Tea Party Stages debate on Arizona Marijuana Legalization

Eastern Arizona Courier:  “Medical marijuana dispensary owner J.P. Holyoak debated Pinal County Attorney Lando Voyles over legalizing marijuana for recreational use at an event at Victory Theater, sponsored by the Graham County Tea Party and Graham County Republican Women Club, on Feb. 19.  Holyoak called himself an “unapologetic conservative Republican” who also happens to be the chairman of the Marijuana Policy Project-sponsored initiative to regulate marijuana like alcohol. Holyoak was previously against marijuana but, after seeing how the plant improved the quality of life for his ill daughter, Reese, he thrust himself into its advocacy.

By |2016-03-01T19:37:50-07:00February 29th, 2016|AZ Legislation, Stories & Articles|Comments Off on Tea Party Stages debate on Arizona Marijuana Legalization

Arizona House Bill 2410 Would Require Dispensaries to Grow Inside

Arizona House Bill 2410 sponsored by Republicans Vince Leach, Bob Thorpe, Mark Finchem, Anthony Kern and David Livingston would require that all medical marijuana grown by Arizona medical marijuana dispensaries be grown inside enclosed facilities.  The propose law would modify Arizona Revised Statutes Section 36-2801.6 as follows:

“Enclosed, locked facility” means a closet, room, greenhouse or other enclosed, roofed area that has a hardened covering and that is equipped with locks or other security devices that permit access only by a cardholder.”

The proposed change in the statute is indicated above in text that is bold and red.

By |2016-02-28T11:03:52-07:00February 28th, 2016|AZ Legislation, Stories & Articles|Comments Off on Arizona House Bill 2410 Would Require Dispensaries to Grow Inside

Cracks Appear as Medical-pot Licenses up for Grabs

Arizona Daily Star:  “For the first time since May 2012, the state will accept applications for medical-marijuana dispensary licenses this summer.  The announcement by the Department of Health Services comes as Arizona patients spent $215 million on 19 tons of medical pot last year, nearly double the 10 tons purchased in 2014.  Even with record-breaking sales, lawsuits filed by business partners alleging breach of contract, mishandling of funds and other corporate malfeasance hint at cracks in the industry’s foundation.”

The story quoted yours truly:

“Medical-marijuana dispensaries are “extremely hampered” by a lack of easy access to banking services, said Scottsdale-based business lawyer Richard Keyt.

By |2016-02-28T10:36:12-07:00February 28th, 2016|Stories & Articles|Comments Off on Cracks Appear as Medical-pot Licenses up for Grabs

Oops! New Mexico Girl Scouts Mistakenly Sell Outside a Marijuana Dispensary

KRQE News: “The communications director for the Girl Scouts of New Mexico Trails, identified as Carol Ann Short, emailed News 13 saying that selling outside medical marijuana dispensaries is against scout rules.  Short points to the 2016 Troop manual, which includes the following provision:

Booth locations are NEVER allowed at liquor stores, smoke shops, or medical dispensaries

Two local Girl Scouts set up shop at a unique location in Albuquerque on Saturday.  It’s that time of year — Girl Scout cookie season. The young ladies are back at it, enticing cookie-craving customers to hand over a few bucks a box.  Abby Sargent, a Junior Girl Scout, and Mary Jane Temer, a Brownie, sold their cookies outside Ultra Health, a medical marijuana dispensary on Menaul, on Saturday afternoon.”

By |2019-06-18T19:55:54-07:00February 27th, 2016|Stories & Articles, Zoned Properties & Duke Rodriguez|Comments Off on Oops! New Mexico Girl Scouts Mistakenly Sell Outside a Marijuana Dispensary

Arizona’s Medical Marijuana Program Receives Above Average Grade

KTAR News:  “Arizona’s medical marijuana program ranked above average compared to the rest of the country, according to a new report from Americans for Safe Access.  Arizona received a B-minus on the organization’s annual state report card. The Grand Canyon State scored high in every major category, except product safety.”

By |2016-02-28T10:41:10-07:00February 25th, 2016|Stories & Articles|Comments Off on Arizona’s Medical Marijuana Program Receives Above Average Grade

Arizona Marijuana Legalization Allows Patients to Grow Maybe

Phoenix New Times:  “League of Arizona Cities and Towns says cities won’t be able to ban home cultivation under the CRMLA. . . . Does a marijuana-legalization initiative expected to be on the ballot in November allow cities and towns to ban adults from growing their own marijuana?  Under the initiative, adults 21 and older could grow up to six plants, with a 12-plant-per-household maximum.”

By |2016-02-28T10:31:08-07:00February 25th, 2016|AZ Legislation, Stories & Articles|Comments Off on Arizona Marijuana Legalization Allows Patients to Grow Maybe

Tucson Makes It Easier for Medical Marijuana Dispensaries to Expand

Tucson Weekly:  “It’s going to get a lot easier for medical marijuana dispensaries in Tucson to expand thanks to three zoning amendments the City Council passed Tuesday evening.  Here’s the good news:  Outdoor cultivation of medical weed is now allowed in industrial zones in accordance with state law. The Arizona Medical Marijuana Act says that outdoor growing is good to go only if the area is surrounded by 10-foot walls made of metal, concrete or stone that prevent outsiders from seeing the marijuana plants.”

By |2017-02-12T07:41:25-07:00February 25th, 2016|Stories & Articles, Zoning|Comments Off on Tucson Makes It Easier for Medical Marijuana Dispensaries to Expand

Arizona to Accept New Medical Marijuana Dispensary Applications

Phoenix New Times:  “The Arizona Department of Health Services just announced that it will begin taking applications for new dispensaries this summer.  This is the first time the state will be reviewing new applications for dispensary operating certificates since a lottery was held in 2012 that resulted the current roll-out in Arizona of nearly 90 medical-cannabis retail stores. . . . ‘The Department will accept dispensary registration certificate applications this summer, following the allocation process and requirements in rules.’ “

By |2016-02-23T06:43:28-07:00February 23rd, 2016|Dept Health Services, DHS Rules, Stories & Articles|Comments Off on Arizona to Accept New Medical Marijuana Dispensary Applications

Arizona Department of Health Services to Accept New Applications for Medical Marijuana Dispensaries

After quietly removing its notice last year that said it will accept new applications for Arizona medical marijuana dispensaries, the Arizona Department of Health Services posted the following statement on its website:

“The Department will accept dispensary registration certificate applications this summer [2016], following the allocation process and requirements in rules. This announcement will be updated at least 30 calendar days before the date the Department begins accepting applications. More information will be posted on this Dispensary webpage as it becomes available.

By |2016-08-05T14:35:44-07:00February 19th, 2016|Dept Health Services, Stories & Articles|Comments Off on Arizona Department of Health Services to Accept New Applications for Medical Marijuana Dispensaries

Duke Rodriguez New Mexico Marijuana Guru

The Albuquerque Journal wrote two stories about medical marijuana in New Mexico and former Arizona medical marijuana bad boy Duke Rodriguez.  The stories are:

Here are some quotes from the first story:

“Duke Rodriguez, the principal of Ultra Health, also expresses pride in the facility, where he grows 450 marijuana plants at a time, the maximum allowed under state Department of Health regulations.  But Ultra Health is not one of the state’s 35 licensed nonprofit producers authorized by the New Mexico Department of Health to grow and sell medical marijuana. . . . Ultra Health is unusual, if not unique, among the state’s marijuana producers in that it is not a New Mexico-based entity. Ultra Health is a limited liability corporation based in Scottsdale, Arizona”

Quotes from the second story:

“Duke Rodriguez, principal of Ultra Health LLC, first became involved in the medical cannabis industry around 2013 in Arizona.  He purchased the 11-acre marijuana-growing facility in Bernalillo in August 2014 on behalf of an Arizona corporation called Zoned Properties Inc. . . .

Ultra Health became the sole owner of the Bernalillo property as a result of a settlement reached in a lawsuit filed last year.

In March 2015, Zoned Properties filed suit in Arizona Superior Court against Rodriguez and Ultra Health in a dispute over business interests in Gilbert, Ariz., according to public records filed by the company.

In a settlement reached in July, Zoned Properties transferred ownership of the $2.7 million Bernalillo property to Rodriguez and Ultra Health, a company disclosure statement said.

Under the settlement, Rodriguez transferred ownership of a 48-acre property and growing facility in Chino Valley, Ariz., to Zoned Properties. Rodriguez also relinquished his ownership stake in Zoned Properties.

See “Zoned Properties, Inc. & Duke Rodriguez Lawsuits.”

Zoned Properties, Inc., published a quarterly consolidated financial statement for the nine months ending 1, 2015 that sheds light on Duke’s statements about his settlement with Zoned Properties, Inc.

On January 29, 2014, the Company entered into a purchase and consulting agreement (the “Ultra Agreement”) with Ultra Health, LLC., a related party due to common ownership and investments made by beneficial stockholders of the Company (“Ultra Health”), pursuant to which the Company was to acquire a 1,536 square foot modular building to be delivered and erected on the purchased land for total cash payments of $675,000. Subsequent to the purchase of this land and building, these real estate assets were transferred to Gilbert Property, LLC, a wholly-owned subsidiary of the Company. In connection with the 1,536 square foot modular building discussed above, on April 10, 2015, the Company became a party to a certain case pending in the Superior Court of the State of Arizona in and for Maricopa County, Arizona styled, Zoned Properties, Inc. v. Duke Rodriguez, Ultra Health, LLC and Cumbre Investment, LLC (“The Defendants”), Case No. CV-2015-004225, wherein the Company alleges, among other things, that the Defendants, alone or in collusion with one another, breached a certain contract for the construction of the Gilbert building, and made material misrepresentations or had negligently misrepresented certain material elements upon which the Company relied, in purchasing the land upon which that building was to be constructed, which the Defendants failed to perform. The Company reviews it rental properties for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Based on this review, on December 31, 2014, the Company determined that the Gilbert building carrying value of $675,000 was not recoverable and recorded an impairment loss – related party of $675,000.  On July 9, 2015 and effective August 1, 2015, the Company entered into a settlement agreement with the Defendants that, among other things, settles the pending claims and grants mutual general releases. . . .

Zoned Properties, Inc. v. Duke Rodriguez, Ultra Health, LLC and Cumbre Investment, LLC On April 10, 2015, the Company became a party to a certain case pending in the Superior Court of the State of Arizona in and for Maricopa County, Arizona styled, Zoned Properties, Inc. v. Duke Rodriguez, Ultra Health, LLC and Cumbre Investment, LLC (“The Defendants”), Case No. CV-2015-004225, wherein the Company alleges, among other things, that the Defendants, alone or in collusion with one another, breached a certain contract for the construction of the Gilbert building, and had made material misrepresentations or had negligently misrepresented certain material elements upon which the Company relied in purchasing the land upon which that building was to be constructed, which the Defendants failed to deliver (See Note 3). On June 8, 2015, the Company filed a motion to dismiss the counterclaim. The motion to dismiss has been fully-briefed and was set for oral argument on August 7, 2015. On July 9, 2015 and effective August 1, 2015, the Company entered into a settlement agreement with the Defendants that, among other things, settles the pending claims and grants mutual general releases. Under the terms of the settlement:

1. On August 1, 2015, the Company transferred title to its Bernalillo, New Mexico property to Defendants. At June 30, 2015 and December 31, 2014, the carrying value of this property was $2,719,658 and $2,737,863, respectively. In connection with such property, the Company forfeited quarterly straight-lined rental revenue of approximately of $287,000 through September 2024. For the six months ended June 30, 2015, rental revenues from this property amounted to $120,000. The Company did not have rental revenue from this property in the comparable 2014 periods.

2. The Defendants returned 2,496,054 shares of common stock to the Company and the Company cancelled such shares. On the Settlement Date, such shares were valued at $1,406,603 or $0.5635 per common share which represents the cost of the treasury shares purchased and retired.

3. The Defendants effectuated the transfer of four parcels of property in Chino Valley, Arizona to the Company which consists of approximately 48 Acres of land and the Company acquired an additional parcel in Chino Valley for $200,000 in cash. Based on an independent appraisal, on the Settlement Date, the fair value of property obtained, consisting of land, buildings and improvements, amounted to approximately $1,528,000.

4. The Company shall obtain water rights associated with property in Chino Valley, Arizona.

In connection with the settlement, on the Settlement Date, the Company did not record any settlement gain or loss.

 Zone Properties’ financial statement contains some interesting line items for a publicly traded company:

  • $297,695 revenue excluding revenue from related parties
  • $1,011,008 professional fees
  • $(976,579) loss from operations
  • $(1,145,170) net loss
By |2017-02-04T07:38:56-07:00February 15th, 2016|AZ Marijuana Law Lawsuits, Stories & Articles, Zoned Properties & Duke Rodriguez|Comments Off on Duke Rodriguez New Mexico Marijuana Guru

Arizona Pot Lovers Collecting More Money than Prohibitionists

Phoenix New Times:  “New reports show the finances of an anti-marijuana group lag well behind a pro-legalization campaign.  Arizonans for Responsible Drug Policy (ARDP), led by Yavapai County Attorney Sheila Polk, collected $90,095 in contributions from November 25, 2014, to December 31, 2015, according to campaign-finance reports released last week. After spending $19,000 of it on the fundraiser, legal fees, a website, and printed promotional materials, the group had $70,411 on hand by the end of last year.  Compared to financing of nearly a million dollars for the Campaign to Regulate Marijuana Like Alcohol in Arizona (CRMLA), the pot prohibitionists’ effort is getting steamrolled.”

By |2016-02-10T19:33:51-07:00February 10th, 2016|Stories & Articles|Comments Off on Arizona Pot Lovers Collecting More Money than Prohibitionists

A Guide to Internal Revenue Code Section 280E

The National Cannabis Industry Association (NCIA) recently released a 280E white paper that explains Internal Revenue Code Section 280E. The paper has an informative frequently asked questions section.  All Arizona medical marijuana dispensaries should get a free copy of the paper.

By |2017-02-12T07:41:24-07:00February 9th, 2016|Stories & Articles, Tax Issues|Comments Off on A Guide to Internal Revenue Code Section 280E

Veterans Fight for Medical Cannabis

Cannabis Now:  Not long after arriving in Baghdad in 2004, Ricardo Pereyda began to see the war differently.  Today the 32-year-old former Army MP explains it simply, ‘It was so much about profiteering over there,’ he says, ‘I didn’t want to get blown up so someone else could profit.’  Pereyda may have avoided serious physical injury but he saw plenty of others who weren’t as lucky. . . . Like so many vets, Pereyda was suffering from post-traumatic stress disorder (PTSD). . . . ‘My mind was in a dark and nasty place,’ he says.  He had about given up the idea of schooling when he learned about Student Veterans of America at the University of Arizona.”

By |2017-02-12T07:41:24-07:00February 6th, 2016|Stories & Articles|Comments Off on Veterans Fight for Medical Cannabis