Communities across Michigan deciding on opting in or out of medical marijuana business

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Local officials are beginning to decide if they want medical marijuana businesses in their communities before the state starts giving out licenses next year.
Wochit

To weed or not to weed? That is the question for Michigan’s communities.

As the state board that will regulate Michigan’s new medical marijuana law begins to craft the rules that will govern the multimillion dollar industry, the state’s cities, townships and villages must decide whether they want in or out.

As they are making their decisions, local officials are being bombarded with phone calls from people who want to gain a foothold in the medical marijuana business and are promising untold riches for the communities that let them in.

“Our development department gets calls every day,” said Ferndale Mayor Dave Coulter. “Because we’re Ferndale and a very progressive community, people assume we’ll participate in some way.”

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And Ferndale probably will allow medical marijuana businesses into the Oakland County city, Coulter said. But the city council is being careful and deliberative on how many, what type and where medical marijuana businesses can locate within the city’s borders.

“We’re essentially starting from scratch and asking ourselves which of the five licenses that we want to participate in and to what extent,” Coulter said.

Under Michigan’s original medical marijuana law that was approved by voters in 2008, caregivers could grow up to 12 plants for each of six medical marijuana cardholders. Right now, there are 240,000 people who have gotten medical marijuana cards that allow them to use weed legally to treat a variety of ailments. They are served by 40,000 state-approved caregivers.

 The law passed by the Legislature last year regulates and taxes the industry and creates five categories of licenses — those for growers who can produce up to 1,500 plants; processors; transporters; testing facilities, and dispensaries. The dispensaries will be taxed 3% on their gross receipts, and that money will go back to the state and local communities.The communities — 276 cities, 257 villages and 1,240 townships — have time to make their decisions on whether to opt in or out of the medical marijuana business. Applications for the five categories of licenses won’t be available until Dec. 15, and the Michigan Medical Marijuana Licensing Board won’t begin issuing licenses until early next year after conducting extensive background checks on the business owners.

But a medical marijuana business can’t even begin the process to get a license from the state until it has gotten approval from the community where it want to locate.

Some communities have already jumped on the medical pot bandwagon, passing ordinances that will bring a variety of new business to their towns. According to an unofficial list developed by the Cannabis Legal Group, a Royal Oak law firm that represents medical marijuana clients, so far, six municipalities have passed ordinances, 25 more are likely to pass ordinances in the near future and 14 communities have decided to stay out of the business.

“It became really obvious me that this is what people want,” said Barton Morris, the principal attorney at the Cannabis Legal Group. “The number one question I get is, give me a list of the cities who want in.”

In Bay County’s Bangor Township, local leaders passed an ordinance in July that would allow up to 50 growing facilities, 10 processors, six dispensaries, five testing facilities and five transporters. Like most communities, the facilities can’t be within 1,000 feet of schools, churches, or parks and can only operate from 8 a.m. to 8 p.m.

Township Supervisor Glenn Rowley said while he’s happy about the added tax base that will come to town, he’s more enthusiastic about job opportunities for township residents and having long vacant buildings put back into productive use.

One company that wants to start a marijuana growing operation has purchased a former Dow Chemical commercial pipe building that has only been used for storage for the last 20 years.

“Ford and General Motors are not looking to put a plant in Bangor Township, so this is something that fits. I now know that there is a good use for a lot of old buildings that would otherwise be rubble in a few years,” Rowley said. “We need to embrace this. It’s not a Cheech and Chong movie. It’s not hippies selling pot out of the back of the van.”

Other communities are more conservative. In Marshall, the city restricted the areas where facilities can be placed to two industrial zoned areas, leaving room for only four or five businesses in the town. One company — Michigan Great Lakes Farms — has already purchased 25 acres in one of the industrial zones, gotten a site plan approved by the city and plans to apply for a state license to grow up to 1,500 marijuana plants, said city manager Tom Tarkewicz.

While Marshall’s ordinance also allows for permits for testing, processors and transporters, there will be no retail shops where medical marijuana can be sold.

“We got a clear understanding from people at our public forum,” said Mayor Jack Reed. “They were concerned about the sales in our community and didn’t want it.”

Other communities don’t want medical marijuana businesses in their community at all. The City of Monroe opted out, for now, because the state hasn’t come up with the rules and regulations yet that will govern the industry.

“There are a lot of people trying to position themselves to operate, and we didn’t know what the regulations are going to be. The best thing for us was to take a break,” said Vince Pastue, Monroe city manager. “We’ll do a reassessment in 2018.”

But in Grass Lake Township, elected officials just said no to pot.

“It’s a gateway drug to heroin. The marijuana today is much more potent than several years ago and much more addictive,” said Township Supervisor Jim Stormont. “People have been calling in, wanting to buy land and saying, 'If you legalize marijuana, your state, township and schools can benefit financially.' But Grass Lake is financially secure. We don’t need the money, and the side effects outweigh any benefits.”

Some cities — such as Detroit and Ann Arbor — have already allowed dispensaries to operate, but don’t yet have ordinances passed by their city councils.

Detroit has approved permits for seven dispensaries that currently are operating under the existing medical marijuana law. Another 70 dispensaries are in the approval process and are operating, and 174 shops have been closed by the city. An ordinance to deal with the other categories of state licenses has been drafted, said assistant corporation counsel Kim James, but it will be up to the city council to approve the ordinance and determine how many licenses will be issued in each category when the council returns from its summer break next month.

The businesses that are already operating will have a leg up when it comes to getting a state license because they’ve already gone through the permit approval process in the city.

“We’re assuming that most of them are going to want to switch to provisioning centers under the new law,” James said.

The City of Troy has approved permits for 59 growers under the existing law, but has put a moratorium on any new grow permits, said assistant city attorney Allan Motzny.

“The city council has not made a determination yet if they’re going to opt in or out,” he said.

Current businesses, however, operate and buy land at their own risk. While communities must make the initial decision on whether and who to allow in, it will be up to the state to grant the license.

“The Medical Marihuana Licensing Board will approve a facility’s license application on a case-by-case basis,” said Jason Moon, spokesman for the Department of Licensing and Regulatory Affairs, the agency working with the licensing board.

Also In the back of most communities' minds is what will happen if a proposal to fully legalize marijuana for recreational use gets on the 2018 ballot and is passed by voters. The proposal also allows municipalities to opt in or out of the marijuana business and imposes a 16% tax on the product that will be returned to roads, schools and local communities.

"Local communities are grappling with having to implement something without crystal clear directions from the state," Ferndale's Coulter said. "And we don’t want to do something that would be totally upended by a further expansion of the state law. We’re trying to predict the unknown.”

The Michigan Medical Marijuana Licensing Board is scheduled to meet at 1:30 p.m. today at Kellogg Center in East Lansing.

Contact Kathleen Gray: 313-223-4430 or kgray99@freepress.com. Follow her on Twitter @michpoligal.

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