Cannabis operators in Oklahoma may eventually be able to ditch their RFID (radio frequency identification) tracking tags under newly proposed regulations from the Oklahoma Medical Marijuana Authority.
The new rules, which are currently open for public comment and must still be reviewed by the legislature and approved by the governor, also include numerous provisions ostensibly intended to curb diversion in a market that has been rife with unaccounted for cannabis and straw license holders from out of state.
The proposed rules replace every instance of “RFID” with “inventory tracking system.” Metrc, which is currently under contract with OMMA to provide track and trace services, uses proprietary RFID tags and is often the only option for states that seek a contract using that specific technology when tracking cannabis plants and products.
“This change does not eliminate current requirements for licensees to use RFID tags but will allow for more options beyond the traditional RFID-based technology currently being utilized and will enhance the competitive nature of any future solicitation/RFP (request for proposal),” wrote OMMA Spokesperson Porsha Riley in an emailed comment.
Oklahoma’s contract with Metrc was signed on Sept. 17, 2020, for a one-year term, with nine annual options to renew. Dropping that requirement potentially opens the door for more competition when Oklahoma re-opens its bidding process.
“The proposed rule change does not alter Metrc’s service offering or our current obligation to the state in accordance with our contract,” said a Metrc spokesperson. “Metrc will continue to partner with OMMA and the Oklahoma industry to ensure regulatory compliance needs are met for all parties.”
Attorney Ronald Durbin, who has repeatedly sued the state on behalf of cannabis operators, said that he hoped the proposed regulatory change could be a positive step toward the state amending or entirely dropping its contract with Metrc.
“It’s about time they abandon that illegal contract,” said Durbin. “It sure seems like they are setting themselves up to do that, or to lose it in court. I am still challenging it and won’t stop until I kill it.”
Durbin has been outspoken in his criticism of OMMA’s regulations, how it enforces those rules and especially the state’s contract with METRC to provide track and trace software services. METRC used RFID tags, which cultivators must purchase directly from the company at 25 cents per package tag and 45 cents per plant tag.
Full Tilt, a cannabis company with licenses for growing, processing and retail, sued the OMMA in state court on July 24, 2023. Durbin is the company’s attorney. Full Tilt argues that charging businesses for the RFID tags goes beyond the scope of the agreement with OMMA.
“Metrc must provide service both to the State of Oklahoma and businesses for the price submitted by Metrc in its bid, and it is not authorized to improperly gouge Oklahoma businesses for the fees it charges as outlined herein,” said the complaint which was filed in Ottowa County last spring, before being transferred to Oklahoma County Superior Court in July. “OMMA certainly should not be assisting Metrc, a private company, in stripping millions of dollars from Oklahoma annually.”
So far, that case remains in the pretrial phase, with a response from the state denying all of the plaintiffs’ claims being the only other significant filing on the docket.
The proposed regulations were opened to public comment on Jan. 16, with a public hearing scheduled for Feb. 16.
New regulations also address illicit activity
Aside from changes to the track and trace requirements, the new proposed rules include a series of changes that could assist the state in cutting down on diversion and renegade grows.
These changes include criminal background screenings for applicants using a national finger-print check, instead of an Oklahoma state criminal history.
All cannabis facilities must be approved by the Oklahoma Uniform Building Code Commission and the Office of the State Fire Marshal, and the OMMA can make up to two annual unannounced inspections. Additional inspections can take place if OMMA receives complaints for noncompliance from other licensees.
Cultivation licensees must provide a bond or attestation that all submitted personal info is accurate and current, additional bonds or attestations must be made in the event of an ownership or name change. All employees of a cannabis operation must be credentialed by the OMMA, and growers are not allowed to employ undocumented immigrants. Operators must obtain separate licenses for both indoor and outdoor growing if utilizing both cultivation styles at a single location. No new license holders will be permitted to have more than one license per location.
All growers must submit a $50,000 bond that covers the property of their operation or an attestation that they have owned the property for at least five years.
Dispensaries must submit patient ID numbers to the state inventory tracking system. Previously the dispensaries only had to submit information to OMMA upon request.
Instead of sales tax going to the OMMA to fund its operation, they will now go to the legislature to be redirected to fund substance abuse programs and common education, including Redbud school grants. Fines and fees will go to the legislature, which may redirect funds toward the OMMA’s operation.
