Troy officials begin discussing cannabis rules
City councilors in Troy began clearing the smoke around how the municipality might regulate marijuana dispensaries last week.
Mayor Dallas Carr suggested his colleagues on city council begin considering potential regulations, citing an email from the municipality’s attorney that stressed the urgency of the matter, during a Dec. 8 meeting.
“If the city intends to regulate marijuana dispensaries — location (store front, home business?), number of them, hours, etc. — it needs to act now,” wrote City Attorney Clif Hayden in an October email.
Lincoln County voters, along with those in half the counties in the state, opted to legalize marijuana as part of an initiative on the 2020 ballot. The approval opens up the sale of recreational marijuana in these green counties on Jan. 1, albeit with a slew of restrictions and regulations handed down by Helena.
State law only allows medical marijuana facilities to venture into the recreational sector for the first 18 months of expanded legalization. Since there are no medical cannabis dispensaries within Troy city limits, the municipality has a bit of breathing room. Discussion among city councilors during the Dec. 8 work meeting focused on the bottom dollar. How might officials tax recreational cannabis sales emerged as the main question before Troy’s elected leaders.
“If the state’s going to tax … does every town tax it differently or do they all have to tax it the same?” Carr asked.
In recent months, local governments across the state have started exploring that question, State Sen. Mike Cuffe (R-Eureka) told councilors. In the lead-up to the expanded legalization, Missoula County voters approved a 3 percent tax on recreational marijuana in November. A similar tax for medical marijuana products failed, according to the Missoulian.
The state tax for recreational marijuana is set at 20 percent of retail sales. The state tax for medical cannabis will remain at 4 percent. Local jurisdictions may add a tax of up to 3 percent, according to the Montana Department of Revenue website.
Cindy Backeberg, a senior tax cannabis auditor, specified that “local jurisdictions” referred to counties rather than municipalities. Like in Missoula County, a local tax would need to garner voter support before going into effect. Counties may split tax revenues with municipalities.
City Councilor TJ Boswell pointed out that Troy would have to pair its municipal tax with a county tax if it wanted to see dispensaries open locally, anyway.
“If the county doesn’t put a tax on it, we would never have a dispensary open in Troy,” Boswell said. “They would just go to the county right outside city limits.”
Whatever the circumstances, mayor-elect and City Councilor Chuck Ekstedt said he would like to see the city capitalize on the expanded legalization.
“With it coming around, it’s something that we need to look at because there’s hundreds of thousands of dollars that are going to go out,” he said. “We’re not going to be able to stop it from coming in, even around here, so why not use it?”
Carr recommended the council continue thinking over regulations for future meetings. He said councilors had received information about the new state law well in advance of the December meeting but that other business, including the November election, had delayed talks.
“I’m just bringing this up. It’s nothing to decide on … this month but in the future now that it’s being done,” said Carr. “I think you’d better get on it and do something.”