Sec.21a-408-30. Escrow account terms

(a) The producer’s two million dollar escrow account, letter of credit or surety bond shall be payable to the state of Connecticut in the event the commissioner determines, after a hearing pursuant to the Uniform Administrative Procedure Act, sections 4-166 to 4-189, inclusive, of the Connecticut General Statutes, that the producer has failed to timely and successfully complete the construction of a production facility or to continue to operate such facility in a manner that provides a substantially uninterrupted supply to its usual dispensary facility customers during the term of the license. 

(b) In addition to the other terms and conditions permitted by the Act and sections 21a-408-1 to 21a-408-72, inclusive, of the Regulations of Connecticut State Agencies, the commissioner shall permit the producer’s two million dollar escrow account, letter of credit or surety bond to be reduced by five-hundred thousand dollars upon the successful achievement of each of the following milestones, resulting in a potential elimination in the escrow account, letter of credit or surety bond: 

(1) A determination by the commissioner that the production facility is fully operational and able to commence production of marijuana as provided for in the license application of the producer; 

(2) A determination by the commissioner that the production facility remained operational without substantial interruption and without any violation of the Act or sections 21a-408-1 to 21a-408-72, inclusive, of the Regulations of Connecticut State Agencies for a one year period; 

(3) A determination by the commissioner that the production facility remained operational without substantial interruption and without any violation of the Act or sections 21a-408-1 to 21a-408-72, inclusive, of the Regulations of Connecticut State Agencies for an additional two consecutive years; and 

(4) A determination by the commissioner that the production facility remained operational without substantial interruption and without any violation of the Act or sections 21a-408-1 to 21a-408-72, inclusive, of the Regulations of Connecticut State Agencies for a second period of two consecutive years. 

(c) If a producer voluntarily chooses not to renew the producer license and provides notice of this decision in accordance with section 21a-408-23(f) of the Regulations of Connecticut State Agencies, the commissioner shall extinguish the obligations under the escrow account, letter of credit or surety bond at the end of the license term. 

(Effective September 6, 2013; Amended August 28, 2018)