Oklahoma cannabis firms sue over residency, zoning laws

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(This story has been updated to include new information from an Oklahoma cannabis attorney.)

A group of medical marijuana businesses in Oklahoma have sued the state in efforts to prevent regulators from enforcing new definitions to a 1,000-foot school buffer zone and a stricter two-year residency requirement.

The disputes threaten to upset a fast-growing, free-wheeling market, and the school buffer rules are an especially thorny issue.

The MMJ businesses, which filed the lawsuit in Oklahoma County District Court, say the new buffer rules could affect “hundreds if not thousands” of licensed dispensaries, according to The Oklahoman.

Oklahoma cannabis attorney Sarah Lee Parrish told Marijuana Business Daily that the 1,000-foot buffer rule from a school has been in effect for some time. But regulators expanded the definition to include preschools and head-start programs, and measuring the 1,000 feet has been a moving target.

For example, what if a school adds a softball field on the side of the property closest to a dispensary?

Parrish said that if a dispensary was in compliance when it was awarded its license, then “to force the business to move (by denying a license renewal) likely would trigger great constitutional arguments.”

She said she successfully argued for a client last summer that had set up a dispensary at a location based on the National Center for Education’s SAFE (Schools are Far Enough Away) map. However, the dispensary was unaware of a school’s existence on the second floor of a nearby church building.

As for the stricter residency requirement, businesses issued a medical marijuana license before the law was enacted last summer are exempted.

But companies that applied for licenses between the enactment date of March 15, 2019 and its effective date of Aug. 30, 2019, are in limbo. The governor vetoed legislation that would have fixed that issue.

Fortunately, however, Parrish said the state regulators are treating those licensees in a “pending” status and she believes discussions to resolve the issue will be successful.

The Oklahoma Medical Marijuana Authority (OMMA), which regulates the industry, didn’t immediately respond for comment.

As of June 1, Oklahoma’s largely free-market MMJ industry had 9,266 active business licenses, including 2,035 dispensaries, according to the OMMA.

Medical marijuana sales in Oklahoma totaled nearly $300 million in the first five months of 2020.