Alabama became the 36th state to allow cannabis for medical use when Gov. Kay Ivey signed into law the Darren Wesley ‘Ato’ Hall Compassion Act on May 17, 2021. The act establishes a process through which applicants will compete for a limited number of licenses in the following categories: (1) cultivator; (2) processor; (3) dispensary; and (4) “integrated facility” (which can cultivate, process, transport, and dispense medical cannabis under one license), as well as a to-be-determined number of licenses for secure transporters and testing laboratories. A 14-member Medical Cannabis Commission licenses and regulates the medical cannabis program, with input from the Alabama Department of Agriculture and Industries on cultivation matters. The act requires that the Commission and the department adopt regulations that allow license applications by September 1, 2022.
This article provides an overview of the requirements for obtaining a dispensary license, and is part of a series of similar overviews for the other five license categories.
What is a dispensary license?
A dispensary license authorizes the licensee to: (1) purchase and transfer cannabis from a processor, integrated facility, or cultivator, if the cultivator contracted with a processor to process its cannabis on the cultivator’s behalf; and (2) dispense and sell medical cannabis to a registered qualified patient or registered caregiver.
How many dispensary licenses will be issued?
The act authorizes the Commission to issue four dispensary licenses. At least one license must be awarded to a business entity that is 51%+ owned by individuals of “African American, Native American, Asian, or Hispanic descent,” and “managed and controlled” by such individuals “in its daily operations.” Each dispensary licensee may operate up to three dispensing sites, each of which must be in a different county from any other dispensing site and is subject to other restrictions.
What are the requirements for obtaining a dispensary license?
Applicants for a dispensary license must pay a non-refundable application fee of $2,500. Each “owner, shareholder, director, [and] board member” of an applicant, along with each “individual with an economic interest in an applicant,” must submit to a “state and national criminal background check.” If any “owner, director, board member, or individual with a controlling interest” has been “convicted of or released from incarceration for [any] felony” or “convicted of a controlled substance-related felony” within the last 10 years, the applicant is ineligible for a license.