eNews February 15, 2022Tuesday, February 15, 2022 - 05:18pm
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In this issue:
- FOIA and Disclosures bills that died along the way
- Bills that warrant local government support or opposition
- Bills of concern to local governments
- Legislative items of interest to watch
- Standing to appeal a historic district decision will remain unchanged
- Eminent domain bills continue to have issues for localities
Remaining marijuana bill moves forward
With the House having declined to act on its own marijuana legislation, Senate bill SB391 (Ebbin) has earned the distinction of being the only piece of marijuana-related legislation to be approved by either chamber of the 2022 Virginia General Assembly.
SB391 now incorporates elements of legislation that proposed allowing early retail sales by existing medical dispensaries and pharmaceutical hemp processors.
SB391 in a nutshell
- SB391 will allow the retail sale of marijuana and marijuana products from existing medical dispensaries to Virginians 21 and older starting September 15, 2022.
- It subjects these sales to a local option 3 percent tax.
- Early sales will be regulated by the Board of Pharmacy and allowed until the Cannabis Control Authority begins issuing licenses for the retail sale of marijuana and subsequently retail sales begin from these licensees January 1, 2024.
- SB391 also establishes local authority on a variety of issues including taxation, zoning, and land use, and allows localities to ban marijuana businesses by referendum in addition to setting up the state regulatory structure to regulate the retail market for marijuana with sales starting January 1, 2024.
- Notably, SB391 clarifies that towns have the authority to hold a referendum separate and apart from a surrounding county.
Local taxing authority for early retail sales was saved today!
Today – the final day the Senate is allowed to consider bills introduced in the Senate – SB391 was amended to incorporate the substantive elements of SB313 Senator Ebbin’s bill on early retail sales which provides the authority for localities to levy an optional 3 percent tax on early retail marijuana sales beginning as soon as September 15, 2022. Local taxation authority was inadvertently stripped from early retail sales yesterday because an amendment from Senator Morrissey to SB313. As communicated in our action alert yesterday afternoon, it is critical that localities retain local taxation authority on retail sales of marijuana. Were local taxation authority removed from early sales it would set a dangerous precedent and create the opportunity for the permanent removal of local taxation on marijuana retail sales by a future General Assembly.
Thanks for making a difference!
We appreciate everyone who contacted Senators to express concern over this development. As soon as this mistake was brought to the attention of Senator Ebbin and Senator Morrissey they worked to develop an amendment to reinsert local taxation authority in the legislation. We also appreciate the efforts of Senators Ebbin and Morrissey and the Virginia Senate to protect local taxation authority.
More about SB391
SB391 sets out the state regulatory framework for marijuana businesses and, more significantly for VML members, local authority to tax, make land use decisions and opt out of allowing marijuana businesses entirely. Highlights include:
Referendum to opt-out: Expanded
SB391 expands local authority to opt out of allowing marijuana businesses by referendum while also narrowing local land use control of marijuana businesses. The local referendum language has been amended to clarify that towns have equal authority to hold a referendum separate and apart from the surrounding county, this is a key change to the legislation as passed in 2021 and in keeping with VML’s legislative position on marijuana adopted at VML’s 2021 annual business meeting. The referendum language also expands the types of businesses that will be banned as the result of voters approving a opt-out referendum on marijuana businesses. Previously the legislation only allowed a locality to ban retail marijuana businesses; now the legislation allows a locality to ban all marijuana businesses. It is expected that the types of businesses subject to a referendum will be the focus of future amendments.
Land use authority: Limited
Land use authority is also affected by SB391 in that it pre-empts a locality from adopting “any local ordinance, zoning requirement, land use requirement, or business license requirement that regulates marijuana establishments unless such ordinance or requirement applies with equal force and effect to similarly situated businesses”. This change was recommended by the Cannabis Oversight Commission and is intended to limit local authority to treat marijuana businesses disparately.
Local authority to regulate hours of operation: Eliminated
Local authority to regulate hours of operation has been eliminated by SB391 with hours of operation for retail marijuana sales now proscribed as between the hours of 8:00 a.m. and 9:00 p.m. This was also a recommendation of the Cannabis Oversight Commission.
Local authority to object to licensees: Criteria established
There are criteria set forth in the bill that allow a locality to object to a license application as well as local objections more broadly. §4.1-809 sets out the criteria by which a license application may be refused by the Cannabis Control Authority, specifically sections 2-4 define the criteria by which a locality can object to specific applicants. This includes health and safety concerns, the proximity of a business to schools, day cares, playgrounds, residential areas, and other sensitive uses, as well as consideration of any local objections to a specific license application.
Local option taxes: Established
- 4.1-1004 establishes local authority to levy by ordinance a 3 percent tax on the retail sale of marijuana products. This is in addition to the 21 percent state tax as well as the Retail Sales and Use tax and any other applicable food and beverage taxes that may be applicable. Cities, counties, and towns are authorized to levy a 3 percent tax under this section and sets out criteria for notice to be provided to affected businesses of the local option tax.
As the House begins consideration of legislation that has passed the Senate expect additional substantive changes to be made to SB391. I encourage any interested member to contact me directly with questions or concerns.
VML Contact: Mitchell Smiley, firstname.lastname@example.org
K-12 Education: Crossover recap
School construction, modernizing facilities, renovating crumbling schools, funding public education, and fueling innovation have been some of the hottest points of discussion for the 2022 General Assembly Session. While everyone agrees something must be done to help public schools in Virginia, there is disagreement as to exactly what that something should be.
VML has been tracking several pieces of legislation recommended by the Commission on School Construction and Modernization that would greatly help localities and their schools. With crossover happening today, it’s a great time to review the education legislation we’ve been following.
Legislation that will not go forward
HB1099 (LaRock) was stricken. This bill would have allowed for a statewide local option sales and use tax.
SB276 (Stanley) was rolled into SB481 on a vote of 16 to 0. This bill would have addressed school board and local government collaborative agreements.
The following were tabled by a vote of 5 to 3:
- HB251 (Simonds) addressed school board and local government collaborative agreements.
- HB252 (Simonds) created a data reserve tool.
- HB253 (Simonds) increased the maximum loan amount in the Literary Fund.
- HB254 (Simonds) established a School Construction Fund and Program.
- HB608 (Bourne) negatively addressed school board and local government collaborative agreements.
- HB531 (Hudson) allowed for a statewide local option sales and use tax.
HB563 (O’Quinn) – A substitute to the bill passed the House 100 to 0. The substitute incorporates language from HB252 (Simonds) which would establish a data reserve tool for school divisions and HB254 (Simonds) which would establish a school construction fund utilizing moneys from the Gaming Proceeds Fund.
HB563 as introduced would create a School Construction Matching Grant Fund and Program to be used solely for school construction projects utilizing money previously appropriated to the Literary Fund. Grants would be rewarded based on need, commitment, and the LCI to ensure low-income school divisions would receive funds first.
SB471 (McClellan) – Passed out of the Senate on a vote of 40 to 0. This bill would increase the Literary Fund loan amount available for use by localities for school construction from $7.5 million to $25 million.
SB472(McClellan) – Passed out of the Senate on a vote of 28 to 12. This bill would provide statewide authority for a local governing body to impose a local option sales and use tax of up to one percent via referendum designated solely for school construction. Currently, only nine localities have this authority with three others asking for this authority during the 2022 General Assembly session.
SB473 (McClellan) – Passed out of the Senate on a vote of 37 to 2. This bill would establish a School Construction Grant Fund, funded through the Gaming Proceeds Fund which will receive future tax revenues from the casinos. Casinos in Virginia were established on the basis that 98 percent of the state tax revenues would be appropriated for school construction. As a mechanism to fulfill this promise, SB473 would create the fund to receive the casino revenues.
SB481 (McClellan) – Approved by the Senate on a vote of 40 to 0. This bill would codify the ability of local governing bodies and school boards to enter into agreements to allocate any unexpended funds at the end of a fiscal year. Currently, any unexpended school funds at the end of the year are returned to the local governing body unless the locality chooses to allow the funds to remain with the school division.
SB238 (McPike) – Passed out of the Senate on a vote of 40 to 0. This bill would create a data reserve tool to identify and collect information on the ages of school buildings in the Commonwealth. This tool would help to better funnel funds to school buildings that need it the most.
VML Contact: Josette Bulova, email@example.com
Status of behavioral health-related bills
Temporary detention / alternative custody bill lingers in the House
HB1147 (Bell) addresses alternative transportation for temporary detention and emergency custody orders. The bill, which appears to the only remaining bill in the House, was re-referred to House Courts from the House floor and has not re-emerged.
Alternative transportation and custody of persons bills clear the Senate
The Senate has passed the following bills that address issues related to alternative transportation and custody of persons with a temporary detention or emergency custody order; these bills will move to the House for consideration by that body:
- SB202 (Newman) directs the Secretary of Public Safety & Homeland Security and Secretary of Health and Human Resources to study alternative transportation and alternative custody arrangements.
- SB 268 (Favola) comprehensively addresses alternative transportation and alternative custody options; this bill incorporated several Senate bills.
- SB 593 (Newman) allows auxiliary police with training from the Department of Criminal Justice Services to provide alternative transportation and custody services for individuals with a temporary detention or emergency custody order.
The Senate also approved SB714 (Deeds), which directs the Department of Behavioral Health and Developmental Services to implement a voluntary mental health check-in option as part of the comprehensive crisis system and to report to the Governor and General Assembly on progress in implementing this option by Nov. 1, 2022. The Senate Finance and Appropriations Committee added the “clause” to the bill, which means the bill will not go into effect unless the final budget includes funding for it.
Marcus Alert bills move forward
The House has approved HB1191 (Ransome), which allows extra time for localities to implement parts of the Marcus Alert system and requires additional examination and work on the implementation requirements of the sweeping law. The Senate approved SB361 (Stuart), which would exempt localities with populations of 40,000 and lower from implementing portions of the law.
CSA bills set to cross over
The Senate approved SB435 (Barker) which removes existing prohibitions about certain parents serving on local Community Planning and Management Teams (CPMTs) and Family Assessment and Planning Teams (FAPTs) that are a part of a local government’s Children’s Services Act (CSA) program. The current prohibitions have to do with parents who work for organizations that receive CSA funds and who work either directly with children or who supervise those who do so. The bill would also require the CSA State Executive Council to compile information and recommendations/best practices regarding parental representation on these teams.
The House has similarly approved HB427 (Herring) which also addresses parental representatives on CPMTs and FAPTs. It also removes current prohibitions for service by parents who work for organizations that receive CSA funds but stipulates that these parents could be chosen to serve only if other parents are not available to serve. This bill also includes the requirement of the State Executive Council to report on parental representation.
Status of health department bills and studies
The Senate has passed SJR14 (Mason) which directs the Joint Commission of Health Care (JCHC) to study the Virginia Department of Health and the public health system in Virginia.
A House study asking the Joint Legislative Audit and Review Commission (JLARC) to perform a similar study of the public health system (HJR52 – Mullin) was tabled by the House Rules Committee.
The Senate has also passed SB192 (Mason), which broadens the qualifications for a local health director to include individuals with advanced degrees in public health and at least three years of experience. Currently only individuals with M.D.s licensed to practice in Virginia can be considered for health director positions.
Two studies to look at the Commonwealth’s response to the COVID-19 pandemic and ways to improve Virginia’s preparedness are moving forward: HB87 (Ware), which was passed by the House; and SJR10 (Surovell), which has been agreed to by the Senate. Both studies would include local government representation.
VML Contact: Janet Areson, firstname.lastname@example.org
Local Government Legislation
FOIA and Disclosures bills that died along the way
Numerous Freedom of Information Act (FOIA) and Disclosure bills are now no longer in play – they include the requirement that all FOIA requests have to be responded to with hard copy mail (HB331, Krizek), the requirement that the definition of meeting is less than a quorum (HB687, Kory), an attempt to allow advisory meetings electronically (HB722, Gooditis) and charges for production of public records (HB599).
In addition, two land use bills are no longer in play: SB255 (Bell) which dealt with wireless communications infrastructure and SB602 (DeSteph) that restricted localities abilities to deal with short-term rentals.
VML Contact: Michelle Gowdy, email@example.com
Bills that warrant local government support or opposition
Please call your legislators and let them know where you stand!
Bills to Support:
HB444 (Bennett-Parker) FOIA; meetings conducted by electronic communication means; situations other than declared states of emergency. Sets out the parameters for public bodies to hold electronic meetings outside of the state of emergency when following the rules as set out in the bill. VML, VACo, the Press Association and the Coalition for Open Government worked to make this a consensus bill.
HB1131 (Williams) / SB417 (Stanley) Virginia Code Commission; work group to review public notices required to be published by localities. This is a VML, VACo, Press Association bill to gather the various types of local government public notice provisions set out in the code. The group shall review: the varying frequency for publishing notices, the number of days required to elapse between publications and the amount of information required in various notices.
HB1173 (Ware) / SB631 (Barker) Fair Labor Standards Act; overtime; employer liability. Replace the current provisions of the Virginia Overtime Act with the provision that any employer that violates the overtime wage requirements of the Federal Fair Labor Standards Act and any related laws/regulation. The Barker version currently has a provision for derivative carriers and creates a work group.
HB216 (Simonds) / SB57 (Locke) State and Local Government Conflict of Interests Act; definition of gift; certain tickets and registration or admission fees. Exempt from the definition of gifts tickets and registration or admission fees that are provided to a locality’s owner officers or employees.
SB152 (Locke) Definitions. Defines “official government website” to be an internet site controlled by the public body and used to publish notices and other content required by the Freedom of Information Act (FOIA) on behalf of the public body.
HB167 (Ransone) Publication of notice by localities. This is a VML, VACo and Press Association bill that provides relief for a locality if the newspaper errs in publishing a public notice.
Bills to Oppose:
HB1362 (Wiley) Short-term rentals; localities ability to restrict. Requires localities to adopt an ordinance if they want to tailor the operation of short-term rentals. The text of the relevant change to Virginia Code 15.2-983 is as follows : “If the governing body of any locality has not by ordinance, pursuant to its general land use and zoning authority, restricted the operation of short-term rentals, an operator may operate a short-term rental in the locality, subject to applicable law.
HB1088 (Leftwich) Planning; definition of subdivision; boundary line agreement. Work continues on this bill, but as currently written it would alter the definition of subdivision in Virginia Code Section 15.2-2201 to allow bona fide property line disputes by agreement without local review with some guard rails. In addition, if the division of land is subject to a suit of partition it also will not require local review if the parcels are not varied from minimum lot area, width, and frontage requirements by more than 20%.
HB384 (Davis) State and local employees; freedoms of conscience and expression. Disallows local government from penalizing an employee for expressing his opinion during a local government public comment period at a local governing body meeting.
HB615 (Roem) Sale of cemeteries owned by a locality, notice to descendants. Requires a locality to retain ownership of a cemetery while the locality provides notice to the last owner of record and attempts to contact all known family members and descendants. The legislation does not provide a timeline of how long the locality has to wait before they can sell.
VML Contact: Michelle Gowdy, firstname.lastname@example.org
Bills of concern to local governments
HB307 (Freitas) Virginia Freedom of Information Act; estimated charges for records. Now states that before searching for records a public body must notify the requestor in writing that there could be a cost and offer at their request to create an estimate. Currently the requestor can request an estimate.
HB150 (March) Virginia Freedom of Information Act; local public bodies to post meeting minutes on its website. Requires localities to post minutes of its minutes on its website if they have a website within seven working days of finance approval of the minutes. If there is no website, copies must be available at a prominent location. The time limit is a concern to VML.
VML Contact: Michelle Gowdy, email@example.com
Legislative items of interest to watch
SB290 (Favola) Solar-ready roof requirements for state agencies and localities; energy-positive building design for schools. Requires localities to use solar-ready, cool, or energy efficient roofs on construction of a new building greater than 5,000 gross square feet in size, or the renovation of a building where the cost of renovation exceeds 50% of the value of the building. There are definitions and an option to opt out included in the proposed legislation.
HB616 (Roem) Zoning appeals, board of; funding. States that upon request of a board of zoning appeals, the governing body shall consider providing them with an adequate budget.
SB494 (McClellan) Nondiscrimination in employment; definitions; exceptions. Amends the Virginia Human Rights Act to change the definition of “employer” to be a person employing 5 or more employees instead of the current 15.
HB961 (Roem) Cemeteries; registration, publication prior to sale. This bill was amended by the Patron to a “may” instead of the original “shall.” In its current form it provides the ability for localities to create a local registry of cemeteries, graveyards and other burial grounds located on private property; the bill contains safeguards for disclosure of the locations. There is also a public notice provision prior to the public sale of publicly owned property that contains a cemetery, graveyard, etc.
SB286 (Ebbin) Preservation of historical sites and architectural areas. Localities may require a survey of property lines prior to a land purchase if they have established a local historic district.
HB267 (McNamara) Local taxes; surplus revenues. Current law allows a locality to return surplus real property taxes to taxpayers; this bill adds surplus personal property taxes to the mix.
HB272 (Marshall) / SB501 (Lewis) Local land use approvals; extension of approvals to address the COVID-19 pandemic. Extends from July 1, 2022, to July 1, 2023, the sunset date for various land use approvals that were valid and outstanding as of July 1, 2020.
Standing to appeal a historic district decision will remain unchanged
HB1210 (Hope) and SB206 (Petersen) were filed to expand the persons who have standing to challenge a decision by a locality’s historic district board. VML is happy to report that neither bill was adopted by the General Assembly, and therefore, the issue is resolved for this year.
VML Contact: Mark Flynn, firstname.lastname@example.org
Eminent domain bills continue to have issues for localities
This session, VML has been tracking two bills that would alter eminent domain law. These bills contain provisions that need to be improved to obtain a fair balance of the rights of the public, as taxpayers, and the owner of land being acquired for a public use.
In its present form, SB666 (Petersen) has three areas of concern for local governments:
- If a city or town takes some action that limits or cuts off access to business property for a short period of time without taking any land of the owner, the bill enables a business owner to sue for lost profits, which power does not exist today. Examples include a parade or street festival that closes the street temporarily, or a sidewalk improvement project or water main break fix that limits access for a short period of time. These lawsuits are unlikely, but the law should not encourage them.
- In the part of the bill dealing with the trial over how much the landowner is to be paid, the bill requires a court to separate the trial over lost profits or lost access from the main condemnation trial at the request of the landowner. This makes the condemnation proceeding more costly. Currently, the court may separate the trials: this should remain in the law.
- The bill removes safeguard language in the existing law that prohibits a court from awarding damages for lost profits and lost access twice to same landowner.
The main goal of SB666 is to ensure that a small business owner can be properly compensated for lost profits. We support that goal. However, the three issues described above should be improved.
SB694 (Obenshain), in its current form, has one provision that needs to be resolved. The bill requires the condemning locality to include an end-date for any temporary construction easement. That is impossible for a city or town with larger street projects or other large projects, such as extending a water main. The locality simply cannot know the end date at the time it files the condemnation certificate. Senator Obenshain has indicated interest in addressing this issue.
Status and what to expect
The Senate approved both bills. Their next stop will be the House Courts of Justice Committee, which will happen within the next two weeks. VML is working with the patrons to deal with the issues remaining in the legislation outlined above.
VML Contact: Mark Flynn, email@example.com
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ICMA Leadership Academy Contact: Grant More, firstname.lastname@example.org