As of September 2010, even if the proposition is passed, the sale of marijuana will remain illegal under federal law via the Controlled Substances Act.
According to the State of California analysis, the bill will have the following effects.
Legalization of personal marijuana-related activities
Persons age 21 and older:
May possess up to 1 ounce (28 g) of marijuana for personal consumption.
May use marijuana in a non-public place such as a residence or a public establishment licensed for on site marijuana consumption.
May grow marijuana at a private residence in a space of up to 25 square feet (2.3 m2) for personal use.
Local government regulation of commercial production and sale
Local government may authorize the retail sale of up to 1 ounce of marijuana per transaction, and regulate the hours and location of the business.
Local government may authorize larger amounts of marijuana for personal possession and cultivation, or for commercial cultivation, transportation, and sale.
Allows for the transportation of marijuana from a licensed premises in one city or county to a licensed premises in another city or county, without regard to local laws of intermediate localities to the contrary.
Imposition and collection of taxes and fees
Allows the collection of taxes specifically to allow local governments to raise revenue or to offset any costs associated with marijuana regulation.
Authorization of criminal and civil penalties
Maintains existing laws against selling drugs to a minor and driving under the influence.
Maintains an employer's right to address consumption of marijuana that affects an employee's job performance.
Maintain existing laws against interstate or international transportation of marijuana.
Every person 18 years of age or older who hires, employs, or uses a minor in transporting, carrying, selling, giving away marijuana, or knowingly sells or gives away marijuana to someone under the age of 14, shall be imprisoned in state prison for a period of three, five, or seven years.
Every person 18 years of age or older who knowingly sells or gives away marijuana to someone older than the age of 14 but younger than 18, shall be imprisoned in the state prison for a period of three, four, or five years.
Every person 21 years of age or over who knowingly sells or gives away marijuana to someone older than the age of 18 but younger than 21, shall be imprisoned in county jail for up to six months and fined up to $1,000 per offense.
Any person who is licensed, permitted, or authorized to sell marijuana, who knowingly sells or gives away marijuana to someone under the age of 21 results in them being banned from owning, operating, or being employed by a licensed marijuana establishment for one year.
In the time leading to 2010, California's state government's budget deficit has grown to be the largest of all American states. The State Board of Equalization has estimated that imposing a $50 per ounce levy on marijuana sales could generate $1.4 billion a year in new tax revenue, thus generating a large amount of revenue at a time when the state is experiencing financial pressure.
According to the States Legislative Analyst's office the following fiscal impact would result from the bill:
Result in significant savings to state and local governments, potentially up to several tens of millions of dollars annually due to reduction of individuals incarcerated, on probation or on parole.
Cells currently being used to house marijuana offenders could be used for other criminals, many of whom are now being released early because of a lack of jail space.
Major reduction in state and local costs for enforcement of marijuana-related offenses and the handling of related criminal cases in the court system, providing the opportunity for funds to be used to enforce other existing criminal laws.
Potential increase in the costs of substance abuse programs due to speculated increase in usage of marijuana, possibly having the effect of reducing spending on mandatory treatment for some criminal offenders, or result in the redirection of these funds for other offenders.
The measure could potentially reduce both the costs and offsetting revenues of the state's medical marijuana program as some adults over 21 would be less likely to participate in the existing program as obtaining marijuana would be easier for those patients.
The measure would provide the opportunity for significant additional revenues as the result of the taxation of sales and businesses engaged in commerce relating to marijuana.
There would be a reduction in fines collected under current state law but a possible increase in local civil fines authorized by existing local laws.
The cumulative effect on fines is largely unknown.