HomeMy WebLinkAboutItem 06 Business License Regulations for Recreational Marijuana Businesses AGENDA ITEM SUMMARY Meeting Date: 5/16/2016
Meeting Type: Regular Meeting
Staff Contact/Dept.: Mary Bridget Smith, CAO
Staff Phone No: 541-746-9621 Estimated Time: Consent Calendar
S P R I N G F I E L D
C I T Y C O U N C I L
Council Goals: Enhance Public Safety
ITEM TITLE: BUSINESS LICENSE REGULATIONS FOR RECREATIONAL MARIJUANA BUSINESSES
ACTION REQUESTED:
Adopt/not adopt the following ordinance: AN ORDINANCE ADDING SECTIONS
7.1100-7.1104 TO CHAPTER 7 OF THE SPRINGFIELD MUNICIPAL
REGARDING RECREATIONAL MARIJUANA BUSINESSES.
ISSUE STATEMENT:
Under House Bill 3400 (2015), local governments may pass ordinances relating to
and governing the production, use, sale, and licensing of recreational marijuana.
The city seeks to adopt reasonable regulations governing recreational marijuana businesses in the City of Springfield.
ATTACHMENTS: Attachment 1 – Proposed Ordinance Attachment 2 – Attachment 1 to the Proposed Ordinance (proposed code language
for SMC 7.1100-7.1104)
DISCUSSION/ FINANCIAL IMPACT:
Council is in the process of considering development code amendments adopting land use regulations for medical and recreational marijuana businesses. Medical
marijuana dispensaries are currently required to obtain a business license from the City under SMC 7.600 et seq, but there is no such requirement for recreational marijuana businesses. City staff would prefer that recreational marijuana business
regulations be adopted at the same time as the associated land use regulations in order to prevent a gap during which these businesses are allowed under the development code but not regulated by the municipal code.
The attached ordinance is modeled after the medical marijuana dispensary
regulations, with modifications as appropriate under state law for recreational
marijuana businesses. The first reading and public hearing for this ordinance was held on March 21, 2016.
The ordinance accomplishes the following:
• Creates definitions for regulation
• Requires recreational marijuana businesses to obtain a business license, pay
a fee and abide by adopted regulations; creates separate licenses and fees for retail and non-retail businesses (i.e. processors, producers, wholesalers).
• Requires all employees to undergo a background check
• New recreational marijuana businesses shall locate in accordance with state
regulations and local zoning regulations
• Precludes minors on site except where allowed under state regulations.
• Requires compliance with the City sign ordinance
• Requires compliance with the City alarm code (alarm systems are required
under OLCC regulation)
• Sets hours of operation (consistent with OLCC regulations for retail sales).
• Precludes free distribution
• Precludes public consumption on site.
ORDINANCE NO. _______________
AN ORDINANCE ADDING SECTIONS 7.1100-7.1104 TO CHAPTER 7 OF THE
SPRINGFIELD MUNICIPAL REGARDING RECREATIONAL MARIJUANA
BUSINESSES
The City Council of the City of Springfield finds that:
WHEREAS, in 2014, Oregon voters passed Ballot Measure 91, which allowed adults 21
and older to use, grow, process, and sell limited amounts of marijuana for recreational
purposes;
WHEREAS, in 2015, the Oregon Legislature passed House Bill 3400, which created a
regulatory and licensing scheme for the licensing, production, processing, and sale of
recreational marijuana and cannabinoid products;
WHEREAS, under House Bill 3400, the City of Springfield may pass ordinances relating
to and governing the production, use, sale and licensing of recreational marijuana
pursuant to state law;
WHEREAS, these regulations are adopted through the City of Springfield’s broad home
rule authority under the Chapter II of Springfield City Charter which provides the
following:
Section 4. Powers of the City. The City has all powers that the constitutions,
statutes and common law of the United States and of the State of Oregon now
or hereafter expressly or impliedly granted or allowed the City, as fully as though
this Charter specifically enumerated each of those powers.
Section 5. Construction of Powers. In this Charter no specification of power
is exclusive or restricts authority that the City would have if the power were not
specified. The Charter shall be liberally construed, so that the City may exercise
as fully as possible all powers possible for it under this Charter and under United
States and Oregon law. A power of the City continues unless the grant of the
power clearly indicates the contrary.
WHEREAS, recreational marijuana is a new industry and the City of Springfield seeks to
develop local regulations that will protect public health and safety; and
WHEREAS, the City Council desires to regulate recreational marijuana facilities to ensure
that such businesses are compatible with existing businesses and neighborhoods, and
that they operate in a manner that considers the potential impacts on law enforcement,
other businesses, and livability in the community, while simultaneously allowing
legitimate business practices in accordance with the will of City residents and voters.
Attachment 1, Page 1 of 2
NOW THEREFORE THE CITY OF SPRINGFIELD ORDAINS AS FOLLOWS:
Section 1. Chapter 7 BUSINESS of the Springfield Municipal Code is hereby
amended to include Sections 7.1100 through 7.1104 addressing recreational marijuana
facilities as more particularly described and set forth in Attachment 1 attached hereto
and incorporated herein by reference.
Section 2. Except as specifically amended herein, Chapter 7 shall continue in full
force and effect.
Section 3. Section 7.1104 provides for a retail and non-retail business licenses
with fees to be set by Council resolution.
Section 4. Severability Clause. If any section, subsection, sentence, clause,
phrase or portion of this Ordinance is, for any reason, held invalid or unconstitutional by
a court of competent jurisdiction, such portion shall be deemed a separate, distinct and
individual provision and such holding shall not affect the validity of the remaining portion
hereof.
Section 5. Effective Date of Ordinance. This Ordinance shall take effect 30 days
after its adoption by the Council and approval by the Mayor.
ADOPTED by the Common Council of the City of Springfield this ______ day of
March, 2016, by a vote of ______ for and ______ against.
APPROVED by the Mayor of the City of Springfield this ______ day of March,
2016.
_______________________________
Mayor
ATTEST:
_______________________________
City Recorder
Attachment 1, Page 2 of 2
Ordinance Attachment 1
7.1100 Purpose.
To protect the public from unlawful use and sale of recreational marijuana. All recreational
marijuana sales shall be administered in accordance with the provisions of HB 3400, ORS
Chapter 475, and all applicable Oregon Administrative Regulations. Registration or licensing by
the Oregon Liquor Control Commission (OLCC) is not a guarantee that any recreational
marijuana business will be permitted to operate in the City of Springfield.
These regulations set forth by the Springfield Municipal Code provide reasonable regulations to
supplement the rules promulgated by OLCC. These regulations are intended to address solely
the issue of producing, processing, transporting, selling, testing, or delivering marijuana for
commercial recreational use. These regulations do not address and shall not be applied to any
medical or other use of marijuana that does not relate to the authorized use under Oregon’s
existing Medical Marijuana Act.
7. 1101 Definitions
Cannabinoid means any of the chemical compounds that are the active constituents of
marijuana.
Cannabinoid concentrate means a substance obtained by separating cannabinoids from
marijuana by: (a) a mechanical extraction process; (b) a chemical extraction process using a
nonhydrocarbon-based or other solvent, such as water, vegetable glycerin, vegetable oils,
animal fats, isopropyl alcohol or ethanol; or (c) A chemical extraction process using the
hydrocarbon-based solvent carbon dioxide, provided that the process does not involve the use
of high heat or pressure.
Cannabinoid edible means food or potable liquid into which a cannabinoid concentrate,
cannabinoid extract or dried marijuana leaves or flowers have been incorporated.
Cannabinoid extract means a substance obtained by separating cannabinoids from marijuana
by: (a) a chemical extraction process using a hydrocarbon-based solvent, such as butane,
hexane or propane; (b) a chemical extraction process using the hydrocarbon-based solvent
carbon dioxide, if the process uses high heat or pressure; or (c) any other process identified by
law.
Cannabinoid product means a cannabinoid edible and any other product intended for human
consumption or use, including a product intended to be applied to the skin or hair, that contains
cannabinoids or dried marijuana leaves or flowers. “Cannabinoid product” does not include (a)
usable marijuana by itself; (b) a cannabinoid concentrate by itself; (c) a cannabinoid extract by
itself; or (d) industrial hemp, as defined in ORS 571.300.
Consumer means a person who purchases, acquires, owns, holds, or uses marijuana items
other than for the purpose of resale.
License means a license issued pursuant to Springfield Municipal Code sections 7.000 to 7.006.
Attachment 2, Page 1 of 5
Ordinance Attachment 1
Marijuana means all parts of the plant of the Cannabis genera of the family Cannabaceae,
whether growing or not; the resin extracted from any part of the plant; and every compound,
manufacture, salt, derivative, mixture, or preparation of the plant or its resin, as may be
defined by Oregon law. It does not include the mature stalks of the plant, fiber produced from
the stalks, oil or cake made from the seeds of the plant, any other compound, manufacture,
salt, derivative, mixture, or preparation of the mature stalks (except the resin extracted
therefrom), fiber, oil, or cake, or the sterilized seed of the plant which is incapable of
germination. The definition of marijuana includes but is not limited to all marijuana-infused
products and marijuana extract.
Marijuana items means marijuana, cannabinoid products, cannabinoid concentrates, and
cannabinoid extra.
Processes means the processing, compounding, or conversion of marijuana into cannabinoid
products, cannabinoid concentrates, or cannabinoid extracts.
Produces means the manufacturing, planning, cultivating, growing, or harvesting of marijuana.
Retail sale means the transfer of marijuana or marijuana items in exchange for any valuable
consideration to a consumer.
Retail recreational marijuana business means any person or entity that is engaged in the retail
sale of marijuana or marijuana items for commercial recreational use within the city.
Recreational marijuana business does not include medical marijuana dispensaries as defined in
section 7.601 of this code.
Non-retail recreational marijuana business means any person or entity, other than a retail
recreational marijuana business, that processes, produces, transports, sells, tests, or delivers
marijuana or marijuana items for commercial recreational use within the city. Recreational
marijuana business does not include medical marijuana dispensaries as defined in section 7.601
of this code.
7.1102 License Required.
(1) No person shall establish, maintain, or operate a business that is engaged in the retail
sale of marijuana or marijuana items for commercial recreational use within the city
unless a license for that use is obtained from the city. Every place or building where a
recreational marijuana business engaged in retail sales is carried on, whether for profit
or not, shall be deemed a retail recreational marijuana business subject to the provisions
of sections 7.1100 to 7.1104. Each licensee shall meet the requirements set forth in
sections 7.000 to 7.006.
(2) No person shall establish, maintain, or operate a business that produces, processes,
transports, sells, tests, or delivers marijuana or marijuana items for commercial
recreational use other than retail sale within the city unless a license for that use is
obtained from the city. Every place or building where a non-retail recreational marijuana
Attachment 2, Page 2 of 5
Ordinance Attachment 1
business is carried on, whether for profit or not, shall be deemed a non-retail
recreational marijuana business subject to the provisions of sections 7.1100 to 7.1104.
Each licensee shall meet the requirements set forth in sections 7.000 to 7.006.
(3) A license issued under this section may be suspended, terminated, or revoked if the
standards are not met or if the business is sold or otherwise transferred as defined in
this section. No person may engage in retail or non-retail recreational marijuana
business without the appropriate license as defined in this chapter.
(4) No license will be issued without proof of registration to operate a retail or non-retail
recreational marijuana business issued by the state of Oregon.
(5) The city may deny a license if any owner, manager, operator, employee, agent, or
volunteer has been convicted of violating a general or local law of this state or another
state, or of violating a federal law, if the conviction is substantially related to the fitness
and ability of the applicant to lawfully carry out activities under the license; provided
however that the city may not consider the prior conviction of the applicant or any
owner, director, officer, manager, employee, agent, or other representative of the
applicant for:
(a) The manufacture of marijuana, if the date of the conviction is more than five
years before the date of the application to the city and the person has not
been convicted more than once for the manufacture or delivery of marijuana;
(b) The delivery of marijuana to a person 21 years of age or older, if the date of
the conviction is more than five years before the date of the application to
the city, and the person has not been convicted more than once for the
manufacture or delivery of marijuana; or
(c) The possession of marijuana.
(6) Application for a license must include the information necessary for background checks
of a criminal record of any owner, manager, operator, employee, agent, or volunteer.
The City of Springfield will conduct all necessary background checks.
(7) No license shall be issued until after a background check of the criminal record by the
police department of the applicant and all individuals employed or volunteering with the
retail or non-retail recreational marijuana business.
(8) The licensee must notify the city and submit necessary information for background
checks of a criminal record of any new owner, manager, operator, employee, agent, or
volunteer.
(9) The requirements of sections 7.1100 to 7.1104 shall apply to the owners, managers,
operators, employees, agents, and volunteers of the licensee’s business
Attachment 2, Page 3 of 5
Ordinance Attachment 1
(10) The licenses authorized by the city shall be displayed in the window such that it
is clearly visible from the nearest public right-of-way. The sign shall be no less than
eight inches by 11 inches in size.
7.1103. Operational Requirements
(1) No person shall operate a retail or non-retail recreational marijuana business without a
valid business license issued by the Oregon Liquor Control Commission.
(2) All recreational marijuana businesses must abide by the applicable regulations governing
recreational marijuana producers, retailers, processors, wholesalers, and testing
laboratories, as those terms are defined in in Oregon Administrative Rules Chapter 845,
Division 25, and all other applicable regulations.
(3) All recreational marijuana businesses must be located in accordance with Oregon
Administrative Rules Chapter 845, Division 25, and the Springfield Development Code.
(4) No minors shall be permitted on the premises of any recreational marijuana business
except as described in 7.1103(4)(a) and 7.1103(4)(b).
(a) A minor, other than an employee of a marijuana business, may be on the
premises of a marijuana business for a limited period of time in order to
accomplish a legitimate business purpose, including but not limited to, a minor
plumber being on the premises in order to make a plumbing repair.
(b) A minor who resides on the tax lot or parcel where a marijuana producer is
licensed may be present on those portions of the premises that do not contain
usable marijuana or cut and drying marijuana plants.
(5) Sign Code. All recreational marijuana businesses shall be subject to the requirements of
sections 8.200 through 8.268, the Springfield Sign Code.
(6) Alarm Business License. All recreational marijuana businesses, including recreational
marijuana businesses that are required by law to have an alarm system, must comply
with the requirements of sections 7.010 to 7.026 of this code.
(7) Gross receipts tax. All recreational marijuana businesses shall comply with the
requirements of sections 7.1000 to 7.1014 of this code.
(8) Hours of Operation. No sale or other distribution of marijuana shall occur upon the
premises or via delivery between 10:00 p.m. and 7:00 a.m.
(9) Giveaways. Recreational marijuana businesses shall not distribute marijuana or
marijuana-infused products free of charge to consumers.
(10) Consumption on Premises Prohibited. Consumption, ingestion, inhalation, or topical
application of usable marijuana, marijuana items, alcohol, or other intoxicants
Attachment 2, Page 4 of 5
Ordinance Attachment 1
anywhere on the premises of the recreational marijuana business shall be prohibited;
except as allowed under OAR 333-008-1200.
7.1104. License Fee
Each licensee shall be required to pay the applicable license fee as set by council resolution.
The license fees for retail recreational marijuana businesses and non-retail recreational
marijuana businesses need not be the same.
Attachment 2, Page 5 of 5