South Dakota Committee Approves Increasing Medical Marijuana License Fees by $4,000

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South Dakota’s Legislative Rules Review Committee has approved a significant increase in the annual fee for medical marijuana business licenses.

By a vote of 4 to 1, the committee agreed to raise the fee by nearly $4,000, bringing the total annual cost to $9,000. This move comes in response to the state’s rapidly growing number of medical marijuana cardholders, which has far surpassed initial projections. While the state anticipated 6,000 cardholders by 2024, there were approximately 13,000 as of July.

The Department of Health (DOH) requested the fee increase to amend a 2021 law that originally set the fee at $5,310. Emily Kerr, Program Administrator for the DOH Medical Cannabis Program, explained that the additional funds are necessary to meet the department’s legal obligations, which include the thorough review of applications, providing technical guidance, customer service, and conducting inspections.

“These responsibilities require sufficient manpower and resources to ensure we can properly implement and enforce state law and administrative rules,” said Kerr.

As of July, the state had 68 certified dispensaries, 35 cultivation sites, 18 manufacturing facilities, and 2 independent testing labs in operation. The DOH estimates that the new fee structure will generate nearly $350,000 in the next year and close to $500,000 the following year, which will support the department’s regulatory efforts.

The rule change does not affect fees for medical marijuana cardholders.

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