Eleven Critical Tasks Every Prospective Arizona Medical Marijuana Dispensary Must Accomplish to Be Able to Submit an Application to DHS for a Medical Marijuana Dispensary License

Updated on January 14, 2012, from my task list first published on April 24, 2011.

I am reposting and updating this article in light of the fact that Arizona Governor Jan Brewer ordered the Arizona Department of Health Services to implement medical marijuana dispensaries in Arizona.  Check back because I will update this task list when ADHS issues the new time lines and changes to its regulations.

Here is my list of critical tasks that each prospective Arizona medical marijuana dispensary must accomplish before it can file an application for a dispensary registration certificate beginning [new date to come from ADHS].  If any one of the following is not satisfied on or before [new date to come from ADHS], the last day to file the application for a dispensary registration certificate, the application will be rejected.

1.  Find a Properly Zoned Site Where the Dispensary Will Operate.  Find a site where the nonprofit entity could operate its dispensary. You must show the “physical address of the proposed dispensary” on the application.  R9-17-304.D.1.b.  The site must be properly zoned.  See “Prospective Dispensary’s Single Most Important Task Before April 30, 2012,” “How Does My Dispensary Tie Up Land for its Retail & Cultivation Sites?” and “CHAA on This!“

2.  Landlord Comfort Letter.  R9-17-304.D.7 requires that the dispensary applicant get written “Permission from the owner of the physical address of the proposed dispensary for the entity applying for a dispensary registration certificate to operate a dispensary at the physical address.”

3.  Zoning Comfort Letter.  Obtain a comfort letter from the appropriate zoning authority that says the the proposed location of the dispensary is “groovy.”  Rule R9-17-304.D.6 states that the comfort letter must be “from the local jurisdiction where the dispensary’s proposed physical address is located” and it must say that “There are no local zoning restrictions for the dispensary’s location, or . . . The dispensary’s location is in compliance with any local zoning restrictions.”  See “Must My Dispensary Obtain a Conditional Use Permit from the City before it can File an Application for an Arizona Medical Marijuana Dispensary License?,” the DHS FAQ DI12 & DI13 about certificates of occupancy and special use permits,

4.  Medical Director.  Enter into a contract with a medical director who has obtained a license from Arizona Department of Health Services to act as the medical director.  The application must include the medical director’s DHS license number.  R9-17-304.D.1.e.  This means the medical director must apply for his or her DHS license asap.  See “Clauses to Include in a Contract between a Medical Director & a Dispensary.”

5.  Policies & Procedures.  Prepare the following written policies and procedures per R9-17-304.D.4 that comply with the requirements in the DHS rules for:

a. Inventory control (task 5),
b. Qualifying patient record-keeping (task 6),
c. Security (task 7), and
d. Patient education and support (task eight)

You should be working on these documents now so they will be ready when you submit the application.

9.  By-laws.  Prepare the dispensary’s by-laws containing provisions for the disposition of revenues and receipts.  R9-17-304.D.8 See “What the Final DHS Rules Require to Be In Dispensary Bylaws,” “Bylaws for Arizona Medical Marijuana Dispensaries,” “Bylaws – We Don’t Need No Stinking Bylaws or Do We?”

10.  Business Plan.  Prepare a business plan demonstrating the on-going viability of the dispensary on a not-for-profit basis.  R9-17-304.D.9.  See “What Must be In an Arizona Medical Marijuana Dispensary Applicant’s Business Plan.”

11.  Bank Comfort Letter.  Last minute rules R9-17-302A.5 and R9-17-304.D.1.f.ii. require that every application for an Arizona medical marijuana dispensary license contain a financial institution comfort letter that:

(1) Is from an in-state financial institution or an out-of-state financial institution;

(2) Is dated within 30 days before the date the dispensary registration certificate application was submitted; and

(3) Demonstrates that the entity applying for the dispensary registration certificate or a principal officer of the entity has at least $150,000 under the control of the entity or principal officer to begin operating the dispensary and has had control of the $150,000 for at least 30 days before the date the dispensary registration certificate application was submitted“