Marijuana-impaired-driving-report-to-congress-2017
July 2017 Marijuana Impaired Driving Report to Congress
Medical marijuana super grows would be snuffed out under bill
LANSING, MI – The legislature is considering a bill that would limit medical marijuana growing licenses to 1,500 plants per location, something that’s the exact opposite of what the Department of Licensing and Regulatory Affairs has recommended as it crafts regulations for medical marijuana facilities.
The legislature last year passed a bill regulating medical marijuana facilities, including growing operations. Three types of growing licenses are allowed:
The Class A license allows a grow of up to 500 medical marijuana plants.
The Class B license allows a grow of up to 1,000 medical marijuana plants.
The Class C license allows a grow of up to 1,500 medical marijuana plants.
But LARA, which was left in charge of many of the details in implementing medical marijuana facilities regulations, signaled last month that it would allow even bigger grows by letting companies “stack” the largest licenses and grow many times 1,500 plants in one location.
Lobbyists try to shape Michigan’s medical marijuana rules before they’re made
Emails obtained by MLive and the Michigan Campaign Finance Network show a pattern of influence.
“It is the intent of the Bureau of Medical Marihuana Regulation to allow a potential licensee to apply for – and be granted – multiple (“stacked”) class C grow licenses in a single location,” wrote the department in a Sept. 28 press release.
That, said Rep. Jim Runestad, R-White Lake, is “beyond what I think many legislators intended.”
He is the sponsor of House Bill 5189, which would limit medical marijuana growers from holding more than one license at a single facility. He also chairs the House Judiciary Committee, which took testimony on the bill Tuesday morning.
“Having super-grows could potentially monopolize the market and may not be the direction that we would want to go immediately. Only time will tell who the good actors are and if it is reasonable to allow unlimited stacking of licenses per location,” Runestad told the committee.
Rep. Tim Greimel, D-Auburn Hills, questioned whether this bill would really quell monopolistic tendencies. It would still allow the same person to get multiple Class C licenses at different locations, he pointed out.
“That doesn’t reduce the likelihood of monopolistic control over licenses any more than having them in one location, does it?” Greimel asked.
Under the bill, local governments have to “opt in” if they want to license medical marijuana facilities. Two representatives from local communities had different takes on the bill in the House Judiciary Committee on Tuesday morning.
Small towns have big say on future of Michigan’s medical marijuana industry
Businesses are pushing local governments to allow medical marijuana within their boundaries.
Thetford Township Trustee Eric Gunnels said he supported the bill.
“I do think that we should be cautious, that we don’t allow, like you said, monopolies, monopolistic ventures to consolidate the market into the hands of a few,” Gunnels said.
But Bangor Township Supervisor Glenn Rowley said his area had a shrinking revenue stream and large industrial properties medical marijuana grows would bring to life. They already have a few large companies requesting local permits for multiple Class C grows. He opposes the bill.
“We want everyone to succeed,” Rowley said, adding he hoped they made a pile of money so big you need a Sherpa to get to the top of it.
Runestad said there was more testimony he couldn’t get to before the committee was scheduled to end. At this point, though, he thinks there are the votes to get it out of committee and is planning to take it up again at the committee’s next meeting.
Posted on October 31, 2017 By Emily Lawler
The More You Know-Top 5 Predatory Practices in California Cannabis
POSTED IN BUSINESS BASICS, CALIFORNIA, LICENSING
With temporary licensing on the horizon, California’s cannabis industry is obviously on the cusp of really big things. With this green rush, our California cannabis business attorneys have been brought on to work on all kinds of M&A deals and a bevy of MAUCRSA and local law regulatory compliance issues. These projects have exposed us to many who pitch various and sundry goods and services, claiming to offer “new paradigms” and “value adds,” but actually offering little to nothing.
In this post, I set out the five most common predatory practices we’re seeing in the Golden State cannabis industry so you can spot them when they’re coming at you and avoid them.
- Brokers. Whether it’s for M&A, financing, or finding real estate, many brokers are all too willing to sell cannabis companies down the river when it comes to compliance and just plain common sense. Far too many brokers neither know nor care about local or state law and they work only at cramming a deal down the parties’ throats to ensure they get their coveted commissions. Far too often we are getting brought into deals that involve unenforceable contracts or situations that will get one or both parties in trouble for failing to comply with local or state licensing, permitting, or operational laws or regulations.
- California cannabis businesses need to be careful in choosing their cannabis regulatory or business counsel. For twenty years there’s been no government oversight over medical cannabis operators and this has allowed some attorneys to unduly profit at the expense of their clients and their own ethical duties. And just because regulation is coming does not mean that some of these attorneys will stop their reckless, unethical, or incompetent ways. I’ve written before about how to avoid “OG legal advice,” but it goes further than that. If your cannabis attorney is willing to take a financial interest in your business but is not providing you with the requisite conflict waiver and opportunity for you to consult with outside legal counsel, that should be a huge red flag. If you know more about state and local regulations than your cannabis lawyer, that’s another red flag. If your cannabis attorney is trying to “lock” you into a long-term fee agreement that you can’t cancel at any time, that’s a massive red flag (yes, I have seen at least one self-proclaimed cannabis attorney with this sort of fee agreement). If your cannabis lawyer is encouraging you not to be transparent or not to get things in writing or is steering you away from basic business and corporate duties to try to hide things and/or assets, this is yet another red flag. These predatory attorneys will eventually be knocked out of California’s cannabis industry one or the other, but until then it’s buyer beware.
- Consultants. Out of all groups on this list, this one is generally the worst. Not only is it increasingly difficult to determine the value most cannabis consultants provide, there are way too many cannabis consultants running rackets because they themselves are blocked from pursuing licensure with the state or a given city or county. We also have seen more than our share of consultants trolling for cash by playing off the naiveté of would-be cannabis licensees. I recently reviewed a proposed agreement with a consultant who wanted seven figures per year for getting a company “through the political process” to receive a cannabis license, yet didn’t include anyenumerated services nor any end date. Seeing as how California’s Bureau of Cannabis Control has made clear that state licensing procedures will not be a difficult undertaking, the idea of politicking for licenses makes no sense and paying for such politicking makes even less sense. Don’t be fooled.
- Accountants. There’s nothing like talking to a would-be client who has no clue what 280E is yet is working with an accountant/CPA who claims to know cannabis taxation issues and charges premium rates for that “specialized advice.” You need to make sure your accountant/CPA truly knows how to navigate 280E, but above all you want your accountant to be a competent tax professional. All too often we run into accountants who claim to be experts for cannabis businesses that do shoddy jobs on standard accounting or are impossible to reach when their clients need them. In other words, choose your accountant/CPA wisely.
- Cannabis conferences and trade groups. Every time we turn around, there’s a new cannabis conference or trade group in California (or elsewhere). Folks have figured out that they can make serious money off the “Green Rush” by throwing events in major cities without much knowledge about anything cannabis-related, or that they can better market themselves and their personal agendas through setting up trade organizations. Few of these conferences have any educational value and most choose their speakers based on who pays for “membership” or “sponsorship.” Having paid to play, the speakers use these conferences mostly just to shamelessly pitch themselves or their products. We have heard of many expensive yet wildly disorganized conferences with speakers who were super stoned and conveyed nothing of value or importance. On the trade group front, watch where you put your money since many of these organizations are neither unified or even organized when it comes to any kind of meaningful mission for change. Be especially wary of self-appointed and deceptively misleading “task forces” that are not actually compiled and appointed by a given city or county, but rather set up to showcase the goods or services of the person or people who formed them. In other words, do your due diligence.
Michigan local governments take note – Rules emerge for medical marijuana facilities
With rules forthcoming from the Department of Licensing and Regulatory Affairs, Michigan State University Extension is offering training for local government on next steps in local regulation of medical marijuana facilities.
On September 21, 2016, Governor Snyder signed three new laws that clarify and add to the state’s voter-approved Michigan Medical Marihuana Act from 2008. The new laws give local governments the authority to regulate the number and location of commercial medical marijuana facilities, allow marijuana-infused products and create a “seed-to-sale” tracking system. The bills are now PA 281, 282, and 283 of 2016.
Public Act 281, the Medical Marihuana Facilities Licensing Act (MMFLA), creates a licensing and regulatory structure for five types of medical marijuana facilities: growers, processors, provisioning centers, secure transporters and safety compliance facilities. The act authorizes applications for state operating licenses beginning December 15, 2017.
That date is rapidly approaching and more and more Michigan local governments are discussing whether to allow medical marijuana facilities within their jurisdiction or not. To keep such facilities out, local governments need not take any action. To allow one or more facility type, local governments must pass an ordinance authorizing the facility type(s).
The MMFLA is absent particular details with respect to the required operations of medical marijuana facilities and the Michigan Department of Licensing and Regulatory Affairs (LARA) is charged with making rules to further regulate the five facility types. In particular, the Bureau of Medical Marihuana Regulation is responsible for the oversight of medical marijuana in Michigan. In September the Bureau of Medical Marihuana Regulation began releasing advisory bulletins for medical marijuana facilities.
In addition to providing prospective facility operators with the rules by which they must operate, the bulletins also provide local governments insights as to aspects of medical marijuana facilities that local ordinances can and cannot regulate.
Michigan State University Extension is offering training for local government officials on the latest medical marijuana facilities rules from LARA. Next Steps in Local Regulation of Medical Marijuana Facilities Webinar is a follow-up training to the winter/spring 2017 MSU Extension “Regulating Medical Marijuana Facilities: A Workshop for Local Government”.
The fall 2017 webinar will assume a base-level of understanding of the national and state context of medical marijuana, the overall regulatory framework in Michigan and local government roles in planning and zoning for uses of land.
The “Next Steps in Local Regulation of Medical Marijuana Facilities Webinar” will be delivered live at three different dates and times allowing participants to choose the option that works best: November 30, 2017, 6-8pm, December 4, 12:30-2:30pm and December 11, 6-8pm. The webinar will review Michigan’s medical marijuana facilities laws, summarize options for local government regulation, highlight ordinances that municipalities are adopting and compare approaches and detail state authority and the latest rules facilities must follow.
Those interested in the “Next Steps in Local Regulation of Medical Marijuana Facilities Webinar” may wish to first view a webinar recording of the winter/spring MSU Extension training – “Regulating Medical Marijuana Facilities: A Webinar for Local Government” presented on March 30, 2017. Information on how to access the webinar recording is available at http://msue.msu.edu/mmfla along with educational materials and resources from the earlier training.
To register for the “Next Steps in Local Regulation of Medical Marijuana Facilities Webinar” visit https://events.anr.msu.edu/mmfwebinar.
This article was published by Michigan State University Extension. For more information, visit http://www.msue.msu.edu. To have a digest of information delivered straight to your email inbox, visit http://www.msue.msu.edu/newsletters. To contact an expert in your area, visit http://expert.msue.msu.edu, or call 888-MSUE4MI (888-678-3464).
Marijuana’s Pay-To-Play Licensing Trend
Setting up ridiculously difficult requirements for licensing eligibility prioritizes the high profits of a few over industry efficiency, true competition, and patient/consumer rights.
State-sanctioned medical marijuana operational licenses are increasingly becoming a “pay-to-play, greatest barrier to entry” model. In this sort of system, there is usually some combination of the following, all geared towards minimizing the number of licensed cannabis businesses and towards making sure all those who get such licenses are very well-funded:
- A difficult and time consuming license application process;
- High application fees;
- An unreasonably short application window; and
- High minimum funding requirements.
To varying extents, Florida, Illinois, New York, Hawaii, Minnesota, and Nevada all have this sort of legalization regime.
Florida. In Florida, only five agricultural nurseries that have been in existence for at least the last thirty years were even eligible to be licensed as dispensing organizations under the state’s extremely limited medical marijuana program. From the few nurseries that qualified, the state prioritized financials in its scoring process and required all of the nurseries to post a $5 million dollar performance bond. In other words, if you weren’t a large and well-funded nursery that has been around for 30-plus years, forget about it. These five nurseries have nearly unfettered access to Florida’s population of 20 million and there’s a chance these five nurseries could end up being the sole providers of medical cannabis under Florida’s impending medical marijuana ballot initiative.
Illinois. Illinois allows only 21 cultivation centers and 60 dispensaries to serve all 13 million people in the state. Illinois set up a point system for judging cannabis licensing applicants based on their proposed security plans, their expertise in growing marijuana, and their plans for patient education. Cultivation centers were required to pay $200,000 for an initial license and have at least $500,000 in liquid assets, in addition to a non-refundable $25,000 application fee. Dispensaries were required to pay $30,000 for a license and have $400,000 in liquid assets, in addition to a non-refundable $5,000 application fee.
New York. Start-up costs for running a medical cannabis company in New York were estimated at around $25 million. The state required a $10,000 non-refundable application fee, plus a $200,000 refundable registration fee for each application. Those seeking a cannabis license also had to show they had the real estate necessary to produce cannabis or be able to post a $2 million bond. Only five operators are allowed to run up to 20 dispensaries throughout the state, and applicants had to produce a litany of documents for the state’s Department of Health that described, in detail, the applicant’s manufacturing processes, transporting, distributing, sale and dispensing policies or procedures. Not as exclusive as Florida, but that’s 20 dispensaries for 20 million people.
Hawaii. Hawaii kicked off its new MMJ legalization regime with a five-year residency requirement and the requirement that its MMJ companies be majority-owned by Hawaiians. Hawaii has some of the toughest, most protectionist cannabis regulations and barriers to market entry in the country. It is set to have only 16 dispensaries in the state, and business applicants also needed to show $1,000,000 “for each license applied for,” and “not less than $100,000 for each retail dispensing location,” all of which had to be under the control of the applicant for no less than 90 days prior to the date of application. There was also a $5,000 non-refundable application fee for each license. Applicants awarded with licenses had to pay $75,000 for each license within a week of approval. Dispensary licensees must also pay an annual renewal fee of $50,000.
Minnesota. Minnesota has an extremely limited medical cannabis program. First, only two operators serve the entire state for cultivation, manufacturing, and distribution. The two operators each operate four dispensaries in the state, for a total of eight. The two operators were selected after the state reviewed their personal histories and capabilities with respect to cultivation, manufacturing, and patient services — these folks even had to commit to having a licensed pharmacist on staff to distribute the cannabis (which makes little sense since cannabis cannot be legally prescribed). And, of course, the state also assessed their financial stability and business plans. One of the operators, Leafline, reportedly raised $12.4 million in investment from 113 investors. All of this for a state that, at the time, claimed to have only 5,000 registered qualifying patients.
Nevada. In Nevada, running a marijuana business is like running a casino — it’s capital-intensive and only a select few get to participate. Nevada requires local control of its cannabis businesses and its license applicants needed to show no less than $250,000 in liquidity. They also had to produce volumes of documents showing detailed floor plans, security, personnel manuals, and even advertising and marketing plans, all of which were scored against a strict point system. In addition, the application fee was a non-refundable $5,000, and the license issuance fee (per license) is $30,000.
All of the above states have created massive barriers to entering into their medical marijuana industries. On the flip side, all four states (Colorado, Washington, Oregon, and Alaska) that legalized recreational marijuana do not have nearly the barriers to entry as these medical states.
Though it makes sense for states to want to closely hew to the priorities set forth in the 2013 Cole memo, setting up ridiculously difficult requirements for licensing eligibility prioritizes the high profits of a few over industry efficiency, true competition, and patient/consumer rights. The medical marijuana states have set up uneven playing fields that give the already wealthy near monopoly power over medical cannabis. How is this a good system for anyone but the few who have bestowed with the spoils?
I can only hope that Colorado, Washington, Oregon, and Alaska will eventually serve as models in in showing how letting the marketplace choose cannabis winners and losers is preferable to patronage systems with high barriers to licensing. So far, these recreational-legal states are proving that market entry equality and the priorities set forth in the Cole memo can be squared.
Hilary Bricken is an attorney at Harris Moure, PLLC in Seattle
Study Explains Why Hemp and Marijuana are Different
Genetic differences between hemp and marijuana determine whether Cannabis plants have the potential for psychoactivity, a new study by University of Minnesota scientists shows.
“Given the diversity of cultivated forms of Cannabis, we wanted to identify the genes responsible for differences in drug content,” says U of M plant biologist George Weiblen. While marijuana is rich in psychoactive tetrahydrocannabinol (THC), hemp produces mostly a non-euphoric cannabidiol (CBD), but the genetic basis for this difference was a matter of speculation until now. The study was published in the July 17 online edition of New Phytologist.
The discovery of a single gene distinguishing the two varieties, which according to Weiblen took more than 12 years of research, could strengthen hemp producers’ argument that their products should not be subject to the same narcotics laws as hemp’s cannabinoid cousin. Since 1970, all Cannabis plants have been classified as controlled substances by the federal government, but nearly half of all states, including Minnesota, now define hemp as distinct from marijuana. Efforts to revise hemp’s U.S. legal status so that it could again be cultivated commercially have gained momentum in recent years.
The market for hemp seed and fiber in the U.S. surpassed $600 million last year alone. But despite the plant’s surging popularity as an ingredient in food, personal care products, clothing and even construction, commercial hemp cultivation is prohibited by the federal government. Currently, all hemp products are imported to the U.S.
Research on hemp is tightly controlled by government regulations. Weiblen and his co-authors at the University of Mississippi are among few labs in the country with the federal clearance to study Cannabis.
“It’s a plant of major economic importance that is very poorly understood scientifically. With this study, we have indisputable evidence for a genetic basis of differences among Cannabis varieties,” says Weiblen, “further challenging the position that all Cannabis should be regulated as a drug.”
Weiblen is a professor with a joint appointment in the University of Minnesota’s College of Biological Sciences and College of Food, Agricultural and Natural Resource Sciences, a resident fellow in the Institute on the Environment and serves as the Curator of Plants at the Bell Museum of Natural History.