Michigan Cannabis Law & Legality in 2021

March 6, 2021 Cannabis Business, Entrepreneurs, Legalization

Cannabis laws and penalties in Michigan are quite different from federal law. As with most states, marijuana regulations in Michigan even differ from the states surrounding it.

With this in mind, our Michigan cannabis CPAs discuss the legality of cannabis in Michigan to shed some light on this budding industry.

Interested in forming a cannabis business in Michigan? Contact us today to learn more about how we can help.

Marijuana Legality in Michigan

While currently a Schedule I controlled substance under federal law, things are changing in many states. This, of course, includes marijuana legality in Michigan.

The Schedule I classification defines drugs as “with no currently accepted medical use and a high potential for abuse.” With this being the case, penalties for possessing or operating a business related to these substances – including cannabis up until recently – carry some rather harsh penalties.

Even though federal-level regulations still restrict cannabis consumption and sales, each state has the opportunity to vote on state laws regarding the industry. This includes state laws for the use, possession, and sale of marijuana, even as it remains prohibited at the federal level.

As of late 2018, Michigan legalized recreational marijuana. Since then, the state has crafted its own set of state laws to regulate the consumption, possession, and sale of it.

Michigan Cannabis Law: Consuming Cannabis

Michigan allows adults over the age of 21 to use cannabis legally. With this being the case, Michigan is the first Midwestern state to welcome the adult-use industry.

However, recreational cannabis consumption in Michigan cannot happen everywhere. Despite updates observable in Michigan cannabis law news stories, the state still limits consumption in some places. 

According to Michigan law, anyone using cannabis in Michigan has to do it in private. This usually means most cannabis consumption is happening at consumers’ residences. Cannabis use in Michigan is not allowed in public places like parks or on the street.

With this in mind, cannabis possession in Michigan is an entirely different subject.

Marijuana possession in Michigan is not illegal. However, specific amounts are carryable depending on where you are. For instance, if a consumer is at home, they can possess up to 10 ounces of marijuana. But it’s illegal to carry beyond 2.5 ounces of cannabis out in public.

Furthermore, it’s crucial to keep in mind that some places in Michigan fall under federal jurisdiction rather than the state’s laws. For example, airports are still viewed as federal property.

With this being the case, federal law prohibits the possession or use of cannabis in an airport, or on any other federal property, for that matter. This means no carrying or smoking in prisons or government buildings.

Michiganians also cannot carry or consume cannabis in any areas frequented by children. This means no marijuana at or near schools or school buses.

Michigan Cannabis Law: Selling or Distributing Cannabis

Adults in Michigan can transfer up to 2.5 ounces of marijuana to another adult as a gift. However, the transfer cannot be promoted to the public.

Besides gifting cannabis, the Regulation and Taxation of Marijuana Act was approved by voters. Thus, the Great Lake State became the 10th state to legalize adult-use cannabis.

Since then, the Michigan Regulatory Agency, or MRA, has been tasked with overseeing cannabis business licensing.

The first announcement claimed that the first 24 months would allow applications from currently licensed Michigan medical marijuana business operators. However, from March 2021, Michigan plans to begin accepting recreational cannabis licensing applications from entrepreneurs looking to dive into Michigan’s recreational cannabis sector.

Cannabis Cultivation in Michigan

Michiganians looking to cultivate cannabis commercially must have a Michigan commercial marijuana growing license. This is the permit that lets people sell marijuana seeds or plants through a secure transporter. Furthermore, those who hold a Michigan commercial cannabis growing license can sell cannabis to provisioning centers or processors.

To be eligible for a Michigan cultivation license, some considerations must be met. For example, you cannot have a safety compliance facility or a secure transporter. This means that you cannot have these kinds of Michigan cultivation licenses if you have a grower’s license.

If you have a Michigan growers license, you’ll also need an active employee who has at least two years of experience working as a registered primary caregiver. As a licensee, you cannot be registered as a primary caregiver.

Michigan Grow License Types

Michigan has two types of commercial grow licenses. Each type has three classes, and the classification depends on how many cannabis plants you’re planning to cultivate.

  • Medical grower classes: A (500 plants), B (1,000 plants), and C (1,500 plants)
  • Recreational grower classes: A (100 plants), B (500 plants, and C (2,000 plants)

Through Michigan’s adult-use program, microbusiness licenses are available. Businesses possessing equivalent licenses with shared ownership are permitted to operate at the same location – without separation – only if the operation does not violate local ordinances, limits, or regulations. The program does not require separate entrances, exits, operations, or point-of-sale areas.

Michigan Commercial Grow License Cost

Setting up a commercial cannabis grow operation in Michigan means paying the application fee and regulatory assessment. However, under the Medical Marijuana Facilities Licensing Act (MMFLA), you might have to pay some additional state-level costs. Applicants might have to pay a fee to their municipality, which could cost up to $5,000.

The state license application fee is nonrefundable and offsets the cost for the Michigan State Police (MSP), LARA, and/or contract costs of investigative services used to conduct background checks on applicants. This non-refundable application fee is $6,000.

You’ll also need an annual regulatory assessment by the state. This must happen before being issued a license and can vary depending on how many licenses the state anticipates it will give. This regulatory assessment doesn’t apply to safety compliance facilities, though.

For a Grower A license, you should expect to pay $10,000. Grower B and Grower C licenses range from $10,000 to $66,000, depending on how many licenses are subject to assessment.

Michigan Cannabis Law Assistance

Interested in becoming part of this budding industry? Contact us today for expert assistance in forming and establishing your Michigan cannabis endeavor.