San Pedro Valley News-Sun: “With the Arizona Department of Health (ADHS) nearing the end of the study that will officially legalize medical marijuana by April, Arizona cities and counties are quickly working to approve zoning regulations. The Benson City Council and Planning & Zoning Commission held a joint session last week, discussing how to move forward with regulating medical marijuana distribution and use inside city limits.”
This Saturday at 9 am I am holding a free workshop for my Arizona medical marijuana dispensary owners to swap dispensary war stories and learn from two guest speakers about dispensary insurance needs and why dispensaries need an architect. Here are the details:
Time: 9 am – 11 am
Date: Saturday, March 26
Where: 8765 W. Kelton Ln, Bldg A-1, Ste 102, Peoria, AZ. Located on the SW corner of 87th Ave., & Kelton Lane (1 block south of Bell Road, just west of the 101 freeway).
Agenda:
by James Mc Cready, Managing Director
Arizona Medical Marijuana Medical Directors
The Arizona Department of Health and its director Bill Humble have made a tremendous step forward in the use of Medical Directors to assist in the application process and ongoing management of the Medical Marijuana Dispensaries; to be opened in Arizona, in 2011. Their efforts should ensure the first true “Medical Marijuana” program is established in Arizona.
The Arizona Department of Health has provided a number of important control mechanisms for the Dispensary Applications Process. We believe these steps are necessary to provide a complete and fair mechanism for Dispensary Certification. These measures will ensure the Dispensaries receiving certificates will provide the “Qualifying Patients”, “Designated Caregivers”, the citizens of Arizona, and the State Government of Arizona with the necessary guarantees of Ownership Qualification, Business Operation, Inventory Control, Security, Patient Record Keeping, Education and Support required by the new law.
Medical Directors will be an integral part of the Dispensary Application Process and subsequent Dispensary Operation. For the purposes of our discussion we will focus on the Dispensary Application Process only.
If you are applying for an Arizona Medical Marijuana Dispensary Certificate you will need a Medical Director before you send your application to the Arizona Department of Health. Here are the things you need to know according to Draft 01/31/11 (Remember the Final Draft will be out 3/28/11 and will give us the final word on these requirements):
1. The Medical Director must be an: Medical Doctor, Naturopathic Medical Doctor, Doctor of Osteopathy, or a Homeopathic Medical Doctor with an active Arizona License Number, which you will need to include on your application (Conversation with AZ Dept. of Health).
a. If you are a physician considering becoming a Medical Director. We are recommending to our physicians not to provide their name or license # for application process; UNLESS there is an independent contractor agreement in effect. We are also recommending other specific terms to protect the physician and dispensary, which are outside the scope of this article.
2. The Medical Director can not establish a doctor patient relationship with or provide a written certification for medical marijuana for a qualifying person (R9-17-312 E).
a. If you a re a physician considering becoming a Medical Director. We are recommending to our physicians not to provide a written certification for medical marijuana for any qualifying person. In other words if you are going to become a Medical Director you can not prescribe Medical Marijuana. This is an extremely important consideration. This will have to be a section in your independent contractor agreement. If the Dispensary losses it’s certificate to operate due to your prescription activities. You would be held responsible for the loss of the business. The cost to you would tremendous to you professionally and financially.
3. The Medical Director will need to provide “Policies and procedures that comply with the requirements in this chapter (R9-17-303) for:
a. Qualifying patient recording keeping (for further details see R9-17-312 C and R9-17-312 C)
b. Patient education and support (for further details see R9-17-312 C and R9-17-312 C)
If you a re a physician considering becoming a Medical Director here is what you will need to develop for your Dispensary:
1. Develop and provide training to the dispensary’s dispensary agents at least once every 12 months from the initial date of the dispensary’s registration certificate on the following subjects:
a. Guidelines for providing information to qualifying patients related to risks, benefits, and sides effects associated with medical marijuana.
b. Guidelines for providing support to qualifying patients related to the qualifying patient’s self-assessment of the qualifying patient’s symptoms including a rating scale for pain, cachexia or wasting syndrome, nausea, seizures, muscle spasms, and agitation.
c. Recognizing signs and symptoms for substance abuse.
d. Guidelines for refusing to provide medical marijuana to an individual who appears to be impaired or abusing medical marijuana.
2. Assist in the development and implementation of review and improvement processes for patient education and support provided by the dispensary.
3. Educational materials for qualifying patients and designated caregivers that include:
a. Alternative medical options for the qualifying patient’s debilitating medical condition.
b. Information about possible side effects of and contraindications for medical marijuana including possible impairment with use and operation of a motor vehicle or heavy machinery, when caring for children, or of job performance.
c. Guidelines for notifying the physician who provided the written certification for medical marijuana if side effects or contraindications occur.
d. A description of the potential for differing strengths of medical marijuana strains and products.
e. Information about potential drug-drug interactions, including interactions with alcohol, prescription drugs, non-prescription drugs, and supplements.
f. Techniques for the use of medical marijuana and marijuana paraphernalia.
g. Information about different methods, forms, and routes of medical marijuana administration.
h. Signs and symptoms of substance abuse, including tolerance, dependency, and withdrawal.
i. A listing of substance abuse programs and referral information;
4. A system for a qualifying patient or the qualifying patient’s designated caregiver to document the qualifying patient’s pain, cachexia or wasting syndrome, nausea, seizures, muscle spasms, or agitation that includes:
a. A log book, maintained by the qualifying patient and or the qualifying patient’s designated caregiver, to track the use and effects of specific medical marijuana strains and products.
b. A rating scale for pain, cachexia or wasting syndrome, nausea, seizures, muscles spasms, and agitation.
c. Guidelines for the qualifying patient’s self-assessment or, if applicable, assessment of the qualifying patient by the qualifying patient’s designated caregiver.
d. Guidelines for reporting usage and symptoms to the recommending physician providing the written certification for medical marijuana and any other treating physicians.
5. Policies and procedures for refusing to provide medical marijuana to an individual who appears to be impaired or abusing medical marijuana.
Our next article will deal specifically with the Legal Exposures and problems you will have as an Arizona Medical Marijuana Dispensary Medical Director. We will also discuss some possible solutions. However, as a licensed Physician you know that some challenges in practice are only resolved by a different and larger insurance policy.
If you are considering applying for Medical Marijuana Dispensary Certificate or a Physician looking to become a Medical Director as contact us Arizona Medical Marijuana Medical Directors (AZMMMD) at 602 578-4385. We offer a FREE Consultation to discuss your particular concerns.
James Mc Cready, Managing Director
Arizona Medical Marijuana Medical Directors
AZMMMD.com
602 578-4385
Yakima Herald: “Yakima County’s first trial over a so-called medical-marijuana dispensary or collective quickly ended in acquittal Thursday afternoon. The Superior Court jury that heard the charges against Valtino Hicks of Yakima returned its verdict in less than 25 minutes, unusually quick for almost any criminal trial.”
Mike Wakefield of Wakefield Architects, gave us permission to republish his detailed analysis of the steps a prospective Arizona medical marijuana dispensary must follow to get permission from a city to open a dispensary. If your dispensary needs an architect and it probably does, contact Mike at 602-595-7276. His office is located at 3848 North Third Avenue, Suite 3092, Phoenix, AZ 85013.
3 STEPS FOR A DISPENSARY BUILDING TO OPERATE LEGALLY:
I. Local City / Town Application (Zoning)
II. State of Arizona Department of Health Services Application
III. Local City / Town Certificate of Occupancy (Building Permit)
I. Local City / Town Application
Specific to City / Town Ordinances (available via website – i.e. www.phoenix.gov)
II. State of Arizona Department of Health Services Application
DRAFT 01/31/2011
TITLE 9. HEALTH SERVICES
CHAPTER 17. DEPARTMENT OF HEALTH SERVICES – MEDICAL MARIJUANA PROGRAM
R9-17-304. Applying for Approval to Operate a Dispensary
To apply for approval to operate a dispensary, a person holding a dispensary registration certificate shall submit to the Department at least 60 days before the expiration of the dispensary registration certificate the following:
2. A copy of the certificate of occupancy or other documentation issued by the local jurisdiction to the applicant authorizing occupancy of the building as a dispensary and, if applicable, as the dispensary’s cultivation site;
3. A sworn statement signed and dated by the individual or individuals in R9-17-301 certifying that the dispensary is in compliance with local zoning restrictions;
4. The distance to the closest public or private school from:
a. The dispensary; and
b. If applicable, the dispensary’s cultivation site;
5. A site plan drawn to scale of the dispensary location showing streets, property lines, buildings, parking areas, outdoor areas if applicable, fences, security features, fire hydrants if applicable, and access to water mains;
6. A floor plan drawn to scale of the building where the dispensary is located showing the:
a. Layout and dimensions of each room,
b. Name and function of each room,
c. Location of each hand washing sink,
d. Location of each toilet room,
e. Means of egress,
f. Location of each video camera,
g. Location of each panic button, and
h. Location of natural and artificial lighting sources;
7. If applicable, a site plan drawn to scale of the dispensary’s cultivation site showing streets, property lines, buildings, parking areas, outdoor areas if applicable, fences, security features, fire hydrants if applicable, and access to water mains; and
8. If applicable, a floor plan drawn to scale of each building at the dispensary’s cultivation site showing the:
a. Layout and dimensions of each room,
b. Name and function of each room,
c. Location of each hand washing sink,
d. Location of each toilet room,
e. Means of egress,
f. Location of each video camera,
g. Location of each panic button, and
h. Location of natural and artificial lighting sources.
III. Local City / Town Certificate of Occupancy (Building Permit)
1. Site Issues – Prior to obtaining a building permit, customers should perform “due diligence” to ensure the site complies with all zoning ordinance requirements. Key ordinance requirements include:
a. Distance of the structures to the property line or “building setback”
b. Percentage of the site covered by structures or “lot coverage”
c. Height of structures
d. All uses on-site (i.e. restaurant space, office area, etc.)
e. All parking and driveway aisles
f. Landscaping
2. Building Issues
a. Two complete sets of plans, drawn to scale, and if required per the Arizona Board of Technical Registration or local building department, signed and sealed by a licensed architect or engineer registered in Arizona. Plans include site plan, floor plan, plumbing and mechanical plan, electrical drawings, and structural drawings. Additional drawings, specifications, and calculations may be required depending on the scope of the project.
b. Description of the proposed project (new build, remodel, etc.) and the business operation.
c. Project address and legal description of the property (lot and block number, meets and bounds description). If an address has not been established, the city will assign one.
d. Owner’s name, mailing address, contact person and phone number.
e. Contractor name, address, phone number, contractor license number, state privilege tax number and city privilege tax number.
3. Inspections – In order for a building to obtain a Certificate of Occupancy, the structure must pass a series of inspections. In most cases, the inspections include, but are not limited to
a. Architectural inspections (where inspector checks if tenant space was built in accordance with an Architect’s stamped and approved drawings),
b. Electrical inspections,
c. Plumbing inspections,
d. Sprinkler inspections,
e. Fire alarm inspections,
f. Fire pump pressure test, &
g. Emergency egress.
Certificate of Occupancy Flow Chart
1) Submit building and site plans
2) Plan review
3) Approved or revisions requested
4) Revisions completed
5) Plans re-submitted
6) Second review
7) Permit fees paid
8) Permit is issued
9) Work commences
10) Inspections completed
11) Certificate of Occupancy (C of O) issued
Arizona Republic: “Scottsdale will consider granting use permits for five non-profit groups hoping to open medical marijuana dispensaries in the city.” See the article for the names and locations of the sites.
Arizona Republic: “Golf-equipment manufacturer Ping is threatening to leave its north Phoenix home of 45 years if the neighborhood continues to decline, its attorney says. Phoenix will do all it can to prevent that from happening, according to a top city official. The dispute between Ping and its neighbors came to light last week at the first use-permit hearings for medical-marijuana locations citywide.”
Wall St. Journal: “The U.S. medical marijuana market will reach $1.7 billion in sales this year, according to a report by See Change Strategy LLC. The market, which nearly rivals Viagra’s $1.9 billion in sales, is expected to double in the next five years as the number of patients grows and more states adopt laws allowing the sale of marijuana for medicinal purposes”
Arizona Republic: “The first five medical marijuana dispensaries approved in Phoenix are confined to office and industrial parks, an early indication that Phoenix’s new zoning rules for the dispensaries are so restrictive that few, if any, outlets will be located anywhere near the people who need them. Because of distance requirements from homes, churches, schools and parks, some real-estate attorneys believe there is virtually no retail site throughout the city that would meet the requirements.”
My DHS Wish
I continue to talk to many people who are having a very hard time finding a location to operate their Arizona medical marijuana dispensary. The Arizona Department of Health Services has inadvertently created a nightmarish situation for would-be dispensary owners who do not own the real property on which to operate a dispensary. The DHS rules coupled with very restrictive city zoning ordinances and many landlords who simply do not want to lease to a medical marijuana dispensary result in many more prospective dispensary tenants than available properly zoned dispensary sites. A lot of people have told me that they believe that one or more big money outfits are going around Arizona tying up potential sites with the goal of reducing the number of prospective dispensaries that apply for a dispensary license.
A large number of nonprofit entities are all fighting to tie up a small number of properly zoned and available sites throughout Arizona. This means that there will not be very many dispensary applications filed by the application deadline. It is a supply and demand problem. The demand among would-be dispensaries is high and the supply of properly zoned sites with willing landlords is low. Econ 101 teaches that when demand exceeds supply, the cost of the item (rent) goes up. Higher rents mean higher prices passed on to patients. One of DHS’ goals should be to keep the patients cost of medical marijuana down, not be the cause of patients paying higher prices to purchase their medicine.
The current rules and restrictive city zoning ordinances create a bizzaro world where nonprofits that do not have a license to operate an Arizona medical marijuana dispensary are entering into leases and applying for zoning with cities and they will never get a dispensary license. For many would be dispensaries it is a total waste of time and money, not to mention a waste of the cash-strapped cities’ time and money.
DHS should clarify in the final version of the rules that would be dispensaries need only to affirm on their applications for a dispensary license that their dispensary and grow locations comply with applicable zoning ordinances without the need to actually apply for or receive a city use permit. The rules should also allow the winners of a license to change the location of their dispensaries and grow facilities after obtaining a dispensary registration certificate, but before obtaining the final dispensary license. This would allow a dispensary to change locations after obtaining a dispensary registration certificate if the city denies the zoning use permit or any other problem arises with the site location stated in the initial dispensary application.
DHS: Please amend the rules to solve this terrible problem that will reduce the number of actual dispensaries, increase the number of patients who grow their own and cause higher rents to be passed on to patients.
See “Phoenix Medical Marijuana Locations Reflect Restrictive Zoning.”
Arizona Republic: “A Phoenix hearing officer on Thursday considered nine requests for medical marijuana permits – six for dispensaries and three for cultivation. The nine applicants were the first to come before the city.” Only six of the nine applicants received city approval. Read the locations, applicants and city decision.
ABC 15 TV: “Will Humble, who runs the state Department of Health Services, is ready to put the state’s recently voter-approved medical marijuana program in place and get back to his normal work. On March 31, his department will release all the rules governing Arizona’s medical marijuana program. On April 15, patients will be able to begin having medical pot recommendations certified, and on May 1, hopeful dispensary owners will be able to submit their applications for dispensary and cultivation operation licenses.”
Arizona Capitol Times: “Since voters passed Proposition 203 in November, the Arizona Department of Health Services has been racing against the clock to get rules and regulations in place that will guide Arizona’s medical marijuana program. According to Prop. 203, also known as the Arizona Medical Marijuana Act, ADHS by April 15, must be able to begin certifying qualified”
A Question of Justice: “Remember back when Obama was running for President and he made that promise? No not that one—the one about not making a priority of federal marijuana-dispensary busts in states where medical marijuana laws had been passed. Well, since he’s taken office he has proven that this is one area we can’t count on him to stand by his word.”
Daily Miner: “The Arizona Department of Health Services and the Legislature are trying to clarify when an employer can take action against an employee under the influence of medical marijuana. . . . According to the act, an employer cannot refuse to hire, discriminate against or fire an employee just because they have a medical marijuana card or because they test positive for marijuana and have a medical marijuana card, unless the employee was using, possessed or was under the influence of the drug while at work. . . . House Bill 2541 attempts to clarify when an employer can take action against an employee they believe in good faith is under the influence of marijuana while on the job.”
Phoenix Magazine: “Since the passage of Proposition 203 last November, which legalized medical marijuana in Arizona, the director of the Arizona Department of Health Services has taken pains to project himself as a fair and responsive custodian of the controversial measure, which goes into effect April 14.”
Yuma Sun: “If the mayor has his way, establishments that sell medicinal marijuana will face such stiff regulations that they’ll think twice about set up shop in the city. ‘The more stringent the better,’ Mayor Martin Porchas said, summing up his views about a proposed ordinance regulating the establishments.”
Answer: Yes. In 2007 the United States Tax Court issued its opinion in the case of Californians Helping to Alleviate Medical Problems, Inc. v. Commissioner of Internal Revenue. The issue in this case was what business expenses could a California medical marijuana dispensary deduct on its federal income tax return in light of Internal Revenue Code Section 280E, which states:
No deduction or credit shall be allowed for any amount paid or incurred during the taxable year in carrying on any trade or business if such trade or business (or the activities which comprise such trade or business) consists of trafficking in controlled substances (within the meaning of schedule I and II of the Controlled Substances Act) which is prohibited by Federal law or the law of any State in which such trade or business is conducted.
In the CHAMPS case, the IRS conceded that the taxpayer could deduct its cost of goods sold, which included $575,317 for marijuana. Based on news reports about recent IRS audits of big California medical marijuana collectives, it appears that the IRS wants to revisit Section 280E and how it applies to medical marijuana dispensaries.
Warning to All Would-Be and Existing Medical Marijuana Dispensaries about Federal Income Taxes
The IRS is auditing a number of high dollar revenue medical marijuana dispensaries in California. See for example “IRS tells California Medical Marijuana Dispensary it Owes Millions in Unpaid Taxes” and “Millions at Stake in IRS Audit of Oakland Medical Marijuana Dispensary.” I believe that the ultimate goal of the IRS is to change the result in the CHAMPS case, which will have the practical affect of putting almost all state legal medical marijuana dispensaries out of business. If a dispensary spends $1,000,000 to grow its marijuana in 2011 and none of that expense is deductible because of Section 280E, then the dispensary will pay federal income taxes of $340,000 that it would not pay if the expense were deductible. This means it actually will cost the dispensary $1,340,000 to grow $1,000,000 of marijuana.
I do not know why the IRS conceded in CHAMPS that the taxpayer could deduct the cost of goods sold. COGS was the taxpayer’s biggest expense. I believe the IRS regrets conceding in CHAMPS that the COGS was deductible. I predict the IRS will disallow the COGS of the medical marijuana dispensaries it audits. I believe the IRS wants to litigate this issue in federal district court rather than in Tax Court with the ultimate goal of having the 9th Circuit Court of Appeals rule that COGS is not deductible by a state legal medical marijuana dispensary. If the IRS can get one or more appellate courts to agree that the COGS is not deductible, the practical result may be to kill the medical marijuana industry in every state that has legalized it.
Tax Court vs. Federal District Court & Circuit Courts of Appeal
The CHAMPS case was a U.S. Tax Court case that had a good result for the medical marijuana dispensaries in states that have legalized the growing and sale of medical marijuana. Neither federal district courts nor Circuit Courts of Appeal are required to follow the decisions of the Tax Court. That is why the IRS wants to relitigate Section 280E in the federal district courts and then the appropriate Circuit Court of Appeals. The IRS wants to reverse the CHAMPS case by winning at the Circuit Court of Appeals level.
When the IRS conducts an audit and demands more taxes from a taxpayer, the taxpayer who wants to dispute the results of the audit has two choices:
Tax court decisions cannot be appealed. Federal district court decisions can be appealed by the losing party to the appropriate Circuit Court of Appeals, which is the 9th Circuit for California and Arizona. district courts. Any legal medical marijuana dispensary that is assessed additional taxes by the IRS will want to pay the additional taxes and have the Tax Court rule on the dispute. The practical problem with this tactic, however, is that most dispensary taxpayers will not have the cash to pay the amount of taxes in dispute and will be forced to litigate in the federal district court.
The choice of venue to litigate the dispute is significant. Dispensaries will want to pay the tax and go to the Tax Court where they expect the Court to apply the holdings of the CHAMPS case. Clearly the IRS does not want these medical marijuana dispensary Section 280E cases to go to the Tax Court where the CHAMPS case is bad precedent for the IRS. What the IRS is doing is going after dispensaries that have high income and expenses so that when it demands more taxes, the dispensaries most likely will not have the money to pay the amount in dispute and must then go to the U.S. district court. Because the amount of tax dollars in dispute will be so big, the loser in the district court will appeal to the 9th Circuit Court of Appeals where the IRS hopes it will get a favorable Section 280E ruling that will effectively allow it to tax legal medical marijuana dispensaries out of existence.
The Marin Alliance for Medical Marijuana is being audited by the IRS. When asked how much the IRS is demanding in back federal income taxes, Lynnette Shaw, the owner of this dispensary, would not disclose the amount, but she said, “It’s a staggering sum, millions and millions.” I’m guessing this dispensary does not have a few spare millions of dollars lying around to pay the IRS so it can litigate the dispute in tax court.
Related Stories:
Disclaimer
Although I have a masters degree in income tax law from New York University Law School, I am no longer a practicing tax lawyer. I recommend that every dispensary hire a good experienced tax CPA or tax lawyer to advise the dispensary on the federal and state income tax issues arising from the operation of a medical marijuana dispensary.
Circular 230 Notice: Pursuant to recently-enacted U.S. Treasury Department regulations, I am required to advise you that, unless otherwise expressly indicated, any federal tax advice contained in this communication, including websites linked to, is not intended or written to be used, and may not be used, for the purpose of (i) avoiding tax-related penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any tax-related matters addressed herein.
Sacramento Bee: Harborside Health Center in Oakland, California “handles $22 million in annual medical marijuana transactions. Now Harborside is attracting scrutiny from the Internal Revenue Service. Since last year, the IRS has been auditing 2008 and 2009 federal tax returns for the Oakland location, one of two outlets Harborside operates for 70,000 medical marijuana users. . . . Harborside and other California dispensaries – which currently pay more than $100 million in state sales taxes in addition to local fees – may be in peril if the IRS rigidly enforces its tax code.”
Payson Roundup: “Unable to construct a medical marijuana zoning ordinance, the Star Valley Town Council Tuesday put a moratorium on issuing dispensary and grow field licenses. . . . if the town followed Payson’s ordinance there would likely leave no room for one in Star Valley”
Marin Independent Journal: “The Internal Revenue Service has notified the Marin Alliance for Medical Marijuana in Fairfax that it owes millions of dollars in unpaid back taxes, according to the alliance’s founder and director, Lynnette Shaw. Shaw said the IRS audited the alliance’s tax returns for 2008 and 2009 and disallowed all of its business deductions. She said that although dispensaries throughout the state are being audited by the IRS, the alliance is the first to be told it can’t deduct business expenses. ‘Every dispensary in the nation, past, present and future is dead if this is upheld,’ Shaw said. . . . Shaw said the IRS disallowed her deductions — for buying marijuana, hiring employees, securing office space and more — based on section 280E of the federal tax code, which states that no deduction shall be allowed for any business trafficking in controlled substances.”
This story is a wake-up call and warning to all prospective Arizona medical marijuana dispensaries. Despite the CHAMPS case, which was decided in the U.S. Tax Court, the IRS apparently is disallowing ALL deductions of medical marijuana dispensaries. Prospective Arizona medical marijuana dispensaries should consider this fact when doing budgets and financial projections for their dispensary businesses. See “Californians Helping to Alleviate Medical Problems, Inc. v. Commissioner of Internal Revenue.”
The Spokesman-Review: “A Spokane jury rejected arguments Thursday that the state’s medical marijuana law allows for commercial dispensaries, convicting a supplier of multiple drug trafficking charges. Scott Q. Shupe, who co-owned one of the first marijuana dispensaries in Spokane, argued the state’s medical marijuana law enables dispensaries to supply card-carrying patients”
Bozeman Daily Chronicle: “Gallatin Valley medical marijuana businesses were open Tuesday, but many questions remained about what prompted federal raids of dispensaries across the state Monday. . . . The U.S. attorney’s office Tuesday said federal agents executed 26 search warrants in 13 cities and towns across the state in the first major crackdown on medical marijuana businesses since the industry took off last year. . . . the U.S. attorney’s office said the raids followed an 18-month investigation. However, federal officials did not make clear what distinguished the businesses raided Monday from other medical marijuana operations across the state, . . . . The businesses that were raided were some of the largest medical marijuana providers in the state“
See also:
Los Angeles Times: “Federal drug enforcement agents Tuesday raided two West Hollywood medical marijuana stores in the first such action in the city since the Obama administration decided two years ago to take a hands-off approach to dispensaries that abide by state laws. The dispensaries — Alternative Herbal Health Services and Zen Healing on Santa Monica Boulevard — are among four that the city has authorized to operate. . . . The DEA raided five of six dispensaries in West Hollywood in 2007, but has left the city’s stores alone since then.”
Will Humble’s Blog: “A few years ago, an Arizona law was passed that established a Controlled Substances Prescription Monitoring Program which requires pharmacies and medical practitioners who dispense Schedule II, III, and IV controlled substances to a patient, to report prescription information to the Board of Pharmacy on a weekly basis. The purpose of this legislation is to improve the State’s ability to identify controlled substance abusers and refer them for treatment, and to identify and stop diversion of prescription controlled substance drugs in an efficient and cost effective manner that will not impede the appropriate medical utilization of licit controlled substances. ” In this blog post he discusses House Bill 2585 and House Bill 2541.
The American Independent: “Federal agencies have stepped up efforts to crack down on medical marijuana, and while high-profile ATF raids may be more immediately shocking, there is a less direct tactic being used that could spell the death of medical marijuana across the country, according to its opponents. In the last several months, the IRS has begun targeting medical marijuana dispensaries in California, declaring that some owe millions in back taxes as a result of a section of U.S. tax code that the IRS is now applying to medical marijuana dispensaries.”
Boston Globe: “Rhode Island would become the first U.S. state to legalize marijuana for recreational use under legislation that would replace criminal penalties for possession with alcohol-style regulation and taxes on America’s most widely used illicit drug.”
Arizona Daily Star: “Even though Arizona voters have approved the use of medical marijuana, employers won’t have to tolerate workers who are stoned on the job. Nor will they have to allow them to fire up a joint at the workplace. . . . The new law raises several issues that employers will need to address and they may have to reevaluate their drug testing policies . . . . “
Will Humble’s blog: “Under the provisions of the Arizona Medical Marijuana Act we had 120 days to get the entire program up and running. A short timeframe for this complex program (to say the least). That gives us until close of business on April 13, 2011 to have everything ready.” He says that applications for patients, caregivers and dispensary agents will be 100% electronic online and will begin April 13, 2011.
Sonoran Star Remedies: “Whoa, hold on there, cowboy!!! . . . There are severe ramifications to having DHS backpedal on the requirement (January 31 draft rules) to have each dispensary be in compliance with local zoning restrictions. I suggest that we take a step back and consider what it would mean to strip away the rights of local municipalities to determine and drive their own zoning process.”
This interesting blog post is apparently in response to “Alan Sobol Adds the Rose Law Group to His List that Includes DHS, MPP & AzMMA” that discusses Alan Sobol’s March 14, 2011, letter to Arizona Department of Health Services Director Will Humble in which he complains about the uncertainty and problems caused by the DHS rules and city zoning ordinances. The author disagrees with Alan Sobol and suggests that the cities should be able to pick who gets a dispensary license rather than DHS.