Miami Beach Sets Distance Requirements for Medical Marijuana Dispensaries February 16, 2019

Susan Askew

Miami Beach Sets Distance Requirements for Medical Marijuana Dispensaries: Commission decides against allowing dispensary in process to open



Miami Beach Commissioners this week approved rules that require minimum distance separation for medical marijuana dispensaries from each other. The final set of regulations were more restrictive than approved at first reading last month and leave one operator holding the bag after spending $1.2 million to set up operations at 1428 Alton Road.



Following approval of Florida voters to allow the use of medical cannabis, Miami Beach established regulations for the dispensaries including a 500-foot minimum distance separation from schools but did not include a minimum distance separation between facilities.



The ordinance approved last month on first reading would have required a 300-foot minimum distance separation between dispensaries or about one per block. The final version approved this week sets that minimum distance at 1,200 feet or one every four blocks.



At first reading, Commissioners also directed the ordinance include an “applicability clause” which would have made exceptions to the distance requirement for businesses that had a valid permit number for a medical cannabis treatment center or pharmacy prior to the legislation being approved. The dispensaries are treated the same as pharmacies under the City’s ordinance regulating them which means these new requirements apply to pharmacies as well.



Commissioners were set to vote in favor of that exception until West Avenue resident Gayle Durham made an impassioned plea for it to be dropped.



Currently there is one medical cannabis dispensary approved and operational: Surterra Wellness Center at 1523 Alton Road. Another dispensary to be located at 1439 Alton Road has approved building permits. Those would not be affected by this ordinance. Caught in the middle is MedMen which received a building permit process number prior to the ordinance’s passage on first reading. Without the exception, MedMen would not be able to finalize its building permit for 1428 Alton Road.



Regarding the distance separation, ordinance sponsor Commissioner John Alemán noted that since first reading the Quality Education Committee met and urged the Commission to consider a 1,200 foot minimum requirement. “That sounded like a lot to me at first,” she said, until she learned that the City of Boston requires “at least one half mile or 2,640 feet from another cannabis establishment. That’s probably a lot for a city of our size but it does lend credence to the Quality Education Committee’s recommendation to increase the distance,” Alemán said, adding that she was “amenable to a greater distance” suggesting “at least 600 if we didn’t want to go all the way to 1,200.”



“When we talk about medical marijuana we have to be thinking about the future and in the future, in the next few years, I suggest that we’re going to have recreational marijuana in the State of Florida,” said Commissioner Joy Malakoff. “It’s moving in that direction. So, I think we have to think about people lined up on the sidewalk looking to get their marijuana and not just for medical. I think medical is more controllable.”



Malakoff said she was not in favor of the applicability clause for the MedMen site on Alton Road, citing the one dispensary operating and the approved building permit a block away. “We do not want the 14th and 15th blocks of Alton Road, especially when it becomes recreational marijuana, to be the place to go and hang out to buy marijuana,” she said. “People will be lined up and I think it’s not fair because just another block further to the west are residential use.”



Malakoff said she had met with representatives from MedMen and they “looked like really good sound operators but they just need to find another place.”



Mayor Dan Gelber was also not a fan of the applicability clause but said he would vote in favor of the ordinance if there weren’t enough commissioners to remove it because he wanted to ensure legislation with distance requirements passed.



Commissioner Mark Samuelian said, “I support the applicability as we had on first reading. While I understand the concerns, to me it’s a fairness issue. We talk about being fair to business, being open to business, a set of folks made investment decisions, did something under a certain set of rules. To change it now in front of them doesn’t strike me as fair so I would support keeping the applicability as we did on first reading.”



Like Gelber, Commissioner Micky Steinberg said, “I want to pass something today on the distance separation and I understand there is a fairness issue so I’m open.”



Alemán agreed. “While I personally don’t love that density of dispensaries in that one little section, I do think it’s a little bit unfair to move the ball so much,” noting Medmen was “not early in their process. They’re way down the road.”



Gelber responded, “Clearly it would be unfair to them. The question is, is the unfairness enough?” to provide the exception.



Commissioners Ricky Arriola and Michael Góngora also supported the exception for Medmen.



“The residents of West Avenue are not going to be happy, I’ll tell you that,” Malakoff said. “They’re very close to that part of Alton Road. Like you, I’ll support it because it's important to get the distance separation in, but I just don’t think it’s fair to have three within a block of each other on a street a block away from residential.”



Arriola said, “I don’t think any of us are happy about it but there’s a fairness issue … This is exactly what I said was going to happen. I remember reaching out to the West Avenue neighborhood saying this is coming, stand up and protest, and it didn’t happen and now here we are.”



Then the protest came. Gayle Durham who lives on West Avenue between 14th and 15th Streets, one block away from what would be three dispensaries if the exception for MedMen were to be allowed, said “I’m so angry right now. I support the longest distance between cannabis dispensaries, 600 feet at a minimum, otherwise there’s going to be one on every block.”



Describing MedMen as a “billion dollar company” with revenue of $40 million in the last quarter, she said, “Please don’t feel sorry for them. Feel sorry for me and the people that live on that block.”



Holding up a map of the current and future dispensaries, she said the 10,000 residents of her neighborhood were losing good establishments to the dispensaries. “We already lost Pinkberry Yogurt to a dispensary. We lost Spring Chicken café to a dispensary. We lost Panera Bread to a dispensary,” which is the location of the proposed MedMen facility. “We all used to go there with our computers and drink coffee.” She said another dispensary wants to move into 1510 Alton Road, confirmed by City Planning Staff which noted an inquiry about the zoning for medical cannabis facilities for that property.



Meanwhile, she said, the medical cannabis facilities are attracting “sleazy hookah and vape shops… They’ve already replaced the dry cleaner at 1743 Alton and they replaced the picture frame store, a very nice neighborhood place at 1528 Alton, and the AT&T cellphone store. They’re like leeches that suck up to these cannabis dispensaries.”



Alemán said, “That’s very compelling… that’s why we introduced in this revision the distance separation between them because all of those establishments she’s describing, those are neighborhood establishments, the place to go get your dry cleaning, your cobbler, to go get a sandwich… that’s exactly the kind of problem we’re trying to address with these revisions so I thought that was very compelling testimony, Gayle.”



Arriola said, “There’s not this need for medical marijuana to have four dispensaries just on Alton Road and more to come… this is really the door for recreational marijuana and however people feel about that is fine. The difference is what do we want our retail corridors to look like. We’re constantly complaining about certain types of retailers coming in and then blocking out other types of retail we want in. I argue that recreational marijuana will push out certain types of retail that’s vital to a vibrant economy and if you want to have local restaurants and dry cleaners and places where kids and families can go, I think this kind of retail is dangerous with making no opinion on recreational marijuana but retail. As a retail establishment, I don’t think we need a strong proliferation of these.”



“That also drives traffic,” Alemán said, “because if I don’t have a neighborhood, you know, little market, I don’t have a neighborhood dry cleaner, I don’t have a cobbler, then I have to drive somewhere else further away to go get that and that’s a congestion contributor.”



“All this testimony is pushing me to more than 600 feet between dispensaries because I don’t want the neighborhood retail fabric to be corrupted in this way,” Alemán said.



Ian Bacheikov with Akerman, representing MedMen, said, “My clients have spent over $1.2 million on this property to date. They started the process under the existing code which allows for the dispensary.” He said Medmen received their demolition permits and completed the interior demolition, did “advanced concrete restoration” and then submitted their building permit and BTR (business license) application “toward the end of that process.”



Bacheikov said MedMen received comments back on their building permit before the ordinance was passed on first reading “and it was only on the second round of comments on their building permit did they get stuck in this position, so there really is an equity argument.” After spending $1.2 million he said, “the goalposts were moved.”



“Let us continue because we acted in good faith,” he told Commissioners. “We followed the code as it was passed, as it still stands today but for this ordinance. We absolutely do not object to any of the new distance separation agreements you’ve made but, based on the fairness and equity argument, we ask that you do allow us to continue.”



“It’s not going to be a smoke shop or vape shop,” Bacheikov said. “It’s essentially going to be a very classy establishment. It’s high end. It’s going to look more like an Apple store than a liquor store. It’s there to provide medicine to the patients on Miami Beach.”



Gelber responded, “In fairness, though, we know that whatever template for distribution is created now is going to quickly become smokable and once it becomes recreational, it’ll likely be the same. We have to assume that… So, I appreciate that but it’s really not the relevant thing because we don’t even know whether you’ll be the operator of it at some point. This is a template that’s going to last for a while.”



Bacheikov responded that the argument before the Commission was for a medical marijuana dispensary and not for recreational marijuana. “If this does get open, it won’t be a blight on the neighborhood,” he said. “Frankly, there’s only one dispensary open in the entire city and it does happen to be a block and a half away and to my knowledge it’s never once had a single issue. Its neighbors are still open and operating. There’s the Smoothie King, the Pinecrest Bakery. They don’t seem to have any problems. The people that are going there are few and far between. They’re patients.”



When Planning Director Tom Mooney said there had been no applications for medical cannabis treatment centers in Mid or North Beach, Alemán said, “I think that is an indicator… which says to me these companies are also anticipating the transition to recreational and that is why all of them have their eyes set on South Beach.”



Mooney clarified there had been an application for a location at 300 Arthur Godfrey Road in Mid Beach but they could not proceed because the spot was too close to a school.



Tara Tedrow of Lowndes, another attorney representing MedMen, said her client had been working on the 1428 Alton location since last July when it received a zoning verification letter. She said the space was under contract in August. Since then “significant work” has taken place.



“I don’t want anyone to leave tonight thinking we were looking for a loophole to get in before an ordinance was passed because that certainly wasn’t the case and isn’t the strategy of my client,” Tedrow said. “We are looking forward to investing $3 million into this site.”



“Not all medical cannabis treatment centers are the same,” she said. “A CVS and a Walgreens, they will dispense the same Ambien to all of us but medical cannabis treatment centers do not.” The treatment centers offer different products including suppositories, capsules, inhalation devices, vaporizer cartridges, patches, drops. “So, you can’t guarantee that the medication your physician recommends is actually at one of these dispensaries near you.”



As the Commission deliberated, Alemán said, “I found this testimony today very compelling and it has shifted my thinking to some degree. If it’s the will of the Commission, I’m amenable to removing the applicability language and I’m also willing to consider even greater distance separation than the 600 feet because I think that that neighborhood retail aspect is really, really crucial, I think, for the quality of life of the residents all across the City.”



Commissioners agreed unanimously to a 1,200 foot minimum separation between dispensaries. To remove the applicability clause – and block MedMen from the 1428 Alton location – required four votes. Malakoff, Steinberg, Gelber, and Alemán voted to remove it. Samuelian, Arriola, and Góngora voted to keep it in.



The Commission then voted 7-0 to approve the ordinance overall with the 1,200 foot minimum separation and no exception for MedMen. Attorneys for MedMen did not respond to a request for comment on what their next steps are.





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