98 Michigan medical marijuana dispensaries will have to shut down

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A customer purchases marijuana at Harborside marijuana dispensary, Monday, Jan. 1, 2018, in Oakland, Calif. Starting New Year's Day, recreational marijuana can be sold legally in California. (AP Photo/Mathew Sumner)

A list of the 98 dispensaries will be released by the state later this month. In March, the state sent cease and desist letters to more than 200 dispensaries that were operating but didn’t submit applications for licenses, ordering them to shut down.

And yet another emergency rule will require marijuana business owners who have been approved for a license to pay the $48,000 regulatory assessment within 10 days or be forced to shut down until they come up with the money. Currently, 37 marijuana business owners have been approved for licenses, but only 10 have paid their regulatory assessments and are up and running. Of those, 16 were approved last month and 21 were approved on Monday.

The move is meant to separate out the dispensaries who are serious about getting a license and those who just want to operate with little state oversight.

The rules come as the state is trying to transition from the medical marijuana market devised after voters legalized weed for medical use in 2008 to an industry that is regulated and taxed by the state. The old market was made up of caregivers who could grow up to 12 plants for each of five patients as well as themselves. There was little, if any, state oversight of the caregiver-model of medical marijuana.

The new regulated market is much more expensive for business owners and creates five classes of licenses for growers, processors, testing facilities, transporters and dispensaries. Once licensed, the owners have to come up with the regulatory assessment, pay city fees, get their products tested under a more stringent set of state guidelines, and pay a 3 percent tax on the gross receipts of the dispensary as well as the 6 percent sales tax.

“We’re trying to move the process along,” said Andrew Brisbo, executive director of the Bureau of Medical Marijuana Regulation.

The new Dec. 15 deadline is the third time the department has extended the deadline for dispensaries to get a license or shut down. While Brisbo was adamant last month that a Sept. 15 deadline wasn’t going to be pushed again, the department relented after hearing from a group of lawmakers, officials in Ann Arbor and Lansing, and several organizations that were worried about losing access to medical marijuana if many of the dispensaries around the state had to close.

“This extension focuses on ensuring access,” Brisbo said.

The state has received 702 license applications since Dec. 15, including 401 applicants who have submitted full applications, and the review and licensing process has been slow and tedious. Preliminary approval has been given to 72 applicants, while 53 have been denied. And 37 full licenses have been awarded while eight have been denied. The state’s regulatory assessment, which covers the cost to administer and enforce the medical marijuana market, will increase from $48,000 to $66,000 on Oct. 1. Those costs are spread over the state departments of Licensing and Regulatory Affairs, Attorney General, Michigan State Police, Treasury and Health and Human Services.

Michigan voters approved legalizing medical marijuana in 2008 and will consider legalizing weed for recreational use on Nov. 6. If it gets approved by voters, the licensing of recreational marijuana businesses will be the responsibility of LARA, not the politically-appointed board that hands out licenses for medical marijuana businesses.

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