Cannabis Law Alert

After two failed attempts, Governor Ned Lamont signed into law Senate Bill 1201 legalizing the use of cannabis in Connecticut for adults over the age of 21. This law institutes a comprehensive regulatory scheme to control the sale and use of cannabis within Connecticut and leaves local officials with the ability to limit the number and locations of cannabis retailers through zoning ordinances. Below are some of the highlights of Senate Bill 1201.

Possession: Beginning July 1, 2021, adults over the age of 21 in Connecticut will be able to possess up to 1.5 ounces of cannabis on their person and up to 5 ounces in their homes or vehicle glove box.

Retail Sales: The sale, manufacture, and cultivation of cannabis (aside from home grow) will require a license from the State of Connecticut. Non-licensed individuals may gift cannabis to others, but are prohibited from selling it. Non-licensees may not gift cannabis to retailers who buy non-cannabis products or make donations. Products that contain delta-8-THC, delta-9-THC, or delta-10-THC are considered cannabis and may only be sold by licensed retailers.

Home-grow: Beginning on October 1, 2021, participants in Connecticut’s medical marijuana program will be permitted to grow up to six cannabis plants indoors and within their homes. After July 1, 2023, all other adults over the age of 21 will also be able to grow the same number of plants inside their residences.

Prior Penalties: Convictions of a select number of marijuana related offenses that occurred between January 1, 2000 and October 1, 2015 will be automatically erased or expunged. Convictions for these offenses that occurred outside of the prescribed date range may be erased after petitioning.

Community Reinvestment: Senate Bill 1201 reserves at least half of all initial licenses for social equity applicants, specifically targeting applicants from communities that have been disproportionately impacted by the War on Drugs. Additionally, the bill creates the Social Equity Council, a group that will launch programs and support for social equity applicants in the cannabis market. The bill also provides for the creation of a Social Equity and Innovation Fund, which will reallocate portions of the revenue obtained from retail sales of cannabis to communities negatively impacted by harsh marijuana policies. The Social Equity Council will use this fund to provide business capital, workforce education, and technical assistance for business start-ups and operations, as well make investments within local communities. The bill also creates the Prevention and Recovery Services Fund, which will use portions of retail cannabis revenue to support substance misuse prevention, treatment, and recovery services. Connecticut’s health agencies will also launch new programs to prevent and treat those cannabis misuse.

Taxes: The bill’s tax rate structure includes a 3% municipal sales tax to be directed to the town or city where the retail sale occurred, a 6.35% state sales tax, and a tax based on the THC content of the product: 2.75 cents per milligram of THC for cannabis edibles; 0.625 cents per milligram of THC for cannabis flower; and 0.9 cents per milligram of THC for all other product types.

Employment: This bill does not restrict an employer’s ability to enforce a drug-free workplace and allows employers to continue instituting policies prohibiting off-work use of cannabis. However, an employer may not take adverse action against an employee or potential employee for using cannabis prior to applying for or working at such an employer, or if no employment policies prohibit its use. The bill does exempt employers in certain industries, such as manufacturing and healthcare, from provisions of this law.

Product Safety and Advertising: Cannabis products must be lab tested and sold in child-safe packaging. Edible cannabis products must be limited to 5 milligrams or less of THC per serving, and other products will be bound to a potency cap. Additionally, product types that appeal to children are prohibited.  Advertising of cannabis products are not permitted through television, radio, internet, print, and billboards unless the advertiser has reliable evidence that more than 90% of consumers reached by the advertisement are at least 21 years of age or older. Advertising within 500 feet of a school is strictly prohibited.

Public Safety: The bill criminalizes the sale of cannabis products to persons under the age of 21 and prohibits cannabis use in state parks, state beaches, and on state waters.

While possession of cannabis will become legal for adults in Connecticut beginning on July 1, 2021, retail sales of cannabis will not begin until the end of 2022. Businesses can use this time to begin securing licenses to sell, manufacture, and cultivate cannabis within Connecticut. Bressler attorneys have extensive experience in assisting cannabis businesses in regulatory and other legal compliance matters. We look forward to working with clients in Connecticut during this historic change. For more information or assistance, please contact us.

[1] The author thanks law clerk Jeffrey Meehan for his assistance in preparing this client alert.

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