State releases emergency administrative framework for Michigan’s adult-use cannabis industry

Michigan's new rules for the recreational cannabis industry are not dissimilar to the rules laid out for the state's medical cannabis industry

Bethan Rose Jenkins, Cannabis News Writer/Editorial

At the beginning of July, emergency administrative framework for Michigan’s recreational cannabis industry was issued by the state’s Marijuana Regulatory Agency (MRA). Applicants keen to get involved in the industry have been informed that they can start applying for cannabis business applications from November 1, 2019.

However, based on a limitation contained in last year’s voter-approved ballot initiative, applicants must have already secured licensing for two years under the state’s regulatory framework for the medical cannabis industry; the Michigan Compassionate Care Initiative launched back in 2008.

Overview of rules for participating in Michigan’s adult-use cannabis industry

Anyone who is not already in possession of a license from the MRA must establish a professional medical cannabis facility beforehand. Unlicensed applicants will not be considered unless they have gone down the route of buying a licensed medical facility that was inaugurated by its previous owner. 

Should this be the case, the MRA must first approve the purchase and deem it suitable for the applicant to participate in Michigan’s adult-use cannabis industry. Previously, applications were restricted to State residents, but following a revision of the rules, out-of-state residents are now also invited to apply for involvement in Michigan’s adult-use cannabis industry.

A total of 12 separate license types will be on offer from the MRA, inclusive of cultivation, retail, safety compliance, secure transportation, and micro-businesses. For cultivators, the chosen classification will depend on the number of plants being cultivated. 

According to Michigan’s adult-use cannabis rules, grower licenses will be issued as follows:

  • Class A (maximum 100 plants)
  • Class B (maximum 500 plants) 
  • Class C (maximum 2,000 plants.)

Michigan adult-use cannabis rules: How to apply for a license

Michigan’s new rules for the recreational cannabis industry are not dissimilar to the rules laid out for the state’s medical cannabis industry. To launch a business in the adult-use market, applicants must fork out $6,000 as standard. This application fee is non-refundable for all applicants.

Anyone who is not currently a licensee in accordance with Michigan’s medical cannabis laws will be required to pay an additional $6,000 application fee in order to be considered for acceptance, bringing the total application cost to $12,000. 

Licensees must also consider the annual fees required to maintain a license in the state. Fees are dependent on how many sales a licensee makes in comparison with the size of the market. In essence, this means that businesses taking in more cash will pay more. 

Applicants must undergo background checks into their criminal record and finances in order to pre-qualify for the second stage of review. Retailers will be required to pay between $20,000 and $30,000 on an annual basis, whereas Class C cultivators will be obliged to pay an annual licensing fee in the range of $30,000 to $50,000. 

Click here to apply for a cannabis license in Michigan or, should you require further information, don’t hesitate to read the MRA’s application instruction booklet.