Correction: A previous version of this article stated Lansing had dismissed its lawsuit against the state. City officials said Lansing was "willing to stipulate dismissal." Additionally, a previous version included an incorrect street address for Kin dispensary.

LANSING — Ten dispensaries now have conditional local approval to sell medical marijuana to patients in Lansing.

Those dispensaries will create 1,444 jobs and collectively invest $51.5 million in Lansing, City Clerk Chris Swope said, referring to information included in the applicants' business plans.

The licenses issued by the city Tuesday will be considered temporary until the dispensaries obtain approval from the state. The businesses also will need certification from Lansing's Building Safety Department.

City will consider dismissing lawsuit

Also on Tuesday, the city indicated it would consider dropping its lawsuit against Michigan regulators over a state-imposed shutdown deadline for medical marijuana businesses that are operating without temporary local approval.

Lansing was among the plaintiffs to file suit in November after Michigan Department of Licensing and Regulatory Affairs announced it would begin shutting down dispensaries with pending state applications if those dispensaries lacked local approval by Oct. 31.

The Oct. 31 deadline provoked outcry from city officials, because, until Tuesday, Lansing had not yet issued any preliminary licenses to dispensaries, which are also called provisioning centers.

City officials said they were "willing to stipulate dismissal" of the lawsuit because LARA agreed not to take enforcement action against Lansing dispensaries without local approval until Dec. 31.

11 months to grant dispensary licenses

Lansing City Council first approved a medical marijuana licensing system in September 2017, but the process of actually issuing licenses has been beset by litigation.

In all, it took the city more than 11 months to issue its first dispensary licenses.

Eighty-five applicants had asked to open dispensaries by the time the city's first round of licensing applications closed in December 2017.

The City Council's 2017 medical marijuana ordinance empowers the city clerk to grant up to 20 dispensary permits during an initial round of licensing. Five more dispensary licenses could be granted during a second licensing period — those applications will be accepted beginning Feb. 13.

City changes its tune on effect of appeals

So far, the city has denied 38 dispensary applications, although 19 of those applicants can still appeal their denials through the city.

In the past, city officials have blamed the delay in granting applications on the ongoing appeals process.

Per ordinance, Lansing must grant its first round of approvals to the 20 dispensaries that score the highest under the city's detailed evaluation system.

Since an appeal could result in altered score, Swope has previously said it would be impossible to select the 20 highest scorers until all applicants have exhausted their appeals process.

Swope and other city officials cited a civil case involving Seman Consulting Services, LLC., which sued the city over "capricious" denial of its dispensary license. Ingham County Circuit Court Judge James Jamo dismissed the lawsuit in October, but city officials said that, under a court order issued earlier in the case, it would be a due-process violation to issue licenses to other applicants while appeals were ongoing.

This week, however, city leaders offered a different interpretation.

"I decided to take another look at the order," Swope said Tuesday.

Asked if the city might be sued for granting licenses before the appeals process concluded, Swope acknowledged that "lawsuits are always a potential reality" but said the need to ensure patient access was a factor in the decision to issue 10 licenses.

City Attorney Jim Smiertka said his office "thoroughly analyzed" the legality of issuing licenses, "including 'what if' scenarios." He declined to comment further on the city's decision, citing multiple pending lawsuits against Lansing over marijuana licensing.

Lansing Mayor Andy Schor said the issuance of some licenses Tuesday would likely not interfere with the appeals process because the city only granted approvals to the top 10 scorers. Appeals are more likely to impact close calls among the scorers at the bottom of the bracket, Schor said.

"We were criticized for not issuing any licenses," prior to November, Schor said. "Issuing some but not all of the licenses allows enough space for those people in appeals to get their due process."

Marijuana money

Although Lansing's medical marijuana ordinance limits the number of dispensaries that can operate citywide to 25, it does not set a cap on other types of marijuana businesses, which are safety-compliance labs, transporters, growers and processors. The city began issuing licenses to those types of businesses earlier this year.

It costs $5,000 to apply to Lansing for a medical marijuana business license. Licenses must be renewed annually. If a license is denied, the city will refund half the application fee.

Along with fees, taxes are expected to bring Lansing some revenue from medical marijuana. Municipalities that allow medical marijuana businesses in their communities will collect 25% of the state's excise tax on the drug.

So far, Lansing has paid an outside firm called ICF Consulting more than $82,000 to help score dispensary applications, invoices show.

More:

Judge stops Halloween shutdown for marijuana businesses

Medical marijuana facility gets state approval to grow up to 3,000 plants in Lansing

Contact Sarah Lehr at (517) 377-1056 or slehr@lsj.com. Follow her on Twitter @SarahGLehr.

Which dispensaries got licenses?

The following dispensaries have preliminary city approval to operate in Lansing.