LANSING – Michigan is sending nearly $94 million in adult-use marijuana tax revenue back to local governments across the state, with Detroit, Grand Rapids, Lansing and Ann Arbor among the largest municipal recipients.

According to the Michigan Department of Treasury’s 2026 distribution report a total of $83,773,685.60 was distributed based on cannabis revenues collected during 2025.

Of that:

  • $46.9 million went to cities, villages and townships

  • $46.9 million went to counties

  • $54,017.10 was paid per licensed retail store or microbusiness

The payments are required under the Michigan Regulation and Taxation of Marihuana Act (MRTMA), which directs a portion of the state’s 10% excise tax to local governments that allow marijuana retail operations within their borders.

A total of 868 licensed retail stores and microbusinesses qualified for distributions statewide.

Detroit Leads All Municipalities

Because distributions are tied directly to the number of licensed retail stores, larger cities with more dispensaries saw the biggest payouts.

Here are the top municipal recipients:

City Licenses Distribution
Detroit 61 $3,295,043.10
Grand Rapids 27 $1,458,461.70
Lansing 26 $1,404,444.60
Ann Arbor 23 $1,242,393.30
Kalamazoo 19 $1,026,324.90
Flint 12 $648,205.20
Traverse City 11 $594,188.10
Hazel Park 11 $594,188.10

Detroit’s payout alone topped $3.29 million, reflecting its 61 licensed retail stores.

College towns also ranked high. Ann Arbor received over $1.24 million, while East Lansing collected $270,085.50 from five licenses.

In West Michigan, Grand Rapids received nearly $1.46 million, and Kalamazoo topped $1 million.

Counties See Even Larger Totals

County distributions are calculated using the same per-license formula, meaning counties benefit from every licensed retail store located within their borders — regardless of which municipality hosts the business.

The largest county distributions include:

County Licenses Distribution
Wayne County 98 $5,293,675.80
Oakland County 49 $2,646,837.90
Washtenaw County 44 $2,376,752.40
Kent County 39 $2,106,666.90
Genesee County 35 $1,890,598.50
Ingham County 35 $1,890,598.50

Wayne County received more than $5.29 million, the largest single county payout in the state.

How the Formula Works

The distribution is straightforward:

  • Every licensed adult-use retail store or microbusiness generates a payment of $54,017.10.

  • The municipality hosting the license receives that amount.

  • The county where the license is located receives the same amount.

The system creates a direct financial incentive for communities to allow cannabis retailers.

Communities that opted out of recreational marijuana retail receive no distribution.

That policy choice has created clear revenue disparities between municipalities.

For example, cities like Detroit and Grand Rapids, which embraced cannabis licensing, are now seeing multi-million-dollar annual returns. Meanwhile, communities that banned retail marijuana operations are not participating in the revenue stream.

Smaller Communities Also Benefit

While large cities dominate headlines, dozens of smaller communities also saw meaningful budget boosts.

Examples include:

  • Muskegon: $540,171.00

  • Mount Pleasant: $756,239.40

  • New Buffalo Township: $1,404,444.60

  • Jackson: $270,085.50

  • Portage: $378,119.70

Even a single retail license generates more than $54,000 annually — not insignificant for small-town budgets.

In many communities, these funds are used for infrastructure improvements, public safety, parks, or general fund support.

The law does not restrict how municipalities spend the money.

Indian Tribes Also Receive Distributions

The report also details distributions to tribal governments.

Four federally recognized tribes received both municipal and county-style payments totaling $864,273.60, based on eight qualifying licenses located on tribal lands

Total Statewide Impact

In total:

  • 238 municipalities and tribal units received payments.

  • 79 counties and tribal units received payments.

  • The combined distribution reached $93.77 million statewide

Since adult-use marijuana sales began in December 2019, local distributions have steadily increased as the number of retail licenses has grown.

The FY 2025 distribution reflects the continued expansion of Michigan’s marijuana retail footprint — even as wholesale pricing pressures and new tax debates continue within the industry.

The Policy Question Ahead

The distribution report highlights a broader policy issue now surfacing across Michigan.

Communities that initially opted out of adult-use marijuana are watching neighboring municipalities collect significant annual revenue.

As state lawmakers debate additional cannabis tax changes — including the recently implemented 24% wholesale tax on growers — local governments may re-evaluate whether opting out remains financially prudent.

For now, however, the formula is clear:

Allow retail marijuana businesses — and receive $54,017.10 per license.

Ban them — and receive nothing.

Full List Available

A complete list of all municipalities, counties and tribal governments receiving FY 2025 adult-use marijuana tax distributions is available through the Michigan Department of Treasury report.