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

You may be considering opening 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, but only if you get 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 formerly referred to colloquially as a "dispensary." The current policies no longer permit such companies 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 organisation where qualifying patients under the Michigan Medical Marihuana Act or the MMMA (M.C.L. 333.26421 et seq.) may come to acquire medical marihuana for medical usage. While a provisioning center can be a rewarding venture, there are a few things you to know before you move forward.

Can You Transport Cannabis In A Private Car?

Presently, under Michigan law, the general guideline is that possession and transport of marihuana in a automobile is restricted by law, and subjects you to criminal penalties. Only registered qualifying patients and registered caregivers under the MMMA may transport marihuana in a automobile. Even then, they must do so in strict compliance with the MMMA. Marijuana may only carried 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 may likewise not have more than 2.5 ounces of usable marihuana, per registered qualifying patient. Caregivers may carry usable marihuana for up to 5 patients (and themselves too if the caregiver is also a qualifying patient) or up to 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 facility 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 transport of the marihuana will not happen on a public road, it can be moved as set forth by LARA, BMMR under the Administrative guidelines.

How Much Marijuana Can You Supply?

A licensed provisioning center under the MMFLA may not sell more than 2.5 ounces of marihuana daily to a registered qualifying patient. A provisioning center that is licensed may likewise sell to a registered primary caregiver, but not more than 2.5 ounces per qualifying patient attached to the caregiver's license. If you are licensed by the State to run a provisioning center, you will have to use a point of sale system that has software that is complaint with the Statewide Monitoring Database, which utilizes a software program called METRC. The State allows using twenty-four (24) software programs that are METRC compliant. Every client 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 goes into a provisioning center has to have their card run through the Statewide Monitoring Database to make sure 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 purchased by the patient at your provisioning center.

What License Do You Need?

You need a full license given by the state to operate as a Michigan provisioning center. If you are growing cannabis, you will likewise need to ensure that you get a Michigan commercial grow license application. You may want to speak with an MMFLA lawyer, such as Fowler & Williams, PLC, about this to guarantee that you are fully licensed, or you will be shut down. Most importantly, DO NOT begin operating your provisioning center without a State license being issued to you under the MMFLA. While the process of acquiring a license is complicated and requires a substantial amount of time and money, the profitability of these provisioning centers far surpasses the cost of acquiring one. If you can qualify for a license and get through the application procedure to get a provisioning center license, you ought to do so before you begin operating.

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 same time. According to the law, there is absolutely nothing stopping you from doing this. Even more, you can acquire multiple provisioning center licenses so that you can operate multiple provisioning centers in various cities. The licenses do not connect to the person or the business that is using, enabling you to use it anywhere you desire. Rather, the licenses attach to the property you provide on your application for the business. For that reason, if you wish to open several provisioning centers, you will have to submit numerous State applications. If you desire to get various types of licenses (say a grow or processor license) in addition to a provisioning center, you can co-locate them at one center, but you should send different applications for each license type, and need to fulfill the minimum monetary and background requirements individually for each license type.

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 different fees, and they can vary the fees depending on which kind of license you apply for. Usually, however, they charge the maximum allowed, which is $5,000.00 per license application. Further, after you get a State license, there are regulatory assessments that will need to be paid every year, both after issuance and each year after when the license is renewed.

In 2018, the assessments differ.

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, regardless of the kind of license provided. For now, nevertheless, the assessments will remain as noted above. You will likewise discover that there are other professional charges that you will need to pay in order to ensure 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 costs can vary drastically, and are tough to anticipate.

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 could be substantial.

Should You Have A Legal representative?

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

Just How Much Will This Business Cost?

You can expect the total start-up fees for this kind of business to be anywhere between 400 and 500K, at a minimum. While the State needs a minimum capitalization requirement of $300,000.00 (one quarter of which must be liquid funds), that will not suffice, realistically, to start the 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 mandatory fees, costs, and professional services that you need to acquire to make sure that your application is accurate and total, and to guarantee that you are presently in compliance with all laws and regulations, along with making sure future compliance. This consists of everything from licensing to a complete group of employees and much more. It's definitely not cheap, and you need to be prepared for a heavy financial investment. However, 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 prohibited to operate one in the state of Michigan. Nevertheless, this could change, and that's why it  is essential to talk to a medical marihuana attorney regularly, so that you are keeping up to date with changes to the law. Cannabis law is an evolving and altering field, and as a result, there may come a time where the MMFLA or the MMMA is amended to enable a mobile provisioning center.

What Are You Legally Able To Do?

As a provisioning center, your sole function is to offer safe medical marihuana to registered qualifying patients. You might only sell marihuana or marihuana infused items that were grown by a MMFLA licensed grower or processed by a MMFLA licensed processor and the items have been tested by a MMFLA licensed safety compliance facility with correct labeling and tracking. You may not sell these products prior to your getting a license, unless you were running with city approval prior to February 15, 2018 and you have already submitted an application to the State looking for 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 policies and starts accepting licensing applications, only centers licensed by the MMFLA to offer, grow, process, transport or test medical marihuana will be legally permitted to get recreational marihuana licenses for the same activity. Hence, getting a provisioning center license under the MMFLA, offers you the chance to go into the recreational market, where others will not.

What Are The Requirements?

In order to obtain a provisioning center license, you need to ensure 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 also have to get an properly zoned building in a city or township that has "opted-in" to the MMFLA to permit such facilities to operate within their limits. Whether your own it or rent it does not matter, but you must have the structure. After that, you will have to produce a business plan which contains all of the required aspects 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 adhere to the State's regulations 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 procedure is costly, complex and time consuming, but the benefit and ROI can be substantial. In reality, getting a proficient MMFLA and MMMA lawyer, like Fowler & Williams, PLC, can help streamline and simplify the application process, and take most of the work off your plate.

If you want details, or wish to come in and speak about requesting a provisioning center license, we would enjoy to have you come in for a consultation.