How to Open a Dispensary in Rhode Island (The 2022 Guide)

Overview

Are you interested in learning more about how to open a dispensary in Rhode Island? On this page, we will keep you up to date on the most recent news and information pertaining to starting a cannabis business in Rhode Island. This page contains valuable insights about what is to come in the following few months.

For the first time, a chamber of the General Assembly has voted in favor of recreational marijuana. The Rhode Island Senate approved a Senate Bill 568 introduced in March by Senate Majority Leader Michael McCaffrey and Health & Human Services Chairman Joshua Miller to legalize recreational marijuana use for adults.

On top of the bill filed by Sen. McCaffrey and Sen. Miller, two bills were also filed. In May 2021, on the House side, rep. Scott Slater also filed a legalization measure. On January 20, 2022, Gov. Dan McKee (D), published his budget proposal for the fiscal year 2023. A proposal to legalize marijuana has been included in his yearly budget plan once again, and this time he has incorporated additional wording to allow for automatic cannabis expungements. 

On March 1st, a comprehensive bill to legalize recreational cannabis, establish a regulatory system, and address societal injustices was introduced by Sen. Joshua Miller and Rep. Scott A. Slater.  A total of 33 retail licenses will be allocated in six zones around the state under the legislation (2022-S 2430, 2022-H 7593), including nine compassion centers that might possibly operate as both recreational and medical retailers. 

On May 18th, legislative committees will vote on the legislation (2022-S 2430, 2022-H 7593) to legalize the adult use of marijuana. 

The Opportunity Size

According to Gov. McKee’s fiscal analysis, Rhode Island could generate marijuana tax revenue of $1.7 million in the fiscal year of 2022 and grow to $16.9 million by 2023.

Numbers from Statistica.com show that marijuana sales in Rhode Island will reach approximately 167.6 million U.S. dollars by 2025. With a population size expected to reach about 1.1 million in 2021, it’s apparent the state will be a great market to start a cannabis business.

Local Cannabis Restrictions & Laws

Rhode Island is one of the states in the U.S. to have completely legalized medical marijuana since 2011, but there are still many inconsistencies in the law across the state. Some cities and towns have dealt with the issue differently because this is at its heart a land-use problem. Since this legalization is not specifically mentioned in state zoning law, some municipalities do not permit it anywhere. Others enable it only under particular conditions, such as requiring a special use permit in certain circumstances.

The Rhode Island League of Cities and Towns released a statement in April 2021 about proposals for adult-use marijuana legalization. According to the group, cities and municipalities should be able to opt out through their local councils instead of a ballot referendum.

If recreational marijuana is legalized this year, Newport City recently expressed a desire to have the authority to prohibit adult-use marijuana sales in the city. Meanwhile, Middletown is prepared to take steps to prevent marijuana dispensary sales. The Middletown Town Council would ban compassion centers and retail marijuana stores while allowing cultivation centers and testing providers in some areas of town. It will also enable caretakers and patients to grow cannabis.

In this section, we’ll keep you up to date on all important changes in Rhode Island’s 39 municipalities, including their respective positions, limits, and outright prohibitions on recreational cannabis.

Medical Marijuana

In 2006, Rhode Island became the eleventh state to legalize medical marijuana. The Edward O. Hawkins and Thomas C. Slater Medical Marijuana Act were passed in 2005, with a 52-10 vote in the state House and a 33-1 vote in the state Senate. In-state patients possessing a Rhode Island registry ID card can consume, possess, and cultivate cannabis. Registered patients are allowed to possess up to 2.5 ounces of usable cannabis and grow up to 12 plants. The full text of the bill can be viewed here.

An individual may be eligible to register as a medical marijuana patient if he or she suffers from a qualifying debilitating condition such as cancer, glaucoma, or HIV. You may check the full list of approved conditions by visiting this website

According to a Medical Marijuana  Program Report presented to the Rhode Island General Assembly, there were 19,463 active registered patients, 656 active registered caregivers, and 682 active authorized purchasers in the state as of June 30, 2021. 

Medical Marijuana Dispensary and Cannabis Business Opportunities

There are three types of cannabis business licenses issued in Rhode Island:

Licensed Compassion Centers — Permitted to sell to qualified patients and caregivers. Possession is restricted to what is cultivated in their facility and acquired from cultivators.

Licensed Cultivators — Permitted to supply only to Compassion Centers. Possession is restricted by the class of their license as well as by the demand in the market.

Licensed Cooperative cultivations — Patients or caregivers cultivate plants together.

Compassion centers, cultivators, and cooperative cultivations are all subject to licensing and regulatory oversight by the Department of Business Regulation (DBR) Office of Cannabis Regulation, which is also in charge of overseeing medical marijuana plant tagging requirements under the Edward O. Hawkins and Thomas C. Slater Medical Marijuana Act.

Medical Cannabis Dispensary Application Fee and Guidelines

In addition to the registration materials, applicants for a Medical Marijuana Dispensary License must provide:

Compassion center 

  • $10,000 non-refundable application fee
  • $500,000 annual license fee

Cultivator

  • $5000 non-refundable application fee
  • Micro-license, 0 – 2,500 sq. ft., $5,000; Class A, 0 – 5000 sq. ft., $20,000; Class B, 5,001 – 10,000 sq. ft., $35,000; Class C, 10,001 – 15,000 sq. ft., $50,000; Class D, 15,001 – 20,000 sq. ft., $80,000 annual license fees

Cooperative Cultivator

  • $50 non-refundable application fee
  • $500 annual license fee

 

You may find a thorough list of Rules and Regulations related to the Medical Marijuana Program in Rhode Island here. At this time, however, no new applications for medicinal marijuana business licenses are being accepted.

Recreational Use/Adult Use Dispensary

As stated above, there are initiatives to legalize marijuana for recreational purposes in Rhode Island. Here’s what we know so far:

Senate Bill 568, An Act Relating To Food And Drugs – Cannabis Authorization, Regulation, And Taxation, introduced by McCaffrey and Miller, was passed by the Rhode Island Senate in a 29-9 vote.

  • Adults over the age of 21 would be permitted to purchase and possess up to one ounce of cannabis. They would also be permitted to cultivate up to six plants for their own personal use.
  • To oversee the market and issue business licenses, a Cannabis Control Commission would be established.
  • Retail licenses are limited to one per 20,000 residents in each town. According to some estimates, the commission may license up to 150 businesses.
  • At least one-third of all licenses would be reserved for members of impacted communities.
  • The full text of the bill can be seen here

 

Gov. McKee’s FY 2023 Budget, Relating To Adult Use Marijuana, contains his proposals to legalize cannabis.

  • McKee’s proposal would let individuals 21 and older buy and possess up to one ounce of cannabis, however it would not allow for the cultivation of cannabis at home.
  • Will be based on principles of equity, public safety, and health, among other things.
  • Adult-use marijuana sales are expected to start in April of 2023.
  • The proposal is available here

 

A third measure, HB6370 An Act Relating To Food And Drugs — Adult Use Marijuana was also filed by Scott Slater. 

  • Adults over the age of 21 would be permitted to purchase and possess up to one ounce of marijuana.
  • The Department of Business Regulation would be in charge of overseeing the cannabis program.
  • Would license up to 15 recreational stores in the start.
  • Nine licenses would be given to three existing and six prospective medical marijuana dispensaries, five would be for social equity applicants and one would be for a worker-owned cooperative.
  • The bill is available for reading here.

 

2022-S 2430, 2022-H 7593 introduced by Sen. Joshua Miller and Rep. Scott A. Slater includes:

  • Legalization of up to 1 ounce of cannabis sale for people 21 and older starting October 1, 2022
  • An independent, three-member Cannabis Control Commission is in charge of regulation, licensing, and enforcement.
  • Types of licenses are cultivator, manufacturer, testing, employee/handler, retail, and hybrid retail.
  • Each entity will only be allowed one license. Investors may, however, invest in multiple marijuana businesses.
  • City and town governments may opt out of providing licenses by resolution on November 22, 2022.
  • The bills may be read here: 2022-S 2430, 2022-H 7593.

 

As the state’s cannabis program develops, we will keep you updated on all relevant news and legislation affecting the opening of a dispensary in Rhode Island. By subscribing to our Rhode Island Cannabis Mailing List (Below), we will keep you informed of all important news and comments pertaining to Rhode Island Legalization. This includes, but is not limited to, the following:

  • What is the cost of opening a dispensary in Rhode Island?
  • What are the requirements for obtaining a license to operate a marijuana company and opening a dispensary in Rhode Island?
  • What special programs will be offered?
  • And more

 

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