Cannabis forum draws crowd from both sides

CALEXICO — Both supporters and detractors of the city of Calexico’s permitted commercial cannabis activities turned out for the city’s community cannabis forum on Thursday at City Hall.

Jesus Zarate was among those who have concerns about the potential negative impacts that commercial cannabis activity may have on the city’s quality of life and public health and safety.

Although Zarate is not a resident of Calexico, the former correctional officer said his primary concerns regarding commercial cannabis activity is its potential harm to the public’s health, especially youth.

During the forum, Zarate had also asked presenters whether they were aware of any research that suggested the presence of legal commercial cannabis businesses had a negative effect on home values.

“The city of Calexico can ill afford to bring a business that is going to further deteriorate its economic development,” Zarate said after the forum.

In response to Zarate’s question about impacted home values, one of the presenters said she was not aware of any research having been conducted on the topic.

Presenters had also pointed out that the city’s ordinances regulating commercial cannabis businesses restricts their operations to a designated cannabis overlay zone that is predominantly industrial and commercial, and include prohibitions against locating a business less than 600 feet from a “sensitive receptor” such as a school or church.

The forum was meant to inform the community about the statewide commercial cannabis industry and accompanying laws, as well as the status of commercial cannabis activity in Calexico.

While the city’s current ordinances regulating commercial cannabis activity prohibit dispensaries and delivery operations, the city does allow the licensing of up to 10 applicants in each of the following categories: cultivation, manufacturing, distribution and the testing of cannabis products.

Currently, the city has a development agreement with one business allowing it to cultivate and manufacture cannabis products, Assistant City Manager Miguel Figueroa told those present.

The city can now also issue regulatory permits to approved applicants for authorized commercial cannabis activities, he said.

With the assistance of its city attorney, the city has also adopted a framework that aims to entice applicants whose proposed cannabis business models include true and expansive investment and economic benefits to the city.

Such a framework, which requires detailed information about applicants’ finances, security measures and business model also helps limit the number of “speculators” looking to apply, Figueroa said.

“That is something that has limited a high number of applicants from coming to town,” he said.

The potential for outside deep-pocketed entrepreneurs to capitalize on Calexico’s burgeoning commercial cannabis industry at the expense of local community members did not sit well with at least one attendee.

Yet, the fee structure and requirements currently in place for applicants seem overly restrictive for individuals with limited capital, especially if Measure K, a proposed cannabis tax ballot measure, is approved by voters in November, said the attendee, who asked not to be identified.

City ordinance 1177 requires commercial cannabis facilities to be at least 5,000 square feet. A cannabis tax measure currently on the ballot, if approved, would authorize the city to tax commercial cannabis businesses, such as cultivators and manufacturers, up to $25 per square foot on a quarterly basis.

That creates the potential for a prospective cannabis business to have to pay $100,000 in taxes on a quarterly basis, the attendee said following the forum.

“I think it’s going to be hard for any local resident or business owner to just come up with at least $100,000,” he said. “What I’m afraid of is the big companies coming in.”

The proposed Measure K tax of up to $25 per square foot is the maximum the city would be authorized to charge cannabis businesses. However, the City Council is also authorized to consider and approve adjustments to the tax rate, officials said.

Those interested in applying for a commercial cannabis business are encouraged to contact City Hall to find out more about the application process and fees, Figueroa said.

“We make sure to walk anyone who is interested through the process,” he said.