The Bureau of Medical Marijuana Regulation is standing firm on their stance that all marijuana facilities that are not licensed by the State under the Medical Marihuana Facilities Licensing Act, will have to shut down, and will receive a cease and desist letter at that time. While the facilities are not mandated to shut down, the State Bureau of Licensing and Regulatory Affairs has made clear that any facility that continues to operate after receipt of the cease and desist will very likely not be granted a license. Further, the State has set forth proposed Final Rules regarding Medical Marihuana Facilities licensing, which is going to allow or registered qualifying patients to receive home deliveries from provisioning centers (with restriction, of course) and will also permit online ordering. So, where does that leave registered caregivers, who were expecting to be able to remain relevant to their patients until 2021?
The old model for registered caregivers was pretty simple. You were allowed to grow up to twelve plants for each patient. You could have five patients, other than yourself. If the caregiver was also a patient, they could also grow twelve plants for personal use as well. So, a caregiver could grow a total of seventy-two marihuana plants. Most caregivers produced far more usable marihuana from those plants than they could use for patients and personal use. The caregivers would then sell their excess product to medical marihuana dispensaries.
Under the emergency rules, marihuana dispensaries that were operating with municipal approval, but that had not received a State license were permitted to continue operating and buying from registered caregivers. Those facilities were permitted to buy caregiver overages for thirty days after receiving their State license for stock. That meant significant profits for caregivers and substantial supply for dispensaries.
After September 15, 2018
The problems for registered caregivers only begins on September 15, 2018. All State licensed facilities that will remain open and operating cannot buy any product from caregivers. State Licensed Provisioning Centers, but statute and administrative rules are strictly prohibited from buying or selling any product that is not produced by a State Licensed Grower or Processor that has had their product tested and certified by a State Licensed Safety Compliance Facility. Any State Licensed Provisioning Center that is discovered to have product for sale that is not from a State Licensed Grower or Processor is subject to State sanctions on their license, including temporary or permanent revocation of the license. Given the risk, licensed facilities are very unlikely to risk buying from a caregiver, given the potential consequences.
Further, the unlicensed facilities to whom caregivers have been continuing to sell to, even during the licensing process, will be shutting down. Some may continue to operate, but given the State’s stance on facilities that do not comply with their cease and desist letters being looked at very unfavorably in the licensing process, the market will be severely diminished, if not eliminated. As a result, caregivers will not have much recourse for selling their overages, and will be limited only to their current patients.
New Administrative Rules
A hearing will be held on September 17, 2018 regarding the new proposed final administrative rules for the regulation of medical marihuana facilities, which will become effective in November, when the emergency rules cease being effective. Those final proposed administrative rules allow for home delivery by a provisioning center, and will also permit regulated online ordering. Those two things take away much of the role contemplated by caregivers under the new rules. Patients would still need them to go to the provisioning center to pick up and deliver cannabis to patients that were too sick or who were disabled and could not get to those licensed facilities to obtain their medical cannabis. With this change to the administrative rules, such patients will no longer need a caregiver. They will be able to place an order online and have the provisioning center deliver it to them, essentially eliminating the necessity of a caregiver.
For better or worse, the State is doing everything it can to eliminate caregivers under the new administrative scheme, even prior to the planned elimination in 2021 contemplated by the MMFLA. There are a lot of reasons the State could be doing it, but that is of little comfort to caregivers. The bottom line is, the State is doing away with the caregiver model, and they are moving that process along with celerity. The State is sending the message that they want caregivers out of the marketplace as soon as possible, and they are establishing rules to ensure that happens sooner rather than later. The caregiver model, while beneficial and necessary under the old Michigan Medical Marihuana Act structure, are now going the way of the Dodo. Like everything else, the Marihuana laws are evolving, and some things that have thrived in the past, won’t make it to see the new legalized era.