16 January 2017

Here’s the introduction . It is worth a read if you want to get a good idea of what’s happening in the state before delving further.

Here’s part of the article

On one hand, the shake-up of Michigan’s medical cannabis market will provide patients with their greatest access yet to legal pot, and it appears to have put the state on the verge of the next big step — legalizing recreational marijuana.

On the other hand, the new laws have left local communities scrambling to decide how much to allow the industry to grow locally, if at all. At the same time, legalization advocates fear state officials have established a regulatory framework that limits the free market, shuts out small-time growers and passes on higher costs to patients.

“This policy was designed with business interests in mind,” said Matthew Abel, a lawyer and executive director of the Michigan chapter of the National Organization for the Reform of Marijuana Laws. “They’re not in favor of (marijuana) but they’re trying to get ahead of the curve so they can implement their system instead of something that’s more free and open.”

New commercial system

The changes will create licenses for commercial growers, processors, secure transporters, testing facilities and retail dispensaries. The state also will allow cannabis-infused edible products and more potent extracts and oils. In return, the state and local governments will collect a 3 percent tax on dispensary sales, plus licensing fees from those who take part in the system.

“You’ve got a lot of moving parts taking place,” said Michael Komorn, a Detroit lawyer and president of the Michigan Medical Marijuana Association. “To me, it represents a new era of the state unequivocally saying they’re in the business of selling medical marijuana and receiving revenue from it.”

In December, the state will begin accepting applications for licenses under the new commercial system, with the first licenses likely to be issued in 2018.

Up to this point, Michigan has allowed the growing of limited marijuana only by certified medical users or by caregivers who may serve a maximum of five patients at a time. A certified patient may grow up to 12 plants, while a caregiver may grow a maximum of 72 plants.

The new laws will create a bigger commercial system, but one that will be strictly controlled. A licensed grower may sell plants only to a processor or dispensary, for example, and patients and their caregivers will be able to buy products only from the dispensaries, rather than directly from a grower or processor.

For aspiring marijuana entrepreneurs like Buchanan’s John Wallace, the new system presents an opportunity to get in on a growing industry. An analysis of the new laws by the Michigan House’s nonpartisan fiscal agency estimated the state’s medical marijuana industry at $837 million. And those who can navigate the new legal framework hope to set themselves up as early players if the state legalizes the even larger market for recreational pot.

“I want to get into it now and get through all the little hiccups along the way, and then we can get into (recreational marijuana),” Wallace said. “Then maybe we can have medical and recreational all in one place.”

Participating in the new system will come at a cost. The state will charge applicants an undetermined licensing fee and annual “regulatory assessment,” which could total $10,000 for even the lowest class of commercial growers, those with 500 plants or fewer. Dispensaries will pay a 3 percent tax on gross sales, possibly on top of the existing 6 percent sales tax. And players in the new system will take on more costs to pay authorized transporters and testing facilities.

To some medical marijuana advocates, the new regulatory layers will add up to a financial burden on patients, though a cardholder will still be able to grow up to 12 plants for personal use or seek pot from a caregiver.

Cutting out caregivers?

In some ways, the new laws will legitimize dispensaries, which have operated in the legal shadows since the original medical marijuana law was approved by voters in 2008. In a series of rulings, state appellate courts said the medical marijuana law did not offer protection for retail stores, though caregivers and patients have tried to keep dispensaries open as nonprofit “collectives” or “clubs.”

In the more cannabis-friendly areas such as Ann Arbor and Lansing, dozens of dispensaries have operated without much interference from local or state authorities. But the facilities have remained illegal under state law, and in areas such as Grand Rapids they have shut down after raids by police.

Because processors and dispensaries will be allowed to buy marijuana and products only from the new commercial entities, existing medical marijuana caregivers will not have a legal outlet for their “overages,” or excess product after providing for their patients, said Komorn, the Michigan Medical Marijuana Association president.

When the new legal framework takes effect, it’s unclear if the state will allow any of the existing dispensaries to shift to the new system, or if some caregivers will try to keep operating underground with the same model.

Full article at