The Five Biggest Changes in Pennsylvania’s Medical Marijuana Application

The marijuana consultants at Quantum 9 have put together a comprehensive list of all the changes between Pennsylvania’s Medical Marijuana Application, Attachments, and Instructions. The five biggest changes are listed below, a word by word comprehensive overview of all three documents are listed thereafter. Here is the link to the Pennsylvania Medical Marijuana Site: https://www.pa.gov/guides/pennsylvania-medical-marijuana-program/

Number 1 – Edibility of the Application: Right out of the gate, the document is editable vs. last time where you would have to break the document using software like Adobe X to convert to a Word document. This affects you when you go to cut in the answers of the sections into the actual application. In most cases, you will perform the work in a separate document or online repository, when this process happens many applicants were not aware of how to break the file, problem solved.

Number 2 – Scoring: The scoring has changed a little. The operation plan is worth 125 for grower/ processors and dispensaries, it is more important than ever to bring you’re A Game to answer all the questions with marijuana consultant’s expert protocols, procedures, and unique differentiating points.

Within the Grower/ Processor Scoring Matrix the following changes were made:

  1. Operational Timetable changed from 50 to 75
  2. Grow Practice changed from 50 to 100
  3. Processing and Extraction changed from 50 to 100
  4. Quality control and Testing for Potential Contamination changed from 50 to a check mark.

Within the Dispensary Scoring Matrix the following changes were made:

  1. Operational Timetable changed from 50 to 75
  2. Transportation of Medical Marijuana changed from 25 to 50
  3. Storage of Medical Marijuana changed from 50 to 75
  4. Labeling of Medical Marijuana Products from 25 to a check mark
  5. Inventory Management changed from 50 to 75
  6. Recordkeeping changed from 50 to 75
  7. Capital Requirements changed from 50 to a check mark ­
  8. Personal Identification changed from 50 to a check mark ­

Number 3 – Diversity: Within the instructions, there is an entirely new scoring matrix to get the highest possible scores for Diversity. This can be found on page 15 of the Instructions. 75 points will be awarded to applicants that demonstrate an exemplary commitment to diversity. An additional 25 points will be awarded to Equal Opportunity and Access in Contracting. Basically, your spend with diverse partners that are “certified by a third-party certifying organization or that have been verified by the Department of General Services Bureau of Diversity, Inclusion and Small Business Opportunities” can earn you an additional 25 points.

Number 4- Community Benefits: The State has provided an entirely new scoring matrix for Community Benefits. Since the diversity and community benefits sections were the largest areas applicants lost points, the Department of Health has provided a scoring matrix to give applicants further clarity on what is the most important. This matrix can be found on page 18 of the instructions. The other giant change is the “financial depressed areas”, this check box and section was moved to the community benefits section and a list of Act 47 locations were listed. The list of Act 47 locations can be found on page 21 of the instructions. The Site Location is now worth 40 total points. Job Creation is worth 20, Need for Economic Development is worth 15 points and Priority Points are worth 25, this includes things like charitable giving, community events, University-community partnerships, job training in the medical marijuana field, and the existence of a Labor Peace Agreement.

Number 5 – Personal Identification and Capital Requirements – Attachment E – Personal Identification was worth 50 points in round one and are worth nothing in round 2. These points were moved to the operating plan section. Section 22 Capital Requirements were 50 points in round 1 and are now simply a check mark. These points were also moved to the Plan of Operations section.

Number 6 – Background checks – The state is now using IdentoGo to do digital background checks the following codes are used, you must pre-enroll for this system.

  • Financial Backer – 1KG8GT
  • Employee – 1KG8JR
  • Operator- 1KG8H7
  • Principal – 1KG8F9

If you are still looking for a cannabis consulting to help with your plan of operations section, please feel free to fill out the form at the bottom of this blog post or to email us at info@quantum9.net

Below is a comprehensive review side by side of the Medical Marijuana Application, Attachments and Instructions.

Pennsylvania’s Medical Marijuana Round One Application vs Round Two Application

Section 1 – Applicant Identification and Facility Information

The Department of Health added this above the primary contact section instead of a checkbox for Primary Contact or Registered Agent (Please note: If an initial permit fee needs to be refunded, the check will be made payable to the business name provided above, in care of the primary contact, at the primary contact’s mailing address provided below.)

Section 2 – Facility Information

In the second round, the Department of Health removed the Yes/ No checkbox for “Is the facility located in an economically depressed municipality?” as well as the Yes/ No checkbox for “Does the facility have an excess maintenance agreement or road use agreement with PennDOT, the local municipality, or the county?” They removed the economically depressed check box and moved it to the community benefits section and Act 47 areas are listed on the last page of the instructions.

Part B – Diversity Plan

In the overview section, the Department of Health clearly defines diverse participants by removing the term “including a natural person… corporation, partnership association, trust or other entity, or any combination thereof” the Department of Health add that the diverse group “have been certified by a third-party certifying organization or that have been verified by the Department of General Services Bureau of Diversity, Inclusion and Small Business Opportunities
In the explanation section, they fixed the term “accorded to afforded”

Explanation point 4 changed from “will conduct during the term of the permit” to “conduct to support its diversity goals in ownership, management, and employment

Removed point 5. “Contracts with diverse groups and the expected percentage and dollar amount of revenues that will be paid to the diverse groups.” This was a huge add, this was our secret weapon on how we scored higher in phase I. they moved it to the scoring section and assigned 25 points to it.

The Department has added the following to the answer overview Indicate the total percentage of revenues that the Medical Marijuana Organization will pay to Diverse Groups as contractors of the Medical Marijuana Organization for the full permit term.  The percentage of revenues will be used to calculate a score for Equal opportunity and access in contracting as detailed in the Medical Marijuana Permit Application – Diversity Plan Scoring Matrix. 

List the total anticipated dollar amount of those revenues to be paid to Diverse Groups as contractors of the Medical Marijuana Organization for the full permit term.

 Provide the name of each Diverse Group and a valid certificate issued by a third-party certifying organization (Unified Certification Program (UCP), Woman’s Business Enterprise National Council (WBENC), National Minority Supplier Development Council (NMSDC), United States Small Business Administration (SBA) 8(a) Program, or Vets First Verification Program (vetbiz.gov)) or a valid Small Diverse Business verification issued by the Department of General Services, Bureau of Diversity, Inclusion and Small Business Opportunities to demonstrate the entity is a Diverse Group.  Provide the percentage of revenues the Medical Marijuana Organization will pay to each Diverse Group and the total anticipated dollar amount of revenues the Medical Marijuana Organization will pay to each Diverse Group.  A Medical Marijuana Organization will only receive points in this section for the percentage of revenues it will pay to entities with proof of Diverse Group status provided with the application.

Points for this section will be based on the following formula:

Total percentage of revenues that the Medical Marijuana Organization will pay to Diverse Groups as contractors ÷ 4 = Equal Opportunity and Access in Contracting score.

Part C – Applicant Information – removed the term “backgrounds” in round two’s application vs round 1’s application.

Section 4 – Principals, Financial Backers, Operators, and Employees – Identical

Section 5 – Moral Affirmation – Identical

Section 6 – Compliance with Applicable Laws and Regulations – Identical

Section 7 – Civil and Administrative Action – Identical

Part D – Plan of Operation – Huge Change Here – changed the points for this section from 550 points to 675 points.

The Department added the term “temporary” to describe the regulations in the explanation.

Section 8 – Operational Timetable – Identical

Section 9 – Employee Qualifications, Description of Duties and Training A. B. and C. – Identical

Section 10 – Security and Surveillance – Identical

Section 11 – Transportation of Medical Marijuana – Added the “temporary” to describe the regulations. Questions checkboxes are identical.

Section 12 – Storage of Medical Marijuana – Identical

Section 13 – Packaging and Labeling of Medical Marijuana – Identical

Section 14 – Inventory Management – Changed

  1. They added “By checking “yes” you acknowledge the obligation to use the electronic tracking system…”
  2. Checkboxes are – Identical

Section 15 – Management and Disposal of Medical Marijuana Waste – Identical

Section 16 – Diversion Prevention – Identical

They added “By checking “yes” you acknowledge that you… 

Section 17 – Grower Practice – Identical

 Section 18 – Nutrient and Additive Practices – Identical

Section 19 – Processing and Extraction – Identical

Section 20 – Sanitation and Safety – Identical

Section 21 – Quality Control and Testing for Potential Contamination – Identical

 Section 22 – Recordkeeping – Identical

Part E – Application Organization, Ownership, Capital, and Tax Status Huge Change Here – In Round 1 there were 150 points and 75 points in round 2 – the 75 points from here were moved to the Part D – Operational Plan

In the Federal Employer ID number box, “a refund cannot be processed without the applicant

Section 24 – Business History and Capacity to Operate – Identical

Section 25 – Current Officers – Identical

Section 26 – Ownership –

At the very bottom of the section, there was a small change the name of the document changed to “Other Persons Holding an Interest (Contd.)”

Section 27 – Capital Requirements –  answer summary changed from “Provide a summary of your available capital and an estimate spending plan to be used for you to become operational within six months from the date of the issuance of the permit:” to “Provide an estimated spending plan to be used for you to become operational within six months from the date of the issuance of the permit:” they removed “provide a summary of available capital.”

Section 28 – Community Impact – They added this to the answer overview section – “PLEASE REFER TO THE PERMIT APPLICATION INSTRUCTIONS FOR THE COMMUNITY IMPACT SCORING MATRIX.”

Differences between Pennsylvania Round One Application Attachments vs Round Two Application Attachments

Attachment A: Signature Page

Removed the term “and all other attachments.” in the first line under instructions.

In the fourth bullet, the Department of Health removed the term “and all other attachments.” 

In the “Application:” section they added the following check boxes, Redacted Application, Written statement signed by an applicant representative stating that all redactions made by the applicant constitute trade secret or confidential proprietary information as defined under the Right-to-Know Law

In the “Other Attachments:” Section in the checkbox Attachment J they added “(for Grower/Processor applicants only)

In the “Additional Attachments:” section they added the term “electronic” to describe all documents.

Attachment B: Organizational Documents – Identical

 Attachment C: Property Title, Lease, or Option to Acquire Property Location – Identical

Attachment D: Site and Facility Plan – Identical

Attachment E: Personal Identification – The Department of Health added a few items to bullet 2. A verification of identity satisfactory to the Department, including but not limited to the following forms of verification of identity: In each bullet, they added the term valid and “unexpired” to each item. Added a note “Please note: Personal identification only needs to be supplied once for each individual, regardless of whether the individual serves in multiple capacities, such as owner and principal”

Attachment F: Affidavit of Business History – added a new bullet two “Please note: The Department will accept individual affidavits from each principal, operator, financial backer and employee or one affidavit signed by a principal or operator that includes every principal, operator, financial backer, and employee

Updated the paragraph above the chart to “During the 10 years preceding the submission date of the initial permit application, the following principal(s), operator(s), financial backer(s) and employee(s),  have held a position of management or ownership of a controlling interest in any other business in this Commonwealth or any other jurisdiction involving the manufacturing or distribution of medical marijuana or a controlled substance”

Replaced the term “the filing date of the initial permit application” to “submission date of the initial permit application”

Attachment G: Affidavit of Criminal Offense – added a new bullet two “Please note: The Department will accept individual affidavits from each principal, operator, financial backer or one affidavit signed by a principal or operator that includes every principal, operator, financial backer. If you are unsure if a conviction must be disclosed, please list the conviction in the interest of full disclosure.”

In bullet three they added the term “add notarize

Attachment H: Tax Clearance Certificates

The first bullet removed “Completion of this form is a condition of this application and will authorize” to “This form authorizes the Pennsylvania Department of Revenue (DOR) and..”

Attachment I: Affidavit of Capital Sufficiency

Changed the second bullet around a little “Please note: There are affidavits available, one for …” The content is the same.

Added to the third bullet “and notarize

Attachment J: Sample Medical Marijuana Product Label

The Department added, “Please Note: Attachment J is required for Grower/Processor applicants.

Attachment K: Release Authorization

Added the term “notarized” to the instructions. The form is identical.

Attachment L: Applicant Priorities for Multiple Applications

In the first bullet removed “or counties” after regions. In this bullet, they also capitalized Medical Marijuana Regions.

In the second bullet point, the Department of Health capitalized Medical Marijuana Regions, in the priority section the Department of Health also capitalized Medical Marijuana Regions.

In B. the second checkbox they replaced county with Medical Marijuana Regions in reference to no preference.

There was a big change in the list of territories to remove the counties.

Differences between Pennsylvania Round One Application Instructions vs Round Two Application Instructions

Medical Marijuana Regions Section

Huge Change: They are letting the highest scoring application locate where they submit and allowing two other grower/ processor locations within the same territory. This means there can be up to five grower/ processor locations in one territory.

Fees Section

Added, “Refunds will be issued to the business name provided in Section 1 of the permit application, in care of the primary contact, and mailed to the primary contact’s mailing address.”

Application Timetable Section

Updated to the application dropping April 5, 2018, and due May 17th, 2018. 

Definitions for Terms within Application Documents – Identical

Disclosure of Application Information Section 

Tons of changes within this section. They help define trade secret and confidential proprietary information with how to properly redact

Consent to Investigate and Background checks

First of all, they added Background Checks to the title. Second, they added a ton to the background check process. They added a step to first verify with the digital background check vendor IdentoGo. This requires each member to pre-enroll. Once the fingerprint process has been completed at an IdentoGo location the background check results will be mailed directly to the Department. They provide an enrollment link in the instructions, https://uenrolll.identogo.com

They provide new background codes for each participant. Make sure prior to visiting the IdentoGo location each person has the right code:

  • Financial Backer – 1KG8GT
  • Employee – 1KG8JR
  • Operator- 1KG8H7
  • Principal – 1KG8F9

Here are the definitions of each taken from Title 28—HEALTH AND SAFETY DEPARTMENT OF HEALTH [ 28 PA. CODE CHS. 1141 AND 1151] Medical Marijuana; General Provisions; Growers/ Processors; Amendments to Temporary Regulations:

Financial backer—An investor, mortgagee, bondholder, note holder, or other sources of equity, capital or other assets other than a financial institution.

Employee—An individual who is hired for a wage, salary, fee or payment to perform work for an applicant or permittee.

Operator—An individual who directly oversees or manages the day-to-day business functions for an applicant or permittee and has the ability to direct employee activities onsite and offsite or within a facility for which a permit is sought or has been issued under this part.

Principal—An officer, director or person who directly or beneficially owns securities of an applicant or permittee, or a person who has a controlling interest in an applicant or permittee or who has the ability to elect the majority of the board of directors of an applicant or permittee or otherwise control an applicant or permittee, other than a financial institution.

Preparing and Submitting Your Application Section

Bullet 4. Requires that you provide redacted copies based on section II.

Bullet 6. They removed the following from the first sentence “A completed Form 3817 from the U.S. Postal Service.

They changed the application naming structure from Applicant Name_Submission Date_Application Type_Document Title.pdf. to Applicant Name_ Application Type_Document Title.pdf. they removed Submission Date.

After you Submit your Application Section

The third paragraph changed a little to include the postmarked date to May 17, 2018 deadline.

The added a please note section stating that “Please note: the Department will only take into consideration the permit application and attachments that are received on or before May 17, 2018 deadline, Documentation that is postmarked after May 17, 2018 deadline will be considered in the scoring of your application submission.”

Scoring Methodology Section

Within the overview section, they remove the term “selection committee”

  • Operational Timetable changed from 50 to 75
  • Grow Practice changed from 50 to 100
  • Processing and Extraction changed from 50 to 100
  • Quality control and Testing for Potential Contamination changed from 50 to a checkbox.

Within the Dispensary Scoring Matrix the following changes were made:

  • Transportation of Medical Marijuana changed from 25 to 50
  • Storage of Medical Marijuana changed from 50 to 75
  • Labeling of Medical Marijuana Products from 25 to a check mark
  • Inventory Management changed from 50 to 75
  • Recordkeeping changed from 50 to 75
  • Capital Requirements changed from 50 to a check mark ­
  • Personal Identification changed from 50 to a check mark ­

After the scoring matrix, the round one instructions stop, in the round two instructions the Department goes into great detail on how the diversity and community impact sections are graded.

The distressed community section is moved to the community impact section and a list of Act 47 List of Financially Distressed Municipalities.

Use the cannabis consultants at Quantum 9 to assist you through this process.

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Quantum9

Quantum9

Quantum 9, Inc. is a Chicago, IL-based cannabis consulting firm. We specialize in getting high net worth individuals and private equity cannabis business licenses to cultivate, manufacture and dispense marijuana. We have over 50 marijuana consultants that work for the company, and we have practiced in 12 countries. Our areas of expertise include permit acquisition, team building, employee training planning, and process planning. We help clients fully maximize the potential of any cannabis cultivation, processing, and dispensary business.

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