Royal Oak City Commission to consider city's first recreational pot licenses

Mike Martindale
The Detroit News

Royal Oak — The City Planning Commission has signed off on controversial plans for what might become the city's first recreational marijuana facility and denied a request from another operation seeking to locate near a school.

The commission's Wednesday decisions capped a lengthy and heated meeting over plans and permits for Gatsby Cannabis Co. on Meijer Drive near a vocational school and Royal Treatment, which is planned near a residential area on Harrison. 

Proponents have argued the establishments would fit with existing commerce and neighborhoods, provide tax benefits and jobs. But those opposed, including the county’s intermediate school district, raised concerns over potential disruptions for students and neighbors.

Royal Treatment rendering for proposed marijuana facility at 420 E. Harrison Avenue in Royal Oak.

After listening to public comments from upset residents and parents, the commission rejected Gatsby’s request by a 3-2 vote. Despite objections over Royal Treatment's proposal, the commission supported its plan by a 4-1 margin.

Sheri Stuart, a spokeswoman for Oakland Schools, said the district is "pleased" that the commission voted to not recommend the application for a special land use permit and site plan by the Gatsby Cannabis Co. for approval by Royal Oak's City Commission.

“However, our work does not end here,” she added. “We are deeply concerned and remain on high alert knowing that a marijuana facility would operate only 88 feet from our OSTC-SE campus if approved by the Royal Oak (City Commission).”

Royal Oak City Manager Paul Brake noted planning commission decisions are "strictly advisory" and "any applicant who is rejected for approval has the right to go directly to the commission for consideration."

"The next step in the application process is to go before the city commission for final approval," said Brake, adding that the City Commission could take up the plans in March.

Gatsby has the option of appealing the planning commission's ruling to the City Commission. It is unclear whether that will happen.

The company's attorney, Dennis Cowan, a former mayor as well as city commissioner and planning commissioner, did not return telephone calls from The Detroit News.

The Gatsby Cannabis Co. rendering of a proposed marihuana grow, processing, and retail facility at 5130 Meijer Drive in Royal Oak.

Royal Treatment is represented by attorney James Rasor, also a former Royal Oak city commissioner and planning commissioner. 

Michael Thompson, president of the Lawson Park Homeowners Association, said he was disappointed the planning commission voted in favor of Royal Treatment’s plan, despite more than a dozen association members speaking out in opposition.

“We gave it our best shot …,” he said. 

Rasor has said the project calls for the adaptive reuse of an existing 3,000-square-foot building that would be remodeled with green technology and it's expected to create 50 jobs.

Attorney Brian Etzel filed a lawsuit against the city on behalf of Quality Roots, one of several dozen applicants not considered for recreational marijuana sites. The selection process for the municipal slots, he argued, did not comply with state law or city ordinance, which requires a merit-based, competitive process.

The suit and others have argued that there is a “corrupt” selection process for considering marijuana licenses for favored applicants, according to an Oakland Circuit Court lawsuit.

Brake has declined to discuss the allegations or legal action.

"It is pending litigation and we will have no comment," said Brake, who in a recent interview stressed no applicant had received any special consideration and none has been suggested by any elected officials.

Etzel's complaint alleges Quality Roots, despite a solid performance record in the marijuana business, was notified in January 2021 that it was not one of the finalists for the two municipal licenses. Quality Roots had proposed facilities at locations on Woodward Avenue and 13 Mile Road in Royal Oak, according to the complaint.

The selection committee that ranked the applications included Brake; city attorney Aaron Leal; Todd Fenton, economic development director; Tim Thwing, director of community development; former police chief and Assistant City Manager Corrigan O’Donohue; Susan Barkman, Brake’s assistant; and Treasurer Jaynemarie Hubanks.

All allegedly had access to restricted files of applications where they recorded and shared “review notes” for each application, according to the complaint.

They also met every Wednesday last August, without public notice before or after the meetings, according to the complaint.

Separately, attorney Kevin Blair filed suit last month against Royal Oak on behalf of Attitude Wellness, a Troy-based company that is part of Lume Cannabis Co, which has 30 marijuana retailers across Michigan.

Royal Oak rejected the license because the company hadn’t done any business in the city in two years, Blair wrote in his complaint.

“The city’s decision was motivated by a desire to promote local business and small business over larger operations with an established track record of regulatory compliance,” the lawsuit alleges.

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