Ypsilanti Implements Cap to Prevent Cannabis Market Oversaturation

May 16th, 2024 Legislation & Policy Updates
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Ypsilanti leaders have officially set a cap on the number of cannabis retailers in the city at 14. This decision was finalized with a 6-1 vote by the Ypsilanti City Council on Tuesday, May 14th. The sole dissenting vote came from Ward 1 Council Member Me'Chelle King.

The new ordinance follows a series of temporary measures aimed at curbing the influx of new cannabis dispensaries in the city. Existing cannabis business owners and members of the city's planning commission had advocated for a hard cap, expressing concerns that the market was becoming oversaturated.

Initially, the cap was set to be 13, but it was increased to 14 during the council's May 14th meeting due to a new application for a permit submitted before the restrictive measures took effect. City Manager Andrew Hellenga noted that denying this application could potentially expose the city to litigation, as the applicant complied with existing regulations when they applied. However, if this application is ultimately denied, the cap will revert to 13 under the new ordinance.

Previously, Ypsilanti had imposed a hard cap on the number of cannabis businesses allowed. This restriction was lifted partly to avoid legal challenges related to the allocation of limited permits. At the council's April 2nd meeting, City Attorney John Barr stated that the situation had evolved sufficiently to justify reinstating the cap.

In the interim, the council implemented zoning changes to reduce the number of available locations for new cannabis retailers and imposed an emergency moratorium on additional permits while deliberating on the appropriate cap level.

Concerns about market oversaturation were highlighted by Javier Valdez, owner of Depot Town Cannabis, who stated at the April 2nd meeting that continued market saturation might force him to close his business. Former council member and current Washtenaw County Commissioner Annie Sommerville also voiced worries that large cannabis enterprises were negatively impacting smaller, local businesses.

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