Oregon Marijuana: A Bump in the Road for Rural Residential Grows

RRLast week, the Oregon Land Use Board of Appeals (LUBA) ruled against a certain cross section of pot growers in the state. The Petitioners at issue wanted to grow medical marijuana on land covered by a “rural residential” zoning designation. When Jackson County adopted a zoning ordinance prohibiting such activity, the growers sued. Because LUBA sided with the County, medical marijuana grows in that jurisdiction will be limited to land zoned exclusively for farm (EFU), forest or industrial use. In that sense, the ruling is fairly narrow, although it could discourage prospective litigants in other counties on similar appeals.

As covered in the LUBA decision itself, the zoning change was consistent with Jackson County’s Comprehensive Plan and ORS 475B.500, which allows cities and counties to adopt “reasonable regulations on the operation of marijuana grow sites.” The Board found that a county keeping medical marijuana grows off rural residential land is “reasonable” for a couple of reasons, including that there are over one million acres of land in Jackson County that remain suitable for marijuana cultivation under the new ordinance.

The growers took an interesting approach to the “reasonable regulations” issue; they first argued that marijuana production is an exercise in free speech under the First Amendment of the Constitution. Due to this broad protection, the growers argued, the County’s zoning amendments would have to serve a “significant government interest” to withstand scrutiny. As you might expect, LUBA dismissed that argument quickly. More compellingly, the growers also argued that marijuana is now a “crop” under Oregon statutes, and the County did not prohibit other “crops” from being grown on rural residential land. In response, LUBA pointed to the large amount of land still  available for medical marijuana grows even outside the rural residential context.

Though not mentioned in the opinion itself, LUBA surely took note of how Jackson County entertained significant public input before adopting the zoning regulations. Local jurisdictions tend to do this ahead of controversial decisions. In theory, the jurisdictions want to gain as much public input as possible before making impactful decisions; but cynics argue that this process affords only the veneer of democracy, designed to insulate government from criticism and lawsuits. In our experience, early advocacy may be fruitful, if the approach is correct.

As further background to this case, LUBA also surely understood that farmers who had been on rural residential land prior to the ordinance can still “grandfather in” as a non-conforming use under Jackson County Code. We have worked on this issue with growers all around the state, as most local land use codes contain a section on non-conforming uses and vested rights. These concepts allow people to continue to operate as they had operated before a zoning change, even after the change occurs. As such, the only people that should be effected by this decision are those who will resist paying the fee to grandfather in, and those who had not yet begun to operate on rural residential land when the ordinance passed.

The growers in this case have vowed to fight on, which means a date in the Court of Appeals. They will argue, as they did in the press last week, that “it is hard to understand how an ordinance that stops 3,500 farmers from producing medicine for their patients is a reasonable regulation.” It is possible, but unlikely, that they will win. Meanwhile, prospective litigants around the state will have some food for thought when it comes to challenging local land use regulations.

Fortunately, there will be opportunities to distinguish the claims brought by the Jackson County growers, which are limited to a certain class of land in a certain county. This adverse decision should have only minimal impact on the Oregon cannabis industry’s momentum overall.