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Cannabis comes to the Midwest: Michigan becomes 10th states to legalize recreational marijuana

By Rick Schettino
Dec 06, 2018

Michigan, the first Midwestern U.S. state to legalize the recreational use of marijuana officially lights up today, as the Michigan Regulation and Taxation of Marijuana Act, or Proposal 1, takes effect. The initiative passed with 56 percent of voters showing support for the measure. Michigan is the 10th U.S. state and the second-most populous one to legalize marijuana for adults 21 and older and the ninth state to mandate the creation of a regulated and taxed market for adult-use marijuana.

Although it is now officially legal for adults 21 and older to grow and possess marijuana, it’s going to be some time before most of the state’s residents can purchase the drug at a licensed retail outlet without a medical marijuana card.

While smoking is prohibited in public under the new law, residents and visitors to the state are allowed to carry up to 2.5 ounces of dried flower or store up to 10 ounces at home —that’s about $2,500 worth, or enough for about 500 joints, give or take. A limit of 12 plants is set for home grows, and a provision in the measure allows landlords, businesses, and campuses to prohibit smoking.

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According to officials on the licensing board, retail shops won’t be able to sell recreational pot for at least another year as the legislation gives the state until December of 2019 to develop a regulatory and licensing scheme. That gives municipal governments time to decide if they wish to allow retail sales. As with the state’s medical marijuana law, local governments have the option to further regulate or limit the numbers of marijuana businesses within its borders or ban them altogether. Some have already opted out.

There is, however, a small loophole that will surely be exploited. Just in time for Christmas, gifting up to 2.5 ounces of marijuana is allowed under the law. That means that those holding medical marijuana cards can legally purchase marijuana and gift it to friends and family.

In addition to licensing and regulation issues, state regulators must also draft rules governing advertising, marketing, labeling and packaging of cannabis products.

“The Department of Licensing and Regulatory Affairs will be spending the next year translating all of that into the application, what the application looks like. How the rules are going to be administered,” said David Harns, Department of Licensing and Regulatory Affairs.

Michigan enacted medical marijuana legislation back in 2008 which allowed residents to grow their own cannabis for medicinal use. It wasn’t until 2016 that the state enacted a regulatory system allowing the cultivation and sale of medical marijuana. Currently, hundreds of applications are being reviewed by the Department of Licensing, with 67 licenses approved so far. Forty of those were awarded to dispensaries.

Cannabis advocates in Michigan react

Matthew Schweich, Deputy Director of the Marijuana Policy Project, served as campaign director for the Yes on 1 campaign. Schweich said in a statement, “In addition to ending the needless arrest and prosecution of thousands of adult consumers, this will allow law enforcement officials to spend more of their time and attention on serious crimes.”

[Cannabis stock report: Aphria continues to slide as Vic Neufeld loses control of the narrative]

Erik Altieri, Executive Director of the National Organization for the Reform of Marijuana Laws, said in a statement, “The legalization of the adult use of marijuana in Michigan represents a victory for common sense public policy while delivering yet another body blow to our decades-long failed prohibition on marijuana.”

Social justice was a keystone in the campaign to approve the law. “Instead of continuing to arrest over 22,000 citizens a year for marijuana-related charges,” said Altieri, “Michigan will now be able to reallocate precious law enforcement resources to combat violent crime while respecting civil liberties and advancing racial justice.”

Tinkering to the new law begins

Although changes to a ballot initiative require a three-fourths majority of both the state House and Senate to make any changes. Nonetheless, in a lame duck session, the state’s outgoing Senate Majority Leader Arlan Meekhof has introduced a bill that would prohibit home grows and drastically change the tax structure established by the law.

Although the proposal is considered unlikely to come to a vote, the move is being vehemently opposed by advocates. “Home cultivation is a vital component of Michigan’s new law, and this policy is consistent with those policies regulating alcohol — which permit home brewing,” Said NORML’s Altieri. “Fifty-six percent of Michigan voters approved Proposition 1. Politicians should respect the will of the electorate; they should not be seeking to undermine them.”

Some highlights of the campaign

The language to appear on the ballot was approved on May of 2017 by the state Board of Canvassers. Then, in December of 2017, the Coalition to Regulate Marijuana Like Alcohol, a pro-legalization group behind the initiative, turned in more than 360,000 signatures calling for the initiative to be placed on Michigan’s November 2018 ballot.

In late October, the group reported that it had received more than $230,000 from New Approach Political Action Committee between May and October. New Approach has supported cannabis ballot measures in other states in the past.

In response to the initiative, prohibitionist group Healthy and Productive Michigan reported contributions totaling $125,000. Of that, according to cannabis news site Marijuana Moment, $50,000 came from Business Leaders for Michigan, with another $50,000 from ITC Holdings. Fannie Lou Hamer PAC donated $15,000, and billionaire William Parfet donated $10,000. In total, the Prop 1 opposition campaign spent nearly $350,000 on broadcast television ads and roughly the same amount on cable television ads.

[Cannabis stock report: Big tobacco saves Cronos; Aphria plummets as short-seller shenanigans continue]

Highlights of the campaign included a string of appearances by celebrity travel show host, Rick Steves. Steves was one of the first celebrities to campaign on behalf of the marijuana legalization initiative in Michigan.

Since 2012 when Steves campaigned for passage of adult-use laws in his home state of Washington, he has made appearances across the country stumping for cannabis reforms. Steves said he's not pro-marijuana, but pro-civil liberties.

As the campaign heated up, a group of prosecutors, law enforcement and health officials expressed their opposition in six press conferences held around the state.

A crucial endorsement for the initiative came from one of Michigan’s largest media outlets, The Detroit Free Press. And in the week before the election, the National Business League, the country’s largest business organization representing Black-owned businesses endorsed the measure.

In another interesting turn of events, at least two Michigan television stations pulled political ads which they said were promoting false claims. The ads, which were paid for by the prohibitionist group Healthy and Productive Michigan, claimed that the initiative would allow for “unlimited potency” cannabis products.

The spots incorrectly stated, “Legalized marijuana allows ice creams, cookies and candies with unlimited potency, making its way into our schools and playgrounds, putting the lives of our children and grandchildren at stake.”

The YES on 1 campaign informed two stations, WWMT and WPBN, that the claims were false. Both stations agreed to stop airing the ad. Then, in the group’s replacement ad, it was falsely claimed that marijuana tax revenue in Colorado had not benefited Denver schools or students.

[Aphria shares plummet as short-sellers have investors doubting Vic Neufeld]

In the final days leading up to the election, a national group of retired law enforcement officers known as Law Enforcement Action Partnership endorsed Proposal 1. LEAP Executive Director Neil Franklin said in a statement, “When you legalize and regulate marijuana, you can refocus law enforcement energy and resources toward violent crime and other issues impacting the community.”

Josh Hovey, the spokesperson for Coalition to Regulate Marijuana Like Alcohol said on the group’s blog, “The Proposal 1 campaign boiled down into one of fact versus fear. The data from the nine other states to have legalized marijuana made clear that regulation and taxation are a better solution. Legalization of marijuana will end the unnecessary waste of law enforcement resources used to enforce the failed policy of prohibition while generating hundreds of millions of dollars each year for Michigan’s most important needs.”

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