Birmingham: Move carefully on cannabis issue
Michigan voters in 2018 approved Proposal 1, the Michigan Regulation and Taxation of Marijuana Act, to legalize recreational cannabis in the state by a vote of 56 to 44 percent.. Oakland County voters approved the proposal by 59 percent. In Birmingham, 62 percent of voters supported the proposal. Yet, initially, most local communities – including Birmingham – opted out of permitting cannabis businesses in their municipalities, despite the opportunity for revenue to be returned to the community.
In fiscal year 2021, Michigan had over $1.3 billion in marijuana sales for recreational use, and $481 million for medical cannabis which has been allowed since 2008. More than $111 million was collected and returned to communities from the 10 percent adult use marijuana excise tax in 2021. In 2022, combined recreational and medical cannabis sales reached $2.3 billion, according to the Michigan Cannabis Regulatory Agency.
Slowly, more and more local municipalities are permitting dispensaries and other cannabis businesses, either in order to take advantage of the money flowing in, or because petitioners who want to place a recreational marijuana facility in a community are either putting the issue on the ballot or suing communities and prevailing. Between January 1, 2022 and January 1, 2023, there were 89 different licenses issued by the state, and zero requested licenses denied. But that is a double-edge sword. In June, 2022, there were over 470 recreational dispensaries in the state, supported by 1,000 growers, leading to a flood of supply in the marketplace and a massive drop in price – those in the know say prices have plummeted more than 74 percent since 2019, making it a deal for purchasers, but less so for purveyors, some of whom have resorted to weekly specials, 'raffles on Wednesdays,' pizza tie-in deals, and numerous other ways to move product. But the market will have to sort out the issue of supply and demand.
On February 13, the Birmingham City Commission held a workshop to look at marijuana ordinances, as a preemptive move on the part of city manager Tom Markus, who is crossing items off his 'to do' list before he leaves the city June 30. Markus, who spent 22 years as Birmingham City Manager before moving on in 2010, is ever mindful of the city he will leave behind. He fully comprehends the work that will be needed to keep Birmingham humming on full cylinders, and is cognizant of what is going on in other metro Detroit towns.
Markus knows that if the city continues to opt out of permitting recreational marijuana facilities, there is the possibility Birmingham will get hit by a petitioner who will write a ballot proposal to be passed by voters, and the city will have no say in how the local ordinance is structured. Better to be proactive and write an airtight local ordinance to control the permitting process and where such facilities can be located, for example.
That is not to say that residents necessarily want a recreational cannabis dispensary in Birmingham. Many who enjoy cannabis products can easily access them via a short car drive to Royal Oak, Berkley, Ferndale, Hazel Park, Waterford, Walled Lake, among others, or can have the products delivered. But city officials say that every month someone calls to see if the city has decided to opt back in on the cannabis issue. No doubt there are many retailers who envision being part of the attractive Birmingham market and it's only a question of when someone, not necessarily a local resident, starts the ballot petition process allowed under the state law.
While we can buy into the logic that the city needs to be preemptive on this issue, we also know that writing an ordinance that can withstand a legal challenge has become a specialized field nowadays, one that requires that the city employ outside counsel beyond the standard municipal law firm. It would be money well spent to get this right the first time around.
Second, some commissioners suggested testing the community support of cannabis facilities by placing it on the city's Emgage website and running a poll, but we believe that has the potential to be flawed, as it can be manipulated by those who feel one way or another. Further, elected and appointed officials know all too well that it is only a question of when Birmingham will have to deal with this issue, so it's one of those decisions that begs for and defines leadership in a community.
Start the work now on an ordinance and make sure you get it right so the city remains in control of the process.