Texas Officials Adopt Rules To Expand Number Of Medical Marijuana Dispensaries In the State

Texas officials have formally adopted new rules to implement a law significantly
expanding the state’s medical marijuana program.

About two months after the Department of Public Safety (DPS) posted the
proposed rules—after which point a 30-day public comment period was
completed—the regulations were finalized and published in the Texas
Register on Friday.

This specific set of rules will increase the number of licensed
dispensaries, establish security requirements for “satellite” locations and
authorize the revocation of licenses for certain violations.

DPS will ultimately be issuing 12 new licenses for dispensaries across the
state. Currently there are only three. The additional licensees will go
through a competitive process, with officials prioritizing Texas’s public
health regions to optimize access.

The first round of licenses will be awarded to nine of 139 applicants who
submitted their forms during an earlier application window in 2023. DPS
will select those nine licensees on December 1. The 2023 applicants that
didn’t receive a license, as well as any new prospective licensees, will
have another shot at getting their license during a second round where
awardees will be announced on April 1, 2026.

The finalized rules also lay out security parameters for dispensaries with
satellite locations approved by the department, including mandates to
“designate an enclosed locked area within the satellite location where
low-THC cannabis product is stored that provides reasonably adequate
security against theft and diversion” as well as “designate an individual,
or a limited number of individuals, with responsibility for and with the
authority to enter or control entry” into those secure areas.

Additionally, they specify policies allowing regulators to revoke licenses
for violations such as not having cannabis products available within 24
months of a license issuance, failing to “promptly and accurately fill
prescriptions” and not “continuously” producing cannabis “in a manner
consistent with the level of demand for the licensee’s product.”

DPS received two comments on the rules when they were up for public review,
but no changes were made based on the feedback.

In addition to increasing the number of dispensaries in the state, the law
signed by the governor also expands the state’s list of medical cannabis
qualifying conditions to include chronic pain, traumatic brain injury
(TBI), Crohn’s disease and other inflammatory bowel diseases, while also
allowing end-of-life patients in palliative or hospice care to use
marijuana.

That policy change is automatically adopted via the enacted statute, so it
took effect on September 1 without further rulemaking.

Also in line with the state’s medical cannabis expansion law that Gov. Greg
Abbott (R) signed, the state Health and Human Services Commission (HHSC)
proposed rules last month to let physicians recommend new qualifying
conditions for cannabis and to create standards for allowable inhalation
devices.


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Meanwhile, Department of State Health Services (DSHS) recently adopted a
set of emergency rules meant to prevent the sale of intoxicating hemp
products to people under 21.

After similar restrictions were implemented by the Texas Alcoholic Beverage
Commission (TABC) late last month, DSHS announced that they’ve moved
forward with the policies changes that comply with the governor’s recent
executive order on hemp.

Meanwhile this month, the head of the Texas Department of Agriculture (TDA)
pushed back against a GOP senator’s “incorrect assertions” about the
state’s regulatory compliance with federal hemp laws. But he also signaled
that changes may be coming to measure “total THC” to determine the legality
of hemp products in a way that some stakeholders worry could negatively
impact the industry.

After the legislature failed to pass a controversial bill to ban hemp
products containing THC during two special sessions following the
governor’s veto of a similar measure earlier this year, Abbott signed the
executive order to impose certain restrictions on the market.

Separately, a recent survey from a GOP pollster affiliated with President
Donald Trump found that Texas Democratic and Republican voters are unified
in their opposition to the hemp ban proposal.

*Image element courtesy of AnonMoos.*

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