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Michigan News - April 2019

Gov. Gretchen Whitmer abolishes the medical marijuana licensing board 

The Governor's decision comes in response to the board’s previous struggle to execute
decisions in a timely manner, which resulted in the closure of over 70 provisioning centers across the state this past January. As a result of these closures, thousands of Patients statewide suffered with limited access to their medication. "This executive order will eliminate inefficiencies that have made it difficult to meet the needs of Michigan’s medical marijuana patients,” Whitmer said. 

Shelly Edgerton, the former director of LARA approved of the Governor's decision and said "The volunteer board took on a monumental lift to get this program going, but in the short time frame the program has been running, we have not seen the expected volume of licensees entering the market,” she said. “With this executive order, the licensing process will be more efficient and allow more applicants into the space."

The licensing board was created in response to the laws passed by Legislature in 2016 in order to regulate and tax the medical marijuana market, and is comprised of volunteers. The board has been under heavy scrutiny since 2018 due to inconsistent decisions, and not executing licenses in a timely enough fashion. There are currently only 105 licensed facilities, including 31 growers, 11 processors, 54 dispensaries, 4 testing labs and 5 transporters, whom have paid their state regulatory assessments, have actually been awarded licenses, and are currently operating.

Before issuing the executive order, Whitmer reached out to the leadership in both the house as well as the senate to ensure that the state legislature was not going to attempt to veto the order. The board will be abolished effective April 30th, and a new umbrella entity will be created in its place, the Marijuana Regulatory Agency. This agency will oversee both the medical marijuana market, as well as the recreational market. 

New marijuana proposal may change the game

The Governor isn’t the only one taking action against the inconsistency and slow pace of the marijuana board, a group of people from various cannabis related businesses have banned together to draft a new legislature proposal that they hope will completely change the game. The proposal will face a hard battle, as parts of it will require a supermajority vote, but if enacted could mean a total reform of cannabis regulation in Michigan. The groups that are involved in developing the bills are the Florida-based Minorities for Medical Marijuana; Cannas Capital, a Muskegon insurance and investment agency that specializes in cannabis businesses; Michigan Economic Stimulus Fund, a Kalamazoo-based cannabis consulting firm; the Lake Newaygo County chapter of the NAACP, and Banks & Company, which has a number of marijuana business clients. 

So what exactly does this new proposal entail? Well for starters, it would make the “gifting” of cannabis illegal, reimpose the 3% excise tax on medical marijuana that ended in March of this year, and would also require that anyone growing their own marijuana to register any heavy equipment that they use with their local community. Additionally, the proposal would also fundamentally change the caregiver program that has been in place since 2008, allow unlicensed dispensaries to remain open through the end of the year, and also allow for dispensaries to begin immediately selling cannabis recreationally. “We’re not trying to circumvent how recreational will operate,” said Eric Foster, a consultant with Banks & Company  “We’re just trying to accelerate the market and address some of the concerns from local government.”

The organizations do have one potential sponsor in the legislature, and are actively looking for others to join. State representative Ronnie Peterson, D-Ypsilanti, has also met with the group, but stated that there are other areas that need to be addressed as well that are not included in the initial plan. In reference to the fact that the cannabis industry is almost exclusively done in cash he stated “How do the communities benefit from these businesses beyond the taxes? And we still have no legislation dealing with banking and community reinvestment programs."

Work group for determining the recreational cannabis regulations is officially in place

Michigan lawmakers recently announced that they have chosen 57 individuals to help design the recreational cannabis regulations that were enacted in December 2018. The group was designed to address four regulatory topics, consisting of;

  • Licensees who are already licensed under the Medical Marihuana Facilities Licensing Act and are interested in entering the adult-use marijuana market.
  • Municipalities that are considering allowing licensed adult-use marijuana facilities in their community.
  • Attorneys who represent marijuana establishments who have an interest in the adult-use market.
  • Individuals or businesses interested in participating in the adult-use market as either a future licensee or a consumer of adult-use marijuana.

The newly announced group consists of 14 existing medical marijuana licensees interested in entering the adult-use market, 15 municipalities that are considering allowing licensed recreational facilities, 13 attorneys who represent marijuana establishments that have an interest in the rec cannabis market, and 15 individuals or businesses interested in participating as potential licensees or consumers. The state says that they received an overwhelming amount of interest in the group, and that they will keep all whom applied under consideration for future work groups. 

Former Detroit Lions Receiver is awarded licensing

Calvin Johnson, a former standout receiver with the Detroit Lions, and his wife Brittney were recently granted prequalification status, by a 4-0 vote by the medical marijuana licensing board. Michigan’s licensing board bestows prequalification status when an applicant has completed a background check but hasn’t been granted approval from the municipality in which they are hoping to do business. 

Johnson and his business partner, former Lions and Seattle guard Robert Sims, were denied licensing back in December for a grow operation and processing facility. The reasoning behind the board’s decision to deny licensing was due to previous unpaid traffic violations in Atlanta, GA that were from approximately 10 years ago. Johnson has since paid those fines, and as a result the board decided to approve the dispensary license. Both Johnson and Sims have decided to appeal the board’s decision from December, Johnson has partnered with his wife for the dispensary, which will operate operate as Michigan Community Collective.

LARA updates approved Medical conditions list

The list of qualifying medical conditions are ever changing, and as of recently, a new condition has officially been added to the list. Effective immediately, Cerebral Palsy has now been approved as a qualifying, debilitating medical condition for medical marijuana cardholders, by a unanimous vote. Unfortunately, however they denied the condition of Chronic Aggressive Behavior, which was also up for vote. The full list of qualifying conditions are now as follows; 

  • Acquired Immune Deficiency Syndrome
  • Agitation of Alzheimer's disease
  • Amyotrophic Lateral Sclerosis
  • Arthritis
  • Autism
  • Cancer
  • Cerebral Palsy 
  • Chronic Pain
  • Colitis
  • Crohn's Disease
  • Glaucoma
  • Hepatitis C
  • Inflammatory Bowel Disease
  • Nail Patella
  • Obsessive Compulsive Disorder
  • Parkinson’s Disease
  • Positive status for Human Immunodeficiency Virus
  • Post-Traumatic Stress Disorder
  • Rheumatoid Arthritis
  • Spinal Cord Injury
  • Tourette’s Syndrome
  • Ulcerative Colitis

A chronic or debilitating disease or medical condition or its treatment that produces one or more of the following:

  • Cachexia or Wasting Syndrome
  • Severe and Chronic Pain
  • Severe Nausea
  • Seizures, including but not limited to those characteristic of epilepsy
  • Severe and persistent muscle spasms, including but not limited to those characteristic of multiple sclerosis

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