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The seasoned lawyers and litigators at The Rubinstein Law Firm are here to share their insights with you.

Recreational marijuana businesses are legal, but most cities won’t allow them

When Michigan voters approved the legalization of recreational marijuana businesses, it opened the door for local entrepreneurs looking to take advantage of the expected multibillion-dollar industry. Yet despite the statewide assent, many of Michigan’s municipalities have chosen to slam that door shut.

Under state law, municipalities can opt to bar recreational marijuana businesses from operating within their community. Right now, many have chosen that path.

According to a report from the Detroit Metro Times, there are 1,773 cities, townships and villages in the state. Of those, nearly 1,400 – that’s 79% – have voted to prohibit recreational marijuana businesses from opening there.

Entrepreneurs in a state of limbo

Some of these municipalities made the decision to ban recreational marijuana long ago, giving cannabis entrepreneurs time to adjust. Others, however, were less proactive. That includes Michigan’s largest city, Detroit, which passed a ban on Nov. 5 – five days after the state’s license application period opened.

That means there are people who made plans to open a recreational marijuana business in Detroit and applied with the state, only for the city council to then enact a ban and stop the project dead in its tracks.

It’s important to keep in mind, these local bans don’t have to be permanent. Many municipalities have said they will look into undoing them later. That includes in Detroit, where city council members say they need time to create local rules governing recreational marijuana before allowing its sale. That isn’t expected to happen until Jan. 31, 2020, at the earliest.

Residents can also try to override municipal prohibitions through the use of petitions and a ballot. Early attempts have been unsuccessful.

The impact on business operators

What does all this mean for prospective cannabis business operators? You’re going to need to do your homework. In addition to the tangled web of state rules that need to be followed, you’ll need to make sure the city, township or village in which you want to open a business hasn’t imposed a ban.

In addition, municipalities that allow for recreational marijuana sales may have their own specific regulations that need to be followed. That may include in places such as Ann Arbor, Ypsilanti and Ferndale – all cities the Metro Times projects as “hubs” for recreational marijuana businesses.