OKLAHOMA CITY – Apparently the days of unfettered growth of the medical marijuana industry in Oklahoma are drawing to an abrupt close, because marijuana regulation has been a high priority for the Legislature this year.
Dozens of cannabis measures were filed in the House of Representatives and the Senate, but the lawmaking process – often equated to making sausage – has whittled down the numbers considerably.
A dozen measures to impose strict requirements on the industry in an effort to deter bad actors and “black market” activities have been signed into law, sent to the governor’s desk, or awaited a final vote in the Legislature this week. Among them:
A compromise version of House Bill 4055 would require all medical marijuana growers to inform their electricity provider of their licensed status. Additionally, growers would be compelled to provide the Oklahoma Medical Marijuana Authority with monthly reports listing the growers’ electricity usage and water consumption.
Refusal or failure to submit the monthly reports, or use of an unpermitted water source, would result in permanent revocation of the grower’s state license.
HB 4055 passed the House on May 18 and was transmitted to the Senate.
Oklahoma had 7,724 licensed marijuana growers on May 15 – an average of 100 per county – according to the OMMA.
Senate Bill 1737 would require all medical marijuana commercial growers who operate an outdoor MMJ production facility to register with the Oklahoma Department of Agriculture, Food and Forestry as an environmentally sensitive crop owner, effective Nov. 1.
In addition, MMJ commercial growers would have to provide their business name, address, global positioning system coordinates for all outdoor medical marijuana production facilities.
SB 1737 was transmitted to Governor Stitt on May 19.
The OMMA would be empowered by Senate Bill 1704 to revoke the business license of any person directly involved in the diversion of marijuana if an investigation showed a pattern of diversion or negligence.
The bill would require employees of a licensed medical marijuana business to apply for credentials authorizing them to work in the MMJ industry, beginning Jan. 1, 2024. In a related matter, the OMMA would be permitted to contract with one or more third-party vendors to provide the credentialing services
SB 1704 breezed through the Legislature by combined votes of 131-2 and was sent to the Governor’s Office on May 19.
The OMMA would be required by House Bill 3971 to employ “secret shoppers” to buy medical marijuana products from licensed dispensaries for the purpose of conducting compliance tests.
OMMA secret shoppers would have to inspect at least 50 licensed dispensaries each year starting in 2024, and secret shoppers would be required to inspect 10% of all MMJ dispensaries starting in 2025. Oklahoma had 2,286 licensed dispensaries on May 15, the OMMA reported.
HB 3971 passed the House on May 19 and was sent to the Senate.
If the owner of property where marijuana crops have been grown and harvested abandoned the site without restoring it to its previous condition, the violator would be guilty of a misdemeanor under House Bill 3752.
Punishment could be a one-year county jail sentence and/or a fine of up to $100,000. Also, the court could order the individual to reimburse the county for the cost of remediating any damage to the land, and a commissioned law enforcement officer could seize the abandoned/deserted property.
The bill passed the House on May 17 and was transmitted to the Senate.
Any person or company seeking licensure as an MMJ dispensary, grower, processor and transporter would be required by House Bill 3734 to first apply for a temporary license valid for six months. That license would be conditional and would not authorize the licensee to sell, grow, process, or transport medical marijuana. Nor would the OMMA be obligated to issue an annual license to that applicant.
Those applying for a temporary license, or a business license renewal, would be required to provide the OMMA with business formation documents; financial information; a list of every person with a financial interest who is not an owner; a declaration whether the applicant has ownership or financial interest in any other licensed MMJ business; a rental agreement, title or deed to the property; and evidence of insurance.
In addition, applicants for a grower’s license would be compelled to identify all sources of electric power for their farm, coordinates of their water sources, and a proposed cultivation plan.
A compromise version of HB 3734 passed the House on May 17 and was delivered to the Senate.
Under House Bill 3208, the OMMA could impose a moratorium on processing and issuing new MMJ business licenses “for an amount of time the Authority deems necessary.”
The temporary suspension would start Aug. 1, 2022, and conclude on Aug. 1, 2024, or at any point prior to that date if “all pending licensing reviews, inspections, or investigations” of applications received on or before Aug. 1 were completed by the agency.
The moratorium would not apply to license renewals, or to issuance of new licenses due to a change in ownership or location of a licensed business, the bill stipulates. An exception would be a renewal application submitted by a licensee subject to any disciplinary action that might result in revocation, suspension or nonrenewal of the license.
HB 3208 was endorsed by the Legislature and was sent to the Governor on Friday.
Senate Bill 1511 forbids any new MMJ commercial grower from locating within 1,000 feet of any established public or private school “as measured from the nearest property line.” The restriction went into effect immediately with the Governor’s signature on March 30.
A companion measure, Senate Bill 1726, expands the MMJ dispensary setback requirement to include technology centers and commercial growers, and prohibits any marijuana farming operation from adjoining a public or private school. The Legislature approved the bill and sent it to the Governor’s Office on May 17.
With enactment of Senate Bill 1543, the Oklahoma Medical Marijuana Authority will become a stand-alone agency, rather than a subdivision of the State Department of Health, on Nov. 1. All licenses already granted will remain in effect.
The governor signed the 77-page bill into law on May 11.
One year after establishing a formula for allocating proceeds from the 7% excise tax on medical marijuana, state lawmakers want to alter the apportionment.
Senate Bill 229 enacted in 2021 spelled out how the receipts from the 7% MMJ excise tax would be disbursed.
59.23% of the first $65 million in revenue (or $38,499,500) has been apportioned to the State Public Common School Building Equalization Fund, which is also known as the Redbud School Funding Program for disadvantaged public and charter schools.
34.62% of the first $65 million (or $22,503,000) has been earmarked to underwrite operations of the Oklahoma Medical Marijuana Authority.
6.15% of the first $65 million (or $3,997,500) has been allocated to the State Health Department for drug and alcohol rehabilitation programs.
Any MMJ tax collections above $65 million are deposited in the state’s General Revenue Fund.
House Bill 3083 would modify the apportionment, effective July 1.
77.97% would be earmarked for the State Public Common School Building Equalization Fund for redbud school grants to disadvantaged public and charter schools.
13.56%, up to $8 million annually, would be routed to the Department of Mental Health and Substance Abuse Services for drug/alcohol rehabilitation and prevention.
8.47% would be deposited in the County Sheriff Public Safety Grant revolving fund until June 30, 2025, to support sheriff’s departments in their enforcement of state laws that regulate medical marijuana. Starting July 1, 2025, the tax receipts would go to the OMMA revolving fund. The total amount would be limited to $5 million in any fiscal year.
Any surplus would be deposited in the state’s General Revenue Fund.
The 7% medical marijuana tax produced $56 million in Calendar Year 2020, $66 million in Calendar Year 2021, and $19 million during the first four months of this year, state Tax Commission ledgers reflect.