CVIndependent

Thu12052019

Last updateTue, 18 Sep 2018 1pm

Casey Bahr, the owner of Revive Wellness Center, Spa and Salon, was notified by his landlord last year that his business would have to vacate the spaces Revive had occupied for 15 years.

Why? A new cannabis dispensary and lounge was moving into the same building—and that meant Revive would need to leave its home at 353 S. Palm Canyon Drive. Bahr had four weeks to find a new location capable of housing the multi-faceted operation he and his team had built since 2003.

“We had about four weeks to vacate, and during that time, it took us every minute to go through all the things that had accumulated, to clean things out and get ready to vacate,” Bahr said. “According to California law, you cannot have a medical practice in the same contiguous space as a salon or a spa. Since we had three separate areas (at 353 S. Palm Canyon), we were able to have the two separate businesses. But (when we were searching for a new location), there wasn’t a suitable space to accommodate both businesses in proximity to each other—so we just had to close the salon-spa, because we had to maintain the patient care from the medical practice.”

That closure meant a loss of income for Bahr—and a loss of jobs for his employees.

“All of our roughly 12 employees (on the spa and salon side) had to find other places to work, and a lot of them had been with us for a number of years,” Bahr said. “It was a big financial loss to us. We bought the business for $320,000 in 2003, and we had done about $100,000 worth of improvements in that facility. We had to leave it all. The furnishings, the cabinetry and the flooring can’t be taken with you. So, from an asset point of view, it was close to a half-million dollars that we lost. Also, the financial income from that business disappeared.”

What did the city of Palm Springs do to help out Revive?

“They were absent—completely absent, and there were no discussions with us, as the current tenants, regarding the new pot business,” said Bahr, who moved Revive’s medical practice to Kaptur Plaza at 650 E. Tahquitz Canyon Way. “I don’t know that it’s really their purview to worry about that; they just kind of let the chips fall where they may. But from what I’ve heard, they weren’t considering the impact on (existing) businesses when they took an interest in promoting pot businesses in the city of Palm Springs. Everywhere they allow those places to exist, the impact on the businesses continues today.”

Veronica Goedhart is the director of the Palm Springs Department of Special Program Compliance, which oversees cannabis-related businesses in the city. She said the city has had to make multiple changes to its regulations as the new legal-marijuana business has developed.

“There’s an evolution going on at the state and federal level, as the (industry) is so young and in its infancy,” Goedhart said. “It’s constantly evolving and changing. We saw three sets of state regulations before the final regulations were introduced. We have to make adjustments to make sure that all of our laws are in symmetry with what the state has. There are potentially more changes to come at the federal level, too.”

Amid all the changes, Goedhart said she has made a concerted outreach effort on the city’s behalf.

“We are working with our ONE-PS (coalition of Palm Springs neighborhood groups), and I’ve spoken with them directly,” she said. “Also, I’ve spoken to the (Main Street) Palm Springs merchant association with regard to the impact of the cannabis businesses on our community. We’ve been increasing our communication with them and listening to them and considering their feedback. I think that before that communication was taking place, (there was a) fear of the unknown. But they seem to be very receptive to the communication, and they are very receptive to the changes that will be coming forward with planning and with, potentially, a ‘green zone’ where we can direct cannabis cultivation to eliminate it from being so close to the city.”

However, with several marijuana businesses open in downtown Palm Springs—and more coming—some neighboring businesses have indeed been having issues, especially regarding odor.

I visited a number of shops situated adjacent to the Coachella Valley Green Dragon dispensary, in the former Revive building at 353 S. Palm Canyon Drive. Most of the people in the businesses (other than, of course, Revive) near Coachella Valley Green Dragon—a dispensary which will soon also include a lounge—said the cannabis business has had no noticeable negative impact on them.

Meanwhile, up the street at the recently opened Harvest House of Cannabis dispensary at 312 N. Palm Canyon Drive, staff at some of the surrounding stores and offices expressed uneasiness—and the smell of marijuana was definitely noticeable inside one of them. Most of the staff members and business owners did not want to speak for attribution, but said the odor was worst in the mornings and would dissipate as the day went along. Others commented that the odor was present sometimes on the sidewalk out front. The most positive response came from Scott Jones, vice president of Imagine It! Media, who went on record to say, “Harvest HOC has been a good neighbor—so far.”

When people at nearby businesses were asked if the city had been in touch with them regarding the arrival of Harvest HOC, I was told emphatically that there had been no communication at all. Also, it was pointed out that if an entrepreneur wants to sell alcohol—even just beer and wine—a sign must be posted on the front door or window of the business for 30 days, as per California’s Alcoholic Beverage Control organization. For cannabis, that is not required.

Goedhart conceded that the city has learned some lessons as cannabis businesses have moved into downtown Palm Springs.

“One thing we hadn’t realized was that with the (cannabis) businesses going into existing buildings, we had to make sure that they were taking precautions for odor control,” Goedhart said. “We had to make sure that all of our businesses are operating with plans that ensure there is no odor impact on the surrounding areas. We’re going to be introducing some new laws with regard to odor-control violations, and we’ll be implementing penalties for businesses that aren’t compliant. We’re actively working to ensure that any problems that could arise are addressed even before they happen. We’re working really hard with our community, and we’re working with our cannabis-business owners who are actually very responsive, very open and very helpful.”

Bahr, however, expressed concern about other existing downtown business owners as more marijuana businesses move in.

“It cost us a lot—and it sounds like there are other businesses that are experiencing the same result as we did,” he said. “It costs a lot to set up a building.”

Published in Cannabis in the CV

Last month, I examined the economic boom expected in the city of Desert Hot Springs as a result of its decision to embrace the cannabis industry. It was the first Southern California city to allow legal cultivation—and economic opportunities from the cannabis industry are helping turning the city around.

As for the other eight Coachella Valley cities … almost half of them so far have yet to welcome any sort of marijuana businesses.

The five that have opened the door in some way to the cannabis industry understand that it can help create a diversified economy that is less dependent on tourism and the resulting service-oriented businesses. Anyone who owns a business in the Coachella Valley knows that summers can be tough—but the new cannabis industry offers more year-round business and increased professional opportunities.

Dirk Voss, a lead cannabis consultant for Urban Management Strategies, is a former chairman of the Desert Hot Springs Planning Commission. He was directly involved in the approval processes for many of the cannabis businesses in the city and has watched the industry evolve throughout the valley. Voss said the cannabis industry can offer cities a “multiplier effect,” because the year-round economic stability of cannabis bolsters other business sectors, including entertainment, recreation, housing and more.

Because Coachella Valley cities have each embraced—or eschewed—cannabis in different ways, Voss predicts each city will eventually have its own cannabis “flavor” or “culture.” For example, Palm Springs has approved lounges, which makes sense for the city and its downtown tourist culture. The city is positioning itself to become a cannabis tourist destination based on its distinct assets, much like Desert Hot Springs has by promoting health and its mineral spas.

In contrast, Cathedral City has positioned itself for large-scale cultivation. The city has utilized vacant land and existing yet unoccupied shopping centers for such facilities, helping revitalize portions of Date Palm Drive, Highway 111 and Perez Road. Because Cathedral City had a lot of vacant buildings—with existing utilities and infrastructure—new marijuana businesses were able to save money by locating there. In other words, city leaders found a great way to utilize the city’s specific assets to accommodate the cannabis industry.

The city of Coachella has taken a different approach, mandating that projects have a five-acre minimum and be part of a master-plan development with specific cannabis zoning. Voss said these mandates have presented challenges to some interested cannabis businesses, “especially since power has been an issue. However, the city is evolving and expanding its plan to get the best economic development possible. The city has some catching up to do, but it is also in line to have a culture of major cultivation opportunities in the city.”

Palm Desert, meanwhile, has taken a slow, methodical approach to introducing cannabis businesses to the city—limiting the number of licenses to allow for slow growth. While this means the city may not see the economic windfall that, say, Palm Springs and Desert Hot Springs will, it also means the cannabis industry can be carefully incorporated into the city culture, thus avoiding over-saturation and allowing for manageable growth while the cannabis industry evolves.

At this point, cannabis businesses are not allowed in the cities of Indio, La Quinta, Indian Wells and Rancho Mirage—and this isn’t necessarily a bad thing. Because surrounding or nearby cities have embraced cannabis, residents and visitors can still enjoy the benefits of the cannabis industry without dealing with the hassles and costs of regulating it in their cities.

Because the cannabis industry is so new, it’s also somewhat unstable—meaning there may be growing pains for the cities that have embraced marijuana. Voss cautions some organizations will be bought out; some will close; and others will try to sell their licenses while the industry adjusts. It is crucial, according to Voss, that each city “design their ordinances and codes around their ability to adapt in an industry that is constantly changing.”

There is no doubt that marijuana can help the Coachella Valley evolve from a seasonal tourist-driven economy into an area with a stronger year-round economy.

“Each city will eventually find its fit, which will only lead to an overall economic boom within the entire Coachella Valley,” Voss said. “The industry is naturally designing its own characteristics for each city based on the needs, wants and use of cannabis by its residents.”

Robin Goins is a business consultant for DR.G Consulting and works extensively in the cannabis industry in the Coachella Valley. For more information, visit www.drrobingoins.com.

Published in Cannabis in the CV