Legal Blog

Medical Cannabis in Maryland – A Patchwork Approach to Zoning

As the result of countless ballot initiatives, tireless advocacy, and a gradual but consistent shift in public attitudes toward the use of cannabis (medically, recreationally, and otherwise), the cannabis industry has become one of the nation’s fastest-growing industries and an attractive investment vehicle for many property owners, real estate developers/investors, and entrepreneurs throughout the country.  As the demands for cannabis and cannabis related industries have risen, states and local jurisdictions have been forced to re-examine their local land use controls and regulations and adapt them to this burgeoning industry, all while under the watchful and critical eyes of both cannabis advocates and opponents.  In this regard, Maryland’s struggle to blend its nascent statewide medical cannabis program with the local autonomy granted to its counties and municipalities in the realm of land planning and zoning can be seen as a microcosm of the struggle currently playing out in many jurisdictions throughout the country.

 

With the creation of the Natalie M. LaPrade Medical Marijuana Commission in 2013, the Maryland legislature took its first steps towards establishing meaningful statewide patient access to medicinal cannabis.  As the demands for medical cannabis quickly outpaced the existing antiquated delivery system model (namely research establishments and academic facilities), the General Assembly was forced to overhaul its fledgling legislative framework and provide, for the first time, private investors and entrepreneurs the opportunity to participate in the growing, processing, and dispensing of medical cannabis; albeit under a system of statewide licensing requirements and comprehensive regulatory controls.  While the regulatory framework generated by the Commission (since rebranded the Natalie M. LaPrade Maryland Medical Cannabis Commission) and the controlled and equal distribution of licenses along senatorial district lines created the illusion of uniformity in patient access to medical cannabis throughout the state, the deference afforded local governments in the realm of planning and zoning in all aspects of the medical cannabis industry (growers, processors, and dispensaries) has resulted in a patchwork of zoning rules and regulations ranging from the incentivizing “open arms” policies of Washington County in the west to the prohibitive and onerous limitations of Anne Arundel County in the heart of the state – with a hodgepodge of approaches in between.

 

As is true throughout the country, the impact of local land use controls on the medical cannabis industry in Maryland and the need for license holders, prospective applicants, landlords, property owners, and real estate investors to retain knowledgeable legal counsel in this highly specialized area of the law cannot be overstated.  The regulations promulgated by the Commission for each tier of medical cannabis operations (growers, processors, and dispensaries) within the state of Maryland mandate an express finding of compliance with all local “zoning and planning requirements” prior to the issuance of final license approval.  Determining what those “requirements” are on a case by case basis requires an examination of the land use regulations, codes, and ordinances adopted by the governing planning and zoning body for each subject county and in some cases the particular municipality in question.

 

Just as several jurisdictions within Maryland (notably the counties of Montgomery and Howard) have stated publicly that they intend to process medical cannabis businesses under their existing planning and zoning regulations through interpretations of agribusiness, retail, ambulatory medical care, and other such use categories, approximately one-fourth of all counties in Maryland to date have adopted zoning regulations specifically targeting the medical cannabis industry, and at least one county, Anne Arundel County, has attempted to use its zoning regulations to establish a de facto prohibition.  While the Maryland Attorney General’s office issued an advisory opinion in September 2015 holding that local governments cannot expressly prohibit the growth, processing, and sale of medical cannabis otherwise permitted by state law through the enactment of local ordinances (zoning and otherwise), many local jurisdictions have used their legislative powers to establish planning and zoning ordinances limiting the operation of medical cannabis businesses to specified zoning districts with onerous use setbacks (i.e., at least 1,000 feet from public or private schools, churches, or correctional facilities), restrictive signage and lighting standards, and enhanced security requirements.  These use restrictions and additional limitations vary from jurisdiction to jurisdiction and can have the effect of creating limited clusters of available sites (known colloquially as “green zones”) which can have the effect of forcing cannabis businesses to compete directly with each other within artificially reduced markets or driving cannabis businesses out of the county completely – many counties with cannabis specific zoning regulations require such businesses to be separated from each other by distances ranging from 1,000 feet to one mile.  These myriad rules and regulations provide numerous pitfalls for the unwary and can prove fatal to license holders, property owners, and investors lacking the knowledge to navigate these unsettled waters.

 

In summary, until the dust settles on the zoning landscape of medical cannabis operations throughout the nation, owners, operators, and investors in this burgeoning industry will be forced to grapple with the complex and ever-changing land use regulations established by individual state and local jurisdictions.  As such, partnering with a competent land use attorney during the site selection and due diligence process is vital to the success of every medical cannabis business.

 

If you have any questions or concerns about how planning and zoning approvals may affect your medical cannabis operation, please contact Andrew H. Robinson at arobinson@offitkurman.com or 301-575-0321.

ABOUT ANDREW ROBINSON

arobinson@offitkurman.com | 301.575.0321

Andrew Robinson is a Principal in the Real Estate Law And Transactions group. He focuses on land use cases as well as areas of administrative and construction law. Mr. Robinson has experience representing clients facing homeowner association, landlord-tenant or construction disputes. He has assisted clients in processing subdivision and condominium development as well as in planning and zoning matters. Additionally, clients turn to Mr. Robinson for complex real estate transactions, commercial leasing and general litigation

 

 

 

 

 

 

 

ABOUT OFFIT KURMAN

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