Caregivers and the DoDo
Marijuana and extinct birds would seemingly never ever come up in any kind of discussion. Nevertheless, in consulting with our marijuana clients, many of them are inquiring about the viability of the Caregiver model, specifically as it was pushed for years. What many in the market have actually referred to as the "Caregiver Model" is going the way of the Do-Do bird on October 31, 2018. Halloween this year will certainly be the extinction event for the caregiver model as many have actually understood it for many years here in Michigan. While Caregivers will continue to have the ability to grow and market 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 might grow up to seventy-two (72) marihuana plants, if they had five registered qualifying patients (the most you were permitted) and they were a registered patient too. In many cases, several caregivers would collect at one area and grow their crops together, separated by paint lines on the flooring, or in more sophisticated conditions, with each having a protected locked room within the larger enclosed, locked center. Numerous Caregivers might produce even more useful marihuana than their patients could make use of. Those caregivers would after that sell their excess to dispensaries, many of which were operating with municipal approval throughout the State. This "grey" market led to substantial revenues for many caregivers and dispensary owners. Under Michigan's Medical Marihuana Facilities Licensing Act, however, caregivers were mosting likely to be phased out by 2021. Several Caregivers and industry experts really felt that suggested the "Caregiver Model" might remain to generate those very same earnings for an additional 2 or 2 and a half years. The State, nonetheless, had other plans.
The State's Response
The State of Michigan, nonetheless, had other plans for the upstart marijuana industry. First, the Bureau of Licensing and Regulatory Affairs has taken a very scrutinizing method to licensing applications where any of the candidates were Caregivers. Much of those applications have been rejected over the past several months since the Board has found that there were failings to divulge by many of these caregivers regarding how much cash they made, exactly how they made it, and for failing to state that earnings on a State or Federal Tax Return. However, in a September 2018 publishing, LARA and the BMMR posted that all centers that are operating with municipal approval, but which have not gotten a State License, need to stop purchasing unlabeled and unsanctioned medical marihuana on October 31, 2018. https://www.michigan.gov/lara/0,4601,7-154-79571_79784-479748–,00.html. Any marihuana acquired after the October 31, 2018 date by those facilities should be properly identified and coded as required by the guidelines, and must come from a properly State Licensed grower or processor. The caregivers may still grow, but they will have no methods whereby to sell their product legitimately to a provisioning center or processor. The old "Caregiver Model" will, effectively, come to an end.
Results and Consequences
Some may say that there are still licensed or unlicensed centers that are going to continue buying from caregivers, regardless of the State mandate. To ensure, there may be some that take that risk.
Nonetheless, the State has actually shown a commitment to enforcement and examination. If the State were to determine that a candidate or a licensed facility was still taking caretaker overages and selling them, the State would likely do something about it. If a candidate were to be caught participating in this model, they would likely be refuted immediately by the Board. If a licensed center were to be caught breaking this mandate, the State would likely move on with sanctions against that facility's license, consisting of a suspension or revocation of the license. Given just how much those licenses are worth, and the expense of acquiring any one of the permitted center licensing types, a lot of owners will be extremely reluctant to take chances with the possible loss of their license, or understanding that their license will not be restored.
If you are a caregiver and do not understand what to do come October 31, 2018, are an individual thinking about requesting a MMFLA license, or are an applicant who needs representation or has concerns regarding exactly how these adjustments will affect you, give us a call. We have the experience and expertise in the cannabis and marihuana regulation fields to assist answer your inquiries and offer you the advice you need.
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