Costa Mesa commission approves 3 medical marijuana businesses

Monday’s Costa Mesa Planning Commission meeting was a mixed bag for several proposed medical marijuana manufacturing and distribution facilities as commissioners approved three applications but delayed action on two others.

Commissioners awarded conditional use permits to Mellow Extracts, which plans to open in a 4,549-square-foot space at 3505 Cadillac Ave., Unit J5; JoshD Farms, which intends to occupy 10,007 square feet at 3505 Cadillac, Unit F9; and Sol Distro, planned for a 20,000-square-foot space in an industrial building at 3560 Cadillac.

The vote on each application was 4-1, with Commissioner Jeffrey Harlan opposed. The approvals are final unless appealed to the City Council within seven days.

Such businesses are permitted in Costa Mesa under Measure X, an initiative approved by local voters that allows firms that research, test, process and manufacture some medical marijuana products to open in the area north of South Coast Drive, west of Harbor Boulevard, south of MacArthur Boulevard and east of the Santa Ana River, though not in South Coast Collection.

Retail sales of marijuana and marijuana products are still prohibited in the city. Generally, the businesses approved Monday said they plan to extract, refine or otherwise use oil derived from marijuana plants for a variety of products, with finished goods transported out of the city for sale.

The businesses will be able to operate daily and up to 24 hours a day if demand warrants. Representatives of the applicants said that was important to give them flexibility to fill orders as they come in and be competitive in the market.

Commission Chairman Stephan Andranian said the city allows other industrial-type operations to have similar hours and that he was concerned about the possibility of Costa Mesa businesses starting “at a competitive disadvantage with similar businesses in other jurisdictions.”

“We’re not talking about a doughnut shop that’s going to be open to the general public,” he said. “We’re talking about a manufacturing facility that is closed to the public and does not allow for people to walk in off the street and buy a product.”

Harlan said he thinks the city has “a responsibility to promote businesses but do it in a regulated way.”

“I don’t think there’s an overriding concern that these businesses that are starting are going to be in any way hampered economically,” Harlan said. “There’s certainly a market, and creative businesses can figure out how to serve their clients and serve that demand given the environment they’re operating in.”

All the proposed businesses up for review Monday came prepared with a team of professionals to talk about their operations and security measures, which generally include installing cameras, alarms and lighting and having specified controlled-access areas.

A chemist for Mellow Extracts even addressed the commission while wearing a white lab coat.

No residents spoke against any of the applications.

Jim Fitzpatrick, a former planning commissioner and a consultant for most of Monday’s applicants, said medical marijuana businesses will work collaboratively to ensure the Measure X zone is well-monitored and secure.

He said he believes those efforts will make the area “the safest place in Costa Mesa.”

With the conditional use permits in hand, the operators still must secure final city fire prevention, finance and building safety approvals as well as obtain medical marijuana business permits and business licenses before they can open. They also will need state approval.

The Planning Commission balked at proposals from Se7enLeaf LLC to open a 2,299-square-foot operation at 3505 Cadillac, Unit M101, and a 4,360-square-foot facility in Unit L3 at the same property.

Commissioners expressed concern that products could be transferred from one location to the other.

“We keep loosening the bolts to try to fit everybody in and we haven’t gone down this road far enough to know if this is all going to work or if this is just going to be a huge mistake,” said commission Vice Chairman Byron de Arakal.

The commission originally voted 3-2 — with Andranian and Commissioner Isabell Kerins opposed — to deny the Se7enLeaf facility at Unit M101. Company representatives implored the panel to reconsider and said they’re willing to alter the operation so no product would be moved between the sites.

The commission eventually opted to delay action on both Se7enLeaf proposals until a future meeting.

Code changes

In other marijuana matters, the commission voted to move ahead with two proposed municipal code changes.

One would make permanent a temporary urgency ordinance the City Council passed last year to prohibit retail sales of marijuana and marijuana products and establishment of dispensaries, as well as limit marijuana cultivation to the extent possible under state law following the legalization of adult recreational marijuana use under Proposition 64.

That advanced on a 4-1 vote, with Commissioner Carla Navarro Woods opposed.

The other code amendment, endorsed unanimously, pertains largely to activities permitted under Measure X. Specifically, it would allow “adult-use marijuana to be distributed, manufactured, researched and developed and tested in the same locations and subject to the same permitting process and restrictions as medical marijuana,” according to a city staff report.

Both amendments will move to the City Council, which has the final say on whether to adopt them.

luke.money@latimes.com

Twitter @LukeMMoney