Cannabis ordinance conversation goes from anger to compromise

SOUTH LAKE TAHOE, Calif. - After a referendum to put a halt to the South Lake Tahoe cannabis ordinance was successful, a meeting held Monday was to work through the points of the ordinance Cody Bass and Tahoe Wellness Cooperative took issue with.

Led by the City Council representatives Austin Sass and Brooke Laine, members of the original cannabis workgroup, Cody Bass and some members of the public, about two dozen in total, spent three hours trying to come up direction for the city attorney to use in creating a new ordinance.

Laine and Sass were seeking comments from the public and stakeholders to see what opportunities to create an ordinance that was different from the original one stopped by Bass and his legal team, but what those opportunities look like were unclear for most of the meeting. Compromise was the goal of the day.

"We are interested in what you think are issues, what do you want subcommittee to consider?" said Laine to Bass.

Ideas were shared and all points of the ordinance were examined in order to create an ordinance that wouldn't be stopped by another referendum or lawsuit.

"Nobody is trying to do anything personal against you," Sass said to Bass a couple of times. "We gave you concession of the medical use being grandfathered in."

What Bass wants is to be grandfathered in for adult use marijuana sales, cultivation, on-site consumption and distribution, all business types he wants to continue at his Bijou Center location, all license types that don't happen to be allowed at his current location by the stopped ordinance.

Tahoe Wellness Cooperative (TWC) is grandfathered in as a medical marijuana business in its current form, but Bass said his sales are down 60-70 percent with adult-use sales at the other end of the lake. He said adult-use sales, cultivation and distribution will kill his business once licenses to conduct cannabis businesses in South Lake Tahoe area issued.

South Tahoe Now has a copy of the talking points used by referendum signature gatherers at local grocery stores. Many have been proved to have mislead the public who was signing the document. These were discussed at Monday's meeting:

1. On August 21 the South Lake Tahoe City Council passed a bad cannabis ordinance. Sign here to stop it from becoming law.
2. The Ordinance harms local access to medical cannabis.
3. It essentially put the town's home-grown dispensary, Tahoe Wellness Cooperative, out of business by denying it the right to transition into adult use/recreational market to survive.
4. The ordinance pretends to bring adult use to Tahoe, but it will really make it impossible to create new cannabis businesses without big outside corporate money.
5. It would limit retail, cultivation, and manufacturing businesses to two permits in each category. And it would require expensive Development Agreements with the City, driving up costs and prices.
6. The City has never alleged any problems with Tahoe Wellness, but they have been trying to shut it down for no reason for almost two years.

Where the cannabis market will go in South Lake Tahoe is yet to be seen, but many are investing time and money in hopes it will be a lucrative venture. Some of those hoping to be issued licenses to operate in town were also at the forum, and heated discussions took place between Bass, those businessmen, workgroup members and the two Councilmembers.

On the table were the license types outlined in the halted ordinance: Two retail sales, two cultivation and two microbusiness licenses.

Bass has been in litigation with the City for over two years, ever since he couldn't obtain a signature from his landlord on the City's permit application. He also went to court with his landlord over the situation. He has since purchased the building but the lawsuit with the City is still tied up in court.

The first two hours of the Monday meeting were open and healthy conversation, and it then became an attack on the fact sheet (see above). The workgroup wanted to make sure the truth was out and it turned into an "us versus them" discussion with passions running high. For a period, nobody could get a word in without Bass interrupting.

"This conversation is very unnerving," Laine said to Bass.

But there was consensus on some points that will show up in the draft ordinance. The group liked the change of allowing licenses to be transfered to heirs or to possible future business buyers. They all also agreed that distribution is the key element of a microbusiness and suggested allowing a microbusiness to hold a retail license as well, satisfying the distribution needs. There will most likely not be a need for fulltime testing of the product in South Lake Tahoe. Bass has a mobile test van come to town when needed for his medical marijuana business.

"Let's make lemonade out of these lemons," said Craig Ziegler, founder of Canniblue and hopeful licensee.

It appeared that there would be no hope to come to an agreeable conclusion of the forum until Boys & Girls Club Executive Director Jude Wood stepped in to bring the sides together.

Wood suggested to allow TWC to operate in the same way as he does for medical use but allow him to move into adult use for three years. During that time period he can exist as a non-conforming business, get zoning issues at his current property corrected and reconfigure his layout to utilize the bank vault obtained in the purchase of the building that held a branch of El Dorado Savings. He could not get building permits to grow the business until he became a conforming use. Wood said this allows the community to move forward and development agreements and licenses issued to others.

"This is a fair resolution," said Tyler Champlin who is interested in getting one of the City's first cannabis licenses.

"I like where we're going," said Liz Hallen, a member of the original workgroup. She said she didn't want Cody to be limited in what he could do at his current site.

Bass's three-year time period would give him a license above the other six that will be issued.

If this is the direction the Council decides to go, Bass would be held to the same licensing standards as all the other licensees.

"I have no issues with that," Bass said.

Any changes to the existing ordinance will have to be voted on by the City Council during a first and second reading after being approved by the planning commission. City Council is expected to have this on their October 16 agenda, then a draft ordinance could go to the Planning Commission on November 8. There must be ten days between that meeting and the Council meeting to approve it, so it wouldn't be ready by their November 13 meeting. A special council meeting cannot be called for a first or second reading. Due to Thanksgiving, the following Council meeting is on December 11 when a first reading could happen, with a second reading during their January 8, 2019 meeting. If approved, a new ordinance could be in place on February 8, 2019. This would be a fast-track scenario.

A moratorium is in place until December when the Council could vote to extend it until their new ordinance is approved, thus preventing the State from stepping in to issue their own licenses.