Plans for Recreational Marijuana Regulations in California Begin

imgresIt is well known that medical cannabis is big business for California. However, California’s history with the regulation of medical marijuana has been described as being subpar and disjointed, at best. After the fiscal analysis by the office of California Attorney General Kamala Harris was released, a Stanford Law class decided to draw up their own report analysis that outlines what the state should do to ensure that regulation, taxes and distribution of recreational marijuana is done properly.

The report, Analyzing Alternative Laws & Policies for Psychoactive Drugs Seminar, was presented by Stanford Law Professor Robert J. MacCoun’s law practicum. The report states that the intentions and the conclusions of the paper were not aimed at providing a recommended policy. The goal was to inform the public debate and highlight certain, important issues that might not have been otherwise widely recognized and understood.

The report covers three main areas: labor relations, regulation and taxation. While the nine students in the practicum did not adopt specific positions, they did draw some specific conclusions concerning these issues.  For example, in their opinion, one of the most pressing issues is the tension that continues to build between federal prohibition and state legalization.

One of the proposed solutions is to regulate and enforce laws through a single, integrated agency. This agency can be an existing state organization or a newly formed independent commission. Another option is to enforce and regulate laws through utilizing the strength of multiple agencies. This conclusion was drawn from the troubled history California has with trying to regulate medical marijuana. The thought of a powerful, well-informed (preferably independent) agency regulating recreational marijuana is thought to be a step in the right direction.

The report when on to cite the numerous tax bases that are being utilized in Colorado and Washington where recreational marijuana is already legal. The pros and cons of a high and low tax rate were then examined. A high rate was felt to limit the negative consequences that are associated with marijuana consumption. On the other hand, it could limit the amount consumed. Too low of a tax rate could mean that the government cannot obtain a meaningful revenue. On the other hand, it could help to eliminate the black market.

With the possibility that a ballot initiative could be passed for recreational marijuana in November 2016, the race is on to answer these important questions and set up a structure in the state of California that works better for recreational marijuana than the structure for medical marijuana has been.

For the sake of the marijuana businesses, many are hoping that the divide between federal and state will be one of the first issues to be addressed. Entrepreneurs are struggling to even get their businesses started since banks are hesitant to offer merchant accounts with the regulations they must follow on the federal level. For now, businesses continue to turn to marijuana business funding as an alternative solution to their payment processing needs.

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New MMJ Dispensaries Geared to Make a Ripple in U.S.

MarijuanaIn the last 10 days, 3 states have opened MMJ dispensaries. The states of Massachusetts, Minnesota, and Delaware have seen their first medical dispensaries. Medical marijuana advocates are elated by the openings and believe that they will do wonders for the industry as a whole, but some state officials are skeptical about the positive affects the facilities can have on the local and stare economies, and on the population in general. Here’s a small glimpse at the impacts the new dispensaries can have on their states.

In Massachusetts, the new dispensary faces the potential of running out of supply as only one other dispensary is operating and there are over 9,000 registered patients demanding product. This is because Massachusetts is slow to approve licenses for dispensaries. Since the legalization of medical marijuana in the state, only one out of 15 licensed dispensaries have actually managed to open.

In Minnesota they have the exact opposite problem. There are only two dispensaries in the entire state, but they are struggling due to extremely low demand (there are only 65 registered patients). Their only hope is to get more patients approved for medical cannabis, but that depends on Minnesota doctors clearing more patients for use. So far most doctors in Minnesota have been very reluctant to clear patients to use medical marijuana.

As for Delaware, the state only has 344 registered patients. Even though the state legalized medical cannabis in 2011, it has been slow to open dispensaries. Right now, only one dispensary will be operational. Despite the fact that these states face a few obstacles, the momentum is still on the side of MMJs. 2016 promises to be a better year for dispensaries when even more states are expected to legalize or decriminalize recreational and medical cannabis.

If more MMJ dispensaries open next year with large or sustainable demand, it could mean a significant boost for the MMJ industry as a whole. Now is the time for you to investigate more marijuana payment processing options for your dispensary.  The marijuana payment solutions provided by MMA will help grow your company’s business by giving your customers more ways to pay for your products.

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Recreational Marijuana Has Taken Over Medical in Colorado

The marijuana state, Colorado stampWhile many states are just now hopping on the medical marijuana wagon, the sales in Colorado are beginning to increase for recreational marijuana. Medical marijuana sales in Colorado actually fell during 2014. The number of medical cardholders also fell; these medical users have begun to purchase through recreational instead.

According to an article by Susan Scutti of Medical Daily, “Looking at the current trend line, the research and advisory firm predicts the average patient count will continue to decline – from approximately 114,000 in 2014 to 99,000 by 2020 – while the number of recreational users grows”.

Despite the legalization of marijuana in the state of Colorado, many remain hesitant and reluctant due to the substance still being illegal on the federal level. Colorado has not full embraced the legalized drug, medically or recreationally. Even though the tax revenues are tempting, most jurisdictions in the state will not allow marijuana sales – of any kind.

In addition, people are avoiding registering for a pot card. The illegal status of marijuana on the federal level is keeping people afraid that doing so will lead to feds busting down their doors. As a result of this fear, people have become willing to pay extra to be invisible.

Business continues to be difficult for those in this industry for the same reason that it is hard for its customers – the illegal status on the federal level. Marijuana has been and continues to be classified as a Schedule I drug; this means, according to federal law, marijuana has “no accepted medical use”.

Because of this, banks remain unwilling to allow dispensaries to deposit their profits with them. Acquiring business funding is also difficult, if not impossible. While legalization in the state of Colorado may be established, the reality and practice of it is a completely different story.

Many marijuana businesses have turned to medical marijuana payment processing. As states continue to legalize medical and recreational marijuana, providers that offer these specialized services are working to fill the gap that businesses need as the states continue to work through the process of acceptance that follows legalization.

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Will Increase in Competition Crash the Cannabis Industry in Colorado?

800x600-e922-odkazujeme01aRecent changes to Colorado’s recreational marijuana market has created a boom in the industry, but has left some afraid of over-saturation. Last October, the state ended its vertical integration rule and opened the market up to new entrants. Although the move has spawned a plethora of new businesses, it has also started conversations of impending price collapse and a fear that merchants will turn to the black market to reap lost profits.

Many growers believe the influx of new entrants will lead to a price collapse in the coming months as stand-alone growers increase competition and flood the wholesale market. On January 1, 2014, only medical marijuana facilities were granted Colorado permits, but last summer the state opened up the application process to businesses who were previously ineligible. This ended a crucial requirement that recreational shops grow at least 70% of the marijuana they sell.

Since the change, the number of recreational licenses in Colorado has jumped by 35% (870 licensed businesses). With this much added competition, fears of price declines may be well founded. According to Cannabase, an online marketplace that pairs growers with retailers, the price of recreational marijuana plummeted $600 per pound between September and December of 2014, while supply jumped at the same time. Cannabase CEO, Jennifer Beck, adds that the margins are now being squeezed in the state which could lead to a price crash.

Michael Elliot, the executive director of the Marijuana Industry Group, is concerned that the price drop could lead to desperate cultivators to turning to the black market to get better prices. If this happens, it would be a violation of one of the core eight principles defined by the Department of Justice. This would jeopardize the issuing of new licenses throughout the state.

Still, increased competition is good news for some in the industry. Businesses that deal in edibles now have more to choose from as more and more types of cannabis flood the market.

Despite the success of the cannabis businesses in Colorado, many merchants still find it difficult to secure competent recreational or medical marijuana payment processing from traditional payment processors. Luckily, there are some experienced online payment processors that specialize in fast and comprehensive marijuana payment processing.

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