Ala. Admin. Code r. 538-X-9-.03

Current through Register Vol. 43, No. 1, October 31, 2024

Section 538-X-9-.03 - [Effective until 11/14/2024] Applications and Applications Processing As To Integrated Facilities

(1)Generally. Applicants for a license to operate as an Integrated Facility under the Act and these Rules shall be governed by the Rules for filing applications and seeking a license contained in Chapter 3 (538-X-3-.01, et seq.), except as specifically modified below.

(2)Procedure for Filing Application - Contents of Application Specific to Integrated Facilities. An Integrated Facility's application filed with the Commission shall conform to the following requirements common to all licensees set forth in 538-X-3-.05 of Chapter 3 of these Rules, as well as any rules regarding information to be provided at the time of application applicable to Cultivators promulgated by the Department at Administrative Code 80-14-1-.01, et seq., except as noted below:

(a) Cover Sheet - as provided in 538-X-3-.05 of Chapter 3 of these Rules.

(b) Summary Sheet - as provided in 538-X-3-.05 of Chapter 3 of these Rules.

(c) Application Information - as provided in 538-X-3-.05 of Chapter 3 of these Rules, except as provided otherwise below:

1. The Integrated Facility Applicant's Verification regarding each business entity that has any ownership interest in the applicant shall conform with paragraph 3.a. of Rule 538-X-3-.05 of Chapter 3 of these Rules.

2. The Integrated Facility Applicant's Verification regarding individuals having any ownership interest in the applicant, as to the identity, street address and responsible person of all entities with which the individual is connected, to the extent the entity is directly or indirectly involved in the cannabis industry, shall conform with paragraph 3.b. of Rule 538-X-3-.05 of Chapter 3 of these Rules.

3. The Integrated Facility Applicant's Verification regarding any criminal history as to any owner, director, board member, or individual with a controlling interest in the applicant shall conform with paragraph 3.c. of Rule 538-X-3-.05 of Chapter 3 of these Rules.

4. The Integrated Facility Applicant's verified licensing history, cannabis industry history, and tax history regarding itself or any affiliate shall conform with paragraphs 3.d., 3.e., and 3.f. of Rule 538-X-3-.05 of Chapter 3 of these Rules.

5. The Integrated Facility Applicant's Verification regarding any public officials having any interest in the applicant shall conform with paragraph 3.g. of Rule 538-X-3-.05 of Chapter 3 of these Rules.

6. The Integrated Facility Applicant's statement of the anticipated or actual number of employees shall conform with paragraph 3.h. of Rule 538-X-3-.05 of Chapter 3 of these Rules.

7. The Integrated Facility Applicant's statement of the number of days, if awarded a license, within which it will commence operations and reach full capacity shall conform with paragraph 3.i. of Rule 538-X-3-.05 of Chapter 3 of these Rules.

8. The Integrated Facility Applicant's consent to the inspections, examinations, searches and seizures contemplated by § 20-2A-52(a)(3), Code of Ala. 1975, (as amended) shall conform with paragraph 3.j. of Rule 538-X-3-.05 of Chapter 3 of these Rules.

9. The Integrated Facility Applicant's verification of the permissibility of its facilities' locations and compliance with all State and local laws shall conform with paragraph 3.k. of Rule 538-X-3-.05 of Chapter 3 of these Rules.

10. The Integrated Facility Applicant's Verification that it and its leadership have no economic interest in any other license or Applicant for license under the Act or these Rules shall conform with paragraph 3.1. of Rule 538-X-3.05 of Chapter 3 of these Rules.

(3)Procedure for Filing Application - Exhibits to an Integrated Facility Application. Exhibits to the Integrated Facility Applicant's application information shall include all those as provided in subparagraphs 3.m.(1) through 3.m.(16) 538-X-3-.05 of Chapter 3 of these Rules, as well as any rules regarding documentation or exhibits to be filed at the time of application applicable to Cultivators promulgated by the Department at Administrative Code 80-14-1-.01, et seq., and shall also provide the following, unless specifically provided otherwise as follows:

(a) Minimum Performance Bond Requirements.

1. At the time of application, an Integrated Facility Applicant must provide a letter of commitment or other form of acknowledgement approved by the Commission (i.e., executed bond documents, proof of capital in the required amount, or other similar verifying documentation), of the ability to secure a performance bond issued by a surety insurance company acceptable to the Commission, possessing at minimum an A rating, in the amount of at least two million dollars ($2,000,000).

2. Said performance bond must have been secured by the Integrated Licensee at the time a license is issued.

(b) Minimum Liquid Assets Requirement. Proof of at least two hundred fifty thousand dollars ($250,000) in liquid assets, available at the time the license is issued.

(c) Minimum Operating Capital Requirement. Proof that the applicant has the financial ability to maintain operations for not less than two years following the date the application is accepted by the Commission.

(d) Plan for Segregation of Processes Within and Transportation Between Facilities. An Integrated Facility applicant must provide a plan for keeping strictly separated all aspects of production, including cultivation of cannabis, the processing of medical cannabis, the dispensing of medical cannabis, and the secure transport of medical cannabis to and from its facilities.

(e) Integrated Facility applicants must provide, as available, sales contracts and receipts, lease agreements or other documentation demonstrating possessory interest in all machinery and equipment to be used in the processing of medical cannabis, as well as specifications and operations manuals of such machinery.

(f) Integrated Facility applicants must:

1. identify which of the approved types of medical cannabis will be produced at each facility where cannabis is to be processed,

2. provide a summary of the manufacturing processes and methods to be utilized to produce each product, including the machinery, equipment, materials, and personnel necessary to produce each product,

3. provide a professionally-rendered blueprint (or if not available, professionally rendered floorplans or schematics) showing which portions of each of its facilities are ascribed to a particular phase or department of integrated production - cultivation, processing, transporting, and dispensing (or, as applicable, none of the foregoing).

4. identify specific plans to ensure safety of personnel and facilities based on the types of processes proposed to be utilized, and

5. provide a detailed list of formulae and ingredients for each medical cannabis product, including a list of all excipients to be utilized in the manufacture of each product, and the purpose served by each.

(g) Integrated Facility applicants must provide a quality control and quality assurance plan for each of their proposed medical cannabis products identifying:

1. An overview of the steps to be taken in the manufacturing process to provide high quality products and/or to ensure the safety, potency, stability, lifespan, and consistency among batches of the same product, whether as required by law or otherwise.

2. What tests will be conducted, if any, at each stage or stages of production.

3. Whether the testing at each stage will be in house, unofficially by private testing through a State Testing Laboratory, or solely by official testing through a State Testing Laboratory.

4. A plan for return and remediation or destruction of any failed test samples, including entry of the event on the Statewide Seed-to-Sale Tracking System.

(h) Integrated Facility applicants must provide:

1. A curriculum vitae for the business, demonstrating the education, experience, and other credentials of its leadership, including but not limited to all scientists and engineers employed at each facility.

2. A detailed explanation of the role each leader, scientist or engineer is to have in the processing of medical cannabis at each facility.

3. A 5-year hiring plan for its leaders, scientists, and engineers, identifying the types, positions, required education, required experience, and expected roles of such personnel.

(i) Integrated Facility applicants must provide copies of all contracts, contingent contracts, memoranda of understanding (or, if none of the foregoing are available, exemplars) between themselves and:

1. Any Cultivator or prospective Cultivator.

2. Any Secure Transporter or prospective Secure Transporter.

3. Any State Testing Laboratory or prospective State Testing Laboratory.

4. Any Dispensary or prospective Dispensary.

5. Any Processor or prospective Processor.

6. Any other Integrated Facility or prospective Integrated Facility.

(j) Integrated Facility applicants must create a receiving and shipping plan that, at a minimum, ensures the following, in coordination with the contracted Secure Transporter or State Testing Laboratory, as applicable:

1. Individual batches of cannabis being received for storage and/or processing were appropriately prepared, tagged or otherwise identified, and inserted in containers at the time of receipt.

2. Batches and containers arriving from the cultivator have been QR coded or otherwise digitally coded to identify, at a minimum, the Cultivator, facility, plant tag identification number, date of harvest, and the date of the cultivator's State Laboratory testing approval.

3. Incoming cannabis is accompanied by the Secure Transporter's manifest and other appropriate documentation; the information thereon is accurate and has been duly executed by all appropriate parties.

4. All information from the QR code relating to the incoming cannabis, as well as the date and time of arrival, has been logged into the Statewide-Seed-to-Sale Tracking System.

5. Individual batches of medical cannabis products being shipped from a facility operated by an Integrated Facility to a Dispensary or Cultivator by means of a Secure Transporter must be appropriately packaged, labeled, and inserted in containers prior to transport.

6. Batches and containers being shipped from the Integrated Facility's facility must be QR coded or otherwise digitally coded to identify, at a minimum, the Integrated Facility, facility, type of product, date of processing and packaging, and the date of the Integrated Facility's State Laboratory testing approval(s).

7. Outgoing medical cannabis is accompanied by the Secure Transporter's manifest and other appropriate documentation; the information thereon is accurate and has been duly executed by all appropriate parties.

8. All information from the QR code relating to the outgoing medical cannabis, as well as the date and time of shipment, has been logged into the Statewide-Seed-to-Sale Tracking System.

(k) Integrated Facility applicants must provide a marketing and advertising plan, if any, including:

1. Any proposed logos, branding, messaging, or other marketing or advertising communications, providing exemplars of any specific advertisements.

2. Any specific media outlets or platforms where the marketing or advertising campaigns or programs will be utilized.

3. The identity of any media outlet or third-party individual or entity who is projected to play any role in the Integrated Facilities' marketing or advertising efforts, and copies of all contracts or contract forms proposed for use, if any, between itself and such media outlet or third-party individual or entity.

4. Virtual renderings of all packaging to be provided by the Integrated Facility, demonstrating the size, color, logo, artwork, or statements appearing on the packaging, as well as all child-resistant, tamper-evident, or other safety features, demonstrating conformity with the Act and these Rules.

5. Exemplars of all proposed labeling, including labels on packaging, on containers and any inserts to be included in any packages, demonstrating conformity with the Act and these Rules.

(l) Integrated Facility applicants must provide a detailed recall plan that will be followed in the event one or more of its products, including any lots or batches thereof, is determined to require recall. The plan must include, but should not be limited to, the following:

1. Provisions for notifying the Integrated Facility of an adverse event;

2. Factors about an adverse event that would likely necessitate a recall, and any potential for retesting or remediation;

3. Responsible individuals or positions within the Integrated Facility's organization who will oversee the recall process;

4. Notification protocols to other licensees and the Commission through the Statewide Seed-to-Sale Tracking System;

5. Processes to ensure that the recalled product is returned, remediated (and approved as safe), or destroyed;

6. Processes to report to the Commission and any other appropriate regulatory body regarding crisis response and steps taken to mitigate or avoid danger to the public;

7. Steps to be taken to avoid further contamination, to preserve and protect uncontaminated cannabis or medical cannabis products, and to ensure access to said products by those who depend on it;

8. Investigation and analysis of the factors that led to the unsafe condition requiring the recall, and any adjustments to internal protocols and processes to avoid recurrence.

(m) The Integrated Facility Applicant's Security Plan must include a plan for security at each facility, including but not limited to the following:

1. Twenty-four-hour alarm systems must be installed in all facilities where cannabis or medical cannabis products are present. Such alarms shall be provided and installed by experts in industry-standard commercial-grade alarm systems. Alarm systems must be fully operational, securing all entry points and perimeter windows, be equipped with motion detectors and pressure switches, and must cover all areas where cannabis or medical cannabis products are delivered, received, handled, stored, prepared, processed, tested, packaged, labeled, or readied for transport.

2. Reception areas and personnel adjacent to ingress and egress points shall have ready access to duress panic and hold-up alarms that may be activated in the event of access by unauthorized personnel or intruders.

3. Broadcast communication devices (cell phones, intercom equipment or the like) must be:

(i) Carried by each employee or installed in all areas of each Integrated Facility's facility designed for regular access by humans.

(ii) Accessible for communication by all personnel at all times, and particularly at perimeter ingress/egress stations, facility reception areas, and the security office.

(iii) Capable of providing information with sufficient clarity to be heard and understood by all personnel and visitors within earshot of the employee receiving the communication.

4. Integrated Facility licensee's facilities shall maintain an audio/video surveillance system that shall be in continuous operation 24 hours per day. Cameras shall be fixed in place covering both the interior and exterior of the facility operated by the Integrated Facility, in such quantity, with such lighting, and at such resolution as shall allow for the clear identification of individuals and activities in all reasonably accessible areas of the premises, including but not limited to all entrances, exits, parking lots, and any area where cannabis or medical cannabis is delivered, received, handled, stored, prepared, processed, tested, packaged, labeled, or readied for transport. Audio/Video surveillance recordings must clearly and accurately display the time and date, and audio recordings must clearly and accurately capture conversations and activities within camera range to a level of 20 decibels.

5. The perimeter and any outdoor premises of a facility operated by an Integrated Facility must be surrounded by a sufficient fence or barrier to prevent access by unauthorized persons and must have sufficient lighting to allow for the proper functioning of video surveillance equipment at all times between dusk and dawn or at any other time when ambient lighting requires enhancement to permit identification of individuals or activities upon or immediately adjacent to the premises. Indoor premises must likewise be sufficiently lit to allow for the identification of individuals and activities.

6. Exterior doors of each facility operated by an Integrated Facility must be designed or reinforced to withstand unlawful forcible entry; exterior doors shall remain locked against outside intruders at all times, while allowing free egress by the facility's occupants in the event of an emergency; doors must permit ingress to employees and other appropriate persons only by means of a keycard or other similar electronic access device.

7. Exterior walls of each facility operated by an Integrated Facility must be reinforced to withstand unlawful forcible entry. Windows, likewise, must be reinforced to prevent breakage by outside intruders.

8. Integrated Facilities applicants and licensees must provide and maintain a plan for sufficient staffing of security guards at each facility where cannabis and medical cannabis is present to reasonably ensure the safety of the products stored therein; however, the integrated facility must provide, at a minimum, one (1) security guard per facility during the facility's business/operating hours.

9. Strict access controls shall protect areas where cannabis or medical cannabis is handled or stored - in a secured, locked room or vault.

10. Records, whether electronic or manual, must be kept of all persons on the premises at a facility at all times, including employees, vendors, transporters or other licensees, and all others, recording the individuals' name, date, time of ingress and egress, and (as to non-employees) the reason for their presence; such records shall be kept for a minimum of two years, and longer at the request of the Commission or law enforcement.

11. Audio/Video surveillance records must be kept for at least 60 days, and longer upon the request of the Commission, its inspectors, or any law enforcement personnel. Audio/Video recordings potentially reflecting an incident of actual or attempted diversion must be kept for the longer of a period of two years, or until resolution of the incident and apprehension and discipline or prosecution of the individuals involved in the actual or attempted diversion.

12. Employees, while on duty, shall wear identification badges that clearly identify them as employees.

13. Visitors, including vendors, other licensees, Commission members, inspection personnel, or other representatives must wear a "visitor pass" or "AMCC Official" pass, as applicable, at all times while on the premises.

14. Integrated Facilities shall maintain, review and update policies to report theft, diversion, or other loss of cannabis products to the Commission and to law enforcement as early as practicable and not more than 24 hours from the event or its discovery.

15. Upon request, an Integrated Facility shall make available to the Commission or its inspectors all information relating to security alarm systems, monitoring, alarm activity, maps of camera locations and camera coverage, audio/video footage, surveillance equipment maintenance logs, authorized use lists, operation instructions, and any other security-related information deemed relevant by the Commission or its inspectors.

16. Upon request, an Integrated Facility shall make available to the Commission or its inspectors all information relating to the Integrated Facility's security plan.

(n) The Integrated Facility Applicant must provide an affidavit signed by the responsible individual and designated contact person (or, if the Integrated Facility is an entity, the duly authorized officer, owner or interest holder and the designated contact person) that the information provided in the Application is true and correct, to the best of the Affiants' knowledge upon a diligent investigation thereof.

(o) The Integrated Facility Applicant must provide the appropriate application fee as required by § 20-2A-SS(f), Code of Ala. 1975, (as amended). The application fee is nonrefundable and must be submitted electronically per instructions in the Application Form received in response to the applicant's Request for Application.

(4) In all other respects except as expressly stated otherwise in this Rule, Integrated Facility Applicants shall be governed by and must comply with the rules for applications and licensing generally pertaining to all applicants (Chapters 3 and 4 of these Rules); any rules promulgated by the Department applicable to cultivator applicants (See Administrative Code 80-14-1-.01, et seq.); and, as applicable to the aspect of the Integrated Facility's business, the specific requirements applicable to each type of licensee, as provided in Chapter 5 (cultivators), Chapter 6 (processors), Chapter 7 (secure transporters), and Chapter 8 (dispensaries) of these Rules.

Ala. Admin. Code r. 538-X-9-.03

Adopted by Alabama Administrative Monthly Volume XL, Issue No. 11, August 31, 2022, eff. 10/15/2022.

Author: William H. Webster

Statutory Authority:Code of Ala. 1975, §§ 20-2A-22, as amended.