South Dakota Marijuana License

South Dakota Marijuana License

License Procurement Opportunities & Measure 26

What the Legislation Says (Medical-Use):

Measure 26, which legalizes the medical use of cannabis by authorized patients 21 and older, was approved by 70% of voters. The regulatory authority will be granted to the South Dakota Department of Health (SDDOH). If more applicants than available licenses apply, the SDDOH will consider input from the local government the preference for registration. 

Getting a Medical Marijuana License in South Dakota:

The measure gives the SDDOH no later than October 29, 2021 to enact the rules for the state’s medical-marijuana program, including application requirements. The department will establish a scoring system for competing medical cannabis establishment applicants in cases where more applicants apply than local jurisdiction allows.  

What the Legislation Says (Adult-Use):

South Dakota made history by simultaneously legalizing medical and adult-use marijuana. Amendment A legalized recreational cannabis use for individuals 21 years and older only by a slim 54% margin. Under the measure, individuals are allowed to possess or distribute up to one ounce of marijuana. Amendment A directs the State Department of Revenue (SDDOR) to issue “enough licenses to substantially reduce the illicit production and sale of marijuana throughout the state” and, if necessary, limit licenses “to prevent an undue concentration of licenses in any one municipality.” Local governments can enact ordinances or regulations governing the time, place, manner, and number of licensees operating within its jurisdiction. Municipalities may also ban the establishment of licensees or any category of licensee within its jurisdiction. 

Getting an Adult-Use Marijuana License in South Dakota:

The measure has given the SDDOR the power to create four licenses types:

  • Commercial cultivators and manufacturers to cultivate, process, manufacture, transport, and sell marijuana to wholesalers
  • Independent marijuana testing facilities
  • Wholesalers to package, process, and distribute marijuana to retail stores
  • Retail stores to sell and deliver marijuana

The SDDOR has until April 1, 2022, to create rules and regulations necessary for a regulatory framework. However, there is currently a lawsuit filed by law enforcement claiming that the measure violates the state’s single-subject rule. Opponents argue that the measure addresses five subjects: legalizing marijuana; regulating, licensing, and taxing marijuana; licensing and regulating marijuana by political subdivisions; regulating medical marijuana; and regulation of hemp.

The GPS principal legal team will be monitoring the situation and how it will affect the South Dakota adult-use market.