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April is the annual celebration of National Cannabis Awareness Month and big things are happening in the City of Detroit to mark the occasion with a timely approval of a new ordinance for a 2022 adult-use marijuana policy.
The Detroit City Council voted on Tuesday, April 5, 8-1 to approve the Adult-Use Marijuana Licensing Ordinance in the city’s weekly formal session.
Locally, the Detroit City Council in Nov 2020 unanimously voted yes for an ordinance that permits recreational marijuana sales made by adults. Social equity components tied to the ordinance will also yield favorable results for Detroit residents interested in entering this high-profit industry.
With the passage of the 2018 Farm Bill, hemp became federally legal, making all hemp-derived products (like CBD oil) legal in the country. States also can designate their laws, and in late 2018, Then, Michigan became the first Midwestern state to legalize recreational marijuana. In Michigan, only adults over 21 may use cannabis legally.
Detroit City Councilman James Tate told the Michigan Chronicle a week before the vote that it’d been a long but productive two years since the initial ordinance was passed.
The Detroit Metro Times reported that the Council members were required to have another hearing (they held on Tuesday) to let recreational marijuana businesses open after voting yes on increasing the number of dispensary licenses from 76 to 100 – and after changing their initial ordinance after a court injunction.
Tate said that the licensing ordinance has two elements: non-equity and equity/legacy Detroiters, which caught the eye of courts.
“We created two tracts because we did not want them (equity/legacy Detroiters) competing against more well-funded and well-resourced individuals,” Tate said. “We have a provision where we worked on the social equity portion of the ordinance that focused on ensuring that Detroiters have not just an opportunity into the industry but really identifying ways to make sure that they are a success for those legacy Detroiters.”
To be considered a “Legacy Detroiter,” applicants must have lived in the city for 15 of the last 30 years, including the past year; have lived in the city for 13 of the previous 30 years, including the previous year, and qualify as low-income or have lived in the city for 10 of the last 30 years including the past year and have a marijuana conviction. The ordinance will be featured as an amendment to the Detroit City Code.
“The whole ordinance was approved Nov. 2020 and got caught up in court with a lawsuit filed against Detroit,” Tate said, adding that a judge said the city’s ordinance could be considered “unconstitutional” because of an unbalanced playing field for legacy Detroit residents looking to make their mark in the cannabis space.
Tate added that the injunction led the city to a place where they could fight the ordinance or tweak it and create a new ordinance.
“(We) took the latter approach,” Tate said, adding in a previously published quote that he’s seen around the country where people who live in a city benefiting from a marijuana industry are “frozen out” and are unable to participate for various reasons, including financial ones.
According to the city, passing this ordinance grants licensing for these state-approved categories:
- Adult-use retailer establishment
- Grower
- Processor
- Safety compliance facility
- Temporary marijuana event
- Microbusiness
- Designated consumption lounge
- Secure transporter
Tate added that while the city could not “wave a magic wand” to remove financial burdens for entrepreneurs looking to enter the industry, tremendous strides have been made, including mirroring the state of Michigan by reducing application fees.
“Based upon you living in [a] disproportionately impacted community like Detroit, you can receive up to a 75 percent discount for your licensing application here,” Tate said. He listened to colleagues and others in the industry to make this local industry more equitable. “I think the most important [thing is] making sure we have space provided for those previously incarcerated for marijuana-related convictions … lastly [we] included elements for community engagement that also helped strengthen this ordinance … [so the] community [has more understanding] on what is coming to their neighborhoods.”
Former Detroit Lion Rob Sims, the co-founder of the Michigan-based cannabis company Primitive Group, said previously that he supports the ordinance and feels Detroit is trying to “do the right thing” from the social equity perspective.
“I am for this ordinance for a lot of different reasons,” he said. “I’m looking forward to touching more people in the city of Detroit with our medicine.”
The ordinance also states that at least $1 million generated yearly from licensing sales can go toward various adult-use social equity initiatives. The release added and a portion of adult-use sales taxes will also fund substance use prevention programming for youth, according to the city’s marijuana ordinance.
According to the city website, Councilman James Tate led the charge on this legislation that champions a social equity program (SEP) that guarantees that no less than 50% of all license types will be awarded to Detroit Legacy applicants.
Tate told the Chronicle previously that with at least 80 percent of the city being African American, he recognizes that the industry has not been “welcoming” to people of color. Statistics don’t lie either locally– Detroiters in Detroit own only four percent of the 45 marijuana-based retail establishments, and even amending ordinances won’t please everyone.
“There is no perfect ordinance that would satisfy everyone,” Tate said. “In the city of Detroit as we have gone through this process we realize … as you please one group … it triggers concerns in another group.”
Tate added that “sound policy” is the way to go while building up an equitable, diverse industry in the city, especially for Detroiters looking for a way into the industry.
“Detroit will become, I believe, a major player in terms of adult-use cannabis,” he said. “It’s clear there is a desire here from folks.”
Tate said in a press release after the ordinance that he is “thankful” that Detroit will join the 23 Michigan municipalities that have allowed adult-use cannabis licensing in its borders.
“But the goal has never been to simply have licensing within the city, but to create policy that works to address the inequities that so many Detroiters have experienced trying to pursue an opportunity in this industry,” Tate said.
Applications for adult-use licensing for licenses could begin as early as Wednesday, April 20, the effective date of the ordinance.
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