Application Requirements: A Must Read For Anyone Considering Applying

Hello and welcome back to Stock Legal’s blog series on microbusiness cannabis licenses in Missouri. In the last post we spent time going through the important dates and deadlines that will be associated with the application process. Last time I ended the blog by telling you all that we would take a deep dive into some of the items and tasks you should look to complete while we wait for application guidance. However, this week the Department of Health and Senior Services’ Division of Cannabis Regulation (“DCR”) informed the industry that they were scraping the most recent proposed rules and instead sent out a 117-page document with new rules and regulations that must be followed. Most importantly for you, there has been an update on the information required for the microbusiness applications, and I will use today’s blog post to help explain what’s being asked. This blog post will be long, but I assure you it is worth the read if you are considering applying in July.

Under Missouri rule 19 CSR 100-1.060, Facility Applications and Selection, the DCR has added language specific to microbusiness license applications. If you don’t know what those letters and numbers mean, don’t stress over it, it is merely designating the rule under the Department of Health and Senior Services’ DCR marijuana regulations. It is within this rule section that we find the process for facility applications for all license types, including microbusiness licenses. It is important to remember that unless otherwise identified in this rule, all the application requirements relate to commercial and microbusiness licenses. In other words, don’t look for microbusiness language only, you need to pay attention to all of it.

To begin with, as a point of clarity, you may recall that microbusiness cannabis license applicants may have the ability to receive a refund of their application fee so long as DCR determines the applicant met the criteria to apply for a microbusiness facility license and the applicant has no pending or future legal actions related to the denial. The DCR has added a timeframe to expect for the refunds, providing that individuals may request a refund beginning 31 days after the date of denial and up to 6 months after the denial. It is important to remember that just because the DCR determines you are eligible for a refund, it does not mean that you are otherwise qualified for a license or entitled to a license in future application submission windows.

Let’s turn now to the specific requirements that must be met during application submission to be considered for being entered into the lottery drawing. To start, all applications for licensure must include at least the following information:

1. Name and address of the responsible/designated person for the company applying.
2. The legal name of the company applying, and any other names that business goes by.
3. All owners of the applying company must be identified with their associated percentage of ownership in the company. You must also provide this information in the form of a “visual representation” of the ownership structure.
   1. Most companies create this visual representation through spreadsheets or tables that lists each owner and their corresponding ownership in the company.
4. If applying for a license to cultivate, manufacture, or dispense marijuana, you must submit a signed statement indicating that the company is not and will not be under the same control or ownership as a marijuana testing company in Missouri.
5. Proposed address of the facility, including:
   1. A statement confirming that the proposed location will meet all location requirements from the DCR and local government. This includes the requirement that the facility won’t be located within 1,000 feet of a school.
   2. A copy and hyperlink to the applicable local government requirements, including zoning requirements.
6. Proposed blueprints for your facility that outlines all features of every room and area, clearly labeled with its designated purpose, and must include square footage, camera locations, and access permissions for restricted limited areas.
7. If you are planning to cultivate marijuana at your facility, you will need to include the cultivation practices that will be used by the facility, designating whether you will be practicing indoor, outdoor, or greenhouse cultivation, or a combination thereof.
8. A statement that all individuals subject to the application process will submit fingerprints within 2 weeks after the application submission for a state and federal criminal background check to ensure that none of your individuals have disqualifying felony offenses; and
9. All applicable fees that will be owed.

I know that the information above can seem like a lot and the idea of gathering all of it can feel daunting. I have been in this position myself, and my advice to you is to take it one step at a time. If you try and accomplish all this simultaneously items will slip through the cracks and you will likely miss information that needs to be provided, rendering your application incomplete. In addition to the information required above, there is a set of microbusiness application-specific information that must also be included, which is broken down based on which of the qualifying criteria for microbusiness that you are choosing see Blog Post 1 for a refresher.

1. A statement that the applicant does not have an owner in their company who is also an owner in an existing medical, commercial, or another microbusiness license.
2. A valid (not expired) government-issued photo ID, such as a driver’s license.
3. For applicants claiming a net worth of less than $250,000.00:
   1. Sworn financial statements demonstrating a net worth of less than $250,000.00, and must include all marital property, unless you provide sufficient evidence to prove the property is not jointly owned; and
   2. Documentation proving that your gross household income was below 250% of the federal poverty guidelines issued by the U.S. Department of Health and Human Services for at least 3 out of the last 10 years.
      1. You can use documents such as: tax returns, paycheck stubs summarizing full income, W-2s, evidence of job loss, and others.
   3. For applicants claiming a service-connected disability:
      1. A copy of applicant’s current veteran health ID card demonstrating a service-connected disability; or
      2. A copy of applicant’s VA benefit summary letter, which may not be older than 6 months at the time of application submission; or
      3. A copy of the applicant’s VA award letter, which again may not be older than 6 months at the time of application; or
      4. If none of the above is available, some other evidence that DCR may deem sufficient.
   4. For applicants claiming an arrest, prosecution, or conviction for a non-violent marijuana offense:
      1. A copy of the relevant arrest record; or
      2. A copy of the relevant FBI background check; or
      3. A copy of the relevant arrest record and a letter from the prosecutor’s office indicating the charge filed; or
      4. A copy of the relevant arrest record and a certified copy of the judgment of conviction; or
      5. A copy of the relevant arrest record and a certificate of expungement from a court.
      6. If the arrest, prosecution, or conviction was for the applicant’s parent, guardian, or spouse:
         1. A valid (not expired), government issued photo ID of your parent, guardian, or spouse; and
         2. Proof of relationship.
            1. For this you could use a birth certificate, judgment of adoption or guardianship, marriage certificate, or others.
         3. For applicants who are claiming residency in a ZIP code or census area where either 30% or more of the population lives below the federal poverty level or unemployment is 50% higher in that area than state average, you must include:
            1. You need 2 separate types of utility bills (ex. One water and one electric) that must be dated no later than 4 months from the time you submit your application, and they must include:
               1. Applicant’s name;
               2. Dates of service;
               3. Service address; and
               4. The billing address; OR
            2. You can provide a copy of a current residential lease, which must include applicant’s name and the relevant dates and a statement from the applicant confirming that is their residence; or
            3. A copy of the applicant’s residential mortgage which has the address and applicant’s name along with relevant dates; or
            4. A copy of applicant’s real or personal property taxes, from within the last 12 months, with applicant’s name, address, and relevant dates; or
            5. Other documentation sufficient to demonstrate residency and documentation or screenshot from the most recent 5-year estimates published by the American Community Survey of the U.S. Census Bureau, so that the department can verify the ZIP code or census tract has qualifying poverty or unemployment rates.
         4. For applicant’s claiming residency in a ZIP code or census area where the historic rates of incarceration for marijuana-related offenses is 50% higher than the entire state:
            6. All of the same information is sufficient as listed above in #6.
               
            
            

Have your eyes glazed over yet? I get it, the information in this blog post is daunting, and it may feel like you don’t even know where to start. The first 9 requirements that are listed in this blog are requirements for everyone. At a minimum, you should make sure you can satisfy all those requirements. The other 7 requirements related to the specific qualifying conditions as part of the microbusiness application process. You do not need to satisfy all 7, you need only satisfy the first two and then any of the five remaining requirements and their sub-requirements. Hopefully you have already identified which qualifying condition you and your company are going to meet for the application, but if you haven’t, take the time to read through those listed above and see if you fit neatly into any of those categories.

The application submission window will be here before you know it, so I urge you to begin working now to secure all the necessary proof you will need based on the information above. This sort of information can take time to gather and to verify it meets the conditions we know DCR will require, so don’t save this crucial step until the very end. If you don’t know what some of the required information above means, or where you can obtain it, please feel free to reach out to our firm, Stock Legal, or your bank and previous tax records are a good place to start. Stay tuned, as next week we will broadly touch on some of the requirements for operating in the industry that you should keep in mind when deciding if a microbusiness cannabis license is the right endeavor for you.