White Salmon considers city-run marijuana shop

First attempt at beginning process fails; council meets Nov. 6

Concerns regarding cost and community impact bubbled to the surface of a special meeting of the White Salmon City Council focused on potentially seeking a license to open a retail marijuana shop.

At a special meeting called Oct. 28 to discuss the process for obtaining one of three retail marijuana licenses available in Klickitat County, a divided council decided to not initiate the lengthy application process, mostly citing the cost it would take to do so. Councilors Mark Peppel and George Rau voted “yes” on the matter with Councilors Bill Werst and Allan Wolf voting “no.” Councilor Jason Sabourin was not in attendance.

Despite the failure of the Oct. 28 motion, Werst noted after the vote that he would be interested in bringing the issue to the floor again during the council’s next meeting on Wednesday, Nov. 6.

Werst’s primary issue with giving city staff the go-ahead to pursue a license through the Washington State Liquor Control Board was the $7,500 price tag.

“Just from my personal business experience we don’t have to accept the first number offered to us. I like where we’re going and I support you spiritually, but I will vote ‘no’ on this one for that reason,” Werst said.

White Salmon Mayor David Poucher explained to the council before the meeting that opening a retail marijuana shop could be a source of revenue for the town. The option to open such a facility stems from Washington Initiative 502, which was passed by voters last year and allows those aged 21 and older to possess up to 1 ounce of marijuana as long as it is consumed within the confines of their home.

Entities interested in applying for a license will have the chance to do so between Nov. 18 and Dec. 17. The City of North Bonneville is currently planning to apply for a license of its own and John Spencer, former city administrator for North Bonneville and consultant for Pulse Consulting, spoke to the council via teleconference on Monday.

Spencer indicated that just to begin the application process, which includes an operating plan and site design, could cost as much as $7,500. Poucher said covering the internal cost of paying for city employees to work on the application would probably cost another $7,500.

The operating plan would include everything from training and hiring practices to inventory on to how to destroy unused product. The building design must include secure storage, security cameras, be at least 1,000 feet from schools and parks, and meet a variety of other standards set by the WSLCB.

As with North Bonneville, Spencer recommended White Salmon create a Public Development Authority to oversee the operation of the marijuana shop. To do so, City Attorney Ken Woodrich would have to create a new ordinance first so the new PDA could be the licensee to the WSLCB for the shop.

“But the city can’t run the PDA; I think you have to make that distinction and it’s an important distinction. City staff aren’t going to be down there minding the till at this facility,” Woodrich said.

“It is a liability buffer. It’s kind of like a separate corporation; that’s why you can’t share resources with them because you lose that veil of protection. The only way you can share resources with them is by treating them as a separate entity.”

Spencer said that if the city were to manage a pot shop through a PDA it could have control over the location, advertising and staffing; whereas if a private, unaffiliated entity were to open a shop in White Salmon the city would have little to no say in its operations.

He also stressed that while White Salmon’s location is beneficial to opening a retail marijuana store, there are never any guarantees when starting any type of business.

“I don’t want anyone thinking that this is an automatic cash cow; though I do think the chances of it being profitable are strong,” Spencer said.

And then there is the issue of the number of licenses available in Klickitat County. If more than three entities apply for licenses, the WSLCB will conduct a lottery-style selection process, meaning White Salmon could potentially spend the money to apply for the license and then not obtain one.

“So fortunately in Klickitat County since there are three at-large licenses your odds are slightly better than in Skamania where there are only two at-large licenses; but it is a lottery, so there is a chance you would spend the money to do this study and end up with nothing because you wouldn’t be selected,” Woodrich said.

After hearing from Spencer and Woodrich about the PDA and licensing process, councilors debated whether or not the risk is worth applying for the license at all.

Despite his “no” vote, Werst agreed with Peppel, who said the city needs to take advantage of opening a pot shop as an economic opportunity, especially while competition is scarce.

“It would just frost me if four years from now I’m looking over at Hood River Port and they’ve got a whole operation going over there and our people are once again driving across the bridge to spend their money,” Werst said.

Bingen-White Salmon Police Chief Tracy Wyckoff said during the meeting that at the very least the council could use the opportunity to form its own pot shop as a way to better monitor its distribution.

“Right now it’s such a mess for us to deal with I would like to see some structure to it, so we know where we stand on what sort of enforcement actions we can take. Right now it’s just kind of in the air. It’s really, really hard for us,” Wyckoff said.

“So overall no, it’s not something I’m thrilled about coming into our society, and I do understand your reasoning behind getting on board and making a money from it when it’s coming here anyways.”

Councilor George Rau, who cast a “yes” vote on Monday, voiced some concern about whether or not the city forming a PDA to operate a marijuana shop is best for the community.

“One thing we did last year was focus on changing the vision statement to say that this is a great place to live, work, play and stay,” he said. “If we raise the bar by allowing within city limits a dispensary of recreational marijuana, are we actually degrading the life quality of the citizens? Are we seeking revenue but in adverse fashion to the detriment of the community?

“So we go back to those fundamentals and ask, ‘Does this fit in our city mission?’” Rau said.

Though the council ultimately voted not to pursue the marijuana retail license at Monday’s meeting, the panel did decide entities interested in opening a pot shop can lease property from the city, especially if the city could potentially require lessees to pay a certain percentage of their gross profit; though Woodrich said he was unsure whether that is legally possible.

“We have had two individuals who haven’t put anything in writing; they’ve only talked to us verbally because they don’t want anyone to know what they’re doing; but basically they said, ‘We might be interested in that.’ So maybe it would be better for the city to say, ‘We have this piece of land, this is our lease and we want x percent of the gross from it,’” Poucher said.

The White Salmon City Council meets again Nov. 6 at 6 p.m. in council chambers at 116 N.E. Church St.

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