More than 1,000 medical marijuana business applications flood Kentucky

After receiving only 28 license applications from businesses in July, the Kentucky Office of Medical Cannabis received more than 700 in the first few days of this week, surging just ahead of the deadline to submit them.

Kentucky has now received more than 1,000 applications for businesses seeking a license to operate as either a medical marijuana dispensary, cultivator, processor or safety compliance facility.

This number is likely to grow significantly ahead of the application deadline of midnight on Saturday.

Dispensaries are allowed to start selling cannabis products to qualified patients starting Jan. 1 next year . Licenses for cannabis businesses will be awarded in October, following a lottery of applicants conducted by the state.

The large majority of applications submitted so far are for dispensary licenses, with the state receiving 860 as of Wednesday evening.

Under the new state regulations, a maximum of 48 dispensary licenses will be given to businesses, including at least four within the 11 licensing regions of the state. Jefferson and Fayette counties will each have two dispensary licencees, while no other county may have more than one.

The regions containing Jefferson and Fayette have received far more dispensary license applications than any other region, at 331.

In the Kentuckiana region — including Louisville and Oldham, Shelby, Bullitt, Spencer, Henry and Trimble counties — 153 dispensary applications were submitted, with 102 of those in Jefferson County.

The most dispensary applications were submitted in the Bluegrass region, including Fayette and 12 surrounding counties. The region had 178 applications there as of Wednesday night, with 81 in Fayette County.

The lowest number of dispensary applications for a region was 13 in the Mountain region, which includes 18 counties in eastern Kentucky.

As of Wednesday night, there were 151 applications submitted to be a licensed cultivator of medical marijuana.

The cultivator applications are split between three tiers, with the first for an indoor area less than 2,500 square feet, second for an indoor area less than 10,000 square feet, and the third for an indoor area less than 25,000 square feet.

There were 59 applications submitted for Tier 1, 62 submitted for Tier 3 and 34 submitted for Tier 3. State regulations cap the maximum number of licenses for each tier at 10, 4 and 2, respectively.

Hopkins County had the most cultivator applications, with 22.

Under the state law passed last year, no licensed cultivator is allowed to grow marijuana on outdoor farms, a feature that some in the industry believed could limit local farmers and businesses from seeking a license or being profitable.

There were also 58 applications submitted by Wednesday evening from businesses seeking a processor license, which would allow them to process the plants so they are available to be sold in different forms at dispensaries. State regulations allow a maximum of 10 processor licenses.

Dispensaries can sell medical cannabis as edibles, oils, tinctures, vapes and raw plant material, though state law prohibits it from being smoked.

There have also been three applications submitted by businesses to receive a safety compliance facility license, the number of which the state will not cap. These three applicants are in Louisville, Lexington and Nicholasville.

Local governments can prohibit medical cannabis businesses from operating in their jurisdiction through either passing an ordinance by the end of the year or putting the question to voters in a ballot referendum.

Cities and counties making up roughly 12% of the population have already passed ordinances banning such businesses. More than 100 counties and cities will also have a ballot referendum in November , with these areas making up 29% of Kentucky’s total population.

State law requires that no medical cannabis businesses are allowed within 1,000 feet of a K-12 school or daycare, though local governments can make additional zoning rules. Louisville Metro Government considered adding more restrictive zoning rules , though Metro Council ultimately passed rules closely resembling state law .

Business applicants must also submit an application free and show that they have enough capital for each proposed license.

Each dispensary and processor application must show $150,000 of capital and pay a $5,000 application fee.

The Tier 1, 2 and 3 cultivator applicants must show $50,000, $200,000 and $500,000 of capital and pay application fees of $3,000, $10,000 and $20,000, respectively.

If each of these 1,076 applicants did pay the application fee, that would amount to more than $6 million for the state.

Additional fees of a greater amount would also have to be paid by the applicants who receive a license after the state lottery is conducted in October.

Clarification: A previous version of this story noted that Nicholasville's city council passed an ordinance to ban medical marijuana businesses, but the council voted for another ordinance this week to allow them.

State government and politics reporting is supported in part by the Corporation for Public Broadcasting.