Chapter 3796:4-1 Generally

3796:4-1-01 Number of testing laboratory provisional licenses.

(A) The director of the department of commerce or the director's designee may issue a provisional license to conduct laboratory testing of medical marijuana in accordance with the criteria listed in section 3796.09 of the Revised Code to an institution of higher learning that meets all of the following conditions:

(1) The institution is public, and is located in the state of Ohio; and

(2) The institution has the facilities and resources necessary to conduct testing in accordance with the standards and procedures established in rules adopted by the department under section 3796.03 of the Revised Code.

(B) Beginning on the date that occurs one year after the date on which the department begins accepting applications for licensure under section 3796.09 of the Revised Code, the director or the director's designee may issue a provisional license or certificate of operation to conduct laboratory testing of medical marijuana to a laboratory that is not part of an institution of higher learning as specified in paragraph (A) of this rule, in accordance with the criteria listed in section 3796.09 of the Revised Code and this division.

(C) In the event additional provisional licenses are deemed necessary, as determined by the director or the director's designee based on the volume of medical marijuana being produced and consumed by patients in the state of Ohio, the department will follow the license application procedures outlined in rule 3796:4-1-02 of the Administrative Code.

Effective: 9/8/2017
Five Year Review (FYR) Dates: 09/08/2022
Promulgated Under: 119.03
Statutory Authority: R.C. 3796.03, R.C. 3796.09
Rule Amplifies: R.C. 3796.03, R.C. 3796.09

3796:4-1-02 Testing laboratory provisional license application.

(A) The department shall provide advance notice to the public indicating the commencement date and time period for accepting applications. The director shall have the right to amend the notice prior to the deadline for submitting an application. The director shall publish such amended notice in the same manner as the original notice. The director shall also have the right to cancel a notice of open application prior to the award of a testing laboratory provisional license.

(B) The provisional license application shall be submitted in accordance with Chapter 3796. of the Revised Code and this division. The application will include instructions for completion and submission. An applicant for a testing laboratory provisional license shall submit, in accordance with the application instructions, the following:

(1) A non-refundable application fee as set forth in rule 3796:5-1-01 of the Administrative Code.

(2) A business plan, which, at a minimum, shall include:

(a) The legal name of the applicant;

(b) The type of business organization of the applicant, such as individual, corporation, partnership, limited liability company, association, cooperative, joint venture, or any other business organization;

(c) Confirmation that the applicant is registered with the secretary of state as the type of business submitted pursuant to paragraph (B)(2)(b) of this rule, a certificate of good standing issued by the secretary of state, and a copy of the applicable business documents governing the operations and administration of the business;

(d) The proposed physical address of the applicant's facility;

(e) An organizational chart of the company, including name, address, and date of birth of each principal officer and board member of the testing laboratory, provided that all those individuals shall be at least twenty-one years of age;

(f) Experience with the analytical testing of medical marijuana or other agricultural, horticultural, or pharmaceutical products;

(g) All persons subject to the criminal records checks shall submit both an Ohio bureau of criminal identification and investigation criminal records check and a federal bureau of criminal investigation criminal records check pursuant to division (B) of section 3796.12 of the Revised Code;

(h) Any instance in which a business that any person associated with the applicant had managed or served on the board of the business and was convicted, fined, censured, or had a registration or license suspended or revoked in any administrative or judicial proceeding;

(i) Evidence that the applicant owns the property on which the proposed testing laboratory will be located, has executed a lease for the property that does not contain any use restrictions that would otherwise prevent the testing laboratory from operating pursuant to Chapter 3796. of the Revised Code and the rules promulgated in accordance with Chapter 3796. of the Revised Code, or has secured the ability to purchase or lease the property that does not contain any use restrictions that would otherwise prevent the testing laboratory from operating pursuant to Chapter 3796. of the Revised Code and the rules promulgated in accordance with Chapter 3796. of the Revised Code;

(j) A location area map of the area surrounding the proposed testing laboratory that establishes the facility is at least five hundred feet from the boundaries of a parcel of real estate having situated on it a prohibited facility, as measured under rule 3796:5-5-01 of the Administrative Code;

(k) For any instance in which an applicant or any person associated with the applicant is currently or was previously licensed or authorized in another state or jurisdiction to cultivate, produce, test, dispense, or otherwise deal in the distribution of medical marijuana in any form, the following:

(i) A copy of each such licensing or authorizing document verifying licensure in that state or jurisdiction;

(ii) A statement granting permission to contact the regulatory agency that granted the license, accompanied by the contact information, to confirm the information contained in the application; and

(iii) If the license, authorization, or application was ever warned, fined, denied, suspended, revoked, or otherwise sanctioned, a copy of documentation so indicating, or a statement that the applicant was so licensed and was never sanctioned; and

(l) Documentation that the applicant is currently in compliance, or will be in compliance prior to the issuance of a certificate of operation, with all building, fire, safety, and zoning statutes, local ordinances, and rules and regulations adopted by the locality in which the applicant's property is located, which are in effect at the time of the application, including but not limited to building department approval demonstrating compliance with rules adopted by the board of building standards pursuant to Chapters 3781. and 3791. of the Revised Code and any applicable zoning considerations.

(3) An operations plan that establishes policies and procedures in accordance with the requirements of ISO/IEC 17025 "General Requirements for the Competence of Testing and Calibration Laboratories," that the applicant will implement for the secure and proper analytical testing of medical marijuana, which, at a minimum, shall include:

(a) Laboratory analysis techniques, including specific instrumentation and protocols necessary to perform the tests required by this division;

(b) The implementation of standards and methods for conducting testing laboratory analysis of medical marijuana and medical marijuana products that will allow the applicant to obtain accreditation to the ISO/IEC 17025 "General Requirements for the Competence of Testing and Calibration Laboratories" standard within two years of issuance of a provisional license;

(c) A list of proposed analytical services to be offered;

(d) Facility specifications, designating the areas in the facility where analytical testing will occur, and evidencing that the applicant will comply with the requirements of Chapter 3796. of the Revised Code and will operate in accordance with the rules promulgated pursuant to Chapter 3796. of the Revised Code;

(e) Facility staffing and employment matters, which, at a minimum, shall include:

(i) Employee training standards for the safe operation and maintenance of any and all instrumentation that will be used in the analytical testing of medical marijuana conducted on an annual basis;

(ii) Employee training standards for the safe use, handling, storage and disposal of any and all chemicals that will be used in the analytical testing of medical marijuana, in accordance with OSHA protocols, conducted on an annual basis; and

(iii) Employee compliance with Chapter 3796. of the Revised Code and the rules promulgated in accordance with Chapter 3796. of the Revised Code;

(f) Compliance with the inventory tracking system implemented by the department; and

(g) Policies and procedures for the disposal of medical marijuana waste and other wastes that ensure medical marijuana waste is rendered unusable.

(4) A security plan that establishes policies and procedures to prevent theft, loss, or diversion from a testing laboratory and protect facility personnel, which, at a minimum, shall include:

(a) Record keeping policies and procedures that will ensure the facility complies with rule 3796:4-2-06 of the Administrative Code;

(b) A security plan in accordance with rule 3796:4-2-07 of the Administrative Code;

(c) Transportation policies in accordance with rule 3796:4-2-10 of the Administrative Code; and

(d) A plot plan of the laboratory facility drawn to a reasonable scale that designates the different areas of operation, with mandatory access restrictions.

(i) If the building is in existence at the time of the application, the applicant shall submit plans and specifications drawn to scale for the interior of the building.

(ii) If the building is not in existence at the time of application, the applicant shall submit a plot plan and a detailed drawing to scale of the interior and the architect's drawing of the building to be constructed.

(5) A financial plan, which, at a minimum, shall include:

(a) The identity and ownership interest of every person, association, partnership, other entity or corporation having a financial interest, direct or indirect, in the testing laboratory with respect to which licensure is sought;

(b) A cost breakdown of the applicant's anticipated costs in building the facility and implementing the policies and procedures submitted as part of the application and the source of funding for the associated costs;

(c) Documentation acceptable to the department that the individual or entity filing the application has at least two hundred fifty thousand dollars in liquid assets for a testing laboratory provisional license, which are unencumbered and can be converted within thirty days after a request to liquidate such assets;

(i) Documentation acceptable to the department includes a signed statement from an Ohio licensed certified public accountant attesting to proof of the required amount of liquid assets under the control of an owner or the entity applying, if such a statement is available at the time of application.

(ii) The documentation must be dated within thirty calendar days before the date the application was submitted;

(d) Information verifying that the applicant will be able to conform to the financial responsibility requirements under rule 3796:4-1-05 of the Administrative Code; and

(e) A record of tax payments in the form of tax summary pages for individuals and businesses at the state and federal level in this state and in all jurisdictions in which an applicant has operated as a business and for every person with a financial interest of one per cent or greater in the applicant for the five years before the filing of the application, unless the department determines that documentation should be submitted for all individuals and entities.

(6) Any other information requested in the application instructions that the department deems necessary to evaluate and determine the applicant's suitability for a testing laboratory license.

Effective: 9/8/2017
Five Year Review (FYR) Dates: 09/08/2022
Promulgated Under: 119.03
Statutory Authority: R.C. 3796.03
Rule Amplifies: R.C. 3796.03 , R.C. 3796.09

3796:4-1-03 Testing laboratory application review.

(A) The department, an independent contractor selected by the department, or a combination of the two shall review the submitted applications as described in this chapter and the application instructions. In order to receive consideration under paragraph (B) of this rule, an applicant shall:

(1) Demonstrate sufficient liquid capital pursuant to rule 3796:4-1-02 of the Administrative Code and an ability to meet the financial responsibility requirements under rule 3796:4-1-05 of the Administrative Code;

(2) Certify in writing at the time of application that an owner or prospective owner, officer or prospective officer, board member or prospective board member, administrator or prospective administrator, employee or prospective employee, agent or other person has not been:

(a) Convicted of a disqualifying offense, as defined in rule 3796:1-1-01 of the Administrative Code; or

(b) Issued a certificate to recommend or applied for certification under section 4731.30 of the Revised Code;

(3) Verify that the proposed facility is not located within five hundred feet from a prohibited facility, which shall be measured in accordance with rule 3796:5-5-01 of the Administrative Code;

(4) Certify that the local jurisdiction where the facility is proposed has not passed a moratorium or taken other action that would prohibit the applicant from operating as a medical marijuana testing laboratory;

(5) Certify that an owner or prospective owner, officer or prospective officer, board member or prospective board member, administrator or prospective administrator, employee or prospective employee, agent, or other person who may significantly influence or control the activities of the testing laboratory does not have a direct or indirect financial interest in, or serve as an owner, officer, board member, administrator, employee, agent, or other person who may significantly influence or control the activities of any of the following:

(a) A cultivator, processor, or dispensary licensed under Chapter 3796. of the Revised Code;

(b) An applicant for a cultivator, processor, or dispensary license;

(6) Provide documentation sufficient to establish that the applicant is in compliance with the applicable tax laws of this state and any jurisdiction where the applicant operates and conducts business;

(7) Submit an application with the applicable fee under rule 3796:5-1-01 of the Administrative Code during the established application submission period established under paragraph (A) of rule 3796:4-1-02 of the Administrative Code. The application shall be submitted in accordance with the application instructions and forms issued by the department. The department may remove an application from consideration for any of the following:

(a) Failure or refusal to submit information required under rule 3796:4-1-02 of the Administrative Code or requested by the department during the application submission or review process;

(b) Inclusion of information in the application that misleads the department, misrepresents a material fact, or fails to disclose a material fact to the department;

(c) Submission of an application that is in violation of the application instructions issued by the department, or includes forms issued by the department that have been altered.

(B) The applicants shall be evaluated using an impartial and numerical process taking into account the criteria identified in rule 3796:4-1-02 of the Administrative Code, as developed by the department, an independent contractor selected by the department, or a combination of the two. The applicants will be evaluated based on the following criteria, at a minimum:

(1) A business plan, which, at a minimum, shall include:

(a) A proposed business model demonstrating a likelihood of success, a sufficient business ability and experience on the part of the applicant;

(b) An organizational chart of the company, including name, address, and date of birth of each principal officer and board member of the testing laboratory, provided that all those individuals shall be at least twenty-one years of age;

(c) Experience with the analytical testing of medical marijuana or other agricultural, horticultural, or pharmaceutical products, which includes information on licenses held by any person affiliated with the applicants, regardless if said license is active or expired. If expired, applicant shall provide the grounds behind the expiration. The information provided on business licenses shall include the type of license, the licensing agency, the date the license was obtained, and a summary of any negative actions taken against each license.

(d) Evidence that the applicant owns the property on which the proposed testing laboratory will be located, has executed a lease for the property that does not contain any use restrictions that would otherwise prevent the testing laboratory from operating pursuant to Chapter 3796. of the Revised Code and the rules promulgated in accordance with Chapter 3796. of the Revised Code, or has secured the ability to purchase or lease the property that does not contain any use restrictions that would otherwise prevent the testing laboratory from operating pursuant to Chapter 3796. of the Revised Code and the rules promulgated in accordance with Chapter 3796. of the Revised Code;

(e) Documentation that the applicant is currently in compliance, or will be in compliance prior to the issuance of a certificate of operation, with any local ordinances, rules or regulations adopted by the locality in which the applicant's property is located, which are in effect at the time of the application. Such documentation may include, but is not limited to, local building department approval demonstrating compliance with rules adopted by the board of building standards pursuant to Chapters 3781. and 3791. of the Revised Code to construct the proposed facility, local approval to operate as a medical marijuana cultivation facility, and evidence that the applicant's proposed location is in compliance with local ordinances, rules or regulations adopted by the locality in which the applicant's property is located, which are in effect at the time of the application.

(2) An operations plan, which shall include but not be limited to:

(a) Laboratory analysis techniques, including specific instrumentation and protocols necessary to perform the tests required by this division;

(b) The implementation of standards and methods for conducting testing laboratory analysis of medical marijuana and medical marijuana products that will allow the applicant to obtain accreditation to the ISO/IEC 17025 "General Requirements for the Competence of Testing and Calibration Laboratories" standard within two years of issuance of a provisional license;

(c) A list of proposed analytical services to be offered;

(d) Facility specifications, designating the areas in the facility where analytical testing will occur, and evidencing that the applicant will comply with the requirements of Chapter 3796. of the Revised Code and will operate in accordance with the rules promulgated pursuant to Chapter 3796. of the Revised Code;

(e) Facility staffing and employment matters, which shall include, but not be limited to;

(i) Employee training standards for the safe operation and maintenance of any and all instrumentation that will be used in the testing of medical marijuana;

(ii) Employee training standards for the safe use, handling, storage, and disposal of any and all chemicals that will be used in the testing of medical marijuana, in accordance with OSHA protocols; and

(iii) Employee compliance with Chapter 3796. of the Revised Code and the rules promulgated in accordance with Chapter 3796. of the Revised Code;

(f) Compliance with the inventory tracking system implemented by the department; and

(g) Policies and procedures for the destruction and disposal of medical marijuana waste and other wastes that ensure medical marijuana waste is rendered unusable.

(3) A security plan, which shall include but not be limited to:

(a) Policies and procedures to ensure a secure, safe facility to prevent theft, loss, or diversion and protect facility personnel;

(b) Physical equipment used to monitor the facility and meet the security requirements under Chapter 3796. of the Revised Code and the rules promulgated in accordance with Chapter 3796. of the Revised Code;

(c) Emergency notification procedures with the department, local law enforcement, and emergency response professionals;

(d) A plot plan of the laboratory facility drawn to a reasonable scale that designates the different areas of operation, with the mandatory access restrictions; and

(e) Transportation policies and procedures, which includes the transportation of medical marijuana from a cultivator or processor licensed by the department to the proposed testing laboratory in the state of Ohio, in accordance with rule 3796:4-2-10 of the Administrative Code.

(4) A financial plan, which, at a minimum, shall include:

(a) The identity and ownership interest of every person, association, partnership, other entity, or corporation having a financial interest, direct or indirect, in the testing laboratory with respect to which licensure is sought;

(b) A cost breakdown of the applicant's anticipated costs in building the facility and implementing the policies and procedures submitted as part of the application and the source of funding for the associated costs;

(c) Documentation acceptable to the department that the individual or entity filing the application has secured at least two hundred fifty thousand dollars in liquid assets for a testing laboratory provisional license are unencumbered and can be converted within thirty days after a request to liquidate such assets;

(i) Documentation acceptable to the department includes a signed statement from an Ohio licensed certified public accountant attesting to proof of the required amount of liquid assets under the control of an owner or the entity applying, if such a statement is available at the time of application.

(ii) The documentation must be dated within thirty calendar days before the date the application was submitted.

(d) Information verifying that the applicant will be able to conform to the financial responsibility requirements under rule 3796:4-1-05 of the Administrative Code; and

(e) A record of tax payments in the form of tax summary pages for individuals and businesses at the state and federal level in this state and in all jurisdictions in which an applicant has operated as a business and for every person with a financial interest of one percent or greater in the applicant for the five years before the filing of the application, unless the department determines that documentation should be submitted for all individuals and entities.

(5) Any other information that the department deems necessary to evaluate and determine the applicant's suitability to operate as a medical marijuana testing laboratory.

(C) In addition to the criteria established in paragraph (B) of this rule, the department may also consider the following when awarding a provisional license:

(1) Principal place of business;

(a) The applicant must provide documentation establishing that its principal place of business is headquartered in Ohio. The applicant may also provide the names, addresses, and verification of any persons associated with the applicant that have established residency in Ohio.

(b) The applicant may also provide a plan for generating Ohio-based jobs and economic development.

(2) Employment practices, in which the applicant must demonstrate a plan of action to inform, hire, and educate minorities, women, veterans, disabled persons, and Ohio residents;

(3) Verification of economically disadvantaged groups; and

(a) The applicant must demonstrate the following:

(i) It is owned and controlled by a United States citizen who is a resident of this state and is a member of one of the economically disadvantaged groups set forth in division (C) of section 3796.09 of the Revised Code. As used in this rule, "owned and controlled" means that at least fifty-one per cent of the business, including corporate stock if a corporation, is owned by persons who belong to one or more of the groups set forth in this rule, and that those owners have control over the management and day-to-day operations of the business and an interest in the capital, assets, and profits and losses of the business proportionate to their percentage of ownership; or

(ii) It is owned and controlled as a woman-owned business by a United States citizen who is a resident of this state. For purpose of the paragraph, "owned and controlled" has the same ownership and control requirements as listed in paragraph (C)(3)(a)(i) of this rule.

(4) Research plan, in which the applicant must provide the department with a detailed proposal to conduct or facilitate a scientific study or studies related to the medicinal use of marijuana. Such a proposal shall address any applicable regulatory restrictions and compliance therewith.

(D) The department may request additional information as part of the application review process from an applicant that otherwise meets all of the requirements under paragraph (A) of this rule. The applicant shall have thirty calendar days from the date the applicant receives the department's request to provide the information. If the applicant fails to provide the requested information within thirty calendar days, it will result in an abandoned application. An abandoned application shall not receive further consideration.

(E) An applicant forfeits all fees associated with an abandoned application. The department shall not be required to act on an abandoned application and the application may be destroyed by the department. An abandoned application will not prevent an applicant from applying for a provisional license in the future if the department issues additional provisional licenses pursuant to rule 3796:4-1-01 of the Administrative Code.

Effective: 9/8/2017
Five Year Review (FYR) Dates: 09/08/2022
Promulgated Under: 119.03
Statutory Authority: R.C. 3796.03
Rule Amplifies: R.C. 3796.03

3796:4-1-04 Testing laboratory provisional license award.

(A) A provisional license shall be issued to the qualified applicant receiving at least the minimum required score in each category and the highest total score overall as compared to the other applicants.

(B) If no qualified applicants are found during the process described in rule 3796:4-1-03 of the Administrative Code, a provisional licensee fails to fulfill the conditions in the application, a certificate of operation is revoked, or no license is issued or active for any other reason, the department may, at the discretion of the director, announce another period to submit an application in accordance with rule 3796:4-1-02 of the Administrative Code.

(C) No person shall hold or be granted more than one testing laboratory provisional license or testing laboratory certificate of operation at any time. No person shall hold a financial interest in or be an owner, partner, officer, director, shareholder, member, or other person who may significantly influence or control the activities of more than one testing laboratory. No corporation, partnership, limited liability partnership, limited liability company, or other entity or subsidiary thereof shall hold a financial interest in or be an owner, officer, partner, shareholder, member, or other person who may significantly influence or control the activities of more than one testing laboratory.

Effective: 9/8/2017
Five Year Review (FYR) Dates: 09/08/2022
Promulgated Under: 119.03
Statutory Authority: R.C. 3796.03, R.C. 3796.09
Rule Amplifies: R.C. 3796.03, R.C. 3796.09

3796:4-1-05 Testing laboratory financial responsibility.

(A) A provisional licensee shall provide evidence of financial responsibility before a certificate of operation can be issued, which may be payable to the department for any of the following reasons:

(1) A testing laboratory fails to adhere to the security plan approved by the department or otherwise operates the facility in a manner that allows for or results in theft, loss, or diversion of medical marijuana;

(2) A testing laboratory engages in activities prohibited under rule 3796:4-2-08 of the Administrative Code; or

(3) A testing laboratory has its certification of operation fined, suspended, or revoked, resulting from activities prohibited under rule 3796:5-6-02 of the Administrative Code.

(B) Evidence of financial responsibility shall be provided by the following:

(1) Providing and maintaining at its own expense any insurance coverage and terms of insurance required and approved by the department, including, but not limited to, products liability and general liability, prior to the issuance of a certificate of operation, if such products are in existence at the time of issuance or the time of renewal for the certificate of operation; and

(2) Establishing and maintaining an escrow account in a chartered financial institution in Ohio in the amount of seventy-five thousand dollars, with escrow terms, approved by the department, that it shall be payable to the department in the event of circumstances outlined in paragraph (A) of this rule. A financial institution may not return money in an escrow or surety account to the testing laboratory that established the account or a representative of the testing laboratory unless the testing laboratory or representative presents a statement issued by the department indicating that the account may be released; or

(3) Providing a surety bond naming the testing laboratory as principal of the bond, upon terms approved by the department, in the amount of seventy-five thousand dollars, payable to the department in the event of circumstances outlined in paragraph (A) of this rule. Bond terms include the following:

(a) The business name and registration number on the bond must correspond exactly with the business name and registration number in the department's records.

(b) A copy of the bond must be received by the department before a certificate of operation is issued.

(c) The bond shall not be canceled by a surety on less than thirty days' notice in writing to the department. If a bond is canceled and the testing laboratory fails to file a new bond with the department in the required amount on or before the effective date of cancellation, the testing laboratory's license shall be revoked. The total and aggregate liability of the surety on the bond is limited to the amount specified on the bond.

(4) The department shall permit a testing laboratory to reduce the escrow or surety bond by twenty-five thousand dollars upon the successful achievement of each of the following milestones, resulting in a potential elimination of the escrow account or surety bond:

(a) A determination by the department that the testing laboratory remained fully operational without substantial interruption and demonstrates an ability to comply with the requirements of Chapter 3796. of the Revised Code and the rules promulgated in accordance with Chapter 3796, as determined by the department, for a period of one year;

(b) A determination by the department that the testing laboratory remained fully operational without substantial interruption and demonstrates an ability to comply with the requirements of Chapter 3796. of the Revised Code and the rules promulgated in accordance with Chapter 3796, as determined by the department, for two consecutive years; and

(c) A determination by the department that the testing laboratory remained fully operational without substantial interruption and demonstrates an ability to comply with the requirements of Chapter 3796. of the Revised Code and the rules promulgated in accordance with Chapter 3796 of the Revised Code, as determined by the department, for three consecutive years.

(5) A testing laboratory will not be held in default should the failure to comply be the direct result of an event or effect that cannot be reasonably anticipated or controlled, such as an act of God or nature and not the result of a lack of good faith effort.

(C) The required insurance policy and surety bond shall be written by an insurance company formed, licensed or eligible, and authorized or approved to write such insurance in the state of Ohio under Title XXXIX of the Revised Code.

Effective: 9/8/2017
Five Year Review (FYR) Dates: 09/08/2022
Promulgated Under: 119.03
Statutory Authority: R.C. 3796.03, R.C. 3796.09
Rule Amplifies: R.C. 3796.03, R.C. 3796.09

3796:4-1-06 Testing laboratory certificate of operation.

(A) A provisional licensee is prohibited from operating as a licensed testing laboratory and performing any analytical testing activities until a certificate of operation is issued by the department. The information and plan submitted by a provisional licensee shall become mandatory conditions that must be met before a certificate of operation can be awarded.

(B) A provisional licensee shall have six months from the date they are notified of selection to obtain a certificate of operation. A certificate of operation shall be issued once all applicable inspections are passed and the provisional licensee demonstrates that it conforms to the specifications of the application, as well as the requirements imposed by law and rules. If a certificate of operation is issued, the provisional license becomes null and void.

(C) The department shall not award a certificate of operation to a provisional licensee if the provisional licensee has not met all of the specifications in the application and passed all applicable inspections under rule 3796:4-3-01 of the Administrative Code within six months of written or electronic notification of the applicant's selection. If the provisional licensee fails to remedy the deficiencies in accordance with rule 3796:4-3-01 of the Administrative Code or otherwise satisfy the six-month time period established under paragraph (B) of this rule, the director, at his or her discretion, may extend the time period for the testing laboratory to obtain a certificate of operation or take action pursuant to rule 3796:5-6-01 of the Administrative Code.

(D) The certificate of operation, along with a copy of the current certificate of occupancy for the facility and any other certificate, business license, or other authorization required to conduct testing activities, shall be posted in a conspicuous place within the facility and made available to the department and all fire code and building officials upon request.

Effective: 9/8/2017
Five Year Review (FYR) Dates: 09/08/2022
Promulgated Under: 119.03
Statutory Authority: R.C. 3796.03
Rule Amplifies: R.C. 3796.03 , R.C. 3796.09

3796:4-1-07 Testing laboratory transfer of ownership or location.

(A) A provisional license issued pursuant to this rule is nontransferable.

(B) A certificate of operation shall be issued for the specific testing laboratory and location identified on the application, and is valid only for the owner, premises, and name designated on the certificate of operation, and the location for which it is issued. A certificate of operation may only be transferred or assigned if the department determines that the proposed ownership or location change meets all the requirements of this division and Chapter 3796. of the Revised Code and the following requirements are met:

(1) Upon any request for a change in ownership, the testing laboratory shall:

(a) Notify the department in writing of the proposed ownership change;

(b) Facilitate the submission of both an Ohio bureau of criminal identification and investigation criminal records check and a federal bureau of investigation criminal records check pursuant to division (B) of section 3796.12 of the Revised Code;

(c) Demonstrate to the department that the person acquiring the interest meets the requirements under rules 3796:4-1-02 and 3796:4-1-03 of the Administrative Code and that the testing laboratory will remain in compliance with its application for a provisional license, Chapter 3796. of the Revised Code, and the rules promulgated in accordance with Chapter 3796. of the Revised Code, under the proposed ownership structure; and

(d) Submit a new application in accordance with rule 3796:4-1-02 of the Administrative Code if the transfer of ownership would result in a new controlling shareholder or shareholders outside of the current ownership structure approved by the department. For purposes of calculating a controlling interest, the department will consider all transfers of ownership that occur in a given calendar year and calculate such transfers in the aggregate.

(2) Upon a request for a change in location, a testing laboratory shall:

(a) Notify the department in writing of the proposed location change;

(b) Submit plans and specifications for the new facility in accordance with rule 3796:4-1-02 of the Administrative Code; and

(c) Demonstrate to the department that the new location meets the applicable requirements of rule 3796:4-1-02 of the Administrative Code and that the testing laboratory will remain in compliance with Chapter 3796. of the Revised Code and the rules promulgated in accordance with Chapter 3796. of the Revised Code at the new location.

(C) A testing laboratory requesting a change in ownership or location shall submit the applicable fee under rule 3796:5-1-01 of the Administrative Code. A proposed change in ownership or request for a change in location shall not be effective until approved in writing by the department.

(D) A testing laboratory receiving approval from the department for a change in location shall have ninety days from the date of approval, unless an extension is granted at the discretion of the department, to transfer samples and begin operations at the new location, subject to the following restrictions:

(1) The transition period shall not begin until the new location is ready to begin testing and has passed an inspection by the department under rule 3796:4-3-01 of the Administrative Code.

(2) No medical marijuana samples may be transferred to or tested at the new location prior to the beginning date of the approved transition period.

(3) Any medical marijuana samples at the original location past the ninety-day transition period shall be destroyed in accordance with rule 3796:4-2-06 of the Administrative Code.

(4) The testing laboratory shall notify the department in writing or by electronic transmission once the transfer of medical marijuana sample inventory is complete and testing has begun at the new location.

(E) Upon inspection and verification by the department that the new location is in compliance with Chapter 3796. of the Revised Code and the rules promulgated in accordance with Chapter 3796. of the Revised Code, the department shall issue a license modification reflecting the new location. The modified license shall have the same expiration date as the previously issued license.

Effective: 9/8/2017
Five Year Review (FYR) Dates: 09/08/2022
Promulgated Under: 119.03
Statutory Authority: R.C. 3796.03
Rule Amplifies: R.C. 3796.03

3796:4-1-08 Testing laboratory certificate of operation renewal.

(A) Every testing laboratory certificate of operation issued by the department under this chapter shall expire annually on the date it was issued. A renewal application for a testing laboratory, accompanied by the proper renewal fee established under rule 3796:5-1-01 of the Administrative Code, shall be filed with the department at least thirty days prior to the expiration date of the certificate of operation.

(B) The department shall grant a renewal application if the application is filed in a timely manner, the testing laboratory submits the corresponding renewal fee, the department confirms that nothing warrants the denial of the renewal under rule 3796:5-6-01 of the Administrative Code, and the testing laboratory passes a full inspection, unless a full inspection was passed within three months before the renewal date.

(C) If a renewal application is not filed prior to the expiration date of the certificate of operation, the certificate of operation shall be suspended for a maximum of thirty days, at which point it will be deemed expired if the testing laboratory has not successfully renewed the certificate of operation under paragraph (B) of this rule. Upon expiration of the certificate of operation, the testing laboratory shall not engage in any testing activities in furtherance of the business of the testing of medical marijuana. The department shall not renew the certificate of operation and the facility shall permanently cease its operations.

(D) If a testing laboratory fails to achieve accreditation to the ISO/IEC 17025 "General Requirements for the Competence of Testing and Calibration Laboratories" standard within two years of the issuance of a provisional license, the certificate of operation may not be renewed, at the discretion of the department. If a testing laboratory fails to maintain accreditation to the ISO/IEC 17025 "General Requirements for the Competence of Testing and Calibration Laboratories" standard, including suspension by the accrediting body or failure on the part of the laboratory to renew accreditation, the certificate of operation may not be renewed, at the discretion of the department.

Effective: 9/8/2017
Five Year Review (FYR) Dates: 09/08/2022
Promulgated Under: 119.03
Statutory Authority: R.C. 3796.03
Rule Amplifies: R.C. 3796.03 , R.C. 3796.09

3796:4-1-09 Winding down.

(A) If a testing laboratory decides to voluntarily surrender or not renew its certificate of operation and permanently discontinue business operations, the testing laboratory shall provide written notice to the department at least ninety days prior to the effective date of the closure. If the closure is the result of an eviction notice, the testing laboratory shall immediately notify the department of the eviction notice and the effective date of the notice. This notice shall be provided prior to the testing laboratory taking any steps to wind down and discontinue business operations.

(B) A testing laboratory that notifies the department of its intent to voluntarily surrender or not renew its certificate of operation under paragraph (A) of this rule shall submit, within sixty days of the effective date, a written plan of closure for approval by the department. This plan shall include, at a minimum:

(1) The destruction of medical marijuana samples on hand at the facility on the effective date of the closure that will render the medical marijuana unusable, including the date of such destruction and an attestation signed by a witness to the destruction;

(2) The sale or removal of equipment and products ancillary to the testing of medical marijuana;

(3) The retention of all records required to be maintained in accordance with the applicable records retention schedules;

(4) The removal or disposal of any solvents or other chemicals used in the testing of medical marijuana, which shall be carried out in accordance with all applicable local, state, and federal laws.

(5) The steps that will be taken to maintain compliance with Chapter 3796. of the Revised Code, the rules promulgated in accordance with Chapter 3796. of the Revised Code, and any other conditions required by the director until the approved closure date;

(6) The closure and intended use of the premises in which the testing laboratory was located.

(7) Documentation of withdrawal from ISO/IEC 17025 "General Requirements for the Competence of Testing and Calibration Laboratories" accreditation.

(C) The director shall approve or deny a testing laboratory's plan of closure within thirty days of receipt. The director may request additional information if approval or denial of the plan cannot be determined based on the information provided.

Effective: 9/8/2017
Five Year Review (FYR) Dates: 09/08/2022
Promulgated Under: 119.03
Statutory Authority: R.C. 3796.03
Rule Amplifies: R.C. 3796.03