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Pot board closer to new rules after appointments

Michael Gerstein
The Detroit News
Rick Johnson

Lansing –— Gov. Rick Snyder announced appointments Friday to a board tasked with developing new rules for how the state’s medical marijuana industry would be regulated.

Snyder appointed lobbyist Rick Johnson, a GOP former House speaker with ties to the medical marijuana industry, after he was nominated by Senate Majority Leader Arlan Meekhof, R-West Olive. He will chair the Medical Marihuana Licensing Board.

In 2005 Johnson joined a Lansing lobbying firm started by Democratic former House Speaker Lew Dodak but sold off his interest recently. He helped craft medical marijuana legislation.

The appointments follow Snyder’s 2016 signature on “landmark” marijuana industry overhaul bills that regulate dispensaries and allowed for a 3 percent tax on gross retail receipts at medical marijuana dispensaries. Dispensary purchases are subject to the state’s 6 percent sales tax because of the legislation, too.

The board is expected to design Michigan’s medical marijuana regulations for an industry that is expected to net up to $64 million a year in state taxes, according to a 2016 Senate agency analysis.

Brandon Dillon, chairman of the Michigan Democratic Party, suggested that Johnson’s appointment is ethically questionable given his ties to the marijuana industry.

“I mean it just smacks of corruption,” he said. Dillon said his prior ties and involvement in marijuana regulation “casts a shadow over the legitimacy of the appointment.”

A Meekhof spokeswoman said expertise and experience made Johnson a good choice.

“The majority leader nominated Rick Johnson for his varied experience,” Amber McCann said in a Friday email. “Mr. Johnson is capable and knowledgeable. He will do well in the position.”

The legislation was passed because the voter-approved ballot measure that legalized medical marijuana was vague and prompted several major legal fights. The law now allows licensed dispensaries to operate in communities that allow them, and will license and regulate growers, processers, testing facilities and transporters.

Snyder also appointed people with ties to the pharmaceutical industry, police and business organizations.

Those appointments include Nichole Cover, chairwoman of the Michigan Board of Pharmacy; David Lamontaine, executive board member of the Police Officers’ Association of Michigan; David Bailey, a retired state police sergeant who attended the Drug Enforcement Agency’s Drug Unit Commanders Academy; and Vivian Pickard, a consultant and former General Motors public policy executive.

Snyder’s office says that Cover and Pickard “represent independents,” and the other three represent Republicans because “the law calls for no more than three members of the same party to be on the board.”

Craig Mauger, director of the watchdog nonprofit Michigan Campaign Finance Network, also questioned the ethics of giving former lobbyists and lawmakers a shot at helming powerful regulatory bodies.

“The regulations these people make are going to have a lot of say over who is going to make money,” he said.

The Senate Fiscal Agency in its 2016 analysis estimated a new tax on medical marijuana provisioning centers could pad state coffers by more than $21.3 million a year.

Since medical marijuana dispensary purchases could be subject to the 6 percent sales tax, according to the analysis, the state could reap another $42.7 million annually, although analysts said the sales tax revenue isn’t guaranteed.

Two law enforcement officials were appointed after Oakland County Sheriff Mike Bouchard and others raised concerns about the regulation legislation.

mgerstein@detroitnews.com