Michigan's marijuana industry sending $60M to cities and counties with pot businesses

LANSING, Mich. (FOX 2) - Continued growth of Michigan's marijuana industry is paying dividends with the state sending out just shy of $60 million to counties and local governments.

Local governments that have approved the recreational sale of weed in their county, city, village, or township will see approximately $51,800 for every retail store and micro-business that it's handed out licenses to. 

Only 30% of total adult-use sales go to local governments, with the other 70% going to schools and roads. When contributions from last year are paired next to figures from 2021 and 2020, they show an industry that shows no signs of slowing down.

Washtenaw County, which has distributed 40 business licenses saw the most return at around $2 million. Ann Arbor and Lansing were the only cities to eclipse a million in returned funding.

You can see the entire marijuana license count for fiscal year 2022 here.

Funding contributions

Michigan has only redistributed revenue from recreational sales for the past three years since it was legalized in December 2019.

• From sales in 2020, $9.9 million was paid out to local governments, which came out to $28,000 per license.
• From 2021, $42.2 million was paid out, about $56,453 per license.
• This year, the total revenue sent to governments was $17 million higher, however, the amount of money per license sent out fell by $5,000.

Marijuana business growth

While ingesting weed is legal in Michigan, governments still need to give approval for businesses to set up shop within their boundaries. The number of new dispensaries and microbusinesses has ballooned in Michigan in the past two years.

• In 2020, there were 104 municipalities that handed out 356 licenses for the sale of recreational weed
• In 2021, there were 163 municipalities that reported a total of 748 business licenses
• In 2022, 224 municipalities had registered 1,148 business licenses

Marijuana growth in Michigan

The latest figures come from the Michigan Department of Treasury which reported $198.4 million in revenue from recreational pot last year. Another $69.4 million will go to School Aid Fund, while $69.4 million will go to the transportation fund. 

In total, $1.8 billion in sales from weed came last year.

To put that in context, there were $341 million in total sales in 2020. In 2021, the state reported $1.1 billion in sales.

Michigan continues to pull in some of the highest recreational weed sale totals among states that have legalized it. According to MJBiz, which covers the cannabis industry, Michigan reported the second-highest number of weed sales per month, coming behind only California. 

Cannabis has seen prices seesaw since being legalized, starting off expensive before plummeting as more dispensaries have opened up. 

Illegal weed sales also still makes up a big portion of the industry. A report from 2021 found that up to 70% of all sales for weed in Michigan were illegal.

The one city that isn't on the most recent report from the treasury is Detroit, which only opened its first recreational business this January.