New Governor, New Era for State/Municipal Partnership

Governor Janet T. Mills is being inaugurated today as Maine’s first female Governor. Municipal officials and leaders throughout the state should expect a more positive relationship between the Governor and the State of Maine and local municipal government during this new administration. As everyone is well aware, despite having been the former Mayor of Waterville, Governor Paul LePage had a very testy and unproductive relationship with municipalities throughout his tenure as Governor. He was generally opposed to revenue sharing for municipalities and went out of his way to foist responsibility onto municipalities for programs and the costs of those programs for which the State historically has taken responsibility. Governor Mills, in her interview with the Maine Municipal Association which occurred prior to the election, made it abundantly clear that she welcomes the support and advice of municipalities and fully intends to restore that relationship and stop the process of shunting costs onto local property tax payers. Since Governor Mills worked her way up through the ranks of local and state politics before becoming Attorney General and finally Governor, she has a keen understanding of what local officials go through and will likely be far more sensitive to those concerns than the previous administration.

Maine Legislature Overrides Veto of Retail Marijuana Law

The Maine Legislature today voted to override Governor LePage’s veto of LD 1719, “An Act to Implement a Regulatory Structure for Adult Use Marijuana.” This is good news for municipalities eager for some certainty on what they’ll be dealing with when retail (“adult use”) marijuana establishments come to town. 

The Act makes significant changes to the existing Marijuana Legalization Act. It details state licensing procedures and criteria, as well as operational standards that must be followed by marijuana cultivation facilities, products manufacturing facilities, testing facilities, and retail stores. Anyone wishing to operate one of these facilities must first obtain a conditional state license and then receive approval from the local municipality before returning to the state for final approval. Municipal approval cannot be granted unless the municipality has adopted a town meeting article or ordinance allowing some or all types of marijuana establishments within the municipality. This essentially creates an opt-in arrangement for municipalities—meaning that no retail marijuana establishments may be located in a town unless that town has affirmatively voted to allow them. 

The Act gives municipalities broad latitude in regulating marijuana establishments. They may forbid or limit the number of any particular type of marijuana establishment. They may instead choose to adopt land use and licensing regulations and implement application fees. Marijuana establishments may not be located within 1,000 feet of a preexisting public or private school, but that distance may be reduced by ordinance to as little as 500 feet. 

As a practical matter, licenses will not be available until licensing regulations are in place. This is anticipated not to occur until at least the end of summer 2018.

Maine Legislature Votes on Marijuana Bill Veto

Updating our previous post on the fate of LD 1650, Governor LePage last week vetoed the bill and set the stage for action at the State House on Monday, where the Legislature was deciding whether to override the Governor’s veto. A two-thirds vote in both the House and Senate was required to overcome a veto.

We now know the result: the veto has been sustained, with the House voting 74-62 to uphold the Governor’s action.

A vote to override the Governor’s veto would have meant that the bill, which provided a framework for implementing the legalization of recreational marijuana approved by voters last November, would have become law and provided some flexibility for municipalities to regulate recreational marijuana. Today’s vote at the Legislature, however, means that the legalization of recreational marijuana will continue to be in legal limbo for the foreseeable future.

Marijuana Bill Awaits Veto Decision

LD 1650, An Act to Amend the Marijuana Legalization Act, was passed in both the House and the Senate on October 23, 2017. Governor LePage has until November 2, 2017, to sign the bill, veto the bill or allow it to become law without his signature. The 77-page bill comprehensively rewrites the legalization bill enacted by Citizens’ Referendum now one full year ago. Legalization of marijuana has continued to be in a legal limbo. It is legal to grow and possess certain amounts of marijuana, but it is not legal to buy or sell it, even privately.

As a municipality there are reasons to be in favor of this amended law. It now contains an opt-in provision for municipalities rather than an opt-out provision. Because of this, some of the organizations backing legalization have actually opposed the bill because they argue that it is more difficult for a municipality vote to opt-in to a law than it is to opt-out. The bill also provides economic incentives to those municipalities who participate in the program and do not opt-out. The law provides for a number of different types of licensing, including retail sales, grow only and testing facilities. A licensee may hold the first two licenses, but the testing facility must be independent. If the governor does not sign the law, there will be a number of challenging legal issues arising.

The bill also sets more appropriate tax rates, limits properties to 18 plants growing, closes “gift” and “delivery” scams and allows employers to hire and fire based on adult use of legal marijuana.

Maine Municipal Law Update: Biennial Budget, Marijuana Legalization & Opportunity Agenda

Maine's Biennial Budget

Legislative work continues to steadily flow in Augusta, Maine as more bills are taken up by policy committees and many of them are meeting passage or being killed. In addition, the state’s biennial budget is slowly inching forward as the Appropriations & Financial Committee has accepted non-controversial initiatives, and will soon tackle the more contentious ones.

The Marijuana Legalization Implementation Committee

In the meantime, the implementation of adult-use marijuana legalization continues to pose interesting and as-yet undecided policy questions to the Marijuana Legalization Implementation Committee (MLI) and the State House’s respective party caucuses.

The MLI has thus far held a series of public hearings allowing any and all members of the public to voice a range of opinions around marijuana policy, including the state’s preexisting medical program. However, only LD 243 has been taken up in MLI. This bill, after being extensively worked by the committee received a 16-1 “ought to pass as amended” vote.  It is now poised to establish a “hub and spokes” model of licensing that would be centered on the Department of Administrative and Financial Services (DAFS) with major “spokes” extending to the Bureau of Alcoholic Beverages and Lottery Operations (BABLO) and the Department of Agriculture, Conservation, and Forestry (DACF). BABLO, an organization that exists within DAFS, would regulate packaging and retail, while DACF would regulate cultivation. 

The Committee will continue to meet regularly through the end of session and continue through the interim period between sessions.  The Committee is likely to hold several more large public hearings throughout the spring that will cluster individual bills based on their proposals and the different aspects of legalization implementation.

Opportunity Agenda

In other news, Legislative Democrats unveiled the “Opportunity Agenda” last week, a counter-proposal to the most recent LePage biennial budget. The program is touted by Democrats as providing the largest property tax cut in history, funded partially through new revenues created by adult-use marijuana legalization.

Maine's Joint Select Committee on Marijuana Legalization Implementation

Possession of up to 2.5 ounces of marijuana for recreational purposes has now been legal in the State of Maine for three weeks. The world as we know it seems unchanged. This, of course, follows the passage of last year’s Question #1 ballot initiative that sought to legalize the use of marijuana and was ultimately successful at the ballot box. Differences of opinion between various legislative factions and Governor Paul LePage over which bureaucratic agency should oversee eventual permitting for the commercial sale of marijuana also led to the late January passage of an emergency bill to make technical changes to the ballot initiative.

The passage of Question #1 led Maine’s 186-member legislature to respectively introduce roughly 70 individual pieces of legislation that would seek to impact the State’s relationship with marijuana in any number of ways. To best deal with this slew of bills that would otherwise be referred to several legislative committees, but chief among them the Joint Standing Committee on Veterans and Legal Affairs, legislative leadership last month agreed to the creation of a Joint Select Committee on Marijuana Legalization Implementation. This temporary, session-only committee will take up these bills in public hearing and continue to work them over the course of the 1st Regular Session of the 128th Legislature, which is likely to adjourn in June.

The Joint Select Committee has scheduled a public forum on the implementation of marijuana legalization that will be held Tuesday, February 28 at 1:00 P.M. in Room 216 of the Cross Office Building.

LePage Demands Stall Marijuana Law

Yesterday the already tumultuous story of LD 88, "An Act To Delay the Implementation of Certain Portions of the Marijuana Legalization Act" took an increasingly intriguing turn when the bill was enacted by the Legislature but failed to meet Governor LePage's policy demands.

LD 88 was introduced by Rep. Louis Luchini (D-Ellsworth) earlier this month in response to last November's passage of referendum Question 1, which legalized recreational marijuana use. The ballot initiative failed to include language that could ensure minors would not be able to legally purchase or possess marijuana and this necessitated an amendment broadly accepted by the marijuana industry and community.

A more contentious aspect of the bill was to delay implementation of rule-making for three months, which was widely regarded as a heavy-handed delay of the implementation of the entire referendum. This common misconception frustrated stakeholders and many lawmakers during the bill's public hearing and work sessions as marijuana activists lambasted what they considered nefarious intent.

During the Legislature's Joint Standing Committee on Veterans and Legal Affairs' time working the bill Governor LePage made relatively little comment and did not get directly involved in goings-on around the document. That all changed during the middle part of this week, however, when the Blaine House began making noise that the Governor would veto an otherwise smooth ascendency of LD 88 if it did not hand retail licensing authority to the Bureau of Alcoholic Beverages & Lottery Operations rather than house it under the Department of Agriculture, Conservation & Forestry.

The left flank of the House Democratic Caucus was always uncomfortable with any mention of "delay" in relation to Question 1 and so the ground was fertile for knee-jerk disagreement when House Republicans sponsored a floor amendment proposing to make LePage's demanded changes, which also included 1.6 million dollars to better fund rule-making. The amendment was rejected in the House yesterday morning and both bodies of the Legislature moved swiftly to enact the bill in its original form.

There continued to be much uncertainty, though, as Governor LePage's threat to veto LD 88 loomed large over the Legislature. He is capable of holding the bill for ten business days without signing it or allowing it to become law and has been known to wait till the last hour to issue vetoes.

At 4 pm yesterday afternoon legislative leadership met with the Governor to try to avert an impending "crisis." They feared failing to have the bill signed by the Governor before the January 30 implementation of Question 1. The Governor indicated he might not issue a veto, and the media has reported he has refused to sign or veto it but there is broad consensus within the State House that any gubernatorial action during the next ten business days is possible.

Governor Certifies Marijuana Legalization Law

Governor LePage has certified the vote on the legalization of marijuana in Maine, which is now going into effect on January 30, 2017. It will be legal to possess up to 2.5 ounces of marijuana and grow your own six plants. There is no system in place to distribute recreational marijuana. It will be legal to give it away.

A number of municipalities, including our clients in Augusta, Brunswick and Windham, have enacted moratoria against the development of retail businesses and social clubs. This allows Towns to determine whether to ban retail sales and social clubs and to decide whether there are good reasons to treat retail differently from other retail stores and social clubs differently than bars. At least one town, Oakland, has enacted a ban because it believed it did not have the authority to enact a moratorium because it did not have an adequate Comprehensive Plan.

At this point there is no great benefit nor downside to enacting a moratorium. This is because under the law, the Legislature has nine months to establish a system for legal sales and social clubs and will need to correct some of the errors in the law, including a loophole pointed out by Attorney General Janet Mills, which could be read to allow sales of marijuana to people under the age of 21. There will be an intense lobbying effort in the upcoming Legislature by numerous parties, including the established dispensaries, caregivers and other interested parties, to make changes to the law. The Governor has already proposed a one-year moratorium. Many people think the Department of Agriculture is not the best agency to administer the program. How will the medical marijuana law be affected? MMA has already put in a bill to clarify municipal home rule authority to regulate medical marijuana.

This blog will track the process of the legalization bill and other marijuana and municipal related issues through the Legislature on a weekly basis.