On March 31, 2023, the governor of Kentucky signed bill SB 47 to legalize medical cannabis in the state. On April 17, 2024, Gov. Beshear signed the final version of HB 829 into law to start issuing medical cannabis licenses to businesses in July 2024.

Kentucky Cannabis Market

The Kentucky Cabinet for Health and Family Services is charged with the implementation, operation, oversight, and regulation of the medicinal cannabis program.

Kentucky Cannabis Business Licenses Types

 Responsible for planting, raising, harvesting, trimming, and curing raw plant material. A cultivator license authorizes its holder to grow medical cannabis in an enclosed, locked facility (such as a room, greenhouse, building, or other indoor enclosed area that is maintained and operated by a cultivator or producer and is equipped with locks and other security devices that permit access only by authorized agents of the cultivator or producer) and sell medical cannabis to a licensed medical cannabis processor, producer, or dispensary in Kentucky.

Tier I: <= 2,500 sq. ft; $3,000 application fee; $12,000 licensing fee; $50,000 capital requirement.
Tier II: <= 10,000 sq. ft; $10,000 application fee; $25,000 licensing fee; $200,000 capital requirement.
Tier III: <=25,000 sq. ft; $20,000 application fee; $50,000 licensing fee; $500,000 capital requirement.
Tier IV: <=50,000 sq. ft; $30,000 application fee; $100,000 licensing fee; $1,000,000 capital requirement.

Responsible for processing and packaging raw plant material into usable product formats. A processor license authorizes its holder to process raw plant material into medical cannabis products on its licensed premises in Kentucky. Processors may modify medical cannabis through extraction and other processing methods to develop various products for the medical-use cannabis market.

$5,000 application fee; $25,000 initial licensing fee; $15,000 annual renewal fee; $150,000 capital requirement.

Responsible for both planting, raising, harvesting, trimming, and curing raw plant material and for processing and packaging raw plant material into usable product formats. A producer license authorizes its holder to both grow and process raw plant material. A cannabis business licensed as a producer may operate cultivation and processing activities at separate locations, but shall not operate more than one cultivation and one processing facility per license.

$5,000 application fee; $25,000 initial licensing fee; $15,000 annual renewal fee; $150,000 capital requirement
+ the applicable cultivator fees.

Responsible for contamination and purity testing of raw plant material and medical cannabis products. A safety compliance facility license authorizes its holder to test samples of medical cannabis received from licensed cannabis businesses to ensure compliance with the testing requirements contained in 915 KAR 1:110. Safety compliance facilities verify that the medical cannabis products intended for sale in Kentucky are safe for use.

$3,000 application fee; $12,000 licensing fee; $150,000 capital requirement.

​ Responsible for selling finished medical cannabis products to cardholders. A dispensary license authorizes its holder to sell medical cannabis products from its licensed premises to registered qualified patients, designated caregivers, and visiting qualified patients. Dispensaries can only sell medical cannabis that has passed all required tests and was acquired from licensed cannabis businesses.

$5,000 application fee; $30,000 initial licensing fee; $15,000 annual renewal fee; $150,000 capital requirement.

Initially, the program will be issuing 10 Tier I cultivator licenses, 4 Tier II cultivator licenses, 2 Tier III cultivator licenses, 10 processor licenses, 48 dispensary licenses and safety compliance facility licenses.

Applicants cannot apply for more than one cannabis business license type.​ A cannabis business license is valid for one year from the date of issuance. The cabinet will notify each licensee 90 days prior to the date the license expires to allow the licensee to begin the renewal process.

Weed Delivery Service in Kentucky

Under HB 829, a dispensary may provide delivery services to cardholders and may deliver medicinal cannabis, medical cannabis accessories and educational materials to cardholders at the address listed on the cardholder’s registry identification.

Cannabis Delivery Service by State

Kentucky  Cannabis Licensing Process

Before you apply:

  1. Decide what kind of business you want to establish.
  2. Determine your potential location and look into the municipal regulations regarding cannabis business where you intend to establish your business.
  3. Check off all the requirements and documents on the Business Licensing Application Guide.
  4. Develop a cannabis business plan to estimate the start-up expenses and potential profitability. The business and financial plan for annual license applications shall include a full business plan, including at a minimum a description of the proposed business, the value proposition for consumers, an overview of proposed financing for the business, product and pricing plan, market analysis, and a complete profile of the management of the license applicant.

The application and review process will follow the timeline below:

  • Application Submission: Once the applicant submits an application and required documentation to the Program using the online application portal, the Program will acknowledge receipt of the application within 15 calendar days of submission.
  • Application Review: The Program will review each application to determine whether it is complete.  The Program will provide applicants with written notice of any deficiencies, errors, or missing information identified during the application review.  The Program will also alert applicants when it has determined an application submission is complete.
  • Curing of Deficiencies: After receiving a notice of application deficiencies, the applicant has 10 calendar days from the date of notification to resolve the identified issues and provide any missing information or documentation requested. Additional or corrected materials should be submitted through the same application saved in the licensing portal.
  • Acceptance or Denial: The Program will notify applicants whether their application has been approved or denied within 45 days of receiving an application and determining its complete.
  • Lottery: Accepted business applications will be entered into a licensing lottery for the selected cannabis business category if the number of eligible applications exceeds the maximum number of licenses available within that cannabis business category.​​

An applicant shall pay the required nonrefundable initial application fee at the time of application submission and provide information in a form and manner as prescribed by the Cabinet, which may include, but is not limited to the following:

Business Information

  • Business entity formation documents.
  • Site plan.
  • Financial plan, including budget and cash flow planning and debt management.
  • If applicable, summary of prior business experience.
  • Operational plan, including security; employee qualifications, supervision, and training; transportation of medicinal cannabis; storage and labeling of medicinal cannabis; inventory management; recordkeeping; preventing unlawful diversion of medicinal cannabis; and workforce development and job creation.
  • Timeline showing steps and estimated amount of time it will take to begin cannabis operations.
  • Documentation of sufficient capital available.
  • If applicable, management service agreement.

Applicant Information

  • Curricula vitae or resume of each principal officer and board member of the proposed cannabis business.
  • Ownership organizational structure document.
  • A description of the duties, responsibilities, and roles of each principal officer, board member, employee, and other individual or entity with financial interest in the business not involved in daily operations.

What is next:

  • If issued a license, the applicant shall pay the applicable license fee within 15 calendar days of notification.
  • If issued a license, the applicant shall conduct a criminal background check into the criminal history of each person seeking to be a principal officer, board member, agent, volunteer, or employee of the cannabis business.
  • The applicant shall obtain and maintain workers’ compensation insurance.
  • The applicant shall obtain and maintain commercial general liability insurance.
  • The applicant shall complete all trainings required by the Cabinet for cannabis business’s principals, agents, employees, and volunteers.
  • The applicant shall establish any standard operating procedures required by the regulations, including security; recordkeeping; employee qualifications, supervision, and training; quality assurance; adverse event reporting and recall; waste disposal and sanitation; transportation of medicinal cannabis; inventory management, including storage and labeling of medicinal cannabis; cash management and anti-fraud procedures; and preventing unlawful diversion of medicinal cannabis.

Kentucky Cannabis Taxes

Medical cannabis will be exempt from sales and excise taxes.


Cannabis Cultivation Business Plan Sample, Kentucky

Kentucky Cannabis Market

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