Michigan Growers License Insight

March 15, 2021 Cannabis Business, Entrepreneurs, Legalization

Some of the most common questions we receive about getting a Michigan growers license are:

  • How do I become a Class A grower in Michigan?
  • How much is a Class A growers license in Michigan?
  • Can a caregiver sell to a dispensary in Michigan?

Whether you didn’t get a Michigan commercial grow license in 2020 or just recently decided the time is right, here’s some insight into some of the most common questions cultivators are asking.

Interested in getting a commercial growers license in Michigan? Our Michigan cannabis CPAs are ready to assist. Contact us today to learn more about how we can help.

How do I become a Class A Grower in Michigan?

Initial licensing fees to become a Class A Grower in Michigan

Ultimately, this depends on your municipality. Your municipality will need to “opt-in,” which involves writing an ordinance that permits cannabis growing within the municipal borders. There may be a municipality fee involved, but you’ll need to contact your city council to determine whether they have local municipality fees.

Once you do this, you’ll need to pay the State a non-refundable application fee of $6,000. This covers a state investigative service to perform background checks to ensure you and your business partners qualify to receive a Class A grower’s license in Michigan.

Capitalization requirements to become a Class A Grower in Michigan

For anyone applying for a Class A grower license in Michigan, demonstrating you have the capital to start and run the operation is crucial. As you’re applying for your Class A Grower License in Michigan, remember that you’ll need at least $150,000 in business capital to qualify. This can include a minimum of 25 percent in liquid assets that can easily be converted into stocks, bonds, cash, or CDs.

Love this post? Give our other article about Michigan commercial grow license cost a quick read before you go!

How much is a Class A Growers License in Michigan?

Cannabis growers licenses in Michigan start at $4,000 for a Class A Growers License. However, if you decide on another option, you could have to pay up to $40,000. These licenses must be renewed annually for a similar fee.

On the other hand, Class B Growers and Microbusinesses must pay $8,000 for their licenses. If you’re planning to do retail, secure transportation, or operate a Safety Compliance Facility, you can expect to pay $25,000. For Class C Growers, Excess Growers, and Processors in Michigan, you’ll have to pay $40,000 for your license.

The MRA is allowed to increase these license costs by up to 10 percent annually. The renewal fees are contingent on the initial license fee and the license holders’ relative success in comparison to other license holders of the same type. Some licenses cost just $1,000 with the option to renew for $1,000 regardless of other license holders’ success.

The annual renewal fees for cannabis business licenses in Michigan, with an initial fee of $8,000, can increase or decrease by $2,000. This depends on if the license holder is in the top or bottom third of the type of license they hold. The bottom third pays $6,000 renewal fees, the middle pays $8,000, and the top pays $10,000.

For those holding a Class A Growers License in Michigan, there’s a similar method for renewal fees. The initial fee of $4,000 increases or decreases by $1,000 for renewal fees. But for $25,000 licenses, you can expect an increase or decrease by $5,000. $40,000 licenses are adjusted by $10,000 in the same manner.

What kind of Michigan growers license will I need?

The MRTMA offers 11 different kinds of marijuana establishment licenses; these include the following grow licenses:

  • Class A Growers – Growers holding a Class A Growers license in Michigan are allowed to grow up to 100 cannabis plants. They also don’t have to be licensed under the MMFLA. However, these growers cannot stack licenses. License stacking means the entity holds more than one license of that type.
  • Class B Growers – Cultivators holding a Class B Growers license in the Great Lake State are allowed to grow up to 500 cannabis plants. These growers are also not allowed to stack licenses and need licensing under the MMFLA.
  • Class C Growers – For Class C Growers license holders, a grow operation of up to 2,000 cannabis plants is permitted. However, these growers are allowed to stack up to 5 Class C licenses. At this point, they need licensing under the MMFLA.
  • Excess Growers – For Excess cannabis growers, a grow containing up to 2,000 cannabis plants for every MMFLA Class C Grower License help is allowed. But they must have 5 MRTMA Class C Grower Licenses and a minimum of 2 MMFLA Class C Grower Licenses.

Can a caregiver sell to a dispensary in Michigan?

Ganjapreneur reported that Michigan is phasing out caregivers’ access to cannabis licensees. On September 30, 2019, medical cannabis caregivers in Michigan can no longer transfer or sell products to licensed cannabis growers and processors. This is a rule established by the MRA.

In the past, caregivers could transfer cannabis products to some licensed operators. This was to keep product available to medical cannabis patients as the state shifted towards recreational sales. According to the MRA, the under-supply of medical cannabis is no longer an issue since nearly 200 cultivation licenses and more than 25 processing licenses have been issued.

Michigan Growers License Assistance from Northstar

Interested in obtaining a growers license in Michigan? Contact us today for expert assistance from legally starting your grow to maintaining your cash flow – and everything in between!