Arizona Cannabis Business Licenses
WHAT IS ARIZONA'S CURRENT CANNABIS MARKET STATUS?
Arizona legalized cannabis for medical purposes on November 2, 2010 when voters supported Proposition 203 (Prop 203), a medical cannabis initiative. Currently, there is a new campaign advocating for the legalization of adult-use recreational cannabis through voter referendum. The initiative, Smart and Safe Arizona, has collected enough signatures to submit a petition for adult-use legalization on the 2020 ballot. This would allow adults 21 and older to grow up to six plants in their homes and possess up to one ounce of cannabis. If passed, the initiative could lead to more Arizona cannabis legislation such as expunging cannabis convictions and the introduction of recreational cannabis licenses and businesses in Arizona. The law will also put an emphasis on Social Equity Applicants, encouraging people from areas that were disproportionately affected by the War on Drugs to apply for cannabis licenses.
WHAT ARE ARIZONA'S CANNABIS LAWS?
The primary cannabis law in Arizona is Proposition 203 which allows qualifying patients and caregivers to purchase, possess, and consume medical cannabis obtained from a state-licensed dispensary. All medical cannabis dispensaries in Arizona must be nonprofit businesses under Arizona laws 36-2806, which states a registered nonprofit medical marijuana dispensary will be operated on a not-for-profit basis and they are subjected to government oversight. Though Arizona's medical cannabis industry is nonprofit, similar to California and Colorado, it’s a common misconception that business-owners and their employees will not make sufficient salaries. However, Arizona medical cannabis businesses have proven to be successful for business-owners and employees under the nonprofit regulations.
In 2019, Gov. Ducey signed Senate Bill 1494 which states that beginning on November 1, 2020, all Arizona dispensaries must test their inventory for potency, as well as microbial contamination, heavy metals, pesticides, and other contaminants, similar to other highly regulated markets. After August 2019, qualifying patients identification cards now expire after two years instead of one.
In November, the Safe and Smart Arizona Act will appear on the general election ballot. If passed, the initiative will legalize recreational cannabis within the state of Arizona and also outlines eligible applicants who can apply for cannabis business licenses. Eligible applicants include existing non-profit medical cannabis establishments and the state will also accept 26 Social Equity Applicants from communities disproportionately impacted by the War on Drugs.
WHAT IS ARIZONA'S CANNABIS LICENSING TIMELINE & CANNABIS APPLICATION PROCESS?
At this time, the medical cannabis dispensary licensing window is closed in Arizona. However applications are suspected to open back up in 2021, and possibly new legislation regarding recreational cannabis dispensaries in Arizona could be underway after November. Once the application is posted on the Arizona Department of Health Services website, the department will accept applications for a period of ten business days, 30 days after the application is posted. Individuals over the age of 21 that submit a criminal background check can apply. Approvals will be given by the Department of Health Services 60 days after receiving the application.
WHAT IS THE HISTORY OF CANNABIS IN ARIZONA?
In 1996, Arizona passed the Drug Medicalization, Prevention and Control Act, also known as Proposition 200. This act allowed physicians to prescribe cannabis for qualifying conditions, however later failed to be implemented due to conflicts with federal law. Proposition 203, a medical cannabis initiative that also sought to decriminalize recreational use, was introduced in 2002 and failed to secure enough votes.
In 2010, Prop 203 did pass with 50.7% of votes. Doctors could recommend up to 2.5 ounces of medical cannabis to patients with qualifying conditions. However, many policymakers in Arizona did not approve of Prop 203 and tried to sue state employees on a federal level. As a result, Arizona suspended medical cannabis licenses for an extended period of time until those lawsuits were dismissed. In 2012, Governor Brewer approved legislation that prohibited the possession of medical cannabis on college campuses, which was later found unconstitutional by the Supreme Court and repealed.
In 2016, there was an initiative called Proposition 205 proposing the legalization of recreational cannabis use, which ultimately failed. In 2020, it’s expected that the Smart and Safe Act will appear on the November ballot, legalizing cannabis in Arizona for adult-use.
DOES ARIZONA HAVE A HEMP PROGRAM?
ARE YOU PREPARING FOR THE ARIZONA CANNABIS MARKET?
Arizona is not currently accepting medical cannabis applications, but it takes time and effort to prepare for when the application process reopens. Point7 has the resources and knowledge needed to ensure an applicant is prepared and stands out to application reviewers. Email today to schedule a call with a dedicated Point7 team member.