Final summer season, I wrote about Senate Bill 1459, a piece of California legislation that made a new scheme of provisional licenses for cannabis operators. This provisional licensing scheme was primarily intended to replace the short-term licensing scheme that only ran via January 1, 2019 per state law. SB-1459 was essential mainly because the 3 major state cannabis licensing agencies—the Bureau of Cannabis Manage (“BCC”), California Division of Public Well being (“CDPH”), and California Division of Meals and Agriculture (“CDFA”)—and localities which challenge permits to cannabis operators, have been all backlogged with many applications and couldn’t approach all of the applications in time for applicants to get operational in 2018. In some instances, applicants could not even acquire short-term licenses just before the short-term license regime expired.
SB-1459 was hence supposed to be a lifeline for corporations which had scored quite brief-lived short-term licenses so that they could get operational in 2019 whilst the state was processing their annual licenses. In this post, I appear at what’s occurred with the provisional licensing scheme considering that SB-1459 has passed, how every single agency has treated them, and what applicants need to have to do to get them.
The steps—per SB-1459—to acquire a provisional license are relatively simple at 1st glance: (1) an applicant need to hold or previously have held a short-term license for the similar industrial cannabis activity for which it seeks a provisional, and (two) the applicant need to submit a completed annual license application and proof that California Environmental High quality Act (“CEQA”) compliance is underway. Provisionals final for 12 months and can be issued via the finish of 2019. Fortunately for operators, this does not add a layer of complication to the currently complicated approach of applying for annual licenses and does not definitely call for applicants to do a lot that they wouldn’t have currently necessary to do in connection with annual applications.
The only agency which has published much more complete information and facts on provisional licenses is the CDFA, which regulates cultivators. The CDFA does not have a separate application for provisional licenses. Per its directions, when an applicant submits an annual license application (and assuming it held a short-term and paid its costs), CDFA employees will identify irrespective of whether a provisional is warranted.
As noted above, and as most readers of this weblog are possibly conscious, the short-term license scheme ended in late 2018. The effect of this is that short-term applications will expire in March or April unless an extension was offered. Every single of the 3 agencies is most likely to get a substantial influx of applications involving now and when the short-term licenses expire, but we do not however know how they will approach provisionals. If the BCC and CDPH adhere to the CDFA’s lead, then it appears like it may perhaps be a ministerial act just after critique of the completed submissions. But even that requires time to do, and firms that are at present legally operational should really possibly not wait till their cutoff to apply for annuals, as a provisional application possibly would not be processed by that time.
The bottom line for provisional license applicants is that even even though they do not have quite a few filing prerequisites, they are going to be hard to acquire mainly because applicants need to have 1st applied for annuals. Qualifying applicants—those who hold or have held short-term licenses—should take a really hard appear at the short-term license expiration dates and seek the advice of with their cannabis counsel on finishing up annuals with time for the agencies to critique annual applications, and hopefully approach and challenge provisionals. Remain tuned to the Canna Law Weblog for any other developments with provisionals.