HomeFAQ Opening a New Medical Cannabis Dispensing Collective
Opening a New Medical Cannabis Dispensing Collective FAQ
Note: This 'Opening a Collective' FAQ generously provided by Don Duncan (dondduncan at yahoo.com).
My name is Don Duncan. I am part of a team that founded and operates one of California's largest and most reputable family of collectives – with locations in Berkeley, West Hollywood, and Los Angeles. Together, these collectives have served thousands of legally qualified medical cannabis patients and their primary caregivers since 2000.
My goal is to help new operators organize their collectives in ways that are as safe and legitimate as possible in the current legal climate. A well-run collective is good for patients and for the grassroots movement to defend medical cannabis rights. A poorly run collective, however, is dangerous for patients and brings the integrity of our movement into question. Patients, operators, and advocates will all benefit from making our collectives the best they can be.
This document contains answers to frequently asked questions. Of course, you will want to talk to an attorney and accountant before you open your collective. My advice is not a substitute for help from other professionals.
You should read my short booklet "Medical Cannabis and Our Community.” You can download a copy at http://www.AboutMedicalMarijuana.com . This booklet is a very basic discussion about the place of medical cannabis collectives in the community and was written for elected officials and neighbors. It will be a valuable tool when you locate a home for your new collective. It is also a good introduction to the vocabulary of medical cannabis dispensing collectives and some of the legal issues regarding their operation.
You should also be familiar with a groundbreaking report from Americans for Safe Access (ASA) entitled “Medical Cannabis Dispensing Collectives and Local Regulation.” You can download a copy at: http://www.americansforsafeaccess.org/downloads/collectives.pdf
Based on interviews with elected officials, law enforcement, and civil servants; this report demonstrates the positive impact well-regulated collectives and cooperatives have on communities. This report will be a great tool for talking with landlords and local law enforcement about your plans.
Hopefully, this message, booklet, and report will help you on your way. I also offer paid consulting services for new and existing operators. My consulting services concern (1) basic guidance on starting a collective, (2) setting up systems and staff training, and (3) public relations and direct advocacy. My goal is to help clients achieve the highest possible degree of legal integrity and self-sufficiency. I do not act as a surrogate to open or operate collectives. Instead, I try to teach new and existing operators how best to do this themselves.
Some specific examples on consulting work I have done recently are: Explaining the legal situation at the local, state, and national level and exploring organizational and operational strategies for compliance
Developing systems and forms for new member screening, bookkeeping, inventory control, etc.
Preparing for and attending meetings with landlords to discuss renting to a collective
Training new staff (law enforcement, operations, customer service, etc.)
Advising on promotional materials and strategy
Networking and outreach with elected officials and law enforcement
Direct advocacy with elected officials
Strategic and crisis management planning
This is a dynamic field, and it is likely you will face unanticipated challenges. I hope to help clients overcome challenges, and be better prepared in the future. My hourly fee is $250, and I can negotiate flat rate fees for some services. Please let me know if I can be helpful.
Written by Don Duncan See: AG Jerry Brown's Guidelines
A medical cannabis dispensing collective is an organization operating in compliance with state law and comprised entirely of legally-qualified patients and their primary caregivers that provides medication exclusively to its members. Collectives are sometimes called dispensaries, compassion clubs, or cannabis centers. The exact terminology varies, and terms are sometimes used inter-changeably. I prefer the term dispensing collective to clearly associate theses organizations with California law as discussed below.
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Written by Don Duncan Medical cannabis is legal under state and local law, but it is illegal under federal law. Voters in California legalized the use, cultivation, and possession of cannabis for those with a doctor’s recommendation or approval when they adopted Proposition 215 in 1996. In 2003, the California State Assembly adopted Senate Bill 420 in order to implement and clarify Proposition 215 – effectively expanding its scope. Some of the content of that legislation and subsequent legal precedents inform the answers below. Unfortunately, medical cannabis remains illegal under federal law. We are working hard to resolve this conflict, but you should know that there can be serious legal consequences for breaking federal law.
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Written by Don Duncan No. In 2005, The Supreme Court ruled that the federal government has jurisdiction to prosecute medical cannabis patients, cultivators, and providers despite the fact that their conduct is legal under state law. (Specifically, the Gonzales v. Raich case dealt with the jurisdiction of the federal government over local, non-commercial activity.) Visit http://www.safeaccessnow.org/article.php?list=type&type=34 for more details about this case. Absolutely nothing in the Court’s decision preempted or overturned our state law. Legal experts and the California Attorney General agree that our state law remains in force. Some people are under the mistaken impression that federal law trumps state law in any case. This is false. The interaction of state and federal law under our federalist system of government is complex and controversial. Conflicts are not unheard of, and state law can stand in opposition to federal law in cases like this.
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Written by Don Duncan California Health and Safety Code §11362.775 authorizes patients and caregivers to “associate within the State of California in order collectively or cooperatively to cultivate marijuana for medical purposes” [italics added]. Unfortunately, the law gives no further clarification as to what constitutes a collective or cooperative association. The nature of these associations is evolving in step with California law and legal precedents. Read more...
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Written by Don Duncan Finding a landlord who will rent to a medical cannabis dispensing collective can be tricky. You will have to overcome some resistance due to legal concerns and stereotypes about patients. You must be straightforward with your landlord when looking to rent the property. If you mislead your landlord, he or she can have you evicted for violating your lease. Also, you will be starting a business relationship on very bad footing. Be prepared to explain who you are, what it is you want to do, and why will be good for the community. Do not be discouraged by rejection. There are hundreds of collectives in California, so someone is going to say yes! Landlords will need to know that you are financially stable and able to pay the rent. Good credit is very important in this process. Read more...
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Written by Don Duncan There are three possibilities regarding local regulations for collectives in any given city or county: (1) there is an established ordinance regulating collectives; (2) there is a ban or a moratorium preventing the establishment of new collectives; or (3) there are no local regulations at all. Unfortunately, Most cities and counties do not currently issue permits or licenses for medical cannabis dispensing collectives. This can leave a potential operator in an uncertain situation. Your strategy will depend on the situation in your city. I recommend discreetly researching your jurisdiction’s laws, and then moving forward based on the local situation. Licensing and permitting can be very case-specific. Contact me for input on your individual situation. Visit this link to get a partial list of local regulations: http://www.safeaccessnow.org/article.php?id=2208
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Written by Don Duncan Unless your city or county requires it, you do not need approval from law enforcement. The Police Department is likely to oppose a new collective. In fact, law enforcement has always been the leading opponent of medical cannabis. Do not expect a lot of support from your local police department. However, you do need to talk to them just before or shortly after you open your doors. You do not want your first interaction with the Police Department to be by surprise. Do not ask for permission – simply inform and include.
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Written by Don Duncan Yes. Medical cannabis remains illegal under federal law, and you are committing an act of civil disobedience every time you serve patients. You may face very serious charges for operating a collective. You have to be prepared to face this if you intend to operate in this political climate. Take some time to consider what you have to lose and how far you are willing to go before you open your doors. Read more...
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Written by Don Duncan A dispensing collective must obtain its medication from its registered members. This is a significant challenge for new dispensing collectives. You have to build your membership base before you have enough members to provide excess medication to supply the others. This may be very frustrating for new operators, but is an important phase to get through. Your members will understand if you do not have a wide selection when you first open. Encourage those members who do grow cannabis to bring their excess medication back to the collective to help the other members. Some legally qualified medical cannabis patients are very good at growing medicine. In fact, some have relatively large stores of excess medication. These fortunate patients will often be looking for a dispensing collective or cooperative to join. Some people refer to these patients as “vendors.” A better term is patient-cultivator. It has been my experience that these patient-cultivators will find you when you open your collective. I am sorry to say that I cannot help you locate medication for your new dispensing collective.
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Written by Don Duncan Yes. The California BOE has decided that all collectives must obtain a seller’s permit and pay sales tax. I believe this is an unfortunate decision that places an undue burden on patients while ignoring the intent of voters and the State Assembly. Nevertheless, you should collect and pay sales tax on every transaction. You may face serious financial and legal consequences if you do not.
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Written by Don Duncan There are safer and easier ways to make money besides operating a medical cannabis collective or cooperative. If you primary goal is profit, I strongly recommend you look elsewhere. Most operators make a suitable living, but more than you might imagine struggle financially in this line of work. It is hard work and there is no guarantee of success. Please give this careful thought before you sign a lease or make other commitments.
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Written by Don Duncan If you have not done so already, I strongly recommend that you visit several medical cannabis dispensing collectives. It will be very useful to see how other people are operating their collectives, so that you can decide if these models are right for you. You should also make a point to join and participate in Americans for Safe Access (ASA), the largest and most effective medical cannabis campaign in the country. ASA has invaluable educational resources for you and the patients you serve, and the organization is leading the fight to implement local regulations and change federal law. Visit http://www.AmericansForSafeAccess.org or call toll free (888) 929-4367 for more information.
Additionally, you should hire a criminal defense attorney and accountant or tax attorney. Please inquire if you would like to hire me for consulting as discussed above.
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Written by Don Duncan Operating a medical cannabis dispensing collective is a very important and compassionate project. It is also a lot of hard work. You should think hard about your level of commitment and the risk you're willing to take before you begin this project. Some operators would do better for themselves, the patients, and the grassroots movement for medical cannabis if they decided not to operate dispensing collectives. There are easier and safer ways to earn a living. This is a line of work that is most appropriate for people who are committed to compassion – and to the cause of medical cannabis. If you are not committed to upholding the letter and the spirit of the law and to conducting your business affairs in an ethical and reputable manner, then you should not pursue this line of work. You will do more harm than good. Read more...
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