Now the haze clears: Question 4 poses hurdles to local land use regulation

Issue March/April 2017 By Brandon H. Moss

As the United States Supreme Court recognized, "[t]he power of local governments to zone and control land use is undoubtedly broad and its proper exercise is an essential aspect of achieving a satisfactory quality of life in both urban and rural communities." Schad v. Borough v. Mt. Ephraim, 452 U.S. 61, 68 (1981). Yet, Chapter 334 of the Acts of 2016 - entitled "The Regulation and Taxation of Marijuana Act," or commonly recognized as Ballot Question 4 from the recent 2016 election (and, for simplicity, is referred to as the act) - has the potential to sharply restrict local land use concerns, even as municipalities confront the hazy dilemmas emanating from creating a new "vice" industry in the commonwealth.

Over the past nine years, Massachusetts municipalities have faced a landscape of deregulation of the possession of marijuana within their borders, following a series of statewide ballot questions. First, at the 2008 election, Massachusetts voters approved a ballot question replacing criminal penalties with civil penalties for the possession of one ounce or less of marijuana. Then, four years later, at the 2012 election, Massachusetts voters approved a ballot question approving the medical use of marijuana, resulting in the licensing and establishment of registered marijuana dispensaries (also known as medical marijuana treatment centers, or RMDs).

Finally, at the 2016 election, Massachusetts voters went one step further, to allow for the production, distribution and use of marijuana for non-medical purposes. The act addresses local regulation, in part, through new Massachusetts General Laws Chapter 94G, Section 3, entitled "Local control." However, the consequences of the act are to potentially curtail the ability to locally regulate "marijuana establishments" - unless action is undertaken by the Legislature or the forthcoming Cannabis Control Commission.

It should be noted, however, that the act only deals with the legality of marijuana under state law. Marijuana remains a Schedule I drug, and possession is therefore prohibited under the federal Controlled Substances Act.

Local Land Use Considerations

The act is premised upon "a system that licenses, regulates and taxes the businesses involved in a manner similar to alcohol and to make marijuana legal for adults 21 years of age or older." See Act § 1. However, unlike establishments producing, processing or selling alcohol, Massachusetts General Laws Chapter 94G, Section 3 expressly restricts local regulation of the siting of "marijuana establishments," a term collectively referring to: (1) marijuana cultivators; (2) marijuana testing facilities; (3) marijuana product manufacturers; (4) marijuana retailers; and (5) other licensed marijuana-related businesses.

The act expressly allows municipalities to regulate the "time, place and manner" of marijuana establishments and business involved with marijuana accessories. See G.L.c. 94G, § 3(a)(1). A "time, place and manner" is the type of regulation applicable to constitutionally-protected activities, such as adult entertainment. Examples of "time, place and manner" regulations include restricting the hours of operation of a business or limiting the location of a business to a specified area. See, e.g. Nat'l Amusements, Inc. v. Town of Dedham, aff'd, 43 F.3d 731 (1st Cir. 1995) (regulating hours of operation); City of Renton v. Playtime, Theatres, Inc., 475 U.S. 41 (1986) (regulating locations).

The act also allows a municipality to: regulate licensed cultivation, processing and manufacturing that constitute a "public nuisance;" reasonably regulate public signage for marijuana establishments; and adopt a civil penalty if a person violates an ordinance or bylaw that is comparable to the penalty for violating an ordinance or by-law involving alcohol. See G.L.c. 94G, § 3(a)(3)-(5). However, municipal regulations cannot be "unreasonably impracticable," and cannot violate G.L.c. 94G (the chapter added by the act) or future regulations adopted by the commission.

However, there are two caveats to regulating the siting of marijuana establishments - as opposing to prohibiting or restricting such establishments in number, which are discussed below. First, the act requires parity between RMDs (which exist for the medical use of marijuana) and marijuana establishments. See G.L.c. 94G, § 3(a)(1). In that regard, marijuana establishments that cultivate, manufacture or sell marijuana or marijuana products must be allowed in the same areas where RMDs can conduct such activities. See id. Consequently, municipalities that already enacted zoning ordinances or bylaws may consider revising the location of their "marijuana zoning districts," lest a marijuana establishment potentially operate in the same area previously reserved for an RMD. In a similar vein, municipalities that have not already established a "marijuana zoning district" may have to account for both medical and non-medical marijuana businesses when they ultimately create such a zoning district in the future.

Second, the act contains a buffer zone requirement, prohibiting a marijuana establishment from being located within 500 feet of an established public or private school (which provides kindergarten or education in any of grades one through twelve). See G.L.c. 94G, § 5(b)(3). The act expressly authorizes a municipality to reduce this buffer zone requirement. See id.

However, the buffer zone requirements for recreational establishments are distinct from those applicable to RMDs. Unlike the act, the 2012 ballot question did not establish minimum or default buffer zone requirements for RMDs. Rather, the buffer zone requirements for RMDs are established by Department of Public Health (DPH) regulation. RMDs must comply with all local siting requirements - which are not necessarily limited to distances from preexisting public or private schools (i.e., the default buffer zone requirements under the act). See 105 CMR 725.110(A)(14). If a municipality has not enacted local siting requirements, then, as a default requirement, an RMD cannot be located within 500 feet of "a school, daycare center, or any facility in which children commonly congregate." See id. Indeed, the Massachusetts Land Court recently recognized the flexibility allowed to a municipality to enact local siting requirements for RMDs - but the language of the act casts doubt on whether similar flexibility exists for similar local regulation of marijuana establishments. See Little Children Schoolhouse, Inc. v. Town of Brookline Zoning Board of Appeals, No. 15 MISC 000518 KFS, 2016 WL 4162455 (Mass. Land Ct. Aug. 4, 2016).

The differences in default buffer zone requirements between the act (for marijuana establishments) and DPH regulation (for RMDs) create complexity and conflict in establishing local siting requirements. Specifically, the act is silent on the potential for local siting requirements - such as distances from residential and other sensitive uses - and on minimum buffer zone distances from daycare centers and facilities in which children commonly congregate (even though DPH regulations address the same). Given this disparity, municipalities may need to revisit or pay particular attention to the location and size of a zoning district in which marijuana establishments can operate - absent following procedures for prohibiting or restricting the number of marijuana establishments.

Among the four states that previously approved for recreational marijuana businesses prior to the 2016 election, three states had opt-out procedures for local governments (Washington, Oregon and Alaska), while one state (Colorado) utilized an opt-in procedure. Massachusetts has been added to the list of opt-out jurisdictions, albeit subject to a set of statutory procedures inconsistent with the manner in which legislation is generally adopted at the local level.

Notably, the act authorizes municipalities, using an ordinance or bylaw, to: (1) prohibit one or multiple categories of marijuana establishments from operating in the municipality; (2) restrict the total number of marijuana retailers (a category of marijuana establishments), to less than twenty percent of the number of off-premises alcohol licenses issued in the municipality; or (3) restrict the number of any category of marijuana establishments to less than the number of medical marijuana treatment centers authorized to conduct the same type of activity in the municipality. See G.L.c. 94G, § 3(a)(2). These types of ordinances or bylaws have the potential to severely limit or outright prohibit marijuana establishments in an opt-out municipality - if enacted "by a vote of the voters." This is separate from the initiative petition procedures required for on-site consumption at certain marijuana establishments. See G.L.c. 94G, § 3(b).

The phrase "by a vote of the voters" presents ambiguity and creates untoward debate - as opposed to uniformity - in regulation. Under Massachusetts law, ordinances and bylaws are generally adopted by the local legislative body (e.g., approval by town meeting or passage by a city or town council and signing by a mayor), not by the registered voters within the municipality. See, e.g. G.L.c. 40A, § 5 (involving requirements for enactment of zoning ordinances and bylaws). What this phrase means is open to a realm of possibilities, creating questions, among others, as to: whether a referendum vote in the municipality is required; whether a referendum vote, if required, can delegate action to the local legislative body or instead requires affirmative approval of a bylaw or ordinance; and whether, and to what extent, the local legislative body has a role in enacting an ordinance or bylaw or follows existing state law for adopting ordinances or bylaws.

This uncertainty in how a municipality can prohibit or restrict the number of marijuana establishments creates a ripe opportunity for legislative amendment to the act or clarification through commission regulation. Otherwise, there is a palpable risk that a would-be marijuana establishment may challenge the process undertaken by a municipality attempting to exercise its police powers to prohibit or limit marijuana establishments.

By comparison, the ballot question adopted in Alaska at its 2014 statewide election provides more clarity on the scope of local government authority than its Massachusetts counterpart. In that regard, Alaska Stat. § 17.38, stated that "[a] local government may prohibit the operation of marijuana cultivation facilities, marijuana product manufacturing facilities, marijuana testing facilities, or retail marijuana stores through the enactment of an ordinance or by a voter initiative." See Alaska Stat. § 17.38.110(a) (emphasis added). This process is similarly reflected in regulations adopted by the Alaska Marijuana Control Board. See 3 AAC 306.200. Thus, Alaska's ballot question and subsequent regulations contemplated action by either the local government or voter initiative - as opposed to the act, which muddies both mechanisms for Massachusetts.

Future Developments

While the state of the retail marijuana industry in Massachusetts continues to evolve, the operable deadlines under the act have been delayed by six months, because the Legislature enacted "An Act Further Regulating the Cultivation of Marijuana and Marihuana" near the end of the last legislative session. Appointments to the commission, charged with adopting and administering regulations and comprised of three members, must be made by September 1, 2017. In turn, the commission has until March 15, 2018 to adopt initial regulations, and the earliest that the commission can accept any applications is April 1, 2018. It remains within the realm of possibility that the Legislature or the commission will provide the necessary guidance for municipalities to make decisions to opt-out from the act before that time.

In the interim, municipalities may already be starting to act through moratoriums, much in the way that they did when the 2012 ballot question passed. See Office of the Attorney General Municipal Law Unit Case #8242 (approving marijuana establishment moratorium through June 30, 2018). For context, Massachusetts courts have sanctioned moratoriums, where "temporary and adopted to provide controlled development while the municipality engages in comprehensive planning studies." Sturges v. Town of Chilmark, 380 Mass. 246, 252-53 (1980); W.R. Grace & Co.-Conn. v. Cambridge City Council, 56 Mass. App. Ct. 559 (2002). Such planning studies may be necessary because the act: creates a new "vice" industry in Massachusetts; involves unknown risks to the public health, safety and welfare; presents new challenges in policing and enforcement; and requires time for municipalities to analyze and respond to future regulations and potential legislative amendments. Otherwise, municipalities will need to review and update their ordinances and bylaws in advance of the industry setting up its proverbial shop, barring a local opt-out from the act.

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