Delaware Bill Would Allow Medical Cannabis Operators To Sell Adult-Use Cannabis

In preparation for Delaware’s launch of adult-use sales, this new bill would permit medical cannabis business owners to apply for a temporary conversion license to sell adult-use cannabis as well.

In Delaware, a new bill is being proposed to allow medical cannabis businesses to also sell adult-use cannabis once the state’s adult-use sales begin.

House Bill 408 was recently introduced on May 16 by sponsors Rep. Ed Osienski and Sen. Trey Paradee. Delaware’s Marijuana Control Act was enacted on April 27, 2023 without the signature of Gov. John Carney, and went into effect starting on August 1, 2023. It created four different license types but none of which currently permit medical cannabis compassion centers to take part in the upcoming launch of adult-use sales. If passed, HB-408 would create a temporary conversion license that medical cannabis businesses can apply for in order to sell adult-use cannabis, and if the application is approved, the license would expire after four years have passed, and can then be renewed again.

“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,” Osienski said in a press release. “Our 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, empowering them to kickstart their ventures.”

According to HB-408, the medical cannabis business must currently be eligible for renewal within the medical program, must be able to show that it can meet market demands (in addition to verify its plans for continued service in medical cannabis and show support for the social equity program), and have a signed labor peace agreement with a labor organization. Applicants must also pay the fee for a conversion license, which is currently set at $100,000 per license. The proceeds from the fee will be used to give financial assistance to conditional license holders who are also social equity applicants.

“For us, passing the Marijuana Control Act was always about our desire to replace an illegal market that has overwhelmed our court system and damaged lives with a legal, regulated and responsible industry that will create thousands of good-paying jobs in Delaware,” Paradee said. “We also need to protect the jobs created by our compassion centers, who have already put in the hard work of standing up an industry and have the capacity and infrastructure to meet demand on Day 1.” Paradee added that providing an avenue for medical cannabis businesses to participate in the adult-use market will aid communities harmed by the War on Drugs.

If HB-408 became law, it would require that the Delaware Office of the Marijuana Commissioner open up applications between August 1-November 1, 2024. For now, it heads to the House Economic Development/Banking/Insurance and Commerce Committee.

Earlier this year, Osienski introduced another bill, House Bill 285, which aims to expand the Delaware medical cannabis program. Medical cannabis was first legalized in Delaware in 2011 but sales didn’t begin until 2015 when the first dispensary began operation.

If passed, HB-285 would allow senior citizens to become medical cannabis patients, permit healthcare providers to determine whether or not medical cannabis could be useful for a patient, and improve the cannabis registry ID card process. “With the full legalization of adult-use recreational marijuana last year, my colleagues and I agreed that our medical marijuana law needed to be updated to help the people who rely on those products get the therapy they need,” said Sen. Kyra Hoffner, according to WBOC. “These changes will allow healthcare providers to make sound decisions about which treatments best fit their patients, and make those treatments more readily accessible to people who need them the most. I want to thank my colleagues in the General Assembly for continuing to support a responsible and reasoned approach to both recreational and medical marijuana in the First State.”

HB-285 is currently waiting on Gov. Carney’s desk for a signature or veto.

In April, Osienski and Paradee, in addition to state treasurer Colleen Davis, filed House Bill 355, which would implement state protections for banks who seek to serve licensed cannabis businesses.  This would apply to banks as well as “credit unions, armored car services, and providers of accounting services” which wouldn’t be subject to prosecution under Delaware state law. “This is really a public safety issue,” said Paradee last month. “We do not want any of the current medical cannabis providers or the coming recreational cannabis providers to struggle with that issue.”

While these bills await their respective approvals, many eagerly await the news of when adult-use cannabis sales will begin. While an official date has not yet been verified, the most recent launch estimate is currently looking toward March 2025, according to Delaware Marijuana Commissioner Robert Coupe told the Joint Finance Committee in February.

In the meantime, a slew of other bills recently headed to Gov. Carney’s desk for approval, such as House Substitute 1 for House Bill 162, which would legalize human composting. If approved, it would allow licensed morticians to care for the deceased as they decompose by mixing the bodies with wood chips, straw, and other organic materials. After fully decomposed (estimated to take approximately 30 days), the compost would be returned to the family to use as they see fit.

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