Are you wondering how to open a cannabis dispensary in Connecticut? This page is dedicated to keeping you up to date on the latest news and information relevant to opening a cannabis business in Connecticut. This includes helpful insight on what is to come next for the state.
On June 17, 2021, the 50th Anniversary of War on Drugs, the state legislature approved a 300-page bill to legalize and regulate cannabis in Connecticut. The bill took effect on July 1, 2021, with Gov. Ned Lamont’s signature.
Recent findings support this legislation. In a survey from Sacred Heart University in Fairfield, 64 percent of Connecticut voters favored cannabis legalization. Meanwhile, another study indicated that cannabis legalization and regularization would lessen the pandemic’s negative impact on Connecticut’s economy in terms of employment and tax revenue.
As it relates to Connecticut Dispensaries:
The Department of Consumer Protection (DCP) oversees the cannabis program and announced regulations for Adult-Use Cannabis on October 1, 2021. The effective date for the regulations is the 16th of October, 2021. The regulations define the parameters by which cannabis business licensees must operate. These rules and procedures protect consumers by ensuring product quality, safeguarding minors, and preventing product diversion.
In February 2022, the DCP started accepting applications for certain adult-use cannabis business licenses. Additionally, the Department is releasing the number of first lottery round licenses available for each cannabis business type. The lottery application rounds were staggered, with the first round being open for 90 days.
On July 12th, 2022, a state panel also took steps to begin issuing the first cannabis cultivator licenses by accepting 16 applications as having satisfied social equity standards.
On September 22nd, 2022, Connecticut announced the six cannabis retailers that have met the requirements for social equity status and, pending additional approval and payment of license costs, will be among the first to sell adult-use recreational cannabis in the state. Two micro-cultivator applicants have been selected as well as having received equity status to advance in the licensing procedure.
On October 28th, 2022, the Connecticut Department of Consumer Protection began the next steps in the license application evaluation for the cannabis product manufacturer and transporter license categories chosen via the Social Equity Lottery. The Social Equality Council accepted three product manufacturers’ and two transporters’ applications for satisfying General Assembly social equity standards. The number of applications received is equal to the total number of Social Equity Licenses available for manufacturers and transporters in the first drawing. In subsequent lotteries, more licenses will be made accessible.
The Department of Consumer Protection has made the next phase of reviewing license applications available to those who were successful in the lottery for the remaining licenses. Each and every lottery license type has been chosen. The next lottery’s details will be released by the Department of Consumer Protection in 2023.
On January 10th, 2023, the first legal pot retailers in Connecticut opened their doors for customers over the age of 21. Nine dispensaries transitioned to become hybrid dispensaries and offer recreational products. Licensed hybrid merchants are allowed to begin selling cannabis products to people over the age of 21 beginning at 10 o’clock in the morning.
As of April 20th, 2023, Connecticut officials confirmed there will be no more cannabis business lotteries until June 7th, the end of the legislative session. The state legislature is considering pieces of legislation that could alter how cannabis license lotteries are run, including lotteries for cannabis retail and cultivation. Lawmakers are concerned about saturating the market and are considering limiting the number of times a single applicant can enter the lottery to ensure fairness and transparency. Currently, there are no clear plans for future lotteries yet.
On June 12th, 2023, Connecticut Governor Ned Lamont approved a budget plan that helps licensed marijuana businesses save on taxes. These businesses are currently unable to claim federal deductions due to a code called 280E by the IRS. By providing a state-level workaround for this code, the governor’s office expects the marijuana industry to receive $4.7 million in tax relief in 2024.
Starting July 1st, 2023, adults who are 21 years old and above in Connecticut are legally allowed to grow their own marijuana plants for personal use. This permission comes from a law called SB 1201, which was signed by Governor Ned Lamont in 2021 as part of the broader legalization effort. Initially, only medical cannabis patients were allowed to grow their own plants starting from October 2021, but now all adults over the age of 21 can exercise this right.
On August 29, 2023, Connecticut’s Social Equity Council (SEC) and Department of Economic and Community Development launched the Canna-Business Revolving Loan Fund. It offers financial aid to licensed social equity cannabis businesses in Connecticut, with a streamlined application process. The program supports rehabilitating or developing unused real estate for cannabis use, with fixed-rate loans at prime plus 3%. Participants in the SEC accelerator program receive a 1.50% interest rate discount.
Numbers from Statistica.com project that marijuana sales in Connecticut will reach about 160.3 million U.S. dollars by 2025. With a population size projected to reach approximately 3.55 million in 2021, it’s evident the state will be a hot market to start a cannabis business.
The legalization of marijuana in the state will have significant effects on its projected tax revenue. A fiscal analysis pegs the state’s projected tax revenue at $15.7 million come 2023 and around $60 million the following year. Come 2026, legalization will reportedly generate an additional $29 to $55 million in income taxes, depending on the chosen tax structure and whether Connecticut spends or saves the revenue.
As medical marijuana and recreational rules start to change in a state, it is very common for towns and municipalities to have their own rules for what is allowed and what is not. It is expected that some communities will strongly support the state legislation, others will demonstrate not-so-strong support, and others will outright disagree with the state’s decision.
Connecticut’s new recreational marijuana bill has this to say about local restrictions and laws:
In this section, we will keep you updated on all the relevant changes in the 169 towns of Connecticut in terms of their stances, restrictions, or outright bans pertinent to recreational cannabis.
On June 1, 2012, the state legalized medical marijuana in Connecticut by enacting House Bill 5389. When Gov. Dannel Malloy signed HB 5389, Connecticut became the 17th state to enact an effective medical marijuana law.
Designed to allow truly sick patients easier, legal access to medical marijuana, the program protects both patients and caregivers from arrest and prosecution, provided they (1) have a valid registration card and (2) obtained the medical marijuana from the patient’s registered dispensary.
The law prohibits any person from representing or acting as a licensed dispensary without a license from the Commissioner of Consumer Protection. The Commissioner shall determine the necessary number of dispensaries needed in the state and the requirements for obtaining a license.
Initially, the law did not allow minors to participate in the program. However, when Gov. Malloy signed HB 5450 on May 17, 2016, young patients were allowed to qualify for certain types of medical marijuana. This began in October 2016. Additionally, the department expanded the program with six new conditions. Generally, Connecticut residents with cancer, glaucoma, HIV/AIDS, Parkinson’s disease, multiple sclerosis, and more can qualify for medical cannabis.
Since its inception, the number of registered patients in Connecticut has grown to 51,036 since July 17, 2022. However, no new license applications for medicinal marijuana are being accepted at this time.
Alongside the registration materials, applicants for a Medical Marijuana Dispensary License must submit a non-refundable, non-transferable initial fee of $100. There is also an annual renewal fee of $100.
Meanwhile, applying for a Medical Marijuana Dispensary Facility License comes with an initial application fee of $1,000, a registration fee of $5,000, and a renewal fee of $5,000, all of which are non-refundable.
You can check here for a comprehensive list of guidelines on starting a Medicinal Marijuana Business in Connecticut.
As stated above, Connecticut’s S.B. 1201 — An Act Concerning Responsible and Equitable Regulation of Adult-Use Cannabis was signed into law, making Connecticut the 18th state to legalize adult-use cannabis. The bill can be viewed here.
The Department of Consumer Protection, which initially only managed the medical marijuana program, is also appointed to regulate adult-use cannabis in Connecticut.
Nine types of licenses will be available: retailer, hybrid retailer, cultivator, micro-cultivator, product manufacturer, food and beverage manufacturer, product packager, delivery service, and transporter. It is planned that 50% of each type of license is reserved for social equity applicants.
Here is what we know regarding the requirements to open a dispensary in Connecticut.
You may apply for a cannabis license as early as February 3, 2022. Here is the initial application window for each license type:
No deadline exists for conversion requests or equity joint ventures. All the other applications will be open for 90 days. Each license category will have two lotteries: one for social equality and one for general. DCP will conduct the general lottery after selecting the social equity applicants through the lottery. Applicants approved for social equity, and general lottery winners may apply for a provisional license. While applicants for most types of licenses will be put into a lottery, applicants for certain business licenses do not have to go through the lottery procedure.
When applying for a license to run a cannabis business, applicants are encouraged to send in the most complete and detailed application. Application submission should not be rushed, as there is no advantage to doing so early. Applications can be found at elicense.ct.gov. You may find more information on the requirements for each license type at ct.gov/cannabis.
Marijuana legalization in Connecticut will mean a high growth potential. The maturation of the marijuana market in Connecticut is expected to generate new jobs, spark GDP growth, and create hundreds of millions in new annual tax revenues. Legalization is also expected to curb the growth of the black market, protecting customers and the general public and cutting economic losses from residents crossing the border.
As the state expands its cannabis program, particularly the recreational program, we will keep you up-to-date on all relevant news and legislation on opening a dispensary in Connecticut. By adding yourself to our Connecticut Cannabis Mailing List (below), we will keep you updated on all relevant news that matters, and not so easy to find news and comments based on Connecticut Legalization below. This includes but is not limited to:
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