OAR 845-025-1115: Denial of Application

(1) The Commission must deny an initial or renewal application if: (a) An applicant is under the age of 21. (b) The applicant’s land use compatibility statement shows that the proposed land use is prohibited in the applicable zone, if a land use compatibility statement is required. (c) The proposed licensed premises is located: (A) Outside of the State of Oregon. (B) On federal property. (C) On reservation or tribal trust land of a federally recognized Indian tribe unless that tribe has entered into an agreement with the State of Oregon which allows licensing of recreational marijuana businesses. (d) The proposed licensed premises of a processor who has applied for an endorsement to process extracts is located in an area that is zoned exclusively for residential use. (e) The proposed licensed premises of a retail applicant is located: (A) Except as provided in ORS 475C.101, within 1,000 feet of: (i) A public elementary or secondary school for which attendance is compulsory under ORS 339.020; or (ii) A private or parochial elementary or secondary school, teaching children as described in ORS 339.030(1)(a). (B) In an area that is zoned exclusively for residential use. (f) The proposed licensed premises of a wholesaler applicant is in an area zoned exclusively for residential use. (g) A city or county has prohibited the license type for which the applicant is applying, in accordance with ORS 475C.950. (2) The Commission may deny an initial or renewal application, unless the applicant shows good cause to overcome the denial criteria, if the Commission has reasonable cause to believe that: (a) The applicant: (A) Is in the habit of using alcoholic beverages, habit-forming drugs, marijuana, or controlled substances to excess. (B) Has made false statements to the Commission. (C) Is incompetent or physically unable to carry on the management of the establishment proposed to be licensed. (D) Is not of good repute and moral character. (E) Does not have a good record of compliance with ORS 475C.005 to 475C.525 or these rules, prior to or after licensure, including but not limited to: (i) The giving away of marijuana items as a prize, premium or consideration for a lottery, contest, game of chance or skill, or competition of any kind, in violation of ORS 475C.333; (ii) Providing marijuana items to an individual without checking that the individual is 21 years of age or older; (iii) Unlicensed transfer of marijuana items for financial consideration; or (iv) Violations of local ordinances adopted under ORS 475C.449, pending or adjudicated by the local government that adopted the ordinance. (F) Does not have a good record of compliance with ORS chapter 471 or any rules adopted thereunder. (G) Is not possessed of or has not demonstrated financial responsibility sufficient to adequately meet the requirements of the business proposed to be licensed. (H) Is unable to understand the laws of this state related to marijuana or these rules. This may be demonstrated by violations documented by the Oregon Health Authority. (I) For license renewal, has not submitted all fees, forms, documents, and information required to act on the renewal application within the time period prescribed by the Commission. (J) Has, or previously had, an unapproved ownership interest in a license issued by the Commission other than as provided in OAR 845-025-1165. (K) Has diverted marijuana to the interstate market or an illicit market or has diverted resources to a criminal enterprise. (L) Has introduced into the marijuana industry regulated under ORS 475C.005 to 475C.525 cannabinoids or marijuana not produced or processed by a licensee and not tracked in the system developed and maintained under ORS 475C.177. (M) Has operated as a hemp grower registered or licensed under ORS 571.281 and grown cannabis that was found to be presumptively marijuana under OAR 845-026-4100 or OAR 845-026-4110. (b) Any individual listed on the application has been convicted of violating a general or local law of this state or another state, or of violating a federal law, if the conviction is substantially related to the fitness and ability of the applicant to lawfully carry out activities under the license, except as specified in ORS 475C.037(3). The Commission may consider factors set forth in section (8) of this rule to determine if this refusal basis is supported or overcome. (c) Any applicant is not the legitimate owner of the business proposed to be licensed, or other persons have an ownership interest in the business have not been disclosed to the Commission. (d) Any portion of the premises of the business proposed to be licensed overlaps or would overlap with a portion of: (A) An area licensed under ORS chapter 471 or a portion of any area operated or controlled by a retail liquor agent appointed by the Commission; (B) The premises of any other producer, retailer, processor, wholesaler, or laboratory license, unless the licenses are of different types and all of the licenses at the location are held or sought by identical applicants; or (C) An area licensed under ORS 475A.290 as a psilocybin manufacturer or an area licensed under 475A.305 as a psilocybin service center. (e) The location proposed to be licensed is prohibited under OAR 845-025-1230. (f) The proposed licensed premises of a producer is located on the same tax lot as a site registered with Oregon Department of Agriculture for the production of industrial hemp, unless the applicant submits and the Commission approves a control plan describing how the registered site shall be separated from the premises proposed to be licensed and how the applicant shall prevent transfer of industrial hemp to the licensed premises. (g) The applicant does not have access to the proposed or licensed premises. The Commission may consider it good cause for a renewal application when the licensee loses access to the licensed premises 90 days prior to expiration. (h) The proposed licensed premises of the producer applicant is on the same tax lot as another producer licensee and the presence of multiple producers on the same tax lot creates a risk of non-compliance with any of these rules. (i) The applicant is a business entity that is required to be registered with the Oregon Secretary of State but has failed to register. (3) The Commission may refuse to issue a license to any license applicant or refuse to renew the license of any licensee or laboratory licensee when conditions exist in relation to any person having a financial interest in the business or in the place of business which would constitute grounds for refusing to issue a license or for revocation or suspension of a license if such person were the license applicant, licensee, or laboratory licensee. (4)(a) The Commission may deny any initial or renewal application and may revoke any license if medical marijuana items are produced, processed, stored, sold, or transported, to or from the same location or address of the licensed business or business proposed to be licensed. (b) The Commission will not deny an initial application under this section if: (A) The applicant surrenders any registration issued by the Authority for the address or location of the business proposed to be licensed; (B) If applicable, the applicant notifies all other growers registered by the Authority at the location or address proposed to be licensed, in a form and manner prescribed by the Commission, that the grower is no longer permitted to produce medical marijuana at the location or address proposed to be licensed, and must surrender their registration at that location or address; and (C) All medical marijuana activity at the location or address proposed to be licensed ceases prior to being issued an OLCC license. (5) If the Commission denies an application because an applicant submitted false or misleading information to the Commission, the Commission may prohibit the applicant from re-applying for five years. (6) The Commission may revoke or refuse to renew a license for any of the reasons that it may deny a license. (7) A notice of denial must be issued in accordance with ORS 183. (8) Factors that may support or overcome license denial pursuant to subsection (2)(b) of this rule. These factors may have occurred before or after the incident or incidents that are relevant to the specific criterion. The factors may be weighed in favor of the applicant, weighed against the applicant, or weighed neither for nor against the applicant. (a) Definitions. For purposes of this section: (A) “Administrative violation” means an administrative agency has taken a final action finding that an individual, or a legal entity that the individual is part of, violated a regulation of that administrative agency. (B) “Compliance risk factors” means factors that show the individual’s tendency to disobey laws, rules, and regulations; including but not limited to probation and parole violations, non-relevant convictions, and administrative violations. (C) “Relevant conviction” means a conviction, other than those listed in ORS 475C.037(3), that involved violence or the threat of violence; dishonesty or deception; drugs, alcohol, or other regulated substances; or a conviction as a felon in possession of a weapon. (D) “Successful treatment” means: (i) The Commission receives written confirmation from the individual’s licensed treatment provider that the individual completed treatment that is related to a relevant conviction and the Commission has determined that the individual has not had another conviction for a similar incident since the completion of the treatment; or (ii) The individual is still in a treatment program that is related to a relevant conviction; however, the Commission receives written confirmation from the individual’s licensed treatment provider that the individual has demonstrated sufficient success towards stopping the behavior that led to the conviction and the Commission has determined that the individual has not had another conviction for a similar incident since the date the provider determined that the individual demonstrated sufficient success towards stopping the behavior that led to the conviction. (b) Upon the Commission’s determination that a basis to refuse the application has been established under this criterion, the Commission may consider the following factors and may consider other factors, depending on the facts of the case: (A) Passage of time, whichever date is later: (i) Since the date of the most recent incident that led to a relevant conviction, but not counting time spent incarcerated or other factors the Commission determines affect the passage of time; or (ii) Since the date of the most recent compliance risk factor, but not counting time spent incarcerated or other factors the Commission determines affect the passage of time. (B) Compliance risk factors. (C) Successful treatment. (D) The severity of the individual’s relevant conviction record as shown by the number of convictions, whether a conviction was a felony or non-felony, and whether a conviction involved violence or the manufacture or delivery of controlled substances. (E) The individual’s record of compliance with the Commission.