State regulators in Ohio recognize that proposed licensing fees for medical marijuana businesses could initially surpass the state’s costs of running the program.
The program is requested approximately $2.5 million a year for operational costs in each of the next two years. That doesn’t comprise several unknown costs, including preparing the program’s licensing, product tracking and payment systems and creating a necessary toll-free hotline.
In the event the state issues all of the licenses it’s making accessible — 24 to cultivators, 40 to product processors and 60 to dispensaries — fees as proposed would create $10.8 million. The state has also made application fees for the licenses non-refundable.
Several advisers pushed back against the notion that fees may be overly high.
Ohio’s medical marijuana law went into effect in June, with a goal date to be operating on September 2018. It enables people with 21 medical conditions, including cancer, Alzheimer’s disease, AIDS and epilepsy, to buy and use marijuana after acquiring a physician’s recommendation. The law doesn’t permit smoking.
Ohio has set one of the highest fees of any medical marijuana state: a $20,000 application fee and $180,000 license fee for bigger growers, and a $2,000 application fee and $18,000 license fee for smaller growers.
Some guesswork is involved in setting up a brand new program, but that having excessive revenue is better than being underfinanced. The high fees will weed out those businesses which may not be placed to endure.
Anticipated expenses for the medical marijuana program comprise the following:
— About $845,000 for 10 positions at the Ohio State Board of Pharmacy;
— About $690,000 for 7 positions at the Department of Commerce;
— $611,500 for Pharmacy and $428,000 for Commerce for office overhead, travel and training;
— $175,000 for operation of the patient registry.
Chris Lindsey, senior legislative counsel for the Marijuana Policy Project, medical marijuana programs in the Midwest and the East have put more emphasis on fees than those in the West. Most claim that the fees are “reasonably related” to offsetting the expenses of operating the program.
“The fees for these kinds of program shouldn’t be money-makers for the programs, and I don’t think states typically look at them like that,” he said.