NOTE: The response by governmental entities to Covid-19 is rapidly developing and subject to change at any time without notice. The information within this report is current only through March 19, 2020.

Many states and municipalities are considering whether businesses that provide access to cannabis should be designated an "essential service" in the face of the COVID-19 pandemic. Essential services are those services and functions that are necessary, even during a pandemic, to maintain the health and welfare of the public. States and municipalities have different priorities for what constitutes an essential service, but most include essential infrastructure, transportation services, grocery stores, hardware stores, laundry services, banks, health care operations and pharmacies.

Access to cannabis used for medical purposes varies greatly state to state. In medical cannabis states, registered medical cannabis patients have little or no choice but to obtain their medicine through licensed dispensaries. In adult-use states such as California and Colorado, many who use cannabis for medical purposes obtain it through adult-use retail stores and delivery services. Regardless of the distribution model, a strong argument can be made that access to cannabis through retail stores and delivery services should be included as an essential service and remain available to the public during the crisis.

In addition to the angst of medical patients who fear losing access to their medicine, many cannabis businesses know that lengthy shelter-in-place orders and other mandatory closures pose an existential threat to the industry, which is overwhelmingly composed of small businesses that are already faced with expensive compliance costs, high taxes and razor thin profit margins.

Within the past few days, several states and municipalities have responded publicly by identifying cannabis operations as essential businesses that may remain open. Others have modified their policies regarding delivery services. Following is a breakdown of select jurisdictions that have responded to the current crisis.

California

On March 19, 2020, an emergency order was issued by Governor Gavin Newsom ordering all 40 million California residents to stay at home and not work, except for essential services, which are defined in the order as the 16 critical infrastructure sectors identified by the Cybersecurity and Infrastructure Security Agency (CISA). Although cannabis is not identified specifically within the CISA list, the order identifies certain services as essential, including food, prescriptions and health care.

In support of the governor's order, the California State Public Health Officer and the California Department of Public Health have released a list of essential critical infrastructure workers. Cannabis retailers are listed as part of the essential workforce under the category of workers in other medical facilities. In addition, "workers supporting cannabis retail and dietary supplement retail" are listed as essential workforce within the food and agriculture sector.

California's Bureau of Cannabis Control has sent a notice clarifying that "because cannabis is an essential medicine for many residents, licensees may continue to operate at this time so long as their operations comply with local rules and regulations." Cannabis businesses must implement social distancing measures.

In addition to the state order, multiple cities and counties within California have issued orders that explicitly include cannabis as an essential service. These include Los Angeles, San Francisco, Palm Springs, Orange County and Los Angeles County.

Colorado

On March 16, 2020, Governor Polis ordered the closure of all Colorado restaurants and bars to in-person dining. The state has not yet issued guidance that may impact marijuana businesses, though Governor Polis has indicated that Colorado will treat cannabis dispensaries the same as other pharmacies. Notably, both Summit and Gunnison counties issued their own, more restrictive closure ordinances, but both permitted marijuana dispensaries to remain open, along with banks, grocery stores, pharmacies and certain other services.

Florida

On March 16, 2020, Emergency Order 20-002 was enacted to temporarily allow qualified physicians to use telemedicine to recertify medicinal cannabis certifications for qualified patients. Unless extended, the Emergency Order will be in effect for only 30 days, and qualified physicians may not use telemedicine to certify any patients after April 15, 2020.

At this time, it is unclear whether there is a pending statewide decision to shut down nonessential businesses. The City of Miami Beach has shut down nonessential businesses, which excludes pharmacies, grocery stores, convenience stores, private offices, banks, hotels, hospitals, medical service providers, medical supply stores, hardware stores, gasoline service stations and automotive supply/repair centers. While state dispensaries are not specifically identified, it is likely they are excluded based on these terms.

Illinois

On March 16, 2020, the Illinois Department of Financial and Professional Regulation issued guidance to help stop the rapid spread of COVID-19. That guidance specifically recognizes that "medical cannabis patients may be particularly vulnerable to COVID-19 due to preexisting conditions." In light of this, the state granted an emergency variance to allow cannabis dispensaries to service medical cannabis patients and designated caregivers outside "limited access areas" until March 30, 2020, provided the dispensaries follow these specific protocols:

  • The exchange of cash and product must take place on the dispensary's property or on a public walkway or at the curb of the street adjacent to the dispensary. No delivery is permitted.
  • The patient or caregiver's card must be scanned prior to purchase and the purchase must be tracked in the state traceability system.
  • Cash must be taken into the dispensary after each transaction.
  • Security must be present for outdoor exchanges.

The variance does not apply to adult-use purchases.

The guidance further calls for dispensaries to ensure patients, caregivers and purchasers remain more than six (6) feet from other patrons while in line and within the dispensaries.

The guidance also includes sanitary practices, requiring dispensaries to remain vigilant in their observance. This includes allowing agents to wash their hands frequently throughout the day and to provide an ample supply of hand soap. All surfaces that patients are required to touch must be disinfected at least every 30 minutes. Dispensaries also are urged to post their sanitation protocols and inform patients and caregivers of the measures being taken. Department inspectors will be watching cameras daily to ensure compliance with regular laws and this new guidance.

The guidance document can be found on the website of the Illinois Department of Financial and Professional Regulation.

Massachusetts

The Cannabis Control Commission has not issued any guidance on marijuana sales during the COVID-19 pandemic. The Commission's staff is working remotely, and allowing doctors to renew medical marijuana certifications over the phone and by video so long as the patient was seen in person within the past year. The Commission also is encouraging medical dispensaries to expand medical delivery while recreational delivery is still coming online. While there are reports of adult-use customers trying to stockpile marijuana, the Commission has allowed the dispensaries to decide how to manage customers on their own. In compliance with social distancing, some dispensaries are requiring that customers place orders before arriving at the dispensary. Patient groups are advocating that cannabis businesses be designated "essential."

Michigan

On March 16, 2020, the Marijuana Regulation Agency of Michigan (MRA) published an advisory bulletin modifying its home delivery policy for both medicinal and adult-use businesses. The MRA has publicly encouraged home delivery services and has temporarily allowed curbside pickup. The MRA also allows home delivery for patients and customers whose current residential addresses do not match the addresses on their state-issued identification cards. The MRA requires that each marijuana establishment first seek approval for their delivery procedure. A 24- to 48-hour time frame has been announced for its approval process.

Nevada

On March 17, 2020, Governor Steve Sisolak issued guidance for a 30-day shutdown of Nevada businesses and social life. Cannabis dispensaries are permitted to remain open if employees and customers strictly comply with social distancing protocols. Nevada's social distancing guidelines require that dispensaries ensure that each person stays six (6) feet distant from others. The Nevada Health Response Center also is encouraging consumers to use delivery services and not congregate in stores.

New York

On March 19, 2020, Governor Cuomo issued an Executive Order requiring all businesses to use telecommuting or work from home procedures to the maximum extent possible, with the exception of essential businesses. On March 17, 2020, the New York State Department of Health issued guidance identifying registered organizations in the state's medical marijuana program as essential businesses during the COVID-19 pandemic. (Notably, New York does not yet have an adult-use commercial cannabis program.)

In the event that nonessential businesses are forced to shut down, the Department has granted permission for registered organizations in the state's medical marijuana program to remain open since they are considered medical providers. The Department acknowledges that "many registered medical marijuana patients may have severe debilitating or life-threatening conditions and are immunocompromised." As a result, the Department has announced modifications to its dispensing and home delivery policies.

Regarding dispensing, registered organizations are allowed to dispense medical marijuana products at their dispensary doors to limit potential exposure to their staff and other patients. In doing so, each dispensary still must comply with all current laws, rules and regulations.

Regarding home delivery, the Department directs that until April 16, 2020, registered organizations approved to deliver medical marijuana products to the homes of patients and caregivers are permitted to expand their delivery services without seeking the Department's prior written approval. However, it is recommended that drivers:

  • Wear masks and gloves while making deliveries
  • Sanitize their hands after each delivery
  • Encourage patients to use their own pens when a signature is required.

Registered organizations are allowed to confirm receipt of the delivered medical marijuana products by the patient or caregiver through a phone call, text or email in lieu of obtaining a signature so long as the confirmation is documented and retrievable upon audit.

Oregon

On March 16, 2020, Governor Kate Brown issued an order allowing businesses, including recreational and medical marijuana dispensaries, to remain open at their own discretion. Businesses are required to implement strong social distancing measures and close temporarily until a reliable policy is in place.

Pennsylvania

While the Department of Health has strongly encouraged bars and restaurants to close, medical marijuana dispensaries have been permitted to remain open. (Notably, Pennsylvania does not yet have an adult-use commercial cannabis program.) A health department spokesperson recently told the Philadelphia Inquirer that "medical marijuana dispensaries are considered pharmacies and therefore considered essential businesses." Although home delivery is prohibited in Pennsylvania, the Department of Health has announced that it is "considering options to assist patients during the COVID-19 response."

Washington

On March 17, 2020, the Liquor and Cannabis Board issued guidance in response to the COVID-19 pandemic. Following Governor Jay Inslee's proclamation shutting down restaurants, bars, coffee shops or a slew of other public venues where people congregate, Director Rick Garza sent an email bulletin to industry members explaining marijuana retailers are not required to close. The guidance echoed take-out requirements for restaurants and curbside pickup variances permitted to alcohol licensees and temporarily allows "cannabis retailers to sell to qualifying patients or their designated providers outside of their business but within the licensed property line." This essentially permits curbside pickup for marijuana patients. Restrictions, however, prohibit drive-through windows. Moreover, qualified patients and designated providers must be valid medical marijuana cardholders and registered with the state's Department of Health.

Conclusion

The cannabis industry has faced other crises. Most recently, the industry vigorously responded to and successfully weathered the vape crisis during the fall of 2019. The COVID-19 pandemic, however, presents a more immediate and potentially existential threat to a wide cross-section of cannabis businesses. Developments occur rapidly and we expect additional jurisdictions to make decisions on medical cannabis as an essential service within the coming days.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.