In a nutshell:

  • Michigan Legislature has until June 5 to decide whether to approve citizen initiative to legalize pot for those 21 years and older.
  • If the legislature does not act, it will go to the November ballot where public opinion suggests voters will approve it.
  • Legislative approval would allow lawmakers to amend the initiative with a simple majority vote, as opposed to a three-fourths vote if voters approve it; the law almost certainly will require amendments to enable its implementation.

To adopt or not to adopt? That is the question currently before the Michigan Legislature regarding a citizen-initiated law to regulate and tax marijuana for non-medical purposes. The legislature has until June 5 to adopt the legislation, otherwise it will go before the voters at the November general election where it is likely to pass based on recent public opinion polling.

Given Michigan’s legislative experience with other highly-regulated and complex industries authorized via initiated laws – casino gambling and medical marijuana – amendments to the marijuana proposal are almost guaranteed to be necessary before the industry gets up and running. In its current deliberations regarding adoption of the marijuana proposal, the legislature should give consideration to the need, ease and speed related to adopting potential future amendments.

The Constitutional power of the grassroots

The Michigan Constitution (Article II, Section 9) provides for indirect initiative: once a sufficient number of valid signatures have been collected (currently 252,523), the issue goes to the legislature, and if approved within 40 days, the proposal becomes law without a vote of the people or approval by the governor. If the legislature does not act on the legislation, the proposal is submitted to the people.

Amending/repealing an initiated law requires a different vote threshold depending on whether it is approved by the legislature or voters. Proposals approved by the legislature only require a simple majority vote to change the law. Initiated laws approved by voters, however, require a three-quarters vote of the House and Senate to approve subsequent amendments.

Casino gambling and medicinal marijuana

Why is this significant? Because initiative measures approved by voters often have errors, flaws, or unintended consequences, requiring subsequent legislative modification. Additionally, numerous and significant changes to citizen-initiated legislation are often required to properly implement the will of the voters. Whether the change is to correct an error or to provide smooth implementation, amending an initiative can require substantial time to gather the necessary consensus among lawmakers. In Michigan, this can take even longer because of the legislative super-majority vote requirement associated with amending such laws.

Case in point: In 1996, Michigan voters approved a statutory initiative to establish the Michigan Gaming Control and Revenue Act to provide casino gaming operations in Detroit. This law showcased one of the oft-heard criticisms surrounding citizen initiatives in general, that of voters being presented with highly technical and complex policy matters.

Issues placed directly before the voters do not have the benefit of a legislative balancing of competing policy interests and needs. This was the case with the casino law. It required extensive amendment (with many of the original provisions repealed) before the three Detroit casinos could begin operating. The amended law provided for more stringent licensing criteria, substantially strengthened the licensing and regulatory authority of the state, and provided for a system for collecting wagering taxes. The original law approved by voters in 1996 was less than 10 pages long. However, following the 1997 amendments, the statute stands at 72 pages with 189 pages of administrative rules. All amendments to the casino law required three-fourths vote approval in the House and Senate.

In the November 2008 general election, voters approved the Michigan Medical Marihuana Act, a citizen-initiated law to allow for the use of medical marijuana under state law. This law, like the casino law 10 years prior, also required substantial legislative amendments. However, before the Legislature settled on a final framework to license, regulate and tax the medical marijuana industry in 2016, the law was allowed to take effect and the industry began to take root. However, it did so with many questions unanswered.

One issue not dealt with in the original legislation was dispensaries/provisioning centers; these businesses operated within a very gray area of the law. As these businesses began to proliferate across the state (in Detroit, Lansing, Ypsilanti and elsewhere), local government officials and law enforcement were left scratching their heads about a whole host of issues (zoning, public safety) that were unaddressed by the poorly conceived and written law. Without any central guidance offered through the statewide law, local communities were left to their own. Not surprisingly, many of the unanswered questions were at the center of various court challenges.

In one case, the Michigan Court of Appeals zeroed in on the challenges created when complex and technical lawmaking is left to the voting public – “The problem…is that the MMMA is inartfully drafted and, unfortunately, has created much confusion regarding the circumstances under which an individual may use marijuana without fear of prosecution. Some sections of the MMMA are in conflict with others, and many provisions in the MMMA are in conflict with other statutes, especially the Public Health Code.” (People v Redden)

In 2016, the legislature made much-needed comprehensive amendments to address many of the unanswered questions arising from the original law. While the task of balancing competing policy interests was certainly a challenge for the lawmakers over the intervening eight years, the three-fourths super-majority vote requirement likely added to the time required to get consensus on changes to the original medical marijuana law was approved by voters.

Legalized adult-use marijuana

Currently before the Michigan Legislature is a citizen-proposed law to license, regulate and tax the use of marijuana by adults 21 years and older. Time is growing short for the legislature to act, with a June 5 deadline only days away. While many individual lawmakers are generally opposed to legal pot and likely would not support legislation that originates from the Michigan Legislature, many suspect that the citizen-proposed law will likely pass with or without their support. This is because public opinion is generally supportive and growing.

The calculus that lawmakers are now dealing with is whether to approve the measure and then amend it to meet any particular defects they see in the proposed law. Because passage in November is believed to be likely, lawmakers have an opportunity to approve the law and subsequently make changes with a simple majority vote in the House and Senate (with governor’s approval), a much easier task than meeting the three-fourths vote threshold required if they want to amend it after voters approve it at the ballot box.

Given Michigan’s history with the creation of workable licensing, regulatory, and taxation systems for the casino gaming and medical marijuana industries, future amendments to the marijuana legislation are foreseeable.

What areas of the proposal might the legislature wish to change? Some have suggested that merging the medical and adult-use marijuana regulatory and taxation structures would be a place to start. Under the 2016 changes to the medical marijuana law, licensing is handled by a five-member board appointed by the governor. Under the adult-use marijuana proposal, regulatory responsibilities fall to a state department (Licensing and Regulatory Affairs).

With respect to taxation, medical marijuana is currently subject to a three percent excise tax (along with the six percent sales tax). Under the current proposal, non-medical pot would be taxed at 10 percent and also subject to the state sales tax. The allocation of the tax resources collected under each scheme are different and could be reconciled through future amendments. Either changing the tax rate or how the funds are distributed could be accomplished via a simple majority vote of the legislature if it decides to adopt the citizen initiative to legalize adult-use pot.

Many policymakers may see this issue as a true dilemma, i.e., a choice between two equally undesirable outcomes. It’s easy to sympathize. However, all polling suggests ignoring it will not make it go away. Time is drawing very short for a decision. Acting now paves the way for making it easier, at least procedurally, to change the law in the future.

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