In a potentially under-appreciated risk for cannabis growers and processors in Michigan, there are important environmental laws and permits that must be complied with in order to avoid jeopardizing business operations and state-issued licenses.
There are several environmental laws that apply to growers and processors, along with the various environmental permits that are needed. A prudent cannabis business should presume that the Department of Environment, Great Lakes, and Energy will notify CRA of any enforcement activities for violations of environmental laws. Such violations will be taken into account by CRA for licensing decisions.
Unbeknownst to some applicants, a license from the CRA is not a certification that the grower or processor is in compliance with environmental laws as enforced by EGLE. Even with an active license from CRA, the grower or processor may still need certain permits from EGLE, such as a permit to withdraw water, to use or build on certain lands (such as wetlands), to discharge wastewater (with pollutants such as those from fertilizer) or for waste management purposes. If the grower or processor is unaware that they need a permit, they could find themselves in violation of various laws even if they are operating with a valid license. In fact, EGLE representatives have expressed concern about the large discrepancy between licenses given by CRA and the number of environmental permits given by EGLE.
EGLE seems intent on notifying CRA of any violations they discover. If CRA is notified of a violation, it is clear the violation will be taken into account for licensing purposes. Growers and processors should ensure compliance with all environmental laws to avoid drastic consequences down the road.
Varnum has successfully represented cannabis clients in environmental matters such as wetlands and air quality violations. Please contact a member of our Cannabis Team if you have environmental compliance concerns or questions.
This advisory was originally posted on February 11, 2020, and was updated on January 10, 2023.