As many business owners are already aware, Proposition One has passed, and the ownership and use of recreational marijuana are officially legal as of December 6, 2018. Many anticipate that this will further stimulate the growth of the marijuana industry in the state and are looking to get their license to grow marijuana for personal or commercial purposes. But what do you need to know about obtaining a Michigan grower’s license?
The Costs of a License
There are costs that come with the application process, as well as other fees associated with obtaining your license. There’s a non-refundable application fee to offset the costs of LARA and the State Police, of up to $5000. This must be paid before the application is processed. The State Annual Regulatory Assessment offsets operational costs. The exact cost of the regulatory assessment isn’t set yet but will scale depending on which class of license you applied for. Other fees, such as late renewal fees, tax, and costs exceeding the application fee may apply.
There is No Limit to the Number of Licenses Issued
The state is not going to limit the number of grower’s applications that can be provided throughout the state. However, local municipalities with authorization under the MMFLA may choose to restrict the type and number of grower’s facilities licensed within their boundaries.
There Are Three Classes of Michigan Cultivator License
Depending on which class of license you apply for, you will have limitations on how many marijuana plants you can hold. The classes are follows
- Class A growers can hold up to 500 marijuana plants
- Class B growers can hold up to 1000 marijuana plants
- Class C growers can hold up to 1500 marijuana plants
What a Grower’s License Authorizes
Which class of grower license you apply for will determine how many plants you are able to hold in your facility, but it’s important to understand what is and isn’t authorized if you successfully receive your license. The license allows you to purchase marijuana seeds and plants from a provider by way of a secure transporter, and to sell marijuana seeds, plants, and products to medical dispensaries and businesses. A grower’s license is not the same thing as a license to start a medical or recreational marijuana business, which each require their own license.
Changing Your License After the Fact Isn’t Possible
When you apply for a grower’s license, your primary choice is between a Class A, B, or C license. When you file a successful application for any of these licenses, you cannot “upgrade” to a class that would allow you to grow more plants or seedlings. Similarly, you cannot switch from a grower’s license to a business license. You would have to restart the application process, which potentially includes paying as much in fees to get the process started.
A Tracking System is Essential
The transactions of marijuana, current inventory, and a host of other information must be entered into a statewide monitoring system as part of the Marijuana Tracking Act. As such, license holders may have to make use of cultivation seed-to-sale tracking systems in order to provide comprehensive tracking data.
What Prohibits You From Obtaining a License
There are several factors which may potentially prohibit you from obtaining a license. These include:
- Submitting an application with false information
- Being a member of the Medical Marijuana Licensing Board
- Can’t demonstrate the ability to maintain premises liability
- Haven’t been a resident of the state for fewer than 2 continuous years
- Have been convicted or released from incarceration for a felony.
- There are other prohibitions that you can get familiar with through the website of the Michigan Department of Licensing and Regulatory Affairs.
Other factors that may play into your chances of application success
There are other factors that will not prohibit you from obtaining a license but will have some impact on whether your application is successful. These factors include:
- Ability to demonstrate integrity, moral character, reputation, financial stability, honesty, and experience
- Financial ability to purchase insurance
- Ability to pay all other expenses
- Whether you have gone through bankruptcy in the past seven years
- Whether you have ever skipped bail
- If you have a history of tax problems
These are not the only factors that play into your chances of successfully receiving an application, so it’s important to further research eligibility before applying.
Where to Apply for a Grower’s License
If you wish to apply for a Michigan grower license, there are two ways to do it. You can apply using paper forms or by doing it online. These applications are sent to the Department of Licensing and Regulatory Affairs (LARA) and processed by the Medical Marijuana Facilities Licensing for the moment. The application is carried out in two steps. The first is pre-qualification, which includes a background check of the applicant and other businesses or individuals with an ownership interest in the applicant. This is followed by the license qualification, which determines your eligibility for the application. Learning what materials you need for each step is essential and, if you already have a location secured, you can submit materials for both parts of the application process at the same time.
There Are Regulations On Who You Can Sell, Employ, and Transport Through
When buying or selling seeds, a licensed grower must use a licensed transporter. What’s more, growers are prohibited from directly selling marijuana seeds, plants, or other products to patients and may have their license revoked and face prosecution if found to be doing so. Growers must also have at least one employee who has lived in Michigan for at least two continuous years. Registered primary caregivers cannot be employed by a license holder.
With the facts above, you should understand a lot more about what to expect during the application process for a grower’s license, and how to prepare for it. The question of selling recreational marijuana in Michigan is still up in the air, as Proposition One has been passed only very recently and regulatory efforts are ongoing, but the path for obtaining a grower’s license is much clearer.