Judge rules DHHS can impose fee on medical marijuana providers

A small bag of marijuana rests on top of a medical marijuana provider form in Pittsfield in 2010.  A state judge has ruled that the Maine Department of Health and Human Services can impose fees on people who provide medicinal marijuana.
John Clarke Russ | BDN
A small bag of marijuana rests on top of a medical marijuana provider form in Pittsfield in 2010. A state judge has ruled that the Maine Department of Health and Human Services can impose fees on people who provide medicinal marijuana. Buy Photo
Posted March 16, 2014, at 9:05 a.m.

ROCKLAND, Maine — A state judge has ruled that the Maine Department of Health and Human Services can impose fees on people who provide medicinal marijuana.

Justice Andrew Horton ruled Thursday in Knox County Superior Court that the fees on marijuana caregivers and dispensaries could be set by the agency rather than having to go through a formal rule making process and approval by the Maine Legislature.

The Washington man who challenged human services in court blasted the judge’s ruling.

“This means the government doesn’t have to follow the law. There is no justice when the rule makers can break the law,” John Stewart of Washington said on Saturday.

Stewart, who is a marijuana caregiver, filed a court appeal in November 2012 that argued that human services exceeded its authority by imposing fees of $900 in 2011 and $900 in 2012. The Washington resident also argued that the fee — which was $300 per patient — was excessive.

Stewart had asked the court to block the state agency from enforcing the marijuana caregiver registration fees. He also asked the court to order DHHS to return the $1,800 he had paid for the two prior years and asked that the agency pay his court and attorney fees.

Justice Horton found that the Maine Medical Use of Marijuana Act, adopted by the Legislature, allows the fees to be set as routine technical rules, which does not require the more formal process that includes subsequent votes by the Legislature.

“The intent of the Legislature could not be clearer,” Justice Horton ruled.

Stewart, however, said he strongly disagrees with the ruling.

He said the Maine Administrative Procedure Act — an earlier law approved by the Legislature to curb the power of bureaucrats — is clear that if there are no fee range or cap in any subsequent law that the setting of a fee will a major substantive rule that requires hearings and a legislative vote. He said the marijuana law does not have a range or cap for fees.

The administrative procedure act was approved in 1995 and requires substantive rules to be reviewed by a legislative committee and then by the full Legislature.

Justice Horton stated in his ruling, however, that the marijuana act allowed DHHS to set fees as technical rules.

Stewart said the ruling is also another example of how government is not supportive of marijuana caregivers, who provide more than 1,000 jobs in the state.

He said he and other marijuana caregivers must charge sales tax on the marijuana that they sell to patients with doctors notes and then turn that money to the state. He said prescription medication is not taxed.

Caregivers are not allowed to deduct equipment purchases from their income taxes as other businesses are allowed, Stewart pointed out. He said caregivers are also limited to hiring one employee. He said lifting that instruction could create more jobs in a state that needs them.

He said the judge’s ruling allows bureaucrats to run amok and make decisions without proper oversight.

Stewart said he was not sure about an appeal of the ruling to the Maine Supreme Judicial Court since he was not aware of the ruling until being notified by the Bangor Daily News on Saturday afternoon.

He also criticized the length of time it took for the judge to issue his ruling, 16 months after the appeal of the fees was filed.

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