SSCR1816

STAND. COM. REP. NO. 1816

Honolulu, Hawaii

RE: H.B. No. 302

H.D. 2

S.D. 2

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Sir:

Your Committees on Judiciary and Ways and Means, to which was referred H.B. No. 302, H.D. 2, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO CANNABIS,"

beg leave to report as follows:

The purpose and intent of this measure is to:

(1) Amend the definition of "debilitating medical condition" under the Uniform Controlled Substances Act;

(2) Amend the definition of "waiting room" under the Medical Cannabis Dispensary System law;

(3) Repeal the requirement that a provider-patient relationship be established in person;

(4) Allow dispensaries to purchase cannabis and manufactured cannabis products from another dispensary for direct retail sale to a patient and further manufacturing by the purchasing dispensaries and establishes requirements for transport;

(5) Prohibit persons from operating a medical cannabis dispensary or cultivating cannabis without a license from the Department of Health or providing certain services to persons or entities engaging in unlicensed cannabis operations;

(6) Require the Department of Health to issue a cease and desist notice to violators before initiating criminal proceedings;

(7) Establish criminal penalties;

(8) Establish an affirmative defense for, and a conclusive basis for, certain violations;

(9) Establish a cannabis cultivator license to authorize the cultivation and distribution of cannabis plants;

(10) Require the Department of Health to only issue one cannabis cultivator license for each person;

(11) Establish limits on:

(A) The number of cannabis cultivator licenses the Department of Health may issue;

(B) The maximum size of plant canopy for indoor and outdoor cultivations for each cannabis cultivator license; and

(12) Authorize expenditures from the Medical Cannabis Registry and Regulation Special Fund to fund programs for the mitigation and abatement of nuisances relating to chapter 329D, Hawaii Revised Statutes (HRS); and

(13) Appropriate funds out of the Medical Cannabis Registry and Regulation Special Fund for the Department of Attorney General to enforce, and mitigate nuisances relating to, chapter 329D, HRS.

Your Committees received testimony in support of this measure from the Hawaiʻi Cannabis Industry Association, Aloha Green Apothecary, Marijuana Policy Project, Cure Oahu, Big Island Grown Dispensaries, Hawaiʻi Alliance for Cannabis Reform, Drug Policy Forum of Hawaii, ACLU of Hawaiʻi, and one individual.

Your Committees received testimony in opposition to this measure from the Oahu Cannabis Farms Alliance.

Your Committees received comments on this measure from the Department of the Attorney General, Department of Health, Akamai Cannabis Consulting, and one individual.

Your Committees find that the State's medical dispensary program is suffering from regulatory barriers that make operations difficult to sustain while facing increasing threats of competition from the unregulated market, including street sales and the proliferation of unregulated, high-potency THC cannabis, sold under the guise of being hemp, currently available at retailers across the State. This measure will lower the barrier to entry for patients to access the legal dispensary system while maintaining quality standards for licensees to ensure access to clean and tested cannabis.

Your Committees note that this measure, as written, establishes a criminal offense for unlicensed operation of a dispensary; however, the required state of mind is not clearly stated, and therefore amendments to this measure are necessary.

Accordingly, your Committees have amended this measure by:

(1) Clarifying that the state of mind requirement for the offense of operating a dispensary without a license from the Department of Health pursuant to chapter 329D, HRS, is intentionally, knowingly, or recklessly;

(2) Specifying that a person who intentionally, knowingly, or recklessly operates any search platform, web hosting service, social media platform, or other entity that posts information advertising the sale of cannabis products by an unlicensed person or entity engaged in the production, manufacture, or sale of cannabis or manufactured cannabis products without a license pursuant to chapter 329D, HRS, is guilty of a misdemeanor;

(3) Specifying that a person issued a cannabis cultivator license is required to meet all production facility and processing requirements under chapter 329D, HRS;

(4) Inserting language specifying that the Department of the Attorney General's Drug Nuisance Abatement Unit may enforce nuisances relating to chapter 329D, HRS;

(5) Specifying that the appropriation for the Department of the Attorney General to enforce, and mitigate nuisances relating to, chapter 329D, HRS, shall be expended by the Attorney General;

(6) Inserting an effective date of January 1, 2027, for the requirement of cannabis cultivator licenses; and

(7) Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

As affirmed by the records of votes of the members of your Committees on Judiciary and Ways and Means that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 302, H.D. 2, S.D. 1, as amended herein, and recommend that it pass Third Reading in the form attached hereto as H.B. No. 302, H.D. 2, S.D. 2.

Respectfully submitted on behalf of the members of the Committees on Judiciary and Ways and Means,

________________________________

DONOVAN M. DELA CRUZ, Chair

________________________________

KARL RHOADS, Chair