Member Blog: How to Prepare a Winning Dispensary License Application
by Gary Cohen, Cova Software
The cannabis industry has come a long way in the U.S. Although we still await federal legalization, many new states have recently jumped on the bandwagon, and legacy states are awarding more social equity licenses. While New Jersey and Mississippi will be opening their first dispensaries by the end of 2022, New York has started accepting applications for CAURD licenses from justice-involved individuals. But scoring high points on your dispensary license application can be challenging, especially with all the stringent requirements. Here are some quick tips to help you stand out and prepare a winning dispensary license application.
Follow your State Cannabis Authority’s Guidelines
Every state in the US has different guidelines and regulations for a cannabis dispensary license. Do a thorough review of all the information available on your state cannabis authority’s website, and keep a look out for when they will start accepting applications. Most states accept only electronic applications, and you will likely have to create an account online on a designated website and link your company’s official information. For an application to be deemed complete, a response to each criterion specified must be included, along with the required documents.
Ensure You Qualify and Apply for the Right Category
To be eligible to submit a cannabis dispensary license application, you must reside in the state where you are applying or must be registered to do business in that state. Many states are awarding conditional cannabis business licenses to social equity applicants first or prioritizing applicants impacted by the war on drugs to build an equitable cannabis industry. If you qualify for any of these categories, ensure that you apply for the right one to expedite the processing of your dispensary license application.
Connect with the Community Where you Plan to Operate
Some states require your dispensary to be located in the municipality you live in, and you will be awarded a license only for a particular zone. Community reach and impact are also criteria laid down by some cannabis authorities, and you must establish connections with not just local and state officials but also other people who can help you understand the bigger picture better. For example, New Jersey and New York want you to explain the positive community impact your dispensary business will have. If you don’t connect with the community, you won’t be able to align your vision with their needs in your dispensary license application.
Fortify Application with a Business Operations & Security Plan
After familiarizing yourself with the license requirements and structure, you must dive into how you can prepare the best possible application to score higher points on every measure. For example, to obtain a conditional dispensary license in New Jersey, 40 out of 100 points are for your dispensary business plan, and another 50 points are for a regulatory compliance plan. One of the most crucial aspects of this is a dispensary operations plan that you must include in your application. This plan helps authorities understand how your dispensary business will comply with all cannabis laws and regulations and ensure safe access to cannabis for your customers.
Compliance is the Name of the Game
The detailed plans included in your cannabis dispensary license application must also mention the technology provider you intend to partner with, and choosing a compliant cannabis retail platform will help you fortify your application further. Prepare a winning dispensary license application by downloading Cova Software’s free template, Dispensary Operations and Security Plan, which will serve as a comprehensive guide to writing a winning plan for a successful cannabis retailer license application.
Gary Cohen is the CEO of Cova Software, the fastest growing technology brand in the cannabis industry. Cohen’s focus has been driving the company’s overall strategy, including its vision, go-to-market plan, and strategic development. Since joining the cannabis industry in 2016 and launching Cova commercially in 4q17, Cohen has led Cova to dominate the enterprise sector for dispensary Point of Sale, while forging client relationships with hundreds of single-store retailers across North America.
With Cova’s cannabis POS and its excellent integrations with eCommerce and delivery services, the online order automatically pops up for the budtender to tender the sales, and the POS system updates inventory once payment is approved. Cova offers multiple eCommerce solutions to choose from, as per your needs and budget, and you can legally sell cannabis online stress-free while staying compliant with strict government regulations.
Committee Blog: Mississippi to Implement Medical Cannabis Law
By Joe Smith, Thompson Hine LLP
member of NCIA’s State Regulations Committee, New States Subcommittee
On February 2, 2022, Mississippi Governor Tate Reeves signed the Mississippi Medical Cannabis Act (SB 2095) into law, making Mississippi the 37th state to authorize the medical use of cannabis. Passage came after the voter-approved ballot measure allowing a medical cannabis program was struck down by the Mississippi State Court. The Mississippi Department of Revenue (MDOR) has 150 days from enactment to begin the process of licensing dispensaries and is working with the Mississippi Department of Health (MDOH) to design the application process. The Alcoholic Beverage Control Enforcement Division of MDOR will be the division accepting the license application and will begin accepting applications no later than July 1, 2022. Thirty days after receiving a completed application, it will have to issue dispensary licenses to qualifying applicants.
Patient Qualification and Limitations
To qualify for the program, patients must have at least one qualifying medical condition and a certification issued by a healthcare practitioner with whom they have a bona fide relationship. A “bona fide practitioner-patient relationship” means the practitioner has a treatment relationship with the patient during which the practitioner has completed an in-person assessment of the patient’s medical history and current mental health and medical condition; has consulted in person with the patient about the patient’s debilitating medical condition; and the practitioner is available to or offers follow-up care and treatment to the patient. The practitioner must be a Mississippi-licensed physician, nurse practitioner, physician assistant, or optometrist. They must believe the patient “would likely have medical or palliative benefit” from medical cannabis to treat their qualifying condition. They also must have completed 8 hours of continuing medical education on medical cannabis and complete five hours every year thereafter.
The qualifying conditions are cancer, Parkinson’s, Huntington’s, muscular dystrophy, glaucoma, spastic quadriplegia, HIV, AIDS, hepatitis, amyotrophic lateral sclerosis (ALS), Crohn’s, ulcerative colitis, sickle cell anemia, Alzheimer’s, agitation of dementia, PTSD, autism, pain refractory to opioid management, diabetic/peripheral neuropathy, spinal cord disease, or severe injury. Patients can also qualify with a chronic medical condition (or its treatment) that produces either cachexia or wasting, severe nausea, seizures, severe and persistent muscle spasms, or chronic pain, narrowly defined as “a pain state in which the cause of the pain cannot be removed or otherwise treated, and which in the generally accepted course of medical practice, no relief or cure of the cause of the pain is possible, or none has been found after reasonable efforts by a practitioner.” There also will be a petition process for patients to seek coverage for other unspecified conditions.
The program limits possession and purchases to “Medical Cannabis Equivalency Units” (MCEUs) of 3.5 grams of flower, up to 100 mg of THC in infused products, or 1 gram of concentrate. Patients’ purchases are limited to 6 MCEUs in a week and 24 MCEUs in a month. They may not possess more than 28 MCEUs at one time. Flower is limited to 30% THC, with tinctures, oils, and concentrates not allowed to exceed 60% THC.
Regulation and Business Operations
The MDOH will be the primary regulator and coordinate with the MDOR for licensing and operations. MDOH will create the applicable regulations relating to seed-to-sale tracking, recordkeeping requirements, safe processing stands, transportation, health and safety, and security. It also will be responsible for monitoring and restricting advertising, signage, and displays. All products will contain a “notice of harm” regarding the use of medical cannabis products.
Licensing will be required for dispensaries, cultivation facilities, processing facilities, transportation entities, disposal entities, testing facilities, and research facilities. Cultivators will be tiered based on size, and the law does not include a numerical cap on business licenses. No individual or business may have more than 10% ownership interest in more than one cultivation license, one processing license, and up to four dispensaries. Application fees for cultivators will range from $1,500 to $60,000 depending on the size/tier of the particular cultivator, with annual fees similarly ranging from $2,000 to $100,000. Cannabis will be taxed at wholesale at 5% of the price, in addition to standard sales taxes.
Initially, dispensaries will not be able to provide delivery or curbside pickup for patients. Still, the law does provide that MDOH and MDOR are to implement rules that include “Protocol development for the safe delivery of medical cannabis from dispensaries to cardholders.” Dispensary staff will be required to complete an initial 8 hours of education on medical cannabis and 5 additional hours of continuing education every year. They also must be over 21 and obtain a work permit for $25. They also generally have been previously convicted of a violation crime or been convicted of a felony violation of a state or federal controlled substance law within five years. A disqualifying felony offense does not include a conviction for conduct that would not have been a felony but for the conduct occurring before the effective date of the Mississippi Medical Cannabis Act.
Medical cannabis businesses are not allowed to be located within 1,000 feet of the boundary of a school, church, or childcare facility, and dispensaries must be at least 1,500 feet from another dispensary. While localities can regulate the time, place, and manner of medical cannabis businesses, they can not ban them or “make their operation impracticable” unless they opt-out of the medical marijuana program by a vote of the localities governing body within 90 days of the law’s passage. If a locality opts out, 20% or 1,500 voters (whichever is fewer) can petition to put the question on the ballot, and an election must be held within 60 days.
Hurry Up And Wait: Descheduling, DEA Licenses, And Other Reform Legislation to Watch
By Morgan Fox, NCIA’s Director of Media Relations
The cannabis world is still eagerly awaiting the introduction of Senate Majority Leader Chuck Schumer’s comprehensive descheduling legislation, but that doesn’t mean things haven’t been moving on the policy front in recent weeks!
First up, the DEA announced that it was finally moving forward with approving applications to cultivate cannabis for research purposes, which would effectively end the federal government’s stranglehold on research production. The agency spent years fending off lawsuits from applicants, who correctly asserted that not only was the monopoly limiting research, but the cannabis being grown at the single licensed facility at the University of Mississippi was basically unusable for research purposes anyway. This announcement comes several years after the DEA publicly stated that it would begin the licensing process. Better late than never.
Of course, we don’t think the DEA should be involved in cannabis research whatsoever, seeing as how they are a law enforcement organization and not, you know, scientists.
Next, Sen. Ron Wyden, who is also working closely with Majority Leader Schumer on descheduling along with Sen. Cory Booker, introduced S. 1698 last week. While text of this bill is currently not publicly available, the name suggests that this legislation would direct the FDA to allow hemp-derived CBD, made legal under the 2018 Farm Bill, to be used as a dietary supplement or in food. Some perceive this bill as necessary to get some regulatory clarity from the FDA, which has been dragging its feet and missed several deadlines for CBD regulations. Many in the industry blame this lack of regulation for larger retailers staying out of the CBD market, which has led to massive supply gluts of the substance and has been hypothesized to be a leading cause for the recent boom in Delta 8 THC production.
And earlier this month, Rep. David Joyce, an Ohio Republican who co-chairs the Congressional Cannabis Caucus, introduced a narrowly tailored bill to remove cannabis from the schedule of controlled substances. The bill assigns regulatory responsibilities to the FDA and the Alcohol and Tobacco Tax and Trade Bureau and gives them a one-year deadline to come up with a regulatory structure similar to alcohol. It also contains provisions similar to the protections that exist in the House-approved SAFE Banking Act, calls for studies on how cannabis impacts pain and driving, and improves access for veterans. Notably, this bill does not contain any social equity or restorative justice language.
While the chances of such legislation passing in the Democrat-controlled House are slim, it could serve as a doorway to get fence-sitting Republicans into the debate. It could also be a tool to identify those members of the GOP who are steadfastly opposed to any legalization bill and out of touch with their constituents, many of whom would directly benefit from cannabis policy reforms and who are increasingly in support of ending federal prohibition.
We’re also getting word that the Marijuana Opportunity, Reinvestment, and Expungement (MORE) Act is getting reintroduced in the House this week (and may have already been at the time of this publication). This legislation made history last December when it became the first descheduling bill to receive a floor vote – and pass – in either chamber of Congress. We are hopeful that there will be some revisions from the previous bill, including the removal of a provision that would allow federal licensors to deny applications for cannabis business licenses based on prior state or federal felony convictions, and the inclusion of a more sensible and robust regulatory framework.
We are less than halfway through the calendar year, and it is shaping up to be a momentous one for cannabis advocacy! Stay tuned for more updates from Capitol Hill.
P.S. On the state side, Alabama became the latest state to approve an effective medical cannabis law. Yes, Alabama. That brings the count of medical states to 36, after unfortunately losing Mississippi to a shameful court decision. So far in 2021, four states have approved adult-use or medical cannabis legislation, and more are expected to do so in the coming weeks and months.
Election Night 2020: Victories For Sensible Cannabis Policies
by Morgan Fox, NCIA’s Director of Media Relations
While the country waits for the outcomes of national elections that could very well impact the future of cannabis policy reform advocacy, we do have a LOT to be happy about today!
Last night, adult-use and medical ballot initiatives SWEPT the elections, passing in every state in which they were considered!
Voters in Arizona, Montana, New Jersey, and South Dakota all passed measures making cannabis legal and regulated for adults. South Dakota also approved a medical cannabis initiative by an even greater margin, and was joined by Mississippi where an overwhelming majority of voters not only supported medical cannabis but chose the much more comprehensive of two competing options.
You can learn more about these initiatives here and how they fared in the elections here.
There are a lot of important milestones and lessons to observe from these historic results.
First, let’s talk about New Jersey. Roughly two thirds of voters in the state approved this ballot measure, which was referred to them after lawmakers were unable to pass similar legislation last year. This is a big jump in ballot approval margins; before now, the most popular legalization referendum was in California, which approved Proposition 64 in 2016 with 57% of the vote. That’s a 10% margin increase in just four short years! The large population and huge market potential (more than $1.5B by 2025) are sure to have a major impact on the industry. Regionally, passage of this initiative is certain to add urgency to adult-use cannabis regulation efforts in states like New York, Pennsylvania, Connecticut, Delaware, and Rhode Island.
South Dakota also set a record by becoming the first state to approve an adult use law before having an established medical cannabis system, and in a very conservative state no less! Voters supported both medical and cannabis initiatives despite strong opposition from the governor and other officials.
In Arizona, after voters narrowly defeated a legalization initiative in 2016, a significant swing brought a 10% increase in support resulting in passage. This long-overdue change is especially important because Arizona is the only state where simple possession is a felony and nearly 15,000 people are arrested every year.
So what does this mean for future reform efforts?
First and foremost, the passage of the adult use initiatives means nearly 34% of Americans now live in states with laws making cannabis legal and regulated for adults. These four states account for roughly 60,000 marijuana arrests every year, mostly for simple possession. Congressional representation of states where cannabis is legal for adults will increase by 29 representatives and eight senators. This doesn’t guarantee their support for cannabis legislation, but it certainly increases the chances.
Second, passage of cannabis policy reform initiatives in conservative states like Mississippi, Montana, and South Dakota should send a signal to Republican lawmakers in Congress that this is an issue that they can support, and one which they will face political consequences for impeding. The fact that all three of these states had multiple cannabis-related issues on the ballot and voters were not swayed or confused is a testament to the will for change in these areas and a growing understanding of the issue.
Long story short: more and more states will continue to enact sensible, modern cannabis policies in the coming years, and every state that does so will help add to the chorus of voices from the public and in Congress calling for an end to outdated federal prohibition policies.
Cannabis State Ballot Measures – Facts & Figures
by Morgan Fox, NCIA’s Director of Media Relations
Arizona
Ballot: Proposition 207, Smart & Safe Act (adult use)
Summary: https://smartandsafeaz.com/about/
Full language: https://mk0adassociatioy1jbg.kinstacdn.com/wp-content/uploads/2019/10/I-23-2020.pdf
Main backers: Smart and Safe Arizona
Possession: Adults 21+, 1 ounce flower or 5 grams concentrate
Home cultivation: YES, adults 121+ may have up to 6 plants in an enclosed locked location out of public view.
Licenses:
- Issue no more than one marijuana establishment license per 10 pharmacies;
- Issue no more than two marijuana establishment licenses in counties that contain no registered nonprofit medical marijuana dispensaries;
- Issue no more than one marijuana establishment license in counties with one nonprofit medical marijuana dispensaries; and
- Issue 26 licenses, notwithstanding the other limits, to entities qualified under the Social Equity Ownership Program.
Social Equity:
Department of Health Services would be required to establish a Social Equity Ownership Program to promote cannabis business ownership and employment for individuals from communities disproportionately impacted by the enforcement of previous marijuana laws.
Proposition 207 would establish a fund called the Justice Reinvestment Fund (JRF). Revenue in the JRF would be allocated as follows:
- 35 percent to local public health departments in proportion to the county’s population for the purpose of providing justice reinvestment programs or giving grants to nonprofits to provide justice reinvestment programs within the county’s area.
- 35 percent to DHS to provide grants to nonprofits to provide justice reinvestment programs in the state.
- 30 percent to DHS “for the purpose of addressing important public health issues” that affect Arizona.
Taxes & Revenue:
Transaction Privilege Tax (currently 5.6%)
Specific 16% excise tax (non-medical)
Revenue from the excise tax and license fees would be deposited into the Smart and Safe Arizona Fund. First, revenue would be used to implement and enforce marijuana regulations. The remaining revenue would be allocated as follows:
- 33.0 percent for community college districts;
- 31.4 percent for municipal police and fire departments, county sheriff departments, and fire districts;
- 25.4 percent for the state’s Highway User Revenue Fund;
- 10.0 percent for the new Justice Reinvestment Fund; and
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Additional Resources: Proposition 7 Information, FAQ
Mississippi
Ballots: Initiative 65 (medical), Alternative 65A (medical, terminally ill patients only)
Summary:
Full Language:
Main Backers:
Possession:
- Initiative 65 – Qualifying patients may purchase/possess up to two and a half (2.5) ounces every 14 days
- Alternative 65A – Undefined, no explicit protections
Home Cultivation: NO
Licensing:
- Initiative 65 – TBD by Dept. of Health; no limits on number of treatment centers; may not be located within five hundred (500) feet of a pre-existing school, church, or licensed child care center
- Alternative 65A – Undefined
Social Equity: None explicitly included in either initiative.
Taxes & Revenue:
- Initiative 65 – Dept. of Health may authorize taxes up to the level of the state sales tax (currently 7%); revenue to be used for special operating fund and may not revert to state general fund
- Amendment 65A – Undefined
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Additional Resources: Overview and Sample Ballot Question – IMPORTANT! These questions are worded in a confusing manner on ballots.
Montana
Ballots: Initiative 190 Marijuana Legalization Initiative (adult use), CI-118 Allow for a Legal Age for Marijuana Amendment
Summary:
- Initiative 118 would allow legislation or a citizen initiative to set the legal age limit for possession at an age higher than the state definition of adulthood (18 years old).
- Initiative 190 would regulate cannabis for adults age 21 and older.
- Summary of both initiatives is available here.
Full Language:
Main Backers: New Approach Montana
Possession: Adults 21+, up to one ounce of flower or 8 grams of concentrate
Home Cultivation: YES, up to four (4) plants per adult, maximum eight (8) per household.
Licensing:
The Department of Revenue shall develop rules and regulations regarding licensing of providers, marijuana-infused products providers, and dispensaries for adult use. For the first 12 months, only existing medical cannabis licensees may apply. Provider licenses are established in tiers based on canopy size and also include micro-business licenses. Applicants must have resided in Montana for at least one year prior and may not have been convicted of a felony involving fraud, deceit, or embezzlement or for distribution of drugs to a minor within the past 5 years. Cannabis businesses may not be located within 500 feet of a school or place of worship unless permitted by the local jurisdiction.
Social Equity: Persons convicted of behavior permitted by Initiative 190 may apply for resentencing or expungement.
Taxes & Revenue:
- Specific sales tax – 20%
- Revenue will be used to fund operating costs of regulation as well as to support conservation efforts, substance abuse treatment and education, veterans programs, local governments, the general fund, and other programs. More information is available here.
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Additional Resources: Initiative 190 Information
New Jersey
Ballots: Question 1, Marijuana Legalization Amendment (2020)
Summary: https://www.njcan2020.org/whats-on-the-ballot/
Main Backers: NJ Can 2020
Possession: 21+, limits TBD by Legislature
Home Cultivation: TBD by Legislature
Licensing: TBD by Legislature, regulated by existing Cannabis Regulatory Commission
Social Equity: TBD by Legislature
Taxes & Revenue: Standard state sales tax of 6.625%; Legislature can authorize municipalities to impose up to an additional 2% local tax
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Additional Resources:
South Dakota
Ballots: Measure 26 (medical), Amendment A (adult use)
Summaries: https://www.southdakotamarijuana.org/the-initiatives
Full Language:
Main backers:
Possession:
- Measure 26 – Registered patients, up to three (3) ounces
- Amendment A – Adults 21+, up to one ounce
Home Cultivation:
- Measure 26 – Patients with home cultivation certification may grow 3 plants minimum or a number determined by their physician
- Amendment A – 3 plants per person (6 max per household) in jurisdictions with no licensed retail stores
Licensing:
- Measure 26 – TBD by Dept. of Health
- Amendment A – TBD by Dept. of Revenue
Social Equity: None explicitly included in initiative language
Taxes & Revenue:
- Measure 26 – TBD by Dept. of Health and Legislature
- Amendment A – 15% sales tax, split evenly between public school fund and state general fund after implementation and operation costs are covered.
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Additional Resources:
2020 Marijuana Ballot Initiatives – Time to Make History!
by Madeline Grant, NCIA’s Government Relations Manager
With the election coming up just around the corner, 2020 could be another big year for our movement. It is imperative that we all head to the polls, send in our mail-in ballots and make our voices heard in this monumental election. This week I will briefly go over each ballot initiative that has officially qualified for the November ballot. As we continue to get closer to the election, I will get into detail about what each ballot initiative does for each state. 2020 has been a year of uncertainty and as we approach the election it is our duty as U.S. citizens to get out and vote and as members of the cannabis industry, it’s important that we support the expansion of markets by donating to initiative campaigns.
Without further ado please see marijuana ballot initiatives below:
- Arizona – Adult-Use: Smart and Safe Act (Prop 207)
- Mississippi – Medical: Initiative 65
- New Jersey – Adult-Use: The New Jersey Marijuana Legalization Amendment
- Montana – Adult-Use: I-190 would legalize, regulate, and tax marijuana in Montana.
- More information provided by the Marijuana Policy Project here.
- Montana – CI-118 would allow the minimum legal age for marijuana to be set at 21.
- More information provided by the Marijuana Policy Project here.
- South Dakota – Medical- Initiated Measure 26
- More information provided by the Marijuana Policy Project here.
- South Dakota – Adult-use (and protects medical law) Constitutional Amendment A
- More information provided by the Marijuana Policy Project here.
- Nebraska – Medical marijuana ballot initiative is no longer happening due to the Nebraska Supreme Court deeming the legalization of medical marijuana on the November ballot as unconstitutional. Following over 180,000 signatures by Nebraskans in support of the measure, the Supreme Court decided to not include the vote on November’s ballot on the day before the deadline. The justification of unconstitutionality came from Nebraska’s single-subject rule for a ballot measure, which bans multiple issues into yes-or-no questions for voters to address.
It is more important than ever to get out and vote. Our government relations team works hard in our nation’s Capital to achieve legislative victories at the federal level; however, achieving legislative victories at each state is just as important. It is through each successful ballot initiative at the state that provides the proof and support for legislative change and policy reform at the federal level. States are moving forward; therefore, we must be on Capitol Hill. We must keep fighting the good fight and get out and show our support for cannabis policy reform.
Are you interested in any of these states or want to learn more about one of these ballot initiatives? If so, please feel free to reach out to me to set up a meeting to discuss the information in more detail or contact the campaigns directly to find out how you can support them.
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