State expects draft recreational marijuana rules by June
Lansing — The state's Bureau of Marijuana Regulation plans to have draft rules ready by June for the commercial production and sale of recreational marijuana.
The issuance of those emergency administrative rules, however, might not occur until later in the year when the department can begin accepting applications for the recreational industry, bureau Director Andrew Brisbo told lawmakers Wednesday.
Under the recreational marijuana law approved by voters in November, the Department of Licensing and Regulatory Affairs has until Dec. 6, 2019, to develop administrative rules and begin taking applications. Should the department issue emergency rules earlier, it also could begin taking applications earlier.
“We can be prepared to do that. Whether we will or not depends on a lot of different factors,” Brisbo told reporters after testifying before the House Oversight Committee.
Short-term emergency rules, such as those put in place when medical marijuana licensing began, are a necessary stopgap to ensure the department meets its December deadline while working its way through the longer permanent rule-making process.
The issuance of the emergency rules must be timed strategically, Brisbo said, to ensure sufficient staffing is in place within the department, the treasury is prepared to begin collecting taxes on the product, and communities have had ample opportunity to opt out of the commercial industry if they desire to do so.
There’s little point in issuing emergency rules and starting to accept license applications prior to those factors being in place, Brisbo said.
“They’re only good for a six-month window,” he said of the emergency rules. “If you use all that up while no one’s getting licensed than it’s not really effective.”
In a Wednesday presentation to lawmakers, Brisbo said the regulated medical marijuana market had brought in roughly $46 million since November as of March 15, with a total of 9,385 pounds of marijuana sold.
So far, the state has approved roughly 121 medical marijuana facility licenses in a slow-moving process that has included license denials, lawsuits and deadline extensions for temporarily operating facilities.
At the end of April, the Bureau of Marijuana Regulation will be replaced by the Marijuana Regulatory Agency, which will oversee the regulation of medical and recreational marijuana and is expected to bring efficiency to the licensing process. The change eliminates the Medical Marihuana Licensing Board and tasks the agency with the review of licensing applications.
Michigan has roughly 293,000 medical marijuana patients registered, one of the highest in the country, Brisbo said. The number of registered medical marijuana patients could taper off when the adult use market is up and running, though some have predicted it could linger because of the lower tax rate on medical products.
Though Michigan has a population of roughly 10 million, the state’s potential market likely will be much larger because it is the first state in the Midwest to legalize, Brisbo said.
The department is “leveraging much of the infrastructure that’s already in place” on the medical side as it prepares for the adult use market, he said. Next week, the department will begin a series of work groups with stakeholders for input on potential administrative rules for adult use.
“The end goal is ensure the regulated market succeeds because the success of the regulated market is what will cause the degradation of the black market,” Brisbo told lawmakers.