Michigan House OKs medical pot rules with wide support

LANSING — With wide bipartisan majorities, the Michigan House of Representatives passed bills Wednesday to regulate the production and sale of medical marijuana, in both smokable and non-smokable forms.

Another form of the legislation passed the House last year but stalled in the state Senate. The new legislation would subject medical marijuana sales to a 3% excise tax and the state's 6% sales tax. Another bill would allow for the sale of non-smokable forms of medical marijuana, like brownies or pot-infused oils.

And a third bill would track the medical marijuana from seed to sale. All three bills passed by large margins with 95 or more votes.

The bills would:

Let communities decide whether they want medical marijuana-related businesses in their communities.

Impose a 3% excise tax on medical marijuana businesses and the 6% sales tax on sales of medical marijuana.

Create five categories of regulated medical marijuana businesses: growers, processors, dispensaries, testing facilities and transporters. The state Licensing and Regulatory Affairs Department would establish licensing fees for each category.

Set up a seed-to-sale tracking system to monitor marijuana production and sales.

Legalize non-smokable forms of marijuana, such as cookies and candies.

Although most patient rights' advocates support the bill, other medical marijuana advocates had opposed it because of the taxes imposed on the product — which started out as an 8% excise tax, but was dropped to 3% during negotiations on the bill Tuesday in the House of Representatives.

The final product got the support of the Michigan Cannabis Development Association.

"“By passing this landmark legislation, the Michigan House today is taking a historic step toward better protecting medical marijuana patients and providing local businesses and communities with a clear, consistent framework to make sure everyone across Michigan plays by the rules,” said Willie Rochon, MCDA secretary.

During testimony on the bills last month, state Rep. Jeff Irwin, D-Ann Arbor, said other forms of medicine aren't taxed by the state and medical marijuana shouldn't be either. But he said Wednesday that the bills were a fair compromise.

"I find the solution to be imperfect, but a good compromise," he said. "I hope the Legislature will ensure that this evolving market is something that we continue to get right."

State Rep. Mike Callton, R-Nashville, began working on the bills four years ago and said Wednesday that he thinks the rewritten legislation will face a friendlier Senate this time around.

"This year, we have addressed what made it stall last year," he said, noting police threw up significant opposition at the last minute, but have been more involved with the revamped legislation. "They've been at the table. They realize we need something."

State Rep. Lisa Lyons, R-Alto, sponsored the bill that legalizes non-smokable forms of medical pot, and said the issue is a moral one.

"The issue isn't whether you support medical marijuana. It's provided for in our state constitution," she said. "But we need to ensure safe access to medical marijuana and give people alternative forms from smoking, especially children and the elderly. There have been inconsistent judicial rules on other forms of marijuana and we've seen actual prosecution of people because they were using a form of medical marijuana that is healthier than smoking it."

House Minority Leader Tim Greimel, D-Auburn Hills," was one of only 11 lawmakers who voted against the main bill, which sets up the regulations on medical marijuana.

"I'm very concerned about taxing medicinal products," he said.

Supporters of the legislation have said the taxes are needed to cover the cost if implementing the bill and monitoring the growing and sales of the medical pot. If marijuana is legalized in the state, as several groups are gathering petition signatures to get the issue on the ballot in 2016, the excise tax will go away.

The bills — HB 4209, 4210 and 4827 — now move to the Senate for consideration..

Contact Kathleen Gray: 517-372-8661, kgray99@freepress.com or on Twitter @michpoligal.