Interest in medical cannabis is definitely high in Kentucky.
The Kentucky Office of Medical Cannabis released an updated and final tally for the total number of applications it received for the medical cannabis license lottery. As of the August 31, 2024 deadline, 4,998 applications were received by the Commonwealth.
The lottery drew thousands of applicants—and their nonrefundable application fees—although just 74 licenses will initially be issued for cultivation, processing, and dispensing. Application fees ranged from $3,000 to $20,000, depending on the type of license sought. The top two applicant categories, dispensary and processor, each had an application fee of $5,000. The fees generated by all applications totaled nearly $28 million.
Dispensary applications were the most prevalent, comprising 4,076 entrants. Only 48 dispensaries will be licensed at this time. These licenses will be distributed among 11 geographical regions. Each region will receive at least four dispensary licenses, but not more than one per county. Lexington and Louisville’s regions are being allocated a minimum of six licenses, two of which may be in Fayette and Jefferson Counties.
The other categories for licenses were cultivator (i.e., plant grower), safety compliance, and processor (i.e. packaging the plant material into product). Prospective cultivators could apply in different tiers based on proposed size of operations, ranging from a maximum of 2,500 square feet (Tier I) to 10,000 square feet (Tier II) to 25,000 square feet (Tier III). The number of applications received in all categories and their related application fees were as follows:
| License Type | Number of Applicants | Application Fee | Total in Fees |
| Dispensary | 4,076 | $5,000 | $20,380,000 |
| Cultivator Tier I | 239 | $3,000 | $717,000.00 |
| Cultivator Tier II | 195 | $10,000 | $1,950,000 |
| Cultivator Tier III | 155 | $20,000 | $3,100,000 |
| Processor | 333 | $5,000 | $1,665,000 |
| Safety Compliance Facility | 5 | $3,000 | $15,000.00 |
| $27,827,000 |
Licenses will be assigned through a lottery system, except for those for safety compliance facilities. The lottery will be conducted no earlier than October 2024. The Kentucky Office Medical of Cannabis will first review all applications to determine which meet the technical requirements of the application process and then provide any deficient application a period of 10 days to cure any mistakes. Should the application be ultimately rejected, applicants have the ability to seek an administrative hearing.
In the interim between submission of applications and the issuance of licenses, applicants also may need to navigate changes in local law, as communities consider whether to opt out or opt in to medical cannabis. Kentucky’s state law allows local governments to restrict cannabis or to regulate the time, manner, and place of those businesses. Counties are automatically opted “in” to allow cannabis business. A current map showing the local choices is available here.
Kentucky’s medical cannabis program begins on January 1, 2025, but much remains uncertain in the months before then, notably who will be involved and where operations will be. As those and other questions linger in the air — including the impact on employers, the financial services industry, commercial real estate, zoning, and others — SKO is available to assist. SKO attorneys have facilitated the submission of applications to the Kentucky Office of Medical Cannabis, and we look forward to assisting you in the next steps of the licensing process and all other issues pertaining to medical cannabis in the Commonwealth.
