How To Make a Dispensary Legal

There are several things you will need to do in starting your dispensary. We will cover several of these in other articles and in our free newsletter. However, in this article, we will cover the most important thing you will need to do in opening a legal dispensary and show you the best way of doing it. (You will save thousands in lawyer fees. Our free newsletter shows you these methods.)

Methods of applying are different state by state, but we will use California as an example for this article since it is the biggest state.

Using California as the example, the California attorney general states that, “Any group that is collectively or cooperatively cultivating and distributing marijuana for medical purposes should be organized and operated in a manner that ensures the security of the crop and safeguards against diversion for non-medical purposes.”

Know The Law of Your State

In 1996, California voters approved an initiative that exempted certain patients and their primary caregivers from criminal liability under state law for the possession and cultivation of marijuana. In 2003, the Legislature enacted additional legislation relating to medical marijuana.

One of those statutes requires the Attorney General to adopt “guidelines to ensure the security and non-diversion of marijuana grown for medical use.” (Health & Saf. Code, § 11362.81(d).1)

To fulfill this mandate, the attorney general issues guidelines to ensure that:

1) Marijuana grown for medical purposes remains secure and does not find its way to non-patients or illicit markets
2) Help law enforcement agencies perform their duties effectively and in accordance with California law
3) Help patients and primary caregivers understand how they may cultivate, transport, possess, and use medical marijuana under California law.

Form a Non-Profit Corporation

One of the many things you need to do to open a dispensary is to operate as a non-profit 501(c)3 corporation. In California, a lot of dispensary owners have chosen to operate as a non-profit because Senate Bill 420 says that caregivers are entitled to “reasonable compensation”. Non-profit organizations by name are not supposed to make a profit but they do have other ways of compensating you. They also have other special rules compared to operating as a normal corporation.

Many attorneys also recommend non-profits because they give you additional layers of legal protection.

Enroll in your states medical marijuana program

The Medical Marijuana Program (MMP) was designed to provide a patients with a voluntary medical marijuana ID card along with a registry program for qualified patients and their caregivers. The web-based system even allows law enforcement and the public to verify the validity of a qualified patient or caregiver by running their card as authorization of possessing, growing, transporting and/or using Medical Marijuana in California. To make the verification of authorized cardholders simple, the verification database is available on the internet.

In 2003, Senate Bill (SB) 420 (Chapter 875, Statutes of 2003) was passed as an extension and clarification of Proposition 215, the Compassionate Use Act of 1996. The Medical Marijuana Program, within the California Department of Public Health is administered through a patient’s county of residence.

Upon obtaining a recommendation from their physician for use of medicinal marijuana, patients and their primary caregivers are recommended to apply for and be issued a Medical Marijuana Identification Card from the county.

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