Michigan Marijuana Pays Dividends

Marijuana and US dollars Michigan
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Ann Arbor tops list of Michigan cities getting marijuana money

ANN ARBOR, MI — With more marijuana dispensaries than any other city in the state, Ann Arbor remains the commercial cannabis capital of Michigan.

And it’s paying off.

With $1.4 million coming to the city, Tree Town tops the list of cities, townships and villages getting marijuana tax revenue from the state this year from retail sales in fiscal year 2022.

Meanwhile, Washtenaw County in Michigan is getting the biggest county-level share in the state at nearly $2.1 million.

Overall, the state is doling out nearly $60 million in tax revenue to local communities from last year’s sales at 574 licensed cannabis businesses, while the state’s school aid and transportation funds are each getting nearly $70 million.

Ann Arbor and Washtenaw County have the most marijuana retailers in the state with 27 in the city and 40 across the county, including 10 in Ypsilanti and three in Northfield Township.

Ypsilanti is getting $518,412 in marijuana tax revenue this year (up from $338,721 last year), while Northfield Township netted $155,524 (up from $56,453).

The amount going to Ann Arbor is about the same as last year, while the county’s share increased by over $267,000.

With high demand from cannabis entrepreneurs looking to set up shop in Ann Arbor, home of the annual Hash Bash, the city decided four years ago to cap the number of dispensaries in the city at 28 to avoid a more massive influx as the state legalized recreational marijuana. The city’s limit remains in effect.

Lansing trails behind Ann Arbor with the second-most licensed marijuana retailers at 21, and with over $1 million in revenue.

Ann Arbor officials have yet to make any final decisions about how to spend this year’s $1.4 million, but they decided to put previous marijuana money toward social-equity programs and helping people negatively impacted by the war on drugs. That included criminal diversion and deflection programs to keep people out of jail and criminal record expungement, among other programs to help BIPOC and low-income populations.

City Administrator Milton Dohoney is expected to lay out his budget recommendations for the coming year in April, with City Council having the final say in May.

“We are knee deep in the budget process now,” Dohoney said, adding it’s too early to say how the money may be spent.

Council Member Cynthia Harrison, D-1st Ward, said she’d like a majority of the city’s marijuana dollars to go toward addressing harms caused to generations of largely Black and brown people who have been negatively impacted by the mass criminalization of marijuana in the past.

The city should be intentional about investing in communities and individuals whose lives have been impacted or upended by marijuana arrests, prosecution, incarceration and convictions due to practices, policies and laws that disproportionately targeted and disadvantaged people of color and lower socio-economic status, Harrison said, calling it a racial justice issue.

One way to put that into practice, she said, is to bring trauma-informed case management to the Michigan city’s new Supportive Connections deflection program, which aims to provide social services to assist people in need from becoming involved or reinvolved with the criminal justice system.

As for how Ypsilanti may spend its roughly $518,000 windfall, Mayor Nicole Brown said she was alerted to the new tax revenue amount on Tuesday, Feb. 28, and the City Council hasn’t yet had a chance to discuss it.

In past years, Ypsilanti leaders have put marijuana money toward social-equity efforts, from contributions to the county’s Barrier Busters program to criminal record expungement. But while crafting their budget last year, they also made clear some of that spending was intended to be one-time, not reoccurring.

The city faced the prospect of a budget shortfall last year, a trend expected to continue. Marijuana dollars could help reduce the projected deficit, especially with an expected increase in city contract costs, City Manager Frances McMullan said.

Northfield Township, north of Ann Arbor, is receiving nearly triple the amount of marijuana revenue after the number of marijuana retailers in its jurisdiction grew from one to three, including dispensaries in the Whitmore Lake area along U.S. 23.

The roughly $56,000 received last year was placed in the township’s general revenue account and not designated for a specific project, and officials haven’t yet considered how to spend this year’s $155,524, Township Manager Mark Lloyd said. Budget workshops are coming up for the township board ahead of a spending plan being adopted by the end of June, he said.

Washtenaw County officials are discussing the county’s nearly $2.1 million allocation and will be releasing details about how it will be used, county spokesperson Crystal Campbell said.