The Kentucky Office of Medical Cannabis is increasing staff to handle a last-minute flood of applications from prospective medical operators, showing there is ample interest to sell cannabis in the Bluegrass State.
In total, the program received 4,998 applications for 74 available medical cannabis business licenses, most of which came during the final days of the two-month application window which ran through July until August 31. Prior to that, the state faced a drought of applications, with only 18 received three weeks into July.
“This is significantly more than any initial projection. The vast majority of these are for dispensaries, and the vast majority of those applications came in the last 24, if not 48, hours before the deadline,” said Gov. Andy Beshear during a Sept. 5 live-streamed public address.
The initial round of licenses will include 48 dispensaries, 10 processors and 16 cultivators, broken up into three tiers depending on canopy size. Tier I will get 10 licenses, Tier II gets four and Tier III will get two. The state also plans to issue Tier IV cultivation and producer licenses, but not in this initial licensing round.
Dispensary applications totaled 4,076. There were 333 applications for processor licenses and 584 for cultivation, split between 239 for Tier I, 190 for Tier II and 155 for Tier III.
Tier I cultivation allows up to 2,500 square feet of canopy. Tier II is allowed up to 10,000 s.f. and Tier III can have up to 25,000 s.f. Tier IV will allow up to 50,000 s.f. All cultivation must be indoors.
The state is splitting the number of available dispensary licenses between 11 regions. Most of the regions have an even spread of applications, between 300 and 400. The two regions on the eastern border of the state had 97 and 161 applications, while two regions in the northeast, which border Ohio and include the City of Louisiana, had 608 and 630.
The Office of Medical Cannabis sent a notice on July 25 urging prospective operators to submit their applications, because the plan was to review them in real time. Requests aside, about 88% of all the applications were submitted in the last four days of the period, according to Beshear.
“Despite the last-minute influx of applications, the Office of Medical Cannabis is currently reviewing these applications, and we remain on track to issue licenses in 2024,” he said. “We are increasing our staff, almost doubling them, for reviewing the applications. We had already taken the step to move from about nine people to about 29 people, and we’re adding another 20 on top of that to do our best to get through this as quickly, but also as accurately, as we can.”
Lotteries planned for October
Beshear said the lotteries for cultivation and processing will likely take place before the dispensary lotteries. “That makes sense because you have to grow the product, you have to process the product before you can sell the product in a dispensary,” he said.
The first lottery could take place as soon as October. Beshear said he hopes to have a firmer answer in the next couple weeks.
Kentucky borders Tennessee, Missouri, Illinois, Indiana, Ohio, West Virginia and Virginia, of which four states have legalized adult-use cannabis. West Virginia has a legal medical program, and Tennessee legalized low-THC cannabis oil for medical patients. Indiana is the only neighbor without legal cannabis.
Beshear signed executive order 798 in November 2022, which allowed residents in Kentucky with a diagnosis of one of 21 approved conditions to possess cannabis legally purchased in a neighboring state.
“Once we have dispensaries active across the Commonwealth, it is my intent to rescind that executive order,” he said.
