Zoning for Marijuana-Related Businesses Remains Controversial

Citizens speaking at last Wednesday’s East Lansing Planning Commission meeting fell into three groups: those concerned about the possibility of any marijuana-related business in or near their neighborhoods because they fear increased crime, environmental hazards, and public health concerns, those encouraging the Commission to pave the way swiftly for what they see as a long-awaited business opportunity beneficial to individuals and the regional economy and those who had no objection to the marijuana industry, but felt the proposed zoning was inappropriate.

Public comment at the meeting focused mostly on where the City should permit marijuana-related businesses, an issue on which the Commission must advise City Council. The Commission ultimately decided to recommend against permitting growing or processing facilities in several zones located near the Hawk Nest neighborhood, on the northern side of the City.

The Commission did, however, recommend allowing operations in zones such as B1 (general office business districts) which currently includes Merit Laboratories, an established East Lansing scientific lab located near Costco that is seeking to take advantage of what is likely to become a lucrative business opportunity in testing marijuana for safety and potency.

At the meeting, Planning Commission considered two separate ordinances to define the places where medical marijuana can be grown, processed, tested, stored and transported, and sold to caregivers and holders of state-issued medical marijuana cards. A 2016 state law, Public Act 281 governs all five activities, and the application process for licensure under that law will begin on December 15 of this year.

In 2016, in response to state action, East Lansing’s City Council introduced draft legislation to outline zoning for the five categories of businesses (growing, processing, testing, storing, and transporting) in the form of Ordinance 1395. This ordinance, which the Planning Commission has re-worked and discussed extensively, was on last week’s agenda as “old business.”

More recently, according to City Planning staff member David Haywood, the City decided that legal locations for provisioning centers should be considered separately from those for growing, processing, transport and processing operations because they “would require more time and discussion.” (The state law uses the term “provisioning centers” to label what have traditionally been known as “dispensaries.”) This led to the City drafting Ordinance 1416 which is based on 1395, but applies only to the zoning of provisioning centers in East Lansing.

At least part of the proposed zoning for growing and processing facilities under Ordinance 1395 lay in Residential/Agricultural or “RA” zoning, most of which is in the northern part of the City near the Hawk Nest development and large apartment complexes on Chandler Road. (See neighborhood map.)

During public comment at Planning Commission last week, former Council member Ralph Monsma noted that the framework for the medical marijuana industry had been provided by state law, and that it fell to East Lansing’s Planning Commission only to decide “how to use the appropriate place in our community and how to go about it.”

Although he said he wasn’t opposed to medical marijuana, Monsma felt that given the limited amount of land in East Lansing, the Northern Tier area would better be used for development of more housing for families and that the industrial aspects of the marijuana business might better be located elsewhere in the City or in other municipalities with more appropriate space.

Speaker Rod Pryor echoed these concerns, saying he opposed neither medical marijuana nor related businesses, but that the current RA area was “not an appropriate place” to locate it.

Speaking in favor of the medical marijuana business was local attorney and marijuana advocate Jeff Hank (above), who said the City should encourage “a free market system with zoning decided case by case.” He emphasized the revenue associated with the marijuana industry and said that anti-marijuana materials submitted to East Lansing’s Planning Department by the Clinton County Substance Abuse Prevention Coalition were “rubbish” and “embarrassing.”

Hank pointed out that an article published in the Journal of the American Medical Association suggests marijuana may reduce opioid deaths by 25% in places where marijuana is legal. He asked, “How many dead bodies before politicians sort this out? If we don’t make it a business it goes into back alleys, parks, schools, etc. Let’s end the propaganda, pick some zones, and get this moving.”

Questioned by Planning Commissioner Kathy Boyle about the legal risk involved in the marijuana industry since the drug is still a Schedule 1 narcotic under federal law, Hank responded, “We need to have a legal showdown between the state and the feds.”

Anne Hill, Chairperson of the Hawk Nest Homeowners’ Association, spoke against the zoning proposed by Ordinance 1395 “from a land-use perspective.” She described an existing community that includes “single-family homes, a beautiful park, more than fifty-percent of homes occupied by children,” and steady property values threatened by an industry with “serious reliability issues.”

One zoning type listed in draft Ordinance 1395 as eligible for the industrial side of marijuana operations was B4, and Hill explained that the largest B4 area is that near Hawk Nest and bordered by State Road, Route 127, Coolidge Road, Lake Lansing “and beyond.” Placing marijuana facilities in that area would, according to Hill, “impact existing housing, including her own neighborhood.

Hill (shown below) added that “Chandler Crossing [is an] area that has changed dramatically,” as more non-students have moved in. She noted increased criminal activity there and said that a marijuana-growing facility would “act as a magnet for criminals.” She added that production and grow facilities are “known to have a noxious odor like a pig farm” and predicted that since Hawk Nest would be directly in path of such odors, property values would decline. She asked that the Commission oppose Ordinance 1395.

Another Hawk Nest resident, Ellen Marr, joined Hill in opposing allowing marijuana-related facilities near their neighborhood and said that her family would consider leaving East Lansing if Ordinance 1395 passed. Her concerns included “raising children in that environment,” and East Lansing’s inability to afford the cost of crimes associated with a large grow facility. Marr also noted that she works with wives of Clinton County Sheriff Department officers who joke about the relevant corner of East Lansing being “little Detroit” because of the level of crime.

During the formal public hearing on Ordinance 1416 which, to reiterate, focuses solely on zoning for provisioning centers, the Commission heard from many of the same speakers.

Jeff Hank reiterated the profitability of the marijuana industry, and said that the current B5 zoning for such businesses is “unworkable” while zones B2 and B3 are desirable locations. He added that “there are potential projects just waiting on the city” that have not been launched because of the existing zoning.

Chris Woodruff told the Commission that he’s currently in the marijuana business, and that “this industry is one of the shining things that a lot of people are looking at to improve their situations.”

Commissioner Don Davis asked Hank if he had information about “stench,” crime and reduced property values from states that have legalized marijuana, like Colorado. Hank responded that the state will likely have rules on odor mitigation and cited a UCLA study showing that when legal dispensaries were closed, crime went up.

Hawk Nest Board member Ryan Smith encouraged the Commission to learn from the example of Lansing, and “be sure we are taking time to come up with policy that’s best for everybody involved.” He pointed out that East Lansing “doesn’t have a lot of room for zoning for these facilities” and asked why the City couldn’t “just have dispensaries” because of the potential issues with growing, processing, and other larger-scale operations.

Anne Hill spoke again, telling the Commission that “the issue seems incredibly complex and we’re trying to push it through by December 15th.” Hill added that the issue “wasn’t on anybody’s radar,” and that it’s “too big an issue for us to try to ram through.”

The Commission’s discussion of Ordinance 1416 and provisioning centers was limited, mainly due to the Commission’s stated plan to wait and see what Planning staff did with Ordinance 1395. Newly-appointed Commission Chair Daniel Bollman (below, left) suggested that the group give suggestions to Planning staff member David Haywood (below, right), with directions that he should pass them on to City Attorney Tom Yeadon for revision.

Commissioner Kathy Boyle supported this idea, and added that revisions to Ordinance 1416 should be made based on any changes made to Ordinance 1395.

Commissioner John Cahill asserted that the Commission “should deal with 1395 first or we’re going to ‘blow our brains out’ trying to deal with 1416 language that doesn’t reflect updates to 1395.” Cahill also noted that the functioning of provisioning centers would largely be regulated by rules set by LARA, the state agency that grants licenses related to alcohol and medical marijuana.

The Commission ultimately agreed to recommend zoning for provisioning centers in B2, B4, and B5 areas and operating hours of 8 a.m. to 9 p.m. (This recommendation is advisory to City Council, which will make the final decision.)

The Commission discussed Ordinance 1395 in greater detail, mostly in terms of which zones would be the best fit for growing, processing, secure transport, and/or testing facilities. The draft of Ordinance 1395 initially included only RA, B4 and B5 zoning and suggested adding B1 and OIP (Office/Industrial Park) as possible locations because the owner of an existing laboratory facility wanted to be a marijuana testing facility and his business was already located in a B1 (general office district) and couldn’t test marijuana unless they changed the zoning.

That laboratory is Merit Laboratories, located at 2680 East Lansing Drive, just southwest of the intersection of Saginaw Highway and Park Lake Road. At the September 12, 2017, meeting of City Council, attorney Mikhail Murshak came to speak to Council on behalf of that company, which is owned by his family and has been operating as a scientific testing lab in East Lansing since 1987.

Murshak (above) told Council that the lab’s accrediting agency had recommended they get into the business of testing marijuana for safety and potency because they were set-up well to take on this “very technical operation.” He has been encouraging Council and the Planning Commission to allow for zoning that will permit Merit Laboratories to be a marijuana testing facility. That company is in an area currently zoned B1. (See zoning map for north side of the City here and south side here.)

On Wednesday night, the Commission ultimately voted unanimously to recommend allowing safety compliance (testing) as permissible in zones B1, B2, and OIP, and to remove zoning for growing facilities from the RA, B4 and B5 areas, which include the controversial area near Hawk Nest, and to allow them in M1 (Manufacturing District) and OIP zones because of their perceived compatibility with indoor growing operations.

They also voted to allow processor facilities in M1 and OIP, but not in B4 and B5, and to allow secured transport facilities in B1, B2, M1, and OIP. The Commission also recommended approval of 1395 as amended and sent it on to City Council for decision.

City Council is now set to make the next round of decisions on these issues, although sometimes Council sends matters back to Planning Commission for additional review.

Contributed reporting from Alice Dreger.