BLOG: Pennsylvania opening another round of medical marijuana business permits
Pennsylvania is getting set to open up applications for a second round of medical marijuana business permits, but a group of prominent York County residents that applied initially will likely not be among the new applicants.
Five-Leaf Remedies had applied for a grower/processor and dispensary permit, receiving a variance ordinance from York City Council to turn a warehouse at 213 E. Poplar St. into a medical marijuana growing/processing facility.
Investors — including local architect Frank Dittenhafer; Robin Rohrbaugh, president and CEO of the Community Progress Council; and Bobby Simpson, CEO of the Crispus Attucks Association of York — planned to spend more than $2.4 million to renovate the 35,000-square-foot facility.
None of the 12 available grower/processor permits available in the first round of applications were awarded to any company in York.
Knox Medical, a company based in Florida, received a permit to operate a medical marijuana dispensary in Penn Township.
The next round of applications will be available through the state Department of Health beginning April 5, and the department will close that window May 17, according to a notice in the PA Bulletin.
The department will be awarding up to 13 grower/processor permits and 23 dispensary permits, according to the bulletin.
April Hutcheson, a spokeswoman for the department, said the selection process will be the same as before, with applicants scored based on a variety of factors, including capital requirements, security and community impact.
One grower/processor permit will be granted to the applicant with the highest overall score and the other 12 will be split two apiece in each of six regions across the state, Hutcheson said.
York County is part of a 13-county region that includes Adams, Bedford, Blair, Cumberland, Dauphin, Franklin, Fulton, Huntingdon, Juniata, Mifflin, Lebanon and Perry counties.
That region will be allotted three more dispensary permits, according to the bulletin.
Christina Kauffman, a spokeswoman for Five-Leaf Remedies, wrote in a statement that the partners at the benefit corporation were unlikely to pursue a license during this new round without any indication these applications would be scored "with more transparency and higher value on local control and economic impact."
Five-Leaf's scores in the 1,000-point rating system were more than 100 points below those of the companies awarded permits in York County's region during the first round.
"The selections made during the first round telegraphed the focus (on) ... very deep corporate pockets with previous experience growing marijuana in another state," she wrote. "... We remain very proud of our first-round application."
She also noted that those involved with Five-Leaf invested months of work, lost more than $75,000 during the application process and received no feedback from the state to suggest any changes that would improve their score.
Five-Leaf wasn't alone in its criticism of the state's scoring system, as at least one lawsuit was filed against the department because of "inconsistent, arbitrary and mysterious application scores."
Keystone ReLeaf alleged that the department's scoring system was flawed, pointing to several irregularities in its own scores compared to other applicants' scores.
The lawsuit specifically cites the capital requirements scores as an example.
State law required dispensary applicants to have at least $150,000 in capital deposited in a financial institution. Though Keystone ReLeaf vastly exceeded this amount, the suit claims, it did not receive all the available points for the section.
Kauffman pointed out that, though Five-Leaf had "arguably the most diverse pool of investors," they were scored considerably worse on the "diversity" section of the application than a winning applicant that had only one African American on its team.
"In the absence of feedback explaining how that's possible, it's not clear what more we could do to improve our performance on diversity and other sections," she wrote.
Officials from Viridis Medicine, which had applied for a grower/processor permit to place a facility in Hellam Township, could not be reached about their interest level in the new round of applications.
— Reach Dispatch politics reporter David Weissman at firstname.lastname@example.org or on Twitter at @DispatchDavid. Like the blog on Facebook at The CannaBiz Kid.