Michigan’s Medical Marijuana Program Has $23,000,000 Surplus

Michigan’s Medical Marihuana Program (MMP) has a surplus of $23,534,952.42, accumulated over the Program’s almost 5-year existence, per officials from the state’s Department of Licensing and Regulatory Affairs (LARA).

The fund balance was revealed in an article by MLive’s Jonathan Oosting, a Capitol reporter for the news agency, and the source was identified as Jeannie Vogel from LARA. The figure represents the fund balance as of September 30, 2013.

The MMP began operation in April 2009 under the authority of the Michigan Department of Community Health. After Governor Snyder was elected in 2011, administration of the program was transferred to the newly-created LARA. The program has just two sources of revenue: registration fees paid by medical marijuana patients and caregivers, and income from investments made under the direction of the Treasurer of the State of Michigan.

Although the money from overpayment of fees has been banked since 2009, legislation passed in 2012 created a special account called the Medical Marihuana Fund. That Fund is also maintained and controlled by LARA.

As previously reported by The Compassion Chronicles, the Fund is undergoing some changes in expenditures and revenue.

Michigan’s legislature approved a line in the FY 2014 budget to allow for a $3 million payout to local law enforcement agencies for the purpose of “education on, and enforcement of, the Michigan Medical Marihuana Act.” Per the MLive article, that payout has not happened yet, although the clear language of the budget required police agencies to have submitted written requests to tap into that $3,000,000 kitty during 2013.

“We have been working with the Legislature to further clarify the language to ensure we are not in conflict with the existing statutory language,” MLive quoted Vogel as saying.

A second change in the MMP, also mandated by that 2012 legislation, changed the registration period for patients and caregivers from one year to two, creating 50% less work for the MMP without a corresponding increase in registration fees. That plan went into effect April 1 of 2013.

A patient can register with the MMP for $100; certain disadvantaged people qualify for a reduced rate of $25. Caregivers, people who are licensed to grow marijuana on behalf of patients that cannot do it for themselves, do not have a specific registry fee when registering at the time the patient sends in their own renewal paperwork. A $10 fee applies to the processing of forms filed to add or change a caregiver assignment, or to correct address information.

Despite the reduced workload, don’t expect to see a drop in the MMP budget any time soon. Vogel said expenses “will continue to go up due to increasing fixed costs and paying for an existing database upgrade project. Once the project is completed we anticipate costs could drop barring any changes to the existing statute.” LARA expends nearly twice the money per card issued than the Department of Community Health did just three short years ago (See above graphic).

Vogel did not give much hope that the registration fee for Michigan’s sick and injured will be reduced. She was quoted as saying LARA is “researching” the possibility of reducing the fee structure.