Marijuana industry delays precipitated by Delaware, FBI disagreement

Why Should Delaware Care?
Delaware’s marijuana industry remains stalled and will miss its April launch date, further delaying the plans of over 100 business operators statewide. While state officials claim the delay was due to pending FBI approval for background checks, the FBI now says Delaware submitted a non-compliant application and only recently corrected it – suggesting the delay was caused by the state all along.

Last month, Delaware marijuana regulators said their launch of the state’s recreational cannabis market was delayed because of a pending FBI approval needed to set up a fingerprinting system for criminal background checks of people seeking to get into the marijuana business.

What they didn’t say was that the FBI had already denied the state’s application for the fingerprinting system two months earlier. 

Spotlight Delaware learned of the denial last week after FBI officials said in a statement that they had made the decision because a Delaware statute that sets up regulations for fingerprinting didn’t “qualify pursuant to federal law.” 

The federal officials did not say why the state’s statute didn’t qualify. But they did reveal that state regulators had reapplied for the fingerprinting approval, just last week. 

It is not clear how the state’s renewed application differs from its original. 

What is clear is that the FBI’s denial has placed the timely launch of Delaware’s fledgling marijuana industry into question. It now appears to be paused unless and until the state’s second request to the FBI can be approved. 

For their part, state officials contend that the FBI had approved similar fingerprinting regulations in past years for Delaware’s medical marijuana program.

“It is important to note that a previous bill with the same criteria had been approved, and we sought clarification and reconsideration of the FBI’s determination,” said Keila Montalvo, spokeswoman for the Delaware Office of the Marijuana Commissioner. 

Montalvo said her office has reviewed the FBI’s feedback on their initial application in coordination with officials from the Delaware Department of Justice. Attorneys for the state have since sent a “reconsideration request and contacted the FBI to discuss the matter,” she said. 

“We remain committed to working with our partners at the FBI to ensure compliance with federal law and to move this process forward as efficiently as possible,” Montalvo said.

Asked why Delaware officials last month said their application was pending approval when it instead had been denied, Montalvo contended that the application “was (and still is) pending final approval from the FBI.” 

“We cannot proceed until we receive that approval,” Montalvo said. 

In its statement last week, the FBI acknowledged that its officials are reconsidering Delaware’s application but they have “not yet completed [their] re-review.” 

“Once finalized, we will respond to the Delaware State Bureau of Investigation,” the FBI said in its statement, which was sent from the agency press office and did not include the name of the sender. 

The marijuana market delayed

Two years ago, Delaware passed a law to legalize recreational marijuana and had targeted the spring of 2025 for the opening of shops for adult-use purchases. 

At the end of last year, the Office of the Marijuana Commissioner, the state body responsible for regulating the industry, selected 125 people through a lottery to receive licenses to operate businesses for cultivation, manufacturing, testing, and selling marijuana.  

Entering the lottery required individuals to submit detailed applications and pay fees of up to $5,000. 

Those selected then had to submit secondary applications with detailed information on their business plan, and financial and personal background, which is being reviewed by a newly developed Marijuana Enforcement Unit within the Delaware Division of Alcohol and Tobacco Enforcement.

But the new licensees have grown frustrated over the unclear timeline and delays, which some say have impacted their business plans. And despite being selected to operate in the state, operators have not received their conditional licenses, leaving them with only their lottery selection notifications.

Last month, the Delaware Office of the Marijuana Commissioner, said they were still conducting background checks on the selected business operators. 

But a criminal background check also is a key part of that process. And the state can’t move forward with that aspect of the background check unless it receives a service code from the FBI, which would authorize Delaware to fingerprint individuals.

The code would be used for applicants to schedule fingerprinting appointments, allowing the State Bureau of Identification to generate criminal history reports and conduct background investigations on operators, Montalvo said.

A murky timeline 

In early February, the Office of the Marijuana Commissioner told Spotlight Delaware that its “application for fingerprinting authorization is pending final approval from the Federal Bureau of Investigation.”

The state’s application to the FBI was submitted in October 2024 by the Delaware State Bureau of Identification, according to FBI officials. 

The application needed a state statute for FBI review and approval. For Delaware, that was House Bill 334, which passed last year.

But FBI officials say they advised the Delaware State Bureau of Identification in December 2024 that the state statute “did not qualify pursuant to federal law.”

House Bill 334, sponsored by House Majority Whip Ed Osienski (D-Newark), fine-tunes Delaware’s marijuana industry rules by clarifying enforcement powers and regulations for criminal background checks while making other technical updates for businesses. 

State officials have yet to release any timeline as to when marijuana shops will open in the state. But last month, Montalvo told Spotlight Delaware that once operators receive their conditional licenses, they will have 18 months to establish their businesses.

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