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How to Get a Dispensary License in Maryland 2024

June 5, 2024

Maryland has embraced a comprehensive cannabis policy encompassing both medical and recreational use: a medical marijuana program was initiated in 2017, granting qualified patients access to this treatment option; further expansion came in July 2023 with the legalization of recreational cannabis possession and purchase for adults aged over 21. Maryland’s adoption of cannabis has been gradual but impactful. The path started with House Bill 881 in 2014, legalizing medical marijuana for specific conditions. Senate Bill 949 of 2017 expanded this program, and Senate Bill 708 in 2021 decriminalized recreational use, allowing personal possession and cultivation of limited amounts.

Starting a cannabis dispensary in Maryland requires a thorough understanding of the legal framework, eligibility requirements, and application process. This guide from IndicaOnline provides a detailed overview of the steps necessary to obtain a dispensary license in Maryland in 2024.

Applying for a Maryland Cannabis License in 2024

Applying for a cannabis license in Maryland in 2024 involves several steps. This guide will provide a detailed overview of the process, requirements, and critical considerations for prospective applicants.

Understanding the Types of Licenses

Maryland offers several types of cannabis licenses, including:

  • Grower License
  • Processor License
  • Dispensary License
  • Testing Laboratory License
  • Transporter License

Each dispensary license type has specific requirements and allows for different activities within the cannabis market.

Eligibility Requirements

To apply for a cannabis license in Maryland, applicants must meet specific eligibility requirements, including:

  • Age and Residency: Applicants must be at least 21 years old and a resident of Maryland.
  • Background Checks: All applicants must pass a criminal background check. Certain felony convictions may disqualify some applicants.
  • Financial Stability: Applicants must demonstrate financial stability and the ability to maintain operations.

Prepare Required Documentation

Gathering the necessary documentation is a critical part of the application process. Required documents typically include:

  • Proof of Maryland residency.
  • Detailed business plan.
  • Financial statements and proof of funds.
  • Security and inventory management plans.
  • Zoning compliance verification.

Application Process

Pre-Application Preparation

  • Research and Planning: Ascertain which type of dispensary license you need and the specific requirements. Review Maryland’s cannabis regulations and guidelines here on the Maryland Medical Cannabis Commission (MMCC) website.
  • Business Plan: Develop a comprehensive business plan outlining your operations, marketing strategy, and financial projections.
  • Location Selection: Identify a compliant site for your business and ensure it meets zoning requirements and has the necessary infrastructure.

Application Submission

  • Create an Account: Register for an account on the Maryland OneStop portal.
  • Complete Application Form: Fill out the application form specific to the type of license you are seeking. The form will require detailed information about your business, ownership, and operational plans.
  • Submit Documentation: Upload all required documents, including your business plan, financial statements, background check results, and proof of residency.
  • Pay Application Fee: Pay the non-refundable application fee as specified on the MMCC website. Application fees are $5,000 for standard licenses and $1,000 for micro licenses.

Submit the Application

The application process involves several steps, including conditional licensing and active licensing:

  • Conditional License: If you pass the pre-qualification phase, you will receive a conditional dispensary license, which allows you to proceed with setting up your dispensary. During this phase, secure your location, finalize your business plan, and prepare for a final inspection.
  • Active License: Once all conditions have been met, including passing the final inspection, you will receive an active dispensary license. This permits you to open your dispensary to the public. For details, visit the Maryland Cannabis Administration Pre-Qualification page.

Application Review

  • Initial Review: The MMCC will conduct an initial review of your application to ensure it is complete and meets the basic requirements.
  • Evaluation: Applications are evaluated based on criteria such as business viability, security plans, community impact, and financial stability.
  • Interviews and Inspections: As part of the evaluation process, you may be required to participate in interviews or site inspections.

Licensing Decision

  • Approval or Denial: The MMCC will notify you of the decision. If approved, you will receive a provisional license and must complete any additional requirements, such as facility inspections and operational readiness checks.
  • Final License: Upon meeting all conditions, you will receive your final dispensary license and be clear to operate.

Legal Considerations for Operating a Dispensary in Maryland

Compliance with state regulations is critical for the success of your dispensary. Regularly review the Maryland Cannabis Administration website for updates on regulations and ensure your business practices align with current laws. Key areas of compliance include:

  • Security Measures: Implement comprehensive security measures, including surveillance cameras, alarm systems, secure storage for cannabis products, and procedures for handling cash.
  • Inventory Management: Maintain accurate inventory records to ensure compliance with state regulations and provide a seamless customer experience. Consider using a cannabis POS system to streamline inventory management.
  • Advertising and Marketing: Ensure all marketing efforts comply with the state advertising code. Avoid misleading claims and adhere to restrictions on advertising content and placement.

Local Regulations

  • Zoning Compliance

In Maryland, dispensaries must comply with specific zoning requirements set by local municipalities. Key considerations include:

  1. Distance from Sensitive Areas: Dispensaries must be located at least 1,000 feet away from schools, parks, and other areas frequented by minors. This ensures cannabis retail operations do not have a negative impact on vulnerable populations.
  2. Proximity to Other Dispensaries: There is a restriction on the proximity of dispensaries to each other to prevent market saturation. Dispensaries must be at least half a mile apart from one another.
  • Local Permit

Obtaining the necessary local permits is essential for a legal dispensary license. The requirements include:

  1. Business Licenses: Apply for a local business license from your city or county’s licensing department. This is a fundamental requirement for all businesses operating within the jurisdiction.
  2. Health Permits: If your dispensary plans to sell edible cannabis products, you may need health permits from the local health department. These ensure all food products meet safety standards.
  3. Additional Approvals: Depending on your location, additional permits may be required, such as fire safety inspections, building permits, and signage approvals. Each municipality has specific requirements, so it’s crucial to check with local authorities.
  4. Documentation: Applicants must submit comprehensive documentation, including business, diversity, and operational plans.

Maintaining Compliance

Maryland dispensaries are required to follow strict state rules. These rules, found in the Code of Maryland Regulations (COMAR), cover important areas like security, product testing, and reporting.

Once licensed, it is crucial to maintain compliance with all state regulations:

  • Reporting and Tracking: Use the Metrc system for seed-to-sale tracking. Detailed information on Metrc compliance can be found here.
  • Renewal: Licenses must be renewed annually and the application and fees are required to be submitted before the expiration date. The renewal fee for dispensaries is $25,000 over five years.
  • Inspections: Expect regular inspections by the MMCC to ensure ongoing compliance with state regulations.

To make sure the state’s rules are followed smoothly, choosing a point-of-sale (POS) system that works with Metrc is crucial. The best systems offer clear tools to manage and track your Metrc account, all under your control. IndicaOnline provides a robust POS system that fully integrates with Metrc, which helps dispensaries keep accurate records and stay compliant with minimal effort.

This integration offers two key advantages. First, it ensures you meet all relevant state regulations. Second, it allows for easier and more accurate tracking of inventory, sales data, and other important information. This saves dispensaries significant time and money while reducing the risk of costly errors.

Financial and Record-keeping Requirements

Maryland dispensaries must maintain accurate financial records and adhere to state requirements for record-keeping and reporting. Key areas include:

  • Financial Statements: Keep detailed financial records, including income statements, balance sheets, and cash flow reports. This is essential for regulatory compliance and financial management.
  • Inventory Tracking: Use an inventory management system to track all cannabis products from acquisition to sale. This ensures compliance with state regulations and helps manage product availability and quality. IndicaOnline offers a highly efficient cannabis inventory management solution, which gives retailers complete control over their information at all times.
  • Tax Compliance: Ensure timely and accurate payment of state and local taxes, including sales and excise tax and any other applicable taxes.

In Maryland, the Cannabis Reform Act (HB 556/SB 516) governs the taxation of cannabis, with a 9% sales and use tax imposed on the sale of adult-use cannabis. This tax is collected at the point of sale and remitted to the state. Cannabis businesses are required to remit taxes regularly. Detailed guidelines on tax remittance and reporting are available on the Maryland Comptroller’s website.

Eligibility for Social Equity Applicants

Maryland is committed to promoting social equity in its cannabis industry, with a state program aimed at creating opportunities for individuals from communities disproportionately impacted by past drug policies. A social equity applicant is defined as an entity where at least 65% is owned by individuals who meet specific criteria. According to the Maryland Office of Social Equity, these include:

  • Residing in a disproportionately impacted area for at least five of the last ten years.
  • Attending a public school in a disproportionately impacted area for at least five years.
  • Having a cannabis-related arrest or conviction.

IndicaOnline offers a social equity program that seeks to create an equitable ownership and employment environment in the cannabis industry.

Operating in Maryland’s Cannabis Industry

Launching a dispensary in Maryland represents a significant achievement. You’ll join a growing industry as the state’s recreational cannabis program expands rapidly. Obtaining a dispensary license in Maryland for 2024 requires careful attention to a detailed and strictly enforced process. Following the established steps and meeting all the requirements will lead to a successful license application and allow you to operate within Maryland’s thriving cannabis sector.

Starting a cannabis dispensary in Maryland is an exciting step, and IndicaOnline can be your trusted partner. We offer the tools and support you need to run your business smoothly, follow all the rules, and achieve success. From point-of-sale systems designed for dispensaries to programs for managing inventory and keeping track of regulations, IndicaOnline is here to help Maryland retailers build a strong foundation for their cannabis business.