As the adult-use marketplace begins to unfold in Vermont, the Cannabis Control Board has received a number of questions from municipalities relating to their regulatory authority. Some of the more commonly asked questions are answered below. Don't see your question answered? Contact us!
Municipal Frequently Asked Questions
Do municipalities need to opt in to host a cannabis establishment?
A municipality must opt in to host a retail cannabis establishment.
The opt-in vote requirement only applies to retail and the retail portion of integrated license types, and does not impact the ability for other license types to operate in a particular municipality. These other license types include cultivators, wholesalers, manufacturers, and testing laboratories.
The relevant statute provides: “Prior to a cannabis retailer or the retail portion of an integrated licensee operating within a municipality, the municipality shall affirmatively permit the operation of such cannabis establishments by majority vote of those present and voting by Australian ballot at an annual or special meeting warned for that purpose. A municipality may place retailers or integrated licensees, or both, on the ballot for approval." 7 V.S.A. § 863(a)(1).
A municipality may not use its regulatory authority to prohibit the operation of non-retail cannabis establishments.
If we don't opt-in, does that mean no cannabis establishments can operate in our town?
No. The opt-in requirement applies only to retail cannabis businesses and the retail portion of an integrated license. Even if a town does not opt-in, other cannabis establishments may still operate in the town as long as they meet all of the local zoning and ordinances, obtain all of the appropriate permits, and receive a license from the CCB. These other license types include cultivators, wholesalers, manufacturers, and testing laboratories, none of which require an opt-in vote to operate in a municipality. 7 V.S.A. § 863(a)(1).
What other authority does a municipality have to regulate cannabis establishments?
A municipality’s authority to regulate cannabis establishments is fairly limited.
General rule:
- Cannabis establishments are subject to the same zoning rules and municipal ordinances that apply to any business. Beyond municipalities' general authority to create and enforce zoning rules or ordinances that apply to all businesses, they do not have the power to create special rules for cannabis establishments.
A municipality may:
- Regulate cannabis establishments to the same extent they may regulate any other business under their authority to create zoning bylaws in 24 V.S.A. § 4414 and their authority to regulate signs or public nuisances in 24 V.S.A. § 2291. Municipalities may regulate any cannabis establishment license type in this manner. 7 V.S.A. § 863(b).
A municipality may not:
- Regulate cannabis establishments to any greater extent than they could any other business. 7 V.S.A. § 863(d).
- Place conditions on the operation of cannabis establishments, or create special rules for them, that is not within their zoning authority under 24 V.S.A. § 4414 or their authority to regulate signs or public nuisances under 24 V.S.A. § 2291. 7 V.S.A. § 863(d)(2).
- Use their zoning power under 24 V.S.A. § 4414 or their ordinance power under 24 V.S.A. § 2291 in a way that will have the effect of prohibiting the operation of cannabis establishments. 7 V.S.A. § 863(d)(1).
More information on municipal cannabis regulation may be found in the Municipal Guidance document on our guidance page:
What discretion does a town have to revoke, suspend or deny a license?
If the town creates a local cannabis control commission, the commission may suspend or revoke a local license for failure to comply with zoning bylaws under 24 V.S.A. §4414 or with ordinances regulating signs or public nuisances under 24 V.S.A. §2291.
The conditions that local control commissions can place on a license are limited to compliance with zoning bylaws under 24 V.S.A. §4414 and compliance with ordinances regulating signs or public nuisances under 24 V.S.A. §2291. Placing additional conditions on a local license, or suspending or revoking licenses for any reason other than the allowable conditions, is a violation of state law.
More information about municipal authority can be found in the Board’s municipal guidance document, available on the Board’s website: ccb.vermont.gov/guidance
If a town does not create a local commission, the local license provisions do not apply. However, all other health, life, safety, zoning, and ordinance enforcement mechanisms remain in force. Should an establishment not comply with local rules, the local government may still follow processes as it would with any other type of business.
Can a municipality indefinitely delay the review of a local license?
No. Local governments must process all permits and local licenses promptly and consistent with other statutory requirements. An indefinite delay would exceed the authority granted under 7 VSA § 863.
Is local approval required before a cannabis establishment is issued a license from the CCB?
If the town has created a local commission, yes. If a town chooses not to create a local commission, no such approval is required.
Please note: There is a difference between a license being “approved” and one being “issued.” A license may be approved by the Board, but it will not be fully issued until any license contingencies are met – including any relevant local permits.
Even if no local cannabis control commission exists, all cannabis establishments must comply with local regulations applicable to any business.
Will municipalities approve licenses for non-retail license applicants, such as outdoor cultivation?
Yes. If the local government chooses to create a local control commission, that body will review all types of licenses. If no local control commission is in place, the establishment will still need to follow all the typical processes for opening a business in the town. Still, a specific local cannabis license will not be required.
Can a local government limit the types of licenses it issues?
Example: Can an opt-in town only allow tier 1 retail licenses? Can a town allow for manufacturing licenses but not cultivation licenses?
No. Other than retail and the retail portion of an integrated license, which requires a town to opt-in, towns may not specifically limit the types of licensees operating in their town.
A municipality may regulate cannabis establishments to the same extent they may regulate any other business under their authority to create zoning bylaws in 24 V.S.A. § 4414 and their authority to regulate signs or public nuisances in 24 V.S.A. § 2291. Municipalities may regulate any cannabis establishment license type in this manner. 7 V.S.A. § 863(b).
More information about municipal authority can be found in the Board’s municipal guidance document, available on the Board’s website: ccb.vermont.gov/guidance
Can a town allow only social equity licenses?
The Board has prioritized the processing of social equity applications at the state level and is working with partners and affected communities to establish programs that will provide additional support for social equity applicants.
Municipalities, however, may not condition local license decisions upon social equity criteria. Nevertheless, towns are encouraged to support social equity applicants. For example, they may choose to hold local workshops or informational sessions to assist local applicants in moving through the local permitting and license process.
What does it mean if an applicant has a provisional license from the CCB?
If an applicant has received a provisional license (also known as pre-qualification) from the Board, it means the applicant has submitted an initial application and is provisionally approved for a license. A provisional license does not allow an applicant to begin operations, nor does it guarantee that an applicant will receive a final license to operate a cannabis establishment.
The provision licensing program is intended to allow interested applicants an opportunity to begin the application process and to have a provisional approval that may allow them to more effectively engage in commercial activities like contracting, negotiating potential leases with commercial building owners, and securing funding. The provisional license does not obligate the local government to approve a local license or any other type of permit.
Are all provisional licenses converted to operating licenses?
No. Provisional licensees will still be required to submit a final application for the Board's approval.
Does the local government have to follow the same licensing priority as the CCB? What impact does the priority of licensure have on local permitting?
7 V.S.A. § 903(a) outlines a system of priorities for the Board when issuing licenses. This does not directly impact the processing of local licenses. However, local governments are encouraged to engage with prospective cannabis establishments to discuss shared community values. Further, towns are encouraged to support Social Equity Applicants. They may choose to hold local workshops or informational sessions to assist local applicants in moving through the local permitting and license process.
What types of documents will cannabis establishments need from the town for their CCB application?
Applicants must attest that they are compliant with all relevant local bylaws and regulations when they are submitting their application to the CCB. For towns without a local control commission (LCC), no further documentation is required.
If a town has a local control commission, the LCC must submit documentation that they have reviewed and approved an application to the CCB in the form of meeting notes, and official statement, or some other form of written documentation. The CCB will only fully issue a operating license after receiving this information for towns with LCCs.
What if a municipality’s local water and wastewater requirements are more stringent than the CCB's rules?
Larger cultivators who operate on municipal water will be required to obtain a notice that the municipal water authority has capacity to serve the cultivation operation.
Can a local government create additional rules for sustainability, energy, waste disposal or other environmental concerns? What if our town already has more stringent bylaws?
Cannabis establishments must abide by all generally applicable environmental regulations, whether state or municipal. The Board will require some additional environmental standards, as provided in Board Rule 2, available at the CCB’s website: ccb.vermont.gov/laws-rules-and-regulations
Municipalities do not have authority to implement special environmental rules for cannabis establishments beyond their authority to create zoning bylaws with general effect.
More information about municipal authority can be found in the Board’s municipal guidance document, available on the Board’s website, linked here.
Will local governments be notified of changes in control of a business?
Cannabis establishments are required to notify the Board of changes of ownership and control. Information about ownership will be public.
What is a local Cannabis Control Commission?
7 V.S.A. § 863(b) provides that: "Any municipality that hosts any cannabis establishment may establish a cannabis control commission composed of commissioners who may be members of the municipal legislative body."
Any municipality may form a local cannabis control commission. However, creating a local cannabis control commission is not required for a cannabis establishment to operate in any town. Municipalities must give notice to the Cannabis Control Board if they have formed a local cannabis control commission.
How does a town form a local commission, and who is on it?
Municipalities that choose to form a local commission may seat members of their legislative body on the commission or decide to create a commission with members of the community that are not part of the legislative body. The composition of the local commission is up to the local government. How a commission is formed at the local level depends on your local government's policy practices.
More information on local cannabis commissions, how to form one, and how to inform the Board of your town's choice to form one, may be found on our guidance page: https://ccb.vermont.gov/guidance
What authority does the local Cannabis Control Commission have?
The local commission may issue and administer local control licenses and condition licenses to comply with bylaws under 24 V.S.A. §4414 and ordinances regulating signs or public nuisances under 24 V.S.A. §2291. The local commission may also deny, suspend, or revoke a local control license if it violates conditions placed on the license. Local commissions must inform the Board of such actions.
A municipality’s decision to form a Local Control Commission does not expand its authority under state law. A municipality that has formed a Local Control Commission may still only regulate, generally speaking, zoning, public nuisance, and signage.
More information on local cannabis commissions, how to form one, and how to inform the Board of your town's choice to form one, may be found on our guidance page: https://ccb.vermont.gov/guidance
Towns may also contact the Board in advance of the revocation or suspension. Please note that while the Board has the authority to grant and revoke state licenses and ensure compliance with the State's rules governing Cannabis Establishments, the Board does not have the authority to enforce compliance with local zoning bylaws.
Can a Local Control Commission choose to only review certain license application types (eg: choose to only review retail license)?
Yes, but the Local Control Commission must alert the Board of this decision. By default, the Board will send relevant application materials for all license types, unless the municipality informs the Board otherwise.
Municipalities may tell the CCB of their decision to only have their LCC review certain application types by emailing CCB.Info@vermont.gov.
Can cannabis establishments only operate in designated commercial zones?
No, there is nothing in state law or the Board’s rules requiring cannabis establishments to operate within a commercial zoning designation.
A town’s zoning bylaws may require a particular cannabis establishment to be within a commercially zoned district, but that will result solely from the application of the town’s bylaws and not from any requirement in state law.
Nowhere does Vermont law state that cannabis is a “commercial product,” and nowhere does the law require that cannabis businesses operate within designated commercial zones.
Is cannabis an agricultural product? If not, does that affect the zoning status of cannabis businesses?
No and no.
State law provides that cannabis is not an agricultural product and that cannabis cultivators will not be regulated as farming and will not receive certain tax and regulatory benefits are concerned. As a result, cannabis and cannabis cultivators will not receive certain tax and regulatory benefits that farms and agricultural products are eligible to receive.
These provisions are not relevant to zoning laws and have no effect on zoning.
A municipality’s zoning rules may require a certain type of cannabis establishment to operate within a particular zoning designation, but that will be determined on a town-by-town and business-by-business basis.
Does state law or the Board’s rules ever effect a local zoning designation?
No, state cannabis law and Board’s rules do not determine any zoning designation. There is nothing in state law or the Board’s rules requiring cannabis establishments to operate within a commercial zoning designation or any other zoning designation.
A town’s zoning bylaws may require a particular cannabis establishment to be within a specifically zoned district, but that will result solely from the application of the town’s bylaws and not from any requirement in state law.What role do other town governing bodies have in zoning cannabis establishments?
A municipality may regulate cannabis establishments to the same extent they may regulate any other business under their authority to create zoning bylaws in 24 V.S.A. § 4414 and their authority to regulate signs or public nuisances in 24 V.S.A. § 2291. Municipalities may regulate any cannabis establishment license type in this manner.
For example, an establishment that wishes to renovate or construct a building must obtain all the proper local approvals and permits, just as any other business would.
Per state law, towns may not create local bylaws or ordinances that have the effect of prohibiting the operation of cannabis establishments.
More information about municipal authority can be found in the Board’s municipal guidance document, available on the Board’s website, linked here.
What role does a local cannabis control commission have in creating buffer zones or other rules and restrictions on cannabis establishments?
Under Board rules, a retail cannabis establishment cannot operate in any location where it would be a violation of the drug-free school zone law to sell a regulated drug. This means cannabis retailers cannot operate if the store would be on a property that abuts a school property and if the retail operations would occur within 500 feet of the school property.
A municipality may regulate the location of cannabis establishments to the same extent it may regulate the placement of any other business under its zoning powers, but a municipality does not have authority to go beyond its general zoning power under 24 V.S.A. § 4414 in creating buffer zones that could apply to cannabis establishments.
More information about municipal authority can be found in the Board’s municipal guidance document, available on the Board’s website, linked here.
Do the Board’s buffer zones apply to license types other than retail establishments?
The Board’s buffer zone rule applies only to retail cannabis establishments and the retail portion of an integrated licenses.
Are there fees for Cannabis Establishments for local control licenses?
Yes. There is a local licensing fee of $100, to be paid by the licensed cannabis establishment to the Board. The Board will then distribute that fee to the town in which the cannabis establishment is licensed.
What role does the local cannabis control commission have in deciding how local options taxes or the cannabis excise tax is spent?
The local commission has no direct authority related to appropriations of the State's Cannabis Excise Tax. The authority to direct the revenue from the local options tax or any fees for local license processing is up to the town.
Can cannabis establishments make donations to town parks or other local funds?
There is no law or rule requiring that cannabis establishments donate funds to local parks or other funds. A town does not have the authority to condition a license on any donation. It is up to the town and local C.E.s to determine this type of donation. Further, it is important for the town to review the warning and advertising sections of proposed Board Rule 2 for limitations on the types of advertising and signage allowed in exchange for such a donation.
Will towns receive a portion of the excise tax to cover costs associated with cannabis establishments?
The excise tax on cannabis products will be 14%. Under current law, municipalities do not receive a portion of the cannabis excise tax. In its October 15, 2021 report to the legislature the Board recommended that municipalities get a portion of the excise tax.
What are the fees a municipality may charge for reviewing cannabis establishment applications?
The legislature has not approved specific local cannabis fee rates. The CCB has recommended that the legislature approve a local fee of up to $500 or, alternatively, allow municipalities to use the Uniform Fee Schedule set forth in 1 VSA 316(d) to charge applicants a variable fee based on the actual amount of time spent processing an application.
What is the town’s role in collecting fees?
Under Act 162 of 2020, the CCB would collect local license fees at the time an applicant applies or renews their application with the CCB and would pay them on a quarterly basis to the municipality in which the fees were collected. 7 V.S.A. § 846. This guidance will be updated with any process changes that may be legislated in 2022.
Does a local option tax apply to cannabis sales?
The Vermont Sales and Use Tax will apply to the retail sale of cannabis products in Vermont. Municipalities that have such a tax will receive local option tax revenue on retail sales of cannabis. The sales and use tax applies to all cannabis products.
Can a town adopt a local option tax only for cannabis sales?
Municipalities cannot add a local option sales tax solely for cannabis products. Municipalities that have a local option sales tax cannot exempt cannabis products from that tax. Municipalities must tax cannabis products as they would as any other good.
Does a meals and rooms tax apply to cannabis sales?
Meals and Rooms taxes do not apply to cannabis products, nor do they apply to edible cannabis products. Therefore, a local option tax on meals would not apply to the retail sale of any cannabis products.
How do I contact the CCB? My question isn't answered here.
Additional information on a variety of topics can be found on our website. Please review our guidance page (especially the documents on municipal guidance and local control commission guidance), as well as our general FAQ page prior to reaching out to the Cannabis Control Board.
If you still have questions, please visit our Contact Us page to find out how to best direct your query.
https://ccb.vermont.gov/contact