Late yesterday afternoon, the Oregon Health Authority (OHA) released draft temporary rules for the expansion of early cannabis sales into the Oregon retail market. These sales will occur through OHA licensed medical dispensaries, which have been allowed to sell marijuana flower at retail since last October. Effective June 2, those dispensaries will be allowed to sell edibles, topicals and extracts to recreational users in limited amounts. For the OHA summary of the rules, which remain “subject to minor edits,” go here.
The early sales expansion will occur pursuant to Senate Bill 1511, a piece of short session legislation signed into law on March 29. In our review of that bill, we wrote that there was no specified start date for the expanded early sales, despite the bill’s “emergency” designation. OHA reportedly availed itself of that omission to consult with the Oregon Department of Justice before rolling out the new draft rules. Nobody likes waiting around, but credit the agency for trying to get it right.
The new rules contain fairly strict limits on what can be sold at retail. Beginning next month, the early sales expansion allows licensed dispensaries to sell: (1) one cannabinoid edible containing 15 mg THC or less, per customer, per day; (2) non-psychoactive cannabinoid topicals (“applied to skin or hair”) containing no more than 6% THC; and (3) one pre-filled receptacle of extract containing no more than 1,000 mg of THC. The rest of the rules on early sales, pertaining to sales of flower and plants, still apply and there are no significant proposed changes aside from those mentioned in this paragraph.
The early sales regime continues to impose a hefty 25% sales tax on retail customers, who, in theory, could hop from one dispensary to the next to make multiple purchases on any given day. Dispensaries are nonetheless required to track and report on a quarterly basis all product sold through December 31, 2016, when the program ends. By then, stores licensed by the Oregon Liquor Control Commission (OLCC) will be up and running and the need for the early sales program will be have passed.
It is important to note that all extracts sold in the early sales program must be supplied by an OHA registered processing site, or a site that is recognized by OHA to have submitted a completed application. We explained this critical protocol recently, and continue to work with our processor clients to push these applications through. We will also begin to work with dispensary clients to prepare for early sales of edibles, topicals and extracts, which should be a major boon for the industry. So mark you calendars for June 2, the next big day in Oregon cannabis.
NOTE: We will be putting on a Webinar on May 25 to explain Oregon’s cannabis laws and how non-Oregon residents (even residents of foreign countries) can participate in Oregon’s cannabis industry. For more on that, go here.