The Long Road to Cannabis Revenue in Ortonville, Michigan

March 16th, 2024 Legislation & Policy Updates
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In Ortonville, Michigan, a cannabis ordinance passed by a slim margin in August 2022 has yet to deliver significant financial returns to the community. The initiative, driven by Ortonville Residents for Action, received a green light with a vote tally of 221 to 216, permitting recreational cannabis enterprises within the village limits. Despite this approval, tangible benefits in terms of revenue have been scant.

Village Manager Ryan Madis reported that six applications were lodged for the two available licenses to operate cannabis businesses in Ortonville, with the village accruing only the application fees as revenue thus far. Each application carried a fee of $5,000, summing up to $30,000 collected from the 2022 submissions. Additionally, in 2023, the village garnered another $10,000 from applications for two licenses that had been conditionally approved the previous year.

The licenses were granted to an entity working alongside Canna Zoned, a real estate firm that assists in navigating the real estate and licensing process for cannabis businesses. However, the identity of the license owner has not been disclosed. Despite this progress, the timeline for the inauguration of retail establishments remains uncertain. Madis expressed concerns over the delayed realization of anticipated benefits, highlighting the village's ongoing wait to witness the promised economic uplift.

The potential financial advantage for Ortonville could exceed $300,000, considering the state Marijuana Regulation Fund's disbursement payments, which amounted to $118,172 for two licenses in 2023. Additionally, the license owner pledged $200,000 to the village as part of the state-mandated community benefits clause within the application process. Such community benefits are integral to the licensing applications, with proposals ranging from volunteer services by employees to infrastructural enhancements like the construction of a splash park.

Ortonville finds itself sidelined from a significant pool of revenue, with the state collecting $87 million in excise taxes in 2023, disbursed among various municipalities. The prospects for Ortonville receiving a portion of this financial windfall seem distant, exacerbated by delays in the submission and approval of site plans for the proposed cannabis businesses. Initial plans for the establishments, to be located on adjacent plots at 456 and 490 S. Ortonville Road, were rejected, with revised proposals still under review by the village.

Canna Zoned's attorney, Joey Kejbou, detailed efforts to align the new site plans with existing zoning regulations, emphasizing comprehensive renovations and enhancements that would negate the need for variances. However, township and county approvals remain pending for these sites, further delaying their operational commencement.

Kejbou also shed light on the owner's extensive involvement in Michigan's cannabis industry, noting their ownership and conditional approval of several facilities across the state. Despite the absence of a definitive timeline for the project's completion, Kejbou assured the village of the owner's commitment to contributing positively to Ortonville's economy.

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