Is The Future Bleak For Marijuana Industry In Michigan?

A Pew Charitable Trusts' study predicts underwhelming response to marijuana legalization for recreational use in Michigan. The US state estimated to mint $1.4 billion-$1.7 billion in annual sales but market researchers are skeptical about the market uncertainties.

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They have cautioned the policymakers of market uncertainties that plague the market and may dampen the spirit of the staunch supporters. 

Some of the areas of concerns hovering Michigan’s Marijuana Industry include

  1. Unprepared Regulatory Model

First and foremost, Michigan has a dual-licensing system. Thus, every trader has to apply for a license from both the state and by the city/county where they are operating the business.  Having failed to comply with either of them deprives you of the right to legally sell marijuana in the state. 

Proposition 1 affirmed that the regulatory landscape need not be complicated like California’s that can prohibit people from ethical trading practices. In fact, it had sent a clear directive to the Michigan DLRA for: 

  • No limit on the number of licenses 

  • Avoid creating impractical rules discouraging interested parties 

 There is only one regulatory unit overlooking the entire operations and functions to avoid replicating the complexities in California’s model.  

2. Grey Or Black Market 

 This is one prominent concern that is hard to ignore. Despite the legalization, there exists a black or grey market that sells marijuana at a cheaper rate than paying high taxes.  

A lingering fear is if Michigan just like its peer state California embraces the high-cost structure for legal marijuana that instead of attracting, pushes away growers, distributors, sellers, and buyers.

The black marketers must be encouraged with tax incentives or exclusive offers to join the legal market and support the state.  

3. Not For Small Businesses? 

 As marijuana is bracketed illegal drug by the federal government, the signature banks will not fund genuine traders and aspiring entrepreneurs. This adds to the financial woes of the hazy marijuana market in Michigan.  

Additionally, it's a high-end market wherein the companies do not enjoy tax breaks like any other industry.  Thus, many small businesses are likely to shun the legal market and support unethical practices to sell marijuana.  

For progressive changes, financial institutions need to 

  • Regularize the market liquidity in the marijuana market 

  • Collaborate with the Michigan DLRA

  • Centralize the financial system to prohibit malpractices

The good news is that the Marijuana Regulatory Agency has discarded the high capitalization costs in Michigan. This is a positive step towards easing things for the people who want to go by the rules of the books! 


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What Lies Ahead For Michigan’s Marijuana Industry? 

 Michigan has opened the doors for legalized recreational marijuana for adults ( age>21) from Dec 2018. The state is slated to earn a 6 % sales tax along with a 10% excise tax on all legal marijuana purchases.

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The state's Senate Fiscal Agency predicts a tax revenue of $180.9 million in the year 2020-21 but the tax sins are hard to calculate. It's a wait and watch situation for the policymakers. 

While the discourse continues where it will work or not, the Michigan Department of Licensing and Regulatory Affairs (DLRA) is refining the policies to make it easy for the participants. 

In all likelihood, the marijuana dispensaries will start opening up by the end of this year and early 2020.  For those looking to grow weeds anywhere in the state, a fully-insured, and secure marijuana transport service can help navigate all the challenges and apprehensions in Michigan. 


Essential Considerations For Marijuana Transportation

Marijuana has been legalized and decriminalized in major parts of the USA. Consequently looking at the potential of this billion dollar market, more and more people are getting involved in farming, harvesting, selling, purchasing and transportation of cannabis. 

There are many rules and regulations that go hand in hand with manufacturing, use, treatment, and transportation of cannabis. You should be aware of every cardinal rule if you are dealing with such business to any iota of extent.

Transportation and exportation of this precious asset from intra- to interstate and beyond the borders is tricky. You will be expected to know these rules and laws regarding the consequences if not followed staunchly. 

While the laws for the transportation of marijuana differs from state to state in terms of leniency but the federal authority keeps its attitude very succinct and ratify that it falls under drug trafficking and considered illegal.

So here the rules to follow ardently to keep the worries at bay:

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State Rule Regarding Transportation Of Cannabis

Cannabis has recently been legalized and the laws are still amended on a very frequent basis. At such a nascent stage, keep your knowledge bank updated. 

You are supposed to adhere to every state’s rules which will vary if you are to transport this plant in any possible version. 

Each state views and analysis this element differently.

For instance, medical marijuana use has been legitimized in the state of Michigan. Under certain guidelines, you can legally use small amounts of the plant, substantially for medical purposes with an appropriate prescription. 

On the contrary, in Colorado state, marijuana has been predominantly legalized, signifying you can use it at your own discretion. It's not necessary to have an authorization, as long as you comply with the regulations that are in place such as being over the age of 21.

While you are planning to jump into the bandwagon, below are some general considerations for state marijuana transportation:

  • A certain state has legitimized the use of cannabis, that state will have certain rules, regulations, and policies administering its transportation.

  • Dynamics vary state to state. From allowances to transport cannabis in the secured quantum packs with a prescription or by a licensed incumbent.

  • If a certain state has ratified that usage, transportation, and harvesting of cannabis is illegal then you are under the disposal of the respective government and compliant to their state regulations.

FEDERAL LAWS FOR CANNABIS TRANSPORT

Federal rules are applicable if you are trying to venture beyond the state demarcation and well beyond the national border of the USA. While the state laws have seen a divergence from state to state but federal laws have been perpetually staunch.

Transporting, processing, distribution of hemp is still illegal under federal laws. Those seeking transportation in the ecosystem where federal laws apply might want to think twice as it can land you up with prosecution under federal law.

FACTORS INFLUENCING FEDERAL LAW

  • Amount of marijuana you are carrying

  • Its form and intended use

  • Financial amounts involved and

  • Criminal history

 The aforementioned factors will determine whether you are subject to federal prosecution or not.

Moving hemp across the state borders or between nations can have grave consequences including landing up in jail, and a hefty fine.  

This is applicable to individuals, group entities regardless of if you are licensed or certified hemp transporter. Invariably, it's the same for a person coming of a state where such activity is legal, illegal or decriminalized.

Abstain from such pursuit as federal incumbents are adamant on this enterprise. It's prudent to wait for any significant change in laws pertaining to state and international borders.

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Some general guidelines for cannabis transportation

Secure Transportation

Transporting marijuana from growers to dispensaries presents a layer of security concerns. The product is high in demand and also valuable so, it has become an obvious choice for the retail crime. 

Make sure the transporter you are hiring is well equipped with basics such as bullet-resistant finishes, GPS tracking system, and many similar advanced security solutions. 

Internal Theft Prevention

A significant proportion of threat comes from the employee itself. There are several steps that a transportation company must take to screen their employees such as background checks.  It is mandatory for transporters to maintain in-store security measures that discourage theft that raises a huge question on their internal security. 

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Shipping Requirements

Everything must comply with federal laws including those governing marking, packing and labeling for all shipments. Any product which can be damaged while transportation due to a sudden change in temperature must be secured by proper packaging. Each shipment should be marked with the name,address, and ZIP code. 

Proof & Delivery Verification

The transportation companies offer proof-of-delivery information for shipments if requested by the sender, recipient with an automatic email confirmation. In the case of same day service, the experts can also provide you with the time of delivery. 

Ensuring cannabis insurance, enhanced efficiency while loading/unloading, providing the right ambient cargo environment are the key aspects for successful product delivery. 

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Why Evergreen?

Every aspect of our business structure is designed to meet and exceed cannabis transportation standards. Expect on-time safe and secured medical cannabis transportation anywhere in Michigan. 

Call us 734.224.5667 right away to know more about our services. You can also write to us at  INFO@EVERGREENLGX.COM for detailed information. 


Director Brisbo meeting: Key takeaways

Director Andrew Brisbo

Director Andrew Brisbo

On Thursday, 7/18, there was another edition of LARA Live with David Harns and Director Brisbo (watch the whole thing here).

Here are some key takeaways:

1) Transferring inventory from medical to adult-use. While the emergency rules allow you to transfer product from your medical inventory to your recreational inventory, Brisbo said that before they allow this, they will want to make sure the needs of the medical market are met. Considering the shortage where in, it looks like adult-use consumers may need to stand-by until seed-to-sale, adult-use product becomes available.

2) The mandatory 90-day license approval or rejection. Brisbo warned that, due to the legislation passed, the licensing agency has 90 days to approve a license or they must reject the applicant. The rejected applicant will then need to reapply, and that presumably comes with an additional application fee. To avoid this, Brisbo suggests you don’t apply for your prequalification and facility approval at the same time. The 90-day period begins from submission of your facility application, not the prequalification. Get your prequalification first, then submit your facility application. Anyone who’s been through the facility-approval process knows that they can take way longer than expected. Don’t risk it!

3) Medical renewal fees. Brisbo mentioned that, just like the adult-use fee structure, medical license renewal fees will be tiered. The renewal fees for 2020 have not yet been released.

4) Marijuana event organizer. This will be a separate license type, without which you cannot organize a marijuana event. Licensed marijuana organizers must apply for permits for specific events, and receive approvals from both the local municipality and the state. Marijuana may be sold at these events by licensed retailers, who were included in the event permit. Fee for the event is partially determined by the number of vendors at the event.

5) Microbusiness structure. These businesses will function as an isolated microcosm in the industry. They cannot buy, or sell, to other licensed facilities. They may grow, process, and sell their product, and theirs alone.

6) Social use. For the time being, retailers may have designated areas for social-use of marijuana products. Those retailers may not serve food or alcohol. Brisbo indicated this was due to complications involved with food, beverage and liquor regulations, both state and federal.

7) Social equity. Businesses from communities disproportionately affected by marijuana prohibition (identified here) may qualify for application and renewal fee reductions of up to 60%! Majority ownership of the business must be from the communities listed, and their fee reduction depends on their particular grievance. Brisbo mentioned that they are gauging the success of their social equity program by how many small business keep their business license for more than 5 years. They are aiming for over 60% of small businesses.

Evergreen Logistics is a secure transportation company, responsible for the safe and timely delivery of your marijuana products and cash assets. While are bread and butter are moving your product, we aim to be a resource to the marijuana community — connecting industry players, supporting policy reform (such as the SAFE Banking Act, and helping promote awareness (like this post!). For more information, shoot us an email at info@evergreenlgx.com or call 248.550.4432. Also find out more at on our Facebook page, and over at Instagram and Twitter.

Industry update: flower shortage

We’re in July, and although there have been licensed marijuana facilities for over half a year, there is a severe product shortage. We get dozens of calls daily from customers looking for flower. Their inventories are running low and growers can’t keep up. And while we are secure transporters — our bread and butter is transporting product and flower — we are actively searching for available product and making those critical introductions. Our customers, accustomed to seeing us as providers of secure transport services, are starting to appreciate that we DON’T only function as B2B transporters; we also connect industry players.

It’s times like these we are reminded that the Michigan marijuana industry is still very much in its infancy. We have a long, long way to go. We just hope no one has to close their doors.

For more information, see our Google Business page, and Facebook page.