Caregivers and the DoDo
Cannabis and extinct birds would seemingly never come up in any type of conversation. However, in talking to our cannabis clients, most of them are asking about the stability of the Caregiver model, specifically as it was promoted years. What several in the market have described 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 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 marketing their excess, and making a fairly good revenue, is coming to an end.
What was the “Caregiver Model?”
Under the old “Caregiver Model,” a Registered Caregiver could grow up to seventy-two (72) marihuana plants, if they had five registered qualifying patients (the most you were enabled) and they were a registered patient as well. Sometimes, numerous caregivers would collect at one place and grow their crops with each other, divided by paint lines on the floor, or in more innovative situations, with each having a safeguarded locked room within the larger enclosed, secured facility. Lots of Caregivers might create far more functional marihuana than their patients can use. Those caregivers would certainly after that offer their overages to dispensaries, many of which were running with municipal approval throughout the State. This “gray” marketplace caused substantial profits for several caregivers and dispensary owners. Under Michigan’s Medical Marihuana Facilities Licensing Act, however, caregivers were going to be eliminated by 2021. Lots of Caregivers and industry experts really felt that implied the “Caregiver Model” can continue to create those very same earnings for another two or two and a half years. The State, nonetheless, had other plans.
The State’s Response
The State of Michigan, however, had other plans for the upstart cannabis sector. First, the Bureau of Licensing and Regulatory Affairs has actually taken a really scrutinizing method to licensing applications where any one of the candidates were Caregivers. Much of those applications have been refuted over the past several months since the Board has discovered that there were failings to divulge by a number of these caregivers relating to how much cash they made, exactly how they made it, and for failure to declare that earnings on a State or Federal Tax Return. However, in a September 2018 posting, LARA and the BMMR posted that all centers that are running with municipal approval, but which have actually not received a State License, should stop purchasing unlabeled and unauthorized medical marihuana on October 31, 2018. https://www.michigan.gov/lara/0,4601,7-154-79571_79784-479748–,00.html. Any kind of marihuana acquired after the October 31, 2018 date by those centers must be properly identified and coded as required by the rules, and must originate from a properly State Licensed grower or processor. The caregivers may still grow, however they will have no methods whereby to sell their product legally to a provisioning center or processor. The old “Caregiver Model” will, effectively, come to an end.
Results and Consequences
Some may argue that there are still licensed or unlicensed centers that are going to proceed buying from caregivers, in spite of the State mandate. To make sure, there may be some that take that threat.
Nevertheless, the State has demonstrated a commitment to enforcement and evaluation. If the State were to identify that a candidate or a licensed center was still taking caretaker overages and offering them, the State would likely act. If a candidate were to be caught engaging in this model, they would likely be denied asap by the Board. If a licensed center were to be caught breaching this mandate, the State would likely move on with sanctions against that facility’s license, including a suspension or retraction of the license. Offered how much those licenses are worth, and the expense of acquiring any one of the allowed center licensing types, a lot of owners will certainly be really unwilling to take chances with the possible loss of their license, or expertise that their license will not be restored.
If you are a caregiver and do not understand what to do come October 31, 2018, are a person considering making an application for a MMFLA license, or are a candidate that requires representation or has concerns regarding just how these changes will affect you, give us a call. We have the experience and expertise in the marijuana and marihuana regulation fields to assist address your inquiries and supply you the advice you require.