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Delaware’s Medical Cannabis Businesses May Soon Sell Adult-Use Cannabis Too
In a move that could shake up the state’s cannabis industry, a new bill has been proposed in Delaware to allow medical cannabis businesses to also sell adult-use cannabis once the state’s adult-use sales begin. House Bill 408, introduced on May 16 by Rep. Ed Osienski and Sen. Trey Paradee, could pave the way for a more diverse and successful cannabis market in the state.
Delaware’s Marijuana Control Act: A Brief History
Delaware’s Marijuana Control Act was enacted on April 27, 2023 without the signature of Gov. John Carney. It went into effect on August 1, 2023 and created four different license types. However, none of these licenses currently permit medical cannabis compassion centers to participate in the upcoming launch of adult-use sales.
Temporary Conversion License: A Game-Changer for Medical Cannabis Businesses
If passed, HB-408 would create a temporary conversion license that medical cannabis businesses can apply for in order to sell adult-use cannabis. This license would expire after four years, but can be renewed again. This could be a major opportunity for medical cannabis businesses to expand their offerings and tap into the growing adult-use market.
Supporting Social Equity and Empowering New Retailers
Rep. Osienski stated in a press release, “As Delaware moves closer to the launch of recreational marijuana sales, it’s important that we continue exploring and implementing policies that will bolster the program’s success and support both new and existing retailers.” He believes that the experienced compassion centers are well-equipped to navigate this transition and the funds generated from their conversion license fees will serve as a vital funding source for social equity applicants.
Requirements for a Conversion License
According to HB-408, in order to be eligible for a conversion license, the medical cannabis business must be able to meet market demands, have a plan for continued service in the medical cannabis program, and show support for the social equity program. They must also have a signed labor peace agreement with a labor organization and pay a fee of $100,000 per license. The proceeds from this fee will be used to provide financial assistance to conditional license holders who are also social equity applicants.
Protecting Jobs and Communities
Sen. Paradee, one of the sponsors of the bill, believes that passing the Marijuana Control Act was always about replacing the illegal market with a legal, regulated, and responsible industry that will create thousands of jobs in Delaware. He also emphasized the need to protect the jobs created by compassion centers and their capacity to meet demand on Day 1. He believes that allowing medical cannabis businesses to participate in the adult-use market will also aid communities harmed by the War on Drugs.
What’s Next for HB-408?
If HB-408 becomes law, the Delaware Office of the Marijuana Commissioner will open up applications for conversion licenses between August 1 and November 1, 2024. For now, the bill heads to the House Economic Development/Banking/Insurance and Commerce Committee for further consideration.
Expanding the Medical Cannabis Program
Earlier this year, Rep. Osienski introduced another bill, House Bill 285, which aims to expand the Delaware medical cannabis program. This shows a continued effort to improve and evolve the state’s cannabis industry for the benefit of all stakeholders. Stay tuned for updates on the progress of these bills and their potential impact on Delaware’s cannabis market.
