Texas Dispensary License Application

Ready to open a medical cannabis dispensary in Texas? You must first complete the complex Texas dispensary License Application. The Lone Star State lawmakers just recently passed legislation (House Bill 1365) that will allow the sale of medicinal marijuana. But getting your Texas dispensary license is no easy feat – not only do you have to meet certain qualifications, but you’ll also have to fill out and submit a lengthy application as well. Luckily, we’ve got all the information needed for entrepreneurs who are interested in pursuing this opportunity. Follow this guide to ensure a successful Texas Dispensary License Application process!

Applying  a Dispensary License in Texas

One must complete and electronically submit an application here. Together with the application, one must attach the exhibit  requirements found below:

Application Exhibit Requirements

Exhibit A – Ownership documentation TAC §12.11(b)(1) 

Proof of ownership and current status, including but not limited to a current Certificate of Existence or Certificate of Authority from the Texas Office of the Secretary of State and a Certificate of Good Standing from the Texas Comptroller of Public Accounts. 

Exhibit B – Proof of required liability insurance TAC §12.11(b)(6) 

A certificate of insurance as proof of commercial general liability insurance coverage against claims of liability for damage to property of third parties and for personal injuries to third parties, including bodily injury, property damage, and product liability, with limits of: 

1. a) $1,000,000 each occurrence. 
2. b) $2,000,000 General Aggregate limit. 
3. c) $1,000,000 Product Liability. 

If a certificate of insurance is not available at the time of application, a letter of intent to obtain required insurance may be submitted. Prior to final approval of a license, applicants will be required to provide a valid certificate of insurance.

Exhibit C – Proof of the ability to secure the premises, resources, and employees necessary to operate as a dispensing organization TAC §12.11(b)(7)(B) 

All Texas dispensary applications must provide demonstration of compliance on this exhibit for the following:

1. Descriptions of all property’s applicant proposes to utilize to cultivate, process, and dispense low- THC cannabis, including ownership information for the properties. 
2. Descriptions of the methods proposed for the cultivation, processing, and dispensing of low THC cannabis. 
3. Descriptions of the types and locations of worker safety equipment and plans and procedures for complying with federal Occupational Safety and Health Administration (OSHA) regulations for workplace safety. 
4. A list of current and proposed staff, including, position, duties and responsibilities, and an organizational chart illustrating the supervisory structure of the dispensing organization. 
5. Description of the applicant’s proposed testing laboratory, and description of the proposed testing protocols and methods. 
6. A proposal establishing the ability to secure premises reasonably located to allow patient access through existing infrastructure. 

Exhibit D – Proof of the ability to maintain accountability of all raw materials, finished products, and any by products to prevent diversion or unlawful access to or possession of these substances TAC §12.11(b)(7)(C) 

Diversion prevention has a place near the heart of regulated cannabis. Diversion means that your supply goes from legal channels to non-licensed channels. A Texas Dispensary License Application contains an Exhibit D that requires demonstration by the applicant of the following:

1. Floor plan of each facility or proposed floor plans for proposed facilities, including: 
   1. Locking options for all means of ingress and egress consistent with life safety requirements. 
   2.  Alarm systems. 
   3. Video surveillance. 
   4. Name, layout and function of each room; and e. Storage, including safes and vaults. 
2. Diversion prevention procedures. 
3. Emergency management plan. 
4. System for tracking source plant material throughout cultivation, processing, and dispensing. 
5. Inventory control system as required by Title 37, TAC §12.8. 
6. Policies and procedures for recordkeeping. 
7. Electronic vehicle tracking systems. 
8. Vehicle security systems. 
9. Methods of screening and monitoring employees. 
10. Employee qualifications and experience with chain of custody or other tracking mechanisms. 
11. Waste disposal plan. 
12. Recall procedures for any product that has a reasonable probability of causing adverse health consequences based on a testing result, patient reaction, or other reason. 
13. Access to specialized resources or expertise regarding data collection, security, and tracking. 

Exhibit E Proof of the financial ability to maintain operations for two (2) years from the date of application TAC §12.11(b)(7)(E) 

1. Description of applicant’s business organization, and corporate structure if applicable. 
2. List of all owners of any non-corporate applicant, or all shareholders of a corporate applicant. 
3. List of all individuals and entities with control over the applicant. 
4. Projected two (2) year budget. 
5. Description of available assets sufficient to support the dispensing organization activities. 

Exhibit F Proof of the technical and technological ability to cultivate, process, and/or dispense low-THC cannabis, evidenced by experience in the areas listed below TAC §12.11(b)(7)(A) 

1. Cultivation, analytical organic chemistry and micro-biology; and analytical laboratory methods. 
2. Patient education and interaction, and the handling of confidential information including familiarity with the requirements of the Health Insurance Portability and Accountability Act (HIPAA) 

Exhibit G Proof of infrastructure reasonably located to dispense low-THC cannabis to registered patients TAC §12.11(b)(7)(D) 

1. Map showing the location of the applicant’s proposed dispensing facilities with streets; property lines. buildings; parking areas; outdoor areas, if applicable; fences; security features; fire hydrants, if applicable; and access to water and sanitation systems. 
2. Floor plan of the actual or proposed building or buildings where dispensing activities will occur showing areas designed to protect patient privacy and areas designed for retail sales, with proposed hours of operation. 
3. Detailed description of HIPAA compliant computer network utilized by all facilities. 
4. Identifying descriptions of any vehicles to be used to transport product. 
5. Description of all communication systems. 

Exhibit H Project Schedule and Plan 

1. A plan detailing how the applicant would stand up operations if licensed including timelines, deliverables, milestones, and projected date for filling prescriptions. 
2. The plan must also identify how the applicant would provide statewide coverage for patients.

Fees and Deadlines

According to the Texas DPS website, the application is detailed to filling out the documents and submitting to an online portal with a $7,356 fee to the Comptroller via wire transfer. The application period ends at 5 p.m. On April 28, CST.

At a later date, an announcement will be made outlining the application acceptance process and the subsequent approval process for issuing additional licenses. Only the number of licenses required to ensure reasonable statewide access to and availability of low-THC cannabis for patients on the compassionate-use registry will be issued by the department.

For more details or to download the application, visit the Texas DPS dispensing organization licensing website. 

Now that you know how to apply for a dispensary license in Texas, it’s time to get started on your own application. Remember to review the requirements and make sure you have everything in order before submission. Good luck!