The vote in Lebanon wasn’t overwhelming, but the message was clear.

Residents voted “No” on six referendum questions this month, prohibiting all varieties of recreational cannabis businesses and making the rural York County town the first in southern Maine to become a “dry town” in a state with newly legalized recreational marijuana.

York is holding a similar referendum Saturday and could join Lebanon on a small but growing list of Maine towns considering closing the door on the new legal marijuana market that is expected to launch next year, after lawmakers set up a regulatory system to oversee the industry.

“It’s the most clear-cut, unambiguous action a town can take,” said Ted Kelleher, an attorney with Drummond Woodsum who leads a practice group focusing on highly regulated markets, including marijuana. “It avoids the need to have to face a lot of the other more complicated, difficult questions about where you would permit these stores and how many you would allow.”

Municipal officials across the state are grappling with the impact that retail marijuana could have on their communities. Even with the uncertainty of how state regulations will work, town officials are wading through a host of issues, from developing local zoning and licensing to deciding on appropriate regulations for things like odor and signs.

Dozens of communities – from the largest cities in southern Maine to small towns in rural counties – have passed temporary moratoriums banning marijuana businesses while officials hammer out those details. Now, some towns are taking the next step and saying “No” indefinitely.

In December, the Kennebec County town of Oakland became the first dry town in Maine. Residents in Norway and Skowhegan will vote in June on ordinances to ban marijuana businesses and social clubs. In Saco, city councilors are considering an ordinance to ban recreational marijuana business for a year.

“There’s a small but growing number of towns that have said they don’t want these businesses, regardless of the regulations,” said Eric Conrad, spokesman for the Maine Municipal Association.

‘I’ve looked at this right from the start from a pure economic standpoint: How will this benefit York? Where do you think that tax money is going to be going? Straight to Augusta.’ — Jon Speers, vice chairman of the York Board of Selectmen

Even in towns that ban retail marijuana businesses, personal cultivation and use by adults 21 and older remains legal. Towns only have the right to ban sales and other related businesses.

Kelleher said there are three approaches towns can take to dealing with recreational marijuana. Towns could decide not to have local rules regulating marijuana – a scenario Kelleher hasn’t yet seen and says is unlikely – and treat marijuana businesses like any other business. Officials also can develop local zoning and regulations to fit the needs and desires of the community, such as designating where in town the businesses are appropriate and where they are not. For towns without comprehensive plans for zoning or no desire to be known for marijuana businesses, the easiest option may be to go dry.

While conversations in towns considering banning marijuana businesses often center on zoning and local opposition, some local officials also are discussing the financial implications of allowing them. They argue that allowing cannabis businesses will create more work for town staff – especially code enforcement officers – with no direct benefit to the town from the sales taxes that will be collected. Under the law approved in November, recreational marijuana will be taxed at 10 percent and all tax revenue goes to the state’s General Fund.

“I’ve looked at this right from the start from a pure economic standpoint: How will this benefit York?” said Jon Speers, vice chairman of the York Board of Selectmen. “Where do you think that tax money is going to be going? Straight to Augusta. We’re not going to see any retail sales tax on these operations.”

David Boyer, Maine political director for the Marijuana Policy Project, said financial benefits could come from the new businesses being destinations, similar to craft breweries that attract visitors. But there also seems to be some support in Augusta for proposals that would allow a local option sales tax on cannabis businesses, he said. That would mean towns could collect their own sales tax on marijuana sales.

“We don’t do that in Maine, but this is one area where it could make sense,” Boyer said. “Conversely, maybe the towns that ban stores and social clubs should not get the revenue.”

LEBANON SAYS NO, FOR NOW

Lebanon, a western York County town with about 6,000 residents, sits on the border with Rochester, New Hampshire. Route 202 runs through rural town, which has a small commercial tax base.

In November, 56 percent of voters supported marijuana legalization and the town is home to several medical marijuana growing facilities. But, like many small towns in Maine, Lebanon does not have a charter or a comprehensive plan.

“Without a comprehensive plan, we don’t have a form of zoning, and zoning is the way to regulate these facilities,” said Richard “Chip” Harlow, chairman of the Lebanon Board of Selectmen. “It was realized that we needed to slow the process down to figure out what we needed to do.”

Planning Board members attended sessions hosted by the Maine Municipal Association to learn about the issues municipalities would face and sent out multiple surveys to residents to gather input. They also hosted two informational meetings, where residents spoke for and against banning marijuana businesses, Harlow said. Ultimately, town officials decided to put six questions on the May 9 ballot.

The first ballot question, approved by a 529-397 vote, established a moratorium on retail marijuana businesses and social clubs. The other five referendums also passed, establishing bans on specific types of marijuana businesses: stores (529-397), social clubs (566-360), testing facilities (515-409), manufacturing facilities (515-411) and cultivation facilities (471-381).

Harlow, who was elected in the same election and closely followed the marijuana discussions leading up to the vote, was surprised by the results given Lebanon’s support for Question 1 last year and the presence of medical marijuana businesses in town. It’s possible a resident could circulate a petition to have a people’s referendum to reverse the new ordinances, he said.

“My guess is that will be attempted at least once,” Harlow said. “The votes weren’t totally lopsided.”

The town also is starting the process to develop a comprehensive plan. Then, if the ban is ever overturned, the town would have the ability to develop zoning for marijuana businesses, Harlow said.

YORK HAS SAID NO BEFORE

York’s history with recreational marijuana goes back to 2014, when the Board of Selectmen blocked an attempt by advocates to get a local legalization measure on the town ballot. It was the first town in Maine to reject citizens petitions calling for referendum on the legalization of recreational marijuana use, a decision that was later held up in York County Superior Court.

Two years later, York residents voted against the statewide legalization measure, 4,613 to 4,272. Shortly after, the Board of Selectmen began talking about what legalization meant for the town, but there was little clarity from Augusta on how the retail market would be structured.

“All of us were operating a little in the dark because we don’t know what our neighbors are going to be doing,” said Speers, the outgoing vice chairman of the board. “We didn’t want to sit around and do nothing and see what unfolded in the state.”

During public meetings where marijuana was discussed, residents who spoke to board members made it clear that they support the ban, said Chairman Robert Palmer. Many shared his concerns about whether marijuana shops and social clubs are a good fit for the town.

“We’re the first exit off the Maine Turnpike going north. We’re known as a family beach place and I had concerns about what this would do to the town if we had stores and social clubs right off that exit,” Palmer said. “At the end, it came down to the fact we ought to give the York voters a chance to say ‘Yes’ to a ban because they voted ‘No’ in November.”

Palmer said having the vote in May will give town officials time to react if voters decide not to ban marijuana businesses. Town leaders then would have time to discuss where to allow stores and social clubs and how many to license, then send those recommendations back to voters before retail sales start sometime in 2018.

Boyer, of the Marijuana Policy Project, wasn’t surprised to see York is considering a ban, and the law passed by voters provided strong local control to allow towns to do it. But he also thinks it’s premature for towns to shut the door on legal marijuana businesses.

“They’re just banning legal marijuana sales, they’re not banning all marijuana sales,” he said. “There will still be marijuana transactions in Lebanon and York, but it will be on the black market.”

Gillian Graham can be contacted at 791-6315 or at:

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Twitter: @grahamgillian

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