Detroit awards 33 Recreational Marijuana licenses after yearlong legal battle
The city of Detroit on Thursday announced it had awarded recreational marijuana licenses to 33 companies, capping a yearslong legal battle about who gets to sell adult-use cannabis in the city.
"It was a very, very, very challenging journey to get to this point," said City Council President Pro Tem James Tate.
He said it was important for the city that those who have "historically been prosecuted" for marijuana possession be able to benefit from the legal sale of cannabis in Detroit. To that end, the city has been pushing for long-time Detroiters to have a leg up in the application process. The result is a two-track application program, one for social equity applicants and one for non-equity applicants.
The social equity licenses are designed to ensure populations that were disproportionately targeted by marijuana arrests can benefit from the legalization of cannabis in the state. To qualify as an equity applicant, an applicant must be a qualified resident of Detroit or another community determined to be disproportionately impacted by the historical prohibition on marijuana and where at least 20 percent of residents live below the federal poverty level. A business that is at least 51 percent owned by such a person can also qualify as a social equity applicant.
Deputy Mayor Todd Bettison described it as an "early Christmas" for the "deserving applicants."
"It's been a long, four-year journey, fraught with false starts and legal challenges, but we made it," he said. "This is a celebration."
There were 90 applications for dispensaries, "micro facilities" that grow up to 100 plants and consumption lounges in the first of three rounds of applications. The city did not award any micro facility or consumption licenses to the seven equity applicants in those categories because no one met all the criteria for approval; there were no non-equity applications.
Of the 33 equity applicants for dispensary licenses, 20 were approved; there were 50 non-equity dispensary applicants and 13 were awarded licenses.
In a statement, the city said its ordinance allowed for 20 licenses apiece for dispensaries in the equity and non-equity categories in the first round of applications. In the equity category, the 20 companies with the highest totals after a third-party review were granted licenses. In the non-equity category, the 13 with the highest totals received licenses.
The next 20 companies all received the same score, but no more licenses were issued in the category because they did not qualify for a lottery selection under the ordinance.
In emotional statements, several new awardees recounted the effort it took to get approval. They said they hoped Detroit could be an example for the nation in terms of creating equitable opportunities for people who had been targeted by the war on drugs.
"This is a long time coming," said Kimberly Scott, the owner of Chronic City. "I fought tooth and nail so Black folks could benefit from this industry."
She said she was overjoyed that residents will be able to buy in their own neighbourhoods, helping to grow Detroit. Others recounted relatives' marijuana-related brushes with the law to describe the importance of social equity in determining who would profit from the business going forward.
"Today is why we fight," Tate said. "We don't want to go with the flow in Detroit, we want to make sure we're doing the right thing."
He added that the continued delays served to ensure Black residents were able to build partnerships and get resources to succeed in their applications.
"Every opportunity, folks took advantage of," he said. "They took the necessary steps to grow and learn."
The approvals came after a federal judge, Bernard Friedman, denied a request to further delay the distribution of the licenses, Tate said. He said the city will continue to fight lawsuits as they are filed.
"We're not walking away, we're not running away," he said.
The city of Detroit received 90 applications for adult-use marijuana dispensaries, "micro facilities" that grow up to 100 plants and consumption lounges in the first of three rounds of applications.
In its statement, the city said cannabis is expected to be a $3 billion industry in Michigan by 2024. In Detroit, the process has been delayed by legal challenges including two that followed City Council's April approval of an adult-use ordinance that had been modified because of other legal challenges.
In late July, Circuit Court Judge Leslie Kim Smith approved a temporary restraining order on an application process that was due to start Aug. 1. JARS Cannabis, which operates two medical marijuana dispensaries in the city, and District 7 LLC challenged the city's plans.</p>
In her ruling lifting the restraining order and allowing the process to begin, Smith wrote, "Although the city's 2022 marijuana ordinance is a complicated scheme, it is unambiguous and provides a fair licensing process, which comports with the mandates of the MRTMA (Michigan Regulation and Taxation of Marihuana Act).
Tate and others referenced that ruling in thanking Friedman for not continuing to delay the process. Still, Tate said he expects litigation to continue. Corporation Counsel Conrad Mallett said the city was "not going to be intimidated" by the number or frequency of lawsuits.
There will be two more, said Anthony Zander, the director of the Department of Civil Rights, Inclusion & Opportunity. In the end, the city expects to issue 160 licenses. He said round two is expected to begin at the end of January.
Kim James, director of the city's office of marijuana ventures and entrepreneurship, said she is open to personal meetings with applicants who were not chosen to explain their scores. Additionally, online info sessions will be available.
