Licensing

By Det. Joe Patterson (Ret.) and Patrick Poston Esq.

The urgency of the medical marijuana license application process has passed, but now license applicants need to be focused on next steps to fully capitalize on this unique opportunity. There were nearly 2,300 applications for 348 medical marijuana licenses in Missouri with roughly 1 in 7 applicants securing a coveted license. The investment of time and money in business planning and application only to fail the commencement inspection and be denied the ability to operate could be catastrophic. Given the emphasis on security in the application process (20% of the overall application), security training and compliance are paramount to passing the commencement inspection and additional annual inspections.

Security requirements for cultivation, manufacturing, and dispensary facilities are detailed in 19 CSR 30-95.040(H). With respect to required security training, 19 CSR 30-95.040(H)(7) dictates each facility employs a Security Manager responsible for, inter alia (among other things), conducting a semiannual audit of security measures to ensure compliance and training employees on: security measures, emergency response, theft prevention and response within one (1) week of hiring and on an annual basis. Thus, it is critical licensees have a plan in place to ensure compliant security training of all new hires within 7 days as well as a policy to maintain training records for the commencement inspection (and subsequent inspections).

Additionally, 19 CSR 30-95.040(H)(8) mandates the Security Manager, any facility agents who provide security for the facility, and any third-party employees who provide security complete additional training in:

• Theft prevention or a related subject;
• Emergency response or a related subject;
• Appropriate use of force or a related subject that covers when the use of force is and is not necessary;
• Process of crime scene protection or a related subject;
• Control of access to protected areas of a facility or a related subject;
• Minimum of eight (8) hours of training at the facility in providing security services; and
• Minimum of eight (8) hours of classroom training in providing security services.

Of all states that have passed legislation allowing medical marijuana, Missouri is one of the most stringently regulated with a heightened emphasis on security. The state will have fourteen (14) or more DHSS inspectors to perform the commencement inspections and enact random annual inspections (announced or unannounced). With the financial implications at stake for license holders and investors, it is imperative licensees ensure effective security compliance.

Establishment of a comprehensive security training plan is the first step to capitalizing on this opportunity.

Every applicant group had to explicitly identify their Security Director on the application(s). In Missouri’s highly competitive application process, we expect to see many impressive resumes for the Security Director position. In many cases, it is highly likely the hand-selected Security Director had a long career in areas like corporate security, military service, or law enforcement. These individuals were presumably indispensable in building out your security plan. However, if these Security Directors are expecting to be more of an advisory position and not wanting to handle the minutia of the above outlined requirements, then hiring a Security Manager or contracting with a Security Management Firm is an option worth exploring.

Once licenses are awarded, there will be so much more for operating groups to do; finalizing real estate deals, applying for construction permits, solidifying strategic supply chain partnerships and so on.

Not a single one of these is more important than the other and many applicants come from backgrounds with experience in these activities. Nevertheless, security management and training are essential to maintain regulatory compliance, protection of your staff, your investment, and solidifying the Missouri cannabis industry as a legitimate and lucrative business.

What do you do if your group decides they would rather contract these responsibilities to a professional firm?

If you find yourself in need of a service provider for security management and training there are several Missouri based companies to assist you with not only these requirements, but also security equipment (cameras, lights, entry access, etc.), guard services, and many other security related matters.

No matter what your needs may be, you should properly vet all security personnel or firms based on past proven performance, knowledge of compliance regulations, and ability to deliver services properly. This may seem daunting but asking the right questions can you help vet security employees or contractors in order to find the true professionals.

Below is a brief list of questions any experienced security professional or firm should be excited to answer:

• What training and education background do you or your firm have as it relates to physical security experience?
• Do you or your firm have the required professional and businesses license to operate in the State of Missouri
• Are you and your firm insured?
• What type of facilities have you been responsible for in the past and can you provide references?
• Have you or your firm ever been defendants in civil litigation as it pertains to business or negligent security activities?
• What types of ongoing training do you or your firm conduct in order to stay up to date on regulatory updates and case law updates?
• What is the pricing structure of your services? (By the hour, monthly retainer, or something else).
• Is your group a member of the Missouri Medical Cannabis Trade Association?

Finally, the individual or group who wrote the security portion of your application should be consulted prior to signing any contracts with firms or hiring an individual Security Manager. The purpose of this is to ensure the contractor or individual has a working and proficient knowledge of DHSS regulations and that the security plan set forth in your application can be fulfilled as it was stated on the application. Remember, you have to make a good faith effort to accomplish what you said you would do on the application, falling short on what was placed on the application could put your license(s) in jeopardy.

Best of luck to everyone as we await licensure. We look forward to working with all involved to make the Missouri cannabis industry safe, professional, and profitable.

About the Authors:

Joe Patterson (Co-Founder/Chief Executive Officer) and Patrick Poston, Esq. (Chief Legal Officer) are from Ceres Management Group (Ceres MG) LLC. Ceres MG is a Missouri based firm that provides competitive application writing services, security program development, and security management for the Missouri Medical Cannabis Industry.

Ceres MG is a military and police veteran owned business with strong connections to statewide law enforcement and international security experience,

For more information, you can contact Joe Patterson via email at JPatterson@CeresMG.com