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An Act To Dedicate a Portion of the Tax on the Sale of Marijuana to Substance Abuse Prevention and Treatment, Law Enforcement Costs and Regulatory Oversight
Be it enacted by the People of the State of Maine as follows:
Sec. 1. 5 MRSA §20067, sub-§1-A, as amended by PL 2011, c. 657, Pt. AA, §45, is further amended to read:
 
1-A. Advise the department.   The commission shall advise the department in the development and implementation of significant policy matters relating to substance abuse and make recommendations regarding the disbursement of funds from the Substance Abuse Education, Prevention and Treatment Fund established in section 20068.
Sec. 2.  5 MRSA §20068  is enacted to read:
§ 20068. Substance Abuse Education, Prevention and Treatment Fund
 
1.  Fund established; purposes.     The Substance Abuse Education, Prevention and Treatment Fund, referred to in this section as "the fund," is established for the purpose of providing funding for:
 
A.  Programs for education regarding, prevention of and support and treatment for substance abuse, including the prevention of marijuana use by minors;
 
B.  Regulatory oversight of the retail marijuana industry; and
 
C.  Increased costs to law enforcement agencies and the courts associated with the retail marijuana industry.
 
2.  Administration; source of funding.     The fund is administered by the department. The fund is a dedicated, nonlapsing fund into which payments are received in accordance with Title 36, section 1817, subsection 7, paragraph B; Title 36, section 1818, subsection 3, paragraph B; and Title 36, section 1819, subsection 4, paragraph B.
 
3.  Disbursement of funds.     The department, after considering the recommendations of the commission regarding the use of the fund pursuant to section 20067, shall direct the State Controller to disburse funds for the purposes stated in subsection 1.
 
4.  Report.     The commissioner or the commissioner's designee shall report annually by March 1st to the joint standing committees of the Legislature having jurisdiction over health and human services matters, criminal justice matters and appropriations and financial affairs. The report must include a description of the specific programs or services for which money was provided from the fund, the revenue received into the fund and the amount provided for each program or service. The report must describe any collaborative efforts between the department, the Department of Public Safety and the state licensing authority responsible for regulating and controlling the licensing of the cultivation, manufacture, distribution, testing and sale of retail marijuana and retail marijuana products in this State. The commissioner may submit recommendations for legislation to the joint standing committees of the Legislature having jurisdiction over health and human services matters, criminal justice matters and appropriations and financial affairs, which are authorized to submit legislation related to the report to the Legislature.
Sec. 3. 36 MRSA §1817, sub-§2, as enacted by IB 2015, c. 5, §3, is amended to read:
 
2. Sales tax on retail marijuana and retail marijuana products.  TheNotwithstanding section 1811, the sales tax on retail marijuana and retail marijuana products is 10%15% and is the only tax charged on the sale of retail marijuana and retail marijuana products at the point of final sale at a retail marijuana store or retail marijuana social club.
Sec. 4. 36 MRSA §1817, sub-§7, as enacted by IB 2015, c. 5, §3, is repealed and the following enacted in its place:
 
7.  Application of tax revenues.     All sales tax revenue collected pursuant to this section must be distributed as follows:
 
A.  Ninety-five percent must be deposited in the General Fund. None of the funds deposited in the General Fund pursuant to this paragraph may be used to directly fund any new state programs, except that revenue may be appropriated to the Maine Criminal Justice Academy for the purpose of training law enforcement personnel on retail marijuana and retail marijuana products laws and rules. Funds appropriated to the Maine Criminal Justice Academy pursuant to this paragraph may be used only for the actual costs incurred to provide the necessary education and training of law enforcement personnel; and
 
B.  Five percent must be deposited in the Substance Abuse Education, Prevention and Treatment Fund established in Title 5, section 20068 to be used for substance abuse prevention, treatment and education programs, including programs for persons under 21 years of age, and regulatory oversight of the cultivation, manufacture, sale and distribution of retail marijuana and retail marijuana products.
Sec. 5.  36 MRSA §§1818 and 1819  are enacted to read:
§ 1818. Tax on the sale of medical marijuana
 
1.  Imposition of tax; rate.     A tax is imposed on marijuana sold by a registered nonprofit dispensary or registered primary caregiver to a qualifying patient or registered primary caregiver pursuant to Title 22, chapter 558-C. Notwithstanding section 1811, the rate of the tax is 15%.
 
2.  Exclusive tax.     No other tax may be imposed on the retail sale of marijuana subject to the tax imposed pursuant to subsection 1.
 
3.  Application of tax revenues.     All sales tax revenue collected pursuant to this section must be distributed as follows:
 
A.  Ninety-five percent must be deposited in the General Fund; and
 
B.  Five percent must be deposited in the Substance Abuse Education, Prevention and Treatment Fund established in Title 5, section 20068 to be used for the purposes specified in Title 5, section 20068, subsection 1.
§ 1819. Wholesale tax on marijuana
 
1.  Definitions.     As used in this section, unless the context otherwise indicates, the following terms have the following meanings.
 
A.  "Cannabis" means all parts of the plant of the genus Cannabis whether growing or not, the seeds thereof, the resin extracted from any part of the plant and every compound, manufacture, salt, derivative, mixture or preparation of the plant, its seeds or its resin including cannabis concentrate. "Cannabis" does not include industrial hemp, fiber produced from the stalks, oil, cake made from the seeds of the plant, sterilized seed of the plant that is incapable of germination or any ingredient combined with cannabis to prepare topical or oral administrations, food, drink or any other product. "Cannabis" also means marijuana.
 
B.  "Edible retail marijuana product" means any retail marijuana product that is intended to be consumed orally, including, but not limited to, any type of food, drink or pill.
 
C.  "Marijuana" means cannabis.
 
D.  "Retail marijuana cultivation facility" means an entity licensed to cultivate, prepare and package retail marijuana and sell retail marijuana to retail marijuana establishments and retail marijuana social clubs under Title 7, chapter 417.
 
E.  "Retail marijuana establishment" means a retail marijuana store, a retail marijuana cultivation facility, a retail marijuana products manufacturing facility or a retail marijuana testing facility as defined in Title 7, section 2442.
 
F.  "Retail marijuana product" means concentrated retail marijuana and retail marijuana products that are composed of retail marijuana and other ingredients and are intended for use or consumption, including, but not limited to, edible retail marijuana products, ointments and tinctures.
 
G.  "Retail marijuana social club" means an entity licensed to sell retail marijuana and retail marijuana products to consumers for consumption on the licensed premises under Title 7, chapter 417.
 
H.  "Retail marijuana store" means an entity licensed to purchase retail marijuana from a retail marijuana cultivation facility and to purchase retail marijuana products from a retail marijuana products manufacturing facility and to sell retail marijuana and retail marijuana products to consumers under Title 7, chapter 417.
 
2.  Rate of tax.     A tax is imposed on the wholesale sale of marijuana and retail marijuana products under Title 7, chapter 417 at the rate of 3%.
 
3.  Imposition.     A tax is imposed at the time marijuana or retail marijuana products are sold to a retail marijuana store or retail marijuana social club by a retail marijuana cultivation facility or retail marijuana products manufacturing facility for resale by the retail marijuana store or retail marijuana social club. The tax imposed pursuant to this section is a tax on the retail marijuana store or retail marijuana social club.
 
4.  Application of tax revenues.     All tax revenue collected pursuant to this section must be distributed as follows:
 
A.  Ninety-five percent must be deposited in the General Fund; and
 
B.  Five percent must be deposited in the Substance Abuse Education, Prevention and Treatment Fund established in Title 5, section 20068 to be used for the purposes specified in Title 5, section 20068, subsection 1.
Sec. 6. Effective date. This Act takes effect February 1, 2018.
 
SUMMARY
This bill establishes the Substance Abuse Education, Prevention and Treatment Fund to provide funding for:
1. Programs for education regarding prevention of and support and treatment for substance abuse, including the prevention of marijuana use by minors;
2. Regulatory oversight of the retail marijuana industry; and
3. Increased costs to law enforcement agencies and the courts associated with the retail marijuana industry.
The fund is administered by the Department of Health and Human Services and disbursed based on the recommendations of the Substance Abuse Services Commission.
The fund is funded by an increase in the tax imposed on the retail sale of marijuana and marijuana products from 10% to 15%, an increase on the tax imposed on medical marijuana from 5.5% to 15% and a wholesale tax imposed on the sale of marijuana and marijuana products for retail sale of 3%. Five percent of the revenue from these taxes is deposited in the Substance Abuse Education, Prevention and Treatment Fund; the balance is deposited in the General Fund.