Turlock’s third of four dispensaries to participate in the City’s cannabis pilot program received approval from the City Council Tuesday night, but not without some pushback from a former Councilman appealing its location. 

Natural Healing Center will move forward with plans to open a retail dispensary at 3401 W. Monte Vista Ave. following Council approval of a development agreement with the business, as well as Council denial of an appeal of its conditional use permit filed by former Turlock City Councilman Matthew Jacob. 

NHC’s conditional use permit was first approved by the Planning Commission on Aug. 6, and Jacob filed an appeal of the decision on Aug. 17. In a letter to the Planning Commission dated Aug. 6, Jacob stated that he and his family own the property adjacent to the then-proposed dispensary and that he had concerns about the long-term effects a cannabis business would have on the commercial and shopping district, such as reduced real estate values. 

Jacob also noted the location’s proximity to Highway 99 and speculated that the all-cash business could be a beacon for potential robberies. Although he asked the Planning Commission to consider denying the conditional use permit and direct the business to find a different location, the item was ultimately approved. 

Jacob’s appeal that came before the City Council on Tuesday stated that he felt “dissent with Planning staff’s assessment that the proposed project does ‘not adversely affect abutting properties,’” and asked that the decision be reversed to find a more suitable location for the project. 

In correspondence sent to the City Clerk by Jacob’s lawyer, Blaine Cox, it is stated that the project is inconsistent with the City’s General Plan, conflicts with adjacent and surrounding land uses and also violates the California Environmental Quality Act. The document argues that the General Plan requires businesses located in a Commercial Thoroughfare District, as NHC will be, must provide for uses designed to serve motorists traveling along Highway 99.

“Commercial cannabis dispensaries cannot and should not be designated to serve motorists traveling along a state highway as its zoning requires,” Cox told the Council via phone call. “The appellants are deeply concerned that given the surrounding land uses, patrons of the proposed dispensary would likely or undoubtedly consume product purchased from the dispensary in surrounding parking lots or agricultural areas and then patron the eateries and facilities in close proximity to the project.”

While City staff designated the project as categorically exempt from CEQA, Cox stated that the claimed exemptions are erroneous since staff identified the possibility of environmental effects relating to odor, disposal of waste, crime and urban decay. Exemptions stated by the City include a “common sense exemption,” which Cox argued must rely on evidence and certainty of no environmental impact, and a “existing use exemption,” which applies if the project would have negligible or no expansion of the building’s existing or former use. While the location currently houses a commercial establishment, El Rosal, and would house another commercial establishment upon NHC’s opening, Cox stated that the switch from restaurant to retail cannabis makes the exemption invalid. 

Cox also argued that City staff “piecemealed” CEQA review of the project by separating the review of the conditional use permit and development agreement, and that an environmental impact report is required when there is a “fair argument” that the proposed project may have a significant adverse effect on the environment.

In his comments during the meeting, Jacob equated the approval of a five-year development agreement with NHC by the City Council just over a month before the election to the U.S. Senate’s forthcoming vote on a new Supreme Court Justice following the death of Ruth Bader Ginsburg. 

“Approving this tonight just 41 days to the upcoming election means that the action you could take could outlast the coming four-year terms of for sure one, if not two, new members of a five-person legislative body,” Jacob said. 

NHC Director of Government and Public Affairs Joe Armandariz argued that as part of a pilot program with annual reviews, whoever is on the next City Council will have their chance to weigh in on agreements made prior to their arrival. 

“I think these ways of doing things make a lot of sense,” he said. “It allows you maximum flexibility to be able to adjust and modify and change course as it needs to be done.”

Former Councilmembers Bill DeHart and Mary Jackson also called in to Tuesday’s meeting to voice their opposition to the dispensary. Despite this and Jacob’s pleas, the Council voted 4-1, with Bublak opposing, to deny the appeal. The Council also voted 4-1, with Bublak opposing, to approve the development agreement with NHC, which will see the dispensary pay the City of Turlock $25,000 or 5.25 percent of gross receipts as a public benefit fee each month. The minimum monthly amount of $25,000 will increase by $5,000 annually.

Citing potential litigation as a result of the appeal, City Attorney Doug White wasn’t able to say much on the matter during the meeting. He did, however, express complete confidence in the City’s process when bringing cannabis dispensaries into town. He also argued that anyone who did not like the process should have spoken up when the pilot program was approved 18 months ago.

White also noted that any litigation costs would not fall upon the City should a lawsuit be filed.

“I personally have used this (process) in a number of different cities and have done it for now going on six years...I had the opportunity to go back throughout our processes and reconfirm we feel extra competent in its legal standing and the way we process it,” White said. “We wouldn’t have done it this way if we didn’t think it would stand up to legal review. We feel very confident from a legal perspective that if this were to be challenged, that the City would prevail.”

Councilman Andrew Nosrati echoed White’s confidence in the process.

“I’m not a CEQA expert; I defer to my staff in making those recommendations and read the staff reports,” he said. “All we have is the staff report in front of us and the recommendation based on the expertise of our staff, and some of the issues raised here feel like a stretch.”

Also on Tuesday, the City Council approved the final reading of an amendment to the City’s zoning code to allow for an industrial hemp program in a 4-1 vote, with Nosrati opposing. 

The ordinance amendment will be part of a broader hemp manufacturing regulatory program which utilizes a tiered approach for different hemp manufacturing operations. All businesses that intend on producing, blending or manufacturing any type of hemp product must obtain a “Type A Industrial Hemp Business” license from the City. This type of license will also apply to hemp manufacturers seeking to mix CBD with oils, lotions, creams and more, but does not permit them to extract CBD on site. 

The Ordinance prohibits industrial hemp cultivation in all zones within the City. Type A industrial hemp businesses will be limited to the heavy commercial/light industrial district, Business Park District and general industrial district. Type B businesses, which will extract CBD on site and use it in products, will be allowed to operate in the heavy commercial/light industrial and general industrial district.