Detroit okays 75 retail marijuana shops; half will go to legacy residents

The city of Detroit cleared the way for the opening of adult-use marijuana stores on Tuesday—and like many cities, it’s still wrestling with how many licenses to set aside for locals.

The city council of Michigan’s largest city unanimously passed the much-anticipated ordinance with the caveat that half of all licenses be issue to legacy residents. The idea, of course, is to level the playing field for small, longtime Detroit residents and entrepreneurs to take part in an estimated $3 billion market.

Councilman James Tate spearheaded the push for the new law. “Not only will this give Detroiters an in-road into the business,” Tate said, according to Crain’s Detroit Business, “it should ensure they have some success.”

Two years in the works

The need to prioritize local merchants became clear as the city developed the law, a process that began two years ago when Michigan voters approved the statewide legalization of recreational cannabis.

“We’ve seen around the country where individuals who live in the municipality where the industry is located are frozen out and not having an opportunity to participate,” Tate told the Detroit News. 

Other provisions for locals include discounts on the purchase of land and the number of licenses issued. Not surprisingly, the law had the support of an array of city residents—some of whom already own medical marijuana businesses—who weighed in at a virtual public hearing.

“I and many other Detroiters have sacrificed so much to see the day that brings generational wealth to our children through legal cannabis businesses,” Mitzi Ruddock said, according to the News. Ruddock, a single mother from Detroit with a past marijuana conviction, runs Black Cannabis Access, an organization intended to address economic disparities in cities.

“This isn’t a game nor has it ever been a side hustle for us,” she said. “Detroiter-owned companies will hire Detroit employees, which will support Detroit families and rebuild Detroit communities and contribute to Detroit income tax base.”

75 retail shops planned for Detroit

The new law, likely to go into effect in January 2021, encompasses 10 types of businesses, including grower, processor, designated consumption lounge, and safety compliance facility. Detroit plans to license 75 recreational-use retail shops.

It provides special provides for “Detroit Legacy” businesses, open to applicants who have lived in the city for 15 of the past 30 years; resided in Detroit for 13 of the past 30 years and are low income; or 10 of the past 30 and have a past marijuana conviction. The licensing process will freeze if the approval process brings the percentage of Detroit-owned licenses below 50%.

The city learned the hard way to clear the way for home cooking. Of Detroit’s 46 medical dispensaries, only four are owned and operated by Detroit residents, according to Mayor Mike Duggan.