The Control, Regulate, and Tax Adult Use of Marijuana Act (AUMA) presents a myriad of land use and environmental issues that will affect cultivators, distributors and other private entities and public agencies. Those issues touch on existing environmental and land use laws as well as new regulations that will be developed at the local and state levels. With regard to land use, AUMA allows local agencies to develop planning and zoning regulations. These regulations will address whether to allow such businesses, where such businesses may locate, and conditions for operating such businesses. The development of these regulations and approval of local permits, and State licensing procedures, are all subject to CEQA. Further, there is a web of environmental regulations, both existing and soon to be developed, that must be considered and complied with by cultivators, distributors and other private entities and public agencies. Those regulations include water use and water rights, wastewater and wetlands permitting, species protection, and pesticide use, under federal, state, and local laws, including the Clean Water Act, Endangered Species Act, and California Fish and Game and Water Codes. This webinar focuses on what municipalities can and cannot do through their land use powers to regulate nonmedical marijuana businesses, and strategies that private businesses and local governments can use in the coming months while the State crafts new regulations. The webinar also addresses the complex interplay of federal, state, and local environmental regulations that will affect this new industry.

1. LEGALIZED RECREATIONAL
MARIJUANA: Land Use and
Environmental Laws
Ed Grutzmacher, Of Counsel
Sarah Quiter, Senior Associate
December 14, 2016

2. 2
• Overview of Land Use Hierarchy
– General Plan
– Specific or Area Plans
– Zoning Code
– Conditional Use Permits
Land Use – Local Regulation and Strategies
Scope: Broadest
Most
Specific
Change: Hardest Easiest

3. 3
• Local agencies have broad land use authority
– AUMA does little to change that
• What local agencies cannot regulate is narrow:
– Personal possession, processing, transport,
purchasing or giving away (21 and over)
– Personal use in a private residence (21 and over)
– Transport of marijuana or marijuana products
using public roads
– Cultivation of up to 6 plants per residence
(subject to “reasonable” local regulations)
Land Use – Local Regulation and Strategies

4. 4
• What local agencies can regulate is broad
– Everything else
Land Use – Local Regulation and Strategies

5. 5
• 13 for Cultivation
– Indoor
– Outdoor
– Mixed-Light
– Nursery
• 2 Manufacturing
19 Total License Types
MARIJUANA LICENSE
• Testing
• Retailer
• Distributor
• Microbusiness

6. 6
• Make sure you are regulating
everything you want to regulate
– Multiple types of cultivation
(not just indoor/outdoor)
– Manufacturing, testing, retail,
distribution, and microbusiness
– Marijuana products and
marijuana paraphernalia
Local Agency Strategies

7. 7
• Many different types of
regulations available
– Complete bans
– Limiting uses to specific
zoning districts
– Requiring conditional use permits
– Increasing types of sensitive uses
or distance from sensitive uses
from that in AUMA
– Operational restrictions
Local Agency Strategies

8. 8
• Dangers of not specifically
regulating specific types
of marijuana businesses
• Beware reliance on
“permissive zoning”
– Generally, if not specifically
permitted, it is not allowed
– But – Silence by local regulations
may lead to issuance of State
licenses anyway
Local Agency Strategies

9. 9
• Can create confusion – What’s the difference?
Local Agency Strategies

10. 10
• If your jurisdiction is going to allow uses, beware
“overconcentration” issue
– Much like ABC licenses
– Achieving a balance between prohibiting uses
and creating pockets of heavily concentrated uses
Local Agency Strategies

11. 11
• Moratoria
– Gov’t Code 65858 allows local agencies to put a
temporary halt on types of development while the
agency considered permanent regulations
Local Agency Strategies
Initial 45-day period
plus two extensions
for up to a total of
two years
Must be working
towards permanent
regulations

12. 12
Business Strategies
Know where
you want to
operate
Monitor what actions
the local agency is
taking, or may already
have taken Participate
in the process
Be aware of planning
hierarchy when planning
your project
Show up, make your voice
heard when local agencies are
considering new temporary or
permanent regulations

13. 13
• Zoning regulations are not permanent
– They can be changed at the
discretion of the local agency
Business Strategies

14. 14
• Consider a Development Agreement
(Gov’t Code 65864)
– Allows for certainty in development (vested right)
– Allows agencies to test the waters with certain
types of uses
– Avoids constitutional “nexus” standard for
conditions and allows public benefit requirements
– Drawback – must be approved by an ordinance
which is subject to referendum
Strategies for Both

15. 15
• Consider/promote alternatives between
no uses and fully allowed uses
Specific standards for
marijuana businesses
Strategic use of
overlay zoning
Strategies for Both

16. 16
• Don’t forget about CEQA!
– Development of new zoning and regulations
are subject to CEQA
– Specific project approvals are subject to CEQA
CEQA

17. 17
• Marijuana businesses will create unique impacts
for consideration in CEQA documents
– Water use
– Odor
– Hazardous Substances
– Energy Use
– Traffic/Parking
– Public Safety
CEQA

18. 18
• Nonmedical marijuana “unregulated” without any
environmental protections
– 40 years of environmental laws currently apply
• Requires state agencies to develop environmental
regulations and coordinate/consult with each other
• Requires compliance with environmental laws as a
condition of licensure
• Tax revenues will help address environmental
impacts
Proposition 64

19. 19
• Water supply
– Water diversion
• Water quality
– Polluted runoff from pesticides,
erosion, other chemicals and wastes
• Soil
– Improper use and storage of petroleum
products and chemicals
• Species and habitat
– Land development, tree removal,
water diversion, water pollution
• Carbon footprint
– Electricity usage
Environmental Impacts

20. 20
If marijuana cultivation is not prohibited in your area:
County grading permits
Erosion control plans
Existing Law: Local Requirements

21. 21
State Water Resources Control Board Division of Water Rights
– Water right to legally divert water
– Riparian, appropriative, and prescriptive rights
– Application for water right permits/licenses
– Permits from other agencies may also be required before
allowed to divert water
Prop 64: Applicants for cultivation license must identify
source(s) of water that will be used and certify legal right
to use water under state law (Business and Professions Code § 26056(c))
Existing Law: Water Supply

22. 22
• State Water Resources Control Board
• Regional Water Quality Control Boards
– NPDES permits (e.g. storm water)
– Waste discharge requirements (WDRs)
– Conditional waiver of WDRs / water quality
certification
Existing Law: Water Quality

23. 23
• 2 current permits regulate discharges from
cultivation
– Region 1 (North Coast): conditional waiver; both
medical and recreational
– Region 5 (Central Valley): WDRs; medical only
– Tiered framework based on threat to water quality
– Best management practices
• U.S. Army Corps of Engineers
– 404 permit to dredge/fill wetlands
Existing Law: Water Quality

24. 24
• U.S. Fish and Wildlife Service
– Endangered Species Act
• Consultation + Incidental Take Permit
and Habitat Conservation Plan
• California Department of Fish and Wildlife (CDFW)
– California Endangered Species Act
• Consultation + Incidental Take Permit
– Pollution prohibitions
– Lake or Streambed Alteration Agreement
• California Department of Forestry and Fire Protection
(CalFIRE)
– Timberland conversion permit
Existing Law: Species and Habitat

25. 25
• Federal Insecticide Fungicide and Rodenticide Act
(FIFRA)
• Federal Food Drug and Cosmetic Act
• California Law - No pesticides allowed unless:
Existing Laws: Pesticides
AND
Either
(a) exempt from
registration requirements;
OR
(b) registered for a use that
is broad enough to include
use on marijuana
Exempt from residue
tolerance requirements

26. 26
Additional Laws on the Horizon
Water Code § 13276 - Water Boards may adopt permits that address:
– Site development and maintenance, erosion control, and drainage features
– Stream crossing installation and maintenance
– Riparian and wetland protection and management
– Soil disposal
– Water storage and use
– Irrigation runoff
– Fertilizers and soil
– Pesticides and herbicides
– Petroleum products and other chemicals
– Cultivation-related waste
– Refuse and human waste
– Cleanup, restoration, and mitigation

27. 27
Additional Laws on the Horizon
• Department of Fish and Wildlife
– May develop regulations for interim
flows associated with marijuana cultivation
• Department of Food and Agriculture
– Required to include conditions in each cultivation
license requested by CDFW and SWRCB
– May develop regulations that address environmental
impacts of cultivation
• Department of Pesticide Regulation
– Consult with Department of Food and Agriculture to develop
standards for pesticide use in cultivation
– Consult with SWRCB to develop regulations that require that
application of pesticides or other pest control meet standards of
Food and Agricultural Code

28. 28
Other Issues
• Many levels of coordination
among many state agencies
• Intersection with medical
marijuana
• Enforcement
• New administration

29. 29
Q&A
29

30. 30
Presenters
Ed Grutzmatcher
Of Counsel
egrutzmatcher@meyersnave.com
510.808.2000
Sarah Quiter
Senior Associate
squiter@meyersnave.com
510.808.2000
Upcoming Prop 64 Webinars:
Employment Issues
January 4, 2017
Taxation/Ballot Measures
January 18, 2017
State Regulations & Potential Changes
February 1, 2017
For more information, visit meyersnave.com