EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*hb0204*
HOUSE BILL 204
A3, C2 5lr0132
(PRE–FILED) CF SB 221
By: Chair, Economic Matters Committee (By Request – Maryland Cannabis
Administration)
Requested: October 7, 2024
Introduced and read first time: January 8, 2025
Assigned to: Economic Matters
A BILL ENTITLED
AN ACT concerning 1
Cannabis – Wholesaler License – Establishment 2
FOR the purpose of establishing a wholesaler cannabis license; altering a certain fee 3
limitation; and generally relating to wholesaler cannabis licenses. 4
BY repealing and reenacting, without amendments, 5
Article – Alcoholic Beverages and Cannabis 6
Section 36–101(a) and (jj) 7
Annotated Code of Maryland 8
(2024 Replacement Volume) 9
BY adding to 10
Article – Alcoholic Beverages and Cannabis 11
Section 36–101(kk) and 36–412 12
Annotated Code of Maryland 13
(2024 Replacement Volume) 14
BY repealing and reenacting, with amendments, 15
Article – Alcoholic Beverages and Cannabis 16
Section 36–101(kk), 36–401(d) and (e), 36–403(c) and (d), and 36–404(f) and (g)(1) 17
Annotated Code of Maryland 18
(2024 Replacement Volume) 19
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 20
That the Laws of Maryland read as follows: 21
Article – Alcoholic Beverages and Cannabis 22
36–101. 23 2 HOUSE BILL 204
(a) In this title the following words have the meanings indicated. 1
(jj) (1) “Usable cannabis” means the dried leaves and flowers of the cannabis 2
plant. 3
(2) “Usable cannabis” does not include seedlings, seeds, stems, stalks, or 4
roots of the plant or the weight of any noncannabis ingredients combined with cannabis, 5
such as ingredients added to prepare a topical administration. 6
(KK) “WHOLESALER” MEANS AN ENTITY LICE NSED UNDER THIS TITL E THAT 7
IS AUTHORIZED BY THE ADMINISTRATION TO ACQ UIRE, PURCHASE, STORE, 8
TRANSPORT, AND DISTRIBUTE CANNA BIS OR CANNABIS PROD UCTS BETWEEN OTHER 9
CANNABIS LICENSEES . 10
[(kk)] (LL) “Written certification” means a certification that: 11
(1) is issued by a certifying provider to a qualifying patient with whom the 12
provider has a bona fide provider–patient relationship; 13
(2) includes a written statement certifying that, in the certifying provider’s 14
professional opinion, after having completed an assessment of the patient’s medical history 15
and current medical condition, the patient has a condition: 16
(i) that meets the inclusion criteria and does not meet the exclusion 17
criteria of the certifying provider’s application; and 18
(ii) for which the potential benefits of the medical use of cannabis 19
would likely outweigh the health risks for the patient; and 20
(3) may include a written statement certifying that, in the certifying 21
provider’s professional opinion, a 30–day supply of medical cannabis would be inadequate 22
to meet the medical needs of the qualifying patient. 23
36–401. 24
(d) The Administration may not issue more than the following number of licenses 25
per type, including licenses converted under subsection (b)(1)(ii) of this section: 26
(1) for standard licenses: 27
(i) 75 grower licenses; 28
(ii) 100 processor licenses; and 29
(iii) 300 dispensary licenses; 30
HOUSE BILL 204 3
(2) for micro licenses: 1
(i) 100 grower licenses; 2
(ii) 100 processor licenses; and 3
(iii) 10 dispensary licenses; 4
(3) for incubator space licenses, 10 licenses; [and] 5
(4) for on–site consumption licenses, 50 licenses; AND 6
(5) FOR WHOLESALER LICEN SES, 15 LICENSES. 7
(e) (1) This subsection applies to all licenses, including licenses converted 8
under subsection (b)(1)(ii) of this section. 9
(2) Subject to paragraph (3) of this subsection, a person may have an 10
ownership interest in or control of, including the power to manage and operate: 11
(i) for standard licenses and micro licenses: 12
1. one grower licensee; 13
2. one processor licensee; and 14
3. not more than four dispensary licensees; 15
(ii) for incubator space licenses, not more than two licensees; [and] 16
(iii) for on–site consumption licenses, not more than two licensees; 17
AND 18
(IV) FOR WHOLESALER LICEN SES, NOT MORE THAN ONE 19
LICENSEE. 20
(3) (i) A person who owns or controls an incubator space licensee [or], 21
an on–site consumption licensee, OR A WHOLESALER LICE NSEE may not own or control 22
any cannabis licensee listed under paragraph (2)(i) of this subsection. 23
(ii) The Administration shall adopt regulations limiting a person or 24
fund from acquiring a nonmajority ownership interest in multiple cannabis businesses 25
beyond the limitations established under this subsection. 26
(4) The restrictions in paragraph (2) of this subsection do not apply to a 27
person or an entity who holds an ownership interest only as a passive investor. 28 4 HOUSE BILL 204
36–403. 1
(c) (1) This subsection applies only to an applicant applying for a cannabis 2
license under § 36–404 of this subtitle. 3
(2) An applicant for a standard license, an incubator space license, [or] an 4
on–site consumption license, OR A WHOLESALER LICE NSE shall pay an application fee of 5
$5,000. 6
(3) An applicant for a micro license shall pay an application fee of $1,000. 7
(d) (1) Subject to paragraphs (2) and (3) of this subsection, the Administration 8
shall establish licensing and renewal fees for all cannabis licenses. 9
(2) Except as provided in paragraph (3) of this subsection, the licensing and 10
renewal fees established under paragraph (1) of this subsection for [standard] cannabis 11
licensees may not exceed: 12
(i) for initial license fees, $50,000; and 13
(ii) for renewal license fees, the lesser of 10% of the [standard] 14
cannabis licensee’s annual gross revenue or $50,000. 15
(3) The Administration shall reduce licensing and renewal fees by at least 16
50% for social equity licenses, micro licenses, incubator space licenses, WHOLESALER 17
LICENSES, and on–site consumption licenses. 18
36–404. 19
(f) (1) Subject to paragraph (2) of this subsection, if the Administration, in 20
consultation with the certification agency designated by the Board of Public Works under 21
§ 14–303(b) of the State Finance and Procurement Article, the Governor’s Office of Small, 22
Minority, and Women Business Affairs, the General Assembly, and the Office of the 23
Attorney General, determines that a disparity study demonstrates a strong basis in 24
evidence of business discrimination against firms owned by minorities and women in the 25
Maryland cannabis market, the Administration shall issue a second round of licenses, 26
applying minimum licensing qualifications and employing remedial measures consistent 27
with constitutional requirements, for not more than: 28
(i) for standard licenses: 29
1. 25 grower licenses; 30
2. 25 processor licenses; and 31
HOUSE BILL 204 5
3. 120 dispensary licenses; 1
(ii) for micro licenses: 2
1. 70 grower licenses; and 3
2. 70 processor licenses; 4
(iii) 10 incubator space licenses; [and] 5
(iv) 15 on–site consumption licenses; AND 6
(V) 10 WHOLESALER LICENSES . 7
(2) If the Administration, in consultation with the certification agency 8
designated by the Board of Public Works under § 14–303(b) of the State Finance and 9
Procurement Article, the Governor’s Office of Small, Minority, and Women Business 10
Affairs, the General Assembly, and the Office of the Attorney General, determines that a 11
lottery system employing remedial measures established in accordance with a disparity 12
study can be conducted consistent with constitutional requirements, the Administration 13
shall award licenses under paragraph (1) of this subsection through a lottery process that 14
employs remedial measures. 15
(g) (1) Subject to paragraphs (2) and (3) of this subsection, if the 16
Administration, in consultation with the certification agency designated by the Board of 17
Public Works under § 14–303(b) of the State Finance and Procurement Article, the 18
Governor’s Office of Small, Minority, and Women Business Affairs, the General Assembly, 19
and the Office of the Attorney General, determines that a disparity study does not 20
demonstrate a strong basis in evidence of business discrimination against firms owned by 21
minorities and women in the Maryland cannabis market, the Administration shall enter 22
each applicant that meets the minimum qualifications established by the Administration 23
into a lottery and issue to the applicants not more than: 24
(i) for standard licenses: 25
1. 25 grower licenses; 26
2. 25 processor licenses; and 27
3. 120 dispensary licenses; 28
(ii) for micro licenses: 29
1. 70 grower licenses; and 30
2. 70 processor licenses; 31
6 HOUSE BILL 204
(iii) 10 incubator space licenses; [and] 1
(iv) 15 on–site consumption licenses; AND 2
(V) 10 WHOLESALER LICENSES . 3
36–412. 4
(A) THE ADMINISTRATION MAY IS SUE WHOLESALER LICEN SES 5
AUTHORIZING AN ENTIT Y TO OPERATE A LICEN SED PREMISES WHERE C ANNABIS OR 6
CANNABIS PRODUCTS MA Y BE STORED SECURELY . 7
(B) A WHOLESALER MAY : 8
(1) PURCHASE CANNABIS OR CANNABIS PRODUCTS FR OM OTHER 9
LICENSED OR REGISTERED ENTITIES ; 10
(2) SECURELY STORE CANNA BIS OR CANNABIS PROD UCTS 11
INDEPENDENTLY OR ON BEHALF OF OTHER CANN ABIS LICENSEES; AND 12
(3) TRANSPORT OR DISTRIB UTE CANNABIS OR CANN ABIS PRODUCTS 13
TO OTHER CANNABIS LI CENSEES OR TO INDEPE NDENT TESTING LABORA TORIES. 14
(C) A WHOLESALER MAY NOT : 15
(1) CONDUCT ANY ACTIVITY THAT WOULD REQUIRE A N ADDITIONAL 16
LICENSE UNDER THIS T ITLE, INCLUDING GROWING , PROCESSING, DISPENSING, OR 17
INCUBATING CANNABIS ; 18
(2) TRANSFORM OR REPACKA GE CANNABIS OR CANNA BIS PRODUCTS; 19
(3) PROVIDE CANNABIS OR CANNABIS PRODUCTS DI RECTLY TO 20
CONSUMERS ; 21
(4) IMPORT CANNABIS INTO THE STATE; OR 22
(5) EXPORT CANNABIS OUT OF THE STATE. 23
(D) THE ADMINISTRATION MAY AD OPT REGULATIONS TO I MPLEMENT THIS 24
SECTION, INCLUDING THE WHOLES ALER REQUIREMENTS FOR: 25
(1) THE SAFE STORAGE OF CANNABIS AND CANNABI S PRODUCTS; 26
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(2) PRODUCT TESTING AND PACKAGING AND LABELI NG COMPLIANCE ; 1
AND 2
(3) ENSURING AN EQUITABL E CANNABIS MARKET IN THE STATE. 3
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 4
1, 2025. 5