The Arizona Department of Health Services (ADHS) unveiled its second draft of medical marijuana rules on Jan. 31, with changes that include a two-part process for dispensary applicants and a proposal for the process as to where to locate dispensaries within the state.
The draft proposes a two-part application process that would let applicants know if they qualify to open a dispensary before paying all application fees. First, applicants would apply for a registration certificate that would involve a background check and some basic information. If the applicant is approved for the registration certificate, then the applicant would apply for an operator’s license, which would require a more in depth application seeking specific information pertaining to the operation of the dispensary itself.
The rule stating that dispensaries would need to grow at least 70 percent of the marijuana, and could not sell or purchase more than 30 percent was removed. Instead, the draft proposes policies for tracking, packaging, accepting and acquiring marijuana from patients and other dispensaries.
The new proposal also suggests one dispensary be located in each Community Health Analysis Area (CHAA). These are areas in the state used by ADHS to analyze data for various disease monitoring programs. CHAA was developed by the Arizona Department of Health (ADHS) in 2005 as a way to collect information according to public-health statistics. The areas divide the state into 126 areas, a number very close to the number of dispensaries that will be allowed.
While Holbrook and Winslow are each designated areas, so far only Winslow has had a potential applicant contact city officials expressing an interest in opening a dispensary there.
In a related matter, Arizona Attorney General Tom Horne has proposed that medical marijuana sold at dispensaries should be subject to sales tax.
Prescriptions issued in the state cannot be taxed, but the language of the act purposely avoids the word “prescription” when discussing medical marijuana, instead using the phrase “written certifications.” According to Horne, this means the item can be taxed the same as any other item purchased by a consumer. He also stated that Department of Revenue officials informed his office that they plan to take his advice and tax the sales.
If taxed, it is estimated that the state could receive as much as $40 million in revenues annually from medical marijuana sales. This would mean that cities will also be able to tax the purchases of medical marijuana made at local dispensaries.
The ADHS will be holding four public meetings about the draft rules, with the nearest one scheduled from 10 a.m. to 1 p.m. on Monday, Feb. 14, at the Flagstaff City Hall, Council Chambers, located at 211 W. Aspen Ave.
The final draft is expected to be completed for publication by March 28, and it is expected that dispensaries will be able to open throughout the state beginning this summer.
