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Public Service Announcement: All marijuana businesses located in the City of Portland must obtain a City Marijuana Regulatory License (“City License”)

There has been so much buzz about the Oregon Liquor Control Commission’s (OLCC) licensing process that many have overlooked the City of Portland’s licensing process.  However, if you are located within the City limits, you will need both licenses to operate.  Here are some steps you should take if you think you might be affected.

1.  Check to see that you are located within the City’s limits. A map showing the City’s limits is available here: https://www.portlandoregon.gov/bps/article/51672.

2.  Consider whether you are an affected business. All marijuana businesses must obtain a City License. This includes medical dispensaries licensed by the Oregon Health Authority (OHA). It also includes retailers, wholesalers, producers and processors who will be licensed by the OLCC.

3. Learn about the City’s requirements for obtaining a City License. We want to highlight a few key points:

  • A City License will not be granted to any medical dispensary or OLCC-licensed retailer that is within 1,000 feet of another medical dispensary or OLCC-licensed retailer.
  • The City’s license application review process will consider whether or not your proposed business is allowable under the City’s zoning code. You can do a preliminary review yourself by verifying your zoning code and reviewing the allowable uses in that zoning code. For more information you should consult a land use attorney.
  • Medical dispensaries must waive confidentiality with the OHA to apply for a City License.
  • Medical dispensaries and OLCC-licensed retailer applicants must pay a $975 application fee, and all other applicants must pay a $500 application fee. This fee is non-refundable.
  • Once licensed, OLCC-licensed retailers must pay a $4,175 licensing fee, and all other licensees must pay a $2,000 licensing fee.
  • A City License is valid for a period of one year and must be renewed annually.

The portion of the City’s code that addresses this licensing procedure, chapter 14B.130, is available here: http://www.portlandonline.com/auditor/index.cfm?c=69071.  Please note that this version of the chapter does not yet reflect recently adopted amendments.  To locate those amendments you should visit the City’s Pending Code Changes website: http://www.portlandonline.com/auditor/index.cfm?c=26653&a=23682.

 4.  Know if you qualify as a “grandfathered” dispensary. Grandfathered dispensaries are those dispensaries that meet either of the following criteria:

  • They (1) have been registered, operating and in good standing with the OHA since on or before July 1, 2015, (2) had a valid City of Portland Business License (i.e., tax registration) on or before July 1, 2015, (3) have no outstanding compliance issues pending with the OHA, (4) have not applied for or obtained another license to be a retailer within 1,000 feet of its proposed location, and (5) meet all other requirements in P.C.C. 14B.130.
  • They (1) have been registered and in good standing with the OHA since on or before September 30, 2015, (2) can demonstrate that they have incurred significant financial obligations prior to that date, using proof of a lease, hired employees, or investment in fixtures, (3) had a valid City of Portland Business License (i.e., tax registration) on or before September 30, 2015, (4) have no outstanding compliance issues pending with the OHA, (5) have not applied for or obtained another license to be a retailer within 1,000 feet of its proposed location, and (6) meet all other requirements in P.C.C. 14B.130.

5.  Be prepared to apply. The City will begin scheduling meetings to accept applications on December 1st. “Grandfathered” medical dispensaries can log on to the City’s website today to request a meeting.  Applicants seeking licensure as OLCC-licensed wholesalers, producers and processors can sign up for an intake meeting next Monday, November 23rd. Dispensaries and retailers that do not qualify as “grandfathered” dispensaries must also wait until next Monday, November 23rd, to sign up for an intake meeting; these businesses will be entered into a pool that closes on December 11th, and intake meetings will then be assigned to those in the pool on a random basis. Dispensaries and retailers that do not qualify as “grandfathered” dispensaries are subject to this drawing process because they are subject to the city’s 1,000 foot buffer, as mentioned above.

Log on to the City’s Marijuana Policy Program website for more information about the City’s application procedures, and to request a licensing meeting with the City’s staff: https://www.portlandoregon.gov/ONI/67575

You can also call the City’s hotline, at (503) 823-WEED (9333) with any questions.

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The City of Gresham has been relatively opposed to allowing medical marijuana dispensaries to open within their limits. While located in a friendly county, Gresham has taken their time in determining how they were going address the ending of the 1531 moratorium. Even though Gresham voted in favor of 91, decisions around time, place and manner have been slow to come. Earlier this week they took a final vote and weed is finally coming (hasn’t it been there all along?) to Gresham.

Click here to view the map of permitted zones and the red-lined ordinance.

Here are the parameters:

– $250 to apply for a business license

– $5000.00 application fee and renewal fee paid on top of the $4000.00 required by OHA. These fees are non-refundable.

– All employees, not just the PRF will be subject to a background check.

– Only allowable zoning is commercial, industrial and mixed-use. However, if that zoning also has residential use then a dispensary is disallowed. See map above.

– The city will perform their own inspections on facilities above and beyond the OHA inspections. THIS MAY INCLUDE YOUR BOOKS AND RECORDS and whatever else they come up with.

– There are insurance and indemnification requirements.

– There will be lighting and waste requirements.

– Home occupation is prohibited. I will address this in a later blog post. This really is aimed at cultivation which is also addressed in this legislation.

– Gresham intends to do a deep dive into the owners and funders of facilities. They are requiring disclosure not only of the PRF but of all owners and funders- including lenders. Additionally Gresham wants to know who owns the real property being used.

– They will be asking for a business plan type disclosure. Gresham wants to know exactly what you plan to sell and how those products are cultivated or produced.

– They will require a plan to control odor prepared by a design specialist.

There is much more buried in the legislation so please feel free to call us with further questions. That being said, I consider this a NO. While Gresham is a prime spot for a dispensary and for indoor cultivation, this city should be a wait and see for entrepreneurs. The legislation is reactionary and intrusive. They want too much access and it is far too invasive (who knows who will be doing the training for inspectors or what kind of broad discretion they might have). As a criminal lawyer I never feel very good about having so much information gathering happening without a warrant or true good cause.

Finally, because we are not sure what the Oregon Legislature is going to do this session, or OLCC will do during rule-making, it is very possible that a disclosure made in this process could be prohibitive for getting a recreational license. And, there is really no guarantee that Gresham will even allow recreational stores to operate.

(I will be writing another post about cultivation in Gresham which is significantly addressed in the legislation as well)

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The Oregonian did a round-up of the Clackamas marijuana regulations pertaining to medical marijuana facilities now that May 1st has passed. Last February, during the supplemental session, HB 1531 allowed local governments to impose moratoriums on dispensaries until May 1st, 2015. Many people in the cannabis industry are interested in what actions Clakamas county and cities in Clackamas county, have taken as the deadline has passed. The interest lies not just in understanding where a facility may open. Cultivators, processors and potential participants also wonder if these decisions might be reflective of what is to come for regulating the rest of the medical cannabis industry as well as the recreational program.

We would caution not to extrapolate too much from these decisions. There are many months of the Oregon legislative session left and local preemption (not allowing cites and counties to make aggressive individual decisions) is an issue on the table.

Click here for a link to the entire Oregonian article and a summary is below.

Oregon City: No, indefinitely. Any dispensary trying to open in Oregon City would need a business license, and the city passed an ordinance in 2012 stating that no license shall be issued to any business prohibited by local, state or federal law.

West Linn: No, indefinitely. Without taking a vote, West Linn city councilors agreed on April 20 to support existing business license regulations similar to Wilsonville’s that disallow licensing medical marijuana dispensaries as long as they violate federal law.

Wilsonville: No, indefinitely. Like Oregon City and West Linn, Wilsonville is relying on business license limitations to prohibit medical marijuana dispensaries. However, the city took an extra step to send a clear message that dispensaries can’t locate there.

Milwaukie: Yes, conditionally. Of the five most populous cities in Clackamas County, Milwaukie is the only one to regulate, rather than ban, medical marijuana dispensaries.

Lake Oswego: No, not this year. Lake Oswego city councilors on April 21 passed an ordinance prohibiting medical marijuana dispensaries from locating in the city for another year.

Based on these individual jurisdictional decisions it is clear that many parts of Clackamas county have approached regulating medical marijuana dispensaries with an eye towards how to prohibit them and not to accommodate. Many of these decisions go far beyond just time, place and manner. We are assuming that a number of these jurisdictions may wind up in litigation.

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