SIERRA VISTA — More licenses to open cannabis dispensaries will be awarded by officials at the end of the year or the beginning of 2022, but individuals applying for this round of authorizations must meet criteria that include certain demographics and whether the applicant was affected by former marijuana laws.

The new licenses are called social equity licenses. Only residents in cities and unincorporated areas within 87 of Arizona’s 368 active zip codes can apply for them, said officials with the Arizona Department of Health Services, which oversees the licensing of marijuana dispensaries.

Steve Elliott, an ADHS spokesman, said anyone who meets the criteria and is interested in applying for a social equity license may do so between Dec. 1-14.

“After we receive the applications in the first half of December, there will be a drawing,” Elliott said. “The date hasn’t been set and will depend on how many applications we need to review.”

Three of the 87 zip codes identified are in Cochise County. They belong to Douglas — which has a city government — and Pirtleville and Naco, which are unincorporated areas.

Elliott said the zip codes were chosen after ADHS researched which parts of the state would meet the criteria established for the equity licenses.

“ADHS conducted an extensive analysis concerning whether a community meets the social equity program’s requirement of disproportionate impact from the enforcement of previous marijuana laws,” Elliott said. “This included a review of a variety of data sources, including research and analyses of criminal justice and socioeconomic data. The analysis included considerations of limitations within the various data sources.”

He said the zip codes chosen meet the requirements set by 2019 racial population data and 2019-20 data from the Arizona Department of Economic Security Supplemental Nutrition Assistance Program. They include aggregate population for Black/African American, American Indian/Alaska native and Hispanic greater than 50% of the total population. Racial groups excluded from this factor were not disproportionately impacted by the enforcement of previous marijuana laws and total population receiving SNAP benefits more than 25%.

Elliott said geography is only one of four criteria for the social equity program; applicants need to qualify in three of them.

The other requirements for applicants include:

Individual must have had a household income in at least three of the previous five years that, for the respective year, was less than 400% of the federal poverty level, which is the annual household income for a household of a particular size that is specified in the poverty guidelines updated annually in the Federal Register by the U.S. Department of Health and Human Services.

The individual must have been adversely affected by the enforcement of previous marijuana laws because the individual: a) Is eligible for and has petitioned for expungement according to A.R.S. § 36-2862; or b) the individual was convicted in Arizona of a violation of federal or state law related to marijuana or marijuana paraphernalia and does not have an excluded felony offense.

The individual has been adversely affected by the enforcement of previous marijuana laws because the individual is related, as one of the following, to another individual who was convicted in Arizona of a violation of federal or state laws related to marijuana or marijuana paraphernalia: (1) spouse; (2) surviving spouse, as defined in A.A.C. R9-1-301; (3) parent, as defined in A.A.C. R9-1-301; (4) child; (5) sibling; or (6) legal guardian, as defined in A.A.C. R9-1-301

The individual has a physical address, and has lived for at least three of the previous five years at the physical address, in a community that has been identified by the department as being disproportionately affected by the enforcement of Arizona’s previous marijuana laws.

In April, ADHS awarded dispensary licenses to all 15 Arizona counties — two licenses per county, or one license if the county already had one dispensary — following the passage of Proposition 207 in November’s election, which legalized the sale of recreational marijuana to anyone 21 and older.

The proposition requires that people buying recreational pot must pay a 16% excise tax, along with the regular sales tax. Marijuana dispensary owners also must pay licensing fees to the state, known as a transaction privilege tax.

According to the Arizona Department of Revenue, the money from taxes collected on the sales of recreational and medicinal marijuana in the first eight months of this year total $115,701,426. The funds are deposited into the Smart and Safe Arizona Fund, and after paying the administrative costs of certain agencies, the money is then distributed to community colleges, local law enforcement and fire departments, state and local transportation programs, public health and criminal justice programs and the Arizona Attorney General’s Office for enforcement.

Owners of the company that was awarded a dispensary license for Cochise County in the April ADHS drawing had applied to open a dispensary in Douglas. But officials of the company — Formula 420 Cannabis and based in Maricopa County — canceled the purchase of the property where it had proposed to build the dispensary, Douglas city officials and the realtor representing the license holder said.

In June, the realtor who had represented the company in Douglas contacted Sierra Vista city officials and asked them about the possibility of opening the dispensary there, said Sierra Vista Senior Planner Jeff Pregler. Nothing was finalized. Pregler told the Herald/Review last week the dispensary license holder contacted his office again earlier this month and asked more questions about opening the business.

Douglas city officials were displeased that the dispensary license winner decided against their municipality. Mayor Donald Huish and City Planner Peter Gardner have expressed a desire to have a dispensary in the city because of the tax revenues such businesses generate.

While Douglas is one of the zip code areas that meets the requirements for a social equity license, it’s not guaranteed that someone from Douglas who applies for a license in December will get chosen in the drawing, state officials said.

It’s unclear whether anyone in Douglas has sent the city an application to open a marijuana dispensary under the social equity licensing requirements. Gardner could not be reached for comment.

Cochise County spokeswoman Camila Rochin said no one from the county has applied for such a license thus far.