Michigan issues first license to sell recreational marijuana

Ann Arbor — The legal sale of recreational marijuana in Michigan could be just days away after state regulators issued on Tuesday the program's first licenses.

Inside a retailer's Ann Arbor store, Andrew Brisbo, director of Michigan's Marijuana Regulatory Agency, handed three licenses to the leaders of Exclusive Brands, which will be able grow, process and sell recreational marijuana.

The marijuana industry will now be able to begin breaking down stigmas that have been tied to smoking marijuana for decades, said Nick Warra, general manager of Exclusive Brands.

"It will be just like going to buy alcohol from the liquor store or chips from Walmart," Warra said while leaning on a glowing white counter top inside the Ann Arbor business. 

Michigan voters approved a ballot proposal to legalize the adult-use of recreational marijuana in November 2018. Since then, state regulators who were already implementing a medical marijuana licensing program began working on the recreational program.

But the expediting of recreational pot licenses comes as medical marijuana patients have worried about shortages in the product. 

Last week, those regulators announced that pot shop owners with an equivalent medical marijuana facility license would be able to transfer up to 50% of their product to use for recreational sales. That decision sped up the expected date of the first recreational sales to Dec. 1.

The decision applied to Exclusive Brands, which received its recreational licenses Tuesday and has had medical marijuana licenses since 2017. The business will likely begin selling recreational marijuana on Dec. 1, Warra said. The only reason for a delay, he said, would because of a statewide tracking system for marijuana.

"We will be ready to go Dec. 1 as an operation, and we’re going to work closely with our vendors to make that happen," Warra added.

While it's possible Dec. 1 will be the first day of recreational sales in Michigan, it may slide to Dec. 2. Dec. 1 is a Sunday that falls after the Thanksgiving holiday, and licensees have to ask state regulators before transferring medical marijuana product into the recreational market.

"It’s hard to know exactly when it’s going to happen at this point," said David Harns, a spokesman for the Marijuana Regulatory Agency.

Another unknown, Warra said, is how many people will show up to buy recreational marijuana on the first day of sales.

"It’s totally up in the air," he said. "We’re not sure whether we’re going to have five people day one or it’s going to be 2,000."

Some marijuana industry representatives have criticized the state's decision to allow medical marijuana to be transferred into the recreational market. Robin Schneider, executive director of the Michigan Cannabis Industry Association, has argued that there's already a limited supply of marijuana for medical patients and the transfers could drive up costs for patients.

"It’s going to be very harmful," she said last week.

But Warra said Exclusive Brands expects to have enough product for both medical and recreational buyers. That's because the business can grow, process and sell its own marijuana, he said. Independent retailers who don't have their own growing and processing operations are the ones that could feel a shortage, he added.

The transfers from the medical marijuana market will allow businesses to move product where the demand exists, Brisbo said.

In total, the Marijuana Regulatory Agency issued five licenses Tuesday. Other licenses went to Kalkaska-based Real Leaf Solutions, which received an event organizer license, and Ann Arbor-based PSI Labs, which got a safety compliance facility license.

Many more licenses will be issued in the "short term," said Brisbo, who added that there will be a "gradual" build=up of the industry in Michigan.

Standing with the new licensees on Tuesday, he said, "As you can see, we're moving quickly."

cmauger@detroitnews.com