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Will the Municipal Opt-Out Kill the MRTA’s Buzz?Cannabis Law

On March 31, 2021, New York State became the 17th state to legalize adult-use recreational marijuana through the enactment of the Marijuana Regulation and Taxation Act (“MRTA”). Many are taking a budding interest in legalization and are looking to enter the market, whether merely as a consumer or as a commercial adult-use recreational marijuana licensee. But the municipal power to “opt-out” of hosting retail dispensaries and/or public consumption facilities within the municipal borders threatens to be a buzzkill. Just what is concerning municipalities? And how can the public get involved?

Marissa Weiss, Esq., an associate attorney at the Walden-based firm Jacobowitz & Gubits, offers some guidance regarding the municipal opt-out power and how the public can get involved in the discussion.

1. The “Opt-Out” Authorization

The MRTA establishes a licensing and taxation system for recreational marijuana sales, which includes 11 types of adult-use licenses, in addition to the existing cannabinoid hemp and medical marijuana licenses, all of which require the state (under the newly created Office of Cannabis Management, “OCM”) to prepare regulations governing said licenses. Cities, towns, and villages are now authorized to “opt-out” of allowing adult-use cannabis retail dispensaries and/or public consumption facilities (think cannabis bars) from locating within their municipal jurisdictions. “Opting-out” means that the municipality makes the decision to prohibit dispensaries or public consumption facilities from locating within its municipal borders—once this is done, the OCM is prohibited from issuing a license for a facility to locate in that municipality. The caveat is that a municipality must pass a local law no later than December 31, 2021 in order to “opt-out”.

Although there is much confusion over the opt-out, municipalities cannot opt-out of any other type of license or out of adult-use marijuana legalization generally, as the MRTA legalized statewide consumption and cultivation of the plant.

2. How to Get Involved

Many residents are concerned that their municipality will choose to opt-out (or opt-in!) without constituent consultation. Although the December deadline seems far away, concerned citizens should be speaking now with their municipal legislative boards to understand where the municipality stands on the topic. If you are pro-dispensary and public consumption facilities, you will want to stress the local socioeconomic benefits of opting-in, as municipalities who opt-in will receive 3% of the tax from adult-use recreational sales. Conversely, if you are anti-dispensary and public consumption facilities, you should catalogue specific reasons why your municipality would be detrimentally impacted by the inclusion of such facilities within its borders.
Residents should note that if their municipality decides to opt-in, residents still have the ability to put together a petition and force a local referendum on the pending opt-out law. However, the referendum is not required so concerned citizens should delve into the weeds by participating in the local legislative process so they are aware of what is going on in their municipality.
In addition, even if a municipality opts-in, there is opportunity for the public to participate in the municipality’s potential adoption of reasonable “time, place, and manner” zoning restrictions upon dispensaries and public consumption facilities. Finally, the state’s siting of any facilities within the municipality requires notification to that municipality, which is another process by which residents can voice their opinions on cannabis retail facility siting.

While it may seem that municipalities wield all the power when it comes to the MRTA, the public has the chance to pipe up and make their opinions known. The MRTA envisions a joint effort among municipal officials and their constituents in determining whether to opt-in or out—the public must merely get involved now so that they do not get left high and dry.

This is not intended to be legal advice.  You should contact an attorney for advice regarding your specific situation.

A shortened version of this blog appeared in the June 12, 2021 edition of Chronogram Magazine on-line.

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Marissa G. Weisis an Associate with the firm and practices Environmental Law, Land Use and Municipal Law.

law in addition to Cannabis and Hemp Law.  She can be reached by phone at 845-764-9656 and by email.[/column]

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