Medical Cannabis and Local Government

By Brian J. Skinner, Esq.

The West Virginia Medical Cannabis Act (West Virginia Code §§ 16A-1-1 et seq.) was signed into law by Governor Jim Justice on April 19, 2017. The Act has been amended by Senate Bill 1037 and House Bill 2568 in 2019, and Senate Bill 339 in 2020. Because of concerns of the banking industry related to the handling funds derived from the sale of medical cannabis, the program is not yet operational. However, those issues have now been addressed by amendments to the Act and the program is expected to be fully operational by the summer of 2021. 

The Act legalizes the possession and private use of cannabis by West Virginia residents who have been certified to have a serious medical condition. The forms of medical cannabis that may be sold are limited by law to pill; oil; topical forms including gels, creams or ointments; a form medically appropriate for administration by vaporization or nebulization, dry leaf or plant form; tincture; liquid; or dermal patch. To purchase medical cannabis at a permitted dispensary a person must be certified as having a serious medical condition by a physician and issued a card by the Office of Medical Cannabis.

Local Regulation

A county commission may prohibit medical cannabis organizations from operating in a county by referendum. A municipality may enact an ordinance prohibiting or limiting the number and type of medical cannabis organizations permitted to operate in the municipality, including the time, place, and manner of operation.

Counties and municipalities may not prohibit the private consumption of cannabis that is authorized by the Act. Municipalities may adopt and enforce local ordinances to regulate possession and public consumption of cannabis so long as the regulations and penalties are consistent with the Act.

Finally, the Act does not implicate clean indoor air ordinances that counties or municipalities may have in place as the Act does not authorize the smoking of medical cannabis.

Zoning

The Act preserves local zoning authority and directly authorizes municipalities to prohibit (opt out) or significantly limit the location of cannabis businesses by ordinance. Municipalities will have the authority to enact reasonable zoning regulations that are not in conflict with the act. Municipalities also may enact zoning ordinances and regulations designating the time, place, manner and number of cannabis business operations, including minimum distances between locations through conditional use permits.

Business Regulation

Generally, municipalities have legal authority to regulate businesses and other activity through zoning within their boundaries, as well as other activities where explicitly granted the authority by the legislature. In addition to zoning authority, municipalities may to require a municipal license or assess a business and occupation privilege tax.

Local Revenue

Sales of medical cannabis are subject to a state privilege tax of 10 percent of a dispensary’s gross receipts. The tax imposed may not be added by the dispensary as a separate charge or line item on any sales slip, invoice, receipt, other statement, or memorandum of the price paid by a patient, or caregiver. Most importantly, sales of medical cannabis are not subject to a special district excise tax imposed by a county or municipality, or to a county or municipal sales tax.

State Revenue

State revenues derived from the West Virginia Medical Cannabis Act will be deposited into the Medical Cannabis Program Fund.  Fifty-five percent of the revenue is allocated to the Office of Medical Cannabis to regulate the program, and the remaining 45% of the revenue is allocated to efforts to fight substance abuse and train local law enforcement agencies.

Employer Provisions

Employers may not discharge, threaten, refuse to hire or otherwise discriminate or retaliate against an employee regarding an employee’s compensation, terms, conditions, location or privileges solely on the basis of such employee’s status as an individual who is certified to use medical cannabis. However, the Act does not require an employer to make any accommodation of the use of medical cannabis on the property or premises of any place of employment. Nor does the Act limit an employer’s ability to discipline an employee for being under the influence of medical cannabis in the workplace or for working while under the influence of medical cannabis when the employee’s conduct falls below the standard of care normally accepted for that position. Additionally, the Act does not require an employer to do anything that that would put the employer or any person acting on its behalf, in violation of federal law.

An employer may prohibit an employee from performing any task which the employer deems life-threatening or which could result in a public health or safety risk, to either the employee or any of the employees of the employer, while under the influence of medical cannabis. This prohibition may not be deemed an adverse employment decision even if the prohibition results in financial harm to the employee.

Finally, a person with a blood content of more than three nanograms of active tetrahydrocannabis (THC) per milliliter of blood in serum may not operate or be in physical control of:

• Chemicals which require a permit issued by the Federal Government or a state government or an agency of the Federal Government or a state government;
• High-voltage electricity or any other public utility; or
• Vehicle, aircraft, train, boat or heavy machinery.

State Permitting

The Act authorizes the production and distribution of cannabis and cannabis products through state-permitted growers, processors and dispensaries. The state will issue permits according to a graduated scale. The Act limits the number of growers and processors to 10 each. The Act allows up to 100 dispensaries. All permits should be issued by end of 2020 and medical cannabis products should be available to patients by late-summer 2021.

Brian J. Skinner is the former General Counsel to the West Virginia Bureau for Public Health. He assisted the bureau in establishing the Office of Medical Cannabis upon enactment of the West Virginia Medical Cannabis Act by drafting procedures and legislative rules. 

This article contains general legal information and does not contain legal advice. H2C Public Policy Strategists, LLC is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.