Medical Pot Amendments May Yield Vote

Ann Arbor council to continue work on licensing

Ann Arbor city council meeting (March 7, 2011) Part 2: At its first meeting in March, the city council undertook extensive amendments to a licensing proposal for medical marijuana businesses that it began considering for the first time at its Dec. 6, 2010 meeting. However, at the early March meeting, the council ultimately decided to postpone again its initial vote on the licensing proposal, which will eventually require two votes by the council, if it is to be enacted.

The city council will again take up the issue of licenses for medical marijuana businesses at its Monday, March 21 meeting.

Sabra Briere Ann Arbor city council raised hand to speak

Councilmember Sabra Briere (Ward 1) raised her hand and waited to be acknowledged by the mayor before speaking at the March 7, 2011 council meeting. (Photos by the writer.)

The council had previously heavily amended the licensing proposal at its Jan. 3, 2011 meeting as well as at its Feb. 7 meeting. The amendments made on March 7 put the council possibly in a position to make any final amendments, and to take its initial vote on the licensing proposal at its March 21 meeting. [.pdf of medical marijuana licensing proposal after March 7 amendments – "clean" version] [.pdf showing amendments undertaken at the March 7 meeting – "marked up" version]

Also at the March 21 meeting, the council is expected to extend the moratorium on use of property within the city for medical marijuana businesses – first enacted at the council’s Aug. 5, 2010 meeting. The initial moratorium was supposed to last only 120 days, but was subsequently extended at the council’s Nov. 15, 2010 meeting for another 60 days, and again at its Feb. 7, 2011 meeting an additional 60 days, until March 31, 2011. The council wants to coordinate the second and final vote on a medical marijuana zoning ordinance, which it passed initially on Oct. 18, 2010, with the vote on the licensing ordinance.

An additional medical-marijuana-related item, postponed from the March 7 meeting until March 21, is a proposal to enact a clear non-disclosure policy for information that the city might gather from people who have registered with the state of Michigan as medical marijuana patients and caregivers under Michigan’s voter-approved Michigan Medical Marijuana Act.

Part 1 of the March 7, 2011 city council meeting report – which deals with the non-medical marijuana issues on the agenda – was previously published as a separate article.

Medical Marijuana: Public Commentary

While the council has now heard extensive public commentary on medical marijuana from multiple people at more than half a dozen meetings, that commentary does not constitute a formal public hearing, which is required before the council takes a second and final vote on any ordinance. The council took its initial vote on a medical marijuana zoning ordinance in October 2010, but has yet to take its first vote on a licensing ordinance.

Ray Gould identified himself as a local resident, and a registered medical marijuana patient. He said that he was in the process of opening a medical marijuana dispensary when the council passed its moratorium. He reminded the council of the high percentage of Ann Arbor residents who had voted in favor of the Michigan Medical Marijuana Act. He told the council that currently 15 states allow use of medical marijuana in some form, and that 12 more states are considering similar legislation.

Gould cautioned that if the licensing rules require dispensaries to keep a list of suppliers, it would put a damper on suppliers. He suggested that a limit of 15 on the total number of licenses to be granted by the city is not enough, given the number of patients from outlying areas who might travel to Ann Arbor to get access to medical marijuana. He suggested that 25-30 licenses would be a better number. He pointed out that the moratorium was originally supposed to be in place for just 120 days [4 months], and now it’s been in place for nearly 8 months.

Dennis Hayes remarked that he was back for the fourth or fifth time. He pointed to the legislative intent of the MMMA, which is to enhance the ability of patients to get access to medical marijuana. He told the council that there have been several new developments. Gov. Rick Snyder had signed an executive order that transfers the Bureau of Health Professions from the Department of Community Health to the new Department of Licensing and Regulatory Affairs. This would transfer responsibility for processing applications for registered caregivers and patients, Hayes said, and the state is already 40,000 applications behind, so he didn’t think that this would improve things. It would likely not take just four months but rather six months for applications to be approved, he feared.

Hayes went on to describe a recent Michigan Court of Appeals ruling where the dissenting judge in the 2-1 ruling had argued that the MMMA should be used as a “shield” and not as a “sword.” [The case involved a man who was growing medical marijuana in a dog kennel, surrounded by a locked six-foot fence. The two judges in the majority ruled that this did not meet the MMMA requirement that medical marijuana be kept in "a closet, room, or other enclosed area equipped with locks or other security devices that permit access only by registered primary caregiver or registered qualifying patient."]

Hayes said that while the licensing requirements being considered by the Ann Arbor city council did not constitute a single large sword, they were a set of smaller swords.

Chuck Ream – who addressed the council over a year ago on the topic of medical marijuana, and has frequently addressed the council over the last four months – told them there was not much more to say. It’s time to “gitter done,” he said. He asked how cultivation facilities actually helped patients – he feared they would contribute to getting Ann Arbor’s whole program busted. As far as record-keeping goes, he said there can’t be a permanent list of all suppliers kept by dispensaries. If they keep it for 30 days, he said, that is sufficient.

Ream said that in addressing the city council, encouraging them to do the right thing with respect to the licensing ordinance, he felt a bit like the birds in the story of Peter Rabbit who exhorted Peter to exert himself, and when he did, he set himself free.

Mike McLeod introduced himself on behalf of the Green Planet Patient Collective. He asked the council to reconsider the definition of “cultivation facility” – he was concerned that the current definition would apply to just a single plant grown outside someone’s home. He said that the collective believes the state law gives rights to patients and caregivers to grow plants without the requirement that they be put on a list. The city’s zoning ordinance would be sufficient, he said.

Matthew Abel introduced himself as an attorney with Cannabis Counsel in Detroit. He echoed what Hayes and Ream had to say about privacy and record-keeping. He said there’s concern due to the fact that the federal government has subpoenaed records and may continue to do so. He advises his medical marijuana clients to keep the minimum amount of records needed to maintain the business. With respect to cultivation facilities, he said that if they’re operated properly, they’re unlikely to draw interest from police.

Abel said he was mostly concerned about the number of licenses that would be available. He reported that he had a number of clients who were interested in doing business in Ann Arbor, but who were not doing so, because they had waited – they were being cautious to make sure they would have city approval before going forward. Now, he said, with the city council’s apparent intent to grant licenses to existing businesses on a priority basis, those who were cautious are being punished. He suggested doubling the number of dispensaries allowed. He also noted that existing businesses are concentrated mostly on the west side and suggested a system that allocates a certain number to each of the city’s five wards might work to spread things out geographically.

Medical Marijuana Non-Disclosure Policy

Before the council was a resolution that would articulate specifically that the city has a non-disclosure policy about information that might be collected in the course of processing medical marijuana licensing applications or enforcing zoning regulations. The resolution was brought forward by Sabra Briere (Ward 1). Its “Resolved” clauses read:

RESOLVED, That the following information, if provided to the City as part of the zoning and/or licensing process for medical marijuana caregivers, dispensaries or other providers, shall be protected against public disclosure in the course of the zoning and licensing process: the name, address and date of birth of any qualifying patient; the name, address and date of birth of a qualifying patient’s primary caregiver; the name, address and telephone number of a qualifying patient’s physician; any designation as to whether a qualifying patient or primary caregiver will be allowed under state law to possess marijuana plants for a qualifying patient’s medical use; and the names or other identifying information of persons to whom the Department of Community Health has issued registry identification cards; and

RESOLVED, That the foregoing information shall be exempted from disclosure in response to Freedom of Information Act requests on privacy grounds and/or based on the provisions of Michigan Medical Marihuana Act, unless those grounds for exemption are ruled invalid by a court.

The relatively brief council discussion – which came after more than two hours of deliberations on the medical marijuana licensing scheme – included Briere, city attorney Stephen Postema, Christopher Taylor (Ward 3) and Tony Derezsinski (Ward 2). Background for their conversation are privacy clauses in two different statutes: (1) the Michigan Freedom of Information Act (FOIA), and (2) the Michigan Medical Marijuana Act (MMMA).

In broad strokes, the FOIA says that public bodies must produce information upon request. But certain exemptions apply. The two FOIA exemptions relevant to the council’s discussion include one that allows a public body to withhold information that would represent an unwarranted intrusion on someone’s privacy, and another that allows a public body to withhold information, if an exemption is provided by some other statute [emphasis added]:

15.243 Exemptions from disclosure
Sec. 13. (1) A public body may exempt from disclosure as a public record under this act any of the following:
(a) Information of a personal nature if public disclosure of the information would constitute a clearly unwarranted invasion of an individual’s privacy. …
(d) Records or information specifically described and exempted from disclosure by statute.

The operative verb is “may,” which means that while a public body can choose to withhold certain information, it is not required by the FOIA to withhold it. The attorney general’s outline of the FOIA statute affirms the withholding of information as optional: “A public body may (but is not required to) withhold from public disclosure certain categories of public records under the Freedom of Information Act.” The attorney general’s outline was last updated a decade ago, but the AG’s office confirmed for The Chronicle that the document is still accurate – in the intervening period, no changes have taken place in the statute or with case law.

The Michigan Medical Marijuana Act has an exemption on disclosure of certain patient and caregiver information, which means that the FOIA itself would allow, but not require, withholding of that information – both under Sec. 13. (1)(a) and Sec. 13. (1)(d). In fact, the MMMA specifically references the information as exempt under the FOIA. But the MMMA non-disclosure clause is not optional. Here’s the set of confidentiality rules in the MMMA [emphasis added]:

(h) The following confidentiality rules shall apply:

  1. Applications and supporting information submitted by qualifying patients, including information regarding their primary caregivers and physicians, are confidential.
  2. The department shall maintain a confidential list of the persons to whom the department has issued registry identification cards. Individual names and other identifying information on the list is confidential and is exempt from disclosure under the freedom of information act, 1976 PA 442, MCL 15.231 to 15.246.
  3. The department shall verify to law enforcement personnel whether a registry identification card is valid, without disclosing more information than is reasonably necessary to verify the authenticity of the registry identification card.
  4. A person, including an employee or official of the department or another state agency or local unit of government, who discloses confidential information in violation of this act is guilty of a misdemeanor, punishable by imprisonment for not more than 6 months, or a fine of not more than $1,000.00, or both. Notwithstanding this provision, department employees may notify law enforcement about falsified or fraudulent information submitted to the department.

The general sense among councilmembers who took part in the conversation seemed to be that the privacy concerns are important, that the resolution before them was essentially a reaffirmation of legal principles and city policies that are already in place, and that it would be best to wait and see the exact form that the city’s licensing and zoning regulations take before enacting such a policy.

Outcome: The council voted unanimously to postpone consideration of the non-disclosure resolution until its March 21, 2011 meeting.

Medical Marijuana Licensing: Council Deliberations

Councilmembers worked from more than a dozen sheets of amendments that had been provided by the city attorney’s office at the meeting. The sheets were color-coded to reflect various alternatives for some of the amendments. No extra copies were available for members of the audience to try to follow the council’s conversation. However, the amendments were each read aloud before they were discussed.

Ann Arbor city council meeting

At their March 7 meeting, councilmembers worked their way through more than a dozen pages of green and yellow highlighted amendments to the proposed medical marijuana ordinance.

Sabra Briere (Ward 1) led the council in a first pass through the amendments, but not in the order of the document – she’d identified some that she felt would be dispatched with relatively little discussion. After that initial pass, Sandi Smith (Ward 1) asked that the remaining amendments be considered in the order they appear in the ordinance.

This report is organized mostly along the lines of the chronology of the council’s deliberations. In some instances, the report consolidates discussion and votes on related amendments.

Generating the most discussion was an amendment related to how to track down information about the source of marijuana, in the event of a public health risk.

[.pdf of medical marijuana licensing proposal after March 7 amendments – "clean" version] [.pdf showing amendments undertaken at the March 7 meeting – "marked up" version]

MML Amendment: State or Local Law, not Federal

Sabra Briere (Ward 1) told her council colleagues that insertions of the phrase “state or local” in several places in the ordinance is meant to make clear that the ordinance would apply to state or local law, but not federal. Examples of the insertion are as follows.

6:420. Prohibited Acts.
It shall be unlawful for any person to: …
(b) Produce, distribute or possess more medical marijuana than allowed by any applicable state or local law.
(c) Produce, distribute or possess medical marijuana in violation of this chapter or any other applicable state or local law.

The ordinance as amended includes six instances of “state or local law.”

Outcome: The council voted unanimously to amend the ordinance by inserting “state or local” law.

MML Amendment: Punishments – Reasons for License Revocation

The council considered several separate amendments to the section of the ordinance dealing with reasons for revocation of a license. Subsection (7) was a new addition. Others were wording changes to existing subsections. In their amended form, the conditions for license revocation are as follows:

6:421. License Revocation.
A license issued under this chapter may be suspended or revoked for any of the following violations:

  1. Any person required to be named on the application of the license is convicted of or found responsible for violating any provision of this chapter;
  2. The application contains any misrepresentation or omission of any material fact, or false or misleading information, or the applicant has provided the City with any other false or misleading information related to the medical marijuana business;
  3. Any person required to be named on the application is convicted of a crime which, if it had occurred prior to submittal of the application, could have been cause for denial of the license application;
  4. Marijuana is dispensed on the business premises in violation of this chapter or any other applicable state or local law, rule or regulation;
  5. The cultivation facility or dispensary is operated or is operating in violation of the specifications of the license application, any conditions of approval by the City or any other applicable state or local law, rule or regulation.
  6. The City, or the County or the MDPH or any other governmental entity with jurisdiction, has closed the business temporarily or permanently or issued any sanction for failure to comply with health and safety provisions of this chapter or otherwise applicable to the business or any other applicable state or local law.
  7. The dispensary or cultivation facility is determined by the City to have become a public nuisance.

Mayor John Hieftje said that with respect to 6:421 (7), he was happy to see language appearing in the ordinance that would allow the city to act, if a medical marijuana business became a problem – not that he anticipated this would happen.

Stephen Kunselman (Ward 3) wanted to know what the difference is between being “convicted of” violating a law and being “found responsible” for violating a law. Assistant city attorney Kristen Larcom clarified that when you’re guilty of violating a criminal law, that is a conviction; when you violate a civil law, you are found responsible for violating it.

Kunselman wondered if 6:421(6) made sense, given that he understood that the state statute didn’t actually give any credence to dispensaries as businesses – how could the MDPH shut down a business that was not acknowledged to exist? City attorney Stephen Postema allowed that it was not possible to anticipate all of the changes that might take place in the future.

Also related to 6:421(6), Marcia Higgins (Ward 4) wondered what would happen if the state took action on the regulation of dispensaries, and Ann Arbor’s ordinance is different from the state law – would Ann Arbor have to conform with the state’s law? Postema said the city would need to be consistent with the state law, in whatever way it is eventually clarified – legislatively, or through court cases.

Outcome: The votes on the amendments to the section on reasons for license revocations were all unanimous.

MML Amendment: Punishments – Public Nuisance

In addition to serving as a possible reason for revocation of a license, the following amendment specified that being found to be a public nuisance could result in the usual range of penalties for being a nuisance:

6:422. Revocation Not Exclusive Penalty.
Nothing in this chapter shall be deemed to prohibit the city administrator or designee from imposing other penalties authorized by this code or other ordinance of the city, including filing a public nuisance action or any other legal action in a court of competent jurisdiction.

Outcome: The council voted unanimously, without deliberation, to add the filing of a public nuisance action to the set of punishments that could be applied to a medical marijuana business, beyond the revocation of its license.

MML Amendments: Privacy – Licensing Board Membership

Privacy issues generally prompted a lot of discussion by the council. One such issue came up with a proposed amendment that addressed the membership of the licensing board. In the version the council began with, the membership was defined as “one member of Council, one physician, one medical marijuana caregiver.” An amendment proposed by Sabra Briere (Ward 1) would have extended the membership as follows: “one member of Council, one physician, one medical marijuana caregiver, one medical marijuana patient, and one Ann Arbor resident.”

The amendment as eventual approved preserved the additional number of members but struck the requirement that there be two slots for people registered with the Michigan Department of Public Health – one as a patient and one as a caregiver. As approved, the amendment also added extensive material about the basis the board can use for awarding licenses:

6:415. License Required, Number of Licenses Available, Eligibility.

(7) The City Council will establish a licensing board to consist of one member of Council, one physician, and three other Ann Arbor residents, these are Mayoral appointments. The Board will annually review and recommend the licensing criteria, the number of licenses authorized, the license fee structure, and recommend approval of license applications.

While a cultivation facility or dispensary shall not be eligible for a license if any person required under this chapter to be named on the application has been convicted of a felony involving controlled substances, evidence that a person required under this chapter to be named on the application has been convicted of any other type of felony, under the law of Michigan, the United States, or another state, may be used by the Board in its determination of whether or not to recommend the issuance of a license to the applicant. Among other things, the Board shall consider whether the substance of the offense would tend to indicate a likelihood that the person would be unable to serve the public in a fair, honest and open manner or to dispense or cultivate medical marijuana in compliance with the MMMA, whether there is evidence that the person has been rehabilitated, and the age of the conviction.

In response to a question from Tony Derezinski (Ward 2), Briere clarified that the intent of the wording for the membership – specifying that one be a resident of Ann Arbor – was not meant to imply that the other members would not be residents of Ann Arbor. Mayor John Hieftje indicated that the city followed a policy that all board and commission appointments needed to be residents of Ann Arbor unless they had special skills or background, if supported by a super-majority of eight members of the city council.

Stephen Postema

City attorney Stephen Postema.

City attorney Stephen Postema suggested that inclusion of the word “other” in “one other Ann Arbor resident” would imply that the previous members in the list are also Ann Arbor residents.

The council entertained brief discussion about the annual nature of the review and whether the licensing board was just recommending approval of licenses. But the main focus of their conversation was the implications of serving on a board or commission for the people filling the proposed slots for a patient and a caregiver – board and commission members have their addresses made public as a routine part of the confirmation process.

Marcia Higgins (Ward 4) was first to raise the privacy issue. She wondered how the patient and caregiver members would have their information protected. Derezinski said people would serve with the knowledge that this information would be made public – it might dissuade some, but not most. Christopher Taylor (Ward 3) suggested that there is ample evidence that there’s a willingness for people to volunteer that information – the number of people who’d addressed the council by introducing themselves as patients and caregivers was evidence of that. Hieftje was concerned, nonetheless, that it could result in a very narrow pool of possible applicants.

Responding to Taylor’s point, Higgins noted that people speaking to the council did not disclose their addresses. She also stressed that this private information would be a part of the public record for a very long time.

The council opted to lump the two registered slots into a total of three members who would be at-large Ann Arbor residents.

Outcome: The council unanimously approved the amendment on licensing board membership.

MML Amendments: Coordination with General Licensing

The medical marijuana licensing scheme is proposed to be a separate chapter in the city of Ann Arbor code – Chapter 71. The city code already contains some general provisions for business licensing in Chapter 76, called “Licenses.”

An amendment to the general provisions part of the medical marijuana licensing code was intended to establish the relationship between the two chapters of the city code, in the event there is a conflict. Assistant city attorney Kristen Larcom indicated to the council that she had not been able to identify any conflicts between the two chapters. The following amendment was eventually withdrawn:

6:416. General Provisions.
(5) The provisions of Chapter 76 of this Code apply to this Chapter unless this Chapter establishes another procedure.

For his part, Christopher Taylor (Ward 3) saw the amendment as essentially a direction to an applicant for a license to have a look at Chapter 76 as well – that kind of direction could be provided on the application form, he said. In offering a rationale for including the language, Sabra Briere (Ward 1) said that there is material in Chapter 76 on general licensing that could be added to the medical marijuana licensing chapter – for example, the right to appeal –but that it would repeat the content of Chapter 76. The idea was to avoid redundancy, Briere said.

As it became clear that the reference to a different chapter of the code was required, because there was material in that chapter that potentially is relevant to medical marijuana licensing, Marcia Higgins (Ward 4) displayed some irritation with city attorney Stephen Postema. She saw the approach of separating general licensing from medical marijuana licenses as in conflict with the council direction to his office to simplify the city code wherever possible and to consolidate all relevant codes in the same place. She mentioned the Zoning Ordinance Reorganization project (ZORO) as a specific example of that goal to consolidate and eliminate redundancy.

Postema replied to Higgins by saying that it would have been possible to write the medical marijuana licensing into the existing Chapter 76 on licensing. However, he characterized the medical marijuana licensing as a unique kind of license, but that it would “bog down” the business licensing ordinance if it were included there.

In response to Postema’s characterization of the medical marijuana licensing as an “unusual” kind of license, Higgins told him she did not think it was “unusual” because the city council was looking to implement it and it had been voter-approved.

Outcome: The amendment referring to Chapter 76 was withdrawn.

MML Amendments: Wording of Title

An amendment receiving no comment or deliberations was a title change to the section on application requirements. As amended, the title reads:

[amended text] 6:417. Application Requirements for New Annual License or Renewal of Existing License; License Requirements for New License and for Renewed License

The amendment replaced the old title, which was:

[unamended text] 6:417. Application for and Issuance of New Annual License or Renewal of Existing License for Medical Marijuana Dispensaries and Medical Marijuana Cultivation Facilities.

Outcome: The amendment on the wording of the title was unanimously approved without discussion.

MML Amendments: Definitions

Definitions for “dispensary” and “cultivation facilities” were modified; a definition for MDCH was added:

6:414. Definitions.

(b) Medical marijuana cultivation facility means a structure or each space in a structure that is separately owned or leased by a person other than the owner of the structure, in which marijuana plants are being cultivated in compliance with the Michigan Medical Marijuana Act. For purposes of this chapter, a medical marijuana home occupation as defined in Chapter 55 (Zoning) is not considered to be a medical marijuana cultivation facility.
(c) Medical marijuana dispensary means one or more caregivers operating at a fixed location, in compliance with the Michigan Medical Marijuana Act, for the purpose of transferring marijuana at that location to one or more persons whose medical use of marijuana is protected under the Michigan Medical Marijuana Act. For purposes of this chapter, a medical marijuana home occupation as defined in Chapter 55 (Zoning) is not considered to be a medical marijuana dispensary.

(f) MDCH means the Michigan Department of Community Health.

Outcome: The council unanimously voted to amend the definitions.

MML Amendments: Privacy – Getting Information on Past Criminal History

As part of the application form requirements, an amendment inserted additional language so that applicants would need to provide a statement about criminal backgrounds of people named on the application. City attorney Stephen Postema explained that such a requirement is appropriate in light of the state’s ruling that the LEIN (Law Enforcement Information Network) cannot be used for background checks for medical marijuana issues.

(2) An application for a new annual license or the renewal of an existing license for a cultivation facility or dispensary, shall be submitted to the City Clerk on a form provided by the City, which shall fulfill all of the requirements indicated on the form, including but not limited to:

(f) A statement with respect to each person named on the application whether the person has:
(i) Ever been convicted of a felony involving controlled substances as defined under the Michigan public health code, MCL 333.1101, et seq, the federal law, or the law of any other state and, if so, the date of the conviction and the law under which the person was convicted;
(ii) Ever been convicted of any other type of felony under the law of Michigan, the United States, or another state, and, if so, the date of the conviction and the law under which the person was convicted.

If a criminal background check can’t be done through LEIN, Marcia Higgins (Ward 4) wanted to know what it would cost using some other method. Assistant city attorney Kristen Larcom thought it might cost around $15, but she was not sure. Not being able to use LEIN, said Larcom, had the disadvantage of not automatically getting information from states other than Michigan. Sabra Briere (Ward 1) clarified that the cost of doing a criminal background check would be covered as a part of the application fee.

Outcome: The council unanimously approved the inclusion of a statement on criminal history in the application.

MML: Amendments – Application versus License Requirements Part 1

A set of changes that were intended in part to separate the application requirement from the requirements on awarding a licenses, read, in amended form, as follows:

(2) An application for a new annual license or the renewal of an existing license for a cultivation facility or dispensary, shall be submitted to the City Clerk on a form provided by the City, which shall fulfill all of the requirements indicated on the form, including but not limited to:

(h) Payment of a non-refundable application fee, which shall be determined by resolution of the City Council.

Additional amendments that were a part of license requirements were initially included in a motion, then withdrawn after discussion, leaving just the payment of the application fee.

Outcome: The council unanimously approved the payment of the application fee as a part of the application requirements.

MML: Amendments – Application versus License Requirements Part 2

Sabra Briere (Ward 1) then focused the council’s attention just on the set of amendments for licensing requirements. In their approved form, they read as follows:

(3) License Requirements. A new license shall not be issued to a dispensary or cultivation facility until the applicant for the license complies with all of the following requirements:
(a) The applicant has submitted a complete application and the application fee.
(b) The proposed dispensary or cultivation facility is located in a zoning district that permits its operation.
(c) The applicant has a valid and current certificate of occupancy.
(d) The applicant has installed a sign containing the following statement:
(e) The applicant has installed the following security measures on the premises: …

Christopher Taylor (Ward 3) wanted to make sure that the language is sufficiently clear to guard against the idea that there’s any kind of a “right” to a license if all conditions are met. City attorney Stephen Postema said he’d need to think about it further. Taylor was interested specifically in the case where there were no licenses available for issuance. Stephen Kunselman (Ward 3) wanted some clarification about how the licensing board would be doing a review that is annual. Tony Derezinski (Ward 2) suggested that there would be “comparative review,” where there are a limited number of licenses and the relative merits of applicants would have to be evaluated. Derezinski went on to say that the medical marijuana licenses would be very valuable.


Left to right: Councilmembers Carsten Hohnke (Ward 5), Stephen Kunselman (Ward 3), Sandi Smith (Ward 1).

Marcia Higgins (Ward 4) was concerned that an applicant could invest a lot of money in obtaining a certificate of occupancy – why would they do that unless they’d obtained a license?

The original amendment that Briere introduced, supported by Sandi Smith (Ward 1), included an option that did not require the posting of a sign: “The applicant must install a sign, or provide the city with a written plan of an alternate means by which patients, each time they visit the business will be provided with the following written statement…”

The original amendment included requirements on lettering, both for the signage and for the individually-issued written statements: ” … sign must have letters no smaller than one inch high and be installed in a location visible to all persons who enter the premises. If the applicant elects to provide the statement to patients individually in writing, then that statement must be in capital letters in bold type no smaller than 14pt font.”

Stephen Rapundalo (Ward 2) wanted to know what the rationale was for the alternative to a sign. Smith said that a sign could become invisible, after walking past it several times. Having something in your hand would be more effective. Rapundalo was concerned about the ability to enforce compliance – a sign is very easy to check for compliance. If a dispensary thinks it can get away without displaying a sign, then they wouldn’t display one, he said.

Smith said she would eventually be suggesting that an additional piece of paper be given to every visitor – with educational information about substance abuse – and her vision was to use the same mechanism to convey the information on the sign. Carsten Hohnke (Ward 5) said he felt it was relatively innocuous to require posting a sign as a means of compliance.

Taylor proposed amending out the alternative to posting the sign. Councilmembers voted to eliminate the alternative, over dissent from Smith and Briere.

Kunselman questioned whether certificates of occupancy could be issued to applicants – they could only be issued to facilities, he contended. Postema allowed that there had been a lot of people “messing around” with the language and that he would look into that specific issue.

Outcome: The council voted unanimously to amend the license requirements without the alternatives to posting signs.

MML: Amendments – Insurance and License Fees

An amendment to the license requirements added requirements on proof of insurance. As approved, the amended portion reads:

(3) License Requirements. A new license shall not be issued to a dispensary or cultivation facility until the applicant for the license complies with all of the following requirements:

(g) The applicant provides the City with a certificate signed by a qualified agent of an insurance company evidencing the existence of valid and effective policies of the following types of insurance, as well as a copy of an endorsement placed on each policy requiring ten days’ notice by mail to the City before the insurer may cancel the policy for any reason:
(i) Workers’ compensation insurance in accordance with Michigan statutory limits and Employers Liability Insurance with a minimum limit of $100,000 each accident for any employee.
(ii) Public liability and personal injury insurance with minimum limits of $500,000.00 for each occurrence as respect to bodily injury liability or property damage liability, or both combined. Documentation must explicitly state the following:
(a) the policy number;
(b) name of insurance company;
(c) name and address of the agent or authorized representative;
(d) name and address of the insured;
(e) location of coverage;
(f) policy expiration dates; and
(g) specific coverage amounts.
An original certificate of insurance may be provided as an initial indication of the required insurance. Applicant shall be required to continue without interruption during the term of the license the above named insurance coverages. If any of the above coverages expire by their terms during the term of a license, the Applicant shall deliver proof of renewal and/or new policies to the Administering Service Area/Unit at least ten days prior to the expiration date. Insurance companies, named insureds and policy forms shall be subject to the approval of the City Attorney, within five business days. Insurance policies shall not contain endorsements or policy conditions which reduce coverage required under the terms of the license.
(h) The applicant has paid the non-renewable license fee, as determined by resolution of the City Council.

The timeframe for the city attorney to approve issuance forms was inserted at the request of Marcia Higgins (Ward 4).

In the original amendment by Sabra Briere (Ward 1), there was an additional alternative for the license fee: “In the fee resolution, Council may establish a two-tiered license fee such that there is a lesser license fee for a business that makes a specific donation to a non-profit educational organization, which is listed in the resolution and the purpose of which is to educate and address drug abuse issues or to provide education as to best practices for ensuring to the extent possible that the medical marijuana cultivated for and provided to patients is safe and not harmful to their health.”

Christopher Taylor (Ward 3) asked about the material costs in processing applications, and city attorney Stephen Postema confirmed that they would likely exceed four figures. Sandi Smith (Ward 1), who’d supported the inclusion of a nonprofit donation provision, explained that it was prompted by a conversation with someone working at the state level in Colorado, who’d advised that once marijuana is more readily available – as it now is in that state – it can lead to substance abuse problems. Both Taylor and Stephen Rapundalo (Ward 2) felt that the city already has a systematic way of determining which nonprofits it allocates money to. [Rapundalo is one of the architects of the scoring metric for that system.] The council amended out the alternative, over the dissent of Smith.

Outcome: The council voted to amend the license requirements to include the insurance provisions, but not for the fee structure to include nonprofit donations.

MML Amendments: Licensing Issuance

After some wording changes to make clear that a license would be issued only if a license is available, the condition on issuance of a license was amended as follows:

6:418. Issuance of License. The city administrator or designee shall issue a license for a cultivation facility or dispensary to the applicant if a license is available for issuance and if all requirements of this Chapter have been met. …

Marcia Higgins (Ward 4) wanted to clarify that the city administrator is also empowered to deny a license if conditions had changed since the application had been received by the city.

Outcome: The council unanimously approved the amendment to the license issuance language.

MML Amendments: Safety/Privacy – Contact Information about Product

In order to address the concern that a patient needs to have some way of getting in touch with someone about the product they’d been provided, as well as have access to information about substance abuse, an amendment was proposed to include contact information on the required labeling:

(4) All marijuana delivered to a patient shall be packaged and labeled as provided in this chapter. The label shall include:

(f) The name, address, e-mail address, and telephone number of an authorized person who a patient can contact with any questions regarding the product.
(g) The name, address, e-mail address, and telephone number of at least one organization who may be contacted by a patient who has concerns about substance abuse of drugs, including marijuana.

Outcome: Without discussion, the council unanimously voted to amend the required labeling to include contact information.

MML Amendments: Safety/Privacy – Product Sourcing Records

After a lengthy discussion, the council elected to leave intact a requirement on dispensaries’ record-keeping:

6:419. Conduct of Business at Cultivation Facility or Dispensary.
(9) A cultivation facility or dispensary shall keep records of the persons from whom they received marijuana in any form, and shall make the records available to the City for review upon request.

One of the proposed amendments read aloud by Sabra Briere (Ward 1) [developed by Sandi Smith (Ward 1)], but ultimately not approved, was as follows: “A cultivation facility or dispensary shall keep records for each delivery of marijuana in any form to the cultivation facility or the dispensary of the following: the registry number on the caregiver identification card that the MDCH issued to the caregiver who is delivering the marijuana, the registry number on the caregiver identification card that the MDCH issued to the patient who accepted delivery, the type and volume of the product and the date of the delivery. These records shall be made available to the City for review upon request.” [A different alternative, which was not moved for consideration by the council, eliminated reference to the registry numbers and required the dispensary to create a unique identification system.]

Smith did not want the language included that would require a dispensary to make records available to the city upon request. She simply wanted a patient to have some way of tracing the origin of problematic marijuana through the dispensary. She floated the idea of requiring that a request for records be triggered by some identified public health risk.

Mayor John Hieftje was worried that such an approach wouldn’t provide any oversight, in the event that there was a public health issue. Stephen Kunselman (Ward 3) noted that the city of Ann Arbor does not have a health department and thus he did not feel that the city had any expertise to trace the product and to determine if a patient was sickened by a particular product.

The discussion turned to what entity should take action in response to any kind of public health problem suspected to be due, say, to tainted product. Tony Derezinski (Ward 2) pointed to the licensing board as a possibility – it should be up to that board to request the information. Stephen Rapundalo (Ward 2) floated the idea that it should be state or county health officials.

The conversation by the council on this point was lengthy. But the perspective that seemed to be persuasive to many councilmembers was the idea that before tasking public health officials with a responsibility to try to track down tainted product, it would be important to check with relevant agencies to see if they’re willing and able to take on such a task, including the Michigan Dept. of Public Health.

Outcome: The council voted unanimously against the amendment, leaving 6:419 (9) intact.

MML Final Outcome

If the city council votes on an ordinance at a first reading, but then subsequently amends it, sometimes the change is substantial enough that it must be voted again as a first reading before proceeding to its public hearing and second reading.

John Hieftje

Mayor John Hieftje.

So midway through the deliberations, Mayor John Hieftje asked city attorney Stephen Postema if any of the changes that had been identified as possibly needing to be reworked would necessitate a return to first reading – if the council were to vote on the entire ordinance that night and to make amendments along the lines they’d discussed. At that point, Postema felt that none of the changes he foresaw would be substantive.

However, after discussion of 6:419 (9) Postema was more hesitant, when queried by Christopher Taylor (Ward 3). Postema said it’d be a “close call.” Taylor was inclined to give the ordinance its first vote, even if it meant that the council eventually had to give it an additional first vote. Sandi Smith (Ward 1) had an idea of a revision to 6:419 (9) that would be different from the current version and moved for a postponement on those grounds. Marcia Higgins (Ward 4) was keen to have a clean version available before giving the ordinance its first vote.

Hieftje said he didn’t have a problem delaying again, and said no one should be saying that the council couldn’t get its work done. They were simply taking a great deal of care, he said.

Outcome: The council voted to postpone consideration of the medical marijuana licensing ordinance until its March 21, 2011 meeting.

Present: Stephen Rapundalo, Mike Anglin, Margie Teall, Sabra Briere, Sandi Smith, Tony Derezinski, Stephen Kunselman, Marcia Higgins, John Hieftje, Christopher Taylor, Carsten Hohnke.

Next council meeting: Monday, March 21, 2011 at 7 p.m. in the Washtenaw County administration building, 220 N. Main St. [confirm date]


  1. March 20, 2011 at 9:54 pm | permalink

    A true reporting masterpiece!

  2. March 21, 2011 at 9:03 pm | permalink

    You really have become Ann Arbor’s “paper of record” for council actions.

  3. March 28, 2011 at 10:25 am | permalink

    As always the most precise reporting…

    Ps.. arrested on Mar 16th [link]

    Attorney Mike Kammorn will represent 3-31 a2