RULES ABOUT MEDICAL MARIJUANA IN ARIZONA RELEASED

The state health department on Monday released its final version of
medical-marijuana rules, which detail how dispensaries will be chosen
and distributed throughout the state.

The release wraps up the state health department's four-month
rule-making process. Arizona's medical-marijuana program officially
begins April 14, when the Arizona Department of Health Services will
begin accepting patient applications. The program should be fully
functioning by the end of the year.

In November, voters passed Proposition 203, which will allow
qualifying patients with certain debilitating medical conditions to
receive up to 2 1/2 ounces of marijuana every two weeks from
dispensaries or cultivate up to 12 marijuana plants if they live 25
miles or farther from a dispensary. There will be between 120 and 126
dispensaries throughout the state, proportionate to the number of pharmacies.

Since early February, the state health department received more than
1,450 electronic comments on the second draft of its rules. The
agency held four public forums - in Flagstaff, Tempe and Tucson -
where about 150 people gave input on the rules.

"Ultimately, whether it becomes recreational over time is directly
related to whether physicians across the state take this seriously
and really make full assessments of patients, and only write
certifications for people who really do have debilitating medical
conditions," said Will Humble, ADHS director.

Humble said one of the main problems he expects in the first couple
of weeks of the program is patients submitting doctor certifications
that are incomplete or not in the department's accepted electronic
format. Several doctors have been writing medical-pot certifications
before the department finalized its rules.

"(The patients have) been walking away with sheets of paper that they
believe are certifications that we'll accept. The fact is, we will
only accept certifications that are on the department-provided form,"
Humble said.

The main changes made to the final version relate to selecting and
distributing dispensaries:

. Dispensary selection

The final version builds on the previous draft's proposed two-step
process of approving applications. Dispensary agents will be required
to first apply for a registration certificate, which would include a
background check and basic information such as location. The agent
then will apply for an operating license, which requires more
detailed plans, such as a site plan and a certificate of occupancy.

ADHS has added more requirements to the first application step. For
example, applicants must include a business plan that shows projected
expenditures before and after the dispensary is operational, and the
projected revenue.

The final rules make it easier for dispensary owners to change
locations within their designated health area.

. Dispensary distribution

There will be one dispensary in each Community Health Analysis Area,
a geographical breakdown of the state that the DHS previously used to
track public-health statistics. There are 126 of these health areas
in the state, close to the number of dispensaries allowed.

If there is one qualified applicant for one health area, the
department will approve the dispensary. But if there is more than one
qualified application for the same health area, prospective
dispensaries will be evaluated on a set of standards: whether the
dispensary has access to $150,000 in start-up capital; whether the
applicant has been bankrupt; whether anyone with a 20 percent or more
interest in the dispensary is a board member or a principal member;
whether the applicant is a resident of Arizona for three years; and
whether the applicant has outstanding fees, such as federal, state
and local taxes and child support.

If the applicants all rank the same, the department will choose
dispensaries randomly.

One of the reasons this provision was included in the final rules was
to encourage applicants to set up shop in rural areas of the state,
Humble said. If applicants do not meet the standards, they will have
a better chance applying for a less competitive health area. After
three years, dispensary owners can apply to move to a different
health area, perhaps inside the Valley.

Read the rules at www.azdhs.gov/prop203