What's the state of Michigan marijuana now that the emergency rules are in play?

Jul 15, 2019 at 4:43 pm
click to enlarge What's the state of Michigan marijuana now that the emergency rules are in play?

It's been 11 years since medical marijuana was made legal in Michigan, and less than one since recreational adult use was passed. There's been a lot of push and pull about the marijuana industry in that time. We stand at the cusp of seriously opening the mass market for the first time. As we begin to make that move, it's worth reflecting: What is the state of marijuana in Michigan? The state's emergency rules for adult-use marijuana is a guide to that. Here are eight aspects of the marijuana rules and general climate that indicate where we're at.

People want pot ... but can't buy it legally

It's clear that people want pot. They voted for it last November, and lined up outside of provisioning centers when adult use was made legal. There is a lot of general confusion about access to legal marijuana. Most people don't follow the details, and just want to know when they can go to the store and buy pot. The answer to that question is still up in the air. The state will begin taking applications for recreational marijuana businesses on Nov. 1. Folks at the state licensing office say that they have made the process easier and quicker. We'll see how well that goes come November. However, a practical person should not expect to see any stores selling recreational stuff before Jan. 1.

In the meantime, people who want marijuana will have to depend on wherever they've been getting it these past few years — that's medical marijuana provisioning centers if they have a medical marijuana card, or the out-of-control black market if they don't. Remember, it's legal for adults to "gift" up to 2.5 oz. of marijuana or 15 grams of marijuana concentrate for free to another adult.

Already lined up

When the state does start accepting applications from already licensed operations, things will be expedited. From a speed-it-up point of view, this makes sense because all those folks have already been vetted and the state is therefore not starting out from zero. They have been in business and under state observation thus far, and bureaucrats will have a sense of how they do things.

However, this also has the smell of a make-good for angry owners who went through that onerous and expensive licensing process while the regulators were still dragging their feet about licensing. The adult-use rules are simpler and cheaper for potential owners. Giving adult-use licenses to those who already have medical licenses gives them an opportunity to bring in some money before the market blows up.

While this makes sense, it also belies most of the provisioning center owners I've talked to over the years. Whenever the idea of a future in recreational sales came up, everybody claimed that their only motivation was to help patients and that they weren't even thinking about recreational. The way this is set up shows a clear line from medical licenses to adult-use licenses.

Rich get richer

Class C licenses allow a grower to have up to 1,500 plants. An entity with five of those would be allowed to grow 7,500 plants. However, the way the program has been administered so far, there is far too little product in the system. That may change. One of the provisions in the new rules allows any entity with five or more Class C licenses to obtain a license to expand their marijuana plant count. This also has the smell of a make-good for licensees.

Marijuana taster?

The new rules say "growers, processors, retailers, and microbusinesses may offer tested internal product samples for their employees to consume, off-site, to ensure the quality and/or potency of the products." They may also provide samples to other processors and retailers to test their products. This looks like it could lead to an actual position of marijuana taster. Somebody has to set the standards.

Social use 1

There are a couple of other potential new categories of license that will appeal to the smaller operators. A Marijuana Event Organizer will be able to apply for a license to hold a Temporary Marijuana Event, where onsite sale and consumption of marijuana products will be allowed. It's not clear where those products would come from.

In addition, there is a license for a Designated Consumption Establishment, where folks are allowed to consume marijuana and marijuana products. This license will not allow sales of products at the same establishment unless the place also holds a retailer or microbusiness license. The retailer designation is the adult-use equivalent of a provisioning center on the medical side.

Social use 2

It's not hidden or anything, but people need to note that the state in fact agrees that people can get together and use marijuana in designated areas — the same way people are allowed to gather for alcohol consumption. This is potentially huge. Even though the laws are changing, the stigma against use is strong in many places. The sense was that while marijuana use is allowed, those users need to stay out of sight and out of mind. The consumption establishment provision says that marijuana users have a public social and cultural profile for their activities.

Social equity

The emergency rules say that the state social equity plan "will (1) promote and encourage participation in the marijuana industry by people from communities that have been disproportionately impacted by marijuana prohibition and enforcement and (2) positively impact those communities." We're all anticipating how the state intends to do that and will probably know as soon, as Marijuana Regulatory Agency officials are planning a big reveal in Lansing on the subject. Then we'll find out those rules live up to the promise.

Federal aspect

Any assessment of the state of marijuana needs to account for the federal situation, where nothing of note has changed — leaving a tremendous amount of state movement up in the air. There have been some fits and starts, such as a hearing earlier this month — "Marijuana Laws in America: Racial Justice and the Need for Reform" — to the House Judiciary Subcommittee on Crime, Terrorism, and Homeland Security. It was historic in the fact that there had never been such a hearing before. However, Washington is geared up for a presidential campaign and election, and has a whole lot of other issues to command attention from legislators. Marijuana is low on the list.

That means that business will still be hamstrung for financial services and, regardless of state laws, there is still a latent fear that the feds could go crazy and take it all down.

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