Understanding the ins and outs of obtaining and complying with a Michigan marijuana growing license is critical when your marijuana business is part of the marijuana industry in Michigan. There have been numerous changes to Michigan state law regarding the legality of cannabis over the last 12 years since Michigan first allowed for medical marijuana usage. Those in the industry need to be aware of and abide by those changes and current guidelines.
The laws around Cannabis growing, distribution, sale, , and use in Michigan have changed since cannabis was first legalized for medical use back in 2008 and continue to evolve…
Before cannabis was legalized in Michigan, possession of any amounts of the plant was considered a misdemeanor offense punishable by up to one year’s incarceration and a $2,000 fine, while use had a maximum sentence of 90 days in jail and only a $100 fine. Distributing without remuneration was also considered a misdemeanor with a maximum sentence of one year in jail and a $1,000 fine. The penalties for the sale and cultivation of cannabis were much steeper and both were considered a felony punishable by up to 15 years imprisonment and $10,000,000 in fines depending on the number of plants grown and the amount of usable cannabis sold.
In November 2008, the Michigan Compassionate Care Initiative was approved by Michigan voters. The measure allowed patients with a physician’s recommendation to possess up to 2.5 ounces of cannabis for treatment of certain qualifying medical conditions. Although it did not explicitly allow dispensaries to open doors and operate, it did allow patients or their caregivers to grow up to 12 cannabis plants.
In November 2017 365,000 signatures were gathered and submitted to the state legislator in favor of legalizing cannabis. The state lawmakers opted to put the decision to the voters and put a cannabis recreational legalization measure on the 2018 ballot. On November 6, 2018, Michigan voters approved Proposal 1 by a 56–44 margin and Michigan became the first midwest state and the 10th state in the United States to make recreational cannabis legal. During 2019 the first recreational marijuana dispensaries opened. However, obtaining a Michigan license for the cultivation of marijuana is quite difficult and the laws are quite complex.
Cannabis growing, production, and use in Michigan are everchanging. Beginning in 2008 with caregivers, until 2019 when the original recreational marijuana dispensaries were opened. Michigan is the 10thstate government in the United States to make recreational cannabis legal. And even with the positive changes in the marijuana industry, it is still difficult to attain a Michigan license for the cultivation of marijuana as well as understand all the laws around it.
Be sure that you understand the details around obtaining a grower license to start a marijuana facility, and how to comply with Michigan law in 2021.
Having a Michigan marijuana growing license means that people are allowed to possess cannabis seeds and plants for selling if it is done using a secure transporter. They can also sellmarijuana to a dispensary (known as a provisioning center in Michigan) and to a licensed processing person or company.
There is also a cultivation license in Michigan that is distinct from a growing license, and has different eligibility requirements and does not need a compliant facility or secure transporter. However, no one entity or person may have both a cultivation license and a grower’s license too.
There is also a requirement in Michigan for those that are licensed to grow must also have an employee who is actively working and has a minimum of two years of experience as a registered primary caregiver. The licensed grower and the registered primary caregiver cannot be the same person.
There are 2 variations of commercial grow licenses that can be obtained in Michigan. Both of them have three classes based on how much of the cultivated marijuana plant is in your grow facility.
There is also an adult-use plan that allows for a microbusiness license. These microbusiness licenses are similar to the licenses given to craft breweries where they can produce and operate in one space. As long as these smaller businesses do not violate local laws, regulations, and statutes, then they can be built. Their requirements are quite different from bigger operations.
Getting into the marijuana growing business is not cheap. The beginning costs of a Michigan marijuana growing license includes a non-refundable application fee, as well as a regulatory assessment. The total fees range from $4000 to $40,000 depending on the class you are applying for. There are also additional fees that are allowed by the MMFLA (Medical Marijuana Facilities Act). Other fees applied pertain to the municipality where your cannabis growing is being done, and those can be as high as $5000.
The state application fee of $6000 charged is not refunded if your license is refused. .These fees are used to pay the costs of the regulatory agency, the Michigan State Police, and other contract fees for services of investigation. These services are to do background checks and investigations on the license applicants.
Further to the above fees, the annual regulatory assessment for the state plays into costs. It is due before a license is issued and can change based on the type of and how many licenses are applied for. Class A licenses are capped and cannot be over $10,000. B and C Class depend on how many licenses and can go from $10,000 to $66,000.
Obtaining a Michigan marijuana grow license is not a short process. There are extensive documentation requirements and processes to be followed when it comes to applying. It needs to be done properly or it is sent back for correction and clarification. Make sure everything is complete when doing the work so there are no hold-ups. It helps if you can hire an accountant, consultant, or attorney who knows the Michigan industry and how to work through each step. There are two main steps to follow:
The pre-qualification for a Michigan marijuana grow license consists of a complete background check that’s done for each applicant on the license. If an individual has an ownership interest, then they will be checked thoroughly. This part of the application process will also look at the finances of those applying to make sure they have the financial ability to pay for not only the growing license they want, but any additional costs as well. This financial search includes a look at any unexplainable source of income or undefined transactions.
Once the pre-qualification stage is complete, then the licensing starts. This is the stage where the applicant must define what particular license they desire to apply for. Details are asked about where the facility is to be located as well as a review of business details and requirements. A business plan needs to be in place and be very detailed to cover every factor that is required to meet standards and codes. It must include security, facility content, staffing, required technology, financial plans, and disposal of waste, along with other industry standards.
Once these applications are completed and approved, then the licensing moves forward. It is monitored under the State Department of Licensing and Regulatory Affairs (LARA). While there is no restriction on license amounts under this agency, be mindful that cities or towns where facilities are zoned for such operations, can regulate, halt or restrict the number of cannabis businesses that are in their communities.
The Marijuana Regulatory Agency in Michigan is a regulatory program that stimulates business growth while preserving safe consumer access to marijuana and it is a great resource for those who want to obtain a license . The site is easy to navigate and has lots of information on laws and regulations, together with online application forms and instructions.
Michigan has a mandatory regulatory tracking system, METRC . METRC is a seed-to-sale marijuana tracking system that uses serialized tags attached to every plant, and labels attached to wholesale packages to track the entire history of the marijuana inventory. Tags are attached to a plant to facilitate tracking through different stages of growth. Additionally, the tag tracks the drying and curing processes, and eventual retail sale.
There are different third-party software that integrates with METRC that will help you cover the compliance requirements with Michigan laws and help with managing your business and growth as a whole.
Getting into the marijuana growing business in Michigan can be successful if all guidelines are followed and proper licenses are obtained. While the legislation is strict, the barrier to entry is high and cannabis growing has a lot of market potential. The front-end work is extensive but once you are up and growing, it may be well worth that time and effort.
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