During the November election, 56% of voters passed Proposal 1 making adult use cannabis in Michigan a reality. Spearheaded by the Coalition to Regulate Marijuana Like Alcohol, the effort to pass the Michigan Regulation and Taxation of Marihuana Act (MRTMA) started with 277,370 certified voter signatures that got the proposal on the midterm ballot. What comes next is still up in the air.
At Medicine Man Technologies, we are hopeful that state lawmakers will move more quickly than they have since voters passed a medical cannabis bill in 2008. A basic framework and regulations took nearly 10 years to develop and the newly established Medical Marihuana Licensing Board didn’t begin taking applications for growers, transporters, dispensaries and other operations until December 2017.
In addition, changes continue to hinder the market. Right now, unlicensed medical dispensaries are operating under temporary emergency rules while they await state approval. Many purchase cannabis from a network of 40,000 registered caregivers who can legally grow up to 72 plants for their patients and sell their excess to dispensaries. Because of recent changes to the laws, once dispensaries are fully licensed, they will not be allowed to purchase cannabis from caregivers after 30 days.
Meanwhile, growers are still in the process of licensing and establishing their operations, much less cultivating. Supply shortages are inevitable and some dispensaries could be forced out of business.
With that being said, how will adult use cannabis in Michigan move forward?
A Quick Overview of What Prop 1 Covers
While recreational cannabis will be legal as of December 6, Michigan’s Department of Licensing and Regulatory Affairs will first need to focus on setting up the state’s framework and won’t begin licensing businesses (growers, retailers, processors, etc.) until December of 2019.
That means residents will likely have to wait until 2020 for retail sales to begin – longer if roadblocks similar to the state’s medical cannabis program arise. In the meanwhile, here’s what MRTMA covers:
- Michigan adults, 21 years of age and older, will be allowed to possess, transport and use (only in a private setting) up to 2.5 ounces of cannabis or 15 grams of concentrate.
- Adults may grow a maximum of 12 cannabis plants inside their home or a secured, outdoor area that’s hidden from public view (such as from the street).
- Each household is allowed up to 10 ounces of dried cannabis flower for personal use, however, anything over 2.5 ounces must be kept in a locked container.
- Adults may also transfer, without payment, up to 2.5 ounces or 15 grams of concentrate to another adult. Unlicensed sales by an individual are illegal.
- Landlords can decide if tenants are allowed to grow or use cannabis inside their rental units.
- The laws for adult use cannabis in Michigan does not provide any disciplinary protection from an employer’s drug policies, testing requirements, or working under the influence.
- Operating any type of vehicle under the influence of cannabis is illegal.
- Like alcohol, anyone under the age of 21 is prohibited from possessing or using cannabis, and it’s illegal to transfer or purchase it for anyone underage.
Once the program is launched, there will be a 10% excise tax on top of the current 6% sales tax for all sales. This will first go towards funding the ongoing operations of Michigan’s Department of Licensing and Regulatory Affairs. Another $20 million is earmarked until 2022 to research the use of cannabis in treating U.S. military veterans and preventing suicides. The remaining will be split between cities and counties based where cannabis-based businesses are located, as well as schools and transportation.
At Medicine Man Technologies, we were excited to see voters embrace adult use cannabis in Michigan. And we can only hope that it won’t take another 10 years for state officials and lawmakers to develop the foundation and launch a properly working system.
If you wish to start your own legal enterprise in the U.S. or anywhere across the globe, please contact us for private consulting, as well as help with licensing, cultivating, dispensary operations and more.