Closed-loop Payment Processing System for Marijuana Taxation and Sales

Summary

This BILL modifies medical marijuana control in order to provide for a closed-loop payment processing system administered by the Treasurer of State for marijuana sales and cultivator fees along with video surveillance of licensed entities.

Closed-loop Payment Processing System for Marijuana Taxation and Sales

Summary

This BILL modifies medical marijuana control in order to provide for a closed-loop payment processing system administered by the Treasurer of State for marijuana sales and cultivator fees along with video surveillance of licensed entities.

BE IT RESOLVED BY THE LEGISLATURE OF THE STATE OF {insert state}:

Section 1. Use of a closed-loop payment processing system

  • All financial transactions under the medical marijuana control program between

licensed medical marijuana cultivators or processors, licensed laboratories, licensed retail dispensaries, or registered patients and their caregivers shall be conducted via a closed-loop payment processing system established by the treasurer of state in accordance with this section. Only those forms of payment authorized under the system shall be utilized or accepted.

  • The Treasurer of State shall adopt rules that prescribe a closed-loop payment processing system under which the state creates accounts to be used only by registered patients and caregivers at licensed dispensaries as well as by all license holders under the Revised Code. The system shall include record-keeping and accounting functions performed on state-owned computer systems located on state-owned property that identify all parties involved in those transactions. The purpose of the system is to prevent all of the following:
  1. Revenue from the sale of marijuana from going to criminal enterprises, gangs, and cartels;
  2. The diversion of marijuana from a state where it is legal in some form under that state’s law to another state;
  3. The distribution of marijuana to minors;
  4. The use of state-authorized marijuana activity as a cover or pretext for the trafficking of other illegal drugs or for other illegal activity.
  • The treasurer of state shall create, or contract with a separate entity to create, an online computer network system through which all license holders under the Revised Code and registered patients and caregivers can access the closed-loop payment processing system and transact business electronically. The treasurer shall adopt rules under Chapter _________ of the Revised Code relative to the design and operation of the online computer network system and the manner in which payments made via the system are distributed.
  • The director of budget and management, at the request of the treasurer of state, shall deduct all of the following from the closed-loop payment processing system account of the appropriate license holder:
  1. Taxes owed the state;
  2. Fees assessed according to the Revised Code;
  3. The state’s percentage of the transaction fees, if any.
  • All money held by the state pursuant to the closed-loop payment processing system shall be deposited into the state treasury to the credit of the general revenue fund.
  • The information recorded by the closed-loop payment processing system is not a public record under the Revised Code but shall be fully accessible to the state board of pharmacy and all state and federal law enforcement agencies, including the United States department of the treasury’s financial crimes enforcement network.

Section 2: Cultivator Fees

  • As a condition the department of commerce shall assess each cultivator licensed a fee. The fees assessed under this section shall be deducted from the closed-loop payment processing system and shall be used to maintain the payment processing system and to reimburse the state highway patrol for its duties set forth in section _________________ of the Revised Code.

Section 3: Video Surveillance

  • Each cultivator, processor, retail dispensary, or laboratory licensed shall establish and maintain a closed circuit video surveillance system to record all business activities, including activities related to the delivery or sale of medical marijuana from one entity licensed under the Revised Code to another.
  • Before the delivery or sale of medical marijuana to an entity licensed under the Revised Code, each cultivator, processor, retail dispensary, or laboratory licensed under the Revised Code shall place the medical marijuana in a sealed container and shall record that act on its closed circuit video surveillance system.
  • On receipt of medical marijuana, each cultivator, processor, retail dispensary, or laboratory licensed under the Revised Code shall break the container’s seal and shall record that act on its closed circuit video surveillance system.
  • The state highway patrol shall be responsible for monitoring the closed circuit video surveillance system of each entity licensed under the Revised Code.
  • The fees assessed under this section shall be deducted from the closed-loop payment processing system as provided in section _______________ of the Revised Code and shall be used to maintain the payment processing system and to reimburse the state highway patrol for its duties set forth in section __________ of the Revised Code.