Relating to the medical use of low-THC cannabis under and the administration of the Texas Compassionate-Use Program; requiring registration.

Contracts

• Commercial Leases: Do not sign leases for satellite locations without a contingency clause accounting for the 180-day regulatory approval window allocated to DPS.
• M&A/Buy-Sell Agreements: Closing conditions must be tied to DPS registration confirmation of the transferee (buyer), not merely funding or signing. Transferring a license before the buyer is fully registered is now a statutory violation.
• Employment Offers: Offer letters must be revised to state that employment is explicitly contingent upon prior DPS registration.

Hiring/Training

• Pre-Employment Vetting: The "hire, then background check" workflow is now illegal. You must submit the name of any prospective manager or employee to DPS and receive registration confirmation before they are hired.
• Staffing Freeze: You cannot onboard staff for new locations until those locations are approved and the individuals are registered.

Reporting & Record-Keeping

• Satellite Applications: A specific application must be filed for every proposed satellite location.
• Product Formulation Logs: You must audit all SKUs immediately. Any package containing more than 1 gram of THC or any dosage unit exceeding 10mg of THC is non-compliant.
• Chain of Custody: Enhanced tracking is required for all raw materials and by-products to prevent diversion.

Fees & Costs

• Licensure Fees: While exact amounts will be set by rule, the Legislative Budget Board Fiscal Note projects $5.3 million in original license fee revenue for FY2026. Applicants should budget for six-figure licensure fees.
• Capitalization: Applicants must demonstrate sufficient capital to sustain operations for two years without revenue, as implied by the "competitive evaluation" criteria.