Pot sellers face lengthy permit process after Pima Supes vote 3-2 on zoning
New dispensaries require 2 public hearings, could take up to 5 months to be OKed
Recreational marijuana sellers will face a lengthy process to set up shop in unincorporated Pima County after the Board of Supervisors voted last week to update zoning codes for dispensaries.
The “first significant change” to zoning codes for pot dispensaries in Pima County since 2010 puts additional pressure on prospective dispensaries owners, who will have to endure two public hearings and several months of waiting for their permits, which can be costly, said Chris Poirier, a county planning official.
The new codes, approved with a 3-2 vote last week, will allow dispensaries to open in any area that is zoned commercial or industrial, which gives them more options despite the long process. Dispensaries are also now able to grow marijuana in areas zoned for rural homesteads once they have permitted cultivation sites.
Supervisors Rex Scott and Steve Christy voted against the zoning changes. Scott opposed them, saying the permitting process needed to be more lenient, while Christy said the whole process already seemed “tortured” and tied up with “big money.”
“It just doesn’t seem to me that we should be asking prospective business owners to take on additional costs and additional time,” Scott said. “We wouldn’t be asking the same of other people who would be trying to locate business in that zone. It’s the worst possible example of government intrusiveness.”
Scott offered a motion to update the zoning codes without the need for a type 3 permitting process, which is the most laborious type of conditional-use permit for property owners, according to the county. The motion died for a lack of a second, however.
The county board will revisit the issue in a year to see if the permitting process has caused the “type of angst that I’m hearing might happen,” Supervisor Adelita Grijalva said Tuesday. Grijalva proposed the motion that the supervisors approved.
Former state Rep. Isela Blanc — who represented District 26 in Tempe — also spoke at the Tuesday meeting in opposition to the conditional-use permit requirement, saying “the last thing this group of people (the social equity licensees) needs is another burdensome barrier.”
Two voices of support for the changes came from members of the local cannabis workers' union under the United Food and Commercial Workers International Union.
“As a community-inclusive union, we believe there’s value in having a public process that includes a diversity of voices, perspectives and opinions beyond just cannabis industry owners,” Gayle Lutz, a member of the UFCW union, said. “Please don’t remove the public voice by removing the conditional-use permit requirements.”
Previous zoning codes only allowed dispensaries to open in unincorporated Pima County if they sold medical marijuana, a less taxed and less regulated version of the hallucinogen that requires a doctor’s prescription, and only allowed them to open in one zone “with a very expensive, enhanced type 3 conditional-use permit.”
The last significant changes to Pima County zoning codes, in 2010, were made after the legalization of medical marijuana. Arizona voters legalized recreational marijuana in 2020 with the passage of Prop. 207, but cities, counties and other local jurisdictions were able to keep regulating dispensaries through zoning codes.
Arizonans spent more than $2 billion on marijuana from January 2021 to January 2022, during the first full year that recreational marijuana was legal in the state.
Both Tucson and Pima County started revisiting their marijuana zoning codes in the weeks before the new licenses were awarded by the state Department of Health and Human Services in early April through a Powerball-style drawing.
Social equity licenses
Prop. 207 called for 26 social equity licenses to be awarded to members of Arizona communities negatively affected by the enforcement of marijuana criminal laws. They act as adult-use permits and allow for recreational-only dispensaries.
Critics of the social equity licenses said early on that they would just make cannabis industry giants richer and be inaccessable to the people they were meant to help by being tied up with beaucratic hurdles and high costs. Speakers pushing against the conditional-use permit at the supervisors' meeting raised many of the same points, with Blanc saying that "the point of participating (in the social equity program) is forgone" by all costs and bureaucracy at the state and local level.
Right now there are no recreational marijuana dispensaries in unincorporated Pima County or the city of Tucson. Because of zoning regulations there are only about a dozen dual-use dispensaries selling both recreational and medical cannabis.
Four of the social equity license winners had residential addresses in Pima County, but any of them could transfer their license to a different storefront address in other jurisdictions. Likewise, winners currently registered in other jurisdictions can transfer their licenses to storefronts in Pima County.
Those awarded the licenses have until October 2023 to open a dispensary or else “poof, they’re gone,” Poirier said. If the licenses aren’t used, they’re eliminated by the state and aren’t replaced or transferred to anyone else.
“You’re going to add at least four to five months with just the public hearing process,” Poirier told the board. He also warned that dispensaries usually have to shell out $30,000 in consultant fees for help completing the permitting process and finding areas zoned for them.
“You’re asking the applicant then to get something together very quick and then go through a public hearing process without any certainty of a positive outcome,” Poirier said. “If we require the type 3, folks better scramble to get their type 3 applications real quick.”
Some licensees are paying to reserve locations where they want to open a storefront, Poirier said, which is adding heavy costs. To be eligible for the social equity license, the winners had to come from some level of poverty — or even have been incarcerated.
“It’s already a hard task for these people to have made it through and then won essentially a lottery to get a license,” Poirier said. “We just want to be mindful of the process then for them.”
Location, location, location
Recreational pot sellers in Arizona can open their dispensaries anywhere in the state where local zoning codes allow, but they’ll likely choose the spot with the least red tape, Poirier told the board. He recommended that the supervisors leave out the requirement for the type 3 permit to avoid more bureaucracy.
Locations zoned to allow dispensaries are “extremely hard to come by,” Ryan Hurley, a Copperstate Farms consultant who is helping the social equity licensees get through state and local marijuana regulations, told the supervisors.
“There are no jurisdictions other than a handful of rural jurisdictions that allow a social equity only, recreational only license,” Hurley said. “The conditional use process is unnecessary and offers a level of burden that existing licenses only use to prevent competition.”
The county had a “stringent” permitting process for medical marijuana dispensaries, Poirier said. Only one dispensary, located just outside Ajo, has ever met Pima County’s marijuana zoning regulations. It moved to Phoenix shortly after opening.
Tucson is taking more time to decide what the city's permitting process will be for the social equity license winners who want to open in their jurisdiction. Planning officials for the city are “exploring” similar requirements, such as two public hearings, as well, Poirier said.
The Pima County Planning and Zoning Commission voted 4-3 in May to recommend that the supervisors approve the new changes but still require the lengthy conditional-use permitting process. Three members were absent from that meeting, however.
Supervisor Scott pointed out that “there wasn’t a whole lot of opposition” to leaving out the type 3 permitting process from the Planning and Zoning Commission.
The commission’s recommendation was “a core difference from what (county planning and development) staff was thinking,” Poirier told the board on Tuesday.
The recommendation from county staff was to allow dispensaries to be permitted “by-right,” or given a permit once they own property in a location that’s zoned for marijuana, which also avoids the hearing process.
“We are suggesting that this use (marijuana dispensaries) is no more impactful than the hundred of uses that are allowed by-right in those zones,” Poirier said.
Maricopa County allows by-right permitting for pot dispensaries while Coconino, Cochise and Santa Cruz counties have a "pathway" to by-right permitting for dispensaries, Poirier said. All of Arizona's "large more urban counties" have easier permitting processes similar to a by-right system, he said.
Tucson allowed their medical marijuana dispensaries to be permitted by-right after 2010. When Prop. 207 passed in 2020, all medical marijuana licenses in the state were upgraded to dual-use permits, allowing them to sell recreational pot as well.
Since 2020, Tucson has ended their by-right permitting, but “all the dispensaries that opened in the city got there by-right,” Poirier said.
Bennito L. Kelty is TucsonSentinel.com’s IDEA reporter, focusing on Inclusion, Diversity, Equity and Access stories, and a Report for America corps member supported by readers like you.