California are quite evolving rapidly and, of necessity, quite complex.

The completion of license applications as well as the completion of numerous regulatory compliance tasks each of your respective agencies may require specialized technical skills which are beyond the reasonable capabilities of a licensee or applicant. As such, administrative agencies make provision for representation of applicants and licensees by third parties, in many cases the individuals who are permitted to represent an individual before an agency are required to have professional licensure. We are going to use agencies with which we are familiar as tax professionals, specifically the California Franchise Tax Board [“FTB”] and the California Dept. of Tax and Fee Administration [“CDTFA”] provide for the authorization of representation with FTB Form 3520 or CDTFA Form 392, copies attached.

The response to our inquiry with respect to the completion of a license application from CDPH MCSB stated “Because of this definition in state law, I do not anticipate any immediate changes to our system to allow a representative (non-owner) to complete the application”. We received similar responses from BCC and CalCannabis.

We are aware that CDPH does has a “Special Power of Attorney” for HIV related matters [Form CDPH 8456] and Marriage Licenses [Form VS124] but, we have not been able to identify a comparable form for Cannabis Licenses and other matters involving MSCB. We had submitted a similar question to the BCC’s initial Cannabis Advisory Committee Subcommittee Survey on January 30, 2018 and to our knowledge, no action was ever taken on the matter. Our experience with CalCannabis similarly failed to yield a mechanism for representation.

A party to an action may appear in his own proper person or by attorney1. The right to petition government for the redress of grievances is provided for in the California Constitution2. The California

1 Board of Commissioners vs. Younger (1865), 29 Cal, 147, 149

2 Article 1, Section 3 states

(a) The people have the right to instruct their representatives, petition government for redress of grievances, and assemble freely to consult for the common good.

(b)

(1) The people have the right of access to information concerning the conduct of the people’s business, and, therefore, the meetings of public bodies and the writings of public officials and agencies shall be open to public scrutiny.

(2) A statute, court rule, or other authority, including those in effect on the effective date of this subdivision, shall be broadly construed if it furthers the people’s right of access, and narrowly construed if it limits the right of

Code of Judicial Ethics provides “. A judge shall accord to every person who has a legal interest in a proceeding, or that person's lawyer, full right to be heard according to law”3.

access. A statute, court rule, or other authority adopted after the effective date of this subdivision that limits the right of access shall be adopted with findings demonstrating the interest protected by the limitation and the need for protecting that interest.

(3) Nothing in this subdivision supersedes or modifies the right of privacy guaranteed by Section 1 or affects the construction of any statute, court rule, or other authority to the extent that it protects that right to privacy, including any statutory procedures governing discovery or disclosure of information concerning the official performance or professional qualifications of a peace officer.

(4) Nothing in this subdivision supersedes or modifies any provision of this Constitution, including the guarantees that a person may not be deprived of life, liberty, or property without due process of law, or denied equal protection of the laws, as provided in Section 7.

(5) This subdivision does not repeal or nullify, expressly or by Implication, any constitutional or statutory exception to the right of access to public records or meetings of public bodies that is in effect on the effective date of this subdivision, including, but not limited to, any statute protecting the confidentiality of law enforcement and prosecution records.

(6) Nothing in this subdivision repeals, nullifies, supersedes, or modifies protections for the confidentiality of proceedings and records of the Legislature, the Members of the Legislature, and its employees, committees, and caucuses provided by Section 7 of Article IV, state law, or legislative rules adopted in furtherance of those provisions; nor does it affect the scope of permitted discovery in judicial or administrative proceedings regarding deliberations of the Legislature, the Members of the Legislature, and its employees, committees, and caucuses.

(7) In order to ensure public access to the meetings of public bodies and the writings of public officials and agencies, as specified in paragraph (1), each local agency is hereby required to comply with the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code) and the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5 of the Government Code), and with any subsequent statutory enactment amending either act, enacting a successor act, or amending any successor act that contains findings demonstrating that the statutory enactment furthers the purposes of this section.

(Sec. 3 amended June 3, 2014, by Prop. 42. Res.Ch. 123, 2013.)

3 Article III (b)(7) states “A judge shall accord to every person who has a legal interest in a proceeding, or that person’s lawyer, the full right to be heard according to law. * Unless otherwise authorized by

As such, without continuing to expound a legal analysis that we would expect to be common knowledge among each of the respective agencies, on behalf of our both our clients, and or clients, whom we represent as California business entities and individuals, and our firm we are requesting that information with respect to the policies and procedures to permit us to facilitate such representation be provided. The lack of those policies and procedures would leave the prosecution of a lawsuit as the sole means to obtain such rights.

We appreciate your cooperation and look forward to your written response.

Very Truly Yours,

Jordan S. Zoot, CPA, P.C. By Jordan S. Zoot, CPA CA. Lic. 132647

law, * a judge shall not independently investigate facts in a proceeding and shall consider only the evidence presented or facts that may be properly judicially noticed.

RESPONSE TO OUR INQUIRY RECEIVED FROM CDPH MCSB Sat, Jan 6,

2:42 PM

CDPH Manufactured Cannabis Safety Branch <[email protected]> to BCC@DCA, CDFA, me

Hi Jordan, I can address the procedures and future plans for the Manufactured Cannabis Safety Branch. I’ll let the Bureau and CDFA weigh in with responses from their particular offices.

The California Business and Professions Code, in section 26001(c), defines a cannabis license “applicant” as “an owner applying for a state license pursuant to this division.” If the member of your firm who is completing the application for the business is considered and disclosed as an owner, they may complete the application on behalf of the business. Because of this definition in state law, I do not anticipate any immediate changes to our system to allow a representative (non-owner) to complete the application.

An owner only needs to complete one Live Scan form/fingerprinting for our office. Our annual license system is built so that once an owner is registered, they can be associated to multiple businesses. Thus, they only need one login and one Live Scan for our office.

They will need to complete Live Scans for other offices that request them, though. The Live Scan forms only authorize the one agency designated on the form to view the criminal background information. So, the owner will need to complete one for each agency to which they are applying for a license.

Manufactured Cannabis Safety Branch California Department of Public Health www.cdph.ca.gov/mcsb www.cannabis.ca.gov

www.cannabis.ca.gov

www.cdph.ca.gov/mcsb


CDTFA-392 (FRONT) REV. 11 (1-18) STATE OF CALIFORNIA

POWER OF ATTORNEY CALIFORNIA DEPARTMENT OF TAX AND FEE ADMINISTRATION EMPLOYMENT DEVELOPMENT DEPARTMENT

Check below to indicate the appropriate agency. Please note that a separate form must be completed and provided to each agency checked.

CALIFORNIA DEPARTMENT OF EMPLOYMENT DEVELOPMENT DEPARTMENT TAX AND FEE ADMINISTRATION PO BOX 826880 MIC 28 PO BOX 942879 SACRAMENTO CA 94280-0001 SACRAMENTO, CA 94279-0001 1-916-654-7263 • FAX 1-916-654-9211 1-800-400-7115 (TTY:711)

TAXPAYER’S OR FEEPAYER’S NAME BUSINESS OR CORPORATION NAME TELEPHONE NUMBER

( ) FAX NUMBER

( ) SOCIAL SECURITY NUMBER FEDERAL EMPLOYER IDENTIFICATION NUMBER CALIFORNIA SECRETARY OF STATE NUMBER(S)

CALIFORNIA DEPARTMENT OF TAX AND FEE ADMINISTRATION ACCOUNT/PERMIT(S) EDD EMPLOYER ACCOUNT NUMBER

MAILING ADDRESS (Number and Street, City, State, ZIP Code)

INDIVIDUAL PARTNERSHIP CORPORATION LIMITED LIABILITY COMPANY

OTHER

As owner, officer, receiver, administrator, or trustee for the taxpayer or feepayer, or as a party to the tax or fee matter before the:

California Department of Tax and Fee Administration Employment Development Department I hereby appoint: [enter below the individual appointee(s) name(s), address(es) (including ZIP code), telephone number(s) and fax number(s)—do not enter names of accounting or law firms, partnerships, corporations, etc., as the appointee name] APPOINTEE NAME APPOINTEE NAME

APPOINTEE BUSINESS NAME (if applicable) APPOINTEE BUSINESS NAME (if applicable)

APPOINTEE ADDRESS (Number and Street) APPOINTEE ADDRESS (Number and Street)

(City) (State) (ZIP Code) (City) (State) (ZIP Code)

TELEPHONE NUMBER

( ) FAX NUMBER

( ) TELEPHONE NUMBER

( ) FAX NUMBER

( )

As attorney(s)-in-fact to represent the taxpayer(s) or feepayer(s) for the following tax or fee matters: [specify type(s) of tax]

Tax and Fee Programs Administered by CDTFA Benefit Reporting Payroll Tax Law Other:

SPECIFY THE TAX OR FEE YEAR(S) OR PERIOD(S)

The attorney(s)-in-fact (or any of them) are authorized, subject to revocation, to receive confidential tax information and to perform on behalf of the taxpayer(s) the following acts for the tax or fee matters described above: [check the box(es) for the powers granted]

General Authorization (including all acts described below). Specific Authorization (selected acts described below).

To confer and resolve any assessment, claim or collection of a deficiency or other tax or fee matter pending before the identified agency and attend any meetings or hearings thereto for the specified law identified above. To receive, but not to endorse and collect, checks in payment of any refund of taxes, penalties or interest. To execute petitions, claims for refund and/or amendments thereto. To execute consents extending the statutory period for assessment or determination of taxes. To represent the taxpayer for changes to their mailing address for any and all Payroll Tax Law, Benefit Reporting, both Payroll Tax Law and Benefit Reporting.

(The back of this form must be completed)

CDTFA-392 (BACK) REV. 11 (1-18)

To execute settlement agreements under section 1236 of the California Unemployment Insurance Code. To delegate authority or to substitute another representative. To Other acts (specify):

This Power of Attorney revokes all earlier Power(s) of Attorney on file with the California Department of Tax and Fee Administration or the Employment Development Department as identified above for the same matters and years or periods covered by this form, except for the following: [specify to whom granted, date and address, or refer to attached copies of earlier power(s)] NAME DATE POWER OF ATTORNEY GRANTED

ADDRESS (Number and Street, City, State, ZIP Code)

Unless limited, this Power of Attorney will remain in effect until the final resolution of all tax or fee matters specified herein. [specify expiration date if limited term] TIME LIMIT/EXPIRATION DATE (for California Department of Tax and Fee Administration purposes)

Signature of Taxpayer(s) or Feepayer(s)—If a tax or fee matter concerns a joint return, both spouses must sign if joint representation is requested. If you are a corporate officer, partner, guardian, tax or fee matters partner/person, executor, receiver, registered domestic partner, administrator, or trustee on behalf of the taxpayer or feepayer, by signing this Power of Attorney you are certifying that you have the authority to execute this form on behalf of the taxpayer or feepayer.

► IF THIS POWER OF ATTORNEY IS NOT SIGNED AND DATED BY AN AUTHORIZED INDIVIDUAL, IT WILL BE RETURNED AS INVALID.

SIGNATURE TITLE (if applicable) DATE

PRINT NAME TELEPHONE

( ) SIGNATURE TITLE (if applicable) DATE

PRINT NAME TELEPHONE

( )

PAGE 1 FTB 3520 BE (NEW 12-2017)

To submit electronically, go to ftb.ca.gov, log in to MyFTB,

and select File a Power of Attorney.

Business Entity or Group Nonresident Power of Attorney Declaration Use this legal document to authorize a specifc individual(s) to receive confdential information and represent you in all matters before the Franchise Tax Board (FTB). Generally, this authority will expire six years from the date this FTB 3520 BE, Business Entity or Group Nonresident Power of Attorney (POA) Declaration, is signed or an FTB 3520 RVK, Power of Attorney Declaration Revocation, is fled. Submitting this POA Declaration will not revoke any previously submitted POA Declarations with overlapping authorizations. Use FTB 3520 RVK to revoke previously fled POA Declarations. We do not accept non-FTB POA Declarations. POA Declarations fled before January 1, 2018, will generally remain in effect until revoked or expired. For more information and instructions, go to ftb.ca.gov/POA.

Part 1 – Business Entity Information

Select only one box below. If you select both boxes, your POA Declaration will be invalid and will be rejected.

Business Entity 540NR Group Nonresident Return (A subsidiary not included with the unitary taxpayer’s group tax (If the POA Declaration is related to matters for return must fle its own POA Declaration) the 540NR group nonresident tax return)

Full Legal Business Name

CA Corporation Number CA SOS Number (or FTB issued number) FEIN Phone

Street Address (number and street) or PO Box Apt./Suite

City State ZIP Code

Part 2 – Representative(s)

Only individuals may be named as representative(s). You must list a primary representative below. The business entity in Part 1 appoints the following individual(s) as attorney(s)-in-fact. Complete Page 3 to appoint additional representative(s). All representatives listed on your POA Declaration will have the ability to remove a representative from your POA Declaration. Primary Representative’s Name (frst name, middle initial, and last name)

Cal CPA CA State Bar Number CTEC Enrolled Agent Number

Street Address (number and street) or PO Box

City State

Email (include your representative’s email address to ensure they receive email notifcations) Fax Phone

Additional Representative’s Name (frst name, middle initial, and last name)

PTIN

Apt./Suite

ZIP Code

Cal CPA CA State Bar Number CTEC Enrolled Agent Number PTIN


City State ZIP Code

Email (include your representative’s email address to ensure they receive email notifcations) Phone Fax

8561173

https://ftb.ca.gov

PAGE 2 FTB 3520 BE (NEW 12-2017)

Part 3 – Authorization for All Years or Specifc Income Periods Your POA Declaration Covers

You must select either Yes or No below. Your selection authorizes representatives in Part 2 and Page 3 to contact FTB about your account, receive and inspect your confdential information, represent you in all FTB matters, and request information we receive from the Internal Revenue Service (IRS) for either “all years” or “specifc income periods” indicated below. If you authorize “all years” and “specifc income periods,” the specifc income periods privilege prevails. Enter “NA” (not applicable) or strike through any blank year felds. If you do not select either Yes or No or select both Yes and No, we will process the authorization as a No. This may cause your POA Declaration to be invalid, and it may be rejected. If you authorized “all years,” this will include previous, current, and future years up to the expiration date. If you authorized “specifc income periods,” you can designate future years or income periods up to fve years from the POA Declaration signature date.

YES NO

Authorized All Years Year Begins on: Year Ends on:

Or (MM/DD/YYYY) (MM/DD/YYYY)YES NO

Authorized Specific Income Periods* . . . . . . . . . . . . . . . . . . . . . . . .

* For example, Single Year: 01/01/2017-12/31/2017 Year Range: 01/01/2017-06/30/2017 Multiple Years: 01/01/2015-12/31/2017

–

–

–

–

Part 4 – Additional Authorizations

Select either Yes or No below for additional authorizations you would like to grant your representative(s) beyond those described in Part 3. If you do not select either Yes or No or select both Yes and No for any additional authorizations below, we will process the authorization as a No. For more information, go to ftb.ca.gov/POA.

YES NO

Add representative(s)

YES NO

Receive, but not endorse, refund check(s)

YES NO

Waive the California statute of limitations (SOL)

YES NO

Execute settlement and closing agreements

YES NO

Other acts (describe on Page 4)

Part 5 – Signature Authorizing Power of Attorney Declaration

I am a corporate offcer, general partner, authorized managing member, or tax matter partner on behalf of the business entity in Part 1, and I certify I have the authority to sign this Power of Attorney Declaration on behalf of the business entity. I understand that submitting this POA Declaration will not revoke any previously submitted POA Declarations with overlapping privileges. FTB will reject this POA Declaration if not signed and dated by an authorized individual.

Print Name Title (required for business entities)

Signature Date

8562173

x

PAGE 3 FTB 3520 BE (NEW 12-2017)

Business Entity or Group Nonresident Power of Attorney Declaration The business entity in Part 1 appoints the following additional representative(s) as attorney(s)-in-fact. Include as many copies of this page as needed to list all representatives. Do not return this page if blank.


PTINEnrolled Agent NumberCTECCA State Bar NumberCal CPA


City State ZIP Code





City State ZIP Code

Fax Email (include your representative’s email address to ensure they receive email notifcations) Phone




City State ZIP Code





City State ZIP Code


8563173

PAGE 4 FTB 3520 BE (NEW 12-2017)

Other Acts Authorization(s) Submit this page if you selected Yes to the Other Acts Authorization box from Part 4. If you did not select Yes or selected both Yes and No within Part 4 - Additional Authorizations, Other Acts, we will disregard this page without the listed authorizations being granted. Describe the specifc other acts you authorize your representative(s) in Part 2 and Page 3 to perform before FTB. Authorizations listed in Part 3 and Part 4 prevail over conficting authorizations listed in this section. Do not return this page if blank.

Franchise Tax Board Privacy Notice To learn about your privacy rights, how we may use your information, and consequences if you do not provide information we request, go to ftb.ca.gov/forms and search for 1131. To request this notice by mail, call 800.338.0505 and enter form code 948 when instructed.

Submit your POA Declaration online or by mail.*

Online: Log in to MyFTB and select File a Power of Attorney.

Mail: POA/TIA UNIT FRANCHISE TAX BOARD PO BOX 2828 RANCHO CORDOVA CA 95741-2828

*Paper submissions result in longer processing time frames. Mail this Declaration separately from tax returns or correspondence. Keep a copy of all documents for your records. For more information, go to ftb.ca.gov/POA.

8564173

https://ftb.ca.gov/POA

https://ftb.ca.gov/forms

PAGE 1 FTB 3520 PIT (REV 09-2017)

To submit electronically, go to ftb.ca.gov, log in to MyFTB,

and select File a Power of Attorney.

Individual or Fiduciary Power of Attorney Declaration Use this legal document to authorize a specifc individual(s) to receive confdential information and represent you in all matters before the Franchise Tax Board (FTB). Generally, this authority will expire six years from the date this FTB 3520 PIT, Individual or Fiduciary Power of Attorney (POA) Declaration, is signed or an FTB 3520 RVK, Power of Attorney Declaration Revocation, is fled. Submitting this POA Declaration will not revoke any previously submitted POA Declarations with overlapping authorizations. Use FTB 3520 RVK to revoke previously fled POA Declarations. We do not accept non-FTB POA Declarations. If you are signing on behalf of a fduciary or in place of an individual, you must attach notarized or legal documentation indicating you have this authorization. POA Declarations fled before January 1, 2018, will generally remain in effect until revoked or expired. For more information and instructions, go to ftb.ca.gov/POA.

Part 1 – Taxpayer Information

Select only one box below. Submit a separate FTB 3520 PIT, Individual or Fiduciary Power of Attorney Declaration, for each individual.

Individual Fiduciary (If a joint tax return is fled, each spouse/Registered Domestic (Estates or Trusts - FEIN required) Partner (RDP) must complete their own POA Declaration)

Individual (frst name, middle initial, last name, suffx) or Estate or Trust Name SSN or ITIN

Street Address (number and street) or PO Box Apt./Suite FEIN (required for Fiduciary)

City State ZIP Code Phone

Part 2 – Representative(s)

Only individuals may be named as representative(s). You must list a primary representative below. The individual or fduciary in Part 1 appoints the following individual(s) as attorney(s)-in-fact. Complete Page 3 to appoint additional representative(s). All representatives listed on your POA Declaration will have the ability to remove a representative from your POA Declaration.

Primary Representative’s Name (frst name, middle initial, and last name)



City State ZIP Code





City State ZIP Code


8551173

https://ftb.ca.gov

PAGE 2 FTB 3520 PIT (REV 09-2017)

Part 3 – Authorization for All Years or Specifc Years Your POA Declaration Covers

You must select either Yes or No below. Your selection authorizes representatives in Part 2 and Page 3 to contact FTB about your account, receive and inspect your confdential information, represent you in all FTB matters, and request information we receive from the Internal Revenue Service (IRS) for either “all years” or “specifc years” indicated below. If you authorize “all years” and “specifc years,” the specifc years privilege prevails. Enter “NA” (not applicable) or strike through any blank year felds. If you do not select either Yes or No or select both Yes and No, we will process the Authorization as a No. This may cause your POA Declaration to be invalid, and it may be rejected. If you authorized “all years,” this will include previous, current, and future years up to the expiration date. If you authorized “specifc years,” you can designate future years or income periods up to fve years from the POA Declaration signature date.

YES NO

Authorized All Years Multiple Years Begin and End

Or (YYYY) (YYYY)YES NO

Authorized Specifc Years* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

* For example, Single Year: 2018-2018 Year Range: 2015-2017

–

–

–

–

Part 4 – Additional Authorizations

Select either Yes or No below for additional authorizations you would like to grant your representative(s) beyond those described in Part 3. If you do not select either Yes or No or select both Yes and No for any additional authorizations below, we will process the Authorization as a No. For more information, go to ftb.ca.gov/POA.

YES NO

Add representative(s)

YES NO

Authority to sign tax return(s) (only if incapacitated or continuous absence from the U.S.)

YES NO

Receive, but not endorse, refund check(s)

YES NO

Waive the California statute of limitations (SOL)

YES NO

Execute settlement and closing agreements

YES NO

Other acts (describe on Page 4)

Part 5 – Signature Authorizing Power of Attorney Declaration

I am the individual listed in Part 1 or a guardian, legal representative, executor, receiver, administrator, or trustee on behalf of the individual or fduciary, and I certify I have the legal authority to sign this Power of Attorney (POA) Declaration. I understand that submitting this POA Declaration will not revoke any previously submitted POA Declarations with overlapping privileges. FTB will reject this POA Declaration if not signed and dated by an authorized individual. Authorized individuals signing on behalf of the taxpayer must sign as themselves and include supporting documentation.

Print Name Title (required for Fiduciaries)

Signature Date

8552173

x

PAGE 3 FTB 3520 PIT (REV 09-2017)

Individual or Fiduciary Power of Attorney Declaration The individual or fduciary in Part 1 appoints the following additional representative(s) as attorney(s)-in-fact. Include as many copies of this page as needed to list all representatives. Do not return this page if blank.




City State ZIP Code





City State ZIP Code





City State ZIP Code





City State ZIP Code


8553173

PAGE 4 FTB 3520 PIT (REV 09-2017)

Other Acts Authorization(s) Submit this page if you selected Yes to the Other Acts Authorization box from Part 4. If you did not select Yes or selected both Yes and No within Part 4 - Additional Authorizations, Other Acts, we will disregard this page without the listed authorizations being granted. Describe the specifc other acts you authorize your representative(s) in Part 2 and Page 3 to perform before FTB. Authorizations listed in Part 3 and Part 4 prevail over conficting authorizations listed in this section. Do not return this page if blank.

Franchise Tax Board Privacy Notice To learn about your privacy rights, how we may use your information, and consequences if you do not provide information we request, go to ftb.ca.gov/forms and search for 1131. To request this notice by mail, call 800.338.0505 and enter form code 948 when instructed.

Submit your POA Declaration online or by mail.*

Online: Log in to MyFTB and select File a Power of Attorney.

Mail: POA/TIA UNIT FRANCHISE TAX BOARD PO BOX 2828 RANCHO CORDOVA CA 95741-2828

*Paper submissions result in longer processing time frames. Mail this Declaration separately from tax returns or correspondence. Keep a copy of all documents for your records. For more information, go to ftb.ca.gov/POA.

8554173

https://ftb.ca.gov/POA

https://ftb.ca.gov/forms

Fayne, Kaila@DCA

To: DCA, BCC@DCA; Ramil, Melanie@DCA Cc: Blackshire, Ashlynn@DCA Subject: RE: San Diego

Sent: Tuesday, July 17, 2018 4:35 PM From: Chris Buelow

To: DCA, BCC@DCA <[email protected]> Subject: San Diego

I can not make it to the town hall meet on July 19 2018. We NEED a seprate compassionate license. I am a veteran with PTSD and major chronic pain. I am on a fixed income. I deserve the right just as every other human to choose my meds. Why should I and every day normal people go into one of your prop 64 dispensaries and pay crazy amounts of taxes on my medication? What If alcohol was considered medication? And I go into the medical alcohol store to by my medical whiskey 3x cheaper than I would going to a bar. Its medical so its cheaper...and I use it for medical. Why is cannabis any different? We have veterans and normal people who cant afford access to safe alternative medicine. Please please please make changes to this.

Sincerely, Christopher Buelow

Orange county California

1


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