Understanding Bond Requirements for Florida MMTCs
Florida’s regulatory framework for Medical Marijuana Treatment Centers (MMTCs) includes a significant financial assurance requirement: the posting of a multi-million-dollar bond. This requirement is designed to protect the state and patients by ensuring that only financially stable entities operate as licensed MMTCs.
Below is a breakdown of the current bond requirements and practical guidance for MMTC applicants and license holders.
What Is the Required Bond Amount?
Florida Statutes § 381.986(8)(b)7. provides that, upon approval, an MMTC applicant must post a $5 million performance bond. This bond must be issued by a surety insurance company that is authorized to operate in Florida and holds one of the three highest ratings from a nationally recognized rating service.
However, there is a reduced bond option: MMTCs that serve at least 1,000 qualified patients may request to reduce their required bond amount to $2 million, upon approval by the Florida Department of Health (DOH).
Additional Rule-Based Requirements
Under Rule 64ER22-1, within ten business days after final licensure approval, the MMTC must provide financial assurance in one of the following forms:
A performance bond (most common)
An irrevocable letter of credit payable to the Department
A cash deposit with the Department
While all three options are permitted, the performance bond is by far the most widely used.
Costs and Timing
The cost to obtain a $5 million bond varies based on the creditworthiness and financial strength of the MMTC. Most applicants can expect to pay a premium of $250,000 to $350,000 for a two-year bond term.
Important tip: Start the bonding process early. MMTCs without sufficient assets or financial history may struggle to secure a bond, delaying or jeopardizing licensure.
Bond Obligations and Enforcement
The Florida Office of Medical Marijuana Use (OMMU) may collect on a bond to recover:
Damages resulting from the revocation or suspension of a license
Fines imposed by the Department that remain unpaid for 30 days
Applicants should also note:
Personal or co-guarantors are often required—especially for MMTCs with limited operating history.
The name of the bond principal must exactly match the licensed MMTC name.
Ongoing Compliance and Renewal
MMTCs must maintain an active bond at all times. Bonds are valid for a two-year term and must be renewed before expiration without any lapse in coverage. If a bond is canceled, revoked, or withdrawn, and the MMTC fails to provide replacement assurance by the effective date, the Department may revoke the MMTC license.
In change of ownership transactions, it’s critical to ensure that financial assurance coverage continues uninterrupted. Depending on the transaction structure, a new bond may be required—even if the license remains with the same corporate entity.
Bond Reduction for Serving 1,000+ Patients
Once an MMTC serves at least 1,000 qualified patients, it may apply to reduce its bond to $2 million. The DOH will verify the patient count using the Medical Marijuana Use Registry, which tracks all dispensations.
Resources and Forms
MMTC Bond Form:
Download the Bond FormBond Reduction Request Form:
Download the Reduction Request Form