7/1/10 “Black Thursday”
Try as I might, I cannot possibly get to all of you before Thursday (I have tried!). Accordingly, I am writing this blog in an effort to address various issues that appear common to most MMJ business people.
1. 7/1/10 is the effective date for all MMJ businesses going forward. I understand that Mr. Matt Cook has told some of you that you have until 7/1/11 to comply. This is not the case. I have spoken with Mr. Cook and corresponded with him on several occassions. In his correspondence he makes clear that your MMC and/or MIP application will be evaluated using the 7/1/10 date. For those of you seeking to add a retail or add a grow after 7/1/10, Mr. Cook advises that both aspects of the MMC must be locally approved on or before 7/1/10.
2. There is no one year state moratorium. However, there is a defacto moratorium in that you cannot operate after 7/1/10 unless you were “established”/locally approved for both the grow and retail location(s) before 7/1/10. Otherwise, you cannot operate until both local and state approval are obtained.
3. Hash is going to be considered an “infused product.” The distinction provided by Mr. Cook is that green stuff in a bag is for MMCs, everything else is for MIPs.
4. There can be no deliveries except in the narrow circumstances provided in HB1284.
5. One grow can supply a MMC with multiple locations and common ownership.
6. One grow cannot supply MMJ to mulitiple MMCs not wholly and commonly owned by the same people. NO INDEPENDENT CONTRACTOR GROWS NO MATTER WHAT ANYONE IS TELLING YOU!!!
7. The residency, “no felony w/i five years of completion of sentence” and “no felony drug convictions ever” standards apply for owners, employees and managers of the MMC. The criminal background issues apply equally to investors.
8. The 70/30 rule applies on 7/1/10 and the certification is due 9/1/10. Again, in evaluating your application and 70/30 certification, the state will look back to 7/1/10.
9. MIPs must be locally approved by 7/1/10 to be considered established under HB1284 even if there is no such licensing procedure locally available.
10. The MIP may, but is not required to, grow its own MMJ using a locally approved OPC or may contract, in writing, with up to 5 MMCs to purchase the MMJ for use in making the products. The MIP MMJ cannot be resold to any other business or person, but the MIP can sell its products to any MMC.
I know how hard it is out there. Better to be on the sideline and do it right, then be further down the road doing it wrong. Remember, doing it wrong can result in delay, denial, permanent bar from future MMJ business or removal of any protection from criminal prosecution.
Stay legal, stay safe.
MMC and patient assignment – a follow up to the 70/30 rule
Further to my previous post, a MMC’s inventory is measured by the number of patients that assign the MMC as their “primary center” times two ounces per patient (I am not dealing with the “edibles”/medical necessity issues here) and can only grow 6 plants for each assigned patient. The question is how do we do this? The answer is not simple and has not yet been considered by the Dept. of Revenue or Dept. of Health. As with most MMJ issues, we must solve the problem ourselves and wait for the state to catch up. As with all MMC issues, prior to 7/1/10 is the date to accomplish this.
Accordingly, I suggest that the primary caregivers associated with the MMC have their patients assign the MMC as their “primary center.” Since their is no form or procedure for this, I suggest using the Change of Primary Caregiver form issued by the Dept. of Health. Instead of inserting a person’s name as the PC, I suggest inserting the MMC’s name, address, etc. Otherwise, fill out the form as required by the Dept. of Health and have the document notarized and mailed to the Dept. of Health, certified mail, return receipt requested. The state may reject the form, but at least you have timely proof of conversion from primary caregiver to primary center. Keep the proof handy, including the original patient cards, change of caregiver forms and return receipts as evidence of an unbroken chain of legal caregiving/care centering.
Finally, there are many patients you cannot locate. I suggest sending the Dept. of Health a letter detailing the patients that have changed from you as a PC to the MMC. Next, list each of the patients you were unable to locate and advise the state that “I am listed as the primary caregiver for the following patients listed below. I have tried to contact these patients, but am unable to do so. Accordingly, let this letter serve as notice that I am unwilling to act as the primary caregiver for the patients listed below effective immediately. If you have any means of contacting these patients, please advise them that I am no longer their primary caregiver.” Again, notarize and send this letter to the Dept. of Health AND Dept. of Revenue, attn. Mr. Matt Cook, certified mail/return receipt requested.
Someday the state will create its own procedure and form for designating a primary center and you get to do this all over again!
Keep all the records handy, organized and a copy at the MMC and any optional grow premises.
Primary Caregiving post HB1284
HB1284 goes into effect on 7/1/10. This restrict all primary caregiving to five patients or less, requires the provision of “other services” as set forth in the Clendenin case, and providing the MMJ for cost only. No two (or more) primary caregivers can work together, share a grow, etc. and no primary caregiving duties can be delegated (grow assistance, delivery, etc.). Finally, you cannot ever sell your “excess” medicine to medical marijuana centers.
Meeting with Matt Cook
I just completed my meeting with Mr. Matt Cook, the current head of the Department of Revenue Medical Marijuana Business Division. I clarified several points that concern MMJ businesses:
1. All MMJ Centers must be locally approved for both the cultivation and retail sale of medical marijuana by 7/1. I understand this presents many logistical problems, but it is true nonetheless;
2. There is no state moratorium on new MMJ businesses (that was just in the bill summary) but local approval and state approval is required BEFORE any operation of that business.
3. Hash is likely to be considered an infused product and its creation is likely to be limited to Infused Product Manufactures. He stated that MMC’s are going to be able to create “raw product” only and that is likely to include clones.
4. The no felony within five years of the completion of sentence and no felony drug convictions ever is going to apply to employees, managers, investors, etc., as well as owners.
5. The two year residency requirement is likely to apply to employees and managers, not just owner/licensees.
6. The corporate structure for a MMC is simplistic: one business handling both the grow and cultivation, which is locally approved for both activities. This means no corporations owning corporations. While this is permitted as a matter of corporate law and may evolve in the future, I suggest you give the state what it expects to see.
6. Growers may not be “employed” by more that one MMC and, under no circumstances, can exist as a seperate business.
7. Owners of MMCs can still be a primary caregiver for 5 patients, but all activities must be separate from the MMC (no selling excess from your patient grow!).
8. In examining your MMC/MIP application, the state will refer back to 7/1/10 to establish your compliance with HB1284.
10. Service business will be allowed, like a grow consultant, but be careful not to blur the lines between consultant and grower.
11. The rules will be created over a six month process and will be binding. That means what Mr. Cook says today may or may not be established by rule in the future. Anticipate the most conservative view of HB1284 and expand beyond that when the rule permits such expansion.
I hope this helps guide you efforts to comply with the new regulations.