new laws
Increased medical marijuana fees have Colorado businesses fretting
Despite some public opinions, Colorado medical marijuana dispensary owners have struggled to make ends meet. The businesses must comply with a series of strict regulations and requirements that make selling legal marijuana less lucrative as one might think.
A recent Colorado Springs City Council decision has dispensary owners and operators in the area stressing over whether or not they will make it through to the next year. Several have even considered closing their doors as an alternative to filing for bankruptcy.
The unanimous decision by the council to raise fees on medical marijuana business operation by imposing a $2,200 charge is the first of several proposed charges that could follow. The council also discussed extraneous charges of $1,800 that dispensary owners would be forced to pay.
The fee hike has several medical marijuana advocates reeling as they say it is a direct attack on type of business which ironically provides a large amount of revenue for the state. “I think this new fee is ludicrous,” said the President of Coloradans for Cannabis Patient Rights. “These businesses are barely breaking even as it is.”
According to the Colorado advocate, if the businesses are forced to close or go into serious debt as a result of the decision, it could have an effect on the area’s economy. An effect, that she claimed, the city failed to consider in their deliberations.
City officials reported that the new Colorado industry is in a “precarious situation” due to the fact that marijuana is still illegal on the federal level. One council-member said that the city is still figuring out how to handle the industry at all. Operating the industry from the city’s end costs a lot of money, claimed the council-member in support of the increased fees.
Source: The Colorado Independent, “Colorado Springs jacks medical marijuana fees,” Beatrice Santa-Wood, 5 July 2011
Bankruptcy Filings Rose 9 Percent in 2010, Experts Predict Reduction in 2011
Personal bankruptcy filings in 2010 hit one of the highest recorded numbers; approximately 1.53 million people filed for bankruptcy this past year, a 9 percent increase from the previous year. While 9 percent is the nationwide average, some areas of the country, mostly situated in the southwest and southeast, experienced a 24 or 25 percent increase. The bankruptcy rate for 2010 was the highest it has been since the restructuring of the law in 2005.
The bankruptcy revision was structured in a way that legislators hoped would reduce the amount of debt forgiven in the process. Law makers hoped that the revision would force more people to choose filing under Chapter 13, a process that encourages workouts and new repayment plans instead of Chapter 7 where debtors forfeit their assets. According to the American Bankruptcy Institute, only one third of debtors chose to file under Chapter 13.
According to surveys conducted by the nonprofit Institute of Financial Literacy, there has been an increase in the amount of middle-class families making over $60,000 per year or have obtained college degrees who have filed for bankruptcy.
Experts have predicted a reduction in 2011 of the number of personal bankruptcy filings. The prediction is based upon the tightened lending procedures and the fact that people simply are not borrowing right now. “[When] borrowing’s down,” said one law professor, “there’s less of a reason for people to take the legal step of filing for bankruptcy.”
As we discussed in our prior post, other changes to the Chapter 7 filing procedures could also have an effect on the number of personal bankruptcies filed in 2011.
Source: The Wall Street Journal “Bankruptcy Filing Leapt 9% Last Year” Sara Murray1/4/11
New Year Brings New Requirements for Chapter 7 Bankruptcy
New Years Day is a day for new resolutions and fresh starts after the mistakes of the past year have been forgotten or forgiven. While individuals across the nation make promises to themselves about changes they plan to make in their daily lives, the New Year is also a time for the federal government to make changes of their own.
This beginning of 2011 has been no different from the beginnings of years past, and the federal government has announced the new changes that were made to bankruptcy law. Specifically, changes were made to the rules governing the filing of personal bankruptcy under Chapter 7. These changes, in this economy, make it even more vital to seek out the assistance of an experienced bankruptcy attorney when considering the future of your financials.
Where a chapter 7 bankruptcy could generally discharge all personal debts through a liquidation of the assets owned by the debtor, the same individual may not even qualify for Chapter 7 if their income is high. Also, those who have already filed for bankruptcy must now wait at least eight years before doing so again. The changes may force individuals who once considered filing to seek alternatives to bankruptcy in order to lower their debt including creditor workouts that restructure previous payment plans.
Experienced attorneys remains abreast of new changes in the law and can help someone struggling with debt relief navigate the confusing rules and regulations that govern bankruptcy, and while creditors want to get paid, an attorney can make sure that repayment plans protect the individual’s interest and suit their needs.
Source: Mortgage11.com “New Bankruptcy Laws: Chapter 7 and Chapter 13 Bankruptcy Information” 1/4/11