280E repeal possible as part of GOP tax package

280E repeal possible as part of GOP tax package

The Republican tax reform bill currently being debated in the U.S. Senate may end up including a repeal of 280E for state-licensed marijuana companies if a last-minute bipartisan amendment makes it into the legislation.

The amendment – offered by Republican U.S. Sen. Cory Gardner of Colorado – would essentially exempt cannabis companies from 280E as long as they’re in full compliance with state laws.

It’s a version of the Small Business Tax Equity Act, which was originally sponsored in the House by Florida Republican Carlos Curbelo and in the Senate by Oregon Democrat Ron Wyden.

The 280E provision of the federal tax code has long been the financial bane of marijuana companies that have been trying to play by the rules while also turning a profit.

The provision prevents MJ companies from taking standard federal tax deductions that are allowed for every other legal industry, so cannabis businesses typically end up paying a 70%-90% federal tax rate.

A number of pro-marijuana industry groups were hard at work Thursday lobbying senators to support the amendment, as the upper chamber went into what will likely be the final days of debate on the tax bill before a final vote.

“To help this amendment succeed, senators need to hear from you!” the National Cannabis Industry Association (NCIA) wrote in an email blast to its members.

Neal Levine, chairman of the marijuana industry organization the New Federalism Fund – which has been working almost exclusively on a 280E repeal for the MJ industry – said the amendment “has a real chance to pass,” in large part because of bipartisan support from members of Congress.

By contrast, NCIA’s director of government relations, Michael Correia, said he was “hopeful” about the amendment’s chance and said it would be a heavy lift politically to get enough votes.

“It’ll be a challenge to see if we can get 51 senators to support this,” Correia said.

Americans for Tax Reform, headed by the conservative anti-tax crusader Grover Norquist, is also throwing its support behind Gardner’s amendment and is lobbying senators to back the measure, sources told Marijuana Business Daily.

Kent County woman who ran marijuana dispensary charged with several felonies

Kent County woman who ran marijuana dispensary charged with several felonies

There are 3 related articles from Dec 2016  /  Oct 2017  /  Dec 2017

DEC 2016

Woman who ran marijuana dispensary charged with several felonies, including racketeering

John Hogan, WZZM 11:39 PM. EST December 15, 2016

PLAINFIELD TOWNSHIP, MICH. – A Comstock Park woman police say ran an illegal medical marijuana dispensary is facing several felony charges stemming from a late November raid at the Plainfield Township facility.

Charges against 51-year-old Susan M. Bond include conducting a criminal enterprise and criminal enterprises – racketeering proceeds; both are 20-year felonies. Police seized several pounds of marijuana during a Nov. 28 raid at The Provision Center, which also was known as Michigan Relief Hub, according to court records.

Bond told investigators the business generated about $1,000 a day, Kent County Sheriff’s Lt. Al Roetman said.

“She has been running a criminal enterprise in our opinion,’’ Roetman said. “The ones that have been running are not legal.’’

The business, located on Plainfield Avenue north of Five Mile Road NE, was among seven locations visited by the Kent Area Narcotics Enforcement Team on Nov. 28. As of now, Bond is the only person to be charged. A state police drug enforcement task force raided the business in Nov. 2015, Roetman said.

Criminal charges were appropriate because Bond received prior warning that the dispensary was operating illegally, Kent County Assistant Prosecutor Gregory Boer said.

“We did send her a letter quite a while ago indicating that she was operating outside the law and we asked her to stop doing it,’’ Boer said. “We do this in a progression and this was handled no differently.’’

In addition to racketeering and conducting a criminal enterprise, Bond faces two counts of delivery/manufacture of marijuana, a four-year felony, and maintaining a drug house, which carries a two-year term.

Bond on Wednesday waived a probable cause hearing in 63rd District Court, sending the case to Kent County Circuit Court for trial. She is free on a $50,000 bond.

Police also raided a building on Taylor Avenue near Leonard Street NW linked to Bond. Deputies found business records and proceeds linked to the Plainfield Township dispensary, court records show.

A man interviewed by detectives said he moved records and proceeds to the Grand Rapids location “in an attempt to hide his and Susan Bond’s connection to the business,’’ according to a probable cause affidavit in 63rd District Court. The man, who has not been charged, said Bond owned the business and he served as manager.

To build their criminal case against Bond, detectives conducted several controlled buys of marijuana at the business.  A detective from the Kent Area Narcotics Enforcement Team was in the store during one of the buys; Bond was also there, court records show.

Bond may have inadvertently helped investigators build their case against her. She attempted to file an embezzlement complaint with the Kent County Sheriff’s Department against a former manager “stating that the former manager stole medical marijuana from the Provision Center,’’ court records show. She also said that she takes 20 percent of the proceeds from the sale of marijuana “for her paralegal services at the Provision Center,’’ court records show.

Gov. Rick Snyder in September signed legislation that will allow medical marijuana dispensaries beginning next year so long as local ordinances allow them to operate.

As the law now stands, they’re still illegal, Boer said.

“You have to be a licensed caregiver, you can only have five people that you are a caregiver for,’’ he said. “These dispensaries think they can be a caregiver to anyone and that’s just not the case.’’

 

OCT 2017

Marijuana dispensary operator convicted of racketeering, faces two decades in prison

GRAND RAPIDS, MICH. (WZZM) – A woman accused of running an illegal medical marijuana dispensary north of Grand Rapids was convicted Thursday of numerous felony charges that could put her in prison for up to 20 years.

Kent County jurors found 52-year-old Susan M. Bond guilty of five charges, including conducting a criminal enterprise and racketeering, for a business shuttered last year on Plainfield Avenue near Five Mile Road NE.

The jury began deliberations Wednesday afternoon. They reached a verdict mid-afternoon Thursday.

Kent County Circuit Court Judge Joseph Rossi, who presided over the two-week trial, ordered she be held on a $100,000 bond pending her sentencing date in mid-November.

Kent County Assistant Prosecutor Gregory Boer said Bond headed a multi-million-dollar marijuana business in Kent County’s Plainfield Township. The Provision Center was among seven locations visited by the Kent Area Narcotics Enforcement Team on Nov. 28.

Defense attorney Michael Komorn said Bond did nothing illegal. The investigation was launched after Bond called police to report embezzlement from her business, he told jurors.

“And they flip it around and make it a mobster crime,’’ Komorn said in opening statements last week. “At no point are you going to hear that my client delivered marijuana to anybody.’’

Members of the Kent Area Narcotics Enforcement Team launched the probe in the summer of 2016. Between Aug. 1 and Oct. 14, 2016, the business took in more than $647,000; Bond pocketed about $137,000, Boer said.

Bond used proceeds to pay rent and salaries and invest in supplies, Boer told jurors.

She was found guilty of racketeering and conducting a criminal enterprise – felonies punishable by up to 20 years in prison. Jurors also convicted Bond of two counts of delivery/manufacture of marijuana, a four-year felony, and maintaining a drug house, which carries a two-year term.

 

DEC 2017

WOMAN WHO RAN MARIJUANA DISPENSARY GETS JAIL, $25,000 FINE FOR RACKETEERING

Author:John Hogan

Published:7:00 PM EST December 6, 2017

A woman convicted of running an illegal medical marijuana dispensary north of Grand Rapids was sentenced Wednesday to a year in jail and placed on probation for three years.

A woman convicted of running an illegal medical marijuana dispensary north of Grand Rapids was sentenced Wednesday to a year in jail and placed on probation for three years.

A Kent County jury in October found Susan Maria Bond guilty of racketeering and conducting a criminal enterprise for a marijuana dispensary authorities say raked in millions of dollars.

In addition to jail and probation, Kent County Circuit Court Judge Joseph Rossi slapped her with a $25,000 fine. The judge also ordered that Bond perform 50 hours of community service.

Bond, 52, was facing up to 20 years in prison for racketeering and conducting a criminal enterprise. Terms of her sentence allows for possible early release from jail.

Kent County jurors found the 52-year-old paralegal guilty of five charges for a business shuttered last year on Plainfield Avenue near Five Mile Road NE. Her trial lasted two weeks.

Kent County Assistant Prosecutor Gregory Boer said Bond headed the multi-million-dollar marijuana business in Kent County’s Plainfield Township. The Provision Center was among seven locations visited by the Kent Area Narcotics Enforcement Team in November, 2016.

Defense attorney Michael Komorn said Bond did nothing illegal. The investigation was launched after Bond called police to report embezzlement from her business, he said.

Members of the Kent Area Narcotics Enforcement Team launched the probe in the summer of 2016. Between Aug. 1 and Oct. 14, 2016, the business took in more than $647,000; Bond pocketed about $137,000, Boer said.

Bond used proceeds to pay rent and salaries and invest in supplies, Boer said.

In addition to racketeering and conducting a criminal enterprise, jurors convicted Bond of two counts of delivery/manufacture of marijuana, a four-year felony, and maintaining a drug house, which carries a two-year term.

 

Medical marijuana enforcement hazy as state forms rules

Lansing— The road to the Michigan Capitol is lined with marijuana.

It’s almost impossible to drive to the capital dome without seeing scores of shop signs emblazoned with bright green medical crosses and plucky names — BudzRUs, TruReleaf, Best Buds, Kind Provisioning Center — all along Michigan Avenue and the city at large. A constant stream of people filter in and out of the pot shops.

In major cities such as Ann Arbor, Ypsilanti, Lansing and Flint, medical marijuana dispensaries are largely left alone.

In other areas, however, police follow federal and state law, in effect treating medical marijuana as an illegal narcotic and a public safety issue. Regional state police drug teams have raided and closed dispensaries with the help of county prosecutors across the state, including in Grand Traverse, Kent, Oscoda, Otsego, St. Clair and Wexford counties.

This unequal treatment occurs as Michigan implements new regulations on everything the industry does, from growing to transporting to selling. On Dec. 15, those trying to get into or stay in business can submit applications for an official state license.

It has been unclear since voters approved a 2008 referendum allowing marijuana for medical use what the state’s law actually permitted. In 2013, the Michigan Supreme Court decided that dispensaries are illegal.

But the ruling has left some communities without local access to medical pot while others have a glut. Still others face legal fees and prison.

“I’ve shed tears over this. This has never been about money for me,” said Chad Morrow, a 39-year-old Gaylord resident and former dispensary owner facing up to seven years in prison. “To have that taken away — it’s disheartening and heartbreaking, honestly.”

Although Morrow obtained permission from the Gaylord Planning Commission and the City Council to open a dispensary called Cloud 45, it was raided multiple times by a regional state police drug unit before he closed it in 2016 pending criminal charges.

Mixed messages from the state also helped inspire at least one medical marijuana crackdown in Grand Traverse County, the most recent county-wide enforcement action against dispensaries operating for years. Police sometimes conduct raids even if the prosecutor doesn’t play ball, said lawyers specializing in marijuana cases.

“I think Traverse City had the largest concentration of places north of Lansing, so it was the biggest target,” said Matt Abel, a criminal defense attorney in Detroit and an expert on marijuana cases. “Why they’re doing it now when these places have existed for years? It (makes us think) it has something to do with the upcoming licensing.

“They see this as an opportunity to clear the playing field and the patients be damned.”

Eight dispensaries closed

The prosecutor in Grand Traverse County helped close all eight of the county’s dispensaries in October after state regulators said staying open past the Dec. 15 application opening would hurt such shops’ chances of getting a license to do business legally.

In November, the Department of Licensing and Regulatory Affairs changed course and issued an emergency rule telling pot shops that staying open past mid-December wouldn’t hurt their licensing chances. But Grand Traverse County prosecutor Robert Cooney already had issued cease-and-desist letters to the four medical marijuana shops in Traverse City and four others around the county.

Capt. Michael Caldwell, State Police commander for the region, said a regional state police drug unit called Traverse Narcotics Team, or TNT, acted “because dispensaries are illegal.”

Caldwell would not say why the probe began in September when the dispensaries were open for business for years beforehand.

“No, I can’t comment on any specifics of those investigations,” he said. “Once these owners obtain legal license to operate a dispensary, then they have nothing to fear. However, until that happens, they’re in violation of the Michigan Medical Marihuana Act, and they’re subject to enforcement action.”

Cooney said his cease-and-desist letters were in part prodded by comments from state Michigan Medical Marihuana Licensing Board member Donald Bailey, a retired state police sergeant from Traverse City who worked in drug enforcement. At an August meeting, Bailey said he wanted to close all dispensaries before licenses were issued to be in line with the Supreme Court ruling.

Bailey’s motion was met with sustained public outcry before LARA told the board at a later meeting that it does not have the authority to shut down dispensaries.

But Bailey’s comments and LARA’s prior warning that provisioning centers could sabotage their licensing chances by staying open past the mid-December application deadline led Cooney to believe the state wanted them shuttered.

“To me, (that) indicated that the state really wants these illegally operating business shut down before the new law,” he said, indicating he thought the state and localities wanted to collect taxes and licensing fees from legal businesses under new state rules.

Cooney informed the dispensaries in his letters that state law does not allow them to sell medical marijuana. The law allows a “caregiver” to cultivate and grow medical marijuana for up to five patients.

First Lt. Josh Lator, a state police commander at the Houghton Lake Post in northern Michigan, said police have been monitoring the Grand Traverse dispensaries for some time, and “the biggest reason” they acted now was “because every one of the places that the team contacted … were operating in violation of Michigan law.”

Licensed ‘caregivers’ lacking

Although dispensaries are currently illegal, many patients have argued that finding medical pot would be difficult if all the shops closed.

Michigan lacks enough licensed “caregivers” to provide for all of its patients. There are 272,215 patients and 43,266 caregivers in Michigan — or more than six patients for every caregiver. Caregivers can only grow medical marijuana for up to five patients each.

State police spokeswoman Shanon Banner said the department keeps no statistics on its medical marijuana dispensary raids, and that enforcement occurs on a “case-by-case” basis. She declined to say why some state police units crack down on dispensaries while others don’t.

“Sometimes enforcement is the result of local ordinance; sometimes it’s related to other criminal activity,” Banner said in an email.

But dispensaries across the state sell marijuana to more than five patients without legal repercussion.

“The county prosecutors let them do it,” said Barton Morris, a Royal Oak criminal defense attorney specializing in marijuana cases.

Pro-marijuana lawyers like Abel and Morris say the patchwork of enforcement happens in the absence of centralized state police orders. They say ambitious local narcotics units such as TNT work to find county prosecutors who are willing to cooperate.

By contrast, Washtenaw County prosecutor Brian Mackie said he deals with much more pressing issues. Local police and county prosecutors are just “inundated with domestic violence, murder, rape, armed robbery,” he said.

“Marijuana is not a No. 1 priority in the county,” said Mackie, who indicated he does not favor legalizing recreational use of marijuana. “We evaluate cases that come to us. We don’t get a great many of them.”

Registered business targeted

In 2016, 12 dispensaries in Oscoda and Otsego counties were raided by regional state police narcotics task forces.

In August of that year, the owners and workers of a dispensary called Northern Michigan Caregivers in Lewiston turned themselves into police following warrants issued for their arrest on charges that stemmed from running the dispensary.

Delbert Curio, 59, ran the shop with his wife, Brandi, for nearly four years before a judge issued a search warrant following two “controlled buys” to prove the dispensary actually sells medical marijuana.

Curio even took pains to register his business with the Oscoda County Clerk, according to a state police incident report.

“Delbert and Brandi (Curio) operated the business very openly and obviously with the belief that their transactions and activities would be protected by the Michigan Medical Marijuana (sic) Act,” defense lawyer Morris wrote in a 2016 sentencing memo.

The Straits Area Narcotics Unit still seized about $2,700 in cash and all of the shop’s marijuana and marijuana derivatives, such as liquid THC and edibles. The county prosecutor initially threatened Curio with up to 50 years in prison for delivering and manufacturing marijuana, operating or maintaining a laboratory and maintaining a drug house, according to a court document.

Instead, Delbert ended up getting four years of probation and permission from a local judge to use medical marijuana to treat his advanced lung cancer.

It’s incomprehensible that state police are still busting people as other state officials attempt to work out the regulatory details that will lay the groundwork for huge profits in the marijuana industry, said Michael Komorn, a Farmington Hills-based criminal defense lawyer specializing in marijuana cases.

“It can’t be reconciled with any kind of logic,” Komorn said.

Michael Gerstein, The Detroit News Published 12:04 a.m. ET Nov. 20, 2017

Article Link

Michigan’s war on pot

Michigan’s war on pot

I was at a meeting of the Detroit City Planning Commission when a proposed dispensary law was being discussed. One commissioner, clearly an opponent of marijuana stores, asked, “If we pass this, can we start closing these places tomorrow?”

Donald Bailey, a member of the Medical Marihuana Licensing Board that is tasked with setting up the rules for a marijuana distribution system by mid-December, did the same thing at the board’s Aug. 21 meeting. Bailey opened the meeting with a proposal to tell all dispensaries whose owners want to be considered for a state license that they have to shut down by mid-September.

Luckily, others on the five-member board decided to hear testimony from the 200 or so people at the meeting. After four hours of testimony, the four MMLB members in attendance decided to seek information from the state licensing board and the attorney general’s office before making a decision.

Bailey is a retired state police sergeant who apparently still carries a banner for the war on drugs. That’s his right, and I guess his proposal should come as no surprise. However, it’s a shame that people with that attitude — at city and state levels — are those tasked with setting up the system for patients to access marijuana. To start with, I’m pretty sure they don’t believe that marijuana is medicine, because they appear to have no concern for patients here.

If all of the dispensaries shut down in September, are the epileptics just supposed to have seizures all the time until the new system opens up in mid-December? That seems to have been the attitude of legislators and law enforcement in Michigan since the medical marijuana law passed nine years ago. They basically said, “Well, the law says you can have this stuff, but it doesn’t say you can have stores to supply it.”

Then, instead of fixing that, they demurred, hemmed, hawed, blocked, arrested, ruined lives, and tried everything possible to take down legal patients, including reportedly pressuring the state crime lab to classify extracts in a manner that allowed prosecutions. (Thank you attorney Michael Komorn for exposing that.)

In the face of a medical marijuana law created by a vote of the people, the state amended the war on drugs to include a war on patients.

Another reason I think that much of our government leadership doesn’t believe marijuana is medicine is that in all of the legislating that has been done, there has been nothing calling for medical qualifications or standards — or anything else regarding the medical side of this. (Americans for Safe Access has a Cannabis Care Certification program you can learn about at CannabisCareCertification.org.)

So far, the laws that have been passed set up a system that’s more about law enforcement and who gets paid. We haven’t yet seen what the MMLB will come up with, but we know there are going to be licenses that will have to be paid for by growers, processors, transporters, and retail sales at the state and local level. Then the state gets tax revenue too, although I don’t begrudge that.

The city of Warren charges $2,500 to dispensary applicants just to process the application. In Detroit, a Caregiver Center license costs $1,470.70. However, there’s a $160 site plan review fee, $1,000 for a conditional hearing, and $2,276 for an annual Detroit Health Department inspection, in addition to a few other charges.

Money is the main incentive the state has to put its system together — not compassion for patients, not the will of the people, not doing the right thing. So it should be no surprise that this is the system that’s coming down the pike.

There are plenty of activists who want to make money somewhere in this system. And the vast majority of the people who have started dispensaries want to turn a profit. They got into the business early in order to already be there when the state came around. A lot of them got busted, incurred huge legal fees, and some went to jail. Who knows — they may be penalized for it in the long run.

I don’t think they should be penalized, but even more so I don’t think patients should be penalized — which is going to be the end result if retail outlets have to shut down.

This whole shutdown suggestion has me wondering if there are other — preferred — vendors they want to make room for. MMLB Chair Rick Johnson (a former Republican state speaker of the House) was praised by the Michigan Responsibility Council when he was appointed by Gov. Rick Snyder back in May. But the MRC was the front for a group of investors who, a few years back, were trying to get a system of legal marijuana in which they controlled all production and sales. Now, the MRC opposes the 2018 ballot effort to “regulate marijuana like alcohol” because it’s the “wrong” kind of system.

Hmm. I wonder if the “right” kind of system is one where they control everything?

There does need to be a system for marijuana regulation. The state has dragged its feet for far too long, and the lack of a clear vision in Lansing has left the system vulnerable to ideologues like Bailey and profiteers like Johnson. And nobody seems to be particularly concerned about the patients.

Looks like we’re going to get something that mimics the for-profit medical care system we already have in place.

Closure has already hit the Reef, a caregiver center on Eight Mile Road that shut down on Sunday because owners anticipated having to apply for state certification. In a press release sent last week, the Reef announced that “all indications are that the Board will eventually vote in favor of closing all dispensaries in Michigan until each one is licensed through the State.”

The Reef is already certified to operate in Detroit, a spokesperson told me, saying, “We don’t know what the board is going to do. We don’t know what authority they have to do any of this. But we’re doing everything in anticipation. We did the same thing with the city of Detroit. We also complied to the terms the city set out.”

Regarding patients, the spokesperson said: “Our plan is to reopen with state licensing. We’re hoping that they can find their medicine elsewhere. … This is a temporary situation to make sure we’re there for the long haul.”

I guess we could see a lot of this across the state.

Despite all that, folks who wish to pursue their dream of starting a marijuana-related business may want to check out the marijuana business seminar scheduled for Friday, Sept. 22 at Cobo Center. Sponsored by the Royal Oak-based Cannabis Legal Group, the seminar will focus on licensing, testing, and business operations.

Medical marijuana caregiver sues in federal court after police raid his home

Medical marijuana caregiver sues in federal court after police raid his home

GRAND RAPIDS — A medical marijuana caregiver has filed a federal lawsuit after police raided his St. Joseph County home last year.

Police arrested Sean Muntian and his wife, April Armstrong, after raids at their Three Rivers home and business, Triple Ripple Hydroponics. Police seized marijuana and grow equipment, and prompted an investigation by Child Protective Services workers.

Not long after the Jan. 2, 2010 arrests, prosecutors dropped charges, said Southfield attorney Michael Komorn, who specializes in medical-marijuana cases and represented Muntian in the criminal case. He said Monday that police had no interest in Muntian’s status as a medical marijuana caregiver.

In the lawsuit, recently filed in U.S. District Court in Grand Rapids, an attorney for Muntian and Armstrong wrote: “Despite unequivocal rights granted to Mr. Muntian as a licensed caregiver under Michigan law, (police) refused to allow Mr. Muntian to show them proof of his license and the defendants proceeded to seized medicine and equipment in direct violation of the statute.”

Troy attorney Travis Mihelick also alleged the search of their rental home was illegal. The couple’s landlord had reported to police that she detected the odor of burned marijuana in the residence. Using that information, police obtained a search warrant and arrested the couple, the lawsuit said.

Mihelick alleged that police used “extreme force and the threat of deadly force on suspects who were not resisting.”

Both were taken to jail, the attorney said.

“As a result of the illegal search and seizure, Mr. Muntian was forced to close his medical marijuana store and several of his patients were denied access to their prescription medicine.”

The police agencies have not been served with the lawsuit. Three Rivers Police would not comment, while a message left with the St. Joseph County undersheriff was not returned.

The lawsuit alleges unlawful arrest and imprisonment, malicious prosecution, excessive force and illegal search and seizure.

Komorn, the criminal attorney and a board member of the Michigan Medical Marijuana Association, said similar cases have occurred across the state.

He said police should have left Muntian alone after determining he was properly licensed. Instead, he was charged with manufacturing marijuana, possession with intent to deliver and maintaining a drug house.

When arrested, Muntian had state approval as a caregiver but had not received his identification card. Applicants may possess and provide marijuana 20 days after approval, whether or not they have received the card.

Police found about 6 ounces of marijuana in his home, and four large plants and 18 small plants, along with growing supplies, at his shop.

Caregivers are limited to 2.5 ounces of marijuana and 12 plants per patient. Once charges were dropped, Komorn said, Muntian was allowed to retrieve his equipment from the police station. He said the raid, with children in the home, was traumatic.

“Those kinds of images are very hard to shake,” Komorn said.

The investigation by protective services workers only made it worse. Investigators found “no issues there,” he said.

“Medical marijuana patients and caregivers are not bad parents,” he said.

E-mail John Agar: jagar@grpress.com