'You Won't Pay It. We Will.' Seven Months Later, Higher Love Closed Five of Its Nine U.P. Stores

On Sunday, August 9, the Higher Love Cannabis Co. store at 421 North Lincoln Road in Escanaba, Michigan, in the building that used to be a Staples, filled its last orders. So did four other Higher Love dispensaries scattered across the Upper Peninsula: Crystal Falls, Houghton, Munising and Ontonagon. By Monday morning a sign on the Escanaba door announced the closure, and the Marquette-based company put out a press release that used the word "unfortunate" in its first sentence. (S1, S2, S3)

Seven months earlier, the company had made a promise. On January 7, a week after Michigan's new 24% wholesale tax on adult-use cannabis took effect, Higher Love published a note to customers under the headline "Higher Love's Promise to You." It explained that the tax landed at the wholesale level, that such costs typically roll downhill to retailers and then to customers, and that Higher Love would do things differently: it had restocked ahead of the tax, leaned on its vendors, and would absorb the rest itself. The note ended in bold. "You won't pay it. We will." As of this week, the company's homepage still carries the banner "We Pay the 24% Wholesale Tax" with the tagline "So You Don't Have To." (S4, S5)

Crystal Falls, at 116 Superior Avenue, was the company's first store when it opened in February 2021. Escanaba opened in April 2025. Higher Love's president, Joni Moore, a plant scientist and caregiver, told local press at the 2023 opening of the Norway store that the "cooperative Yooper spirit" was what drew the company to small towns. Now five of those towns are down a dispensary, and the closed locations will sit on "active" licenses until the company's permits come up for renewal in February 2027. (S2, S6, S7)

Higher Love is one small chain in a state with 836 licensed adult-use retailers, and its five closures will not move Michigan's sales numbers. But the company is the clearest case yet of what the industry warned would happen when Gov. Gretchen Whitmer and legislative leaders bolted a 24% wholesale excise tax onto the country's second-largest adult-use market to pay for roads. The tax took effect January 1. It was supposed to raise roughly $420 million a year. Through April 30 it had brought in just under $34 million, less than a third of the quarterly target, while the average retail price of an ounce of flower in Michigan fell to $58.18 in June, the lowest figure the state's Cannabis Regulatory Agency has ever recorded. (S7, S8, S9)

That combination, a new tax layered on a collapsing price, is why Higher Love's rural stores went first. "While these taxes apply at different stages of the supply chain and do not constitute a single combined tax rate, their collective impact has created an increasingly unsustainable operating environment, particularly for compliant businesses serving smaller and rural communities," the company said in its release. (S3)

The tax came out of a budget standoff. In the fall of 2025, House Bill 4951, the Comprehensive Road Funding Tax Act, became part of an $81 billion budget deal among Whitmer, Republican House Speaker Matt Hall and Democratic Senate Majority Leader Winnie Brinks. The Senate passed it 19-17 in October. The nonpartisan House Fiscal Agency estimated the levy would generate about $420 million a year for road and bridge repair, roughly $105 million a quarter. It is charged when a grower first sells or transfers product to a retailer, on top of the 10% retail excise tax and 6% sales tax that Michigan voters approved in 2018. (S6, S10, S8, S11)

The Michigan Cannabis Industry Association sued almost immediately. On December 8, Court of Claims Judge Sima G. Patel declined to block the tax before it took effect and dismissed the association's arguments that the Legislature needed a three-fourths supermajority to amend the voter-passed marijuana law. But Patel let one claim survive: whether a 24% wholesale tax "contravenes the purposes" of the 2018 initiative, which the association's executive director, Robin Schneider, swore in an affidavit was drafted with a deliberately low 10% rate to pull buyers out of the illicit market. Patel ruled that was a question of fact requiring discovery, and this year she refused the state's request to reconsider. The case is headed to trial. (S12, S10, S8)

Meanwhile the price kept falling. The CRA counted 939 active cultivation licenses on June 30, down from 1,016 a year earlier, and nearly 2 million pounds of adult-use flower sitting in the state's inventory, enough to cover consumer demand for about 18 months. Of that, 659,342 pounds of flower and 635,668 pounds of fresh-frozen sat at processors, about 184,000 pounds at retailers, and roughly 477,000 pounds at grow sites. Dispensaries are on pace to sell more than 1.3 million pounds this year, about the same as 2025, but for less money: statewide sales peaked near $3.3 billion in 2024, slipped 3.4% to just under $3.2 billion in 2025, and are tracking toward a further 6.4% decline, below $3 billion, in 2026. (S7)

Because the wholesale tax is charged on the transfer price rather than the shelf price, it behaves like a fixed cost that growers and retailers have been eating rather than passing along. The CRA's own data suggests as much: if consumers were paying the tax, the average ounce would have gone up in January. It went down, to $59.07, and kept drifting lower through June. Michigan's Treasury now pegs the average wholesale price of flower at $641.41 a pound for the quarter that began July 1. Lansing City Pulse columnist Chris Silva wrote in late July that pound prices which once fetched $1,500 to $2,000 have "crashed to $400 or less." (S7, S10, S13, S11)

The tax did not start the downturn, and that complicates Higher Love's framing. Michigan's adult-use sales were already below year-ago levels before January, and Hirsh Jain, founder of the Los Angeles consulting firm Ananda Strategy and an instructor at Oaksterdam University, told Detroit's Metro Times this month that the tax accelerated a slide that predated it. "There is a long list of companies that have gone out of business, and many cited the wholesale tax," Jain said. Recreational sales for the first six months of 2026 came in around $1.48 billion, down from $1.57 billion a year earlier and $1.62 billion in 2024. (S14)

Schneider has been blunt about who she thinks is responsible. "Our elected leaders made the cannabis industry a sacrificial lamb in order to have the illusion of a road funding fix," she told The Detroit News after the first-quarter collections came in. "In reality, the only thing they have accomplished is the decimation of a strong industry that served as an economic driver for this state. The result is business closures, jobs lost and tax revenue taken away from local governments." (S8, S9)

“Our elected leaders made the cannabis industry a sacrificial lamb in order to have the illusion of a road funding fix.”

— Robin Schneider, Executive Director, Michigan Cannabis Industry Association

In Lansing, repeal has bipartisan sponsors but no hearing. Sen. Jonathan Lindsey, a Coldwater Republican, filed Senate Bill 810 on February 26 with four other Republicans and three Democrats, including Sen. Rosemary Bayer of West Bloomfield, who had voted for the tax in October. "This tax will also damage Michigan businesses and lead to widespread job losses across the state, which are already being reported," Lindsey said when he introduced it. "I also don't believe that in the long term this mechanism will generate the expected revenue, especially if sales go down as a result of the increased taxes or if legal challenges against the tax prevail." The bill was referred to the Senate Government Operations Committee, where it has sat for six months. (S15, S10, S7)

The Whitmer administration has not backed away from the levy, which remains the funding mechanism for the Neighborhood Road Fund, and it has released only a heavily redacted version of a CRA memo assessing the tax's likely effects, according to Lansing television station WLNS. Judge Patel's ruling also cut against the industry on its central legal theory: the Legislature, she found, did not need a supermajority to add the tax. What is left to litigate is whether the tax undermines the purpose of legalization, a harder case to win. (S8, S12)

There is a harder-nosed reading of Higher Love's retreat, too. Silva argued in City Pulse that the Michigan operators still standing are the ones with "a reason to exist beyond being a place to buy cheap weed," and that those who tried to compete with the big chains on price alone "largely did not make it." Higher Love's homepage describes the company as "Your Low Price Leader." A chain that promised to eat a 24% tax in a $58-an-ounce market was, in effect, betting that volume in towns of a few thousand people could cover it. (S11, S5)

1. Michigan Treasury's next quarterly wholesale-tax report, covering May through July, will show whether collections are tracking any closer to the $105 million-a-quarter projection.
2. The Court of Claims case, Michigan Cannabis Industry Association v. State of Michigan, proceeds to discovery and trial on the surviving claim; no trial date has been set.
3. Senate Bill 810, the bipartisan repeal bill, remains in the Senate Government Operations Committee with no hearing scheduled.
4. February 2027: Higher Love's licenses for the five closed stores come up for renewal.

What remains of Higher Love is four stores, in Ironwood, Marquette, Menominee and Norway, plus the cultivation operation in Republic, in Marquette County, whose Ottawa Innovations grow was the first in the Upper Peninsula to earn Clean Green certification. The Menominee store is one of the closest legal options for adults driving up from Green Bay, Wisconsin. Munising, which Metro Times this month named one of the best dispensaries in the state worth a road trip, was the first retail cannabis storefront in a city of just under 2,000 people. It is closed. (S6, S16, S7, S14, S17)

The company says its four continuing locations "will remain the foundation for the company's next chapter." The January promise is still on the website, in bold: "You won't pay it. We will." For five towns in the Upper Peninsula, the bill came due on a Sunday in August. (S3, S4)

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