RELATING TO CANNABIS.

SB2421

THE SENATE

S.B. NO.

2421

THIRTY-THIRD LEGISLATURE, 2026

STATE OF HAWAII

A BILL FOR AN ACT

RELATING
TO CANNABIS
.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

PART I

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SECTION 1.
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The legislature finds that cannabis, also
known as marijuana, is a plant with psychoactive properties derived primarily
from its main psychoactive component tetrahydrocannabinol (THC).
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In the United States, the regulation of the
cannabis plant falls into three primary categories:
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(1) cannabis for medical use, (2) cannabis
for non‑medical adult use, and (3) hemp that contains low levels of THC.

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Recognizing the diverse beneficial
applications of cannabis, particularly in medicinal use and pain management,
many states have enacted laws legalizing and regulating medical use
cannabis.
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In Hawaii, chapter 329D, Hawaii
Revised Statutes, establishes the operational guidelines for medical cannabis
dispensaries in the State and creates a safe harbor from state criminal
prosecution relating to medical use cannabis.

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In addition to legalizing medical
use cannabis, numerous states and jurisdictions, including Hawaii, have opted
to decriminalize the possession of small amounts of non-medical use
cannabis.
�
These decisions are motivated
by a variety of compelling reasons, including the prioritization of more
serious crimes, advancements in criminal justice reform, evolving public
opinion, and long-standing social equity concerns within the context of
cannabis regulation.

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Moreover, an increasing number of
states have legalized and initiated the regulation and taxation of the
cultivation, processing, and sale of non-medical use cannabis to adults aged
twenty-one years and older.
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Many states
have witnessed substantial benefits from the revenue generated through taxes,
including use and licensing fees, as well as general excise and sales taxes on
the non-medical adult-use cannabis industry.

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Recognizing these developments in
other jurisdictions, pursuant to Act 169, Session Laws of Hawaii 2021, the
department of health office of medical cannabis control and regulation convened
a task force to explore the development of a dual-system program for cannabis
legalization.
�
This task force issued
findings and recommendations for future regulation, covering aspects such as
taxation, social equity, market structure, medical use, and public health and
safety.

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In light of the task force report,
the legislature finds that the legalization of cannabis for personal use is a
natural, logical, and reasonable outgrowth of the current science of and
attitude toward cannabis.
�
The
legislature further finds that cannabis cultivation and sales hold the
potential for economic development, increased tax revenues, and reduction in
crime.
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Accordingly, the legislature is
prepared to move forward with the legalization of non-medical adult-use
cannabis if specific changes are made at the federal level or if the electorate
approves a state constitutional amendment to legalize cannabis.

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In addition, with the enactment of
the Agriculture Improvement Act of 2018 (P.L. 115-334), also known as the 2018
Farm Bill, the United States Congress removed hemp (cannabis with no more than
0.3 per cent delta-9-THC by weight) from schedule I of the federal Controlled
Substances Act, paving the way for hemp-derived products and the industrial use
of hemp.
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In response, the legislature
enacted Act 263, Session Laws of Hawaii 2023, to reform hemp industry
regulations and acknowledge that hemp is a high-value crop with the potential
to generate significant and diverse revenues for Hawaii.

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In alignment with the federal
recognition of hemp as a valuable crop with tens of thousands of uses,
including for food, fiber, fuel, and remediating soil and capturing carbon, the
legislature acknowledges that hemp provides numerous opportunities for diversifying
Hawaii's agriculture and rural economic development while furthering Hawaii's
food security, energy independence, and sustainability goals.
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The vision of many of Hawaii's founding hemp
farmers was to integrate hemp and food crops so that the higher margins of
high-quality craft hemp products might offset the costs of food production,
potentially creating greater financial stability for Hawaii's family farms and
supporting greater food security.
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Given
the significant potential for hemp, the legislature intends to support hemp
farming by establishing a grant program to provide technical assistance and
offset the impact to the hemp industry by this Act.

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The legislature further finds that,
while hemp holds considerable value for Hawaii's economy and local farmers,
certain concerns have surfaced regarding the regulation and enforcement of
hemp-derived products that have been processed with the intent to surpass legal
THC limits.
�
These items not only
contravene the established medical cannabis framework by surpassing permissible
THC levels at dispensaries, but have also been marketed toward minors, causing
at least one documented case of illness in children who consumed the
hemp-derived products.
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Regulating these
products is crucial for the State to uphold public health and safety.

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The issues posed by hemp-derived
products, coupled with the growing pains observed in sister states relating to
non-medical adult-use cannabis, underscore the necessity to establish uniform
regulations for the entire cannabis plant, including hemp.
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This approach has emerged as the best
practice in the legalization of adult-use cannabis.

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This legislative effort has six main
pillars:
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(1) the enactment of the Hawaii
Cannabis Law � a legal safe harbor from state criminal prosecution concerning
activities relating to cannabis for those who strictly comply with its
provisions; (2) the creation of a robust, independent body � the Hawaii
cannabis and hemp office � with the power to regulate all aspects of the
cannabis plant (whether medical use cannabis, non-medical adult-use cannabis,
or hemp) in accordance with the Hawaii Cannabis Law; (3) the continuing role of
law enforcement agencies in addressing illegal cannabis operations not acting
in accordance with the Hawaii Cannabis Law, which pose threats to public order,
public health, and business operators who choose to operate in the legal market;
(4) a vibrant, well-funded social equity grant program to be implemented by the
Hawaii cannabis and hemp office with the intent to bring greater economic
opportunity to disadvantaged regions of the State and help transition formerly
illicit operators into the legal market; (5) a framework for the legalized sale
and possession of cannabis for personal adult use, which will only be effective
upon specific changes at the federal level or a state constitutional amendment;
and (6) the implementation of extensive, well-funded public health protections,
including a public health and education campaign to inform the public about the
new laws, the continuing risks to public health � especially to children �
posed by cannabis, and financial assistance for public health services, such as
addiction and substance abuse treatment.

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Accordingly, the purpose of this Act
is to:

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(1)
�
Enact the Hawaii
Cannabis Law to:

���������
(A)
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Provide a legal
safe harbor from state or county criminal prosecution concerning activities
relating to cannabis for those who strictly comply with the provisions of the
law;

���������
(B)
�
Establish the
Hawaii cannabis and hemp office as an independent body with the power to
administratively regulate all aspects of the cannabis plant;

���������
(C)
�
Establish
a framework for the legalized
sale
and possession of cannabis for personal adult use, which will only be effective
upon specific changes at the federal level or a state constitutional amendment
;

���������
(D)
�
Provide economic
opportunities to disproportionately impacted areas;

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(E)
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Encourage those
currently engaging in illegal, unlicensed commercial cannabis activities to
enter the legal market;

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(F)
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Ensure that state
and county law enforcement agencies work closely with the Hawaii cannabis and
hemp office and vigorously investigate and prosecute illegal cannabis
activities that fall outside any safe harbor protection; and

���������
(G)
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Mandate that the
Hawaii cannabis and hemp office make the protection of public health and safety
its highest priorities;

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(2)
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Establish taxes on
the sale of cannabis and require every business engaged in the sale of cannabis
to obtain a cannabis tax permit;

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(3)
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Add new traffic
offenses relating to the consumption or possession of marijuana or marijuana
concentrate;

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(4)
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Decriminalize
certain drug offenses related to marijuana and marijuana concentrate if cannabis
for personal adult use is legalized;

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(5)
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Transfer the
personnel and assets of the department of health and assets of the department
of agriculture relating to cannabis and hemp to the Hawaii cannabis and hemp
office;

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(6)
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Establish various
positions within state entities and appropriate funds to implement this Act;
and

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(7)
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Make other
conforming and housekeeping amendments.

PART II

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SECTION 2.
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The Hawaii Revised Statutes is amended by
adding a new chapter to be appropriately designated and to read as follows:

"
CHAPTER
A

HAWAII CANNABIS
LAW

PART
I.
�
GENERAL PROVISIONS

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�A-1
�
Title.
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This chapter shall be known and may be cited as the Hawaii Cannabis Law.

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�A-2
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Purpose and intent.
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The purpose and intent of this chapter is to:

����
(1)
�
Provide a legal
safe harbor from state or county criminal prosecution concerning activities
relating to cannabis for those who strictly comply with the provisions of this
chapter;

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(2)
�
Establish the
Hawaii cannabis and hemp office as an independent body with the power to
administratively regulate all aspects of the cannabis plant in accordance with
this chapter;

����
(3)
�
Establish a framework for
the legalized sale and possession of cannabis for personal adult use, which
will only be effective upon specific changes at the federal level or a state
constitutional amendment
;

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(4)
�
Provide economic
opportunities to disproportionately impacted areas;

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(5)
�
Encourage those
engaging in illegal, unlicensed commercial cannabis activities before the
enactment of this chapter to enter the legal market;

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(6)
�
Ensure that state
and county law enforcement agencies work closely with the Hawaii cannabis and
hemp office and vigorously investigate and prosecute illegal cannabis
activities that fall outside of safe harbor protection; and

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(7)
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Mandate that the
Hawaii cannabis and hemp office make the protection of public health and safety
its highest priorities.

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�A-3
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Definitions.
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As used in this chapter, unless the context
otherwise requires:

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"Adequate supply" means an
amount of cannabis, including medical cannabis, jointly possessed between the
medical cannabis patient and the patient's caregiver that is no more than is
reasonably necessary to ensure the uninterrupted availability of cannabis for
the purpose of alleviating the symptoms or effects of a medical cannabis
patient's debilitating medical condition; provided that an adequate supply
shall not exceed four ounces of cannabis at any given time.
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For purposes of this definition, the ounces
of cannabis shall include any combination of cannabis flower and cannabis
products, with the cannabis in the cannabis products being calculated using
information provided pursuant to section A-113(d).

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"Administrator" means the
administrator of the office established pursuant to section A-11.

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"Adult-use cannabis" means
cannabis that may be legally possessed or consumed by a person who is at least
twenty-one years of age pursuant to this chapter.
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"Adult-use cannabis" includes
adult-use cannabis products.
�

"Adult-use cannabis" does not include medical cannabis.

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"Adult-use cannabis
product" means any product containing or derived from cannabis, including
an edible cannabis product, and cannabis concentrate, that may be legally
possessed or consumed by a person who is at least twenty-one years of age.
�
"Adult-use cannabis product" does
not include medical cannabis products.

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"Advertise",
"advertisement", or "advertising" means any public
communication in any medium that offers or solicits a commercial transaction
involving the delivery, purchase, or sale of cannabis.

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"Advisory board" means the advisory
board on medical and adult-use cannabis established under section A-26.

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"Applicant" means a person
that has submitted an application for licensure, permit, or registration, or
for renewal of licensure, permit, or registration pursuant to this chapter,
that was received by the office for review but has not been approved or denied
by the office.
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If the context requires,
"applicant" includes a person seeking to assume an ownership interest
in a licensed business, a new proposed officer, director, manager, or general
partner of the licensed business, or anyone who seeks to assume any power to
directly or indirectly control the management, policies, and practices of a
licensed business under the license transfer, reorganization, or restructuring
application process pursuant to section A-77.

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"Bona fide physician-patient
relationship" or "bona fide advanced practice registered
nurse-patient relationship" means a relationship in which the physician or
advanced practice registered nurse, respectively, has an ongoing responsibility
for the assessment, care, and treatment of a patient's medical condition.

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"Business entity" means an
association, a corporation, a limited liability company, a partnership, or
other legal entity, whether for profit or nonprofit, incorporated or otherwise
formed or organized by law.

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"Cannabinoid" means any of
the various naturally occurring, biologically active, chemical constituents of
the plant of the genus Cannabis that bind to or interact with receptors of the
endogenous cannabinoid system.

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"Cannabis" has the same
meaning as "marijuana" and "marijuana concentrate" as
provided in sections 329-1 and 712-1240; provided that for the purposes of this
chapter "cannabis":

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(1)
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Includes:

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(A)
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Cannabis flower
and cannabis products;

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(B)
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Medical cannabis;
and

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(C)
�
Adult-use
cannabis; and

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(2)
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Does not include:

���������
(A)
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Hemp that is
cultivated by a licensed hemp cultivator pursuant to section A-132;

���������
(B)
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Hemp that is
processed by a licensed hemp extract processor pursuant to section A-133; and

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(C)
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Hemp products.

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"Cannabis accessories"
means devices, equipment, materials, or products of any kind that are intended
or designed for use in planting, propagating, cultivating, growing, harvesting,
manufacturing, compounding, converting, producing, processing, preparing,
testing, analyzing, packaging, repackaging, storing, or containing cannabis, or
ingesting, inhaling, or otherwise introducing cannabis into the human body.

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"Cannabis business" means
any person holding a license or permit issued by the office pursuant to part
VII or any rules adopted pursuant to this chapter.

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"Cannabis concentrate"
means the separated resin, whether crude or purified, obtained, derived, or
extracted from cannabis.

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"Cannabis cultivator"
means a person licensed to cultivate cannabis pursuant to section A-112.

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"Cannabis flower" means
the flower of a plant of the genus Cannabis that has been harvested, dried, or
cured, before any processing whereby the plant material is transformed into a
cannabis product.

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"Cannabis plant" means the
plant of the genus Cannabis in the seedling, vegetative, or flowering stages,
with readily observable roots and leaves with serrated edges.
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"Cannabis plant" does not include a
germinated seed, cutting, or clone without readily observable roots and leaves
with serrated edges.

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"Cannabis processor" means
a person licensed to process cannabis pursuant to section A-113.

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"Cannabis product" means
any product containing or derived from cannabis, including an edible cannabis
product or cannabis concentrate.
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"Cannabis product" includes adult-use cannabis products and
medical cannabis products.

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"Cannabis regulation and
enforcement special fund" means the special fund established pursuant to
section A-16.

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"Caregiver" means a person
who is at least eighteen years of age who has agreed to undertake
responsibility for managing the well-being of a medical cannabis patient with
respect to the medical use of cannabis.
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In the case of a minor or an adult lacking legal capacity, the caregiver
shall be a parent, guardian, or person having legal custody of the medical
cannabis patient.

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"Certifying medical
professional" means a physician or an advanced practice registered nurse
who issues written certifications for the medical use of cannabis to qualifying
patients pursuant to section A-49.

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"Chief compliance officer"
means the chief compliance officer of the office established pursuant to
section A-11.

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"Chief equity officer"
means the chief equity officer of the office established pursuant to section
A-11.

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"Chief public health and
education officer" means the chief public health and education officer of
the office established pursuant to section A-11.

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"Child care facility" has
the same meaning as defined in section 346-151.

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"Child-resistant" means
designed or constructed to be significantly difficult for children under the
age of five to open, and not difficult for average adults to use properly.

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"Consumer" means a natural
person who is at least twenty-one years of age purchasing or using cannabis
pursuant to this chapter.

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"Craft cannabis
dispensary" means a person licensed to operate a craft cannabis dispensary
pursuant to section A-116.

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"Crude hemp extract" means
a hemp extract product for sale strictly to a hemp extract processor with a
valid license issued by the office pursuant to section A-133 or equivalent
authorization from a regulatory agency in another jurisdiction, and not
intended for use or consumption.

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"Cultivate" or
"cultivation" means cloning, curing, drying, grading, growing,
harvesting, propagating, or trimming of cannabis plants or hemp plants.

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"Debilitating medical
condition" means:

����
(1)
�
Acquired
immunodeficiency syndrome, cancer, epilepsy, glaucoma, lupus, multiple
sclerosis, positive status for human immunodeficiency virus, rheumatoid
arthritis, or the treatment of these conditions;

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(2)
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A chronic or
debilitating disease or medical condition or its treatment that produces one or
more of the following:

���������
(A)
�
Cachexia or
wasting syndrome;

���������
(B)
�
Severe pain;

���������
(C)
�
Severe nausea;

���������
(D)
�
Seizures,
including those characteristic of epilepsy;

���������
(E)
�
Severe and
persistent muscle spasms, including those characteristic of multiple sclerosis
or Crohn's disease; or

���������
(F)
�
Post-traumatic
stress disorder; or

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(3)
�
Any other medical
condition approved by the office, in consultation with the department of health,
under rules adopted pursuant to this chapter.

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"Decarboxylation" means
the completion of the chemical reaction that converts naturally occurring
cannabinoid acid into a cannabinoid, including delta-9-tetrahydrocannabinol's
acids into delta-9-tetrahydrocannabinol.

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"Delta-9-tetrahydrocannabinol"
means one of the cannabinoids that function as the primary psychoactive
component of cannabis.

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"Dispense" or
"dispensing" means to sell any cannabis to a consumer or medical
cannabis patient pursuant to this chapter.

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"Disproportionately impacted
area" means historically disadvantaged communities, areas of persistent
poverty, and medically underserved communities, as determined by the office in
rules adopted pursuant to this chapter.

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"Distribute" or
"distribution" means to sell at wholesale any cannabis to a cannabis
business or any hemp to a hemp business pursuant to this chapter.

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"Edible cannabis product"
means a cannabis product intended to be used orally, in whole or in part, for
human consumption, including cannabis products that dissolve or disintegrate in
the mouth.
�
"Edible cannabis
product" does not include any product otherwise defined as cannabis
concentrate.

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"Electronic cannabis smoking
device" means any electronic product that can be used to aerosolize and
deliver cannabis or hemp to the person inhaling from the device, including but
not limited to an electronic cigarette, electronic cigar, electronic cigarillo,
electronic pipe, hookah pipe, or hookah pen, and any cartridge or other
component of the device or related product, whether or not sold separately.

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"Employment" has the same
meaning as defined in section 378-1.

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"Firearm" has the same meaning
as defined in section 134-1.

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"Hemp" means all parts of
the plant of the genus Cannabis, whether growing or not, including the seeds
thereof and all derivatives, extracts, cannabinoids, isomers, acids, salts, and
salts of isomers, with a delta-9-tetrahydrocannabinol concentration of no more
than 0.3 per cent on a dry weight basis, as measured post-decarboxylation.

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"Hemp business" means any
person that holds a license issued by the office pursuant to part VIII and any
rules adopted pursuant to this chapter.

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"Hemp coordinator" means
the hemp coordinator of the office established pursuant to section A-11.

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"Hemp cultivator" means a
person licensed to cultivate hemp pursuant to section A-132.

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"Hemp extract processor"
means a person licensed to process hemp pursuant to section A-133.

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"Hemp extract product"
means any hemp product derived from hemp, including all derivatives, extracts,
cannabinoids, isomers, acids, salts, and salts of isomers, with a
delta-9-tetrahydrocannabinol concentration of no more than 0.3 per cent on a
dry weight basis, as measured post-decarboxylation.
�
"Hemp extract product" does not
include industrial hemp products.

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"Hemp flower" means the
flower of a hemp plant that has been harvested, dried, or cured, before any
processing, with a delta-9-tetrahydrocannabinol concentration of no more than
0.3 per cent on a dry weight basis, as measured post-decarboxylation.

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"Hemp product" means any
product containing or derived from hemp with a delta-9-tetrahydrocannabinol
concentration of no more than 0.3 per cent on a dry weight basis, as measured
post‑decarboxylation.

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"Independent laboratory"
means a person licensed to operate an independent laboratory pursuant to
section A-111.

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"Industrial hemp product"
means any hemp product that is either:

����
(1)
�
Intended for
industrial use and not for human consumption, including textiles and
construction materials; or

����
(2)
�
Intended for human
consumption and generally recognized as safe (GRAS) by the United States Food
and Drug Administration for use in foods.

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"Labeling" means any label
or other written, printed, or graphic matter upon any container, packaging, or
wrapper that contains cannabis or hemp.

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"Laboratory agent" means
an employee of an independent laboratory, who is registered with the office and
possesses, processes, stores, tests, or transports cannabis, hemp, or hemp
extract products pursuant to section A-111.

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"Licensed business" means
any person that holds a license or permit issued by the office pursuant to this
chapter or any rules adopted pursuant to this chapter.
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"Licensed business" includes a cannabis
business and hemp business.

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"Licensed premises" means
the premises authorized to be used for the operation of a licensed business
pursuant to section A-80.

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"Marijuana" has the same
meaning as defined in section 712-1240.

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"Marijuana concentrate"
has the same meaning as defined in section 712-1240.

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"Medical cannabis" means
cannabis that is dispensed by a medical cannabis dispensary or retail cannabis
store to a medical cannabis patient or the patient's caregiver or cannabis for
the medical use of cannabis pursuant to this chapter.
�
"Medical cannabis" includes a
medical cannabis product.

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"Medical cannabis
dispensary" means a person licensed to operate a medical cannabis
dispensary pursuant to section A-114.

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"Medical cannabis patient"
means a qualifying patient or qualifying out-of-state patient that has
registered with the office pursuant to this chapter.

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"Medical cannabis product"
means any product containing or derived from cannabis, including an edible
cannabis product and cannabis concentrate, that is solely for medical use by a
medical cannabis patient pursuant to this chapter.

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"Medical cannabis registration
card" means a card issued by the office that certifies the card holder is
a medical cannabis patient.

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"Medical use" means the
acquisition, cultivation, possession, transportation, or use of cannabis or
cannabis accessories relating to the administration of cannabis to alleviate
the symptoms or effects of a medical cannabis patient's debilitating medical
condition.

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"Minor" has the same
meaning as defined in section 712-1240.

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"Office" means the Hawaii
cannabis and hemp office established pursuant to section A-11.

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"Person" means a natural
person, an association, a corporation, a firm, a partnership, or any form of
business or legal entity.

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"Personal adult use" means
the acquisition, cultivation, possession, transportation, or use of adult-use
cannabis or cannabis accessories by a person who is at least twenty-one years
of age.

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"Plant canopy" means the
square footage dedicated to flowering plants that are wider or taller than
twelve inches.
�
"Plant canopy"
does not include areas such as space used for the storage of fertilizers,
pesticides, or other products, quarantine, or office space.

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"Private residence" means
a house, condominium, or apartment.
�

"Private residence" does not include, unless otherwise
authorized by law, dormitories or other on-campus college or university housing;
bed-and-breakfast establishments, hotels, motels, or other commercial
hospitality operations; and federal public housing, shelters, or residential
programs.

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"Process" or
"processing" means to blend, compound, extract, infuse, or otherwise
make or prepare a cannabis product or hemp product.

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"Public housing project or
complex" has the same meaning as defined in section 712-1249.6.

����
"Qualifying out-of-state
patient" means a person residing outside of the State who has been
diagnosed by a physician or an advanced practice registered nurse as having a
debilitating medical condition and registered pursuant to section A-48.

����
"Qualifying patient" means
a person who has been diagnosed by a physician or an advanced practice
registered nurse as having a debilitating medical condition and registered
pursuant to section A-47.
�
"Qualifying
patient" does not include a qualifying out-of-state patient.

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"Resealable" means a
package that maintains its child‑resistant effectiveness, as well as
preserving the integrity of cannabis for multiple doses.

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"Restricted area" means an
enclosed and secured area within a licensed premises used to cultivate,
process, store, or test cannabis that is only accessible by authorized
employees of the licensed business, employees and agents of the office, state
and county law enforcement officers, emergency personnel, and other individuals
authorized by law to access the area.

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"Restricted cannabinoid"
means a cannabinoid on the restricted cannabinoid product list established and
maintained by the office pursuant to section A-131.

����
"Restricted cannabinoid
product" means any product containing an amount of any restricted
cannabinoid that exceeds the limit allowable for a hemp product, as established
by the office pursuant to section A-131.

����
"Retail cannabis store"
means a person licensed to operate a retail cannabis store pursuant to section
A-115.

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"School" has the same
meaning as defined in section 712-1249.6.

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"School vehicle" has the
same meaning as defined in section 286-181.

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"Seed-to-sale tracking
system" means a system for tracking the inventory of cannabis from either
the seed or immature plant stage until the cannabis is dispensed or destroyed.

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"Smoke" or
"smoking" means inhaling, exhaling, burning, or carrying any lighted
or heated cannabis or hemp intended for inhalation in any manner or in any
form.
�
"Smoke" or "smoking"
includes the use of an electronic cannabis smoking device.

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"Social equity grant
applicant" means an applicant for licensure or a permit under this
chapter, or for a grant under the social equity grant program established pursuant
to section A-141, who is a resident of the State and meets one or more of the
following criteria:

����
(1)
�
The applicant is
at least fifty-one per cent owned and controlled by one or more individuals who
have resided in a disproportionately impacted area for at least five of the
preceding ten years;

����
(2)
�
For applicants
with a minimum of ten full-time employees, at least fifty-one per cent of the
applicant's current employees reside in a disproportionately impacted area; or

����
(3)
�
The applicant satisfies
any other criteria determined by the office and adopted as rules pursuant to
this chapter.

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"Tetrahydrocannabinol"
means the group of cannabinoids that function as the primary psychoactive
component of cannabis.

����
"Under the influence" has
the same meaning as defined in section 291E-1.

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"Vehicle" means any
automobile, airplane, motorboat, motorcycle, or other motor-propelled vehicle.

����
"Written certification"
means a written statement issued and signed by a certifying medical
professional pursuant to section A-46.

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�A-4
�
General exemptions.
�
(a)
�

Notwithstanding any law to the contrary, including part IV of chapter
329 and part IV of chapter 712, actions authorized pursuant to this chapter
shall be lawful if done in strict compliance with the requirements of this
chapter and any rules adopted pursuant to this chapter.

����
(b)
�

A person may assert strict compliance with this chapter or rules adopted
pursuant to this chapter as an affirmative defense to any prosecution involving
marijuana or marijuana concentrate, including under part IV of chapter 329 and
part IV of chapter 712.

����
(c)
�

Actions that do not strictly comply with the requirements of this
chapter and any rules adopted pursuant to this chapter shall be unlawful and
subject to civil, criminal, or administrative procedures and penalties, or all
of the above, as provided by law.

����
�A-5
�
Limitations; construction with other laws.
�
Nothing in this chapter shall be construed
to:

����
(1)
�
Supersede any law
relating to operating a vehicle under the influence of an intoxicant;

����
(2)
�
Supersede any law
involving the performance of any task while impaired by cannabis that would
constitute negligence or professional malpractice, or prevent the imposition of
any civil, criminal, or other penalty for the conduct;

����
(3)
�
Supersede any law
prohibiting or relating to smoking or vaping, including chapter 328J;

����
(4)
�
Authorize the
possession or use of cannabis or cannabis accessories on the grounds of or
within a child care facility, school, daycare center, youth center, college,
university, or other educational institution, including a nursery school or
summer camp; school vehicle; or any correctional facility or detoxification
facility; provided that a caregiver may administer a medical cannabis product
that is not intended for inhalation to a medical cannabis patient under the age
of twenty-one in a vehicle on school grounds; provided further that a college
or university may authorize the possession or use of cannabis or cannabis
accessories by persons who are at least twenty-one years of age on the grounds
of or within the college or university in accordance with this chapter, and may
allow medical use of cannabis by a college or university faculty member or
student while the faculty member or student is within faculty or student
housing; or

����
(5)
�
Require any person
that occupies, owns, or controls real property to allow the consumption,
cultivation, dispensing, display, distribution, or processing of cannabis on or
within that property; provided that in the case of the rental of a residential
dwelling, a landlord shall not prohibit the possession of cannabis or the
consumption of cannabis that is not intended for inhalation in accordance with
this chapter, unless:

���������
(A)
�
The tenant is
renting a room or rooms in only a portion of a residence, where the rest of the
residence is rented to other people or occupied by the landlord;

���������
(B)
�
The residence is
incidental to detention or the provision of counseling, educational, geriatric,
medical, religious, or similar service;

���������
(C)
�
The residence is a
transitional housing facility; or

���������
(D)
�
Failing to
prohibit the possession or use of cannabis would violate federal law or
regulations or cause the landlord to lose a monetary or licensing-related
benefit under federal law or regulations.

PART
II.
�
ADMINISTRATION

����
�A-11
�
Hawaii cannabis and hemp office; established.
�
(a)
�

There shall be established the Hawaii cannabis and hemp office, which
shall be a public body corporate and politic and an instrumentality and agency
of the State for the purpose of implementing this chapter.
�
The office shall be placed within the
department of commerce and consumer affairs for administrative purposes
only.
�
The department of commerce and
consumer affairs shall not direct or exert authority over the day-to-day
operations or functions of the office.

����
(b)
�

The office shall exercise its authority by and through the administrator
who shall have expertise and training in the field of cannabis regulation or
public health administration.
�
The
administrator shall be nominated and, by and with the advice and consent of the
senate, appointed by the governor.
�
The
administrator shall be exempt from chapter 76 and shall serve at the pleasure
of the governor.
�
The term of the
administrator shall be coterminous with the term of the governor.

����
(c)
�

At a minimum, the staff of the office shall consist of:

����
(1)
�
One full-time
chief compliance officer;

����
(2)
�
One full-time
chief equity officer;

����
(3)
�
One full-time
chief financial officer;

����
(4)
�
One full-time
chief public health and education officer;

����
(5)
�
One full-time
chief technology officer;

����
(6)
�
One full-time
executive secretary to the administrator;

����
(7)
�
One full-time
general counsel; and

����
(8)
�
One full-time hemp
coordinator,

each of whom shall be subject to chapter 76.

����
�A-12
�
Hawaii cannabis and hemp office; powers and
duties.
�
(a)
�
The protection of public health and safety
shall be the highest priorities for the office in exercising licensing,
regulatory, and disciplinary functions under this chapter.
�
Whenever the protection of public health and
safety is inconsistent with other interests sought to be promoted, the
protection of public health and safety shall be paramount.

����
(b)
�

The office shall have the following powers and duties as provided for in
this chapter to:

����
(1)
�
Sue and be sued;

����
(2)
�
Adopt a seal;

����
(3)
�
Administer oaths
and affirmations;

����
(4)
�
Establish and
amend a plan of organization that the office considers expedient;

����
(5)
�
Adopt rules, which
shall have the force and effect of law; provided that unless otherwise specified
in this chapter, the rules shall be adopted pursuant to chapter 91;

����
(6)
�
Register
qualifying patients and qualifying out-of-state patients for medical use of
cannabis pursuant to sections A-47 and A-48;

����
(7)
�
Develop a process
for qualifying patients, qualifying patients' caregivers, and consumers to
purchase cannabis plants for cultivation in accordance with sections A-42 and
A-53;

����
(8)
�
Establish a
procedure by which licenses or permits are awarded pursuant to this chapter;

����
(9)
�
Approve or deny
applications, including renewal applications and change in ownership
applications, for licenses or permits pursuant to this chapter;

���
(10)
�
Revoke or suspend
for cause any license, permit, or registration issued under this chapter;

���
(11)
�
Create and
maintain a publicly available directory of the names and locations of medical
cannabis dispensaries, retail cannabis stores, and craft cannabis dispensaries;

���
(12)
�
Create a system
whereby a licensed business can verify the status of other licensed businesses;

���
(13)
�
Conduct or
commission studies regarding market conditions and, on a periodic basis,
determine the maximum number of licenses that may be issued to meet estimated
production demand and facilitate a reduction in the unauthorized distribution
of cannabis;

���
(14)
�
Coordinate across
state departments and agencies to research and study any changes in cannabis
use and the impact that cannabis use and the number of licensed businesses may
have on access to cannabis, public health, and public safety;

���
(15)
�
Prepare, publish,
and distribute, with or without charge as the office may determine, bulletins,
guidance, reports, studies, and other materials that the office considers
appropriate;

���
(16)
�
Set, charge,
impose, and collect fees, fines, and civil penalties as authorized by this
chapter or rules adopted pursuant to this chapter; provided that all fees,
fines, and civil penalties received by the office shall be deposited into the
cannabis regulation and enforcement special fund;

���
(17)
�
Develop forms,
licenses, identification cards, and applications as are necessary or convenient
in the discretion of the administrator for the administration of this chapter
or rules adopted pursuant to this chapter;

���
(18)
�
Conduct background
checks as necessary for the purposes of implementing this chapter, including
criminal history record checks in accordance with section 846-2.7;

���
(19)
�
Establish and
amend cannabis district boundaries to ensure equal access to cannabis,
especially for medical use, and encourage the full participation in the
regulated cannabis industry from disproportionately impacted areas;

���
(20)
�
Investigate
violations of this chapter and, notwithstanding any law to the contrary,
violations of chapter 322 or 342F that are related to cultivation, processing,
distribution, sales, dispensing, consumption, possession, or use of cannabis or
hemp, including covert operations, and refer criminal violations to the proper
federal, state, or local authorities for prosecution as appropriate.
�
Investigations of violations of chapter B
shall be referred to the director of taxation to hear and determine complaints
against any licensed business;

���
(21)
�
Gather facts and
information applicable to the office's obligation to investigate applicants or
licensed businesses for:

���������
(A)
�
A violation of
this chapter or any rules adopted pursuant to this chapter; or

���������
(B)
�
A wilful violation
of an order of the office;

���
(22)
�
Seize and remove
from the licensed premises of a licensed business any cannabis, hemp,
equipment, supplies, documents, or records obtained or possessed in violation
of this chapter for the purpose of examination and inspection;

���
(23)
�
For cause, demand
and be granted access to all books, papers, and records of licensed businesses
for the purposes of audit, examination, inspection, and photocopying; provided
that the audit, examination, inspection, and photocopying may take place on the
licensed business's licensed premises or elsewhere as practicable and in the
presence of the licensed business or its agent;

���
(24)
�
Take appropriate
action against a person who, directly or indirectly, cultivates, processes,
sells, or purchases any cannabis without being authorized pursuant to this
chapter;

���
(25)
�
Enforce seizure,
confiscation, or forfeiture pursuant to this chapter or chapter 712A of any
cannabis or hemp not authorized under this chapter or rules adopted pursuant to
this chapter;

���
(26)
�
Establish
additional restrictions, requirements, or conditions, consistent with those
prescribed in this chapter, relating to the standards and requirements for
cultivating, processing, packaging, advertising, distributing, or dispensing
cannabis or hemp, including the ability to regulate ingredients, and the types,
forms, potency, and concentration of cannabis products or hemp extract products
that may be processed or sold, to ensure the health and safety of the public
and the use of proper ingredients and methods in the processing of all cannabis
and hemp to be sold or consumed in the State and to ensure that cannabis
products and hemp extract products are not packaged, marketed, or otherwise
sold in a way that targets minors or promotes excessive use of cannabis or
cannabis use disorders;

���
(27)
�
Conduct hearings
as required by law pursuant to chapter 91; provided that the office may examine
witnesses and take testimony, receive and determine the relevance of evidence,
issue subpoenas, regulate the course and conduct of the hearing, and make a final
ruling;

���
(28)
�
Appoint hearings
officers to conduct hearings as provided by law and under conditions that the
office shall establish by rules.
�
Each
hearings officer shall be deemed to be an agent of the office with all powers
associated with that designation;

���
(29)
�
Develop and
maintain a seed-to-sale tracking system;

���
(30)
�
Establish a social
equity grant program to encourage the full participation in the regulated
cannabis industry from disproportionately impacted areas;

���
(31)
�
Administer and
manage a state cannabis testing facility;

���
(32)
�
Recommend changes
to improve the administration of this chapter relating to the regulation of
cannabis;

���
(33)
�
Exercise the
powers and perform the duties in relation to the administration of the office
as necessary but not specifically vested by this chapter, including budgetary
and fiscal matters; and

���
(34)
�
Coordinate with
state and county law enforcement agencies to effectuate the purposes of this
chapter.

����
�A-13
�
Administrator; powers and duties.
�
The administrator shall have the following
powers and duties as provided for in this chapter to:

����
(1)
�
Exercise the
powers and perform the duties in relation to the administration of the office;

����
(2)
�
Execute all
instruments necessary or convenient for accomplishing the purposes of this
chapter;

����
(3)
�
Enter into
agreements or other transactions with a person, including a public entity or
other governmental instrumentality or governmental authority in connection with
its powers and duties under this chapter;

����
(4)
�
Employ, subject to
chapter 76, officers and employees, permanent and temporary, as required;

����
(5)
�
Apply for and
accept, on behalf of the office, advances, contributions, grants, and loans of
money or property, or other things of value from any source, to be held, used,
and applied for the office's purposes;

����
(6)
�
Provide and pay
for advisory services and technical assistance as may be necessary in the
administrator's judgment to carry out this chapter as provided by law;

����
(7)
�
Be present,
through the office's inspectors and agents, at any time, at the licensed
premises of a licensed business for the purposes of exercising the office's
regulatory responsibilities or inspecting the licensed premises and all
equipment and supplies located at the licensed premises;

����
(8)
�
Delegate the
powers provided in this section to other officers or employees of the office as
may be deemed appropriate by the administrator; and

����
(9)
�
Delegate powers
and duties of the administrator to other state or county departments or
agencies pursuant to memoranda of agreement for the purposes of implementing
the provisions of this chapter related to administration, investigation,
inspection, fee collection, document management, education and outreach,
distribution of individual licenses approved by the office, and technical
assistance pertaining to the cultivation of cannabis.

����
�A-14
�
Administrative rules; authority.
�
(a)
�
No
later than December 31, 2027, the office shall adopt interim rules, which shall
be exempt from chapters 91 and 201M, to effectuate the purposes of this
chapter; provided that the interim rules shall remain in effect until December
31, 2032, or until rules are adopted pursuant to subsection (c), whichever
occurs sooner.

����
(b)
�

The office may amend the interim rules to effectuate the purposes of
this chapter, and the amendments shall be exempt from chapters 91 and 201M;
provided that any amended interim rules shall remain in effect until December
31, 2032, or until rules are adopted pursuant to subsection (c), whichever
occurs sooner.

����
(c)
�

No later than December 31, 2032, the office shall adopt rules pursuant
to chapter 91 to effectuate the purposes of this chapter.

����
�A-15
�
Administrative rules; mandatory.
�
(a)
�

The rules adopted pursuant to section A-14 shall include:

����
(1)
�
Procedures for
application that an applicant for a license, permit, or registration must
follow and complete before consideration by the office;

����
(2)
�
A schedule of
fees, including application, license, permit, registration, and renewal fees,
in amounts necessary to pay for all regulation and enforcement costs of the
office; provided that fees may be relative to the volume of business conducted
or to be conducted by the licensed business;

����
(3)
�
Qualifications for
licensure or permitting and minimum standards for employment that are directly
and demonstrably related to the operation of a licensed business;

����
(4)
�
Procedures and
policies to promote and encourage full participation in the regulated cannabis
industry by people from disproportionately impacted areas;

����
(5)
�
Requirements for
licensure, permitting, and registration, including updating and renewing
licensure, permitting, and registration;

����
(6)
�
Requirements for
the information to be furnished by a licensed business relating to the licensed
business's employees, any necessary registration requirements for employees
working at a licensed business, and requirements that all licensed business
employees be properly trained in their respective professions as necessary;

����
(7)
�
Requirements for
fingerprinting or other method of identification for the purposes of criminal
history record checks as authorized by section 846-2.7;

����
(8)
�
Procedures and
grounds for penalties for violation of this chapter, including the
administrative hold, suspension, or revocation of a license, permit, or
registration;

����
(9)
�
Requirements for
recordkeeping by a licensed business, including the keeping of books, financial
records, statements, or other records of a licensed business;

���
(10)
�
Requirements and
procedures to track cannabis cultivated, processed, transported, delivered,
distributed, dispensed, tested, sold, or destroyed by licensed businesses;

���
(11)
�
Requirements and
procedures for the seed-to-sale tracking system;

���
(12)
�
Security
requirements for a licensed business sufficient to deter and prevent theft and
unauthorized entrance into restricted areas containing cannabis, which shall
include the use of security cameras; provided that the requirements shall not
prohibit the cultivation of cannabis outdoors or in greenhouses;

���
(13)
�
Requirements for
liability insurance coverage for a licensed business or requirements for other
adequate security against liabilities, including that a licensed business place
a certain sum in escrow to be expended for coverage of liabilities;

���
(14)
�
Requirements and
procedures sufficient to ensure the virtual separation of medical cannabis from
adult-use cannabis distributed by a cannabis processor or dispensed by a retail
cannabis store;

���
(15)
�
Requirements and
procedures to prevent the sale, delivery, or transfer of cannabis to persons
under the age of twenty-one, or the purchase of cannabis on behalf of a person
under the age of twenty-one, including a prohibition on persons under the age
of twenty-one entering the licensed premises of a licensed business unless
otherwise authorized for medical use pursuant to this chapter;

���
(16)
�
Standards for
manufacturing or extracting cannabinoid oil or butane hash oil;

���
(17)
�
The circumstances,
manner, and process by which a licensed business may apply for a change in
ownership, including procedures and requirements to enable the transfer of a
license for a licensed business to another qualified person or to another
suitable location subject to the office's approval;

���
(18)
�
Health and safety
standards, established in consultation with the department of health and
department of agriculture, for the cultivation, processing, distribution, and
dispensing of cannabis, including standards regarding sanitation for the
preparation, storage, handling, and sale of edible cannabis products and
compliance with chapter 321 and health inspections by the department of health;
provided that the power to adopt rules pertaining to the use of pesticides
shall remain with the department of agriculture;

���
(19)
�
Requirements for
the packaging of cannabis and hemp;

���
(20)
�
Requirements for
the potency or dosing limitations of cannabis, including separate requirements
for the potency or dosing limitations of medical cannabis;

���
(21)
�
Requirements for
the labeling of a package containing cannabis or hemp;

���
(22)
�
Procedures and
policies, in consultation with the department of agriculture, to promote and
encourage full participation in the regulated cannabis industry by legacy
growers and farmers and agricultural businesses with emphasis on promoting
small farms, diversified agriculture, and indigenous farming practices;

���
(23)
�
Requirements for
the safe disposal of excess, contaminated, adulterated, or deteriorated
cannabis;

���
(24)
�
Requirements for
advertising, marketing, and branding cannabis and hemp;

���
(25)
�
Requirements for a
process allowing the administrator to order a prohibition on the sale of
cannabis found to be detrimental to health or especially appealing to persons
under the age of twenty-one;

���
(26)
�
Requirements for a
process allowing a cannabis business to voluntarily submit a cannabis product,
its packaging, and intended marketing to the office for review of whether the
cannabis product is especially appealing to persons under the age of twenty-one;

���
(27)
�
Energy and
environmental standards for licensure and licensure renewal of cannabis
cultivators, cannabis processors, craft cannabis dispensaries, and hemp extract
processors;

���
(28)
�
Manners in which
licensed premises shall be constructed, arranged, furnished, equipped,
maintained, and operated;

���
(29)
�
Classification of
any cannabis-derived compound, cannabinoid or hemp-derived compound, or
cannabinoid; and

���
(30)
�
Prohibitions or
restrictions on the use of a synthetic cannabinoid or artificially derived
cannabinoid in any cannabis product or hemp product.

����
(b)
�

For the purposes of this section:

����
"Artificially derived
cannabinoid" means a chemical substance created by a chemical reaction
that changes the molecular structure of any chemical substance derived from the
plant of the genus Cannabis.
�
"Artificially
derived cannabinoid" does not include:

����
(1)
�
A naturally
occurring chemical substance that is separated from the plant of the genus
Cannabis by a chemical or mechanical extraction process; or

����
(2)
�
Cannabinoids that
are produced by decarboxylation from naturally occurring cannabinoid acid
without the use of a chemical catalyst.

����
"Synthetic cannabinoid"
means a cannabinoid that is:

����
(1)
�
Produced
artificially, whether from chemicals or from recombinant biological agents
including yeast and algae; and

����
(2)
�
Not derived from
the plant of the genus Cannabis, including biosynthetic cannabinoids.

����
�A-16
�
Cannabis regulation and enforcement special
fund; established.
�
(a)
�
There shall be established in the treasury of
the State the cannabis regulation and enforcement special fund to cover the
costs of:

����
(1)
�
The operations of
the office; and

����
(2)
�
Implementing,
administering, and enforcing this chapter.

����
(b)
�

The following shall be deposited into the cannabis regulation and
enforcement special fund:

����
(1)
�
Fees, fines, and
civil penalties received pursuant to this chapter and rules adopted pursuant to
this chapter;

����
(2)
�
The tax collected
pursuant to section B-3;

����
(3)
�
Appropriations
made by the legislature to the special fund;

����
(4)
�
Interest earned or
accrued on moneys in the special fund; and

����
(5)
�
Contributions,
grants, endowments, or gifts in cash or otherwise from any source.

����
(c)
�

There shall be established within the cannabis regulation and
enforcement special fund a social equity grant program subaccount.
�
The tax collected pursuant to section B-7(2)(A)
shall be deposited into the social equity grant program subaccount.
�
Moneys in the social equity grant program
subaccount shall be expended for the purposes of:

����
(1)
�
Implementing and administering the social
equity grant program as provided in part IX; and

����
(2)
�
Funding grants awarded by the advisory board and
administered by the designated expending agency under the social equity grant
program.

����
(d)
�

There shall be established within the cannabis regulation and
enforcement special fund a public health and education grant program
subaccount.
�
The tax collected pursuant
to section B-7(2)(B) shall be deposited into the public health and education
grant program subaccount.
�
Moneys in the
public health and education grant program subaccount shall be expended for the
purposes of:

����
(1)
�
Implementing and administering the public
health and education grant program as provided in part X; and

����
(2)
�
Funding grants awarded by the advisory board
and administered by the designated expending agency under the public health and
education grant program.

����
(e)
�

There shall be established within the cannabis regulation and
enforcement special fund a public safety grant program subaccount.
�
The tax collected pursuant to section B-7(2)(C)
shall be deposited into the public safety grant program subaccount.
�
Moneys in the public safety grant program
subaccount shall be expended for the purposes of:

����
(1)
�
Implementing and administering the public
safety grant program as provided in part XI; and

����
(2)
�
Funding grants awarded by the advisory board
and administered by the designated expending agency under the public safety
grant program.

����
(f)
�

There shall be established within the cannabis regulation and
enforcement special fund a Hawaii hemp grant program subaccount.
�
The tax collected pursuant to section B-7(2)(D)
shall be deposited into the Hawaii hemp grant program subaccount.
�
Moneys in the Hawaii hemp grant program
subaccount shall be expended for the purposes of:

����
(1)
�
Implementing and administering the Hawaii hemp
grant program as provided in sections A-174 and A-175; and

����
(2)
�
Funding grants awarded by the advisory board
and administered by the designated expending agency under the Hawaii hemp grant
program.

����
(g)
�

Moneys on balance in the cannabis regulation and enforcement special
fund at the close of each fiscal year shall remain in the special fund and
shall not lapse to the credit of the general fund.

����
�A-17
�
County law enforcement and prosecution.
�
Nothing in this chapter shall be construed to
relieve or diminish county law enforcement officers and prosecutors of any
authority or responsibility to enforce, or prosecute under, criminal laws
related to marijuana or marijuana concentrate, including this chapter, chapter
329, and part IV of chapter 712, in their respective counties.

����
�A-18
�
Investigation by a law enforcement agency of
unlawful activity.
�
Notwithstanding
any other law to the contrary, the administrator shall disclose any
information, documents, and other records regarding licensed businesses, upon
request, to any federal, state, or county agency engaged in the criminal
investigation or prosecution of violations of applicable federal, state, or
county laws, regulations, rules, or ordinances related to the operations or
activities of licensed businesses.

����
�A-19
�
Inspection; audits; reporting; authority.
�
(a)
�

Each licensed business shall:

����
(1)
�
Be subject to an
annual announced inspection and unlimited unannounced inspections of its
operations by the office; provided that inspections for license renewals shall
be unannounced;

����
(2)
�
Submit reports on
at least a quarterly basis, or as otherwise required, and in the format
specified by the administrator; and

����
(3)
�
Annually cause an
independent financial audit, at the licensed business's own expense, to be
conducted of the accounts, funds, programs, activities, and functions of the
licensed business.
�
The licensed business
shall submit the audit's findings to the administrator.
�
All audits shall be conducted in accordance
with generally accepted auditing standards established by the American
Institute of Certified Public Accountants.
�

The administrator may require a response, in writing, to the audit
results.
�
The response shall be made to
the administrator within fifteen calendar days of notification.

����
(b)
�

The office and attorney general may examine all records required to be
kept or filed under this chapter, and books, papers, and records of any person
engaged in the business of cultivating, processing, distributing, dispensing,
selling, or transferring cannabis or restricted cannabinoid products, to verify
compliance with this chapter and chapter B.
�

Every person in possession of any books, papers, and records, and the
person's agents and employees, shall be directed and required to give the
office and attorney general the means, facilities, and opportunities for the
examinations.

����
(c)
�

The office and attorney general may inspect the operations, premises,
and storage areas of any entity engaged in the cultivation, processing,
distribution, dispensing, sale, or transfer of cannabis or restricted
cannabinoid products, during regular business hours.
�
This inspection shall include inspection of
all statements, books, papers, and records in whatever format, including electronic
format, pertaining to the cultivation, processing, acquisition, possession,
transportation, sale, or use of cannabis or restricted cannabinoid products, to
verify compliance with this chapter and chapter B.
�
This inspection may also be conducted to
verify that all cannabis or restricted cannabinoid products were cultivated or
processed in compliance with this chapter.
�

Every entity in possession of any statements, books, papers, or records,
and the entity's agents and employees, shall be directed and required to give
the office and attorney general the means, facilities, and opportunities for
the inspections.

����
(d)
�

If the office or attorney general has reasonable cause to believe and
does believe that cannabis or restricted cannabinoid products are being
cultivated, processed, acquired, possessed, transported, kept, sold, or offered
for sale in violation of this chapter, the office or attorney general may
investigate or search the premises or vehicle in which the cannabis or
restricted cannabinoid products are believed to be located.
�
If cannabis or restricted cannabinoid
products are found on the premises or in a vehicle in violation of this
chapter, the cannabis or restricted cannabinoid products, or other tangible
personal property containing the cannabis or restricted cannabinoid products
and any books, papers, or records in possession of the entity in control or
possession of the cannabis or restricted cannabinoid products, may be seized by
the office or attorney general and shall be subject to forfeiture as provided
in this chapter and chapter 712A.

����
�A-20
�
Forfeiture; confiscation and seizure;
disposition.
�
(a)
�
Any cannabis or restricted cannabinoid
product unlawfully cultivated, processed, possessed, kept, stored, retained,
held, owned, received, transported, imported, or caused to be imported,
acquired, distributed, sold, or offered for sale in violation of this chapter
may be seized and confiscated by the attorney general and ordered forfeited
pursuant to chapter 712A.

����
(b)
�

The attorney general, department of law enforcement, and police
department of each of the counties may seize and confiscate any cannabis or
restricted cannabinoid product that is cultivated, processed, possessed, kept,
stored, retained, held, owned, received, transported, imported, or caused to be
imported, acquired, distributed, sold, or offered for sale in violation of this
chapter.
�
Law enforcement agencies
seizing live plants as evidence shall not be responsible for the care and
maintenance of the plants.

����
(c)
�

Any cannabis or restricted cannabinoid product forfeited as provided in
this section shall be ordered destroyed.

����
�A-21
�
County authority.
�
(a)
�

Each county may, by amendment of their zoning ordinances, pursuant to
the powers granted under section 46-4, place reasonable restrictions on the
location of licensed businesses.

����
(b)
�

Nothing in this chapter shall be construed to supersede or in any manner
affect a county smoking ordinance; provided that the ordinance is at least as
protective of the rights of nonsmokers as this chapter.

����
�A-22
�
Contracts pertaining to lawful operation of a
cannabis business; enforceable.
�

Notwithstanding any other law to the contrary, contracts related to
lawful activities authorized by this chapter shall be enforceable.
�
A contract entered into by a cannabis business,
or by those who allow property to be used by a cannabis business, shall not be
unenforceable or void solely for the reason that the activity permitted by this
chapter is prohibited by federal law.

����
�A-23
�
Provision of professional services to a
cannabis business.
�
A person engaged
in a profession or occupation subject to state or county licensure shall not be
subject to disciplinary action by a professional licensing authority solely for
providing professional services to a cannabis business related to activity
permitted by this chapter.

����
�A-24
�
Office employees; background checks.
�
(a)
�

The office shall conduct background checks, which may include criminal
history record checks in accordance with section 846‑2.7, on:

����
(1)
�
Current or
prospective employees of the office; and

����
(2)
�
Current or
prospective contractors or subcontractors and employees of current or
prospective contractors or subcontractors of the office.

����
The office shall develop procedures
for conducting background checks.

����
(b)
�

The office may refuse to employ or deny employment to an applicant or
terminate or refuse to secure the services of any contractor or subcontractor
if the person has been convicted of a crime, and if the administrator finds by
reason of the nature and circumstances of the crime that the person poses a
risk to the integrity of the office; provided that the office shall not refuse
to employ or deny employment to an applicant or terminate or refuse to secure
the services of any contractor or subcontractor if the person's conviction:

����
(1)
�
Is pardoned or
expunged;

����
(2)
�
Resulted in a term
of probation, incarceration, or supervised release that was completed more than
ten years preceding the date of application or termination; or

����
(3)
�
Is solely for a
marijuana-related offense, unless the offense involved a minor, including the
offense under section 712-1249.6; involved a firearm, including the offense
under section 134-7(b); or was committed after, or within one year before, July
1, 2026.

����
(c)
�

Refusal, revocation, or termination may occur only after appropriate
investigation and notification to the current or prospective employee,
contractor, or subcontractor of results and planned action, and after the
current or prospective employee, contractor, or subcontractor is given an
opportunity to meet and rebut the finding.
�

Nothing in this section shall abrogate any applicable appeal rights
under chapter 76 or 89.

����
�A-25
�
Annual report.
�
No later than twenty days prior to the
convening of the regular session of 2027, and every year thereafter, the
administrator shall submit a report to the governor and legislature on the
establishment and regulation of licensed businesses.
�
The report shall cover the information during
the prior fiscal year and, at a minimum, include the following information:

����
(1)
�
The number of
applications for each type of license and permit submitted to the office
pursuant to this chapter, including, if applicable, the number of applications
for license and permit renewals;

����
(2)
�
The total number
of each type of license and permit issued pursuant to this chapter that is
actively held by a licensed business;

����
(3)
�
The total square
footage of plant canopy approved by the office for cannabis cultivation and the
percentage of active cannabis cultivation by cultivation tier;

����
(4)
�
The total amount
of application fees and license, permit, and registration fees collected
pursuant to this chapter and the total amount of the tax revenue collected on
the sale of cannabis;

����
(5)
�
The total reported
volume and value of cannabis cultivated by all cannabis cultivators;

����
(6)
�
The total reported
volume and value of cannabis distributed and dispensed by all licensed
businesses;

����
(7)
�
The number of
inspections of licensed businesses performed by the office and the results of
those inspections, including the number of inspections resulting in license
violations and the percentage of all licensed businesses inspected;

����
(8)
�
The number of
license violations committed by licensed businesses and a breakdown of those
violations into specific categories based on the type of violation and the
outcome of the violation, including the total amount of monetary penalties
imposed and collected by the office and the percentage of total license
violations resulting in the imposition of a monetary penalty, administrative
hold, license suspension, or license revocation;

����
(9)
�
Public health and
safety data, including accidental ingestion by minors and cannabis-related
driving accidents, collected, received, or analyzed by the office; and

���
(10)
�
Recommendations,
including any proposed legislation, to address any issues with the regulation
of the cannabis industry in the State encountered by the office, departments,
or agencies.

����
�A-26
�
Advisory board on medical and adult-use
cannabis.
�
(a)
�
Beginning January 1, 2027, there shall be
established within the office an advisory board on medical and adult-use
cannabis.
�
The advisory board shall:

����
(1)
�
Be responsible for reviewing and awarding
grants under:

���������
(A)
�
The
social equity grant program pursuant to part IX;

���������
(B)
�
The
public health and education grant program pursuant to part X;

���������
(C)
�
The
public safety grant program pursuant to part XI; and

����
����
(D)
�
The Hawaii hemp grant program pursuant to sections
A-174 and A-175;

����
(2)
�
Consider all matters submitted to it by
the governor, legislature, and office; and

����
(3)
�
Study and make recommendations on:

���������
(A)
�
The impact of federal laws,
regulations, policies, guidance, or judicial decisions on the legal medical
cannabis and adult�use cannabis industries in the State, if applicable;

���������
(B)
�
Measures to protect and promote the
legal medical cannabis and adult�use cannabis industries in the State, if
applicable, in response to federal laws, regulations, policies, guidance, or
judicial decisions;

���������
(C)
�
Measures to enable cannabis businesses
to compete in interstate commerce related to the cultivation, manufacture,
distribution, and testing of cannabis;

���������
(D)
�
Methods to ensure that there is an
adequate supply of affordable cannabis for qualifying patients, including
cannabis containing varying levels of potency;

���������
(E)
�
Pathways to increase the participation
of legacy cannabis growers and businesses that are small, minority-owned, or
women�owned in the legal medical cannabis and adult�use cannabis industry in
the State, if applicable; and

���������
(F)
�
Methods to assist social equity grant
applicants, social equity grant licensees, and businesses that are small,
minority-owned, or women�owned in:

��������������
(i)
�
Accessing funds for operating or
capital expenses associated with a business participating in the medical
cannabis or adult�use cannabis industry, if applicable;

�������������
(ii)
�
Obtaining financing from a lender; and

������������
(iii)
�
Partnering with operational cannabis
businesses in ways that allow the social equity grant applicants or licensees
or small, minority-owned, or women�owned businesses to retain ownership and
control of the licenses and businesses.

����
(b)
�
The advisory board shall consist of eleven
members, who shall be appointed by the governor pursuant to section 26-34;
provided that three members shall be appointed from a list of nominees
submitted by the president of the senate and three members shall be appointed
from a list of nominees submitted by the speaker of the house of
representatives.

����
At
a minimum, the composition of the advisory board shall include the following:

����
(1)
�
One member who shall have a
professional background in the hemp industry;

����
(2)
�
One member who shall have professional
experience in oversight or industry management, including commodities,
production, or distribution, in the cannabis industry;

����
(3)
�
One member who shall have a
professional background in public health, mental health, substance abuse
treatment, or toxicology;

����
(4)
�
One member who shall have a
professional background in public safety or law enforcement;

����
(5)
�
One member who shall have expertise in
Hawaii's agricultural community; and

����
(6)
�
One member who shall have expertise in
Native Hawaiian culture and diversity.

����
(c)
�
To be eligible to serve as a member, a person
shall be:

����
(1)
�
At least twenty-five years old; and

����
(2)
�
A resident of the State who has resided
in the State for at least the immediately preceding five years before the
appointment.

����
(d)
�
The advisory board shall select one of its
members to serve as chair.

����
(e)
�
Members of the advisory board shall serve
without compensation.

����
(f)
�
The advisory board shall establish at least
two subcommittees to focus on medical cannabis and adult�use cannabis.

����
(g)
�
The office shall provide staff for the
advisory board.

����
(h)
�
The advisory board shall be subject to
chapter 92.

PART
III.
�
AUTHORIZED CONDUCT; MEDICAL USE OF
CANNABIS

����
�A-41
�
Possession of cannabis for medical use;
protections.
�
(a)
�
Notwithstanding any law to the contrary,
except as limited by this chapter, it shall be lawful for a medical cannabis
patient or the patient's caregiver to:

����
(1)
�
Purchase,
transport, or possess jointly between the medical cannabis patient and the
patient's caregiver, an adequate supply of cannabis; and

����
(2)
�
Transfer an
adequate supply of cannabis, without compensation of any kind, from a caregiver
to the caregiver's medical cannabis patient.

����
(b)
�

For medical use only, it shall be lawful for a medical cannabis patient
to smoke, ingest, or consume cannabis.

����
(c)
�

Notwithstanding any law to the contrary, in addition to an adequate
supply of cannabis, a qualifying patient or the patient's caregiver may
lawfully possess jointly between them, in their private residences, up to one
pound of cannabis produced by their cultivation of cannabis for medical use
pursuant to section A‑42; provided that no more than two pounds of any
cannabis in total, whether for medical use or personal adult use, shall be
stored at any private residence, regardless of the number of people residing
there.

����
(d)
�

All medical cannabis dispensed by a licensed business shall be stored in
sealed, child‑resistant, and resealable packaging with original labels,
and shall not be easily accessible to any person under the age of twenty‑one
unless that person is a medical cannabis patient.
�
All cannabis cultivated by a qualifying
patient or the patient's caregiver shall be stored in a manner that is not
easily accessible to any person under the age of twenty-one unless that person
is a medical cannabis patient.

����
(e)
�

All medical cannabis shall be transported in a sealed container, shall
not be visible to the public, and shall not be removed from its sealed
container or consumed or used in any way while in a public place or moving
vehicle.

����
(f)
�

No school shall refuse to enroll or otherwise penalize, and no landlord
shall refuse to lease property to or otherwise penalize, a person solely for
the person's status as a medical cannabis patient or caregiver, unless failing
to do so would cause the school or landlord to lose a monetary or
licensing-related benefit under federal law or regulation; provided that the
person strictly complied with the requirements of this part.

����
(g)
�

For the purposes of medical care, including organ and tissue
transplants, a person's medical use of cannabis in compliance with this part
shall be considered the equivalent of the use of any other medication under the
direction of a physician or advanced practice registered nurse and shall not
constitute the use of an illicit substance or otherwise disqualify a person
from medical care, unless in the judgment of the health care provider the use
of cannabis increases the risk for an adverse outcome from a medical procedure
or treatment.

����
(h)
�

No person shall be denied custody, visitation, or parenting time with a
minor for conduct allowed under this part and no presumption of neglect or
child endangerment shall arise therefrom; provided that this subsection shall
not apply if the person's conduct creates a danger to the safety of the minor
as established by a preponderance of the evidence.

����
(i)
�

Except as provided in this chapter, the State and any of its political
subdivisions shall not impose any discipline upon an employee or deny an
employee any benefit or entitlement for conduct permitted under this part or
solely for the presence of cannabinoids or cannabinoid metabolites in the
urine, blood, saliva, breath, hair, or other tissue or fluid of a person,
unless the failure to do so would cause the State or any of its political
subdivisions to lose a monetary or licensing-related benefit under a contract
or federal law, or otherwise violate federal law.
�
This subsection shall not be construed to
prohibit the State or any of its political subdivisions from:

����
(1)
�
Conducting drug
testing and using the results of those tests for the discipline of an employee
if the testing is done to comply with federal requirements or in accordance
with the applicable collective bargaining agreement or executive order; or

����
(2)
�
Disciplining
employees for being impaired by cannabis while at work.

����
(j)
�

The authorization of a medical cannabis patient to use medical cannabis
shall be inclusive of, and not in addition to, the authorization for personal
adult use of cannabis, if personal adult use is authorized pursuant to section
A-51.

����
�A-42
�
Cultivation of cannabis for medical use.
�
(a)
�

Notwithstanding any other law to the contrary, a qualifying patient or
the patient's caregiver may:

����
(1)
�
Possess, plant, or
cultivate no more than ten living cannabis plants, whether mature or immature,
for medical use only; and

����
(2)
�
Harvest, dry, and
process the cannabis produced by the plants under paragraph (1) for the
qualifying patient's medical use only.

����
(b)
�

The personal cultivation of cannabis for medical use shall only be
permitted within, or on the grounds of, the private residence of a qualifying
patient or the patient's caregiver; provided that no more than ten plants,
whether mature or immature and whether for medical use or personal adult use,
if authorized pursuant to section A-51, shall be cultivated at a private
residence at any time regardless of the number of qualifying patients,
caregivers, or other people residing at the private residence.

����
(c)
�

Cannabis plants cultivated for medical use shall be kept in a secured
place not easily accessible to any person under the age of twenty-one unless
that person is a qualifying patient.

����
(d)
�

Cannabis plants cultivated for medical use shall not be visible to the
public without the use of technology.

����
(e)
�

A landlord, condominium association, planned community association, or
similar association may limit or prohibit the personal cultivation of cannabis
for medical use through contracts, lease or rental agreements, bylaws, or
rules.

����
(f)
�

The office shall adopt rules pursuant to this chapter to establish
requirements and restrictions for the personal cultivation of cannabis for
medical use, including manners in which cannabis may be cultivated or processed
and further restrictions necessary to ensure that the personal cultivation of
cannabis for medical use is not utilized for unlicensed illicit activity;
provided that any rules adopted by the office shall not completely or
essentially prohibit the personal cultivation of cannabis for medical use.

����
�A-43
�
Conditions of medical use of cannabis by a
qualifying patient.
�
(a)
�
The medical use of cannabis by a qualifying
patient shall only be authorized if:

����
(1)
�
The qualifying
patient has been diagnosed by, and is under the continuing care of, a
certifying medical professional as having a debilitating medical condition;

����
(2)
�
The qualifying patient's
certifying medical professional has issued a written certification for the
qualifying patient;

����
(3)
�
The qualifying
patient has paid the required fee for registration;

����
(4)
�
The qualifying
patient has registered with the office pursuant to section A-47;

����
(5)
�
The qualifying
patient receives a medical cannabis registration card from the office; and

����
(6)
�
The amount of
cannabis possessed by the qualifying patient does not exceed the amount
authorized in section A-41.

����
(b)
�

Subsection (a) shall not apply to a qualifying patient under the age of
eighteen, unless:

����
(1)
�
The qualifying
patient's certifying medical professional has explained the potential risks and
benefits of the medical use of cannabis to the qualifying patient and a parent,
guardian, or person having legal custody of the qualifying patient; and

����
(2)
�
A parent,
guardian, or person having legal custody of the qualifying patient consents in
writing to:

���������
(A)
�
Allow the
qualifying patient's medical use of cannabis;

���������
(B)
�
Serve as the
qualifying patient's caregiver; and

���������
(C)
�
Control the
acquisition, dosage, and frequency of the medical use of cannabis by the
qualifying patient.

����
�A-44
�
Reciprocity with other states; qualifying
out-of-state patients.
�
(a)
�
Notwithstanding any law to the contrary, the
medical use of cannabis by a qualifying out-of-state patient who is at least
eighteen years of age shall be authorized only if the qualifying out-of-state
patient:

����
(1)
�
Is legally
authorized to use cannabis for medical purposes in another state, the District
of Columbia, or a United States territory;

����
(2)
�
Attests under
penalty of law pursuant to section 710‑1063 that the condition for which
the qualifying out-of-state patient is legally authorized to use cannabis for
medical purposes is a debilitating medical condition;

����
(3)
�
Provides consent
for the office to obtain information from the qualifying out-of-state patient's
certifying physician or advanced practice registered nurse and from the entity
that issued the medical cannabis authorization for the purpose of allowing the
office to verify the information provided in the registration process;

����
(4)
�
Pays the required
fee for out-of-state registration;

����
(5)
�
Registers with the
office pursuant to section A-48;

����
(6)
�
Receives a medical
cannabis registration card from the office; and

����
(7)
�
Abides by all laws
relating to the medical use of cannabis, including not possessing amounts of
cannabis that exceed an adequate supply.

����
(b)
�

The medical use of cannabis by a qualifying out‑of‑state
patient under the age of eighteen shall be permitted only if:

����
(1)
�
The caregiver of
the qualifying out-of-state patient provides the information required pursuant
to, and abides by the requirements of, subsection (a); and

����
(2)
�
The caregiver of
the qualifying out-of-state patient consents in writing to:

���������
(A)
�
Allow the
qualifying out-of-state patient's medical use of cannabis;

���������
(B)
�
Undertake the
responsibility for managing the well-being of the qualifying out-of-state
patient with respect to the medical use of cannabis; and

���������
(C)
�
Control the
acquisition, dosage, and frequency of the medical use of cannabis by the
qualifying out-of-state patient.

����
�A-45
�
Limitation; scope of medical use of cannabis.
�
The authorization for the medical use of
cannabis in this part shall not apply to:

����
(1)
�
The medical use of
cannabis that endangers the health or well-being of another person;

����
(2)
�
The manufacture,
distribution, dispensing, possession, or medical use of cannabis:

���������
(A)
�
In a school
vehicle, public transportation, or any moving vehicle;

���������
(B)
�
In the workplace
of one's employment;

���������
(C)
�
On any school
grounds;

���������
(D)
�
At any public
park, beach, or recreation or youth center;

���������
(E)
�
In or on any land,
facility, building, or vehicle owned, controlled, or operated by the State or
any county;

���������
(F)
�
In or on any
federal fort or arsenal, national park or forest, other federal enclave, or
other property owned, controlled, or operated by the federal government; or

���������
(G)
�
At any other place
open to the public, including smoking or vaping cannabis in public as
prohibited by chapter 328J;

���������
provided that a caregiver may
administer a medical cannabis product that is not intended for inhalation to a
medical cannabis patient under the age of twenty-one in a vehicle on school
grounds; provided further that a college or university may authorize the
medical use of cannabis by persons who are at least twenty-one years of age on
the grounds of or within the college or university in accordance with this
chapter, and may allow medical use of cannabis by a college or university
faculty member or student while the faculty member or student is within faculty
or student housing; and

����
(3)
�
The medical use of
cannabis by any person that is not a medical cannabis patient, including a
parent or caregiver.

����
�A-46
�
Written certifications; qualifying patients.
�
(a)
�
A
qualifying patient shall have a valid written certification from a certifying
medical professional stating that, in the certifying medical professional's
professional opinion:

����
(1)
�
The qualifying
patient has a debilitating medical condition; and

����
(2)
�
The potential
benefits of the medical use of cannabis would likely outweigh the health risks
of cannabis use for the qualifying patient.

����
(b)
�

The office shall adopt rules pursuant to this chapter to establish
procedures and requirements for a written certification; provided that a
written certification shall:

����
(1)
�
Include the name,
address, patient identification number, and other identifying information of
the qualifying patient;

����
(2)
�
Be valid for one
year from the time of signing; provided that the office may allow for the
validity of any written certification for up to three years if the qualifying
patient's certifying medical professional states that the qualifying patient's
debilitating medical condition is chronic in nature;

����
(3)
�
Be in a form
prescribed by the office and completed by or on behalf of a qualifying patient;
and

����
(4)
�
Be issued and
certified by a certifying medical professional who has a bona fide
physician-patient relationship or bona fide advanced practice registered
nurse-patient relationship, as applicable, with the qualifying patient.

����
�A-47
�
Registration; qualifying patients;
caregivers.
�
(a)
�
Qualifying patients shall register with the
office.
�
The office shall adopt rules to
establish procedures and requirements for the registration of qualifying
patients; provided that:

����
(1)
�
Every qualifying
patient shall:

���������
(A)
�
Provide sufficient
identifying information to establish the qualifying patient's personal
identity;

���������
(B)
�
Provide the
address of the location where the qualifying patient or the patient's caregiver
intends to cultivate cannabis for medical use pursuant to section A-42; and

���������
(C)
�
Report a change in
any information provided to the office for registration within ten business
days of the change;

����
(2)
�
The registration
form prescribed by the office shall require information from the qualifying
patient, the patient's caregiver, and the patient's certifying medical
professional as specifically required by this chapter or rules adopted pursuant
to this chapter;

����
(3)
�
The office shall
issue to the qualifying patient a medical cannabis registration card and may
charge a fee for the registration in an amount set in rules by the office; and

����
(4)
�
The registration
shall be effective until the expiration of the written certification provided
by the certifying medical professional.

����
(b)
�

The caregiver of a qualifying patient shall register with the
office.
�
The office shall adopt rules to
establish procedures and requirements for the registration of caregivers;
provided that:

����
(1)
�
Every caregiver
shall provide sufficient identifying information to establish the caregiver's
personal identity;

����
(2)
�
No caregiver shall
be registered for more than five qualifying patients at any given time; and

����
(3)
�
Every qualifying
patient shall have only one caregiver; provided that the office may permit the
parents, guardians, or persons having legal custody of a qualifying patient who
is under the age of eighteen to each register as caregivers.

����
(c)
�

Upon inquiry by a law enforcement agency, the office shall immediately
verify whether a person who is the subject of the inquiry has registered with
the office and the location of the person's registered cultivation site and
shall provide reasonable access to the registry information for official law
enforcement purposes.
�
An inquiry and
verification under this subsection may be made twenty-four hours a day, seven
days a week.

����
(d)
�

This section shall not apply to registration of a qualifying
out-of-state patient or a caregiver of a qualifying out-of-state patient.

����
�A-48
�
Registration; qualifying out-of-state
patients; caregivers.
�
(a)
�
A qualifying out-of-state patient shall
register with the office.
�
The office
shall adopt rules to establish procedures and requirements for registration of
qualifying out-of-state patients; provided that:

����
(1)
�
Every qualifying
out-of-state patient shall:

���������
(A)
�
Provide a valid
government-issued medical cannabis card or any equivalent certificate issued by
another state, the District of Columbia, or a United States territory;

���������
(B)
�
Provide a valid
photographic identification card or driver's license issued by the same
jurisdiction that issued the medical cannabis card or equivalent certificate;
and

���������
(C)
�
Have a
debilitating medical condition;

����
(2)
�
The office shall
issue to the qualifying out‑of‑state patient a medical cannabis
registration card and shall charge a fee for the registration in an amount set
in rules by the office; and

����
(3)
�
The registration
shall be effective for no more than sixty days and may be renewed for no more
than one additional sixty-day period that begins no later than twelve months
after the preceding registration date; provided that the office shall not
register any qualifying out-of-state patient for a period that exceeds the term
of validity of the qualifying out‑of‑state patient's authority for
the medical use of cannabis in the patient's home jurisdiction.

����
(b)
�

The caregiver of a qualifying out-of-state patient shall register with
the office.
�
The office shall adopt rules
to establish procedures and requirements for registration of caregivers;
provided that:

����
(1)
�
Every caregiver
shall provide sufficient identifying information to establish the caregiver's
personal identity; and

����
(2)
�
In the case of any
qualifying out-of-state patient who is under the age of eighteen, the office
shall register the qualifying out-of-state patient and the patient's caregiver;
provided that the office may register two caregivers for a qualifying out-of-state
patient if each caregiver is the parent, guardian, or person having legal
custody of the qualifying out‑of‑state patient who is under the age
of eighteen.

����
(c)
�

Upon inquiry by a law enforcement agency, the office shall immediately
verify whether a person who is the subject of the inquiry has registered with
the office and shall provide reasonable access to the registry information for
official law enforcement purposes.
�
An
inquiry and verification under this subsection may be made twenty-four hours a
day, seven days a week.

����
(d)
�

The office may temporarily suspend the registration of qualifying
out-of-state patients or their caregivers for a period of up to thirty days if
the office determines that the registration process for qualifying patients or
their caregivers is being adversely affected or the supply of cannabis for
medical use available in medical cannabis dispensaries and retail cannabis
stores is insufficient to serve both qualifying patients and qualifying
out-of-state patients.
�
A temporary
suspension may be extended by thirty-day periods until the office determines
that:

����
(1)
�
Adequate capacity
exists to register qualifying out-of-state patients and their caregivers in
addition to qualifying patients and their caregivers; and

����
(2)
�
The medical
cannabis dispensaries and retail cannabis stores are able to meet the demands
of qualifying patients and qualifying out-of-state patients.

����
�A-49
�
Certifying medical professionals.
�
(a)
�

The office shall adopt rules to establish requirements for certifying
medical professionals.

����
(b)
�

No certifying medical professional shall be subject to arrest or
prosecution, penalized in any manner, or denied any right or privilege for
providing a written certification for the medical use of cannabis for a
qualifying patient; provided that:

����
(1)
�
The certifying
medical professional has diagnosed the patient as having a debilitating medical
condition;

����
(2)
�
The certifying
medical professional has explained the potential risks and benefits of the
medical use of cannabis; and

����
(3)
�
The written
certification is based upon the certifying medical professional's professional
opinion after having completed a full assessment of the qualifying patient's
medical history and current medical condition made in the course of a bona fide
physician‑patient relationship or bona fide advanced practice registered
nurse-patient relationship, as applicable.

����
(c)
�

For purposes of this part, a bona fide physician‑patient
relationship may be established via telehealth, as defined in section
453-1.3(j), and a bona fide advanced practice registered nurse-patient
relationship may be established via telehealth, as defined in section 457-2;
provided that certifying a patient for the medical use of cannabis via
telehealth shall be allowed only after an initial in-person consultation
between the certifying medical professional and patient.

PART
IV.
�
AUTHORIZED CONDUCT; PERSONAL ADULT
USE OF CANNABIS

����
�A-51
�
Personal adult use of cannabis; effective
date.
�
(a)
�
This part shall take effect on the earlier
of:

����
(1)
�
The descheduling
of marijuana under the federal Controlled Substances Act; the removal of all
federal criminal penalties for the acquisition, cultivation, dispensing,
distribution, possession, transportation, and use of marijuana by individuals
and entities; or the enactment of federal legislation that legalizes the
acquisition, cultivation, dispensing, distribution, possession, transportation,
and use of marijuana for adult use;

����
(2)
�
The enactment of
federal legislation or the issuance of a final federal judicial decision that
delegates, affirms, or recognizes the authority of states to regulate marijuana
without being preempted by federal law; or

����
(3)
�
The ratification
of an amendment to the Hawaii State Constitution legalizing cannabis.

����
(b)
�

The attorney general shall certify in writing to the governor,
administrator, president of the senate, speaker of the house of representatives,
and revisor of statutes when a condition under subsection (a) has occurred.

����
�A-52
�
Personal adult use of cannabis; protections.
�
(a)
�

Notwithstanding any other provision of law to the contrary, except as
limited by this chapter,
upon the effective date of
section A-51
, it shall be lawful for persons who are at least twenty-one
years of age to:

����
(1)
�
Smoke, ingest, or
consume adult-use cannabis;

����
(2)
�
Purchase,
transport, or possess up to one ounce of cannabis flower and up to five grams
of adult-use cannabis products as calculated using information provided
pursuant to section A-113(d);

����
(3)
�
Within a person's
private residence only, possess up to ten ounces of adult-use cannabis produced
by their personal cultivation of cannabis pursuant to section A-53; provided
that no more than two pounds of cannabis in total, whether for medical use or
personal adult use, shall be stored at any private residence, regardless of the
number of people residing there; and

����
(4)
�
Purchase, obtain,
transport, or possess cannabis accessories.

����
(b)
�

All adult-use cannabis that is dispensed by a licensed business shall be
stored in sealed, child-resistant, and resealable packaging with original
labels and shall not be easily accessible to any person under the age of twenty-one.
�
All cannabis cultivated for personal adult
use shall be stored in a manner that is not easily accessible to any person
under the age of twenty-one.

����
(c)
�

All adult-use cannabis shall be transported in a sealed container, shall
not be visible to the public, and shall not be removed from its sealed
container or consumed or used in any way while in a public place or vehicle.

����
(d)
�

For the purposes of medical care, including organ and tissue
transplants, a person's personal adult use of cannabis in compliance with this
part shall not constitute the use of an illicit substance or otherwise disqualify
a person from medical care, unless in the judgment of the health care provider
the use of cannabis increases the risk for an adverse outcome from a medical
procedure or treatment.

����
(e)
�

No person shall be denied custody, visitation, or parenting time with a
minor for conduct allowed under this part and no presumption of neglect or
child endangerment shall arise therefrom; provided that this subsection shall
not apply if the person's conduct creates a danger to the safety of the minor
as established by a preponderance of the evidence.

����
(f)
�

Except as provided in this chapter, the State and any of its political
subdivisions shall not impose any discipline upon an employee or deny an
employee any benefit or entitlement for conduct permitted under this part or
solely for the presence of cannabinoids or cannabinoid metabolites in the
urine, blood, saliva, breath, hair, or other tissue or fluid of a person who is
at least twenty-one years of age, unless the failure to do so would cause the
State or any of its political subdivisions to lose a monetary or
licensing-related benefit under a contract or federal law, or otherwise violate
federal law.
�
This subsection shall not
be construed to prohibit the State or any of its political subdivisions from:

����
(1)
�
Conducting drug
testing and using the results of those tests for the discipline of an employee
if the testing is done to comply with federal requirements or in accordance
with the applicable collective bargaining agreement or executive order; or

����
(2)
�
Disciplining
employees for being impaired by cannabis while at work.

����
�A-53
�
Personal cultivation of adult-use cannabis.
�
(a)
�

Notwithstanding any other provision of law to the contrary, except as
limited by this part, upon the effective date of section A-51, it shall be
lawful for persons who are at least twenty-one years of age to:

����
(1)
�
Possess, plant, or
cultivate no more than six living cannabis plants, whether mature or immature,
for personal adult use only; and

����
(2)
�
Harvest, dry, and
process the cannabis produced by the plants under paragraph (1) for personal
adult use only.

����
(b)
�

Personal cultivation of adult-use cannabis shall only be permitted
within, or on the grounds of, a person's private residence; provided that no
more than ten plants, whether mature or immature and whether for medical use or
for personal adult use, shall be cultivated at a private residence at any time
regardless of the number of people residing at the private residence.

����
(c)
�

Cannabis plants cultivated for personal adult use shall be kept in a
secured place not easily accessible to any person under the age of twenty-one.

����
(d)
�

Cannabis plants cultivated for personal adult use shall not be visible
to the public without the use of technology.

����
(e)
�

A landlord, condominium association, planned community association, or
similar association may limit or prohibit the personal cultivation of adult-use
cannabis through contracts, lease or rental agreements, bylaws, or rules.

����
(f)
�

The office shall adopt rules pursuant to this chapter to establish
requirements and restrictions for the personal cultivation of adult-use
cannabis, including manners in which the adult-use cannabis may be cultivated
or processed and further restrictions necessary to ensure that the personal
cultivation of adult-use cannabis is not utilized for unlicensed illicit
activity.

����
�A-54
�
Limitation; scope of personal adult use of
cannabis.
�
The authorization for the
personal adult use of cannabis in this part shall not apply to:

����
(1)
�
Any use of
cannabis that endangers the health or well‑being of another person;

����
(2)
�
Any manufacture,
distribution, dispensing, possession, or use of cannabis:

���������
(A)
�
In a school
vehicle, public transportation, or any vehicle;

���������
(B)
�
In the workplace
of one's employment;

���������
(C)
�
On any school
grounds;

���������
(D)
�
At any public
park, beach, or recreation or youth center;

���������
(E)
�
In or on any land,
facility, building, or vehicle owned, controlled, or operated by the State or
any county;

���������
(F)
�
In or on any
federal fort or arsenal, national park or forest, other federal enclave, or
other property owned, controlled, or operated by the federal government; or

���������
(G)
�
At any other place
open to the public, including smoking or vaping cannabis in public as
prohibited by chapter 328J;

���������
provided that a college or
university may authorize the use of adult-use cannabis on the grounds of or
within the college or university in accordance with this chapter; and

����
(3)
�
The use of
cannabis by anyone under the age of twenty-one.

����
�A-55
�
Cannabis accessories; authorized.
�
(a)
�

Notwithstanding any other provision of law to the contrary, it shall be
lawful for persons who are at least twenty-one years of age to manufacture,
possess, possess with intent to distribute, or purchase cannabis accessories,
or distribute or sell cannabis accessories to persons who are at least
twenty-one years of age.

����
(b)
�

This section is intended to meet the requirements of title 21 United
States Code section 863(f) by authorizing, under state law, any person in
compliance with this chapter to manufacture, possess, or distribute cannabis
accessories.

PART
V.
�
UNLAWFUL CONDUCT

����
�A-61
�
Prohibited acts; flammable solvents; criminal
offense.
�
(a)
�
No person shall intentionally or knowingly
use butane to extract cannabinoids or any compound from cannabis or hemp.

����
(b)
�

This section shall not apply to licensed businesses acting pursuant to
this chapter.

����
(c)
�

Any person who violates this section shall be guilty of a class C
felony.

����
�A-62
�
Unlawful sale of cannabis; persons under the
age of twenty-one; criminal offense.
�

(a)
�
It shall be unlawful to sell
cannabis to a person under the age of twenty-one unless that person is a
medical cannabis patient.

����
(b)
�

All persons engaged in the retail sale of cannabis, as authorized under
this chapter, shall check the government-issued photographic identification of
a cannabis purchaser to establish the age of the purchaser before the sale of
cannabis.

����
(c)
�

The fact that the defendant sold cannabis to a person under the age of
twenty-one is prima facie evidence that the defendant knew the transferee to be
a person under the age of twenty-one.

����
(d)
�

It shall be an affirmative defense to subsection (a) that the licensed
cannabis seller requested, examined, and reasonably relied upon a
government-issued photographic identification establishing the cannabis
purchaser's age as at least twenty-one years of age before selling cannabis to
the person.
�
The failure of a seller to
request and examine a government-issued photographic identification pursuant to
subsection (b) shall be construed against the seller and form a conclusive
basis for the seller's violation of subsection (a).

����
(e)
�

Any person who violates subsection (a) shall be guilty of a misdemeanor.

����
�A-63
�
Criminal offenses; records; expungement.
�
(a)
�

Records relating to the arrest, criminal charge, or conviction of a
person for an offense under chapter 329 or part IV of chapter 712, or any other
offense, the basis of which is an act permitted by this chapter or
decriminalized under Act , Session Laws of Hawaii 2026,
including the possession of marijuana, shall be ordered to be expunged in
accordance with the provisions of this section.

����
(b)
�

Upon the effective date of section A-51:

����
(1)
�
A person arrested
for or charged with an offense under chapter 329 or part IV of chapter 712, or
any other offense, the basis of which is an act permitted by this chapter or
decriminalized under Act , Session Laws of Hawaii 2026,
including the possession or distribution of marijuana, shall have the right to
petition the attorney general, at any time and without limitation to the number
of petitions a person may file, for the expungement of the person's records
relating to the arrest or criminal charge pursuant to procedures established by
the attorney general; and

����
(2)
�
A person convicted
for an offense under chapter 329 or part IV of chapter 712, or any other
offense, the basis of which is an act permitted by this chapter or
decriminalized under Act , Session Laws of Hawaii 2026, shall
have the right to petition the appropriate court of record, at any time and
without limitation to the number of petitions a person may file, for the
expungement of the person's records relating to the conviction and review and
adjustment of the person's sentence pursuant to procedures established by the
judiciary.

PART
VI.
�
CANNABIS BUSINESSES AND HEMP
BUSINESSES; GENERAL

����
�A-71
�
Cannabis business; hemp business; authorized.
�
(a)
�

Notwithstanding any law to the contrary, a cannabis business or hemp
business may operate only as authorized by this chapter.

����
(b)
�

No person shall operate a cannabis business or hemp business unless that
person holds a valid license or permit issued by the office pursuant to this
chapter or rules adopted pursuant to this chapter; provided that a hemp
cultivator shall hold a valid license to produce hemp issued by the United
States Secretary of Agriculture and be in compliance with section A-132.

����
(c)
�

Each license or permit issued by the office to a cannabis business or
hemp business shall be separate and distinct from any other license or permit
issued to the same cannabis business or hemp business pursuant to this chapter
or rules adopted pursuant to this chapter.

����
(d)
�

In addition to any other penalties allowed by law, operating a cannabis
business, including distributing, selling, or offering for sale a restricted
cannabinoid product, or a hemp business without a valid license or permit
issued by the office pursuant to this chapter or rules adopted pursuant to this
chapter shall constitute an unfair method of competition and unfair or
deceptive act or practice pursuant to section 480-2 and shall be subject to a
civil penalty as provided in section 480-3.1.
�

Each package of cannabis or restricted cannabinoid product sold in
violation of this part shall constitute a separate violation.

����
�A-72
�
Applicant criteria.
�
(a)
�
An
applicant for a license under this chapter shall meet each of the criteria in
this section, if applicable.

����
(b)
�

If the applicant is a natural person, the applicant shall establish at a
minimum that the applicant:

����
(1)
�
Is at least
twenty-one years of age;

����
(2)
�
Has been a legal
resident of the State for no less than five years preceding the date of
application; provided that this paragraph shall not apply to an applicant for a
license pursuant to part VIII;

����
(3)
�
Has a Hawaii tax
identification number and is compliant with the tax laws of the State;

����
(4)
�
Has not been
convicted of a felony; provided that a conviction:

���������
(A)
�
That is pardoned
or expunged;

���������
(B)
�
That resulted in a
term of probation, incarceration, or supervised release that was completed more
than ten years preceding the date of application; or

���������
(C)
�
Solely for a marijuana-related
offense, unless the offense involved a minor, including the offense under
section 712-1249.6; involved a firearm, including the offense under section
134-7(b); or was committed after, or within one year before, July 1, 2026,

���������
shall not disqualify a person
from applying for a license; and

����
(5)
�
Has not had any
license, permit, certificate, registration, or other government-issued
authorization related to cannabis or hemp revoked in any jurisdiction.

����
(c)
�

If the applicant is a business entity, the applying business entity
shall establish at a minimum that:

����
(1)
�
Every officer,
director, manager, and general partner of the applying business entity or any
person who has the power to direct the management, policies, and practices of
the applying business entity:

���������
(A)
�
Is at least
twenty-one years of age;

���������
(B)
�
Is a natural
person who has been a legal resident of the State for no less than five years
preceding the date of application; provided that this subparagraph shall not
apply to an applicant for a license pursuant to part VIII or a medical cannabis
dispensary that converted the dispensary's operation into licenses under this
chapter pursuant to section 45 of Act , Session Laws of
Hawaii 2026;

���������
(C)
�
Has not been
convicted of a felony; provided that a conviction:

��������������
(i)
�
That is pardoned
or expunged;

�������������
(ii)
�
That resulted in a
term of probation, incarceration, or supervised release that was completed more
than ten years preceding the date of application; or

������������
(iii)
�
Solely for a marijuana-related
offense, unless the offense involved a minor, including the offense under
section 712‑1249.6; involved a firearm, including the offense under
section 134-7(b); or was committed after, or within one year before, July 1,
2026,

��������������
shall not disqualify a
person from applying for a license; and

���������
(D)
�
Has not had any
license, permit, certificate, registration, or other government-issued
authorization related to cannabis or hemp revoked in any jurisdiction; and

����
(2)
�
The applying
business entity:

���������
(A)
�
Is controlled by a
majority of the shares, membership interests, partnership interests, or other
equity ownership interests that is held or owned by natural persons who are
legal residents of the State or by business entities whose owners are all
natural persons who are legal residents of the State; provided that this
subparagraph shall not apply to an applicant for a license pursuant to part
VIII or a medical cannabis dispensary that converted the dispensary's operation
into licenses under this chapter pursuant to section 45 of Act ,
Session Laws of Hawaii 2026;

���������
(B)
�
Has been organized
under the laws of the State;

���������
(C)
�
Has a Hawaii tax
identification number and is compliant with the tax laws of the State;

���������
(D)
�
Has a department
of commerce and consumer affairs business registration number and suffix; and

���������
(E)
�
Has a federal
employer identification number.

����
(d)
�

An applicant shall disclose in or include with its application the names
and addresses of the applicant and all persons having a direct or indirect
financial interest in the applied-for license and the nature and extent of the
financial interest held by each person and the nature and extent of any
financial interest the person has in any other license applied for or issued
under this chapter.

����
(e)
�

An applicant shall complete all application forms prescribed by the
office fully and truthfully and comply with all information requests by the
office relating to the license application.

����
(f)
�

A license shall be denied or revoked if an applicant knowingly or
recklessly makes any false statement of material fact to the office in applying
for a license under this chapter.

����
(g)
�

The office may adopt rules to require additional criteria for licensure
for the purposes of protecting public health and safety, promoting
sustainability and agriculture, and encouraging the full participation in the
regulated cannabis industry from disproportionately impacted areas.

����
(h)
�

For purposes of this section, "sustainability" has the same
meaning as in section 226-2.

����
�A-73
�
Ownership restrictions.
�
No person shall be issued or have any direct
or indirect interest in more than three licenses for each class of license, and
no more than nine licenses in total; provided that a medical cannabis
dispensary that converted the dispensary's operation into licenses under this
chapter pursuant to section 45 of Act , Session Laws of
Hawaii 2026, may be issued up to three cannabis cultivator licenses, three
cannabis processor licenses, four medical cannabis dispensary licenses, and
four retail cannabis store licenses, but no more than ten licenses in total;
provided further that no person:

����
(1)
�
Holding a license
pursuant to this chapter, or having a direct or indirect interest in a cannabis
cultivator, cannabis processor, hemp cultivator, hemp extract processor,
medical cannabis dispensary, or retail cannabis store, shall be issued a
license for, or have any direct or indirect interest in, an independent
laboratory or a craft cannabis dispensary;

����
(2)
�
Holding a license
for, or having a direct or indirect interest in, an independent laboratory
shall be issued a license for, or have any direct or indirect interest in, any
other licensed business authorized under this chapter or rules adopted pursuant
to this chapter; and

����
(3)
�
Holding a license
for, or having a direct or indirect interest in, a craft cannabis dispensary
shall be issued a license for, or have any direct or indirect interest in, any
other licensed business authorized under this chapter or rules adopted pursuant
to this chapter.

����
�A-74
�
Criminal history background check.
�
(a)
�

The following shall be subject to background checks conducted by the
office or its designee, which may include criminal history record checks in
accordance with section 846-2.7:

����
(1)
�
Each applicant for
a license or permit, including every officer, director, manager, and general
partner of an applying business entity or any person who has the power to
direct the management, policies, and practices of the applying business entity;

����
(2)
�
Each current or
prospective employee of a licensed business;

����
(3)
�
Each current or
prospective contractor of a licensed business; and

����
(4)
�
Each current or
prospective laboratory agent of an independent laboratory.

����
(b)
�

A person who is required to undergo a background check shall provide
written consent and all applicable processing fees to the office or its
designee to conduct the background check.

����
�A-75
�
License; application; approval; denial;
appeal.
�
(a)
�
The office shall adopt rules to establish
procedures for licensure application, review, approval, and denial, including
an application fee for each license.

����
(b)
�

The office shall set an open application period for each available
license.
�
The office shall not accept an
application outside the open application period.

����
(c)
�

The office shall publish a notice of the open application period on its
website no less than thirty calendar days before the start of the application
period.
�
The notice shall contain:

����
(1)
�
The class or
classes of licenses available;

����
(2)
�
The number of
licenses available for each class of license;

����
(3)
�
The application
criteria for each class of license available; and

����
(4)
�
The procedure to
select applications for approval from among the applicants that meet the
criteria required for each class of license available.

����
(d)
�

The office shall review and investigate whether the information
submitted in the application is complete and valid and meets the criteria
required pursuant to this chapter and rules adopted pursuant to this chapter,
and whether the applicant is otherwise disqualified pursuant to this chapter or
rules adopted pursuant to this chapter.

����
(e)
�

If an application form is incomplete or invalid, the office may request
additional information or documentation; provided that if an applicant fails to
cure an incomplete or invalid application within a timeframe prescribed by the
office, the application shall be deemed withdrawn, and the application fee
shall be forfeited to the office.

����
(f)
�

The office shall approve or deny the applications in accordance with
this chapter and rules adopted pursuant to this chapter; provided that the
office may deny an application that meets all of the criteria required for a
license if the application was not selected to be approved pursuant to the
selection procedure published in the notice pursuant to subsection (c).

����
(g)
�

Upon the office's determination to deny a license application, the
office shall notify the applicant in writing of the denial and the basis for
the denial.

����
(h)
�

Any person aggrieved by the office's denial of a license application may
request a contested case hearing pursuant to chapter 91.
�
To request a contested case hearing, the person
shall submit a written request to the office within thirty calendar days of the
date of the written notice of denial.
�

Appeal to the circuit court under section 91-14, or any other applicable
statute, shall only be taken from the office's final order pursuant to a
contested case.

����
�A-76
�
License term; renewal.
�
(a)
�

All licenses under this chapter shall be effective for one year from the
date of issuance and may be renewed annually pursuant to this section.
�
The office shall adopt rules to set forth
procedures and requirements for the submission, processing, and approval of a
renewal application, including a renewal application fee.

����
(b)
�

An applicant for renewal shall submit to the office information, on the
form prescribed by the office, and documentation necessary to verify that the
applicant continues to meet the criteria required pursuant to this chapter and
rules adopted pursuant to this chapter and is in compliance with all the
requirements pursuant to this chapter and rules adopted pursuant to this
chapter, including compliance with chapter B and all other laws governing
entities doing business in the State, including chapters 237, 383, 386, 392,
and 393.

����
(c)
�

In addition to the review and verification of the information and
documentation submitted by the applicant, the office shall conduct an
unannounced inspection of the applicant to verify compliance as required by
subsection (b).

����
(d)
�

Upon submission of the renewal application fee and verification that the
applicant meets the requirements under subsection (b), the office may renew the
applicant's license.

����
(e)
�

If the office determines that the applicant is disqualified for renewal
for any reason, the office shall notify the applicant in writing of the denial
and the basis for the denial or, if held for further action, the conditions for
approval.
�
The failure to meet the
conditions set by the office shall result in denial of the renewal application.

����
(f)
�

Any person aggrieved by the office's denial of license renewal may
request a contested case hearing pursuant to chapter 91.
�
To request a contested case hearing, the
person shall submit a written request to the office within thirty calendar days
of the date of the written notice of denial.
�

Appeal to the circuit court under section 91-14, or any other applicable
statute, shall only be taken from the office's final order pursuant to a
contested case.

����
(g)
�

A licensee that files a renewal application and pays all required fees
under this section before the expiration of the license may continue to operate
under that license notwithstanding its expiration until the office takes final
action on the renewal application, unless the office suspends or revokes the
license before taking final action on the renewal application.

����
(h)
�

Except as provided in subsection (g), upon expiration of a license, the
licensed business shall immediately cease all activities previously authorized
by the license and ensure that all cannabis in the licensed business's
possession is forfeited to the office for destruction pursuant to section A-92.

����
�A-77
�
Transfer of ownership; structural
reorganization; restructuring.
�

(a)
�
A licensed business shall not
sell or otherwise transfer any license issued under this chapter to another
person, reorganize its ownership structure, or restructure its business entity,
unless otherwise authorized under this section.

����
(b)
�

The office shall adopt rules to establish procedures and requirements
for the submission of a license transfer, reorganization, or restructuring
application and standards for the approval or denial of the application.

����
(c)
�

A licensed business may apply to the office, on the form prescribed by
the office, for approval to transfer ownership interests in the license,
reorganize its ownership structure, or restructure its business entity.

����
(d)
�

A person seeking to assume an ownership interest in the licensed
business, a new proposed officer, director, manager, or general partner of the
licensed business, or anyone who seeks to assume any power to directly or
indirectly control the management, policies, and practices of the licensed
business shall demonstrate that the person meets all applicable criteria and
requirements for licensure pursuant to this chapter and rules adopted pursuant
to this chapter, including the background checks and ownership restrictions.

����
(e)
�

Any license transfer, reorganization, or restructuring done without
office approval, or that results in a violation of the ownership restrictions
pursuant to section A-73, shall be void and the license shall be subject to
immediate revocation.

����
�A-78
�
Fees; disposition of fees.
�
All fees charged pursuant to this chapter or
rules adopted pursuant to this chapter shall be paid to the office in the form
required by the office.
�
All fees
collected under this chapter or rules adopted pursuant to this chapter shall be
deposited in the cannabis regulation and enforcement special fund established
in section A-16.

����
�A-79
�
Licensed business operations.
�
(a)
�

The office shall adopt rules to establish requirements for the operation
of a licensed business.

����
(b)
�

In addition to requirements established by any other provision of this
chapter and rules adopted pursuant to this chapter, a licensed business shall
secure:

����
(1)
�
Every entrance to
the restricted areas of the licensed premises so that access to restricted
areas is restricted to employees and others permitted by law to access the
restricted area; and

����
(2)
�
The business's
inventory and equipment during and after operating hours to deter and prevent
theft of cannabis.

����
(c)
�

No licensed business shall cultivate, process, store, or test cannabis
at any location other than within an area that is enclosed and secured in a
manner that prevents access by persons not authorized to access the restricted
area.
�
A greenhouse or outdoor cannabis
cultivation area shall have sufficient security measures to demonstrate that
outdoor areas are not readily accessible by unauthorized individuals, including
perimeter security fencing designed to prevent unauthorized entry.

����
(d)
�

No licensed business shall refuse employees or agents of the office the
right at any time of operation to inspect the entire licensed premises or to
audit the books, papers, and records of the licensed business.

����
(e)
�

No licensed business shall allow any person under the age of twenty-one
to work for the licensed business.

����
(f)
�

No licensed business shall allow any person that has been convicted of a
felony to work for the licensed business; provided that a conviction:

����
(1)
�
That is pardoned
or expunged;

����
(2)
�
That resulted in a
term of probation, incarceration, or supervised release that was completed more
than ten years preceding the date the person begins employment; or

����
(3)
�
Solely for a
marijuana-related offense, unless the offense involved a minor, including the
offense under section 712-1249.6; involved a firearm, including the offense
under section 134-7(b); or was committed after, or within one year before, July
1, 2026,

shall not disqualify a person from working for the
licensed business.

����
(g)
�

A licensed business shall:

����
(1)
�
Register each
employee with the office; and

����
(2)
�
Notify the office
within one business day if an employee ceases to be associated with the
licensed business.

����
(h)
�

A person under the age of twenty-one shall not enter a licensed
business; provided that a medical cannabis patient who is at least eighteen
years of age may enter a medical cannabis dispensary or retail cannabis store.

����
(i)
�

A licensed business shall ensure that unauthorized persons under the age
of twenty-one do not enter the licensed premises; provided that the office may
adopt rules to allow a medical cannabis dispensary or retail cannabis store to
use a controlled, indoor entry area in the medical cannabis dispensary or
retail cannabis store to verify the identification and age of persons before
allowing access beyond the entry area.

����
(j)
�

No licensed business shall cultivate, process, distribute, dispense, or
otherwise transact business with any products containing cannabis other than
those that were cultivated, processed, distributed, dispensed, transacted, and
taxed in accordance with this chapter and chapter B.

����
�A-80
�
Licensed premises; where.
�
(a)
�

Each license issued under this chapter shall authorize the operation of
the licensed business only at the single place described in the license.

����
(b)
�

Licensed premises shall not be located within a seven hundred fifty foot
radius of an existing school, public park, or public housing project or
complex.

����
�A-81
�
Laboratory standards and testing.
�
(a)
�
No
person or licensed business shall distribute, dispense, or otherwise sell
cannabis or hemp unless the cannabis or hemp has been tested and shown to meet
the requirements and standards established under this chapter and rules adopted
pursuant to this chapter for content, contamination, and consistency.

����
(b)
�

The office shall adopt rules to establish requirements and standards for
the mandatory laboratory testing of cannabis and hemp that conform with the
best practices generally used within the cannabis industry, including:

����
(1)
�
The processes,
protocols, and standards regarding the collection of samples of cannabis and
hemp;

����
(2)
�
Mandatory
laboratory testing for cannabis flower and hemp flower that shall include
testing for:

���������
(A)
�
Dangerous molds
and mildew;

���������
(B)
�
Harmful microbes,
including Escherichia coli and Salmonella;

���������
(C)
�
Pesticides,
fungicides, and insecticides; and

���������
(D)
�
Tetrahydrocannabinol
potency, homogeneity, and cannabinoid profiles to ensure correct labeling;

����
(3)
�
Mandatory
laboratory testing for cannabis products and hemp extract products, except for
crude hemp extract, that shall include testing for:

���������
(A)
�
Dangerous molds
and mildew;

���������
(B)
�
Harmful chemicals;

���������
(C)
�
Harmful microbes,
including Escherichia coli and Salmonella;

���������
(D)
�
Pesticides,
fungicides, and insecticides;

���������
(E)
�
Residual solvents,
poisons, and toxins; and

���������
(F)
�
Tetrahydrocannabinol
potency, homogeneity, and cannabinoid profiles to ensure correct labeling; and

����
(4)
�
Mandatory
laboratory testing for crude hemp extract that shall include testing for:

���������
(A)
�
Residual solvents,
poisons, and toxins; and

���������
(B)
�
Tetrahydrocannabinol
potency, homogeneity, and cannabinoid profiles to ensure correct labeling.

����
(c)
�

A licensed business shall maintain a record of all laboratory testing
that includes a description of the cannabis or hemp provided to the independent
laboratory, the identity of the independent laboratory, and the results of the
test.

����
(d)
�

The office may adopt rules to establish other quality assurance
mechanisms that may include the designation or creation of a state cannabis
testing facility, creation of a secret shopper program, round-robin testing, or
any other mechanism to ensure the accuracy of product testing and labeling.

����
�A-82
�
Packaging.
�
(a)
�
No
cannabis or hemp shall be distributed, dispensed, or otherwise sold unless it
is packaged in accordance with this chapter and rules adopted pursuant to this
chapter.

����
(b)
�

The office shall adopt rules to establish requirements for the packaging
of cannabis and hemp; provided that the rules for the packaging of cannabis
shall:

����
(1)
�
Require the
packaging to be opaque and certified child-resistant and resealable;

����
(2)
�
Restrict packaging
containing cannabis for medical use to black lettering on a white background
with no pictures or graphics;

����
(3)
�
Restrict packaging
containing cannabis for personal adult use to black lettering on a background
of a singular, solid color approved by the office with no pictures or graphics;

����
(4)
�
Restrict the use
of colors, pictures, graphics, or designs on or inside packaging to ensure that
packaging is not designed to appeal particularly to a person under the age of
twenty-one;

����
(5)
�
Require the
division of each serving within a package containing multiple servings in a
manner that allows consumers and medical cannabis patients to easily identify a
single serving; and

����
(6)
�
Prohibit packaging
that imitates or resembles any existing branded consumer products, including
foods and beverages, that do not contain cannabis.

����
(c)
�

No licensed business shall offer, at no cost or at cost, any packaging
that does not meet the requirements under this chapter and rules adopted
pursuant to this chapter.

����
�A-83
�
Labeling.
�

(a)
�
No cannabis or hemp shall be
distributed, dispensed, or otherwise sold unless it is labeled in accordance
with this chapter and rules adopted pursuant to this chapter.

����
(b)
�

The office shall adopt rules to establish labeling requirements for
cannabis and hemp; provided that labeling on each cannabis package shall, at a
minimum, contain:

����
(1)
�
A universal
cannabinoid product symbol that has been approved as a consensus standard
issued by a nationally recognized consensus standard organization;

����
(2)
�
The name and
contact information of the cannabis cultivator or cannabis processor who
produced the cannabis;

����
(3)
�
The results of
sampling, testing, and analysis conducted by an independent laboratory;

����
(4)
�
A list of
pharmacologically active ingredients and possible allergens;

����
(5)
�
The number of
servings in the package if there are multiple servings;

����
(6)
�
The amount of
cannabinoids in the package and in each serving as expressed in absolute terms
and as a percentage of volume;

����
(7)
�
The appellation of
origin;

����
(8)
�
If the product is
medical cannabis, the statement "For medical use only"; and

����
(9)
�
The following
statement in bold print, including capitalization:
�
"This product has not been analyzed or
approved by the United States Food and Drug Administration.
�
There is limited information on the side
effects of using this product, and there may be associated health risks.
�
Cannabis use during pregnancy and
breastfeeding may pose potential harms. It is against the law to drive when
under the influence of this product.
�

KEEP THIS PRODUCT AWAY FROM CHILDREN.".

����
�A-84
�
Cannabis and cannabis product standards.
�
(a)
�

The office shall adopt rules to establish requirements, restrictions,
and standards regarding the types, ingredients, and designs of cannabis,
including potency limits and limits on servings per package; provided that each
cannabis product shall be registered with the office on forms prescribed by the
office.

����
(b)
�

Edible cannabis products shall not be designed to resemble commercially
available candy or other products marketed to children.
�
The words "candy" and "candies"
shall not be used on packaging, labeling, advertising, product lists, or
product menus.
�
Edible cannabis products
shall not be in the shape of or contain a depiction of a human, animal, or
fruit, or a shape or depiction that bears the likeness or contains
characteristics of a realistic or fictional human, animal, or fruit, including
artistic, caricature, or cartoon renderings.

����
(c)
�

Except for a cannabis product intended for external topical application
to the skin or hair, no person shall distribute, dispense, sell, or offer for
sale any cannabis product intended to be introduced via non-oral routes of
entry to the body, including use in the eyes, ears, or nasal cavities.

����
�A-85
�
Informational materials.
�
(a)
�

The office, in consultation with the department of health, shall design
at least two versions of an informational handout, one of which is specific to
high potency products.

����
(b)
�

A cannabis business selling directly to consumers shall include an
informational handout designed by the office pursuant to subsection (a) with
all cannabis sold to consumers; provided that the cannabis business shall
include the high potency version in any sale involving a cannabis concentrate
or other high potency product.
�
The
informational handouts shall include scientifically accurate information,
including:

����
(1)
�
Advice about the
potential risks of cannabis, and, in the case of the high potency handout,
risks specific to high potency products, including:

���������
(A)
�
The risks of
driving under the influence of cannabis, and the fact that doing so is illegal;

���������
(B)
�
Any adverse
effects unique to adolescents or young adults, including effects related to the
developing mind;

���������
(C)
�
Potential adverse
events and other risks, including those related to mental health; and

���������
(D)
�
The risks of using
cannabis during pregnancy or breastfeeding;

����
(2)
�
Information about
the methods for administering cannabis;

����
(3)
�
How long cannabis
may impair a person after it is ingested in each manner;

����
(4)
�
How to recognize
cannabis use disorder and how to obtain appropriate services or treatment;

����
(5)
�
Information
regarding safe storage and disposal of cannabis and cannabis accessories to
prevent accidental poisonings, including the contact information for a poison
control center; and

����
(6)
�
Subject to federal
laws, regulations, policies, guidance, or judicial decisions, a disclosure
regarding:

���������
(A)
�
The status of
cannabis under federal law; and

���������
(B)
�
Potential
implications for users of cannabis, including as it relates to firearms,
employment, housing, or other federal benefits or services.

����
�A-86
�
Advertising; marketing; branding.
�
(a)
�

The office shall adopt rules to establish requirements for the
advertising, marketing, and branding of cannabis, hemp, and any licensed
business, that include at a minimum:

����
(1)
�
A prohibition on
advertising, marketing, and branding in a manner that is deemed to be
deceptive, false, or misleading;

����
(2)
�
A prohibition or
restriction on advertising, marketing, and branding through or on a certain
medium, method, or location, as determined by the office, to minimize
advertising, marketing, and brand exposure of licensed businesses to a person
under the age of twenty-one;

����
(3)
�
A prohibition on
advertising, marketing, and branding that utilizes statements, designs,
representations, pictures, or illustrations that portray anyone under the age
of twenty-one;

����
(4)
�
A prohibition on
advertising, marketing, and branding, including mascots, cartoons, candies,
toys, fruits, brand sponsorships, and celebrity endorsements, that is deemed to
appeal to a person under the age of twenty-one;

����
(5)
�
A prohibition on
advertising, marketing, and branding, including statements by a licensed
business, that makes any false or misleading statements concerning other
licensed businesses and the conduct and products of the other licensed
businesses;

����
(6)
�
A prohibition on
advertising, marketing, and branding through certain identified promotional
items as determined by the office, including giveaways, coupons, samples,
prizes, or "free", "donated", or "premium"
cannabis or restricted cannabinoid products;

����
(7)
�
A prohibition on
advertising, marketing, and branding by a licensed business that asserts its
products are safe, other than labeling required pursuant to this chapter or
rules adopted pursuant to this chapter;

����
(8)
�
A reasonable
restriction on timing and use of illuminated external signage, which shall
comply with any other applicable provisions of law, including local ordinances
and requirements, and a prohibition on neon signage;

����
(9)
�
A requirement that
any website or social media account of a licensed business verify that the
entrant is at least twenty-one years of age;

���
(10)
�
A prohibition on
the use of unsolicited pop-up advertisements on the Internet;

���
(11)
�
A requirement that
all advertising, marketing, and branding materials for cannabis or hemp contain
a standard health warning developed by the office in consultation with the
department of health; and

���
(12)
�
A requirement that
all advertising, marketing, and branding materials for cannabis accurately and
legibly identify the licensed business responsible for its content, by adding,
at a minimum, the licensed business's name and license number.

����
(b)
�

No person, other than the holder of a license or permit issued pursuant
to this chapter or rules adopted pursuant to this chapter or a person who
provides professional services related to a licensed business, shall advertise
any cannabis or services related to cannabis in the State.

����
(c)
�

No person shall place or maintain, or cause to be placed or maintained,
any sign or other advertisement for a business or product related to cannabis,
in any form or through any medium whatsoever, within seven hundred fifty feet
of the real property comprising of a school, public park, or public housing
project or complex.

����
�A-87
�
Signage.
�

The office shall adopt rules to establish requirements for signage at
the licensed premises that shall, at a minimum, require that:

����
(1)
�
All cannabis
businesses that are open to the public conspicuously post a notice at each
entry to all licensed premises that persons under the age of twenty-one are not
allowed on the licensed premises unless they are a medical cannabis patient who
is at least eighteen years of age;

����
(2)
�
All cannabis
businesses that are open to the public conspicuously post a sign in or about
the licensed premises notifying all customers and other persons of the dangers
of, and possible sanctions that may be imposed for, operating a vehicle under
the influence of cannabis;

����
(3)
�
If applicable under
current
federal laws, regulations, policies, guidance, or judicial
decisions, all cannabis businesses that are open to the public conspicuously
post a sign in or about the licensed premises notifying all customers and other
persons that the possession and sale of cannabis is illegal under federal law
and a person is subject to federal laws, regulations, policies, guidance, and
judicial decisions while traveling interisland; and

����
(4)
�
Every license and
permit issued and in effect under this chapter shall at all times be
conspicuously posted to view, convenient for inspection, on the licensed
premises.

����
�A-88
�
Seed-to-sale tracking system.
�
(a)
�

The office shall establish, maintain, and control a seed-to-sale
tracking system that shall have real-time, twenty-four-hour access to the data
of all cannabis businesses.
�
The office
shall adopt rules pursuant to this chapter to establish procedures and
requirements for the seed-to-sale tracking system.

����
(b)
�

The seed-to-sale tracking system shall collect data, including:

����
(1)
�
The total amount
of cannabis possessed by all cannabis businesses from either the seed or
immature plant state, including all plants that are derived from cuttings or
cloning, until the cannabis is sampled, dispensed, or destroyed;

����
(2)
�
The total inventory
of cannabis products and medical cannabis products, as applicable, including
the equivalent physical weight of cannabis that is used to produce the
products;

����
(3)
�
The amount of
waste produced by each plant at harvest; and

����
(4)
�
The transport of
cannabis between cannabis businesses, including tracking the quantity and type
of cannabis, the identity of the person transporting the cannabis, and the
make, model, and license number of the vehicle being used for the transport.

����
(c)
�

The procurement of the seed-to-sale tracking system established pursuant
to this section shall be exempt from chapter 103D; provided that:

����
(1)
�
The office shall
publicly solicit at least three proposals for the seed-to-sale tracking system;
and

����
(2)
�
The selection of
the seed-to-sale tracking system shall be approved by the administrator.

����
(d)
�

Notwithstanding any other provision of this section to the contrary, if
the office's seed-to-sale tracking system is inoperable, as an alternative to
requiring a cannabis business to temporarily cease operations, the office may
implement an alternate tracking system that will enable a cannabis business to
operate on a temporary basis.

����
(e)
�

A cannabis business shall purchase, operate, and maintain a computer
software tracking system that shall interface with the office's seed-to-sale
tracking system established pursuant to subsection (a) and allow each cannabis
business to submit to the office any required data.

����
�A-89
�
Violations; penalties.
�
(a)
�
In
addition to any other penalties allowed by law, any person who violates this
chapter or rules adopted pursuant to this chapter shall be fined no more than
$1,000 for each separate violation.
�

Unless otherwise provided by applicable law, each day on which a
violation occurs or continues shall be counted as a separate violation.

����
(b)
�

Upon the office's determination to impose an administrative penalty on a
person pursuant to subsection (a), the office shall provide the person with
written notice of the administrative penalty and the basis for the
administrative penalty.
�
Any notice of an
administrative penalty may be accompanied by a cease-and-desist order or
corrective action order.
�
The violation
of the cease-and-desist order or corrective action order shall constitute a
further violation of this chapter.

����
(c)
�

Any person aggrieved by the imposition of an administrative penalty may
request a contested case hearing pursuant to chapter 91.
�
To request a contested case hearing, the person
shall submit a written request to the office within thirty calendar days of the
date of the written notice.
�
Appeal to
the circuit court under section 91-14, or any other applicable statute, shall
only be taken from the office's final order pursuant to a contested case.

����
(d)
�

Any action taken to recover, collect, or enforce the penalty provided
for in this section shall be considered a civil action.
�
For any judicial proceeding to recover or
collect an administrative penalty imposed pursuant to subsection (a) or to
enforce a cease-and-desist order or corrective action order issued pursuant to
subsection (b), the office may petition any court of appropriate jurisdiction
and need only show that:

����
(1)
�
Notice was given;

����
(2)
�
A hearing was
held, or the time granted for requesting a hearing has expired without a
request;

����
(3)
�
The administrative
penalty, cease-and-desist order, or corrective action order was imposed on the
person; and

����
(4)
�
The penalty
remains unpaid, or the order was not complied with.

����
(e)
�

All monetary penalties imposed pursuant to this chapter shall be paid by
the person to the office in the form required by the office.
�
All monetary penalties paid to the office
pursuant to this chapter shall be deposited into the cannabis regulation and
enforcement special fund established in section A-16.

����
�A-90
�
License; permit; suspension; revocation.
�
(a)
�
In
addition to any other actions authorized by law, the office may suspend or
revoke any license or permit issued by the office for violations of this
chapter, the rules adopted pursuant to this chapter, or chapter B, or for any
good cause, including:

����
(1)
�
Procuring a
license or permit through fraud, misrepresentation, or deceit;

����
(2)
�
Professional
misconduct, gross carelessness, or manifest incapacity;

����
(3)
�
False, fraudulent,
or deceptive advertising;

����
(4)
�
Any other conduct
constituting fraudulent or dishonest dealings;

����
(5)
�
Failure to comply
with an order from the office; and

����
(6)
�
Making a false
statement on any document submitted or required to be filed by this chapter,
including furnishing false or fraudulent material information in any
application.

����
(b)
�

The office shall adopt rules to establish procedures and standards for
the suspension and revocation of a license or permit.

����
(c)
�

If the office determines that conduct by a licensed business warrants
suspension or revocation, the office shall provide the licensed business with a
written notice and order describing the basis for the suspension or revocation.

����
(d)
�

Any person aggrieved by the office's suspension or revocation
determination may request a contested case hearing pursuant to chapter 91.
�
To request a contested case hearing, the
person shall submit a written request to the office within thirty calendar days
of the date of the written notice and order of the suspension or
revocation.
�
Appeal to the circuit court
under section 91-14, or any other applicable statute, shall only be taken from
the office's final order pursuant to a contested case.

����
(e)
�

A licensed business whose license or permit has been suspended shall
not, for the duration of the period of suspension, engage in any activities
relating to the operation of the licensed business, including:

����
(1)
�
Distributing,
dispensing, selling, transferring, transporting, or otherwise disposing of any
cannabis or hemp owned by or in the possession of the licensed business; or

����
(2)
�
Processing any
cannabis or hemp.

����
(f)
�

A person whose license or permit has been revoked shall immediately
cease all activities relating to the operation of the licensed business and
ensure that all cannabis or hemp owned by or in the possession of the person
pursuant to that license or permit is forfeited to the office for destruction
pursuant to section A-92.

����
(g)
�

If any license or permit is revoked or otherwise terminated by the
office, any fees paid for the license or permit shall be forfeited to the
State.

����
�A-91
�
Relinquishment no bar to jurisdiction.
�
The forfeiture, nonrenewal, surrender,
voluntary relinquishment, or abandonment of a license or permit issued by the
office under this chapter or rules adopted pursuant to this chapter shall not
bar jurisdiction by the office to proceed with any investigation, action, or
proceeding to restrict, condition, limit, suspend, or revoke the license or
permit, or otherwise penalize a licensed business or an individual licensee or
permittee, or both.

����
�A-92
�
Forfeiture; destruction.
�
(a)
�
In
addition to any other actions authorized by law, the office may order the
forfeiture and destruction of all or a portion of the cannabis or hemp, owned
by or in the possession of a licensed business, if it makes a determination
that the cannabis or hemp is not authorized by, or is in violation of, this
chapter or rules adopted pursuant to this chapter.

����
(b)
�

The office shall adopt rules to establish procedures and standards for
the forfeiture and destruction of cannabis or hemp.

����
(c)
�

If the office determines that a violation by a licensed business
warrants forfeiture and destruction of all or a portion of the cannabis or hemp
owned by or in the possession of that licensed business, the office shall
provide the licensed business with a written notice and order describing the
basis for the forfeiture and destruction, a description of the cannabis or hemp
subject to forfeiture and destruction, and a timeframe in which the cannabis or
hemp must be forfeited.

����
(d)
�

A licensed business subject to an order directing the destruction of any
cannabis or hemp owned by or in the possession of the licensed business shall
forfeit the cannabis or hemp described in the order to the office for
destruction within the timeframe described in the order.

����
(e)
�

Any person aggrieved by the office's forfeiture and destruction
determination may request a contested case hearing pursuant to chapter 91.
�
To request a contested case hearing, the
person shall submit a written request to the office within thirty calendar days
of the date of the written notice and order of forfeiture and destruction.
�
Appeal to the circuit court under section
91-14, or any other applicable statute, shall only be taken from the office's
final order pursuant to a contested case.

����
(f)
�

If the office is notified by a law enforcement agency that there is a
pending investigation of a licensed business subject to an order for forfeiture
and destruction of cannabis or hemp, the office shall not destroy any cannabis
or hemp of that licensed business until the destruction is approved by the law
enforcement agency.

����
�A-93
�
Administrative holds.
�
(a)
�
In
addition to any other actions authorized by law, the office may impose an
administrative hold on a licensed business if there are reasonable grounds to
believe the licensed business has committed or is committing a violation of
this chapter or rules adopted pursuant to this chapter.

����
(b)
�

The office shall provide a licensed business subject to an
administrative hold with written notice of the imposition of that hold, which
shall:

����
(1)
�
Include a
statement of the basis for the administrative hold;

����
(2)
�
Detail the
cannabis or hemp subject to the administrative hold;

����
(3)
�
Describe any
operational restrictions to be placed on the licensed business during the duration
of the administrative hold; and

����
(4)
�
Indicate actions
that must be taken by the licensed business as a result of the administrative
hold.

����
(c)
�

An administrative hold shall take effect at the time that the written
notice is provided to the licensed business.

����
(d)
�

A licensed business subject to an administrative hold shall physically
segregate, in a limited access area approved by the office, any cannabis or
hemp subject to the administrative hold from any other cannabis or hemp not
subject to the administrative hold.

����
(e)
�

For the duration of the administrative hold, the licensed business shall
not sell, transfer, transport, distribute, dispense, dispose of, or destroy any
cannabis or hemp subject to the administrative hold, but may, as applicable,
cultivate or otherwise maintain any cannabis plants or hemp plants subject to
the administrative hold unless specifically restricted by the office.

����
(f)
�

A licensed business subject to an administrative hold, for the duration
of the administrative hold, shall maintain the licensed premises and may
otherwise continue to operate the licensed business in compliance with this
chapter, rules adopted pursuant to this chapter, and the provisions of the
administrative hold.
�
Except as
specifically restricted by the office, the licensed business may, for the
duration of the administrative hold, cultivate, process, distribute, or
dispense any cannabis or hemp not subject to the administrative hold pursuant
to its license or permit.

����
(g)
�

The office may terminate an administrative hold at any time following
the imposition of the administrative hold; provided that an administrative hold
under this section shall not be imposed for a period exceeding thirty business
days from the date the written notice is issued.
�
The office shall provide the licensed
business with written notice of the termination of an administrative hold.

����
�A-94
�
Liability to the State under this chapter as
debt.
�
(a)
�
Any liability to the State under this chapter
shall constitute a debt to the State.
�

Once a statement naming a licensed business as a debtor is recorded,
registered, or filed, the debt shall constitute a lien on all commercial
property owned by the licensed business in the State and shall have priority
over an encumbrance recorded, registered, or filed with respect to any
property.

����
(b)
�

If a lien imposed by subsection (a) is properly recorded, registered, or
filed, and three hundred sixty-five calendar days have elapsed from the date of
recording, registration, or filing with no response or action by the debtor
against whom the lien was recorded, registered, or filed, the administrator may
apply to the circuit court to have the lien converted into a civil
judgment.
�
The circuit court shall issue
a civil judgment for an amount equivalent to the value of the lien.

����
�A-95
�
Unauthorized access to a restricted area;
criminal offense.
�
(a)
�
No person shall intentionally or knowingly
enter or remain in a restricted area unless the person is:

����
(1)
�
An individual
licensee or permittee or registered employee of the licensed business;

����
(2)
�
A government
employee or official acting in the person's official capacity; or

����
(3)
�
Escorted by an
individual licensee or permittee or registered employee of the licensed
business at all times while in the restricted area; provided that:

���������
(A)
�
The person is at
least twenty-one years of age, as verified by a valid government-issued
identification card;

���������
(B)
�
The person is only
permitted within those portions of the restricted area as necessary to fulfill
the person's purpose for entering;

���������
(C)
�
The person is only
permitted within the restricted area during the times and for the duration
necessary to fulfill the person's purpose for entering; and

���������
(D)
�
The licensed
business shall keep a photographic copy of the person's valid government-issued
identification card and an accurate record of the date and time of entry into
and exit from the restricted area, the purpose of entry, and the identity of
the escort.

����
(b)
�

No individual licensee or permittee or registered employee of the
licensed business with control over or responsibility for the licensed premises
shall intentionally or knowingly allow another person to enter or remain in a
restricted area, unless that person is permitted to enter and remain as
specified in subsection (a).

����
(c)
�

Any person who violates this section shall be guilty of a petty
misdemeanor.

����
�A-96
�
Diversion from a licensed business; criminal
offense.
�
(a)
�
A person commits the offense of diversion
from a licensed business if the person is a licensed business or an operator,
agent, or employee of a licensed business and intentionally or knowingly
diverts to the person's own use or other unauthorized or illegal use, or takes,
makes away with, or conceals, with intent to divert to the person's own use or
other unauthorized or illegal use, any cannabis under the person's possession,
care, or custody as a licensed business or an operator, agent, or employee of a
licensed business.

����
(b)
�

Any person who violates this section shall be guilty of a class C
felony.

����
�A-97
�
Alteration or falsification of licensed
business records; criminal offense.
�

(a)
�
A person commits the offense
of alteration or falsification of licensed business records if the person
intentionally or knowingly:

����
(1)
�
Makes or causes a
false entry in licensed business records;

����
(2)
�
Alters, deletes,
destroys, erases, obliterates, or removes a true entry in licensed business
records;

����
(3)
�
Omits to make a
true entry in licensed business records in violation of a duty that the person
knows to be imposed upon the person by law or by the nature of the person's
position; or

����
(4)
�
Prevents the
making of a true entry or causes the omission of a true entry in licensed
business records.

����
(b)
�

Alteration or falsification of licensed business records shall be a
class C felony.

����
(c)
�

For the purposes of this section:

����
"Electronic" means
relating to technology having electrical, digital, magnetic, wireless, optical,
electromagnetic, or other similar capabilities.

����
"Information" includes
data, text, images, sounds, codes, computer programs, software, or databases.

����
"Licensed business
records" means any inventory tracking records and other records maintained
by a licensed business that are required by law to be created and retained or
provided to the office or department of taxation.

����
"Record" means information
that is written or printed or that is stored in an electronic or other medium
and is retrievable in a perceivable form.

����
�A-98
�
Unlawful restricted cannabinoid product
retailing; criminal offense.
�

(a)
�
A person required to obtain a
restricted cannabinoid product permit commits the offense of unlawful
restricted cannabinoid product retailing if the person recklessly fails to
obtain a valid permit required under section A-118 and recklessly distributes,
dispenses, sells, or offers for sale any restricted cannabinoid product or
possesses, stores, or acquires any restricted cannabinoid product for the
purpose of distribution, dispensing, sale, or offering for sale.

����
(b)
�

Unlawful restricted cannabinoid product retailing shall be a petty
misdemeanor; provided that any offense under subsection (a) that occurs within
five years of a prior conviction for unlawful restricted cannabinoid product
retailing shall be a misdemeanor.

����
�A-99
�
Law enforcement access to licensed business
records.
�
Notwithstanding any other
law, a licensed business shall disclose information, documents, tax records,
and other records regarding the licensed business's operation, upon request, to
any federal, state, or county agency engaged in the administrative regulation,
criminal investigation, or prosecution of violations of applicable federal,
state, or county laws, regulations, rules, or ordinances related to the
operations or activities of a licensed business.

PART
VII.
�
CANNABIS BUSINESSES; AUTHORIZED

����
�A-111
�
Independent laboratory; license required.
�
(a)
�
An
independent laboratory license shall authorize the sampling, limited
possession, and testing of cannabis and hemp pursuant to this chapter and rules
adopted pursuant to this chapter.

����
(b)
�

The office shall adopt rules for the licensure, operations, and
oversight of independent laboratories, including protocols for the sampling,
testing, and analysis of cannabis and hemp.
�

The rules shall address sampling and analysis related to cannabinoid
profiles and biological and chemical contaminants, including terpenoids,
pesticides, plant growth regulators, metals, microbiological contaminants,
mycotoxins, and residual solvents introduced through cultivation of cannabis
plants or hemp plants and post-harvest processing and handling of cannabis,
hemp, or any related ingredients.

����
(c)
�

An independent laboratory shall report any results indicating
contamination to the office within seventy-two hours of identification of
contamination.

����
(d)
�

No independent laboratory shall have a direct or indirect interest,
including by stock ownership, interlocking directors, mortgage or lien,
personal or real property, management agreement, shared parent companies or
affiliated organizations, or any other means, in any other type of licensed
business authorized by this chapter or rules adopted pursuant to this chapter.

����
(e)
�

No other licensed business shall have a direct or indirect interest,
including by stock ownership, interlocking directors, mortgage or lien,
personal or real property, management agreement, shared parent companies or
affiliated organizations, or any other means, in an independent laboratory.

����
(f)
�

No individual who possesses an interest in or is a laboratory agent
employed by an independent laboratory, and no immediate family member of that
individual, shall possess an interest in or be employed by any other licensed
business authorized by this chapter or rules adopted pursuant to this chapter.

����
(g)
�

No independent laboratory, laboratory agent, or employee of an
independent laboratory shall receive direct or indirect compensation, other
than reasonable contractual fees to conduct testing, from any entity for which
it is conducting testing pursuant to this chapter or rules adopted pursuant to
this chapter.

����
(h)
�

An independent laboratory shall:

����
(1)
�
Register each
laboratory agent with the office; and

����
(2)
�
Notify the office
within one business day if a laboratory agent ceases to be associated with the
independent laboratory.

����
(i)
�

No one who has been convicted of a felony drug offense shall be a
laboratory agent or an employee of an independent laboratory.
�
The office shall conduct criminal history record
checks of laboratory agents and employees of an independent laboratory in
accordance with section 846-2.7, and the office may adopt rules to establish
standards and procedures to enforce this subsection.

����
(j)
�

A laboratory agent shall not be subject to arrest, prosecution, civil
penalty, sanctions, or disqualifications, and shall not be subject to seizure
or forfeiture of assets under laws of the State, for actions taken under the
authority of an independent laboratory, including possessing, processing,
storing, transferring, or testing cannabis; provided that the laboratory agent
is:

����
(1)
�
Registered with
the office; and

����
(2)
�
Acting in
accordance with all the requirements under this chapter and rules adopted
pursuant to this chapter.

����
�A-112
�
Cannabis cultivator; license required.
�
(a)
�
A
cannabis cultivator license shall authorize:

����
(1)
�
The acquisition
and cultivation of cannabis plants, seeds, cuttings, or clones; and

����
(2)
�
The distribution
of cannabis plants and cannabis flower to:

���������
(A)
�
A cannabis
cultivator;

���������
(B)
�
A cannabis
processor;

���������
(C)
�
A medical cannabis
dispensary; and

���������
(D)
�
A retail cannabis
store.

����
(b)
�

A cannabis cultivator shall track the cannabis it cultivates from
acquisition to testing, distribution, or destruction.

����
(c)
�

A cannabis cultivator shall maintain a record of all samples provided to
an independent laboratory, the identity of the independent laboratory, and the
testing results.

����
(d)
�

The maximum size of plant canopy the office may authorize for each
cannabis cultivator license shall be three thousand five hundred square feet of
plant canopy for indoor cultivations and five thousand square feet of plant
canopy for outdoor cultivations, or a maximum plant count of fifteen thousand
indoor plants for all medical cannabis dispensary license cultivation locations
that converted pursuant to section 45 of Act , Session Laws
of Hawaii 2026.

����
(e)
�

A cannabis cultivator shall comply with all laws and rules applicable to
an agricultural operation, including laws and rules regarding pesticide use,
water use, and the environment, and all other requirements and standards as
prescribed by rules adopted by the office.
�

The requirements and standards prescribed by the office shall be guided
by sustainable farming principles and practices, such as organic, regenerative,
and integrated pest management models to the extent possible; limit the use of
pesticides, whenever possible; and encourage the use of renewable energies or
resources.

����
�A-113
�
Cannabis processor; license required.
�
(a)
�
A
cannabis processor license shall authorize the acquisition, possession, and
processing of cannabis into cannabis products, and distribution of cannabis to:

����
(1)
�
A cannabis
processor;

����
(2)
�
A medical cannabis
dispensary; and

����
(3)
�
A retail cannabis
store.

����
(b)
�

A cannabis processor shall track the cannabis it processes from
acquisition to testing, distribution, or destruction.

����
(c)
�

A cannabis processor shall maintain a record of all samples provided to
an independent laboratory, the identity of the independent laboratory, and the
testing results.

����
(d)
�

A cannabis processor shall calculate the equivalent physical weight of
the cannabis flower that is used to process the cannabis product and shall make
the equivalency calculations available to the office, consumer, and medical
cannabis patient.

����
�A-114
�
Medical cannabis dispensary; license
required.
�
(a)
�
A medical cannabis dispensary license shall
authorize:

����
(1)
�
The acquisition
and possession of cannabis;

����
(2)
�
The distribution
of cannabis to a retail cannabis store or medical cannabis dispensary; and

����
(3)
�
The dispensing of
cannabis from the licensed premises only to medical cannabis patients or their
caregivers.

����
(b)
�

A medical cannabis dispensary shall track all cannabis it possesses from
acquisition to testing, distribution, dispensing, or destruction.

����
(c)
�

A medical cannabis dispensary shall maintain a record of all samples
provided to an independent laboratory, the identity of the independent
laboratory, and the testing results.

����
(d)
�

Notwithstanding any other law to the contrary, a medical cannabis
dispensary shall not be subject to the prescription requirement of section
329-38 or the board of pharmacy licensure or regulatory requirements under
chapter 461.

����
�A-115
�
Retail cannabis store; license required.
�
(a)
�
A
retail cannabis store license shall authorize:

����
(1)
�
The acquisition
and possession of cannabis;

����
(2)
�
The distribution
of cannabis to a retail cannabis store or medical cannabis dispensary;

����
(3)
�
Subject to section A-51,
t
he dispensing of adult-use cannabis from the licensed premises to
consumers; and

����
(4)
�
The dispensing of
cannabis from the licensed premises to medical cannabis patients or their
caregivers.

����
(b)
�

A retail cannabis store shall ensure adequate access and product supply
to accommodate medical cannabis patients.
�

The office shall adopt rules to implement this section, including
requirements for:

����
(1)
�
Priority access or
business hours, or both, for medical cannabis patients; and

����
(2)
�
Product supply to
ensure medical cannabis patients have access to the cannabis used to treat
their debilitating medical conditions.

����
(c)
�

A retail cannabis store shall track all cannabis it possesses from
acquisition to testing, distribution, dispensing, or destruction.

����
(d)
�

A retail cannabis store shall maintain a record of all samples provided
to an independent laboratory, the identity of the independent laboratory, and
the testing results.

����
(e)
�

Notwithstanding any other law to the contrary, a retail cannabis store
shall not be subject to the prescription requirement of section 329-38 or the
board of pharmacy licensure or regulatory requirements under chapter 461.

����
�A-116
�
Craft cannabis dispensary; license required.
�
(a)
�
Subject
to section A-51, a craft cannabis dispensary license shall authorize the
limited:

����
(1)
�
Acquisition and
cultivation of cannabis plants, seeds, cuttings, or clones, and possession and
processing of adult-use cannabis;

����
(2)
�
Distribution of
adult-use cannabis to:

���������
(A)
�
A cannabis
processor;

���������
(B)
�
A medical cannabis
dispensary; and

���������
(C)
�
A retail cannabis
store; and

����
(3)
�
Dispensing of
adult-use cannabis from the licensed premises to consumers.

����
(b)
�

A craft cannabis dispensary shall distribute only its own cannabis.

����
(c)
�

A craft cannabis dispensary shall dispense only its own cannabis
directly to consumers.

����
(d)
�

A craft cannabis dispensary shall not process, distribute, or dispense
medical cannabis products.

����
(e)
�

No craft cannabis dispensary shall have a direct or indirect interest,
including by stock ownership, interlocking directors, mortgage or lien,
personal or real property, management agreement, shared parent companies or
affiliated organizations, or any other means, in any other licensed business
authorized by this chapter or rules adopted pursuant to this chapter, including
another craft cannabis dispensary.

����
(f)
�

No licensed business shall have a direct or indirect interest, including
by stock ownership, interlocking directors, mortgage or lien, personal or real
property, management agreement, shared parent companies or affiliated
organizations, or any other means, in any craft cannabis dispensary.

����
(g)
�

A craft cannabis dispensary shall track all cannabis it possesses from
acquisition to testing, distribution, dispensing, or destruction.

����
(h)
�

A craft cannabis dispensary shall maintain a record of all samples
provided to an independent laboratory, the identity of the independent
laboratory, and the testing results.

����
(i)
�

The size, scope, and eligibility criteria of a craft cannabis dispensary
shall be determined by rules adopted pursuant to this chapter; provided that
the granting of a craft cannabis dispensary license shall promote social equity
grant applicants as provided for in this chapter, legacy growers, and small
farms with a focus on indigenous crops or farming practices.

����
�A-117
�
Other licenses authorized.
�
The office may establish additional license
types and grant temporary licenses of any type specified in this part, in
accordance with conditions set forth in rules adopted pursuant to this chapter.

����
�A-118
�
Special use permits.
�
(a)
�

The office may issue permits for carrying out activities consistent with
the policy and purpose of this chapter with respect to cannabis and hemp.

����
(b)
�

The office may adopt rules to implement this section, including
reasonable fees, eligibility criteria, types of permits, and time limits for
any permit issued.
�
The types of permits
may include:

����
(1)
�
Special event and
social consumption permits;

����
(2)
�
Trucking permits
to allow for the trucking or transportation of cannabis by a person other than
a licensed business; and

����
(3)
�
Restricted
cannabinoid product permits that allow for the distribution, dispensing, sale,
or offering for sale of a restricted cannabinoid product.

PART
VIII.
�
HEMP

����
�A-131
�
Restricted cannabinoid product list.
�
(a)
�

The office shall create and maintain a list of restricted cannabinoid
products, derived from hemp, that shall only be sold pursuant to a permit
issued by the office under section A-118; provided that the office may
establish an amount of any restricted cannabinoid that may be allowed in a hemp
product; provided further that the office may prohibit any restricted
cannabinoid product from being distributed, dispensed, sold, or offered for
sale entirely.
�
The office shall publish
and make available the list of restricted cannabinoid products.

����
(b)
�

The office shall adopt rules establishing a process and procedure for
the office to create and maintain the restricted cannabinoid product list;
provided that the procedures shall include at a minimum:

����
(1)
�
Criteria based on
public health and safety for the office to determine what constitutes a
restricted cannabinoid product;

����
(2)
�
Criteria based on
public health and safety for the office to establish allowable limits for
restricted cannabinoids in hemp products; provided further that the office may
prohibit the restricted cannabinoid entirely; and

����
(3)
�
A process for
petitioning the office to add or remove a cannabinoid or restricted cannabinoid
product from the restricted cannabinoid product list.

����
(c)
�

The restricted cannabinoid product list shall not include hemp extract
products that are:

����
(1)
�
Intended only for
external topical application to the skin or hair; and

����
(2)
�
Tinctures;
provided that the tincture contains no more than thirty servings per bottle, no
more than three milligrams of tetrahydrocannabinol per serving, and no more
than ninety milligrams of tetrahydrocannabinol per bottle; provided further
that tinctures with over five milligrams of tetrahydrocannabinol per bottle
shall not be sold to persons under twenty-one years of age.

����
(d)
�

For the purposes of this section, "tincture" means a liquid
hemp extract product consisting of hemp extract dissolved in glycerin or a
plant-based oil, that is intended for oral consumption in small amounts using a
dropper, and that has a total volume of one ounce or less.

����
�A-132
�
Hemp cultivator; license required.
�
(a)
�
No
person shall cultivate hemp except in accordance with this section.
�
Cultivating hemp without a license to produce
hemp issued by the United States Secretary of Agriculture pursuant to title 7
United States Code section 1639q shall be considered unlicensed cultivation of
cannabis.

����
(b)
�

Notwithstanding any law to the contrary, it shall be legal for a person
to cultivate hemp only if they hold a license to produce hemp, issued by the
United States Secretary of Agriculture pursuant to title 7 United States Code
section 1639q; provided that hemp shall not be:

����
(1)
�
Cultivated within
three hundred feet of pre-existing real property comprising a playground, child
care facility, or school;

����
(2)
�
Cultivated within
one hundred feet of any pre-existing house, dwelling unit, residential
apartment, or other residential structure that is not owned or controlled by
the license holder;

����
(3)
�
Cultivated,
stored, or comingled with cannabis; and

����
(4)
�
Cultivated on any
premises licensed under this chapter, except on the licensed premises of a hemp
extract processor.

����
(c)
�

A hemp cultivator may distribute or sell hemp flower; provided that the
hemp flower:

����
(1)
�
Has passed all
compliance testing required by the United States Department of Agriculture; and

����
(2)
�
Meets all other
requirements for selling hemp, including testing, packaging, and labeling, as
provided in this chapter and rules adopted pursuant to this chapter.

����
(d)
�

A hemp cultivator licensed by the United States Department of
Agriculture to produce hemp in the State shall comply with all regulations
established by the United States Department of Agriculture, including all inspection,
sampling, and compliance testing requirements.

����
(e)
�

The office shall adopt rules pursuant to this chapter to implement this
section; provided that the rules adopted by the office shall not require
pre-harvest inspections, pre-harvest sampling, or pre-harvest compliance
testing with respect to the cultivation of hemp as regulated by the United
States Department of Agriculture.

����
(f)
�

In addition to any other penalties allowed by law, any person who
violates this section or any rule adopted pursuant to this section shall be
fined no more than $1,000 for each separate violation.
�
Each day on which a violation occurs or
continues shall be counted as a separate violation.

����
(g)
�

Any notice of violation of this section may be accompanied by a
cease-and-desist order.
�
The violation of
the cease-and-desist order shall constitute a further violation of this
section.

����
(h)
�

Any person aggrieved by a notice of violation issued under this section
may request a contested case hearing pursuant to chapter 91.
�
To request a contested case hearing, the
person shall submit a written request to the office within thirty calendar days
of the date of the notice of violation.
�

Appeal to the circuit court under section 91-14, or any other applicable
statute, shall only be taken from the office's final order pursuant to a
contested case.

����
(i)
�

Any action taken to recover, collect, or enforce the administrative
penalty provided for in this section shall be considered a civil action.
�
For any judicial proceeding to recover an
administrative penalty imposed pursuant to subsection (f) or to enforce a
cease-and-desist order issued pursuant to subsection (g), the office may
petition any court of appropriate jurisdiction and need only show that:

����
(1)
�
Notice was given;

����
(2)
�
A hearing was
held, or the time granted for requesting a hearing has expired without a
request;

����
(3)
�
The administrative
penalty or cease-and-desist order was imposed on the person cultivating hemp;
and

����
(4)
�
The penalty
remains unpaid, or there was no compliance with the order.

����
�A-133
�
Hemp extract processor; license required.
�
(a)
�
No
person shall process hemp into a hemp extract product without a hemp extract
processor license issued pursuant to this chapter and any rules adopted
pursuant to this chapter.
�
This section
shall not apply to processing hemp into an industrial hemp product.

����
(b)
�

A hemp extract processor license shall authorize the acquisition,
possession, and processing of hemp into hemp extract products and the
distribution of hemp extract products in compliance with this chapter.

����
(c)
�

A hemp extract processor license shall not authorize the distribution,
dispensing, or sale of any cannabis or restricted cannabinoid product.

����
(d)
�

Hemp shall be processed into a hemp extract product within an indoor
facility or within an agricultural building or structure as described in
section 46-88; provided that the hemp is processed without the use of heat,
volatile compounds, or gases under pressure except for carbon dioxide.
�
Hemp extract processors shall comply with all
applicable state laws and county ordinances, including zoning ordinances,
building codes, and fire codes.

����
�A-134
�
Hemp products.
�
(a)
�

The office shall adopt rules pursuant to this chapter to establish
requirements, restrictions, and standards regarding the types, ingredients, and
designs of hemp products, including potency limits and cannabinoid limits on
hemp extract products.

����
(b)
�

No person shall distribute, sell, or offer for sale crude hemp extract
to any person; provided that crude hemp extract may be sold only to a hemp
extract processor with a valid license issued by the office pursuant to section
A-133 or equivalent authorization from a regulatory agency in another
jurisdiction.

����
(c)
�

No person shall distribute, dispense, sell, or offer for sale any
restricted cannabinoid product unless that person holds a permit to distribute,
dispense, sell, or offer for sale restricted cannabinoid products issued by the
office pursuant to section A‑118.
�

A permit shall not be required to sell hemp products that are not
restricted cannabinoid products.

����
(d)
�

No person shall distribute, sell, or offer for sale any hemp extract
product used to aerosolize for respiratory routes of delivery, such as an
inhaler, a vape pen, or other device designed for that purpose.

����
(e)
�

Except for a hemp extract product intended for external topical
application to the skin or hair, no person shall distribute, sell, or offer for
sale any hemp extract product intended to be introduced via non-oral routes of
entry to the body, including use in the eyes, ears, or nasal cavities.

����
(f)
�

This section shall not apply to industrial hemp products; provided that
any industrial hemp products shall comply with all other applicable laws,
rules, and regulations.

PART IX.
�
SOCIAL
EQUITY

����
�A-141
�
Social equity grant program.
�
(a)
�

The office shall establish a social equity grant program to provide
grants to social equity grant applicants.

����
(b)
�
The advisory board shall be solely
responsible for reviewing and awarding
grants to assist social equity
grant applicants
:

����
(1)
�
In gaining entry to, and successfully
operating in, the State's regulated cannabis industry, including grants for
financial assistance, industry training, and technical assistance; or

����
(2)
�
That are community-based organizations
for the purpose of developing, implementing, and supporting nonprofit projects,
services, and programs that address community needs of disproportionately
impacted areas, including child care, after-school and summer programs, and
programs that build youth resiliency.

����
(c)
�
The office, through the chief equity officer
or administrator, shall have the power to:

����
(1)
�
Provide staff and administrative
support necessary to carry out the purposes of this section, including
facilitating the work of the advisory board and expending agencies;

����
(2)
�
Accept funds or grants and cooperate
with private entities and state or county agencies to carry out the purposes of
this section;

����
(3)
�
Fix, determine, charge, and collect any
premiums, fees, charges, costs, and expenses, including application fees,
commitment fees, program fees, financing charges, and publication fees in
connection with the social equity grant program;

����
(4)
�
Establish application, notification,
contract, and other forms and procedures deemed necessary and appropriate to
implement the social equity grant program; and

����
(5)
�
Utilize vendors or contract work to
carry out the purposes of this part.

����
(d)
�
Every grant shall be monitored by an
expending agency other than the office to ensure compliance with this chapter
and the public purpose and legislative intent of the grant.
�
The expending agency shall have the power to:

����
(1)
�
Enter
into agreements that set forth terms and conditions of the grants; and

����
(2)
�
Take
whatever actions are necessary or appropriate to protect the State's interest
in the event of bankruptcy, default, foreclosure, or noncompliance with the
terms and conditions of grants provided under this section, including the
ability to recapture funds if the grant recipient is found to be noncompliant
with the terms and conditions of the grant agreement.

����
(e)
�
The office, in consultation with the advisory
board, shall adopt rules pursuant to this chapter to implement this part,
including:

����
(1)
�
Additional requirements and
qualifications for determining eligibility of social equity grant applicants
for grants;

����
(2)
�
Preferences and priorities in
determining eligibility for grants;

����
(3)
�
Conditions, consistent with the purpose
of this chapter, for the awarding of grants;

����
(4)
�
Requirements for the inspection, at
reasonable hours, of facilities, books, and records of a social equity grant
applicant or grant recipient;

����
(5)
�
Requirements for the submission of
progress and final reports by grant recipients; and

����
(6)
�
Appropriate management counseling and
monitoring of business activities for grant recipients.

����
(f)
�
The office shall submit an annual report on
the social equity grant program to the governor and legislature no later than
twenty days prior to the convening of each regular session.
�
The report shall detail the outcomes and
effectiveness of this section during the prior fiscal year, including the
following:

����
(1)
�
The number of social equity grant
applicants who received financial assistance under this section;

����
(2)
�
The amount of grants awarded in the
aggregate;

����
(3)
�
The location of the project engaged in
by each grant recipient; and

����
(4)
�
Grants awarded to child care,
after-school and summer programs, and programs that build youth resiliency by
county and program outcomes.

����
(g)
�
The office shall include engagement with
individuals with limited English proficiency as part of the social equity grant
program.

����
(h)
�
The office shall make available to the public
the rubric for determining eligibility for social equity grants.

����
�A-142
�
Social equity grants; standards and
conditions.
�
(a)
�
Grants made under this part shall be awarded
on a competitive and annual basis.
�

Grants made under this part shall further and promote the goals of the
social equity grant program.

����
(b)
�
Applications for grants shall be made to the advisory
board and contain information as shall be required by rules adopted pursuant to
this chapter.
�
At a minimum, a social
equity grant applicant shall show:

����
(1)
�
The name of the applying business
entity or individual;

����
(2)
�
That the social equity grant applicant
meets the criteria for a social equity grant applicant;

����
(3)
�
The intended use of the grant; and

����
(4)
�
The target group or community to be
benefited by the grant.

����
(c)
�
Recipients of grants shall be subject to the
following conditions:

����
(1)
�
The recipient of a grant shall not use
public funds for purposes of entertainment or perquisites, including lobbying
activities;

����
(2)
�
The recipient of a grant shall comply
with state laws and county ordinances;

����
(3)
�
The recipient of a grant shall comply
with any other requirements that may be prescribed by rules adopted pursuant to
this chapter;

����
(4)
�
The recipient of a grant shall allow
the expending agency for the grant, legislative bodies, and auditor full access
to records, reports, files, and other related documents so that the program,
management, and fiscal practices of the grant recipient may be monitored and
evaluated to assure the proper and effective expenditure of public funds;

����
(5)
�
Every grant shall be monitored by the
expending agency for the grant according to rules adopted pursuant to this
chapter to ensure compliance with this part; and

����
(6)
�
Any recipient of a grant under this
part who withholds or omits any material fact or deliberately misrepresents
facts to the advisory board or expending agency for the grant or who violates
the terms of the grant agreement shall be in violation of this section and, in
addition to any other penalties provided by law, shall be prohibited from
applying for a grant or any other benefits under this part for a period of five
years from the date of termination.

����
�A-143
�
Fee waivers.
�
(a)
�

For social equity grant applicants, the office shall waive fifty per
cent of any license application fees and any fees associated with purchasing a
license to operate a licensed business for the initial five years of the social
equity grant applicant's operations; provided that the social equity grant
applicant meets the following qualifications at the time the payment is due:

����
(1)
�
The social equity grant applicant,
including all persons with a direct or indirect interest in the social equity
grant applicant, has less than a total of $750,000 of income in the previous
calendar year; and

����
(2)
�
The social equity grant applicant,
including all persons with a direct or indirect interest in the social equity
grant applicant, has no more than three other licenses issued under this
chapter.

����
(b)
�
The office shall require social equity grant
applicants to attest that they meet the requirements for a fee waiver as
provided in subsection (a) and to provide evidence of annual total income in
the previous calendar year.

����
(c)
�
If the office determines that an applicant
who applied for a fee waiver is not eligible as a social equity grant
applicant, the applicant shall be provided an additional ten calendar days to
provide alternative evidence that the applicant qualifies as a social equity grant
applicant.
�
Alternatively, the applicant
may pay the remainder of the waived fee and be considered as a non-social
equity grant applicant.
�
If the applicant
fails to do either, the office may retain the initial application fee and the
application shall be deemed withdrawn.

PART X.
�
PUBLIC
HEALTH AND EDUCATION

����
�A-151
�
Public health and education campaign.
�
(a)
�

The office shall contract with an entity to develop and implement a
comprehensive public health and education campaign regarding the legalization
of cannabis pursuant to section A-51 and the impact of cannabis use on public
health and safety, including the health risks associated with cannabis and ways
to protect children.
�
The public health
and education campaign shall also include education to the public about this
chapter, including the potential risks associated with patronizing unlicensed
dispensary locations, or otherwise procuring cannabis through persons not
authorized by the office.
�
The public
health and education campaign shall begin no later than September 1, 2026.

����
(b)
�
After the initial campaign, the office shall
continue to periodically develop and implement a comprehensive public health
and education campaign on issues related to cannabis, as necessary.

����
�A-152
�
Public health and education grant program.
�
(a)
�

The office shall establish a public health and education grant program to
provide grants to programs dedicated to preventing and treating substance
abuse, especially among youth, and educating the public about cannabis use,
this chapter, and other laws regarding cannabis.

����
(b)
�

The advisory board shall be solely responsible for
reviewing
and
awarding grants to assist:

����
(1)
�
Substance
abuse prevention and treatment programs in the State;

����
(2)
�
Community-based
organizations with developing, implementing, and supporting youth services,
including child care, after-school and summer programs, and programs that build
youth resiliency, youth recreational centers, services for housing, counseling,
and preventing or treating youth substance abuse; and

����
(3)
�
Community-based
organizations with developing, implementing, and supporting programs for
individuals with a dual diagnosis of mental disorder and substance abuse
disorder, including services for supportive housing, residential treatment,
outpatient treatment, counseling, and other related services.

����
(c)
�
The office, through the chief public health
and education officer or administrator, shall have the power to:

����
(1)
�
Provide staff and administrative
support necessary to carry out the purposes of this section, including
facilitating the work of the advisory board and expending agencies;

����
(2)
�
Accept funds or grants and cooperate
with private entities and state or county agencies to carry out the purposes of
this section;

����
(3)
�
Fix, determine, charge, and collect any
premiums, fees, charges, costs, and expenses, including application fees,
commitment fees, program fees, financing charges, or publication fees in
connection with its activities under this section;

����
(4)
�
Establish application, notification,
contract, and other forms and procedures deemed necessary and appropriate to implement
this section; and

����
(5)
�
Utilize vendors or contract work to
carry out the purposes of this section.

����
(d)
�

Every grant shall be monitored by an expending agency other than the
office to ensure compliance with this chapter and the public purpose and
legislative intent of the grant.
�
The
expending agency shall have the power to:

����
(1)
�
Enter into agreements that set forth
terms and conditions of the grants; and

����
(2)
�
Take
whatever actions are necessary or appropriate to protect the State's interest
in the event of bankruptcy, default, foreclosure, or noncompliance with the
terms and conditions of grants provided under this section, including the
ability to recapture funds if the grant recipient is found to be noncompliant
with the terms and conditions of the grant agreement.

����
(e)
�
The office, in consultation with the advisory
board, shall adopt rules pursuant to this chapter to implement this part,
including:

����
(1)
�
Additional requirements and
qualifications for determining eligibility of applicants for grants;

����
(2)
�
Preferences and priorities in
determining eligibility for grants;

����
(3)
�
Conditions, consistent with the purpose
of this chapter, for the awarding of grants;

����
(4)
�
Requirements for the inspection, at
reasonable hours, of facilities, books, and records of a grant applicant or
grant recipient;

����
(5)
�
Requirements for the submission of
progress and final reports by grant recipients; and

����
(6)
�
Appropriate management counseling and
monitoring of business activities for grant recipients.

����
(f)
�
The office shall submit an annual report on
the public health and education grant program to the governor and legislature
no later than twenty days prior to the convening of each regular session.
�
The report shall detail the outcomes and
effectiveness of this section during the prior fiscal year, including the
following:

����
(1)
�
The number of persons or businesses who
received financial assistance under this section;

����
(2)
�
The amount of grants awarded in the
aggregate;

����
(3)
�
The location of the project engaged in
by each grant recipient;

����
(4)
�
The extent and reach of the public
health and education campaigns;

����
(5)
�
The number of adult and youth substance
abuse and dual diagnosis prevention and treatment programs served by county;
and

����
(6)
�
The number of youth support and
resiliency programs served by county.

����
�A-153
�
Public health and education grants; standards
and conditions.
�
(a)
�
Grants made under this part shall be awarded
on a competitive and annual basis.
�

Grants made under this part shall further and promote the goals of this
chapter.

����
(b)
�
Applications for grants shall be made to the advisory
board and contain information as shall be required by rules adopted pursuant to
this chapter.
�
At a minimum, an applicant
shall show:

����
(1)
�
The name of the applying organization
or individual;

����
(2)
�
That the applicant meets the criteria
for the grant;

����
(3)
�
The intended use of the grant; and

����
(4)
�
The target group or community to be
benefited by the grant.

����
(c)
�
Recipients of grants shall be subject to the
following conditions:

����
(1)
�
The recipient of a grant shall not use
public funds for purposes of entertainment or perquisites, including lobbying
activities;

����
(2)
�
The recipient of a grant shall comply
with state laws and county ordinances;

����
(3)
�
The recipient of a grant shall comply
with any other requirements that may be prescribed by rules adopted pursuant to
this chapter;

����
(4)
�
The recipient of a grant shall allow
the expending agency for the grant, legislative bodies, and auditor full access
to records, reports, files, and other related documents so that the program,
management, and fiscal practices of the grant recipient may be monitored and
evaluated to assure the proper and effective expenditure of public funds;

����
(5)
�
Every grant shall be monitored by the
expending agency for the grant according to rules adopted pursuant to this
chapter to ensure compliance with this part; and

����
(6)
�
Any recipient of a grant under this
part who withholds or omits any material fact or deliberately misrepresents
facts to the advisory board or expending agency for the grant or who violates
the terms of the grant agreement shall be in violation of this section and, in
addition to any other penalties provided by law, shall be prohibited from
applying for a grant or any other benefits under this part for a period of five
years from the date of termination.

PART XI.
�
PUBLIC
SAFETY

����
�A-161
�
Public safety grant program.
�
(a)
�

The office shall establish a public safety grant program to provide grants
to state and county agencies and private entities to assist with public safety
resources relating to cannabis, including law enforcement resources.

����
(b)
�
The advisory board shall be solely
responsible for reviewing and awarding grants:

����
(1)
�
To t
rain and certify state and county
law enforcement officers as drug recognition experts for detecting,
identifying, and apprehending individuals operating a vehicle under the
influence of an intoxicant or otherwise impaired;

����
(2)
�
To develop, implement, and support
crisis intervention services, including alternative response programs and
co-response programs that provide trained social service providers or mental
health counselors to respond to, or assist law enforcement agencies with
responding to, nonviolent emergencies, including welfare checks, public
intoxication, and mental health episodes;

����
(3)
�
To train state and county law
enforcement officers in mental health first aid;

����
(4)
�
For the effective enforcement and
prosecution of violations of the nuisance abatement laws under part V of
chapter 712;

����
(5)
�
To harm reduction programs, including
crisis outreach programs, food banks, mental health support programs, homeless
outreach programs, outpatient treatment programs, and housing assistance
programs;

����
(6)
�
To improve data sharing across law
enforcement agencies and the judiciary; and

����
(7)
�
To state and county law enforcement
agencies for equipment and training to assist with investigating and
prosecuting illegal activities related to cannabis.

����
(c)
�
The office, through the chief compliance
officer or administrator, shall have the power to:

����
(1)
�
Provide staff and administrative
support necessary to carry out the purposes of this part, including
facilitating the work of the advisory board and expending agencies;

����
(2)
�
Accept funds or grants and cooperate
with private entities and state or county agencies to carry out the purposes of
this part;

����
(3)
�
Fix, determine, charge, and collect any
premiums, fees, charges, costs, and expenses, including application fees,
commitment fees, program fees, financing charges, or publication fees in
connection with its activities under this part;

����
(4)
�
Establish application, notification,
contract, and other forms and procedures deemed necessary and appropriate to implement
this part; and

����
(5)
�
Utilize vendors or contract work to
carry out the purposes of this part.

����
(d)
�

Every grant shall be monitored by an expending agency other than the
office to ensure compliance with this chapter and the public purpose and
legislative intent of the grant.
�
The
expending agency shall have the power to:

����
(1)
�
Enter into agreements that set forth
terms and conditions of the grants; and

����
(2)
�
Take
whatever actions are necessary or appropriate to protect the State's interest
in the event of bankruptcy, default, foreclosure, or noncompliance with the
terms and conditions of grants provided under this section, including the
ability to recapture funds if the grant recipient is found to be noncompliant
with the terms and conditions of the grant agreement.

����
(e)
�
The office, in consultation with the advisory
board, shall adopt rules pursuant to this chapter to implement this part,
including:

����
(1)
�
Additional requirements and
qualifications for determining eligibility of applicants for grants;

����
(2)
�
Preferences and priorities in
determining eligibility for grants;

����
(3)
�
Conditions, consistent with the purpose
of this chapter, for the awarding of grants;

����
(4)
�
Requirements for the inspection, at
reasonable hours, of facilities, books, and records of a grant applicant or
grant recipient;

����
(5)
�
Requirements for the submission of
progress and final reports by grant recipients; and

����
(6)
�
Appropriate management counseling and
monitoring of business activities for grant recipients.

����
(f)
�
The office shall submit an annual report on
the public safety grant program to the governor and legislature no later than
twenty days prior to the convening of each regular session.
�
The report shall detail the outcomes and
effectiveness of this section during the prior fiscal year, including the
following:

����
(1)
�
The number of persons, businesses, or
agencies who received financial assistance under this section;

����
(2)
�
The amount of grants awarded in the
aggregate;

����
(3)
�
The location of the project engaged in
by the person, business, or agency; and

����
(4)
�
If applicable, the number of new jobs
and other forms of economic output created as a result of the grants.

����
�A-162
�
Public safety grants; standards and
conditions.
�
(a)
�
Grants made under this part shall be awarded
on a competitive and annual basis.
�

Grants made under this part shall further and promote the goals of this
chapter.

����
(b)
�
Applications for grants shall be made to the advisory
board and contain information as shall be required by rules adopted pursuant to
this chapter.
�
At a minimum, an applicant
shall show:

����
(1)
�
The name of the applying organization
or individual;

����
(2)
�
That the applicant meets the criteria
for the grant;

����
(3)
�
The intended use of the grant; and

����
(4)
�
The target group or community to be
benefited by the grant.

����
(c)
�
Recipients of grants shall be subject to the
following conditions:

����
(1)
�
The recipient of a grant shall not use
public funds for purposes of entertainment or perquisites, including lobbying
activities;

����
(2)
�
The recipient of a grant shall comply
with state laws and county ordinances;

����
(3)
�
The recipient of a grant shall comply
with any other requirements that may be prescribed by rules adopted pursuant to
this chapter;

����
(4)
�
The recipient of a grant shall allow
the expending agency for the grant, legislative bodies, and auditor full access
to records, reports, files, and other related documents so that the program,
management, and fiscal practices of the grant recipient may be monitored and
evaluated to assure the proper and effective expenditure of public funds;

����
(5)
�
Every grant shall be monitored by the
expending agency for the grant according to rules adopted pursuant to this
chapter to ensure compliance with this part; and

����
(6)
�
Any recipient of a grant under this
part who withholds or omits any material fact or deliberately misrepresents
facts to the advisory board or expending agency for the grant or who violates
the terms of the grant agreement shall be in violation of this section and, in
addition to any other penalties provided by law, shall be prohibited from
applying for a grant or any other benefits under this part for a period of five
years from the date of termination.

PART
XII.
�
MISCELLANEOUS

����
�A-171
�
Banking.
�

(a)
�
A financial institution that
receives deposits, extends credit, conducts fund transfers, transports cash or
financial instruments, or provides other financial services customarily
provided by financial institutions shall not be penalized or punished under any
criminal law, including chapter 708A, or under any provision of the Code of
Financial Institutions, chapter 412, solely by virtue of the fact that the
person receiving the benefit of any of those services engages in commercial cannabis
activity as a cannabis business licensed pursuant to this chapter.

����
(b)
�

A cannabis business may request in writing that the office share the
cannabis business's application, license, and other regulatory and financial
information with a financial institution of the cannabis business's
designation.
�
The cannabis business shall
include in that written request a waiver authorizing the transfer of that
information and waiving any confidentiality or privilege that applies to that
information.

����
(c)
�

Notwithstanding any other law to the contrary, upon receipt of a written
request and waiver pursuant to subsection (b), the office may share the
cannabis business's application, license, and other regulatory and financial
information with the financial institution designated by the cannabis business
in that request for the purpose of facilitating the provision of financial
services for that cannabis business.

����
(d)
�

A cannabis business that provides a waiver may withdraw that waiver in
writing at any time.
�
Upon receipt of the
written withdrawal of the waiver, the office shall cease to share application,
license, and other regulatory and financial information with the financial
institution.

����
(e)
�

This section shall be construed to refer only to the disclosure of
information by the office reasonably necessary to facilitate the provision of
financial services for the cannabis business making a request pursuant to this
section.
�
Nothing in this section shall
be construed to authorize the disclosure of confidential or privileged
information, or waive a cannabis business's rights to assert confidentiality or
privilege, except to a financial institution as provided in this section and
except as reasonably necessary to facilitate the provision of financial
services for the cannabis business making the request.

����
(f)
�

For the purpose of this section:

����
"Application, license, and
other regulatory and financial information" includes but is not limited to
information in the seed-to-sale tracking system established pursuant to section
A-88.

����
"Financial institution"
has the same meaning as defined in section 412:1-109.

����
�A-172
�
Hawaii-grown labeling.
�
In addition to all other labeling
requirements, the identity statement used for labeling or advertising cannabis
or hemp shall identify the percentage of Hawaii-grown cannabis or hemp;
provided that any hemp product containing hemp not grown or processed in Hawaii
shall identify the origin and percentage of the hemp from outside Hawaii in the
hemp product; provided further that if the hemp product contains hemp from
multiple origins, the hemp product shall identify the percentage of hemp origin
as "United States" or, if the hemp product includes hemp from a
source outside of the United States, the hemp product shall identify the
percentage of hemp origin as "Foreign".

����
�A-173
�
Data collection and research.
�
(a)
�

The office shall collect data and develop a research agenda to
understand the social and economic trends of cannabis in the State, to inform
future decisions that would aid in the closure of the illicit marketplace, and
to inform the office on the public health impacts of cannabis.
�
The research agenda shall include:

����
(1)
�
Patterns of use,
methods of consumption, sources of purchase, and general perceptions of
cannabis among minors, college and university students, and adults;

����
(2)
�
Incidents of
driving under the influence, hospitalization, and use of other health care
services related to cannabis use;

����
(3)
�
Economic and
fiscal impacts for the State, including the impact of legalization, if
applicable, on the production and distribution of cannabis in the illicit
market and the costs and benefits to state revenue;

����
(4)
�
Ownership and
employment trends in the cannabis industry;

����
(5)
�
A market analysis
examining the expansion or contraction of the illicit and legal marketplaces,
including estimates and comparisons of pricing and product availability in both
markets;

����
(6)
�
A compilation of
data on the number of incidents of discipline in schools, including suspensions
or expulsions, resulting from the use or possession of cannabis; and

����
(7)
�
A compilation of
data on the number of civil penalties, arrests, prosecutions, incarcerations,
and sanctions imposed for violations of this chapter for possession,
distribution, or trafficking of cannabis.

����
(b)
�

The office shall incorporate available data into its research agenda,
including baseline studies, and coordinate and form partnerships with the
department of health, department of education, department of agriculture,
department of the attorney general, department of law enforcement, and police
department of each county.
�
The
departments listed in this subsection shall:

����
(1)
�
Provide the office
with any existing data requested by the office, subject to any applicable
confidentiality laws and rules regarding personally identifiable information
and personal health information; and

����
(2)
�
Collect data, as
reasonably requested by the office, to complete the office's research agenda.

����
(c)
�

Any personally identifiable information or personal health information
contained in data acquired through this section shall not be considered a
public record and shall not be subject to disclosure.

����
(d)
�

The office shall annually report on the results of its research agenda
and, when appropriate, make recommendations for further research or policy
changes.
�
The annual reports shall be
posted online in a machine-readable format on the office's website.

����
�A-174
�
Hawaii hemp grant program.
�
(a)
�

The office shall establish the Hawaii hemp grant program to provide
grants to local hemp farmers and hemp projects.

����
(b)
�
The advisory board shall be solely
responsible for reviewing and awarding grants to assist:

����
(1)
�
Small
hemp cultivators and hemp businesses in gaining entry to, and successfully
operating in, the State's hemp industry, including grants for financial
assistance, industry training, and technical assistance; and

����
(2)
�
Research
projects related to industrial uses of hemp and marketability of hemp products.

����
(c)
�
The office, through the hemp coordinator or
administrator, shall have the power to:

����
(1)
�
Provide staff and administrative
support necessary to carry out the purposes of the Hawaii hemp grant program,
including facilitating the work of the advisory board and expending agencies;

����
(2)
�
Accept funds or grants and cooperate with
private entities and state or county agencies to carry out the purposes of the
Hawaii hemp grant program;

����
(3)
�
Fix, determine, charge, and collect any
premiums, fees, charges, costs, and expenses, including application fees,
commitment fees, program fees, financing charges, or publication fees in
connection with the Hawaii hemp grant program;

����
(4)
�
Establish application, notification,
contract, and other forms and procedures deemed necessary and appropriate to implement
the Hawaii hemp grant program; and

����
(5)
�
Utilize vendors or contract work to
carry out the purposes of the Hawaii hemp grant program.

����
(d)
�
Every grant shall be monitored by an
expending agency other than the office to ensure compliance with this chapter
and the public purpose and legislative intent of the grant.
�
The expending agency shall have the power to:

����
(1)
�
Enter into agreements that set forth
terms and conditions of the grants; and

����
(2)
�
Take whatever actions are necessary or
appropriate to protect the State's interest in the event of bankruptcy,
default, foreclosure, or noncompliance with the terms and conditions of grants
provided under this section, including the ability to recapture funds if the
grant recipient is found to be noncompliant with the terms and conditions of
the grant agreement.

����
(e)
�
The office, in consultation with the advisory
board, shall adopt rules pursuant to this chapter to implement the Hawaii hemp
grant program, including:

����
(1)
�
Additional requirements and
qualifications for determining eligibility of applicants for grants;

����
(2)
�
Preferences and priorities in
determining eligibility for grants;

����
(3)
�
Conditions, consistent with the purpose
of this chapter, for the awarding of grants;

����
(4)
�
Requirements for the inspection, at
reasonable hours, of facilities, books, and records of a grant applicant or
grant recipient;

����
(5)
�
Requirements for the submission of
progress and final reports by grant recipients; and

����
(6)
�
Appropriate management counseling and
monitoring of business activities for grant recipients.

����
(f)
�
The office shall submit an annual report on
the Hawaii hemp grant program to the governor and legislature no later than
twenty days prior to the convening of each regular session.
�
The report shall detail the outcomes and
effectiveness of this section during the prior fiscal year, including the
following:

����
(1)
�
The number of persons or businesses who
received financial assistance under this section;

����
(2)
�
The amount of grants awarded in the
aggregate;

����
(3)
�
The location of the project engaged in
by each grant recipient; and

����
(4)
�
If applicable, the number of new jobs
and other forms of economic output created as a result of the grants.

����
�A-175
�
Hawaii hemp grants; standards and conditions.
�
(a)
�

Grants made under the Hawaii hemp grant program shall be awarded on a
competitive and annual basis.
�
Grants
made under the Hawaii hemp grant program shall further and promote the goals of
this chapter.

����
(b)
�
Applications for grants shall be made to the advisory
board and contain information as shall be required by rules adopted pursuant to
this chapter.
�
At a minimum, an applicant
shall show:

����
(1)
�
The name of the applying business
entity or individual;

����
(2)
�
That the applicant meets the criteria
for the grant;

����
(3)
�
The intended use of the grant; and

����
(4)
�
The target group or community to be
benefited by the grant.

����
(c)
�
Recipients of grants shall be subject to the
following conditions:

����
(1)
�
The recipient of a grant shall not use
public funds for purposes of entertainment or perquisites, including lobbying
activities;

����
(2)
�
The recipient of a grant shall comply
with state laws and county ordinances;

����
(3)
�
The recipient of a grant shall comply
with any other requirements that may be prescribed by rules adopted pursuant to
this chapter;

����
(4)
�
The recipient of a grant shall allow
the expending agency, legislative bodies, and auditor full access to records,
reports, files, and other related documents so that the program, management,
and fiscal practices of the grant recipient may be monitored and evaluated to
assure the proper and effective expenditure of public funds;

����
(5)
�
Every grant shall be monitored
according to rules adopted pursuant to this chapter to ensure compliance with
the Hawaii hemp grant program; and

����
(6)
�
Any recipient of a grant under the
Hawaii hemp grant program who withholds or omits any material fact or
deliberately misrepresents facts to the advisory board or expending agency for
the grant or who violates the terms of the grant agreement shall be in
violation of this section and, in addition to any other penalties provided by
law, shall be prohibited from applying for a grant or any other benefits under
the Hawaii hemp grant program for a period of five years from the date of
termination."

PART III

����
SECTION 3.
�
The purpose of this part is to impose taxes
on the sale of cannabis and require every business engaged in the sale of
cannabis to obtain a cannabis tax permit.

����
SECTION 4.
�
The Hawaii Revised Statutes is amended by
adding a new chapter to title 14 to be appropriately designated and to read as
follows:

"
CHAPTER
B

HAWAII
CANNABIS TAX LAW

����
�B-1
�
Definitions.
�
As used in this chapter, unless the context
otherwise requires:

����
"Cannabis" has the same
meaning as defined in section A-3.

����
"Department" means the
department of taxation.

����
"Director" means the director
of taxation.

����
"Medical cannabis" has the
same meaning as defined in section A-3.

����
"Retail sale" has the same
meaning as "retailing" or "sales at retail" as defined in
section 237-1.

����
�B-2
�
Cannabis tax permit.
�
(a)
�
No
person shall engage in the retail sale of cannabis or sale of medical cannabis
unless a permit has been issued to the person pursuant to this section;
provided that this section shall not apply to persons who make sales at
wholesale.

����
(b)
�

The cannabis tax permit shall be issued by the department upon
application and payment of an application fee of $25.
�
Whenever a cannabis tax permit is defaced,
destroyed, or lost, or the permittee relocates the permittee's business, the
department may issue a duplicate cannabis tax permit to the permittee for a fee
of $5 per copy.
�
The permit provided for
by this section shall be effective until canceled in writing.
�
The director may revoke or cancel any permit
issued under this chapter for cause as provided by rules adopted pursuant to
chapter 91.

����
(c)
�

A separate cannabis tax permit shall be obtained for each place of
business owned, controlled, or operated by a taxpayer.
�
A taxpayer who owns or controls more than one
place of business may submit a single application for more than one cannabis
tax permit; provided that the application fee of $25 shall be required for each
permit.
�
Each cannabis tax permit issued
shall clearly describe the place of business where the retail sale of cannabis
or sale of medical cannabis is conducted.

����
(d)
�

A cannabis tax permit shall be non-assignable and non-transferable.
�
A cannabis tax permit may be transferred from
one business location to another business location after:

����
(1)
�
An application has
been filed with the department requesting the transfer;

����
(2)
�
The applicant has
paid a transfer fee of $25; and

����
(3)
�
Approval has been
obtained from the department.

����
(e)
�

Any cannabis tax permit issued under this chapter shall be displayed at
all times in a conspicuous place at each of the licensed premises of the
taxpayer.

����
�B-3
�
Tax.
�

(a)
�
Upon every person engaging or
continuing within the State in the retail sale of cannabis, beginning upon the
effective date as stated in section A-51, and continuing thereafter, there is
hereby levied and shall be assessed and collected a tax equal to fourteen per
cent of the gross proceeds of retail sales from cannabis; provided that this
subsection shall not apply to the sale of medical cannabis.

����
(b)
�

Upon every person engaging or continuing within the State in the sale of
medical cannabis, beginning January 1, 2027, and continuing thereafter, there
is hereby levied and shall be assessed and collected a tax equal to four per
cent of the gross proceeds of sales from medical cannabis; provided that this
subsection shall not apply to sales at wholesale.

����
�B-4
�
Return; forms; contents.
�
(a)
�

Every person subject to tax under this chapter shall, on or before the
twentieth day of each month, file with the department, a return showing all
sales of cannabis and of the taxes chargeable against the person under section
B-3 made by the person during the preceding month.
�
The form of return shall be prescribed by the
department and shall contain information that the department may deem necessary
for the proper administration of this chapter.

����
(b)
�

On or before the twentieth day of the fourth month following the close
of the taxable year, each taxpayer who has become liable for the payment of
taxes under this chapter during the preceding tax year shall file a return
showing all sales of cannabis made by the person during the taxable year, in
the form and manner prescribed by the department, and shall transmit with the
return a remittance covering the residue of the tax due, if any.

����
�B-5
�
Payment of tax; penalties.
�
(a)
�
At
the time of the filing of the return required under section B-4 and within the
time prescribed, each person subject to the tax imposed by this chapter shall
pay to the department the tax required to be shown by the return.

����
(b)
�

Penalties and interest shall be added to and become a part of the tax,
when and as provided by section 231-39.

����
�B-6
�
Limitation period for assessment, levy,
collection, or credit.
�
(a)
�
General rule.
�

The amount of taxes imposed by this chapter shall be assessed or levied
within three years after filing of the annual return, or within three years of
the due date prescribed for the filing of the annual return, whichever is
later.
�
No proceeding in court without
assessment for the collection of the taxes or the enforcement of the liability
shall be commenced after the expiration of the period.
�
Where the assessment of the tax imposed by
this chapter has been made within the applicable period of limitation, the tax
may be collected by levy or by a proceeding in court under chapter 231;
provided that the levy is made, or the proceeding was begun, within fifteen
years after the assessment of the tax.

����
Notwithstanding any other provision
to the contrary in this section, the limitation on collection after assessment
in this section shall be suspended for the period:

����
(1)
�
The taxpayer
agrees to suspend the period;

����
(2)
�
The assets of the
taxpayer are in control or custody of a court in any proceeding before any
court of the United States or any state, and for six months thereafter;

����
(3)
�
An offer in
compromise under section 231-3(10) is pending;

����
(4)
�
During which the
taxpayer is outside the State for a continuous period of at least six months;
provided that if at the time of the taxpayer's return to the State the period
of limitations on collection after assessment would expire before the
expiration of six months from the date of the taxpayer's return, the period
shall not expire before the expiration of the six months; and

����
(5)
�
An appeal of the
assessment is pending before the taxation board of review or the tax appeal
court, beginning on the date the notice of appeal is filed and concluding on
the date a final decision is issued or the case is withdrawn or dismissed.

����
(b)
�

Limitations on credit or refund.
�

No credit or refund shall be allowed for any tax imposed by this chapter
unless a claim for credit or refund is filed as follows:

����
(1)
�
If an annual
return is timely filed, or is filed within three years after the date
prescribed for filing the annual return, then the credit or refund shall be
claimed within three years after the date the annual return was filed or the
date prescribed for filing the annual return, whichever is later; or

����
(2)
�
If an annual
return is not filed, or is filed more than three years after the date
prescribed for filing the annual return, a claim for credit or refund shall be
filed within three years after:

���������
(A)
�
The payment of the
tax; or

���������
(B)
�
The date prescribed
for the filing of the annual return,

���������
whichever is later;

provided that paragraphs (1) and (2) shall be
mutually exclusive.

����
(c)
�

Exceptions; fraudulent return or no return.
�
In the case of a false or fraudulent return
with intent to evade tax or liability, or of a failure to file the annual
return, the tax or liability may be assessed or levied at any time; provided
that the burden of proof with respect to the issues of falsity or fraud and
intent to evade tax shall be upon the State.

����
(d)
�

Extension by agreement.
�
Where,
before the expiration of the period prescribed in subsection (a) or (b), both
the department and the taxpayer have consented in writing to the assessment or
levy of the tax after the date fixed by subsection (a) or the credit or refund
of the tax after the date fixed by subsection (b), the tax may be assessed or
levied or the overpayment, if any, may be credited or refunded at any time
before the expiration of the period agreed upon.
�
The period so agreed upon may be extended by
subsequent agreements in writing made before the expiration of the period
previously agreed upon.

����
�B-7
�
Disposition of revenues.
�
The tax collected pursuant to this chapter
shall be paid into the state treasury as a state realization to be kept and
accounted for as provided by law; provided that revenues collected under this
chapter shall be distributed quarterly in the following priority:

����
(1)
�
An amount
necessary to defray the cost of the operations and administrative expenses of
the Hawaii cannabis and hemp office established under chapter A shall be
deposited into the cannabis regulation and enforcement special fund established
by section A-16; and

����
(2)
�
After making the
distribution required under paragraph (1):

���������
(A)
�
Thirty per cent
shall be deposited into the social equity grant program subaccount established
by section A-16(c);

���������
(B)
�
Ten per cent shall
be deposited into the public health and education grant program subaccount
established by section A-16(d);

���������
(C)
�
Ten per cent shall
be deposited into the public safety grant program subaccount established by
section A-16(e);

���������
(D)
�
Five per cent
shall be deposited into the Hawaii hemp grant program subaccount established by
section A-16(f);

���������
(E)
�
Five per cent
shall be deposited to the counties, which shall be allocated to each county
based on the percentage of revenue collected from that county;

���������
(F)
�
Five per cent
shall be deposited to the department of the attorney general for the drug
nuisance abatement unit established under section 28-131; and

���������
(G)
�
Five per cent
shall be deposited to the department of the attorney general for the special
investigation and prosecution division for the purpose of preventing the
proliferation of money laundering and organized crime that may result from the
expansion of the legal cannabis market or is related to fentanyl and
methamphetamine.

����
�B-8
�
Records to be kept.
�
(a)
�

Every person subject to tax under this chapter shall keep records of all
sales of cannabis in a form prescribed by the department.
�
All records shall be offered for inspection
and examination at any time upon demand by the department or Hawaii cannabis
and hemp office and shall be preserved for a period of five years; provided
that the department may, in writing, consent to the records' destruction within
that period or may adopt rules that require the records to be kept longer.

����
The department may, by rule, require
the person subject to tax under this chapter to keep other records as the
department may deem necessary for the proper enforcement of this chapter.

����
(b)
�

If any person subject to tax under this chapter fails to keep records
from which a proper determination of the tax due under this chapter may be
made, the department may fix the amount of tax for any period from the best
information the department obtains, and assess the tax as provided in this
section.

����
(c)
�

Every person subject to tax under this chapter shall keep a complete and
accurate record of that person's cannabis inventory.
�
The records shall:

����
(1)
�
Include:

���������
(A)
�
A written
statement containing the name and address of the source of cannabis;

���������
(B)
�
The date of
delivery, quantity, weight, and price of the cannabis; and

���������
(C)
�
Documentation in
the form of any purchase orders; invoices; bills of lading; or other written
statements, books, papers, or records in whatever format, including electronic
format, that substantiate the purchase or acquisition of the cannabis stored or
offered for sale; and

����
(2)
�
Be offered for
inspection and examination within twenty-four hours of demand by the department
or Hawaii cannabis and hemp office and shall be preserved for a period of five
years; provided that the department may, in writing, consent to the records'
destruction within that period or may adopt rules that require the records to
be kept longer.

����
�B-9
�
Inspection.
�
(a)
�
A
person subject to tax under this chapter shall be subject to the inspection and
investigation provisions in chapter 231 and shall provide the department with
any information deemed necessary to verify compliance with the requirements of
this chapter.

����
(b)
�

The department and Hawaii cannabis and hemp office may examine all
records required to be kept under this chapter, and books, papers, and records
of any person subject to tax under this chapter, to verify the accuracy of the
payment of the tax imposed by this chapter and other compliance with this
chapter and rules adopted pursuant to this chapter.
�
Every person in possession of the books,
papers, and records and the person's agents and employees shall give the
department and Hawaii cannabis and hemp office the means, facilities, and
opportunities for examination.

����
(c)
�

Returns, return information, or reports under this chapter, and relating
only to this chapter, may be provided to the Hawaii cannabis and hemp office by
the department for the purpose of enforcing or ensuring compliance with chapter
A.

����
Notwithstanding the foregoing, the
inspection, review, or production of any and all federal tax returns and return
information shall only be provided as permitted in accordance with applicable
federal law.

����
�B-10
�
Tax in addition to other taxes.
�
The tax imposed by this chapter, unless
expressly prohibited, shall be in addition to any other tax imposed upon the
business of selling cannabis or upon any of the transactions, acts, or
activities taxed by law.

����
�B-11
�
Appeals.
�

Any person aggrieved by any assessment of the tax imposed by this
chapter may appeal from the assessment in the manner and within the time and in
all other respects as provided in the case of income tax appeals by section
235-114.
�
The hearing and disposition of
the appeal, including the distribution of costs, shall be as provided in
chapter 232.

����
�B-12
�
Other provisions applicable.
�
All of the provisions of chapters 231, 235,
and 237 not inconsistent with this chapter and that may appropriately be
applied to the taxes, persons, circumstances, and situations involved in this
chapter, including (without prejudice to the generality of the foregoing)
provisions as to penalties and interest, granting administrative powers to the
director, and for the assessment, levy, and collection of taxes, shall be
applicable to the taxes imposed by this chapter, and to the assessment, levy,
and collection thereof.

����
�B-13
�
Inquiry, audits, investigations, hearings,
and subpoenas.
�
The director, and any
agent authorized by the director, may conduct any inquiry, civil audit,
criminal investigation, investigation, or hearing relating to any assessment,
the amount of any tax, or the collection of any delinquent tax, including any
audit or investigation into the financial resources of any delinquent taxpayer
or the collectability of any delinquent tax, in the manner provided in section
231-7.

����
�B-14
�
Administration by director; rules;
implementation.
�
(a)
�
The administration of this chapter shall be
vested in the director who may adopt and enforce rules for the enforcement and
administration of this chapter.

����
(b)
�

The director shall adopt rules pursuant to chapter 91.

����
(c)
�

The director may employ tax law change specialists to assist with the
implementation of this chapter, each of whom shall be subject to chapter 76.

����
�B-15
�
Penalties.
�
(a)
�

The penalties provided by this chapter shall apply to any person,
whether acting as principal, agent, officer, or director, for oneself, itself,
or for another person and shall apply to each single violation.

����
(b)
�

In addition to the penalties imposed under title 14, including this
chapter, and under chapter A, any person or cannabis retailer who sells
cannabis, or medical cannabis dispensary who sells medical cannabis, without a
permit as required by this chapter shall be fined no more than $1,000 per
violation.
�
Each day a violation
continues shall constitute a separate violation.

����
(c)
�

For purposes of this section:

����
"Cannabis retailer" means
a person who engages in the retail sale of cannabis pursuant to a license or
permit issued under chapter A.
�

"Cannabis retailer" includes a retail cannabis store, a craft
cannabis dispensary, and any permit holder who engages in the retail sale of
cannabis pursuant to a permit issued under chapter A and does not include a
medical cannabis dispensary.

����
"Craft cannabis
dispensary" has the same meaning as defined in section A-3.

����
"Medical cannabis
dispensary" has the same meaning as defined in section A-3.

����
"Retail cannabis store"
has the same meaning as defined in section A-3."

PART IV

����
SECTION 5.
�
The purpose of this part is to prohibit:

����
(1)
�
Consuming
marijuana or marijuana concentrate or possessing an open container of marijuana
or marijuana concentrate while operating, or while a passenger in, a motor
vehicle or moped; and

����
(2)
�
Operating a
vehicle under the influence of marijuana or marijuana concentrate.

����
SECTION 6.
�
Chapter 291, Hawaii Revised Statutes, is
amended by adding three new sections to part I to be appropriately designated
and to read as follows:

����
"
�291-
�
Consuming marijuana or marijuana
concentrate while operating, or while a passenger in or on, a motor vehicle or
moped.
�
(a)
�
No person shall consume, including through
secondhand or passive smoking, any marijuana or marijuana concentrate while
operating a motor vehicle or moped upon any public street, road, or highway.

����
(b)
�
No person shall smoke or vaporize any
marijuana or marijuana concentrate while a passenger in any motor vehicle or on
any moped upon any public street, road, or highway.

����
(c)
�
Any person violating this section shall be
guilty of a petty misdemeanor; provided that, notwithstanding section 706‑640,
the maximum fine shall be no more than $2,000.

����
�291-
�
Open container of marijuana or marijuana
concentrate in a motor vehicle or on a moped.
�
(a)
�

No person shall possess any bottle, can, package, wrapper, smoking
device, cartridge, or other receptacle containing any marijuana or marijuana
concentrate that has been opened, has a seal broken, or the contents of which
have been partially removed, or loose marijuana or marijuana concentrate not in
a container, within any passenger area of a motor vehicle or moped being
operated upon any public street, road, or highway.

����
(b)
�
This section shall not apply to marijuana,
marijuana concentrate, or a bottle, can, package, wrapper, smoking device,
cartridge, or other receptacle containing any marijuana or marijuana
concentrate that is stored in a trunk, luggage compartment, or similar
location.

����
(c)
�
Any person violating this section shall be
guilty of a violation and shall be fined no more than $130.
�
A person found responsible for a violation
under this section may request, and shall be granted, a penalty of up to ten
hours of community service in lieu of a fine.

����
�291-
�
Marijuana or marijuana concentrate; prima
facie evidence.
�
Any bottle,
can, package, wrapper, smoking device, cartridge, or other receptacle that
displays or is imprinted with a label indicating that the contents contain
marijuana or marijuana concentrate shall be prima facie evidence that the
contents of the bottle, can, package, wrapper, smoking device, cartridge, or
other receptacle contains marijuana or marijuana concentrate.
"

����
SECTION 7.
�
Chapter 291E, Hawaii Revised Statutes, is
amended as follows:

����
1.
�

By adding a new section to part II to be appropriately designated and to
read:

����
"
�291E-A
�
Refusal to submit to testing for
tetrahydrocannabinol; persons under the age of twenty-one; district court
hearing; sanctions; appeals; admissibility.
�
(a)
�

If a person under arrest for operating a vehicle while under the
influence of tetrahydrocannabinol, pursuant to section 291E-B, refuses to
submit to a blood test, none shall be given, except as provided in section
291E-21, but the arresting law enforcement officer, as soon as practicable,
shall submit an affidavit to a district judge of the circuit in which the
arrest was made stating that:

����
(1)
�
At the time of
the arrest, the arresting officer had probable cause to believe the person
arrested was under the age of twenty-one and had been operating a vehicle upon
a public way, street, road, or highway, or on or in the waters of the State,
while under the influence of tetrahydrocannabinol;

����
(2)
�
The person
arrested was informed that the person may refuse to submit to a blood test, in
compliance with section 291E-11;

����
(3)
�
The person
arrested had refused to submit to a blood test;

����
(4)
�
The person
arrested was:

���������
(A)
�
Informed
of the sanctions of this section; and

���������
(B)
�
Secondly
queried if the person still refuses to submit to a blood test, in compliance
with the requirements of section 291E-15; and

����
(5)
�
The person
arrested continued to refuse to submit to a blood test.

����
(b)
�
Upon receipt of the affidavit, the district
judge shall hold a hearing within twenty days.
�

The district judge shall hear and determine whether:

����
(1)
�
The arresting
law enforcement officer had probable cause to believe that the person arrested
was under the age of twenty-one and had been operating a vehicle upon a public
way, street, road, or highway, or on or in the waters of the State, while under
the influence of tetrahydrocannabinol;

����
(2)
�
The person was
lawfully arrested;

����
(3)
�
The person
arrested was informed that the person may refuse to submit to a blood test, in
compliance with section 291E-11;

����
(4)
�
The person
arrested refused to submit to a blood test;

����
(5)
�
The person
arrested was:

���������
(A)
�
Informed
of the sanctions of this section; and

���������
(B)
�
Secondly
queried if the person still refuses to submit to a blood test, in compliance
with the requirements of section 291E-15; and

����
(6)
�
The person
continued to refuse to submit to a blood test.

����
(c)
�
If the district judge finds the statements
contained in the affidavit are true, the judge shall suspend the arrested
person's license and privilege to operate a vehicle as follows:

����
(1)
�
For a first
suspension, or any suspension not preceded within a five-year period by a
suspension under this section, for a period of twelve months; and

����
(2)
�
For any
subsequent suspension under this section, for a period no less than two years
and no more than five years.

����
(d)
�
An order of a district court issued under
this section may be appealed to the supreme court.
"

����
2.
�

By adding a new section to part IV to be appropriately designated and to
read:

����
"
�291E-B
�
Operating a vehicle under the influence of
tetrahydrocannabinol; persons under the age of twenty-one; expungement.
�
(a)
�

It shall be unlawful for any person under the age of twenty-one to
operate any vehicle while under the influence of tetrahydrocannabinol.
�
A law enforcement officer may arrest a person
under this section when the officer has probable cause to believe the person
arrested is under the age of twenty-one and had been operating a vehicle upon a
public way, street, road, or highway, or on or in the waters of the State,
while under the influence of tetrahydrocannabinol.

����
(b)
�
A person who violates this section shall be
sentenced as follows:

����
(1)
�
For a first
violation or any violation not preceded within a five-year period by a prior
drug enforcement contact:

���������
(A)
�
The
court shall impose:

��������������
(i)
�
A
requirement that the person and, if the person is under the age of eighteen,
the person's parent or guardian, attend a substance abuse education and
counseling program for no more than ten hours; and

�������������
(ii)
�
A
one hundred eighty-day prompt suspension of license and privilege to operate a
vehicle with absolute prohibition from operating a vehicle during the
suspension period; provided that in the case of a person who is at least
eighteen years of age, the court may impose, in lieu of the one hundred
eighty-day prompt suspension of license, a minimum thirty-day prompt suspension
of license with absolute prohibition from operating a vehicle and, for the
remainder of the one hundred eighty-day period, a restriction on the license
that allows the person to drive for limited work-related purposes and to
participate in substance abuse education and treatment programs; and

���������
(B)
�
In
addition, the court may impose any one or more of the following:

��������������
(i)
�
No
more than thirty-six hours of community service work; or

�������������
(ii)
�
A
fine of no less than $150 but no more than $500;

����
(2)
�
For a violation
that occurs within five years of a prior drug enforcement contact:

���������
(A)
�
The
court shall impose prompt suspension of license and privilege to operate a
vehicle for a period of one year with absolute prohibition from operating a
vehicle during the suspension period; and

���������
(B)
�
In
addition, the court may impose any of the following:

��������������
(i)
�
No
more than fifty hours of community service work; or

�������������
(ii)
�
A
fine of no less than $300 but no more than $1,000; and

����
(3)
�
For a violation
that occurs within five years of two or more prior drug enforcement contacts:

���������
(A)
�
The
court shall impose revocation of license and privilege to operate a vehicle for
a period of two years; and

���������
(B)
�
In
addition, the court may impose any of the following:

��������������
(i)
�
No
more than one hundred hours of community service work; or

�������������
(ii)
�
A
fine of no less than $300 but no more than $1,000.

����
(c)
�
Notwithstanding any other law to the
contrary, any conviction or plea under this section shall be considered a prior
drug enforcement contact.

����
(d)
�
Whenever a court sentences a person pursuant
to subsection (b)(2) or (3), it also shall require that the person be referred
to the driver's education program for an assessment, by a certified substance
abuse counselor, of the person's substance abuse or dependence and the need for
appropriate treatment.
�
The counselor
shall submit a report with recommendations to the court.
�
The court shall require the person to obtain
appropriate treatment if the counselor's assessment establishes the person's
substance abuse or dependence.
�
All costs
for assessment and treatment shall be borne by the person or by the person's
parent or guardian, if the person is under the age of eighteen.

����
(e)
�
Notwithstanding section 831-3.2 or any other
law to the contrary, a person convicted of a first-time violation under
subsection (b)(1), who had no prior drug enforcement contacts, may apply to the
court for an expungement order upon attaining the age of twenty-one, or
thereafter, if the person has fulfilled the terms of the sentence imposed by
the court and has had no subsequent alcohol enforcement contacts or drug
enforcement contacts.

����
(f)
�
Notwithstanding any other law to the
contrary, whenever a court revokes a person's driver's license pursuant to this
section, the examiner of drivers shall not grant to the person an application
for a new driver's license for a period to be determined by the court.

����
(g)
�
Any person sentenced under this section may
be ordered to reimburse the county for the cost of any blood tests conducted
pursuant to section 291E-11.
�
The court
shall order the person to make restitution in a lump sum, or in a series of
prorated installments, to the police department or other agency incurring the
expense of the blood test.

����
(h)
�
The requirement to provide proof of financial
responsibility pursuant to section 287-20 shall not be based upon a sentence
imposed under subsection (b)(1).

����
(i)
�
Any person who violates this section shall be
guilty of a violation.

����
(j)
�
As used in this section:

����
"Driver's license" has
the same meaning as in section 286‑2.

����
"Examiner of drivers"
has the same meaning as in section 286-2.
"

����
SECTION 8.
�
Section 291-1, Hawaii Revised Statutes, is
amended by adding two new definitions to be appropriately inserted and to read
as follows:

����
"
"Marijuana" has
the same meaning as defined in section 712-1240.

����
"Marijuana concentrate"
has the same meaning as defined in section 712-1240.
"

����
SECTION 9.
�
Section 291E-1, Hawaii Revised Statutes, is
amended by adding three new definitions to be appropriately inserted and to
read as follows:

����
"
"Marijuana" has
the same meaning as defined in section 712-1240.

����
"Marijuana concentrate"
has the same meaning as defined in section 712-1240.

����
"Tetrahydrocannabinol"
means the cannabinoids that function as the primary psychoactive component of
marijuana or marijuana concentrate.
"

PART V

����
SECTION
10
.
�
Section
28-8.3, Hawaii Revised Statutes, is amended as follows:

����
1.
�

By amending subsection (a) to read:

����
"
(a)
�
No department of the
State other than the attorney general [
may
]
shall
employ or
retain any attorney, by contract or otherwise, for the purpose of representing
the State or the department in any litigation, rendering legal counsel to the
department, or drafting legal documents for the department; provided that [
the
foregoing provision
]
this subsection
shall not apply to the
employment or retention of attorneys:

����
(1)
�
By the public utilities commission, [
the
]
labor and industrial relations appeals board, and [
the
] Hawaii labor
relations board;

����
(2)
�
By any court or judicial or legislative office
of the State; provided
further
that if the attorney general is requested
to provide representation to a court or judicial office by the chief justice or
the chief justice's designee, or to a legislative office by the speaker of the
house of representatives and [
the
] president of the senate jointly, and
the attorney general declines to provide [
such
]
the

representation on the grounds of conflict of interest, the attorney general
shall retain an attorney for the court, judicial[
,
]
office,
or
legislative office, subject to approval by the court, judicial[
,
]
office,

or legislative office;

����
(3)
�
By the legislative reference bureau;

����
(4)
�
By any compilation commission that may be
constituted from time to time;

����
(5)
�
By the real estate commission for any action
involving the real estate recovery fund;

����
(6)
�
By the contractors license board for any
action involving the contractors recovery fund;

����
(7)
�
By the office of Hawaiian affairs;

����
(8)
�
By the department of commerce and consumer
affairs for the enforcement of violations of chapters 480 and 485A;

����
(9)
�
As grand jury counsel;

���
(10)
�
By the Hawaii health systems corporation, or
its regional system boards, or any of their facilities;

���
(11)
�
By the auditor;

���
(12)
�
By the office of ombudsman;

���
(13)
�
By the insurance division;

���
(14)
�
By the [
University
]
university

of Hawaii;

���
(15)
�
By the Kahoolawe island reserve commission;

���
(16)
�
By the division of consumer advocacy;

���
(17)
�
By the office of elections;

���
(18)
�
By the campaign spending commission;

���
(19)
�
By the Hawaii tourism authority, as provided
in section 201B-2.5;

���
(20)
�
By the division of financial institutions;

���
(21)
�
By the office of information practices;

���
(22)
�
By the school facilities authority;

���
(23)
�
By
the Mauna Kea
stewardship and oversight authority
; [
or
]

���
(24)
�
By the Hawaii cannabis and hemp office; or

��
[
(24)
]

(25)
�
By a department, if the attorney
general, for reasons deemed by the attorney general to be good and sufficient,
declines to employ or retain an attorney for a department; provided
further

that the governor waives the provision of this section."

����
2.
�

By amending subsection (c) to read:

����
"
(c)
�
Every attorney employed by
any department on a full-time basis, except an attorney employed by the public
utilities commission, the labor and industrial relations appeals board, the
Hawaii labor relations board, the office of Hawaiian affairs, the Hawaii health
systems corporation or its regional system boards, the department of commerce
and consumer affairs in prosecution of consumer complaints,
the

insurance division, the division of consumer advocacy, the [
University
]
university

of Hawaii, the Hawaii tourism authority as provided in section 201B-2.5, the
Mauna Kea stewardship and oversight authority,
the Hawaii cannabis and hemp
office,
the office of information practices, or as grand jury counsel,
shall be a deputy attorney general.
"

����
SECTION
11
.
�
Section
28-131, Hawaii Revised Statutes, is amended by amending subsection (c) to read
as follows:

����
"(c)
�
The purpose of the drug nuisance abatement
unit shall be to provide for the effective enforcement and prosecution of those
violations of the drug nuisance abatement laws under chapter 712, part V but
only for offenses related to drugs and intoxicating compounds as provided under
chapter 712, part IV and violations of chapter [
329D
]
A
as
provided under section 712-1270.
�
The
drug nuisance abatement unit may also review and take appropriate action on
drug nuisance complaints of any citizen of the State, or drug nuisances that
are discovered by the unit in carrying out its activities."

����
SECTION
12
.
�
Section 46-4,
Hawaii Revised Statutes, is amended by amending subsection (f) to read as
follows:

����
"
(f)
�
Neither this section
nor any other law, county ordinance, or rule shall prohibit the use of land for
[
medical
] cannabis [
production centers or medical cannabis
dispensaries
]
businesses
established and licensed pursuant to
chapter [
329D; provided that the land is otherwise zoned for agriculture,
manufacturing, or retail purposes.
]
A, except as provided in section
A-21.
"

����
SECTION
13
.
�
Section 76-16,
Hawaii Revised Statutes, is amended by amending subsection (b) to read as
follows:

����
"
(b)
�
The civil service to which this chapter
applies shall comprise all positions in the State now existing or hereafter
established and embrace all personal services performed for the State, except
the following:

����
(1)
�
Commissioned and enlisted personnel of
the Hawaii National Guard and positions in the Hawaii National Guard that are
required by state or federal laws or regulations or orders of the National
Guard to be filled from those commissioned or enlisted personnel;

����
(2)
�
Positions filled by persons employed by
contract where the director of human resources development has certified that
the service is special or unique or is essential to the public interest and
that, because of circumstances surrounding its fulfillment, personnel to
perform the service cannot be obtained through normal civil service recruitment
procedures.
�
Any contract may be for any
period not exceeding one year;

����
(3)
�
Positions that must be filled without
delay to comply with a court order or decree if the director determines that
recruitment through normal recruitment civil service procedures would result in
delay or noncompliance, such as the Felix-Cayetano consent decree;

����
(4)
�
Positions filled by the legislature or
by either house or any committee thereof;

����
(5)
�
Employees in the office of the governor
and office of the lieutenant governor, and household employees at Washington
Place;

����
(6)
�
Positions filled by popular vote;

����
(7)
�
Department heads, officers, and members
of any board, commission, or other state agency whose appointments are made by
the governor or are required by law to be confirmed by the senate;

����
(8)
�
Judges, referees, receivers, masters,
jurors, notaries public, land court examiners, court commissioners, and
attorneys appointed by a state court for a special temporary service;

����
(9)
�
One bailiff for the chief justice of
the supreme court who shall have the powers and duties of a court officer and
bailiff under section 606-14; one secretary or clerk for each justice of the
supreme court, each judge of the intermediate appellate court, and each judge
of the circuit court; one secretary for the judicial council; one deputy
administrative director of the courts; three law clerks for the chief justice
of the supreme court, two law clerks for each associate justice of the supreme
court and each judge of the intermediate appellate court, one law clerk for
each judge of the circuit court, two additional law clerks for the civil
administrative judge of the circuit court of the first circuit, two additional
law clerks for the criminal administrative judge of the circuit court of the
first circuit, one additional law clerk for the senior judge of the family
court of the first circuit, two additional law clerks for the civil motions
judge of the circuit court of the first circuit, two additional law clerks for
the criminal motions judge of the circuit court of the first circuit, and two
law clerks for the administrative judge of the district court of the first
circuit; and one private secretary for the administrative director of the
courts, the deputy administrative director of the courts, each department head,
each deputy or first assistant, and each additional deputy, or assistant
deputy, or assistant defined in paragraph (16);

���
(10)
�
First deputy and deputy attorneys
general, the administrative services manager of the department of the attorney
general, one secretary for the administrative services manager, an
administrator and any support staff for the criminal and juvenile justice resources
coordination functions, and law clerks;

���
(11)
�
(A)
�
Teachers, principals, vice-principals,
complex area superintendents, deputy and assistant superintendents, other
certificated personnel, and no more than twenty noncertificated administrative,
professional, and technical personnel not engaged in instructional work;

���������
(B)
�
Effective July 1, 2003, teaching
assistants, educational assistants, bilingual or bicultural school-home
assistants, school psychologists, psychological examiners, speech pathologists,
athletic health care trainers, alternative school work study assistants,
alternative school educational or supportive services specialists, alternative
school project coordinators, and communications aides in the department of
education;

���������
(C)
�
The special assistant to the state
librarian and one secretary for the special assistant to the state librarian;
and

���������
(D)
�
Members of the faculty of the university
of Hawaii, including research workers, extension agents, personnel engaged in
instructional work, and administrative, professional, and technical personnel
of the university;

���
(12)
�
Employees engaged in special, research,
or demonstration projects approved by the governor;

���
(13)
�
(A)
�
Positions filled by inmates, patients
of state institutions, and persons with severe physical or mental disabilities
participating in the work experience training programs;

���������
(B)
�
Positions filled with students in
accordance with guidelines for established state employment programs; and

���������
(C)
�
Positions that provide work experience
training or temporary public service employment that are filled by persons
entering the workforce or persons transitioning into other careers under
programs such as the federal Workforce Investment Act of 1998, as amended, or
the Senior Community Service Employment Program of the Employment and Training
Administration of the United States Department of Labor, or under other similar
state programs;

���
(14)
�
A custodian or guide at Iolani Palace,
the Royal Mausoleum, and Hulihee Palace;

���
(15)
�
Positions filled by persons employed on
a fee, contract, or piecework basis, who may lawfully perform their duties
concurrently with their private business or profession or other private
employment and whose duties require only a portion of their time, if it is
impracticable to ascertain or anticipate the portion of time to be devoted to
the service of the State;

���
(16)
�
Positions
of first deputies or first assistants of each department head appointed under
or in the manner provided in section 6, article V, of the Hawaii State
Constitution; three additional deputies or assistants either in charge of the
highways, harbors, and airports divisions or other functions within the
department of transportation as may be assigned by the director of
transportation, with the approval of the governor;
one additional deputy
in the department of human services either in charge of welfare or other
functions within the department as may be assigned by the director of human
services;

four additional deputies in the department of health, each in charge of one of
the following:
�
behavioral health,
environmental health, hospitals, and health resources administration, including
other functions within the department as may be assigned by the director of
health, with the approval of the governor; two additional deputies in charge of
the law enforcement programs, administration, or other functions within the
department of law enforcement as may be assigned by the director of law
enforcement, with the approval of the governor; three additional deputies each
in charge of the correctional institutions, rehabilitation services and
programs, and administration or other functions within the department of
corrections and rehabilitation as may be assigned by the director of
corrections and rehabilitation, with the approval of the governor; two
administrative assistants to the state librarian; and an administrative
assistant to the superintendent of education;

���
(17)
�
Positions specifically exempted from
this part by any other law; provided that:

���������
(A)
�
Any exemption created after July 1,
2014, shall expire three years after its enactment unless affirmatively
extended by an act of the legislature; and

���������
(B)
�
All of the positions defined by
paragraph (9) shall be included in the position classification plan;

���
(18)
�
Positions in the state foster
grandparent program and positions for temporary employment of senior citizens
in occupations in which there is a severe personnel shortage or in special
projects;

���
(19)
�
Household employees at the official
residence of the president of the university of Hawaii;

���
(20)
�
Employees in the department of
education engaged in the supervision of students during meal periods in the
distribution, collection, and counting of meal tickets, and in the cleaning of
classrooms after school hours on a less than half-time basis;

���
(21)
�
Employees hired under the tenant hire
program of the Hawaii public housing authority; provided that no more than
twenty-six per cent of the authority's workforce in any housing project
maintained or operated by the authority shall be hired under the tenant hire
program;

���
(22)
�
Positions of the federally funded
expanded food and nutrition program of the university of Hawaii that require
the hiring of nutrition program assistants who live in the areas they serve;

���
(23)
�
Positions filled by persons with severe
disabilities who are certified by the state vocational rehabilitation office
that they are able to perform safely the duties of the positions;

���
(24)
�
The sheriff;

���
(25)
�
A gender and other fairness coordinator
hired by the judiciary;

���
(26)
�
Positions in the Hawaii National Guard
youth and adult education programs;

���
(27)
�
In the Hawaii state energy office in
the department of business, economic development, and tourism, all energy
program managers, energy program specialists, energy program assistants, and
energy analysts;

���
(28)
�
Administrative appeals hearing officers
in the department of human services;

���
(29)
�
In the Med-QUEST division of the
department of human services, the division administrator, finance officer,
health care services branch administrator, medical director, and clinical
standards administrator;

���
(30)
�
In
the director's office of the department of human services, the enterprise
officer, information security and privacy compliance officer, security and
privacy compliance engineer, security and privacy compliance analyst
, information technology implementation manager, assistant
information technology implementation manager, resource manager, community or
project development director, policy director, special assistant to the
director, and limited English proficiency project manager or coordinator;

���
(31)
�
The Alzheimer's disease and related
dementia services coordinator in the executive office on aging;

���
(32)
�
In the Hawaii emergency management
agency, the executive officer, public information officer, civil defense
administrative officer, branch chiefs, and emergency operations center state
warning point personnel; provided that for state warning point personnel, the
director shall determine that recruitment through normal civil service
recruitment procedures would result in delay or noncompliance;

���
(33)
�
The executive director and seven
full-time administrative positions of the school facilities authority;

���
(34)
�
Positions in the Mauna Kea stewardship
and oversight authority;

���
(35)
�
In the office of homeland security of
the department of law enforcement, the statewide interoperable communications
coordinator
;

���
(36)
�
In the social services division of the
department of human services, the business technology analyst;

���
(37)
�
The executive director and staff of the
911 board;

���
(38)
�
The software developer supervisor and
senior software developers in the department of taxation;

���
(39)
�
In
the department of law enforcement, five Commission on Accreditation for Law
Enforcement Agencies, Inc., coordinator positions;

���
(40)
�
The state fire marshal and deputy state fire
marshal in the office of the state fire marshal;

���
(41)
�
The administrator for the law
enforcement standards board;

���
(42)
�
In the office of the director of
taxation, the data privacy officer and tax business analysts; [
and
]

[
[
](43)[
]

]
���
All
positions filled by the Hawaii tourism authority within the department of
business, economic development, and tourism[
.
]
; and

���
(44)
�
The administrator of the Hawaii
cannabis and hemp office pursuant to section A-11.

����
The director shall determine the
applicability of this section to specific positions.

����
Nothing in this section shall be deemed to
affect the civil service status of any incumbent as it existed on July 1, 1955.
"

����
SECTION
14
.
�
Section
91-13.5, Hawaii Revised Statutes, is amended by amending subsection (f) to read
as follows:

����
"(f)
�
This section shall not apply to:

����
(1)
�
Any proceedings of
the public utilities commission; [
or
]

����
(2)
�
Any proceedings
of the Hawaii cannabis and hemp office; or

���
[
(2)
]

(3)
�
Any county or county agency that is exempted
by county ordinance from this section."

����
SECTION
15
.
�
Section
201-13.9, Hawaii Revised Statutes, is amended to read as follows:

����
"
�201-13.9
�
Medical cannabis;
economic and other data; collection.
�

(a)
�
The department shall
continuously collect de‑identified information regarding the medical cannabis
[
registry
]
registration
and
medical cannabis
dispensary
programs established pursuant to [
chapters 329 and 329D,
]
chapter A,

including but not limited to information regarding the:

����
(1)
�
Quantities of
medical

cannabis cultivated and dispensed;

����
(2)
�
Number of
qualifying patients;

����
(3)
�
Geographic areas
in which
medical
cannabis is cultivated and consumed;

����
(4)
�
Prices of
medical

cannabis and related products;

����
(5)
�
Number of
employment opportunities related to
medical
cannabis; and

����
(6)
�
Economic impact of

medical
cannabis cultivation and sales.

����
(b)
�

The [
department of health
]
Hawaii cannabis and hemp office

and
medical cannabis
dispensaries
and retail cannabis stores

licensed pursuant to chapter [
329D
]
A
shall provide de-identified
aggregated data as required by the department pursuant to this section.

����
(c)
�

Upon request, the department shall provide an analysis of the aggregated
de-identified data to the [
department of health
]
Hawaii cannabis and
hemp office
and [
the
] legislature."

����
SECTION
16
.
�
Section
209E-2, Hawaii Revised Statutes, is amended by amending the definition of
"eligible business activity" to read as follows:

����
""Eligible business
activity" means the:

����
(1)
�
Manufacture of
tangible personal property, the wholesale sale of tangible personal property as
described in section 237-4, or a service business as defined in this section;

����
(2)
�
Production of
agricultural products where the business is a producer as defined in section
237-5, or the processing of agricultural products, all or some of which were
grown within an enterprise zone;

����
(3)
�
Research,
development, sale, or production of all types of genetically-engineered
medical, agricultural, or maritime biotechnology products; or

����
(4)
�
Production of
electric power from wind energy for sale primarily to a public utility company
for resale to the public;

provided that [
medical cannabis dispensary
]
the

activities
of a cannabis business
pursuant to chapter [
329D
]
A

shall not be considered an eligible business activity for the purposes of this
chapter."

����
SECTION
17
.
�
Section
231-8.5, Hawaii Revised Statutes, is amended by amending subsection (b) to read
as follows:

����
"
(b)
�
If the requirements of subsection (c) are
satisfied, the department may require electronic filing of any tax return,
application, report, or other document required under the provisions of title
14 administered by the department for the following taxpayers:

����
(1)
�
For withholding tax filings required under
chapter 235, only employers whose total tax liability under sections 235-61 and
235-62 for the calendar or fiscal year exceeds $40,000;

����
(2)
�
For income tax filings required under chapter
235, only taxpayers who are subject to tax under section 235-71, 235-71.5, or
235-72;

����
(3)
�
For general excise tax filings required under
chapter 237, only taxpayers whose total tax liability under chapter 237 for the
calendar or fiscal year exceeds $4,000;

����
(4)
�
For transient accommodations tax filings
required under chapter 237D, only operators and plan managers whose total tax
liability under chapter 237D for the calendar or fiscal year exceeds $4,000;
and

����
(5)
�
For filings required under the following
chapters, all taxpayers subject to tax under those chapters:

���������
(A)
�
236E;

���������
(B)
�
239;

���������
(C)
�
241;

���������
(D)
�
243;

���������
(E)
�
244D;

���������
(F)
�
245; [
and
]

���������
(G)
�
251[
.
]
; and

���������
(H)
�
B.
"

����
SECTION
18
.
�
Section
235-2.4, Hawaii Revised Statutes, is amended by amending subsection (v) to read
as follows:

����
"
(v)
�

Section 280E (with respect to expenditures in connection with the
illegal sale of drugs) of the Internal Revenue Code shall be operative for the
purposes of this chapter[
, except
]
; provided
that section 280E
shall not be operative with respect to the [
production
]
cultivation,
processing,
and sale of [
medical
] cannabis [
and manufactured
cannabis products
] by [
dispensaries
]
cannabis businesses

licensed
or permitted
under chapter [
329D and their subcontractors,
as defined in section 329D-1.
]
A.
�

For the purposes of this subsection, "cannabis" has the same
meaning as defined in section A-3.
"

����
SECTION
19
.
�
Section
237-24.3, Hawaii Revised Statutes, is amended to read as follows:

����
"
�237-24.3
�
Additional amounts not taxable.
�

In addition to the amounts not taxable under section 237-24, this
chapter shall not apply to:

����
(1)
�
Amounts received
from the loading, transportation, and unloading of agricultural commodities
shipped for a producer or produce dealer on one island of this State to a
person, firm, or organization on another island of this State.
�
[
The terms
]
For the purposes of
this paragraph,
"agricultural commodity", "producer",
and "produce dealer" [
shall be defined in the same manner as they
are
]
have the same meaning as
defined in section 147-1; provided
that agricultural commodities need not have been produced in the State;

����
(2)
�
Amounts received
by the manager, submanager, or board of directors of:

���������
(A)
�
An association of
a condominium property regime established in accordance with chapter 514B or
any predecessor thereto; or

���������
(B)
�
A nonprofit
homeowners or community association incorporated in accordance with chapter
414D or any predecessor thereto and existing pursuant to covenants running with
the land,

���������
in reimbursement of sums paid
for common expenses;

����
(3)
�
Amounts received
or accrued from:

���������
(A)
�
The loading or
unloading of cargo from ships, barges, vessels, or aircraft, including
stevedoring services as defined in section 382-1,
regardless of
whether [
or
not
] the ships, barges, vessels, or aircraft travel between the State and
other states or countries or between the islands of the State;

���������
(B)
�
Tugboat services
including pilotage fees performed within the State, and the towage of ships,
barges, or vessels in and out of state harbors, or from one pier to another;

���������
(C)
�
The transportation
of pilots or governmental officials to ships, barges, or vessels offshore;
rigging gear; checking freight and similar services; standby charges; and use
of moorings and running mooring lines; and

���������
(D)
�
Wharfage and
demurrage imposed under chapter 266 that is paid to the department of
transportation;

����
(4)
�
Amounts received
by an employee benefit plan by way of contributions, dividends, interest, and
other income; and amounts received by a nonprofit organization or office, as
payments for costs and expenses incurred for the administration of an employee
benefit plan; provided that this exemption shall not apply to any gross rental
income or gross rental proceeds received after June 30, 1994, as income from
investments in real property in this State; [
and
] provided further that
gross rental income or gross rental proceeds from investments in real property
received by an employee benefit plan after June 30, 1994, under written
contracts executed [
prior to
]
before
July 1, 1994, shall not be
taxed until the contracts are renegotiated, renewed, or extended, or until
after December 31, 1998, whichever is earlier.
�

For the purposes of this paragraph, "employee benefit plan"
means any plan as defined in title 29 United States Code section 1002(3), as
amended;

����
(5)
�
Amounts received
for purchases made with United States Department of Agriculture food coupons
under the federal food stamp program, and amounts received for purchases made
with United States Department of Agriculture food vouchers under the Special
Supplemental Foods Program for Women, Infants and Children;

����
(6)
�
Amounts received
by a hospital, infirmary, medical clinic, health care facility, pharmacy, or a
practitioner licensed to administer the drug to an individual for selling
prescription drugs or prosthetic devices to an individual; provided that this
paragraph shall not apply to any amounts received for services provided in
selling prescription drugs or prosthetic devices.
�
As used in this paragraph:

��������������
"Prescription
drugs" are those drugs defined under section 328-1 and dispensed by
filling or refilling a written or oral prescription by a practitioner licensed
under law to administer the drug and sold by a licensed pharmacist under
section 328-16 or practitioners licensed to administer drugs; provided that
"prescription drugs" shall not include
any
cannabis [
or
manufactured cannabis products
] authorized pursuant to [
chapters 329 and
329D; and
]
chapter A.

��������������
"Prosthetic
device" means any artificial device or appliance, instrument, apparatus,
or contrivance, including their components, parts, accessories, and
replacements thereof, used to replace a missing or surgically removed part of
the human body, which is prescribed by a licensed practitioner of medicine,
osteopathy, or podiatry and that is sold by the practitioner or that is
dispensed and sold by a dealer of prosthetic devices; provided that
"prosthetic device" shall not mean any auditory, ophthalmic, dental,
or ocular device or appliance, instrument, apparatus, or contrivance;

����
(7)
�
Taxes on transient
accommodations imposed by chapter 237D and passed on and collected by operators
holding certificates of registration under that chapter;

����
(8)
�
Amounts received
as dues by an unincorporated merchants association from its membership for
advertising media, promotional, and advertising costs for the promotion of the
association for the benefit of its members as a whole and not for the benefit
of an individual member or group of members less than the entire membership;

����
(9)
�
Amounts received
by a labor organization for real property leased to:

���������
(A)
�
A labor
organization; or

���������
(B)
�
A trust fund
established by a labor organization for the benefit of its members, families,
and dependents for medical or hospital care, pensions on retirement or death of
employees, apprenticeship and training, and other membership service programs.

���������
As used in this paragraph,
"labor organization" means a labor organization exempt from federal
income tax under section 501(c)(5) of the Internal Revenue Code, as amended;

���
(10)
�
Amounts received
from foreign diplomats and consular officials who are holding cards issued or
authorized by the United States Department of State granting them an exemption
from state taxes;

���
(11)
�
Amounts received
as rent for the rental or leasing of aircraft or aircraft engines used by the
lessees or renters for interstate air transportation of passengers and
goods.
�
For purposes of this paragraph,
payments made pursuant to a lease shall be considered rent regardless of
whether the lease is an operating lease or a financing lease.
�
[
The definition of
]
As used in this
paragraph,
"interstate air transportation" [
is
]
has

the same
meaning
as in
title
49 [
U.S.C.
]
United States
Code
section 40102; [
and
]

���
(12)
�
Amounts received
by a hospital, infirmary, medical clinic, health care facility, or pharmacy, or
a medical or dental practitioner, for [
healthcare-related
]
health
care-related
goods or services purchased under the medicare, medicaid, or
TRICARE programs.
�
For the purposes of
this paragraph, the [
healthcare-related
]
health care-related

services need not be performed by a medical or dental practitioner but may be
performed by a physician's assistant, nurse, or other employee under the
medical or dental practitioner's direction.
�

As used in this paragraph:

��������������
"Medicaid" means
the program established under Title XIX of the Social Security Act of 1935, as
amended[
;
]
.

��������������
"Medical or dental practitioner"
means a physician or osteopathic physician licensed pursuant to chapter 453; a
dentist licensed under chapter 448; an advanced practice registered nurse
licensed pursuant to chapter 457; or a pharmacist licensed pursuant to chapter
461[
;
]
.

��������������
"Medicare" means
the program established under Title XVIII of the Social Security Act of 1935,
as amended[
; and
]
.

��������������
"TRICARE" means
the program of the Department of Defense military health system managed by the
Defense Health Agency, or any successor program[
.
]
; and

���
(13)
�
Amounts
received from:

���������
(A)
�
Sales
of cannabis, whether made at retail or wholesale;

���������
(B)
�
Sales
of medical cannabis; and

���������
(C)
�
Taxes
on the retail sale of cannabis or sale of medical cannabis imposed by chapter B
and passed on and collected by persons holding permits under chapter B.
"

����
SECTION
20
.
�
Section 245-1,
Hawaii Revised Statutes, is amended by amending the definition of
"e-liquid" to read as follows:

����
"
"E-liquid" means any
liquid or like substance, which may or may not contain nicotine, that is
designed or intended to be used in an electronic smoking device, whether or not
packaged in a cartridge or other container.

����
"E-liquid" does not
include:

����
(1)
�
Prescription
drugs;

����
(2)
�
Cannabis [
for
medical use pursuant to chapter 329 or manufactured
]
,
cannabis
products
, or cannabis accessories authorized
pursuant to chapter [
329D;
]

A;
or

����
(3)
�
Medical devices
used to aerosolize, inhale, or ingest prescription drugs[
, including
manufactured cannabis products described in section 329D-10
]."

����
SECTION
21
.
�
Section 322-1,
Hawaii Revised Statutes, is amended to read as follows:

����
"
�322-1
�
Prevention; abatement; destruction; removal[
.
]
;
definition.
�
(a)
�
The department of health and its agents shall
examine into all nuisances, such as foul or noxious odors, gases or vapors,
water in which mosquito larvae exist, sources of filth, and all causes of
sickness or disease, on shore, and in any vessel, [
which
]
that

may be known to [
them
]
the department
or brought to [
their
]

the department's
attention, that in [
their
]
the department's

opinion are dangerous or injurious to public health or environmental health, or
both, and into any and all conditions created or existing that cause or tend to
be dangerous or injurious to public health or environmental health, or both,
and shall prevent, abate, destroy, or remove the nuisance or condition that
causes a nuisance.

����
(b)
�
For purposes of this part:

����
"Cannabis product" has
the same meaning as defined in section A-3.

����
"Hemp product" has the
same meaning as defined in section A-3.

����
"Nuisance" does not
include a cannabis product or hemp product or any foul or noxious odor, gas, or
vapor derived from a cannabis product or hemp product.
"

����
SECTION
22
.
�
Section
329-43.5, Hawaii Revised Statutes, is amended to read as follows:

����
"
�329-43.5
�
Prohibited acts
related to drug paraphernalia.
�
(a)
�
Except as provided in [
subsection
]
subsections

(e)[
,
]
and (f),
it [
is
]
shall be
unlawful for any
person to use, or to possess with intent to use, drug paraphernalia to plant,
propagate, cultivate, grow, harvest, manufacture, compound, convert, produce,
process, prepare, test, analyze, pack, repack, store, contain, conceal, inject,
ingest, inhale, or otherwise introduce into the human body a controlled
substance in violation of this chapter.
�

A violation of this subsection shall constitute a violation subject to a
fine of no more than $500.

����
(b)
�

Except as provided in subsection (e), it [
is
]
shall be

unlawful for any person to deliver, possess with intent to deliver, or
manufacture with intent to deliver drug paraphernalia, knowing or under
circumstances where one reasonably should know, that it will be used to plant,
propagate, cultivate, grow, harvest, manufacture, compound, convert, produce,
process, prepare, test, analyze, pack, repack, store, contain, conceal, inject,
ingest, inhale, or otherwise introduce into the human body a controlled substance
in violation of this chapter.
�
A
violation of this subsection shall constitute a violation subject to a fine of
no more than $500.

����
(c)
�

Any person eighteen years of age or [
over
]
older
who
violates subsection (b) by delivering drug paraphernalia to a person or persons
under eighteen years of age who are at least three years younger than that
adult person [
is
]
shall be
guilty of a class B felony and upon
conviction may be imprisoned pursuant to section 706-660 and, if appropriate as
provided in section 706-641, fined pursuant to section 706-640.

����
(d)
�

It [
is
]
shall be
unlawful for any person to place in any
newspaper, magazine, handbill, or other publication any advertisement, knowing
or under circumstances where one reasonably should know, that the purpose of
the advertisement, in whole or in part, is to promote the sale of objects
designed or intended for use as drug paraphernalia.
�
Any person who violates this section [
is
]

shall be
guilty of a class C felony and upon conviction may be
imprisoned pursuant to section 706-660 and, if appropriate as provided in
section 706-641, fined pursuant to section 706-640.

����
(e)
�

Subsections (a) and (b) shall not apply to a person who is [
authorized
to:

����
(1)
�
Acquire,
possess, cultivate, use, distribute, or transport cannabis pursuant to the
definition of "medical use" under section 329-121, while the person
is facilitating the medical use of cannabis by a qualifying patient; or

����
(2)
�
Dispense,
manufacture, or produce cannabis or manufactured cannabis products pursuant to
and in compliance with chapter 329D, while the person is facilitating the
medical use of cannabis by a qualifying patient pursuant to part IX of chapter
329.
]
acting in strict compliance with chapter A with respect to
cannabis.

����
(f)
�
Upon the effective date of section A-51,
subsection (a) shall not apply to the possession of drug paraphernalia to:

����
(1)
�
Store, contain,
or conceal; or

����
(2)
�
Inject, ingest,
inhale, or otherwise introduce into the human body,

marijuana.
"

����
SECTION
23
.
�
Section
378-2.5, Hawaii Revised Statutes, is amended by amending subsection (d) to read
as follows:

����
"
(d)
�
Notwithstanding
subsections (b) and (c), the requirement that inquiry into and consideration of
a prospective employee's conviction record may take place only after the
individual has received a conditional job offer, and the limitation to the most
recent seven-year period for felony convictions and the most recent five-year
period for misdemeanor convictions, excluding the period of incarceration,
shall not apply to employers who are expressly permitted to inquire into an
individual's criminal history for employment purposes pursuant to any federal
or state law other than subsection (a), including:

����
(1)
�
The
State or any of its branches, political subdivisions, or agencies pursuant to
sections 78-2.7 and 831-3.1; provided that any state law permitting the State
and any of its branches, political subdivisions, agencies, or semi-autonomous
public bodies corporate and politic to conduct more extensive inquiries into an
individual's criminal history for employment purposes than those permitted
under this section shall prevail;

����
(2)
�
The
department of education pursuant to section 302A-601.5;

����
(3)
�
The
department of health with respect to employees, providers, or subcontractors in
positions that place them in direct contact with clients when providing
non-witnessed direct mental health services pursuant to section 321-171.5;

����
(4)
�
The
judiciary pursuant to section 571-34;

����
(5)
�
The
counties pursuant to section 846-2.7(b)(5), (33), (34), (35), (36), and (38);

����
(6)
�
Armed
security services pursuant to section 261-17(b);

����
(7)
�
Providers
of a developmental disabilities domiciliary home pursuant to section 321-15.2;

����
(8)
�
Private
schools pursuant to sections 302C-1 and 378-3(8);

����
(9)
�
Financial
institutions in which deposits are insured by a federal agency having
jurisdiction over the financial institution pursuant to section 378-3(9);

���
(10)
�
Detective
agencies and security guard agencies pursuant to sections 463-6(b) and
463-8(b);

���
(11)
�
Employers
in the business of insurance pursuant to section 431:2-201.3;

���
(12)
�
Employers
of individuals or supervisors of individuals responsible for screening
passengers or property under title 49 United States Code section 44901 or
individuals with unescorted access to an aircraft of an air carrier or foreign
carrier or in a secured area of an airport in the United States pursuant to
title 49 United States Code section 44936(a);

���
(13)
�
The
department of human services pursuant to sections 346-2.5, 346-97, and 352-5.5;

���
(14)
�
The
public library system pursuant to section 302A-601.5;

���
(15)
�
The
department of law enforcement pursuant to section 353C-5;

���
(16)
�
The
board of directors of a cooperative housing corporation or the manager of a
cooperative housing project pursuant to section 421I-12;

���
(17)
�
The
board of directors of an association under chapter 514B, or the managing agent
or resident manager of a condominium pursuant to section 514B-133;

���
(18)
�
The department of
health pursuant to section 321-15.2
;
[
and
]

���
(19)
�
The department of
corrections and rehabilitation pursuant to section 353-1.5[
.
]
;

���
(20)
�
The Hawaii
cannabis and hemp office pursuant to section A-24; and

���
(21)
�
A licensed
business pursuant to section A-74.
"

����
SECTION
24
.
�
Section
421J-16, Hawaii Revised Statutes, is amended to read as follows:

����
"
�421J-16
�
Medical cannabis;
discrimination.
�
A provision in any
association document allowing for any of the discriminatory practices listed in
section 515-3(a)(1) to (7) against a person residing in a unit who has a valid [
certificate
]

medical cannabis registration card
for the medical use of cannabis as
provided in section [
329-123
]
A-47
in any form is void, unless
the association document prohibits the smoking of tobacco and the medical
cannabis is used by means of smoking.
�

Nothing in this section shall be construed to diminish the obligation of
a planned community association to provide reasonable accommodations for
persons with disabilities pursuant to section 515-3(a)(9)."

����
SECTION
25
.
�
Section 453-8,
Hawaii Revised Statutes, is amended by amending subsection (a) to read as
follows:

����
"(a)
�
In addition to any other actions authorized
by law, any license to practice medicine and surgery may be revoked, limited,
or suspended by the board at any time in a proceeding before the board, or may
be denied, for any cause authorized by law, including but not limited to the
following:

����
(1)
�
Procuring, or
aiding or abetting in procuring, an abortion that is unlawful under the laws of
this State or that would be unlawful under the laws of this State if performed
within this State;

����
(2)
�
Employing any
person to solicit patients for one's self;

����
(3)
�
Engaging in false,
fraudulent, or deceptive advertising, including but not limited to:

���������
(A)
�
Making excessive
claims of expertise in one or more medical specialty fields;

���������
(B)
�
Assuring a
permanent cure for an incurable disease; or

���������
(C)
�
Making any
untruthful and improbable statement in advertising one's medical or surgical
practice or business;

����
(4)
�
Being habituated
to the excessive use of drugs or alcohol; or being addicted to, dependent on,
or a habitual user of a narcotic, barbiturate, amphetamine, hallucinogen, or
other drug having similar effects;

����
(5)
�
Practicing
medicine while the ability to practice is impaired by alcohol, drugs, physical
disability, or mental instability;

����
(6)
�
Procuring a
license through fraud, misrepresentation, or deceit, or knowingly permitting an
unlicensed person to perform activities requiring a license;

����
(7)
�
Professional
misconduct, hazardous negligence causing bodily injury to another, or manifest
incapacity in the practice of medicine or surgery;

����
(8)
�
Incompetence or
multiple instances of negligence, including but not limited to the consistent
use of medical service, which is inappropriate or unnecessary;

����
(9)
�
Conduct or
practice contrary to recognized standards of ethics of the medical profession
as adopted by the Hawaii Medical Association, the American Medical Association,
the Hawaii Association of Osteopathic Physicians and Surgeons, or the American
Osteopathic Association;

���
(10)
�
Violation of the
conditions or limitations upon which a limited or temporary license is issued;

���
(11)
�
Revocation,
suspension, or other disciplinary action by another state or federal agency of
a license, certificate, or medical privilege, except when the revocation,
suspension, or other disciplinary action was based on the provision or
assistance in receipt or provision of medical, surgical, pharmaceutical,
counseling, or referral services relating to the human reproductive system,
including but not limited to services relating to pregnancy, contraception, or
the termination of a pregnancy, so long as the provision or assistance in
receipt or provision of the services was
in accordance
with the laws of this State
or would have been in accordance with the laws
of this State if it occurred within this State;

���
(12)
�
Conviction,
whether by nolo contendere or otherwise, of a penal offense substantially
related to the qualifications, functions, or duties of a physician or
osteopathic physician, notwithstanding any statutory provision to the contrary,
except when the conviction was based on the provision or assistance in receipt
or provision of medical, surgical, pharmaceutical, counseling, or referral
services relating to the human reproductive system, including but not limited
to services relating to pregnancy, contraception, or the termination of a
pregnancy, so long as the provision or assistance in receipt or provision of
the services was in accordance with the laws of this State or would have been
in accordance with the laws of this State if it occurred within this State;

���
(13)
�
Violation of
chapter 329, the uniform controlled substances act, or any rule adopted
thereunder except as provided in section [
329-122;
]
A-49;

���
(14)
�
Failure to report
to the board, in writing, any disciplinary decision issued against the licensee
or the applicant in another jurisdiction within thirty days after the
disciplinary decision is issued; or

���
(15)
�
Submitting to or
filing with the board any notice, statement, or other document required under
this chapter[
, which
]
that
is false or untrue or contains any
material misstatement or omission of fact."

����
SECTION
26
.
�
Section
514B-113, Hawaii Revised Statutes, is amended to read as follows:

����
"
�
514B-113
�

Medical cannabis; discrimination.
�
A provision in any articles of incorporation, declaration,
bylaws, administrative rules, house rules, or association documents of a
condominium allowing for any of the discriminatory practices listed in section
515-3(a)(1) to (7) against a person residing in a unit who has a valid [
certificate
]

medical cannabis registration card
for the medical use of cannabis as
provided in section [
329-123
]
A-47
in any form is void, unless
the documents prohibit the smoking of tobacco and the medical cannabis is used
by means of smoking.
�
Nothing in this
section shall be construed to diminish the obligation of a condominium
association to provide reasonable accommodations for persons with disabilities
pursuant to section 515-3(a)(9).
"

����
SECTION
27
.
�
Section
521-39, Hawaii Revised Statutes, is amended to read as follows:

����
"
�521-39
�
Medical cannabis; tenant
use; eviction.
�
A provision in a
rental agreement allowing for eviction of a tenant who has a valid [
certificate
]

medical cannabis registration card
for the medical use of cannabis as
provided in section [
329-123
]
A-47
in any form is void, unless
the rental agreement allows for eviction for smoking tobacco and the medical cannabis
is used by means of smoking; provided that this section shall not apply where
the articles of incorporation, declaration, bylaws, administrative rules, house
rules, association documents, or a similar document of a condominium property
regime or planned community association prohibits the [
medical
] use of cannabis."

����
SECTION
28
.
�
Section
709-903.5, Hawaii Revised Statutes, is amended by amending subsection (1) to
read as follows:

����
"
(1)
�
Except as provided in
subsection (2), a person commits the offense of endangering the welfare of a
minor in the first degree if, having care or custody of a minor, the person:

����
(a)
�
Intentionally or
knowingly allows another person to inflict serious or substantial bodily injury
on the minor; or

����
(b)
�
Intentionally or
knowingly causes or permits the minor to inject, ingest, inhale, or otherwise
introduce into the minor's body any controlled substance listed in sections
329-14, 329-16, 329-18, and 329-20 that has not been prescribed by a physician
for the minor, except as permitted under section [
329-122.
]
A-41.
"

����
SECTION
29
.
�
Section
709-904, Hawaii Revised Statutes, is amended by amending subsection (1) to read
as follows:

����
"
(1)
�
Except as provided in
section 709-903.5(2), a person commits the offense of endangering the welfare
of a minor in the second degree if, having care or custody of a minor, the
person:

����
(a)
�
Recklessly allows
another person to inflict serious or substantial bodily injury on the minor; or

����
(b)
�
Recklessly causes
or permits the minor to inject, ingest, inhale, or otherwise introduce into the
minor's body any controlled substance listed in sections 329-14, 329-16,
329-18, and 329-20 that has not been prescribed by a physician for the minor,
except as permitted under section [
329-122.
]
A-41.
�
This subsection shall not apply to nursing
mothers who may cause the ingestion or introduction of detectable amounts of
any controlled substance listed in sections 329-14, 329-16, 329-18, and 329-20
to their minor children through breastfeeding."

����
SECTION
30
.
�
Section
712-1240.1, Hawaii Revised Statutes, is amended by amending subsection (2) to
read as follows:

����
"(2)
�
It [
is
]
shall be
an affirmative
defense to prosecution for any marijuana-related offense defined in this part
that the person who possessed or distributed the marijuana was authorized to
possess or distribute the marijuana [
for medical purposes pursuant to part
IX of chapter 329.
]
pursuant to chapter A.
"

����
SECTION
31
.
�
Section
712-1244, Hawaii Revised Statutes, is amended by amending subsection (1) to
read as follows:

����
"(1)
�
A person commits the offense of promoting a
harmful drug in the first degree if the person knowingly:

����
(a)
�
Possesses one
hundred or more capsules or tablets or dosage units containing one or more of
the harmful drugs or one or more of the marijuana concentrates, or any
combination thereof;

����
(b)
�
Possesses one or
more preparations, compounds, mixtures, or substances, of an aggregate weight
of one ounce or more containing one or more of the harmful drugs or one or more
of the marijuana concentrates, or any combination thereof;

����
(c)
�
Distributes
twenty-five or more capsules or tablets or dosage units containing one or more
of the harmful drugs or one or more of the marijuana concentrates, or any
combination thereof;

����
(d)
�
Distributes one or
more preparations, compounds, mixtures, or substances, of an aggregate weight
of one-eighth ounce or more, containing one or more of the harmful drugs or one
or more of the marijuana concentrates, or any combination thereof; [
or
]

����
(e)
�
Distributes any
harmful drug [
or any marijuana concentrate
] in any amount to a minor[
.
]
;
or

����
(f)
�
Distributes any
marijuana concentrate in any amount to a person under the age of twenty-one.
"

����
SECTION
32
.
�
Section
712-1246.5, Hawaii Revised Statutes, is amended by amending subsection (2) to
read as follows:

����
"(2)
�
Promoting a harmful drug in the fourth degree
[
is
]
shall be
a misdemeanor[
.
]
; provided that
possession of one or more preparations, compounds, mixtures, or substances
containing more than five grams of marijuana concentrate shall be a petty
misdemeanor; provided further that possession of one or more preparations,
compounds, mixtures, or substances containing up to five grams of marijuana
concentrate shall be a violation, punishable by a fine of $25.
�
A person found responsible for a violation
under this section may request, and shall be granted, a penalty of up to two
hours of community service in lieu of a fine.
�

Whenever a court sentences a person under twenty-one years old pursuant
to this section, it shall also require that the person be referred for an
assessment by a certified substance abuse counselor of the person's substance
abuse or dependence and the need for appropriate treatment.
�
The counselor shall submit a report with a
recommendation to the court.
�
The court
shall require the person to obtain appropriate treatment if the counselor's
assessment establishes the person's substance abuse or dependence.
�
All costs for assessment and treatment shall
be borne by the person or, if the person is under the age of eighteen, by the
person's parent or guardian.
"

����
SECTION
33
.
�
Section
712-1249, Hawaii Revised Statutes, is amended to read as follows:

����
"
�712-1249
�
Promoting a detrimental drug in the third
degree.
�
(1)
�
A
person commits the offense of promoting a detrimental drug in the third degree
if [
the
]
:

����
(a)
�
The
person
knowingly possesses any marijuana or any Schedule V substance in any amount[
.
]
;
or

����
(b)
�
Smokes
marijuana in a public place.

����
(2)
�

Promoting a detrimental drug in the third degree [
is
]
shall be

a petty misdemeanor; provided that [
possession of three grams or less of
marijuana is a violation, punishable by a fine of $130.
]
:

����
(a)
�
The following shall be
a violation, punishable by a fine of $25:

���������
(i)
�
Possession
of one or more preparations, compounds, mixtures, or substances containing any
marijuana
, with a
n
aggregate weight of u
p
to one ounce; or

��������
(ii)
�
Possession, within a person's private residence only,
of
one or more preparations, compounds, mixtures, or substances
with a
n aggregate weight
of up to ten ounces containing any marijuana
produced by the person's personal cultivation of marijuana; provided further
that regardless of the number of persons residing at the private residence, the
total amount of preparations, compounds, mixtures, or substances containing any
marijuana shall not exceed an aggregate weight of two pounds.

���������
A person found responsible for a
violation under this paragraph may request, and shall be granted, a penalty of
up to two hours of community service in lieu of a fine; and

����
(b)
�
Smoking
marijuana in a public place shall be a violation, punishable by a fine of up to
$130.
�
A person found responsible for a
violation under this paragraph may request, and shall be granted, a penalty of
up to ten hours of community service in lieu of a fine.

Whenever
a court sentences a person under twenty-one years old pursuant to this section,
it shall also require that the person be referred for an assessment by a
certified substance abuse counselor of the person's substance abuse or
dependence and the need for appropriate treatment.
�
The counselor shall submit a report with a
recommendation to the court.
�
The court
shall require the person to obtain appropriate treatment if the counselor's
assessment establishes the person's substance abuse or dependence.
�
All costs for assessment and treatment shall
be borne by the person or, if the person is under the age of eighteen, by the
person's parent or guardian.
"

����
SECTION
34
.
�
Section
712A-4, Hawaii Revised Statutes, is amended to read as follows:

����
"
�712A-4
�
Covered offenses.
�
Offenses for which property is subject to
forfeiture under this chapter are:

����
(a)
�
All offenses that specifically
authorize forfeiture;

����
(b)
�
Murder; kidnapping; labor trafficking;
unlicensed sale of liquor; unlicensed manufacture of liquor; gambling; criminal
property damage; robbery; bribery; extortion; theft; unauthorized entry into
motor vehicle; burglary; money laundering; trademark counterfeiting; insurance
fraud; promoting a dangerous, harmful, or detrimental drug; commercial
promotion of marijuana; methamphetamine trafficking; manufacturing of a
controlled substance with a child present; promoting child abuse; promoting
prostitution; sex trafficking; commercial sexual exploitation of a minor;
habitual commercial sexual exploitation; or electronic enticement of a child
that is chargeable as a felony offense under state law;

����
(c)
�
The manufacture, sale, or distribution
of a controlled substance in violation of chapter 329, promoting detrimental
drugs or intoxicating compounds, promoting pornography, promoting pornography
for minors, or commercial sexual exploitation near schools or public parks,
which is chargeable as a felony or misdemeanor offense, but not as a petty
misdemeanor, under state law;
provided that the activities authorized under
chapter A shall not be subject to forfeiture under this chapter;

����
(d)
�
The attempt, conspiracy, solicitation,
coercion, or intimidation of another to commit any offense for which property
is subject to forfeiture
; and

����
(e)
�

Criminal trespass on agricultural land as defined in section 708- ."

����
SECTION
35
.
�
Section
846-2.7, Hawaii Revised Statutes, is amended by amending subsection (b) to read
as follows:

����
"
(b)
�
Criminal history record checks may be
conducted by:

����
(1)
�
The department of health or its
designee on operators of adult foster homes for individuals with developmental
disabilities or developmental disabilities domiciliary homes and their employees,
as provided by section 321-15.2;

����
(2)
�
The department of health or its
designee on prospective employees, persons seeking to serve as providers, or
subcontractors in positions that place them in direct contact with clients when
providing non-witnessed direct mental health or health care services, as
provided by section 321-171.5;

����
(3)
�
The department of health or its
designee on all applicants for licensure or certification for, operators for,
prospective employees, adult volunteers, and all adults, except adults in care,
at healthcare facilities as defined in section 321-15.2;

����
(4)
�
The department of education on
employees, prospective employees, and teacher trainees in any public school in
positions that necessitate close proximity to children, as provided by section
302A-601.5;

����
(5)
�
The counties on employees and
prospective employees who may be in positions that place them in close
proximity to children in recreation or child care programs and services;

����
(6)
�
The county liquor commissions on
applicants for liquor licenses, as provided by section 281-53.5;

����
(7)
�
The county liquor commissions on
employees and prospective employees involved in liquor administration, law
enforcement, and liquor control investigations;

����
(8)
�
The department of human services on
operators and employees of child caring institutions, child placing
organizations, and resource family homes, as provided by section 346-17;

����
(9)
�
The department of human services on
prospective adoptive parents as established under section 346-19.7;

���
(10)
�
The department of human services or its
designee on applicants to operate child care facilities, household members of
the applicant, prospective employees of the applicant, and new employees and
household members of the provider after registration or licensure, as provided
by section 346-154, and persons subject to section 346-152.5;

���
(11)
�
The department of human services on
persons exempt pursuant to section 346-152 to be eligible to provide child care
and receive child care subsidies, as provided by section 346-152.5;

���
(12)
�
The department of health on operators
and employees of home and community-based case management agencies and
operators and other adults, except for adults in care, residing in community
care foster family homes, as provided by section 321-15.2;

���
(13)
�
The department of human services on
staff members of the Hawaii youth correctional facility, as provided by section
352-5.5;

���
(14)
�
The department of human services on
employees, prospective employees, and volunteers of contracted providers and
subcontractors in positions that place them in close proximity to youth when
providing services on behalf of the office of youth services or the Hawaii
youth correctional facility, as provided by section 352D-4.3;

���
(15)
�
The judiciary on employees and
applicants at detention and shelter facilities, as provided by section 571-34;

���
(16)
�
The department of corrections and
rehabilitation on employees and prospective employees, volunteers, contract
service providers, and subcontract service providers who are directly involved
with the treatment and care of, or directly involved in providing correctional
programs and services to, persons committed to a correctional facility, or
placed in close proximity to persons committed when providing services on
behalf of the department or the correctional facility, as provided by section
353-1.5, and the department of law enforcement on employees and prospective
employees whose duties involve or may involve the exercise of police powers
including the power of arrest, as provided by section 353C-5;

���
(17)
�
The board of private detectives and
guards on applicants for private detective or private guard licensure, as
provided by section 463-9;

���
(18)
�
Private schools and designated
organizations on employees and prospective employees who may be in positions
that necessitate close proximity to children; provided that private schools and
designated organizations receive only indications of the states from which the
national criminal history record information was provided pursuant to section
302C-1;

���
(19)
�
The public library system on employees
and prospective employees whose positions place them in close proximity to
children, as provided by section 302A-601.5;

���
(20)
�
The State or any of its branches,
political subdivisions, or agencies on applicants and employees holding a
position that has the same type of contact with children, vulnerable adults, or
persons committed to a correctional facility as other public employees who hold
positions that are authorized by law to require criminal history record checks
as a condition of employment, as provided by section 78-2.7;

���
(21)
�
The department of health on licensed
adult day care center operators, employees, new employees, subcontracted
service providers and their employees, and adult volunteers, as provided by
section 321-15.2;

���
(22)
�
The department of human services on
purchase of service contracted and subcontracted service providers and their
employees and volunteers, as provided by sections 346-2.5 and 346-97;

���
(23)
�
The department of human services on
foster grandparent program, senior companion program, and respite companion
program participants, as provided by section 346-97;

���
(24)
�
The department of human services on
contracted and subcontracted service providers and their current and
prospective employees that provide home and community-based services under
section 1915(c) of the Social Security Act, title 42 United States Code section
1396n(c), or under any other applicable section or sections of the Social
Security Act for the purposes of providing home and community-based services,
as provided by section 346-97;

���
(25)
�
The department of commerce and consumer
affairs on proposed directors and executive officers of a bank, savings bank,
savings and loan association, trust company, and depository financial services
loan company, as provided by section 412:3-201;

���
(26)
�
The department of commerce and consumer
affairs on proposed directors and executive officers of a nondepository
financial services loan company, as provided by section 412:3-301;

���
(27)
�
The department of commerce and consumer
affairs on the original chartering applicants and proposed executive officers
of a credit union, as provided by section 412:10-103;

���
(28)
�
The department of commerce and consumer
affairs on:

���������
(A)
�
Each principal of every non-corporate
applicant for a money transmitter license;

���������
(B)
�
Each person who upon approval of an
application by a corporate applicant for a money transmitter license will be a
principal of the licensee; and

���������
(C)
�
Each person who upon approval of an
application requesting approval of a proposed change in control of licensee
will be a principal of the licensee,

���������
as
provided by sections 489D-9 and 489D-15;

���
(29)
�
The department of commerce and consumer
affairs on applicants for licensure and persons licensed under title 24;

���
(30)
�
The Hawaii health systems corporation
on:

���������
(A)
�
Employees;

���������
(B)
�
Applicants seeking employment;

���������
(C)
�
Current or prospective members of the
corporation board or regional system board; or

���������
(D)
�
Current or prospective volunteers,
providers, or contractors,

���������
in
any of the corporation's health facilities, as provided by section 323F-5.5;

���
(31)
�
The department of commerce and consumer
affairs on:

���������
(A)
�
An applicant for a mortgage loan
originator license, or license renewal; and

���������
(B)
�
Each control person, executive officer,
director, general partner, and managing member of an applicant for a mortgage
loan originator company license or license renewal,

���������
as
provided by chapter 454F;

���
(32)
�
The state public charter school
commission or public charter schools on employees, teacher trainees,
prospective employees, and prospective teacher trainees in any public charter
school for any position that places them in close proximity to children, as
provided in section 302D-33;

���
(33)
�
The counties on prospective employees
who work with children, vulnerable adults, or senior citizens in
community-based programs;

���
(34)
�
The counties on prospective employees
for fire department positions that involve contact with children or vulnerable
adults;

���
(35)
�
The counties on prospective employees
for emergency medical services positions that involve contact with children or
vulnerable adults;

���
(36)
�
The counties on prospective employees
for emergency management positions and community volunteers whose
responsibilities involve planning and executing homeland security measures
including viewing, handling, and engaging in law enforcement or classified meetings
and assisting vulnerable citizens during emergencies or crises;

���
(37)
�
The State and counties on employees,
prospective employees, volunteers, and contractors whose position
responsibilities require unescorted access to secured areas and equipment
related to a traffic management center;

���
(38)
�
The State and counties on employees and
prospective employees whose positions involve the handling or use of firearms
for other than law enforcement purposes;

���
(39)
�
The State and counties on current and
prospective systems analysts and others involved in an agency's information
technology operation whose position responsibilities provide them with access
to proprietary, confidential, or sensitive information;

���
(40)
�
The department of commerce and consumer
affairs on:

���������
(A)
�
Applicants for real estate appraiser
licensure or certification, as provided by chapter 466K;

���������
(B)
�
Each person who owns more than ten per
cent of an appraisal management company who is applying for registration as an
appraisal management company, as provided by section 466M-7; and

���������
(C)
�
Each of the controlling persons of an
applicant for registration as an appraisal management company, as provided by
section 466M-7;

���
(41)
�
The [
department of health or its
designee
]
Hawaii cannabis and hemp office
on
:

���������
(A)
�
[
Individual applicants or
individuals acting on behalf of applying entities for hemp processor permits,
as provided under section 328G-2;
]
Current or prospective employees,
contractors, and subcontractors and current or prospective employees of the
contractors and subcontractors of the Hawaii cannabis and hemp office, as
provided by section A-24;
and

���������
(B)
�
All
license
and
permit
applicants, [
licensees,
]
current or prospective

employees[
,
]
and
contractors[
, and prospective employees of
medical cannabis dispensaries, and individuals permitted to enter and remain in
medical cannabis dispensary facilities, as provided under sections
329D-15(a)(4) and 329D-16(a)(3);
]
of licensed businesses, and current or
prospective laboratory agents of independent laboratories, as provided by
section A-74;

���
(42)
�
The department of commerce and consumer
affairs on applicants for nurse licensure or license renewal, reactivation, or
restoration, as provided by sections 457-7, 457-8, 457-8.5, and 457-9;

���
(43)
�
The
county police departments on applicants for permits to acquire firearms
pursuant to section 134-2, on individuals registering their firearms pursuant
to section 134-3, and on applicants for new or renewed licenses to carry a
pistol or revolver and ammunition pursuant to section 134-9;

���
(44)
�
The department of commerce and consumer
affairs on:

���������
(A)
�
Each of the controlling persons of the
applicant for licensure as an escrow depository, and each of the officers,
directors, and principals who will be in charge of the escrow depository's
activities upon licensure; and

���������
(B)
�
Each of the controlling persons of an
applicant for proposed change in control of an escrow depository licensee, and
each of the officers, directors, and principals who will be in charge of the
licensee's activities upon approval of the application,

���������
as
provided by chapter 449;

���
(45)
�
The department of taxation on current
or prospective employees or contractors who have access to federal tax
information in order to comply with requirements of federal law, regulation, or
procedure, as provided by section 231-1.6;

���
(46)
�
The department of labor and industrial
relations on current or prospective employees or contractors who have access to
federal tax information in order to comply with requirements of federal law,
regulation, or procedure, as provided by section 383-110;

���
(47)
�
The department of human services on
current or prospective employees or contractors who have access to federal tax
information in order to comply with requirements of federal law, regulation, or
procedure, and on current or prospective employees, volunteers, contractors, or
contractors' employees or volunteers, subcontractors, or subcontractors'
employees or volunteers, whose position places or would place them in close
proximity to minors, young adults, or vulnerable adults, as provided by section
346-2.5;

���
(48)
�
The child support enforcement agency on
current or prospective employees, or contractors who have access to federal tax
information to comply with federal law, regulation, or procedure, as provided
by section 576D-11.5;

���
(49)
�
The department of the attorney general
on current or prospective employees, contractors, contractor's employees, or
subcontractors who have access to federal tax information to comply with
federal law, regulation, or procedure, as provided by section 28-17;

���
(50)
�
The department of commerce and consumer
affairs on each control person, executive officer, director, general partner,
and managing member of an installment loan licensee, or an applicant for an
installment loan license, as provided in chapter 480J;

���
(51)
�
The university of Hawaii on current and
prospective employees and contractors whose duties include ensuring the
security of campus facilities and persons;

���
(52)
�
The department of commerce and consumer
affairs on applicants for physician licensure or license renewal, through the
Interstate Medical Licensure Compact
,
as provided by section 453B-2; and

���
(53)
�
Any other organization, entity, or the
State, its branches, political subdivisions, or agencies as may be authorized
by state law.
"

����
SECTION 36.
�
Act 14, Session Laws of Hawaii 2020, as
amended by section 2 of Act 137, Session Laws of Hawaii 2022, as amended by
section 15 of Act 263, Session Laws of Hawaii 2023, is amended by amending
section 9 to read as follows:

����
"SECTION 9.
�
This Act shall take effect upon its approval,
and shall be repealed on July 1, [
2027;
]
2026;
provided that the
definition of "marijuana" in section 329�1, Hawaii Revised Statutes,
and the definitions of "marijuana" and "marijuana
concentrate" in section 712�1240, Hawaii Revised Statutes, shall be
reenacted in the form in which they read on the day prior to the effective date
of this Act."

����
SECTION 37.
�
Act 263, Session Laws of Hawaii 2023, is
amended by amending section 19 to read as follows:

����
"SECTION 19.
�
This Act shall take effect on July 1, 2023,
and shall be repealed on July 1, [
2027.
]
2026.
"

����
SECTION 38.
�
Act 110, Session Laws of Hawaii 2024, is
amended by amending section 4 to read as follows:

����
"SECTION 4.
�
This Act shall take effect upon its approval[
;
provided that on July 1, 2027, this Act shall be repealed and section 846-2.7,
Hawaii Revised Statutes, shall be reenacted in the form in which it read on the
day prior to the effective date of this Act
]."

����
SECTION
39
.
�
Act 241,
Session Laws of Hawaii 2025, is amended as follows:

����
1.
�

By amending sections 16 and 17 to read:

����
"SECTION 16.
�
[
The purpose of this part is to prohibit
the cultivation of cannabis without a cannabis cultivator license issued by the
department of health.
]
Repealed.

����
SECTION 17.
�
[
Chapter 329D, Hawaii Revised Statutes, is
amended by adding a new section to be appropriately designated and to read as
follows:

����
"
�329D-
�
Cannabis cultivator; license required.
�
(a)
�

Notwithstanding section 329D-24, it shall be unlawful for any person to
cultivate cannabis without a license issued by the department pursuant to this
section.

����
(b)
�
A cannabis cultivator license shall authorize
the licensee to:

����
(1)
�
Acquire and
cultivate cannabis plants, seeds, cuttings, or clones; and

����
(2)
�
Distribute
cannabis plants and cannabis flower to a medical cannabis dispensary.

����
(c)
�
The department shall issue no more than one
cannabis cultivator license for each person.

����
(d)
�
A person issued a cannabis cultivator license
under this section shall meet all production facility and processing requirements
of this chapter.
]
Repealed.
"

����
2.
�

By amending section 20 to read:

����
"SECTION 20.
�
This Act shall take effect on July 1, 2025;
provided that part IV of this Act shall take effect on [
January 1, 2028;
]

July 1, 2026;
provided further that the amendments made to section 453-1.3(c),
Hawaii Revised Statutes, by section 9 of this Act shall not be repealed when
that section is reenacted on December 31, 2025, pursuant to section 8 of Act
107, Session Laws of Hawaii 2023."

����
SECTION
40.
�
Act 269, Session Laws of Hawaii
2025, is amended by amending section 11 to read as follows:

����
"SECTION 11.
�
This Act shall take effect on July 1, 2025[
.
]
;
provided that on July 1, 2026, this Act shall be repealed and section 712-1270,
Hawaii Revised Statutes, shall be reenacted in the form in which it read on the
day prior to the effective date of this Act.
"

����
SECTION
41
.
�
Section
321-30.1, Hawaii Revised Statutes, is repealed.

����
["
�321-30.1
�
Medical cannabis
registry and regulation special fund; established.
�
(a)
�
There is established within the state
treasury the medical cannabis registry and regulation special fund.
�
The fund shall be expended at the discretion
of the director of health:

����
(1)
�
To establish
and regulate a system of medical cannabis dispensaries in the State;

����
(2)
�
To offset the
cost of the processing and issuance of patient registry identification
certificates and primary caregiver registration certificates;

����
(3)
�
To fund
positions and operating costs authorized by the legislature;

����
(4)
�
To establish
and manage a secure and confidential database;

����
(5)
�
To fund public
education as required by section 329D-26;

����
(6)
�
To fund
substance abuse prevention and education programs;

����
(7)
�
To fund
programs for the mitigation and abatement of nuisances relating to illegal
cannabis and hemp products and chapter 329D; and

����
(8)
�
For any other
expenditure necessary, consistent with this chapter and chapter 329D, to
implement medical cannabis registry and regulation programs.

����
(b)
�
The fund shall consist of all moneys derived
from fees collected pursuant to subsection (c) and section 329D-4.
�
There is established within the medical
cannabis registry and regulation special fund:

����
(1)
�
A medical
cannabis registry program sub-account, into which shall be deposited all fees
collected pursuant to subsection (c); and

����
(2)
�
A medical
cannabis dispensary program sub-account, into which shall be deposited all fees
collected pursuant to section 329D-4.

����
(c)
�
The department, upon completion of the
transfer of the medical use of cannabis program, shall charge a medical
cannabis registration fee to each qualifying patient, other than a qualifying
out-of-state patient, of no more than $35 per year.
"]

����
SECTION 42.
�
Chapter 329, part IX, Hawaii Revised
Statutes, is repealed.

����
SECTION 43.
�
Chapter 329D, Hawaii Revised Statutes, is
repealed.

PART VI

����
SECTION 44.
�
Licenses previously issued under chapters
328G or 329D, Hawaii Revised Statutes, shall remain in full force and effect
until the previously issued licenses expire on their own terms; provided that
the licensees shall be regulated under chapter A, Hawaii Revised Statutes, and
rules adopted pursuant to chapter A, Hawaii Revised Statutes.

����
SECTION 45.
�
(a)
�

Each existing medical cannabis dispensary whose license remains
effective pursuant to section 44 of this Act may convert their operation into
licenses under chapter A, Hawaii Revised Statutes, before January 1, 2027;
provided that the existing medical cannabis dispensary may only convert
existing licensed operations and premises; provided further that an existing
medical cannabis dispensary may only be issued up to three cannabis cultivator
licenses, three cannabis processor licenses, four medical cannabis dispensary
licenses, and four retail cannabis store licenses, but no more than ten
licenses in total, in accordance with chapter A, Hawaii Revised Statutes, and
rules adopted pursuant to chapter A, Hawaii Revised Statutes.

����
(b)
�

To convert an existing medical cannabis dispensary license into a
license or licenses under chapter A, Hawaii Revised Statutes, before the
expiration of the existing license, but no later than October 1, 2026, the
existing medical cannabis dispensary shall apply to the Hawaii cannabis and
hemp office, on forms prescribed by the office, and shall establish to the
office's satisfaction:

����
(1)
�
The existing
medical cannabis dispensary's existing ownership structure;

����
(2)
�
All persons with a
direct or indirect interest in the existing medical cannabis dispensary;

����
(3)
�
The existing
medical cannabis dispensary is currently in full compliance with the terms and
conditions under which the license was issued;

����
(4)
�
The existing
medical cannabis dispensary meets the application criteria required by chapter
A, Hawaii Revised Statutes, and rules adopted pursuant to chapter A, Hawaii
Revised Statutes;

����
(5)
�
The existing
medical cannabis dispensary is in compliance with any other requirements of
chapter A, Hawaii Revised Statutes, including the ownership restrictions; and

����
(6)
�
The existing
medical cannabis dispensary is capable of sustaining the product supply and
access for the registered qualifying patients they serve.

����
(c)
�

An existing medical cannabis dispensary shall pay a one-time conversion
fee of $50,000 per retail dispensing location being converted and $25,000 per
production facility being converted.

�
The one-time conversion fee may be paid in
separate installments; provided that the conversion fee shall be paid in full
on or before January 1, 2027.
�
If the
conversion fee is not paid by January 1, 2027, any license held by the licensee
shall be subject to revocation in accordance with chapter A, Hawaii Revised Statutes,
and rules adopted pursuant to chapter A, Hawaii Revised Statutes.

����
(d)
�

The Hawaii cannabis and hemp office shall audit the existing medical
cannabis dispensary ownership to ensure compliance with the ownership
restrictions in chapter A, Hawaii Revised Statutes.

����
(e)
�

Upon full or partial payment of the conversion fee, and a complete and
valid conversion application, the Hawaii cannabis and hemp office shall issue
licenses under chapter A, Hawaii Revised Statutes, for the premises and
operations of the existing medical cannabis dispensary that have been approved
for conversion by the office.
�
The
converted licenses shall be issued no later than January 1, 2027.

����
SECTION 46.
�
All functions of the department of health
office of medical cannabis control and regulation shall be transferred to the
Hawaii cannabis and hemp office.

����
All employees who occupy civil
service positions and whose functions are transferred by this Act shall retain
their civil service status, whether permanent or temporary.
�
Employees shall be transferred without loss of
salary, seniority (except as prescribed by collective bargaining agreements),
retention points, prior service credit, any vacation and sick leave credits
previously earned, and other rights, benefits, and privileges, in accordance
with state personnel laws and this Act; provided that the employees possess the
minimum qualifications and public employment requirements for the class or
position to which transferred or appointed, as applicable; provided further
that subsequent changes in status may be made pursuant to applicable civil
service and compensation laws.

����
Any employee who, before this Act,
is exempt from civil service and is transferred as a consequence of this Act
may continue to retain the employee's exempt status but shall not be appointed
to a civil service position because of this Act.
�
An exempt employee who is transferred by this
Act shall not suffer any loss of prior service credit, any vacation and sick
leave credits previously earned, or other employee benefits or privileges as a
consequence of this Act; provided that the employee possesses legal and public
employment requirements for the position to which transferred or appointed, as
applicable; provided further that subsequent changes in status may be made
pursuant to applicable employment and compensation laws.
�
The Hawaii cannabis and hemp office to which
the employee is transferred may prescribe the duties and qualifications of the
employees and fix their salaries without regard to chapter 76, Hawaii Revised
Statutes.

����
SECTION 47.
�
The program manager of the department of
health office of medical cannabis control and regulation shall serve as the
interim administrator of the Hawaii cannabis and hemp office until the governor
appoints an administrator.

����
SECTION 48.
�
All leases, contracts, loans, agreements,
permits, or other documents executed or entered into by or on behalf of the
department of health or department of agriculture pursuant to the provisions of
the Hawaii Revised Statutes that are reenacted or made applicable to the Hawaii
cannabis and hemp office by this Act shall remain in full force and
effect.
�
On the effective date of this
Act, every reference to the department of health, director of health,
department of agriculture, or chairperson of the board of agriculture in those
leases, contracts, loans, agreements, permits, or other documents shall be
construed as a reference to the Hawaii cannabis and hemp office or
administrator of the Hawaii cannabis and hemp office, as appropriate.

����
SECTION 49.
�
All appropriations, records, equipment,
machines, files, supplies, contracts, books, papers, documents, maps, and other
personal property heretofore made, used, acquired, or held by the department of
health or department of agriculture relating to the functions transferred to
the Hawaii cannabis and hemp office shall be transferred with the functions to
which they relate.

����
SECTION 50.
�
All rules, policies, procedures, guidelines,
and other material adopted or developed by the department of health or
department of agriculture to implement provisions of the Hawaii Revised
Statutes that are reenacted or made applicable to the Hawaii cannabis and hemp
office or administrator of the Hawaii cannabis and hemp office by this Act, as
appropriate, shall remain in full force and effect until amended or repealed by
the Hawaii cannabis and hemp office.
�
In
the interim, every reference to the department of health, director of health,
department of agriculture, or chairperson of the board of agriculture in those
rules, policies, procedures, guidelines, and other material shall be construed
as a reference to the Hawaii cannabis and hemp office or administrator of the
Hawaii cannabis and hemp office, as appropriate.

����
SECTION 51.
�
The right of appeal from administrative
actions or determinations as provided by law shall not be impaired by this
Act.
�
Except as otherwise provided by
this Act, whenever a right of appeal from administrative actions or
determinations is provided by law to or from any officer, board, department,
bureau, commission, administrative agency, or instrumentality of the State, or
any of the programs of which, that is transferred by this Act to the Hawaii
cannabis and hemp office or administrator of the Hawaii cannabis and hemp
office, as the case may be, the right of appeal shall lie to or from the Hawaii
cannabis and hemp office or administrator of the Hawaii cannabis and hemp
office, as the case may be, when the transfer is made.
�
The right of appeal shall exist to the same
extent and in accordance with the applicable procedures that are in effect
immediately before the effective date of the applicable part.

����
If the provisions of this section
relating to appeals cannot be effected by reason of abolishment, splitting, or
shifting of functions or otherwise, the right of appeal shall lie to the
circuit court of the State pursuant to the Hawaii rules of civil procedure.

����
SECTION 52.
�
Notwithstanding any other provision of law to
the contrary, from the effective date of this Act to December 31, 2028,
the Hawaii cannabis and hemp office shall be exempt from procurement
requirements under chapter 103D, Hawaii Revised Statutes, if the procurement is
for:

����
(1)
�
Banking services
for the Hawaii cannabis and hemp office or department of taxation, or both, to
collect fees and tax revenue;

����
(2)
�
Banking services
to help support cannabis businesses to transition from an all-cash system;

����
(3)
�
A consultant to
support the Hawaii cannabis and hemp office in the process for cannabis
licensure, including services related to investigations and the financial or
criminal history review of applicants or licensed businesses;

����
(4)
�
A consultant to
support the Hawaii cannabis and hemp office to draft rules to implement chapter
A, Hawaii Revised Statutes;

����
(5)
�
A consultant to
provide technical assistance regarding the social equity grant program;

����
(6)
�
Communication
services for public and consumer education campaigns on cannabis laws and rules
and potential health and safety risks associated with cannabis use;

����
(7)
�
Establishing a
state cannabis testing facility; and

����
(8)
�
A consultant to
support the Hawaii cannabis and hemp office in administering grant programs.

����
SECTION 53.
�
The following positions are established
within the Hawaii cannabis and hemp office:

����
(1)
�
Administrator;

����
(2)
�
Chief compliance
officer;

����
(3)
�
Chief equity
officer;

����
(4)
�
Chief financial
officer;

����
(5)
�
Chief public
health and education officer;

����
(6)
�
Chief technology
officer;

����
(7)
�
Executive
secretary to the administrator;

����
(8)
�
General counsel;
and

����
(9)
�
Hemp coordinator.

����
SECTION 54.
�
Any unexpended or unencumbered balance in
the:

����
(1)
�
Industrial hemp
special fund, established by section 141-14, Hawaii Revised Statutes;

����
(2)
�
Medical cannabis
registry and regulation special fund, established by section 321-30.1, Hawaii
Revised Statutes; and

����
(3)
�
Hawaii hemp
processing special fund, established by section 328G-7, Hawaii Revised
Statutes,

shall be transferred as of the close of business on
the effective date of this Act to the cannabis regulation and enforcement
special fund, established by section A-16, Hawaii Revised Statutes.

����
SECTION 55.
�
There is appropriated out of the cannabis
regulation and enforcement special fund the following sums or so much thereof
as may be necessary for fiscal year 2026-2027:

����
(1)
�
$
for the hiring and filling of full-time equivalent (
FTE) positions established by this Act and full-time
equivalent ( FTE) positions within the Hawaii cannabis
and hemp office established by this Act, the administration and enforcement of
the Hawaii Cannabis Law by the Hawaii cannabis and hemp office, and other
associated administrative costs;

����
(2)
�
$
for the implementation and associated administrative costs of the social equity
grant program established by this Act;

����
(3)
�
$
for the implementation and associated administrative costs of the public health
and education grant program established by this Act;

����
(4)
�
$
for the implementation and associated administrative costs of the public safety
grant program established by this Act; and

����
(5)
�
$
for the purposes of establishing a state cannabis testing facility within the
Hawaii cannabis and hemp office.

����
The sums appropriated shall be
expended by the Hawaii cannabis and hemp office for the purposes of this Act.

����
SECTION 56.
�
There is appropriated out of the cannabis
regulation and enforcement special fund the sum of
$ or so much
thereof as may be necessary for fiscal year 2026-2027 for grants awarded under the
social equity grant program established by this Act.

����
The sum
appropriated shall be expended by the office of community services of the
department of labor and industrial relations for the purposes of this Act.

����
SECTION
57.
�
There is appropriated out of the
cannabis regulation and enforcement special fund the sum of
$ or so much
thereof as may be necessary for fiscal year 2026-2027 for grants awarded under the
public health and education grant program established by this Act.

����
The sum
appropriated shall be expended by the office of community services of the
department of labor and industrial relations for the purposes of this Act.

����
SECTION
58.
�
There is appropriated out of the
cannabis regulation and enforcement special fund the sum of
$ or so much
thereof as may be necessary for fiscal year 2026-2027 for grants awarded under the
public safety grant program established by this Act.

����
The sum
appropriated shall be expended by the office of community services of the
department of labor and industrial relations for the purposes of this Act.

����
SECTION 59.
�
There is appropriated out of the cannabis
regulation and enforcement special fund the sum of
$ or so much
thereof as may be necessary for fiscal year 2026-2027 for grants awarded under the
Hawaii hemp grant program established by this Act.

����
The sum
appropriated shall be expended by the office of community services of the
department of labor and industrial relations for the purposes of this Act.

����
SECTION 60.
�
The following positions are established
within the department of the attorney general for the special investigation and
prosecution division to prevent the proliferation of money laundering and
organized crime that may result from the expansion of the legal cannabis market
or is related to fentanyl and methamphetamine:

����
(1)
�

full-time equivalent ( FTE) supervising deputy attorney
general position;

����
(2)
�

full-time equivalent ( FTE) deputy attorney general
position;

����
(3)
�

full-time equivalent ( FTE) administrative assistant
position;

����
(4)
�

full-time equivalent ( FTE) supervisory special agent
(investigator VI) position; and

����
(5)
�

full-time equivalent ( FTE) special agent (investigator
V) positions.

����
SECTION 61.
�
There is appropriated out of the general
revenues of the State of Hawaii the sum of $
or so much thereof as may be necessary for fiscal year 2026-2027 for the
department of the attorney general special investigation and prosecution
division to prevent the proliferation of money laundering and organized crime
that may result from the expansion of the legal cannabis market or is related
to fentanyl and methamphetamine, including the hiring and filling of the
full-time equivalent ( FTE) positions within the
department of the attorney general established by this Act, equipment costs,
and other associated administrative costs.

����
The sum appropriated shall be
expended by the department of the attorney general for the purposes of this
Act.

����
SECTION 62.
�
The following positions are established
within the department of taxation to implement part III of this Act:

����
(1)
�

full-time equivalent ( FTE) auditor positions;

����
(2)
�

full-time equivalent ( FTE) cashier position;

����
(3)
�

full-time equivalent ( FTE) special enforcement section
investigator positions;

����
(4)
�

full-time equivalent ( FTE) tax information technician
positions; and

����
(5)
�

full-time equivalent ( FTE) tax law change specialist
positions.

����
In filling these positions, the
director of taxation may appoint tax law change specialists who shall be subject
to chapter 76, Hawaii Revised Statutes.

����
SECTION 63.
�
There is appropriated out of the general
revenues of the State of Hawaii the sum of $
or so much thereof as may be necessary for fiscal year 2026-2027 for the
department of taxation to implement part III of this Act, including the hiring
and filling of the full-time equivalent (
FTE) positions within the department of taxation established by this Act, costs
for project management services, costs for building and security improvements,
and other associated administrative costs.

����
The sum appropriated shall be
expended by the department of taxation for the purposes of this Act.

����
SECTION 64.
�
The appropriations made by this Act shall not
lapse at the end of the fiscal biennium for which the appropriations are made;
provided that all moneys from the appropriations unencumbered as of June 30,
2028, shall lapse as of that date.

����
SECTION 65.
�
This Act shall not be applied to impair any
contract existing as of the effective date of this Act in a manner violative of
either the Hawaii State Constitution or Article I, section 10, of the United
States Constitution.

����
SECTION 66.
�
This Act shall not affect rights and duties
that matured, penalties and forfeitures that were incurred, and proceedings
that were begun before its effective date.

����
SECTION 67.
�
If any provision of this Act or the
application thereof to any person or circumstance is held invalid, the
invalidity does not affect other provisions or applications of the Act that can
be given effect without the invalid provision or application, and to this end
the provisions of this Act are severable.

����
SECTION 68.
�
If any part of this Act is found to be in
conflict with federal requirements that are a prescribed condition for the allocation
of federal funds to the State, the conflicting part of this Act is inoperative
solely to the extent of the conflict and with respect to the agencies directly
affected, and this finding does not affect the operation of the remainder of
this Act in its application to the agencies concerned.
�
The rules under this Act shall meet federal
requirements that are a necessary condition to the receipt of federal funds by
the State.

����
SECTION 69.
�
In codifying the new sections added by
sections 2, 4, and 7 of this Act, the revisor of statutes shall substitute
appropriate section numbers for the letters used in designating the new
sections in this Act.

����
SECTION 70.
�
Statutory material to be repealed is
bracketed and stricken.
�
New statutory
material is underscored.

����
SECTION 71.
�
This Act shall take effect on July 1, 2026;
provided that:

����
(1)
�
Sections A-51
through A-55, Hawaii Revised Statutes, of section 2 of this Act and sections
31, 32, and 33 of this Act
shall
take effect on the
earlier of:

���������
(A)
�
The
descheduling of marijuana under the federal Controlled Substances Act; the
removal of all federal criminal penalties for the acquisition, cultivation, dispensing,
distribution, possession, transportation, and use of marijuana by individuals
and entities; or the enactment of federal legislation that legalizes the
acquisition, cultivation, dispensing, distribution, possession, transportation,
and use of marijuana for adult use;

���������
(B)
�
The
enactment of federal legislation or the issuance of a final federal judicial
decision that delegates, affirms, or recognizes the authority of states to
regulate marijuana without being preempted by federal law; or

���������
(C)
�
The
ratification of an amendment to the Hawaii State Constitution legalizing
cannabis
; and

����
(2)
�
Part III of this Act
shall take effect on January 1, 2027
.

INTRODUCED BY:

_____________________________

Report Title:

DCCA;
DOH; DOA; DoTax; Hawaii Cannabis and Hemp Office; Adult-Use Cannabis; Medical
Cannabis; Hemp; Appropriations

Description:

Establishes
the Hawaii Cannabis and Hemp Office within the Department of Commerce and
Consumer Affairs to regulate all aspects of the cannabis plant.
�
Contingent upon specific changes at the
federal level or a state constitutional amendment, legalizes the personal adult
use of cannabis and decriminalizes certain marijuana-related offenses.
�
Beginning 1/1/2027, establishes taxes on
cannabis sales.
�
Adds new traffic
offenses relating to the consumption or possession of marijuana or marijuana
concentrate.
�
Transfers the personnel and
assets of the Department of Health and assets of the Department of Agriculture
relating to cannabis and hemp to the Hawaii Cannabis and Hemp Office.
�
Establishes various positions within state
entities.
�
Appropriates funds.

The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.