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The Law Blogger is a law-related blog that informs and discusses current matters of legal interest to readers of The Oakland Press and to consumers of legal services in the community. We hope readers will  find it entertaining but also informative. The Law Blogger does not, however, impart legal advice, as only attorneys are licensed to provide legal counsel.
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Tuesday, April 18, 2017

Government Positions on Marijuana Evolve

While the federal government turns its back on recreational marijuana, Michigan is prepared to blow the lid off medical marijuana production and dispensation. Government's relationship to the plant continues to evolve.

This blogger recalls when medical and recreational marijuana laws began to sweep the country nearly ten years ago. Back then, a key USDOJ memorandum indicated that President Obama's Attorney General directed the corps of United States Attorneys not to devote resources to marijuana prosecutions in states that legalized the controlled substance for either medical or recreational use.

The Trump Administration, especially through Attorney General Jeff Sessions, has signaled an end to the hands-off approach of its predecessor relative to recreational use of marijuana. This poses a huge roadblock to continued industry growth.

In Detroit, only two of over two hundred applications to operate medical marijuana "centers" were recently approved. The City has taken rigorous actions to shut down the unlicensed -and heretofore thriving- dispensaries. One of our clients reported that a cease and desist letter was tacked onto the door of his shop last month.

Meanwhile, just across the Detroit River, Canada is considering nation-wide legalization in all 9 of its provinces. This is the equivalent of removing marijuana from Schedule 1 of the Controlled Substance Act.

As an industry, marijuana is poised to explode as state laws across the nation are relaxed and as decriminalization takes place. In most medical and recreational use states, industrial warehouse space is suddenly in high demand as skilled growers seek adequate space to produce marijuana.

Some prospective licensees are willing to spend over a million dollars to re-purpose a warehouse for high-output marijuana production. Investors are tripping over each other to prepare for the rare state licensing opportunities that will unfold in December.

Just 8-months before taking applications for 500 and 1000-plant grow licenses and dispensaries, the State of Michigan is poised to earn millions in tax revenues from this relatively new industry. The state's Department of Licensing and Regulatory Affairs [LARA] is gearing up for the new license applicants this December, creating the Bureau of Medical Marijuana Regulation.

The problem for legitimate industry growth continues to be inclusion of marijuana on Schedule 1. As long as marijuana is illegal under the federal Controlled Substances Act, the banks and insurance companies, so vital to industry growth, will remain on the sidelines and marijuana will continue to be a predominantly cash-based industry.

This problem will not stop the artisans that have been growing high-quality marijuana over the past decade. Like craft beers, they will continue to produce a product for which demand seems high and insatiable.

If you need to explore your options regarding the acquisition of one of the several state licenses soon to be available from the State of Michigan, give our law firm a call to schedule a free consultation.

Post #588

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