Recreational use of marijuana is likely to go on Michigan’s November 2018 ballot. Here’s what that means to you.
by Patrice Johnson
Organizers of a petition drive submitted 375,000 signatures to the Secretary of State on November 20, more than enough support to have the question of recreational marijuana put on next fall’s ballot. If passed, according to the Associated Press, people 21 and older could possess up to 2.5 ounces of marijuana and grow up to 12 plants at home. A 10 percent tax on marijuana would be assessed on top of the 6 percent state sales tax.
As Michigan voters prepare to decide whether to legalize adult recreational marijuana, investors nationwide are training their sights on the Great Lakes State. The Stockbridge area, strategically located between Ann Arbor, Jackson and Lansing, is in their crosshairs.
“There’s a ton of support for this, and we’re going to have people and groups from all over the country who are going to support our effort,” said Robin Schneider, finance director of the organization that circulated the petition, the Coalition to Regulate Marijuana like Alcohol. “We’ll find financial support coming from all over the country.”
Michigan is about to attract a yearlong onslaught of marketing because Gold-Rush-sized money is at stake, and legalization is all about money.
“Michigan would be a massive market. It would definitely rank up there with the top recreational markets,” said Chris Walsh, editorial and strategic development director of Marijuana Business Daily, which tracks the marijuana market nationally and internationally. “You’ve got a fairly big state. You could draw from other regions. It would be a substantial market.”
Currently, experts estimate $711 million in annual Michigan medical marijuana sales is generating $21 million in tax revenue. Brant Johnson, who represents a client with property in Stockbridge, claimed that Ingham County has 8,000 registered patients and caregivers.
If full legalization happens, that number is expected to surpass $1 billion in sales a year, the Detroit Free Press reported on November 20. “Colorado, the first state to fully legalize marijuana, is about half the size of Michigan and is projected to have more than $1.5 billion in sales of medical and recreational marijuana this year.”
If Michigan legalizes recreational marijuana, it would join ranks with seven other states and the District of Columbia, and it would become the second-largest market behind California. The California market, which begins its recreational usage rollout in January, is expected to grow to $5 billion when it becomes fully mature in a few years, Walsh said.
Nancy Whiteman, the founder and owner of Wana Edibles in Denver, summarized the scenario. “I think when you have a state like Michigan that has a large population, it can be self-sustaining as a business opportunity just in the medical marijuana market,” she said. “But if you get a foothold in the business and then it goes recreational, the market grows exponentially.”
Another reason for the concerted push for Michigan to legalize is that only Michigan and New Jersey are expected to have the issue on their ballots in 2018. This makes Michigan “one of the last two standing, and they need to fall,” Walsh said.
According to A.P., organizers hope to raise $8 million. In contrast, as of October 20, an opposition committee had raised just $5,000. Despite strong verbal disapproval and dire warnings from Michigan State Police, local school boards, health, wellness, parent and youth organizations, opposition funding is out-gunned, out-manned, and out-organized by an order of magnitude.
Last month, more than 18,000 people and 678 vendors gathered in Las Vegas for MJBizCon, the pre-eminent conference about the cannabis industry. There, “the common thread was Michigan’s soon-to-explode marijuana business,” the Free Press reported.
In 2008, Michigan voters approved a medical marijuana statute, but marijuana businesses were not mentioned and have been operating in a gray zone ever since. But on December 15, 2017 applications for five categories of licenses — growers, processors, testers, secure transporters and dispensaries — will become available from the state Department of Licensing and Regulatory Affairs (LARA). By March or April, the Michigan Medical Licensing Board expects to begin awarding licenses (Lansing State Journal, November 17).
The transition to a fully regulated market will make medical marijuana more readily available through licensed sources in communities that decide to allow the businesses. But not just businesses are gearing up. Townships and the state government are eyeing a potential mother lode of new tax revenues and licensing fees.
In fact, small operators may want to think twice before charging headlong into the Michigan marijuana Gold Rush. Mom-and-pop shops need not apply.
LARA has set the license application fee for each of the five medical marijuana licenses at $6,000. That amount will mound on top of up to $5,000 that local communities can charge for permits. The regulatory assessment fee the state will charge is expected to run from $10,000 to $57,000. In sum, licensing fees could range from $21,000 to $68,000.
“Michigan has no idea what’s coming,” said Hilary Dulany, whose Michigan-based company, Accuvape, sells a vaporizing device for marijuana-infused oils and cartridges around the country.
If true, her claim may well apply to Ingham County and the Stockbridge area.