WARWICK – The R.I. Cannabis Control Commission has approved its long-awaited draft rules and regulations governing the state’s adult-use industry.
Effective May 1, the approval of the regulations marks a major step in the implementation of the Rhode Island Cannabis Act and paves the way for the awarding of 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, with retail licensing under a hybrid selection model that includes an initial screening process followed by a randomized lottery.
Following the vote on April 10, the panel submitted the regulations to the R.I Secretary of State’s Office. Commission Chair Kimberly Ahern said the new rules, which received almost 400 public comments over a 30-day period, “prioritize safety, industry compliance, and the voices of communities that have been historically harmed by cannabis prohibition.”
Set to assume full authority from the R.I. Department of Business Regulation over licensing and enforcement of the state’s adult-use and medical cannabis programs, the Office of Cannabis Regulation, led by Administrator Michelle Reddish, will oversee day-to-day operations of the industry.
“Building on a strong foundation, the office is committed to continuous improvement toward operational efficiency, regulatory integrity, and public health as we ensure our strategic direction evolves with the industry,” said Reddish.
The approved rules state that after the commission completes its review of all applications it will notify qualified applicants and publicly announce “the date, time, and manner” of randomly selecting qualified applicants for approval in each available zone.
Applicants will have to pay a $7,500 fee and, if awarded, $30,000 a year for annual licenses. However, 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.
The law also created a social equity fund to assist with startup costs and other operational expenses.
Current Social Equity provisions requires at least 51% ownership and control be individuals directly impacted by past cannabis laws or economic disparities.
The commission incorporated certain changes to licensing and compliance rules, based on the public comment, including a prohibition on pooled investor control of multiple licenses; removing personal data from cannabis establishment employee ID cards; standardizing cultivator fees at $2 per square foot with a 10% discount on microculitvators; and provisions aimed at streamlining certification of social equity applicants.
Tweaks to operational requirements extended the timeline to comply with product labeling rules to 180 days; expanding delivery service to non-residential locations; and increasing product testing batch size from 10 pounds to 15 pounds.
Cannabis Commission spokesperson Charon Rose said Monday the panel anticipates that a timeline for the rollout of license applications will be shared during a future meeting, followed by “a formal announcement once that timeline has been finalized.”
Adult use and medical retail sales are projected to reach $122 million this fiscal year, with recreational sales hitting $206 million by fiscal 2027, according to OCR.
Christopher Allen is a PBN staff writer. You may contact him at Allen@PBN.com.
