October 31, 2018 Deadline for Caregivers and The Changing Marihuana Dynamic in Michigan

Caregivers and the DoDo

Marijuana and extinct birds would seemingly never show up in any kind of discussion. Nevertheless, in speaking with our marijuana clients, much of them are inquiring about the viability of the Caregiver model, particularly as it was promoted several years. What several in the sector have referred to as the "Caregiver Model" is going the way of the Do-Do bird on October 31, 2018. Halloween this year will be the extinction event for the caregiver model as many have actually recognized it for several years here in Michigan. While Caregivers will continue to have the ability to grow and offer to their registered patients, and for themselves, if they are likewise registered qualifying patients, the "gray market" where they were selling their excess, and making a pretty good revenue, is coming to an end.

What was the "Caregiver Model?"

Under the old "Caregiver Model," a Registered Caregiver can grow up to seventy-two (72) marihuana plants, if they had 5 registered qualifying patients (the most you were enabled) and they were a registered patient too. Sometimes, numerous caregivers would gather at one area and grow their plants with each other, separated by paint lines on the floor, or in more sophisticated circumstances, with each having a protected locked area within the larger confined, locked facility. Lots of Caregivers can produce much more functional marihuana than their patients could utilize. Those caregivers would then sell their overages to dispensaries, many of which were running with municipal approval across the State. This "grey" industry caused substantial revenues for many caregivers and dispensary owners. Under Michigan's Medical Marihuana Facilities Licensing Act, nevertheless, caregivers were going to be terminated by 2021. Lots of Caregivers and industry insiders felt that meant the "Caregiver Model" could remain to create those exact same earnings for another two or 2 and a half years. The State, nonetheless, had other plans.

The State's Response

The State of Michigan, nevertheless, had other plans for the upstart cannabis market. Initially, the Bureau of Licensing and Regulatory Affairs has actually taken a really scrutinizing technique to licensing applications where any of the candidates were Caregivers. A lot of those applications have been rejected over the past several months since the Board has located that there were failings to reveal by a lot of these caregivers relating to just how much money they made, just how they made it, and for failing to proclaim that income on a State or Federal Tax Return. However, in a September 2018 posting, LARA and the BMMR published that all facilities that are operating with municipal approval, but which have actually not gotten a State License, should stop getting unlabeled and unsanctioned medical marihuana on October 31, 2018. https://www.michigan.gov/lara/0,4601,7-154-79571_79784-479748–,00.html. Any kind of marihuana purchased after the October 31, 2018 date by those facilities should be appropriately labeled and coded as required by the guidelines, and must originate from an appropriately State Licensed grower or processor. The caregivers might still grow, but they will certainly have no methods by which to sell their product legally to a provisioning center or processor. The old "Caregiver Model" will, effectively, come to an end.

Outcomes and Repercussions

Some may argue that there are still licensed or unlicensed facilities that are mosting likely to proceed buying from caregivers, despite the State mandate. To be sure, there might be some that take that risk.

However, the State has demonstrated a commitment to enforcement and evaluation. If the State were to identify that an applicant or a licensed facility was still taking caretaker excess and selling them, the State would likely take action. If a candidate were to be caught taking part in this model, they would likely be denied as soon as possible by the Board. If a licensed center were to be caught violating this mandate, the State would likely move on with sanctions against that center's license, including a suspension or revocation of the license. Provided just how much those licenses are worth, and the expense of getting any of the permitted center licensing types, a lot of owners will certainly be extremely resistant to take chances with the possible loss of their license, or understanding that their license will not be renewed.

If you are a caregiver and do not understand what to do come October 31, 2018, are an individual thinking of making an application for a MMFLA license, or are an applicant that needs representation or has concerns regarding exactly how these changes will affect you, give us a call. We have the experience and expertise in the cannabis and marihuana legislation areas to help answer your concerns and provide you the assistance you require.

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