Michigan Explores Cannabis Tech to Bolster Business Activity - Accela

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Michigan Explores Cannabis Tech to Bolster Business Activity

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When Michigan began issuing medical marijuana licenses last summer many wondered how the new industry would benefit the state and the state’s economy. Yet now, with more than $1 million in tax revenue collected each month from medical cannabis businesses, and the approval of recreational marijuana last year, Michigan is investigating how it can continue to use digital tools to support the industry’s regulation and economic growth.

Michigan partnered with Accela to deploy one of the first statewide permitting and licensing systems for medical marijuana in the nation, and the Detroit News reports that since the system’s launch, the state has regularly collected more than $1 million in revenues each month, with outside forecasters estimating an additional $100 million a year in excise tax revenue and $66.5 million in sales tax revenue by 2021 with recreational cannabis. The success presents new challenges for the state as it tries to find a way to make tax collection easier for cannabis business.

With federal prohibition of cannabis still in effect — although this could change with support from federal policy makers — traditional banks are still leery to finance or hold checking accounts for cannabis businesses. This has compelled marijuana business owners to pay taxes in large amounts of cash, something that state already working diligently to avoid.

Jerry Millen, co-owner of the Oakland County based Greenhouse Dispensary in Walled Lake, told the Detroit News some of his fellow cannabis business owners are paying taxes with cash deposits of $20,000 to $40,000.

“The biggest thing is safety,” Millen said. “I want to make sure my employees are safe, my patients and customers are safe, so I don’t want to have a facility that just has a large amount of cash lying around.”

As part of the state’s push for tech solutions, the state is facilitating a data portal that will help to legitimize cannabis businesses and ensure banks can meet federal vetting requirements. Further, last fall Michigan’s Legislature approved a law so the state can share financial background, real-time data and transaction information with banks for businesses that volunteer such information. The system is nearing completion.

“I think it will help encourage financial institutions to start participating,” said Andrew Brisbo, director of the Michigan Bureau of Marijuana Regulation to the Detroit News. “I think, ultimately, the solution both for tax collections at the state level as well as for support for the industry is to help facilitate banking relationships, so they can do business in a more modern-day traditional method.”

As one of the first states to lay the ground work for cannabis regulation, Michigan is a state to watch as they implement legislation and adopt digital, modern-day tools. Michigan’s Department of Licensing and Regulatory Affairs (LARA) selected Accela’s Civic Solution for Cannabis so staff could manage tasks, workflows, and process applications quickly. In a press release Brisbo said it helped the state to deliver an easy-to-use, modern licensing solution for residents.

“Accela offered an out-of-the-box solution for the essential back office and customer-facing functions we knew were essential for a successful launch,” Brisbo said. “The system allowed us to be creative in our approach to implementing our processes and adjusting on the fly as our knowledge of the industry grew.”

He added that the solution enabled the state to adapt to possible changes in laws and regulations, and this characteristic of the system was essential to offer quality service to residents.

“We wanted a customer portal that took traditional counter services and moved them to the web to maximize the benefits of providing 24-hour self-service.”

Click here for more details about the Accela Civic Solutions for Cannabis.

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Accela

Since 1999 Accela has provided market-leading software solutions that empower state and local governments worldwide to build thriving communities, attract and grow businesses, and protect citizens. From planning, building, licensing and permitting, to asset and service request management, finance, environmental health and more, Accela’s SaaS offerings are designed to readily solve government’s biggest challenges with extensive domain expertise built into every solution. Powered by Microsoft Azure, Accela’s open and flexible workflow automation technology helps agencies address specific constituent needs today, while ensuring they are prepared for any emerging or complicated challenges in the future. Accela’s solutions serve more than 80 percent of America’s largest cities. Accela is headquartered in San Ramon, California, with additional offices around the world. For more information, visit www.accela.com.

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