Washington, D.C. Medical Cannabis Program Update: Open Application Periods for Retail Licenses and Increased Enforcement Against Unlicensed Operators

By David M. Ullian

Feb 26, 2024

As part of the implementation of the Medical Cannabis Amendment Act of 2022 in Washington, D.C. (D.C.), which significantly expanded the existing medical cannabis program in D.C., the Alcoholic Beverage and Cannabis Administration (ABCA) will soon begin accepting new applications for licenses to operate medical cannabis retail businesses in D.C.

Below, you will find high-level information about the upcoming open application periods for retail licenses.

When Are the Open Application Periods?

Applicants that qualify as Social Equity Applicants will be able to submit applications for Retailer and Internet Retailer licenses during an open application period beginning on March 1, 2024, and ending at 4:00 PM Eastern on April 30, 2024.

Then, several months later, Non-Social Equity Applicants will be able to submit applications for Retailer and Internet Retailer licenses during an open application period beginning on July 1, 2024, and ending on August 29, 2024.

What License Types Are Available?

The two retail license types available during these two open application periods are:

1. Retailer License: Authorizes a business to dispense medical cannabis and medical cannabis products to registered patients and caregivers at a physical storefront location.
2. Internet Retailer License: Authorizes a business that does not have a physical location open to the public to sell medical cannabis and cannabis products online and by mobile application for delivery to registered patients.

Under the new law, at least 50% of all new medical cannabis business licenses are required to be set aside for Social Equity Applicants.

Licensed Retailers (and only licensed Retailers) are also eligible to apply for endorsements that authorize additional operations, including:

• Delivery: Authorizes the delivery of medical cannabis products and paraphernalia to eligible patients at residential and commercial building addresses located in D.C.
• Educational Tasting: Authorizes the offering of cooking and how-to classes, demonstrations, and tastings for educational purposes.
• Safe-Use Treatment Facility: Authorizes the on-premises consumption of medical cannabis products purchased on-site at the Retailer within designated areas.
• Summer Garden: Authorizes the sale, service, and on-premises consumption of medical cannabis products within a private outdoor space.

What Is Required to Qualify As a Social Equity Applicant?

To qualify as a Social Equity Applicant, the applicant must have at least one owner who:

1. is a D.C. resident;
2. individually or collectively owns at least 50% of the business; and
3. meets at least two (2) of the following equity criteria:
   • Is a “returning citizen,” defined as a D.C. resident who was arrested, convicted, or incarcerated for a cannabis or drug-related offense;
   • Is married to or in a civil union, has a child, or is the child of a person or has a non-parent legal guardian, or a grandparent or a sibling who is or has been arrested, convicted, or incarcerated in D.C. or any other jurisdiction for a cannabis or drug-related offense; or
   • Has an income that does not exceed 150% of the median family income as set forth by the United States Department of Housing and Urban Development (US HUD), adjusted for household size, at the time of application submission.

Can I Still Apply If I Do Not Have a Proposed Location Identified?

Yes. An applicant who has yet to identify a proposed location may submit a Conditional License Application.

An applicant that is approved for a Conditional License has up to one (1) year from the date of approval to submit the rest of the applicant documentation required for a permanent license, including property interest documentation such as a lease agreement, Certificate of Occupancy, security plan, and a permanent license application.

How Can I Submit an Application?

Applications may be submitted online (recommended), in-person, by drop box, or via email. Additional information about the application requirements is available here.

Increased Enforcement Against Unlicensed Operators

At the same time that interested parties will have the ability to apply for medical cannabis retail business licenses during the upcoming open application periods, D.C. officials are now formally authorized, pursuant to the Medical Cannabis Program Enforcement Emergency Amendment Act of 2024, to begin cracking down on unlicensed cannabis gifting stores (also known as “I-71” stores) that sell non-cannabis items or services and include a free “gift” of cannabis for the customer. Initiative 71 (“I-71”) was approved by D.C. voters in 2014 and legalized the cultivation, possession, and gifting (without compensation) of small amounts of cannabis for personal use.  

This new law, which D.C. Mayor Bowser approved on January 25, 2024, creates new requirements impacting the existing medical cannabis program and provides for a variety of enforcement actions that can be taken, including the following notable provisions.

• It is now unlawful for any licensed or unlicensed cannabis business to represent that its operations are “I-71 compliant”.
• Unlicensed cannabis establishments are now prohibited from displaying signage or visual advertising related to cannabis products and prices.
• The Alcoholic Beverage and Cannabis Board (ABC Board) may take enforcement actions, including imposing monetary fines, against unlicensed cannabis establishments that operate unlawfully.
• If a search warrant is issued for premises where cannabis retail or consumption activities are conducted unlawfully, the cannabis product and other related property may be seized and disposed of.
• The ABC Board may impose monetary fines against commercial property owners who fail to prevent unlawful retail cannabis business activities from occurring on the property.

Contact Us!

If you have any questions or would like to schedule a call to discuss applying for a license during the upcoming open application periods, please get in touch with David M. Ullian at d.ullian@vicentellp.com or 617-752-7148.