By Jeffrey L. Wax, AEGIS Law (jwax@aegislaw.com)

The Missouri Department of Health and Senior Services last week released draft regulations for medical marijuana facilities generally, as well as specific regulations for cultivation, marijuana-infused product manufacturing, and dispensary facilities specifically (19 CSR 30-95.040, .050, .060, and .080, respectively).  They can be downloaded at: https://health.mo.gov/safety/medical-marijuana/draft-rules.php (last checked March 27, 2019).

The draft regulations provide clarification to the planning process in terms of applications, identifying ownership and key personnel, and identifying a location.  Here are some highlights:

  • Applications for a facility license will be accepted beginning August 3, 2019, but the application window will close on a certain date. Future application periods will be opened after a six-month notice.
  • The Department plans to issue no more than the minimum number of licenses required by Article XVI of the Missouri Constitution: 60 for cultivation, 86 for manufacturing, and 192 for dispensaries (24 per present Congressional districts).
  • Applicants must fully identify and perform criminal background checks on all owners, principal officers, and managers for their applications.
  • The Applicant must be “majority owned by natural persons who have been” Missouri citizens for at least one (1) year prior to applying. Still unclear is whether those natural persons must directly own the Applicant entity or if they can hold their interests through another entity.  Also unclear is whether and/or how management control must be tied to the majority owners.
  • The issuance of a license does not mean that an Applicant can commence operations. A commencement inspection must occur within one (1) year after the license is issued before operations can commence.  Therefore, do not expect medical marijuana to be available to the public until mid-2020 at the earliest.
  • Every owner, officer, manager, contractor, employee, or support staff person must obtain an Agent Identification Card before employment commences, which includes a criminal background check.
  • Facilities are required to be located more than 1,000 feet from schools, day cares, and churches (unless local governments choose to shorten this distance). The distance will be measured from the property line of the school, etc., to, (a) if a freestanding building, the property line of the Applicant’s facility, or (b) if located in a shopping center or office building, the closest door (front or rear).  Importantly, it will be measured by “the shortest path between demarcation points that can be travelled by foot,” i.e., the “Sidewalk Rule.”
  • Department permission is needed to transfer any license (including to a parent company or subsidiary); change ownership, organizational structure, or financing; redesign the facility’s layout; and combine multiple licenses at one facility. This highlights the importance of setting up your ownership structure correctly from the beginning.  Applicants should avoid the need to make changes.
  • Cultivation facilities are required to harvest their crop at least once every 120 days to ensure a consistent supply of medical marijuana.
  • Dispensary facilities are required to have an equal number of staff on hand to assist each person admitted to the dispensary. A patient can enter with a caregiver and up to two other persons, so that could mean four employees present for a single customer.  If only two staff are on hand, then the dispensary may have to exclude two of the four people.

The draft regulations provide many other details for operational plans, security plans, safety controls, environmental and waste controls, etc.  Interested applicants should review them thoroughly.

The Regs:

19CSR30-95.040 Facilities Generally
19CSR30-95.050 Cultivation Facility
19CSR30-95.060 Manufacturing Facility
19CSR30-95.080 Dispensary Facility

AEGIS Law is a leader in working with cannabis industry clients in Missouri and other states.  If you are interested in becoming part of the emerging medical marijuana industry in Missouri, contact AEGIS Law for help today.  Jeff can be reached at jwax@aegislaw.com.