Published in Economic Development

West Michigan business wrestle with unknowns over marijuana

BY Sunday, October 21, 2018 08:56pm

As Grand Rapids adjusts to a new medical marijuana ordinance and as voters consider legalizing recreational marijuana later this year, employers continue to express uncertainty about the future.

That was a key message from several policy experts who spoke during a Cannabis Summit hosted at the offices of the Grand Rapids Area Chamber of Commerce in downtown Grand Rapids last week.

While labor attorneys and addiction doctors say they’re left with a sense of uncertainty over the wave of liberalization of marijuana laws around the country, industry experts say many of the fears are ungrounded.

“The sky is not falling here,” Chris Woods, CEO of Boulder, Colo.-based medical marijuana company Terrapin Care Station, told the crowd gathered for the summit.

According to Woods, Colorado has been largely successful with legalized recreational pot since 2012.

But employment experts say that the rising tide of regulated medical marijuana, coupled with the possibility of legalized recreational marijuana — which voters will consider next month — creates an increased sense of uncertainty for employers, particularly in a tight labor market.

“What I’m telling people is, ‘I don’t know,’ said Steven Palazzolo, senior counsel in the Grand Rapids office of Warner Norcross + Judd LLP, when asked how he’s advising his client base.

“We’ve got some history now with medical marijuana and how it’s affected those of you who are employers — and it has affected you,” Palazzolo said. “You’re already having trouble finding people. If you’re a drug-testing employer, that little card has made it harder to find people. When recreational use becomes legal — and we all think it will — now you’ve got to make some decisions about what you’re going to do in an environment like this where you’re having trouble finding people. Excluding an entire population of people that uses a now-legal substance is an interesting problem.”

Polls show that support for Proposal 1, which would legalize adult use of recreational marijuana statewide, has now reached nearly 60 percent, according to a report earlier this month in the Detroit News.

Many companies that use drug testing as a pre-employment offer qualification are rethinking their processes, Palazzolo said, noting some are questioning whether they would want to fire an employee who tested positive for using what could soon become a legal substance.

Increasingly, clients are re-examining drug-testing policies overall, he said.

“I’ve already got clients that are trying to decide whether they want to continue doing pre-employment testing because they’re losing candidates and they’re having a hard time finding people,” he said. “I think that’s just going to get worse.”

At least within the marijuana industry, executives say they aim to ensure that their workplaces are professional and safe. Speaking during the Chamber’s summit on Thursday morning, Joe Neller, executive vice president for government affairs and business development for Green Peak Innovations LLC, noted the Lansing-based medical marijuana company does drug testing for a variety of illegal substances and has a zero-tolerance policy regarding use of marijuana on company property.

Shortly after Neller presented during the summit, Green Peak Innovations announced the state licensing board unanimously approved two Class C cultivation licenses for the company. The company is in the process of building out its headquarters in Windsor Township near Lansing, part of the Harvest Park Development LLC medical marijuana industrial park, as MiBiz previously reported.

The nonpartisan Michigan Senate Fiscal Agency projects that legalized recreational marijuana could generate $262 million annually for the state by 2022, according to a report released last week.

But to some in the medical field and other concerned stakeholders, the legalization of recreational marijuana use could create hidden costs as well.

Skeptics such as Dr. Talal Khan, an adult psychiatrist and addictionologist for Pine Rest Christian Mental Health Services, said he sees little hard science that makes him believe marijuana has significant medicinal value.

During a roughly 10-minute presentation at the Chamber’s summit, Khan ran through a litany of his medical concerns, ranging from short- and long-term health impacts of marijuana to questions of what legalization could mean for the state’s workforce.

“As a physician, I know our guest said that the sky is not falling,” Khan said, referring to a previous statement from Terrapin Care Station’s Woods. “I would say it is falling, but it’s going to fall really slow.”

Included among Khan’s concerns are lingering questions about increased access to the substance for minors.

However, a 2015 Colorado study showed that regular use of marijuana among youths actually declined from 2009 to 2015.

Business advocacy groups like the Grand Rapids Chamber opposed legalization, citing the unknown implications for the organization’s membership as its key concern.

However, Andy Johnston, the Chamber’s vice president for government and corporate affairs, concedes the organization and its membership ultimately have to accept the will of the voters and work to prepare West Michigan businesses.

“If it is going to become law, these are all things we have to grapple with as a community, as employers,” Johnston said. “We can’t put our head in the sand.”

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