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Text Of House Bill (Passed By Senate) 4209


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HB-4209, As Passed Senate, September 8, 2016
 
SENATE SUBSTITUTE FOR
 
HOUSE BILL NO. 4209
 
 
 
A bill to license and regulate medical marihuana growers, processors, provisioning centers, secure transporters, and safety compliance facilities; to provide for the powers and duties of certain state and local governmental officers and entities; to create a medical marihuana licensing board; to provide for interaction with the statewide monitoring system for commercial marihuana transactions; to create an advisory panel; to provide immunity from prosecution for marihuana-related offenses for persons engaging in marihuana-related activities in compliance with this act; to prescribe civil fines and sanctions and provide remedies; to provide for forfeiture of contraband; to provide for taxes, fees, and assessments; and to require the promulgation of rules.
 
 
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
 
PART 1. GENERAL PROVISIONS
 
Sec. 101. This act shall be known and may be cited as the "medical marihuana facilities licensing act".
 
Sec. 102. As used in this act:
 
(a) "Advisory panel" or "panel" means the marihuana advisory panel created in section 801.
 
(b) "Affiliate" means any person that controls, is controlled by, or is under common control with; is in a partnership or joint venture relationship with; or is a co-shareholder of a corporation, a co-member of a limited liability company, or a co-partner in a limited liability partnership with a licensee or applicant.
 
© "Applicant" means a person who applies for a state operating license. With respect to disclosures in an application, or for purposes of ineligibility for a license under section 402, the term applicant includes an officer, director, and managerial employee of the applicant and a person who holds any direct or indirect ownership interest in the applicant.
 
(d) "Board" means the medical marihuana licensing board created in section 301.
 
(e) "Department" means the department of licensing and regulatory affairs.
 
(f) "Grower" means a licensee that is a commercial entity located in this state that cultivates, dries, trims, or cures and packages marihuana for sale to a processor or provisioning center. 
 
(g) "Licensee" means a person holding a state operating license.
 
(h) "Marihuana" means that term as defined in section 7106 of the public health code, 1978 PA 368, MCL 333.7106.
 
(i) "Marihuana facility" means a location at which a license holder is licensed to operate under this act.
 
(j) "Marihuana plant" means any plant of the species Cannabis sativa L.
 
(k) "Marihuana-infused product" means a topical formulation, tincture, beverage, edible substance, or similar product containing any usable marihuana that is intended for human consumption in a manner other than smoke inhalation. Marihuana-infused product shall not be considered a food for purposes of the food law, 2000 PA 92, MCL 289.1101 to 289.8111.
 
(l) "Michigan medical marihuana act" means the Michigan medical marihuana act, 2008 IL 1, MCL 333.26421 to 333.26430.
 
(m) "Municipality" means a city, township, or village.
 
(n) "Paraphernalia" means any equipment, product, or material of any kind that is designed for or used in growing, cultivating, producing, manufacturing, compounding, converting, storing, processing, preparing, transporting, injecting, smoking, ingesting, inhaling, or otherwise introducing into the human body, marihuana.
 
(o) "Person" means an individual, corporation, limited liability company, partnership, limited partnership, limited liability partnership, limited liability limited partnership, trust, or other legal entity.
 
(p) "Plant" means any living organism that produces its own food through photosynthesis and has observable root formation or is in growth material.
 
(q) "Processor" means a licensee that is a commercial entity located in this state that purchases marihuana from a grower and that extracts resin from the marihuana or creates a marihuana- infused product for sale and transfer in packaged form to a provisioning center.
 
® "Provisioning center" means a licensee that is a commercial entity located in this state that purchases marihuana from a grower or processor and sells, supplies, or provides marihuana to registered qualifying patients, directly or through the patients' registered primary caregivers. Provisioning center includes any commercial property where marihuana is sold at retail to registered qualifying patients or registered primary caregivers. A noncommercial location used by a primary caregiver to assist a qualifying patient connected to the caregiver through the department's marihuana registration process in accordance with the Michigan medical marihuana act is not a provisioning center for purposes of this act.
 
(s) "Registered primary caregiver" means a primary caregiver who has been issued a current registry identification card under the Michigan medical marihuana act.
 
(t) "Registered qualifying patient" means a qualifying patient who has been issued a current registry identification card under the Michigan medical marihuana act or a visiting qualifying patient as that term is defined in section 3 of the Michigan medical marihuana act, MCL 333.26423.
 
(u) "Registry identification card" means that term as defined in section 3 of the Michigan medical marihuana act, MCL 333.26423.
 
(v) "Rules" means rules promulgated under the administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328, by the department in consultation with the board to implement this act.
 
(w) "Safety compliance facility" means a licensee that is a commercial entity that receives marihuana from a marihuana facility or registered primary caregiver, tests it for contaminants and for tetrahydrocannabinol and other cannabinoids, returns the test results, and may return the marihuana to the marihuana facility.
 
(x) "Secure transporter" means a licensee that is a commercial entity located in this state that stores marihuana and transports marihuana between marihuana facilities for a fee.
 
(y) "State operating license" or, unless the context requires a different meaning, "license" means a license that is issued under this act that allows the licensee to operate as 1 of the following, specified in the license:
 
(i) A grower.
 
(ii) A processor.
 
(iii) A secure transporter.
 
(iv) A provisioning center.
 
(v) A safety compliance facility.
 
(z) "Statewide monitoring system" or, unless the context requires a different meaning, "system" means an Internet-based, statewide database established, implemented, and maintained by the department under the marihuana tracking act, that is available to licensees, law enforcement agencies, and authorized state departments and agencies on a 24-hour basis for all of the following:
 
(i) Verifying registry identification cards.
 
(ii) Tracking marihuana transfer and transportation by licensees, including transferee, date, quantity, and price.
 
(iii) Verifying in commercially reasonable time that a transfer will not exceed the limit that the patient or caregiver is authorized to receive under section 4 of the Michigan medical marihuana act, MCL 333.26424.
 
 
(aa) "Usable marihuana" means the dried leaves, flowers, plant resin, or extract of the marihuana plant, but does not include the seeds, stalks, and roots of the plant.
 
 
PART 2. APPLICATION OF OTHER LAWS
 
Sec. 201. (1) Except as otherwise provided in this act, if a person has been granted a state operating license and is operating within the scope of the license, the licensee and its agents are not subject to any of the following for engaging in activities described in subsection (2):
 
(a) Criminal penalties under state law or local ordinances regulating marihuana.
 
(b) State or local criminal prosecution for a marihuana-related offense.
 
© State or local civil prosecution for a marihuana-related offense.
 
(d) Search or inspection, except for an inspection authorized under this act by law enforcement officers, the municipality, or the department.
 
(e) Seizure of marihuana, real property, personal property, or anything of value based on a marihuana-related offense.
 
 
(f) Any sanction, including disciplinary action or denial of a right or privilege, by a business or occupational or professional licensing board or bureau based on a marihuana-related offense.
 
(2) The following activities are protected under subsection (1) if performed under a state operating license within the scope of that license and in accord with this act, rules, and any ordinance adopted under section 205:
 
(a) Growing marihuana.
 
(b) Purchasing, receiving, selling, transporting, or transferring marihuana from or to a licensee, a licensee's agent, a registered qualifying patient, or a registered primary caregiver.
 
© Possessing marihuana.
 
(d) Possessing or manufacturing marihuana paraphernalia for medical use.
 
(e) Processing marihuana.
 
(f) Transporting marihuana.
 
(g) Testing, transferring, infusing, extracting, altering, or studying marihuana.
 
(h) Receiving or providing compensation for products or services.
 
(3) Except as otherwise provided in this act, a person who owns or leases real property upon which a marihuana facility is located and who has no knowledge that the licensee violated this act is not subject to any of the following for owning, leasing, or permitting the operation of a marihuana facility on the real property:
 
(a) Criminal penalties under state law or local ordinances regulating marihuana.
 
(b) State or local civil prosecution based on a marihuana- related offense.
 
© State or local criminal prosecution based on a marihuana-related offense.
 
(d) Search or inspection, except for an inspection authorized under this act by law enforcement officers, the municipality, or the department.
 
(e) Seizure of any real or personal property or anything of value based on a marihuana-related offense.
 
(f) Any sanction, including disciplinary action or denial of a right or privilege, by a business or occupational or professional licensing board or bureau.
 
 
(4) For the purposes of regulating the commercial entities established under this act, any provisions of the following acts that are inconsistent with this act do not apply to a grower, processor, secure transporter, provisioning center, or safety compliance facility operating in compliance with this act:
 
(a) The business corporation act, 1972 PA 284, MCL 450.1101 to 450.2098.
 
(b) The nonprofit corporation act, 1982 PA 162, MCL 450.2101 to 450.3192.
 
© 1931 PA 327, MCL 450.98 to 450.192.
 
(d) The Michigan revised uniform limited partnership act, 1982 PA 213, MCL 449.1101 to 449.2108.
 
(e) The Michigan limited liability company act, 1993 PA 23, MCL 450.4101 to 450.5200.
 
(f) 1907 PA 101, MCL 445.1 to 445.5.
 
(g) 1913 PA 164, MCL 449.101 to 449.106.
 
(h) The uniform partnership act, 1917 PA 72, MCL 449.1 to 449.48.
 
Sec. 203. A registered qualifying patient or registered primary caregiver is not subject to criminal prosecution or sanctions for purchasing marihuana from a provisioning center if the quantity purchased is within the limits established under the Michigan medical marihuana act. A registered primary caregiver is not subject to criminal prosecution or sanctions for any transfer of 2.5 ounces or less of marihuana to a safety compliance facility for testing.
 
Sec. 204. This act does not limit the medical purpose defense provided in section 8 of the Michigan medical marihuana act, 2008 IL 1, MCL 333.26428, to any prosecution involving marihuana.
 
 
Sec. 205. (1) A marihuana facility shall not operate in a municipality unless the municipality has adopted an ordinance that authorizes that type of facility. A municipality may adopt an ordinance to authorize 1 or more types of marihuana facilities within its boundaries and to limit the number of each type of marihuana facility. A municipality may adopt other ordinances relating to marihuana facilities within its jurisdiction, including zoning regulations, but shall not impose regulations regarding the purity or pricing of marihuana or interfering or conflicting with statutory regulations for licensing marihuana facilities. A municipality shall provide the following information to the board within 90 days after the municipality receives notification from the applicant that he or she has applied for a license under this act:
 
(a) A copy of the local ordinance that authorizes the marihuana facility.
 
(b) A copy of any zoning regulations that apply to the proposed marihuana facility within the municipality.
 
© A description of any violation of the local ordinance or zoning regulations included under subdivision (a) or (b) committed by the applicant, but only if those violations relate to activities licensed under this act or the Michigan medical marihuana act.
 
     (2) The board may consider the information provided under
 
subsection (1) in the application process. However, the
 
municipality's failure to provide information to the board shall
 
not be used against the applicant.
 
     (3) A municipal ordinance may establish an annual,
 
nonrefundable fee of not more than $5,000.00 on a licensee to help
 
defray administrative and enforcement costs associated with the
 
operation of a marihuana facility in the municipality.
 
     (4) Information a municipality obtains from an applicant
 
related to licensure under this section is exempt from disclosure
 
under the freedom of information act, 1976 PA 442, MCL 15.231 to
 
15.246.
 
Sec. 206. The department, in consultation with the board, shall promulgate rules and emergency rules as necessary to implement, administer, and enforce this act. The rules shall ensure the safety, security, and integrity of the operation of marihuana facilities, and shall include rules to do the following:
 
 
(a) Set appropriate standards for marihuana facilities and associated equipment.
 
(b) Subject to section 408, establish minimum levels of insurance that licensees must maintain.
 
     © Establish operating regulations for each category of
 
license to ensure the health, safety, and security of the public
 
and the integrity of marihuana facility operations.
 
     (d) Establish qualifications and restrictions for persons
 
participating in or involved with operating marihuana facilities.
 
     (e) Establish testing standards, procedures, and requirements
 
for marihuana sold through provisioning centers.
 
     (f) Provide for the levy and collection of fines for a
 
violation of this act or rules.
 
     (g) Prescribe use of the statewide monitoring system to track
 
all marihuana transfers, as provided in the marihuana tracking act
 
and this act and provide for a funding mechanism to support the
 
system.
 
     (h) Establish quality control standards, procedures, and
 
requirements for marihuana facilities.
 
     (i) Establish chain of custody standards, procedures, and
 
requirements for marihuana facilities.
 
     (j) Establish standards, procedures, and requirements for
 
waste product disposal and storage by marihuana facilities.
 
     (k) Establish chemical storage standards, procedures, and
 
requirements for marihuana facilities.
 
     (l) Establish standards, procedures, and requirements for
 
securely and safely transporting marihuana between marihuana
 
facilities.
 
     (m) Establish standards, procedures, and requirements for the
 
storage of marihuana by marihuana facilities.
 
     (n) Establish labeling and packaging standards, procedures,
 
and requirements for marihuana sold or transferred through
 
provisioning centers, including a prohibition on labeling or
 
packaging that is intended to appeal to or has the effect of
 
appealing to minors.
 
     (o) Establish daily purchasing limits at provisioning centers
 
for registered qualifying patients and registered primary
 
caregivers to ensure compliance with the Michigan medical marihuana
 
act.
 
     (p) Establish marketing and advertising restrictions for
 
marihuana products and marihuana facilities.
 
     (q) Establish maximum tetrahydrocannabinol levels for
 
marihuana-infused products sold or transferred through provisioning
 
centers.
 
     ® Establish health standards to ensure the safe preparation
 
of products containing marihuana that are intended for human
 
consumption in a manner other than smoke inhalation.
 
     (s) Establish restrictions on edible marihuana-infused
 
products to prohibit shapes that would appeal to minors.
 
Sec. 207. A licensee shall adopt and use a third-party inventory control and tracking system that is capable of interfacing with the statewide monitoring system to allow the licensee to enter or access information in the statewide monitoring system as required under this act and rules. The third-party inventory control and tracking system must have all of the following capabilities necessary for the licensee to comply with the requirements applicable to the licensee's license type:
 
     (a) Tracking all marihuana plants, products, packages, patient
 
and primary caregiver purchase totals, waste, transfers,
 
conversions, sales, and returns that are linked to unique
 
identification numbers.
 
     (b) Tracking lot and batch information throughout the entire
 
chain of custody.
 
     © Tracking all products, conversions, and derivatives
 
throughout the entire chain of custody.
 
     (d) Tracking marihuana plant, batch, and product destruction.
 
     (e) Tracking transportation of product.
 
     (f) Performing complete batch recall tracking that clearly
 
identifies all of the following details relating to the specific
 
batch subject to the recall:
 
     (i) Sold product.
 
     (ii) Product inventory that is finished and available for
 
sale.
 
     (iii) Product that is in the process of transfer.
 
     (iv) Product being processed into another form.
 
     (v) Postharvest raw product, such as product that is in the
 
drying, trimming, or curing process.
 
     (g) Reporting and tracking loss, theft, or diversion of
 
product containing marihuana.
 
     (h) Reporting and tracking all inventory discrepancies.
 
     (i) Reporting and tracking adverse patient responses or dose-
 
related efficacy issues.
 
     (j) Reporting and tracking all sales and refunds.
 
     (k) Electronically receiving and transmitting information as
 
required under this act, the Michigan medical marihuana act, 2008
 
IL 1, MCL 333.26421 to 333.26430, and the marihuana tracking act.
 
     (l) Receiving testing results electronically from a safety
 
compliance facility via a secured application program interface
 
into the system and directly linking the testing results to each
 
applicable source batch and sample.
 
     (m) Identifying test results that may have been altered.
 
     (n) Providing the licensee with access to information in the
 
tracking system that is necessary to verify that the licensee is
 
carrying out the marihuana transactions authorized under the
 
licensee's license in accordance with this act.
 
     (o) Providing information to cross-check that product sales
 
are made to a registered qualifying patient or a registered primary
 
caregiver on behalf of a registered qualifying patient and that the
 
product received the required testing.
 
     (p) Providing the department and state agencies with access to
 
information in the database that they are authorized to access.
 
     (q) Providing law enforcement agencies with access to only the
 
information in the database that is necessary to verify that an
 
individual possesses a valid and current registry identification
 
card.
 
     ® Providing licensees with access only to the information in
 
the system that they are required to receive before a sale,
 
transfer, transport, or other activity authorized under a license
 
issued under this act.
 
     (s) Securing the confidentiality of information in the
 
database by preventing access by a person who is not authorized to
 
access the statewide monitoring system or is not authorized to
 
access the particular information.
 
     (t) Providing analytics to the department regarding key
 
performance indicators such as the following:
 
     (i) Total daily sales.
 
     (ii) Total marihuana plants in production.
 
     (iii) Total marihuana plants destroyed.
 
     (iv) Total inventory adjustments.
 
     Sec. 208. A marihuana facility and all articles of property in
 
that facility are subject to examination at any time by a local
 
police agency or the department of state police.
 
PART 3. MEDICAL MARIHUANA LICENSING BOARD
 
     Sec. 301. (1) The medical marihuana licensing board is created
 
within the department of licensing and regulatory affairs.
 
     (2) The board consists of 5 members who are residents of this
 
state, not more than 3 of whom are members of the same political
 
party. The governor shall appoint the members. One of the members
 
shall be appointed from 3 nominees submitted by the senate majority
 
leader and 1 from 3 nominees submitted by the speaker of the house.
 
The governor shall designate 1 of the members as chairperson.
 
     (3) The members shall be appointed for terms of 4 years,
 
except, of those who are first appointed, 1 member shall be
 
appointed for a term of 2 years and 2 members shall be appointed
 
for a term of 3 years. A member's term expires on December 31 of
 
the last year of the member's term. If a vacancy occurs, the
 
governor shall appoint a successor to fill the unexpired term in
 
the manner of the original appointment.
 
     (4) Each member of the board shall be reimbursed for all
 
actual and necessary expenses and disbursements incurred in
 
carrying out official duties.
 
     (5) A board member shall not hold any other public office for
 
which he or she receives compensation other than necessary travel
 
or other incidental expenses.
 
     (6) A person who is not of good moral character or who has
 
been indicted for, charged with, or convicted of, pled guilty or
 
nolo contendere to, or forfeited bail concerning any felony or a
 
misdemeanor involving a controlled substance violation, theft,
 
dishonesty, or fraud under the laws of this state, any other state,
 
or the United States or a local ordinance in any state involving a
 
controlled substance violation, dishonesty, theft, or fraud that
 
substantially corresponds to a misdemeanor in that state is not
 
eligible to serve on the board.
 
     (7) The governor may remove any member of the board for
 
neglect of duty, misfeasance, malfeasance, nonfeasance, or any
 
other just cause.
 
     (8) The department in conjunction with the board shall employ
 
an executive director and other personnel as necessary to assist
 
the board in carrying out its duties. The executive director shall
 
devote his or her full time to the duties of the office and shall
 
not hold any other office or employment.
 
     (9) The board shall not appoint or employ an individual if any
 
of the following circumstances exist:
 
     (a) During the 3 years immediately preceding appointment or
 
employment, the individual held any direct or indirect interest in,
 
or was employed by, a person who is licensed to operate under this
 
act or under a corresponding license in another jurisdiction or a
 
person with an application for an operating license pending before
 
the board or in any other jurisdiction. The board shall not employ
 
an individual who has a direct or indirect interest in a licensee
 
or a marihuana facility.
 
     (b) The individual or his or her spouse, parent, child,
 
child's spouse, sibling, or spouse of a sibling has an application
 
for a license pending before the board or is a member of the board
 
of directors of, or an individual financially interested in, any
 
licensee or marihuana facility.
 
     (10) Each member of the board, the executive director, and
 
each key employee as determined by the department shall file with
 
the governor a financial disclosure statement listing all assets
 
and liabilities, property and business interests, and sources of
 
income of the member, executive director, and key employee and his
 
or her spouse, if any, affirming that the member, executive
 
director, and key employee are in compliance with subsection (9)(a)
 
and (b). The financial disclosure statement shall be made under
 
oath and filed at the time of employment and annually thereafter.
 
     (11) Each employee of the board shall file with the board a
 
financial disclosure statement listing all assets and liabilities,
 
property and business interests, and sources of income of the
 
employee and his or her spouse. This subsection does not apply to
 
the executive director or a key employee.
 
     (12) A member of the board, executive director, or key
 
employee shall not hold any direct or indirect interest in, be
 
employed by, or enter into a contract for services with an
 
applicant, a board licensee, or a marihuana facility for a period
 
of 4 years after the date his or her employment or membership on
 
the board terminates. The department in consultation with the board
 
shall define the term "direct or indirect interest" by rule.
 
     (13) For 2 years after the date his or her employment with the
 
board is terminated, an employee of the board shall not acquire any
 
direct or indirect interest in, be employed by, or enter into a
 
contract for services with any applicant, licensee, or marihuana
 
facility.
 
     (14) For 2 years after the termination of his or her office or
 
employment with the board, a board member or an individual employed
 
by the board shall not represent any person or party other than
 
this state before or against the board.
 
     (15) A business entity in which a former board member or
 
employee or agent has an interest, or any partner, officer, or
 
employee of the business entity, shall not make any appearance or
 
represent a party that the former member, employee, or agent is
 
prohibited from appearing for or representing. As used in this
 
subsection, "business entity" means a corporation, limited
 
liability company, partnership, limited liability partnership,
 
association, trust, or other form of legal entity.
 
Sec. 302. The board has general responsibility for implementing this act. The board has the powers and duties specified in this act and all other powers necessary and proper to fully and effectively implement and administer this act for the purpose of licensing, regulating, and enforcing the licensing and regulation system established under this act for marihuana growth, processing, testing, and transporting. The board is subject to the administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328. The board's duties include all of the following:
 
     (a) Granting or denying each application for a state operating
 
license within a reasonable time.
 
     (b) Deciding all license applications in reasonable order.
 
     © Conducting its public meetings in compliance with the open
 
meetings act, 1976 PA 267, MCL 15.231 to 15.246.
 
     (d) Consulting with the department in promulgating rules and
 
emergency rules as necessary to implement, administer, and enforce
 
this act. The board shall not promulgate a rule establishing a
 
limit on the number or type of marihuana facility licenses that may
 
be granted.
 
     (e) Implementing and collecting the application fee described
 
in section 401 and, in conjunction with the department of treasury,
 
the tax described in section 601 and regulatory assessment
 
described in section 603.
 
     (f) Providing for the levy and collection of fines for a
 
violation of this act or rules.
 
     (g) Providing oversight of a marihuana facility through the
 
board's inspectors, agents, and auditors and through the state
 
police or attorney general for the purpose of certifying the
 
revenue, receiving complaints from the public, or conducting
 
investigations into the operation of the marihuana facility as the
 
board considers necessary and proper to ensure compliance with this
 
act and rules and to protect and promote the overall safety,
 
security, and integrity of the operation of a marihuana facility.
 
     (h) Providing oversight of marihuana facilities to ensure that
 
marihuana-infused products meet health and safety standards that
 
protect the public to a degree comparable to state and federal
 
standards applicable to similar food and drugs.
 
     (i) Reviewing and ruling on any complaint by a licensee
 
regarding any investigative procedures of this state that are
 
believed to be unnecessarily disruptive of marihuana facility
 
operations. The need to inspect and investigate is presumed at all
 
times. The board may delegate authority to hear, review, or rule on
 
licensee complaints to a subcommittee of the board. To prevail on
 
the complaint, a licensee must establish by a preponderance of the
 
evidence that the procedures unreasonably disrupted its marihuana
 
facility operations.
 
     (j) Holding at least 2 public meetings each year. Upon 72
 
hours' written notice to each member, the chairperson or any 2
 
board members may call a special meeting. Three members of the
 
board constitute a quorum, including when making determinations on
 
an application for a license. Three votes are required in support
 
of final determinations of the board on applications for licenses
 
and all other licensing determinations, except that 4 votes are
 
required in support of a determination to suspend or revoke a
 
license. The board shall keep a complete and accurate record of all
 
of its meetings and hearings. Upon order of the board, 1 of the
 
board members or a hearing officer designated by the board may
 
conduct any hearing provided for under this act or by rules and may
 
recommend findings and decisions to the board. The board member or
 
hearing officer conducting the hearing has all powers and rights
 
regarding the conduct of hearings granted to the board under this
 
act. The record made at the time of the hearing shall be reviewed
 
by the board or a majority of the board, and the findings and
 
decision of the majority of the board are the order of the board in
 
the case.
 
     (k) Maintaining records that are separate and distinct from
 
the records of any other state board. The records shall be made
 
available for public inspection subject to the limitations of this
 
act and shall accurately reflect all board proceedings.
 
     (l) Reviewing the patterns of marihuana transfers by the
 
licensees under this act as recorded in a statewide database
 
established for use in administering and enforcing this act and
 
making recommendations to the governor and the legislature in a
 
written annual report to the governor and the legislature and
 
additional reports that the governor requests. The annual report
 
shall be submitted by April 15 of each year and shall include the
 
report required under section 702, a statement of receipts and
 
disbursements by the board, the actions taken by the board, and any
 
additional information and recommendations that the board considers
 
appropriate or that the governor requests.
 
     (m) Except as otherwise provided in this act, all information,
 
records, interviews, reports, statements, memoranda, or other data
 
supplied to or used by the board are subject to the freedom of
 
information act, 1976 PA 442, MCL 15.231 to 15.246, except for the
 
following:
 
     (i) Unless presented during a public hearing or requested by
 
the licensee or applicant who is the sole subject of the data, all
 
of the information, records, interviews, reports, statements,
 
memoranda, or other data supplied to, created by, or used by the
 
board related to background investigation of applicants or
 
licensees and to trade secrets, internal controls, and security
 
measures of the licensees or applicants.
 
     (ii) All information, records, interviews, reports,
 
statements, memoranda, or other data supplied to or used by the
 
board that have been received from another jurisdiction or local,
 
state, or federal agency under a promise of confidentiality or if
 
the release of the information is otherwise barred by the statutes,
 
rules, or regulations of that jurisdiction or agency or by an
 
intergovernmental agreement.
 
     (iii) All information in the statewide monitoring system.
 
     Sec. 303. (1) The board has jurisdiction over the operation of
 
all marihuana facilities. The board has all powers necessary and
 
proper to fully and effectively oversee the operation of marihuana
 
facilities, including the authority to do all of the following:
 
     (a) Investigate applicants for state operating licenses,
 
determine the eligibility for licenses, and grant licenses to
 
applicants in accordance with this act and the rules.
 
     (b) Investigate all individuals employed by marihuana
 
facilities.
 
     © At any time, through its investigators, agents, auditors,
 
or the state police, without a warrant and without notice to the
 
licensee, enter the premises, offices, facilities, or other places
 
of business of a licensee, if evidence of compliance or
 
noncompliance with this act or rules is likely to be found and
 
consistent with constitutional limitations, for the following
 
purposes:
 
     (i) To inspect and examine all premises of marihuana
 
facilities.
 
     (ii) To inspect, examine, and audit relevant records of the
 
licensee and, if the licensee fails to cooperate with an
 
investigation, impound, seize, assume physical control of, or
 
summarily remove from the premises all books, ledgers, documents,
 
writings, photocopies, correspondence, records, and videotapes,
 
including electronically stored records, money receptacles, or
 
equipment in which the records are stored.
 
     (iii) To inspect the person, and inspect or examine personal
 
effects present in a marihuana facility, of any holder of a state
 
operating license while that person is present in a marihuana
 
facility.
 
     (iv) To investigate alleged violations of this act or rules.
 
     (d) Investigate alleged violations of this act or rules and
 
take appropriate disciplinary action against a licensee.
 
     (e) Consult with the department in adopting rules to establish
 
appropriate standards for marihuana facilities and associated
 
equipment.
 
     (f) Require all relevant records of licensees, including
 
financial or other statements, to be kept on the premises
 
authorized for operation of the marihuana facility of the licensee
 
or in the manner prescribed by the board.
 
     (g) Require that each licensee of a marihuana facility submit
 
to the board a list of the stockholders or other persons having a
 
1% or greater beneficial interest in the facility in addition to
 
any other information the board considers necessary to effectively
 
administer this act and rules, orders, and final decisions made
 
under this act.
 
     (h) Eject, or exclude or authorize the ejection or exclusion
 
of, an individual from a marihuana facility if the individual
 
violates this act, rules, or final orders of the board. However,
 
the propriety of the ejection or exclusion is subject to a
 
subsequent hearing by the board.
 
     (i) Conduct periodic audits of marihuana facilities licensed
 
under this act.
 
     (j) Consult with the department as to appropriate minimum
 
levels of insurance for licensees in addition to the minimum
 
established under section 408 for liability insurance.
 
     (k) Delegate the execution of any of its powers that are not
 
specifically and exclusively reserved to the board under this act
 
for the purpose of administering and enforcing this act and rules.
 
     (l) Take disciplinary action as the board considers
 
appropriate to prevent practices that violate this act and rules.
 
     (m) Review a licensee if that licensee is under review or the
 
subject of discipline by a regulatory body in any other
 
jurisdiction for a violation of a controlled substance or marihuana
 
law or regulation in that jurisdiction.
 
     (n) Take any other reasonable or appropriate action to enforce
 
this act and rules.
 
     (2) The board may seek and shall receive the cooperation and
 
assistance of the department of state police in conducting
 
background investigations of applicants and in fulfilling its
 
responsibilities under this act. The department of state police may
 
recover its costs of cooperation under this subsection.
 
     Sec. 305. (1) By January 31 of each year, each member of the
 
board shall prepare and file with the governor's office and the
 
board a disclosure form in which the member does all of the
 
following:
 
     (a) Affirms that the member or the member's spouse, parent,
 
child, or child's spouse is not a member of the board of directors
 
of, financially interested in, or employed by a licensee or
 
applicant.
 
     (b) Affirms that the member continues to meet any other
 
criteria for board membership under this act or the rules
 
promulgated by the board.
 
     © Discloses any legal or beneficial interests in any real
 
property that is or that may be directly or indirectly involved
 
with operations authorized by this act.
 
     (d) Discloses any other information as may be required to
 
ensure that the integrity of the board and its work is maintained.
 
     (2) By January 31 of each year, each employee of the board
 
shall prepare and file with the board an employee disclosure form
 
in which the employee does all of the following:
 
     (a) Affirms the absence of financial interests prohibited by
 
this act.
 
     (b) Discloses any legal or beneficial interests in any real
 
property that is or that may be directly or indirectly involved
 
with operations authorized by this act.
 
     © Discloses whether the employee or the employee's spouse,
 
parent, child, or child's spouse is financially interested in or
 
employed by a licensee or an applicant for a license under this
 
act.
 
     (d) Discloses such other matters as may be required to ensure
 
that the integrity of the board and its work is maintained.
 
     (3) A member, employee, or agent of the board who becomes
 
aware that the member, employee, or agent of the board or his or
 
her spouse, parent, or child is a member of the board of directors
 
of, financially interested in, or employed by a licensee or an
 
applicant shall immediately provide detailed written notice thereof
 
to the chairperson.
 
     (4) A member, employee, or agent of the board who within the
 
previous 10 years has been indicted for, charged with, or convicted
 
of, pled guilty or nolo contendere to, or forfeited bail concerning
 
a misdemeanor involving controlled substances, dishonesty, theft,
 
or fraud or a local ordinance in any state involving controlled
 
substances, dishonesty, theft, or fraud that substantially
 
corresponds to a misdemeanor in that state, or a felony under
 
Michigan law, the laws of any other state, or the laws of the
 
United States or any other jurisdiction shall immediately provide
 
detailed written notice of the conviction or charge to the
 
chairperson.
 
     (5) Any member, employee, or agent of the board who is
 
negotiating for, or acquires by any means, any interest in any
 
person who is a licensee or an applicant, or any person affiliated
 
with such a person, shall immediately provide written notice of the
 
details of the interest to the chairperson. The member, employee,
 
or agent of the board shall not act on behalf of the board with
 
respect to that person.
 
     (6) A member, employee, or agent of the board shall not enter
 
into any negotiations for employment with any person or affiliate
 
of any person who is a licensee or an applicant and shall
 
immediately provide written notice of the details of any such
 
negotiations or discussions in progress to the chairperson. The
 
member, employee, or agent of the board shall not take action on
 
behalf of the board with respect to that person.
 
     (7) Any member, employee, or agent of the board who receives
 
an invitation, written or oral, to initiate a discussion concerning
 
employment or the possibility of employment with a person or
 
affiliate of a person who is a licensee or an applicant shall
 
immediately report that he or she received the invitation to the
 
chairperson. The member, employee, or agent of the board shall not
 
take action on behalf of the board with respect to the person.
 
     (8) A licensee or applicant shall not knowingly initiate a
 
negotiation for or discussion of employment with a member,
 
employee, or agent of the board. A licensee or applicant who
 
initiates a negotiation or discussion about employment shall
 
immediately provide written notice of the details of the
 
negotiation or discussion to the chairperson as soon as he or she
 
becomes aware that the negotiation or discussion has been initiated
 
with a member, employee, or agent of the board.
 
     (9) A member, employee, or agent of the board, or former
 
member, employee, or agent of the board, shall not disseminate or
 
otherwise disclose any material or information in the possession of
 
the board that the board considers confidential unless specifically
 
authorized to do so by the chairperson or the board.
 
     (10) A member, employee, or agent of the board or a parent,
 
spouse, sibling, spouse of a sibling, child, or spouse of a child
 
of a member, employee, or agent of the board shall not accept any
 
gift, gratuity, compensation, travel, lodging, or anything of
 
value, directly or indirectly, from any licensee or any applicant
 
or affiliate or representative of a licensee or applicant, unless
 
the acceptance conforms to a written policy or directive that is
 
issued by the chairperson or the board. Any member, employee, or
 
agent of the board who is offered or receives any gift, gratuity,
 
compensation, travel, lodging, or anything of value, directly or
 
indirectly, from any licensee or any applicant or affiliate or
 
representative of an applicant or licensee shall immediately
 
provide written notification of the details to the chairperson.
 
     (11) A licensee or applicant, or an affiliate or
 
representative of an applicant or licensee, shall not, directly or
 
indirectly, give or offer to give any gift, gratuity, compensation,
 
travel, lodging, or anything of value to any member, employee, or
 
agent of the board that the member, employee, or agent of the board
 
is prohibited from accepting under subsection (10).
 
     (12) A member, employee, or agent of the board shall not
 
engage in any conduct that constitutes a conflict of interest and
 
shall immediately advise the chairperson in writing of the details
 
of any incident or circumstances that would present the existence
 
of a conflict of interest with respect to performing board-related
 
work or duties.
 
     (13) A member, employee, or agent of the board who is
 
approached and offered a bribe as described in section 118 of the
 
Michigan penal code, 1931 PA 328, MCL 750.118, or this act shall
 
immediately provide written account of the details of the incident
 
to the chairperson and to a law enforcement officer of a law
 
enforcement agency having jurisdiction.
 
     (14) A member, employee, or agent of the board shall disclose
 
his or her past involvement with any marihuana enterprise in the
 
past 5 years and shall not engage in political activity or
 
politically related activity during the duration of his or her
 
appointment or employment.
 
     (15) A former member, employee, or agent of the board may
 
appear before the board as a fact witness about matters or actions
 
handled by the member, employee, or agent during his or her tenure
 
as a member, employee, or agent of the board. The member, employee,
 
or agent of the board shall not receive compensation for such an
 
appearance other than a standard witness fee and reimbursement for
 
travel expenses as established by statute or court rule.
 
     (16) A licensee or applicant or any affiliate or
 
representative of an applicant or licensee shall not engage in ex
 
parte communications with a member of the board. A member of the
 
board shall not engage in any ex parte communications with a
 
licensee or an applicant or with any affiliate or representative of
 
an applicant or licensee.
 
     (17) Any board member, licensee, or applicant or affiliate or
 
representative of a board member, licensee, or applicant who
 
receives any ex parte communication in violation of subsection
 
(16), or who is aware of an attempted communication in violation of
 
subsection (16), shall immediately report details of the
 
communication or attempted communication in writing to the
 
chairperson.
 
     (18) Any member of the board who receives an ex parte
 
communication in an attempt to influence that member's official
 
action shall disclose the source and content of the communication
 
to the chairperson. The chairperson may investigate or initiate an
 
investigation of the matter with the assistance of the attorney
 
general and state police to determine if the communication violates
 
subsection (16) or subsection (17) or other state law. The
 
disclosure under this section and the investigation are
 
confidential. Following an investigation, the chairperson shall
 
advise the governor or the board, or both, of the results of the
 
investigation and may recommend action as the chairperson considers
 
appropriate. If the chairperson receives such an ex parte
 
communication, he or she shall report the communication to the
 
governor's office for appropriate action.
 
     (19) A new or current employee or agent of the board shall
 
obtain written permission from the executive director before
 
continuing outside employment held at the time the employee begins
 
to work for the board. Permission shall be denied, or permission
 
previously granted shall be revoked, if the executive director
 
considers the nature of the work to create a possible conflict of
 
interest or if it would otherwise interfere with the duties of the
 
employee or agent for the board.
 
     (20) An employee or agent of the board granted permission for
 
outside employment shall not conduct any business or perform any
 
activities, including solicitation, related to outside employment
 
on premises used by the board or during the employee's working
 
hours for the board.
 
     (21) The chairperson shall report any action he or she has
 
taken or proposes to take under this section with respect to an
 
employee or agent or former employee or former agent to the board
 
at the next meeting of the board. The board may direct the
 
executive director to take additional or different action.
 
     (22) Except as allowed under the Michigan medical marihuana
 
act, a member, employee, or agent of the board shall not enter into
 
any personal transaction involving marihuana with a licensee or
 
applicant.
 
     (23) If a licensee or applicant, or an affiliate or
 
representative of a licensee or applicant, violates this section,
 
the board may deny a license application, revoke or suspend a
 
license, or take other disciplinary action as provided in section
 
407.
 
     (24) Violation of this section by a member of the board may
 
result in disqualification or constitute cause for removal under
 
section 301(7) or other disciplinary action as recommended by the
 
board to the governor.
 
     (25) A violation of this section by an employee or agent of
 
the board need not result in termination of employment if the board
 
determines that the conduct involved does not violate the purpose
 
of this act. However, all of the following apply:
 
     (a) If, after being offered employment or beginning employment
 
with the board, the employee or agent intentionally acquires a
 
financial interest in a licensee or an applicant, or an affiliate
 
or representative of a licensee or applicant, the offer or
 
employment with the board shall be terminated.
 
     (b) If a financial interest in a licensee or an applicant, or
 
an affiliate or representative of a licensee or applicant, is
 
acquired by an employee or agent that has been offered employment
 
with the board, an employee of the board, or the employee's or
 
agent's spouse, parent, or child, through no intentional action of
 
the employee or agent, the individual shall have up to 30 days to
 
divest or terminate the financial interest. Employment may be
 
terminated if the interest has not been divested after 30 days.
 
     © Employment shall be terminated if the employee or agent is
 
a spouse, parent, child, or spouse of a child of a board member.
 
     (26) Violation of this section does not create a civil cause
 
of action.
 
     (27) As used in this section:
 
     (a) "Outside employment", in addition to employment by a third
 
party, includes, but is not limited to, the following:
 
     (i) Operation of a proprietorship.
 
     (ii) Participation in a partnership or group business
 
enterprise.
 
     (iii) Performance as a director or corporate officer of any
 
for-profit or nonprofit corporation or banking or credit
 
institution.
 
     (iv) Performance as a manager of a limited liability company.
 
     (b) "Political activity" or "politically related activity"
 
includes all of the following:
 
     (i) Using his or her official authority or influence for the
 
purpose of interfering with or affecting the result of an election.
 
     (ii) Knowingly soliciting, accepting, or receiving a political
 
contribution from any person.
 
     (iii) Running for the nomination or as a candidate for
 
election to a partisan political office.
 
     (iv) Knowingly soliciting or discouraging the participation in
 
any political activity of any person who is either of the
 
following:
 
     (A) Applying for any compensation, grant, contract, ruling,
 
license, permit, or certificate pending before the board.
 
     (B) The subject of or a participant in an ongoing audit,
 
investigation, or enforcement action being carried out by the
 
board.
 
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Part 2

 

 
PART 4. LICENSING
 
     Sec. 401. (1) Beginning 360 days after the effective date of
 
this act, a person may apply to the board for state operating
 
licenses in the categories of class A, B, or C grower; processor;
 
provisioning center; secure transporter; and safety compliance
 
facility as provided in this act. The application shall be made
 
under oath on a form provided by the board and shall contain
 
information as prescribed by the board, including, but not limited
 
to, all of the following:
 
     (a) The name, business address, business telephone number,
 
social security number, and, if applicable, federal tax
 
identification number of the applicant.
 
     (b) The identity of every person having any ownership interest
 
in the applicant with respect to which the license is sought. If
 
the disclosed entity is a trust, the application shall disclose the
 
names and addresses of the beneficiaries; if a corporation, the
 
names and addresses of all shareholders, officers, and directors;
 
if a partnership or limited liability partnership, the names and
 
addresses of all partners; if a limited partnership or limited
 
liability limited partnership, the names of all partners, both
 
general and limited; or if a limited liability company, the names
 
and addresses of all members and managers.
 
     © An identification of any business that is directly or
 
indirectly involved in the growing, processing, testing,
 
transporting, or sale of marihuana, including, if applicable, the
 
state of incorporation or registration, in which an applicant or,
 
if the applicant is an individual, the applicant's spouse, parent,
 
or child has any equity interest. If an applicant is a corporation,
 
partnership, or other business entity, the applicant shall identify
 
any other corporation, partnership, or other business entity that
 
is directly or indirectly involved in the growing, processing,
 
testing, transporting, or sale of marihuana in which it has any
 
equity interest, including, if applicable, the state of
 
incorporation or registration. An applicant may comply with this
 
subdivision by filing a copy of the applicant's registration with
 
the Securities and Exchange Commission if the registration contains
 
the information required by this subdivision.
 
     (d) Whether an applicant has been indicted for, charged with,
 
arrested for, or convicted of, pled guilty or nolo contendere to,
 
forfeited bail concerning any criminal offense under the laws of
 
any jurisdiction, either felony or controlled-substance-related
 
misdemeanor, not including traffic violations, regardless of
 
whether the offense has been reversed on appeal or otherwise,
 
including the date, the name and location of the court, arresting
 
agency, and prosecuting agency, the case caption, the docket
 
number, the offense, the disposition, and the location and length
 
of incarceration.
 
     (e) Whether an applicant has ever applied for or has been
 
granted any commercial license or certificate issued by a licensing
 
authority in Michigan or any other jurisdiction that has been
 
denied, restricted, suspended, revoked, or not renewed and a
 
statement describing the facts and circumstances concerning the
 
application, denial, restriction, suspension, revocation, or
 
nonrenewal, including the licensing authority, the date each action
 
was taken, and the reason for each action.
 
     (f) Whether an applicant has filed, or been served with, a
 
complaint or other notice filed with any public body, regarding the
 
delinquency in the payment of, or a dispute over the filings
 
concerning the payment of, any tax required under federal, state,
 
or local law, including the amount, type of tax, taxing agency, and
 
time periods involved.
 
     (g) A statement listing the names and titles of all public
 
officials or officers of any unit of government, and the spouses,
 
parents, and children of those public officials or officers, who,
 
directly or indirectly, own any financial interest in, have any
 
beneficial interest in, are the creditors of or hold any debt
 
instrument issued by, or hold or have any interest in any
 
contractual or service relationship with an applicant. As used in
 
this subdivision, public official or officer does not include a
 
person who would have to be listed solely because of his or her
 
state or federal military service.
 
     (h) A description of the type of marihuana facility;
 
anticipated or actual number of employees; and projected or actual
 
gross receipts.
 
     (i) Financial information in the manner and form prescribed by
 
the board.
 
     (j) A paper copy or electronic posting website reference for
 
the ordinance or zoning restriction that the municipality adopted
 
to authorize or restrict operation of 1 or more marihuana
 
facilities in the municipality.
 
     (k) A copy of the notice informing the municipality by
 
registered mail that the applicant has applied for a license under
 
this act. The applicant shall also certify that it has delivered
 
the notice to the municipality or will do so by 10 days after the
 
date the applicant submits the application for a license to the
 
board.
 
     (l) Any other information the department requires by rule.
 
     (2) The board shall use information provided on the
 
application as a basis to conduct a thorough background
 
investigation on the applicant. A false application is cause for
 
the board to deny a license. The board shall not consider an
 
incomplete application but shall, within a reasonable time, return
 
the application to the applicant with notification of the
 
deficiency and instructions for submitting a corrected application.
 
Information the board obtains from the background investigation is
 
exempt from disclosure under the freedom of information act, 1976
 
PA 442, MCL 15.231 to 15.246.
 
     (3) An applicant must provide written consent to the
 
inspections, examinations, searches, and seizures provided for in
 
section 303(1)©(i) to (iv) and to disclosure to the board and its
 
agents of otherwise confidential records, including tax records
 
held by any federal, state, or local agency, or credit bureau or
 
financial institution, while applying for or holding a license.
 
Information the board receives under this subsection is exempt from
 
disclosure under the freedom of information act, 1976 PA 442, MCL
 
15.231 to 15.246.
 
     (4) An applicant must certify that the applicant does not have
 
an interest in any other state operating license that is prohibited
 
under this act.
 
     (5) A nonrefundable application fee must be paid at the time
 
of filing to defray the costs associated with the background
 
investigation conducted by the board. The department in
 
consultation with the board shall set the amount of the application
 
fee for each category and class of license by rule. If the costs of
 
the investigation and processing the application exceed the
 
application fee, the applicant shall pay the additional amount to
 
the board. All information, records, interviews, reports,
 
statements, memoranda, or other data supplied to or used by the
 
board in the course of its review or investigation of an
 
application for a license under this act shall be disclosed only in
 
accordance with this act. The information, records, interviews,
 
reports, statements, memoranda, or other data are not admissible as
 
evidence or discoverable in any action of any kind in any court or
 
before any tribunal, board, agency, or person, except for any
 
action considered necessary by the board.
 
     (6) By 10 days after the date the applicant submits an
 
application to the board, the applicant shall notify the
 
municipality by registered mail that it has applied for a license
 
under this act.
 
     Sec. 402. (1) The board shall issue a license to an applicant
 
who submits a complete application and pays both the nonrefundable
 
application fee required under section 401(5) and the regulatory
 
assessment established by the board for the first year of
 
operation, if the board determines that the applicant is qualified
 
to receive a license under this act.
 
     (2) An applicant is ineligible to receive a license if any of
 
the following circumstances exist:
 
     (a) The applicant has been convicted of or released from
 
incarceration for a felony under the laws of this state, any other
 
state, or the United States within the past 10 years or has been
 
convicted of a controlled substance-related felony within the past
 
10 years.
 
     (b) Within the past 5 years the applicant has been convicted
 
of a misdemeanor involving a controlled substance, theft,
 
dishonesty, or fraud in any state or been found responsible for
 
violating a local ordinance in any state involving a controlled
 
substance, dishonesty, theft, or fraud that substantially
 
corresponds to a misdemeanor in that state.
 
     © The applicant has knowingly submitted an application for a
 
license under this act that contains false information.
 
     (d) The applicant is a member of the board.
 
     (e) The applicant fails to demonstrate the applicant's ability
 
to maintain adequate premises liability and casualty insurance for
 
its proposed marihuana facility.
 
     (f) The applicant holds an elective office of a governmental
 
unit of this state, another state, or the federal government; is a
 
member of or employed by a regulatory body of a governmental unit
 
in this state, another state, or the federal government; or is
 
employed by a governmental unit of this state. This subdivision
 
does not apply to an elected officer of or employee of a federally
 
recognized Indian tribe or to an elected precinct delegate.
 
     (g) The applicant, if an individual, has been a resident of
 
this state for less than a continuous 2-year period immediately
 
preceding the date of filing the application. The requirements in
 
this subdivision do not apply after June 30, 2018.
 
     (h) The board determines that the applicant is not in
 
compliance with section 205(1).
 
     (i) The applicant fails to meet other criteria established by
 
rule.
 
     (3) In determining whether to grant a license to an applicant,
 
the board may also consider all of the following:
 
     (a) The integrity, moral character, and reputation; personal
 
and business probity; financial ability and experience; and
 
responsibility or means to operate or maintain a marihuana facility
 
of the applicant and of any other person that either:
 
     (i) Controls, directly or indirectly, the applicant.
 
     (ii) Is controlled, directly or indirectly, by the applicant
 
or by a person who controls, directly or indirectly, the applicant.
 
     (b) The financial ability of the applicant to purchase and
 
maintain adequate liability and casualty insurance.
 
     © The sources and total amount of the applicant's
 
capitalization to operate and maintain the proposed marihuana
 
facility.
 
     (d) Whether the applicant has been indicted for, charged with,
 
arrested for, or convicted of, pled guilty or nolo contendere to,
 
forfeited bail concerning, or had expunged any relevant criminal
 
offense under the laws of any jurisdiction, either felony or
 
misdemeanor, not including traffic violations, regardless of
 
whether the offense has been expunged, pardoned, or reversed on
 
appeal or otherwise.
 
     (e) Whether the applicant has filed, or had filed against it,
 
a proceeding for bankruptcy within the past 7 years.
 
     (f) Whether the applicant has been served with a complaint or
 
other notice filed with any public body regarding payment of any
 
tax required under federal, state, or local law that has been
 
delinquent for 1 or more years.
 
     (g) Whether the applicant has a history of noncompliance with
 
any regulatory requirements in this state or any other
 
jurisdiction.
 
     (h) Whether at the time of application the applicant is a
 
defendant in litigation involving its business practices.
 
     (i) Whether the applicant meets other standards in rules
 
applicable to the license category.
 
     (4) Each applicant shall submit with its application, on forms
 
provided by the board, a passport quality photograph and 1 set of
 
fingerprints for each person having any ownership interest in the
 
marihuana facility and each person who is an officer, director, or
 
managerial employee of the applicant. The department may designate
 
an entity or agent to collect the fingerprints, and the applicant
 
is responsible for the cost associated with the fingerprint
 
collection.
 
     (5) The board shall review all applications for licenses and
 
shall inform each applicant of the board's decision.
 
     (6) A license shall be issued for a 1-year period and is
 
renewable annually. Except as otherwise provided in this act, the
 
board shall renew a license if all of the following requirements
 
are met:
 
     (a) The licensee applies to the board on a renewal form
 
provided by the board that requires information prescribed in
 
rules.
 
     (b) The application is received by the board on or before the
 
expiration date of the current license.
 
     © The licensee pays the regulatory assessment under section
 
603.
 
     (d) The licensee meets the requirements of this act and any
 
other renewal requirements set forth in rules.
 
     (7) The department shall notify the licensee by mail or
 
electronic mail at the last known address on file with the board
 
advising of the time, procedure, and regulatory assessment under
 
section 603. The failure of the licensee to receive notice under
 
this subsection does not relieve the licensee of the responsibility
 
for renewing the license.
 
     (8) If a license renewal application is not submitted by the
 
license expiration date, the license may be renewed within 60 days
 
after its expiration date upon application, payment of the
 
regulatory assessment under section 603, and satisfaction of any
 
renewal requirement and late fee set forth in rules. The licensee
 
may continue to operate during the 60 days after the license
 
expiration date if the license is renewed by the end of the 60-day
 
period.
 
     (9) License expiration does not terminate the board's
 
authority to impose sanctions on a licensee whose license has
 
expired.
 
     (10) In its decision on an application for renewal, the board
 
shall consider any specific written input it receives from an
 
individual or entity within the local unit of government in which
 
the applicant for renewal is located.
 
     (11) A licensee must consent in writing to inspections,
 
examinations, searches, and seizures that are permitted under this
 
act and must provide a handwriting exemplar, fingerprints,
 
photographs, and information as authorized in this act or by rules.
 
     (12) An applicant or licensee has a continuing duty to provide
 
information requested by the board and to cooperate in any
 
investigation, inquiry, or hearing conducted by the board.
 
     Sec. 403. If the board identifies a deficiency in an
 
application, the board shall provide the applicant with a
 
reasonable period of time to correct the deficiency.
 
     Sec. 404. (1) The board shall issue a license only in the name
 
of the true party of interest.
 
     (2) For the following true parties of interest, information
 
concerning the indicated individuals must be included in the
 
disclosures required of an applicant or licensee:
 
     (a) For an individual or sole proprietorship: the proprietor
 
and spouse.
 
     (b) For a partnership and limited liability partnership: all
 
partners and their spouses. For a limited partnership and limited
 
liability limited partnership: all general and limited partners and
 
their spouses. For a limited liability company: all members,
 
managers, and their spouses.
 
     © For a privately held corporation: all corporate officers
 
or persons with equivalent titles and their spouses and all
 
stockholders and their spouses.
 
     (d) For a publicly held corporation: all corporate officers or
 
persons with equivalent titles and their spouses.
 
     (e) For a multilevel ownership enterprise: any entity or
 
person that receives or has the right to receive a percentage of
 
the gross or net profit from the enterprise during any full or
 
partial calendar or fiscal year.
 
     (f) For a nonprofit corporation: all individuals and entities
 
with membership or shareholder rights in accordance with the
 
articles of incorporation or the bylaws and their spouses.
 
     (3) For purposes of this section, "true party of interest"
 
does not mean:
 
     (a) A person or entity receiving reasonable payment for rent
 
on a fixed basis under a bona fide lease or rental obligation,
 
unless the lessor or property manager exercises control over or
 
participates in the management of the business.
 
     (b) A person who receives a bonus as an employee if the
 
employee is on a fixed wage or salary and the bonus is not more
 
than 25% of the employee's prebonus annual compensation or if the
 
bonus is based on a written incentive/bonus program that is not out
 
of the ordinary for the services rendered.
 
     Sec. 405. Subject to the laws of this state, before hiring a
 
prospective employee, the holder of a license shall conduct a
 
background check of the prospective employee. If the background
 
check indicates a pending charge or conviction within the past 10
 
years for a controlled substance-related felony, a licensee shall
 
not hire the prospective employee without written permission of the
 
board.
 
     Sec. 406. Each license is exclusive to the licensee, and a
 
licensee or any other person must apply for and receive the board's
 
approval before a license is transferred, sold, or purchased. The
 
attempted transfer, sale, or other conveyance of an interest of
 
more than 1% in a license without prior board approval is grounds
 
for suspension or revocation of the license or for other sanction
 
considered appropriate by the board.
 
     Sec. 407. (1) If an applicant or licensee fails to comply with
 
this act or rules, if a licensee fails to comply with the marihuana
 
tracking act, if a licensee no longer meets the eligibility
 
requirements for a license under this act, or if an applicant or
 
licensee fails to provide information the board requests to assist
 
in any investigation, inquiry, or board hearing, the board may
 
deny, suspend, revoke, or restrict a license. The board may
 
suspend, revoke, or restrict a license and require the removal of a
 
licensee or an employee of a licensee for a violation of this act,
 
rules, the marihuana tracking act, or any ordinance adopted under
 
section 205. The board may impose civil fines of up to $5,000.00
 
against an individual and up to $10,000.00 or an amount equal to
 
the daily gross receipts, whichever is greater, against a licensee
 
for each violation of this act, rules, or an order of the board.
 
Assessment of a civil fine under this subsection is not a bar to
 
the investigation, arrest, charging, or prosecution of an
 
individual for any other violation of this act and is not grounds
 
to suppress evidence in any criminal prosecution that arises under
 
this act or any other law of this state.
 
     (2) The board shall comply with the administrative procedures
 
act of 1969, 1969 PA 306, MCL 24.201 to 24.328, when denying,
 
revoking, suspending, or restricting a license or imposing a fine.
 
The board may suspend a license without notice or hearing upon a
 
determination that the safety or health of patrons or employees is
 
jeopardized by continuing a marihuana facility's operation. If the
 
board suspends a license under this subsection without notice or
 
hearing, a prompt postsuspension hearing must be held to determine
 
if the suspension should remain in effect. The suspension may
 
remain in effect until the board determines that the cause for
 
suspension has been abated. The board may revoke the license or
 
approve a transfer or sale of the license upon a determination that
 
the licensee has not made satisfactory progress toward abating the
 
hazard.
 
     (3) After denying an application for a license, the board
 
shall, upon request, provide a public investigative hearing at
 
which the applicant is given the opportunity to present testimony
 
and evidence to establish its suitability for a license. Other
 
testimony and evidence may be presented at the hearing, but the
 
board's decision must be based on the whole record before the board
 
and is not limited to testimony and evidence submitted at the
 
public investigative hearing.
 
     (4) Except for license applicants who may be granted a hearing
 
at the discretion of the board under subsection (3), any party
 
aggrieved by an action of the board suspending, revoking,
 
restricting, or refusing to renew a license, or imposing a fine,
 
shall be given a hearing before the board upon request. A request
 
for a hearing must be made to the board in writing within 21 days
 
after service of notice of the action of the board. Notice of the
 
action of the board must be served either by personal delivery or
 
by certified mail, postage prepaid, to the aggrieved party. Notice
 
served by certified mail is considered complete on the business day
 
following the date of the mailing.
 
     (5) The board may conduct investigative and contested case
 
hearings; issue subpoenas for the attendance of witnesses; issue
 
subpoenas duces tecum for the production of books, ledgers,
 
records, memoranda, electronically retrievable data, and other
 
pertinent documents; and administer oaths and affirmations to
 
witnesses as appropriate to exercise and discharge the powers and
 
duties of the board under this act. The executive director or his
 
or her designee may issue subpoenas and administer oaths and
 
affirmations to witnesses.
 
     Sec. 408. (1) Before the board grants or renews any license
 
under this act, the licensee or applicant shall file with the
 
department proof of financial responsibility for liability for
 
bodily injury to lawful users resulting from the manufacture,
 
distribution, transportation, or sale of adulterated marihuana or
 
adulterated marihuana-infused product in an amount not less than
 
$100,000.00. The proof of financial responsibility may be in the
 
form of cash, unencumbered securities, a liability insurance
 
policy, or a constant value bond executed by a surety company
 
authorized to do business in this state. As used this section:
 
     (a) "Adulterated marihuana" means a product sold as marihuana
 
that contains any unintended substance or chemical or biological
 
matter other than marihuana that causes adverse reaction after
 
ingestion or consumption.
 
     (b) "Bodily injury" does not include expected or intended
 
effect or long-term adverse effect of smoking, ingestion, or
 
consumption of marihuana or marihuana-infused product.
 
     (2) An insured licensee shall not cancel liability insurance
 
required under this section unless the licensee complies with both
 
of the following:
 
     (a) Gives 30 days' prior written notice to the department.
 
     (b) Procures new proof of financial responsibility required
 
under this section and delivers that proof to the department within
 
30 days after giving the department the notice under subdivision
 
(a).
 
     Sec. 409. A state operating license is a revocable privilege
 
granted by this state and is not a property right. Granting a
 
license does not create or vest any right, title, franchise, or
 
other property interest. Each license is exclusive to the licensee,
 
and a licensee or any other person must apply for and receive the
 
board's and municipality's approval before a license is
 
transferred, sold, or purchased. A licensee or any other person
 
shall not lease, pledge, or borrow or loan money against a license.
 
The attempted transfer, sale, or other conveyance of an interest in
 
a license without prior board approval is grounds for suspension or
 
revocation of the license or for other sanction considered
 
appropriate by the board.
 
PART 5. LICENSEES
 
     Sec. 501. (1) A grower license authorizes the grower to grow
 
not more than the following number of marihuana plants under the
 
indicated license class for each license the grower holds in that
 
class:
 
     (a) Class A – 500 marihuana plants.
 
     (b) Class B – 1,000 marihuana plants.
 
     © Class C – 1,500 marihuana plants.
 
     (2) A grower license authorizes sale of marihuana seeds or
 
marihuana plants only to a grower by means of a secure transporter.
 
     (3) A grower license authorizes sale of marihuana, other than
 
seeds, only to a processor or provisioning center.
 
     (4) A grower license authorizes the grower to transfer
 
marihuana only by means of a secure transporter.
 
     (5) To be eligible for a grower license, the applicant and
 
each investor in the grower must not have an interest in a secure
 
transporter or safety compliance facility.
 
     (6) A grower shall comply with all of the following:
 
     (a) Until December 31, 2021, have, or have as an active
 
employee an individual who has, a minimum of 2 years' experience as
 
a registered primary caregiver.
 
     (b) While holding a license as a grower, not be a registered
 
primary caregiver and not employ an individual who is
 
simultaneously a registered primary caregiver.
 
     © Enter all transactions, current inventory, and other
 
information into the statewide monitoring system as required in
 
this act, rules, and the marihuana tracking act.
 
     (7) A grower license does not authorize the grower to operate
 
in an area unless the area is zoned for industrial or agricultural
 
uses or is unzoned and otherwise meets the requirements established
 
in section 205(1).
 
     Sec. 502. (1) A processor license authorizes purchase of
 
marihuana only from a grower and sale of marihuana-infused products
 
or marihuana only to a provisioning center.
 
     (2) A processor license authorizes the processor to transfer
 
marihuana only by means of a secure transporter.
 
     (3) To be eligible for a processor license, the applicant and
 
each investor in the processor must not have an interest in a
 
secure transporter or safety compliance facility.
 
     (4) A processor shall comply with all of the following:
 
     (a) Until December 31, 2021, have, or have as an active
 
employee an individual who has, a minimum of 2 years' experience as
 
a registered primary caregiver.
 
     (b) While holding a license as a processor, not be a
 
registered primary caregiver and not employ an individual who is
 
simultaneously a registered primary caregiver.
 
     © Enter all transactions, current inventory, and other
 
information into the statewide monitoring system as required in
 
this act, rules, and the marihuana tracking act.
 
     Sec. 503. (1) A secure transporter license authorizes the
 
licensee to store and transport marihuana and money associated with
 
the purchase or sale of marihuana between marihuana facilities for
 
a fee upon request of a person with legal custody of that marihuana
 
or money. It does not authorize transport to a registered
 
qualifying patient or registered primary caregiver.
 
     (2) To be eligible for a secure transporter license, the
 
applicant and each investor with an interest in the secure
 
transporter must not have an interest in a grower, processor,
 
provisioning center, or safety compliance facility and must not be
 
a registered qualifying patient or a registered primary caregiver.
 
     (3) A secure transporter shall enter all transactions, current
 
inventory, and other information into the statewide monitoring
 
system as required in this act, rules, and the marihuana tracking
 
act.
 
     (4) A secure transporter shall comply with all of the
 
following:
 
     (a) Each driver transporting marihuana must have a chauffeur's
 
license issued by this state.
 
     (b) Each employee who has custody of marihuana or money that
 
is related to a marihuana transaction shall not have been convicted
 
of or released from incarceration for a felony under the laws of
 
this state, any other state, or the United States within the past 5
 
years or have been convicted of a misdemeanor involving a
 
controlled substance within the past 5 years.
 
     © Each vehicle shall be operated with a 2-person crew with
 
at least 1 individual remaining with the vehicle at all times
 
during the transportation of marihuana.
 
     (d) A route plan and manifest shall be entered into the
 
statewide monitoring system, and a copy shall be carried in the
 
transporting vehicle and presented to a law enforcement officer
 
upon request.
 
     (e) The marihuana shall be transported in 1 or more sealed
 
containers and not be accessible while in transit.
 
     (f) A secure transporting vehicle shall not bear markings or
 
other indication that it is carrying marihuana or a marihuana-
 
infused product.
 
     (5) A secure transporter is subject to administrative
 
inspection by a law enforcement officer at any point during the
 
transportation of marihuana to determine compliance with this act.
 
     Sec. 504. (1) A provisioning center license authorizes the
 
purchase or transfer of marihuana only from a grower or processor
 
and sale or transfer to only a registered qualifying patient or
 
registered primary caregiver. All transfers of marihuana to a
 
provisioning center from a separate marihuana facility shall be by
 
means of a secure transporter.
 
     (2) A provisioning center license authorizes the provisioning
 
center to transfer marihuana to or from a safety compliance
 
facility for testing by means of a secure transporter.
 
     (3) To be eligible for a provisioning center license, the
 
applicant and each investor in the provisioning center must not
 
have an interest in a secure transporter or safety compliance
 
facility.
 
     (4) A provisioning center shall comply with all of the
 
following:
 
     (a) Sell or transfer marihuana to a registered qualifying
 
patient or registered primary caregiver only after it has been
 
tested and bears the label required for retail sale.
 
     (b) Enter all transactions, current inventory, and other
 
information into the statewide monitoring system as required in
 
this act, rules, and the marihuana tracking act.
 
     © Before selling or transferring marihuana to a registered
 
qualifying patient or to a registered primary caregiver on behalf
 
of a registered qualifying patient, inquire of the statewide
 
monitoring system to determine whether the patient and, if
 
applicable, the caregiver hold a valid, current, unexpired, and
 
unrevoked registry identification card and that the sale or
 
transfer will not exceed the daily purchasing limit established by
 
the medical marihuana licensing board under this act.
 
     (d) Not allow the sale, consumption, or use of alcohol or
 
tobacco products on the premises.
 
     (e) Not allow a physician to conduct a medical examination or
 
issue a medical certification document on the premises for the
 
purpose of obtaining a registry identification card.
 
     Sec. 505. (1) In addition to transfer and testing authorized
 
in section 203, a safety compliance facility license authorizes the
 
facility to receive marihuana from, test marihuana for, and return
 
marihuana to only a marihuana facility.
 
     (2) A safety compliance facility must be accredited by an
 
entity approved by the board by 1 year after the date the license
 
is issued or have previously provided drug testing services to this
 
state or this state's court system and be a vendor in good standing
 
in regard to those services. The board may grant a variance from
 
this requirement upon a finding that the variance is necessary to
 
protect and preserve the public health, safety, or welfare.
 
     (3) To be eligible for a safety compliance facility license,
 
the applicant and each investor with any interest in the safety
 
compliance facility must not have an interest in a grower, secure
 
transporter, processor, or provisioning center.
 
     (4) A safety compliance facility shall comply with all of the
 
following:
 
     (a) Perform tests to certify that marihuana is reasonably free
 
of chemical residues such as fungicides and insecticides.
 
     (b) Use validated test methods to determine
 
tetrahydrocannabinol, tetrahydrocannabinol acid, cannabidiol, and
 
cannabidiol acid levels.
 
     © Perform tests that determine whether marihuana complies
 
with the standards the board establishes for microbial and
 
mycotoxin contents.
 
     (d) Perform other tests necessary to determine compliance with
 
any other good manufacturing practices as prescribed in rules.
 
     (e) Enter all transactions, current inventory, and other
 
information into the statewide monitoring system as required in
 
this act, rules, and the marihuana tracking act.
 
     (f) Have a secured laboratory space that cannot be accessed by
 
the general public.
 
     (g) Retain and employ at least 1 staff member with a relevant
 
advanced degree in a medical or laboratory science.
 
PART 6. TAXES AND FEES
 
     Sec. 601. (1) A tax is imposed on each provisioning center at
 
the rate of 3% of the provisioning center's gross retail receipts.
 
By 30 days after the end of the calendar quarter, a provisioning
 
center shall remit the tax for the preceding calendar quarter to
 
the department of treasury accompanied by a form prescribed by the
 
department of treasury that shows the gross quarterly retail income
 
of the provisioning center and the amount of tax due, and shall
 
submit a copy of the form to the department. If a law authorizing
 
the recreational or nonmedical use of marihuana in this state is
 
enacted, this section does not apply beginning 90 days after the
 
effective date of that law.
 
     (2) The taxes imposed under this section shall be administered
 
by the department of treasury in accordance with 1941 PA 122, MCL
 
205.1 to 205.31, and this act. In case of conflict between the
 
provisions of 1941 PA 122, MCL 205.1 to 205.31, and this act, the
 
provisions of this act prevail.
 
     Sec. 602. (1) The medical marihuana excise fund is created in
 
the state treasury.
 
     (2) Except for the application fee under section 401, the
 
regulatory assessment under section 603, and any local licensing
 
fees, all money collected under section 601 and all other fees,
 
fines, and charges, imposed under this act shall be deposited in
 
the medical marihuana excise fund. The state treasurer shall direct
 
the investment of the fund. The state treasurer shall credit to the
 
fund interest and earnings from fund investments.
 
     (3) Money in the medical marihuana excise fund at the close of
 
the fiscal year shall remain in the fund and shall not lapse to the
 
general fund.
 
     (4) The state treasurer shall be the administrator of the
 
medical marihuana excise fund for auditing purposes.
 
     (5) The money in the medical marihuana excise fund shall be
 
allocated, upon appropriation, as follows:
 
     (a) 25% to municipalities in which a marihuana facility is
 
located, allocated in proportion to the number of marihuana
 
facilities within the municipality.
 
     (b) 30% to counties in which a marihuana facility is located,
 
allocated in proportion to the number of marihuana facilities
 
within the county.
 
     © 5% to counties in which a marihuana facility is located,
 
House Bill No. 4209 as amended September 8, 2016
 
allocated in proportion to the number of marihuana facilities
 
within the county. Money allocated under this subdivision shall be
 
used exclusively to support the county sheriffs and shall be in
 
addition to and not in replacement of any other funding received by
 
the county sheriffs.
 
     (d) 30% to this state for the following:
 
     (i) Until September 30, <<2017>>, for deposit in the general fund
 
of the state treasury.
 
     (ii) Beginning October 1, <<2017>>, for deposit in the first
 
responder presumed coverage fund created in section 405 of the
 
worker's disability compensation act of 1969, 1969 PA 317, MCL
 
418.405.
 
     (e) 5% to the Michigan commission on law enforcement standards
 
for training local law enforcement officers.
 
     (f) 5% to the department of state police.
 
     Sec. 603. (1) A regulatory assessment is imposed on certain
 
licensees as provided in this section. All of the following shall
 
be included in establishing the total amount of the regulatory
 
assessment established under this section:
 
     (a) The department's costs to implement, administer, and
 
enforce this act, except for the costs to process and investigate
 
applications for licenses supported with the application fee
 
described in section 401.
 
     (b) Expenses of medical-marihuana-related legal services
 
provided to the department by the department of attorney general.
 
     © Expenses of medical-marihuana-related services provided to
 
the department by the department of state police.
 
     (d) Expenses of medical-marihuana-related services provided by
 
the department of treasury.
 
     (e) $500,000.00 to be allocated to the department for
 
expenditures of the department for licensing substance use disorder
 
programs.
 
     (f) An amount equal to 5% of the sum of the amounts provided
 
for under subdivisions (a) to (d) to be allocated to the department
 
of health and human services for substance-abuse-related
 
expenditures including, but not limited to, substance use disorder
 
prevention, education, and treatment programs.
 
     (g) Expenses related to the standardized field sobriety tests
 
administered in enforcing the Michigan vehicle code, 1949 PA 300,
 
MCL 257.1 to 257.923.
 
     (h) An amount sufficient to provide for the administrative
 
costs of the Michigan commission on law enforcement standards.
 
     (2) The regulatory assessment is in addition to the
 
application fee described in section 401, the tax described in
 
section 601, and any local licensing fees.
 
     (3) The regulatory assessment shall be collected annually from
 
licensed growers, processors, provisioning centers, and secure
 
transporters. The regulatory assessment for a class A grower
 
license shall not exceed $10,000.00.
 
     (4) Beginning in the first year marihuana facilities are
 
authorized to operate in this state, and annually thereafter, the
 
department, in consultation with the board, shall establish the
 
total regulatory assessment at an amount that is estimated to be
 
sufficient to cover the actual costs and support the expenditures
 
listed in subsection (1).
 
     (5) On or before the date the licensee begins operating and
 
annually thereafter, each grower, processor, provisioning center,
 
and secure transporter shall pay to the state treasurer an amount
 
determined by the department to reasonably reflect the licensee's
 
share of the total regulatory assessment established under
 
subsection (4).
 
     Sec. 604. (1) The marihuana regulatory fund is created in the
 
state treasury.
 
     (2) The application fee collected under section 401 and the
 
regulatory assessment collected under section 603 shall be
 
deposited in the marihuana regulatory fund. The state treasurer
 
shall direct the investment of the fund. The state treasurer shall
 
credit to the fund interest and earnings from fund investments.
 
     (3) Money in the marihuana regulatory fund at the close of the
 
fiscal year shall remain in the fund and shall not lapse to the
 
general fund.
 
     (4) The department shall be the administrator of the marihuana
 
regulatory fund for auditing purposes.
 
     (5) Except as provided in section 603(1)(d) and (e), the
 
department shall expend money from the marihuana regulatory fund,
 
upon appropriation, only for implementing, administering, and
 
enforcing this act.
 
     Sec. 605. The department may use any money appropriated to it
 
from the marihuana registry fund created in section 6 of the
 
Michigan medical marihuana act, 2008 IL 1, MCL 333.26426, for the
 
purpose of funding the operations of the department and the board
 
in the initial implementation and subsequent administration and
 
enforcement of this act.
 
PART 7. REPORTS
 
     Sec. 701. By 30 days after the end of each state fiscal year,
 
each licensee shall transmit to the board and to the municipality
 
financial statements of the licensee's total operations. The
 
financial statements shall be reviewed by a certified public
 
accountant in a manner and form prescribed by the board. The
 
certified public accountant must be licensed in this state under
 
article 7 of the occupational code, 1980 PA 299, MCL 339.720 to
 
339.736. The compensation for the certified public accountant shall
 
be paid directly by the licensee to the certified public
 
accountant.
 
     Sec. 702. The board shall submit with the annual report to the
 
governor under section 302(k) and to the chairs of the legislative
 
committees that govern issues related to marihuana facilities a
 
report covering the previous year. The report shall include an
 
account of the board actions, its financial position, results of
 
operation under this act, and any recommendations for legislation
 
that the board considers advisable.
 
PART 8. MARIHUANA ADVISORY PANEL
 
     Sec. 801. (1) The marihuana advisory panel is created within
 
the department.
 
     (2) The marihuana advisory panel shall consist of 17 members,
 
including the director of state police or his or her designee, the
 
director of this state's department of health and human services or
 
his or her designee, the director of the department of licensing
 
and regulatory affairs or his or her designee, the attorney general
 
or his or her designee, the director of the department of
 
agriculture and rural development or his or her designee, and the
 
following members appointed by the governor:
 
     (a) One registered medical marihuana patient or medical
 
marihuana primary caregiver.
 
     (b) One representative of growers.
 
     © One representative of processors.
 
     (d) One representative of provisioning centers.
 
     (e) One representative of safety compliance facilities.
 
     (f) One representative of townships.
 
     (g) One representative of cities and villages.
 
     (h) One representative of counties.
 
     (i) One representative of sheriffs.
 
     (j) One representative of local police.
 
     (k) One physician licensed under article 15 of the public
 
health code, 1978 PA 368, MCL 333.16101 to 333.18838.
 
     (l) One representative of a secure transporter.
 
     (3) The members first appointed to the panel shall be
 
appointed within 3 months after the effective date of this act and
 
shall serve at the pleasure of the governor. Appointed members of
 
the panel shall serve for terms of 3 years or until a successor is
 
appointed, whichever is later.
 
     (4) If a vacancy occurs on the advisory panel, the governor
 
shall make an appointment for the unexpired term in the same manner
 
as the original appointment.
 
     (5) The first meeting of the panel shall be called by the
 
director of the department or his or her designee within 1 month
 
after the advisory panel is appointed. At the first meeting, the
 
panel shall elect from among its members a chairperson and any
 
other officers it considers necessary or appropriate. After the
 
first meeting, the panel shall meet at least 2 times each year, or
 
more frequently at the call of the chairperson.
 
     (6) A majority of the members of the panel constitute a quorum
 
for the transaction of business. A majority of the members present
 
and serving are required for official action of the panel.
 
     (7) The business that the panel performs shall be conducted at
 
a public meeting held in compliance with the open meetings act,
 
1976 PA 267, MCL 15.261 to 15.275.
 
     (8) A writing prepared, owned, used, in the possession of, or
 
retained by the panel in the performance of an official function is
 
subject to the freedom of information act, 1976 PA 442, MCL 15.231
 
to 15.246.
 
     (9) Members of the panel shall serve without compensation.
 
However, members of the panel may be reimbursed for their actual
 
and necessary expenses incurred in the performance of their
 
official duties as members of the panel.
 
     (10) The panel may make recommendations to the board
 
concerning promulgation of rules and, as requested by the board or
 
the department, the administration, implementation, and enforcement
 
of this act and the marihuana tracking act.
 
     (11) State departments and agencies shall cooperate with the
 
panel and, upon request, provide it with meeting space and other
 
necessary resources to assist it in the performance of its duties.
 
     Enacting section 1. This act takes effect 90 days after the
 
date it is enacted into law.
 
     Enacting section 2. The legislature finds that the necessity
 
for access to safe sources of marihuana for medical use and the
 
immediate need for growers, processors, secure transporters,
 
provisioning centers, and safety compliance facilities to operate
 
under clear requirements establish the need to promulgate emergency
 
rules to preserve the public health, safety, or welfare.
 
     Enacting section 3. This act does not take effect unless House
 
Bill No. 4827 of the 98th Legislature is enacted into law.
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Off the top of my head, I would think converting from caregiver to grower (any class) will run about $25,000 and a lot of headaches.  If you want to also process or sell direct what you grow, you will need to double that.

 

Also, unless I am missing it, you have to be a licensed grower to buy seeds and you can only buy them from another licensed grower.  How does the ball get rolling, legally speaking?

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Off the top of my head, I would think converting from caregiver to grower (any class) will run about $25,000 and a lot of headaches.  If you want to also process or sell direct what you grow, you will need to double that.

 

Also, unless I am missing it, you have to be a licensed grower to buy seeds and you can only buy them from another licensed grower.  How does the ball get rolling, legally speaking?

the ball gets rolling when a friend of a legislator puts up the money for the seed shop.
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   (3) In determining whether to grant a license to an applicant,

 
the board may also consider all of the following:
 
     (a) The integrity, moral character, and reputation; personal
 
and business probity; financial ability and experience; and
 
responsibility or means to operate or maintain a marihuana facility
 
of the applicant and of any other person that either:
 
     (i) Controls, directly or indirectly, the applicant.
 
     (ii) Is controlled, directly or indirectly, by the applicant
 
or by a person who controls, directly or indirectly, the applicant.
 
     (b) The financial ability of the applicant to purchase and
 
maintain adequate liability and casualty insurance.
 
     © The sources and total amount of the applicant's
 
capitalization to operate and maintain the proposed marihuana
 
facility.
 
So it appears the board can come up with an arbitrary amount of liquid capital one must have access to in order to be approved, say like 50K? 100K 250K? To keep the riff raff out they might need to see $1,000,000 in accessible capital. Wouldn't be unheard of (see Illinois). 
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Keep reading....

 

100k

  Sec. 408. (1) Before the board grants or renews any license

 
under this act, the licensee or applicant shall file with the
 
department proof of financial responsibility for liability for
 
bodily injury to lawful users resulting from the manufacture,
 
distribution, transportation, or sale of adulterated marihuana or
 
adulterated marihuana-infused product in an amount not less than
 
$100,000.00. The proof of financial responsibility may be in the
 
form of cash, unencumbered securities, a liability insurance
 
policy, or a constant value bond executed by a surety company
 

authorized to do business in this state.

 

 

Sounds like that 100K is just for liability purposes and doesn't even begin to cover capitalization to operate and maintain the proposed marihuana facility.

 

Still reading...

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I haven't read the whole bill, but I did read the original back in February. I seem to remember something about caregivers CANNOT be considered for a license. Anyone know if this is true?

 

You cannot be a caregiver and have an interest in any of the licenses outlined.  However, as a licensed grower you will need to employee someone who has at least two years experience as a caregiver.  If you're already a caregiver with two years experience, you could drop your patients and covert to licensed grower status for about $150,000.

 

The original bill would have regulated dispensaries and allowed them to buy from patients and caregivers.

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So what does this mean for caregivers?can they still grow for patients?

yes. It essentally creates an entire new system for dispensaries. You can stay in the caregiver system or the regulatory system, but you can't do both. You need two years experience as cg to grow under the new scheme.

 

Wet

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Only the people with tons of money will have cheap prices.  You can be a grower, processor and a dispensary if you can afford both, and that cuts out at least 1 transport, but you would have to do it all at 1 location.  So you need to be able to front a 500 plant grow, licensing in the 10's of thousands, prob $50-75k in grow equipment, and a facility large enough to house the grow, processing, AND a dispensary all in 1...

 

I really hoped they wouldn't do this, but it is all about big money here in Michigan...  And most of the people who will afford this will be from out of state...

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Is the $150,000 fee for each three classes?I think it should vary on plant count.

Also does this mean price per gram will drop at the dispensaries since they'll be able to grow for themselves or up since they're being taxed?.

 

The $150,000 price tag I mention is based on: a) needing $100,000 in liability (this could be insurance but maybe hard to get so you may need to have this in real property), b) up to $5,000 in fees to the local municipality, c) up to $10,000 to the state for the license, and d) the costs of your actual business.

 

As far as price, I think we will see that drop like it has in other states with a dispensary system, but I would think that market effect is at least two years out since it might be a year before the first one even opens.

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no one wants taxes on medical marijuana except npra and the fknrepublicans

 

I support taxes only on legal weed for everyone. and no taxes on home grows ever...

Yup, there should be no tax on Medicine.  You want to tax recreational at 20%, I support that, but medicine for those who NEED it, no TAX.  I am with you on this.

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