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HomeMy WebLinkAboutFinally Adopt Ordinance No. 1811, establishing a cap of 21 on Medical Marijuana Storefronts.pdfStaff Report: Final Adoption of Ordinance 1811 Page 1 of 1 Commission Memorandum REPORT TO: Honorable Mayor and City Commission FROM: Greg Sullivan, City Attorney SUBJECT: Provisional Adoption of Ordinance 1811 Related to the Number of Medical Marijuana Storefront Businesses Authorized to Conduct Business Within the City of Bozeman. MEETING DATE: July 11, 2011 AGENDA ITEM TYPE: Consent. RECOMMENDATION: Finally adopt Ordinance 1811 establishing a cap of twenty one (21) on medical marijuana storefront businesses. BACKGROUND: On June 27, 2011, the City Commission preliminarily adopted Ordinance 1811 as suggested by staff but with two important changes: the cap on businesses would be set at the current number of approved storefront business licensee (21) and the cap would be continued for another year. The attached ordinance for final adoption reflects these changes. I attached the staff report from the June 27, 2011 meeting as additional background. UNRESOLVED ISSUES: None other than those identified in the June 27, 2011 memorandum. ALTERNATIVES: As suggested by the Commission. I have no suggested alternatives. FISCAL EFFECTS: None directly related to the adoption of this ordinance. Considerable staff time continues to be spent on monitoring medical marijuana use in the community and following changes to state law. After July 1, 2011 additional staff time will be spent monitoring compliance with the changes to state law. Attachments: · Ordinance 1811 for Final Adoption (showing changes from provisional adoption in yellow highlights). · Staff memorandum from June 27, 2011 hearing on provisional adoption. Report compiled on: June 30, 2011 142 Provisional Adoption ORDINANCE NO. 1811 Regarding Medical Marijuana Page 1 of 5 ORDINANCE NO. 1811 AN ORDINANCE OF THE CITY COMMISSION OF THE CITY OF BOZEMAN, MONTANA. AMENDING SECTION 5.06.020, BOZEMAN MUNICIPAL CODE RELATED TO THE NUMBER OF MEDICAL MARIJUANA STOREFRONT BUSINESSES AUTHORIZED TO CONDUCT BUSINESS WITHIN THE CITY OF BOZEMAN. NOW, THEREFORE, BE IT ORDAINED by the City Commission of the City of Bozeman, Montana, that: Section 1 That Section 5.06.020, BMC, shall be amended to read as follows: 5.06.020 License - Application - Fee – Change - Confidentiality. A. Business Licenses. In addition to complying with the requirements of Title 50, Chpt. 46, MCA, and 5.06.010.E Aany individual or entity desiring to conduct any transaction, use, or business regarding Medical Marijuana within the city of Bozeman must first submit and obtain approval for an application for a business license under this chapter from the Director of Finance and pay the fee(s) for such license(s) as established by this Title. An activity where a duly licensed medical doctor engages in the review of a person’s medical condition for purposes of recommending medical marijuana and who does not provide medical marijuana to a qualifying patient is not subject to these licensing requirements but may be subject to other requirements of this code. There shall be the following types of business licenses related to Medical Marijuana activities conducted in the City regardless of whether the Medical Marijuana is sold, bartered, exchanged, or gifted: 1. Storefront/Retail Locations: Any person or entity that provides a location other than the residence of the person’s or entity’s qualifying patient(s) where a transaction or use related to Medical Marijuana is engaged in for more than three (3) qualifying patients registered by the State of Montana to the applicant or the applicant’s employees or agents shall prior to engaging in such transaction or use obtain a Medical Marijuana Store Front license. As of August 25, 20110, t The maximum number of Medical Marijuana Store Front licenses shall be twenty one (210). The limitation on the maximum number of licenses under this subsection shall repeal automatically one-year after the effective date of this ordinance. 143 Provisional Adoption ORDINANCE NO. 1811 Regarding Medical Marijuana Page 2 of 5 2. Delivery: Any person or entity that delivers Medical Marijuana within the City to more than three (3) qualifying patients or another entity regardless of whether the Medical Marijuana is sold, bartered, exchanged, or gifted shall prior to engaging in such activity obtain a Medical Marijuana Delivery license. 3. Growing and/or Processing: Any person or entity that operates a facility for the purpose of growing and/or processing medical marijuana shall prior to engaging in such activity obtain a Medical Marijuana Grow License. A person or entity desiring to engage in an activity related to medical marijuana must obtain a separate license for each activity described above except a person or entity obtaining a Medical Marijuana Store Front license may also under said license deliver medical marijuana from that location without obtaining a separate Medical Marijuana Delivery license. B. An application under this chapter, in addition to the requirements of 5.04.060.B, shall include the following: 1. The name of all owners/principals of the business as applicable and the name of all agents, contractors or employees, if any; 2. Documentation demonstrating the applicant and all owners/principals, agents, contractors or employees, as applicable, that may be involved in transactions regarding Medical Marijuana within the city of Bozeman are registered with the State of Montana under Title 50, Chpt. 46, MCA, and are duly authorized by state law to acquire, possess, cultivate, manufacture, deliver, transfer, or transport Medical Marijuana; 3. A sworn statement signed by the applicant verifying the number of qualifying patients which name the applicant and any other owner/principal, agent, contractor, or employee of the applicant as the qualifying patient's caregiver. The number of qualifying patients to be included in the sworn statement shall include all patients who may be registered with a caregiver acting as an agent, contractor, employee or owner/principle of the applicant; 4. A statement addressing how the applicant will comply with the security requirement provisions of 5.06.040; and 5. Each applicant for a business license shall provide a detailed statement regarding the nature of activities related to Medical Marijuana for which the applicant is engaged in and the specific license(s) for which an application is being submitted. C. An individual or entity licensed under this chapter to conduct a transaction, use, or business related to Medical Marijuana must, within the time period described below, inform the Director of Finance of the occurrence of the following: (i) every 90 days, any change to the licensed individual or entity's number of registered qualifying patients (including those of a principal/owner, agent, contractor, or employee); and/or (ii) every 30 days, a change in the principals of the business or a change of agents, contractors or employees. If either of these conditions occur a new statement under 5.06.020.B.iii is required. Failure to inform the Director of Finance of the changes listed herein within the time periods described above shall be cause for revocation of the license pursuant to 5.04.170 and 5.04.180. 144 Provisional Adoption ORDINANCE NO. 1811 Regarding Medical Marijuana Page 3 of 5 D. An application for business license under this chapter is a public document except that the names of all agents, employees and/or contractors and the number of qualifying patients provided to the city in fulfillment of the requirements of this chapter are to be kept on a separate form and are to be considered confidential by the City unless disclosure is required by law. Nothing herein shall prevent a duly authorized agent of the city of Bozeman from sharing the information described in this section with other authorized city employees or other state or local law enforcement as necessary to perform official duties. E. An application for a business license under this chapter submitted prior to but not approved before August 25, 2010 shall not be subject to the limitation on the maximum number of licenses but shall be subject to all other provisions of this Title. Any application for a license submitted hereunder after August 25, 2010 shall be subject to the maximum allowable licenses and all other provisions of this Title. This chapter shall repeal automatically one-year after the effective date of this ordinance. F. A license issued under this chapter is not transferable and the provisions of 5.04.080 shall not apply. Section 2 Severability. That should any sentence, paragraph, subdivision, clause, phrase or section of this ordinance be adjudged or held to be unconstitutional, illegal, or invalid, the same shall not affect the validity of this ordinance as a whole, or any part or provision thereof, other than the part so decided to be invalid, illegal or unconstitutional, and shall not affect the validity of the Bozeman Municipal Code as a whole. Section 3 Savings Provision. This ordinance does not affect the rights or duties that matured, penalties and assessments that were incurred, or proceedings that began before the effective date of this ordinance except any application for a city zoning or business license not approved as of the effective date of this ordinance must comply with the terms of this ordinance prior to approval. Section 4 Codification Instruction. The provisions of Sections 1 shall be codified as appropriate in Titles 5 of the Bozeman Municipal Code, as amended. 145 Provisional Adoption ORDINANCE NO. 1811 Regarding Medical Marijuana Page 4 of 5 Section 5 Effective Date. The effective date of this ordinance is 30 days after passage on final reading. INITIALLY PASSED by the City Commission of the City of Bozeman, Montana, on first reading at a regular session held on the 27th day of June, 2011. ______________________________ JEFFREY K. KRAUSS Mayor ATTEST: _____________________________________ STACY ULMEN, CMC City Clerk APPROVED AS TO FORM: ______________________________ GREG SULLIVAN City Attorney 146 Provisional Adoption ORDINANCE NO. 1811 Regarding Medical Marijuana Page 5 of 5 FINALLY PASSED by the City Commission of the City of Bozeman, Montana, on initial reading at a regular session held on the 11th day of July, 2011. ______________________________ JEFFREY K. KRAUSS Mayor ATTEST: _____________________________________ STACY ULMEN, CMC City Clerk APPROVED AS TO FORM: ______________________________ GREG SULLIVAN City Attorney 147 Staff Report: Provisional Adoption of Ordinance 1811 Page 1 of 3 Commission Memorandum REPORT TO: Honorable Mayor and City Commission FROM: Greg Sullivan, City Attorney SUBJECT: Provisional Adoption of Ordinance 1811 Related to the Number of Medical Marijuana Storefront Businesses Authorized to Conduct Business Within the City of Bozeman. MEETING DATE: June 27, 2011 AGENDA ITEM TYPE: Action. RECOMMENDATION: Provisionally adopt Ordinance 1811 establishing a permanent cap of 20 on medical marijuana storefront businesses. BACKGROUND: When the City Commission adopted Ordinance 1786 last summer creating municipal code provisions related to medical marijuana business licensing and use, the Commission included a one-year cap of 20 on the number of storefront businesses authorized to conduct business within the city of Bozeman. Under the municipal code, this cap is set to automatically expire on August 25, 2011. I bring this ordinance before you for you to determine whether the cap should remain, be made permanent, or, at the Commission’s discretion, be extended for an additional year. As explained herein, my recommendation is to permanently set the cap at 20. The Bozeman Police Department and the Department of Planning and Community Development concur in this recommendation. Currently, the city of Bozeman has 211 medical marijuana storefront licensees. As the city business licenses are renewed at the beginning of the calendar year, these business licenses are valid for one-year contingent upon continued compliance with the municipal code requirements and state law. If one of these businesses should lose its license, go out of business, or fail to reapply, the city will not accept an application for a storefront business license. If, however, two or more licensees fail to maintain current status, the city will accept the next submitted application(s) for review. The Applicant must, of course, comply with all applicable provisions of state law including those of SB423. 1 Ordinance 1786 allowed all applications for city of Bozeman storefront business licenses submitted prior to the effective date of the ordinance to be reviewed and approved. Thus, the number exceeded the set cap of 20. 148 Staff Report: Provisional Adoption of Ordinance 1811 Page 2 of 3 The proposed change in Ordinance 1811 to subsection A of 5.06.020 is to restate in this section that all licensees must comply with the provisions of state law as stated in 5.06.010.E, BMC. UNRESOLVED ISSUES: As you know, there are numerous unresolved issues related to the commercial aspects of medical marijuana stemming from the 2011 Montana Legislature’s adoption of SB423. SB423 became law on May 13, 2011 with several provisions becoming effective at that time and the majority of the bill’s amendments to the Medical Marijuana Act to be effective on July 1, 2011. There are numerous changes to the Medical Marijuana Act that affect the city’s business licensing program yet the change that perhaps most critically impacts the city’s program is SB423’s requirement that a “provider” serve no more than three registered patients and cannot take any financial remuneration for doing so. See SB423, Sect. 5 (effective July 1, 2011). These requirements in SB423 remove “providers” from the city’s requirement to obtain a business license because these city licenses are only required when a person is engaged in a “transaction or use… for more than three (3) qualifying patients…” 5.06.020.A.1, 2, BMC. Considering the above, at this time I recommend the city of Bozeman refrain from engaging in a complete overhaul of the Bozeman Municipal Code provisions related to medical marijuana for two reasons. First, there are two current attempts to overturn SB423 including litigation in Montana district court in Lewis and Clark County and an attempt to suspend the implementation of the law through the referendum process. (For more information on both please see the links under the header “SB423 Monitoring: Montana Marijuana Act” at http://leg.mt.gov/css/Committees/Interim/2011-2012/Children-Family/Meeting- Documents/meetings.asp). The outcome of these efforts is unknown and I believe that should the city overhaul its municipal code provisions related to medical marijuana and one of these efforts succeed the city may find any such overhaul to conflict with the Commission’s purposes behind initial adoption of the city’s municipal code provisions during the summer of 2010. Second, the city’s municipal code does not provide protection from full compliance with state law as the city’s codes currently require all businesses who have a city business license to maintain compliance with all state laws (see 5.06.010.E, BMC). Thus, all city of Bozeman licensees are required by state law and also by the municipal code to be in full and continuing compliance with SB423. Failure to comply with state law can result in revocation of the business license, civil penalties, and possible criminal prosecution. As such, it is my recommendation to refrain from a whole scale reform of the city of Bozeman’s municipal code provisions related to medical marijuana until the attempts at overturning SB423 have run their course. ALTERNATIVES: Given the uncertainty of the future of medical marijuana in Montana, the Commission may wish to consider extending the cap on medical marijuana storefronts for an additional year (or other time period) rather than permanently limit the number at 20. Should the Commission decide to do so I offer the following as the amendment to 5.06.020.A.1: 149 Staff Report: Provisional Adoption of Ordinance 1811 Page 3 of 3 1. Storefront/Retail Locations: Any person or entity that provides a location other than the residence of the person’s or entity’s qualifying patient(s) where a transaction or use related to Medical Marijuana is engaged in for more than three (3) qualifying patients registered by the State of Montana to the applicant or the applicant’s employees or agents shall prior to engaging in such transaction or use obtain a Medical Marijuana Store Front license. As of August 25, 20110, the maximum number of Medical Marijuana Store Front licenses shall be twenty (20). The limitation on the maximum number of licenses under this subsection shall repeal automatically one-year after the effective date of this ordinance. The alternative amendment will continue the one-year limitation as it leaves the last sentence of the above subsection in place and only replaces the effective date. If the Commission desires to change the length of time for which the cap will be in place, the Commission will need to amend the reference to the phrase “one-year” as that phrase occurs in the last sentence of the subsection. FISCAL EFFECTS: None directly related to the adoption of this ordinance. Considerable staff time continues to be spent on monitoring medical marijuana use in the community and following changes to state law. After July 1, 2011 additional staff time will be spent monitoring compliance with the changes to state law. Attachments: · Ordinance 1811 for Provisional Adoption · Finally adopted Ordinance 1786 (signed version). · Senate Bill 423 Report compiled on: June 14, 2011 150