Of the Keizertimes

Keizer voters will have the opportunity to vote on attaching a 3 percent city tax on recreational marijuana sales in November.

Approval of a resolution sending the matter to ballot was one of several hastily-approved measures during a nearly four-hour meeting of the Keizer City Council Monday, June 20.

While recreational sales and the taxes applied to them are new territory for Keizer and Oregon, voters might find some of the language giving them pause. The text approved for the voter’s pamphlet includes the statement, “There is no way to estimate the amount of revenue the tax would provide to the city.”

However, a report released last week suggests it might not be as a big a mystery as voters will be led to believe in November.

According to mjbizdaily.com, a marijuana industry trade publication, the average annual revenue reported by dispensaries and recreational sales shops was $974 per square foot. That total puts the average pot shop between Whole Foods ($930 per square foot) and Costco ($1,032 per square foot). Apple retail stores topped the list with a whopping $4,799 per square foot.

Revenue per square foot is a measure of how efficiently a retailer uses space.

To date the city has only one licensed and operating dispensary in city limits, Alpha Alternative Solutions near the intersection of Hollyhock Place North and River Road N. Signs for establishments known as Kush, 4785 River Road N., and Oregon Bud Company, 3450 River Road N., appear to herald the arrival of at least two more.

However, Kush’s permit application is still under review by city officials and no one from Oregon Bud Company has yet contacted the city seeking a license, said Shane Witham, an associate planner with the city of Keizer.

Even with a modest estimate of 500 square foot per business, the city stands to reap about $44,000 per year on just those three retailers and, according to city ordinance, a retailer can open every 1,000 feet. Also, according to the ballot text, there are no restrictions on how city officials can use the money collected from the tax on recreational sales.

There are also other questions lingering about the operation of the shops.

In February, the Keizer City Council approved amendments to Keizer’s marijuana permitting process that included rules stating that retailers would be granted on a first-come, first-served basis, but only after the Oregon Liquor Control Commission had granted a state retailer license. At the same time, the council added the 1,000-feet requirement.

Both of those amendments now stand the potential of creating conflicts, said Witham.

“The rules governing medicinal dispensaries stipulated a separation requirement of 1,000 feet, but those haven’t yet been applied to recreational sales,” Witham said. “Which means the city may be put in the spot of being the bad guy and telling retailers they can’t operate in a certain area.”

There are already businesses within 1,000 feet of both Kush and Oregon Bud Company that have submitted land use compatibility (LUCs) documents expressing a desire to incorporate marijuana sales into their offerings. LUCs are frequently the first step to begin the permitting process.

Complicating things further is that Oregon Bud Company changed the sign at its site without warning and without any contact with the city. Oregon Bud Company was within Keizer’s sign codes to change the sign because it only changed the content and not the size or placement. Attempting to reach the business owners through phone numbers listed at their website results in either endless ringing or a fax line.

Witham said he and other city staff have been visiting both Kush and Oregon Bud Company every few days to make sure they are not open for business without having completed the permitting process.

Kush’s permit to operate in Keizer is currently under review, and it is the only other dispensary in Kezer – Alpha Alternative Solutions was the first -– registered with the state as yet.

Witham said there are also other complications in the pipeline.

“The rules originally said that dispensaries could only be licensed as either medical or recreational, but now it seems like that is in flux,” Witham said.