1. No matter what state you are in, if you want to know
how to open a collective, you first need to know that
dispensaries are formed as either collectives or
cooperatives and that there are major differences
between them and your choice of formation affects
how you operate your dispensary and the legality of it.
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2. By far, collectives are the most widely used choice The idea behind a
collective is that you as the Dispensary Owner (You also must be a
qualified, legal medical patient yourself) are teaming up with other
patients to collectively form an establishment that cooperates to
exchange and donate marijuana amongst each other Members of the
collective may be reasonably compensated monetarily for their time and
efforts in producing and transporting the marijuana Within a collective,
the production is done by the able members of the collective and
distribution is back to them Nothing is "bought from anyone" it all belongs
to the members
3. If you want to know how to open a collective or cooperative, know this
also - It's been said that Collectives don't have the tight
definitions that Cooperatives have around them For instance Collectives
are not privately owned, they are owned and worked by members of the
group (collective) and no single member 'owns' the production
there of The old communistic axiom of "Each as they can; each by their
needs," would be a good line to follow to see if an entity is a collective
Cooperatives (on the other hand) are groups of people who all own their
own land, (production sites) and sell their production to a central market
or hub A Cooperative is an entity that buys medical cannabis from
members (at given prices: 1,800-6,000 a pound) then resells it tacking on
their Cost Of Operations (COO) also looking at current street prices to
dissuade resell on the black market
4. A Collective is an entity that produces its own cannabis then provides it
to its membership for Cost of Production (COP) and Cost of Operations
(COO) (staffing et al) Prices are totally reflective of the actual COP
& COO vs any outside modifiers Membership and distribution is in
a closed circuit and monitored in a collective model Applying this
definition, a collective should be an organization that merely facilitates the
collaborative efforts of patient and caregiver members - including the
allocation of costs and revenues
5. As such, a collective is not a statutory entity, but as a practical matter it
might have to organize as some form of business to carry out its activities
The collective should not purchase marijuana from, or sell to,
non-members; instead, it should only provide a means for facilitating or
coordinating transactions between members Collectives and
cooperatives should be organized with sufficient structure to ensure
security, non-diversion of marijuana to illicit markets, Edit PDF text and
compliance with all state and local laws Regardless of the organizational
structure, a medical cannabis collective should operate in a "not-for-profit"
manner
6. Not-for-profit operation describes the behavior of a business or
association that is not operated for a commercial purpose, or to generate
profits for its owners Any business, regardless of its formal structure,
can operate in a not-for-profit fashion by reinvesting excess revenue
(after salaries and other overhead) in services for members, advocacy for
patients' rights, or other noncommercial activity Remember when
you know how to open a collective properly- you can be salaried and if
you are providing the marijuana, you can also still be reasonably
compensated for your time and efforts
