The Medical Marihuana Facilities Licensing Act, Public Act 281 of 2016 is an entirely new law that creates five types of licenses relating to medical cannabis, designed to regulate and control a commercial medical cannabis industry. These regulations are created to ensure both safety and legal access for registered medical cannabis patients obtaining cannabis from a licensed provisioning center. Registered patients will soon have three options to choose from to obtain medical cannabis in Michigan:
- Patients can cultivate their own medical cannabis (up to 12 plants);
- Patients can assign a primary caregiver to cultivate medical cannabis on their behalf (up to 12 plants);
- And soon, a registered patient, or that patient’s primary caregiver, can obtain medical cannabis from a provisioning center licensed under the Act.
The new laws create three classes of growers: people who can grow up to 500 plants, up to 1,000 plants or up to 1,500 plants. They also create five classes of licenses – those for growers, testing facilities, transporters, the seed-to-sale tracking and dispensaries. Communities can decide whether and where they’ll allow dispensaries to operate and charge an annual fee of up to $5,000 per dispensary.
Michigan Cannabis Licences
Class A, B, or C Grower – “A licensee that is a commercial entity located in this State that cultivates, dries, trims,
or cures and packages cannabis for sale to a processor or provisioning center.”
Class A: 500 plants – Class B: 1,000 plants ‐ Class C: 1,500 plants
Processor –“A licensee that is a commercial entity located in this State that purchases cannabis from a grower
and that extracts resin from the cannabis or creates a cannabis infused product for sale and transfer in
packaged form to a provisioning center.”
Provisioning Center – “A licensee that is a commercial entity located in this State that purchases cannabis
from a grower or processor and sells, supplies, or provides cannabis to registered qualifying patients, directly
or through their registered primary caregivers. The term includes any commercial property where cannabis is
sold at retail to registered qualifying patients or registered primary caregivers. A noncommercial location used
by a primary caregiver to assist a qualifying patient connected to the caregiver through the marihuana
registration process of the Department of Licensing and Regulation in accordance with the Michigan Medical
Marihuana Act will not be a provisioning center for purposes of the Licensing Act.”
Secure Transporter – “A licensee that is a commercial entity located in this State that stores cannabis and
transports it between cannabis facilities for a fee.”
Safety Compliance Facility – “A licensee that is a commercial entity that receives cannabis from a cannabis
facility or registered primary caregiver, tests it for contaminants and for tetrahydrocannabinol (THC) and other
cannabinoids, returns the test results, and may return the cannabis to the facility.”
Taxes and Fees
The laws provide for a state tax at the dispensary level of 3% on gross receipts, of which 30% will go to the state general fund and much of the balance will go to local governments and police departments to help cover the cost of enforcement.
License fees will support an extensive bureaucracy that is expected to cost the state about $21 million a year, including 113 full-time state licensing employees, 34 employees with the Michigan State Police to do background checks on applicants, and $550,000 to the Attorney General’s Office for legal expenses.
For the most part, licensing fees haven’t been set yet, except that the state can charge no more than $10,000 per license for the class of growers who cultivate up to 500 plants.
Michigan Cannabis Industry Projections
The medical cannabis business is projected to generate revenues of more than $700 million, and if a ballot proposal goes to voters in 2018 and the market is opened for recreational use, Michigan could also be top states for cannabis companies to target. It is expected Michigan’s market to reach $1.3 billion in 2021.
Michigan Recreational Cannabis
On May 5, the Michigan Coalition to Regulate Marijuana Like Alcohol, submitted language that would create a system allowing for the legal cultivation, sale and regulation of the substances. If enough signatures are gathered, the hope of the organization is for the ballot initiative to be on the November 2018 ballot.
A campaign to put a recreational marijuana legalization initiative before voters in Michigan got the green light from state election officials to start collecting signatures.
The Coalition to Regulate Marijuana Like Alcohol announced that the state board of canvassers signed off on its initiative language, clearing the way for the group to start gathering the 252,523 signatures of registered voters that it needs to make the 2018 ballot. The group has 180 days in which to submit at least that many to qualify for the ballot.
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