Defining Dispensaries at the Heart of a Potentially Disruptive Licensing Issue in Michigan

Bob HendricksNews0 Comments

Within minutes of the opening gavel and the roll call at the August 21 public meeting of the Medical Marihuana Facilities Licensing Board, a board member made a motion to require the board to issue notice that any dispensary conducting operations in Michigan after September 5, 2017 would be denied a license under the Medical Marihuana Facilities Licensing Act (MMFLA).

After some spirited discussion amongst the board members, substantial public commentary, and the application of parliamentary procedural rules, the motion was left undecided. However, the issue of the eligibility of a dispensary (and its operators?) to obtain a MMFLA license is not resolved. The chair of the board made clear that this issue would again be addressed in the near future.

A variety of questions swirl around this topic:

  • Does this board have the authority to adopt licensing policy for medical marijuana facilities?
  • What are the consequences to patients of the adoption and enforcement of such a policy?
  • Is it fair for “grey” market dispensaries to be considered for licensing under the MMFLA?
  • What is the definition of the term “dispensary”?
  • Are a majority of the board members in favor of such restrictions to licensing?

The question of the authority of the board to adopt and enforce a prohibition on licensing “dispensaries” was raised by the Michigan Department of Licensing and Regulatory Affairs (LARA) director of the Bureau of Medical Marihuana Regulation. The director did not state that the board lacked the authority, he merely said that any such action would be reviewed for legal authority.

The provisions of Part 3 of the MMFLA provide some insight into the scope of the board’s authority. The duties of the board are delineated in Section 302. Subsection (d) states that the Board’s duties include “consulting with the department [i.e., LARA] in promulgating rules … to implement, administer and enforce [the] act.”

Section 303(1) provides that the board has the power necessary to “oversee the operation of marihuana facilities.”  Neither of these sections seem to contemplate the adoption of policy that would exclude applicants for reasons not set forth in the MMFLA.  On the other hand, Section 401(1)(l) allows the board to ask about experience and past employment.

Is this the way the “dispensary” question may arise?

Many patients made public comments at the meeting that their ability to safely and effectively obtain particular types of medicine would be substantially undermined by the interruption of the current dispensary system.  To the extent that operators of the dispensary system are willing to take the risk of arrest and prosecution, and certain local governments are willing to not arrest and prosecute those operators, patients seem to be correct that they currently have broader access to medicine than they would likely have where only individual caregivers are the sole source of medicine.

Several would-be licensees spoke in favor of excluding from the licensure process applicants who have operated “dispensaries” that violate the Michigan Supreme Court’s McQueen decision.  The objector’s perspective is that they followed the strict letter of the law (as established by McQueen) and they did not economically benefit like those who operated retail delivery businesses of questionable legality. Their question seemed to be: Why reward Al Capone?

The word “dispensary” is not defined in the Michigan Medical Marihuana Act (MMMA) of 2008 nor in the MMFLA.  Colloquially, the word often means a retail establishment where a patient may acquire medical marijuana from a person to whom the patient is NOT connected as a caregiver under a LARA registration.

But there are many conceivable ways in which medical marijuana could be delivered to a patient in accordance with the MMMA in a “retail” like environment. So, a colloquial understanding is not sufficient to deny a license application. Thus, at a minimum the board would probably be challenged on any rule that did not define “dispensary” and allow the applicant to demonstrate whether the applicant fit that definition.

The August 21 board meeting was attended by four of the five board members. One of those five members made the motion and the chair seemed to support the general intent. That made two of five supporters. Two other members made various comments that might indicate support, but might also indicate opposition. The fifth was absent. Whether a majority of the board would adopt a motion to disqualify dispensaries and operators will need to be seen.

Michigan is not the first state to struggle with the details of how to transition from outlawed marijuana to a licensed and regulated medical system. In some states, the availability of a lawful place in the regulated industry has been a conduit for tension. Let’s hope that Michigan can learn from the actions of other regulators and avoid disruptive actions.

The post Defining Dispensaries at the Heart of a Potentially Disruptive Licensing Issue in Michigan appeared first on Cannabis Business Executive – Cannabis and Marijuana industry news.

Source: Cannabis Business Executive

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