by Rick Thompson/October 20, 2017
EAST LANSING- Michigan’s Medical Marihuana Facilities Licensing Act (MMFLA) Licensing Board meetings have created controversy every time they have convened. The latest Board meeting from October 17 was no exception: it included a bombshell of a disclosure from the state, expanded citizen input and the service of a subpoena against one of the Board members.
The entire video can be found online at this address. It has been divided into three different parts for ease of play.
The MMFLA is the law which creates a new, regulated market for medical marijuana to be grown, processed and sold in Michigan. An existing market has flourished since the state passed the Medical Marihuana Act in 2008; one of the areas in which the Licensing Board and its parent organization, the Department of Licensing and Regulatory Affairs, have struggled to address is the transition from the unregulated business environment into the highly regulated MMFLA system.
LARA and its subdivision, the Bureau of Medical Marihuana Regulation (BMMR), administer the MMFLA and the Licensing Board. As part of the agenda for the meeting on October 17 BMMR Director Andrew Brisbo announced the MMFLA’s capitalization requirements of each of the five regulated business types.
The capitalization requirement is not a payment or a fee. It is an amount of assets that a potential MMFLA business owner must prove they can access in order to support the operation of their business during the initial stages of the medical marijuana business program.
Put simply, you must prove to the state that you can afford to start an MMFLA business and keep the lights on even if you are not making any money.
Director Brisbo explained that the state has a capitalization requirement for tobacco stores of $25,000 and for alcohol stores of $50,000.
The capitalization requirements for each of the five business types regulated by the MMFLA are:
- $300,000 for a dispensary
- $150,000 for a grower of up to 500 medical marijuana plants
- $300,000 for a grower of up to 1,000 plants
- $500,000 for a grower of up to 1,500 plants
- $300,000 for a processing facility
- $200,000 for a secure transporter
- $200,000 for testing facility
LARA has previously announced that they will allow ‘stacking’ of Class C grower licenses. A single license carries a proof of assets of half-a-million dollars; those who seek to have three, four, five or more permits will have a greater requirement to prove assets than a gambling casino ($1 million in capitalization requirement, per Brisbo).
When pressed by Licensing Board members to explain the huge increase in capitalization requirements over other ‘sin tax’ industries, Director Brisbo cited capitalization requirements from other states.
Board members and audience participants challenged the figures. Director David LaMontaine referred to them at different times as “predatory” and “un-American.” Director Vivian Pickard also took issue with the numbers, but no explanation from Brisbo seemed to satisfy the sense of shock and apparent outrage expressed by Board and citizens alike.
Citizen input at Licensing Board meetings is typically confined to a Public Comment period at the end of the presentation, and citizen statements have been capped at three minutes each. The October 17th meeting featured four additional opportunities for citizens to comment on actions or discussions of the Board.
The four topics of discussion included daily purchase limits for patients using MMFLA dispensaries (provisioning centers), maximum THC content for edibles and other marijuana infused products, insurance requirements for businesses and the capitalization requirements.
Public comment during these four additional discussions was limited to one minute per citizen per topic. All the comments made and the announcements regarding each different topic are available for viewing on the video at the page listed above.
That includes the moment on the third video when an activist serves a subpoena to appear in court to Licensing Board member Donald Bailey. Bailey is a former Michigan State Police trooper who was involved in many raids against medical marijuana patients and who was captured on video allegedly putting his hands on one of them. The subpoena was to answer an accusation of assault against that patient, Donald Koshmider, who is currently incarcerated as a result of an MSP raid on him.