Marijuana venture working to overturn Creswell’s pot ban

Soft Secrets
24 Jul 2017

One Gro wants to open a flagship marijuana dispensary in the city, but first it needs voter support

CRESWELL — Voters here soon may be asked to show their fickle side.

An embryonic but well-funded business venture led by high-profile Eugene attorney Mike Arnold wants Creswell residents to overturn the ban on recreational marijuana retailers that voters approved just eight months ago.

The backers of One Gro have big plans. They’re growing 40,000 marijuana plants on two new farms east of Cottage Grove, which they say could produce $3 million worth of pot this year. They have a patent pending on an inhaler that dispenses THC, marijuana’s psychoactive ingredient, that they hope to market in all states with legal recreational or medical marijuana. And they’re building an online marketplace to facilitate sales between legal pot growers and marijuana retailers, or dispensaries, in Oregon and California.

Setting up a flagship dispensary in Creswell, just off Interstate 5, is key to their plans, said Dan Isaacson, One Gro’s recently hired CEO. [caption id="attachment_9006" align="alignnone" width="990"] The OneGrow Investment Group, is working on a THC Inhaler to dispense doses. (Chris Pietsch/The Register-Guard)[/caption]

“We want this to be our Cupertino,” he said, referring to the California­ birthplace of tech giant Apple.

But first, company officials must convince Cres­well residents to reverse themselves on a marijuana retail business ban.

In November 2016, city voters approved the prohibition on marijuana retailers by a 129-vote margin, out of 2,467 ballots cast. Creswell joined 73 other Oregon cities — including Coburg and Junction City — and 16 counties that “opted out” after recreational marijuana was legalized statewide in 2014. Those local governments lose marijuana tax revenue but are able to prevent any pot-related businesses from locating within their limits.

Three small cities are set to ask voters to enact bans in 2018, but Creswell could become the first city in Oregon to go the other way and overturn a voter-approved ban.

The One Gro partners say the 2016 Creswell election result was close enough to warrant asking voters the question again. They have drafted an ordinance to do so.

They’ve poured $10,000 into a political action committee dubbed “Jobs and Freedom” and are working to gather the 509 signatures needed by Aug. 10 to refer their measure to voters in November.

Some city residents are embracing the effort, but others are skeptical.

Creswell Mayor David Stram said he wishes the initiative backers “would have respected the word of the voters.”

“I’m not sure why they are asking them again,” he said.

In a Facebook post, resident Keith Sears echoed that sentiment.

“Look, the people of Creswell voted for no pot shops. Why do you feel led to cram it down their throats?” he wrote. “Obviously a ton of money in it for you and let’s face it, that’s what this is about.”

But Isaacson stresses that the bustling dispensary that One Gro envisions also could mean a new stream of money for the city’s coffers.

If the dispensary has $5 million in annual sales, it could bring in $150,000 a year to the city, he said, plus a share of the state’s tax, worth $10,000.

Those projections are aggressive, however: The single dispensary in Veneta, for example, had about $1 million in pot sales in 2016, generating $30,000 for the city.

Despite the proposed dispensary’s proximity to I-5, Mayor Stram said he thinks the tax revenue would be “a trickle” rather than “a stream” for city government.

Earlier this month, One Gro opened a temporary coffee shop, NakD Bean, where executives hope to set up the dispensary. It’s a modest, long building on Ore­gon Avenue across from a gas station and near the on- and offramps to I-5. Isaacson said they will remodel the building to create a “boutique-­style” dispensary. Sandwich board signs outside advertise their intentions.

[caption id="attachment_9007" align="alignnone" width="990"] OneGrow Investment Group's CEO Dan Isaacson hopes to get approval of a marijuana dispensary in Creswell. (Chris Pietsch/The Register-Guard) OneGrow Investment Group's CEO Dan Isaacson hopes to get approval of a marijuana dispensary in Creswell. (Chris Pietsch/The Register-Guard)[/caption]

“We thought we’d do this to try to show people what we are about,” Isaacson said. “People have lots of questions.”

By pursuing the ballot initiative in 2017 rather than waiting until 2018, however, backers are giving opponents some fodder.

Under state rules, voters can approve a 3 percent local tax on recreational marijuana sales only in a general election. The next general election won’t take place until November 2018. That means if the ban is overturned this November, retail mari­juana sales would be untaxed in Cres­well for the first year.

However, Isaacson said One Gro will commit to donating 3 percent of its dispensary sales to local nonprofit groups until the formal tax is passed.

In the fast-evolving marijuana industry,

“if I wait a year, it’s like waiting 10 years,”he said.

The backers’ proposed ordinance has tight restrictions on where dispensaries could locate in Creswell. The retail operations would be allowed only in certain commercial areas and not within 1,000 feet of a city park or another dispensary.

That means if One Gro’s dispensary is approved, there appears to be no other place within city limits that another marijuana retailer could open.

“I won’t say that it isn’t by design,” Isaacson acknowledged. “Obviously, we are trying to get a competitive edge. But we feel we would be good stewards for the city.”

In addition to dispensaries, the ordinance would allow pot wholesalers and processors to potentially locate in Creswell, but only in commercial and industrial areas. Commercial grow operations still would be prohibited.

Arnold, a longtime Eugene attorney, gained prominence for briefly representing Ammon Bundy, a leading occupier of the Malheur National Wildlife Refuge, last year and defending Springfield resident Gerald Strebendt for a 2014 road rage shooting.

[caption id="attachment_9008" align="alignnone" width="990"] Marijuana plants wait in their four inch pots wait to be transplanted at a growing operation owned by OneGrow Investment Group. (Chris Pietsch/The Register-Guard)[/caption]

He has owned a farm west of Creswell for several years. On Facebook, where he’s been seeking investors for One Gro, Arnold wrote that the dispensary and One Gro employees based there could help spur other development and businesses for Creswell.

“It’s not about a dispensary,” Arnold wrote. “Complaining about that while allowing dollar stores, gambling and cheap malt liquor to run this town is the voters playing checkers rather than chess.”

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