The Top Ten Oregon Marijuana Licensing Myths

The top ten Oregon marijuana licensing myths and the facts to clear them up.
The top ten Oregon marijuana licensing myths and the facts that clear them up.

As we draw near to January 4, the date on which the Oregon Liquor Control Commission begins accepting applications from aspiring recreational marijuana licensees, a fair amount of misinformation is swirling here in Oregon. This is happening despite the valiant efforts of the OLCC, its road show and its fairly helpful website.

Here is a top ten list of persistent myths we are hearing, and which we encourage you to ignore (the myths, not the list).

  1. Myth: I cannot apply for an Oregon cannabis license after January 4. 

Fact: Though licensing begins on January 4, applications can be submitted at anytime thereafter. There is no rule capping the number of licenses OLCC can award in any category, so it will not suddenly stop taking applications. Instead, the market will sort out the winners and losers.

  1. Myth: Only Oregon residents can apply for a license.

Fact: Only two-year Oregon residents can be “applicants,” but these applicants can choose to hold their license in a corporate entity, and as much as 49% of the licensed corporate entity can be owned by non-Oregonians. For more information on the residency requirement, check out our blog posts here and here.

  1. Myth: It will cost me $5,000 or so dollars to apply.

Fact: It costs $250 to apply. You pay the balance of the annual license fee only if OLCC approves your application, after a scheduled inspection of the premises.

  1. Myth: Marijuana business licenses will be processed and granted in the order received.

Fact: The OLCC has stated that producer and processor licenses will be issued in the second quarter of 2016. Testing lab licenses should issue early as well, though retail licenses won’t be issued until the third quarter. No word on wholesalers, although we expect they will come before retailers.

  1. Myth: If I fill out my application incorrectly, it will be denied.

Fact: The OLCC will not summarily deny a flawed application. Though we are working with our own Oregon clients to put together well proofed applications that is easy on the eyes, the OLCC has made clear that its licensing process will be iterative and its inspectors will work with each applicant (or its designated point of contact) when required.

  1. Myth: If I “opt in” to the Oregon recreational cannabis market as an existing medical cannabis grower, I get increased canopy.

Fact: Opting in gets you access to the recreational market, but you keep your OMMP grower cards and you must gather waivers from patients to sell excess marijuana into the medical and recreational markets. And once you get your recreational license, you have to shut down your medical grow. Your facility needs to be cleaned out when OLCC comes to inspect.

  1. Myth: For both indoor and outdoor cannabis production, OLCC will issue multiple licenses per parcel.

Fact: For outdoor production, OLCC will issue only one license per lot or parcel, despite the curious current language regarding “tax lots” in the rules. For indoor production (which includes anything with artificial light), OLCC may issue multiple licenses per lot or parcel, so long as there is no common ownership interest among licensees.

  1. Myth: Shared space will not be allowed for processor licensees.

Fact: Shared kitchens are allowed, but only for processors with a license endorsed in the edibles category. All other processor licensees are not allowed to share space.

  1. Myth: OLCC will not consider a building with multiple suites to have multiple “addresses.”

Fact: For producer and processor licenses, the OLCC will consider a building with multiple suites to have multiple “addresses,” and each suite will be eligible for occupation by a separate licensee.

  1. Myth: Oregon’s existing cannabis licensing rules are finally final.

Fact: The rules are temporary and will change as we go along. The legislature will make some changes in the next session, beginning in February, and the OLCC will revise these rules before adopting them as final.

For everyone applying in the first round, good luck! We will continue to update you as Oregon’s licensing process unfolds.