In case you did not know…

In September 2025, the Michigan Legislature passed House Bill 4951, known as the Comprehensive Road Funding Tax Act. This legislation introduces a significant change to the taxation of marijuana in Michigan, with implications for cannabis businesses and consumers alike.

Overview of HB4951

Effective January 1, 2026, HB4951 imposes a new 24% excise tax on wholesale marijuana transfers. This tax applies to:

• Transfers from marijuana establishments to retail licensees.

• Transfers from provisioning centers to retail licensees.

• Marijuana cultivated or processed by retailers for direct sale.

The tax is calculated based on the wholesale price, which includes all fees and charges but excludes discounts or rebates. The Michigan Department of Treasury will administer the tax, including rulemaking, collection, and enforcement.

Revenue Allocation

The revenue generated—estimated at $420 million annually—will be distributed between two newly created funds:

• Comprehensive Road Funding Fund: Supports administration and implementation of the act.

• Neighborhood Road Fund: Finances road construction, maintenance, and preservation across Michigan.

For fiscal year 2025–26, $3 million will be allocated to the Comprehensive Road Funding Fund, with the remainder going to the Neighborhood Road Fund. In subsequent years, the administrative allocation will be reduced to $500,000, adjusted annually for inflation.

Legislative Background

HB4951 was introduced by Rep. Samantha Steckloff (D–Farmington Hills) as part of a broader infrastructure funding package. It complements other bills addressing fuel taxes, corporate income tax, and insurance assessments. The legislation reflects Michigan’s strategic shift toward leveraging cannabis industry revenues to address long-standing infrastructure needs without increasing general taxes.

Frequently Asked Questions (FAQs)

1. What is the purpose of HB4951? HB4951 aims to generate sustainable funding for Michigan’s road infrastructure by imposing a new excise tax on wholesale marijuana transactions.

2. Who is affected by the new 24% marijuana tax? Cannabis businesses—specifically growers, processors, provisioning centers, and retailers—will bear the tax burden. While consumers won’t pay this tax directly, retail prices may increase as businesses adjust.

3. How is the wholesale price determined? For unaffiliated transactions, it’s the actual price paid, including fees. For affiliated entities or self-produced marijuana, the Department of Treasury will publish an average wholesale price quarterly.

4. Where does the tax revenue go? Funds are split between the Comprehensive Road Funding Fund (for administration) and the Neighborhood Road Fund (for road projects statewide).

5. When does HB4951 take effect? The new tax structure begins on January 1, 2026, contingent on the enactment of related bills (HB4183, HB4961, HB4968) addressing fuel, income, and insurance taxes.

For full legislative text and analysis, visit:

• Michigan Legislature HB4951 Bill Page
• House Fiscal Agency Legislative Analysis PDF
• Michigan Regulation and Taxation of Marihuana Act Definitions

In case you did not know…

The Michigan Supreme Court has ruled that the smell of marijuana alone is no longer sufficient probable cause for police to conduct a warrantless search of a vehicle. This decision overturns a previous precedent where the odor of marijuana was considered enough justification for a search.

The Court reasoned that because the use and possession of marijuana is now legal for adults in Michigan under certain circumstances (following the Michigan Regulation and Taxation of Marihuana Act – MRTMA), the smell of marijuana no longer automatically indicates illegal activity. The odor could just as likely be associated with the legal possession or recent legal use of marijuana.

Therefore, the Court concluded that while the smell of marijuana can still be a factor in determining probable cause, it must be accompanied by other specific and articulable facts indicating illegal activity to justify a search.

This ruling stems from a case where a firearm was found in a vehicle after a search was conducted based solely on the smell of marijuana. The Supreme Court sided with the lower courts in suppressing the evidence, stating that the initial search was unlawful because the smell of marijuana alone did not provide probable cause in light of the state’s legalization of cannabis.

This decision is a significant shift in Michigan law and will likely impact how law enforcement conducts vehicle searches. It emphasizes the need for additional evidence beyond the smell of marijuana to establish probable cause for a search.

They can’t say because we smell weed we are going to search your car. Because the whole town may reek.  Alas… there are a hundred other words to choose from to make the arrest.

They have to say something else now. If you’re sitting behind the wheel of a motorized vehicle all a police officer has to say is “I believe you’re impaired”. And operating a motor vehicle impaired is a crime.

So don’t think this is a win. Maybe a little one.

Read the ruling linked below.

Michigan Supreme Court Smell of marijuana no longer legal grounds for search

The Michigan Supreme Court has ruled that the smell of marijuana alone is no longer sufficient probable cause for police to conduct a warrantless search of a vehicle. This decision overturns a previous precedent where the odor of marijuana was considered enough justification for a search.

The Court reasoned that because the use and possession of marijuana is now legal for adults in Michigan under certain circumstances (following the Michigan Regulation and Taxation of Marihuana Act – MRTMA), the smell of marijuana no longer automatically indicates illegal activity. The odor could just as likely be associated with the legal possession or recent legal use of marijuana.

Therefore, the Court concluded that while the smell of marijuana can still be a factor in determining probable cause, it must be accompanied by other specific and articulable facts indicating illegal activity to justify a search.

This ruling stems from a case where a firearm was found in a vehicle after a search was conducted based solely on the smell of marijuana. The Supreme Court sided with the lower courts in suppressing the evidence, stating that the initial search was unlawful because the smell of marijuana alone did not provide probable cause in light of the state’s legalization of cannabis.

This decision is a significant shift in Michigan law and will likely impact how law enforcement conducts vehicle searches. It emphasizes the need for additional evidence beyond the smell of marijuana to establish probable cause for a search.

They can’t say because we smell weed we are going to search your car. Because the whole town may reek.  Alas… there are a hundred other words to choose from to make the arrest.

They have to say something else now. If you’re sitting behind the wheel of a motorized vehicle all a police officer has to say is “I believe you’re impaired”. And operating a motor vehicle impaired is a crime.

So don’t think this is a win. Maybe a little one.

Read the ruling linked below.

Michigan Supreme Court Smell of marijuana no longer legal grounds for search

Can the police sieze your belongings and hold it without charging you with a crime?

Civil asset forfeiture is a legal process that allows law enforcement agencies in Michigan to seize property they suspect is connected to criminal activity, even if the owner hasn’t been charged with a crime. This practice has been controversial, leading to significant reforms in recent years.​

Key Points:

News Article links

• Definition: Civil asset forfeiture permits authorities to confiscate assets believed to be involved in or resulting from criminal conduct without necessarily charging the owner.​Mackinac Center
• Reforms: Michigan has implemented several reforms to address concerns about civil asset forfeiture:​Mackinac Center
• 2015: Increased the standard of evidence required for forfeiture from “preponderance of evidence” to “clear and convincing evidence.” ​Mackinac Center
• 2016: Eliminated the requirement for property owners to post a bond before challenging a seizure. ​Mackinac Center
• 2019: Mandated a criminal conviction or plea agreement before forfeiting property valued under $50,000 in drug-related cases. ​AP News
• 2022: Amended laws to allow forfeiture of assets over $20,000 at airports without a criminal conviction. ​Mackinac Center
• Recent Developments: In 2023, a federal court ruled that Wayne County’s vehicle seizure program violated constitutional due process rights, highlighting ongoing concerns about forfeiture practices. ​Mackinac Center
• Statistics: In 2022, Michigan law enforcement agencies seized over $10.2 million in cash and conducted nearly 4,000 forfeitures. Notably, more than 150 individuals lost property without being charged, and another 100 without a conviction. ​Mackinac Center
• Criticism: Critics argue that civil asset forfeiture can lead to abuses, disproportionately affecting innocent individuals and marginalized communities. 
• Advocacy for Change: Organizations like the Mackinac Center for Public Policy advocate for ending civil asset forfeiture, suggesting that property should only be forfeited following a criminal conviction to better protect citizens’ rights. ​Mackinac Center

Understanding Michigan’s civil asset forfeiture laws is crucial, as they directly impact property rights and law enforcement practices. While reforms have been made, ongoing debates suggest that further changes may be necessary to ensure fairness and protect citizens’ rights

Can the police sieze your belongings and hold it without charging you with a crime?

Forfeiture laws in Michigan allow the government to seize property – like cash, cars, or even houses – if they believe it was involved in a crime.  This can happen even if the owner hasn’t been convicted of a crime. It’s a complex area of law with some important things to understand. 

What is Forfeiture?

Forfeiture is a legal process where the government takes ownership of private property because it’s believed to be connected to illegal activity. There are two main types:  

Criminal Forfeiture: This happens after someone has been convicted of a crime. The property seized is usually related to that specific crime. 

Civil Forfeiture: This can occur without a criminal conviction. The government argues that the property itself was involved in a crime, regardless of whether the owner is found guilty.  

Important Points to Know:

What Property Can Be Forfeited?

Under Michigan law (specifically related to drug crimes, (MCL 333.7521), a wide range of property can be seized, including:

• Money, negotiable instruments, and securities.
• Real estate (MCL 600.3815)
• Vehicles, boats, and aircraft (S.B. 2 & H.B 4001-4002)
• Equipment and materials used in illegal activities (like drug manufacturing).
• Anything of value exchanged for illegal substances.

How Does it Work?

Seizure: Law enforcement can seize property if they have probable cause to believe it’s connected to a crime. In some cases, they need a warrant, but not always (MCL 333.7522). 

Notice: If your property is seized, the government is supposed to notify you (MCL 600.4707 & 333.7523). If they can’t find you, they may publish a notice online or in a newspaper.  

Claim: If you want your property back, you usually have a limited time (e.g., 20-28 days after notice) to file a claim with the government, stating your interest in the property and why it shouldn’t be forfeited. This claim often needs to be written, signed, and verified (notarized).  

Civil Action: If you file a claim, the government (usually the Attorney General or local prosecutor) may then file a civil lawsuit in court to try and get a forfeiture order.

Burden of Proof: In a forfeiture hearing, the government generally has to prove by a “preponderance of the evidence” (meaning it’s more likely than not) that the property was connected to a crime (MCL 600.4707). However, for property valued over $50,000 in drug cases, the burden might shift to the owner to prove they didn’t know about the illegal activity (according to some interpretations of MCL 333.7523a).  

Conviction Requirement (Limited): A significant reform in 2019 (Senate Bill 2 and House Bills 4001 & 4002) requires a criminal conviction or plea agreement for forfeitures of property valued under $50,000 in drug-related cases, unless the owner abandons the property (news from May 2019).  

Rights of Property Owners

You have the right to:

• Be notified about the forfeiture proceedings.
• File a claim to contest the forfeiture.
• Have a hearing in court (if you file a claim).
• Present evidence to show your property wasn’t involved in a crime or that you were an innocent owner.

What Happens to Forfeited Property?

Generally, the law enforcement agency that seized the property can keep it for their use or sell it.

The proceeds from the sale are often used for law enforcement purposes (MCL 333.7524).

Kelsey’s Law Connection: It’s important not to confuse forfeiture laws with traffic laws like Kelsey’s Law (related to teen drivers and cell phone use). They are completely different areas of law.

Links to Laws:

• MCL 333.7521 (Controlled Substances – Forfeiture): You can find these sections within the Michigan Public Health Code on the Michigan Legislature website.
• MCL 600.4701 (Revised Judicature Act – Forfeiture): This act also contains provisions related to forfeiture.

Recent News:

• Michigan Supreme Court Ruling (July 2024): The Michigan Supreme Court ruled against Detroit’s practice of seizing cars in drug-related cases unless there’s evidence the car was used to transport drugs for trafficking purposes. This decision is seen as a curb on aggressive forfeiture practices.  
• Report on Forfeiture (October 2023): A report highlighted that even with recent reforms, Michigan still sees cases where people lose property without being charged with a crime, and most forfeiture cases happen without much court oversight (Mackinac Center, October 2023). 
• Limitations on Forfeiture Without Conviction (2019): As mentioned earlier, laws were passed in 2019 requiring a conviction in many drug-related forfeiture cases involving property under $50,000 (Michigan.gov press release, May 2019).

It’s crucial to understand that forfeiture laws can have a significant impact on individuals, even those who haven’t been found guilty of a crime. If your property has been seized, it’s highly recommended to seek legal advice immediately to understand your rights and options.