South Dakota Medical Cannabis Laws Explained

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On November 3, 2020, South Dakota passed ballot Measure 26 to join the medical marijuana club. As of July 1, 2021, medical patients can purchase, possess, and consume cannabis to relieve their debilitating conditions.

The first medical dispensary in the state opened on July 27, 2022.

As the new cannabis industry in South Dakota begins to grow, there are plenty of regulations and rules to understand so certified establishments can remain compliant.

This post dives into six essential South Dakota cannabis laws.

You can read the complete South Dakota medical cannabis laws here and the Administrative rules for the program here.

South Dakota marijuana laws at a glance

  • South Dakota has not passed adult-use cannabis legalization but some local governments have decriminalized small quantities of cannabis.

  • The Department of Health is in charge of issuing registration certificates for medical marijuana establishments.

  • Medical cannabis dispensary applications require a nonrefundable $5,000 fee.

  • Dispensary staff members must be over the age of 21.

  • South Dakota cannabis is subject to a 4.5% sales or use tax.

  • Cannabis purchase limits in South Dakota are 3 ounces of cannabis flower every 14 days.

Medical marijuana dispensary licensing

Legal reference

34-20G-55. Application for medical cannabis establishment--Contents and conditions--Time for registration.

Not later than ninety days after receiving an application for a medical cannabis establishment, the department shall register the prospective medical cannabis establishment and issue a registration certificate and a random ten-digit alphanumeric identification number if all of the following conditions are satisfied:

(1) The prospective medical cannabis establishment has submitted all of the following:

(a) The application fee;

(b) An application, including:

(i) The legal name of the prospective medical cannabis establishment;

(ii) The physical address of the prospective medical cannabis establishment that is not within one thousand feet of a public or private school existing before the date of the medical cannabis establishment application;

(iii) The name and date of birth of each principal officer and board member of the proposed medical cannabis establishment; and

(iv) Any additional information requested by the department;

(c) Operating procedures consistent with rules for oversight of the proposed medical cannabis establishment, including procedures to ensure accurate record keeping and adequate security measures;

(d) If the city or county where the proposed medical cannabis establishment would be located has enacted zoning restrictions, a sworn statement certifying that the proposed medical cannabis establishment does not violate the restrictions;

(e) If the city or county where the proposed medical cannabis establishment requires a local registration, license, or permit, a copy of the registration, license, or permit;

(2) None of the principal officers or board members has served as a principal officer or board member for a medical cannabis establishment that has had its registration certificate revoked;

(3) None of the principal officers or board members is under twenty-one years of age; and

(4) At least one principal officer is a resident of this state.

To obtain a license for a medical cannabis establishment in South Dakota, the council must first approve the application. Official registration of the certificate takes a maximum of 90 days.

You can reference this medical cannabis establishment checklist to ensure every aspect of your application process is properly completed.

Along with a nonrefundable $5,000 fee, a medical cannabis establishment (dispensary) application must include the following:

  • The name of the dispensary

  • The dispensary’s address

  • The legal name and birthday of each affiliated principal officer and board member

  • One of the principal members will have to prove South Dakota residency

  • A sworn letter addressing applicable zoning restrictions

  • Local registration, licensing, or a permit where applicable

Applications must also include a list of standard operating procedures (SOPs), including:

  • Security reporting – lighting, physical security, alarm requirements, and cannabis theft

  • Quality assurance and quality control – test results for every product including samples

  • Recall procedures

  • Packaging and labeling

  • Inventory control, storage, and diversion prevention

  • Recordkeeping processes

  • Waste disposal/sanitation upkeep

  • Cultivation, manufacturing, retail marijuana sales, delivery, storage, and secure transport (as applicable)

  • Accounting and tax compliance measures

If you need help creating your SOPs, download these free Dispensary Standard Operating Procedure templates 👉

General cannabis dispensary requirements

Legal reference

34-20G-61. Criminal background check of medical cannabis establishment officers, employees, and volunteers.

Each medical cannabis establishment shall conduct a background check into the criminal history of each person seeking to become a principal officer, board member, agent, volunteer, or employee before the person begins working at the medical cannabis establishment.

34-20G-62. Employment restrictions on medical cannabis establishments.

A medical cannabis establishment may not employ any person who:

(1) Was convicted of a disqualifying felony offense; or

(2) Is under twenty-one years of age.

34-20G-63. Medical cannabis establishment procedures for oversight and record keeping.

Each medical cannabis establishment shall have operating documents that include procedures for the oversight of the medical cannabis establishment and procedures to ensure accurate record keeping.

34-20G-64. Medical cannabis establishment security measures.

A medical cannabis establishment shall implement appropriate security measures designed to deter and prevent the theft of cannabis and unauthorized entrance into any area containing cannabis.

34-20G-69. Inspection of medical cannabis establishments.

A medical cannabis establishment is subject to inspection by the department during business hours.

General requirements include:

  • Every officer, employee, and volunteer must pass a criminal background check

  • Every staff member must be over the age of 21

  • Dispensaries must adhere to procedures for accurate record keeping

  • The cannabis products must be safeguarded for security and remain out of sight to minors

  • Medical dispensaries need to be inspection-ready at all business hours

Also, consider attending a Metrc meeting about the current seed-to-sale regulatory processes in South Dakota. A deep understanding of Metrc is important to remain compliant in the state.

Restrictions for medical cannabis establishments

Legal reference

34-20G-62. Employment restrictions on medical cannabis establishments.

A medical cannabis establishment may not employ any person who:

(1) Was convicted of a disqualifying felony offense; or

(2) Is under twenty-one years of age.

34-20G-67. Sharing office space and patient referrals to practitioners prohibited.

A medical cannabis establishment may not share office space with or refer a patient to a practitioner.

34-20G-68. Consumption of cannabis on medical cannabis establishment property prohibited.

A medical cannabis establishment may not permit any person to consume cannabis on the property of a medical cannabis establishment.

Medical cannabis establishments are restricted from:

  • Hiring anyone under 21 or with a conviction of a disqualifying felony offense

  • Sharing office space with a practitioner

  • Referring patients to a specific medical marijuana doctor

  • Consuming cannabis on dispensary property

Conditions for dispensing cannabis

Legal reference

34-20G-70. Conditions for dispensing cannabis.

Before cannabis may be dispensed to a cardholder or nonresident cardholder, a dispensary agent:

(1) Shall verify that the registry identification card or registration presented to the dispensary is valid;

(2) Shall verify the identity of the person by requiring the person to present a valid photographic identification document issued by this state, another state, tribe, or the federal government;

(3) May not dispense an amount of cannabis to a person that would cause the person to possess more than the allowable amount of cannabis; and

(4) Shall verify that the dispensary is the current dispensary that was designated by the cardholder or nonresident cardholder.

34-20G-71. Limitations on amount of cannabis dispensed.

A dispensary may not dispense more than three ounces of cannabis to a nonresident cardholder or a registered qualifying patient, directly or via a designated caregiver, in any fourteen-day period. A dispensary shall ensure compliance with the limitation under this section by maintaining internal, confidential records that include records specifying how much cannabis is dispensed to a nonresident cardholder or registered qualifying patient and whether it is dispensed directly to a registered qualifying patient or to the designated caregiver.

Dispensaries must follow the following conditions when dispensing cannabis:

  • A medical marijuana card must be valid and match the customer’s photo ID
  • Medical patients can be non-residents as long as their information is valid
  • Purchase amounts need to stay within the patient’s allotted limit of 3 ounces of cannabis (within a 14-day period)
  • Budtenders have to verify a patient’s proper dispensary designation in the medical cannabis program before dispensing cannabis product

Privacy and data requirements

Legal reference

34-20G-89. Restrictions on data maintained by medical cannabis establishments.

Any information kept or maintained by a medical cannabis establishment may only identify a cardholder by registry identification number and may not contain names or other personal identifying information.

34-20G-90. Cardholder's request for department to confirm cardholder status to others.

At the cardholder's request, the department may confirm the cardholder's status as a registered qualifying patient or a registered designated caregiver to a third party, such as a landlord, school, medical professional, or court.

34-20G-91. Destruction of unused media containing cardholder information.

Any department hard drive or other data-recording media that is no longer in use and that contains cardholder information shall be destroyed.

Medical dispensaries must follow these data and privacy rules:

  • Patient information stored on file must only contain a cardholder’s registration ID number and shouldn’t include a name or any identifying information

  • At a patient’s request, the department can confirm their protected cardholder status

  • Dispensaries must destroy any out-of-date or previously-recorded dispensary or department data about a patient for their privacy

South Dakota cannabis laws FAQs

How much weed can I buy in South Dakota?

South Dakota state law permits the purchase of 3 ounces of cannabis flower (or equivalent amounts of related products like concentrates, edibles, vapes, etc.) every 14 days for medical purposes. This limit includes dispensary sales made to the patient’s registered caregiver.

Can I grow marijuana plants in South Dakota?

South Dakota laws permit medical marijuana patients in South Dakota to grow up to four cannabis plants for the medical use of cannabis.

Is marijuana illegal in South Dakota?

Cannabis laws in South Dakota have allowed qualifying patients to consume medicinally since July 1, 2021. The ballot initiative took place on November 3, 2020 and legalized medical marijuana use only.

How is cannabis taxed in South Dakota?

Cannabis patients are taxed in South Dakota by sales tax or use tax. Both tax percentages are 4.5%. A municipal tax could also apply if the cannabis purchase occurs within city limits.

Is Flowhub compliant in South Dakota?

Yes! Flowhub was the original integrator with Metrc (South Dakota’s regulatory traceability system) so we have a deep understanding of how to keep South Dakota dispensaries compliant. We also are compliant with the state’s unique cannabis regulations.

Disclaimer: The material contained on this website and any attached or referenced pages has been compiled by Flowhub for informational purposes only. It is not intended to be and is not considered to be legal advice. This post is current as of 9/8/22. Cannabis regulations are rapidly changing, and legal advice of any nature should be sought from legal counsel.

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