As the weather begins to change and we enter the Fall season, Michigan’s marijuana industry continues to grow. September saw a number of exciting developments that we at the Law Offices of Joseph Nafsu want to make sure you are aware of.
With so much going on in the world, it can be hard to keep track of what is happening, and these are issues that we believe will matter to your business both today and in the days to come. As always, if you have any questions or concerns about your marijuana business, we are ready and able to help you.
Starting October 11, It Will Be Illegal For Businesses To Sell The Delta-8 Strain Without Proper Licensing
While the Delta-8 cannabis compound is similar to the Delta-9 compound, but it occurs in smaller quantities, which has led to Delta-8 being synthesized via a conversion process that turns hemp-derived CBD into Delta-8.
Because Delta-8 is derived from CBD which has been extracted from federally legal hemp, it has remained legal in many states where cannabis sales are still illegal, but the federal Drug Enforcement Administration has proposed a rule that would classify Delta-8 as a Schedule 1 controlled substance, making sales illegal in any state where marijuana sales are prohibited.
Because the process that creates Delta-8 has been largely unregulated and untested, it is unclear what the effects of Delta-8 could be in the long term. With that in mind, the state of Michigan has classified Delta-8 as marijuana, placing it under the purview of the Marijuana Regulatory Agency. Starting October 11, only licensed businesses will be legally allowed to sell Delta-8.
Michigan Marijuana Sales Pass $2 Billion a Year!
As we mentioned in last month’s round-up, July was the biggest month on record for Michigan marijuana sales. According to Gus Burns, writing for MLive, this puts the state’s sales at a pace to bring in over $2 billion in sales for the year!
Since the legalization of recreational marijuana in December 2019, both sales and retail locations have continued to climb as demand has grown. Currently, 360 businesses have been approved to sell recreational marijuana in the state, and more are sure to come. But with the increase in sales and businesses, prices have dropped as everyone works to stay competitive. Still, there are no signs at this point that the industry will stop growing anytime soon.
The Marijuana Regulatory Agency Has Made Their Video Library Available To The Public
The MRA has made its Social Equity Program Video Library available to everyone. These videos are a wonderful recourse for anyone in the industry to have on hand, but the rules and regulations discussed within them can still be hard to understand. Luckily, that is where we come in! If these videos bring up any questions, don’t hesitate to contact us for clarification.
The MRA Has Announced the Creation of the Joint Ventures Pathway Program
Building off of a recommendation from the Racial Equity Advisory Workgroup, the MRA has created the Joint Ventures Pathway Program, or JVPP for short.
Based on the 2018 Michigan Regulation and Taxation of Marijuana Act that directed the MRA to create a plan “to promote and encourage participation in the marijuana industry by people from communities that have been disproportionately impacted by marijuana prohibition and enforcement and to positively impact those communities,” the goal of the JVPP is to connect eligible social equity participants with businesses looking pursue partnerships with them.
The JVPP, if it works as intended, will help level the playfield for everyone, opening the industry to those who would otherwise be unable to take part.
Michigan Marijuana Regulatory Agency issued a voluntary product recall
On September 28, the MRA issued a voluntary recall for eight batches of cannabis trimmed at the Kalkaska-based cannabis company Glo.
According to the MRA bulletin, “Several batches of marijuana were run through the mechanical trimmer of Michigan Medical Marijuana, LLC (AU-G-B-000128) DBA Glo prior to retesting for microbial failures. The mechanical trimmer was contaminated with banned chemical residues Bifenthrin and Chlorfenapyr.”
The following batches were recalled:
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Michigan Senate Bill Would Allow People With Marijuana Felony Or Misdemeanor Convictions To Apply For A License With The MRA
Sen. Jeff Irwin introduced legislation that would no longer allow Michigan marijuana regulators to deny a medical cannabis license to a person based on their “moral character and reputation” or prior marijuana convictions.
Senator Irwin hopes that SB 619, will incentivize illegal sellers who can not get a license because of prior convictions to obtain their licenses through the MRA and move into the regulated market. The bill is co-sponsored by Senators Sean McCann, Stephanie Chang and Sylvia Santana.
The IRS Has Advice for Marijuana Businesses
As the industry continues to grow, and as the year gets closer to coming to an end, tax season is right around the corner. To help businesses prepare, the IRS has laid out a few suggestions and guidelines that can make reporting your income easier.
Of course, taxes can be a headache in the best of circumstances, and with the cannabis industry still being so new, navigating the laws can be very difficult. If you have any questions in regards to your taxes or dealing with the IRS, we at the Law Offices of Joseph Nafsu are here to help. Don’t put off the hard stuff for the last minute; the sooner we handle it together, the less stress you’ll feel.