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§ 118.01 APPLICATION.
   (A)   Section 110.02 does not apply to this chapter.
   (B)   The provisions in this chapter pertain exclusively to the licensure of medical cannabis establishments as governed by SDCL Ch. 34-20G.
(Prior Code, § 10-501) (Ord. 1346, passed 6-21-2021; Ord. 1355, passed 10-4-2021; Ord. 1371, passed 7-5-2022)
§ 118.02 DEFINITIONS.
   For the purpose of this chapter, the following definitions shall apply unless the context clearly indicates or requires a different meaning. Unless an alternative definition is explicitly stated in this section, this chapter utilizes the definitions for cannabis related terms which are defined by SDCL § 34-20G-1.
   APPLICANT. An individual or entity, or any principal, partner, officer, director, owner or member of an entity that applies for a cannabis establishment license.
   CANNABIS or MARIJUANA. All parts of any plant of the genus cannabis, whether growing or not, in its natural and unaltered state, except for drying or curing and crushing or crumbling. The term includes an altered state of marijuana absorbed into the human body. The term does not include fiber produced from the mature stalks of such plant, or oil or cake made from the seeds of such plant. The term does not include the plant Cannabis sativa L. and any part of that plant, including the seeds thereof and all derivatives, extracts, cannabinoids, isomers, acids, salts, and salts of isomers, whether growing or not, with a delta-9 tetrahydrocannabinol concentration of not more than 0.3% on a dry weight basis.
   CANNABIS CULTIVATION FACILITY. In addition to the definition in SDCL § 34-20G-1, this term is further defined as a legally licensed entity that acquires, possesses, cultivates, delivers, transfers, transports, supplies or sells cannabis and related supplies to a cannabis establishment.
   CANNABIS DISPENSARY. In addition to the definition in SDCL § 34-20G-1, this term is further defined as a legally licensed entity that is a retail type setting and acquires, possesses, stores, delivers, transfers, transports, sells, supplies or dispenses cannabis, cannabis products, paraphernalia or related supplies and educational materials.
   CANNABIS ESTABLISHMENT. Cannabis cultivation facility, a cannabis testing facility, a cannabis product manufacturing facility or a cannabis dispensary.
   CANNABIS ESTABLISHMENT, UNLICENSED . An entity that would otherwise meet the definition of a cannabis establishment, but which is not legally licensed by the city and does not have a current and valid registration certificate issued by the State Department of Health.
   CANNABIS PRODUCT MANUFACTURING FACILITY. In addition to the definition in SDCL § 34-20G-1, this term is further defined as a legally licensed entity that acquires, possesses, manufactures, delivers, transfers, transports, supplies or sells cannabis products to a cannabis dispensary.
   CANNABIS PRODUCTS. Any concentrated cannabis, cannabis extracts and products that are infused with cannabis, or an extract thereof, and are intended for use or consumption by humans. The term includes edible cannabis products, beverages, topical products, ointments, oils and tinctures.
   CANNABIS TESTING FACILITY. In addition to the definition in SDCL § 34-20G-1, this term is further defined as a legally licensed entity legally authorized to analyze the safety and potency of cannabis.
   LICENSE HOLDER. A cannabis establishment that possesses a license under this chapter to operate the cannabis establishment for which the license was issued.
   PUBLIC OR PRIVATE SCHOOL. Any preschool, elementary school, middle school, secondary school or high school. The term also includes any daycare or childcare center.
(Prior Code, § 10-501) (Ord. 1346, passed 6-21-2021; Ord. 1355, passed 10-4-2021; Ord. 1371, passed 7-5-2022)
§ 118.03 LICENSE REQUIRED.
   (A)   No cannabis establishment may be located or operate in the city without the appropriate valid and current cannabis establishment license issued by the city pursuant to this chapter. A violation of this provision is subject to the general penalty provision in § 10.99. Each day of the violation constitutes a separate offense.
   (B)   No cannabis establishment may be located or operate in the city without the appropriate valid and current cannabis establishment registration certificate issued by the State Department of Health pursuant to rules promulgated under SDCL Ch. 34-20G. A violation of this provision is subject to the general penalty provision in § 10.99. Each day of the violation constitutes a separate offense.
(Prior Code, § 10-502) (Ord. 1346, passed 6-21-2021; Ord. 1371, passed 7-5-2022) Penalty, see § 118.99
§ 118.04 LICENSE APPLICATION.
   (A)   An application for a cannabis establishment license must be made on a form provided by the city. No other application form will be considered.
   (B)   The applicant must submit the following:
      (1)   A non-refundable fee as set by resolution;
      (2)   An application that will include, but is not limited to, the following:
         (a)   The legal name of the prospective cannabis establishment;
         (b)   The physical address of the prospective cannabis establishment that meets the zoning requirements in § 156.046;
         (c)   The name and birth date of each principal, partner, officer, director, owner or member of the proposed cannabis establishment; and
         (d)   Any additional information requested by the city.
      (3)   Proof of a valid and current registration certificate issued by the State Department of Health.
   (C)   Each principal, partner, officer, director, owner or member of the cannabis establishment must meet the qualifications of a license holder.
   (D)   The city may be a license holder. The city’s application for a cannabis establishment license will be given preference over any other application.
(Prior Code, § 10-503) (Ord. 1346, passed 6-21-2021; Ord. 1355, passed 10-4-2021; Ord. 1371, passed 7-5-2022)
§ 118.05 ISSUANCE OF LICENSE.
   (A)   Once filed, the application will be referred to the appropriate city departments for an investigation into the applicant’s eligibility for a license. If a license is available and there are not more applications received at the same time than licenses available, the city may issue a license unless:
      (1)   The applicant has made a false statement on the application or submits false records or documentation;
      (2)   The applicant is under the age of 21 years;
      (3)   The applicant has been convicted of a disqualifying felony offense as defined by state law;
      (4)   The license is to be used for a business prohibited by state or local law, statute, rule, ordinance or regulation;
      (5)   The applicant has had a cannabis establishment license revoked by the city or a registration certificate revoked by the state in the 24 months preceding the application;
      (6)   An applicant is overdue in payment to the city of taxes, fees, fines or penalties assessed against or imposed upon the applicant in relation to any cannabis establishment;
      (7)   Subject to division (E) below, the applicant does not possess a valid and current registration certificate issued by the State Department of Health;
      (8)   The applicant will not be operating the business for which the license would be issued; or
      (9)   The location for the cannabis establishment does not comply with zoning requirements as set by the city’s zoning regulations.
   (B)   The license must be posted in a conspicuous place at or near the entrance to the cannabis establishment so that it may be easily read at any time.
   (C)   For applications received by the city after July 1, 2022, the applications will be considered in the order in which they are received. If multiple applications that conform with ordinance requirements are received on the same business day for a particular license, the city will choose the successful applicant through a lottery.
   (D)   When a lottery is conducted, the applicants will be placed in a lottery queue based on the order in which they were selected. If the applicant selected first in the lottery is unable to comply with the terms of this chapter or state law, the next applicant in the lottery queue will be considered for the cannabis establishment license. The lottery queue will be active for 24 months from the date the lottery was conducted, after which the lottery queue will expire.
   (E)   If an applicant otherwise meets the requirements to be issued a cannabis establishment license but has not been issued a registration certificate from the State Department of Health, the city may issue the applicant a provisional license. A provisional license expires 180 days from the date of issuance. If the applicant is not issued a registration certificate from the State Department of Health prior to the expiration of the 180-day term of the provisional license, the city will not issue the applicant a cannabis establishment license. To be considered again for a cannabis establishment license, an applicant whose provisional license expired must submit a new initial application that conforms with all the requirements in this chapter and state law. This new initial application will not be given priority over other active applications and will be considered in the order in which it was received in relation to any other active applications on file with the city. This new initial application will not be placed in any active lottery queue.
   (F)   If a conforming application is submitted but no licenses are available, the application will be on file and active for 24 months from the date it was submitted. If an applicable cannabis establishment license becomes available while an application is active under this section, the applicant may be considered for the cannabis establishment license without having to submit a new initial application. After 24 months have elapsed since the application was submitted, the application will expire. Upon the expiration of an application, an applicant must submit a new initial application that conforms with all the requirements in this chapter and state law to be considered for a cannabis establishment license.
   (G)   Upon issuance of a license, the applicant shall pay a license fee as set by resolution. The license will not be in effect until the applicant pays the license fee in full. The license fee will not be prorated.
(Prior Code, § 10-504) (Ord. 1346, passed 6-21-2021; Ord. 1355, passed 10-4-2021; Ord. 1371, passed 7-5-2022)
§ 118.06 NUMBER OF LICENSES.
   (A)   The number of cannabis cultivation facility licenses may not exceed two for the first 20,000 of population or fraction thereof and may not exceed one for each additional 5,000 of population or fraction thereof.
   (B)   The number of cannabis testing facility licenses may not exceed two for the first 20,000 of population or fraction thereof and may not exceed one for each additional 5,000 of population or fraction thereof.
   (C)   The number of cannabis manufacturing facility licenses may not exceed two for the first 20,000 of population or fraction thereof and may not exceed one for each additional 5,000 of population or fraction thereof.
   (D)   The number of cannabis dispensary licenses may not exceed one for the first 20,000 of population or fraction thereof and may not exceed one for each additional 5,000 of population or fraction thereof.
   (E)   For the purpose of this section, POPULATION is equal to 90% of the population estimates published by the United States Census Bureau for each even-numbered year, except for the decennial year. For a decennial year, population is equal to the amount determined by the decennial federal census.
(Prior Code, § 10-505) (Ord. 1346, passed 6-21-2021)
§ 118.07 ACTIVITIES AUTHORIZED WITH LICENSE.
   (A)   A license for a cannabis cultivation facility authorizes the license holder to conduct the following activities:
      (1)   Possess, plant, propagate, cultivate, grow, harvest, produce, process, manufacture, compound, convert, prepare, pack, repack or store cannabis;
      (2)   Deliver, transfer or transport cannabis to a testing facility and compensate a testing facility for services provided;
      (3)   Accept cannabis offered by a cardholder or nonresident cardholder if nothing of value is exchanged in return;
      (4)   Purchase or otherwise acquire cannabis from a cultivation facility;
      (5)   Purchase cannabis seeds from a cardholder, nonresident cardholder or the equivalent of a medical cannabis establishment that is registered in another jurisdiction; or
      (6)   Deliver, sell, supply, transfer or transport cannabis, cannabis paraphernalia or related supplies or educational materials to a cultivation facility and dispensary.
   (B)   A license for a cannabis testing facility authorizes the license holder to conduct the following activities:
      (1)   Acquire, possess, transport and store cannabis or cannabis products obtained from a cardholder, nonresident cardholder or medical cannabis establishment;
      (2)   Return the cannabis or cannabis products to a cardholder, nonresident cardholder or medical cannabis establishment from whom it was obtained;
      (3)   Test cannabis, including for potency, pesticides, mold or contaminants; or
      (4)   Receive compensation for services under this chapter.
   (C)   A license for a cannabis manufacturing facility authorizes the license holder to conduct the following activities:
      (1)   Purchase or otherwise acquire cannabis from cultivation facility, and cannabis products or cannabis from a cannabis product manufacturing facility;
      (2)   Possess, produce, process, manufacture, compound, convert, prepare, pack, repack and store cannabis or cannabis products;
      (3)   Deliver, transfer or transport cannabis, cannabis products, cannabis paraphernalia or related supplies or educational materials to a dispensary or cannabis product manufacturing facility;
      (4)   Deliver, transfer or transport cannabis to testing facility and compensate testing facility for services provided; or
      (5)   Deliver, sell, supply, transfer or transport cannabis, cannabis products, cannabis paraphernalia or related supplies or educational materials to a cannabis product manufacturing facility or dispensary.
   (D)   A license for a cannabis dispensary authorizes the license holder to conduct the following activities:
      (1)   Possess, transport or store cannabis or cannabis products;
      (2)   Deliver, transfer or transport cannabis to a testing facility and compensate a testing facility for services provided;
      (3)   Accept cannabis offered by a cardholder or nonresident cardholder if nothing of value is exchanged in return;
      (4)   Purchase or otherwise acquire cannabis from a cultivation facility or dispensary, and cannabis products from cannabis product manufacturing facility or dispensary; and
      (5)   Deliver, sell, supply, transfer or transport cannabis, cannabis products, cannabis paraphernalia or related supplies or educational materials to a cardholder, nonresident cardholder or dispensary.
(Prior Code, § 10-506) (Ord. 1346, passed 6-21-2021)
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