The marijuana cultivation landscape continues to evolve in the arid western United States. States that have opened their previously medical-only markets to recreational customers (Colorado, Washington, Oregon, and Alaska) have adopted a variety of different rules and regulations. Other states, such as California, Nevada, and Arizona, will be asking voters to decide on recreational legalization this fall.
While states have a patchwork of regulatory and licensing systems, varying from medical only to medical and retail marijuana markets, cultivation regulations also vary from state to state. Availability of water is also a complicating factor for businesses seeking to enter the nascent cannabis economy—with additional complexity coming from Washington, D.C.
The federal government is the West’s largest water provider and the US Bureau of Reclamation issued Temporary Policy 63 in 2014 to prohibit water from federal facilities to be used for cannabis cultivation. In some jurisdictions where cannabis cultivation has been permitted, water may not be available. Some jurisdictions have interpreted this ban to include federal water used to replace diverted water used by cultivations, if required by federal compact.
Federal water policy has emerged as a new risk in these jurisdictions. Some local water utilities and irrigation districts throughout the west, from Oregon to Colorado, have had their ability to provide water limited.
Urban growers may find challenges arising from water utility companies, while suburban and rural growers may face challenges finding suitable groundwater, surface water rights, or hauling water. In light of legalization, some states have created resources to aid growers:
Colorado’s Division of Water Resources published “Well and Water Use in Regards to Amendment 64 and Cultivation of Marijuana” in 2014. Some of Colorado’s irrigation wells and water rights are not suitable for off-season irrigation or for use in indoor or greenhouse facilities. The document also aids applicants who wish to apply for a well permit for a cultivation site.
Note: While Colorado’s state marijuana license applications do not require information on water supply or sources, local licenses and zoning approvals may require this information from new applicants.
Oregon’s Water Resources Department published “Understanding Water Use Regulations: Medical and Recreational Marijuana” as a resource for new and prospective growers. While many policies have similarities to Colorado, it is important to note the 5,000-gallon per day exemption for marijuana processing activity. This does not apply to cultivation.
Note: The Oregon Liquor Control Commission requires water source documentation as part of some new license applications.
Additionally, California is preparing to enter a new era of medical marijuana regulation with the passage of the 3-part Medical Marijuana Regulation Safety Act (including Assembly Bill 243, Assembly Bill 266 and Senate Bill 643). When combined, these laws are the largest overhaul in California’s 20-year medical marijuana history. AB 243 focuses on combating environmental degradation commonly found at many of the state’s estimated 50,000 grow sites. California voters will decide on further legalization this fall with the Adult Use of Marijuana Act on the November ballot.
In the wake of last month’s DEA ruling that marijuana will remain a Schedule I substance, it is unlikely that policy changes for cannabis or cannabis irrigation will change before Temporary Policy 63’s slated expiry in Spring 2017—after a new administration is in the White House. The status quo will continue to hamper the rapid growth of a new sector in many western communities, frustrating both cannabis cultivators and water suppliers.
Considerations for Prospective Cultivators
- Check the status of surface and/or groundwater rights on the property you are looking to purchase and cultivate on. This can typically be done through the state engineer or water resources department.
- If applicable, check with the water utility that serves the area you are looking to do business in. Depending on their water source, they may not be able to supply water to cultivation.
- Purchasing hauled water from a dispensing station may be an option in some states, but documentation of a purchasing agreement may be required prior to approval of a cultivation license.