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How To Open A Dispensary In South Carolina

Overview

Are you wondering how to open a dispensary in South Carolina? This page is dedicated to keeping you up to date on the latest news and information relevant to opening a cannabis business in South Carolina. This includes helpful insights on what is to come next. 

Marijuana in South Carolina remains illegal for recreational use, with limited medical use allowed only for cases with severe epileptic symptoms with a prescription.  In late 2020, Sen. Tom Davis and Rep. Bill Herbkersman (R) filed the Compassionate Care Act (S. 150/H. 3361) to legalize medical marijuana in the state.  In March 2021, it passed with a vote of 9-5 in the Senate Medical Affairs Committee. This provides hope to many, especially for those who suffer from chronic conditions and benefit from the use of marijuana.

On February 10th, 2022, the South Carolina Senate passed S. 150. This bill, known as the “South Carolina Compassionate Care Act,” aims to legalize medicinal marijuana in South Carolina. On March 31st, the Committee on Medical Affairs endorsed the bill with several changes. Throughout early 2022, after extensive modifications and discussions, it underwent a second reading on February 9 and was sent to the House on February 10. It was later on assigned to the House Committee on Medical, Military, Public, and Municipal Affairs, which subsequently supported it with further revisions on April 19. Despite this progress, the bill was ultimately ruled out of order on May 4, 2022, following additional debates.

In addition to the bills filed by Sen. Davis and Rep. Herbkersman, two other significant bills were pre-filed in the House for 2021 hearings, reflecting the increasing support for the legalization of marijuana for medical use. These are:

  • The Put Patients First Act (H. 3174)was originally intended for medical marijuana but has later undergone a shift in focus. This bill was introduced in the House on January 10, 2023, and is currently in the House Committee on Judiciary, now addressing the establishment of a civil offense for littering and revising penalties for such offenses.
  • The other bill is H. 3202 for the Access to Cannabis for Selected Military Veterans. This bill, which was also introduced on January 10, 2023, is currently under review in the House. It has evolved from its initial goal related to cannabis access for military veterans and now focuses on inmate cancer screenings, specifically mandating cervical and ovarian cancer screenings for women in correctional and detention facilities.

In a  2019 poll,  South Carolina residents have shown their support for the legal use of medical marijuana with results showing 72% of it, and 23% were in favor of its recreational use. Locals support the use of cannabis for any medical condition, even when the state law says otherwise.

On January 8th, 2024, a bill to legalize medical marijuana for severe diseases like cancer and epilepsy was introduced in South Carolina’s Senate. Despite previous challenges and opposition from some Republican senators and law enforcement, the bill, considered “very conservative,” focuses on non-smokable forms like edibles and vapes, with strict regulations for all involved. Having passed the Senate before but rejected in the House, this revised version, excluding the tax component, brings renewed hope for its approval.

On May 9th, 2024, as the South Carolina legislative session approached its conclusion, the fate of the medical cannabis bill was rejected. Despite efforts, the bill did not advance beyond a House committee for the second consecutive session. It failed to gain traction in the House after previously being passed by the Senate. Technicalities cited by House leadership hindered its progress. Advocates for the bill expressed determination to continue their efforts, even considering personal lobbying of House members.

The Opportunity Size

When it comes to the opportunity size for South Carolina, as legislation seeks to expand the medical marijuana program, we are truly at the ground floor. As this starts to occur, analysts and groups with a vested interest in legalization will start to make relevant projections as to the opportunity size and tax revenue to the state. By signing up for our newsletter below we will keep you up to date on the latest reports.

At present there is no means to apply for a license as a marijuana business, but the 2018 Farm Bill allowed farmers to cultivate hemp for CBD. Hemp program coordinator David DeWitt of the Clemson Cooperative Extension Service stated that hemp was selling for $40 to $50 in 2018. 

In 2019, industrial hemp leader Hemp, Inc. announced that there has been a 565% increase in South Carolina hemp farmers since 2018. The South Carolina Department of Agriculture issued 113 permits to hemp farmers in 2019, which is a significant increase from the 20 farmers recorded in the previous year.

The cap for hemp growers has been removed, which resulted in a 1,189% increase from 2018 reflected in the 3,300 acres used for hemp production in 2019. In December 2020, the South Carolina Department of Agriculture announced that it is already accepting applications for a hemp farming permit in 2021. 

Given the significant increase in hemp farming, there are high hopes for the approval of marijuana cultivation in the state.

Medical Marijuana

When it comes to medical use, THC oil in certain conditions and CBD oil as long as its CBD and THC are legal as long as it is not more than 0.90% THC is legal in South Carolina. This premise on marijuana use is under the “Julian’s Law” enacted in June 2014.

Previous medical cannabis laws focus on the approval of medical cannabis only for severe epileptic symptoms. This prompted Sen. Davis (S. 150) and Rep. Bill Herbkersman (H. 3361) to pre-file two versions of the bills in December 2020 which will create a much larger opportunity for medical marijuana.

Both bills, one for the Senate and one for the House respectively, are called the “South Carolina Compassionate Care Act”, which aims to provide safe access to medical cannabis to individuals with chronic diseases and terminal illnesses. The bills propose the creation of a board to review the conditions that will be added to the list where medical marijuana is approved.

In 2023, South Carolina’s efforts to pass medical cannabis legislation faced obstacles, prompting a renewed push in 2024. In 2022, the Senate approved S. 150, a medical cannabis bill, but it stalled in the House due to procedural issues. Sen. Tom Davis introduced a revised bill, S. 423, in 2023 to address these issues. However, the Senate declined to advance S. 423, leaving it for consideration in 2024. Public engagement is crucial, as South Carolinians seek to join 38 other states in granting medical cannabis access.

The state will be among the 41 US states and territories that allow cannabis for medical use if either bill from Sen. Davis and Rep. Herbkersman passes.

Here’s a timeline of the previous attempts at legalizing marijuana in South Carolina:

  • In 2015, The Medical Marijuana Program Act (H. 4037, S. 672) was introduced. However, it was rejected by the Senate Medical Affairs Committee in 2016.
  • In 2017, the Compassionate Care Act had a version that failed to gain a majority of the votes.
  • In 2019, The laws (H 3081, H 3272) that will legalize marijuana did not advance to committee review.
  • The Compassionate Care Act of 2019 (H. 3660 and S. 366) was introduced to legalize marijuana use for medical purposes on a broader scope.
  • In April 2019, the bill version that covers cannabis flower for medical use failed to meet the deadline for the House passage.

Local Cannabis Restrictions & LawsIn each state, there will be some communities that are in strong support of the state legislation, some with not-so-strong support, and others that outright do not agree with the state’s decision. 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. As South Carolina’s cities or towns form their stances on laws, whether it’s outright bans or particular restrictions, we will keep you up to date on this section here. 

Medical Marijuana Program Opportunities

The new versions of the South Carolina Compassionate Care Act advocate for the regulation of medical cannabis with access not just limited to individuals who experience epileptic symptoms. It aims to push a medical marijuana program that will allow seriously ill individuals to safely use marijuana with the recommendations of their physicians.

The bills aim to protect not only the patients and caregivers but also the staff of medical cannabis establishments among others. Establishments are responsible for imposing a ban on the use of cannabis in the workplace. Under H.3361, an additional provision states that no requirement will be imposed on private employers to make policy changes regarding drug testing.

Below are the proposals under the South Carolina Compassionate Care Act H. 3361 / S. 150.

Covered Illnesses

The serious medical conditions that are stated in the new two versions include neurological disease or disorder (including epilepsy), sickle cell anemia, cancer, multiple sclerosis, glaucoma, PTSD, autism, Crohn’s disease, ulcerative colitis, and cachexia. The bills also cover people with severe muscle spasms, terminal illnesses with a one-year life expectancy, chronic or debilitating diseases where an opioid could be prescribed, and chronic conditions where opioids can be prescribed.

The bills will also create a Medical Cannabis Advisory Board designated to review petitions for additional serious conditions to the medical marijuana program.

Limitations

The limitations state that the patients should not engage in any activity that can cause negligence or professional malpractice while under the influence of cannabis medication. Patients and caregivers are prohibited from growing their own cannabis. Suspension and revocation of ID cards will be imposed on any cardholder or staff of a medical cannabis establishment who will be caught violating the law. Civil and/or criminal charges can also be filed against them. Additionally, smoking cannabis remains illegal, as do raw cannabis and paraphernalia used to smoke cannabis. Violations may result in the suspension or revocation of a patient’s ID card.

Cannabis Business License Opportunities 

DHEC will use a merit-based application process to issue licenses to 30 processing facilities, 15 cultivation centers, 5 testing laboratories, 4 transporters, and 1 dispensary assigned for every 20 pharmacies. The local governments can regulate the location, number of cannabis, and operating hours of establishments. However, they don’t have the power of completely prohibiting the operations of dispensaries.

Taxes and Application Fees

DHEC will identify the application and licensing fees that aim to cover regulatory costs. The tax for cannabis will be fixed at 6%, just like the rate imposed on non-prescription medications. Distribution of revenue will be allocated as follows: 3% for improvement of DUI detection, 2% for education on drug safety, 5% for research on medical marijuana, and 90% goes to the General Fund.

As the Palmetto state expands its cannabis program, we will be keeping up-to-date on all relevant news and legislation that is relevant to opening a dispensary in South Carolina.  By adding yourself to our South Carolina 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 SC Legalization below. This includes but is not limited to:

  • How much does it cost to open a dispensary in South Carolina?
  • What are the requirements to get a marijuana business license and open a dispensary in South Carolina?
  • What special programs will be available?
  • And more

 

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