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Oregon Real Estate | How is Recreational Marijuana Use in Oregon Impacting Real Estate?
At the Oregon Association of Realtors' annual conference last week, several presentations touched on recreational marijuana use within the state. We are now 1 year into legalized recreational marijuana and some of the rules and regulations which govern this use have been implemented. Anyone who wishes to engage in the growing, distribution or sales of recreational marijuana needs to be aware of these rules and regulations but also aware that the possession, growth and distribution of marijuana remains a federal crime subject to prosecution, should the Department of Justice ever choose to enforce the federal laws; the Cole Memo has outlined that at the present time, the federal government has elected to keep away from enforcing drug laws in states which have legalized marijuana use.
In Oregon, several counties - mostly in Eastern Oregon - have decided to keep the growing and distribution of marijuana illegal. In Deschutes county, the county commissioners just recently voted to allow marijuana grow operations, despite significant opposition. Counties which have permitted the growing and distribution of recreational marijuana, several items should be considered:
- Local law can dictate terms and even make the growth and distribution illegal
- Right to farm laws allow for marijuana growth and can keep neighbors from suing for the odor
- Grow operations must have water rights, but none of these can come from federal water
- Growth for personal recreational use are subject to CC&R's and city laws as well as requirements of Oregon Liquor Control
- Landlords and sellers can refuse to rent or sell to those planning to use or grow marijuana as this is not a recognized status under Fair Housing
- Sellers who have had grow operations on their property must disclose this to future buyers
- Title companies are refusing to issue title policies on property which will be used as grow operations
- All sales with marijuana are conducted in cash
- No federal backed loan will be issued for people wishing to finance grow or distribution businesses
- Taxes are currently 17% for state and 3% local for marijuana sales with no present cultivation tax
- For people who purchase properties which have had indoor marijuana grow operations, significant inspection issues should be carefully researched. In particular, inspectors should look for moisture problems (i.e. mold), venting issues and non permitted electrical changes which could create fire danger.
It remains to be seen how legalized marijuana laws will continue to evolve within Oregon and how they will impact Bend Real Estate.