What is RERACA?
The "Responsible and Equitable Regulation of Adult-Use Cannabis Act" was signed into law by Connecticut's Governor Ned Lamont on June 22, 2021. The RERACA legalizes and regulates adult-use (21 and older) cannabis beginning July 1, 2021.
What is the Department of Consumer Protection (DCP)?
The DCP is responsible for the licensing of cannabis growers, retailers, manufacturers, and delivery services in Connecticut.
WHAT TYPES OF LICENSES ARE AVAILABLE FOR CANNABIS BUSINESSES UNDER THE RERACA?
- Disproportionately Impacted Area Cultivator
- Delivery Service
- Hybrid Retailer
- Food and Beverage
- Product Manufacturer
- Product Packager
WHEN WILL THE LICENSING APPLICATION PERIOD OPEN?
The Department of Consumer Protection will start accepting certain types of cannabis business applications in February 2022. There will be a general lottery and a social equity lottery (with the exception for Disproportionately Impacted Area Cultivator licenses) for the first round of applications. Applications for social equity cultivator licenses located in Disproportionately Impacted Areas (non-lottery) will have a one-time 90-day application period beginning February 3, 2022. For applicants in the social equity lottery for other license types, applications will open on February 3, 2022. For applicants in the general lottery, the application period starts on different dates between February 3, 2022 through March 24, 2022, depending on the license type, and will last for 90 days from the start date. Below lists the dates for when the application period opens for each licensing category:
- Disproportionately Impacted Area Cultivator: February 3, 2022 (non-lottery)
- Retailer: February 3, 2022
- Micro-cultivator: February 10, 2022
- Delivery Service: February 17, 2022
- Hybrid Retailer: February 24, 2022
- Food and Beverage: March 3, 2022
- Product Manufacturer: March 10, 2022
- Product Packager: March 17, 2022
- Transporter: March 24, 2022
WHAT LICENSE TYPES ARE NOT SUBJECT TO THE LOTTERY PROCESS?
There are a few pathways to licensure that are not subject to the lottery process. These include:
- Currently licensed producers converting to an expanded producer license
- Currently licensed dispensary facilities converting to a hybrid retailer license
- Applications for cultivators located in a Disproportionately Impacted Area (DIA) that meet the requirements outlined in Section 149 of Public Act 21-1
- Social Equity Partners
- Equity Joint Ventures
All other applicants must go through the lottery process to be eligible to apply for a provisional license for a cannabis establishment.
HOW MANY LICENSES WILL BE ISSUED FROM THE FIRST ROUND OF APPLICATIONS?
- Retailer: 6 general licenses, 6 Social Equity licenses
- Micro-cultivator: 2 general licenses, 2 Social Equity licenses
- Delivery Service: 5 general licenses, 5 Social Equity licenses
- Hybrid Retailer: 2 general licenses, 2 Social Equity licenses
- Food and Beverage: 5 general licenses, 5 Social Equity licenses
- Product Packager: 3 general licenses, 3 Social Equity licenses
- Product Manufacturer: 3 general licenses, 3 Social Equity licenses
- Transporter: 2 general licenses, 2 Social Equity licenses
CAN A DISPENSARY SELL MEDICAL AND ADULT-USE?
Already licensed medical cannabis dispensaries may apply to be a "hybrid retailer" which would allow them to sell adult-use cannabis by submission of a conversion plan along with payment of a fee.
WHO QUALIFIES AS A SOCIAL EQUITY APPLICANT?
Social equity applicants are defined as those individuals from communities that have been disproportionately harmed by cannabis prohibition and enforcement. To qualify as a social equity applicant, there must be at least 65 percent ownership or control of the business by individuals who meet income and residency requirements for social equity applicants below:
- Had an average household income of less than three times the State median household income over the last 3 tax years; AND
- Was a resident of a disproportionately impacted area for at least 5 of the past 10 years; OR
- Was a resident of a disproportionately impacted area for at least 9 years before the age of 18.
How will the Connecticut cannabis licensing scheme bolster social equity?
RERACA contemplates that half of the cannabis business licenses will go to social equity applicants. Such applicants would be subject to lower licensing fees and receive a fifty percent discount for the first three years of license renewals. They may further receive startup costs coverage, workforce training, and technical assistance. Tax revenues generated from the legalization of cannabis will be reinvested into communities historically impacted by the war on drugs.
How can applicants prepare now for the upcoming adult-use cannabis license application cycle?
The first step in preparing for your cannabis license application is to retain a cannabis business attorney.
Among other things, they will guide you through the steps of securing real estate, obtaining local approvals, developing your security plan, environmental impact plan, and quality control plan.
Why is a cannabis business attorney important?
The lawyers at Leaf Legal, P.C. provide comprehensive and experienced legal counsel to Connecticut cannabis businesses in all aspects from the ground up to make sure clients are able to safely navigate Connecticut's adult-use cannabis program with an in-depth understanding of all integral elements of licensure and running a compliant business.
By understanding the complexities of Connecticut's licensure procedures, the attorneys at Leaf Legal, P.C. are able to diligently guide clients towards establishing state-compliant cannabis businesses. Leaf Legal, P.C. is fully equipped to assist your legal needs in Connecticut's rapidly expanding licensing and regulatory scheme. Contact the attorneys at Leaf Legal, P.C. to request a consultation.