Certified Public Accountant (CPA) firms handle the auditing, accounting, financial, and consulting aspects of nonprofit, private, and public businesses, along with government agencies. These organizations need a minimum of one state-licensed certified public accountant from the state they operate.
Each state establishes licensing and certification requirements of the CPA, which is why CPA qualifications differ from state to state.
In this post, we explain CPA firms, what it means, what they do, and common questions about the field.
Looking for a CPA firm to handle your company’s financial planning? Contact us now to speak with one of our experts.
CPA Firm Meaning
A Certified Public Accountant Firm (CPA firm) is a firm that’s licensed in the state it operates and is owned, at least partially, by a CPA.
CPA firms are usually auditing and accounting firms that go beyond generalized tax and accounting firms. From tax preparation to international accounting practices, these tax professionals represent clients while providing consulting services.
These firms can specialize in many different areas:
Business goals become more easily achievable with an expert CPA handling your company’s financials.
What is a CPA?
A Certified Public Accountant (CPA) is an accountant who’s licensed to provide auditing, accounting, financial, and consulting services for businesses. Their job includes evaluating performance metrics within the business, ensuring no laws are violated in the process of transactions or other operations that affect the company’s assets or income.
CPA services are essential come tax season. Between bookkeeping, tax planning, and filing returns, these professionals are crucial for businesses.
What Does a CPA Firm Do?
The work of a CPA firm is diverse and includes various financial services for businesses and government agencies. These services ensure organizations are operating without violating state and federal laws while implementing a strategy to scale.
CPAs offer their clients a wide range of services, which can be categorized in the following ways:
Auditing – Auditors assess a company’s financial statement to ensure it is an accurate reflection of the business’s financial position in case of an audit.
Tax Preparation – CPAs help businesses and individuals comply with tax laws and file tax returns.
Accounting – Accountants keep track of all business, personal, and investment transactions. They also help individuals or businesses prepare ledger entries, develop budgets, and reconcile accounts to balance out what has been earned versus what has been spent.
Financial Consulting – Financial consultants provide assistance with company goals so they can be achieved more easily. This usually involves providing information about financial metrics and how they affect the company’s growth.
Systems Implementation – This aspect of a CPA firm helps businesses transition to new software or technology by helping them understand how it works and what kind of return they will get on their investment.
It’s easy for companies to see increases in efficiency and productivity when an efficient system is implemented correctly. This is why most CPA firms worth their weight in gold are highly sought after for anyone who isn’t a tax professional themselves.
CPA Firm vs Accounting Firm
The main difference between Certified Public Accountant firms and accounting firms is that CPAs have a CPA license to provide auditing, accounting, financial, and consulting services for businesses. They also have a role to play in estate planning.
CPAs must meet stringent requirements set forth by the state they operate in. These requirements include holding a Bachelor’s degree (some states may have more demanding minimum education requirements) and passing the Uniform Certified Public Accountant Examination before becoming licensed.
Accountants, on the other hand, are not licensed and typically only provide tax preparation and bookkeeping services. While some accounting firms may have a CPA designation on staff, they are not required to have one.
Not all accountants are CPAs. However, all CPAs are also accountants that can represent clients to tax authorities like the Internal Revenue Service.
So, if you’re looking for a comprehensive financial solution for your business, it’s best to seek out a CPA firm. They have the experience and expertise to help your business grow and succeed.
CPA Services Summarized
As outlined above, CPA services typically include the following:
Auditing – CPAs help businesses and individuals comply with tax laws and file tax returns.
Accounting – Accountants keep track of all business, personal, and investment transactions. They also help individuals or businesses prepare ledger entries, develop budgets, and reconcile accounts to balance out what has been earned versus what has been spent.
Financial Consulting – Financial consultants provide assistance with company goals so they can be achieved more easily. This usually involves providing information about metrics shown in the operation’s financial statements and explaining how they affect the company’s growth.
Systems Implementation – These firms help businesses transition to new software or technology by helping them understand how it works and what kind of return they will get on their investment.
CPA firms are highly sought after for their expertise in tax planning, management of financial affairs, and providing businesses with the knowledge they need to keep on top of their business finances.
Accounting Services Summarized
Accounting firm services typically include the following:
Bookkeeping – Accountants keep track of all business, personal, and investment transactions.
Tax Preparation – Accountants help prepare individual or company tax returns. They can also assist with audits or appeals if a client is audited by the IRS.
Payroll Services – Some accounting firms will provide payroll services for clients so they don’t have to outsource this function.
Tax Planning – Accountants help clients figure out the best ways to reduce their tax burdens so they can keep more of what they earn.
Common Questions about CPA Firms
What is the purpose of a CPA firm?
These firms handle the accounting, auditing, financial, and consulting duties for non-profit, private, and public companies, along with government agencies.
What is a CPA consulting firm?
A CPA consulting firm is a private company that provides CPA services to clients. This usually involves analyzing financial statements and providing a clear path to profitability with the operation’s finances in mind.
What does being a CPA mean?
Being a CPA means that an individual is licensed and has met the state’s requirements to provide accounting, auditing, financial, and consulting services.
Are CPA Firms Better Than Accounting Firms?
These firms offer more knowledge to the companies they work with. The employees are experts in their niches, and they understand how to properly manage companies’ financials with legal legislation in mind.
Looking for a CPA team to handle your company’s financials? Northstar is here for you!
Contact us now to speak with one of our professionals and learn how we’ll scale your operation.
Michigan’s Marijuana Regulatory Agency is in charge of cannabis laws in the Great Lake State. However, these laws impact several parties.
Adult recreational consumers, medical marijuana patients, and caregivers will benefit from the information in this post. However, if you’re part of this state’s cannabis industry, this information is essential for your success.
Keep reading to learn more about Michigan marijuana and the regulations surrounding it.
Operating a Michigan marijuana business? Northstar is here to help you navigate cannabis compliance!
Contact us now to learn how we’ll scale your Michigan cannabusiness in this budding space.
Michigan Cannabis Safety Act
The Michigan Cannabis Safety Act was recently introduced by a bipartisan group of legislators. Through this update, Michigan’s medical marijuana laws will now facilitate safe patient and caregiver cannabis access.
At this point, unlicensed marijuana growers do not need to test, track, or label medical marijuana caregivers or patients purchases. They can also sell their leftover medical marijuana.
However, the new regulation will still permit cannabis grows by unlicensed caregivers.
Just like licensed caregivers, unlicensed caregivers are still allowed to grow medical marijuana under the Michigan Compassionate Care Initiative. They can also grow for one patient. But the main difference is now, many caregivers will be allowed to demand testing of specialty medical grower product.
Michigan Medical Marijuana Progress
“Michigan has an opportunity to be a national leader in cannabis safety, job creation and economic growth, and these bills help us rein in Michigan’s unlicensed cannabis market that threatens the health of all Michiganders,” explained state Rep. Jim Lilly, R-Park Township.
Ultimately, lifting this limit caregivers have been burdened with will improve the caregiver system tremendously. And we expect the medical marijuana prong of the cannabis industry to become a safe space as a result.
Michigan Cannabis Manufacturers Association (MCMA)
As black-market cannabis in Michigan continues to thrive, patient and consumer safety are at risk. Illicit market cannabis products aren’t tested for safety, lack labeling, and aren’t tracked or subjected to state taxes.
Unlike licensed retailers responsible for legal sales, the illicit cannabis market lacks safety, accountability, and transparency. And these aspects of this state’s cannabis industry are what the MCMA aims to change.
As one of the largest organizations working to limit caregivers, the MCMA also represents many of the space’s largest financial interests. One study they released in June estimates that nearly 66% of all cannabis sales in Michigan, around $3.2 billion in sales, happened through the illicit market.
Much of the market share remains illegal. And this is why the MCMA is fighting for regulatory reform, urging lawmakers and state officials to take action with new regulations and proposed changes.
The MCMA’s Commitments
The MCMA wants Michigan to become a leader in cannabis safety, innovation, and entrepreneurship. But the growing illicit market has the potential to destabilize the state’s regulated space.
Without cannabis law enforcement, cannabis cultivated illegally threatens to put people out of work. Countless businesses and opportunities are currently at risk as the illicit market continues distributing cannabis flower and other products.
Here’s what the MCMA commits to doing for Michiganders:
Medical & Recreational Cannabis Safety & Regulations
The MCMA focuses on enhancing customer and product safety. It also works to enforce each cannabis law while ensuring equality throughout the regulated cannabis marketplace.
In essence, for patients and consumers, this means the MCMA strives to guarantee safe, accessible products. But for entrepreneurs in this space, heavy regulation to ensure marijuana plants and products are created in accordance with state law.
High Standards for Marijuana Plants, Products, & Business Operators
While federal law is still restrictive, to legalize cannabis at the state-level means Michiganders need access to safe, high-quality medical and recreational marijuana. This federally controlled substance also needs some state-level control to maintain patient and consumer safety.
With the MCMA, lawmakers seek to maintain a strong Michigan cannabis industry. This ultimately results in more tax revenue generated and safer, more profitable legal cannabis sales in the Great Lake State.
Investing in the Medical & Recreational Cannabis Space
Members of the MCMA have already invested almost $1 billion in the state’s cannabis space. And let’s not forget about how this has stimulated Michigan’s economy.
The MCMA has hired thousands of employees as it built a foundation for the regulated cannabis marketplace. But it’s also supporting opportunities for new businesses to become a part of the regulated medical and recreational cannabis marketplace in Michigan.
Equality & Justice for Everyone Involved
The MCMA promotes social equity and social justice by calling for clemency and expungement for all non-violent cannabis offenders. This encourages people to work for the industry and delve in marijuana entrepreneurship.
MCMA members also support equal access to medical marijuana for patients and recreational cannabis for adults. While this industry has thrived, minorities constantly face criminalization and countless arrests.
This association aims to make minority-owned businesses eligible for state licensing through legislation. And it also pledges to open opportunities through accessible licenses and affordable licensing fees within the industry as more entrepreneurs join the legal landscape.
The War on Drugs has been detrimental to the community. This is where community revitalization comes into play.
The MCMA’s members are investing in innovative tech, good-paying jobs, and community revitalization to improve the state.
Michigan Cannabis Legislation for Regulation
Michigan Medical Cannabis Legislation
Proposal 1, the Michigan Compassionate Care Initiative, passed on November 4, 2008. With this measure, medical cannabis was legalized.
The measure allowed Michigan patients to possess up to 2.5 ounces of marijuana for certain medical conditions after receiving approval from a physician. However, dispensaries were not given permission to operate.
However, even without dispensary permission to operate, patients or their caregivers were given permission to cultivate up to a dozen cannabis plants.
In February 2013, the Supreme Court of Michigan decided that this 2008 initiative didn’t permit medical cannabis dispensary operation. Thus, there were between 75 and 100 dispensaries operating in this legal gray area at this point.
Then, in September 2016, Governor Rick Snyder signed a package of bills to implement some reforms. These included the following:
Permission for medical cannabis dispensaries to operate with the regulation in place,
Establish a 3% taxation rate for medical cannabis, and
Permit non-smokable cannabis forms like edibles and topicals.
Michigan Recreational Cannabis Legalization
In November 2017, the state’s legalization proponents submitted 365,000 signatures to get adult-use cannabis legalization on the 2018 ballot. Then, in April 2018, the state certified that cannabis supporters had achieved enough valid signatures to get it on the ballot.
In June, 2018, Michigan lawmakers rejected the option to pass this measure on their own. This sent it to the November ballot.
Michigan voters approved Proposal 1 by a 56 – 44 margin on November 6, 2018. In turn, the Great Lake State became the 10 state to legalize recreational use marijuana. Equally important to note is that it was the first state in the Midwest to do so, too.
The Michigan Regulation and Taxation of Marihuana Act
Through the Michigan Regulation and Taxation of Marihuana Act, anyone 21 years or older is allowed to possess up to 2.5 ounces of marijuana in public. They can also possess up to 10 ounces and cultivate up to a dozen plants at their residence.
This new legislation also created a system for state-licensed cultivation and distribution for marijuana. Sales became subject to a 10% excise tax, and the 6% state sales tax remained.
The law began implementation on December 6, 2018. Dispensaries opened their doors to the public on December 1, 2019.
Michigan Marijuana Consumption Insight
Consumption of recreational and medical cannabis in Michigan is legal. These products have been legal for medical consumption since 2008. But recreational marijuana didn’t become legal until 2018.
Federal law doesn’t permit marijuana consumption. However, while it’s still a controlled substance in Michigan, the penalties aren’t so harsh for personal use possession.
Michiganders can have up to 2.5 ounces on them legally. Furthermore, up to 10 ounces of cannabis flower at home is legal.
If someone has beyond 2.5 ounces but as much as 5 ounces, this is a civil infraction. The maximum fine for this offense is $500.
However, beyond 5 ounces for a first-time offender is a misdemeanor punishable by a maximum fine of $500. No incarceration time for any of these offenses, though.
What’s a Designated Marijuana Consumption Establishment?
You’re probably wondering about designated marijuana consumption establishments in Michigan. The state now has a Designated Consumption Establishment license that allows cannabis consumption on commercial property for adults 21 years old or older.
Keep in mind, a Designated Consumption Establishment cannot have retail sales of medical or recreational marijuana. But this is a tremendous stride in the right direction for increasing accessibility for consumers and opportunities for entrepreneurs.
Michigan Medical Marijuana Card Information
Through the Michigan Medical Marijuana Program (MMMP), the Marijuana Regulatory Agency administers the current law for patients and caregivers.
Click here to apply for a medical marijuana card online.
To apply, you’ll need to be a patient without a caregiver. You’ll also have to create a secure online account here.
For more information about applying, follow the instructions to apply for a Patient Only Registry Card here.
Michigan Caregiver FAQ
How do I become a caregiver in Michigan?
Caregivers must meet the requirements of the caregiver definition as per the MMMA. Then, a patient has to submit documentation to designate you as their caregiver.
The documentation can be a complete Application Packet if the patient’s registry card is expiring in fewer than 60 days or isn’t holding an active registry card. Patients can also submit a complete Add or Change Caregiver Form if the patient already holds an active registry card.
Keep in mind, you’ll need to submit your valid state-issued driver’s license or another personal identification card with the patient’s documentation.
Can a caregiver sell to a dispensary in Michigan?
As per some emergency rules created and implemented by the MRA, caregivers used to be allowed to sell products and extra cannabis to commercial operations. However, this has changed as of September 2020.
In the past, the licensed market was undersupplied. Caregivers supported the regulated market by selling to dispensaries for commercial purposes.
How much can a caregiver grow in Michigan?
Caregivers are allowed to grow up to 12 plants for each of their patients. Furthermore, they can possess up to 2.5 ounces of marijuana for each of their patients.
Caregivers and patients can legally grow indoors or outdoors. However, the grow must happen in an enclosed, locked facility.
Is Michigan getting rid of caregivers?
The licensed cannabis market no longer recognizes caregivers since September 2020. This phased out a caregiver classification that came about in 2008.
Michigan marijuana companies and politicians involved with regulatory affairs want to limit how much marijuana loosely regulated caregivers can legally cultivate. State lawmakers unveiled a package of bipartisan bills on September 14 that focuses on reducing the number of patients caregivers can serve.
Caregivers are allowed to serve up to five patients. However, if this law passes, the 12-plant-per-patient limit would limit how many marijuana plants a caregiver can grow and possess for personal use.
Cannabis activists argue that legitimate caregivers aren’t at fault. Instead, it’s the operations that use the title to legitimize their activities.
The proposed legislation creates a new license type for the specialty medical grower. This would operate within the regulated space. Specialty medical growers would need to pay $500 for application fees and put their marijuana through safety compliance testing.
Rick Thompson, a caregiver supporter and the director of the NORML Michigan chapter is against the change.
“There should be no changes to the current caregiver plant allowance, regardless of the addition of the specialty grower license type,” said Thompson.
Thompson claims that the proposed legislation is a “smoke-and-mirrors game” that is working to lessen the number of caregivers while hiding behind claims that consumer safety is the priority.
Cultivating Marijuana Plants in Michigan
Adults can grow marijuana plants (12 or fewer) at their residences for personal use. But the plants cannot be visible from a public place and must be grown in a secure place. A civil infraction can occur with a fine of up to $100, along with forfeiture of the cannabis.
For those who cultivate up to 24 plants for personal use, it’s only a civil infraction. The maximum fine is $500 and there is no maximum sentence for this offense.
Anyone caught illegally cultivating between 25 and 200 plants for personal use can have a civil infraction. This can result in imprisonment if it was “habitual, willful, and for commercial purpose or the violation involved violence.”
If someone is arrested cultivating beyond 200 plants for personal use, they could be charged with a misdemeanor. They might face some imprisonment if it was “habitual, willful, and for commercial purpose or the violation involved violence.”
While you won’t face a felony punishable by prison time if you aren’t operating as an illicit commercial entity, it’s always best to follow the rules in place. However, if you do decide to operate illegally in this space and face a felony punishable by prison time, it’s always best to have a cannabis lawyer ready to help just in case.
Michigan Marijuana Financial Services
Regardless of which stage your Michigan marijuana business is at, financial services are essential to scale. Compliance is a must in this industry, and having your financials in order will guarantee you adhere to all regulations in place.
Do you have a CPA on your team who understands the Michigan marijuana industry? From tax prep to other compliance matters, your operation will benefit from professional assistance.
Looking for help scaling your operation in this budding space? Northstar is here to help!
Contact us now to speak with one of our experts about how we’ll grow your operation with the right financial services.
Looking for information about how to serve medical marijuana patients in New Jersey? Or perhaps you want to get a medical marijuana card in Jersey.
Medical marijuana patients need to obtain medical marijuana. But it’s equally important that businesses handling legalized medical marijuana in the Garden State understand everything that’s involved.
The state medical marijuana program has nuances that must be followed. And if you plan to consume or distribute medicinal marijuana in New Jersey, you’ll find all of the information you need here and now.
Medical marijuana patients and business owners in New Jersey need to know what to expect in this budding space. In this post, we cover the ins and outs of the New Jersey medical marijuana card, how to get it, and how to serve a New Jersey resident through the state’s medical marijuana program.
Looking to scale your medicinal marijuana business in New Jersey’s cannabis sector? Northstar is here to help.
Contact us now for expert assistance navigating New Jersey’s medicinal cannabis industry with financial services.
New Jersey Medical Marijuana Laws
Compassionate Use Medical Marijuana Act
It wasn’t always possible to obtain a medical marijuana card in New Jersey. The Jersey medical marijuana program came along after the Legislature passed the New Jersey Compassionate Use Medical Marijuana Act (CUMMA), or S 88, in January of 2010.
New Jersey’s Medical Marijuana Program
Governor Jon Corzine signed CUMMA into law on January 18, 2010. However, this law was stalled after Governor Chris Christie took office the following day. It wasn’t until August 9, 2012, when New Jersey’s medical marijuana patient registry opened that registered physicians were allowed to initiate patient certifications with the state’s Medical Marijuana Program (MMP).
S 2842 in 2013
Eventually, more legislation was passed to expand the New Jersey medical marijuana offerings. Through S 2842, New Jersey medical marijuana included edible forms of medical marijuana that can be consumed by patients less than 18 years of age. Governor Christie signed this into law on September 10, 2013.
Governor Phil Murphy signed Jake’s Law on June 2, 2019. This law, also known as A 20, was named after Jake Honig, a patient who was using medical cannabis during his battle with cancer. Through this bill, New Jersey medical cannabis laws changed. It added provisions to increase the amount of cannabis allowed, permit home delivery, and expand the accessibility with additional cultivators, retailers, and manufacturers.
The Marijuana Legalization Amendment
Then, on November 3, 2020, New Jersey voters approved the Marijuana Legalization Amendment. This is also known as New Jersey Public Question 1. Through this amendment, the state legalized possession and use of marijuana for adult residents at least 21 years of age.
This same constitutional amendment made the New Jersey state sales tax rate (6.625%) apply to recreational cannabis purchases while allowing local municipalities to impose an additional tax of up to 2%.
The New Jersey Cannabis Regulatory, Enforcement Assistance, & Modernization Act
Months later, on February 22, 2021, Governor Phil Murphy signed the New Jersey Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act. Through this new law, possession of up to 6 ounces of cannabis became legal, as did 17 grams of hashish. It also set the marketplace framework up for cannabis business operators.
A1897 in 2021
Governor Murphy also signed A1897, which lessens the penalties for possession for as much as 6 ounces of cannabis flower and 17 grams of hashish. The governor also signed A5342, which made it so minors would receive written warnings instead of criminal penalties or fines for possession of cannabis products.
Where can medical marijuana patients in New Jersey access medical cannabis?
Medical marijuana can be accessed through New Jersey’s Alternative Treatment Centers (ATCs). The patient must visit a medical marijuana doctor to get a physician’s recommendation before making their purchase.
What taxes do card holders in New Jersey pay?
Each medical marijuana patient must have a state medical marijuana card. They also have to pay 4% in sales taxes, although that’s expected to be gone by July 2022.
Medical marijuana cardholders in New Jersey can be either patients or caregivers. They can buy up to 3 ounces each month. For terminally ill patients and those on hospice, there’s no monthly limit for the amount of medical marijuana they can buy.
What do medical marijuana patients in New Jersey have access to?
After visiting a licensed medical marijuana doctor in New Jersey, the patient is on the Jersey medical marijuana registry. Then, the medical marijuana patient will have access to the following forms of medical marijuana:
Infused Oral Lozenges
Medical Marijuana Topicals
Where can New Jersey medical marijuana patients consume medical marijuana safely?
New Jersey medical marijuana cardholders can consume medical marijuana at their private residences. However, some dispensaries might offer cannabis consumption areas for patients.
The Smoke-Free Air Act
At this point, patients can smoke medicinal marijuana while adhering to the Smoke-Free Air Act, which allows public consumption in much the same way as tobacco.
Regardless, the fact that medical marijuana establishments are allowed to offer consumption areas is massive for the industry. Medicinal marijuana consumption zones give these operations the chance to appeal to new patients by showing them how to use medical marijuana on-site.
Can New Jersey patients possess medical marijuana?
Yes, a medical patient can possess up to 3 ounces of New Jersey medical marijuana during a 30-day period. If the medical marijuana cardholder is terminally ill or in hospice care, they don’t have a limit.
Keep in mind, if you’re a medical patient or caregiver in New Jersey, you cannot cultivate cannabis plants.
How to Get a Medical Marijuanas Card NJ
How do I get a Jersey medical marijuana card?
First, you’ll need to speak with a doctor registered with New Jersey’s medicinal marijuana program. Jersey patients can only get a medicinal cannabis recommendation from physicians who are registered with the state program.
Once you meet with your physician, you’ll need to ascertain if medicinal marijuana is right for your condition. Terminal illness is usually a quick ‘yes’ for medicinal marijuana. But other conditions will be covered below.
Your medical marijuana evaluation will involve looking over your medical records. But the analysis goes further than your medical history; you’ll need to show that you need medical marijuana products to treat one or more medical conditions.
Here’s a list of the qualifying medical conditions a patient can have to get a medical marijuana card in New Jersey:
Amyotrophic lateral sclerosis (ALS), or Lou Gehrig’s disease
Cachexia, or wasting syndrome
Inflammatory bowel disease, including Crohn’s disease
Intractable skeletal muscular spasticity
Nausea and vomiting
Opioid use disorder
Post-traumatic stress disorder
Seizure disorder, including epilepsy
Terminal cancer or illness, if the physician determines the patient has less than 12 months to live
Regardless, you’ll need to become a qualified New Jersey medical marijuana patient. This involves visiting a licensed medical marijuana doctor in the state. You’ll need to register and get a valid state-issued identification card from the Department of Health (NJDOH) Medicinal Marijuana Program, as well.
Next, go to NJ Health’s ‘How to Register’ page. Here’s what you’ll need:
Your NJ Health medical marijuana reference number (your doctor will provide this)
Passport-style photo from within the last 60 days
Government-issued photo ID
Proof of New Jersey residency (discussed more in-depth below)
Registration fee of $100. However, some patients may pay a reduced fee of $20
You’ll need to submit the application on the NJ Health website. Patients cannot register in person.
Once NJ Health gets your application, it usually takes weeks to process. Once processed, it may take longer to receive your card by mail.
State-issued medical marijuana registry cards are valid for two years from their issue date. However, patients have to check in with their certifying physician a minimum of one time every 12 months.
Whether you need a medical card to treat post-traumatic stress disorder, epilepsy, chronic pain, a terminal illness, or something else, your medical history can tell your marijuana doctor all about your medical conditions. If there’s nothing on your medical records that shows your need for a medical card, you’ll likely need to get some additional tests.
You’ll also need to prove New Jersey residency. This is easy to do, and it can be done by presenting your driver’s license, motor vehicle registration, or voter registration along with three other forms of proof like income tax returns or proof of 12 months’ employment.
What happens after I get a New Jersey medical card?
Once you visit your New Jersey medical marijuana doctor, you’ll be allowed to legally buy and consume marijuana products as part of your treatment. Your medical cannabis card will tell Alternative Treatment Centers that they’re allowed to sell to you.
But on the other end of the spectrum, what’s involved in operating one of these ATC’s?
Operating a Medical Cannabis Business in New Jersey
The New Jersey Department of Health is responsible for regulating the state’s ATC’s. If you haven’t already received permission from the Jersey Department of Health, it’s unlikely you’ll be able to open an ATC.
Here’s a list of the ATC’s that currently operate under the regulations of the New Jersey Department of Health:
If you do decide to try opening an ATC in New Jersey, you’ll need to go through the Department of Health, which operates in consultation with the Attorney General’s Office. This entity has developed two screening tools it uses to efficiently and effectively oversee ATCs applying to the Department for permits to grow and dispense medical marijuana in New Jersey.
Through the Compassionate Use of Medicinal Marijuana Act, the Department has the authority to verify the information in all applications to get an ATC permit. It also has the right to ensure effective documentation of each ATC’s operations before issuing the permit. Furthermore, the Department is responsible for overseeing, monitoring, and investigating the activities related to all ATCs interested in operating in New Jersey.
The Department uses the Permitting Request Form and the Personal History Disclosure Form 1 and 2 to review all changes from the original application. It also uses this to collect and consider all relevant information from the ATCs and related entities. This offers guidance as it conducts background checks for all owners, officers, directors, and employees of the ATCs.
Contact the Medicinal Marijuana Program through the New Jersey Health Department to obtain these forms.
Best Practices for Serving Medical Marijuana Card Holders
While it’s difficult to start an ATC, recreational marijuana is now legal in New Jersey. If you haven’t already been approved to operate an ATC, you might be considering operating in the state’s recreational space.
Regardless of whether you distribute medicinal or recreational cannabis, you’re likely to serve medical marijuana cardholders. Military veterans, those who have social security disability benefits, and other people with a debilitating medical condition will still shop at adult-use operations.
Here’s a list of tips to keep in mind as you serve medical marijuana card holders in New Jersey:
Welcome New Jersey Patients
It should go without saying that as a cannabis business operator, you should welcome New Jersey patients with open arms. Besides encouraging patients to shop your assortment of products, you should also have plenty of information about each of your products and how patients can use them to treat their ailments.
Patients who use medical marijuana to treat their conditions need access to services. They will look for information about how cannabis affects the body. Some patients will also want to know how it interacts with other medications they are already taking. You should be ready to answer all of these questions and help patients find the right cannabis products for them.
Understand Debilitating Medical Conditions
Many medical conditions qualify patients for medical marijuana in New Jersey. Here’s a list of the medical conditions you should familiarize yourself with if you plan to serve patients in New Jersey.
Amyotrophic lateral sclerosis (ALS), or Lou Gehrig’s disease, is a condition where your nerve cells gradually die, limiting your ability to control muscle movement.
Medical cannabis can help with ALS by easing stiffness, spasticity, pain, and cramping.
Anxiety is the feeling of unease, worry, or fear. It’s generally triggered by a specific stimulus such as an event or substance.
Medical marijuana helps with anxiety by stimulating the body’s own endocannabinoid system. In particular, THC found within cannabis provides a calming effect that helps reduce anxiety and stress.
Cachexia, also known as wasting syndrome, is a condition where you lose weight and muscle mass. It’s often caused by heart disease, HIV, cancer, or other diseases.
Medical marijuana can help with cachexia by stimulating appetite, reducing nausea and vomiting, relieving pain, and improving mood.
Cancer is the uncontrolled growth of abnormal cells in your body. These cells form tumors that can invade the tissue around them and spread to other parts of your body.
Medical cannabis can help with cancer by inhibiting angiogenesis, or the formation of new blood vessels, in tumors. It can also reduce nausea and vomiting from chemotherapy treatments.
Chronic pain can include neuralgia, arthritis, migraines, and sickle cell disease. It’s a lasting pain that continues after the body’s initial injury has healed.
Medical marijuana can help with chronic pain by reducing inflammation, muscle spasms, and stiffness. It can also increase appetite and reduce weight loss associated with chronic pain.
Dysmenorrhea is pain and cramping associated with menstruation.
Medical marijuana can help with dysmenorrhea by reducing the muscle tension, inflammation, and nausea that contribute to pain and cramping.
Glaucoma is a condition where your optic nerve becomes damaged. This damages your sight and can eventually lead to blindness.
Medical cannabis can help with glaucoma by reducing the ocular pressure associated with the condition. This way, it reduces one’s risk of optic nerve damage and eventual blindness.
HIV, or human immunodeficiency virus, attacks the patient’s immune system and weakens it over time. AIDS is a later stage version of this condition where this attack depletes your white blood cells to dangerous levels.
Medical marijuana can help with HIV/AIDS by reducing pain, increasing appetite, reducing nausea and vomiting associated with treatment, and improving mood.
Inflammatory Bowel Disease (IBD)
Inflammatory bowel disease, or IBD, is a condition where your intestines become chronically inflamed. This can happen to your small intestine or large intestine.
Medical cannabis can help with inflammatory bowel disease by reducing inflammation and cramping associated with the condition. It can also stimulate appetite and reduce nausea and vomiting from treatment.
Intractable Skeletal Muscular Spasticity
Intractable skeletal muscular spasticity is a condition where the patient has persistent muscle spasms that are resistant to treatment.
Medical cannabis can help with intractable skeletal muscular spasticity by reducing the number of spasms, improving sleep quality, and increasing patient’s feelings of relaxation.
Migraines are severe, recurring headaches associated with nausea, photophobia (sensitivity to light), and phonophobia (sensitivity to sound).
Medical cannabis can help with migraines by reducing the number of headaches a patient gets. It’s also known to reduce nausea and vomiting associated with migraine treatment.
Multiple sclerosis is a condition where the patient’s immune system attacks the myelin sheath that protects nerve cells. This can eventually lead to muscle weakness and tremors in the patient.
Medical cannabis can help with multiple sclerosis by reducing inflammation, pain, spasms, and drooling associated with the condition. It may also provide relief from depression associated with multiple sclerosis.
Muscular dystrophy is a condition where the patient’s muscles become weakened and eventually stop working properly.
Medical cannabis can help with muscular dystrophy by reducing muscle spasms and muscle twitches associated with the disease. It may also improve appetite and reduce weight loss in patients with muscular dystrophy.
Nausea & Vomiting
Nausea is a feeling of unease and discomfort in the stomach that can lead to vomiting. It’s an undesirable side effect of some medications, as well as some diseases.
Medical cannabis can help with nausea and vomiting by improving appetite, reducing gastric pain associated with the conditions, relieving anxiety associated with being sick, and reducing stress caused by pain.
Opioid Use Disorder
Opioid use disorder is when a patient overuses opioid drugs. These drugs have an addictive tendency, which can have a negative impact on the patient’s life and those around them.
Medical cannabis can help with opioid use disorder by reducing withdrawal symptoms, cravings, and the desire to continue using opioids. It’s also known to reduce the pain that opioids are used to treat.
Post-Traumatic Stress Disorder (PTSD)
PTSD is a chronic condition where the patient’s memories of traumatic events can come back to haunt them. It often results in hallucinations, flashbacks, trouble sleeping, and severe anxiety.
Medical marijuana can help with PTSD by reducing stress associated with the disorder, lowering anxiety, and improving sleep quality for patients struggling with PTSD.
Seizure Disorder, Including Epilepsy
Seizure disorder, including epilepsy, is a condition where the patient suffers from recurrent seizures. These seizures can impact physical and mental health in a variety of ways.
Medical marijuana can help with seizure disorder by reducing the severity and duration of seizures for patients struggling with this chronic illness. It’s also known to reduce anxiety associated with living with a chronic illness.
Terminal Cancer or Illnesses
Terminal illnesses are diseases where the patient isn’t expected to live for more than 2 years. Glaucoma, one of the qualifying conditions to obtain medical marijuana in New Jersey, is an example of a terminal illness that is often treated with medical marijuana.
Medical marijuana can help with terminal cancer or illnesses by improving appetite and relieving pain associated with diseases like cancer.
Tourette’s syndrome and tics are neurological symptoms where the patient makes involuntary sounds or movements. The severity varies from patient to patient.
Medical marijuana can help with Tourette syndrome by reducing tics, relieving stress associated with the condition, and improving sleep quality for patients struggling with this chronic illness.
Offer Flower Cannabis & More to Help New Jersey Patients
It’s common knowledge that smoking flower cannabis is not recommended for patients with certain conditions. Many people who don’t know this also think that medical marijuana is only available in flower form, which isn’t the case.
Patients can find cannabis-infused products like oils, vapes, and edibles at dispensaries around New Jersey. These products are often used to treat qualifying conditions that require different forms of cannabis.
New Jersey has made it very clear that patients should have access to medical marijuana in several forms. Here’s what you should familiarize yourself with to give New Jersey patients the best products for treatment:
Cannabis flower might seem basic, but it’s anything but. In New Jersey, many strains are available, and it’s up to you to know which ones will work best for which treatment.
Sativa-dominant strains are great for those who need to increase their appetite because it stimulates the brain and tricks the body into thinking that it’s hungry. Indica-dominant strains are perfect for those who struggle with insomnia.
Extracts such as oil, wax, rosin, shatter, and others come from cannabis flower and represent a potent form of medical marijuana. These extracts are often consumed on their own or used as a substitute for flower.
Cannabis vape cartridges contain oil that’s extracted from cannabis and mixed with a carrier liquid to be inhaled into a vaporizer pen. After the patient inhales, they can instantly feel the effects of medical marijuana without having to smoke flower or wait for edibles to kick in.
Infused Oral Lozenges
Infused oral lozenges are an edible form of medical marijuana. These lozenges come in different flavors and can be used to treat a number of qualifying conditions. The lozenges are much like cough drops and dissolve slowly in the patient’s mouth.
Medical Marijuana Topicals
Medical marijuana topicals are used to alleviate pain in a specific area of the body. They come in forms like lotions, transdermal patches, and even bath soaks.
These topicals are effective ways for patients with chronic pain conditions to get needed relief without having to resort to opioids or other pharmaceuticals that could be addicting or dangerous to mix with other medications.
Offer Deals & Discounts to Patients
Offering deals and discounts to patients is an excellent way to show them that you care. It can also help encourage them to try new products and make purchases they might not have considered before.
If you offer deals and discounts, be sure that all patients qualify for the same promotion. It’s wrong to advertise that one patient has access to a deal while others don’t, and patients will appreciate the extra assistance.
Patients really like it when dispensaries offer special promotions and sales on medical marijuana products, so make sure you mention this in your marketing and advertising.
Offer Discounts for Veterans
Military and law enforcement veterans in New Jersey are also medical marijuana patients. The state’s MMJ program allows patients to register as a veteran and receive a reduced price on their purchases.
Make sure that your dispensary offers the same discounts to all veterans, whether they’re patients or not. You can even offer extra specials for military vets stationed in New Jersey’s various veterans homes.
Servicing Medical Marijuanas Card Holders in New Jersey
Looking to scale your operation in New Jersey? Northstar is here to help!
The right financial services will enhance your operations and prepare you for growth. Contact us now to expand your Garden State cannabis business in this budding space now.
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The cost to start a grow operation can be quite high. But it ultimately depends on what you’re willing to invest.
Minimally speaking, the cost to start a grow operation that will turn a massive profit will usually range in the hundreds of thousands of dollars. However, if you’re looking to build out a grow room on a shoestring budget, it’ll ultimately come down to how many square feet you’ll have in your grow operation.
You’ll need to think about all of the variables involved to accurately determine your cannabis grow operation startup costs. In this post, we’ll cover all of the considerations to give you a good idea of the average startup costs associated with indoor grow rooms and outdoor grows.
Interesting in scaling your grow operation? Northstar is ready to help!
Contact us now to speak with one of our experts about how our financial services will grow your operations in this budding space.
Growing in the Legal Cannabis Industry
So, how much does it cost to grow cannabis in the legal space? Well, if you want to grow marijuana legally, you’ll need all the equipment, real estate, and cultivation license.
First, let’s cover the licensing fees for a legal cannabis grow.
Application & Licensing Fees for Cannabis Cultivation
A legal cannabis grow operation needs to worry about the application and licensing fees first and foremost. These costs vary from state to state.
For instance, if you were to get a cultivation license in California for a 22,000 square foot canopy grow operation, you’d have to pay $4,945 for the application fee. You’d also need to pay the annual fee of $44,517.
Other states have their own specifications. But it’s important to remember that while you might save money growing cannabis illegally, it’s best to legitimize your operation.
Average Startup Cost Considerations in Cannabis
Think about how much cannabis you plan to grow. Then, consider whether you’ll use a grow room or focus on large-scale cultivation outdoors.
These operating costs will vastly differ from one another.
Here’s a list of average startup cost considerations for startup businesses growing cannabis.
The big question: how many square foot is your operation?
If you’re a master grower, you probably already know the cost per square foot for growing indoors is significantly more expensive than the average cost to grow weed outdoors. But for the new growers, this is still an important consideration.
If you plan to grow a few plants in your closet, this doesn’t apply to you. However, if you plan to use an industrial space, the price per square foot will rise.
The number of square feet in your operation really becomes costly if you’re planning to rent the space. For example, it could cost nearly $20 per square foot just to rent the space.
This is because landlords tend to charge more than four times as much for anyone looking to participate in the green rush. Regardless of whether you focus on outdoor grows or plan to get into a larger facility for an indoor grow, the ideal environment isn’t going to come cheap.
If you’re not using solar power or growing outdoors, you’re probably wondering what grow lights cost. Growing indoors means you’ll have less reliance on outdoor variables. However, you’ll need more equipment to enhance the environment.
So, how much does it cost to set up LED lights for a larger scale indoor grow?
LED lights are the most expensive option at first. However, they save money for your commercial grow. And this means you’ll get to keep more revenue or allocate it towards other business expenses.
The average cost, minimally speaking, it around $1,800. But this is just part of the cost to start a small operation with minimal plants.
Then, you’ll need to factor in the cost of electricity. But there’s more to it than that.
Grow room air circulation is essential for humidity control. But how much does it cost to get more fans running and humidity control systems in place?
More fans and more ventilation are needed if you have more plants in your grow room. This is how you maintain an ideal growing environment for your cannabis grow.
For a commercial grow, you’ll likely need to spend at least $100 on each fan. And if your commercial grow is massive, you’ll need quite a few fans and a ventilation system.
All of this costs money, of course. And for a decent size commercial grow, you should expect to spend at least $1,000 on the basic equipment you’ll need to produce air circulation that nurtures each plant.
Your grow room will need electricity. But what should you expect to spend on it?
That’s like asking how much does it cost for your electric bill each money without knowing the size of your house and how often you run your air conditioner. This will vary from grow room to grow room.
So, how much money should you expect to pay monthly for your power bill? It depends on what you’re running and the equipment efficiency.
If you have a grow room large enough to generate significant profits, your power bill will probably be $1,500 or more.
Water is essential for cannabis cultivation business success. Some growers even choose to use it as their growing medium as an alternative to soil.
But this is something for master growers.
If you’re just starting your marijuana cultivation business, you’re probably only using water to nurture your plants and flush the soil before harvest.
Most of the time, you’ll spend the same amount on the water as you do on electricity. With this in mind, you’ll likely spend at least $1,000 per month on your water bill if you have a sizable business.
Think about the growing medium you plan to use. If you want to cultivate premium marijuana plants, you can’t go wrong with organic soil. Organic living soil, to be exact.
Organic living soil has all of the nutrients your marijuana plants want and need. And this is something you can’t usually get from hydroponics systems.
However, organic soil isn’t perfect for every type of commercial grow operation. If you plan to use a hydroponics system or some other growing medium like coco coir, you’ll pay less for your initial setup and ongoing costs.
The medium you choose will affect your initial and ongoing costs. So, these can vary depending on your situation.
Consider Rockwool, hydroponics, organic growing soil, and other options. They all range in price, but you can expect to spend between $15 and $30 per plant on the medium.
Keeping marijuana plants healthy involves giving them the right nutrition. This is true, regardless of the medium you use for your grow.
The most common type of commercial cannabis fertilizer is a premixed blend that contains various nutrients, vitamins, and other chemicals your plants need to stay strong and resist disease.
Fertilizer costs will vary depending on the brand you choose and how often you plan to fertilize your grow. But, depending on how many plants you’re cultivating, you should expect to spend around $1,000 or more per harvest.
Feminized seeds take the guesswork out of growing marijuana. Rather than risking growing male cannabis plants, you’ll know you have female plants growing.
This is essential to avoid wasting resources on growing male cannabis plants.
Most of the time, you can expect to spend between $30 and $60 on each pack. But ultimately, the cost for feminized seeds is related to the strains you plan on growing.
Indoor Grow Room Costs
An indoor commercial grow produces throughout the year. However, this requires expensive equipment, so expect an indoor operation to cost more money.
Even with this being the case, an indoor marijuana grow has the potential to generate between one and twelve harvests annually. But the initial expenses could exceed what you’re willing to spend on your new cannabis grow operation.
Here’s what you can expect to spend on large scale indoor grows:
Warehouse rental – $50,000+
Build out, improvements – $50,000+
Growing equipment – $100,000+
Lighting system – $100,000+
Alarm & Security System – $25,000+
Licensing & legal fees – $55,000+
Direct costs (first months before profit) – $200,000+
Administrative expenses – $50,000+
Other expenses – $100,000+
Total = $730,000+
Concluding on Grow Operation Costs
Your grow operation will cost more than just seeds and nutrients. You’ll find yourself spending on electricity, water, and other supplies to get your grow started.
You can cut down some of your expenses, but ultimately, you’ll need to account for everything you spend on. This is something that can be handled with financial services.
Looking to scale your grow? Northstar is ready to help.
Contact us now for insight into how our financial services will expand your grow in this budding space.
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An experienced CFO is critical for ensuring compliance with the many rules, laws, and regulations that govern all aspects of legal cannabis.
As the legal cannabis industry continues to grow, so does the demand for professional business-to-business services such as finding an experienced and passionate chief financial officer or a bookkeeper that understands your unique challenges. And in the cannabis space, these services are essential for success.
But the option to hire a full-time business advisor or chief of financial operations isn’t always available. Whether it’s because of budgetary limitations or it’s too early to justify bringing full-time financial professionals into your business, a cannabis company doesn’t always need a full-time CFO.
Fractional CFO for Your Cannabusiness
So, how can cannabis operations obtain the business accounting, strategic planning, long-term CFO partner they need?
Northstar’s Fractional CFO Service for Cannabis
Keep reading to learn more about what we do as fractional CFOs and how we’re accelerating growth for business operators in the cannabis space.
Looking for an extraordinary outsourced CFO firm? Northstar has the financial professionals you need.
Contact us now to learn how our fractional CFO services save your business money while we scale your operation with services specifically for the cannabis space.
Northstar’s Fractional CFO Model
You don’t need to hire a full-time bookkeeper or CFO. In-house CFOs demand high salaries estimated up to $578,054 annually with benefits. And let’s not forget the added cost for overtime.
A fractional Chief Financial Officer will handle your operation’s needs at a fraction of the price. Rather than paying for a bunch of services you don’t need, you get what you need when you need it, with expert precision from Northstar.
You don’t have to spend hours looking for finance professionals. The interview process is long and challenging; in some cases, you might have to try multiple candidates to find the right fit.
With fractional CFOs, you can try before you buy. Rather than going through the entire hiring process, you’ll be able to make a quick hire for the services you need.
If it doesn’t work out, you don’t have to start that long process all over again. Simply move on to the next fractional candidate until you find the right fit.
Scale Up or Down Quickly
It’s easy and affordable to scale your operation with our fractional CFO model. This is the entry point cannabis businesses need to begin scaling.
Some seasons are busy. This is when you’ll want to scale fast with more services.
However, there will be times you’ll need to scale down. For example, your business might have other financial demands it needs to fulfill. By scaling back these services, you can allocate those funds appropriately to support your operation.
Immediacy to Cut Costs
The time spent hiring a new team member costs your business money. With this in mind, the immediate placement we provide saves time and money by limiting the time you devote to hiring.
Your business’s financial needs are critical; you need immediate assistance with business accounting, raising capital, and more.
Through Northstar, you fulfill immediate necessities. For example, if your current CFO leaves suddenly, you can replace them fast and continue operations without delays.
New Perspectives for Your Cannacompany
It’s always ideal to have fresh perspectives for your business. And the experience we have in cannabis will offer ideas that your team might not consider.
Goals and plans can limit the way your team thinks. But someone who isn’t involved in the daily operations will offer a viewpoint only achievable from the outside looking in.
For difficult decisions, this is valuable. Our impartial advice will help you navigate challenges that hinder success, allowing you to scale more easily.
More Expertise & More Knowledge
Expertise and knowledge go a long way in the cannabis space. This is especially the case for operations that don’t want to pay the hefty price tag of a full-time team.
You don’t just get one person working on your business’s success. Instead, you have our entire team with experience operating in the cannabis space.
Fractional CFO Services for this Elevated Space
The right fractional CFO service can provide the niche-specific business expertise your cannabis company needs to grow while keeping your access to these services within financial reality.
A fractional CFO service is just that: a handful of talented professionals who act as “sub-CFOs” for small businesses and startups. They share responsibilities with an outsourced general accounting team, bookkeepers, and other financial experts all while working under one cohesive fractional business consulting service.
Our fractional CFO services are the perfect solution for cannabis companies that do not need a full-time finance advisor or team to run operations. As your fractional CFO partners, our professionals offer experience in assessing business plans, managing virtual teams, and creating actionable strategies for growth.
Fractional CFO vs. Full-Time CFO Services
While a fractional CFO and a full-time CFO focuses on accelerating growth, the fractional CFO model comes with an assortment of benefits.
Full-Time vs. Fractional CFO Cost
Traditional CFO services are more costly on a month-to-month basis when compared to our fractional CFOs. This is because they provide CFO services, even when they might not be needed.
The fractional CFO model allows cannabis operations to overcome financial challenges as they arise. Rather than paying for a full-time CFO, you receive cost savings because you use the services as needed.
Not all cannabis businesses are ready to bring in a full-time team. Thus, hiring one in-house tends to be more expensive than most fractional CFOs.
However, fractional CFOs are ideal for many cannabis operations because these services give the business owner the capacity to scale up or down as needed. This freedom allows cannabusinesses the ability to overcome financial challenges like raising capital and cash management when needed. But it also helps with optimizing resources.
For example, your operation might need assistance from finance experts during the busier time of year. But when your growing business is having cash flow issues, you have the option to scale back the finance and accounting services for the time being.
Fractional CFO FAQ
What is a fractional CFO?
A fractional CFO is a finance professional who partners with small businesses and large-scale operations to offer financial services. In the same manner as a full-time team, fractional CFOs provide business owners accounting expertise and financial guidance.
But because these professionals are only available part-time, they help you pursue growth strategies when your needs arise.
Why should I choose a fractional CFO over a full-time finance team?
By hiring Northstar as your fractional CFO partner, you get access to experienced accounting and financial professionals at a fraction of the cost. But what’s more, the connections we have acquired by working with the cannabis sector are conducive to scaling your operations.
Rather than hiring a freelancer to handle your accounting, you have a team dedicated to your success. Our industry connections make it easy to obtain the financing and other services your growing business needs to scale.
Let’s say your hope is to build your company to the point you can offer stock options. Or perhaps you need help creating and implementing a financial strategy that will work for your operation.
Strategic planning is our bread and butter, and since we’re knowledgeable about cannabis nuances, we can act as your trusted advisor every step of the way!
How much does a fractional CFO make?
You’re probably wondering how much a fractional CFO earns. This varies from industry to industry, as well as how much time they dedicate to each company.
The beauty of the fractional CFO model is that the individual can also work with other businesses. This means that rather than being limited to one company, a fractional CFO can service other businesses on a part-time basis.
Many fractional CFOs will work on a project basis. However, at Northstar, we want to be your long-term CFO partner instead. This means we get to know your company, the people that make it great, and your plans.
Whether you hope to make an exit strategy a few years down the road or want to build something sustainable, we’re here to help with expert accounting and other financial services on a fractional basis. Our mission is to set your company for scaling its operations as your fractional CFO partners.
Why is a CFO a fractional?
So, why is a CFO a fractional CFO as opposed to a full-time accounting and finance expert? Some choose to become freelance CFOs for additional freedom. However, at Northstar, we believe that a fractional CFO stands to help most companies operating in cannabis with the specific challenges this industry presents.
Top companies operating in the cannabis space are overcoming obstacles daily. But what about the small business that’s just starting out? Or the small companies that have highs and lows throughout the year?
This is why we provide high-level fractional CFO services as opposed to full-time or interim CFO services.
Cash management is one of the most significant problems a cannabis business will face. But these operations still need a trusted advisor to lead board meetings, analyze current finances, and ensure exit strategies prioritized are on track in accordance with the company’s financial statements.
We want to make sure every cannabis business has access to a trusted advisor when a company needs a high-end CFO. General accounting is important, too. However, without specialization in the cannabis space, hundreds of millions of dollars can be lost as these organizations implement without the right guidance.
Fractional CFO Financial Strategy for Cannabis
The fractional CFOs at Northstar work exclusively with businesses operating in cannabis. We understand how financial forecasts and financial strategy should work for this space.
Financial modeling for the cannabis sector must consider the specific financial challenges of this industry. This, of course, includes all compliance-related issues that can come up.
Optimizing cash flow is especially important for this space. And for large-scale organizations managing multiple companies in this industry, operational strategies, maximizing shareholder value, and planning for exit strategies are all important considerations for maximizing profitability.
For a privately held company with diverse management projects, private equity funding could be essential to financing real estate and other large purchases. But other diverse management projects within the company might need accounting and other financial services, too.
Northstar’s Fractional CFO Service
As your fractional CFO, we can serve as your interim CFO between hires. But we want to become your strategic planning partners long-term!
As your fractional CFO partners, your success is our priority. Rather than bringing in a full-time Chief Financial Officer, you’ll have our professional team focused on accelerating growth with a proper cannabis-specific financial strategy.
With Northstar, you never have to worry about compliance-related risks. We remain vigilant in our data acquisition, ensuring we always have the right answer at the right time.
Looking for a part-time CFO to help your cannabusiness navigate this space? Northstar is here to guide you!
Contact us now to find out how our services will help your cannabis operation scale in this budding space.
A 2016 bill – the Medical Marijuana Regulation and Safety Act (MMRSA) – allows California to begin regulating the country’s oldest medical marijuana industry, which had been operating in a legal gray area. Now that these provisions are in place, medical marijuana businesses can operate with regulatory best practices in mind. But there’s a lot to understand as a business operator.
The state of California is working to make it easier for people who need medicinal cannabis by creating laws that allow dispensaries and other businesses involved with selling or growing medical cannabis more freedom regarding how they operate their business. These laws are also being passed to maintain some common-sense regulations within the state.
Nearly 20 years after Californians voted “yes” on Proposition 215 (1996) to make the use of pot medically acceptable under certain conditions, Governor Jerry Brown signed this legislation. It’s quite powerful, with a design that regulates an industry with an estimated annual value in the billions.
Between retail sales and related activities like transportation, cultivation, distribution, and testing services within his own jurisdiction. The new law went into effect on January 1, 2016.
But what exactly is the MMRSA?
In this article, we cover the ins and outs of the MMRSA. Everything you should know as medical marijuana business owners operating within state and local laws – including each licensing authority in charge of regulations – will be covered!
Operating a medical cannabis operation in California? Northstar is here to guide your success!
Contact us now to speak with one of our experts to learn how we’ll scale your operation in this budding space.
The Importance of Medical Cannabis in America
Medical marijuana is a treatment that has substantial evidence that shows it works medicinally to improve the quality of life for sick and chronically ill patients.
Unfortunately, the morals of some people have hindered scientific progress. But even with this being the case, states throughout the country have implemented laws to ensure access to marijuana for medical purposes.
At this point, the medical marijuana industry needs more data highlighting the plant’s efficacy in treating various ailments. However, the current research reveals that using the plant can help some patients.
The History, Pharmacology, & Implications of Medical Cannabis
Medical marijuana regulation came long after the plant became commonplace for personal medical treatment. People began using and distributing medical cannabis as far back as 2900 BC when the Chinese emperor Fu Hsi recorded it as a popular treatment for public health that contains both aspects of yin and yang.
Delving into some research on how marijuana is used from a public health aspect, every content – besides Antarctica – possesses a documented history showing its application.
These days, in the United States, commercial medical cannabis activity has become somewhat commonplace. But it wasn’t always this way.
Long before the stigma, Jamestown, Virginia passed a law that required farmers to grow cannabis – without requiring cultivation licenses, of course. One of the founding fathers, Thomas Jefferson, is known to have grown, too. But eventually, Massachusetts became the first state to ban cannabis and cannabis products in 1911.
While there was some concern about controlled substances getting in the wrong hands, some people realized that there was money to be made off of cannabis by making it illegal – even for medical purposes.
Not long after it became illegal, infamous propaganda films were released to instill fear into the American public. But none is more infamous than Reefer Madness.
By 1937, illegal possession was a crime, and the first documented conviction for selling marijuana happened under United States Federal Law.
The propaganda developed a stigma surrounding the plant. But people continued to use it recreationally and for healing purposes, despite the government refusing to permit cultivation and sales.
Fast forward to the present and we see how much progress has been made with medical marijuana regulation and legalization through the Medical Marijuana Regulation and Safety Act.
Medical Cannabis Regulation: Why?
Medical marijuana regulation is essential for this industry. Without these state and local governments’ regulations in place, it’s nearly impossible for law enforcement officers to do their jobs effectively. Ultimately, a local government will have the last say in how these businesses can operate in an area.
Similar to pharmaceuticals, patients need to be assured of the quality and safety of products they’re receiving. A new law, which has just recently gone into effect this year, is set out to ensure that protection.
While a local ordinance can ensure law enforcement handles consumer affairs with a health and safety code in place, localities can still ban medical marijuana cultivation and sales. However, deliveries are usually still permitted to patients.
State and local agencies have been tasked with medical cannabis regulation. But in California, the Medical Marijuana Regulation and Safety Act directs the California department (Department of Cannabis Control) is responsible for handling consumer affairs for personal medical use marijuana products and enforcing the health and safety code.
What is the MMRSA?
The MMRSA is also known as the California Medical Marijuana Regulation and Safety Act (MMRSA). Through this legislation, California’s local government established comprehensive regulations and standards to govern almost all aspects of California’s medical cannabis industry. From taxation to licensing, quality control, packaging, shipping, and standards for cultivation, the MMRSA is the go-to regulation and safety act for insight into how medical cannabis businesses must operate. This, of course, includes manufacturers and distributors of medical cannabis products.
For medical marijuana cultivators, the licensing authority also sets a maximum allowable size for cultivation operations that aligns with the type of license obtained. The law also prevents vertical integration for licensees’ businesses by only allowing operations to hold licenses in up to two separate categories.
The regulatory California department also places quality control restrictions on adult use and medical marijuana. But these restrictions are currently being developed.
The California legislature limits distributors on the content of cannabinoids, contaminants, microbiological impurities, and other compounds. But at this point, the standards have not been fully developed by the California Department of Public Health. The state also includes a provision for a new fee for testing that the distributors must charge to cover any new taxes that might be imposed on these controlled substances in the future.
AB 266 also establishes a set of written laws that highlight which actions performed by licensees are permitted by a state license and local government. This means that these actions are no longer prohibited under state law to offer the licensee protection from legal repercussions. It also offers provisions for older facilities that were in compliance with the laws in place on or before January 1, 2018. This makes it so these facilities can continue their operations until their licenses are either approved or denied.
AB 266 also has rules in place to regulate cannabis deliveries that demand documentation for each delivery. The licensee must maintain a physical copy of their delivery requests during deliveries. This needs to be made available any time a law enforcement officer requests it, as required by the California licensing authority.
Furthermore, all dispensaries offering medical cannabis or medical cannabis product delivery must have their employees carry a copy of the dispensary’s license, as well as their government-issued identification.
Deliveries are only permitted by licensed transporters to qualified patients and dispensaries in cities and counties that do not prohibit deliveries by local ordinances.
However, equally important is the fact that deliveries can be taxed by the local jurisdiction. The law also offers some protection for patient and caregiver privacy, giving them confidentiality for their names and medical conditions.
The California Department of Pesticide Regulation also has the responsibility to develop the standards for pesticide regulation in marijuana cultivation. This California department ensures that anyone with a state license to grow medical marijuana does so without threatening public health.
The DFA also created a track and trace program for all adult-use and medical marijuana plants at cultivation sites. It also put civil penalties in place for cultivation operations that violate any of these provisions. However, qualified patients can be exempt from the track and trace program if they cultivate their own plants in an area that’s less than 100 square feet for personal medical use. A primary caregiver who has five or fewer in their patient collectives is allowed to grow plants in a proposed location of up to 500 square feet, as well.
Thus, primary caregivers must be wary of how many plants they grow under the Compassionate Use Act, particularly if they do not operate a licensed facility.
Senate Bill 643 also outlines qualifications for licensing. This includes proof of local approval. Applicants must also undergo a DOJ background check at a Public Live Scan Site. These qualifications allow for-profit entities to operate.
New cultivation and dispensary facilities cannot be located in school zones. They must be at least 600 feet away from schools.
Senate Bill 643 also includes several provisions regarding attending physician recommendations. However, these provisions do not significantly impact or impair a patient’s ability to access medicinal marijuana. The Medical Board must consult with the California Center for Medicinal Cannabis Research to develop the medical guidelines for medicinal marijuana recommendations, as well.
Physicians are not allowed to make medical recommendations to patients if the physician or a family member has a financial interest in a licensed medical cannabis facility. Physicians also must include a warning notice telling patients that medical marijuana is still a controlled Schedule I substance at the federal level.
Organic Standards for Cannabis Production Through Senate Bill 643
Through the Medical Marijuana Regulation and Safety Act, the following information outlines organic regulations for medical cannabis products:
(a) The CDFA licensing authority for medicinal marijuana was also tasked to make available a certified organic designation and organic certification program for medical marijuana no later than January 1, 2020. However, it must be allowed under federal law, along with the National Organic Program and Article 7 of Chapter 5 of Part 5 of Division 104 of the Health and Safety Code.
(b) The bureau can establish appellations of origin for all cannabis grown in California.
(c) It’s illegal for medical marijuana to be marketed, labeled, or sold as grown in a California county if the medical marijuana wasn’t cultivated in that county in accordance with the local ordinance.
(d) It is unlawful to use the name of a California county in the labeling, marketing, or packaging of medical marijuana products unless the product was grown in that county.
Vertical Integration Under MMRSA
The MMRSA established the Bureau of Medical Marijuana Regulation and formed the state’s system for medicinal marijuana business licensing. Later on, the law was changed through several small bills and renamed the Medical Cannabis Regulation and Safety Act (MCRSA). After the state legalized adult-use marijuana, it combined licensing structures for medicinal and recreational operations through the Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA).
Ganjapreneurs interested in operating for-profit medical marijuana businesses in California need to get the right license. The license must be for a specific niche in the cannabis sector. For example, manufacturing, cultivation, testing, distribution, etc.
Some people would like their operations to work at multiple stages in the supply chain. For instance, a dispensary might want to grow and distribute marijuana products themselves. However, specific rules and complex licensing demands in place allow these operations to work at several levels in the distribution chain.
Limitations for Vertical Integration Under MCRSA/MMRSA
The MCRSA allows businesses to apply for 17 types of commercial licenses, as discussed above. The MAUCRSA now permits at least 20 types of licenses with each license focused on a certain stage of production.
Businesses interested in operating at multiple stages of production need to hold all of the right licenses to operate vertically. However, the general rule of the MCRSA is that licensees can only hold licenses in up to two different license categories.
Vertical Integration Under MAUCRSA
As of January 1, 2018, the MAUCRSA changed Cali’s marijuana licensing structure. These alterations combined medicinal and non-medicinal licensing structures to revise various MCRSA provisions. Through the MAUCRSA, some restrictions regarding vertical integration were repealed. Thus, single licensees are now allowed to own multiple licenses with some restrictions still in place.
Even though single individuals are now able to hold more than two licenses, they have to operate as separate and distinct businesses. Furthermore, some combinations are still prohibited.
Since testing sites can’t have other types of licenses, this causes a dilemma for some. Large-scale commercial growers are also not allowed to have a distributor license or a micro-business license. Vertical integration is also something some local city and county ordinances can ban.
How Licensing Works Under MMRSA
Businesses that have both been in operation and in good standing with their localities before 2016 have priority to receive their licenses.
Applicants must obtain a permit from their city or county before obtaining a license from the state of California before they can operate a cannabis business. Both are necessary to comply with the new commercial cannabis laws. For example, state licensure still requires a local permit, just as someone with a locally granted permit must have state licensure.
Even though local jurisdictions can change their ordinances to allow or ban medical marijuana licenses for business operations, all of these localities must still adhere to the minimum standards established by the MMRSA and the state of California.
The law creates seventeen types of commercial licenses. Whether an operation can get one of these licenses depends on if the cannabis is cultivated indoors or outdoors, as well as the size of the operation and the amount of medical cannabis cultivated.
Some limitations exist regarding the types and number of licenses that one licensee can hold. Generally speaking, the new laws allow licensees to only hold a state license in up to two separate license categories. Equally important to consider is the fact that a licensee cannot hold an ownership interest in real property, personal property, or any other assets connected with another license category.
Licensees also cannot be licensed to sell alcoholic beverages as a retailer.
Licenses are valid for a year from the date they’re issued. These licenses must be renewed annually for the licensee to continue lawful commercial cannabis operations.
Businesses that were previously granted permission to cultivate, manufacture, and dispense cannabis or cannabis products under one permit may receive an exception. Also important to note is that there are several requirements in place. The most important of these demands is that the business must have continuously complied with local ordinances without interruption before July 1, 2015.
Safety Act Compliance
Both a state license and local permission are essential for cannabis operations to comply with the MMRSA. But changes to the rules will continue, and it’s essential to remain diligent in how these alterations might impact your operation.
This is why it helps to have a team monitoring the legislative changes throughout California state and the locality in which you operate.
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