Officials discuss pot potential: Up to four marijuana dispensaries in Saugerties?

Saugerties could have as many as four dispensaries selling recreational marijuana within the next two years, depending on the responses of citizens and the identification of suitable locations, Supervisor Fred Costello said Monday, October 25 at a town hall-style meeting to discuss new state legislation allowing marijuana growing, production and sales.

New York State law now allows adults to possess up to three ounces of cannabis “for recreational use,” according to the state office of cannabis management website.

Panel discussion

David Holland, President of the New York City Cannabis Industry Association and Vice President of the Hudson Valley Cannabis Industry Association, said at last week’s meeting that the industry is compartmentalized: cultivation, distribution, retail sales are separate and the grower is not allowed to sell retail. “There is a 13 percent tax on cannabis sales, nine percent to the state, three percent to the town or village and one percent to the county,” Holland said.  The money can be used for any municipal expense; it need not be earmarked for drug enforcement. Part of the portion that goes to the state comes back to the municipalities in funding for enforcement and education. The town can also control the location of marijuana-related sales through zoning, Holland said. Communities are included in the law allowing marijuana sales unless they opt out, Holland said. Residents can petition the town to hold a referendum on whether or not to ban marijuana sales; ten percent of the eligible voters would have to sign the petition to force a referendum.

Ruben Lindo, a former football player and now a marijuana entrepreneur, grew up in Saugerties and attended Saugerties High School. In 2015, he got a job as a strategic adviser for a company that was developing a cannabis facility in Canada. “That led me to working with children” and with a large investor in a cannabis facility, he said. From there, he moved on to advising growers in Canada, Mexico and several American states. While he was not involved in growing marijuana, he got to see many operations. “I’ve been involved in legalization in Canada, Mexico, Illinois, Michigan, California and Nevada. And being involved in all those places, I got to see a lot,” he said.

When he returned to New York, he founded a company called Phoenix Pharmaceutical, which made products from the non-THC parts of the hemp plant, including muscle relaxants and pain relievers. He also acted as a consultant on questions of legalization for recreational use, including safety and the protection of children and youth.

A regulated industry

The marijuana industry is highly regulated, with detailed codes and frequent inspections, Lindo said. If any violations are found, he could be shut down for extended periods, so he is careful to operate within all the regulations, as are other operators, he said. “Every operator in the industry has an onus to operate safely because as an industry, we are only as strong as our worst figure in the industry, so we keep each other accountable,” Lindo said.

Lindo’s first contact with the cannabis plant came after he suffered a football injury; it was a non-hallucinogenic form. Since his involvement in the industry as a businessman, he owns four companies and he travels the world. However, he still feels that “Saugerties is special.”

The cannabis industry can be beneficial if done right; done wrong it can be harmful, Lindo said. He regularly consults with operators to improve the industry’s practices.

Lindo urged people to educate themselves about marijuana, particularly if they have an interest in production or sales. And those who oppose the Town getting involved in legalization have a voice to express their opposition, he said. He compared the development of the cannabis industry to such industries as the dot-com and automobile industries, which developed without public comment and participation. In the case of cannabis, the public has ample opportunity to express its opinion, he said.

In response to a question from the audience about whether the industry would be dominated by a few large sellers, Lindo said the system includes licensing for micro producers. New York City alone consumes four tons of cannabis a month, so many sources will be needed and there will be opportunities for small-scale producers, as well as large ones.  Just as there are small distilleries in the alcohol industry, there will be room for small producers in the cannabis industry.

How many marijuana sales outlets would Saugerties allow?

The marijuana sales outlets would be limited by the required distance between sales outlets and the need to keep them away from churches, schools and other specific facilities. 

Costello said he could see the possibility of four locations within the Town. He envisioned that the outlets would have to be at least a mile apart, further restricting their possible locations. “The zoning could accommodate four or perhaps three establishments.” 

One member of the audience said he doubted that in a town the size of Saugerties there could be enough demand among residents to support as many as three sellers, and the market would be based on visitors. Costello acknowledged that the Town’s population temporarily expands during festivals and special events such as the Garlic Festival and car shows, but “I don’t think that clientele is interested in purchasing marijuana.”

The Town now supports four liquor stores, Costello said, and that seemed like a reasonable model for marijuana outlets. The Town is looking at requiring a mile separation between marijuana outlets, and with the constraints on locating them, four outlets may be as many as could be accommodated within the appropriate zones.

Police Chief Joseph Sinagra acknowledged that there is not a test at present for marijuana, but funding is available for developing it. He pointed out that there were many years when people drove drunk and  there was not a breath test. And, while the presence of cannabis can be determined by a blood test, that test does not show how long ago the marijuana was ingested or smoked. As the market for alcohol first developed, there was no reliable test for sobriety. The location of bars was restricted, as is the location of marijuana outlets. Sinagra, as vice president of the New York Police Chiefs Association, is aware of and involved in discussions about enforcement of marijuana laws. Sinagra said, however, that it is good to have law enforcement involved in the conversation.

Village of Saugerties Mayor Bill Murphy said there are 14 bars in the Village, which contribute to the Village finances and serve the people in the Town and Village, as well as the many visitors.

As he developed his business, he needed carpenters, plumbers, electricians and other construction trade workers, Lindo said. Once a dispensary opened, restaurants and other businesses moved in to serve the new customers drawn to the area.

An indoor, factory-like production building would require high-powered lighting and heavy use of electricity, which could be a hazard for emergency personnel, Lindo said. Town Councilwoman Leanne Thornton asked whether the cannabis could be grown outdoors. Lindo agreed it could be grown in farm settings, though large-scale production might require the indoor, artificially lighted method.

Village trustee Donald Hackett said the Town and Village will have to make a decision quickly, as the deadline for opting out of the program is the end of this year. Town Supervisor Costello has said he favors the Town’s participation in the program as this gives it the ability to control the development of legal marijuana sales, including siting, required distances from schools, houses of worship and other facilities the Town may decide on.

The Town and Village plan to host a video conference on November 18 at 7 p.m. Costello said he hopes the same panelists will be willing to participate.