As of June 1, the Oklahoma Medical Marijuana Authority (OMMA) has implemented a tiered licensing structure that significantly impacts new and existing license holders. Here is how this new tiered licensing in Oklahoma can affect your business.
The Foundation of HB 2179
While the constitutionality of HB 2179 has been questioned, it is currently in effect despite legal challenges. This bill is bringing changes for commercial marijuana business holders by imposing new requirements and increasing annual renewal fees.
Structure of Tiered Licensing
Understanding the pricing structure under HB 2179 can help avoid any unexpected fees during renewal applications. The pricing structure claims to promote fairness in fee calculations for each OMMA license category. This new pricing structure includes the following:
Commercial Cultivators
In the past, a single grow license covered all types of cultivation – indoor, outdoor, or greenhouse. However, cultivators must choose between indoor and outdoor growth and obtain a separate license for each method.
The initial and recurring licensing fees are determined based on the anticipated canopy square footage or acres harvested, transferred, or sold annually. The fees range from $2,500 to $50,000 or more, depending on the operational scale of the cultivator.
Commercial Processors
The fee structure for commercial processors follows a tiered model similar to that of cultivators. Their fees are based on factors like biomass or concentrate yield. According to OMMA, non-liquid concentrates are equivalent to one liter per 1,000 grams. The fees for commercial processors range from $2,500 to $20,000, depending on the tier.
Dispensaries and Labs
Dispensaries charge an entry fee of $2,500; their renewal fees are linked to 10% of the total sales and medical marijuana excise taxes. Annual dispensary fees range from $2,500 to $10,000.
On the other hand, medical marijuana labs face a significant increase in their license fee, which will rise from $2,500 to $20,452.05 after service charges are applied. This higher fee applies to all lab businesses, regardless of their volume.
Adopting Tiered Licensing
Implementing the tiered licensing model depends on the renewal window of the license. Renewals before June 1, 2023, will not be subject to the tiered framework. However, renewals after June 1 will follow the new structure, regardless of whether OMMA’s tiered licensing has been introduced on June 7.
Legal Contest and Potential Resolutions
The contentious nature of HB 2179 is under the spotlight due to a recent lawsuit challenging its constitutionality. The lawsuit contends that the bill masks a revenue-raising tax as a fee, causing concerns for licensees who are already affected by the fee hikes. This considerable fee escalation for certain businesses could affect their viability in the current Oklahoma marketplace.
Learn More About Tiered Licensing in Oklahoma
The tiered licensing system introduced by OMMA through HB 2179 is a game-changer for Oklahoma’s medical marijuana industry. With legal scrutiny looming, license holders must adapt to the new regulations and adhere to compliance measures.
For those struggling with the complexities of license renewals, you will want to seek legal advice from the professionals at Brune Law Firm. Contact us or call (918)372-3021 to schedule a consultation.