WARWICK
– The R.I. Cannabis Control Commission on Wednesday released its long-awaited draft rules and regulations governing the state’s adult-use cannabis industry.
The unanimous vote Wednesday morning started a minimum 30-day public comment period. The
rules and regulations run about 200 pages and include new packaging and labeling requirements, a hybrid randomized selection process for licensing, updated quality assurance testing and details on the Social Equity Assistance Program.
State law allows the commission to initially grant 24 new retail recreational licenses, half of which are reserved for social-equity licenses and worker-owned cooperatives. There will be four licenses available in each of six geographic zones across the state. Under state law, more licenses could eventually be approved.
Licensing will work under a “hybrid” model, whereby applicants must first be vetted and approved before being selected to enter a lottery that will be held in each of six designated geographic zones.
Before the vote, Kimberly Ahern, chair of the Cannabis Control Commission, noted the push among some cultivators to fast track a portion of the nonsocial-equity retail licenses to help increase their customer base.
“We didn’t do that,” said Ahern. “It wasn’t the right thing to do.”
Regular applicants will have to pay a $7,500 fee and if awarded, $30,000 a year for annual licenses. The first six social-equity licenses the state awards will have both the initial application fee as well as the annual $30,000 retail license fee waived for the first year but must pay $7,500 to reestablish the retail license in the second year, $15,000 in year three, $ 22,000 in year four and $30,000 in year five and every subsequent year.
Though he voted to approve the draft rules, commissioner Robert Jacquard reiterated his opposition to a hybrid system, arguing instead for a merit-based process.
“Some applicants will have better business plans than others. But we won’t be able to consider which applicants have better plans,” he said. “I think that is unfair to the applicants that put the most effort into this.”
Once the application period opens, the commission will begin a review of all applications and notify qualified applicants before publicly announcing the date of the lottery in each of the zones. The lottery will include a random drawing “held in a manner that can be observed by the public,” according to the draft.
But when the new licenses will be awarded is uncertain. During the meeting Ahern said the number of applications will determine the timeline.
“We do not know how many applications [we will receive] until we open the application period,” she said.
On Wednesday Matthew Touchette, spokesperson for the commission, declined to speculate on a timeline, saying that the commission will follow the 30-day period mandated by the state’s Administrative Procedures Act and “aims for this to be an engaging and efficient process.”
Karen Ballou, chief financial officer at West Warwick-based cultivator CultivatingRI, said at first glance the cultivators aren’t happy with what they see.
Five hours after they were posted to the commission’s website, Ballou, who also served as president of the now-defunct Rhode Island Cannabis Association, was still sifting through the documents. She said it appears much of what the cultivators had lobbied for over the previous year failed to make it to the draft, such as a lowering of annual fees and finding a better balance between the number of businesses growing cannabis and the amount of dispensaries they can sell to.
The commission will host a public hearing on Jan 24. It can still amend the proposed rules and regulations before final adoption.
(SUBS 15th paragraph to correct that association is no longer active.)
Christopher Allen is a PBN staff writer. You may contact him at Allen@pbn.com.
