City threatens landlord, nonprofit with citations
One week after opening near the busiest intersection in downtown
Hollister, a medical marijuana dispensary is preparing for a legal
battle with Hollister officials who claim Purple Cross Rx is
operating in violation of zoning codes.
City threatens landlord, nonprofit with citations
One week after opening near the busiest intersection in downtown Hollister, a medical marijuana dispensary is preparing for a legal battle with Hollister officials who claim Purple Cross Rx is operating in violation of zoning codes.
From the perspective of the dispensary’s director, Hollister resident Scott McPhail, the nonprofit is a vital caregiver that provides a service permitted by the state. It is located between Third and Fourth streets at 335 San Benito St., two floors above The Ink Shop tattoo parlor.
City officials, however, said earlier this week they planned to serve both McPhail and his landlord, Greg Dolan, with an order to shut down the dispensary within 30 days or face penalties potentially including $1,000-per-day fines.
Zoning questioned
The city, said Code Enforcement Director Mike Chambless, believes a pot dispensary is not an approved use in the commercially-zoned district. McPhail and his lawyer contend nonprofits such as Purple Cross are permitted in the area.
“Once a property goes into non-compliance, no permits or licenses can be issued at that property,” said Chambless, indicating that other businesses in the building, ranging from a hair salon to real estate companies, could not renew their business licenses when they expire once the order is issued to the property owner.
“We are zoned for this,” countered McPhail. “Nonprofits belong in commercial zones.”
McPhail, a 32-year-old father of three, said he has been a medical marijuana user for the past 10 years since injuring his back in a vehicle accident near Bolado Park. A self-described “knucklehead” in his younger years, McPhail said though he “never was violent – I was free-spirited” and served time in San Benito County’s Juvenile Hall. While a student at Gavilan College, with two children by the age of 18 and a goal of getting into law enforcement, he “made a mistake of trying to make ends meet and got in trouble for having marijuana.”
He was convicted of a felony and “did a lot of jail time for that.”
Now CEO of Felony1 Records, with offices just down the hall from Purple Cross Rx, McPhail – dressed in a white, button-down shirt and tie – said his troubled past is behind him.
“It’s a stigma I have to live with, but since that time my life has been righteous,” he said. “I’m a Christian. People that know me love me and people that don’t read me by my cover,” which includes tattoos on his neck and knuckles.
Active in the ‘movement’
McPhail said he has been “active in the movement” to support the doctor-approved distribution of medical marijuana, though his idea to open a dispensary came just within the past two months.
“The idea came about when [President Barack] Obama told attorney generals to leave medical dispensaries alone. He told the DEA and the Feds not to waste our money on them and go after the cartels,” McPhail said. “What was holding this movement back was the fear of federal prosecution.”
Since the president’s order, medical marijuana dispensaries have sprung up around the Central Coast, including in Gilroy, with others already opened or in the works.
“This battle has played out elsewhere, and the dispensaries have always prevailed. If the president says it’s all right [for dispensaries to operate], what gives the mayor the right to say they can’t?” McPhail said, referring to Hollister Mayor Victor Gomez, who opposes Purple Cross Rx operating in the city.
Dispensary battles waging in SoCal
Gomez, a Papa Murphy’s franchise owner, said the city has explained to McPhail that he is in violation of city codes because anything that is counter to federal law also violates local law. In this case, he says, the sale of marijuana, even for medical purposes, is also against city code. However, Gomez acknowledges that the legalities may not be cleared up until a decision is made on a pending state appeals court case in Southern California considering whether cities and counties can prohibit medical marijuana dispensaries.
“I’m not at this time comfortable with expending the taxpayers’ money when it comes to going after these guys in court mainly because of that situation that’s going on down in Anaheim,” Gomez said. “That case there is really going to make a difference in how we deal with dispensaries statewide. It’s pointless for me to tell these guys to get out of here if the state’s going to come in and say we don’t have that authority.”
Despite that, Gomez said he expects cooperation from local landlords willing to rent to dispensaries. Purple Cross originally planned to open in an industrial park near the airport at 2300 Technology Parkway, but that landlord decided against renting to the dispensary once the city expressed its concerns.
“We want to work with [building owner Greg Dolan] and he should want to work with us. My desire is for Greg to terminate the lease with Purple Cross and be in accordance with our zoning code,” Gomez said. “Then, we’ll do this the right way.”
Building owner expects backlash
Dolan said he has a month-to-month lease agreement with Purple Cross because he “expected a backlash.”
“I did my research. These people already rented from me and I read their proposal to the city, which looked all good to me,” Dolan said. “They provided security – everything is being done above-board. I’ve gotten to know them personally over the past year and I never judge a book by its cover.
“The rent has been there on time every month. They keep the place clean. I needed the spaces rented out, so it was attractive to me, but I wasn’t going to jump into anything blind. I was paranoid that it could be a free-for-all mess, but I’m pleasantly surprised at how efficient they are.”
Armed security guards man the back entrance to the building and are also stationed inside the third-floor lobby shared by the dispensary, real estate firms and the record company. Only people holding doctor-approved medical marijuana cards are allowed inside the dispensary, where patients much register and have their card checked two more times before being allowed to purchase prescription-sized bottles of cannabis with cash.
Dolan, who said that security was so tight he couldn’t immediately get into his own building recently, said that he expected scrutiny of his tenant’s dispensary and was “waiting for the citation” from the city code enforcer.
“I’ve got six kids and I’m not going to get a bad name for running a free-for-all marijuana shop in Hollister,” he said, praising Purple Cross’ intention to donate 5 percent of gross revenues to local community organizations. “So far we’ve been very impressed. I haven’t had one complaint. Matter of fact, I’m very surprised by that.”
Hollister Downtown Association Executive Director Brenda Weatherly said she wasn’t aware of the dispensary opening downtown until early this week, when a colleague told her the news.
“I’m kind of surprised” that it opened downtown, she said, adding that she expected the topic to be on the HDA executive board’s agenda at its mid-week meeting. “Personally, I have no problem with medical marijuana but I think it should be dispensed by a pharmacy, like any other controlled substance.”
Weatherly said she doubts much can be done legally to force a dispensary to move “because the state has allowed this use even though cities and counties disapprove of it. There’s an inconsistency.”
Vague law leaves city in ‘new territory’
Asked how she thought a dispensary could affect other downtown businesses, Weatherly said she had “no idea. It’s new territory.”
Gomez said state laws regarding the use of medical marijuana feature “huge loopholes that hurt every municipality.”
“To an extent, I agree with what [McPhail] is saying that they can interpret it their way and we can interpret it our way,” he said. “I don’t think it’s in the landlord’s best interest to get in the middle of vague law. The zoning code is not vague and is easy to understand when it comes to the landlord.
“Whether we have the right to tell a dispensary to operate or not, that’s the vague part. If it was my choice, maybe things would be different if marijuana was distributed at a pharmacy. I’m not arguing whether medical marijuana works or not – I’m not a doctor. I’m concerned how easy it is for marijuana to get into the wrong hands.”
Gomez said he has attempted to contact the state attorney general’s office in order to get its perspective on Hollister’s concern over the marijuana dispensary, but got no response. City Attorney Stephanie Atigh could not be reached for comment by press time.
Gomez said the City Council may discuss the issue at its Jan. 19 meeting, though that was not confirmed as of mid-week.
Hollister Police Chief Jeff Miller said he would not “discuss any strategies” regarding enforcement near the dispensary, which is accessible by an alley that runs behind Baler Market.
Asked whether having an admitted drug felon operating a medical marijuana dispensary was a concern to law enforcement, Miller said: “I appreciate his being open and stating that he is a convict. It’s natural that people will be suspicious that he is now selling marijuana, though I’m not casting aspersions.”
Purple Cross Rx’s Web site, www.purplecrossrx.org, notes that it offers “fast, safe and confidential delivery service.”
Delivery prices range from $60 for an eighth of an ounce of marijuana to $420 for an ounce, with taxes and delivery charges included. Seniors and veterans receive a 10 percent discount, according to the site.
The room where patients purchase their vials of marijuana features two tables with laptop computers and a printer, but is otherwise sparsely decorated with a few plants and flowers. The shades are drawn but the room has ample enough lighting to show that day’s pot prices on a white board, with varieties such as “Grand Daddy,” “Purple Urkle,” “Citrus Haze,” and “God’s Gift” going for $20 per gram; and between $325 and $380 an ounce.
Despite his dispute with the city, McPhail remains hopeful that the two sides can find common ground, particularly since he estimates that Purple Cross Rx’s after-tax donations to community groups “could be in the hundreds of thousands of dollars” annually, according to a report presented to the City Council.
“I’m hoping they’ll have a change of heart and we can put this back on the table,” he said. “It’s important to a lot of people in this community. [City officials] may not like it, but we are doing the proper steps. I want to give so much back to this community for drug awareness, gang awareness, buying police dogs. We can’t give back if we can’t operate.”
