10C Action 2016 1017 - Laserfiche WebLink

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File Number: 16-530 On September 18, 2016, the City Council adopted the amendments to the medical cannabis dispensary ordinance to allow for the issuance of a third dispensary permit and to eliminate the requirement that dispensaries be located at least 1,000 feet from one another. A second reading of those ordinance amendments was then conducted on October 3, 2016 meeting. Presuming a referendum on these changes is not filed, the amended ordinance will become effective on November 2, 2016. Overview of Blum SL’s proposal As outlined in the July 18, 2016 staff report and in the attached application materials, Blum SL submitted a detailed proposal that effectively responded to the City’s questions. Blum SL’s responses demonstrated that it had the capability and capacity to operate a successful dispensary in San Leandro. As part of that proposal, the applicants proposed to purchase real property at 1925-1927 Fairway Drive. The site complies with the distance requirements outlined in the dispensary ordinance and is located in an industrial zone that is appropriate for the proposed use. In addition, Blum SL’s proposed site would provide in excess of 30 parking spaces, which exceeds the minimum parking standards required by the San Leandro Zoning Code. Blum SL’s proposed dispensary operations would utilize approximately 5,000 square feet of the 13,300 square foot building. Blum SL is also interested in either relocating its laboratory and manufacturing operations to San Leandro, or expanding into manufacturing edibles in the remaining 8,300 square feet. Finances Based on current registered Blum Oakland patients who live in San Leandro or nearby communities, Blum SL expects to begin serving approximately 60 patient visits per day in the first quarter of operations, gradually increasing over the next three years to approximately 300 patient visits per day. According to its pro forma, Blum SL will generate approximately $2.6 million in revenue in its first full year of operation; approximately $5.4 million in Year 2, and approximately $7.3 million in Year 3. However, it should be noted that these projections were based upon the anticipated existence of only two dispensaries in San Leandro. Given that the Council is now considering awarding three permits, it is conceivable that these projections could be impacted by the existence of three dispensaries instead of two. Operations Blum SL proposes a tested, traditional model of dispensing medical cannabis that is informed by its four years of experience operating a dispensary in Oakland, and more recently in Las Vegas. Blum SL’s application includes photos of the Las Vegas location, which will be the model for the San Leandro dispensary. Blum SL will be structured as a new community collective, although managed by many of the same executive team members who manage Blum Oakland. As a result of Blum Oakland’s merger with a publicly traded company -- Terra Tech Corporation - Blum SL states that it will have greater access to “working capital, state of the art equipment, grow technology, human resources services, community partners, and industry expertise.” Blum SL states that the merger increased levels of transparency through more stringent financial and performance auditing requirements, which resulted in stricter operating standards. Blum SL proposes that it will employ 21 employees in year 3 and operate up to 10 patient stations to handle 300 patients per day. All employees at Blum SL would be offered access to a medical plan, dental, vision, employee assistance, 401(k) retirement match, and various other employee benefits upon hiring. Blum SL also plans to handle vendor purchases at its Page 3 City of San Leandro Printed on 10/11/2016