The Merced City Council — with a majority of leaders who have voiced support for expanded cannabis ventures in town — has denied an appeal to stop a commercial cannabis business from obtaining a permit for a new retail store on Motel Drive.
The vote at Monday night’s meeting was 5-1, with Councilman Shane voting to uphold the appeal. Councilman Ronnie DeAnda recused himself from the discussion.
The Culture Cannabis Club plans to build a multifaceted retail dispensary of cannabis products for medicinal and recreational use at 1111 Motel Drive — the former Kewl Kats nightclub and also a former fine-dining location — a stone’s throw away from four hotels, including the FairBridge Inn and Suites, the Best Western Inn, the Pacific Express Inn and the Courtyard Marriott Merced.
There are also three other hotels less than a mile down the road. This “commercial thoroughfare” facing Highway 99 is also bordered on the backside by Pine Street with residential homes.
Devon Julian, the CEO of Culture Cannabis Club, told leaders the new site, to be known as “Culture Merced,” will have an armed guard 24-7, and a total of two guards during business operations. He said they have already been removing transient or homeless people who have been loitering on the site on a daily basis. The site is equipped with cameras and motion sensors, and the developers plan to build a barrier to separate the parking lot and back entrance to the residential area on Pine Street.
“We are trying to keep the property safe throughout the operations and the buildout,” Julian said. “We meet all setbacks and zoning requirements. … We want to redevelop an aging building and bring new life to the area. We have invested over $150,000 in the application process, building plans which are ready for permitting, and we are ready to break ground immediately.”
Representatives of the property owner have indicated that more than $850,000 has been invested in the property purchase and maintenance while the site has been vacant. On Monday night, one said the property ownership was ready to pursue litigation if the cannabis permit was denied. There was also word that the property owners would likely pursue another bar at the location as an alternative if the cannabis permit was denied.
Said Julian, “We do plan to contribute to the health and well-being of the community unlike the other alternative, as stated, could be a bar.”
City staff and the Planning Commission had already approved the permit for Culture Cannabis Club. They were the highest scoring applicant out of several that participated last year in a merit-based process designed by the city. The open permit is among five that the city currently allows for cannabis retail operations in town. Three dispensaries are actively selling retail cannabis right now in Merced, all north of Highway 99.
Edwin Kainth of the Merced Hotel and Lodging Association led the appeal effort against the permit for the Motel Drive location. He and other supporters of the effort said the project would negatively impact businesses, traffic, and families with small children in the area. They also pointed out a number of infrastructure deficiencies that have existed for quite some time along Motel Drive, including sidewalks in need of repair and ADA updates, and an overall lack of street lighting.
Councilman Shane Smith called his lone decision to uphold Kainth’s appeal as a “close call,” saying he supported the already-approved cannabis business plan, but not the location. “I don’t think the application fits the zone … We should uphold the appeal and give the chance for the applicant to find an alternative location.”
Before the vote, Mayor Matthew Serratto pointed out that Culture Cannabis had pledged to direct 2 percent of their gross revenue to “improving the community.” So as part of the motion to deny the appeal, Serratto managed to add a provision so that the company’s pledge would include support for “infrastructure” in proximity to the dispensary, as well as nonprofit community efforts.