LAPEER, Mich. – The chaos of cannabusiness continues as Michigan’s labyrinthine legislation is keeping applicants in the proverbial weeds. Since Gov. Rick Snyder signed regulatory legislation nearly two years ago, Michigan has yet to license a single medical marijuana business, illustrating and underlining the cloudy and convoluted system in which would-be entrepreneurs are finding themselves mired. This is not to say that people aren’t still trying, as more than 400 applications have been submitted for pre-approval. Now, with the bottleneck of applications and paperwork reaching a breaking point, Michigan’s medical marijuana regulators have scheduled two more meetings to clear up the gridlock.
The two meetings have been scheduled for April and May and are considered critical for the 215 cannabusinesses across Michigan nearing their deadline on June 15, before their temporary operating status expires. According to the Detroit Free Press, if these applicants do not receive a state license and approval from the communities that have passed ordinances by then, the operations will be shuttered indefinitely. It remains to be seen exactly how effective the two extra meetings will be in expediting the licensing process, but applicants remain optimistic.
As it stands, Michigan has one of the largest medical marijuana programs in the nation – second only to California in terms of patient numbers. The state’s medical marijuana business is expected to generate $711 million in sales and $21 million in tax revenues. According to Forbes.com, Michigan’s program also received one of the highest grades from Americans for Safe Access.
“If Michigan makes its emergency rules permanent, it will have one of the strongest program[s] in the country,” reads the report.
Right now, the medical marijuana market is operating on temporary rules that will expire in June. Application submissions began on Dec. 15 and background checks on the people involved in those businesses are taking longer than anticipated, said Andrew Brisbo, director of the state’s Bureau of Medical Marijuana Regulation.
It’s been just over a year since the Michigan legislature passed a series of bills creating the licensing and regulatory framework for medical marijuana, called the Michigan Medical Marihuana Facilities Licensing Act (MMFLA), expanding upon the legislation outlining the rules and regulations for the use of legal medical marijuana, which was overwhelmingly approved by Michigan voters back in 2008. Enforced under the Dept. of Licensing and Regulatory Affairs and the Medical Marijuana Licensing Board, the aim of this act is to protect patients and to implement fair and efficient regulations.
The signing of the MMFLA significantly increased the types of medical marijuana facilities permitted under state law and established a licensing plan that’s very similar to that of liquor licenses. The act creates five types of licensed medical marijuana businesses — growers, processors, secure transporters, testing facilities and dispensaries. However, before the state’s Department of Licensing and Regulatory Affairs (LARA) will consider an application for any of the five licenses in a community, the community must opt in to the provisions of the MMFLA.
Many local governments were less than eager to welcome marijuana-related businesses into their communities, citing a host of reasons. Many municipalities either voted to opt out or did nothing, which, as of Dec. 15, was the same as opting out.
Some communities accept medical marijuana use for compassionate reasons, including but not limited to terminal illnesses. And many believe that the new Facilities Licensing Act will better enable, or simplify, the spirit and actual practice of the patient-caregiver relationship. Other communities may be responding to a real demand or a broad majority support locally for providing medical marijuana facilities and business opportunities. And, perhaps most important to concerned municipalities, the introduction of cannabusinesses may represent a significant revenue source.
Within the City of Lapeer, which opted in to the provisions of the MMFLA, applicants for six medical marijuana dispensary licenses will be reviewed on a merit-based system drafted by the city clerk’s office and legal counsel. The city will begin accepting applications for medical marijuana business licenses today, Monday, April 2. Though dispensaries will be limited to a half dozen, the Lapeer City Commission is not limiting the number of medical marijuana grow facilities that can locate in the city, nor are there restrictions placed on the number of processors, testing facilities or secure transporters that may operate in the city.
By conservative estimates, there are said to be at least 20 to 30 persons interested in obtaining a dispensary license in Lapeer. Applicants will have 15 business days (until April 20) to submit their application in person or via the U.S. Mail or other parcel carrier. No applications by email or facsimile will be accepted. In-person applications at Lapeer City Hall will be accepted between the hours of 9 a.m. and 4 p.m. Applications received after April 20 will be date stamped and added to a waiting list until after the first initial evaluation of all the applications have been completed.
The next step in the process will entail a three-person panel (yet to be assigned by the city commission) to begin the review and scoring process of the merit-based applications. This business will be conducted starting April 23 and will last another 15 business days until May 11. In the event of a tie between the top-scoring applicants to satisfy the threshold of six license winners, those applicants will be entered into a random drawing. Should, for any reason, a completed application be denied by the City of Lapeer for a dispensary license, the applicant may initiate an appeal process detailed in Chapter 68 of the city’s general ordinances before the next applicant listed in sequential numerical order on the waiting list will be considered.
Lapeer City Manager Dale Kerbyson said that the three-person panel will be selected based on their community standing and whether they are “above reproach.” The three individuals will assess, score and rank each of the 65 items on the merit application to receive a maximum point value of one. The highest overall total score is 65 points in the merit-based scoring system. The applicants with the six highest overall scores would be eligible for a dispensary license provided all other conditions under the city’s and State of Michigan’s statute and regulatory requirements are met.
“Lapeer’s merit-based approach to allowing provisioning centers in the city will call an infinite number of problems,” said Lapeer-based attorney and marijuana activist Bernard Jocuns. “It appears as though the city is only concerned with whomever has the most resources, meaning that many people who wish to invest in the community will be left out. There is no reason some of these individuals should not be considered.
“Furthermore, if the city utilizes this subjective system, they are practically welcoming a lawsuit,” Jocuns continued. “The inevitable lawsuits will cost the city time and resources that easily could have been avoided if there had been a reasonable resolution reached by the city commission. Unfortunately, there seems to be a lot of tunnel vision going into the making of their decision to limit provisioning centers.”
Meanwhile, nearby, Bay County has already begun seeing dispensaries materialize, after awarding more than two dozen dispensary permits. The provisioning centers have opened their doors early, under the state’s emergency rules, and are serving a growing number of patients throughout the area. Bay County, which is comparable to Lapeer County in size and population, is poised to become a medical marijuana hub for the state, approving a vast number of license applications for a broad spectrum of different cannabusinesses, including a number of enormous grow facilities.
Bay County Executive Jim Barcia says that he has no problem whatsoever with his county becoming a mecca for mega growers. Three additional towns within Bay County – Kawkawlin and Gibson townships and Bay City – have also approved ordinances with generous numbers of licenses available.
“We’re getting a pretty substantial amount of contact from individuals who are interested in investing in Michigan for grow operations,” he said, adding that if full legalization is approved in the November election, those early communities approving ordinances will have a head start on a billion-dollar market.
The City of Lapeer, with a limit of six dispensaries, is unlikely to see the same kind of development in terms of its cannabusinesses, though a number of industrial sites in the surrounding areas have become targets for large grow operations. Also, even after opting in to the MMFLA provisions, city residents have expressed uncertainty and apprehension regarding dispensaries, citing unfounded claims of attracting a criminal element.
However, regulations for any and all cannabusinesses are myriad and leave little room for exposure to crime or delinquency. Along with state and federal laws, all licensees will be required to comply with the following:
- No drive-through dispensaries will be allowed, nor will marijuana sales through the mail.
- Any change of location for a medical marijuana facility will have to go through the licensing process again, including the $6,000 application fee and the imposition of the regulatory assessment, which ranges from $10,000 to $48,000
- Every marijuana-infused product must have a label that includes the amount of THC in the product and be properly labeled with the state’s medical marijuana logo.
- If medical marijuana is being grown outside, it must be enclosed by fences or other barriers that block the view of the plant.
- Dispensaries cannot sell alcohol or tobacco products and can’t allow doctors to examine or provide medical marijuana cards to individuals at the dispensary.
- Dispensaries can sell medical marijuana to both qualified card holders and visitors from other states where medical marijuana has been legalized.
- Drivers for secure transport companies must have chauffeur licenses and always work in teams of two, with one person remaining in the vehicle at all times.
For more information regarding license applications, regulations, requirements and deadlines, or to apply for grower, processor, secure transporter, safety compliance facility or provisioning center businesses, visit www.ci.lapeer.mi.us or www.jocuns.com (810) 245-8900. Jocuns Law.