Licence fees to set up marijuana business in Billings could get pricey

Recreational marijuana and the businesses associated with it go live statewide on Jan. 1. Billings voters last month rejected allowing recreational marijuana storefronts to operate within city limits, but medical marijuana dispensaries and businesses that focus on cultivation, manufacturing, testing, storing and transporting adult-use cannabis will be legal.

Council members now are working to figure our how much the city should charge these groups to obtain a business license. City staff proposed as much as $4,750 for a specific license.

“This is about trying to recoup our costs,” said city administrator Chris Kukulski. 

Initially, staff proposed charging a different fee for each of the types of businesses based on how much each would cost the city to monitor and inspect. Andy Zoeller, the city’s finance director, estimated that it would cost the city $68,190 a year to regulate the various marijuana businesses. 

Of that $68,190, Zoeller calculated that $52,887 would be spent on code enforcement. From there, he split the costs across six business categories and factored them into the fee for the business license. Manufacturing was at the high end at $4,750. At the low end was transportation at $55. 

A standard Billings business license is $55. 

But rather than have a different fee for each type of business, council members ended up asking staff to come up with a flat fee model where each business type is charged the same fee. Averaged out, it would be roughly $3,700 per license. 

Council will vote on a final business license fee proposal at its Dec. 20 meeting. 

Medical marijuana dispensaries and the non-storefront elements of the recreational marijuana business will be limited to those areas in the city that are zoned industrial and heavy commercial, and sit at least 1,000 feet from neighborhoods, schools, churches, parks, addiction recovery centers and youth centers.