Michigan Marijuana Cultivation License

Does Michigan Require Marijuana Growers to Obtain Cultivation License?

Yes, Michigan requires marijuana growers in the state to obtain cultivation licenses to enable them to operate legally and in a commercial capacity. A cultivation license is commonly known as a grower license in Michigan. The Medical Marijuana Facilities Licencing Act (MMFLA) requires persons or entities interested in cultivating marijuana for medical purposes in commercial quantities to get a grower license. Similarly, under the Michigan Regulation and Taxation of Marijuana Act (MRTMA), anyone intending to cultivate marijuana for recreational purposes and in commercial capacity must obtain a grower license. The Cannabis Regulatory Agency (CRA) regulates the state's recreational marijuana establishments and licensees under the MRTMA. It also oversees Michigan's medical marijuana facilities and licenses under the MMFLA.

However, state law permits medical marijuana patients with medical marijuana cards to cultivate not more than 12 marijuana plants at home. Also, per the Michigan Regulation and Taxation of Marijuana Act (MRTMA), adults 21 years and older may grow up to 12 cannabis plants in their private residence for personal use. Growing the legally allowed number of plants at home for personal use does not require a license. In Michigan, marijuana home growers cannot profit from selling their homegrown because selling marijuana without the relevant permits or licenses is illegal and has severe consequences. The state set certain limitations on where to cultivate marijuana. Growers cannot tend marijuana plants outside of enclosed areas. Also, marijuana plants must not be noticeable by the public without using aircraft, binoculars, or other optical aids.

In Michigan, a grower license empowers the licensee to:

Sell marijuana plants, clones, or seedlings to other licensed growers
Sell leftover marijuana plant material, known as biomass, to licensed processors
Sell marijuana flower to licensed retailers and processors

What Are the Different Types of Cultivation Licenses in Michigan?

Marijuana grower licenses in Michigan are categorized according to maximum allowed plant count and are broadly divided into two. These are the medical marijuana grower licenses and recreational marijuana grower licenses. Typically, a marijuana grower license authorizes the licensee to cultivate not more than the number of marijuana plants (mature ones) under their license class. Per state's definition, a mature plant is a flowering or nonflowering marijuana plant that already has a root and is taller than 8 inches from the growing medium or wider than 8 inches, produced from a cutting, clipping, tissue culture, or seedling, and that is in a cultivating medium or growing container.

Medical Marijuana Grower Licenses

In Michigan, the Medical marijuana grower licenses are issued under the Medical Marijuana Facilities Licensing Act (MMFLA). The three license classes under this category are Class A, Class B, and Class C.

Class A authorizes a grower to cultivate not more than 500 marijuana plants.
Class B authorizes a licensee to grow not more than 1,000 marijuana plants
Class C permits the license holder to cultivate a maximum of 1,500 marijuana plants

Per Section 205(1) of the MMFLA, a medical marijuana grower licensee cannot operate in an area unless such a location is zoned for agriculture or industrial uses or is unzoned.

Recreational Marijuana Grower Licenses

These licenses are issued under the Michigan Regulation and Taxation of Marijuana Act (MRTMA). They are:

Class A license, which authorizes a grower to tend not more than 100 marijuana plants. Licensees do not need to be licensed under the MMFLA but cannot stack licenses.
Class B, which empowers a grower to cultivate up to 500 marijuana plants. License holders must be licensed under MMFLA but cannot stack licenses.
Class C, which allows a grower to grow a maximum of 2,000 marijuana plants. Class C licensees must be licensed under the MMFLA and can stack up to five Class C licenses.
Excess marijuana grower license permits the cultivation of a maximum of 10,000 marijuana plants for the recreational market. It implies that licensees can grow up to 2,000 marijuana plants for each MMFLA Class C grower license they hold. However, they must have five MRTMA Class C grower licenses and a minimum of two MMFLA Class C grower licenses. An excess marijuana grower licensee who has reached the 10,000 plants cap can expand its recreational growing activities if they have already secured additional medical grower licenses. For clarity, an excess marijuana grower license permits a licensee to assign some of their allocated medical plants to the recreational market, provided they have maximized the recreational grower license and obtained additional medical grower licenses.

Except provided by the MMFLA and the MRTMA, a marijuana grower licensee may only transfer marijuana via a marijuana secure transporter. A marijuana grower licensee can only transfer marijuana without using a marijuana secure transporter to a marijuana retailer or marijuana processor provided that:

The marijuana grower enters each marijuana transfer into Marijuana Enforcement Tracking Reporting & Compliance (METRC), the statewide monitoring system.
The marijuana retailer or marijuana processor is in the same area as the marijuana grower. In such a situation, the marijuana transfer can be done only using private real properties without accessing public highways.

To be eligible for a medical marijuana grower license or recreational marijuana grower license in Michigan, a person and each investor in the grower license must not have an interest in any safety compliance or secure transporter facility. A marijuana grower licensee must enter all current inventory, transactions, and other information into the statewide monitoring system, as required by the MRTMA and MMFLA.

Who Can Grow Marijuana in Michigan?

Per the Medical Marijuana Facilities Licensing Act (MMFLA), MCL 333.27101 et seq., a marijuana grower licensee must have a minimum of two years as a caregiver or have an active employee who has worked as a caregiver for at least two years. In Michigan, a licensed marijuana grower cannot at the same time be a registered caregiver and is prohibited from having in their employ a registered caregiver. Furthermore, the MMFLA does not prohibit a marijuana grower license holder from carrying a medical marijuana card under the Michigan Medical Marijuana Program (MMMP). Also, it does not forbid marijuana growers from hiring registered medical patients.

While a convicted felon can apply for a marijuana grower license in Michigan, the state disqualifies a person whose conviction involves the distribution of a controlled substance to a minor. Such a person cannot cultivate marijuana in Michigan. A person with a pattern of convictions involving theft, dishonesty, or fraud that shows that the proposed marijuana growing facility is not likely to be run with integrity or honesty will not be permitted to obtain a license, much less grow marijuana.

Generally, the MMFLA does not require any form of licensing by employees of licensed marijuana-growing facilities in Michigan. However, state law recommends marijuana grower licensees conduct background checks on would-be employees. A licensed marijuana-growing facility must not employ a person whose background check reveals a pending conviction in the last ten years for a controlled substance-associated felony. If a growing facility must hire such an individual, they must first obtain written permission from the Cannabis Regulatory Agency.

How to Get a Marijuana Cultivation License in Michigan

Interested persons or entities can apply for Michigan marijuana grower licenses online or using paper forms. The following are some of the documentation required to apply for a marijuana grower license in Michigan:

Copy of government-issued IDs
Entity information documents - These include a copy of governing documents (such as bylaws and operating agreement), certificate of good standing, approval to conduct business transactions in Michigan (if applicable), and authorizing resolution). Others are a copy of the organizational structure and certificate of an assumed name (obtained from LARA.
Debt, insolvency, or bankrupt documents
Tax liability and delinquency documents
Capitalizing documents - These include the CPA Attestation Form, Statement of Money Lender Form, and promissory note/line of credit documents
Regulation documents - These include a copy of marijuana licenses, a copy of any other commercial licenses or any comparable license from other jurisdiction, and a summary of facts concerning license denial, revocation, restriction, suspension, or nonrenewal
Litigation documents - These consist of a copy of a judgment or a copy of a complaint if applicable

There are two primary steps to getting a marijuana grower license in Michigan. An applicant can complete the first step before establishing the location of the proposed facility. It implies that an applicant does not need to secure a business location before starting the application process for a grower license. However, the application process is complex, and completing the relevant forms is a tedious task. Applicants may want to engage the service of experienced attorneys who have the resources to help with the application process. The steps involved in applying for a Michigan marijuana grower license are:

Step 1 - Pre-Qualification Stage

Any applicant entity intending to apply for a medical grower license in Michigan must complete the Applicant Entity Prequalification Application Form (AEPA) and provide the required supporting documentation. A sole proprietor must fill out the Sole Proprietor Prequalification Application Form (SPPA) and supply all needed documentation. Both applicant entities and sole proprietors must pay a non-refundable fee (decided by the CRA) when filing prequalification applications. Similarly, any supplemental entity (an entity that has an ownership interest in an applicant entity) must complete the Supplemental Entity Prequalification Application Form (SEPA) and provide required supporting documentation. Filling out a Supplemental Individual Prequalification Application Form (SIPA) and providing relevant supporting documentation is required of a supplemental individual (an individual that has an ownership interest in an applicant entity).

For recreational marijuana grower license, the following prequalification forms must be completed by an entity, a sole proprietor, and a supplemental individual, respectively, while also providing the required supporting documentation:

In Michigan, supplemental applicants differ based on their business structure. They include:

Generally, the prequalification stage involves conducting a thorough background check on the main applicant and supplemental applicants (individuals and businesses with an ownership interest in the main applicant) to ensure there are no disqualifying criminal convictions. During the background check, the CRA will search the criminal histories of all the applicants via several state and federal databases. During the prequalification stage, the main applicants must pay a certain non-refundable application fee. However, no application fee will be paid by supplemental applicants.

The prequalification stage equally reviews the financial competence of the applicants to determine and ensure that they satisfy the minimum financial requirements for a marijuana grower license. It also looks at their financial backgrounds to ensure they are in order and that applicants do not have unexplainable transactions or sources of income. There are minimum funding limits set by the Administrative Emergency Rules controlling the licensing process. Although the MRTMA is not keen on these limits, proof of financial responsibility is still crucial and required. Under the MMFLA, the CRA will not issues a license without an attestation showing the following minimums for each class of the marijuana grower license:

For a Class A grower license, an applicant must prove at least $150,000 in attested assets, with $37,500 of that amount being liquid.
For a Class B grower license, an applicant must show a minimum of $300,000 in attested assets, with $75,000 being liquid.
For a Class C grower license, an applicant must show at least $500,000 in attested assets, with $125,000 of the amount being liquid.

According to the MMFLA, any applicant found with any of the following disqualifying convictions or conditions does not qualify to get a marijuana license in Michigan:

The applicant has been charged with or released from prison for a felony under Michigan laws, other state laws, or the United States laws within the past ten years. A person convicted of a controlled substance-related felony within the past ten years is also not eligible.
The applicant is an elected officer of a governmental unit in Michigan, another state, or the federal government. A member of or employee of a regulatory body of a governmental unit in Michigan, another state, or the federal government is also not eligible. Likewise, an employee of a governmental unit in Michigan cannot apply for a marijuana license.
The applicant has knowingly applied for a license under this Act that contains false information.
The applicant has been charged with a misdemeanor involving a controlled substance, theft, dishonesty, or fraud in any part of the U.S. or been found responsible for violating a local ordinance in any state involving a controlled substance that substantially corresponds to a misdemeanor in that state within the past five years.
The applicant cannot demonstrate the ability to maintain adequate premises liability and casualty insurance for its proposed marijuana business.

After completing the relevant prequalifications forms, applicants should submit them and all required documentation either by mail, in person, or online via the LARA's application portal. First-time users of the online application portal are required to register. Individuals or entities interested in submitting their prequalification forms and documentation to the CRA in person or via mail can do so at/to:

Department of Licencing and Regulatory Affairs

Cannabis Regulatory Agency

Licencing Division

P.O.Box 30205

Lansing, MI 48909

Phone: (517) 284-8599

Step 2 - License Qualification Stage

At the qualification stage of a medical grower license, applicant entities and sole proprietors that have identified a location for their proposed marijuana growing facility can file a Medical Marijuana Facility License Application Form and provide all required documentation in the form. The licensee must provide proof of commercial general liability insurance covering the premises liability not later than 60 days after a grower license is issued. At the qualification stage of a recreational grower license, an applicant must complete the Marijuana Establishment License Application Form and provide the required documentation listed on the form. Applicants will also be required to prepare and submit a business plan as a part of the required documentation at this stage. The business plan must be very detailed and should cover every factor that is required to meet standards. An ideal business plan for a proposed marijuana grower license must include, at the least, staffing, security, facility content, financial plans, required technology, and the plans for disposal of waste.

A prospective licensee must provide information on the location, with details regarding the municipality of the proposed growing facility and the class of grower license they intend to obtain. At this stage, the CRA vets the proposed facility and reviews the business specifications, municipality information, general employee information, and proof of financial responsibility. A physical marijuana growing facility must pass an inspection by the CRA within 60 days of submitting a complete qualification application. The CRA may deny a license application if a prospective licensee fails to pass the Agency's inspection within 60 days of the license qualification application submission. To avoid this, an applicant must find a municipality that has authorized marijuana facilities (especially for applicants seeking to obtain medical marijuana grower license). They must also ensure that the proposed property or the marijuana establishment is qualified for a marijuana facility under the chosen municipality's ordinances and zoning regulations.

Also, all the classes of marijuana growers, including excess marijuana growers, must pass a Bureau of Fire Services (BFS) inspection within 60 days of submitting their license qualification applications to the CRA. As with the CRA vetting, failure to pass a BFS inspection under 60 days of qualification application submission may prompt the CRA to deny an application. Once the application at this stage is approved, and the applicant has passed the BFS and CRA inspection, they can go ahead and pay the required licensing assessment fee. The MFA will issue an applicant an MMFLA or MRTMA marijuana license (whichever class was requested), and they can start operating legally in Michigan. The Michigan Department of Licensing and Regulatory Affairs provides the paper application instruction booklets for Medical Marijuana Facility Licensing and Adult-Use Establishment Licensing on its website.

How Much Do Marijuana Cultivation Licenses Cost in Michigan?

Under the Michigan Regulation and Taxation of Marijuana Act, an applicant for an adult-use marijuana grower license will pay a non-refundable application fee of $3,000 upon initial application (pre-qualification). Upon licensure, the CRA will assess an initial licensure fee which varies by license class. Under the MRTMA, the initial licensure fee for each category of the marijuana grower license in Michigan are:

Class A marijuana grower license - $1,200
Class B marijuana grower license - $6,000
Class C marijuana grower license - $24,000
Excess marijuana grower - $24,000

The licenses are valid for 1 year and must be renewed annual. The renewal fees for the different license types are:

Class A marijuana grower license - $1,200
Class B marijuana grower license - $6,000
Class C marijuana grower license - $24,000
Excess marijuana grower - $24,000

Under the Medical Marijuana Facilities Licencing Act (MMFLA), a $3,000 non-refundable application fee must be paid by an applicant before processing an application. The initial licensure and annual fees for medical marijuana grower licenses under the MMFLA in Michigan for the Fiscal Year 2024 (October 1, 2023, to September 30, 2024) are:

Class A marijuana grower license - $1,500
Class B marijuana grower license - $3,000
Class C marijuana grower license - $4,500

The Cannabis Regulatory Agency (CRA) determines whether a licensee is in the bottom, middle, or top tier in any fiscal year compared to other licensees for the type of license they hold.

Can Licensed Marijuana Cultivators Hold Other Cannabis Licenses in Michigan?

Yes. Michigan allows interested persons or entities to apply for and obtain more than one type of license. They can combine different license types to make their facility one big integrated company. For instance, a business entity or a person can hold a marijuana grower license and a marijuana processor license to enable them to grow and process marijuana in the same facility.