Regulators announce new application window timeline for marijuana microbusiness licenses

Regulators announce new application window timeline for marijuana microbusiness licenses

 

In November 2022, Missouri voters approved Amendment 3, which legalized adult use marijuana in Missouri. In doing so, the Missouri Department of Health and Senior Services (DHSS) was tasked with developing a lottery system to award a limited number of new small business licenses, known as “microbusinesses.”

The microbusiness license type is an important innovation in Missouri’s legalization of marijuana, providing an opportunity for small business owners, particularly those who have been historically marginalized, to enter the market and succeed. The program’s social equity components are meant to provide an opportunity for those who have been disproportionately affected by Missouri’s marijuana laws. The purpose of these licenses was to provide an opportunity for marginalized or under-represented individuals to participate in the legal marijuana market.

There are two types of microbusiness licenses available: microbusiness dispensary licenses and microbusiness wholesale licenses. Microbusiness dispensary facilities are licensed to dispense marijuana products for medical or adult use, while microbusiness wholesale facilities are licensed to cultivate and manufacture marijuana products for medical or adult use. If cultivating, a microbusiness wholesale facility may cultivate up to 250 flowering plants at any given time and will also be able to manufacture infused products and extracts.

To be eligible for a microbusiness license, applicants must meet at least one of the following requirements:

  • Have a net worth of less than $250,000 and have had an income below two hundred and fifty percent of the federal poverty level
  • Have a valid service-connected disability card issued by the United States Department of Veterans Affairs, or successor agency
  • Be a person who has been, or a person whose parent, guardian, or spouse has been arrested for, prosecuted for, or convicted of a non-violent marijuana offense, except for a conviction involving provision of marijuana to a minor or a conviction of driving under the influence of marijuana. The arrest, charge, or conviction must have occurred at least one year prior to the effective date of this section.
  • Reside in a ZIP code or census tract area where 30% or more of the population lives below the federal poverty level; or the rate of unemployment is 50% higher than the state average rate of unemployment; or the historic rate of incarceration for marijuana-related offenses is 50% higher than the rate for the entire state; or graduated from a school district that was unaccredited, or had a similar successor designation, at the time of graduation, or has lived in a zip code containing an unaccredited school district, or similar successor designation, for three of the past five years.

On June 6, the Department will make available microbusiness license forms and instructions for review.

   

Originally slated for the one-month period between September 4 and October 4, the Department announced on Tuesday that it will open the first application window for microbusiness licenses on July 27 to run until August 10, 2023. But in moving up the opening date, the Department has significantly shortened the application window from  30 days to just 14 days.

The Department will issue six microbusiness licenses in each of the eight Missouri congressional districts, for a total of 48 microbusiness licenses. Two of the six licenses in each district will be for microbusiness dispensaries, and four will be for wholesale facilities. DHSS will issue an additional 48 licenses in 2024 and another 48 in 2025, with application periods to be announced at a later date.

The random lottery process is designed to ensure the program’s integrity. The Missouri Lottery will conduct the drawing without reference to the applicants’ identities, using certified software to produce random results.

While microbusiness licenses create a subsection of the marijuana market in Missouri, the separation between the markets ensures more opportunity to microbusiness licensees. As Legal Missouri 2022 Campaign Manager, John Payne, explained to Greenway previously, “As many cultivators coming into the medical market now can attest, battling for shelf space against well-established brands is very difficult. Newer dispensaries can always compete by finding underserved locations, but we want to ensure that these craft cultivators can gain a foothold in the market, and we believe this is the best way to accomplish that. The main advantage of a lottery is that everyone has an equal chance in the process.”

For successful microbusiness operators, there is potential to grow and expand. The constitution requires that as new comprehensive facility licenses become available, 50% of those licenses must be awarded to operational microbusiness facilities, creating an opportunity for a revolving door of small business growth in the future.