This story was reprinted with permission from Crain’s Detroit and written by Dustin Walsh.
When the Detroit City Council finally codified its recreational marijuana codes, it was Kim James who drafted the language. She’s worked in code enforcement for the city most of her career. Now as the director of the office of marijuana ventures and entrepreneurship, James must stand up those codes and get recreational dispensaries licensed. But the city itself is behind, as most of the state’s industry has been selling weed for nearly three years.
How did marijuana regulation land on your plate?
After the MMMA (Michigan Medical Marihuana Act) passed in 2008, during the mortgage crisis, all these pop-ups or illegal commercial establishments started showing up. About 300 of them by 2014, 2015. Marijuana sales had been legalized for caregivers but no commercial facilities were legal. (Detroit) Mayor (Mike) Duggan encouraged us to regulate them responsibly because we knew commercial use was coming. So we were tasked with creating a caregiver center model and worked to get these pop-ups licensed, while also closing some. The commercial facilities act (the Medical Marihuana Facilities Act of 2016) came online and we went to work. We then turned to adult use as voters passed that legislation in 2018.
What is your role in this new department in the city?
We’re part of the civil rights and inclusion department in the city. The (recreational marijuana) code requires when someone submits a license application, it must go to a multi-department committee for review … I chair that committee. The committee is made up of many departments in the city and we submit a recommendation to the building department, which issues the license, on whether we think the license should be approved. We also have social equity programming we’ve rolled out and we oversee its implementation.
What was your office’s role in the new ordinances for recreational marijuana sales?
I drafted all the ordinances. Before this role, I was a lawyer for the city. So I worked directly with (then) Counsel Member (James) Tate. We worked for basically a year, every Friday for three hours we would do these Zoom meetings about what would go in the ordinance. That ordinance passed in Nov. 2020. But a lawsuit challenged that ordinance. So we revised it last year to create the equity program we have now. It was introduced by President Pro Tem Tate and passed in April. We’ve been challenged, legally, again, but we think this ordinance is good.
Marijuana prices have collapsed in recent months. Do you worry standing up new companies in Detroit is now going to be difficult?
I do have worries, but not necessarily about that. While supply has increased, demand has also increased. There is not a lack of buyers. I don’t know the reasons the market has happened this way, though. There are a lot of illegal operations, growers who aren’t licensed. That’s a state issue, but it does detract from legal licenses. We’ve seen it happen in California. It’s too expensive and overtaken by competitors who aren’t licensed. I think the market will take care of itself. I’m not so worried about that. We have a robust licensing program and we’re able to issue all the licenses we have.
The city began accepting dispensary licenses on Sept. 1. What’s happening now?
We have two types of licensing. An unlimited license for growers, transporters, etc.. We’ve been licensing them since April. That’s going well. We have an electronic process for that. The limited licensing program, for retailers and consumption lounges, just opened on Sept. 1. The applications period is open for 30 days. So after that 30 days, they’ll be scored and licenses will be issued. That’s extremely exciting for me. We worked so hard getting these laws into place. To me, I have succeeded as a lawyer in getting the program ready. But implementation and getting licenses out is a whole other endeavor. But we’re ready for it.
What lessons have you learned about creating an entirely new industry?
It’s an ongoing lesson. We’re always learning and trying to retool. We use a lot of electronic platforms for processing. We’re doing a lot of back-end changes for us to review things. Those are the things I care about. I am a Six-Sigma, lean-processing person. But we’re also dealing with and are up against city bureaucracy. Things take a long time to change or improve. My lessons are about how aggressive to be when you’re trying to make a change. I’m constantly looking for process improvements and this process has allowed a lot of opportunity. We’re also learning about the social equity program. We have a lot of social equity students and we work hard to meet them where they are — realizing that people that may be interested in this industry, may have no idea how to run a business. So helping them understand what it takes to have such a business has been a learning experience.