Recreational pot escapes Lame Duck unscathed, but advocates still uneasy

Republican Senate Majority Leader Arlan Meekhof’s plan to scale back the state’s newly minted recreational marijuana law is dead — and it never really stood a chance in the Legislature.

But Michigan pot advocates are still uneasy about what’s going on with medical marijuana. Michigan passed the law legalizing weed for medical use back in 2008. On Nov. 6, voters across the state went further and legalized pot for recreational use.

The reason for advocates’ concern is that the politically appointed board of three Republicans and two independents issuing licenses to medical marijuana facilities under a law passed in 2016 is just that: political.

Two experts closely involved in Michigan’s marijuana reform movement separately gave the Michigan Advance the same assessment — the Medical Marihuana Licensing (MML) Board is acting “arbitrarily and capriciously” when issuing and, more importantly, denying licenses.

Moreover, obtaining a license to grow, test, transport, process and sell medical weed is required in most cases for obtaining a license under the state’s recreational law for the first two years.

Robin Schneider, a representative with the Coalition to Regulate Marijuana Like Alcohol, raised concerns about the political makeup of the licensing board, communication taking place behind the scenes, and applicants “not getting their due process” during appeals.

“The licensing board is putting the integrity of the entire program in jeopardy,” said Schneider, who has worked for more than a decade lobbying for marijuana reform in Michigan. “This is going to have to come to a head sooner than later. The board is completely inappropriate.”

Rick Johnson, chair of the licensing board and former Republican speaker of the House, declined to comment before the board’s next meeting on Friday. A live stream of the meeting will be available here.

David Harns, spokesman for the Michigan Department of Licensing and Regulatory Affairs (LARA), said the agency doesn’t “speak for the board.”

Republican public relations executive John Truscott is the spokesman for former Detroit Lions wide receiver Calvin Johnson, who the board denied on Dec. 7 a license to grow, process and sell medical marijuana. Truscott also says the panel acted arbitrarily in denying the license, and that the reasons for denial were based on falsehoods.

Truscott says the next course of action is still being discussed, but it likely delays Johnson’s opportunity for a license.

“When you have cities with a limited number of licenses and someone doesn’t get state approval for a reason that’s questionable, it could preclude them getting licenses,” said Truscott, CEO of Lansing-based Truscott Rossman. “Now [Johnson] gets bumped back. There’s a fundamental unfairness to it.”

Incoming Whitmer administration

Advocates are hopeful that Gov.-elect Gretchen Whitmer and Attorney General-elect Dana Nessel, who are both Democrats, take a close look at the five-member licensing board, which can’t have more than three members from a single political party.

Two board members’ terms expire at the end of 2019; two end at the close of 2020; and one expires at the end of 2022. According to Public Act 281 of 2016, the governor can remove board members for “neglect of duty, misfeasance, malfeasance, nonfeasance, or any other just cause.”

“We’re certainly aware of the issues, we’ll be talking with all parties and evaluating what action — if any — may be appropriate,” said Kelly Rossman-McKinney, a spokeswoman for Nessel’s transition team, who also is Truscott’s former business partner.

Whitmer transition team spokeswoman Clare Liening said medical marijuana is among a review of “all state departments, boards and commissions on a wide range of regulatory issues” before she takes office Jan. 1.

Another criticism of the MML board is the slow pace for approving growing licenses relative to provisioning centers. As of Dec. 7, the panel had approved 45 provisioning center licenses, while just 28 for growers, a trend contributing to a supply shortage. At its Dec. 7 meeting, the board shifted course and approved a resolution allowing dispensaries to buy marijuana from caregivers without being penalized in their license application.

“The irony of all this is for the past eight years, firms that represent caregivers have been defending them against serious felony charges for the exact same behavior,” said Michael Komorn, an attorney and president of the Michigan Medical Marijuana Association.

The board now allows the “organic economic market” that has relied on caregivers for years to operate alongside the state’s regulated “artificial market,” Komorn said.

The supply and demand problem likely will persist, as pot grown in licensed facilities will cost more than twice as much pot grown from caregivers.

“Even when the state gets its act together and has growers harvesting on the state level, you still have to deal with this artificially created market competing with the organic market that’s been around for 10 years,” he said. “This is an issue [applicants] have to be ready for.”

A potential silver lining, Komorn said, is the passage of Proposal 1 and potentially hundreds of thousands more buyers at stores.

“Prop 1 was needed for these businesses to see the profit at the end of the road here,” he said. “It’s going to help tremendously in terms of the adjustment here. It’s imperative we not have an incompetent board that’s going to interfere or use capricious reasons to deny these licenses.”

Lame duck plan falls flat

Meekhof (R-Grand Haven), who is term-limited, sponsored Senate Bill 1243 to scale back the state’s voter-initiated recreational marijuana law. It was dead on arrival in the Legislature.

The bill called for banning home growing; scaling back the tax rate from 10 percent to 3 percent, while diverting revenue from schools and roads; and having a politically appointed board oversee recreational licenses instead of LARA.

Schneider called the last provision a “huge red flag for me.”

Despite Meekhof’s alarm that the recreational law would feed the black market with unfettered home growing, he even admitted it would have been a tough sell to get three-quarters of both legislative chambers to change the law. Voter-initiated laws can’t be altered with just a simple majority, under Michigan law.

Recreational cannabis passed 56 to 44 percent on Nov. 6. Schneider said an intense lobbying effort helped keep the GOP-controlled Legislature from adopting the proposal and thus amending it more easily.

“I’m sure they’re regretting it,” Komorn said.

The Legislature in September adopted voter-initiative minimum wage and paid sick leave laws. After the election, Republicans introduced bills drastically scaling back both measures, which GOP Gov. Rick Snyder already signed last week.

Truscott says there were “so many varied opinions” on the best way to approach recreational marijuana after it qualified to be on the ballot. Ultimately, the proposal was the result of a compromise among several groups, he added.

To Schneider, Michigan voters spoke loud and clear.

“The fact that [Meekhof] didn’t have the votes shows how far our movement has come and the legislators are well aware that voters have spoken and are going to respect that,” Schneider said, adding that the recreational law should be given at least two years to be in effect before lawmakers consider any changes.

“If any technical problems arise in the meantime, that’s a conversation we’re willing to have.”