Ala. Admin. Code r. 538-X-3-.05

Current through Register Vol. 42, No. 7, April 30, 2024

Section 538-X-3-.05 - Contents Of Application

The Application filed with the Commission shall include the following, in the order stated:

(1) Cover Sheet - as provided with the Application Form.

(2) Summary Sheet - as provided with the Application Form based on information provided in the Applicant's Request for Application:

(a) the category of license being applied for;

(b) the Applicant's name, business address, business email address, and business telephone number;

(c) the Applicant's Social Security Number or Federal Tax Identification Number;

(d) the name, business address, business email address, and direct dial telephone number of the contact person who will be responsible for fielding and responding to additional requests by the Commission.

Throughout the Application Process, any changes to the foregoing information must be brought to the immediate attention of the AMCC through the website, and such information changes do not constitute an "Amendment" as provided under this chapter. Notwithstanding the foregoing, changes with respect to the category of license being applied for may not be made after the window closes for requesting an application form (for the initial offering, 4:00 p.m., CDT on October 17, 2022, or at 4:00 p.m. Central Time on the date these rules become effective, whichever is later.

(3) Application Information - Responses to the Application Form, in the order provided on the Application, to the following, all of which shall be construed broadly to ensure the broadest disclosure and greatest transparency reasonably possible based on the best available information at the time of the application is submitted or amended:

(a) With regard to each ownership entity that has any ownership interest in the applicant ("ownership entity"), the applicant shall verify all of the following:

1. The identity of every individual having an indirect or direct ownership interest in the ownership entity. For purposes of this paragraph, if the business entity is a trust, the application shall disclose the names and addresses of all trustees and beneficiaries; if a privately held corporation, the names and addresses of all shareholders, officers, and directors; if a publicly held corporation, the names and addresses of all shareholders holding a direct or indirect interest of greater than five percent, officers, and directors; if a partnership or limited liability partnership, the names and addresses of all partners; if a limited partnership or limited liability limited partnership, the names of all partners, both general and limited; or if a limited liability company, the names and addresses of all members and managers.

2. The identity of all of the following other entities, if the other entities are directly or indirectly involved in the cannabis industry, including, but not limited to, the cultivation, processing, packaging, labeling, testing, transporting, or sale of cannabis.

(i) Any subsidiary, affiliate, conglomerate, parent, or other entity that shares common ownership, directly or indirectly, with the ownership entity.

(ii) Any partnership or limited liability partnership of which the ownership entity is a partner.

(iii) Any limited liability company of which the ownership entity is a member or manager.

(b) Verification with regard to each individual having any ownership interest in the applicant (greater than 5% with respect to publicly traded corporations), the identity, street address and responsible person of all entities with which the individual is connected, to the extent the entity is directly or indirectly involved in the cannabis industry, including, but not limited to, the cultivation, processing, packaging, labeling, testing, transporting, or sale of cannabis or medical cannabis, either in Alabama or any other jurisdiction:

1. Any business, including any partnership, limited liability partnership, sole proprietorship, limited liability company or other incorporated or unincorporated business entity or venture, of which the individual or his or her spouse, parent, or child has any equity interest.

2. Any business, including any partnership, sole proprietorship, limited liability company, or other incorporated or unincorporated business entity or venture of which the individual or his or her spouse, parent, or child is a member or manager.

(c) Verification as to whether an owner, director, board member, or individual with a controlling interest in the applicant has been indicted for, charged with, arrested for, convicted of, pled guilty or nolo contendere to, or forfeited bail concerning any felony or controlled substance-related misdemeanor, not including traffic violations, regardless of whether the offense has been reversed on appeal or otherwise, including the date, the name and location of the court, arresting agency, and prosecuting agency, the case caption, the docket number, the offense, the disposition, and the location and length of incarceration.

(d) Verification as to whether the applicant or any entity affiliated with the applicant has ever applied for or has been granted any commercial license or certificate issued by a licensing board or commission in this state or any other jurisdiction that has been denied, restricted, suspended, revoked, or not renewed and a statement describing the facts and circumstances concerning the application, denial, restriction, suspension, revocation, or nonrenewal, including the licensing board or commission, the date each action was taken, and the reason for each action.

(e) Verification as to whether the applicant or any entity affiliated with the applicant is or has been authorized in any other jurisdiction to participate in the cannabis or medical cannabis industry or has been licensed (i.e., a "licensee" as defined in Chapter 1 of these Rules) or provided similar status in any other jurisdiction; if so, the applicant must provide a list of any disciplinary measures (including but not limited to formal written reprimands, citations, fines, violations, suspensions, non-renewals, or license terminations/revocations) received by any of its affiliate entities during the last five (5) years, including the jurisdiction, date, reason for the discipline, steps taken in compliance, and the outcome of such disciplinary measures, if any.

(f) Verification whether the applicant or any affiliate has within the last ten (10) years filed or been served with, a complaint or other notice by any governmental body, regarding a delinquency in the payment of, or a dispute over the filings concerning the payment of, any tax required under federal, state, or local law, including the amount, type of tax, taxing agency, time periods involved, and the resolution, if any, of the matter.

(g) A statement listing the names and titles of all public officials of any unit of government, and the spouses, parents, and children of those public officials, who, directly or indirectly, own any financial interest in, have any beneficial interest in, are the creditors of or hold any debt instrument issued by, or hold or have any interest in any contractual or service relationship with an applicant.

(h) The anticipated or actual number of employees at prospective commencement of operations and during the first five calendar years thereafter.

(i) The number of days, if awarded a license, within which the Applicant reasonably projects it will commence operations as to each facility identified in the application, and the number of days within which the Applicant reasonably projects it will reach full capacity as to the operations contemplated with regard to each facility identified in the Application.

(j) The Applicant's consent as required by §20-2 A-55(d), Code of Ala. 1975, (as amended) to the inspections, examinations, searches and seizures contemplated by § 20-2A-52(a)(3), Code of Ala. 1975, (as amended).

(k) Verification that the Applicant's proposed facility or facilities will be in a permissible location, if applicable, and will maintain compliance with all State and local laws, resolutions, and ordinances.

(l) Verification that the Applicant and its leadership have no economic interest in any other license or Applicant for license under the Act or this Chapter (See§ 20-2A-55 {e), Code of Ala. 1975, (as amended)).

(m) Exhibits to the Application Information, separately formatted and labeled, in the following order:

1. The resume or curriculum vitae of each individual listed in response to subparagraph 3.(a)(l) of this Rule, showing, at a minimum, all institutions of higher education attended, including the date, location and type of any degree received; all residential addresses in the last 15 years; and the name, business address and telephone number of all employers in the last 15 years, including a contact person at each.

2. A demonstration of sufficient capital (as defined in this Chapter) available to the Applicant, as well as the source thereof, and verification of the same by a responsible person designated by the Applicant, the Applicant's contact person, and an independent certified public accountant.

3. Certified copies of the Applicant's business formation documents, to the extent applicable.

4. Records indicating that a majority of ownership in the Applicant is attributable to an individual or individuals with proof of residence in this state for a continuous period of no less than 15 years preceding the application date.

5. For an applicant seeking an integrated facility license or a cultivator license, records indicating that a majority of ownership in the Applicant is attributable to an individual or individuals, or an entity or entities, with cumulative business experience in the field of commercial horticulture or agronomic production for a period of at least 15 years.

6. Verified Written Consent from all individuals identified by§ 20-2A-55(b), Code of Ala. 1975, (as amended), to a state (SBI Form 46) and national (FBI Background Request Form) criminal background check, which shall be conducted, at the Applicant's expense, by ALEA and/or another state agency or qualified third party specializing in obtaining such background checks, as chosen by the Commission.

7. If applicable, certified copies of the applicant's business license and resolution or ordinance by local authorities (County or Municipality, as appropriate) approving the facility's business presence in the local jurisdiction.

8. A current financial statement or pro forma containing the following, with year- end projections as to each over the first three (3) calendar years (i.e., the year of commencement plus three more) following commencement of operations:

(i) Balance sheet report, providing a snapshot of the value of assets, liabilities and equity at commencement, or for projections, as of December 31 of each year.

(ii) Profit and loss report, summarizing any income, expenses and net profit from the applicant's inception to date of commencement and as projected over each calendar year thereafter, including the year of commencement.

(iii) Statement of cash flow, examining the cash flowing into and out of the applicant's business from inception to commencement and during each calendar year thereafter, including the year of commencement.

9. The Applicant's verified tax plan demonstrating understanding of, and plans for compliance with, all applicable tax laws, including but not limited to providing all information required for purposes of the taxes levied by Chapter 2A of Title 20, and payment of the same.

10. The Applicant's proposed Employee Handbook, if available, including but not limited to safety policies, including personnel safety and crime prevention techniques; the Applicant shall provide a verified current copy of same.

11. The Applicant's proposed Policies and Procedures Manual, if available; the applicant shall provide a verified copy of same.

12. A statement of the following, regarding each facility the Applicant proposes to operate, as of the commencement of operations and within two (2) years thereafter:

(i) The physical address and GPS coordinates of the facility.

(ii) An aerial photograph of the facility, including clearly identified site boundaries.

(iii) Proof of authorization for the Applicant to occupy the property where each facility is proposed to be located.

(iv) Proof of local zoning and other approvals necessary to operate the business in the local jurisdiction where the business is located, including but not limited to the local jurisdiction's ordinance or resolution approving the operation of medical cannabis facilities there.

(v) A professionally rendered blueprint (or, if not available, a professionally rendered floorplan or schematic) of each facility the Applicant proposes to operate, showing clearly drawn and labeled interiors of such facilities, including but not limited to the general function of each area of the structure, for ease in identification of operations and processes by the Commission during future inspections.

(vi) A timetable for completion and commencement of operations as to each facility.

(vii) A statement whether such facility shall be open to the public and if so the anticipated hours of business operation.

(viii) The hours of operation during which the facility will be occupied by Applicant's employees; if not continuous, the after-hours contact information for management.

13. A complete site map of any website owned or operated by the Applicant, and the web address of any webpage, social media page or other online site owned or operated by the Applicant

14. A roster of all personnel (all leaders and employees) affiliated with the company, including names, street addresses, contact telephone numbers, email addresses and social security numbers, current to within the last thirty (30) days. Applicant must verify that all employees are registered to the AMCC website and have undergone or are scheduled to undergo appropriate pre-employment background checks.

15. The Applicant's Verified Business Plan, to include, at a minimum, the following:

(i) A clearly defined business structure and plan for adherence to applicable corporate conventions.

(ii) Clearly defined business goals, including a three (3) -year and a five (SJ-year plan.

(iii) An Organizational Chart - a diagram that visually conveys the Applicant's internal structure by detailing the roles, responsibilities, and relationships between individuals within an entity.

(iv) Job descriptions of all managerial positions, showing clear delineation of authority, qualifications, and duties.

(v) Job descriptions of all non-managerial employee positions, showing clear delineation of qualifications and duties.

(vi) An executive summary, including mission statement, leadership background and qualifications, business style and philosophy, key personnel, identification of facilities' location and function.

(vii) A description of products and/or services to be cultivated, processed, transported, dispensed, or tested at each facility, as applicable, including actual (or projected) pricing data, if applicable; actual (or projected) product lifespan, if applicable; projected benefits to consumers; patents, if any; and proprietary technology, if any.

(viii) An advertising/marketing analysis and strategy, if any.

(ix) A Community Engagement Plan describing all efforts that have been or will be made to foster the applicant's relationship with, involvement in, and commitment to any community (including municipality or county) in which the applicant intends to locate a facility within the next three years.

(x) An Environmental Impact Statement outlining the anticipated impact of each of the applicant's proposed operations, per facility, on the local environment; the applicant's efforts or plans, if any, to build a relationship to foster cooperation and compliance with federal, state and local agencies providing environmental oversight; and any steps the applicant has taken or will take to reduce or eliminate its carbon footprint and/or to achieve and maintain a positive environmental profile in each community where the applicant intends to locate and operate a facility within the next three years.

(xi) An insurance plan, including declarations pages and letters of intent, if any, from an A-rated insurer as to, at a minimum, casualty, workers' compensation, liability, and (as applicable) auto or fleet policy.

16. The Applicant's Standard Operating Plan and Procedures, verified by Applicant. Applicants must demonstrate and maintain standard operating procedures regarding the following subjects in such a way that they can be readily accessed from the physical site of operations upon the request of inspectors, the Commission, or Commission staff, including, at a minimum, the following:

(i) IT plan for ensuring accurate recordkeeping, compliance with inventory protocols, and coordination of information and systems with vendors, customers and others, as applicable, through the Alabama Medical Cannabis Patient Registry System (§ 20-2A-35, Code of Ala. 1975, (as amended)); the Statewide Seed-to-Sale Tracking System (§ 20-2A-54, Code of Ala. 1975, (as amended)), access to and coordination of which shall be paid for and maintained by the licensee; and, as applicable, a third-party inventory control and tracking system(§ 20-2A-60, Code of Ala. 1975, (as amended)), also to be paid for and maintained by the licensee.

(ii) Plan for maintenance and storage of cannabis and medical cannabis at all times while in possession and control of licensee, including the limitation of access to cannabis and medical cannabis to essential personnel by position.

(iii) Quality Control/Quality Assurance plan. Applicants shall have a plan for performing, at their own expense after licensure, quality control and testing of a qualified sampling (as defined in 538-x-10-.01 et seq. of these Rules) of medical cannabis in their control, regardless of whether said medical cannabis has been packaged, labeled and sealed. Such testing shall be conducted by the State Testing Laboratory (as detailed in 538-x-10-.01, et seq. of these Rules). Nothing herein shall prohibit a licensee from conducting, at the licensee's own expense, separate in-house testing or testing by an independent third party at any point during the licensee's possession and control of cannabis or medical cannabis.

(iv) Contamination and recall plan. Applicants must, during the application process, provide to the Commission, and, upon licensing, must maintain and review at least annually thereafter, a clear written contamination and recall plan, detailing the steps to be undertaken in the event of discovery of contamination of cannabis or medical cannabis within the possession and control of the licensee. The plan must account for the safety of employees and others on the premises, notification of proper authorities, proper disposal of contaminated cannabis and medical cannabis, steps to be taken for the preservation of cannabis or medical cannabis, and the reasonable efforts to maintain access to medical cannabis by those who depend on it.

(v) Criminal activity plan. Applicants must, during the application process, provide to the Commission, and, upon licensing, must maintain and review at least annually thereafter, a clear written criminal activity plan, detailing the steps to be undertaken in the event of discovery of criminal activity related to cannabis or medical cannabis within the possession and control of the licensee. The plan must account for the safety of employees and others on the premises, reporting the criminal activity to proper authorities, steps to be taken for the preservation of cannabis or medical cannabis, and the reasonable efforts to maintain access to medical cannabis by those who depend on it.

(vi) Emergency procedures/disaster plan. Applicants must, during the application process, provide to the Commission, and, upon licensing, must maintain and review at least annually thereafter, a clear written Emergency Procedures and Disaster Plan, detailing the steps the Applicant will take to ensure the safety of employees and others on the premises, the preservation of cannabis or medical cannabis, and the reasonable efforts to maintain access to medical cannabis by those who depend on it, in the event of any reasonably foreseeable emergency, or natural disaster that may affect the licensee, its facilities, personnel, products or customers.

(vii) Alcohol, smoke, and drug-free workplace policies. Applicants must, during the application process, provide to the Commission, and, upon licensing, must maintain and review at least annually thereafter, a clear written Alcohol, Smoke and Drug Free Workplace Policy, which shall be included in the Employee Handbook and/or the Policies and Procedures Manual.

(viii) Employee Safety Plan in compliance with parallel OSHA standards applicable in similar types of workplaces.

(ix) Confidential Information and Cybersecurity Plan. The Applicant's plan for maintaining confidential information and any records required to be confidentially maintained.

(x) A plan for tracking and proper disposal of waste cannabis or medical cannabis, as necessary.

(xi) A verified Security Plan as to each of the Applicant's proposed facilities, addressing each of the following aspects of security and meeting the following minimum thresholds:

(I) Alarm systems must be installed in all facilities where cannabis or medical cannabis is maintained or stored. Such alarms shall be provided and installed by experts in industry-standard commercial-grade alarm systems. Alarm systems must be fully operational securing all entry points and perimeter windows, be equipped with motion detectors and pressure switches covering all areas where cannabis or medical cannabis is grown, handled, stored, prepared, transported, tested, or dispensed.

(II) Reception areas and personnel adjacent to ingress and egress points shall have ready access to duress panic and hold-up alarms that may be activated in the event of access by unauthorized personnel or intruders.

(III) Licensee facilities shall maintain an audio/video surveillance system that shall be in continuous operation 24 hours per day. Recording devices shall be fixed in place covering both the interior and exterior of the facility, in such quantity and at such resolution as shall allow for the clear identification of individuals and activities in all reasonably accessible areas of the premises, including but not limited to all point-of-sale areas, entrances, exits, parking lots, and any area where cannabis or medical cannabis is grown, handled, stored, prepared, transported, tested, or dispensed. Audio recordings shall clearly and accurately capture sound within camera range at a level of 20 decibels or greater. Audio/video surveillance recordings must clearly and accurately display the time and date.

(IV) The facility's perimeter and any outdoor premises must be surrounded by a sufficient fence or barrier to prevent access by unauthorized persons and must have sufficient lighting to allow for the proper functioning of video surveillance equipment, at all times between dusk and dawn, or at any other time when ambient lighting requires enhancement to permit identification of individuals or activities upon or immediately adjacent to the premises. Indoor premises must likewise be sufficiently lit to allow for the identification of individuals and activities.

(V) Exterior doors of each facility must be designed or reinforced to withstand unlawful forcible entry; exterior doors shall, at all times, remain locked against outside intruders, while allowing free egress by the facility's occupants in the event of an emergency; doors must permit ingress to employees and other appropriate persons only by means of a keycard or other similar electronic access device.

(VI) Exterior walls of each facility must be reinforced to withstand unlawful forcible entry. Windows, likewise, must be reinforced to prevent breakage by outside intruders.

(VII) Applicants must provide and maintain a plan for sufficient staffing of security guards at each facility where cannabis and medical cannabis is present to reasonably ensure the safety of the products stored therein; however, the applicant's plan must provide, at a minimum, one (1) security guard per facility during the facility's business/operating hours.

(VIII) Strict access controls shall protect areas where cannabis or medical cannabis is handled or stored - in a secured, locked room or vault.

(IX) Records, whether electronic or manual, must be kept, at all times, of all persons on the premises at a facility, including employees, vendors, transporters, medical cannabis patients and caregivers, and all others, recording the individuals' name, date, time of ingress and egress, and (as to non-employees) the reason for their presence; such records shall be kept for a minimum of two years.

(X) Audio/Video surveillance records must be kept for at least 60 days, and longer upon the request of the Commission, its inspectors, or any law enforcement personnel. Audio/Video recordings potentially reflecting an incident of actual or attempted diversion must be kept for the longer of a period of two years, or until resolution of the incident and apprehension and discipline or prosecution of the individuals involved in the actual or attempted diversion.

(XI) Employees, while on duty, shall wear identification badges that clearly identify them as employees.

(XII) Visitors, including Commission members, inspection personnel, or other representatives, shall wear a "visitor pass" or "AMCC Official" pass, as applicable, at all times while on the premises.

(XIII) Applicants, and upon licensure, Licensees, shall maintain, review and update policies to report theft, diversion or other loss of cannabis or medical cannabis to the Commission and to law enforcement within 24 hours of the event or its discovery.

(XIV) The Applicant, and upon licensure, the Licensee, upon request, shall make available to the Commission or its inspectors all information relating to security alarm systems, monitoring, alarm activity, maps of camera locations and camera coverage, surveillance equipment maintenance logs, authorized use lists, operation instructions, and any other security-related information deemed relevant by the Commission or its inspectors.

(xii) To the extent that an applicant seeks status as a licensee that is at least 51% owned by, and is managed and controlled in its daily operations by, members of a minority group as defined in § 20-2A-51(b) of the Code of Ala. 1975, (as amended), the applicant must provide a verified statement that it is applying for such status as well as documentation demonstrating the basis for seeking such status, including but not limited to a showing that at least 51% of the owners are (or, in the case of a corporation, 51% of the shares belong to) members of a minority group, and that the applicant is managed and controlled by members of a minority group in its daily operations. To the extent that the applicant has entered into contracts with any members of a minority group to assist the applicant in attaining such status, the applicant must provide verified copies of such contracts.

(xiii) Any information and/or documents specific to the category of Applicant (Cultivator, Processor, Secure Transporter, Dispensary, State Testing Laboratory, Integrated Facility) as identified separately in these Rules.

(xiv) Affidavit of the Applicant (or, if an entity, the responsible party thereof AND the contact person) that the information provided in the Application is true and correct, to the best of the Affiants' knowledge upon a diligent investigation thereof.

(xv) Application Fee as provided in § 20-2A-55(f), Code of Ala. 1975, (as amended). The Applicant's nonrefundable Application Fee, in the designated amount, must be submitted electronically per instructions accompanying the Application Form.

Ala. Admin. Code r. 538-X-3-.05

Adopted by Alabama Administrative Monthly Volume XL, Issue No. 11, August 31, 2022, eff. 10/15/2022.

Author: William H. Webster

Statutory Authority:Code of Ala. 1975, §§ 20-2A-22, as amended.