5 Ways to Get Ahead in a Newly Legalized State
In our last article, we discussed how to get started with the cannabis licensing process. One suggestion was to research the application process in other states if you find yourself in a jurisdiction that hasn’t released its licensing process yet. In this article, we’ll cover how cannabis applicants can get ahead in a newly legalized state by discussing application requirements that are seen across the country.
Business Formation Documents
Expect to produce your business entity’s formation documents as part of the cannabis licensing process in any state. If you haven’t formed an entity to apply with, now is the time to consult with an attorney and/or tax professional to decide which type of entity makes the most sense.
As ironic as it may be given the high tax rates we see across the U.S., local jurisdictions often want to be assured that a business they grant a cannabis license to won’t go belly up shortly after it opens its doors. Therefore, expect to have to submit some semblance of a business plan.
A business plan in this context should show that a cannabis applicant is sufficiently capitalized and has a plan in place to reach profitability. At the very least, put a budget together to understand how much money you’ll need to see the application across the finish line.
Applicants should also expect to show that they have the legal right to occupy and use a property that is located in a cannabis-friendly zone. This is typically accomplished by providing an executed lease that specifically authorizes the commercial cannabis activity the applicant is applying for, or a deed if the applicant purchased the property.
Site and/or Floorplan
A site and/or floorplan that lays out all of the components of the cannabis operation will also be required. Be sure to request pre-existing diagrams from landlords or prior owners to save time and money.
An operations plan that is specific to the premises an applicant intends to operate in is another common cannabis application requirement. Some of the operating procedures to start thinking about include, but are not limited to:
- Quality Control
Every jurisdiction is going to have its own quirks, but once you submit enough cannabis applications, you begin to realize that there are a lot of similarities across the board. Putting the above items together ahead of time will make for a less stressful application process once the window opens.
© RYAN T. KOCOT, ESQ. 2021
DISCLAIMER: THIS INFORMATION IS STRICTLY EDUCATIONAL AND DOES NOT CONSTITUTE LEGAL ADVICE.
Great information Ryan 👍thanks!
Glad you enjoyed it, Kevin!