Ohio Officials Release First Proposed Marijuana Licensing Rules Amid Push For Expedited Adult-Use Sales

Ohio regulators have released an initial batch of proposed rules for the state’s adult-use marijuana program, focusing on requirements for applicants seeking to become licensed retailers, as well as certain changes to the medical cannabis system.

Nearly three months after Ohio voters approved a marijuana legalization initiative at the ballot, the state Division of Cannabis Control (DCC) announced on Monday that it is requesting stakeholder feedback on the rules that must be finalized before the adult-use market launches.

However, the licensing application regulations that DCC is proposing may need to be amended in the coming weeks, as the Republican governor and GOP legislative leaders have pushed for a series of changes to the measure voters passed, including a possible expedited timeline to let existing medical cannabis dispensaries start serving adults within months, rather than waiting until September for the first potential licensing approvals.

For now, though, the proposed rules would require regulators to open applications for medical cannabis operators seeking a dual license by June 7. They would need to start approving provisional licenses to eligible entities by September 7.

The proposals also describes how DCC, which falls under the Department of Commerce, would need to post notice of an exclusive application window for prospective licensees who participate in a social equity and jobs program that’s being developed.

Regulators also formally proposed eliminating medical cannabis patient and caregiver registration fees, while reducing the medical marijuana processor license renewal fee from $100,000 to $50,000. The reforms were included in the voter-passed legalization initiative, which also stipulates that patients will not be subject to the recreational excise tax on marijuana products.

Stakeholders interested in commenting on the rules are welcomed to submit feedback by February 9. This is the first in what’s expected to be multiple rules packages for the adult-use program.

“The Division will review and consider the comments received prior to submitting the proposed rules to the Common Sense Initiative and the Joint Committee on Agency Rule Review in accordance with Chapter 119 of the Ohio Revised Code,” DCC said. “Both of those processes will provide stakeholders further opportunity to comment on the proposed rules.”

The timeline for legal sales is likely one of the areas that will get the most attention, as  Gov. Mike DeWine (R) has been clear that he wants the legislature to speed up that part of the law. He’s criticized the “goofy situation” Ohio is in, where adults 21 and older are able to legally possess and grow marijuana, but there won’t be regulated access until late this year.

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The Senate passed a bill last month that would address the issue by allowing existing medical cannabis dispensaries to dually serve patients and adult consumers within 90 days of enactment, in addition to other changes to the initiated statute. But the House hasn’t taken it up, and the chamber is also considering an alternative package.

DeWine also recently signaled that he’d like to see an even quicker turnaround, with legislation that would allow for recreational sales within two months. And he’s separately stressed that he wants to see lawmakers to tackle restrictions for sales of intoxicating hemp-derived cannabinoid products such as delta-8 THC.

The governor, who campaigned against the legalization ballot measure, previously voiced support for the idea of moving marijuana tax dollars to law enforcement—a policy change opposed by advocates who want to maintain funding for social equity initiatives as prescribed under the ballot initiative voters approved.

With respect to the broader legalization implementation debate, some Democratic lawmakers have indicated that they may be amenable to certain revisions, such as putting certain cannabis tax revenue toward K–12 education. But other supporters of the voter-passed legalization initiative are firmly against letting legislators undermine the will of the majority that approved it.

Ohio Rep. Juanita Brent (D) has emphasized that people who’ve been criminalized over marijuana, as well as those with industry experience, should be involved in any efforts to amend the state’s voter-approved legalization law, arguing that it shouldn’t be left up to “anti-cannabis” legislators alone to revise the statute.

Rep. Gary Click (R) filed legislation in late November that would allow individual municipalities to locally ban the use and home cultivation of cannabis in their jurisdictions and also revise how state marijuana tax revenue would be distributed by, for example, reducing funds allocated to social equity and jobs programs and instead steering them toward law enforcement training.

Meanwhile, following voter approval of legalization, the Department of Commerce was quick to publish an FAQ guide for residents to learn about the new law and timeline for implementation.

The commerce department also announced last month that the state’s top alcohol regulator, who previously worked as a prosecutor, would be heading up the new Ohio marijuana regulatory division.

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Photo courtesy of Brian Shamblen.

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