A cannabis dispensary chain wants to start selling weed in what used to be Saint Paulus Lutheran Church at Polk and Sacramento Streets. But the SF Planning Commission refused to grant them a permit Thursday, over concerns they are “Big Canna” formula retail.
The SF Board of Supervisors placed a moratorium on new cannabis dispensaries earlier this month, but even with that moratorium, City Hall is still processing new dispensary applications that were already submitted before the moratorium was approved. And one of those applications that went before the SF Planning Commission Thursday was in a curious location. In what would likely be a first, a cannabis dispensary called Element 7 wanted to open in what used to be Saint Paulus Lutheran Church at 1541 Polk Street. (That church moved to 2325 Polk Street in 2022.)
But there was plenty of community opposition against Element 7 at Thursday’s meeting, alleging that the company ran afoul of SF’s formula retail rules. Element 7’s website says they have “a mission of becoming the largest cannabis retailer in the State of California,” and the SF Business Times reported in a 2022 profile of the dispensary chain that Element 7 “has cannabis retail licenses secured, permitted or under development in more than 25 California cities, per its website, and aims to have ‘more than 20’ operational dispensaries by the end of 2022.”
“They are formula retail. Big Canna. And they have a distinct advantage against our small local businesses,” executive director of the Lower Polk Street Community Benefit District Chris Schulman told the Planning Commission Thursday. He noted that the chain has 18 current and pending permits for retail marijuana stores, and a “desire for up to 100 stores in California alone.”
The Planning Commission was sympathetic and told Element 7 to redo their paperwork, delaying the approval hearing until September 14. That was after nearby dispensaries SPARC and California Street Cannabis Company claimed Element 7 was dishonest on its required formula retail affidavit.
“Element 7 was deceitful in their affidavit,” California Street Cannabis Company CEO Drakari Donaldson told the commission. “They stated they had eight existing locations, and two applications pending in San Francisco. When in reality, they had four (pending permits) in San Francisco at the time of the affidavit, and more than eight outside the city.”
“This is the Amazon-ification of our industry, which undercuts the local mom-and-pop businesses like myself,” Donaldson added, noting that “The neighborhood is already oversaturated” with four locally-owned dispensaries
And Element 7 apparently did themselves no favors in their required community outreach. Schulman claimed that “the applicant, at a community (pre-application) meeting, told equity applicants and other community members that if they were found to be a formula retail business, they would just change their name, trademark, etcetera, and come to you as a wolf in sheep’s clothing as a non-formula retail business.”
Element 7 chief operating officer Josh Black countered that they have dropped two of their four San Francisco applications, and said “we are only pursuing two locations in San Francisco.” And with regards to the Amazon-ification charge, Black said “We just work really hard, and we’re really ambitious.”
That did not sway the commission. “I wasn’t too thrilled to hear the enthusiastic opposition from the other operators,” commissioner Joel Koppel said before the vote. “So as of right now, I’m just not supportive of the project.”
Commissioner Kathrin Moore also opposed adding another Nob Hill dispensary on oversaturation concerns. “I’m really more in support of seeing the few nearby cannabis stores thrive,” she said.
The commission did not deny the permit outright, but delayed their vote to a September 14 meeting. They ordered the Planning Department to do more work on determining whether Element 7 is formula retail, and ordered Element 7 to square things up with all the neighbors and neighboring businesses who opposed them.
This could be a sign that in the dispensary moratorium era, where only a trickle of new pot shops will be approved, SF is clamping down on big national dispensary chains who trot out a local equity co-owner as a fig leaf to comply with local cannabis equity rules. Or it could be a sign that current dispensary owners are teaming up to keep any new cannabis competitors from coming into town.
Image: Saint Paulus Lutheran Church via Facebook