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New Mexico

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New Mexico signed medical marijuana into state law in April 2007. The state allows residents with qualifying medical conditions to possess and consume medical cannabis products, but it operates on strict policies when issuing cannabis dispensary licenses. Recreational cannabis remains illegal, with heavy fines for first offenses and two weeks of jail time for repeat offenders.

New Mexico has granted medical marijuana producer licenses to 81 non-profit dispensaries in the state. Each producer license allows the organization to cultivate, process, and sell up to 450 cannabis plants, although a judge overturned this limit in 2018. Unfortunately, the state has not accepted new producer applications since 2015.

New Mexico Regulations

Do I need a dispensary license to operate in New Mexico?

Yes – with a catch. Dispensaries must apply for a producer license to sell cannabis products in New Mexico. Licensed cannabis dispensaries must be non-profit organizations, but unlicensed, for-profit companies are legally allowed to sign management agreements with these organizations.

Who manages cannabis licenses in New Mexico?

The New Mexico Department of Health manages cannabis licenses for the state. As of February 2019, the official state website’s Licensing Requirements link is inactive, and the state does not accept new applications for licensing.

How do I get a cannabis dispensary license in New Mexico?

Sign a management contract with an existing dispensary license holder. Although the state has already granted what it considers to be the appropriate number of medical marijuana producer licenses, New Mexico’s non-profit system allows for new dispensaries and out-of-state organizations to operate dispensaries through management contracts with license holders.

What are the requirements for a cannabis retail license?

New Mexico cannabis license holders must be non-profit organizations. Because the state is granting no more licenses, for-profit companies need to acquire management contracts with non-profit medical marijuana license holders. It is not uncommon for New Mexican license holders to be non-profits with no employees, no property, and no equipment, operating under a contract with a for-profit company that actually runs the business.

All cannabis-related management contracts and acquisitions are overseen by the New Mexico Department of Health. These contracts can be approved or denied at the sole discretion of the department secretary.

How much does a cannabis retail license cost?

Between $40,000 and $90,000. The latest data on New Mexico’s licensing fee structure indicates a three-tiered system based on the number of plants a license holder wishes to cultivate and sell. Organizations that wish to operate at the state’s maximum capacity of 450 plants must pay $90,000.

Are there annual licensing fees?

Yes. The $40,000 to $90,000 licensing fee is annual, payable every year the license holder remains in business.

What license type do I need to service recreational and medical patients?

There is no recreational marijuana license in New Mexico and only one kind of medical license. The medical license establishes a non-profit organization as a producer, which includes cannabis cultivation, processing, distribution, and sales.

When will cannabis retail licenses be issued?

New Mexico isn’t issuing any new licenses at the time, but the state governor ran on a recreational legalization platform and has instructed lawmakers to look at recreational markets for 2019. It is possible that a new retail licensing application period will open in the near future.

Will I be able to get a retail license if I already have a dispensary?

Yes. New Mexico’s non-profit cannabis dispensary law allows unlicensed for-profit companies to own and manage medical marijuana license holders. A dispensary owner can sign a management contract with an existing license holder and obtain a retail license to sell medical cannabis in New Mexico.

What local (county-level) permissions will I need to operate?

New Mexico allows county and city governments to set local rules for cannabis growers and dispensaries. Municipal governments can even choose to ban cannabis entirely, although no local governments have done so since the state law went into effect. Instead, most large cities in New Mexico have taken steps to decriminalize recreational marijuana use at the local level.

Cannabis Event Licensing

Do I need a license to host a cannabis event in New Mexico?

Public exposure to cannabis awareness campaigns and initiatives is protected by the First Amendment, according to a February 2019 court ruling. This ruling should protect both non-profit license-holders and for-profit non-license holders from litigation for organizing cannabis events.

Do I need a separate premises license for cannabis events?

No. Cannabis event organizers and exhibitors do not need to apply for special licensing to hold cannabis events.

Can I obtain a cannabis event license if I hold a retailer license?

New Mexico does not provide for a special cannabis event licensing application or mechanism. Since a state judge ruled that cannabis events are covered by the First Amendment, any individual or organization should be able to hold a cannabis event.

Managing Your Business in New Mexico

How can I ensure that I remain compliant?

New Mexico requires dispensaries to maintain personnel records for each employee, document all employee training materials, report sales and losses, and implement a robust seed-to-sale tracking system. Additionally, dispensaries cannot sell CBD products imported from outside the state. Dispensary operators should appoint a compliance officer and integrate systems for meeting New Mexico’s stringent reporting regulations.

What security measures am I required to take?

New Mexico state law requires dispensaries to implement fully functional security alarm systems and to maintain 24 months’ worth of documentation on the maintenance of their systems. It requires dispensaries to produce these documents within 24 hours of a Department of Health request.

Can I package and label cannabis in my retail store?

Cannabis producers may package and label their own cannabis products as long as the packaging follows New Mexico state rules. Packaging must be opaque and child-resistant while prominently displaying the product’s seed-to-sale batch code and medical data.

Can I sell alcohol or tobacco at my cannabis retail store?

New Mexico state law does not mention alcohol or tobacco in its medical marijuana statutes. Although most New Mexico dispensaries sell pipes, bongs, and rolling papers, they do not generally sell tobacco or alcohol products.

Can I vertically integrate my cannabis businesses?

Yes. New Mexico grants a single “producer” license to its non-profit cannabis industry applicants. These licenses grant the right to cultivate up to 450 plants, process them into cannabis products, distribute them to dispensaries, and sell them to patients.

Can I sample or give products away in-store?

New Mexico state law doesn’t address cannabis advertising, promotion, or marketing, which leaves free samples and giveaways in a legal grey area. However, New Mexico dispensaries must report sales and account for missing products, which disincentivizes free sampling.

What are the operating hours for a retail shop?

New Mexico does not impose operating hours on its dispensaries. The state permits home delivery as well, although few dispensaries offer deliveries outside of their regular business hours.

Can I have public-facing displays on my storefront?

Yes. New Mexico state law fails to address cannabis advertising, promotion, or marketing in any way. In practice, medical cannabis dispensaries build public-facing displays and advertisements to attract patients.

How old does someone need to be to buy cannabis?

Licensed medical marijuana patients must be over the age of 18 and have one of the state’s qualifying medical conditions. Minors can gain access to cannabis products only through the appointment of a primary caregiver who is responsible for making the purchase on the minor’s behalf.

What is seed-to-sale reporting and what is required of retailers?

Seed-to-sale reporting is the ability to track individual cannabis batches through the entire logistics chain. New Mexico state law requires dispensaries to use batch numbers to track cannabis products and report sales to authorities.

Sources:

https://nmhealth.org/resource/view/222/ (broken link, but I used a Google Cache of the page)
https://www.civilized.life/articles/how-old-to-smoke-weed-in-new-mexico/
https://www.safeaccessnow.org/new_mexico_legal_information
https://www.abqjournal.com/723600/no-true-nonprofits-in-pot-business.html

How the New Mexico medical cannabis market is priming for expansion in 2019


https://www.cannabisbusinesstimes.com/article/week-in-review-january-21/
https://nmhealth.org/help/faq/
https://nmhealth.org/about/mcp/svcs/pdb/

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