Cannabis Compliance: State Laws and Regulations

Whether you grow, distribute, or sell cannabis, business owners must implement and maintain a 24/7 video surveillance system. While compliance laws vary by state, most minimum security requirements mandate:

• All licensees shall have immediate access to the surveillance recordings
• Licensees must record in areas that include:
  • - Where cannabis is grown, weighed, packed, stored, loaded, and unloaded;
  • - Prepared or moved within the licensed premises;
  • - Security rooms
  • - Entrances and exits to all licensed premises,
• Licensed micro-business owners and retailers must record in each point-of-sale location and security rooms.
• Be able to effectively and clearly record images of the area under surveillance
• The business owner must store video recordings for a minimum of 40 calendar days – some states require up to 90 days.
• The physical media or storage device on which surveillance recordings are stored shall be secured to protect the recording from tampering or theft.
• Surveillance recordings are subject to inspection by the Bureau. They should be kept in a manner that allows the Bureau to view and obtain copies of the recordings at the licensed premises immediately upon request.
• Licensees may also be required to develop and maintain a security plan. Details include strategies for on-site protection from theft, fire, and chemical spills – and how you’ll minimize those risks with adequate storage, alarms, internal theft, and cameras.

What’s the Cost of Violating Compliance in the Cannabis Industry?

Failure to comply with security requirements can result in surrendering licenses, prison time, and expulsion from the industry altogether. In California, each compliance discrepancy can cost as much as $5,000 in fines – amounting to four times as much as the license itself!

Video surveillance solutions fall into two main categories: on-premise and cloud-based security systems. But, which solution is most useful for cannabis businesses? While implementing a traditional system seems simple enough, it tends to get more complicated when you require additional cameras or increased storage -- especially when state laws evolve or transition from a single to a multi-site business.

On-Premise Security – Is it Right For Your Business?

Traditional systems can be a great solution for many aspects of your cannabis operation, but there are also limitations and risks associated with an on-premise solution. Determining the camera count based on key coverage areas is critical to ensuring that you purchase a system that can support those needs. Security solutions professionals can help you interpret and design a system that complies with your state compliance regulations.

A Hands-On Approach

A traditional on-premise system presents some limitations. For example, it requires you to determine how many channels you’ll need to support your video security requirements at the time of purchase. When you factor in ongoing maintenance costs and technology upgrades (including the need for advanced intrusion detection analytics, flexible storage, and additional cameras over time), the cost it takes to scale up with a traditional system can also increase over time.

Limited Scalability

As your business grows, you may want to add more cameras to cover additional facilities or coverage areas. You’ll need to preplan those needs with your installer to ensure you have channel counts that can grow with your business. A traditional system requires a more thorough process on the front-end to meet your long-term needs – from both a camera count and storage perspective.

The Risks of Storing Video Footage On-Premise

If your traditional system goes down due to a failed hard drive, or a break-in results in a damaged/destroyed recorder, this will result in a system being offline until it’s repaired or replaced. Because 24/7 surveillance is required by law, this downtime puts businesses in a vulnerable position – potentially leading to a violation if audited. Unfortunately, many small business owners don’t have the infrastructure to support the high-level ‘hands-on’ security a traditional system requires. Cannabis businesses need a security system that offers enough flexibility to back up their data should the unexpected occur – and which provides a cost-effective approach to meet all compliance demands.

Cloud-Based Security - Hands-Off, Flexible and Scalable

Cloud-based systems offer an immediate advantage to cannabis business owners: because data is transferred from the camera to the Cloud in a secure, off-site data center, it eliminates the risk of and need for on-premise recording devices.

Unlike on-premise systems where everything within your security system is the owner’s responsibility (from ongoing maintenance to the physical equipment to data retention), cloud-based video security offers end-to-end encryption, automatic maintenance, and zero recording equipment to manage.

A significant benefit of cloud surveillance for cannabis business owners is its automated and scalable capabilities. Whether you need to add additional cameras or scale up your storage to meet compliance laws, a cloud-based solution offers owners easy multi-site, multi-user scalability. Add more cameras for additional locations and unlimited users as you need to.

When you consider the long-term repairs and resources required of a traditional system (such as hardware, network failures, and a dedicated IT team to monitor and manage security), cloud surveillance can lead to a more cost-effective solution.When you consider the long-term repairs and resources required of a traditional system (such as hardware, network failures, and a dedicated IT team to monitor and manage security), cloud surveillance can lead to a more cost-effective solution.

How Will a Cloud-Based System Meet Cannabis Compliance Over Time?

As more states legalize marijuana, business owners should expect and prepare for security requirements to become stricter over time. When choosing a security system – or determining if the one you already have in place is sufficient – it’s essential to consider if it meets every aspect of cannabis-specific compliance.

Cloud surveillance solutions offer more flexibility and scalability than traditional systems – making it an ideal long-term solution. Because video evidence is stored in a secure data center, it helps cannabis owners meet off-premise storage requirements by eliminating any hardware or on-premise equipment to manage. It also removes any security risks that occur with physical equipment failures or damage.

How Does Alibi Cloud VS Help Cannabis Businesses Provide Robust Video Security While Adhering to Compliance Regulations?

Cannabis business owners are vulnerable to compliance audits at any point in the distribution chain – and face laws that change over time. Like California and Colorado, some states have changed their requirement in how long video footage must be stored – and have increased that requirement from 30 to 90 days or more.

Alibi Cloud VS not only offers an ultra-secure solution that includes end-to-end encryption, appropriate firewalls, and triple redundancy but flexible storage options as well. While a cannabis owner can invest in an on-premise security system to handle the organization’s footage and storage, a cloud security system offers a more flexible and scalable infrastructure that meets the physical, operational, and technical requirements specific to compliance and the cannabis industry.

Critical Compliance Criteria: Off-Premise Storage and Data Retention

Cloud can be an alternative option for business owners who need a security system added to multiple locations. At the same time, it puts control back in the end-user's hands—with one login and account.

No matter what state you’re in, cannabis compliance requires an off-premise solution to adequately retain video evidence– one that a traditional system is not always set up to support. While most states require a security plan to include a minimum of 40 days of retention, other states like California require video footage kept for a minimum of 90 days. Some insurance companies mandate footage up to a year – no matter where your business resides.

A cloud-based solution is ideally suited to meet the unique challenges and compliance guidelines of the cannabis industry. This includes several state-mandated compliance requirements:

• Camera coverage for all key areas – including each point-of-sale, entrance, exit, and inventory and rooms any area where cash and cannabis is handled
• Sophisticated Analytics technology - for object and people recognition that instantly notifies users by email and or mobile devices when unauthorized individuals have entered restricted areas
• Multi-site management - including the ability to add cameras and users from multiple locations.

Multi-User Management

Cannabis owners can face high turnover and frequent staff changes. Granting individual shift managers access (or disable them from your system) can become tedious and time-consuming with an on-premise recorder. It requires you to log into each separate location and adjust their permissions manually. Cloud VS allows you to save time and energy by quickly adding, disabling, and granting special permissions to an unlimited number of users within minutes - all done remotely from a single dashboard. Because everything is handled in the Cloud, users can then login and access any location or camera you grant them permissions to, click on the footage by time and or event, and seamlessly watch or download the video footage.

Scalability to Support Growth

A cannabis business requires a surveillance system that can offer flexibility as its liability, compliance, and security needs change. Cloud VS provides a truly scalable solution that makes it simple to secure your expanding business by increasing or decreasing your storage, users, cameras, or permissions within minutes. Want additional cameras added to oversee your store, warehouse, or crops, or do you need to grant new managers access to your network? It’s as simple as the click of a mouse.

Multi-Site Management – A Simplified Solution for Unlimited Locations

Managing multiple recorders and cameras can be a tedious, time-consuming task, which only gets more complicated as your business grows. With Cloud VS, cannabis business owners can rely on a simplified cloud-based security system to ensure all locations, employees, and assets remain secure within one network. Customize your views by region, city, and critical area of each site (like entrances/exits or anywhere cash or plants/inventory are kept) so you can easily watch over your businesses’ most vital aspects. You don’t even have to worry about scheduling maintenance or hiring a team to perform security upgrades. It’s all handled automatically for you in the Cloud.