How to Open a Dispensary in Montana

Overview

Are you wondering how to open a cannabis dispensary in Montana? This page is dedicated to keeping you up-to-date on the latest news and relevant information to opening a cannabis business in Montana. This includes helpful insights on what is next to come for the state.

Cannabis is legal for both medical and recreational use in the state of Montana. Initiative 190 created legislation to legalize, regulate, and tax cannabis for individuals 21 and older. The ballot measure was approved by 56.9% of Montana voters in the 2020 Montana general election. 

After significant discussion, the state legislature eventually passed House Bill 701 in April 2021, which made certain changes to the voter-supported legalization legislation (I-190) and served as a framework for the execution of the program. In May 2021, Gov. Greg Gianforte signed the bill into law.

Starting January 1, 2022, adults 21 and older in Montana are allowed to buy cannabis from legal retail establishments. According to the Department of Revenue, Montana started the first month with $22.6 million in total cannabis sales, including approximately $12.9 million in recreational sales.

From January 1, 2022, through July 1, 2023, only existing Montana medical marijuana businesses are eligible to apply for and be awarded a recreational cannabis license in the state. Others who are interested in joining the industry will be able to apply after 18 months.

On May 22nd, 2023, Governor Greg Gianforte signed new laws passed by the Legislature, resulting in changes to Montana’s recreational marijuana program. HB 128 extends the moratorium on marijuana licenses for two years, clarifies rules for tribal participation, and allows certain medical-only businesses to join the recreational market. HB 903 increases licensing fees for providers with multiple dispensaries and includes provisions for businesses to transition from medical-only to adult-use sales.

The Opportunity Size

According to a report compiled by the University of Montana Bureau of Business and Economic Research, a 20 percent tax on legalized cannabis sales will generate between $43.4 and $52.0 million per year for Montana from 2022 to 2026. It is possible that the recreational cannabis industry could generate total revenues of between $217.2 and $259.8 million dollars over this four-year period.

Local Cannabis Restrictions & Laws

To date, 24 of Montana’s 51 counties have approved legalization authorizing recreational marijuana sale and use, and these counties are referred to as “green” counties. Cannabis may only be purchased by adults in Montana at stores located in these so-called “green counties,” which include Gallatin, Jefferson, Madison, and Park counties, among others.

The 27 counties who rejected recreational marijuana legalization are known as “red” counties. Adult-use cannabis sales are only permitted in red counties if a local vote has approved them. Meagher, Broadwater, and Beaverhead are among the counties that have been designated as red. Keep a watch out for developments in Rosebud, Jefferson, and Carbon counties, where a 50-49 vote in support of authorizing recreational marijuana recently occured.

In this section, we will keep you up-to-date on all the relevant changes in the 51 counties, in terms of their own stances, restrictions, and outright bans pertinent to recreational cannabis. Here‘s a map from the Cannabis Control Division showing the current red and green counties. 

Medical Marijuana

Cannabis was illegal in Montana until 2004, when voters approved legalization authorizing the sale and use of medicinal marijuana. Specifically, the Montana Medical Marijuana Allowance Initiative (I-148) was approved by nearly 62% of voters. This legalization allows people with very serious medical conditions to smoke marijuana.

In November 2016, the Montana Medical Marijuana Initiative (I-182), a proposal to relax the restrictions on the amount of medicinal cannabis that may be obtained and who can get it, was approved by a vote of 58 percent. In May 2017, Gov. Steve Bullock signed SB333, which significantly regulates the medicinal cannabis sector by requiring obligatory testing and seed-to-sale tracking, among other provisions.

According to the September 2021 dashboard report of the Cannabis Control Division, there are 54,785 enrolled medical marijuana cardholders in Montana. There are also 296 providers, 434 dispensaries, 222 marijuana infused product providers, and 5 lab licenses reported as of September 21, 2021. 

Medical Marijuana Business Opportunities

A vertically integrated business model characterizes Montana’s medicinal marijuana sector. This implies that a licensee is required to grow or produce all of the medicinal marijuana products that they want to sell. Neither wholesale nor processing are conducted between service providers.

Licenses are awarded to medical marijuana providers in Montana in the following categories:

• Canopy License
• Provider Location License
• Marijuana Infused Product Provider (MIPP) Location License
• Dispensary Location License
• Chemical Manufacturing Endorsement

Here’s the current information on the license application requirements and fees to start a Medicinal Marijuana Business in Montana.

Recreational Use Legalization

During the Montana general election in November 2020, Initiative 190 was on the ballot, and it was approved with a 56.9% vote, making adult-use marijuana legal in the state starting on January 1, 2021.

On May 18, 2021, Montana Governor Greg Gianforte approved the final plan for establishing recreational marijuana in the state. House Bill 701 contains certain changes to the voter-approved legislation, but it retains the majority of the original wording of Initiative 190.

And as it pertains to Montana Dispensaries:

• The Montana Department of Revenue is in charge of the administrative functions and responsibilities of the medical and adult-use marijuana programs.
• The department is authorized to accept applications and grant licenses for cannabis dispensaries and other cannabis facilities.
• Adult-use cannabis becomes available for purchase starting January 2022.

Requirements To Get a Cannabis Business License In Montana

Here is what we know so far when it comes to the requirements to open a dispensary or other type of cannabusiness in Montana.

Adult-Use Cannabis License Types

• Cultivation license – Enables the holder to cultivate marijuana. Licenses are provided in tiers, allowing for more cultivation area.
• Manufacturing Licenses – Enables the holder to convert or combine marijuana to produce marijuana products, concentrates, or extracts.

• Dispensary Licenses – Enables the holder to sell marijuana to registered cardholders and/or adult users.
• Transporter Licenses – Enables the holder to transport marijuana and marijuana products between licensed marijuana businesses.

• Testing Laboratory Licenses – Enables the holder to test representative samples of marijuana and marijuana products and report on their chemical components and potency.
• Combined-Use Licenses – Licenses for combined use were established for Montana’s eight federally recognized tribes and/or corporations majority controlled by one of those tribes. These permits include a cultivation and dispensary in the same location. 

Application Fees

• Cultivation license – $1,000 – $37,000 depending on Cultivation Canopy tier

• Manufacturing Licenses – $5,000 – $20,000 depending on tier

• Dispensary Licenses – $5,000 annual fee per location
• Transporter Licenses – $10,000 for a two-year period, $1,000 Storage Facility Endorsement Annually

• Testing Laboratory Licenses –  $5,000 Annually,  $1,000 Storage Facility Endorsement Annually

• Combined-Use Licenses –  Initial licensure and annual fees are $7,500 per year.

Application Required Documents:

• Date of Birth Documentation
• Montana Residency Documentation
• Fingerprint Consent
• Property Ownership or Owner Permission Documentation
• Business Organization Chart and Structure Form
• Verification of Funding Source
• Building and Fire Inspection Reports
• Approval by City and County

This page contains general licensing information that applies to all businesses applying for a cannabis license, regardless of the kind of license you are seeking.

As mentioned above, only medical marijuana licensees in Montana who were licensed on November 3, 2020 (or who were applying to DPHHS on that date) can get a license for adult-use marijuana from January 1, 2022, until July 1, 2023.

As the state’s cannabis program, especially the recreational program, grows in scope, we will keep you informed of any pertinent news and legislation regarding opening a dispensary in Montana. Simply by subscribing to our Montana Cannabis Mailing List (details below), we will keep you informed of any relevant news that matters, including hard-to-find news and opinions based on Montana Legalization.

This includes, but is not limited to, the following:

• How much does it cost to open a dispensary in Montana?
• How to get a marijuana business license and open a dispensary in Montana?
• What special programs will be available to those looking to participate in Montana’s cannabis industry?
• And more

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