RECREATIONAL MARIJUANA HITS MASSACHUSETTS: WHY EVERY CONDOMINIUM NEEDS TO AMEND THEIR DOCUMENTS TO PROHIBIT SMOKING, GROWING AND SELLING MARIJUANA.

Published on: December 30, 2016

On December 15, 2016 the recreational use of marijuana became legal in the Commonwealth of Massachusetts, after voters on election day approved Ballot Question 4 The Regulation and Taxation of Marijuana Act. Personally, I do not think that everyone knew what they were voting for. The new recreational marijuana law did not simply legalize or decriminalize marijuana. The new law recognizes that Marijuana is big business and it encourages it as big business because the Commonwealth wants to tax it.

 

This new recreational marijuana law contemplates the licensure of recreational marijuana dispensaries. This means that soon anyone (over the age of 21) will be able to walk into a store and purchase marijuana in various different forms, from the traditional kind that you smoke to oils, edibles (yes they make marijuana gummy bears), etc. Many condominiums in Boston and the surrounding communities have retail or commercial units. Condominiums have to ask themselves do they want a recreational marijuana dispensary on the first floor of their posh condominium. If Colorado is any example, these establishments will have heavy volume and customer traffic. Furthermore, because Marijuana is still illegal on the Federal Level, the recreational dispensaries have difficulty with banking institutions, meaning they have large amounts of cash on the premises. While marijuana might sound great, condominium owners have to ask themselves do they want a high volume of drugs and money in their building. Will those businesses be a target for crime? Will they pose a security risk?

 

Beyond selling marijuana, homeowners, whether they are single family or condominium or part of a homeowner association now are free to smoke marijuana in their homes and/or units. In condominiums where smoking is permitted, owners could and are expected to argue that another owners smoking of marijuana is a nuisance. While that might seem like an issue between owners, from a legal perspective, condominium boards are going to be expected to take action, whether it is with thin walls or ventilation systems that cause the smoke to travel from one unit to the next. If condominiums do not ban smoking in units, I can guaranty that they will be sued by unit owners who complain that the ventilation system is inadequate and has not been properly maintained to protect them from their neighbors migrating smoke. In light of the availability and legality of marijuana it makes sense to ban smoking to avoid these potential issues.

 

Smoking is not the only worry. Homeowners are now permitted to grow 6-12 marijuana plants in their homes. The rule is 6 plants if one adult lives in the premises 12 plants if multiple adults live in the premises. This rule seems shortsighted for a couple of reasons. Growing marijuana plants actually puts off a stronger odor than the smoke. I had one condominium contact me because they thought a unit owner had a dead skunk in their unit. It was marijuana plants. Growing marijuana plants indoors takes up a tremendous amount of electricity and water. Condominiums that do not ban growing may want to make sure that water and electricity are separately metered. It also presents a fire hazard.

 

The security risks, potential lawsuits, fire hazards posed by use of recreational marijuana could have an impact on insurance claims and coverages as well. Marijuana could be the new mold in terms of insurance exclusions, especially as it is still illegal on the federal level. Query if a building burns down because a unit owners growing operation catches on fire? Could an insurer deny the claim because the board was aware that a unit owner was engaged in illegal activity and did not nothing about it? Remember it is still illegal on the Federal level.

 

If any of these are of concern to condominiums, they should act quickly to adopt amendments, which would ban (1) recreational marijuana dispensaries, (2) smoking marijuana or (3) growing marijuana. It is conceivable if not probable that failure to enact bans could diminish property values and create other operational issues internally for a condominium.

 

What is Legal and Illegal Generally?

 

  • Adults (21 or over) may possess up to 10 ounces of marijuana in their primary residence. A person may cultivate up to 6 marijuana plants for personal use, and up to 12 plants per household are allowed if more than one adult lives on the premises. Marijuana growing at home must be done discreetly and securely. Marijuana plants cannot be plainly visible from the street or any public area and must be cultivated someplace where there is a security device.

 

  • Outside the home, adults 21 or over can possess up to 1 ounce of marijuana.

 

  • Recreational marijuana cannot be sold in any form in Massachusetts without a retail license. A Cannabis Control Commission, yet to be named, will be responsible for issuing retail licenses.       This is expected to become big business. Licenses are going to be sold for up to $15,000. The State wants the tax revenue. The State is encouraging this business because it is going to be a windfall in tax revenue. Commercial condominiums beware.

 

  • Marijuana cannot be possessed, purchased, grown or used by anyone under age 21 (unless they have a valid medical marijuana permit), and it’s against the law to give away marijuana to someone under 21 (yes the law authorizes people to give small amounts of the marijuana away to others—-another factor that could increase traffic and visitors in condominiums).

 

  • Using marijuana is illegal in any public place. It’s also illegal to use marijuana in any place where tobacco is banned.

 

  • Possession of any amount of marijuana remains illegal on school grounds, public housing, and government buildings.

 

Can Unit Owners Use or Cultivate Marijuana In Condominiums?

 

The key provision in the Act provides that this chapter shall not be construed to:

 

“prevent a person from prohibiting or otherwise regulating the consumption, display, production, processing, manufacture or sale of marijuana and marijuana accessories on or in property the person owns, occupies or manages, except that a lease agreement shall not prohibit a tenant from consuming marijuana by means other than smoking on or in property in which the tenant resides unless failing to do so would cause the landlord to violate a federal law or regulation.”

 

The above language makes it clear that condominiums can ban: (1) smoking, (2) distribution or sale, and (3) growing of marijuana. Landlords can do the same, for unit owners that rent their units should have riders to that effect if the Condominium does not ban it. The only exception is that the use and consumption of edibles cannot be banned in rental property. That exception could be extended to condominiums, edibles do not pose the same problems that growing and smoking do.

 

Master Deed Amendments

 

Since marijuana smoking, growing or retail or medical sale bans regulate the use of a unit, it would definitely require a Master Deed Amendment. This typically requires 67%-75% unit owner consent. While this seems like an undertaking, every Massachusetts Condominium should consider it in light of the expansive recreational marijuana law. I really think all Massachusetts Condominiums need to act immediately. I don’t think people really understand the breadth of question 4.

 

Utility/Water Usage

 

As mentioned above, growing and cultivating of marijuana can have a large impact on water and electricity usage. Not all condominiums have separately metered water and electricity. If condominiums do not want to ban marijuana outright, they may want to consider separately metering water and electricity, so that the entire community is not paying for the growing operation of a few.

 

For a copy of The Regulation and Taxation of Marijuana Act [click here].

 

MEEB’s Ed Allcock has drafted marijuana (medical and recreational) specific amendments. If you want to keep your condominium marijuana free going forward, please contact Ed at eallcock@meeb.com.