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Department of Licensing and Regulatory Affairs Extends Deadline for Issuing Medical Marihuana Facility Licenses to Existing Facilities

Cannabis Law Blog

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Department of Licensing and Regulatory Affairs Extends Deadline for Issuing Medical Marihuana Facility Licenses to Existing Facilities

Today, the Department of Licensing and Regulatory Affairs (“LARA”) released an amended set of emergency administrative rules that implement the Medical Marihuana Facilities Licensing Act (“MMFLA”) and establish a transition period for existing medical marihuana facilities to become licensed. The most notable change to the rules benefits temporary operators who faced a fast-approaching June 15, 2018 deadline under the old rules to either be licensed or shut down.

Last year, on December 4, 2017, LARA promulgated its first set of emergency rules to govern the process of licensing medical marihuana facilities. These rules permitted existing medical marihuana facilities, called “temporary operators,” to submit a license application to the Bureau of Medical Marihuana Regulation (“BMMR”) between December 15, 2017, and February 15, 2018. The rules also provided a deadline for the State to issue licenses to temporary operators: June 15, 2018. Between February 15 and June 15, facilities were allowed to maintain operations on a temporary basis without jeopardizing their ability to become licensed. Under the first set of rules, if a temporary operator continued to operate after June 15 without a license, it would be engaging in unlicensed activity that could—and likely would—adversely impact its license application.

In recent months, however, it has become apparent that the State would not meet its June 15 deadline for issuing licenses. As LARA acknowledged in the rules it filed today, “[t]o date, no state operating licenses have been issued.” The application review process at the state level has been grueling for applicants and government analysts alike—both the overwhelming number of applications and depth of background detail required for each applicant have slowed the review process to an unexpectedly protracted pace. Additionally, the vast majority of temporary operators waited until February 15 to file their applications. Due to these delays, temporary operators and the patients they serve universally worried that, because no licenses have been issued, existing facilities would have to close their doors on June 15 to avoid risking license denial.

Today, though, LARA supplied an administrative fix by issuing its amended set of emergency rules. The new rules extend the deadline for the State to issue licenses to temporary operators from June 15 to September 15, 2018. This amendment gives some breathing room to those facilities that have been operating under the temporary rules. This new September 15 deadline will allow facilities to remain open on a temporary basis, which gives the State additional time to review and process license applications.

In addition to the critical deadline extension, the amended rules clarify some previously ambiguous provisions, set permissible limits for heavy metals in finished products, and establish a uniform sample size for safety compliance facilities—medical marihuana testing labs—to collect a sufficient amount of marihuana to complete all analyses required. The established sample size is not “less than 0.5% of the weight of the batch,” with a 9.1 gram minimum and a maximum batch size of 10 pounds. This provision is critically important to providing certainty both for the testing labs and the rest of the industry.

The new emergency rules are valid until November 30, 2018, after which permanent rules must be in effect. For further updates regarding state licensing, stay tuned to Dykema’s cannabis law blog.