First Cultivation, then Dispensary, then Testing Labs, and finally.. Processing.

Processing applications for Ohio’s medical marijuana program were released at 2:30pm today, 10/19/2017, and the race begins! Potential licensees have until no later than December 15th 2017 to submit a viable app.

Generally speaking, hopeful applicants seem to fall into one of 3 categories, and the best way to start with a leg up is to acknowledge which one best describes you so that you can approach the process with all of the necessary resources:

  1. Experienced cannabis industry teams who have completed the licensing process in another state(s) and will adapt their application process to a new state’s requirements
  2. First time applicants who bring a strong team from another parallel industry and need to align with a strong set of cannabis professionals to fill in the gaps and establish industry credibility
  3. Individuals/groups looking to enter the space who have plenty of capital, but have not gone through a similar licensing process in another industry and will likely benefit from a good deal of guidance to get to a point where they know what they don’t know about this very scrutinous process

While all groups mentioned above can benefit from this breakdown of the application process, my purpose is mainly to help those who fall into the 2nd and 3rd categories understand what’s ahead, and plan for the resources they may still need to acquire to maximize their chances of submitting a competitive app.

Below is a complete summary of all of the final rules, regulations and requirements to apply for a medical marijuana processor in Ohio.

Where to get the official docs?

Ohio has an excellent website up at: which includes instructions, applications, final rules and regulations.

What’s the most important section of the application?

In short –  the operations plan  – which pairs with the quality assurance plan.
Together they account for 60% of the entire application. Given that this section is so consequential, a plethora of specifics that aren’t explicitly mentioned need to be addressed very thoroughly.  For this section in particular, if you have not done it before, we don’t suggest going it alone.

When strategizing your application, don’t overlook the point conversion factor laid out on the last page of the instructions. Pay close attention to the percentage of total available points (TAP) each section is worth, not how many raw points each section is worth, rather focus a good deal of your time on the portions that are weighted most heavily.

I approach the application in this manner:

  1. Operations Plan – Section 2B – 35.4% TAP
  2. Quality Assurance Plan – Section 2C – 24.6% TAP
  3. Security Plan – Section 2D – 20% TAP
  4. Financial Plan – Section 2E – 12.7% TAP
  5. Business Plan – Section 2A – 7.3% TAP

We’re frequently asked, “Where should we focus most of our resources?” and in my experience, there’s no clearer way to focus time than by approaching section 2 based on the total available points each section is worth. While this may seem cut and dry, there are a ton of ins and outs that go into an excellent cannabis financial plan or a cannabis specific security plan that aren’t explicitly required in the app.

While I don’t mean to sound like a broken record making this type of remark, I would be doing people a disservice if I misrepresented the ability of this walk-through to replace a consultant.

There are dozens of other pieces of the application that may not count for points, but certainly factor into the application process. A couple of other critically important components include:

  • Community support w/ letters
  • Community action plan
  • Capital greatly exceeding minimum requirements
  • Supporting visuals

Exactly how to weave these components into the application is a delicate dance and varies by state since each prohibits different content.

Now onto some of the more technical details of what’s necessary to be considered a viable applicant in the Ohio Medical Marijuana Program.

Minimum Requirements to Apply:

  • $250,000+ liquid assets ready to fund the operation *only $100,000 if collocated with a cultivation license
  • $250,000 Surety Bond or Escrow Account
  • 21+ Years Old
  • Be of good moral character free from felony convictions
  • Must have real-estate selected with a lease agreement in place
  • No Ohio residency requirement
  • Majority women-owned and Minority-Owned applications will get additional “consideration” likely in the way of bonus points though it’s unclear exactly how preference will be given

Application fees:

  • Non-refundable application fee – $10,000
  • Processor Permit fee – $90,000 (due immediately if awarded provisional license)

Critical location considerations:

  • Facility must be 500 feet from all prohibited facilities including:
    •   School, church, public library, public playground or public park
  • If zoning exists, facility must be zoned properly and have documentation proving that from the local governing body like the building department
  • Facility must be 500 feet from all prohibited facilities including:
    •   School, church, public library, public playground or public park
  • If zoning exists, your facility must be zoned properly and have documentation from the local governing body like the building department proving this
  • In my experience, established industrial parks are ideal if they exist because of easy infrastructure: transportation, electricity, natural gas, water
  • It’s also valuable to be collocated with a cultivation license if you have this option

Facility specifications:

  • Waste must be quarantined and reported to the state before destruction. The 51% Colorado Rule applies to all waste.
  • Security cameras must capture all entrances and exits to the facility and any room where product could be.
  • Cameras must be streaming 24/7 to the State and be able to record with motion activation. Records must be kept for a minimum of 45 days.
  • A silent duress alarm, panic alarm, holdup alarm, and automatic voice dialer are required.

Standard industry regulations for Ohio

  • Permit must be renewed every 2 years. Permit is $100,000 biannually.
  • All owners, officers, advisors, and employees will be fingerprinted and pass a criminal records check. Anything more than a traffic ticket conviction may present a challenge. Felony convictions automatically disqualify.
  • No sales directly to patients or caregivers

Regulations Unique to Ohio

  • All industry accepted extraction methods are allowed
  • No products requiring refrigeration or warming can be possessed or sold by a dispensary.
  • There’s a 70% THC limit on infused products.
  • Every employee must be licensed with the state which costs $100-$500 depending on their role and access.
  • Requires every employee complete 16 hours of continuing education every 2 years in addition to initial training.

How to submit

Starting on December 4th thru December 15th you must hand deliver your completed application including:

  • Hard-copy paper application of section 1 and 2
  • 2 CDROM pdf versions of sections 1 and 2 plus form 1Q and all tax records

Special note: there is no requirement to submit paper versions of Form 1 Q or paper versions of tax records. It looks like the thousands of pages they received for the cultivation applications were a bit of a nuisance and they thankfully made a change.

You must hand deliver to the follow address:

Ohio Department of Commerce
Vern Riffe Center
77 S. High St, 23rd Floor
Columbus, OH 43215

Important Section 2 Reminder

There can be no identifiable information in section 2, just like in cultivation and dispensary applications. Form 1O in section 1 serves as the legend for any personally identifiable variables used in section 2. The State considers all of the following identifiable:

  • Individual, entity, or university names which could reveal the identity of the applicant or the proposed facility;
  • Personal addresses, business addresses, or individual components of an address, which includes numbers, cities, counties, municipalities, etc., which could reveal the identity of the applicant or the proposed facility;
  • Personal or entity identification numbers;
  • Contact information;
  • Company logos, trademarks, or other identifying marks;
  • Location references that would make it possible for a reviewer to identify where the proposed facility will be located;
  • References to involvement in Ohio’s marijuana legalization efforts.

With a total of 40 potential processors up for grabs scattered across the state, competition is sure to be fierce. There are dozens of strategies you can deploy to set your application apart from the crowd. Partner with someone who has been through this process over a dozen times with several wins under their belt.

Get in touch with us today to get things started.