State releases draft rules for medical marijuana, some question fee rates

State regulators rolled out more details for Ohio’s new medical marijuana program Friday, prompting members of a panel advising the process to question the high fees proposed for marijuana business owners.

Under the proposed rules, medical marijuana product manufacturers, called processors, would pay $100,000 a year for one of 40 available licenses. Large-scale marijuana growers would pay $200,000 a year for a cultivator license. And retail dispensaries would pay $80,000 every two years to be licensed.

Members of the Ohio Medical Marijuana Advisory Committee on Friday questioned where the fees go and how much is necessary to operate the program, suggesting state officials release a budget plan for the fees.

“Fees have to cover whatever you want to cover but not anything more,” said committee member Tony Coder, assistant director of Drug-Free Action Alliance. “If you raise the taxes, patients are just going to go back to a dealer who is not doing this scrupulously.”

Application and license fees were intended to cover the cost to run and enforce the program out of the Ohio Department of Commerce and State Pharmacy Board.

Those agencies essentially borrowed $1.8 million from the state last year to hire staff to work on rules and regulations for the program. Repayment will come from marijuana business application and license fees.

Ohio State Board of Pharmacy officials said Friday they intend to lower the fees for dispensaries but haven’t yet settled on an amount.

Shelby County Sheriff John Lenhart said the fees should remain high to ensure law enforcement costs associated with the new law are covered.

Chris Lindsey, senior legislative counsel for pro-marijuana group Marijuana Policy Project, said the proposed processor fees seemed high; many other states combine cultivator and processor licenses. For example, Illinois charges cultivators, which also make marijuana products, an initial $200,000 license fee.

Overall, Lindsey said, it seems Ohio regulators are not throwing up roadblocks to the program and have been receptive.

“You never get the perfect rules,” Lindsey said. “But I’ve seen places where when these laws are passed, they end up in the hands of regulators and all of a sudden all these barriers seem to pop up and that doesn’t seem to be happening in Ohio.”

To read the draft rules, click here.

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