Getting a license to grow marijuana in Missouri would have been life changing for Shannon Low, a chance to secure a stable future for his family.
When the Missouri Department of Health and Senior Services began accepting applications for newly created micro-licenses intended to help underserved groups join the marijuana market, Low, who owns a marijuana gardening supply business in Joplin, paid the $1,500 application fee.
His mother and his business partner also submitted applications.
But instead of the opportunity he had hoped for, trying to participate in Missouri’s marijuana program has taken a financial toll on Low and his family. After being denied a chance to join the industry in October, he learned this month that he was ineligible for a refund on his application fee.
“I straight up feel scammed by my own state,” Low said in a phone interview. “It’s the darndest thing — I’ve always been really proud to be a Missouri citizen.”
While the state has regularly touted the fact that applicants who were denied a license through the state-run lottery were eligible for a refund — there are a few caveats. Individuals who were denied a micro-license because they did not meet the program’s criteria are barred from receiving a refund, said Lisa Cox, the spokesperson for DHSS.
This includes those who applied for more than one license and people who were denied after being ranked highly in the state-run lottery, Cox said. She said seven applications were denied for these reasons and would be ineligible for refunds.
Since Low appeared as a partial owner on three applications — his, his mom’s and his business partner’s — the state considered him in violation of a rule that said “An entity may apply for and obtain only one (1) license to operate a microbusiness facility.”
“If an entity, which includes an individual, holds an ownership interest in more than one microbusiness license applicant in the same microbusiness application period, all microbusiness applications where the entity holds an ownership interest will be denied,” the rule said.
Cox said the agency had made this rule clear, but Low said the move to deny him a refund for an honest mistake has caused him to lose faith in the state’s new marijuana industry.
The program for underserved groups to break into Missouri’s weed industry has been plagued by controversy.
While hundreds of small-time applicants lost out on the chance to grow legal weed, an out-of-state company accused of predatory practices recently listed for sale licenses that went to two LLCs in Missouri. The state also awarded another license to a company based in New Jersey. And reporting from the Missouri Independent showed that a few consulting firms were connected to hundreds of applications.
“The process has been so manipulated and I don’t see myself ever trying to get back in the actual recreational industry anytime soon,” Low said.
He said he attended a class on how to fill out the application and thought he was following the rules when he indicated a shared ownership among his partner, his mother and himself on all three applications.
The state health department last month awarded 48 marijuana micro-licenses divided across the state’s eight congressional districts after conducting a random lottery. Geared toward lower income individuals and minority groups, applicants had to meet one of several requirements, including having a net worth less than $250,000 or having a prior marijuana-related charge.
Low felt he qualified for the license because he has a net worth less than $250,000, he said.
Early last month, Low received an email from DHSS stating that his application for a micro-license had been denied.
A few weeks later, Low wrote an email to DHSS to clarify whether he was eligible for a refund.
“I was not aware that I broke any rules, we actually took a class on how to apply. My concern is that I will be denied my refund for this honest mistake?” Low wrote in the email earlier this month.
Low, in a follow up email, wrote that he did not intentionally violate the criteria for the license, saying that his family “cannot afford to lose the money” and that he was under the impression that he would be refunded if he was denied.
DHSS’s division of cannabis regulation emailed Low back last week, saying that he was not eligible to receive a refund.
“Your name appeared as an owner on three microbusiness applications, due to this you will not be eligible for a refund,” the email said.
John Payne, the campaign manager for the constitutional amendments to legalize both medical and recreational marijuana in Missouri, reiterated that the rules said an applicant could only list their name as an owner on one application.
“That’s a policy decision, ultimately, but it is in the rules,” he said in a phone interview.
But, Payne said, the department was supposed to notify applicants about incomplete or incorrect applications so the person could correct it. Payne said his big question is whether the state gave Low an opportunity to correct his application.
Cox did not respond to a follow up asking if DHSS offered Low this opportunity.
The $4,500 in fees for the three applications fees was a “pretty good chunk of change,” Low said in a phone interview. He said he took the money for his application out of his daughter’s college fund thinking that he was investing in something bigger for her.
“Honestly, it’s going to take me quite a while to replenish that money,” he said.
When asked what the state plans to do with the money kept from those who aren’t eligible for refunds, Cox said it would be used “no differently” than other fees associated with the program. The constitutional amendment that voters approved last year states that the fees would be used to cover operational expenses of the marijuana program.
The constitution details how additional money in the fund can be transferred, subject to approval from Missouri lawmakers, including to entities in charge of expunging marijuana-related criminal records and health care for Missouri veterans.
When Low began filling out his refund application, he noticed a line at the bottom of the form that said any pending or future legal actions related to the denial of a marijuana license would be dismissed if he submitted the form.
He said he hasn’t submitted or signed it.
“I cannot afford, really, to go hire an attorney myself, but I’m waiting and hoping that there will be some type of — maybe a class action lawsuit that I could join or something like that,” he said. “Why sign this piece of paper that guarantees I cannot be part of a lawsuit if I already know I’m going to be denied?”
H/T: www.kansascity.com
