The Newly-Adopted Two-Step Application Process in Michigan

Ben WrigleyNews0 Comments

Michigan’s Bureau of Medical Marihuana Regulation (BMMR) in conjunction with the state’s Medical Marihuana Licensing Board (MMLB) realizes many municipalities have not made final decisions on whether to opt-in or not.  Municipalities are waiting, in many cases, for further input from the BMMR and MMLB on rules and regulations.

Others do not wish to be pioneers.  They want to see what others have done, particularly those in neighboring communities.

In order to facilitate a more efficient processing of license applications, the BMMR and MMLB have adopted a two-step application process. It still is one application, but you can proceed with the first step to become pre-qualified and then complete the second step once you have a municipality and facility location.

This is similar to shelf registration in the securities industry, where paperwork is approved but the security issuer doesn’t go to market until it feels comfortable. In this case, with the lack of municipalities opting in throughout the state, the BMMR and MMLB want to spread out the work.

An applicant utilizing the two-step process will submit an application, with the application fee, with the information and documents required for pre-qualification under step 1.  The list of documents for each step has been published by the BMMR and is available at http://www.michigan.gov/documents/lara/MMFL_Document_Checklist__603945_7.pdf.  This will allow the BMMR and MMLB to pre-qualify applicants based upon background checks, ownership interests, financial basis, etc. That first review will not deal specifically with the proposed business aspects for the proposed licensee for specific locations.

Many of our clients are in the process of utilizing this two-step approach. It vets the ownership group, tests financial strength, gets them in the pipeline, and makes the clients focus on ownership arrangements. While we haven’t seen the form of the state’s application, it is likely that not a lot more will be requested to pre-qualify than what is already listed in the checklist.

The BMMR and MMLB are still working out the details of “capitalization” for each of the licenses and grower classes. There has not been any definitive statement yet as to whether the figures given by Mr. Brisbo at the last board meeting are required to be “in cash” or consist of property assets. Does a building and land of $300,000.00 satisfy a $300,000.00 threshold when you have already bought them with your cash?  This is still to be determined.

So..stay tuned. Changes will be coming quickly over the next few weeks

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