Larkspur will not be collecting taxes from cannabis dispensaries any time soon.
The City Council voted 4-1 Wednesday to set aside discussion of allowing marijuana dispensaries to operate within the city after 50 people against the idea weighed in during an online workshop.
“I think we’re done with this,” Councilman Dan Hillmer said. “I don’t think we need to revisit it. I don’t want to spend staff resources on it. And I’d like to move on to do better things.”
Quashing the idea will not affect the status quo established in 2017, which allows for personal grows indoors and delivery by companies based outside city limits, said Dan Schwarz, city manager.
Last year the council banned cannabis operations within the city, but if it chose to move forward it could have directed staff to create an ad hoc committee to explore the idea, or leave it up to the voters by putting it on the November ballot, said Schwarz.
Dozens of parents, physicians, coaches, youth group representatives and former council members expressed concern that dispensaries in the city would lead to youth addiction and the normalization of cannabis.
Tori Kropp’s 19-year-old son Alexander died from a fentanyl overdose earlier this year. She said her son started experimenting with cannabis, which led him to use other drugs.
“There is an incredible drug problem in this county, and I’m listening to all of you not hearing it,” Kropp said. “Are we not responsible to take care of our children? If any of you think that weed, for a 14-year-old, is not a gateway drug — then you are not paying attention.”
Joe Jennings was one of a handful of residents who supported the idea of allowing dispensaries to help bring in needed tax revenue.
“My concern is that the city take seriously the multi-year impact of our economic recession and COVID-19 pandemic,” Jennings wrote. “The city needs to do a thoughtful review of all potential new revenue sources and take the time to evaluate the trade-offs with appropriate public input and discussion.”
Some speakers raised the issue of Councilman Scot Candell’s financial ties to the cannabis industry, saying he should recuse himself due to a conflict of interest.
Candell owns a law firm that specializes in cannabis issues and is the CEO of a lab that tests cannabis products in Novato.
City Attorney Sky Woodruff said he reviewed Fair Political Practice Commission rules and found there was no conflict because the council was not voting on anything that would provide Candell’s business with a significant increase in revenue immediately.
Even if it were a vote, the regulations say the effect on Candell’s business interests must be “material,” he said.
“Materiality is whether the decision will affect the business entity’s annual gross income expense or asset value in an amount equal to or more than $1 million, or 5% of the entity’s gross revenues,” Woodruff said. “I discussed the standard with Councilmember Candell. … He wanted to note immediately, and I feel it’s important to also note, that he would not provide his services to businesses in Larkspur.”
The workshop to gauge the community’s interest in allowing dispensaries was Candell’s idea, and was raised at the last strategic planning session, said Schwarz.
Candell said he brought the idea to the council as a way to consider generating more tax revenue after the city cut its budget to close a $2.7 million gap due to the coronavirus “shelter in place” order.
“From my knowledge of the industry, if we did have a dispensary we can expect somewhere neighborhood of $1 million per year into our general fund,” he said. “And for a city the size of ours that’s probably 7% of our budget, which is about a $15-$16 million budget. That’s not something that I want to just turn my head and say, ‘Ah, forget about it.’”
He said he understands those with concerns, but he said putting dispensaries on the ballot would be a better way to gauge community interest.
“I think that’s probably the most equitable way to hear from the citizens of Larkspur, as opposed to the vocal minority that happens to show up at a council meeting,” Candell said.
Mayor Catherine Way said the overwhelming opposition to cannabis dispensaries by residents who called in or submitted letters was enough to table the idea.
“We understand that the community at this point is not interested in changing our current ordinance that prohibits cannabis retail business within the city and jurisdiction of Larkspur,” Way said.