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Marijuana Law Updates / Marijuana Law Analysis
October 23, 2017 no comments

Michigan Medical Marijuana Licensing Update

63% of voters approved a medical marijuana measure that legalized marijuana in Michigan. Michigan’s original law established regulations for patients and caregivers but did not establish regulations for the businesses that made medical marijuana available to them.

In an effort to fill in the gaps in the initial law, lawmakers in Michigan passed three bills that will reform the state’s medical marijuana program and provide for the licensing and regulation of medical marijuana businesses.

The state offers applications for five licenses:

  • Growers
  • Processors
  • Testers
  • Transporters
  • Dispensaries

The Michigan Medical Marijuana Licensing Board began awarding licenses within the first quarter of 2018.

Under the new statutory scheme, local municipalities will be allowed to opt in and adopt a local ordinance or opt out and determine not to allow medical marijuana to be grown or sold in their municipality. Aside from receipt of local approval and the applicant will need to engage in a two-step process for approval:

  1. The first is a pre-qualification application, that will allow the state to do a background check on the individual and business, that will include among other items submittal of state-approved identification and percentage of interest for all other persons or businesses with an interest in the license; documentation on type of business organization, financial information, regulatory compliances, criminal history check with fingerprinting, litigation history and tax history company business registration documents including operating agreement or by-laws, prior or existing regulatory licenses, income information bankruptcy history, and tax compliance certificates.
  2. The documentation that must be included in the second step of the process pertains to the actual license and includes the type of license, proof of the municipal approval and copy of its medical marijuana ordinance; plans for technology, staffing, inventory, security and record keeping plans; the medical marijuana facility’s floor plans and layout; and proof of insurance, bond or securities for the actual facility.

Recommended capitalization requirements range from $150,000 for a dispensary to $500,000 for medical marijuana grow operation for up to 1,500 plants which means you will need to demonstrate up front the necessary financial backing to obtain licensure which may have the effect of excluding smaller players from the marketplace.

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