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Volume 3, Issue 5 (Midsummer Night's Dream 2017)
Welcome to the Miyares and Harrington LLP e-Newsletter, Midsummer Night’s Dream edition! We are very happy to present our loyal readers with some significant changes in the law, originating in the State Legislature and by operation of judicial decisions.
We are also happy to announce that our own Ivria Glass Fried has been appointed to the Local Economic Development Working Group of Treasurer Goldberg’s Alcohol Task Force.
This edition includes the following topics:
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Let’s Get Down to Grass Tax: Changes to the Recreational Marijuana Law Are Approved
Last year’s statewide Referendum vote on Question 4 legalized the recreational use and personal cultivation of marijuana for adults 21 years or older. The Question 4 vote established a three-member Cannabis Control Commission (CCC), which was charged with drafting the regulations that would be applicable to the recreational marijuana industry in Massachusetts. The CCC was given plenary powers over the licensure of marijuana establishments, which includes facilities that cultivate, process, distribute, and sell the finished marijuana products at retail stores. Referendum voters also approved a 12% tax on the sale of recreational marijuana, which was comprised of the 6.25% sales tax, a 3.75% state excise tax, and a local-option sales tax of no more than 2%.
On July 28, 2017, Governor Baker signed Chapter 55 of the Acts of 2017 into law, making wholesale changes to the law as passed by the voters:
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The new recreational marijuana tax can be up to 20% of the sale price and is broken down as follows: a 6.25% sales tax; a 10.75% state excise tax; and a local-option tax of up to 3% that cities and towns may set.
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Cities and towns where a majority of voters in the 2016 Referendum voted against marijuana legalization may, prior to December 31, 2019, ban or impose limits on the number of marijuana establishments within their boundaries without holding a second voter referendum.
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Cities and towns or cities where a majority of voters in the 2016 Referendum voted in favor marijuana legalization may also ban or limit the number of marijuana establishments if so authorized by a local referendum vote.
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After December 31, 2019, all cities and towns will be required to obtain voter approval by a referendum in order to ban or limit the number of marijuana establishments.
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The law prescribes a set of specific procedures for local ballot questions to authorize ordinances or bylaws that ban or limit the number of marijuana establishments.
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Cities and towns are required to enter into a host community agreement with any new recreational marijuana establishment or medical marijuana treatment center prior to their licensure. The Agreement must set forth all stipulations of responsibilities between the community and the marijuana establishment or treatment center. There are also strict requirements governing the imposition of an impact fee. For a discussion of the key components of a Host Community Agreement, see our outline here
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The CCC’s membership will now have five members, who must be appointed by September 1, 2017. The Governor, the Attorney General and the State Treasurer each may appoint one member, and the three members so selected will appoint the remaining two.
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The CCC must promulgate regulations governing testing facilities by May 1, 2018. All other CCC regulations must be adopted by March 15, 2018.
The CCC will begin issuing licenses on June 1, 2018.
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U.S. EPA Postpones Effective Date of Massachusetts Municipal Stormwater General Permit
On June 29, the Environmental Protection Agency’s Region 1 office announced that the effective date of EPA’s General Permit for Stormwater Discharges from Small Municipal Separate Storm Sewer Systems (“MS4s”) in Massachusetts would be postponed from July 1, 2017 to July 1, 2018. The permit is currently under appeal in the D.C. Circuit by Massachusetts municipalities and others. The municipalities requested that EPA postpone the permit’s effective date so that they would not have to expend resources to comply with requirements that may change due to the appeal.
However, this development does not mean that municipalities should shelve their stormwater discharge compliance programs. First, environmental groups may go to court to challenge the postponement. Second, MassDEP, which jointly issues the permit under its state law authority, has not yet announced its position on the postponement. Finally, the requirements of the 2003 MS4 permit will remain in place until the new permit takes effect. Therefore, municipalities should continue implementing the requirements of the 2003 permit and should watch this space for updates on the status of the new permit.
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Conservation Commissions Retain Jurisdiction Under Local Ordinances and Bylaws in the Face of a DEP Superseding Order of Conditions under the WPA
The Massachusetts Appeals Court recently upheld an order of conditions (OOC) issued by the Attleboro Conservation Commission (Commission) for the construction of a subdivision roadway and utilities, which the applicant appealed because it included a condition to which the applicant objected. The July 14 decision in Cave Corporation v. Conservation Commission of Attleboro
affirms local authority to require consideration of cumulative and indirect effects under a home rule wetlands ordinance or bylaw. It also affirms a conservation commission’s power (under an appropriate bylaw or ordinance) to impose conditions on an entire parcel proposed for subdivision. Miyares and Harrington LLP argued this case before the Appeals Court and is pleased to have assisted the City of Attleboro in securing this victory.
The case involved intertwined proceedings before the Commission. In December 2013, Cave filed a notice of intent (NOI) with the Commission proposing construction of a roadway, drainage infrastructure, and utilities associated with a proposed “open space” subdivision, to consist of seven building lots and an eighth lot to be preserved with a conservation restriction. The NOI identified two vernal pools on the property. Although the vernal pools themselves were located within the proposed conservation restriction area, the surrounding vernal pool habitat and buffer zone (protected under the City’s Wetlands Ordinance) extended onto some of the proposed building lots.
The Commission closed the public hearing on November 5, 2014 and issued OOCs under both the Massachusetts Wetlands Protection Act and the Attleboro Wetlands Protection Ordinance on November 12, 2014. One of the conditions in both orders stated that no additional work would be allowed on any of the lots within the proposed subdivision within 125 feet of the vernal pools. This condition had the practical effect of preventing the development of proposed Lot 7.
Meanwhile, on October 14, 2014, Cave submitted NOIs for construction of homes and related work on Lots 4, 5, 6, and 7 of the proposed subdivision. The Commission opened the hearing for these NOIs on November 5, 2014 and subsequently issued OOCs. The OOC for Lot 7 was a denial of the proposed work, some of which would have been within 125 feet of the vernal pools.
Because the Lot 7 hearing was opened after the 21-day deadline imposed by the Act, Cave immediately requested a superseding order of conditions from MassDEP. Cave also requested a superseding order of conditions for the roadway because it objected to the condition prohibiting work near the vernal pools. DEP issued superseding orders acceptable to Cave.
Cave then went to Superior Court to challenge the OOCs issued under the Ordinance. It argued that MassDEP’s superseding order barred the Commission from prohibiting future work within 125 feet of the vernal pools. The Commission argued to the court that, because the Attleboro Ordinance requires consideration of cumulative and indirect effects, it had the authority to impose the disputed condition. The Superior Court agreed with the Commission and upheld the roadway OOC.
Affirming the Superior Court’s decision, the Appeals Court stated that it would be “anomalous indeed for the DEP’s superseding order of conditions for lot 7 to abrogate the terms of a previously and validly issued order of conditions regulating that lot simply because the same land was the subject of additional work described in a subsequently filed notice of intent.”
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A New Test for Regulatory Takings of Merged Lots
In a recent regulatory takings decision, Murr v. Wisconsin, 137 S. Ct. 1933 (2017), the U.S. Supreme Court reaffirmed the commonly applied rule that undersized lots held in common ownership are deemed to have “merged” for the purpose of applying local zoning requirements.
The Murrs owned two adjacent lots along the St. Croix River—lot E and lot F—which, due to topography, had less than an acre each of land suitable for development. Their parents had purchased the two lots in the 1960s and maintained them separately before conveying lot F to the Murrs in 1994 and lot E in 1995. Under Wisconsin law, these conveyances, because they put both lots under common ownership, “merged” them into a single parcel and consequently barred separate sale or development under local regulations.
A decade after the merger of the lots, the Murrs sought a variance in order to sell the land that was previously lot E to finance improvements to the land that was previously lot F. The County Board of Adjustment denied the request, and the Wisconsin Court of Appeals affirmed, ruling that the Petitioners could sell or build on only the single combined lot.
The Murrs then filed a second suit alleging that the ordinance constituted a regulatory taking. Both the trial court and the appeals court ruled in favor of the state, with the appeals court finding that the takings analysis properly focused on the Murrs’ property as a whole—that is, the merged lots.
In affirming this decision, the Supreme Court set forth a three-factor test to determine the precise property at issue in a regulatory takings analysis. This new Murr test can be used to answer the objective question of whether reasonable expectations about property ownership would lead a landowner to anticipate that a property would be treated as one parcel or separate tracts:
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How the property is treated under state and local law, particularly how it is bounded or divided. This factor is given special weight.
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The property’s physical characteristics, including the physical relationship of any distinguishable tracts, topography, and the surrounding human and ecological environment.
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The property’s value under the challenged regulation, with special attention to the effect of the burdened land on the value of other holdings.
M.G.L. c. 40A, §6 similarly merges lots held in common ownership for zoning purposes. The Supreme Court’s factors, then, can be helpful in adjudging whether treating separate lots as merged works a regulatory taking.
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Trivia!
Question: How much was John Adams paid to defend the British soldiers accused of perpetrating the 1770 Boston Massacre?
Last issue’s question: Credited with the birth of the industrial revolution in the U.S.A., what city in Massachusetts was the first planned industrial city?
Answer: Lowell, Massachusetts. Francis Cabot Lowell was the driving force behind the Boston Associates and the namesake of the country’s first planned industrial city.
Congratulations to Blake Martin, Vice President, Environmental Resources Manager at Weston & Sampson for wining the race to provide a correct answer!
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THIS NEWSLETTER MAY BE CONSIDERED ADVERTISING UNDER MASSACHUSETTS SUPREME JUDICIAL COURT RULES. This newsletter is intended for clients and friends of Miyares and Harrington LLP. It provides general information about legal developments and should not be used as a substitute for professional advice on your particular legal situation
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