|Montana voters, including those in Yellowstone County and the City of Billings, approved Initiative190 (I-190) which permitted recreational adult-use marijuana and approved certain marijuana businesses in the state. The I-190 was amended by the legislature in House Bill 701, which was signed into law on May 18, 2021. HB 701 delayed many effective dates from the 190-Initiative, significantly changed the scope of marijuana businesses, expanded some local government regulatory options, and repealed the existing Montana Medical Marijuana Act. Most of these changes will be effective January 1, 2022.
Under the prior version of the Montana Medical Marijuana Act, state statutes expressly authorized the City of Billings to prohibit storefronts. BMCC Ordinance 11-5545, passed on November 14, 2011, prohibited storefronts under the authority granted to the City of Billings by state statute. Ordinance 11-5545 does not prohibit dispensaries because the authority to prohibit "dispensaries" was provided by a later amendment to state law. The City previously relied on Ordinance 12-5587, which requires all businesses to comply with local, state, and federal law, in denying business licenses to dispensaries. However, the changes in HB 701 require the City to provide for significant changes in its approach to marijuana businesses.
Montana medical marijuana businesses will be the first to be granted state licenses for recreational adult-use, but only to the extent that those medical marijuana businesses are in good standing with the state and any local jurisdiction as of January 1, 2022. For this reason, timely adoption of standards related to medical marijuana businesses maximizes the ability of the City of Billings to regulate both medical marijuana sales and adult-use marijuana businesses.
Per Council direction, and through coordination with a City Administrator established Working Group that includes Council members, staff is developing regulations for City Council to consider at an upcoming regular business meeting. As part of that process, City Council also is acting on an initiative later in this meeting to initiate a zoning code text amendment process to address the new marijuana land use regulations.
However, there are currently businesses in Yellowstone County/City of Billings that have medical marijuana licenses issued by the state and they may seek to obtain a business license from the City prior to the adoption of zoning and business license regulations by City Council. This would create issues with zoning if the businesses sought to locate in a zoning district where such use may be prohibited under the City's new regulations. Another example of a problematic issue this would create is if the Council considers capping the number of business licenses to be issued in an area and a business obtains a license prior to adoption of that regulation. Such a business would have an unfair advantage over other businesses. For these reasons, staff is recommending the Council adopt these two ordinances to place a moratorium on new marijuana businesses through land use or business license entitlement processes until the CIty adopts its new regulatory processes per authority under state law prior to January 1, 2022.
|City Council may:
- Adopt an Interim Zoning Ordinance imposing a moratorium on new marijuana businesses, and adopt an Emergency Business License Ordinance imposing a temporary suspension on issuing business licenses to marijuana businesses; or,
- Not adopt an Interim Zoning Ordinance imposing a moratorium on new marijuana businesses, and not adopt an Emergency Business License Ordinance imposing a temporary suspension on issuing business licenses to marijuana businesses. Not adopting these ordinances would not align with the Council's intent to develop new zoning and business license regulations for marijuana businesses per House Bill 701 that was signed into law by the Governor in May 2021. Not adopting these ordinances could also place the City in an awkward position of being asked to approve new marijuana businesses in the City while at the same time drafting new regulations that apply to the same businesses. New state regulations take effect January 1, 2022, so the City will have these moratoriums in place until approximately the end of the year to complete drafting and adoption of new regulations.