Buzz kill: Council walks back on Sparc pot dispensary

Uncertainty was interjected into Sonoma’s cannabis future this week when the Sonoma City Council failed to approve negotiated terms for a commercial dispensary license for Sparc, the Santa Rosa-based cannabis cultivation and sales company chosen to be Sonoma’s sole dispensary.

Less than half an hour into its Oct. 5 meeting, the city council cast doubt on its own selection process and halted forward progress on its effort to license a cannabis dispensary before the Nov. 3 vote on Measure Y. That signature-driven petition circulated in 2018 to allow multiple cannabis dispensaries in Sonoma with no city council oversight.

While all five of the sitting council members signed the official arguments against Measure Y in the official voter information guide, Monday’s “no action” vote may have given momentum to the Yes on Y campaign of Jon Early, the petition’s originator.

“What was determined last night was that the city council has promoted Measure Y for us,” said Early, who led the 2018 signature drive for Measure Y, in a message to the Index-Tribune following the meeting. “Nothing like a freebie.”

The agenda item was the latest step in a process to fulfill the agreement with Sparc for a retail-cannabis license. It was part of the meeting’s “consent calendar,” which includes items already vetted by the council and typically approved a final time without discussion. But members of the council or the public can request items be pulled from the consent calendar for further discussion, and the item was pulled at the request of Shivawn Brady, a supporter of an applicant for the dispensary license, Justice Grown.

Justice Grown came in second in the city’s application process to select a dispensary operator; their proposed location was in the building complex at 875 W. Napa St.

Before the discussion began, City Councilmember Rachel Hundley recused herself from hearing the item, saying that, “As some of my colleagues are aware, and members of Justice Grown, apparently, my husband a few weeks ago was in discussion about working with a ballot measure committee related to the cannabis initiative … concerns were expressed that this created a conflict for me voting on the said item.”

She said that though she didn’t believe she had a conflict, she requested an opinion from the state’s Fair Political Practices Commission, but would recuse herself so as “not to cause any decline in public trust on this item.”

Hundley’s husband, political consultant Sean Hamlin, last month approached Amy Jenkins, Sparc’s strategic advisor, about the possibility of launching a No on Measure Y campaign, operated under the name Sonoma Residents for Sensible Cannabis Access.

Hamlin’s proposal came several days after the unanimous award by the city council on Aug. 17 to Sparc for a Conditional Certificate to open a retail cannabis dispensary in Sonoma. In his message, provided to the Index-Tribune, Hamlin said he waited to contact Jenkins because “I wanted to make sure Rachel wouldn’t suffer the appearance of conflict.”

But news of Hamlin’s role in the campaign raised questions about a potential financial conflict of interest for Hundley, and Hamlin abandoned the campaign and dissolved the SRSCA. He said he never received any pay for his brief efforts.

Hundley’s recusal set the stage for a council discussion on the matter.

Councilmember Amy Harrington voiced concern over the dispensary selection process the council formulated over the past 18 months, though she herself was one of two councilmembers serving on the ad hoc committee that developed the process, along with Hundley.

“Obviously hindsight is 2020, but I don't think this is a good process,” said Harrington. “And I don't think that we should be awarding a monopoly to one person,” she said of the city’s ordinance allowing only a single dispensary license.

Harrington continued: “The more I learned of relationships that existed that I didn't know of, the more I realized I have been influenced without even knowing it.”

She also questioned the value to Sonoma of the Sparc proposal. “At the end of the day, when we were picking community benefits, the two groups that offered a million dollars in the middle of the pandemic didn't get picked. And the one that offered the least amount of money did.”

Mayor Logan Harvey conveyed his support for Sparc’s application and rejected Harrington’s implication that the $1 million in community benefits offered to the city should have weighed heavier in the council’s choice of applicant. Harvey said that the promise of $1 million in community benefits initially came from Coastal Retail Sonoma, an applicant with little actual dispensary experience that was rejected earlier in the process; and while Justice Grown said they would match Coastal’s offer, no actual financial plans to do so were ever produced.

The brief discussion, of less than four minutes, culminated in a 2-2 vote, with Harvey and Councilmember Madolyn Agrimonti in favor of accepting the terms, and Harrington and Councilmember David Cook against.

After a brief silence, City Manager Cathy Capriola asked City Attorney Jeff Walter: “So Jeff, that means no action on the item?”

“That is correct,” responded Walter.

On Thursday, Capriola clarified the status of Sparc’s application, and the city’s process. “The city’s commercial cannabis ordinance remains in place which allows for one retail cannabis dispensary, one non-store front dispensary, one manufacturing facility and one testing lab.”

Capriola added that “any future discussion about the commercial cannabis (request for proposal) process” would have to be re-agendized.

Following the Monday meeting, Hundley said her fellow council members were “simultaneously depriving Sparc of a fair process and improperly influencing an election.”

“The irresponsible actions by two of my colleagues may have wasted the significant amount of taxpayer money spent creating and implementing a thoughtful and responsible system for bringing commercial cannabis businesses into Sonoma,” Hundley wrote in an email to the Index-Tribune.

Eric Pearson, CEO of Sparc, offered a similar take.

“Thanks to the egregious actions of two city council members, Sonoma is one step closer to having unregulated cannabis businesses on every corner,” said Pearson.

Email Christian at christian.kallen@sonomanews.com. Jason Walsh contributed to this report.