Medical Marijuana Rules Released
An photo of some California issued medical marijuana bottles and a marijuana pipe. Image by Adam Guzzon.
By John Guzzon
Modern Times Magazine .com
March 29, 2011 — The Arizona Department of Health Services released its final rules for regulating the legalized sale and use of marijuana for medical purposes yesterday, mandating that dispensary owners and operators must be state residents for at least three years, that they have access to at least $150,000 in capital and that no one has ever filed for bankruptcy.
After the passage of proposition 203, the Department of Health Services was tasked with implementing the medical marijuana program. The proposition called for no more dispensaries than the equivalent number of pharmacies. DHS decided to limit dispensaries by assigning one to each Community Health Analysis Areas, or CHAAs.
Visit the DHS medical marijuana website
Speculation is that competition for these non-profit dispensaries in the metropolitan areas will be very high. Thousands attend public comment sessions and a cottage industry of ‘marijuana growing colleges’ have drawn thousands as well.
In rules that will surely thin the herd of potential dispensary owners in metropolitan areas, the DHS outlined a set of progressing requirements that would be necessary if multiple applications are received for a CHAA. If multiple applications meet each of the eight progressing requirements, then a lottery will be held to determine the winner.
The progressing requirements are applicable to all applicants, principal officers and board members of the dispensary application:
1. Submitting Arizona state income tax returns for the previous three years.
2. If applicable, current on paying court-ordered child support.
3. Not delinquent paying taxes, interest, or penalties due to a governmental agency.
4. No unpaid judgments due to a governmental agency.
5. No defaults on a government-issued student loan.
6. Each individual who has 20 percent or more interest in the dispensary is the applicant or a principal officer or board member of the dispensary.
7. Have never filed for personal or corporate bankruptcy.
8. Documentation, from an in-state financial institution or an out-of-state financial institution, demonstrating that the dispensary has at least $150,000 available to begin operating was submitted with the dispensary registration certificate application.
Read complete official rules
DHS Director Will Humble said in his blog Monday that for a higher level of success, would-be owners should probably look to one of the more rural CHAAs.
“We’re hoping that prospective dispensary applicants decide to apply in rural CHAAs- recognizing that competition for dispensaries in urban AZ will likely be robust. By applying in a rural CHAA, they can increase their chances of successfully being awarded a registration certificate and keep their options open for moving to a part of the state with a high density of qualified patients after a few years. Likewise, if a prospective applicant has had a previous bankruptcy or lacks access to $150K in capital (which are part of our competitive screening criteria), they’ll be in a better position to compete for registration certificates in rural AZ,” Humble said.
The Arizona Medical Marijuana Association, the group behind the passage of Prop. 203, said at a public hearing in February that a stringent application process which includes a bond or proof of financing was necessary to best provide responsible services to patients. Those best identified as “mom and pop” owners and supporters, said they just wanted a fair chance at a proposed lottery for areas where there are multiple license applicants.
Another change from the proposed rules that many commented on at public hearings is the hours these dispensaries can be open. The rules limit dispensing to 30 hours each week between 7 a.m. and 10 p.m. If a dispensary intended to be open from 7 a.m. to 10 p.m., they would only be able to be open for two calendar days.
Those wishing to obtain a prescription card can begin applying in April, but dispensaries will not be awarded until July. It is unknown when the first dispensary will actually open is doors.
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