10 Things You Need To Know Before Opening A Marihuana Provisioning Center

You may be considering starting a marihuana provisioning center in Michigan. Now, after the passage of the Medical Marihuana Facilities Licensing Act or the MMFLA (M.C.L. 333.27401 et seq.) that is possible, however only if you obtain municipal approval and a State issued operations license. "Provisioning Center" is the legally acceptable term under Michigan's Bureau of Licensing and Regulatory Affairs, Bureau of Medical Marihuana Regulation, for what was previously referred to informally as a "dispensary." The existing policies no longer permit such businesses to be referred to legally as "dispensaries" and the State requires that they be referred to as marihuana provisioning centers. A provisioning center is basically a business where qualifying patients under the Michigan Medical Marihuana Act or the MMMA (M.C.L. 333.26421 et seq.) can come to purchase medical marihuana for medical usage. While a provisioning center can be a rewarding venture, there are a couple of things you to know before you move forward.

Can You Transport Cannabis In A Private Automobile?

Presently, under Michigan law, the general rule is that possession and transport of marihuana in a vehicle is prohibited by law, and subjects you to criminal penalties. Only registered qualifying patients and registered caregivers under the MMMA can transport marihuana in a automobile. Even then, they have to do so in strict compliance with the MMMA. Marijuana may only transported in a locked, closed container in the trunk of a vehicle, where it can not be accessed by the driver or persons in the guest compartment. You might also not have more than 2.5 ounces of usable marihuana, per registered qualifying patient. Caregivers can transport usable marihuana for up to 5 patients (and themselves also if the caregiver is also a qualifying patient) or as much as 12 plants per patient (again, including plants for the caregiver, if they are also a qualifying patient). Under the MMFLA, nevertheless, provisioning centers that are licensed by the State and their local municipality, must only accept marihuana into their center that is brought by a MMFLA State Licensed Secured Transporter, or, if they have a grow or processing center co-located ( connected to or on the same property) and transportation of the marihuana will not take place on a public roadway, it can be moved as stated by LARA, BMMR under the Administrative rules.

How Much Cannabis Can You Offer?

A licensed provisioning center under the MMFLA may not sell more than 2.5 ounces of marihuana each day to a registered qualifying patient. A provisioning center that is licensed may likewise sell to a registered primary caregiver, however not more than 2.5 ounces per qualifying patient attached to the caregiver's license. If you are licensed by the State to operate a provisioning center, you will have to utilize a point of sale system that has software that is complaint with the Statewide Monitoring Database, which uses a software program called METRC. The State allows the use of twenty-four (24) software programs that are METRC compliant. Every customer who goes into a provisioning center, you will have to utilize a point of sale system that has software that is compliant. Every client who enters a provisioning center must have their card run through the Statewide Monitoring Database to guarantee that they have not already been provided their maximum daily quantity of 2.5 ounces from another licensed provisioning center. A provisioning center needs to likewise update the qualifying patient's profile on the Statewide Monitoring Database after sale, so that the Database will show how much medical marihuana was bought by the patient at your provisioning center.

What License Do You Need?

You need a full license provided by the state to run as a Michigan provisioning center. If you are growing marijuana, you will also require to make certain that you apply for a Michigan commercial grow license application. You may wish to talk to an MMFLA legal representative, such as Fowler & Williams, PLC, about this to ensure that you are fully licensed, or you will be closed down. Most importantly, DO NOT begin running your provisioning center without a State license being issued to you under the MMFLA. While the process of acquiring a license is intricate and requires a significant amount of time and money, the success of these provisioning centers far exceeds the expense of obtaining one. If you can qualify for a license and get through the application process to obtain a provisioning center license, you ought to do so before you start running.

Can You Get More Than One License?

Yes, you can apply and qualify for more than one license. This is useful for any business or person who wishes to establish a provisioning center and a grow or processor at the very same time. According to the law, there is nothing stopping you from doing this. Further, you can acquire several provisioning center licenses so that you can run numerous provisioning centers in different cities. The licenses do not connect to the person or the business that is using, enabling you to utilize it anywhere you want. Rather, the licenses attach to the property you list on your application for the business. For that reason, if you want to open multiple provisioning centers, you will have to send several State applications. If you want to get different kinds of licenses (say a grow or processor license) in addition to a provisioning center, you can co-locate them at one center, however you need to submit separate applications for each license type, and must satisfy the minimum monetary and background requirements independently for each license type.

Just How Much Will A License Cost?

The cost for the license application to the State is $6,000.00 per application, regardless of license type applied for, including for a provisioning center. There are also municipal application costs, which can be as much as $5,000.00 per application. Each municipality is different, and they can charge various fees, and they can vary the charges depending on which type of license you apply for. Usually, nevertheless, they charge the maximum permitted, which is $5,000.00 per license application. Even more, after you get a State license, there are regulatory assessments that will need to be paid annually, both after issuance and each year after when the license is renewed.

In 2018, the assessments vary.

Secured Transporters and Safety Compliance Facilities (testing labs) have no assessment ($ 0.00).

Class A Growers have a $10,000.00 regulatory assessment.

Class B and Class C Growers, Provisioning Centers and Processors have a $48,000.00 regulatory assessment.

The State has actually stated that starting in 2019 there will be a standardized regulatory assessment that will apply to all license holders, no matter the type of license issued. For now, nevertheless, the assessments will remain as noted above. You will also discover that there are other professional fees that you will need to pay in order to guarantee that your application is complete, and that your business plan, with all of its needed parts, is up to par with the State's application requests. Those expenses can vary considerably, and are tough to predict.

Needless to say, the application and licensing procedure is an expensive endeavor, however in a market that is slated to do about $891,000,000.00 in annual sales this year, up from about $741,000,000.00 in 2017, the return on investment might be considerable.

Should You Have A Attorney?

While not required, you should definitely make certain that you are obtaining recommendations from an MMFLA legal representative before you think about opening a Michigan provisioning center. It  is necessary that you get the very best possible legal advice and that you are following all the regulations and requirements. Only an lawyer experienced in dealing with cases under the MMMA and licensing work under the MMFLA, like Fowler & Williams, PLC, can ensure that you have all the tools and guidance that you need to give your application the best opportunity at success. Failure to make sure that your application is complete, and that it supplies support for your capability to currently comply and guarantee future compliance with the Administrative rules, your application is a lot more likely to be rejected or denied, and your dream of opening a provisioning center brought to an unceremonious ending.

How Much Will This Business Cost?

You can expect the total start-up expenses for this type of business to be anywhere between 400 and 500K, at a minimum. While the State requires a minimum capitalization requirement of $300,000.00 (one quarter of which must be liquid funds), that will not suffice, realistically, to begin business. You will need to potentially acquire land or property in an opted-in municipality. (Here is an up to date list of Michigan Municipalities currently opted-in to MMFLA) There will be obligatory fees, costs, and expert services that you need to acquire to guarantee that your application is accurate and complete, and to guarantee that you are presently in compliance with all laws and policies, as well as ensuring future compliance. This consists of everything from licensing to a full group of workers and much more. It's certainly not cheap, and you need to be prepared for a heavy financial investment. Nevertheless, as noted above, the market is big, and continuing to grow.

Can You Go Mobile?

No, you can not run a mobile provisioning center as it is currently illegal to run one in the state of Michigan. Nevertheless, this might change, and that's why it's important to speak to a medical marihuana lawyer routinely, so that you are keeping up to date with modifications to the law. Cannabis law is an evolving and altering field, and as a outcome, there might come a time where the MMFLA or the MMMA is amended to allow for a mobile provisioning center.

What Are You Lawfully Able To Do?

As a provisioning center, your sole function is to provide safe medical marihuana to registered qualifying patients. You may only offer marihuana or marihuana infused items that were grown by a MMFLA licensed grower or processed by a MMFLA licensed processor and the products have actually been tested by a MMFLA licensed safety compliance facility with correct labeling and tracking. You may not sell these items prior to your acquiring a license, unless you were operating with city approval prior to February 15, 2018 and you have already sent an application to the State seeking a license.

Soon a modification in law will likely enable recreational cannabis sales. If the ballot initiative passes, for the first 2 years after the State passes recreational cannabis facility guidelines and starts accepting licensing applications, only facilities licensed by the MMFLA to offer, grow, process, transport or test medical marihuana will be lawfully allowed to look for recreational marihuana licenses for the same activity. Thus, obtaining a provisioning center license under the MMFLA, gives you the chance to go into the recreational market, where others will not.

What Are The Requirements?

In order to get a provisioning center license, you need to make sure that you do not have a disqualifying criminal conviction, and that you meet the minimum capitalization requirements, which as noted earlier are $300,000.00 with 25% liquid capital. You will likewise need to acquire an appropriately zoned structure in a city or town that has "opted-in" to the MMFLA to allow such centers to operate within their borders. Whether your own it or lease it does not matter, however you must have the structure. After that, you will have to produce a business plan which contains all of the necessary components from the state, including a security plan, facility plan, marketing plan, staffing plan, technology plan, recordkeeping plan, waste disposal plan, and more, showing that you will comply with the State's guidelines now and in the future.

Conclusion

We hope this offers you with some of the information you need before opening a Michigan provisioning center. Needless to say, the process is expensive, complex and time consuming, but the reward and ROI can be substantial. In reality, obtaining a competent MMFLA and MMMA lawyer, like Fowler & Williams, PLC, can help streamline and simplify the application procedure, and take most of the work off your plate.

If you want information, or wish to come in and discuss looking for a provisioning center license, we would enjoy to have you come in for a consultation.

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