Michigan Lawmakers Considers Freeze on Cannabis Business Licenses, Limit Dispensaries by Population, Regulation of Synthetics

The package of proposals, introduced by State Senator Sam Singh (D), would stop the state from issuing new licenses for testing labs, transport companies, and large grow operations beginning in 2026. It would also restrict municipalities to no more than one dispensary for every 10,000 residents, though existing businesses would remain open even if a city or town is already over the limit. The proposal comes as Michigan prepares for a new 24% wholesale marijuana tax, set to take effect in January. The tax is projected to raise hundreds of millions of dollars for road repairs, but businesses warn it could cripple profitability.

The Senate Fiscal Agency noted the legislation could create “regional monopolies or oligopolies” in communities already packed with dispensaries. Based on the population cap established under the bill, dozens of cities would already be at their max number of dispensaries.

Alongside the licensing changes, lawmakers are also targeting synthetic marijuana products derived from hemp. Senator Dayna Polehanki (D) said gas stations and convenience stores are selling intoxicating compounds with “no oversight.” Testing has revealed harmful contaminants, prompting calls to place them under the state’s Cannabis Regulatory Agency.

Because the legislation would amend Michigan’s voter-approved legalization law, it must clear both legislative chambers with three-fourths support before reaching Governor Gretchen Whitmer. Senate Regulatory Affairs Chair Jeremy Moss (D), said multiple hearings will be held to gather feedback, stressing that the goal is to bring “stability” to a struggling industry.