Bill > AB1061

Introduced Session

CANNABIS LEGALIZATION AND REGULATION Under this bill, a person who is at least 21 years old may legally possess cannabis for recreational purposes, and a person who is at least 21 years old may legally purchase intoxicating hemp products. A person who is at least 18 years old, or a person who is a minor if their parent, guardian, or legal custodian consents, may possess cannabis for medical purposes. Under the bill, a person may produce, process, or sell cannabis if the person has a license. The bill does not affect federal law, which generally prohibits persons from manufacturing, delivering, or possessing marijuana and applies to both intrastate and interstate violations. Intoxicating hemp products Under current law, there is no age restriction on activities related to hemp. The bill restricts access to intoxicating hemp products to individuals age 21 or older. Under the bill, an “intoxicating hemp product” is a hemp product, either in the form of an edible item or a beverage, that contains intoxicating cannabinoids at a concentration level of 1.0 to 10.0 milligrams (mg) per 12 fluid ounces of beverage or per serving or per package of edible. Any hemp product that has a higher concentration of cannabinoids or that is in any other format is regulated as cannabis. Under the bill, a law enforcement officer may seize hemp product that is sold to or in the possession of an individual under age 21. Additionally, no person may sell any intoxicating hemp product to a person under age 21 or purchase such a product on behalf of a person who is under age 21. Under the bill, the penalties for such a violation vary depending on whether the person has committed a previous violation and range from a civil forfeiture of up to $500, if the person has no previous violations, to a fine of up to $10,000 and imprisonment for up to nine months or both, if the person has committed three or more violations in the preceding 30 months. Under current law, the penalty for violating hemp producer regulations is a forfeiture of not less than $200 nor more than $5,000 or, for a subsequent offense committed within five years, a forfeiture of not less than $400 nor more than $10,000. Under the bill, that penalty applies to certain violations regarding the sale of intoxicating hemp products generally. Under federal law, beginning on November 12, 2026, the federal definition of what constitutes “hemp” will change, and certain products that are considered legal hemp under current federal and state law will no longer be considered hemp. On the day that the federal provisions take effect, the hemp provisions in this bill are repealed and new provisions relating to low-dose cannabis-infused products take effect. Legalizing the possession of cannabis 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. The bill changes state law to allow a person who is at least 21 years old to possess usable cannabis in any of the following forms and quantities: 1) up to 2.5 ounces of cannabis flower in a public place; 2) up to five pounds of cannabis flower in their private residence; 3) up to one gram of tetrahydrocannabinol in a cannabis- infused product; and 4) up to 15 grams of cannabis concentrate. The bill also allows a qualifying patient to possess cannabis for medical purposes. Under the bill, a “qualifying patient” is an individual at least 18 years of age, with certain exceptions, who has been diagnosed with or is undergoing treatment for a debilitating disease or treatment. The bill also eliminates the prohibition on possessing or using drug paraphernalia that relates to cannabis consumption. Penalties for violating the laws relating to possession, distribution, and sale without a license vary widely depending on the severity of the violation, the age of the violator, and the quantity of cannabis involved in the violation. Generally, for low-level violations, the penalty is a forfeiture of up to $250, and penalties increase in severity to a Class I felony. Regulating the production, processing, transportation, and sale of cannabis The bill creates the Division of Cannabis Regulation within the Department of Agriculture, Trade and Consumer Protection (“division”) to oversee the production, processing, transportation, and testing of cannabis. The bill requires, with certain exceptions, a person to obtain a license from the division to produce, process, or possess with the intent to sell cannabis or to operate a cannabis microbusiness. The bill also requires a person to obtain a license from the Department of Revenue to sell cannabis at a cannabis dispensary or to operate a cannabis lounge, and requires cannabis microbusinesses to complete a two-part application that begins with submitting an application for a conditional license to the division, which must then be approved by DOR. The requirements for obtaining any license relating to cannabis are the same whether it is issued by the division or DOR. In general, an applicant for any cannabis license must be at least 10 years past the completion of any sentence for a violent crime; must be at least 21 years of age; must not have a financial interest in any other cannabis licensee or licensee applicant; must have been a resident of this state for at least the 90 continuous days before the application date; must submit to an inspection of their premises; must demonstrate sufficient security features in place at the premises; and must include with their application a detailed description of the premises to be licensed. A person who holds a cannabis license must also comply with certain operational requirements. In general, licenses to produce and process cannabis are mutually exclusive with licenses to sell cannabis, except in the case of a cannabis microbusiness, and no person licensed to produce, process, or sell cannabis may be licensed if they have any financial interest in a cannabis testing laboratory. To obtain any license relating to cannabis, either from the division or from DOR, an applicant must pay an application fee of $250 plus the cost of any required background investigation, then an annual license fee of $3,000. The bill permits a city, village, town, or county to enact an ordinance prohibiting the operation of a licensed cannabis microbusiness, cannabis dispensary, or cannabis lounge within the city, village, town, or county. Cannabis producer licenses Under the bill, a licensed cannabis producer may plant, grow, cultivate, and harvest cannabis; transfer or sell cannabis to a licensed cannabis processor or a licensed cannabis testing laboratory; and engage in any related activities that are necessary for the operation, such as possessing and storing cannabis. Under the bill, a cannabis producer may operate a premises with a “canopy,” which is the space for producing mature cannabis plants (as opposed to the space for propagating plants or starting seedlings), of up to 50,000 square feet. Cannabis processor licenses Under the bill, a licensed cannabis processor may obtain cannabis from a licensed cannabis producer or cannabis microbusiness; process cannabis into usable cannabis; package and label usable cannabis products; sell usable cannabis to licensed cannabis retailers or cannabis microbusinesses; and engage in any related activities that are necessary for the operation, such as possessing and storing cannabis. In addition, the bill provides that a licensed cannabis processor must package the usable cannabis in child-resistant packaging and attach a label to the packaging that includes certain information. Furthermore, the bill provides that no cannabis processor or cannabis microbusiness may make usable cannabis from cannabis that was grown outside the state. Cannabis retailer licenses Under the bill, a licensed cannabis retailer may operate a cannabis dispensary and, if they apply for an additional license, a cannabis lounge. A cannabis retailer may obtain packaged and labeled usable cannabis from licensed cannabis processors. A cannabis retailer operating a cannabis dispensary may sell usable cannabis and paraphernalia intended for the storage or use of usable cannabis to consumers, as well as other items related to the cannabis business. A cannabis retailer operating a cannabis lounge may not sell usable cannabis or paraphernalia intended for the storage or use of usable cannabis, but may sell other items related to the cannabis business. Cannabis microbusiness licenses Under the bill, a licensed microbusiness is a cannabis producer that may also act as a cannabis processor, cannabis retailer, or both, all on a single premises, if the cannabis microbusiness operates within a single “canopy,” which is the space for producing mature cannabis plants (as opposed to the space for propagating plants or starting seedlings), of not more than 20,000 square feet. To be licensed as a cannabis microbusiness, an applicant must first apply to the division and indicate which regulated activities the applicant intends to engage in, and then the division must forward the application to DOR for final approval. Regulating the transportation of cannabis The bill requires the division to register cannabis transporters. To be registered as a cannabis transporter, an applicant must already be licensed as a cannabis producer, cannabis processor, cannabis microbusiness, or cannabis retailer; must complete a cannabis transportation course that has been approved by the division; and must pay a $5 registration fee. A registered cannabis transporter may transport cannabis between the premises of any cannabis licensees or between a cannabis licensee and a cannabis testing laboratory. Regulating the testing of cannabis The bill requires the division to license entities as cannabis testing laboratories. To be licensed as a cannabis testing laboratory, an entity must meet the same criteria as any other cannabis licensee. Cannabis testing laboratories certify whether cannabis and usable cannabis comply with DATCP standards regarding potency and the presence and levels of mold, fungus, pesticides, and other contaminants. Cannabis testing laboratories must destroy any samples remaining after certification testing. Regulating the packaging and labeling of cannabis The bill requires that licensed cannabis processors and cannabis microbusinesses operating as cannabis processors must package usable cannabis in child-resistant packaging and attach a label to the packaging that includes all of the following information: 1. A complete list of the ingredients in the usable cannabis product. 2. The type and the amount of any cannabinoid contained in the usable cannabis or the THC concentration in the usable cannabis. 3. The cannabis producer’s or cannabis microbusiness’s business or trade name. 4. The cannabis producer’s or cannabis microbusiness’s license number. 5. The lot number of the cannabis. 6. The harvest date. 7. The manufacture date. 8. The strain name and product identity. 9. The net weight or volume. 10. The activation time. 11. The name of the cannabis testing laboratory that tested the cannabis, the test batch number, and the test analysis dates. 12. A logo for recreational cannabis that DATCP is required to develop. 13. A warning about the risks of cannabis use and pregnancy. 14. A warning about the risks of cannabis use by persons under the age of 18. The bill requires both cannabis-infused beverages and cannabis-infused edible products to indicate on the label the portion that constitutes one serving of the beverage or edible product. Additionally, cannabis-infused beverages are prohibited from containing more than 20 mg of THC per serving or more than 200 mg of THC per package. Cannabis-infused edibles are prohibited from containing more than 20 mg of THC per serving and must be packaged as either single pieces or as clear and easily separable one-unit portions of a larger piece. Medical cannabis registry program The bill requires the Department of Health Services to establish a Medical Cannabis Registry Program, and a person or his or her caregiver may apply to DHS for a registry identification card. The bill specifies that the following medical conditions or treatments qualify a person for the registry: cancer, glaucoma, AIDS or HIV, Crohn’s disease, a hepatitis C virus infection, Alzheimer’s disease, amyotrophic lateral sclerosis, nail-patella syndrome, Ehlers-Danlos syndrome, post-traumatic stress disorder, or the treatment of any of these conditions; opioid abatement or reduction or treatment for opioid addiction; a chronic or debilitating disease or medical condition or the treatment of such a disease or condition that causes cachexia, severe pain, severe nausea, seizures, or severe and persistent muscle spasms; and any other medical condition or treatment DHS designates by rule as a debilitating medical condition or treatment. DHS must issue a qualified applicant a registry identification card. DHS must keep registry information and applications confidential except for verifying the status of a registrant for law enforcement purposes. Under the bill, a health care practitioner may not provide a written certification to obtain a registry identification card for himself or herself or any family member, and health care practitioners who provide written certifications for registry identification cards may not have any financial interest connected to a person or entity that produces, processes, transports, tests, or sells cannabis. The bill imposes registration fees for individuals and caregivers who apply for a registry identification card, as well as an annual fee for caregivers in possession of a registry identification card. These fees are used to administer the medical cannabis registry program. Cannabis taxation The bill imposes the following taxes on the sale of cannabis in this state at various stages: 1. An excise tax at the rate of 10 percent of the sales price imposed on the cannabis producer for each wholesale sale of cannabis from a cannabis producer to a cannabis processor. 2. An excise tax at the rate of 10 percent of the sales price imposed on the cannabis processor on each wholesale sale or transfer of cannabis from a cannabis processor to a cannabis retailer or a cannabis microbusiness. 3. An excise tax at the rate of 5 percent of the sales price imposed on the cannabis retailer on each retail sale of usable cannabis by a cannabis retailer, except that the tax does not apply to sales of usable cannabis by a cannabis dispensary to an individual who holds a valid medical cannabis registry identification card. 4. An occupational tax that is imposed on a cannabis microbusiness at the rate of 10 percent of the gross receipts of the cannabis microbusiness. 5. An excise tax that a municipality may, by ordinance, impose at a rate not exceeding 5 percent of the sales price on each retail sale in the municipality of usable cannabis made by a cannabis retailer, except that the tax does not apply to sales of usable cannabis by a cannabis dispensary to an individual who holds a valid medical cannabis registry identification card. 6. In addition to the other taxes imposed on the retail sale of usable cannabis, an excise tax at the rate of 3 percent of the sales price on each retail sale of cannabis flower, except that the tax does not apply to sales of usable cannabis by a cannabis dispensary to an individual who holds a valid medical cannabis registry identification card. The revenue collected from the tax on cannabis flower is deposited into a segregated fund, designated the Cannabis Research Fund, to be used by the Department of Health Services to research the effect of cannabis consumption on public health. Low-dose cannabis-infused products The bill creates a special category of cannabis product called a “low-dose cannabis-infused product,” which is defined as a cannabis-infused product, either in the form of an edible item or a beverage, that contains a tetrahydrocannabinol concentration level of 1.0 to 10.0 mg per 12 fluid ounces of beverage or per serving or per package of edible. In the bill, low-dose cannabis-infused products replace intoxicating hemp products when provisions regulating intoxicating hemp products are repealed, in accordance with a change to federal law. Under the bill, when the provisions relating to low-dose cannabis-infused products take effect, the products are subject to the same production, processing, packaging, and testing requirements as other cannabis products, and are subject to the same age restrictions on sales. The key difference is that a low-dose cannabis-infused product may be sold at any retailer, not just at a dispensary. An excise tax at the rate of 5 percent of the sales price is imposed on the retailer on each retail sale of low-dose cannabis-infused products, except that the tax does not apply to sales of the products by a cannabis dispensary to an individual who holds a valid medical cannabis registry identification card. Previous convictions for cannabis-related or marijuana-related crimes The bill creates a process to review convictions for acts that have been decriminalized under the bill. If the person is currently serving a sentence or on probation for such a conviction, the person may petition a court to vacate the conviction and expunge the record or, if applicable, adjust the conviction to a lower crime. If the person has completed a sentence or period of probation for such a conviction, the person may petition a court to vacate the conviction and expunge the record or, if applicable, adjust the record of conviction to a lower crime. Any conviction that is expunged under the bill is not considered a conviction for any purpose under state or federal law. This bill also creates within the Department of Administration a Cannabis Conviction Review Unit that must, in consultation with the Department of Corrections and Department of Justice, seek to identify individuals with prior criminal convictions related to cannabis or marijuana that may be eligible for expungement or adjustment and notify those individuals of their eligibility, and to advise those individuals and the general pubic about eligibility and procedures for cannabis conviction review. The review unit is also required to award grants to organizations that provide related services. Under the bill, the cannabis conviction review unit sunsets 10 years after the bill takes effect. Discrimination and employment The bill prohibits discrimination in employment and licensing against individuals based on their use or possession of medical cannabis off the employer’s premises during nonworking hours, unless one of certain exceptions applies. The bill also prohibits discrimination in housing based upon an individual having a medical cannabis registry identification card or certification. The bill provides that an employee who is terminated solely due to a positive drug test for cannabis components or metabolites or who violates the employer’s policy concerning the use of cannabis is not disqualified from receiving unemployment insurance or worker’s compensation benefits unless 1) the employee uses or possesses medical cannabis on the employer’s premises or during working hours or 2) the use impairs the individual’s ability to adequately undertake the job- related responsibilities of that individual’s employment. Funding and position authorizations The bill also provides the following funding and position authorizations to administer cannabis regulations: 1. To DOA, $5,000,000 in each year of the fiscal biennium for cannabis conviction conviction review, $1,000,000 in each year of the fiscal biennium for cannabis conviction review grants, and nine full-time positions for the Cannabis Conviction Review Unit. 2. To DATCP, $30,000,000 in each year of the fiscal biennium and 180 full- time positions for cannabis licensing and regulation administration. 3. To DHS, $5,000,000 in the 2025-26 fiscal year, $4,000,000 in the 2026-27 fiscal year, and 26 full-time positions for the Medical Cannabis Registry Program and the Cannabis Research Program. 4. To DOR, $2,701,300 in the 2025-26 fiscal year, $1,985,800 in the 2026-27 fiscal year, eight full-time project positions, which expire two years after the bill becomes law, and 18 full-time positions for cannabis licensing and taxation. 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.

AI Summary

Committee Categories

Clint Anderson (D)*,  Deb Andraca (D)*,  Margaret Arney (D)*,  Mike Bare (D)*,  Brienne Brown (D)*,  Ryan Clancy (D)*,  Angelina Cruz (D)*,  Karen DeSanto (D)*,  Ben DeSmidt (D)*,  Kalan Haywood (D)*,  Francesca Hong (D)*,  Andrew Hysell (D)*,  Alex Joers (D)*,  Tara Johnson (D)*,  Karen Kirsch (D)*,  Darrin Madison (D)*,  Renuka Mayadev (D)*,  Maureen McCarville (D)*,  Vincent Miresse (D)*,  Supreme Moore Omokunde (D)*,  Lori Palmeri (D)*,  Christian Phelps (D)*,  Pricilla Prado (D)*,  Amaad Rivera-Wagner (D)*,  Ann Roe (D)*,  Christine Sinicki (D)*,  Lee Snodgrass (D)*,  Ryan Spaude (D)*,  Angela Stroud (D)*,  Shelia Stubbs (D)*,  Sequanna Taylor (D)*,  Angelito Tenorio (D)*,  Randy Udell (D)*,  Tim Carpenter (D),  Kristin Dassler-Alfheim (D),  Dora Drake (D),  Jodi Habush Sinykin (D),  Dianne Hesselbein (D),  LaTonya Johnson (D),  Sarah Keyeski (D),  Chris Larson (D),  Brad Pfaff (D),  Melissa Ratcliff (D),  Kelda Roys (D),  Jeff Smith (D),  Mark Spreitzer (D),  Jamie Wall (D), 

Read first time and referred to Committee on State Affairs (on 02/26/2026)

Official Document