You may be thinking of starting a marihuana provisioning center in Michigan. Now, after the passage of the Medical Marihuana Facilities Licensing Act or the MMFLA (M.C.L. 333.27401 et seq.) that is possible, however only if you obtain municipal approval and a State issued operations license. “Provisioning Center” is the legally acceptable term under Michigan’s Bureau of Licensing and Regulatory Affairs, Bureau of Medical Marihuana Regulation, for what was previously referred to informally as a “dispensary.” The existing policies no longer permit such companies to be referred to legally as “dispensaries” and the State requires that they be referred to as marihuana provisioning centers. A provisioning center is generally a business where qualifying patients under the Michigan Medical Marihuana Act or the MMMA (M.C.L. 333.26421 et seq.) may come to purchase medical marihuana for medical usage. While a provisioning center can be a rewarding venture, there are a few things you to know before you move forward.
Can You Transport Marijuana In A Private Automobile?
Currently, under Michigan law, the general guideline is that possession and transport of marihuana in a car is restricted by law, and subjects you to criminal charges. Only registered qualifying patients and registered caregivers under the MMMA can transport marihuana in a automobile. Even then, they must do so in strict compliance with the MMMA. Marijuana may only transported in a locked, closed container in the trunk of a vehicle, where it can not be accessed by the driver or persons in the passenger compartment. You may also not have more than 2.5 ounces of usable marihuana, per registered qualifying patient. Caregivers can carry usable marihuana for as much as 5 patients (and themselves as well if the caregiver is also a qualifying patient) or as much as 12 plants per patient (again, including plants for the caregiver, if they are also a qualifying patient). Under the MMFLA, nevertheless, provisioning centers that are licensed by the State and their local municipality, must only accept marihuana into their center that is brought by a MMFLA State Licensed Secured Transporter, or, if they have a grow or processing center co-located ( connected to or on the same property) and transportation of the marihuana will not take place on a public roadway, it can be moved as stated by LARA, BMMR under the Administrative rules.
Just How Much Marijuana Can You Supply?
A licensed provisioning center under the MMFLA may not sell more than 2.5 ounces of marihuana daily to a registered qualifying patient. A provisioning center that is licensed may likewise offer to a registered primary caregiver, however not more than 2.5 ounces per qualifying patient attached to the caregiver’s license. If you are licensed by the State to run a provisioning center, you will have to use a point of sale system that has software that is complaint with the Statewide Monitoring Database, which utilizes a software program called METRC. The State permits making use of twenty-four (24) software programs that are METRC compliant. Every customer who sets foot in a provisioning center, you will have to use a point of sale system that has software that is compliant. Every client who goes into a provisioning center must have their card run through the Statewide Monitoring Database to guarantee that they have not already been supplied their maximum daily quantity of 2.5 ounces from another licensed provisioning center. A provisioning center must also update the qualifying patient’s profile on the Statewide Monitoring Database after sale, so that the Database will show how much medical marihuana was purchased by the patient at your provisioning center.
What License Do You Need?
You need a full license given by the state to run as a Michigan provisioning center. If you are growing marijuana, you will likewise need to ensure that you obtain a Michigan commercial grow license application. You may wish to speak to an MMFLA attorney, such as Fowler & Williams, PLC, about this to ensure that you are fully licensed, or you will be shut down. Most importantly, DO NOT start running your provisioning center without a State license being issued to you under the MMFLA. While the process of getting a license is complex and needs a considerable amount of time and money, the profitability of these provisioning centers far exceeds the expense of obtaining one. If you can qualify for a license and get through the application process to acquire a provisioning center license, you must do so before you begin running.
Can You Get More Than One License?
Yes, you can apply and qualify for more than one license. This is useful for any business or individual who wishes to establish a provisioning center and a grow or processor at the very same time. According to the law, there is absolutely nothing stopping you from doing this. Even more, you can acquire multiple provisioning center licenses so that you can operate several provisioning centers in different cities. The licenses do not connect to the individual or the business that is applying, permitting you to use it anywhere you desire. Rather, the licenses attach to the property you provide on your application for the business. For that reason, if you want to open multiple provisioning centers, you will have to submit several State applications. If you want to obtain various kinds of licenses (say a grow or processor license) in addition to a provisioning center, you can co-locate them at one center, but you need to send different applications for each license type, and must meet the minimum financial and background requirements separately for each license type.
How Much Will A License Cost?
The cost for the license application to the State is $6,000.00 per application, regardless of license type applied for, including for a provisioning center. There are also municipal application charges, which can be as much as $5,000.00 per application. Each municipality is different, and they can charge various fees, and they can vary the charges depending upon which kind of license you apply for. Typically, nevertheless, they charge the maximum enabled, which is $5,000.00 per license application. Further, after you get a State license, there are regulatory assessments that must be paid annually, both after issuance and each year after when the license is renewed.
In 2018, the assessments differ.
Secured Transporters and Safety Compliance Facilities (testing labs) have no assessment ($ 0.00).
Class A Growers have a $10,000.00 regulatory assessment.
Class B and Class C Growers, Provisioning Centers and Processors have a $48,000.00 regulatory assessment.
The State has actually said that starting in 2019 there will be a standardized regulatory assessment that will apply to all license holders, no matter the type of license provided. In the meantime, however, the assessments will stay as noted above. You will likewise discover that there are other professional fees that you will have to pay in order to make sure that your application is complete, and that your business plan, with all of its necessary parts, is up to par with the State’s application requests. Those costs can vary drastically, and are tough to predict.
Needless to say, the application and licensing procedure is an costly undertaking, however in a market that is slated to do about $891,000,000.00 in annual sales this year, up from about $741,000,000.00 in 2017, the return on investment could be substantial.
Should You Have A Lawyer?
While not mandatory, you should certainly make sure that you are acquiring recommendations from an MMFLA lawyer before you think about opening a Michigan provisioning center. It is necessary that you get the very best possible legal suggestions and that you are following all the regulations and requirements. Only an attorney experienced in managing cases under the MMMA and licensing work under the MMFLA, like Fowler & Williams, PLC, can ensure that you have all the tools and guidance that you need to give your application the very best opportunity at success. Failure to make certain that your application is complete, and that it offers support for your ability to currently comply and ensure future compliance with the Administrative rules, your application is a lot more likely to be declined or rejected, and your dream of opening a provisioning center brought to an unceremonious ending.
Just How Much Will This Business Cost?
You can expect the overall start-up expenses for this kind of service to be anywhere in between 400 and 500K, at a minimum. While the State requires a minimum capitalization requirement of $300,000.00 (one quarter of which must be liquid funds), that will not be sufficient, realistically, to begin business. You will need to potentially purchase land or property in an opted-in municipality. (Here is an up to date list of Michigan Municipalities currently opted-in to MMFLA) There will be obligatory fees, expenses, and professional services that you need to get to ensure that your application is precise and complete, and to ensure that you are presently in compliance with all laws and regulations, in addition to making sure future compliance. This includes everything from licensing to a full team of staff members and much more. It’s definitely not cheap, and you need to be prepared for a heavy financial investment. However, as noted above, the marketplace is large, and continuing to grow.
Can You Go Mobile?
No, you can not run a mobile provisioning center as it is presently unlawful to operate one in the state of Michigan. Nevertheless, this could change, which’s why it is essential to speak with a medical marihuana attorney frequently, so that you are keeping up to date with modifications to the law. Cannabis law is an evolving and changing field, and as a result, there might come a time where the MMFLA or the MMMA is amended to enable a mobile provisioning center.
What Are You Lawfully Able To Do?
As a provisioning center, your sole function is to supply safe medical marihuana to registered qualifying patients. You might only sell marihuana or marihuana infused items that were grown by a MMFLA licensed grower or processed by a MMFLA licensed processor and the products have actually been tested by a MMFLA licensed safety compliance facility with appropriate labeling and tracking. You may not offer these items prior to your acquiring a license, unless you were operating with city approval prior to February 15, 2018 and you have already submitted an application to the State looking for a license.
Soon a change in law will likely allow for recreational cannabis sales. If the ballot initiative passes, for the first 2 years after the State passes recreational cannabis facility policies and starts accepting licensing applications, only centers licensed by the MMFLA to offer, grow, process, transport or test medical marihuana will be legally permitted to request recreational marihuana licenses for the same activity. Thus, getting a provisioning center license under the MMFLA, gives you the opportunity to enter the recreational market, where others will not.
What Are The Requirements?
In order to make an application for a provisioning center license, you need to guarantee that you do not have a disqualifying criminal conviction, and that you meet the minimum capitalization requirements, which as noted earlier are $300,000.00 with 25% liquid capital. You will also have to obtain an properly zoned building in a city or municipality that has “opted-in” to the MMFLA to allow such centers to run within their boundaries. Whether your own it or rent it does not matter, however you need to have the building. After that, you will need to produce a business plan which contains all of the necessary components from the state, consisting of a security plan, facility plan, marketing plan, staffing plan, technology plan, recordkeeping plan, waste disposal plan, and more, showing that you will abide by the State’s guidelines now and in the future.
Conclusion
We hope this supplies you with some of the information you need before opening a Michigan provisioning center. Needless to say, the process is expensive, intricate and time consuming, however the benefit and ROI can be considerable. In reality, obtaining a competent MMFLA and MMMA lawyer, like Fowler & Williams, PLC, can help streamline and simplify the application procedure, and take the majority of the work off your plate.
If you want information, or wish to come in and speak about making an application for a provisioning center license, we would love to have you come in for a consultation.