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<\/figure>\n<\/div>\n\n\nGov. Ron DeSantis\u2019 administration in December hiked the fee, which had been $60,000 since the inception of the state\u2019s medical marijuana program six years ago. The increase came after the governor complained that marijuana companies \u2014 whose licenses have sold for upwards of $50 million until recently \u2014 weren\u2019t paying enough.<\/p>\n\n\n\n
Sanctuary Cannabis, one of 24 medical marijuana operators in the state, in September filed an administrative challenge in arguing that the $1.33 million biennial fee is \u201cwholly without logic or reason\u201d because it does not take into account tens of millions of dollars from patients who pay $75 a year for identification cards to participate in the program.<\/p>\n\n\n\n
Lawyers for the Department of Health, however, maintain that the formula reflects decisions by state lawmakers.<\/p>\n\n\n\n
Florida law says the department must adopt rules \u201cestablishing a procedure for the issuance and biennial renewal of licenses, including initial application and biennial renewal fees sufficient to cover the costs of implementing and administering\u201d the medical marijuana program.<\/p>\n\n\n\n
The disputed rule adopted in December created a formula basing the renewal fee on the number of operators, known as medical marijuana treatment centers, and the cost to regulate the program.<\/p>\n\n\n\n
Sanctuary Cannabis and the health department laid out their final arguments in the dispute in documents filed Tuesday at the state Division of Administrative Hearings.<\/p>\n\n\n\n
Along with being able to set the renewal fee and charge patients for identification cards, state law allows the health department to levy fines against medical marijuana operators. Sanctuary attorneys wrote the money is \u201cintermingled\u201d in a trust fund.<\/p>\n\n\n\n
The law doesn\u2019t require operators to \u201cbear the brunt\u201d of the cost of regulating the industry, lawyers Will Hall and Daniel Russell of the Dean Mead firm argued.<\/p>\n\n\n\n
Interpreting the law \u201cas requiring the department to ignore identification card fees and MMTC (medical marijuana treatment center) fines in determining a sufficient license renewal fee amount does not reasonably comport with the totality of the statute,\u201d they wrote.<\/p>\n\n\n\n
The law \u201cas a whole makes clear that the department should use and consider all of those funds for its administrative purposes, then set MMTC license application and renewal fees at amounts that would make up for any potential revenue shortfall,\u201d the Sanctuary lawyers argued in a proposed final order.<\/p>\n\n\n\n
But attorneys for the health department said the fee-setting rule carries out an \u201cunambiguous statutory directive.\u201d<\/p>\n\n\n\n
Sanctuary\u2019s challenge \u201cis premised on assumptions and suppositions that have no legal basis,\u201d Ed Lombard, an attorney who represents the agency, said in a proposed final order.<\/p>\n\n\n\n
\u201cSanctuary assumes that the Legislature intended for the implementation and administration\u201d of the law \u201cto be a \u2018net zero\u2019 operation for the state, meaning that the revenue and costs associated with the program are equal,\u201d Lombard wrote.<\/p>\n\n\n\n
\u201cWhether the Legislature intended a \u2018net zero\u2019 program or not, the statute authorizing the renewal fee is silent on that issue and could not be any clearer. The statute simply does not give the department authority to reduce the renewal fees by crediting fines imposed on MMTCs and fees collected for patient\/caregiver identification cards,\u201d he argued.<\/p>\n\n\n\n
Decreasing the renewal fee by taking into account all other sources of revenue \u201ccould reduce the renewal fee below zero,\u201d which would be contrary to the law, Lombard wrote.<\/p>\n\n\n\n
\u201cThus, under Sanctuary\u2019s proffered statutory framework, there would be no basis for the department to impose any renewal fee at all. Sanctuary cannot advocate a statutory interpretation only to abandon it when the interpretation proves too much,\u201d he added.<\/p>\n\n\n\n
The \u201cplain language\u201d of the law requires health officials \u201cto set application fees at an amount sufficient to cover the costs of implementing and administering\u201d the medical marijuana program, the department\u2019s proposed order said.<\/p>\n\n\n\n
\u201cThis is a legislative policy decision that cannot be disregarded,\u201d Lombard wrote.<\/p>\n\n\n\n
Sanctuary\u2019s petition for an administrative hearing relied heavily on a budget request the department submitted to the Legislature for the 2024-2025 fiscal year, which will begin in July.<\/p>\n\n\n\n
The agency collected $14.9 million in application and renewal fees for licenses and nearly $65 million from patients and caregivers during the 2022-2023 fiscal year, which ended in June. More than 854,000 patients are qualified for the program.<\/p>\n\n\n\n
The agency, which also gets money from testing labs and fines, collected roughly $84 million that year, anticipates collecting the same amount this year and projects receiving $114 million in 2024-2025, according to the budget request.<\/p>\n\n\n\n
The agency also reported having a $16.3 million surplus during the 2022-2023 fiscal year and projected surpluses of nearly $4 million this year and $61 million in 2024-2025.<\/p>\n\n\n\n
The fee increase came after DeSantis said medical marijuana operators need to spend more for the opportunity to do business in Florida.<\/p>\n\n\n\n
The state \u201cshould charge these people more,\u201d DeSantis told reporters in August 2022.<\/p>\n\n\n\n
\u201cI mean, these are very valuable licenses,\u201d the governor told reporters. \u201cI would charge them an arm and a leg. I mean, everybody wants these licenses.\u201d<\/p>\n\n\n\n
Many operators in Florida and the rest of the country, however, have struggled with finances because marijuana remains illegal under federal law, which creates banking hurdles and forces companies to pay higher corporate income taxes.<\/p>\n\n\n\n
Administrative Law Judge William Horgan is handling the Sanctuary challenge.<\/p>\n","protected":false},"excerpt":{"rendered":"
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