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Delaware Cannabis Licensing Overview
2023 became a historic year for Delaware’s cannabis enthusiasts. With the introduction and subsequent passage of House Bill 1 and House Bill 2, recreational marijuana use finally saw the light of day on April 23, 2023.
Today, adults in Delaware, aged 21 and over, can legally possess up to 1 ounce of cannabis, 12 grams of concentrated cannabis products, or products containing up to 750 grams of Delta-9 THC.
As Delaware continues its cannabis journey, it’s essential for residents and businesses to remain informed, ensuring they navigate this evolving landscape compliantly and responsibly.
Delaware’s Office of the Marijuana Commissioner (OMC) plans to begin accepting adult-use Delaware cannabis license applications on September 1, 2024. The official Delaware cannabis license regulations have not yet been finalized, but drafts of the proposed regulations have been released. The OMC plans to adopt official regulations on July 1, 2024.
Even though the regulations have not been finalized, it’s never too soon to begin planning your operation. This is made especially true since the OMC anticipates accepting applications just two months after regulations are expected to be finalized.
Here are all the key features from the drafted regulations:
Marijuana Cultivation Facility
The marijuana cultivation facility license authorizes the licensee to plant, cultivate, harvest, dry, and cure cannabis plants. Delaware cultivation license holders are permitted to sell and distribute harvested cannabis, kief, and trimmings to other Delaware cultivation license facilities, manufacturing facilities, and dispensaries, or keep the cannabis and cannabis byproducts stored at their own cultivation facility.
- Cultivators growing cannabis in Delaware will need to provide samples of cannabis and cannabis products for mandatory compliance testing.
- Cultivators can also collect cannabis samples and distribute them to testing facilities for research and development purposes.
- Cultivators can prepare, package, and label cannabis to be sold to a licensed wholesaler or a retail dispensary. They can also transport products to manufacturing facilities and retail stores.
- Cultivators can destroy cannabis products.
The number of cannabis plants that can be planted and harvested depends on the license tier. The OMC has proposed the following tiers to regulate cultivators growing cannabis in Delaware:
Cannabis Manufacturing Facility License
Delaware’s cannabis manufacturing facility license authorizes the following:
- Purchase marijuana from cultivation facilities.
- Acquire marijuana concentrates or products from other manufacturing facilities.
- Extract cannabinoids for concentrates.
- Produce cannabis products, and store them.
- Sell cannabis, cannabis concentrates, and cannabis products to other manufacturing facilities and stores.
- Manufacturers must provide samples for compliance testing as directed by the Commissioner.
- Collect and transport samples for R&D testing to testing facilities.
- Handle the preparation, packaging, and labeling of products.
- Transport cannabis, concentrates, and other cannabis products to facilities and stores.
- Gather and transport samples for R&D testing.
- Dispose of marijuana and its products as per regulations.
Retail Marijuana Store License
Retail marijuana stores are the point of contact for cannabis consumers. This license will authorize the opening and operation of a Delaware dispensary. All sales must be made to individuals that are 21 years-of-age or older, or a valid medical marijuana program card holder. The retail marijuana store license permits licensees to purchase prepackaged cannabis and cannabis products from cultivation and manufacturing facilities. Licensed retailers can also sell non-consumable accessories, like clothing items at a Delaware Dispensary.
Other permissions and requirements include:
- Providing samples for compliance testing as directed.
- Collect and transport marijuana samples for R&D testing.
- Store pre-packaged units of marijuana and its products.
- Transport pre packaged units to other retail stores.
- Dispose of marijuana and its products as per regulations.
A Delaware dispensary cannot:
- Give away cannabis and cannabis products free of charge.
- Sell cannabis or cannabis products containing synthetic cannabinoids.
- Sell to visibly intoxicated individuals.
- Offer non-marijuana consumables like soft drinks and snacks.
- Sell or give away tobacco or alcohol products.
- Sell cannabis online.
- Sell more than the quantities specified in 4 Del.C. §1332 and the OMC’s regulations per transaction.
- Deliver to individuals not at the store, except for authorized medical marijuana home delivery.
Marijuana Testing Facility License
The marijuana testing facility license allows the entity to receive cannabis and cannabis product samples to conduct compliance testing and use cannabis testing equipment. Testing facilities can receive samples from cultivators, retail stores, manufacturing facilities, and authorized individuals. These facilities may also decline samples for any reason. Other authorizations and requirements include:
- Performing analysis of cannabis and cannabis samples using cannabis testing equipment.
- Providing certificates of analysis to the entity that sent the sample.
- Storing, destroying, and disposing of samples.
- Reporting testing findings.
- Receive and test cannabis and cannabis products from medical marijuana patients 21+
License Types
Open License:
This is the standard license type that encompasses all of the aforementioned licenses. Open licenses have an attached application fee of $5,000 for every license type.
Microbusiness License:
Microbusiness licenses mandate that the business has no more than 10 employees at a time. Microbusiness licenses can be either a marijuana cultivation facility, or amarijuana product manufacturing facility. Microbusinesses cultivators can only operate a tier 1 marijuana cultivation facility. There is an attached fee of $3,000 for microbusiness applications.
Social Equity License:
Social equity (SE) license will require that the applying entity meet and declare their SE status. Doing so will result in application fees reduced to $1,000.
To qualify for a social equity license, 51% of ownership and control must be held by an one or more individuals that meet the following criteria:
- Lived for at least 5 years in the past 10 in an area significantly impacted as defined by specific criteria that has yet to be released.
- Was convicted of a marijuana-related offense in Delaware before April 23, 2023. Other exceptions exist but are not yet transparent.
- Has a close family member (parent, legal guardian, child, spouse, or dependent) who was convicted for a marijuana-related offense in Delaware before April 23, 2023, with the same exceptions that have not yet been made discreet.
General Delaware Cannabis License Requirements:
To apply for an open, social equity, or microbusiness license, applicants must fulfill all relevant criteria. For business entities, this includes all owners, officers, and directors holding over 10% of the issued shares, who must also comply with these requirements:
- Applicants must be 21 years-of-age or older. If the application is for a business entity, all owners, officers, and directors must be 21+.
- Applicant(s) must submit a criminal history background check and fingerprints for all officers, owners, and directors. Applicants must cover any associated costs.
- Applications must include all required forms, documentation, and any other paperwork featuring complete and truthful information.
- Criminal convictions may or may not impact general eligibility criteria. Refer to page 6 of the Delaware Marijuana Adult Use Regulation Sections 3-5 for more information about legal eligibility. Regulations draft can be found here.
- Applicants cannot own more than one marijuana establishment of the same license type in a single county.
Application Requirements
The OMC will disclose how and where to submit applications before the application window opens. The OMC will decide if an application should be submitted into the lottery draw after reviewing eligibility based on the following:
- Comprehensive business plan, which will include a budget, pro forma financial statements, likelihood of success, experience, training, expertise and more.
- Plans for security, safety, and product diversion prevention.
- Operational plans including staffing details, a social responsibility plan, work environment plans, and more.
- Cultivators and manufacturers must submit an environment and sustainability plan
Application Review Process
Application windows will be announced at least ten (10) days before the application period begins. This announcement will disclose the types and amount of licenses that will be available during that application period, and the dates that the window opens and closes. Each application window will be open for 30 days. The OMC can choose to award fewer licenses than initially announced if there is an insufficient number of eligible applications.
The OMC can decline applications for any of the following reasons:
- The application is missing important information.
- The application includes false or misleading statements, or important details are left out.
- The application does not fulfill the basic Delaware cannabis license requirements.
- The application was not submitted on time.
- The applicant did not submit extra information that the OMC asked for.
Expenses
Every Delaware cannabis license has an attached application and a renewal fee that must be paid to the OMC every two (2) years. The fees are as follows:
Open License Application Fee: $5,000
Open License Renewal Fees:
Retail marijuana store: $10,000
Marijuana testing facility: $10,000
Indoor cultivation facility (up to 2,500 sq ft) or outdoor facility (up to 1 acre): $2,500
Indoor cultivation facility (2,501 to 7,500 sq ft) or outdoor facility (1.1 to 2.5 acres): $5,000
Indoor cultivation facility (7,501 to 10,000 sq ft) or outdoor facility (2.6 to 5 acres): $7,500
Indoor cultivation facility (10,001 to 12,500 sq ft) or outdoor facility (5.1 to 7.5 acres): $10,000
Marijuana product manufacturing facility: $10,000
Social Equity Application Fee: $1,000
Social Equity License Renewal Fees:
Retail marijuana store: $4,000
Marijuana testing facility: $4,000
Indoor cultivation facility (up to 2,500 sq ft) or outdoor facility (up to 1 acre): $1,000
Indoor cultivation facility (2,501 to 7,500 sq ft) or outdoor facility (1.1 to 2.5 acres): $2,000
Indoor cultivation facility (7,501 to 10,000 sq ft) or outdoor facility (2.6 to 5 acres): $3,000
Indoor cultivation facility (10,001 to 12,500 sq ft) or outdoor facility (5.1 to 7.5 acres): $4,000
Marijuana product manufacturing facility: $4,000
Microbusiness Application Fee: $3,000
Microbusiness Licenses Renewal Fees:
Retail marijuana store: $4,000
Marijuana testing facility: $4,000
Indoor cultivation facility (up to 2,500 sq ft) or outdoor facility (up to 1 acre): $1,000
Marijuana product manufacturing facility: $4,000
All licensees must meet specific criteria and provide a labor peace agreement when renewing.
Licenses Awarded by Lottery
Applicants who meet the basic qualifications will enter a random lottery system managed by the Commissioner to decide who gets the licenses.
- Within 10 days after the lottery, the Commissioner will notify applicants if they have been selected.
- Selected Applicants might need to provide extra details or documents to confirm parts of their application.
- The Commissioner can refuse to give a license if a selected applicant doesn’t provide the requested additional information within 10 business days or if the new information shows the applicant doesn’t qualify for the license.
- Applicants that don’t get selected for licensure can request that the OMC retain their application and resubmit it in the next applicable license lottery drawing
Application and License Issuance
- Applications will be completed on forms distributed by the OMC.
- Applicants will not need to own or obtain any property or facility before receiving a conditional license.
- The OMC may check if an applicant qualifies as a social equity applicant before they submit their initial application and may ask the applicant to provide supporting documents. All information provided by an applicant to prove their social equity status is part of their application.
- Selected that need to supplement their application with additional information will have ten (10) business days from the date of notification to submit any required documentation and/or information.
Why Choose CannDelta?
By choosing CannDelta you’re establishing a partnership with a team of Delaware cannabis consultants that are deeply committed to your success. Our extensive experience across North America equips us with a distinctive perspective on the changing dynamics of the cannabis industry. Our team of Delaware cannabis consultants are experts in Delaware’s evolving regulatory space, and hold all the tools you’ll need to launch a successful cannabis business. Here’s how we can help:
Cannabis License Applications:
Enter the cannabis market with assurance. Our team delivers extensive support in preparing, submitting, and monitoring your license application to keep you compliant and competitive.
Business Plan Development:
Establish a strong foundation for your cannabis venture. We create business plans that adhere to regulatory demands and set the stage for ongoing growth.
Security Plan:
Our specialists devise comprehensive security plans that safeguard your assets, fulfill state regulations, and provide peace of mind.
Site Audits and Inspections:
Stay proactive with our thorough site audits. We pinpoint potential problems and provide practical solutions to keep you compliant and efficient.
Standard Operating Procedures:
Optimize your daily operations with a customized operating plan aimed at boosting efficiency.
We develop SOPs that are clear, compliant, and facilitate the smooth operation of your business.
Marketing Plan:
Let your brand stand out! We assist in building your brand and devising outreach strategies to make your mark Delaware’s brand new cannabis market.
Employee Staffing and Training Plan:
With our recruitment strategies and customized training programs, we ensure your team is equipped to excel in the cannabis industry.
Fill out a form below to get in-touch with our Delaware cannabis consultants today!
Frequently Asked Questions
Can You buy From a Dispensary in Delaware?
As soon as dispensary licenses are distributed and legal dispensaries begin opening in Delaware, anyone 21+ will be able to purchase cannabis for recreational use. Delaware’s OMC expects plans to begin accepting dispensary license applications in September 2024. Dispensaries will begin to open during the months and years that follow.
Is it Legal to Grow Marijuana in Delaware?
It is illegal to grow cannabis in Delaware at home. Growing cannabis in Delaware requires a Marijuana cultivation facility license that has been issued by the State of Delaware Office of the Marijuana Commissioner, and a compliant facility and operation setup to do so.
How Much is a Marijuana License in Delaware?
A marijuana license in Delaware has varying expenses that depend on the license type. Each license has an attached application fee ranging from $1,000 (social equity) to $5,000 (open license) and a facility specific biennial renewal fee ranging from $1,000 to $10,000.
How do I Start a Dispensary in Delaware?
Starting a dispensary in Delaware requires a retail marijuana store license issued by the State of Delaware Office of the Marijuana Commissioner (OMC). The entity applying for a license must submit all the required documents along with an application, and pay the required application fee. The applying entity will need to follow the application process that will be disclosed by the OMC at least ten (10) days prior to the application window opening. Each application window will be open for 30 days. The first application window expected to accommodate retail marijuana store licenses has a proposed opening date of September 1, 2024.
