Buenos Hill Inc. v. Saratoga Springs Plan. Bd.

206 N.Y.S.3d 902

In the Matter of the Application of BUENOS HILL INC., a New York corporation, Petitioner/Plaintiff,

v.The SARATOGA SPRINGS PLANNING BOARD, The City of Saratoga Springs, Dillon Moran, in his official capacity as the City of Saratoga Springs Commissioner of Accounts and City Clerk, City Assessor, Insurance Officer, Purchasing Agent, and Records Management Officer, Ten Cees, LLC, Piseco Realty, Ltd., New York State, the New York State Cannabis Control Board, The New York Office of Cannabis Management, Tremaine Wright, in her official capacity as the Chairwoman of the New York State Cannabis Control Board, and Chris Alexander, in his official capacity as Executive Director of the New York State Office of Cannabis Management, Respondents/Defendants.

Supreme Court, New York, Saratoga County.

Decided on March 4, 2024

William R. DiCenzo, Esq., The Law Office of William R. DiCenzo, 34-62 Junction Boulevard, Jackson Heights, New York 11372, Attorney for Buenos Hill, Inc.

Alexander Powhida, Esq., NYS Office of the Attorney General - Litigation Bureau, The Capitol Albany, New York 12224, Attorneys for New York State, the New York State, Cannabis Control Board, the New York Office of Cannabis Management, Tremaine Wright, and Chris Alexander (collectively, the Moving Defendants)

Richard A. Kupferman, J.

Is marijuana legal in New York?

In March 2021, New York passed the Marihuana Regulation and Taxation Act ("MRTA") (see L 2021, Ch 92). The MRTA, which created the Cannabis Law, is intended to tax, control, and regulate recreational marijuana (see Cannabis Law § 2). This represents a significant change from prior policy that focused primarily on criminalization to control marijuana use (see Cannabis Law § 2). The Legislature found that the prior laws were "ineffective in reducing or curbing" marijuana use and "instead resulted in devastating collateral consequences" including mass incarceration, disproportionate impacts on minority communities, and unwarranted restrictions on a person’s ability to access housing, employment opportunities, and other vital services (id.). The prior laws also created an illicit market and threatened public health (id.).

The new policy now allows for adults 21 years of age or older to use and possess marijuana in moderate amounts (see Cannabis Law §§ 3[6], 13[3][a], & Article 4; Penal Law § 222.05). Businesses may also apply for a license to sell recreational marijuana (see Penal Law § 222.20; Cannabis Law §§ 72; 77). It is still illegal under New York law, however, to possess large amounts of marijuana, sell without a license, or operate a motor vehicle under the influence (see Cannabis Law §§ 2; 125; Penal Law § 222.00 et seq.; Vehicle and Traffic Law §§ 1192; 1227). In addition, the new laws are not intended to "require any individual to engage in any conduct that violates federal law or to exempt anyone from any requirement of federal law or pose any obstacle to the federal enforcement of federal law" (Cannabis Law § 2).

Cities, towns, and villages were provided with the option (if exercised by a specific deadline) to opt-out of that portion of the law allowing dispensaries and on-site consumption businesses to be located within their jurisdictions (see Cannabis Law § 131 [1]). For those municipalities that opted-out, the law allows them the opportunity to rescind their opt-out election at any time and to allow such businesses to operate within their jurisdiction (see id.).

Municipalities that did not opt-out are now no longer permitted to opt-out (id. at § 131[1]&[2]). They are now "preempted from adopting any law, rule, ordinance, regulation or prohibition pertaining to the operation or licensure" of such businesses (id. at § 131[2]). Cities, towns, and villages, however, may still "pass local laws and regulations governing the time, place and manner of the operation" of these businesses, provided that "such law or regulation does not make the operation of such [businesses] unreasonably impracticable" (id.).

The plaintiff ("Buenos Hill") is the owner of real property located within the City of Saratoga Springs ("City"), a city which did not exercise the right to opt-out of the licensing Scheme created by the MRTA. Buenos Hill alleges that it has been harmed by the local planning board’s issuance of a special use permit for the operation of a marijuana dispensary at a neighboring property. Buenos Hill contends that the dispensary will plague its neighborhood with an increase in drug abuse, crime, homelessness, and hospitalizations. Buenos Hill also contends that the dispensary will cause a reduction in its property value and a decrease in its business.

In addition to challenging the special use permit and the zoning law, Buenos Hill asserts two declaratory judgment claims against the Moving Defendants (including the State of New York), challenging the legality of the Cannabis Law (see CPLR 3001). Specifically, Buenos Hill asserts that the opt-out provision in the Cannabis Law violates the municipal home rule provisions of Article IX of the New York Constitution, and that the Cannabis Law is preempted by the Controlled Substances Act ("CSA") by way of the Supremacy Clause of the U.S. Constitution.

Prior to answering, the Moving Defendants sought to dismiss the claims against them pursuant to CPLR 3211(a)(7) for failure to state a cause of action. The parties briefed the legal issues and conducted oral argument (see NYSCEF Document. No. 74). The Court further rendered a bench decision granting the motion dismissing the claims against the Moving Defendants.¹ The Court has since performed additional research into the legal issues presented and, upon reconsidering the parties’ contentions, stands by its prior determination dismissing the claims against the Moving Defendants for the reasons that follow.

The Fourth Cause of Action: The Opt Out Provision

[1] Buenos Hill contends that the time limitation in the opt-out provision in the Cannabis Law violates the New York State Constitution. The Court, however, questions whether the issue is ripe for adjudication and whether a decision on this issue would be merely an advisory opinion. CPLR 3001 authorizes a court, to render a declaratory judgment only as to "the rights and other legal relations of the parties to a justiciable controversy." "To constitute a ‘justiciable controversy/ there must be a real dispute between adverse parties, involving substantial legal interests for which a declaration of rights will have some' practical effect" (Chanos v. MADAC, LLC, 74 A.D.3d 1007, 1008, 903 N.Y.S.2d 506 [2d Dept. 2010]; see Park Avenue Clinical Hospital v. Kramer, 26 A.D.2d 613, 613-614, 271 N.Y.S.2d 747 [4th Dept. 1966], affd without opn 19 N.Y.2d 958, 281 N.Y.S.2d 359, 228 N.E.2d 411 [1967]).

[2] Here, the City presently does not desire to opt-out or prohibit the dispensary. Rather, the City desires to have the dispensary operate within its jurisdiction. As such, even if the Court were to invalidate the restriction placed on the City’s ability to opt-out, it would not change anything for Buenos Hill. Moreover, to the extent that Buenos Hill contends that the City may later change its position, this alleges nothing more than a hypothetical adjudication "where the existence of a ‘controversy’ is dependent upon the happening of future events" (Park Avenue Clinical Hospital, 26 A.D.2d at 613, 271 N.Y.S.2d 747 [internal quotation marks and citation omitted]). There is therefore no need to address this issue, as it may never mature into a justiciable controversy. Indeed, even assuming the City desired to opt-out in the future, the City could still resolve the matter with the State without the need for litigation or, alternatively, the Legislature could simply change the law.²

[3] Notwithstanding, even assuming the case was ripe for adjudication, the Court would still dismiss this claim based on the strong presumption of constitutionality generally enjoyed by statutes and Buenos Hill’s failure to satisfy the heavy burden of demonstrating that the statute is invalid (see Hotel Dorset Co. v. Trust for Cultural Resources of City of NY, 46 N.Y.2d 358, 370, 413 N.Y.S.2d 357, 385 N.E.2d 1284 [1978]; Farrington v. Pinckney, 1 N.Y.2d 74, 78,150 N.Y.S.2d 585,133 N.E.2d 817 [1956]; see also New York State United/ Teachers v. State of New York, 140 A.D.3d 90, 95, 31 N.Y.S.3d 618 [3d Dept. 2016]).

In support of its position, Buenos Hill contends that Article IX of the New York Constitution vests local municipalities with the unrestricted authority to determine whether to authorize marijuana dispensaries within their jurisdictions and that the State law cannot preempt local law on this issue. Buenos Hill also contends that the State cannot commandeer or compel its municipalities to give up their right to prohibit marijuana. These contentions are not supported by any applicable legal authority, and in fact they are contradicted by the plain language of Article IX of the New York Constitution.

Contrary to Buenos Hill’s position, Article IX does not exclusively reserve for municipalities the sovereign power to exclusively control local activities within their jurisdictions. To the contrary, Article IX provides the State with the power to pass general laws to control and regulate matters of local concern (see NY Const. Article IX, § 2 [b][2]). Although Article IX, § 2(c) provides local governments with the power to adopt local laws relating to their property and affairs, this provision contains an important qualification: A local law may not be inconsistent with a general law passed by the State (see NY Const. Article IX, § 2 [c]). As such, the State possesses the power to pass a general law to preclude municipalities from interfering with the State’s policy.

[4] Further, the Court disagrees that the Cannabis Law is a special law that required a home rule message under Article IX, § 2(b)(2). The difference between a special law and a general law concerns...