Creating Retail Market For Medical Marijuana Would Drive Tax Revenue, Job Creation,

[bobandtorey]

Establishing a regulatory framework for the sale of medical marijuana could generate between $44.3 million and $63.5 million annually in tax revenue for Michigan, according to a new report. 

Over time, the industry could create 10,000 jobs through processing plants, growth and testing facilities, delivery services, and dispensaries. 

For the report, Dr. Gary Wolfram, director of economics at Hillsdale College, based his findings on a statewide free market plan proposed in a three-bill package currently before the Michigan Legislature. If passed, the legislation would set in place a regulated, private and taxable marketplace for the sale of medical marijuana. 

While Michigan voters opted to legalize the drug for medicinal purposes in 2008, its sale has since remained illegal. Currently, law-abiding patients’ only options are to grow their own medical marijuana or work with a registered caregiver. Many patients don’t have the ability to cultivate the plants properly, and the caregiver system presents its own issues, according to Wolfram.

“How do you find a caregiver and how regulated are they?” he said. “How do you know they have the right THC content? If it’s going to be difficult to get a caregiver anyway, why not just go out on the black market? What this (legislation) would do is bring it all out of the shadows.”

While patients can “reimburse” caregivers for their services, those transactions aren’t technically considered sales. As such, they remain untaxed by the state. The framework proposed by House Bills 4209, 4210 and 4827 would establish a 3-percent excise tax on retailers, along with the standard 6-percent sales tax. 

Currently, approximately two-thirds of the 182,091 registered patients in Michigan use the caregiver system. 

Wolfram assumes these patients would become retail customers, purchasing one ounce per month, the average quantity for registered patients across the state. At an average price of $285 per ounce, combined with the increase in paraphernalia sales seen in comparison states of Colorado and Nevada, the report estimates annual gross retail sales at $492.3 million

Altogether, with the combined sales and excise taxes at 9-percent, the revenue for the state comes out to $44.3 million annually. Wolfram considered the number to be conservative, stating that “this is just assuming there’s no expansionary effects.” The marketplace could potentially coax eligible users out of the black market with a more consistent and higher quality product.

“This legislation doesn’t add anything to how you become a patient,” Wolfram said. “It just says that if you are a registered patient, you’ll have a clear place to buy marijuana. Some people haven’t registered because they’re going to the black market. We assume more people will go to retail.” 

With this in mind, the report offers an alternative scenario in which 80 percent, rather than 67 percent, of registered patients use the marketplace, while the total number of all registered patients also increases by 20 percent. Under those circumstances, Michigan would receive nearly $63.5 million annually from 174,807 active consumers. 

The legislative package received overwhelming bipartisan support in the House, with roughly 90 percent of attending representatives voting in favor of each bill. 

Rather than getting its hands on the projected revenue, state government’s primary driver for the bills may be the legal obscurity of the current system, according to Wolfram. His report mentions that the Michigan Supreme Court has urged lawmakers multiple times to establish a framework, having “ruled on nine separate occasions that the (current) law contains too many loopholes.”

Since 2008, several dispensaries have opened their doors around the state under legally ambiguous circumstances, with local law enforcement generally choosing to turn a blind eye. In West Michigan, however, several locations were raided and shut down in 2015, according to reports. 

“That comes from inconsistent enforcement and a real widespread disparity in how different particular pockets of the state treat the legislation,” said Joe Voss, senior counsel for Clark Hill PLC of Grand Rapids. “From a legal standpoint, the legislation will definitely help advise people about what they can and cannot do around the medical marijuana business.”

Still, outside of the Legislature, there is opposition to a heavily regulated medical marijuana marketplace. Some patients and caregivers fear that the tiered structure of the proposed framework would make operations difficult for small business owners and affect access financially. 

“You have to support a regulatory system that needs infrastructure, and it can drive up price,” Voss said. “People do have black market systems set up already, and it’s not necessarily easy or financially beneficial to switch over to compliance.” 

A House Fiscal Agency analysis mentions similar concerns. The report’s authors acknowledge that patients could continue to self-grow or utilize the black market, “rather than pay potentially higher prices charged by provisioning centers.”

Until the legislation clears the Senate floor and gets presented to Gov. Rick Snyder for his signature, its impact remains uncertain. Wolfram expects that the bills will pass soon, especially in the face of multiple infrastructure crises on the east side of the state. 

“There’s this one city that has some water problems and another one with a school district that’s not doing too well,” he said, referring to the issues in Flint and Detroit, respectively. “I wouldn’t suspect it would be much longer, if they’re sitting with this much money that they could be gathering.” 

- See more at: http://mibiz.com/item/23445-creating-retail-market-for-medical-marijuana-would-drive-tax-revenue,-job-creation,-report-says#sthash.X1yOCfEw.dpuf

[+Malamute]

With this in mind, the report offers an alternative scenario in which 80 percent, rather than 67 percent, of registered patients use the marketplace, while the total number of all registered patients also increases by 20 percent. Under those circumstances, Michigan would receive nearly $63.5 million annually from 174,807 active consumers. 

 

 

 

 I love how they just pull numbers out of their arses.

 

I would guess at max the number to be closer to 50% of the patient population will use the dispensaries, and even less than that on a regular basis, unless hmmm,... caregivers get restricted? These dispensary lobbyists believe they can reduce it to patient grow only which will account for 13% of patients growing their own.

 

 But regardless, they are saying that PATIENTS themselves will bear the cost of paying the state ANOTHER $365 a piece in fees/taxes just to use cannabis in this state over what they pay now.  They will also be paying profits to dispensary owners at the rates of thousands per year per patient.

 

These people obviously do not understand the program and the finances of the typical patient.  They understand margins and greed.

 

 Commercialists need to quit thinking about making their money off of sick and disabled patients and start thinking the only way to make money is through full legalization.  THEN you can tax. We do not tax medicine in Michigan. Yet the main point dispensaries use is that patients will pay the state millions to use their dispensaries.

[bobandtorey]

Thank you

 

caregivers get restricted? These dispensary lobbyists believe they can reduce it to patient grow only which will account for 13% of patients growing their own ?

 

 

So i'm not sure of your point  do you mean caregiver our not restricted enough now ? Meaning by the courts ? 

 

Maybe i see  to many court cases "Live" and see  to many heartaches  and pain from their families 

 

I do understand the State doesn't want anyone to grow and in their mind maybe they think they can't control cannabis with out growing it them selfless 

[imiubu]

Home grows will cut into their profits.  Motivation enough for the greedy imho.

 

Are people seeing the writing on the wall YET?

 

$15 grams that are short in weight and have the medicine tumbled off...

 

IS RAPE.

 

These bad operators will eventually need to step their game up and serve

the pt's quality or they will be rousted out.

 

When is the last time cannabis users stayed w/ their 'dealer' if they

keep getting shorted / chit meds?

 

UMMM LIKE NEVER.  We find a different source and the bad egg gets

vetted out. 

[imiubu]

Is there a place for dispensaries ... sure.

 

Not as the only means for cannabis users to procure meds.

 

As with any other consumer product, we have the local little corner convenience store

right on up to the big box stores, and then we have local farmers markets.

Leaving the choice up to the consumers.

 

People generally invest to make a profit and imho, that is the bottom line... PROFITS.

 

Some will make these profits at any cost to the consumer...

 

Others... (FARMERS MARKETS for instance) cut out the middle man.

Direct from the producer to the consumer.

 

 

Why are we not pushing for the Farmers Mkt. model ?

 

If there is a place for these retail dispensaries, there is also a place for Farmers Markets.

 

Even our Legislators are seeing the big potential.  Anyone think they really care about

how the pt's/ cg's are served/ treated in the face of billions more dollars to squander at our expense? 

[Zerocool]

At an average price of $285 per ounce, what a joke if some one is paying that I feel sorry for them

[Dr. Bob]

I personally favor a farmers market approach.  Small scale grows, with excess medication being brought to a local market to redistribute to those that need it.  The idea of a few distributors and dispensary owners making large amounts of money bothers me, I'd rather see families making enough to cover their bills and maybe get a new vehicle now and again by supplementing their income at the markets.  

 

There are ways this can be done, and controls that can be put in place.  This isn't that hard of a concept.  It is caregiver/patient centered and makes good sense.

 

Dr. Bob

Edited March 21, 2016 by Dr. Bob

[imiubu]

bob, you are still an 'outsider' imho and not really a part of the cannabis community.

 

Making your living off the patients does not make you one of us.

 

 

 

If you are elected will you make farmers markets lawful?

 

Crap, I can't believe I am even attempting to engage w/ you. sigh.

 

 

I typically see OZ's at the fm's @$125 - $200.

FM's must have a place at the table.

[+Malamute]

I bet Bob would even sponsor legislation for farmers markets.

[trichcycler]

should those type of political questions posed to the same person running for office, be kept in the already created purposed thread, or should we continue to inject them into each thread across the board along the way I ask myself. I don't mind one bit really, some great questions and answers come of it no matter where I look. Its convenient  to see everyone

s smiling faces in every thread these days. Lots of political motivators reminding us to vote at every opportunity and that's good.  Traffic is increased, revenue goes up, its all good. I see new members joining already.  Welcome!!

[Dr. Bob]

I bet Bob would even sponsor legislation for farmers markets.

 

I bet you are right.

 

Dr. Bob

[+Malamute]

I bet Bob would even sponsor legislation for farmers markets.

 

I bet you are right.

 

Dr. Bob

 

 

 And there we go,....

 

 If you get elected I will help you come up with the language and lobby other rep's. Boom.

 

 See people.  Positions not personality.

 

Heck, I bet that farmers market bill could contain pt/pt transfers, organ donor protection, mmj/prescription drug equivalency, housing protections etc.

 

:-)

 

Like I said, I would vote for someone willing to do those things.

[Dr. Bob]

Your help would be much appreciated.  Probably the third thing I'd do in Lansing, right after finding my parking space and the rest room...lol

 

Dr. Bob

[+Malamute]

Hahaha...

 

I just wish the cannabis community would put someone up in every single district. Doesn't cost much. Better to try than to just complain.

 

 Actually, I am thinking of running myself. 

[+Malamute]

Let me add, I don't stand a chance.  Heh.

 

#1 issue: Free school breakfast and lunches for all public school students regardless of income.

 

:-)

[Indigro]

I personally favor a farmers market approach. Small scale grows, with excess medication being brought to a local market to redistribute to those that need it. The idea of a few distributors and dispensary owners making large amounts of money bothers me, I'd rather see families making enough to cover their bills and maybe get a new vehicle now and again by supplementing their income at the markets.

 

There are ways this can be done, and controls that can be put in place. This isn't that hard of a concept. It is caregiver/patient centered and makes good sense.

 

Dr. Bob

I would support someone on this.

 

My only extension is a localized system of both growing (smaller, better controlled, higher quality, greater diversity), and selling (local family owned small businesses, not limited licensing, massive weedmarts where the bulk of profits go to a handful of people, usually already very wealthy). Make it a truly open system, limit the size of any single entity, have massive participation to help local people raise the entire community into a middle class. Keep the money and profits flowing within the local community, through as many hands as possible, benefitting the entire community. Designate tax revenues for specific tasks such as k-12 education, or preventative medical care for the poor... Dont let the legislature indiscriminately decide where and when to steal that tax base for whatever selfish reason they might have. A mom and pop model of operating, the opposite of commercialized weed that is sweeping the nation... The already rich trying to jump in the game very late, continuing to jail people, continuing to profit from that, excluding as many others as possible.

 

Mi still has that possibility available, a better model for a better world.

 

Id even actively help such a candidate.

[Dr. Bob]

Now that we are a number of years into the MMMA, the problems with the legislation are starting to come out and we should try to work some solutions.  Legalization obviously is an option that would take care of many of them, but a focused plan B would be helpful.  

 

Problem one is the Farmers Market/Dispensary issue.  We clearly need this kind of third source for patient- trying different strains to find the right one, secure supply, clones/seeds, etc.  I favor the Farmers Market model utilizing the existing caregiver system.  

 

Caregivers already undergo background checks and have the ability to supply the markets.  Organizers can make some money with table rental, patients can get their meds without paying distributors and dispensary owners, and the caregivers get an actual source of income as long as they supply their patients.  This can be done.

 

Another issue is the respect for the card.  Courts allow patients to use their prescription medications because they have 'prescriptions'.  The cards are ignored by choice because they are viewed as a recreational substance and only have 'recommendations' due to personal bias by courts, prosecutors, and probation officers.  This forces patients to go back on medications like NSAID and Opiates that have real side effects and dangers.  It is the courts exposing patients to medical risk and suffering outside the input of doctors.  We need to close that loophole.  This same prescription v recommendation loophole is used by employers to hold good employees accountable for something which has no bearing on their jobs.  Unless you are 'impaired' at work as the act says, you should not be fired for something you did two weeks before.

 

Qualifying patients that choose to use cannabis should be able to get a certification from their primary care doctor, unless there is a clearly stated MEDICAL contraindication.  If patients are refused the card without a definable reason, and forced on to more dangerous drugs, the physician, medical group, hospital should have some liability if an adverse outcome occurs.  They should not be able to hide behind the excuse of 'we have a policy not to do that'.  We need to move from 'if we decide to make a policy to allow it' to 'shall issue if qualified'.  

 

These are things that can be addressed.  

 

Dr. Bob

[Jjamh]

i love what you are saying Dr. Bob & totally agree, so what next? Let's get the ball rolling. Oh ya, from what I've seen on here your prolly gonna get blasted by some of these people on here so stand by for that but stay the course, I love the farm market plan.

[Dr. Bob]

i love what you are saying Dr. Bob & totally agree, so what next? Let's get the ball rolling. Oh ya, from what I've seen on here your prolly gonna get blasted by some of these people on here so stand by for that but stay the course, I love the farm market plan.

 

 

It isn't a perfect plan, but we need to get that kind of thinking to Lansing.  You can start by liking the Facebook Page.

 

Dr. Bob

Edited March 22, 2016 by Dr. Bob
link removed

[Restorium2]

[Restorium2]

NOT;

 

[Jjamh]

Sorry, I'm not on Facebook, but I'm with ya. That was a cool video^^^

[Dr. Bob]

 

Exactly...

 

Dr. Bob

[Restorium2]

The real deal here in Michigan, real activists walking the walk ........

 

[phaquetoo]

I personally favor a farmers market approach.  Small scale grows, with excess medication being brought to a local market to redistribute to those that need it.  The idea of a few distributors and dispensary owners making large amounts of money bothers me, I'd rather see families making enough to cover their bills and maybe get a new vehicle now and again by supplementing their income at the markets.  

 

There are ways this can be done, and controls that can be put in place.  This isn't that hard of a concept.  It is caregiver/patient centered and makes good sense.

 

Dr. Bob

so you dont think it fair for the gov to get rich off of the poor but it is ok with you too!

 

You are an out sider, every one you certed could have been certed or renewed by a diff dr.   For at least 50 bucks cheaper and been seen in person and include a follow up, I have been a pt since the beginning, I have been thru a few mm dr.'s but not once had to use You!

 

I probably get a lil above average ssdi, maybe average for a person who paid in all of my working carreer, a new car now and than? what a joke, maybe if we can avoid gov run expenses we may be able to buy a new tire for our vehicles now and than, the mm pt's for the most part are poor including me,  saving 50 bucks a month wont pay for a new car, It would take 3 months of that savings to replace a tire on my 04 suv that was  bought used for a good price, and when it broke down it sat for months before we could save up enough money to fix it, let alone buy a new/used vehicle!

 

You dont live in most of our (pt's) reality, we dont own planes, we cant go months w/o pay!  Do you think it is our fault we are in this finanacial situation?

 

I think you should just stick to dr. questions and what you do for a living and not butt in on our live's,  we break laws and go to jail and hope some one will bail us out, you break the law and can hire big money attny's and keep on living normal,  kinda like a vacation eh?

 

Stick to what you know not what you think you know!

 

Peace