MMFLA Application Process | October Update

The Bureau of Medical Marijuana Regulation (“Bureau”) in conjunction with the Medical Marijuana Licensing Board (“Board”) 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 Board and Bureau 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 Board and Bureau 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 Board and Bureau 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 Bureau and is available at http://www.michigan.gov/documents/lara/MMFL_Document_Checklist__603945_7.pdf.  This will allow the Board and Bureau 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 Board and Bureau 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.  

In addition, stay tuned, because changes will be coming quickly over the next few weeks.