San Felasco's approval came after an administrative law judge ruled in February that health officials wrongly rejected the nursery's application last year because of a decade-old drug crime.
The nursery's approval to start the process of growing medical marijuana was also made possible by a new law, passed by the Legislature during the session that ended in March and signed by Gov. Rick Scott less than two weeks ago.
The new law authorized full-strength marijuana for terminally ill patients and also addressed long-running problems in carrying out a 2014 cannabis law that was primarily billed as a way to help children with severe forms of epilepsy.
Doctors were supposed to begin ordering the non-euphoric cannabis products for patients more than a year ago, but administrative issues and legal challenges delayed implementation of the 2014 law, spurring frustrated lawmakers to propose the changes in this year's legislation.
Health officials in November selected five nurseries, of more than a dozen that sought licenses, to become "dispensing organizations" that would grow, process and distribute low-THC marijuana. Three of those sought-after licenses were challenged, including one in the Northeast region, where San Felasco lost out to another grower, Chestnut Hill Nurseries.
Under the new law, the five dispensing organizations can keep their licenses, and applicants whose challenges are successful can also get licenses. The law gave the Department of Health until Monday to approve as dispensing organizations applicants that had won legal challenges.
Health officials last year rejected San Felasco's application because Daniel Banks, the nursery's director of research and development, failed what is known as a "level 2" background screening. State law bans convicted felons from being owners or managers of the dispensing organizations.
But Administrative Law Judge R. Bruce McKibben ruled in February that health officials erroneously disqualified Banks.
Banks, then 18, pleaded no contest to illegal possession of Phenobarbital in Kansas in 2004. While the crime is a felony in Florida, it is a misdemeanor under Kansas law.
"And since he was charged in Kansas, not Florida, his crime was a misdemeanor, not a felony, for purposes of determining whether it was a disqualifying offense," McKibben wrote.
Banks later had his record expunged of the crime, which, under Kansas law, means "the conviction and nolo plea would not be a disqualifying event … because the conviction never happened," McKibben wrote.
In a letter dated Monday, health officials gave San Felasco 10 days to post a $5 million performance bond, required by law. The nursery has 75 days to request cultivation authorization.
Under the new law, the five nurseries —- and their affiliates —- chosen to grow, process and distribute marijuana low in euphoria-inducing THC will also be responsible for growing the full-strength medical marijuana for terminally ill patients. The expectation is that the same dispensing organizations would also be allowed to provide pot products to a vastly expanded patient base if a constitutional amendment on the November ballot passes. That proposed constitutional amendment would allow patients with a variety of conditions to have access to full-strength marijuana.
State health officials on Monday paved the way for Gainesville-based San Felasco Nurseries to join five other dispensing organizations authorized to grow medical marijuana in Florida.