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What to Do After Getting a Cannabis License in Delaware
- You secured your license. Now what? Now that you have a cannabis license in Delaware, there are some ‘next steps’ that the Office of the Marijuana Commissioner (OMC) requires you to complete before you begin operating.
Depending on your license type, some of the documents you may need to submit include: - Plan to obtain liability insurance
- Certificate of Tax Clearance for corporate and personal income taxes
- Authorization for release of information
- Affidavit of representative of applicant
- Regulatory Compliance Plan
- Site plans
- Site control documents
- Zoning approval
- Finalized security plan
- Finalized business plan
- Finalized financial plan
- Finalized operational plan
- Standard Operating Procedures for Adverse Event Reporting
- Standard Operating Procedures for Quality Assurance/Control
- Standard Operating Procedures for Recall
- Standard Operating Procedures for Inventory Control, Storage, Diversion Prevention
- Standard Operating Procedures for Waste Disposal, Sanitation
- Standard Operating Procedures for Accounting and Tax Compliance
- Standard Operating Procedures for Age Verification
- Standard Operating Procedures for Secure Transport of Marijuana
- Minority, Women’s, Disabled Veteran’s Certifications (if applicable)
- Cultivation plan
- Standard Operating Procedures for Packaging and Labeling
- Standard Operating Procedures for Sampling and Testing of Cannabis
The OMC allows new licensees 18 months from the time they’re awarded their conditional license to submit further documentation and complete the required steps before starting operations.
The Supplemental Application Process
In December 2024, the OMC announced the applicants chosen to join the legal cannabis market of Delaware. To ensure fairness, the Delaware marijuana lottery selected 15 (out of 519) applicants for Delaware cannabis retail licenses. The OMC distributed these 15 licenses equitably across the three counties.
- 7 licenses for New Castle County (from a pool of 210 applicants).
- 5 licenses for Sussex County (from a pool of 168 applicants).
- 3 licenses for Kent County (from a pool of 151 applicants).
- 20 Open Cultivation: 4 Kent, 9 New Castle, 7 Sussex
- 10 Social Equity Cultivation: 2 Kent, 5 New Castle, 3 Sussex
- 20 Micro Cultivation: 6 Kent, 6 New Castle, 8 Sussex
- 7 Social Equity Micro Cultivation: 2 Kent, 5 New Castle
- 10 Open Manufacturer:2 Kent, 5 New Castle, 3 Sussex
- 10 Social Equity Manufacturer: 2 Kent, 5 New Castle, 3 Sussex
- 7 Micro Manufacturer: 2 Kent, 5 New Castle
- 15 Social Equity Retailer: 3 Kent, 7 New Castle, 5 Sussex
Next Steps…
There are still several steps before you can legally operate as an owner of a new dispensary in Delaware. The selected applicants received notifications from OMC so they can proceed with the supplemental Delaware cannabis application process, to transition from the conditional license. Note that a conditional license differs from an active license. To fully transition to an active license, Delaware marijuana lottery winners need to fulfill additional compliance and operational standards.
Conditional licensees must identify the physical location, pass the background checks, and get approval from the Commissioner. Licensees have eighteen months (from the date of the license grant) to become operational. The OMC may extend the period if the business has shown efforts to begin operations. Otherwise, the OMC rescinds the conditional license.
Start Building Your Facility
The most suitable location for your new dispensary in Delaware must be accessible, visible, and compliant with local zoning, fire codes, and building codes. Approach the local committee in charge in your county and ask for the zoning regulations, specifically about areas that are plausible as a cannabis business location. Proximity to sensitive areas (schools, playgrounds, churches, etc.) is also crucial.
Make sure your business can afford the real estate costs in the long run. This includes the lease, taxes, and incidental costs for future zoning and security upgrades. Here are some considerations when deciding:
- Retail dispensaries at premium locations with high foot traffic usually request high real estate costs.
- Delaware Cultivation license facilities and manufacturing facilities are usually great in areas that have relaxed zoning regulations.
- Whether a business plans to construct or retrofit, it needs to build robust security systems, HVAC setups, and a controlled environment for lighting and changing climate.
- For businesses with a tight financial plan, leasing can be a great way to avoid higher initial costs. Buying commercial property is a huge upfront investment which might be good for those with huge capital.
Solidify The Business Structure
Businesses must submit business plans during the Delaware cannabis application period. Upon the approval of the conditional licenses, it’s time to take action to solidify those plans. While some big conglomerates and business entities can navigate this seamlessly, most businesses might need to work with legal and financial advisors to find what structure is best first future operations and the business objectives. Formation document is one of the Delaware cannabis license requirements.
To successfully launch and sustain operations, cannabis businesses need sufficient funding for both startup and ongoing costs. Many companies rely on private investors or industry-specific lenders to avoid high interest rates and tough negotiations. Still, businesses should explore all options, including banks and investors, and conduct thorough due diligence when self-financing isn’t feasible.
Secure Permits and Licenses
To start your cannabis business seamlessly and avoid delays, make sure you secure local and state permits. Here are some permits you’ll need to get for your cannabis business in Delaware:
- Cannabis manufacturers need to secure environmental permits if required.
- For manufacturing, processing, and storage of cannabis products, implement protocols that ensure safety and sanitation.
- Depending on the facility size and business growth projection, cumulative local permits may total anywhere from $20,000 to $100,000.
- To verify if your facility meets local fire and building codes, the OCM may request inspections.
Employment Plan for Management and Operations
It’s vital to ensure the team is highly skilled and knowledgeable to produce the highest quality cannabis products. For a new dispensary in Delaware, expertise in retail operations and a superb understanding of marketing restrictions can benefit the business in the long run. Meanwhile, Delaware cultivation license holders should tap into local growers and farmers who can navigate a controlled environment with horticulture and innovate with different cannabis strains.
Employees must also comply with OCM criteria (including background checks). As a mandate for all employees in the US, they need to complete Form I-9 to ensure eligibility to work in the US.
Cannabis businesses should establish standard operating procedures (SOPs) to assemble a well-qualified and compliant team to ensure operational success. A cannabis business must also still establish a drug-free workplace, as set by federal laws.
Ensure Compliant Record-Keeping and Accounting Practices
Soon after lottery selection, winners of new licenses need to submit supplemental requirements. OMC notifies the new licensees about such, as most of the time they will depend on the type of business and license applied for. Aside from zoning permits and building inspections, cannabis businesses must secure a system that allows proper record-keeping.
- Tax deductions don’t apply for entities that handle controlled substances (i.e., cannabis). It’s crucial to maintain ledgers for sales, expenses, inventory, etc.
- Businesses must still file federal tax returns and payroll forms (Form 941).
- Be ready for regular internal audits.
Security Measures in Facilities
- Install facility secure systems that may include video surveillance, alarm systems, and secured entry points.
- Implement seed-to-sale tracking systems.
- Review security and record-keeping plans, following the guidelines set by the OMC.
Begin Your Cannabis Journey with CannDelta
If you are holding a Delaware cannabis license, this is your opportunity to get ahead of the competition and start preparing your cannabis business.
Expert assistance can reduce compliance-related setbacks. CannDelta’s team of professional consultants has helped businesses across the United States increase their chances of winning the coveted license and crafting business plans that align with Delaware cannabis license requirements alongside their long-term goals. Contact CannDelta today and become a key player in the Delaware cannabis landscape once it opens!
Frequently Asked Questions
Is marijuana legal in Delaware?
Yes. Recreational marijuana became legal in Delaware in April 2023. However, retail dispensaries in Delaware are yet to open and begin operations in 2025. Regarding medical cannabis, patients may use cannabis for alternative treatments as long as they have secured their medical marijuana card. Compassion Centers (medical dispensaries) have been open in Delaware for quite some time.
What are the next steps for selected cannabis lottery winners in Delaware?
OMC will send notifications regarding additional requirements to cannabis license lottery winners. This will depend on the size of the business and other factors, but one of the prominent requirements is the approval of facility inspections and zoning permits. OMC also requires these conditional licensees to act immediately, as they’re only given 18 months to begin operations.
Can I get a refund if I don't win a cannabis license in Delaware?
The application fee for cannabis licenses in Delaware is non-refundable. Applicants should be 100% sure about their business goals. Alongside, you understand that the selection process involves a lottery, which therefore means the possibility of not getting picked is as just as likely as being granted a cannabis license.
