At the recent Michigan Cannabis Regulatory Agency (CRA) public meeting on June 13th, several significant developments and concerns were discussed. These range from budget approvals and enforcement measures to public comments on various issues affecting the cannabis industry.
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Michigan's House, Senate, and Governor's office have largely agreed to the CRA's budget requests. A notable development includes the establishment of a reference laboratory, which will fall under CRA authority. This lab will play a critical role in enforcement cases, lab testing audits, and the creation of better standards and practices within the cannabis industry.
The meeting highlighted contrasting sales trends in the cannabis market. Recreational sales have reached an all-time high over the past three months, while medical cannabis sales are at their lowest levels historically. The state currently has 7,700 registered caregivers.
The CRA has bolstered its enforcement capabilities with 15 full-time agents who manage 150-200 complaints monthly. Between March and May, the agency conducted 956 inspections across 748 businesses. Additionally, there are 239 active social equity license operators in the state.
The public comment section of the meeting featured a diverse array of viewpoints from industry stakeholders and community members:
Aspergillus Testing: Josh Smith, representing Therapeutic Health Choice, argued against mandatory Aspergillus testing for recreational cannabis, referencing his experience in Oregon. He contended that while medical cannabis might benefit from such testing, recreational cannabis does not require it due to naturally occurring spore levels in the environment.
Transportation and Compliance: Lindsay Fen, representing Emerald Secure Transportation, raised concerns about arbitrary time limits and rejections, which could potentially disrupt their operations.
Fines and Enforcement: Eric Colandrea, counsel for LaHaze Grow in Cheboygan, expressed frustration over a $6,000 fine for failing to test employee samples, highlighting the financial strain such fines impose on smaller businesses.
Organic Standards: A caregiver named Theo Gantos advocated for certified organic standards for cannabis, suggesting that Michigan could lead in this area under CRA guidance.
Market and Enforcement Issues: William McKenzie, CEO of Heritage Farms, discussed market cycles and the impact of out-of-state conversion oil on prices. He claimed that a significant portion of the market is affected by illicit oil and called for stronger enforcement measures.
Conversion Oils and Safety: Several commenters, including representatives from DSP Machine, a cannabis attorney named Nicholas Galindez, and Josh Swaider from Infinite Analysis Labs, emphasized the dangers of conversion oils. They noted that these oils, often produced out-of-state, compromise consumer safety and called for stricter enforcement and testing.
Local Government Corruption: Liz Bennett from Penn Township accused local officials of corruption in the cannabis industry, suggesting that the state should oversee the collection of taxes and license fees to prevent malfeasance.
License Fees: A small-time operator from Northern Michigan, Kelly Young, requested a reduction in renewal fees, criticizing the state for enabling larger out-of-state investors to dominate the market at the expense of small local operators.
Testing and Fraud: Marco Troami, a consultant specializing in cannabis lab setups, highlighted the issue of hemp conversion oils and testing fraud. He advocated for the development of tests to distinguish genuine cannabis oil from synthetic compounds and suggested implementing a secret shopper program to audit lab results and restore confidence in the regulatory system.
The meeting underscored the complexity of managing Michigan's growing cannabis industry. From improving lab standards and enforcement to addressing market dynamics and ensuring safety, the CRA faces numerous challenges. However, the collaborative efforts between state authorities and industry stakeholders aim to create a more robust and reliable cannabis market in Michigan.
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