Buying or selling a cannabis business in Billings, Montana

The Billings city line is the whole story

Billings is Montana’s largest city and Yellowstone County is the state’s biggest cannabis market, yet the two facts do not meet inside the municipal boundary. On 2 November 2021 city voters chose to permanently prohibit adult-use dispensaries within the city limits, and the City of Billings has applied that result ever since.

The money still gets spent. Yellowstone County recorded $4,558,783 of cannabis sales in June 2026, $4,102,610 of it adult-use, the highest total of any Montana county. Practically all of that adult-use volume is transacted outside the city line, in Lockwood, Laurel, and unincorporated Yellowstone County. A buyer evaluating a Billings-area store is buying a position on a boundary, not a position in a city.

What the city does license

Inside Billings the city licenses medical marijuana dispensaries, cultivators, transporters, manufacturers, and testing laboratories. The binding number is the retail cap: a maximum of eight medical dispensary licences within city limits. If more than eight eligible applications arrive, the city runs a lottery.

Two features matter to a deal:

1. The city licence is not transferable. Billings says so plainly, contrasting it with alcohol licences. A buyer must qualify for their own city licence. That sits on top of the state ownership-change approval described on the Montana state page.
2. Zoning is a separate permit. Applicants need a Zoning Compliance Permit and must check the city’s marijuana business zoning map. The application fee is $350, non-refundable, with further licence fees by type.

Eligibility was also tied to history: until 1 July 2023, only Montana medical licensees holding a state licence on 3 November 2020, or with a pending application, could qualify for city cultivation, manufacturing, or medical sales licences. The practical result is a small, closed group of incumbent operators.

Local taxes

Yellowstone County adopted a 3% local-option marijuana tax on both adult-use and medical sales, effective 31 January 2022. It stacks on the state’s 20% adult-use and 4% medical rates. The revenue split is fixed by statute: 50% to the county, 45% apportioned to municipalities by population, and 5% retained by the Montana Department of Revenue for administration.

Note the asymmetry created by the city ban. Billings receives a share of local-option revenue generated by stores it does not host. That has fed periodic political pressure to revisit the ban, and a Yellowstone County resolution to re-vote on recreational marijuana has already been floated and failed. Do not underwrite a change either way.

Zoning and siting around Billings

Inside the city, dispensaries are confined to specific zones and must clear the zoning compliance step. Historically the city’s approach to medical storefronts pushed them toward industrial and heavy commercial districts with a 1,000-foot separation from churches, schools, parks, and similar public places. Confirm the current buffer text in the Billings code before valuing any location, and read zoning, buffers, and conditional use permits.

Outside the city, county siting rules govern. Because adult-use retail cannot cross into Billings, the corridors carrying commuters and highway traffic toward the city are the premium locations, and they are effectively fixed in number by Montana’s statewide moratorium on new licences, which runs to 30 June 2027.

What this means for sellers

If you hold one of the city’s eight medical dispensary positions, you hold something that cannot be created and cannot be handed over. Your buyer must qualify for their own city licence and pass the state ownership review, so screen buyers for eligibility before you spend months on a deal. Have the zoning compliance permit, the city licence file, and the Metrc history ready, and read preparing a cannabis business for sale.

If you own an adult-use store in county territory serving Billings, your value driver is location and traffic, not brand. Document catchment: point-of-sale data showing customer origin and repeat rate will do more for your price than a P&L alone. See how real estate control affects value.

What this means for buyers

Ask three questions before anything else. Is the premises inside or outside the Billings city limits, and does the answer match the licence type being sold? Is the city licence, if any, one of the eight, and can you qualify for it in your own name? And what does the seller’s store actually capture from Billings commuters, measured rather than asserted?

Then run the state process: Montana licences are not transferable either, so the deal is a purchase of the licensed entity with prior Cannabis Control Division approval of the new owners. Verify revenue in Metrc, build the approval into a regulatory-approval contingency, and compare the position with Missoula, where the city has taken a very different approach. A free 20-minute intro call is a reasonable place to start.

This page is educational and is not legal or tax advice. Billings ordinances change; confirm the current code and licence availability with the city before you sign anything.