I was at a meeting of the Detroit City Planning Commission when a proposed dispensary law was being discussed. One commissioner, clearly an opponent of marijuana stores, asked, “If we pass this, can we start closing these places tomorrow?”
Donald Bailey, a member of the Medical Marihuana Licensing Board that is tasked with setting up the rules for a marijuana distribution system by mid-December, did the same thing at the board’s Aug. 21 meeting. Bailey opened the meeting with a proposal to tell all dispensaries whose owners want to be considered for a state license that they have to shut down by mid-September.
Luckily, others on the five-member board decided to hear testimony from the 200 or so people at the meeting. After four hours of testimony, the four MMLB members in attendance decided to seek information from the state licensing board and the attorney general’s office before making a decision.
Bailey is a retired state police sergeant who apparently still carries a banner for the war on drugs. That’s his right, and I guess his proposal should come as no surprise. However, it’s a shame that people with that attitude — at city and state levels — are those tasked with setting up the system for patients to access marijuana. To start with, I’m pretty sure they don’t believe that marijuana is medicine, because they appear to have no concern for patients here.
If all of the dispensaries shut down in September, are the epileptics just supposed to have seizures all the time until the new system opens up in mid-December? That seems to have been the attitude of legislators and law enforcement in Michigan since the medical marijuana law passed nine years ago. They basically said, “Well, the law says you can have this stuff, but it doesn’t say you can have stores to supply it.”
Then, instead of fixing that, they demurred, hemmed, hawed, blocked, arrested, ruined lives, and tried everything possible to take down legal patients, including reportedly pressuring the state crime lab to classify extracts in a manner that allowed prosecutions. (Thank you attorney Michael Komorn for exposing that.)
In the face of a medical marijuana law created by a vote of the people, the state amended the war on drugs to include a war on patients.
Another reason I think that much of our government leadership doesn’t believe marijuana is medicine is that in all of the legislating that has been done, there has been nothing calling for medical qualifications or standards — or anything else regarding the medical side of this. (Americans for Safe Access has a Cannabis Care Certification program you can learn about at CannabisCareCertification.org.)
So far, the laws that have been passed set up a system that’s more about law enforcement and who gets paid. We haven’t yet seen what the MMLB will come up with, but we know there are going to be licenses that will have to be paid for by growers, processors, transporters, and retail sales at the state and local level. Then the state gets tax revenue too, although I don’t begrudge that.
The city of Warren charges $2,500 to dispensary applicants just to process the application. In Detroit, a Caregiver Center license costs $1,470.70. However, there’s a $160 site plan review fee, $1,000 for a conditional hearing, and $2,276 for an annual Detroit Health Department inspection, in addition to a few other charges.
Money is the main incentive the state has to put its system together — not compassion for patients, not the will of the people, not doing the right thing. So it should be no surprise that this is the system that’s coming down the pike.
There are plenty of activists who want to make money somewhere in this system. And the vast majority of the people who have started dispensaries want to turn a profit. They got into the business early in order to already be there when the state came around. A lot of them got busted, incurred huge legal fees, and some went to jail. Who knows — they may be penalized for it in the long run.
I don’t think they should be penalized, but even more so I don’t think patients should be penalized — which is going to be the end result if retail outlets have to shut down.
This whole shutdown suggestion has me wondering if there are other — preferred — vendors they want to make room for. MMLB Chair Rick Johnson (a former Republican state speaker of the House) was praised by the Michigan Responsibility Council when he was appointed by Gov. Rick Snyder back in May. But the MRC was the front for a group of investors who, a few years back, were trying to get a system of legal marijuana in which they controlled all production and sales. Now, the MRC opposes the 2018 ballot effort to “regulate marijuana like alcohol” because it’s the “wrong” kind of system.
Hmm. I wonder if the “right” kind of system is one where they control everything?
There does need to be a system for marijuana regulation. The state has dragged its feet for far too long, and the lack of a clear vision in Lansing has left the system vulnerable to ideologues like Bailey and profiteers like Johnson. And nobody seems to be particularly concerned about the patients.
Looks like we’re going to get something that mimics the for-profit medical care system we already have in place.
Closure has already hit the Reef, a caregiver center on Eight Mile Road that shut down on Sunday because owners anticipated having to apply for state certification. In a press release sent last week, the Reef announced that “all indications are that the Board will eventually vote in favor of closing all dispensaries in Michigan until each one is licensed through the State.”
The Reef is already certified to operate in Detroit, a spokesperson told me, saying, “We don’t know what the board is going to do. We don’t know what authority they have to do any of this. But we’re doing everything in anticipation. We did the same thing with the city of Detroit. We also complied to the terms the city set out.”
Regarding patients, the spokesperson said: “Our plan is to reopen with state licensing. We’re hoping that they can find their medicine elsewhere. … This is a temporary situation to make sure we’re there for the long haul.”
I guess we could see a lot of this across the state.
Despite all that, folks who wish to pursue their dream of starting a marijuana-related business may want to check out the marijuana business seminar scheduled for Friday, Sept. 22 at Cobo Center. Sponsored by the Royal Oak-based Cannabis Legal Group, the seminar will focus on licensing, testing, and business operations.
GRAND RAPIDS — A medical marijuana caregiver has filed a federal lawsuit after police raided his St. Joseph County home last year.
Police arrested Sean Muntian and his wife, April Armstrong, after raids at their Three Rivers home and business, Triple Ripple Hydroponics. Police seized marijuana and grow equipment, and prompted an investigation by Child Protective Services workers.
Not long after the Jan. 2, 2010 arrests, prosecutors dropped charges, said Southfield attorney Michael Komorn, who specializes in medical-marijuana cases and represented Muntian in the criminal case. He said Monday that police had no interest in Muntian’s status as a medical marijuana caregiver.
In the lawsuit, recently filed in U.S. District Court in Grand Rapids, an attorney for Muntian and Armstrong wrote: “Despite unequivocal rights granted to Mr. Muntian as a licensed caregiver under Michigan law, (police) refused to allow Mr. Muntian to show them proof of his license and the defendants proceeded to seized medicine and equipment in direct violation of the statute.”
Troy attorney Travis Mihelick also alleged the search of their rental home was illegal. The couple’s landlord had reported to police that she detected the odor of burned marijuana in the residence. Using that information, police obtained a search warrant and arrested the couple, the lawsuit said.
Mihelick alleged that police used “extreme force and the threat of deadly force on suspects who were not resisting.”
Both were taken to jail, the attorney said.
“As a result of the illegal search and seizure, Mr. Muntian was forced to close his medical marijuana store and several of his patients were denied access to their prescription medicine.”
The police agencies have not been served with the lawsuit. Three Rivers Police would not comment, while a message left with the St. Joseph County undersheriff was not returned.
The lawsuit alleges unlawful arrest and imprisonment, malicious prosecution, excessive force and illegal search and seizure.
Komorn, the criminal attorney and a board member of the Michigan Medical Marijuana Association, said similar cases have occurred across the state.
He said police should have left Muntian alone after determining he was properly licensed. Instead, he was charged with manufacturing marijuana, possession with intent to deliver and maintaining a drug house.
When arrested, Muntian had state approval as a caregiver but had not received his identification card. Applicants may possess and provide marijuana 20 days after approval, whether or not they have received the card.
Police found about 6 ounces of marijuana in his home, and four large plants and 18 small plants, along with growing supplies, at his shop.
Caregivers are limited to 2.5 ounces of marijuana and 12 plants per patient. Once charges were dropped, Komorn said, Muntian was allowed to retrieve his equipment from the police station. He said the raid, with children in the home, was traumatic.
“Those kinds of images are very hard to shake,” Komorn said.
The investigation by protective services workers only made it worse. Investigators found “no issues there,” he said.
“Medical marijuana patients and caregivers are not bad parents,” he said.
The Michigan appeals court again has reversed a decision and reinstated charges against a man who was accused of running illegal medical marijuana dispensaries in the state’s Thumb region.
The court says James Amsdill knew the legality of marijuana sales was unclear and was also aware that state police didn’t view his Blue Water Compassion Center as legal. The court says, “Prosecution is more than fair under the circumstances.”
A judge in St. Clair County twice dismissed the case, the last time on grounds of entrapment. The case was filed in 2013, long before Michigan lawmakers created a system to allow certain marijuana dispensaries to operate legally.
Licenses could be issued by spring.
Copyright 2017 Associated Press. All rights reserved.
LANSING, MI – The legislature is considering a bill that would limit medical marijuana growing licenses to 1,500 plants per location, something that’s the exact opposite of what the Department of Licensing and Regulatory Affairs has recommended as it crafts regulations for medical marijuana facilities.
The legislature last year passed a bill regulating medical marijuana facilities, including growing operations. Three types of growing licenses are allowed:
The Class A license allows a grow of up to 500 medical marijuana plants.
The Class B license allows a grow of up to 1,000 medical marijuana plants.
The Class C license allows a grow of up to 1,500 medical marijuana plants.
But LARA, which was left in charge of many of the details in implementing medical marijuana facilities regulations, signaled last month that it would allow even bigger grows by letting companies “stack” the largest licenses and grow many times 1,500 plants in one location.
Lobbyists try to shape Michigan’s medical marijuana rules before they’re made
Emails obtained by MLive and the Michigan Campaign Finance Network show a pattern of influence.
“It is the intent of the Bureau of Medical Marihuana Regulation to allow a potential licensee to apply for – and be granted – multiple (“stacked”) class C grow licenses in a single location,” wrote the department in a Sept. 28 press release.
That, said Rep. Jim Runestad, R-White Lake, is “beyond what I think many legislators intended.”
He is the sponsor of House Bill 5189, which would limit medical marijuana growers from holding more than one license at a single facility. He also chairs the House Judiciary Committee, which took testimony on the bill Tuesday morning.
“Having super-grows could potentially monopolize the market and may not be the direction that we would want to go immediately. Only time will tell who the good actors are and if it is reasonable to allow unlimited stacking of licenses per location,” Runestad told the committee.
Rep. Tim Greimel, D-Auburn Hills, questioned whether this bill would really quell monopolistic tendencies. It would still allow the same person to get multiple Class C licenses at different locations, he pointed out.
“That doesn’t reduce the likelihood of monopolistic control over licenses any more than having them in one location, does it?” Greimel asked.
Under the bill, local governments have to “opt in” if they want to license medical marijuana facilities. Two representatives from local communities had different takes on the bill in the House Judiciary Committee on Tuesday morning.
Small towns have big say on future of Michigan’s medical marijuana industry
Businesses are pushing local governments to allow medical marijuana within their boundaries.
Thetford Township Trustee Eric Gunnels said he supported the bill.
“I do think that we should be cautious, that we don’t allow, like you said, monopolies, monopolistic ventures to consolidate the market into the hands of a few,” Gunnels said.
But Bangor Township Supervisor Glenn Rowley said his area had a shrinking revenue stream and large industrial properties medical marijuana grows would bring to life. They already have a few large companies requesting local permits for multiple Class C grows. He opposes the bill.
“We want everyone to succeed,” Rowley said, adding he hoped they made a pile of money so big you need a Sherpa to get to the top of it.
Runestad said there was more testimony he couldn’t get to before the committee was scheduled to end. At this point, though, he thinks there are the votes to get it out of committee and is planning to take it up again at the committee’s next meeting.
Setting up ridiculously difficult requirements for licensing eligibility prioritizes the high profits of a few over industry efficiency, true competition, and patient/consumer rights.
State-sanctioned medical marijuana operational licenses are increasingly becoming a “pay-to-play, greatest barrier to entry” model. In this sort of system, there is usually some combination of the following, all geared towards minimizing the number of licensed cannabis businesses and towards making sure all those who get such licenses are very well-funded:
A difficult and time consuming license application process;
High application fees;
An unreasonably short application window; and
High minimum funding requirements.
To varying extents, Florida, Illinois, New York, Hawaii, Minnesota, and Nevada all have this sort of legalization regime.
Florida. In Florida, only five agricultural nurseries that have been in existence for at least the last thirty years were even eligible to be licensed as dispensing organizations under the state’s extremely limited medical marijuana program. From the few nurseries that qualified, the state prioritized financials in its scoring process and required all of the nurseries to post a $5 million dollar performance bond. In other words, if you weren’t a large and well-funded nursery that has been around for 30-plus years, forget about it. These five nurseries have nearly unfettered access to Florida’s population of 20 million and there’s a chance these five nurseries could end up being the sole providers of medical cannabis under Florida’s impending medical marijuana ballot initiative.
Illinois. Illinois allows only 21 cultivation centers and 60 dispensaries to serve all 13 million people in the state. Illinois set up a point system for judging cannabis licensing applicants based on their proposed security plans, their expertise in growing marijuana, and their plans for patient education. Cultivation centers were required to pay $200,000 for an initial license and have at least $500,000 in liquid assets, in addition to a non-refundable $25,000 application fee. Dispensaries were required to pay $30,000 for a license and have $400,000 in liquid assets, in addition to a non-refundable $5,000 application fee.
New York. Start-up costs for running a medical cannabis company in New York were estimated at around $25 million. The state required a $10,000 non-refundable application fee, plus a $200,000 refundable registration fee for each application. Those seeking a cannabis license also had to show they had the real estate necessary to produce cannabis or be able to post a $2 million bond. Only five operators are allowed to run up to 20 dispensaries throughout the state, and applicants had to produce a litany of documents for the state’s Department of Health that described, in detail, the applicant’s manufacturing processes, transporting, distributing, sale and dispensing policies or procedures. Not as exclusive as Florida, but that’s 20 dispensaries for 20 million people.
Hawaii. Hawaii kicked off its new MMJ legalization regime with a five-year residency requirement and the requirement that its MMJ companies be majority-owned by Hawaiians. Hawaii has some of the toughest, most protectionist cannabis regulations and barriers to market entry in the country. It is set to have only 16 dispensaries in the state, and business applicants also needed to show $1,000,000 “for each license applied for,” and “not less than $100,000 for each retail dispensing location,” all of which had to be under the control of the applicant for no less than 90 days prior to the date of application. There was also a $5,000 non-refundable application fee for each license. Applicants awarded with licenses had to pay $75,000 for each license within a week of approval. Dispensary licensees must also pay an annual renewal fee of $50,000.
Minnesota. Minnesota has an extremely limited medical cannabis program. First, only two operators serve the entire state for cultivation, manufacturing, and distribution. The two operators each operate four dispensaries in the state, for a total of eight. The two operators were selected after the state reviewed their personal histories and capabilities with respect to cultivation, manufacturing, and patient services — these folks even had to commit to having a licensed pharmacist on staff to distribute the cannabis (which makes little sense since cannabis cannot be legally prescribed). And, of course, the state also assessed their financial stability and business plans. One of the operators, Leafline, reportedly raised $12.4 million in investment from 113 investors. All of this for a state that, at the time, claimed to have only 5,000 registered qualifying patients.
Nevada. In Nevada, running a marijuana business is like running a casino — it’s capital-intensive and only a select few get to participate. Nevada requires local control of its cannabis businesses and its license applicants needed to show no less than $250,000 in liquidity. They also had to produce volumes of documents showing detailed floor plans, security, personnel manuals, and even advertising and marketing plans, all of which were scored against a strict point system. In addition, the application fee was a non-refundable $5,000, and the license issuance fee (per license) is $30,000.
All of the above states have created massive barriers to entering into their medical marijuana industries. On the flip side, all four states (Colorado, Washington, Oregon, and Alaska) that legalized recreational marijuana do not have nearly the barriers to entry as these medical states.
Though it makes sense for states to want to closely hew to the priorities set forth in the 2013 Cole memo, setting up ridiculously difficult requirements for licensing eligibility prioritizes the high profits of a few over industry efficiency, true competition, and patient/consumer rights. The medical marijuana states have set up uneven playing fields that give the already wealthy near monopoly power over medical cannabis. How is this a good system for anyone but the few who have bestowed with the spoils?
I can only hope that Colorado, Washington, Oregon, and Alaska will eventually serve as models in in showing how letting the marketplace choose cannabis winners and losers is preferable to patronage systems with high barriers to licensing. So far, these recreational-legal states are proving that market entry equality and the priorities set forth in the Cole memo can be squared.
