Processor bond amounts by state
| State | Bond amount | Notes |
|---|---|---|
| Ohio | $250,000 | Bond or escrow under OAC 1301:18-3-08. |
| Utah | $50,000 | Cannabis processing facility performance bond. |
| California | $5,000 per license | All manufacturing license types. |
| Vermont | $2,500 Tier 2; $5,000 Tier 3 | Cessation of operations bond. |
| Nevada | $250,000 | Las Vegas production facilities, unless the City approves less. |
| Massachusetts | Equal to the license fee | Marijuana Product Manufacturers. |
| North Dakota | Set by the Department, up to $1,000,000 | Manufacturing facility compassion centers. |
Select a state for the statute or rule, the obligee, what the bond guarantees and the primary sources. States that are not listed do not require this bond at the state level, although a county or city may. See states with no statewide bond.
Why processors are bonded
A processor holds other licensees' product, works with solvents and pressurized equipment, and produces the items that are recalled most often. Regulators therefore use the bond to secure three costs: destroying non-compliant or abandoned product, cleaning up solvents and waste, and completing a recall the licensee cannot fund. Utah's form reaches every duty in its production establishment chapter, including recall protocols and waste disposal.
Underwriting
California and Vermont processor bonds are written on the application. Ohio's $250,000 bond and the Las Vegas $250,000 indemnity bond need personal and business financial statements, and underwriters will ask about extraction methods, fire code approvals and product liability coverage. A processor that also buys hemp may need a second, separate bond from the agriculture department. See hemp bonds.
What to send us
- The online application with the name, home address and Social Security number of each owner
- The amount and bond form your regulator gave you
- For bonds above $25,000: personal financial statements from owners of ten percent or more and current business financials
Questions
How much is a marijuana processor bond?
$250,000 in Ohio, $50,000 in Utah, $5,000 per license in California, $2,500 or $5,000 in Vermont and $250,000 for production facilities in Las Vegas.
Is an infuser or extractor a processor for bond purposes?
Usually. States use processor, manufacturer, producer, infuser and extractor for licenses that convert plant material into finished products. The bond follows the license your state issued.
Written and reviewed by C. Constantin Poindexter, MA, JD, CPCU, AFSB, ASLI, ARe, AINS, AIS, CPLP, CICS. Founder of Surety One, Inc., Cannabis Insurance Coverage Specialist, attorney and surety underwriter for more than thirty years. Author of The Contractor's Guide to Surety Bonds. View his cannabis insurance credentials. Last reviewed .