With a revised application process over the 2012 “Act for the Humanitarian Medical Use of Marijuana”, the Massachusetts law is now among the most straightforward in the country for use of medical Cannabis. The Department of Public Health, the governing agency overseeing the Massachusetts medical marijuana program, took the best of existing state regulations and has continued to improve them ever since. And while navigating these regulations is a titanic undertaking for any startup, enough applicants have been through the process that experienced assistance in this process is available. This article provides a brief overview of the 5 phase application process, based on the experience of a Massachusetts medical marijuana attorney.
Massachusetts RMD Application Phase One – Application of Intent
The initial phase of the RMD application requires the creation of a non-profit entity. For this the applicant will need to show the corporate by-laws, a list of all officers, and evidence of its state registration. In addition, “character and competency” forms will need to be submitted for each officer and director of the corporation, forms that ask for general education and character qualifications from each individual, including the owner of any investors. A major requirement too is that the applicant must demonstrate where its funds are held and by whom, a minimum of $500,000 per application must be shown in a current bank account statement.
In practice, part of the $500,000 can be used to pay the $1500.00 fee for the Application of Intent, and the applicant may wait up to 8 weeks for an invitation to the next phase of the process, but the DPH can usually turn it around in half the time. If an additional site is applied for by the same applicant at any time in the process, the DPH requires a showing of an additional $400,000 in available funds. It should be noted that these capital requirements are far below what would ordinarily be required for starting a full scale Massachusetts medical marijuana operation, and should not in any way be considered a sufficient investment for this kind of business. The DPH is simply trying to establish a minimal threshold for serious applicants.
Massachusetts RMD Application Phase Two – Management and Operations Profile
The MOP is similarly another basic threshold for the DPH to filter out casual applicants from those who will go the distance. Instead of capital requirements, however, in this instance the State is looking to make sure the group and its members have done their homework. Details on how the company intends to manage the intense security requirements, and how it will conduct its growing operations are among the most important aspects that the applicant should be able to describe. A RMD should include individuals with these types of backgrounds, to help not only with the MOP, but build-out and operations. The MOP document itself must be submitted within 45 days of the applicant’s invitation, so we recommend having it completed prior to submitting the AI.
Along with the MOP, the applicant must submit background check authorization forms for all of the individuals listed in the AI, along with fees for each, and another $30,000 for the Phase 2 application itself.
Massachusetts RMD Application Phase Three – Siting Profile
The siting profile is usually by far the most labor-intensive, and time consuming aspect for most applicants. RMDs still have a lot of work in future phases, but it is at phase 3 of the application that the applicant must explore the communities that it can work with. The group needs to compile a list of desired or potential locations based on location, population and other factors it may deem important, and then run through a checklist of items to complete for investigating options in each municipality. Some of the highlights include:
- Complete zoning analysis on municipality.
- Find lease/purchase option for cultivation & processing.
- Find lease/purchase option for dispensary.
- Initiate process with town for obtaining letter of support or non-opposition.
This “letter of support or non-opposition” is the primary goal in phase 3 of the application. Many municipalities will require this letter be issued after reaching a “host agreement” from the applicant that details ways in which the RMD will contribute to the community. Understanding how host agreements work, the revenue a RMD can expect, and the funds available for such a contribution are key aspects that may determine the success or failure of a medical marijuana operation. And an applicant will not be able to open its doors without a letter of non-opposition, so this is a particularly sensitive time for any RMD.
Massachusetts RMD Application Phase Four – Provisional Certificate of Registration
If the applicant has submitted another $50,000 with completed phase 3 materials, and the DPH has deemed the RMD’s site to be compliant, the applicant moves on to the PCR. This stage is not simple by any means, but varies highly with the facilities the applicant intends to use. In this stage the RMD will begin its build-out, with an architectural review from the DPH and ongoing inspections as build-out of the facility proceeds. While earlier applicants ran into severe setbacks with HVAC and other climate control systems, much of those details have been ironed out as vendors in Massachusetts become more acquainted with requirements for marijuana cultivation.
Massachusetts RMD Application Phase Five – Final Certificate of Registration
After buildout is completed, the DPH has inspected all of the facilities for compliance with its regulations, and the operation has established itself equipped to cultivate, process and dispense marijuana, the company can begin its business. The RMD will commence its cultivation and processing operations, and submit its initial samples to the DPH for testing THC & cannabinoid levels, as well as for impurities like molds and heavy metals.
Final Considerations – Hire an Attorney! (You’re reading a law firm website)
This article encompasses much of what the Massachusetts medical marijuana application process will entail for each applicant, but each phase requires a very detail oriented set of tasks within it. While the process is indeed straightforward, it is highly abnormal that any person or group could complete each phase without any setbacks. And while any operation built correctly should be able to survive long into the future, eliminating as many setbacks as possible will naturally allow for that business to become profitable much sooner, which eliminates the uncertainty that continues to exist in this explosive industry. Contact Tim McNamara today, a skilled marijuana business attorney, to learn about how we can assist your organization in each phase of the application. In an industry full of untested vendors, our experience pays for itself on day 1, and can plausibly save a new organization hundreds of thousands of dollars in unnecessary expenses over the course of the entire application.
