Marijuana medical and recreational business is booming day by day and getting bigger every passing year. Hence, there is no better place to invest other than in this rapidly growing sector. Thanks to House Bill 523, now Ohio entrepreneurs can also try their luck in this lucrative market by opening up a cannabis dispensary. However, due to its complex licensing process, it’s not as easy as it sounds. But with proper planning, adequate capital, and loads of paperwork, it is quite feasible to succeed in this competitive market.
If you are seeking to open a cannabis dispensary in Ohio, this article can help you through all the necessary steps that need to be performed to open a dispensary.
Cannabis Market In Ohio
Ohio is on pace to hit $520 million in sales by the end of 2023, having had a 26% increase in sales in 2022.
According to BDSA forecasts, Ohio will begin selling cannabis for adult use in 2025 and will contribute an estimated $300 million in that year alone. Consequently, it is projected that Ohio’s overall legal cannabis market will reach $820 million in 2025 and an impressive $1.65 billion in 2027, making Ohio one of the states with the fastest-growing legal cannabis markets in the country.
Cannabis Taxes In Ohio
The sales tax on medical marijuana in Ohio is 5.75%.
Ohioans who purchase marijuana for recreational purposes need to pay state and local sales taxes in addition to a 10% excise tax.
As per the 2023 law that legalized cannabis for adult use, customers in Ohio are subject to a 10% tax on products at the cash register.
Cannabis Laws In Ohio
The Ohio cannabis law permits:
- Adults to possess up to 2.5 ounces of marijuana or 15 grams of marijuana extract.
- Individuals may grow up to 12 plants in their homes with at least two adults residing there, or they can buy marijuana from retail establishments.
Ohio Cannabis Dispensary Laws
- Medical marijuana dispensaries are licensed and governed by the State of Ohio Board of Pharmacy.
- The state of Ohio’s cannabis program employs the Metrc to establish a strong track-and-trace system.
- Medical marijuana may be purchased from Ohio dispensaries by qualified patients and authorized caregivers who are at least 18 years old.
- All staff members at dispensaries must undergo foundational training before they start dispensing medical cannabis.
- After dispensing any medical marijuana, a dispensary has five minutes to electronically report specific information to the state board of pharmacy.
- The legal possession of cannabis by Ohioans is limited to a 90-day supply.
Types of Medical Cannabis Licenses in Ohio
In the state of Ohio, there are four types of medical cannabis licenses that you can acquire to be part of the marijuana market.
- Cultivation
- Processing
- Dispensary
- Testing Lab
Each license has distinct regulations which means you need a separate license to run any specific type of marijuana business.
Medical Cannabis Dispensary License Application in Ohio
In early 2021, the Ohio Board of Pharmacy approved marijuana dispensaries licenses in the state from 57 to a total of 130, which opened the doors for another 73 dispensaries. Currently, Ohio has only legalized medical cannabis for its public. Although many propositions have been submitted to the government in order to legalize the recreational sale of cannabis.
Cannabis Dispensary License Requirements
The State of Ohio Board of Pharmacy licenses has provided a set of guidelines to open a dispensary in Ohio.
Certificate of Operation – A certificate of operation is the must thing to open a cannabis retail store. Dispensary owners need to follow all the federal and State statutory rules and requirements to get a certificate of operation.
Financial Plan – In order to get a dispensary license you should prepare a financial plan containing information on your capital and assets.
Business Plan – This plan should have a vital roadmap for the business and team. It is an effective way to demonstrate your business and entrepreneurial knowledge. This plan should also include inventory control information. You can start with a cannabis business plan template or request help from a cannabis business plan writer.
Operation Plan – State security, public safety, and diversion are some parameters that your business should adhere to meet compliance. The operation plan includes daily, weekly, monthly, and annual operation manuals to ensure day-to-day routine operations are followed to run the business effortlessly.
As per the provided guidelines, at the time of opening a new medical dispensary, the dispensary owner needs to provide several documents to complete the application process.
- Tax authorization form
- Zoning forms
- Trade Secret form
- Release & attestation form
- Personal ID, phone no, and email address information of the applicant
- Compliance Evidence with local ordinances
- Retail store construction/renovation schedule & budget plan
- Proposed Organizational Structure
- Ohio Secretary of State Registration
- Copy of the articles of incorporation/organization
- Address of the proposed medical cannabis retail store
- Bank statements dated no earlier than 30 days before application submission
Get a Local Permit
Just like any other business, The State Board of Pharmacy has mentioned some rules and regulations for people who are interested in opening a dispensary in Ohio. The first thing you need to do is get a local permit from the government. You need to share a potential store location to get the license.
The Key Steps to Applying for a Dispensary License in Ohio
- To open a dispensary in Ohio, a dispensary license is required. The ballot measure allows for 50 additional adult-use dispensary licenses and 40 Level III Adult Use Cultivation licenses. The DCC will review the number of dispensaries after 24 months and every two years after that to evaluate market conditions.
- At present, holders of medical marijuana licenses can run dispensaries in Ohio. Licensees who remain in good standing will receive dual licenses and be among the first to open adult-use dispensaries.
Prerequisites to Get a Dispensary License in Ohio
Although Ohio regulators are still finalizing the licensing process, here’s what we know at this stage about applying for a dispensary license.
Every applicant must apply for a license with the DCC, adhering to the guidelines established in the regulations.
The Division of Cannabis Control shall provide a license to an applicant once all the required criteria are fulfilled:
- The report from the criminal background check conducted for the application indicates the following:
- The adult-use cannabis operator applicant proves that it does not possess an ownership or investment interest in, nor have compensation ties with, nor share corporate officers or employees with any of the following:
- The applicant demonstrates that the operations will not be within five hundred feet of a prohibited facility as required by this chapter, except in cases where the prohibited facility was established within five hundred feet after the applicant submitted the application to the DCC, or after the applicant or its owners had been operating under Chapter 3796 of the Revised Code at the same location, or as otherwise authorized in this chapter.
- The applicant has demonstrated through the information provided to the DCC that it complies with the relevant state tax laws.
- The applicant is not working for a regulatory authority of a governmental entity in this state, nor does their role grant significant influence or control, as determined by the DCC, over their ability to conduct business here.
- The criminal offenses that will result in the applicant being disqualified from licensure; and
- The criminal offenses will not disqualify the applicant from licensure if the conviction or guilty plea happens more than five years before the application is submitted.
- An adult-use cannabis testing lab licensed under this chapter or
- An applicant requesting a license to carry out adult-use laboratory testing.
- Applications for a license must be made on a form prescribed by the DCC and must include all necessary information. Although the full details are not yet specified, the following information will likely be required as a minimum:
- Personal information such as name, address, and date of birth.
- Detailed information about the business’s management structure, ownership, and control, including names, ownership stakes of various stakeholders, and details of any past or present ownership interests in cannabis businesses, corporate records, financial agreements, and financial responsibilities.
- The physical address and legal property description of the business location.
- A general description of the site(s) where the applicant plans to operate, including planned square footage.
- A cannabis dispensary security plan in Ohio.
- A comprehensive business plan.
- Documentation proving eligibility for social equity status.
Every applicant is required to provide two sets of fingerprints and a photograph, as per the Division of Cannabis Control’s rules, along with the application form. The division will charge an application fee to cover the actual regulatory expenses and background checks for each licensee.
Completed applications will be assessed, and licenses will be granted accordingly.
Dispensary License Application Fee
The cannabis dispensary license application fee is $5,000 which is not refundable. When your application is approved, your business needs to pay additional fees of $ 80, 000 every two years to maintain the license. Annual renewal fee is $80,000.
As per the regulations, owners must keep $250,000 in funds available in the organization’s account for uncertainty or other reasons. Although, the organization must present at least a year plan mentioning how to manage funds and other business expenses for the first year.
Dispensary owners need to pay between $100 and $500 as a registration fee for each employee. If you are interested in doing an attractive setup or renovation for the dispensary, it will cost $5000 extra. There are some other fees that you might need to consider for certain situations. For example;
Relocation fee is $5,000.
Change in ownership fee is $5,000.
Employee identification card fee is $50.
Reissued dispensary certificate of operation fess is $ 50.
Ohio Social Equity Program for Cannabis Businesses
Under the new adult-use cannabis laws, Ohio has made progress toward social equity. The Cannabis Social Equity and Jobs Program will be supported by the Cannabis Social Equity and Jobs Fund, which is funded by the 10% cannabis sales tax revenue.
This program will offer financial aid and assistance for license applications, aiming to reduce barriers to ownership and create opportunities for individuals based on the following considerations:
The business’s financial standing, along with the personal wealth of its owner or owners.
Social disadvantage based on any of the following:
- The owner(s) of the business demonstrate membership in a racial minority group or face personal disadvantage due to race, ethnic origin, gender, physical disability, or extended residence in an area with high unemployment.
- The owner(s), or their spouse, child, or parent, have been arrested, convicted, or found delinquent for a marijuana-related offense as defined by the Department of Development’s rules, before the effective date of this section.
Economic disadvantage is established by business size and economic thresholds, along with criteria intended to encourage economic growth by providing licenses to businesses in qualified census tracts.
Medical Retail Store Location Regulations & Restrictions
Whether you’re interested in opening a medical retail store or already own a dispensary, to run it smoothly, you need to follow state and federal regulations. Cannabis retail stores should at least maintain 500 feet of distance from schools, public playgrounds, libraries, parks, and spiritual places. Dispensaries must fulfill the local zoning regulations within the respective areas.
Before opening a dispensary, you need to do research on the local market and surroundings to find out whether it is a suitable location to open a cannabis store or not. You also need to check whether there is any other cannabis dispensary located in the same area or what are the security measures of the particular location.
Get Familiar With Rules & Regulations
After the legalization of marijuana in Ohio, the government also provided material that contains all the needed information on how to sell marijuana and marijuana products legally.
Get yourself updated with cannabis laws and statutes applicable to your country, state, and city. These rules and regulations do mention social equity, proper packaging, and many more.
Cannabis Dispensary Floor Plan
According to the cannabis regulation each dispensary is required to follow site-specific guidelines. For example:
- The dispensary department
- Restricted access and storage areas
- Waiting room
- Patient & caregiver consultation area
- Enclosed and secured delivery bay/areas
- Marijuana and marijuana products storage
- A vault (as per C.F.R. 1301.72(a)(3) (6/30/2021))( this vault shouldn’t be visible to the visitors or patients)
- Parking area.
Wrap Up
Opening a dispensary in Ohio can be a complex and time-consuming process, but with a lot of hard work, paperwork, and research, cannabis dispensaries can turn into a profitable business. To be frank, there are some vital steps to consider when you are interested in opening a dispensary. We hope this post has provided you all necessary insight on how to get a license and open a dispensary in Ohio. In case, if you still have doubts, you can seek professional help.
How Can Cure8 Help
Cure8, a comprehensive IT and dispensary security solutions provider can assist in launching a cannabis dispensary in Ohio. By offering cutting-edge security solutions like advanced video surveillance systems, robust access control measures, state-of-the-art alarm systems, and secure storage solutions, Cure8 ensures the protection of your dispensary. We also help develop comprehensive cannabis dispensary security plans, encompassing risk assessments, employee training, and emergency protocols.
Additionally, Cure8 helps create compliant cannabis security solutions, including IT management, seed-to-sale tracking, inventory management, and adherence to Ohio’s stringent regulations. By partnering with Cure8, you can establish a secure, compliant, and successful cannabis dispensary in Ohio.
