Cannabiz Law Blog

The waiting is the hardest part
Every day you see one more card
You take it on faith, you take it to the heart
The waiting is the hardest part

The Waiting, Tom Petty

As late as August, the director of Michigan’s Bureau of Medical Marijuana Regulation insisted that medical cannabis dispensaries temporarily operating must cease operations by Sept. 15, which was an earlier extension of June 15 deadline, with no further extensions.

On Sept. 11, under a rule signed by Gov. Rick Snyder, for the third time the Department of Licensing and Regulatory Affairs (LARA) extended that deadline for some facilities to Dec. 15. Hundreds of applicants are still waiting for their day before the Medical Marihuana Licensing Board.

The rule provides specific requirements for unlicensed facilities depending on their status:

• If applicants who applied on or before Feb. 15 and submitted their Part 2 application after June 15 or have not yet submitted a Step 2 application continue to operate after Sept. 15, LARA will consider their continued operation against them in the application procedure. Further, the state will consider them in violation of the law as an unlicensed activity and refer them to law enforcement. Growers then must transfer plants, seed and seedlings, and processors must transfer plants and usable product, within 30 days, per the Michigan Medical Marijuana Facilities Licensing Act (Act). That product must also be entered into the statewide tracking system within 30 days. News reports indicate that this will likely cause the closure of 98 currently operating locations.

• For those applicants who applied on or before Feb. 15 and submitted their Step 2 license before June 15, they may continue operating in compliance with local authorization for temporary operation up until Dec. 15. However, if they continue to operate after Dec. 15 without a licensed issued by the state, the state will consider the continued operation against the applicant in the review of their application. They may continue to sell product in their possession prior to licensure that has not been tested after receiving their license, provided that they obtain written consent from the patient or caregiver consenting to the sale. However, any product obtained after the date of licensure must be obtained from a licensed facility and must comply with testing requirements.

• Applicants who received approval for a license before Sept. 11, but have not yet received a license, must file their regulatory assessment ($48,000, increasing to $66,000 after Oct. 1) within 10 days. Once the regulatory assessment has been paid, they may continue operating under their temporary local authorization until they are issued a license. Failure to pay the regulatory assessment within the 10 days may result in disciplinary action. Any product in their possession before the date they receive their licenses may continue to be sold, provided they receive written consent from the patient or caregiver. Any product obtained after licensure must be in full compliance with testing requirements.

The rule also applies to those who received licenses prior to Sept. 11. For those license holders, they may return their license to LARA in a manner that LARA has not yet identified. They can continue operating until Dec. 1, at which time LARA will issue them a license. As with the others mentioned in this blog, they may sell product obtained prior to licensure with the written consent of the patient or caregiver, but product obtained after they receive their license must comply strictly with the Act.

While the rollout of medical cannabis in Michigan has been deliberate, there are signs of state approvals picking up and availability becoming easier. There will still be growing pains in the transition, as unlicensed facilities close and new licensed facilities open under new rules governing their operation in excruciating detail. And all of this is occurring under the backdrop of the pending recreational cannabis ballot proposal.

There’s still more waiting to come.