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How To Open a Dispensary in Kentucky

Overview

Are you wondering how to open a dispensary in Kentucky? This page will provide you with the most recent news and information that is important to starting a cannabis company in the state of Kentucky. This contains insightful considerations about what is ahead in the future.

Kentucky became the 38th U.S. state to legalize medicinal marijuana on March 31, 2023, when Governor Andy Beshear signed Senate Bill 47 into law. Patients suffering from certain medical problems will be permitted to use cannabis as a therapy option under the suggestion of a physician or advanced nurse practitioner.

The Kentucky Center for Cannabis will assess which ailments qualify for medicinal marijuana usage. There will be license options available for growers, manufacturers, processors, testing laboratories, and retailers under the new law. Nevertheless, the specific rules and regulations will not be established until at least January 1, 2024, and the legislation will not go into force until January 1, 2025.

On October 5th, 2023, Kentucky Governor Andy Beshear announced the launch of a new government website, kymedcan.ky.gov, to enable people to track the progress of the state’s upcoming medical marijuana program, slated for implementation in 2025. Additionally, Governor Beshear announced the formation of a 12-member “Team Kentucky Medical Cannabis Workgroup”. This workgroup will analyze developments in cannabis policy within the state and across the nation, with representatives from various sectors such as law enforcement, agriculture, healthcare, and more. Their goal is to provide recommendations to ensure safe access to medical cannabis for Kentuckians.

On January 2nd, 2024, Kentucky made a significant move in advancing towards a more liberal marijuana policy. A new bill, HB 72, introduced by Rep. Nima Kulkarni (D), proposes to legalize the use, possession, and home cultivation of recreational marijuana for adults aged 21 and over. This groundbreaking legislation, however, stops short of legalizing commercial sales. It aims to end all penalties, including arrest, for simple possession and use of marijuana. Adults would be allowed to grow a small number of cannabis plants at home for personal use, aligning with the state’s efforts to implement a medical cannabis policy. 

On January 30th, 2024, Kentucky unveiled its legislative proposal for cannabis legalization. Through the introduction of House Bill 420, Kentucky proposed to legalize and regulate cannabis for adults aged 21 and over, setting a standard for cannabis reform in the state. Since the bill’s introduction, there has been a noticeable increase in public interest and support, with stakeholders eagerly monitoring the bill’s progress through the GOP-dominated legislature. This legislative move seeks to authorize various cannabis-related businesses, including cultivation, processing, and retail and introduces a taxation framework aimed at strengthening the state’s economy. The proposal is designed to address social equity by providing for record sealing opportunities and establishing a Social Impact Council to fund educational and community initiatives.

The Opportunity Size

Kentucky has the potential to generate significant revenue by regulating the sale and distribution of legalized marijuana. According to estimates, the state could make tens of millions of dollars in tax revenue without raising taxes. This revenue could fund various public services and infrastructure projects, such as pensions, road construction, and education.

In addition to generating revenue, legalizing marijuana could also lead to significant cost savings for the state. Criminalizing simple possession of marijuana currently requires law enforcement resources and incurs legal costs. By legalizing marijuana, Kentucky could save millions in law enforcement costs and redirect those resources toward other priorities.

Local Cannabis Restrictions & Laws

In 2019, Jefferson County and Louisville in Kentucky passed decriminalization measures for low-level marijuana possession. In Jefferson County, possession of up to one ounce of marijuana is now punishable by no criminal prosecution when it is the only primary charge. In Louisville, possession of up to one-half ounce of marijuana is now the lowest law enforcement priority.

Local governments in Kentucky can opt out of allowing cannabis businesses to operate within their jurisdictions under Senate Bill 47. If citizens wish to have their municipalities opt back in, they can petition for it. Additionally, local governments can regulate the time, place, and manner of cannabis businesses as long as they do not impose an undue burden on those businesses.

Medical Marijuana 

From January 1, 2025, patients in Kentucky with a recommendation from a doctor or advanced nurse practitioner can use medical marijuana for conditions such as cancer, severe pain, epilepsy, multiple sclerosis, muscle spasms or spasticity, chronic nausea or cyclical vomiting, post-traumatic stress disorder or any other medical condition or disease that the Kentucky Center for Cannabis deems appropriate.

The standard forms of medical marijuana, such as edibles, oils, tinctures, and capsules, will be available to patients, but smoking raw cannabis flower is not allowed. Instead, patients can purchase cannabis flowers for vaporization purposes.

Medical Marijuana Program Opportunities

The Kentucky Cabinet for Health and Family Services is responsible for establishing regulations for the program and issuing business licenses under Senate Bill 47, and the final policies and regulations must be completed by July 1, 2024.

An application for a cannabis business license may be denied by regulators for any reason that the cabinet, in the exercise of sound judgment, considers adequate. In such a case, the applicant has the right to seek and participate in an administrative hearing.

The applications for cannabis licenses are not currently available at this time. As new information becomes available, we will be sure to update this area.

Cannabis License Types

The state of Kentucky offers licenses for various types of medical cannabis businesses, including dispensaries, cannabis processors, cannabis producers (holding both cultivator and processor licenses), cannabis safety compliance facilities (testing labs), and cannabis cultivators in four tiers based on the size of the cultivation area. There is no numerical limit on the number of licenses available for any of these types of businesses.

How Much Does It Cost to Open a Dispensary in Kentucky?

As of now, the licensing fees for opening a dispensary in Kentucky are yet to be determined by the state authorities. It’s unclear how much it will cost to obtain a license to operate a medical cannabis dispensary in the state. We will update this section once information is available.

However, it’s important to note that opening a dispensary in any state requires significant financial investment beyond just the licensing fees. There are several other costs associated with setting up and operating a dispensary, including:

  • Real estate and rent expenses
  • Security systems and staffing
  • Inventory and product costs
  • Marketing and advertising expenses
  • Legal and accounting fees

If you are looking for further information regarding the costs involved in opening a dispensary, we recommend referring to our comprehensive guide on the subject.

Recreational Use Legalization

Currently, possessing up to eight ounces of marijuana is classified as a misdemeanor under state law, punishable by up to 45 days imprisonment and a fine of $250 in Kentucky. 

Kentucky lawmakers introduced various bills to legalize cannabis, but none of them progressed before the legislative deadlines. Despite facing setbacks, proponents of legalizing recreational use of marijuana in Kentucky remain optimistic about the future. The push for medical marijuana may ultimately pave the way for the legalization of recreational marijuana.

Final Thoughts

Over the next few weeks and throughout 2024, there will be numerous developments that will impact the pace of progress, the prerequisites for establishing a marijuana dispensary, and the timeline for accepting license applications in Kentucky. To stay informed on all significant updates and access hard-to-find news and commentary related to Kentucky Legalization, please subscribe to our Kentucky Cannabis Mailing List. This will cover various topics, such as:

  • What are the requirements to get a marijuana business license in Kentucky?
  • How do I open a medical dispensary in Kentucky?
  • When will Kentucky fully legalize cannabis?
  • What special programs will be available?
  • And more

Just fill out the information below to get access.

 

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