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

You might 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, 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 existing policies no longer allow 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 essentially a company 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 use. While a provisioning center can be a profitable endeavor, there are a few things you to know before you move forward.

Can You Transport Marijuana In A Personal Automobile?

Presently, under Michigan law, the general rule is that possession and transport of marihuana in a automobile is prohibited by law, and subjects you to criminal charges. 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. Cannabis may only transferred in a locked, closed container in the trunk of a vehicle, where it can not be accessed by the driver or individuals in the traveler compartment. You might likewise not have more than 2.5 ounces of usable marihuana, per registered qualifying patient. Caregivers can carry usable marihuana for as much as 5 patients (and themselves also 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, however, 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 (attached to or on the same property) and transport of the marihuana will not occur on a public street, it can be moved as stated by LARA, BMMR under the Administrative guidelines.

Just How Much Cannabis Can You Provide?

A licensed provisioning center under the MMFLA may not offer more than 2.5 ounces of marihuana daily to a registered qualifying patient. A provisioning center that is licensed may also 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 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 utilizes a software program called METRC. The State permits the use of 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 customer who sets foot in a provisioning center needs 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 should 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 supplied by the state to operate as a Michigan provisioning center. If you are growing marijuana, you will likewise need to make sure that you get a Michigan commercial grow license application. You may want to speak to an MMFLA legal representative, such as Fowler & Williams, PLC, about this to make sure that you are fully licensed, or you will be shut 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 getting a license is complex and requires a significant quantity of time and money, the profitability of these provisioning centers far outweighs the cost of getting one. If you can qualify for a license and make it through the application procedure to acquire 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 receive more than one license. This is useful for any business or individual who wants 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. Even more, you can acquire several provisioning center licenses so that you can operate several 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 want. Rather, the licenses attach to the property you provide on your application for the business. Therefore, if you wish to open numerous provisioning centers, you will need to submit multiple State applications. If you desire to get various kinds of licenses (say a grow or processor license) in addition to a provisioning center, you can co-locate them at one facility, however you must send separate applications for each license type, and should meet 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 approximately $5,000.00 per application. Each municipality is different, and they can charge various fees, and they can vary the fees depending upon which kind of license you apply for. Typically, however, they charge the maximum allowed, which is $5,000.00 per license application. Further, after you receive 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 stated that beginning in 2019 there will be a standardized regulatory assessment that will apply to all license holders, regardless of the type of license provided. In the meantime, however, the assessments will stay as noted above. You will also discover that there are other professional charges that you will have to pay in order to guarantee that your application is complete, and that your business plan, with all of its essential parts, is up to par with the State's application requests. Those expenses can vary considerably, and are tough to anticipate.

Needless to say, the application and licensing procedure is an costly venture, 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 roi might be considerable.

Should You Have A Attorney?

While not required, you should certainly ensure that you are getting suggestions from an MMFLA attorney before you think about opening a Michigan provisioning center. It  is very important that you get the best possible legal suggestions 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 very best chance at success. Failure to ensure that your application is complete, and that it supplies support for your capability to currently 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.

How Much Will This Business Cost?

You can expect the overall start-up fees for this type of company 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 buy 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 professional services that you need to get to ensure that your application is precise and complete, and to make sure that you are currently in compliance with all laws and regulations, as well as guaranteeing future compliance. This consists of everything from licensing to a full group of employees and much more. It's certainly not cheap, and you need to be prepared for a heavy investment. Nevertheless, as noted above, the marketplace is big, and continuing to grow.

Can You Go Mobile?

No, you can not run a mobile provisioning center as it is currently unlawful to run one in the state of Michigan. Nevertheless, this might change, which's why it  is necessary to talk to a medical marihuana attorney routinely, so that you are keeping up to date with modifications to the law. Marijuana law is an evolving and changing field, and as a result, 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 purpose is to offer safe medical marihuana to registered qualifying patients. You may 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 appropriate labeling and tracking. You may not offer these products prior to your acquiring a license, unless you were operating with city approval prior to February 15, 2018 and you have already submitted an application to the State seeking a license.

Soon a change in law will likely permit recreational cannabis sales. If the ballot initiative passes, for the first 2 years after the State passes recreational marijuana facility regulations and begins accepting licensing applications, only centers licensed by the MMFLA to offer, grow, process, transport or test medical marihuana will be lawfully permitted to request recreational marihuana licenses for the same activity. Therefore, getting a provisioning center license under the MMFLA, provides you the opportunity to go into the recreational market, where others will not.

What Are The Requirements?

In order to look for a provisioning center license, you need to ensure that you do not have a disqualifying criminal conviction, and that you satisfy 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 municipality that has "opted-in" to the MMFLA to allow such facilities to run within their boundaries. Whether your own it or lease it does not matter, however you need to have the structure. After that, you will have to produce a business plan that contains all of the necessary 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 abide by the State's policies now and in the future.

Conclusion

We hope this offers you with some of the details you need prior to opening a Michigan provisioning center. Needless to say, the procedure is costly, complicated and time consuming, but the benefit and ROI can be significant. In reality, acquiring a competent MMFLA and MMMA lawyer, like Fowler & Williams, PLC, can help streamline and simplify the application procedure, and take the majority of the work off your plate.

If you want information, or wish to come in and talk about requesting a provisioning center license, we would love to have you come in for a consultation.