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Council approves two cannabis facilities

North Hollister sees more than 30 proposed

The Hollister City Council’s approval of two cannabis facilities Sept. 16 added to a growing list of such businesses in the north end of the city.

According to a map of cannabis businesses by the city’s Cannabis Affairs Office, a total of 34 businesses are in various stages of approval. Nearly all of the businesses are proposed on streets surrounding San Felipe Road near the Hollister Municipal Airport, where the land is zoned light industrial.

With no discussion and no public comments, the council unanimously approved Just an Herb’s application to operate a 13,752-square-foot cultivation facility at 1920 Airway Drive, as well as California Finest Manufacturing’s request for a manufacturing facility at 1785 San Felipe Road.

City Manager Bill Avera said California Finest Manufacturing’s proposal was previously approved by the city, but its permit expired before it started work on the facility.

Just an Herb’s proposal received approval by the planning commission in June, and will require constructing a new facility on the currently empty lot.

Victor Gomez of Pinnacle Strategy, who helps cannabis businesses navigate city approval processes, said the lack of vacant and compatible buildings is one of the challenges facing cannabis entrepreneurs, who must make the costly investment of constructing their own facilities.

“The investment for some of these guys is in the tens of millions,” he said.

Hollister has received about 50 applications for various cannabis businesses since the council approved its ordinance in December 2016, according to Gomez.

“Hollister was a trailblazer when it comes to policy development and ordinance adoption,” said Gomez, a former Hollister mayor. “They came on board really early.”

While the city only allows two dispensaries, there is no limit on the number of other types of cannabis licenses that can be issued. According to Hollister’s ordinance, cannabis businesses can only operate in five zoning districts with various setback requirements, such as 600 feet from a school and 150 feet from residences.

As such, Hollister might seem more welcoming than neighboring jurisdictions to businesses looking to set down roots.

The City of Gilroy prohibits all commercial cannabis activity, as does unincorporated Santa Clara County.

The Morgan Hill Planning Commission on Aug. 27, meanwhile, recommended the city council approve a cannabis ordinance that would allow retail sales, manufacturing and more. The council is expected to vote on the ordinance in October.

Morgan Hill voters in 2018 approved taxing cannabis businesses if they subsequently were allowed in the city.