Memorandum 15-043 Marijuana Regulations

Memorandum 15-043

To:

homer city council

homer city manager

From:

holly c. wells

re:

REGULATION OF MARIJUANA IN THE CITY OF HOMER, ALASKA

CLIENT:

CITY OF HOMER

FILE NO.:

506742.23

Date:

March 18, 2015

               On November 4, 2014, the Alaskan voters approved Ballot Measure 2, which was an act to tax and regulate the production, sale, and use of marijuana. Effective February 24, 2015, the provisions of this ballot measure were enacted into law as Chapter 38 of Section 17 of the Alaska Statutes.

               At the state level, the Alcoholic Beverage Control Board (“ABC Board”) is currently responsible for the creation of regulations necessary for the chapter’s implementation.[1] These include the adoption of regulations regarding marijuana establishment registrations, labeling requirements, restrictions on advertising, and civil penalties for the failure to comply with regulations.[2] However, the Board may not prohibit the operation of marijuana establishments altogether, “either expressly or through regulations that make their operation unreasonably impracticable.”[3]

               Alaska Statute 17.38.110, on the other hand, similarly grants authority to local governments to enact ordinances regulating the sale and distribution of marijuana; for instance, it authorizes a local government to establish a schedule of annual operating, registration, and application fees for marijuana establishments,[4] the power to adopt civil penalties for violation of local ordinances,[5] and the authority to consider certain registrations in the event the ABC Board fails to adopt regulations pursuant to AS 17.38.090.[6] Importantly, it also expressly authorizes local governments the option of “prohibit[ing] the operation of marijuana cultivation facilities, marijuana product manufacturing facilities, marijuana testing facilities, or retail marijuana stores within their boundaries through enactment of an ordinance or by a voter initiative.”[7] Finally, AS 17.38.110 authorizes a local government “to designate a local regulatory authority that is responsible for processing applications submitted for a registration to operate a marijuana establishment within the boundaries of the local government.”[8] If a local government has such regulatory authority, the ABC Board is required to forward a copy of any marijuana establishment application it receives within that local government’s domain, along with half of the application fee, to the authority.[9]

Currently, there is significant uncertainty surrounding the laws and regulations that will ultimately govern marijuana use and distribution within the State of Alaska.  As a  result, the City is best served by establishing a body that has the authority to carefully consider current and pending laws and policies and recommend comprehensive regulations.  Accordingly, Ordinance 15-______ adopts Chapter 2.78, which establishes the City of Homer Marijuana Advisory Commission (“Commission”) to review and weigh the City of Homer’s options in order to determine what, if any, local restrictions will be the most beneficial to the City’s health and welfare, and to review future marijuana establishment applications sent by the ABC Board. Some examples of other local government regulations, ordinances, and actions include the following:

Ordinances making it illegal to consume marijuana in a public place (Municipality of Anchorage, City of North Pole, City of Palmer, City and Borough of Wrangell)
Ordinances imposing a limited moratorium through on the receipt or processing of applications, permits or pending approvals pertaining to marijuana establishments. (City and Borough of Juneau, City of Craig)
Ordinances amending the second-hand smoke control code to regulate the use of marijuana (no smoking in public places). (City and Borough of Juneau)

Commissioning of a task force task force to develop zoning standards, production and sales requirements, and determine what other use issues need to be considered for adoption by the assembly. (Fairbanks North Star Borough)[10]

Ordinances defining a “public place.” (City of North Pole)

In the event Ordinance 15-07 is adopted by Council, our firm is preparing materials and memoranda for the Commission that will provide the resources necessary to draft its recommendations and weigh the above identified options.

[1] The ABC Board must adopt these regulations not later than nine months after February 24, 2015. AS 17.38.090. Chapter 38 also authorizes the legislature to create a Marijuana Control Board in the Department of Commerce, Community, and Economic Development to assume the power, duties, and responsibilities delegated to the Alcoholic Beverage Control Board under the chapter. AS 17.38.080

[2] See AS 17.38.090.

[3] AS 17.38.090(a).

[4] AS 17.38.110(d)

[5] AS 17.38.110(b)

[6] AS 17.38.110(c) and (f).

[7] See AS 17.38.110(a).

[8] AS 17.38.110(c).

[9] AS 17.38.100(c). In the event that a local government has enacted a numerical limit on the number of marijuana establishments and the ABC Board receives a greater number of applications than that limit, the ABC Board is required to solicit and consider input from the local regulatory authority as to the local government’s preference.

[10] AS 17.38.040 makes it unlawful to consume marijuana “in public.”