Social Equity Ownership Program: Marijuana Establishment Licensing (MITA Panelist reference outline

Week 1 “What is the opportunity?” Module Key Points: (Need to simplify)

• How many Licenses available? (26) (2-3 mins)

– Three parts of license, 2-3 Properties:

– (1) Retail Location – Dispensary Location Property 

– (1) Offsite Cultivation site – Cultivation Property

– (1) Offsite Manufacturing site – Manufacturing and Packaging Property

• How much does it cost to apply? (2-3 mins)

– What does it (roughly) cost to start? $527,950 (500k liquid & min $27,950 in fees)

– What does the revenue stream look like for a retail dispensary? 

– Financing a dispensary operation – investment and loan opportunities 

– Local Banking known MJ friendly banks

• Who qualifies? (Rules have not been set by AZDHS but we can speculate based on the available data) (5-7 minutes)

– Populations disproportionately affected by marijuana laws in AZ. Factors taken into account will likely be race, geographic area, income levels, and arrest record expungement by way of prop 207. These are just speculations.

– Data from ACLU shows Hispanic and Black populations have a disproportionate occurrences of arrest for marijuana in maricopa county https://www.acluaz.org/sites/default/files/7.16embargofinal_the_racial_divide_2020.pdf

Story by Rose Law Group: Expungement under prop. 207 https://azcapitoltimes.com/news/2020/12/10/prop-207-brings-expungement-for-some-why-stop-there/

–”Beginning July 12, 2021, an individual who was arrested, charged, convicted or otherwise adjudicated of certain enumerated marijuana-related crimes in the new law will be eligible to have their records expunged. What have the people of Arizona decided “expunge” means? Well, it really means at least five things:

(1)  Vacates the judgment of adjudication or conviction.

(2)  Expunges all records of the arrest, charge, conviction, adjudication and sentence.

(3)  Restores all civil rights that were revoked as a result of the conviction.

(4)  Notifies all involved prosecuting and law enforcement agencies of the expungement and requires them to seal all records.

(5)  Requires that the clerk of the court seal all records relating to the expunged arrest, charge, adjudication, conviction or sentence and prohibit access to those records by anyone other than the accused or convicted individual.”

• What are the application requirements? What is the process? Forms? (5 mins we can only see early applicant view in ADHS licensing portal)

– Sample application from early applicant phase (4 pages on AZDHS portal)

“Required Forms for Early Applicants

• Adult Use Financial Institution Statement (v. 1.0)
• Adult Use Zoning Approval Form (v. 1.0)
• Adult Use Property Ownership Form (v. 1.0)
• PO/BM Attestation for Initial Establishment License (NOT for dual licensee applicants)
• PO/BM Attestation for Dual Conversion Application (ONLY for dual licensee applicants)”

– Application General process information:

– Application questions link: https://facility-licensing.azdhs.gov/s/login/?ec=302&startURL=%2Fs%2F 

– Deficiencies

– Corrections

– Substantive complete applications

What is the timeline?(2-3 minutes)

• “The Department will begin accepting applications for these 26 licenses within 6 months of adopting the final rules for the Social Equity Ownership Program. The Department does not currently have a timeline for this rulemaking; however, the website will be updated as more information becomes available.” – *source AZDHS website https://www.azdhs.gov/licensing/marijuana/adult-use-marijuana/index.php#establishment

– Estimated dates: THIS IS NOT TO BE USED AS FACT JUST ESTIMATION

-Rules draft – posted 60 days before any SEOP applications will be accepted

-NOTE***Early application phase ends march 9th and final licenses for this phase will be awarded by May, 8th 2021 at the latest.

-Latest to begin accepting applications: 

-60 days to post rules publicly + within 6 months (approx. 182 days) of adopting rules, AZDHS to begin accepting SEOP Applications. 

-Roughly 30-60 day timeline after SEOP opens the application process will complete accepting all applications 

– Licenses will be awarded to Eligible Candidates that have a substantive complete application and meet all requirements.

-NOTE*** IF THERE IS MORE THAN 1 APPLICANT AZDHS HISTORICALLY MAKES THE PROCESS A LOTTERY AMONG ELIGIBLE APPLICATIONS

Estimated first SEOP licenses to be awarded between Oct – Dec of 2021

(10 minutes) Questions from public and participants: received over 100 requests for more information about SEOP and about 5 questions that were a little more specific