Ron Strider
Well-Known Member
People looking to break into Michigan's medical marijuana industry would need to come with a lot of capital, per recommendations issued by the Bureau of Medical Marihuana Regulation made public on Tuesday.
The Medical Marihuana Licensing Board is charged with issuing licenses to businesses interested in creating facilities like dispensaries and grow operations under a 2016 law that authorizes them. Part of the law requires the board to ensure applicants have financial ability and experience, along with the means to operate and maintain a medical marijuana facilities.
At its Tuesday meeting, Andrew Brisbo, director of the BMMR, told the board the Department of Licensing and Regulatory Affairs was proposing potential licensees have start-up capital in the following amounts as part of the licensing process:
Grower class A (500 plants) -- $150,000
Grower class B (1,000 plants) -- $300,000
Grower class C (1,500 plants) -- $500,000
Processer -- $300,000
Provisioning center -- $300,000
Secure Transporter -- $200,000
Safety compliance facility -- $200,000
But some board members expressed concerns. Board member David LaMontaine said the required capital could keep some existing businesses from getting licensed under the act.
"It seems to me we're placing barriers to the marketplace," LaMontaine said.
Brisbo said the department had looked at required capitalization levels in other states, as well as required capitalization rates in other heavily-regulated industries in Michigan, like gambling and alcohol, when setting the required capitalization levels. The department also considered costs to the business, like insurance and getting local permits.
"In coming up with these figures... we want to ensure that businesses can thrive and they have the opportunity to enter the industry, but also ensure that they have the appropriate mechanisms to stay in business and be successful in that business related to a lot of those costs that factor in," Brisbo said.
Generally, he said, the department was looking for liquid assets.
During public comment, citizens opposed the proposed capitalization limits.
Rick Thompson questioned why a medical marijuana dispensary would need $300,000 to start up when the capitalization required for a liquor store was $50,000, and wondered who did the calculation that marijuana would be six times as costly.
The board did not answer questions during public comment, but urged people to check back to its website for updates.
Christina Montague, of Ann Arbor, got involved in the industry after her daughter with scoliosis found relief through medical marijuana. She is a caregiver, and wants to get into the cannabis business. But she's a retiree, and the proposed amount of required capital would shut her out.
"We want mom and pops in rural areas that they probably even, some of them won't make $200,000 in a year," she said.
She said the middle-class people she knows don't have that kind of cash.
The board's next meeting takes place on Nov. 28. It begins taking applications for licensing on Dec. 15.
News Moderator: Ron Strider 420 MAGAZINE ®
Full Article: Medical marijuana businesses could need up to $500k to start up in Michigan | MLive.com
Author: Emily Lawler
Contact: MLive contacts, services and support | MLive Contacts - MLive.com
Photo Credit: Shutterstock
Website: Michigan Local News, Breaking News, Sports & Weather - MLive.com
The Medical Marihuana Licensing Board is charged with issuing licenses to businesses interested in creating facilities like dispensaries and grow operations under a 2016 law that authorizes them. Part of the law requires the board to ensure applicants have financial ability and experience, along with the means to operate and maintain a medical marijuana facilities.
At its Tuesday meeting, Andrew Brisbo, director of the BMMR, told the board the Department of Licensing and Regulatory Affairs was proposing potential licensees have start-up capital in the following amounts as part of the licensing process:
Grower class A (500 plants) -- $150,000
Grower class B (1,000 plants) -- $300,000
Grower class C (1,500 plants) -- $500,000
Processer -- $300,000
Provisioning center -- $300,000
Secure Transporter -- $200,000
Safety compliance facility -- $200,000
But some board members expressed concerns. Board member David LaMontaine said the required capital could keep some existing businesses from getting licensed under the act.
"It seems to me we're placing barriers to the marketplace," LaMontaine said.
Brisbo said the department had looked at required capitalization levels in other states, as well as required capitalization rates in other heavily-regulated industries in Michigan, like gambling and alcohol, when setting the required capitalization levels. The department also considered costs to the business, like insurance and getting local permits.
"In coming up with these figures... we want to ensure that businesses can thrive and they have the opportunity to enter the industry, but also ensure that they have the appropriate mechanisms to stay in business and be successful in that business related to a lot of those costs that factor in," Brisbo said.
Generally, he said, the department was looking for liquid assets.
During public comment, citizens opposed the proposed capitalization limits.
Rick Thompson questioned why a medical marijuana dispensary would need $300,000 to start up when the capitalization required for a liquor store was $50,000, and wondered who did the calculation that marijuana would be six times as costly.
The board did not answer questions during public comment, but urged people to check back to its website for updates.
Christina Montague, of Ann Arbor, got involved in the industry after her daughter with scoliosis found relief through medical marijuana. She is a caregiver, and wants to get into the cannabis business. But she's a retiree, and the proposed amount of required capital would shut her out.
"We want mom and pops in rural areas that they probably even, some of them won't make $200,000 in a year," she said.
She said the middle-class people she knows don't have that kind of cash.
The board's next meeting takes place on Nov. 28. It begins taking applications for licensing on Dec. 15.
News Moderator: Ron Strider 420 MAGAZINE ®
Full Article: Medical marijuana businesses could need up to $500k to start up in Michigan | MLive.com
Author: Emily Lawler
Contact: MLive contacts, services and support | MLive Contacts - MLive.com
Photo Credit: Shutterstock
Website: Michigan Local News, Breaking News, Sports & Weather - MLive.com
