Since recreational legalization kicked in December of 2018, Michigan has become the fastest growing state in the recreational cannabis industry. Already the 2nd largest medical cannabis market in the US, the recreational market in Michigan could reach $1 billion dollars in sales this year, and sales may climb past $3 billion each year in the near future.
With all this explosive growth and excitement about recreational cannabis, it can be easy to forget that your community won’t benefit from the new laws and new tax revenues unless they choose to opt into the new MRTMA laws (Michigan Regulation & Taxation of Marijuana Act).
Here are 5 reasons your community should consider passing a local opt-in ordinance for your city, township, or village.
1. More local jobs & local investment
Now that the state has established the MRA and released finalized rules for recreational cannabis, cities all over Michigan have been opting into the new laws. These early adopters are seeing an increase in local jobs both for contractors engaged in the construction or remodeling for state law compliant cannabis facilities, and for local residents employed by growers, retailers, or transporters.
2. Capitalize on Michigan’s current cannabis tourist destination while it lasts!
Is your community one of the many that benefits from Michigan’s $24.7 billion tourist industry? Already a top destination because of our state's natural glory, since legalization Michigan has become a destination for cannabis tourism on par with Colorado. Luckily, Michigan’s recreational law leaves plenty of flexibility for local regulation, so smart, savvy, and responsible cities and business owners could bring a lot of attention to their community and stand to make a fortune if they can meet this untapped need.
3. Increase your property values!
A 2018 study by libertarian think tank the Cato Institute showed that single-family properties within 1/10th of a mile from a legal, recreational dispensary increased 8.4% more in value than comparable properties in the same cities, but further away. Some cities in Colorado have even seen home values in opt in cities rise at nearly double the national average! On top of this, active cannabis farming usually involves modifications to existing properties that increase the value of the land. This means more property taxes for your local government, which in turn means more funding for local schools!
4. Cities get to keep the licensing fees!
When someone applies for a legal cannabis business license, they pay three different fees. Two of these fees, the pre-qualification fee and license-specific fee, are assessed by the Michigan MRA (Marijuana Regulatory Agency). But the third fee is a licensing and regulatory fee set by the opt in community, and this money is kept in that municipality's general fund. So if your community opts in, they could use the local application fees to fund projects like fixing your local roads, or making sure the fire department has updated safety equipment.
5. Your town doesn’t get any tax revenue if you don’t opt in!
This one is the easiest to explain; if you don’t opt in, you don’t get anything out of the pot! The pot of cannabis tax money that is. According to MRTMA, recreational cannabis will be taxed at the normal state sales tax of 6%, with an additional 10% excise tax on top of that. While the 6% sales tax goes into the State General Fund as usual, the 10% excise tax is split between communities that have opted in and have open provisioning centers. This means if your community chooses to allow recreational cannabis businesses, you could gain access to a new source of millions in local funding!
One of our favorite things to see as marijuana lawyers is when local residents speak up and advocate for reasonable cannabis laws. So please, go to your local city, village, or township council meeting and talk to your local representatives about how much your community stands to benefit by opting into Michigan’s recreational cannabis laws. I hope this information helps you show them the light!
If you think you’re ready to join Michigan’s fastest growing industry, but not sure about your local laws, then give us a call! We’re happy to help you find out if your community has opted in, or help you petition to opt in yourself.