Lansing council OKs cap on marijuana dispensaries

A proposed cap of 48 medical marijuana dispensaries within Lansing city limits will stand. A divided City Council approved the issue 5-3 Monday. Council members Eric Hewitt, Brian Jeffries and Carol Wood dissented. Application fees of $1,000 also were adopted, as was a $75 charge for each background check in addition to the main applicant. Approval of the cap and fee schedule completes an ordinance regulating Lansing’s emerging medical marijuana industry. City leaders had recognized 48 dispensaries as operating before a moratorium on business licenses was enacted in December.

The moratorium ended July 1, but no new licenses were to be granted until council adopted the final pieces of its policy. Dispensary owners, who had until the end of last week to file a preliminary application, now can finalize their requests.
Maintaining a cap of 48 means none of the original businesses will be forced to close. Some likely will have to move by next year if they don’t meet requirements to stay 1,000 feet from schools, churches and other dispensaries in industrial and commercial zones.

Prior to approving the proposal, as moved last week from the council’s public safety committee, council members shot down two other motions for a lower cap – one at 40 and another that would start at 40 and roll the number back each year until it reached one for every 10,000 city residents, or about 11 or 12.

Concerns about whether the number is too high will be resolved naturally under the laws of economics, council Vice President Kathie Dunbar said. “If they don’t have a customer base, they’ll close,” Dunbar said. “I feel like the market is going to take care of itself on this one, and probably sooner rather than later.” She refuted arguments by some residents and council members that allowing a higher number will make Lansing the destination for medical marijuana in mid-Michigan, saying she didn’t believe council should “segregate” businesses based on the goods they sold.

“If it were any other product people were flocking to Lansing to buy, we would be thrilled,” she said. But Hewitt, who represents the east side in the 1st Ward, said his main priority is providing the service to and protecting Lansing’s residents. He said allowing up to 48 dispensaries could draw customers from outside Lansing. “We may end up with an unintended consequence that we’re not even prepared for at this point,” he said.

City Attorney Brig Smith has said setting the maximum at 48 would be the most legally sound option. Thirty-three dispensaries submitted preliminary applications to the city by last week’s deadline, Clerk Chris Swope said. Another two filed paperwork Monday. Most, but not all, were part of the original group of 48. Swope said it is unclear whether some opened during the moratorium or moved after they submitted an address to the city.

All of the applications have yet to be vetted, Smith said. But regardless, there will be room for new applicants up to the maximum of 48. Residents, many from Lansing’s east side who were concerned about clustering in their neighborhoods, wanted to see the maximum set much lower. They supported a proposal from Melissa Quon Huber, president of the Averill Woods Neighborhood Association, to cap dispensaries at 16 or 24 and divide them evenly among the city’s four wards.

Joan Nelson, director of the Allen Neighborhood Center, said areas around Michigan Avenue have been a “pilot” run of what can happen under the state’s medical marijuana law, approved by voters in 2008. Dispensaries still will be able to meet residents’ medical needs under a smaller cap, she said, and they should be spread evenly to avoid clustering in any one area.

“We think that that’s only fair,” Nelson said. No dispensary owners spoke on behalf of their businesses prior to the cap being adopted Monday. Both the fee schedule and the cap will be reviewed in a year.

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