The Division of Cannabis Regulation (DCR) announced that the next round of microbusiness applications will be accepted through the online registry portal from April 15 to 29. DCR continues to develop guidance and communication to support those interested in applying for a microbusiness license, including cautionary information about predatory practices that often follow this type of licensing opportunity, both in Missouri and other states.
First, pursuant to 19 CSR 100-1.020(1)(A), DCR is granting a variance to microbusiness applicants for the submission of fingerprints for the upcoming round of application submission. The fingerprint requirements for applicants, as outlined in 19 CSR 100-1.060(3)(K), can be met by the submission of fingerprints at a later date. The microbusiness fingerprint variance can be found here.
Second, DCR will be adding additional licenses to the constitutionally required 48 microbusiness licenses due to the revocation of nine licenses from the first round of microbusiness licensing. In round two, DCR will award one additional microbusiness wholesale license and eight additional microbusiness dispensary licenses.
Third, Article XIV of the Missouri Constitution requires that majority owners of microbusiness licenses meet certain qualifications to be eligible. The clear intent is that a microbusiness license should provide a path to facility ownership for individuals who might not otherwise easily access that opportunity. DCR has previously published guidance regarding microbusiness facility ownership.
DCR has become aware of solicitation efforts by companies to apply for microbusiness licenses on behalf of qualified individuals with promises of future ownership of the license. Eligible individuals should exercise caution in accepting such arrangements as some of the solicitations may be predatory in nature – using individuals’ identifying information and circumstances to acquire a license with no agreements in place that would result in the eligible individuals being the owners of the license.
Examples of behaviors that may indicate predatory arrangements include:
- Applicants are promised a 51% ownership stake of the license and a fair market value buyout for that 51%.
- Applicants are promised a payment when the license is initially issued, then receive a salary for 3-5 years that is equal to the remaining 51% of the license value or some other payment arrangement.
- The solicitor does not ask for any payment and offers to pay for upfront application and business costs.
- The solicitor informs the potential applicant that if they want to own and operate an awarded license, they should apply on their own.
- The solicitor promises they will provide their own money, resources, and time to run the day-to-day business operations so that the applicant owner does not need to invest their own money, resources, or time.
Article XIV is clear that the microbusiness licenses must be owned and operated by eligible individuals. A purported owner with little to no knowledge, control, agency, or decision-making authority in an application or license does not meet the intent or meaning of the requirement in Article XIV.
Finally, potential applicants should be advised that a change of ownership of a microbusiness license is subject to DCR review and approval before taking effect, and any new individual who contributes to majority ownership must meet eligibility criteria.
DCR continues to provide information to assist individuals interested in applying for a microbusiness license in Missouri. Visit Cannabis.mo.gov to review recent updates including new and revised frequently asked questions, updated microbusiness qualifying poverty and unemployment census tracts, new microbusiness tutorials, and an option to register for the email list that is used to distribute updates on licensee information, microbusiness news, patient information, and the DCR newsletter, The Cannabis Connection.
Those needing assistance with eligibility requirements or application forms can contact Facility Application Services at [email protected].
