Pubdate: Wed, 11 May 2011
Source: City Pulse (Lansing, MI)
Copyright: 2011 City Pulse
Contact:  http://www.lansingcitypulse.com/
Details: http://www.mapinc.org/media/4532
Author: Andy Balaskovitz
Bookmark: http://www.mapinc.org/find?275 (Cannabis - Michigan)
Bookmark: http://www.mapinc.org/find?253 (Cannabis - Medicinal - U.S.)

A DISPENSARY SHUFFLE?

What Will Happen to the 41 Operating Medical Marijuana Dispensaries 
in Lansing? A Draft Regulation Ordinance That Would Force Most of 
Them to Move Surfaces, Raising Questions

The Lansing city attorney has presented a draft ordinance to regulate 
medical marijuana dispensaries in the city that if enacted would 
force 37 of them to move from their present location to stay in business.

The draft ordinance, written by City Attorney Brig Smith with input 
from Lansing City Councilwoman Carol Wood, has raised the eyebrows of 
some dispensary owners and local attorneys because it would restrict 
new dispensaries to industrially zoned areas of the city and force 
those not in those zones to move if they want to stay open.

The draft ordinance makes no provision for grandfathering existing 
businesses in their current locations if they are outside of 
industrially zoned areas.

"Those existing businesses in commercial areas who say they're 
allowed to be open, this (ordinance) says, 'No, you aren't,'" Smith 
said Thursday. "And that would be decided in court."

However, both Wood and Smith agree this aspect of the ordinance could 
change as it is examined in the Council's Public Safety Committee, 
which Wood chairs. But Wood said she is in favor of limiting new 
businesses to industrially zoned areas.

Forty-seven addresses are grandfathered in with the city where 
medical marijuana businesses may operate during the moratorium that 
started in December and lasts until July or if a new ordinance 
regulating them takes effect before July.

Of those, 41 are operating. Only four of them are in areas zoned for 
industrial use: Victoria's Club Med-a-sin at 1039 N. Cedar St., 
Mid-Michigan Patient's Group at 821 E. Kalamazoo St., Grand River 
Alternative Medicine at 711 E. Grand River Ave. and Buono's at 1419 Turner St.

So does the city really intend to force the other 37 businesses to 
move? If not, why didn't the city attorney add a line to the 
ordinance that says existing businesses not in industrial areas can 
stay open? And why does this ordinance suggest dispensaries are legal 
businesses but restricts them to industrially zoned areas?

"I think it's a starting point. I'm not saying it's the ending 
point," Wood said, adding that putting them in industrial areas came 
from neighborhood groups' concerns of the "proliferation" of 
dispensaries, particularly on the east side. "I want people to 
understand this is a first blush. I'm not saying I'm opposed to 
looking at grandfathering in or doing something for those already 
established as long as they meet with the licensing requirements."

But why not just include it in this draft?

"I don't know. That's a good question," Wood said. "We're talking 
about a draft we've got out there. That's why you go through the process."

Aside from existing businesses, Wood said it would be "her 
preference" that any future businesses would be in industrial areas. 
"But I'm only one vote on the Council."

Industrially zoned areas dot the city and sometimes are adjacent to 
commercially zoned properties.

Smith, who drafted the proposed legislation, said Monday that the 
issue of forcing businesses to move is "one of a number of issues" 
that needs to be addressed at the committee level.

"The nature of any legislation is that it's worked out in the 
committee process. I would cite you to 'Schoolhouse Rock!'" he said, 
referring to a children's cartoon series that did an episode on how 
laws are made.

One dispensary owner - Shekina Pena of Your Healthy Choice Clinic at 
628 E. Michigan Ave. - said "this doesn't look like Brig's work at 
all," suggesting the ordinance goes too far by restricting commercial 
entities to industrial zones. Smith's response: "I have worked in 
conjunction with Council member Wood's vision. I have done my best to 
effectuate that vision with the understanding from 'Schoolhouse 
Rock!' that going through committee (and getting reworked) is how a 
bill becomes a law. If there is concern in the community, the 
committee should address that."

Smith said that the city faces "tension" at the county level from two 
prosecutors who disagree on whether dispensaries are legal. Ingham 
County Prosecutor Stuart Dunnings III thinks they're illegal, Eaton 
County Prosecutor Jeff Sauter thinks they're legal, Smith said.

The city is in both counties.

"If Eaton County feels one way and Ingham County feels the other way, 
that's a tension the city must face," he said.

Mayor Virg Bernero weighed in on the proposed ordinance Monday. He's 
against it and would like to see a more "progressive" regulatory 
approach from Council, allowing storefronts throughout the city but 
not in neighborhoods.

"I think it's the wrong way to go," Bernero said. "We need to 
facilitate what the voters voted for. I want to keep them 
(dispensaries) out of neighborhoods. What I envision is a regulated 
storefront."

Bernero said East Lansing's commercial medical marijuana ordinance - 
which was adopted in March and limits businesses to 
professional-office zoned areas - is "decent" but creates "marijuana ghettos."

Bernero said he's "disappointed" with the first draft of Lansing's 
ordinance. "I haven't seen the progressive leadership of Council step 
up. There are progressive voices on Council - they need to step up."

Two Components

The proposed ordinance regulates dispensaries in two ways: through 
zoning restrictions and licensing requirements. In order to open, a 
business must first obtain a license from the City Clerk's Office, 
which would last a year. The Council would determine prices of those 
for medical marijuana dispensaries. One of the license requirements 
is that a dispensary cannot violate any portion of the ordinance, 
which ties into the requirement of being in an industrially zoned area.

The draft ordinance would regulate dispensaries and cultivation 
businesses. A dispensary is defined as "a nonresidential land use 
where marihuana is distributed by one or more primary caregivers but 
is not grown or cultivated." A cultivation business is defined as "a 
nonresidential land use where marihuana is grown or cultivated in an 
enclosed, locked facility by one or more primary caregivers but is 
not distributed." Both types of businesses would be restricted to 
industrial areas.

A "stakeholder" in either of these businesses includes "a partner, a 
member, an officer, a director, an employee, or any person with an 
ownership interest of 10 percent or more." Their identities would 
have to be disclosed.

A Zoning Dilemma

By limiting businesses to industrially zoned areas, the proposed 
ordinance creates a "nonconforming use" situation for those 37 
existing businesses not in industrially zoned areas.

Two local attorneys said that if the city forces the 37 dispensaries 
in Lansing to move in order to stay in business and owners decide to 
challenge the ordinance in court, the question won't be about whether 
they are allowed to stay, but if the dispensary itself is a legal business.

Matt Newburg, a local attorney who specializes in medical marijuana 
law, said case law throughout the state is clear on nonconforming 
uses. If a municipality drafts a zoning ordinance that forces a 
business into non-compliance, that business is allowed to continue 
operating. However, if you apply this concept to dispensaries, whose 
legality is being questioned in the state Court of Appeals, this 
issue isn't so clear.

An Isabella County circuit judge ruled this winter that a dispensary 
in Mount Pleasant is operating legally under the state Medical Marihuana Act.

That case, the state v. McQueen, is being appealed to the state Court 
of Appeals.

By allowing them in industrial zones, though, Newburg said the city 
is implying that they're legal businesses and are a "legal 
nonconforming use" and should be allowed to stay put.

Mary Chartier, of the Lansing-based firm Alane and Chartier, agrees 
with Newburg. Chartier questions the motives of limiting dispensaries 
to industrial zones.

"Either it's a legitimate business that's going to be allowed in the 
city or it's not. If it is, pushing them into a dark corner doesn't 
seem to be the best action," she said. "The city can't have it both 
ways. It can't recognize them as a legitimate business and then push 
them into a corner and still want their tax revenue. This (ordinance) 
seems to be an assault on legitimate businesses for legitimate 
patients. They should be treated like any other business."

Mark Wyckoff, director of the Planning and Zoning Center at Michigan 
State University, said that because businesses opened before the city 
specifically authorized them, the city could argue that dispensaries 
are therefore prohibited. If a dispensary challenges a forced move in 
court, Wyckoff said that even though the city is attempting to 
regulate them, they weren't recognized as permitted uses before the 
ordinance and would not have non-conforming-use protection. All of 
this leaves a lot of open-ended questions for Lansing dispensary 
owners, he said.

"The court would have to decide. This is not a unilateral thing," he 
said. "If you were going to invest in one of these businesses, I'd 
pick the five that are in the zone that are in place. They may 
suddenly increase their market share."

When asked if regulating zoning for dispensaries is in a league of 
its own, Wyckoff said, "Oh, yeah. You have a new set of legal 
arguments: Is the use itself even lawful? Whatever sense you make of 
(regulating dispensaries) is ephemeral. This is a moving target and 
it's going to continue to move for quite some time."

A Similar Situation in Ann Arbor

Lansing is not the only city that is attempting to regulate 
commercial medical marijuana businesses after some have already opened.

In Ann Arbor, between two and 15 dispensaries opened before the Ann 
Arbor City Council adopted a moratorium in August on new ones. Ann 
Arbor City Councilwoman Sabra Briere said that "nobody had a clear 
grasp of how many medical marijuana dispensaries were in operation" 
at the time of the moratorium and still don't. She said that's 
creating a problem at this point because the licensing portion of the 
proposed ordinance grants licenses in proportion to how many are open.

As for zoning, Ann Arbor's proposed ordinance is similar in that it 
would regulate nonresidential grow operations and dispensaries. 
However, Ann Arbor is considering allowing new dispensaries in the 
downtown, unlike Lansing.

"We focused always on not treating medical marijuana as if it were 
different from any other activity. It's just a business," Briere said.

But when Briere told dispensary owners they may have to move 
locations based on where the city ultimately allows dispensaries, she 
said they were receptive to the idea.

"I empathize with the business owners who may find themselves in the 
wrong zone but I don't feel any unit of government owes them an 
apology that they're in the wrong zone," she said. "They were very 
grateful anyone bothered to care about their financial well-being," she said.

Robin Schneider, president of the Capitol City Compassion Club, a 
nonprofit dispensary at 2010 E. Michigan Ave., called Lansing's 
proposed ordinance "not acceptable" and "a joke" if it forces people 
to move. She said she doesn't have a problem with it in "its entirety 
other than the fact it doesn't say existing businesses are grandfathered in."

"As long as they do that I won't have much of a problem with it," she said.

Leo Jerome owns two properties listed in Lansing's moratorium - 3165 
E. Michigan Ave. and 6420 S. Cedar St. - but no businesses are 
operating there. Jerome has attended several Public Safety Committees 
over the past few months when medical marijuana was on the agenda. He 
was at the Public Safety Committee meeting Thursday because he's 
considering potential investors who may want to open a business at 
his properties.

He's hoping the city thinks twice about forcing businesses to move 
and limiting them to industrial areas.

"We filled up a bunch of empty stores on the main drags. Now you're 
going to take these stores and make them empty again?" he said. "And 
does it have to be in an industrial zone? Why put them in the side alleys?"  
- ---
MAP posted-by: Richard Lake