The newly-formed Ohio Division of Cannabis Control (DCC) began drafting regulations for administrative review in February, making headway to prepare citizens for access to adult-use cannabis in dispensaries beginning in September. Several rules, including elimination of the MMJ card state fee, already became law. Other proposed rules may be heard in front of the Joint Committee on Agency Rule Review (JCARR) and there still looms the chance of legislative meddling. Here’s the latest:
September: First Access to Adult Use Dispensaries
A point that could easily be misunderstood in this process is that licensure applications will be opened to MMJ dispensary owners in early June.
This first round of applications will be reserved only for existing Ohio MMJ licensees seeking dual licensure. Those applications will be reviewed and the first dual licenses are due to be issued to applicants on September 7th. Presumably, that would mean that a current MMJ dispensary ready to serve adult-use customers would be able to do so beginning on September 8th, 2024.
Your local medical marijuana dispensary’s opening date may vary widely from that. Some municipalities may also issue moratoriums delaying or banning existing MMJ dispensary licensees from selling to the consumer-public.Those dispensaries would continue to operate as medical card-only facilities.
According to the current law, 23 Level I medical cultivators could apply for up to three adult-use dispensary licenses, and 14 Level II cultivators could apply for one adult-use dispensary license each, according to DCC. Many of these cultivators are already vertically-integrated (hold cultivation, processor and dispensary licenses).
Only 120 medical cannabis dispensaries and 12 provisional dispensary licenses. Issue 2 calls for an additional 40 cultivators licenses and 50 dispensary licenses to be handed out as part of the Cannabis Social Equity and Jobs Program.
Canepa Cites Safety Concerns
The DCC’s director James Canepa last week told a Columbus news outlet that the Division is eager to grant citizens access to dispensaries, especially those who may be buying unregulated products currently. “If there are customers who have the choice between getting products that are not tested for pesticides and heavy metals and molds and bacteria, E. coli, and a product that is legal and tested and safe and sold by somebody with a permit who is required to follow the law versus some underground exchange in an alley, I think the choice is pretty clear,” Canepa told WBNS.
Will More Legislative Changes Occur?
In a last-minute session in December only hours before it became law, Sub.HB86, a bill to alter Issue 2 passed in the Ohio Senate 28-2. But the House has not taken up that proposal or its own version (HB354), and no further action has been taken despite Gov. DeWine’s urging. “We have had a lot of discussions in the House,” House Speaker Jason Stephens (R-Kitts Hill) said in February. “Our priority right now is having those thorough discussions. As you know, there’s a long runway for this issue, so we still have some time to do that.” Lawmakers return this week to the Statehouse starting Tuesday, with floor sessions scheduled in both chambers for the following Wednesday.
Issue 2 also placed a 10 percent tax on all adult-use consumer dispensary sales. (MMJ patients would not pay that.) If Sub.HB86 were to be taken up again and passed, the adult-use tax rate would go up to 15 percent. The bill would also allow for local governments and local counties to levy an additional tax on top of that, up to 3 percent.
What Other Changes Might Ohioans See?
As the administrative rule-making process continues for the Ohio DCC, additional considerations surrounding the cannabis laws are certain to be addressed. For instance, MMJ cardholders continue to advocate for more rights. And of particular interest to potential investors will be dates and fees associated with opportunities to apply for new licenses and how social equity applications will be judged.
Canepa also said during last week’s interview that Ohio will not allow dispensaries to advertise on billboards, something he said Michigan did and felt that was a mistake. Advertising restrictions have long been a compliance headache for the Ohio MMJ program, and Canepa’s comments indicate the adult-use program may have similarly-restrictive rules to follow. Time will tell whether those types of rules will be implemented or enforced.
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