How to Open a Dispensary in Rhode Island

Overview

Are you interested in learning more about how to open a dispensary in Rhode Island? On this page, we will keep you up to date on the most recent news and information pertaining to starting a cannabis business in Rhode Island. This page contains valuable insights about what is to come in the following few months.

For the first time, a chamber of the General Assembly has voted in favor of recreational marijuana. The Rhode Island Senate approved a Senate Bill 568 introduced in March by Senate Majority Leader Michael McCaffrey and Health & Human Services Chairman Joshua Miller to legalize recreational marijuana use for adults.

On top of the bill filed by Sen. McCaffrey and Sen. Miller, two bills were also filed. Gov. Dan McKee included a plan to legalize marijuana in Article 11 of his 2022 fiscal year budget proposal. Rep. Scott Slater also filed on the House side a legalization measure

Later this year, before the end of 2021, Rhode Island could still have a chance to end cannabis prohibition and finally legalize cannabis for adults. 

The Opportunity Size

According to Gov. McKee’s fiscal analysis, Rhode Island could generate marijuana tax revenue of $1.7 million in the fiscal year of 2022 and grow to $16.9 million by 2023.

Numbers from Statistica.com show that marijuana sales in Rhode Island will reach approximately 167.6 million U.S. dollars by 2025. With a population size expected to reach about 1.1 million in 2021, it’s apparent the state will be a great market to start a cannabis business.

Local Cannabis Restrictions & Laws

Rhode Island is one of the states in the U.S. to have completely legalized medical marijuana since 2011, but there are still many inconsistencies in the law across the state. Some cities and towns have dealt with the issue differently because this is at its heart a land-use problem. Since this legalization is not specifically mentioned in state zoning law, some municipalities do not permit it anywhere. Others enable it only under particular conditions, such as requiring a special use permit in certain circumstances.

The Rhode Island League of Cities and Towns released a statement on April 2021 about proposals for adult-use marijuana legalization. According to the group, cities and municipalities should be able to opt out through their local councils instead of a ballot referendum.

If recreational marijuana is legalized this year, Newport City recently expressed a desire to have the authority to prohibit adult-use marijuana sales in the city. Meanwhile, Middletown is prepared to take steps to prevent marijuana dispensary sales. The Middletown Town Council would ban compassion centers and retail marijuana stores while allowing cultivation centers and testing providers in some areas of town. It will also enable caretakers and patients to grow cannabis.

In this section, we’ll keep you up to date on all important changes in Rhode Island’s 39 municipalities, including their respective positions, limits, and outright prohibitions on recreational cannabis.

Medical Marijuana

In 2006, Rhode Island became the eleventh state to legalize medical marijuana. The Edward O. Hawkins and Thomas C. Slater Medical Marijuana Act was passed in 2005, with a 52-10 vote in the state House and a 33-1 vote in the state Senate. In-state patients possessing a Rhode Island registry ID card can consume, possess, and cultivate cannabis. Registered patients are allowed to possess up to 2.5 ounces of usable cannabis and grow up to 12 plants. Full text of the bill can be viewed here.

An individual may be eligible to register as a medical marijuana patient if he or she suffers from a qualifying debilitating condition such as cancer, glaucoma, or HIV. You may check the full list of approved conditions by visiting this website

According to a Medical Marijuana  Program Report presented to the Rhode Island General Assembly, there were 19,463 active registered patients, 656 active registered caregivers, and 682 active authorized purchasers in the state as of June 30, 2021. 

Medical Marijuana Dispensary and Cannabis Business Opportunities

There are three types of cannabis business licenses issued in Rhode Island:

Licensed Compassion Centers — Permitted to sell to qualified patients and caregivers. Possession is restricted to what is cultivated in their facility and acquired from cultivators.

Licensed Cultivators — Permitted to supply only to Compassion Centers. Possession is restricted by the class of their license as well as by the demand in the market.

Licensed Cooperative cultivations — Patients or caregivers cultivate plants together.

Compassion centers, cultivators, and cooperative cultivations are all subject to licensing and regulatory oversight by the Department of Business Regulation (DBR) Office of Cannabis Regulation, which is also in charge of overseeing medical marijuana plant tagging requirements under the Edward O. Hawkins and Thomas C. Slater Medical Marijuana Act.

Medical Cannabis Dispensary Application Fee and Guidelines

In addition to the registration materials, applicants for a Medical Marijuana Dispensary License must provide:

Compassion center 

  • $10,000 non-refundable application fee
  • $500,000 annual license fee

Cultivator

  • $5000 non-refundable application fee
  • Micro-license, 0 – 2,500 sq. ft., $5,000; Class A, 0 – 5000 sq. ft., $20,000; Class B, 5,001 – 10,000 sq. ft., $35,000; Class C, 10,001 – 15,000 sq. ft., $50,000; Class D, 15,001 – 20,000 sq. ft., $80,000 annual license fees

Cooperative Cultivator

  • $50 non-refundable application fee
  • $500 annual license fee

You may find a thorough list of Rules and Regulations related to the Medical Marijuana Program in Rhode Island here. At this time, however, no new applications for medicinal marijuana business licenses are being accepted.

Recreational Use/Adult Use Dispensary

As stated above, there are currently three initiatives to legalize marijuana for recreational purposes in Rhode Island. Here’s what we know so far:

Senate Bill 568, An Act Relating To Food And Drugs – Cannabis Authorization, Regulation  And Taxation, introduced by McCaffrey and Miller, was passed by the Rhode Island Senate in a 29-9 vote.

  • Adults over the age of 21 would be permitted to purchase and possess up to one ounce of cannabis. They would also be permitted to cultivate up to six plants for their own personal use.
  • To oversee the market and issue business licenses, a Cannabis Control Commission would be established.
  • Retail licenses are limited to one per 20,000 residents in each town. According to some estimates, the commission may license up to 150 businesses.
  • At least one third of all licenses would be reserved for members of impacted

communities.

  • The full text of the bill can be seen here

Article 11 of Gov. McKee’s FY 2022 Budget, Relating To Adult Use Marijuana, contains his proposals to legalize cannabis.

  • Adults 21 years of age or older are permitted to possess and purchase up to one ounce of cannabis flower.
  • Would not establish a new independent commission to regulate the cannabis industry, but rather would delegate that responsibility to the existing Department of Business Regulation’s Office of Cannabis Regulation.
  • A total of 25 marijuana retailers are expected to be licensed each year for the first three years of implementation.
  • Five of the awards would be given to women and minority-owned businesses. 
  • The proposal is available here

A third measure, HB6370 An Act Relating To Food And Drugs — Adult Use Marijuana was also filed by Scott Slater. 

  • Adults over the age of 21 would be permitted to purchase and possess up to one ounce of marijuana.
  • The Department of Business Regulation would be in charge of overseeing the cannabis program.
  • Would license up to 15 recreational stores in the start.
  • Nine licenses would be given to three existing and six prospective medical marijuana dispensaries, five would be for social equity applicants and one would be for a worker-owned cooperative.
  • The bill is available for reading here

As the state’s cannabis program develops, we will keep you updated of all relevant news and legislation affecting the opening of a dispensary in Rhode Island. By subscribing to our Rhode Island Cannabis Mailing List (Below), we will keep you informed of all important news and comments pertaining to Rhode Island Legalization. This includes, but is not limited to, the following:

  • What is the cost of opening a dispensary in Rhode Island?
  • What are the requirements for obtaining a license to operate a marijuana company and opening a dispensary in Rhode Island?
  • What special programs will be offered?
  • And more

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