The Michigan Cannabis Regulatory Agency (CRA) held a meeting on September 14, 2022, to three questions regarding a potential license moratorium and whether “excess grow licenses” should be done away with, as covered by MLive.com. Each excess license allows adult use growers an additional 2,000 plants on top of the maximum 10,000 plants allowed under regular Class C grow licenses. Up to five Class C licenses can be “stacked” to equal 10,000 plants, while each “excess license” allows 2,000 more plants to be added to the amount granted by the underlying Class C licenses.
According to the CRA, the following questions were under consideration at the public meeting:
Speakers from the caregiver community, recreational cultivators, and various cannabis industry organizations spoke at the meeting to express opinions regarding the above questions, occasionally interspersed with complaints regarding licensing fees, the evolving caregiver system, and high number of communities that have opted out of the adult use industry.
Most speakers supported the notion of a moratorium, though many expressed support for the continued issuing of licenses to social equity and Native American applicants during the moratorium. Smaller growers from the caregiver community expressed worry about being crowded out of business by multistate operators and operators from Europe, according to one speaker.
The Michigan Cannabis Manufacturers Association (MCMA) spokesperson said the organization was “open to the moratorium,” but qualified the statement by stating they “don’t support a blanket moratorium.” The MCMA further muddled their stance by expressing concern over “the market situation.” MCMA acknowledged low prices and said they “recognize oversupply … but also lack of participating cities [that allow adult use cannabis businesses].” The CRA must “deal with the illicit market,” according to the MCMA. As well, the organization expressed “concern about excess grower licenses,” but wondered “what other licenses might be impacted.”
The National Organization for the Reform of Marijuana Laws (NORML) weighed in at the meeting, pointing out they “disagreed with the creation of excess grow licenses,” referring to the time at which they were memorialized in law. The organization did not take a stand on the moratorium and opined on the small number of communities opting into the cannabis business. NORML did concede that “small farmers would be helped by the moratorium.”
The Michigan Cannabis Industry Association (MCIA) came out in favor of the moratorium; they said they “surveyed their members last spring” and found widespread support for the moratorium. It appears the moratorium has long been under discussion in the state’s cannabis community.
Thomas Levine, a cannabis attorney, said his firm has been against the “excess grower” licenses from the outset, asserting they were beyond the scope of the law. He said he does not support a moratorium because he thinks it might stop “people in [the] process” of obtaining a license.
Overall, the moratorium gained support from speakers representing individual cannabis businesses, while cannabis advocacy and business organizations, NORML and MCMA, did not offer full throated support. The MCIA, however, does support the moratorium.
David Harns, Public Relations Manager for the CRA, said the agency will “take the information gained from the public meeting and internalize it.” The CRA does not have the authority to implement a moratorium and the questions regarding licenses – multiple and excess growing – will be taken up in the next “rules session” after the new year, according to Harns. There is no expected date for the legislature to formulate a bill that would impose a moratorium on cannabis licenses nor a target date for implementation of a moratorium. The alphabet soup of cannabis organizations is likely to weigh in through their lobbyists, according to Harns, although the meeting suggested all players are not on the same page. Stay tuned.
More immediately, plant count data from the CRA indicates a large fall harvest is on the way, which will further pressure prices in an already oversupplied market.