Published in Economic Development

Status quo: GR debates increasing sites for marijuana businesses; equity, local ownership concerns remain

BY Sunday, March 15, 2020 07:10pm

GRAND RAPIDS — Following mixed messages from the Grand Rapids City Commission late last month, marijuana advocates hope city officials will ultimately open more properties for medical and recreational facilities.

On Feb. 25, the commission went back and forth on applications for both types of facilities. The city has approved 24 licenses for medical marijuana businesses, while another 14 are waiting for approval. The city hasn’t finalized recreational marijuana zoning regulations and won’t start accepting applications until April 20.

Joe Neller, co-founder and chief government affairs officer at Green Peak Innovations LLC COURTESY PHOTO

Hours after voting to delay recreational and pause medical applications, the City Commission reversed course after the six commissioners could not agree on how to move forward. A last-minute dispute among commissioners also involved equity and local ownership.

Commissioners were considering zoning amendments recommended by the Planning Commission that would have eliminated a waiver process for sensitive land uses like religious institutions and opened more properties for cannabis development.

Marijuana advocates have sought to relax distance requirements in order to expand the number of properties qualified for marijuana business use, which they say could also help address concerns over a lack of local ownership. 

Joe Neller, co-founder and chief government affairs officer at Dimondale-based Green Peak Innovations LLC, said the Planning Commission rejected a provisioning center proposed by his company because of the site’s proximity to a church, even though the company had a waiver from the church.

“In a place like Grand Rapids, there are a lot of churches. (The Planning Commission’s recommendation) does open up more eligible properties, but I think it’s going to come down to individual property considerations in most cases, and whether the surrounding neighbors have an issue with it, whether it’s a church or anything else,” he said.

Green Peak is still actively looking for a location in Grand Rapids. 

Meanwhile, the industry will face the “status quo” related to zoning rules and applications, said Kristin Turkelson, acting planning director for the city. The city continues to process and accept medical marijuana applications under the current ordinance. 

However, the City Commission did not set a public hearing date on the proposed zoning amendments that will affect both medical and recreational marijuana businesses. As of now, the city does not have a recreational marijuana ordinance, but it does have a licensing ordinance that is set to begin accepting applications for recreational businesses on April 20. 

“We’re in the process of identifying what needs to happen between now and (April 20) in light of that deadline, but without an ordinance in place,” Turkelson said.

Opening up the process

The Planning Commission’s recommendations are aimed at increasing available parcels for marijuana facilities. 

Part of the City Commission’s concerns stemmed from the ordinance no longer giving waivers for sensitive land uses, including churches and substance use disorder facilities. State laws only say marijuana facilities cannot be located in areas zoned exclusively for residential use or within 1,000 feet of a K-12 school.

“The main points of concern (for the City Commission) were around which sensitive uses would be sensitive uses, and which would not be anymore,” Turkelson said. 

She added that the Planning Commission had a “very thoughtful discussion” earlier this year over sensitive land uses. Planning Commission members said these types of properties should be part of the special land use process instead of considered separately with waivers.

Green Peak was under a purchase agreement for its proposed medical marijuana business location when the Planning Commission denied its waiver because of the nearby church. 

“I wish they had (gotten rid of waivers) sooner so our property would have been made eligible,” Neller said. “I think every municipality has to take it on a case-by-case basis. The church we were located next to didn’t have an issue with it — I’m sure that’s not the case with every location in the city.”

The West Michigan Cannabis Guild has also pushed for more opportunities for local ownership of marijuana facilities. Increasing the number of eligible properties is a key way to do that, supporters say.

When the City Commission first voted to pass a moratorium on Feb. 25, a group of locals were working their way through the medical marijuana process. 

“None of the people who are in the process who got their medical license should be penalized,” said Chris Silva, a board member of the Guild. “Those folks should be allowed to qualify for (recreational) if applicable.”

Recreational sales are an important aspect for the long-term success of marijuana businesses, Silva said. The city needs to open up land use in a “meaningful way” because of the competition for real estate seen during the medical marijuana application process, he added. 

“If you don’t open up land use in a meaningful way, you’re never going to have locals,” Silva said. “The ability to lock up real estate through some sort of local connection can only push so far if the other guy is a millionaire.”

The Guild has pushed for eliminating the church buffer requirement, as well as the buffer requirement for parks and neighborhood frontage.

Other communities

Amid Grand Rapids’ uncertainty, recreational marijuana businesses have opened elsewhere in West Michigan. 

In Muskegon, Park Place Provisionary launched recreational marijuana sales in January. Muskegon has a marijuana overlay district where the businesses operate.

Muskegon Township approved recreational businesses in October, and the first dispensary is expected to open next month in the northwest corner of the township. Trustees there limited the number of licenses available and mandated that dispensaries operate in specific areas. Muskegon Township allows for seven dispensary licenses, and an unlimited number of licenses for growers, processors, safety compliance facilities and secured transporters.

Silva, who also does marijuana consulting, has served clients in Lansing, which does not have any waivers in its process. For both medical and recreational marijuana businesses, the city has a 500-foot buffer for parks and religious institutions. 

“They have very competitive licensing, but they also have way more locals involved,” Silva said. “They have a pretty decent adult-use system. They’ve limited them per ward, which actually isn’t the best but it’s better than nothing.”

In Battle Creek, the city allows for recreational growing, processing, transporters, retailers, safety compliance facilities and microbusinesses. There is no cap on the number of facilities allowed, but there are some zoning and setback restrictions, including that retailers and microbusinesses are permitted in commercial districts, but must be at least 1,000 feet from other marijuana dispensing facilities. Growers and processors are permitted in industrial zones, and need to be 1,000 feet from churches, daycare centers, schools, parks and residential areas.

Overall, the Guild would like to see opportunities created for everyone, but the “harsh reality” is that it’s “a very capital intensive, insanely expensive” industry, Silva said.

Like other companies, Green Peak is hoping Grand Rapids opens up more properties for both medical and recreational marijuana operations. 

“We are going to look at the changes they continue to make to see if the property we had can become eligible again,” Neller said. “We hope to be operational in Grand Rapids at some point in the future.”

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