HomeMy WebLinkAbout2019.12.06.MM Commission PacketLansing City Clerk’s Office
Ninth Floor, City Hall, 124 W. Michigan Ave., Lansing, MI 48933-1695
517-483-4131 517-377-0068 FAX
www.lansingmi.gov/clerk city.clerk@lansingmi.gov
City of Lansing Medical Marihuana Commission Regular Meeting Friday, December 6, 2019 2:00 PM
2500 S Washington Avenue
City Clerk’s Training Room
Meeting Agenda
1.Call to Order/Introductions
2.Approval of the Agenda
3.Approval of Minutes from 11-15-2019
4.Public Comment on Agenda Items
5.Commission Appeal Hearings
•Blackstone Harvest – 6450 S. Cedar St.
•Weisberger Ventures II – 4213 S. Cedar St.
•Weisberger Ventures II – 511 E. Hazel St.
6.New Business & Updates
7.Public Comment
8. Adjournment
Chris Swope
Lansing City Clerk
Timeline
Blackstone Harvest, LLC
6450 S Cedar St Lansing,
Michigan 48910
June 26, 2019 – Application submitted ................................................................... 2
July 1, 2019 – Department review of applications begins
September 20, 2019 – Score & Rank Denial Letter Sent ........................................ 13
October 1, 2019 – Grow Application Submitted .................................................... 17
October 4, 2019 – Hearing Officer Appeal submitted ........................................... 18
October 8, 2019 – Second Score & Rank Second Denial Letter Sent ..................... 97
November 28, 2019 – Commission Appeal Submitted ........................................ 110
Exhibit 2 – Was not considered in reviewing section 35.
Exhibit 3 – Removed, wasn’t attached to section argued.
Exhibit 4 – Removed, wasn’t attached to section argued.
Exhibit 5 – Removed, wasn’t attached to section argued.
Exhibit 6 – Removed, wasn’t attached to section argued.
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September 20, 2019
Blackstone Harvest, LLC Joann Steil 22618 Shorewood Dr St. Clair Shores, MI 48081 Dear Provisioning Center Applicant,
The Lansing City Ordinance section 1300.6 discusses Provisioning Center license application evaluation. Your score of 73.50 out of 100 eliminates the possibility of scoring in the top five. Therefore, your application for licensure is denied.
Attached are your sub-scores based on the criteria posted on https://lansingmi.gov/1637/Medical-Marijuana and a brief summary of determining factors for each sub-score. You will not be selected to receive a Provisioning Center license in the City of Lansing for the proposed business at 6450 S Cedar St. You have the right to appeal this denial of licensure within 14 days of the date of this letter by filing with the City Clerk’s Office a written statement setting forth fully the grounds for the appeal pursuant to Chapter 1300.15(c). Please note that
initial appeals are referred to a hearing officer appointed by the City Clerk who will review the appeal and information submitted. The hearing officer will consider the information and make a recommendation to the City Clerk, who will make a decision on the appeal. To encourage efficiency, appeals will be conducted as a paper hearing without oral presentation. Please ensure that you include all information in your written appeal that you would like the hearing officer to consider. Appeals are limited to materials provided during the application process. No new application material will be considered on appeal.
Chapter 1300 provides that should the applicant not receive a license, one-half the application fee shall be returned. This refund will be processed after all appeals are exhausted.
Sincerely,
Chris Swope, CMMC/MMC Lansing City Clerk
CC: City Attorney Lansing Police Department
Chris Swope
Lansing City Clerk
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City of Lansing Provisioning Center Ranking 9/20/2019 3:51 PM
Total
Possible
Points
Blackstone Harvest LLC ‐ District Club‐6450 S. Cedar
Applicant Address ‐‐‐
#Category ‐‐‐Score Location of material Scoring Insights
1 Ownership Structure 1 1 Org Docs, Ownership Struc., 1 pg.Has structure. 8/12/19
2 Organizational Chart 1 1 Org Docs, Org Chart, 6 pgs.Has org chart. 8/12/19
3 Worker Training Program 1 1 OtherReqDocs, Worker Training Plan, 95 pgs.Has plan. 8/12/19
4 Short and Long Term Goals and
Objectives 1 1 Org Docs, Goals, 71 pgs.Has goals. 8/12/19
5 Community Outreach &
Education 1 1 Community Outreach, Outreach&Ed, 7 pgs. Has plan. 8/12/19
6 Marketing, Advertising &
Promotion 3 3 Marketing Five examples of minor minimization with good detail. Includes marketing materials. Includes
budget. 7/9/19
7 Tangible Capital Investment
Dollar Amount 5 5 4 page Investment Plan in TCI section Calculated $4,883,250 TCI from narrative. 8/12/19
8 Tangible Capital Investment
Own/Lease 3 3 19 pages in Lease with Permission in TCI Folder Stakeholder owns the property. 8/12/19
9 Tangible Capital Investment
Supporting Material 3 3 47 pages in TCI Supporting Documents Has supporting materials which fully corroborate stated/calculated TCI. 8/12/19
10 Financial Structure & Financing 2 1 Job Creation, Budget Revenue 1 page and Finance, Startup Costs
Budget 1 page 3 year budget with revenue and line item expenses. No startup budget attached. 8/21/19
11 LARA Pre‐Qual 3 3 demo of reg prequalification Received prequalification letter dated 7/18/19 for Blackstone Harvest, LLC. 8/12/19
12 Integration with Grows 4 0 Integration
Integration Plan
Integration plan says they will have grow, but does not have any application(s) submitted. Deemed
speculative. 9/20/19
13 Charitable Plans & Strategies 4 3 Charitable
Charitable Plan Plans to contribute $125K in cash and $10K in volunteer time. No receipts or agreements. 8/12/19
14 Number of and job
descriptions for PC ONLY 3 3 Job Creation
FTE's 34‐40 FTE's at PC. Job descriptions with adequate detail. 8/12/19
15 Healthcare 2 2 Job Creation
Healthcare Employer will provide healthcare. 8/12/19
16 Paid Time Off 1 1 Job Creation
Healthcare Employer will provide paid time off. 9/12/19
17 Retirement 1 1 Job Creation
Healthcare Employer will provide 401K or similar plan. 8/12/19
18 % of employees at $15+/hr 3 3 Job Creation
Plus 15 100% of employees will make $15+/hr. 8/12/19
19 Projected Annual Budget 2 1 Job Creation, Budget Revenue 1 page and Finance, Startup Costs
Budget 1 page 3 year budget with revenue and line item expenses. No startup budget attached. 8/21/19
20 Total COL Jobs 6 0 Job Creation
Lansing Jobs Has not submitted application for grow, therefore jobs are speculative 9/16/19
Total Business Plan &
Job Creation 50 37
21 Financial Litigation History 1 1 Financial Litigation History Form Financial Litigation History Form submitted on sole stakeholder. 7/10/19
22 Net Worth 3 0 6 pages in Financial Section of Laserfiche
Doesn’t have $100K in a bank account in the applicant’s name.
Doesn’t have solid proof of net worth. No submitted document in name of applicant. 9/16/19
Doesn’t have full documentation of initial start‐up and operating costs. 9/12/19
23 LARA Pre‐Qual 3 3 demo of reg prequalification Received prequalification letter dated 7/18/19 for Blackstone Harvest, LLC. 8/12/19
24 Stakeholder Experience
City of Lansing Businesses 1 0 Experience Stakeholder Resume Resume does not list any Lansing business ownership. 7/12/19
25 Stakeholder Experience
Relevant Businesses 1 1 Experience Stakeholder Resume Sole stakeholder has 18 years experience in a medical related field. 7/12/19
26 Stakeholder Experience
Medical Marijuana Business 1 0 Experience Stakeholder Resume Sole stakeholder did not list any medical marijuana related experience. 7/12/19
Total Financial Stability
&
Business Experience
10 5
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Impact on Neighborhood
Distance Between PC &
Residential Zoning
7 5
https://lansing.maps.arcgis.com/apps/webappviewe
r/index.html?id=be0634345255438ba55b14c9b19e9f
22
PC has residential zoned property within 1/4 mile. 9/20/19
115
City of Lansing Provisioning Center Ranking 9/20/2019 3:51 PM
28 Impact on Neighborhood
Density of PCs 7 1.5
https://lansing.maps.arcgis.com/apps/webappviewe
r/index.html?id=be0634345255438ba55b14c9b19e9f
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Lose 2 points for every existing PC within a 1/2 mile radius. None
Lose 1 point for every existing PC within a 1 mile radius. #5, #9, #10, #11, #13
Lose .5 point for every existing PC within a 1.5 mile radius.#2
Lose .25 point for every existing PC within a 2 mile radius. None
Lost 5.5 points. 8/12/19
29 Traffic & Parking 3 3 Public Service Review Tier 1 plan. Excellent parking/circulation. 8/30/19
30 Security Plan 3 3 LPD Review Tier I ‐ bank vault, on site guard, alarm system w/ color printer, panic button, off site video storage,
Man trap barrier, equipment specs 8/20/19
Total ‐ Land Use &
Resident Safety 20 12.50
31 Planned Outreach 1 1 Community Outreach, Outreach&Ed, 7 pgs. Has plan. 8/12/19
32 Improvements to Building 3 3 Building Improvements
Support Docs
SEV‐$280,600
Proposed Improvements $643,250.00 ‐ 229% of SEV
Has proposal from ZA Design Build which supports that amount. 8/26/19
33 Plan to Minimize Traffic 1 1 Traffic Study, Neighborhood Compatibility & Plans to minimize
traffic 10pgs total Has a plan. 9/12/19
34 Noise Plan 1 1 Noise & Odor
Noise Plan Has plan. 8/12/19
35 Odor Plan 4 3 Noise & Odor
Odor Plan, Odor Plan, 2 pages Has detailed plan, but no specs or budget. 8/12/19
Total Outreach 10 9
36 Stakeholder History
Proof of LARA Prequal 2 2 demo of reg prequalification Received prequalification letter dated 7/18/19 for Blackstone Harvest, LLC. 8/12/19
37 Demo of Regulatory
Compliance 5 5
https://bsaonline.com/SiteSearch/SiteSearchDetails?SearchFocus
=All+Records&SearchCategory=Address&SearchText=6450+s+ced
ar&uid=384&PageIndex=1&ReferenceKey=33‐01‐05‐10‐151‐
012&ReferenceType=0&SortBy=&SearchOrigin=0&RecordKeyDis
playString=33‐01‐05‐10‐151‐012&RecordKey=1%3d33‐01‐05‐10‐
151‐012%3a%3a4%3d33‐01‐05‐10‐151‐
012%3a%3a7%3d55b67cb1‐daee‐40e6‐9dae‐
9f2801426ce9%3a%3a13%3d4975&RecordKeyType=1%3d0%3a%
3a4%3d0%3a%3a7%3d2%3a%3a13%3d1
No code violations, no conditional denial letters. 9/12/19
38 Morals, Good Order & General
Welfare Litigation History 3 3 Morals Lit Hist Demo of Reg Has completed form(s) for all stakeholder(s). 9/12/19
Total Applicant
Stakeholder History 10 10
Total Score 100 73.50
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BLACKSTONE HARVEST, LLC APPEAL OF DENIAL OF PROVISIONING CENTER APPLICATION
Proposed Location: 6450 S. Cedar St., Lansing, MI 48911
Prepared by:
Nadeem Noah Harfouch, Esq. Mike M. Bahoura, Esq. The Harfouch Law Firm, PLLC Law Offices of Mike M. Bahoura, PLLC 631 East Big Beaver Road, Suite 211 631 East Big Beaver Road, Suite 211
Troy, MI 48083 Troy, MI 48083
Ph: 248-274-6529 Ph: 248-392-1586 nharfouch@harfouchlaw.com mike@bahouralaw.com
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TABLE OF CONTENTS STATEMENT OF ISSUES………………………………………………………………………3
INTRODUCTION………………………………………………………………………………..4
STATEMENT OF FACTS……………………………………………………………………….5 PROCEDURAL STATEMENT………………………………………………………………….7
STANDARD OF REVIEW………………………………………………………………………8 ARGUMENT………………………………………………………………….………………….9
I. Financial Structure and Financing (Section 10)……………………………………..10
II. Integration with Grows & Total COL Jobs (Section 12 and Section 20)……………13
III. Projected Annual Budget (Section 19)………………………………………………13
IV. Net Worth (Section 22)………………………………………………………………17 V. Odor Plan (Section 35)…………………………………………………………….…18 CONCLOSION AND RELIEF REQUESTED……………………………………………….…19
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STATEMENT OF ISSUES 1) Were the scores given to the applicant based on clearly erroneous findings?
Answer: Yes.
2) Were the scoring decisions based on and supported by competent material and substantial evidence?
Answer: No.
3) Were the scores based on inconsistent scoring? Answer: Yes.
4) Was the scoring in compliance and in accordance with Lansing’s ordinance? Answer: No.
5) Were the scoring decisions arbitrary and capricious?
Answer: Yes. 6) Should the decision to deny the application be reversed?
Answer: Yes.
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INTRODUCTION
Blackstone Harvest, LLC (“Blackstone”) is a state prequalified entity pursuant to the
licensing provisions of the Medical Marihuana Facilities Licensing Act (MMFLA) and
Administrative Rule 5 (R 333.205). Blackstone is owned by a single member, Joann Steil, who
has over fifteen years of experience in the health care industry. Ms. Steil has successfully owned
and operated a health care case management company called Advanced Placement Services. She
works in collaboration with physicians, patients, and their families to ensure safe and efficient
transitions of care.
Blackstone recently applied for a provisioning center license with the City of Lansing
under its ordinance and in accordance with the MMFLA. Blackstone also applied for a medical
marijuana grower facility license in the City of Lansing. Blackstone was a qualified applicant
that submitted complete documentation for all categories considered for scoring.
A full review of the application would corroborate that the denial of Blackstone’s
application in Lansing is unjustifiable because 1) plans and documentation submitted by
Blackstone were ignored or poorly reviewed, and/or 2) the City did not follow its own guidance
on scoring in accordance with the applicable rules and ordinances and made reversible errors
based upon an abuse of discretion and arbitrary and capricious decision making.
Blackstone hereby submits this appeal for review of its score and status in the City of
Lansing and respectfully requests a reversal of the City’s decision to deny Blackstone’s
provisioning center application.
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STATEMENT OF FACTS
On June 26, 2019, Blackstone submitted its City of Lansing Medical Marijuana
Application for a provisioning center (the “Application”). The City of Lansing accepted the
Application and the application fees were paid and deemed accepted by the city that same day.
The Application consisted of over 125 attachments, which provided detailed
documentation related to the proposed building, operational plans, staffing plans, security plans,
facility plans, and floor plans, among other required documents. The Application covered all
aspects of Lansing’s scoring rubric and was consistent with the Lansing ordinance.
Per the application, Blackstone submitted proof of purchase related to the proposed
property located at 6450 S. Cedar 5031 S. Cedar St., Lansing, MI 48911. Blackstone has plans to
develop and operate a licensed medical marijuana provisioning center at the proposed property.
The total capital investment to purchase the property was $1,200,000.00. Per Blackstone’s
building development plan and construction plans, the renovation needed for 6450 S. Cedar
would cost an additional $643,250.00.
Blackstone submitted detailed plans related to its staffing at the proposed provisioning
center. Per the Application submitted, Blackstone will employ between 34 to 40 employees to
work at the provisioning center. Of those employees, approximately ten (10) employees will be
in a management or leadership position.
Blackstone is also purchasing a 13,600 sq. ft. property to integrate a grower facility with
the proposed provisioning center. This grower facility will have a Class C grow license that will
allow a 1,500-plant grow operation. The property Blackstone is purchasing is commonly known
as 209 Baker Street, Lansing, MI 48910. A valid purchase agreement for the Baker property was
provided, and subsequent to the filing of the provisioning center application, Blackstone
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submitted a grow application in relation to the Baker property. The total capital investment to
purchase Baker was $1,000,000.00, and the estimated additional investment to renovate the
interior and exterior of the Baker building was $2,040,000.00.
In total, Blackstone submitted that it would create between 84 and 100 new jobs in the
City of Lansing between its proposed provisioning center and proposed medical marijuana
grower facility. The plans to staff and employ residents of Lansing would have a profound effect
on the local economy.
Despite submitting a complete and well-supported application to the City of Lansing
detailing Blackstone’s proposals, budgets, and operational plans, on September 20, 2019,
Blackstone received correspondence from the City of Lansing stating that Blackstone had not
been selected to receive a provisioning center license at the proposed location of 6450 S. Cedar.
Per the correspondence, and the attached scoring rubric, Blackstone received a score of 73.50 out
of 100. Consequently, the City of Lansing denied Blackstone the opportunity to receive
licensure, which was largely due to erroneous, arbitrary, inconsistent, and unreasonable scoring
of the Blackstone Application.
As of right, Blackstone hereby appeals the City of Lansing’s decision to deny the
Application in accordance with Chapter 1300.15(c).
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PROCEDURAL STATEMENT
At the denial of a license, an applicant:
May appeal to the city clerk, who shall appoint a hearing officer to hear and evaluate the appeal and make a recommendation to the clerk. Such appeal shall be taken by filing with the city clerk, within 14 days after notice of the action complained of has been mailed to
the applicant’s last known address on the records of the city clerk, a written statement
setting forth fully the grounds for the appeal. The clerk shall review the report and recommendation of the hearing officer and make a decision on the matter. The clerk’s decision may be further appealed to the commission if applied for in writing to the commission no later than thirty (30) days form the clerk’s decision.
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STANDARD OF REVIEW
The review of an appeal shall not be de novo. The commission shall only overturn, or
modify, a decision or finding of the clerk if it finds such decision or finding to be arbitrary or
capricious and not supported by material, substantial, and competent facts on the whole record
considered by the clerk in arriving at such decision or finding.
Arbitrary means “without adequate determining principle… fixed or arrived at through an
exercise of will or by caprice, without consideration or adjustment with reference to principles,
circumstances, or significance... decisive but unreasoned.” Capricious means “apt to change;
suddenly; freakish; whimsical; humorsome.”
Further, the applicable standard requires a review of whether the decision is supported by
competent, material, and substantial evidence on the record, and represents the reasonable
exercise of the board’s discretion. “Substantial evidence” is evidence that a reasonable person
would accept as sufficient to support a conclusion. Edw C Levy Co v. Marine City Zoning Bd of
Appeals, 293 Mich App 333, 341-42; 810 N.W.2d 621 (2011) (quoting Dowerk v. Charter Tp of
Oxford, 233 Mich App 62, 72; 592 N.W.2d 724 (1998)). Furthermore, scoring must be proper,
consistent, comply with the applicable ordinance and not be based upon an abuse of discretion.
The basis for this appeal is 1) the scoring is not based on competent, material, and
substantial evidence; 2) scoring insights provided to Blackstone are based on clearly erroneous
findings; 3) Blackstone score was based on improper/inconsistent scoring; 4) scoring methods do
not comply with the ordinance; 5) scoring insights were inconsistent with the ordinance; 6)
scoring decisions related to Blackstone application were arbitrary and capricious; and 7) scoring
was based upon an abuse of discretion. The Blackstone Application and supporting materials,
which is in the City of Lansing’s possession, is hereby fully incorporated by reference.
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ARGUMENT
I. FINANCIAL STRUCTURE & FINANCING (Section 10)
The submission criteria refers applicants to Chapter 1300.05(b)(23), which states:
An estimate of the number and type of jobs that the medical marihuana establishment is expected to create, the amount and type of compensation expected to be paid for such
jobs, and the projected annual budget and revenue of the medical marihuana establishment (emphasis added).
Blackstone was only awarded 1 out of 2 points for this scoring category. Exhibit 1 –
Scoring Rubric. The basis for the one-point deduction, per the scoring insights, was that a
“start-up budget [was] not attached.” Exhibit 1. The scorer’s determination is arbitrary and
unreasonable.
Nowhere in Chapter 1300.05(b)(23) is there a requirement to provide a “startup budget.”
Nevertheless, a startup budget and initial startup costs were included in the pro forma submitted
with the Application. See attached Exhibit 2 – Pro Forma. Per the scoring insights, the scorer
acknowledged review of the pro forma by stating: “submitted a 3-year GAAP budget with
revenue and line item expenses (“Pro Forma”).” Exhibit 2. Certainly, “startup costs” are under
the umbrella of “expenses.”
The Pro Forma clearly included specific line items for startup costs in the first year of
operation. Exhibit 2. Review of the Pro Forma demonstrates the following: 1) In year 1,
Blackstone expected initial capital investments of $1,843,250.00, which directly correlates with
both their purchase of the proposed location, as well as the documented construction costs; 2)
Blackstone identified initial startup costs for furniture and equipment in the amount of
$160,000.00; 3) Blackstone intended to have an initial spend on noise elimination and odor
elimination equipment in the total amount of $129,000.00; and 4) that wages in year 1 would
equate to $1,490,000.00. Exhibit 2. These figures clearly do not deviate from the “Tangible
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Capital Investments” described in Blackstone’s Building Construction Plan, Land Contract for
the proposed property, as well as the Building Construction quotes provided as supporting
materials to the Application. See attached Exhibit 3 – Building Construction Plan; Exhibit 4
– Land Contract re Cedar St. Property; Exhibit 5 – Building Construction Quotes; Exhibit
6 – Tangible Capital Investment Plan. These figures also equally match Blackstone’s staffing
and job creation plan.
Even a cursory look at the Pro Forma depicts the vast difference for “expenses” in the
first year (approximately $4,200,000.00) in comparison to expenses in years two and three,
which were estimated at $2,508,000.00 and $2,301,000.00, respectively. Exhibit 2. The glaring
evidence of startup costs being included in the Pro Forma should not have been ignored by the
scorer. Thus, the decision was not supported by substantial evidence or reasonable exercise of
discretion.
The Pro Forma clearly included startup costs. Exhibit 2. Thus, the scorer’s determination
that a startup budget was not attached is unreasonable. The one-point deduction is a clear error.
This Section of the scoring rubric must be reconsidered, and Blackstone should be awarded a
total of 2 out of 2 points under this category.
II. INTEGRATION WITH GROWS (Section 12) & TOTAL COL JOBS (Section 20) Zero points were awarded for Section 12 and Section 20 of the scoring rubric. Exhibit 1.
Such a score is utterly unfathomable given the numerous supporting documents provided in the
Application.
In support of Section 12 of the scoring rubric, Blackstone submitted a Plan to Integrate
with a Grower Facility. See attached Exhibit 7 – Plan to Integrate with Grow. In fact, at the
time of Application submission, Blackstone had already entered into a signed purchase
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agreement to purchase 209 Baker Street, Lansing, MI 48910. See attached Exhibit 8 –
Purchase Agreement re 209 Baker. The purchase price for the proposed grow was
$1,000,000.00. Exhibit 8. To support its plan to integrate, Blackstone included a copy of the
purchase agreement as an attachment to the Application as well as construction quotes for the
proposed grower facility. See attached Exhibit 9 – Construction Quotes for 209 Baker;
Exhibit 8. Entering into the purchase agreement for the 209 Baker property was an act in
furtherance of Blackstone’s plan to integrate with a grow. Moreover, Blackstone submitted an
application for a grower facility with the City of Lansing, which was yet another act in
furtherance of pursuing integration with a grower facility. See attached Exhibit 10 –
Application Submission Receipt. Additionally, obtaining construction quotes was another act in
furtherance of the plans to integrate. Exhibit 9. Under no circumstance, can these acts in
furtherance of moving forward with integration be deemed “speculative.”
Indeed, Blackstone has every intention of integrating a grow facility with its proposed
provisioning center. Blackstone did in fact eventually file its grow application with the City of
Lansing, which was never taken into consideration. Blackstone hereby requests that notice is
taken of Blackstone’s submitted grower application, which was filed with the City of Lansing
and is hereby fully incorporated by reference.
Moreover, the City of Lansing asked for plans of integration with a grower facility. Yet,
the scoring does not award points for having plans. Even if, assuming arguendo, that
Blackstone’s plan for integration lacked support and was merely “speculative,” then, at
minimum, Blackstone should have received points for submitting an integration plan in
accordance with the applicable ordinance. To award zero points completely undermines the
Lansing ordinance and falls completely out of the scorer’s allowable discretion. In contrast,
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applicant was awarded points for submitting “plans” in other areas of the application – for
example, Blackstone received three out of four points for their charitable plan under Section 12
of the scoring rubric. The City cannot reasonably assert that plans in one category are
“speculative,” unless they assume that mere plans, in general, are always speculative. The
disfunction in scoring only sends one message, that scoring in this category was arbitrary,
capricious, and unreasonable.
In support of Section 20 of the scoring rubric, Blackstone submitted numerous job
creation plans that outlined not only jobs at the provisioning center, but also indicated the vast
number of jobs that would be created at the proposed grow facility Blackstone plans to integrate
with at the 209 Baker Property. See attached Exhibit 11 – Job Creation Plan. Again, under the
same logic the scorer used for Section 12, see supra, the scorer awarded zero points on the basis
that the grow facility was “speculative.” Exhibit 1. However, the scorer completely ignored the
fact that plans were submitted, and also ignored the totality of jobs that Blackstone intended to
bring to the City of Lansing. As indicated in the supporting documentation, Blackstone was fully
committed to implementing its hiring and staffing plans. Exhibit 11. At the integrated grow,
Blackstone had plans to hire over 50 employees. Exhibit 11. At the provisioning center,
Blackstone had plans to hire over 35 employees. Blackstone’s Pro Forma, as well as its staffing
and job creation plans, depicted a planned budget for such hiring. Exhibit 2; Exhibit 11.
When making its determination to award zero points for the above-referenced categories,
the decision of the scorer was arbitrary and unreasonable. The scorer’s inference that the grow
facilities were “speculative” is without basis. The supporting documentation certainly indicates
that Blackstone fully intends to integrate with a grow facility and that it took steps towards
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accomplishing that plan. As such, these scores must be reconsidered and Blackstone should be
awarded, at minimum, 7 out of the 10 points available under these categories.
III. PROJECTED ANNUAL BUDGET (Section 19)
The scorer acknowledges, in the scoring insights section, that applicant included a “3-
year budget with revenue and line item expenses,” and then goes on to state that “no startup
budget attached.” This assertion is wrong. A start-up budget was incorporated into the Pro
Forma, which was acknowledged by the scorer. Exhibit 2. The Pro Forma clearly included
specific line items for startup costs in the first year of operation. For instance, the Pro Forma
indicates $1,843,250.00 allocated for “Capital Investments” in year 1. These figures clearly do
not deviate from the “Tangible Capital Investments” described in Blackstone’s Building
Construction Plan, as well as the Building Construction quotes provided as supporting materials
to the Application. Exhibit 6.
Additionally, the Pro Forma included line items for other startup costs such as “Noise
Elimination Equipment” and “Odor Elimination Equipment,” which were expenses to be
absorbed only within the first year of operation. Exhibit 2. Certainly, “start-up costs” are under
the umbrella of “expenses.” Even a cursory look at the Pro Forma depicts the vast difference for
“expenses” in the first year (approximately $4,200,000.00) in comparison to expenses in years
two and three, which collectively total less than $5,000,000.00. Exhibit 2. The glaring evidence
of startup costs being included in the Pro Forma cannot be ignored. Thus, the scorer’s
determination that a startup budget was not attached is unreasonable.
IV. NET WORTH (Section 22)
Blackstone was not awarded any of the three possible points in this scoring category.
Exhibit 1. The basis for the entire three-point deduction, per the scoring insights, was that
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Blackstone “Doesn’t have $100K in a bank account in the applicant’s name. Doesn’t have solid
proof of net worth. No submitted document in name of applicant. Doesn’t have full
documentation of initial start-up and operating costs.” Exhibit 1. The scorer’s determination is
unreasonable.
The submission criterion for this scoring category refers applicants to section
1300.05(b)(12)(vii) and 1300.06(b)(5) which respectively state:
(12) A copy of the proposed business plan for the establishment, including, but not
limited to, the following: (vii)Financial structure and financing of the proposed medical marihuana establishment(s)
See Chapter 1300.05(b)(12)(vii).
* * * (5) Whether the applicant has reasonably and tangibly demonstrated it possesses
sufficient financial resources to fund, and the requisite business experience to execute,
the submitted business plan and other plans required by Section 1300.05. The maximum number of scoring points in this category shall be ten points. See Chapter 1300.06(b)(5).
Blackstone’s sole owner, Joann Steil, provided a detailed personal financial statement
from her CPA indicating a net worth of nearly $1,400,000.00, with available cash in excess of
$750,000.00. See attached Exhibit 12 – CPA Attested Financials. Ms. Steil is 100% owner of
Blackstone (a flow-thru entity), meaning that Ms. Steil and the entity are one and the same. See
attached Exhibit 13 – Ownership Structure; Exhibit 14 – Operating Agreement.
Additionally, Ms. Steil demonstrated that over $100,000.00 of liquid capital was
immediately available for capital contribution to Blackstone. See attached Exhibit 15 – Bank
Statements and Deeds; See attached Exhibit 16 – Financial Cover Page. Ms. Steil provided
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detailed bank statements demonstrating there was sufficient cash at her disposal for contribution
to Blackstone. Exhibit 15. As such, point reductions in this category are unjustified.
The scorer deducted points claiming that there wasn’t solid proof of net worth despite the
fact that Ms. Steil’s CPA attestation specifically provided the necessary assurances, wherein the
CPA stated, “our responsibility is to conduct this engagement in accordance with Statements on
Standards for Attestation Engagements (SSAE)… We believe that the results of these procedures
provide a reasonable basis of our conclusion.” Exhibit 12. The CPA attested financials also state
that “based on the agreed upon procedures performed, we declare to the best of our knowledge,
the statement of financial condition of Joann Steil is complete and accurate.” Exhibit 12. The
decision to award 0 points is vastly unreasonable given Ms. Steil’s net worth and the supporting
documentation demonstrating that the entity was well capitalized.
Additionally, Blackstone provided Lansing with numerous supporting documents to
further provide assurance of its finances. The supporting materials included, bank statements,
annuity accounts and real estate deeds. Exhibit 15. The conclusions and decisions derived by the
score are arbitrary and unreasonable and are inconsistent with the supporting materials provided,
which if viewed reasonably, would have qualified Blackstone to receive all points under this
category.
Chapter 1300.06(b)(5) states that the City, as part of its scoring process, should consider
“whether the applicant has reasonably and tangibly demonstrated it possesses sufficient financial
resources…” The key word in this section of the ordinance is reasonably. It would be
completely unreasonable for the City to deduct points from Blackstone after its inclusion of the
numerous documents that corroborated Ms. Steil’s net worth and access to capital. This is in
addition to Ms. Steil signing a sworn statement as to the truth of this documentation and placing
32
her reputation, other business licenses, and livelihood at stake by doing so. See attached Exhibit
17 – Sworn Statement. Any objective person would find the documentation submitted by Ms.
Steil to be reasonable and that she did provide assurances of her financial ability and business
experience to operate this business.
In addition to the above, the scorer indicates that applicant failed to include a start-up
budget. This assertion is wrong. A start-up budget was included in the Pro Forma submitted
with the Application. Exhibit 2. Applicant included a 3-year Pro Forma which clearly included
a specific line items for startup costs in the first year of operation. For instance, the Pro Forma
indicates $1,843,250.00 allocated for “Capital Investments” in year 1. These figures clearly do
not deviate from the “Tangible Capital Investments” described in Blackstone’s Building
Construction Plan, as well as the Building Construction quotes provided as supporting materials
to the Application. Exhibit 6.
Additionally, the Pro Forma included line items for startup costs such as “Noise
Elimination Equipment” and “Odor Elimination Equipment,” which were expenses to be
absorbed only within the first year of operation. Exhibit 2. Certainly, “start-up costs” are under
the umbrella of “expenses.” Even a cursory look at the Pro Forma depicts the vast difference for
“expenses” in the first year (approximately $4,200,000.00) in comparison to expenses in years
two and three, which collectively total less than $5,000,000.00. The glaring evidence of startup
costs being included in the Pro Forma cannot be ignored. Thus, the scorer’s determination that a
startup budget was not attached is unreasonable.
Given that Blackstone clearly showed readily available funds in excess of $100,000, with
solid proof of net worth and clear evidence of start-up costs, the scorer’s decisions were made in
33
error, or were unjustified and unreasonable. In either event, Applicant must be awarded all
possible points in this category.
V. ODOR PLAN (Section 35) The submission criteria for this category refers applicants to Chapter 1300.06(b)(3) and
Chapter 1300.09(i). Chapter 1300.06(b)(3) states:
Planned outreach on behalf of the proposed establishment, and whether the applicant or its stakeholders have made, or plan to make, significant physical improvements to the
building housing the medical marihuana establishment, including plans to eliminate or
minimize traffic, noise, and odor effects on the surrounding neighborhood. The maximum number of scoring points in this category shall be ten point
Chapter 1300.09(i) states:
No medical marihuana provisioning center shall be operated in a manner creating noise,
dust, vibration, glare, fumes, or odors detectable to normal senses beyond the boundaries of the property on which the medical marihuana provisioning center is operated; or any other nuisance that hinders the public health, safety and welfare of the residents of the City.
Applicant was only awarded 3 of 4 points in this category, despite including a detailed
Odor Mitigation Plan. See attached Exhibit 18 – Odor Plan. The scorer, per the scoring
insights, based their decision on an unreasonable conclusion that the Odor Plan submitted did not
include “specs, or budget.” Exhibit 1. To the contrary, the Odor Plan submitted by Blackstone
included detailed equipment specs. Exhibit 18. Moreover, the Pro Forma submitted by
Blackstone clearly indicated a line item for Odor Equipment in the amount of $104,000.00.
Exhibit 2.
In addition, prior to submission of applications, the Clerk’s office provided applicants,
via the City’s website, a scoring rubric scoring guide with specific items to include to obtain
maximum points. See attached Exhibit 19 – Sample Rubric. In Section 35, “Plan to
Minimize/Eliminate Odor,” the criteria column states, “Any plan(s) the applicant has provided
which would minimize or eliminate the impact of increased odor on nearby neighborhoods
34
please document in budget of expenditures.” Here, Blackstone followed these instructions
precisely as requested and did, in fact, document the odor equipment cost in the budget of
expenditures, which is clearly listed as a separate line item in year 1 of the previously attached
Pro Forma. Exhibit 2. Adversely, the scorer deducted a point because the Odor Plan did not
include the cost of the equipment being proposed. Exhibit 1. However, the instructions clearly
stated to document said cost directly into the budget of expenditures, which applicant did based
upon a plain reading of the Lansing City Ordinance and other City materials. Exhibit 18.
The scorer also indicates that there were “no specs” provided for the odor equipment
being proposed. Exhibit 1. However, the attached Odor Plan, which was included as part of
Applicant’s application submission, includes specific details about the type of equipment to be
used. Exhibit 18. Specifically, Applicant’s Odor Plan provides a detailed description of the
equipment that will be used, including the type of system (mini-split), type of drive (belt),
amount of carbon (30 lbs), additional equipment (ozone generator), type of odor measuring
equipment (differential pressure gauge & Olfactometer), and type of comparative scale of
reference (OIRS - Odor Intensity Reference Scale). The main points of the Odor Plan have been
included here for your reference:
• The space will be conditioned using multiple split heat pump systems of various
capacities and a ductless mini-split system. Each of the split-systems, excluding the ductless mini-split system, are equipped with unit-level pleated filters.
• An in-line, belt driven exhaust fan is provided to remove the amount of fresh air provided
for the occupants and an additional amount that will ensure a negative pressure within the
space.
• The in-line exhaust fan is equipped with a filter section loaded with approximately thirty pounds of activated carbon, in a rack-mounted configuration.
• An ozone generator will be placed upstream of the carbon filters, in the housing assembly.
35
• A differential pressure gauge will be used to ensure a negative building static of no less than .05” of negative building static has been achieved. A maximum negative building
static shall not exceed .15”
• Testing shall be done using a field Olfactometer, calibrated in accordance with odor control standards using the scheduled monitoring protocol.
• We will compile and compare the data we record to establish norms using a 5-point Odor
Intensity Reference Scale to compare daily readings. The scorer’s determination that Applicant provided neither a budgeted cost nor any
specifics on the type of equipment proposed for this location cannot be possibly derived from the
materials submitted. Thus, the scorer’s decision should be deemed arbitrary and
unreasonable. Applicant clearly provided both aforementioned items with adequate sufficiency
and, as such, must be awarded one (1) additional point in this category.
CONCLUSION AND REQUESTED RELIEF
The scored rubric which applicant received with its denial is riddled with clear and
obvious errors and in some cases, direct contradictions made by the scorer.
It is also clear that the City of Lansing has decided to deduct points arbitrarily and
capriciously. As referenced above, many of the deductions were non-objective, unreasonable,
and without basis under the requirements set forth in the City of Lansing’s applicable ordinances.
These numerous errors and blatant disregard for the requirements set forth in the ordinance
bolster Applicant’s claims that the scoring was arbitrary and capricious; and was not supported
by material, substantial, and competent facts on the whole record considered by the Clerk.
Applicant maintains that the entire application needs to be re-scored with the additional points
outlined above being added to Blackstone’s score.
Blackstone hereby reserves all rights. Additionally, the Exhibits attached hereto are not
meant to replace the application, or the totality of documents submitted in support of each
36
category of scoring. Blackstone hereby incorporates its entire Application, as well as its grower
application fully by reference herein.
Respectfully submitted,
/s/ Nadeem Noah Harfouch /s/ Mike M. Bahoura
Nadeem Noah Harfouch, Esq. Mike M. Bahoura, Esq. The Harfouch Law Firm, PLLC Law Offices of Mike M. Bahoura, PLLC 631 East Big Beaver Road, Suite 211 631 East Big Beaver Road, Suite 211 Troy, MI 48083 Troy, MI 48083
Ph: 248-274-6529 Ph: 248-392-1586
nharfouch@harfouchlaw.com mike@bahouralaw.com Dated: October 2, 2019 Dated: October 2, 2019
37
EXHIBIT
1
Scoring Rubric, as scored by the Clerk
38
City of Lansing Provisioning Center Ranking 9/20/2019 3:51 PM
Total
Possible
Points
Blackstone Harvest LLC ‐ District Club‐6450 S. Cedar
Applicant Address ‐‐‐
#Category ‐‐‐Score Location of material Scoring Insights
1 Ownership Structure 1 1 Org Docs, Ownership Struc., 1 pg.Has structure. 8/12/19
2 Organizational Chart 1 1 Org Docs, Org Chart, 6 pgs.Has org chart. 8/12/19
3 Worker Training Program 1 1 OtherReqDocs, Worker Training Plan, 95 pgs.Has plan. 8/12/19
4 Short and Long Term Goals and
Objectives 1 1 Org Docs, Goals, 71 pgs.Has goals. 8/12/19
5 Community Outreach &
Education 1 1 Community Outreach, Outreach&Ed, 7 pgs. Has plan. 8/12/19
6 Marketing, Advertising &
Promotion 3 3 Marketing Five examples of minor minimization with good detail. Includes marketing materials. Includes
budget. 7/9/19
7 Tangible Capital Investment
Dollar Amount 5 5 4 page Investment Plan in TCI section Calculated $4,883,250 TCI from narrative. 8/12/19
8 Tangible Capital Investment
Own/Lease 3 3 19 pages in Lease with Permission in TCI Folder Stakeholder owns the property. 8/12/19
9 Tangible Capital Investment
Supporting Material 3 3 47 pages in TCI Supporting Documents Has supporting materials which fully corroborate stated/calculated TCI. 8/12/19
10 Financial Structure & Financing 2 1 Job Creation, Budget Revenue 1 page and Finance, Startup Costs
Budget 1 page 3 year budget with revenue and line item expenses. No startup budget attached. 8/21/19
11 LARA Pre‐Qual 3 3 demo of reg prequalification Received prequalification letter dated 7/18/19 for Blackstone Harvest, LLC. 8/12/19
12 Integration with Grows 4 0 Integration
Integration Plan
Integration plan says they will have grow, but does not have any application(s) submitted. Deemed
speculative. 9/20/19
13 Charitable Plans & Strategies 4 3 Charitable
Charitable Plan Plans to contribute $125K in cash and $10K in volunteer time. No receipts or agreements. 8/12/19
14 Number of and job
descriptions for PC ONLY 3 3 Job Creation
FTE's 34‐40 FTE's at PC. Job descriptions with adequate detail. 8/12/19
15 Healthcare 2 2 Job Creation
Healthcare Employer will provide healthcare. 8/12/19
16 Paid Time Off 1 1 Job Creation
Healthcare Employer will provide paid time off. 9/12/19
17 Retirement 1 1 Job Creation
Healthcare Employer will provide 401K or similar plan. 8/12/19
18 % of employees at $15+/hr 3 3 Job Creation
Plus 15 100% of employees will make $15+/hr. 8/12/19
19 Projected Annual Budget 2 1 Job Creation, Budget Revenue 1 page and Finance, Startup Costs
Budget 1 page 3 year budget with revenue and line item expenses. No startup budget attached. 8/21/19
20 Total COL Jobs 6 0 Job Creation
Lansing Jobs Has not submitted application for grow, therefore jobs are speculative 9/16/19
Total Business Plan &
Job Creation 50 37
21 Financial Litigation History 1 1 Financial Litigation History Form Financial Litigation History Form submitted on sole stakeholder. 7/10/19
22 Net Worth 3 0 6 pages in Financial Section of Laserfiche
Doesn’t have $100K in a bank account in the applicant’s name.
Doesn’t have solid proof of net worth. No submitted document in name of applicant. 9/16/19
Doesn’t have full documentation of initial start‐up and operating costs. 9/12/19
23 LARA Pre‐Qual 3 3 demo of reg prequalification Received prequalification letter dated 7/18/19 for Blackstone Harvest, LLC. 8/12/19
24 Stakeholder Experience
City of Lansing Businesses 1 0 Experience Stakeholder Resume Resume does not list any Lansing business ownership. 7/12/19
25 Stakeholder Experience
Relevant Businesses 1 1 Experience Stakeholder Resume Sole stakeholder has 18 years experience in a medical related field. 7/12/19
26 Stakeholder Experience
Medical Marijuana Business 1 0 Experience Stakeholder Resume Sole stakeholder did not list any medical marijuana related experience. 7/12/19
Total Financial Stability
&
Business Experience
10 5
27
Impact on Neighborhood
Distance Between PC &
Residential Zoning
7 5
https://lansing.maps.arcgis.com/apps/webappviewe
r/index.html?id=be0634345255438ba55b14c9b19e9f
22
PC has residential zoned property within 1/4 mile. 9/20/19
139
City of Lansing Provisioning Center Ranking 9/20/2019 3:51 PM
28 Impact on Neighborhood
Density of PCs 7 1.5
https://lansing.maps.arcgis.com/apps/webappviewe
r/index.html?id=be0634345255438ba55b14c9b19e9f
22
Lose 2 points for every existing PC within a 1/2 mile radius. None
Lose 1 point for every existing PC within a 1 mile radius. #5, #9, #10, #11, #13
Lose .5 point for every existing PC within a 1.5 mile radius.#2
Lose .25 point for every existing PC within a 2 mile radius. None
Lost 5.5 points. 8/12/19
29 Traffic & Parking 3 3 Public Service Review Tier 1 plan. Excellent parking/circulation. 8/30/19
30 Security Plan 3 3 LPD Review Tier I ‐ bank vault, on site guard, alarm system w/ color printer, panic button, off site video storage,
Man trap barrier, equipment specs 8/20/19
Total ‐ Land Use &
Resident Safety 20 12.50
31 Planned Outreach 1 1 Community Outreach, Outreach&Ed, 7 pgs. Has plan. 8/12/19
32 Improvements to Building 3 3 Building Improvements
Support Docs
SEV‐$280,600
Proposed Improvements $643,250.00 ‐ 229% of SEV
Has proposal from ZA Design Build which supports that amount. 8/26/19
33 Plan to Minimize Traffic 1 1 Traffic Study, Neighborhood Compatibility & Plans to minimize
traffic 10pgs total Has a plan. 9/12/19
34 Noise Plan 1 1 Noise & Odor
Noise Plan Has plan. 8/12/19
35 Odor Plan 4 3 Noise & Odor
Odor Plan, Odor Plan, 2 pages Has detailed plan, but no specs or budget. 8/12/19
Total Outreach 10 9
36 Stakeholder History
Proof of LARA Prequal 2 2 demo of reg prequalification Received prequalification letter dated 7/18/19 for Blackstone Harvest, LLC. 8/12/19
37 Demo of Regulatory
Compliance 5 5
https://bsaonline.com/SiteSearch/SiteSearchDetails?SearchFocus
=All+Records&SearchCategory=Address&SearchText=6450+s+ced
ar&uid=384&PageIndex=1&ReferenceKey=33‐01‐05‐10‐151‐
012&ReferenceType=0&SortBy=&SearchOrigin=0&RecordKeyDis
playString=33‐01‐05‐10‐151‐012&RecordKey=1%3d33‐01‐05‐10‐
151‐012%3a%3a4%3d33‐01‐05‐10‐151‐
012%3a%3a7%3d55b67cb1‐daee‐40e6‐9dae‐
9f2801426ce9%3a%3a13%3d4975&RecordKeyType=1%3d0%3a%
3a4%3d0%3a%3a7%3d2%3a%3a13%3d1
No code violations, no conditional denial letters. 9/12/19
38 Morals, Good Order & General
Welfare Litigation History 3 3 Morals Lit Hist Demo of Reg Has completed form(s) for all stakeholder(s). 9/12/19
Total Applicant
Stakeholder History 10 10
Total Score 100 73.50
240
EXHIBIT
2
Pro Forma/Budget
41
BLACKSTONE HARVEST, LLC - PRO FORMA YEAR 1 YEAR 2 YEAR 3
Sales $9,000,000 $10,500,000 12,000,000
Costs of Goods Sold/Inventory $2,640,000 $2,900,000 $3,215,000
GROSS PROFIT $6,360,000 $7,600,000 $8,785,000
OPERATING EXPENSES
Salary and Wages $1,490,000 $1,550,000 $1,575,000
Employee Benefits and Bonuses $150,000 $160,000 $170,000
Capital Investments $1,843,250 $300,000 0
Outside Services $35,000 $35,000 $35,000
Supplies/Furniture/Equipment (Office & Operation) $160,000 $50,000 $70,000
Repairs & Maintenance $23,000 $38,000 $41,000
Noise Elimination Equipment $25,000 $0 $0
Odor Elimination Equipment $104,000 $0 $0
Marketing & Advertising $58,000 $36,000 $42,000
Car & Travel & Vehicle Misc. $50,000 $55,000 $57,000
Accounting $24,000 $25,000 $26,000
Legal $36,000 $36,000 $36,000
Telephone $10,000 $10,000 $10,000
Utilities $19,000 $19,000 $20,000
Insurance & Workers Comp $10,000 $10,000 $10,000
Security Monitoring $16,000 $16,000 $16,000
General Admin $3,000 $3,000 $3,000
Patient Education $20,000 $20,000 $20,000
Community Spending and Charity $130,000 $145,000 $170,000
TOTAL EXPENSES $4,206,250 $2,508,000 $2,301,000
NET INCOME BEFORE INTEREST TAX DEPRECIATION AND AMORTIZATION $2,153,750 $5,092,000 $6,484,000
42
EXHIBIT
7
Plan to Integrate
43
Blackstone Harvest, LLC – Plan to Integrate with a Grower Facility
Blackstone Harvest, LLC (“Blackstone Harvest”) will integrate the provisioning center with a medical marijuana grower facility in the City of Lansing. Blackstone Harvest has a signed purchase agreement for the property commonly known as 209 Baker Street, Lansing, Michigan 48910. Blackstone Harvest will be purchasing the property for $1,000,000.00. The property is
approximately 13,600 square feet and is situated on approximately 2.47 acres of land. Blackstone
Harvest will file an application to operate a licensed medical marijuana grower facility at the property. Blackstone Harvest will grow 1,000 plants or more at the proposed facility. Blackstone Harvest’s application for the proposed grower facility will include separate business and operational plans, as well as other relevant information, in accordance with the City of Lansing’s Code of Ordinances.
44
10/2/2019 City of Lansing Clerk,MI-Online Payments
https://client.pointandpay.net/web/cityoflansingclerkmi 1/1
Step 1: Select Payments Step 2: Review and Submit Step 3: Confirmation and Receipt
Step 3: Confirmation and Receipt
Result: Payment Authorized
Confirmation Number: 64893086
Your payment has been authorized successfully and payment will be processed.
The City of Lansing Clerk thanks you for your payment. For questions about your account, please call 517-483-4131. Credit card payments will show up as City of Lansing Clerk. E-check
payments will show up as PNP BILLPAYMENT 8888916064 Thank you for using our bill payment services.
Please save or print a copy of this receipt for record keeping purposes.
My Bills
Description Amount
MJ Facilities License payment of $5,000.00 on Submission Number 10787 $5,000.00
Customer Information
First Name: Joann
Last Name: Steil
Address Line 1: 22618 Shorewood Dr
Address Line 2:
City:St Clair Shores
State: Michigan
Zip Code: 48081
Phone Number: 5867031702
Email Address: jsteil902@gmail.com
Subtotal:$5,000.00
Convenience Fee: $150.00
Total Payment:$5,150.00
Payment Information
Payment Date: 10/02/2019
Card Type: Visa
Card Number: ************5774
Print
45
46
47
EXHIBIT
10
Receipt for Grow Application
48
10/2/2019 City of Lansing Clerk,MI-Online Payments
https://client.pointandpay.net/web/cityoflansingclerkmi 1/1
Step 1: Select Payments Step 2: Review and Submit Step 3: Confirmation and Receipt
Step 3: Confirmation and Receipt
Result: Payment Authorized
Confirmation Number: 64893086
Your payment has been authorized successfully and payment will be processed.
The City of Lansing Clerk thanks you for your payment. For questions about your account, please call 517-483-4131. Credit card payments will show up as City of Lansing Clerk. E-check
payments will show up as PNP BILLPAYMENT 8888916064 Thank you for using our bill payment services.
Please save or print a copy of this receipt for record keeping purposes.
My Bills
Description Amount
MJ Facilities License payment of $5,000.00 on Submission Number 10787 $5,000.00
Customer Information
First Name: Joann
Last Name: Steil
Address Line 1: 22618 Shorewood Dr
Address Line 2:
City:St Clair Shores
State: Michigan
Zip Code: 48081
Phone Number: 5867031702
Email Address: jsteil902@gmail.com
Subtotal:$5,000.00
Convenience Fee: $150.00
Total Payment:$5,150.00
Payment Information
Payment Date: 10/02/2019
Card Type: Visa
Card Number: ************5774
Print
49
EXHIBIT
11
Job Creation Plan
50
Blackstone Harvest, LLC – Job Creation – Additional Lansing Jobs
Investment in 209 Baker Street, Lansing, MI 48910:
The Company is also purchasing a 13,600 sq. ft. property to integrate a grower facility with the
proposed provisioning center. This grower facility will have a Class C grow license that will
allow a 1,500-plant grow operation. The property we are purchasing is commonly known as 209 Baker Street, Lansing, MI 48910. The total capital investment to purchase the property will be $1,000,000.00. We project that this building will require an additional investment of $2,040,000.00 to renovate the interior and exterior of the building for purposes of a medical marijuana grower facility.
Job Creation at 209 Baker Street, Lansing, MI 48910:
We will employ approximately 50 to 60 employees to work at the grower facility.
Job Creation Effects on Economy of Lansing:
The total jobs added in Lansing will be between 50 to 60 new jobs. This will have a profound effect on the local economy, especially since our Company will seek to hire locally.
Our Company will provide a living wage that is at least 200% above the Federal Poverty Level for a family of two (2). All of our employees will be paid more than $15.00/hr. in wages and will be eligible for Company paid health insurance, as well as benefits. Our benefits will include, but are not limited to, paid vacation time off, paid personal time off, employee retirement savings
plans, which will include employer contributions, and an employer paid health insurance
package, among other things. Our Company also seeks to increase the number and diversity of job opportunities for residents in the City of Lansing and its surrounding community. We’re confident that our presence in the City will improve the standard of living and quality of life for many individuals by increasing
and improving the job opportunities available. We will build resources that support environmental protection, education, and cultural and social growth. Our educational programs and training will lead to a knowledgeable staff who will possess skillsets that will translate to opportunities for career growth and development.
Employer Covered Group Health Insurance Plan:
Our employees will receive health benefits. We will find a plan that best meets our needs and give employees the option to enroll in our group health insurance plan. Health insurance will be fully covered by our Company.
51
Employee Benefits:
Our Company will provide employees with a variety of benefits for working with us. We want the best candidates and we will incentivize employees for staying with us by offering long-term benefits. After the first six months of employment, employees will be eligible for a week of paid vacation time off and three (3) days of personal time off. After
the first three (3) years of employment with our Company, employees will have two
weeks of paid vacation time off, and four (4) days of personal time off. Additionally, we will work with a nationally recognized service provider, such as Merrill Lynch, to adopt a retirement and benefits package for our employees to enroll in. Any employee that puts money towards their employee retirement account will receive a
Company match of up to 3% of the employee’s yearly income.
Employee Bonuses:
Our Company will offer bonuses to employees based on their performance and continued training. Bonuses will be discretionary and will be paid on a yearly basis after Q4.
Hiring Local:
Our Company will use its best efforts to employ City of Lansing residents. We will use existing City resources, and/or online recruitment services, to help us in the endeavor of receiving an abundance of employment applications from City residents. Our goal is to develop and maintain a dynamic partnership with City residents so that our Registered
Patients can see familiar faces at our facility.
Employing the Chronically Underemployed: We want to give the chronically underemployed new opportunities in this new and
fascinating industry. Our commitment to hire locally will also be matched with our commitment to hire the chronically underemployed. We will work to find individuals who have unexpectedly lost their jobs or are experiencing a significant drop in work hours. We will connect with the Michigan Unemployment Insurance Agency and use the
Pure Michigan Talent Connect database to hire underemployed Michigan citizens.
Job Creation – Jobs and Compensation at Grower Facility:
Position Number of
Employees
Designation Compensation
Horticulturists 22 8 Full-Time - Hourly 14 Part-Time – Hourly
$17.00/hr.
52
Packaging Team Member 4 1 Full-Time - Hourly 3 Part-Time – Hourly
$17.00/hr.
Tissue Culture Technician 1 Full-Time – Salary $60,000.00/year
Director of Quality Assurance 1 Full-Time – Salary $60,000.00/year
Director of Cultivation 1 Full-Time – Salary $150,000.00/year
Inventory Manager 1 Full-Time – Salary $55,000.00/year
Cultivation and Quality Assurance Techs 8 2 Full-Time – Hourly 6 Part-Time - Hourly
$16.00/hr.
Packaging Manager 1 Full-Time – Salary $60,000.00/year
General Manager 1 Full-Time – Salary $75,000.00/year
Assistant Manager(s) 2 Full-Time – Salary $50,000.00/year
Account Manager 1 Full-Time – Salary $55,000.00/year
Master Grower(s) 2 Full-Time – Salary $150,000.00/year
Compliance Director 1 Full-Time –
Salary
$55,000.00/year
Maintenance Manager 1 Full-Time -
Hourly
$16.00/hr.
Security Manager 1 Full-Time – Salary $55,000.00/year
Receptionist/Admin 1 1 Full-Time Hourly $18.00/hr.
Security Officer(s) 3 1 Full-Time Hourly 2 Part-Time
Hourly
$16.00/hr.
Community Outreach
Manager
1 Full-Time
Hourly
$18.00/hr.
Information Technology
Specialist(s)
1 Full-Time
Hourly
$18.00/hr.
53
Blackstone Harvest, LLC – Employee Compensation and Jobs Available
Our Company will provide a living wage that is at least 200% above the Federal Poverty Level for a family of two (2). All of our employees will receive above $15.00/hr. in wages and will be eligible for Company paid health insurance, as well as benefits. Our benefits will include, but are not limited to, paid vacation time off, paid personal time off, employee retirement savings plans,
which will include employer contributions, and an employer paid health insurance package,
among other things.
Investment in 6450 S. Cedar St., Lansing, MI 48911:
Blackstone Harvest, LLC (the “Company”) is purchasing the property commonly known as 6450
S. Cedar St., Lansing, Michigan 48911 for the purpose of developing and operating a licensed medical marijuana provisioning center. The total capital investment to purchase the property will be $1,200,000.00. Per our building development plan and construction plans, the renovation needed for the building will cost an additional $643,250.00.
Job Creation at 6450 S. Cedar St., Lansing, MI 48911: We will employ between 34 to 40 employees to work at the provisioning center. Of those employees, approximately ten (10) employees will be in a management or leadership position.
Job Creation Effects on Economy of Lansing:
The total jobs added in Lansing exclusively from our provisioning center will be between 34 and 40 new jobs. This will have a profound effect on the local economy, especially since our
Company will seek to hire locally.
Our Company also seeks to increase the number and diversity of job opportunities for residents in the City of Lansing and its surrounding community. We’re confident that our presence in the City will improve the standard of living and quality of life for many individuals by increasing and improving the job opportunities available. We will build resources that support
environmental protection, education, and cultural and social growth. Our educational programs and training will lead to a knowledgeable staff who will possess skillsets that will translate to opportunities for career growth and development.
Hiring Local:
Our Company will use its best efforts to employ City of Lansing residents. We will use existing City resources, and/or online recruitment services, to help us in the endeavor of receiving an abundance of employment applications from City residents. Our goal is to develop and maintain a dynamic partnership with City residents so that our Registered
Patients can see familiar faces at our facility.
54
Employing the Chronically Underemployed:
We want to give the chronically underemployed new opportunities in this new and fascinating industry. Our commitment to hire locally will also be matched with our commitment to hire the chronically underemployed. We will work to find individuals who have unexpectedly lost their jobs or are experiencing a significant drop in work
hours. We will connect with the Michigan Unemployment Insurance Agency and use the
Pure Michigan Talent Connect database to hire underemployed Michigan citizens.
Executive Salary Compensation:
Position Number of
Employees
Designation Compensation
CEO 1 Full-Time – Salary $130,000.00/year
CFO 1 Full-Time – Salary $90,000.00/year
COO 1 Full-Time – Salary $90,000.00/year General Counsel 1 Full-Time - Salary $90,000.00/year
Full-Time/Part-Time Staff Compensation:
Position Number of
Employees
Designation Compensation
Compliance Manager 1 Full-Time – Salary $45,000.00/year
Human Resources Manager 1 Full-Time –
Salary
$45,000.00/year
Accountant/Bookkeeper 1 Full-Time –
Salary
$50,000.00/year
Product Pricing Specialist 1 Full-Time –
Salary
$40,000.00/year
Financial Analyst 1 Full-Time – Salary $45,000.00/year
Security Manager 1 Full-Time – Salary $45,000.00/year
General Manager 1 Full-Time – Salary $65,000.00/year
Assistant Manager(s) 1 Full-Time – Salary $45,000.00/year
Account Manager 1 Full-Time – Salary $40,000.00/year
Patient Care Specialist(s) 8 4 Full-Time Hourly 4 Part-Time Hourly
$16.00/hr.
Provisioning Center Technician(s) 8 4 Full-Time Hourly $16.00/hr.
55
4 Part-Time Hourly
Maintenance Manager 1 Part-Time
Hourly
$16.00/hr.
Inventory Coordinator(s) 1 Full-Time
Hourly
$18.00/hr.
Receptionist(s) 3 1 Full-Time
Hourly 2 Part-Time Hourly
$16.00/hr.
Security Officer(s) 4 1 Full-Time Hourly 3 Part-Time Hourly
$16.00/hr.
Community Outreach Manager 1 Full-Time Hourly $18.00/hr.
Information Technology Specialist(s) 1 Full-Time Hourly $18.00/hr.
Organizational Job Descriptions
Chief Executive Officer/President (CEO)
The CEO is responsible for all facets of the operation, including financial oversight. The CEO is the leader of the
management team with responsibility for managing all senior managers. The CEO will have significant interaction
with the principals/owners of the Company and all outside groups including state regulators, local government
officials, and community groups. The CEO develops policy and communicates expectations and the Company’s
mission.
Chief Financial Officer (CFO)
The CFO is responsible for direction and oversight of the financial functions of the Company, in accordance with
U.S. generally accepted accounting principles and in accordance with MMFLA rules and regulations. The CFO
oversees accounting controls and procedures concerning the collection, verification, and analysis of financial
information.
56
Chief Operations Officer (COO)
The COO is responsible for carrying out our Company’s strategic plan through overseeing operations, developing
functional roles and assigning responsibilities to employees. The COO is responsible for overseeing the inventory
control system which includes day-to-day operations of dispensing, packaging, administrative offices and inventory
control.
General Counsel
The General Counsel is responsible for offering counsel on a variety of legal issues, advising Company executives,
and ensuring compliance with legal requirements.
Financial Analyst
The Financial Analyst is responsible for financial planning, analysis, and projection for the Company. The Financial
Analyst identifies trends and makes recommendations concerning system improvements.
Product Pricing Specialist
The Product Pricing Specialist implements pricing strategies that meet the Company’s standards, policies and
procedures.
Accountant/Bookkeeper
The Bookkeeper is responsibility for daily accounting duties. The Bookkeeper will cooperate with the Company’s
outside accounting firm and Inventory Coordinator to complete regular audits of the system.
Human Resource Manager
The HRM oversees policies, procedures and compliance relating to Company employees. Further, HRM ensures all
human resources activities are in compliance with local, state and federal laws; and implements and oversees
programs related to employee benefits and initiatives. Employee benefits are overseen by the HRM as well. The
HRM makes recommendations on potential policy changes to ensure the Company offers a healthy package of
57
salary and benefits to employees. The HRM ensures the workplace is accommodating and free of harassment,
handling complaints in accordance with policy and any relevant laws.
Compliance Manager
The Compliance Manager is responsible for upholding the Michigan Medical Marihuana Program guiding principles
as well as overall Company compliance. The Compliance Manager will be responsible for communicating with the
Department to schedule inspections, reviewing policies and procedures and updating on a quarterly basis as well
as educating the Company’s employees on compliance and regulations. The Compliance Manager will also assist
the inventory coordinator with quality control and ensure all products are tested, labeled, and packaged properly.
Security Manager/Officers
The dispensary will employ a Security Manager and Security Officers to oversee the safety of staff and the security
of the facility. The Security Manager is responsible for all security of the facility and its perimeter, and will train all
staff as to basic security protocols. The Security Manager is also responsible for the security and safety of the
immediate environment outside of the facility perimeter to the extent that the provisioning center’s operations
relate to the welfare of the neighbors, arising from the facility’s presence in the neighborhood. The Security
Manager will maintain strict vigilance for diversion and deviation of medicine.
Information Technology Specialist
The IT Specialist is responsible for the implementation of the Company’s computer systems. The IT Specialist will
also be responsible for systems-related staff training, as well as integrity of the information and security of the
systems including physical and as electronic security.
Community Outreach Manager
The Community Outreach Manager will oversee the planning and implementation of outreach strategies. The
Community Outreach Manager is primarily responsible for connecting people in the broader community and
cultivating relationships with businesses, individuals, and other relevant organizations.
58
Maintenance Manager
The Maintenance Manager is responsible for planning, organizing and managing preventive maintenance, cleaning,
and repairs to equipment, fixtures, furnishings and the structure.
General Manager
The General Manager’s responsibility is to oversee all day-to-day operations of the Company including sales,
money inventory, storage of medical marihuana Products, cleanliness and organization, and signage. The General
Manager will also be responsible for ensuring that all operations are compliant with state and local law, and that
all appropriate steps are being taken to mitigate exposure under Federal law.
Account Manager
The Account Manager serves as lead point of contact for all account management matters, and completes
administrative work as required.
Inventory Coordinator
The Inventory Coordinator will be responsible for taking inventory of any usable or unusable medical marihuana
during all processes from seed to sale. The Inventory Coordinator will also be responsible for reporting any
inventory discrepancies to the appropriate supervisor.
Receptionist
The Receptionist is responsible for checking in a patient and ensuring the patient is an active card holder. Since the
Receptionist is the front lines of operations, it is imperative that this individual is professional, knowledgeable, and
trustworthy.
Provisioning Center Tech
The Provisioning Center Techs are responsible for verifying the status registered qualified patients and maintains
accurate records of transactions, patient data, and identification documents. They respond to inquiries and walk
guests through the facility.
59
Patient Care Specialist
The Patient Care Specialists will be stationed in the Provisioning Center and will dispense Medical Marihuana
Products to Patients. Other responsibilities will include providing each Patient/Designated Caregiver with
knowledgeable and welcoming service, entering each sale into the POS system, and working closely with the
General Manager to ensure the Provisioning Center area is clean and organized.
60
Blackstone Harvest, LLC – Other Compensation and Information
Our Company will provide a living wage that is at least 200% above the Federal Poverty Level for a family of two (2). All our employees will receive at least $15.00/hr. in wages and will be eligible for Company paid health insurance, as well as benefits. Our benefits will include, but are not limited to, paid vacation time off, paid personal time off, employee retirement savings plans,
which will include employer contributions, and an employer paid health insurance package,
among other things. Our Company also seeks to increase the number and diversity of job opportunities for residents in the City of Lansing (the “City”) and its surrounding community. We’re confident that our presence in the City will improve the standard of living and quality of life for many individuals
by increasing and improving the job opportunities available. We will build resources that support environmental protection, education, and cultural and social growth. Our educational programs and training will lead to a knowledgeable staff who will possess skillsets that will translate to opportunities for career growth and development.
Employer Covered Group Health Insurance Plan:
We will offer our employees health benefits. We will find a plan that best meets our needs and give employees the option to enroll in our group health insurance plan. Health insurance will be fully covered by our Company.
Employee Benefits:
Our Company will provide employees with a variety of benefits for working with us. We want
the best candidates and we will incentivize employees for staying with us by offering long-term
benefits. After the first six months of employment, employees will be eligible for a week of paid vacation time off and three (3) days of personal time off. After the first three (3) years of employment with our Company, employees will have two weeks of paid vacation time off, and four (4) days of personal time off.
Additionally, we will work with a nationally recognized service provider, such as Merrill Lynch, to adopt a retirement and benefits package for our employees to enroll in. Any employee that puts money towards their employee retirement account will receive a Company match of up to 3% of the employee’s yearly income.
Employee Bonuses: Our Company will offer bonuses to employees based on their performance and continued training. Bonuses will be discretionary and will be paid on a yearly basis after Q4.
61
Hiring Local:
Our Company will use its best efforts to employ City of Lansing residents. We will use existing City resources, and/or online recruitment services, to help us in the endeavor of receiving an abundance of employment applications from City residents. Our goal is to develop and maintain a dynamic partnership with City residents so that our Registered Patients can see familiar faces at
our facility.
Employing the Chronically Underemployed: We want to give the chronically underemployed new opportunities in this new and fascinating industry. Our commitment to hire locally will also be matched with our commitment to hire the
chronically underemployed. We will work to find individuals who have unexpectedly lost their jobs or are experiencing a significant drop in work hours. We will connect with the Michigan Unemployment Insurance Agency and use the Pure Michigan Talent Connect database to hire underemployed Michigan citizens.
62
Blackstone Harvest, LLC – Commitment to Pay Over $15.00/hr.
Our Company will provide a living wage that is at least 200% above the Federal Poverty Level for a family of two (2). All our employees will receive above $15.00/hr. in wages and will be eligible for Company paid health insurance, as well as benefits. Our benefits will include, but are not limited to, paid vacation time off, paid personal time off, employee retirement savings plans,
which will include employer contributions, and an employer paid health insurance package,
among other things.
63
Blackstone Harvest, LLC
Blackstone Harvest, LLC – Employee Staffing & Training Plan
CEO/President
64
EXHIBIT
12
CPA Attested Financial Statement
65
As of December 31, 2018
Statement of Financial Condition
Joann Steil
66
Accountants' Agreed Upon Procedures Report
Financial Statements:
Statement of Assets and Liabilities
Notes to Financial Statements
Table of Contents
As of December 31, 2018
Statement of Financial Condition
Joann Steil
67
Joann Steil
22618 Shorewood Dr
St. Clair Shores, MI 48081
We have performed and applied agreed-upon procedures enumerated below on behalf of Joann Steil.
These agreed-upon procedures were conducted in accordance with Statement on Standards for
Attestation Engagements (SSAE) established by the American Institute of Certified Public Accountants
(AICPA). The sufficiency of these procedures is solely the responsibility of those parties specified in
this report. Consequently, we make no representation regarding the sufficiency of the procedures
described below either for the purpose for which this report has been requested or for any other purpose.
These agreed upon procedures have been applied to determine the statement of financial condition of
Joann Steil as of December 31, 2018, and the related notes to the financial statement.
However, we do not express an opinion on these financial statements.
Joann Steil's Responsibility for the Financial Statement
Joann Steil is responsible for the preparation and fair presentation of this financial statement
in accordance with accounting principles generally accepted in the United States. This includes
the design, implementation, and maintenance of internal control relevant to the preparation and fair
presentation of a financial statement that is free from material misstatement whether due to fraud or error.
Accountant's Responsibility
Our responsibility is to conduct this engagement in accordance with Statements on Standards
for Attestation Engagements (SSAE) promulgated by the American Institute of Certified Public
Accountants (AICPA). We believe that the results of these procedures provide a reasonable basis
of our conclusion.
Accountant's Conclusion
Based on the agreed upon procedures performed, we declare to the best of our knowledge, the
statement of financial condition of Joann Steil is complete and accurate.
Best Regards,
Simon H. Gumma, CPA, CGMA
President
February 14, 2019
P: (248) 729-7171 / F: (248) 729-7373
Troy, MI 48084
888 W Big Beaver Rd, Ste 300
Certified Public Accounting
Gummaco, P.C.
68
Cash on Hand 1,000$
Cash in Banks
PNC Bank - Adv Plc Serv Inc Checking #...1339 24,748$
Extra Credit Union Checking #...0040 36,261
Extra Credit Union Savings #...0001 367,688
Extra Credit Union Savings #...8036 31,107
Chemical Bank Savings #...1238 87,577
Total 547,382
AXA Advisors Annuity 201,512
Furniture & Personal Effects 27,500
Jewelry 30,000
Automobiles / Boats / Motorcycles
2010 Jeep Wrangler Islander 20,000
2007 GMC Savana Conversion Van 9,500
2010 Rinker Boat 15,000
2002 Harley Davidson Road King Classic 20,000
2014 Harley Davidson Sportster 883 4,000
Total 68,500
Principal Residence - 22618 Shorewood Dr 450,000
Investments in Business Ventures 35,000
Investments in Real Estate 250,000
Total Assets 1,610,894$
Mortgage - Wells Fargo Bank 172,943$
Estimated income taxes on the difference
between the estimated current value of assets
and their tax basis (See Note 4)40,000
Total Liabilities 212,943$
Net Worth 1,397,951$
Total Liabilities and Net Worth 1,610,894$
Joann Steil
Statement of Financial Condition
As of December 31, 2018
Assets
Liabilities & Net Worth
69
Ownership Fair Market Net Share of
Business Description %Value (FMV)Liabilities Equity Equity
Advanced Placement Services Inc 100.000%35,000 - 35,000 35,000
Elder Care Placement Services
22618 Shorewood Dr
St. Clair Shores, MI 48081
Totals 35,000$ -$ 35,000$ 35,000$
Ownership Fair Market Total Share of
Real Estate Description %Value (FMV)Liabilities Equity Equity
10410 E Jefferson LLC 50.000%500,000 - 500,000 250,000
Future Development
10410 - 10440 E Jefferson Ave
Detroit, MI 48214
Totals
500,000$ -$ 500,000$ 250,000$
Schedule of Real Estate Investments
Joann Steil
Statement of Financial Condition
As of December 31, 2018
Schedule of Business Ventures
70
Note 1:
Estimated current values were based at either (1) fair market values,
(2) appraised values or (3) broker purchase opinion (BPO).
Note 2:
Amounts for Investments in Business Ventures were based on
compiled financial statements as of December 31, 2018.
Note 3:
Amounts for Investments in Commercial Real Estate were based at either
(1) fair market values, (2) appraised values or (3) broker purchase opinion (BPO).
Note 4:
Estimated income taxes have been provided on the excess of the
estimated current values of assets over their tax basis as if the
estimated current values of the assets, had been realized on the
statement date, using applicable tax and regulations.
The provision will probably differ from the amount of income taxes
that eventually might be paid because those amounts are determined
by the timing and the method of disposal or realization.
Joann Steil
Statement of Financial Condition
As of December 31, 2018
Notes to Financial Statements
71
EXHIBIT
15
Bank Statements, Annuity, Deed
72
73
74
75
76
77
78
79
80
81
EXHIBIT
16
Financial Structure Cover Page
82
Blackstone Harvest, LLC – Financial Structure and Financing
Blackstone Harvest, LLC is owned solely by its managing member, Joann Steil. Ms. Steil has provided CPA attested financials that demonstrate she has a net worth of almost $1.4 million, of which $500,000 is available in cash in her bank accounts. Additionally, Ms.
Steil has access to cash from an annuity valued at $201,512. These financials are supported by
bank/account statements included with this application. Ms. Steil acquired the property located at 6450 S. Cedar by land contract, which has limited her initial out-of-pocket costs significantly (although Ms. Steil is responsible for paying the remaining balance of the property over time).
Ms. Steil will acquire the property at 209 Baker by utilizing her cash and financing options. The interior and exterior renovations to the proposed provisioning center at 6450 S. Cedar and
the proposed grow facility at 209 Baker will be performed by 4 Seasons Contracting, which has
agreed to provide Ms. Steil with financing for the project. This type of arrangement is not uncommon for large projects like the proposed renovations to 6450 S. Cedar and 209 Baker.
83
EXHIBIT
17
Sworn Statement of Truthfulness
84
85
EXHIBIT
18
Odor Plan
86
Blackstone Harvest, LLC – Odor Plan
Our desire to be a good neighbor includes avoiding nuisances of odor that may be
generated by our operations. It’s not a secret – medical marijuana has a distinct odor. However, our company has designed the following odor control plan with our HVAC vendor to mitigate against such a nuisance: 1. The space will be conditioned using multiple split heat pump systems of various capacities and a ductless mini-split system. Each of the
split-systems, excluding the ductless mini-split system, are equipped
with unit-level pleated filters. Fresh air is brought to each of the
ducted systems via a fresh air duct that is run to the exterior of the
structure. This fresh air will tend to pressurize the space.
2. The space is designed for a negative pressure to contain internal odors. To accomplish this, an in-line, belt driven exhaust fan is provided to remove the amount of fresh air provided for the occupants and an additional amount that will ensure a negative pressure within the space.
3. To prevent odors from escaping the structure, the in-line exhaust fan
is equipped with a filter section loaded with approximately thirty
pounds of activated carbon, in a rack-mounted configuration.
Activated carbon is an extremely effective absorptive odor control
substance. An ozone generator will be placed upstream of the carbon
filters, in the housing assembly. Ozone (O3) is an effective odor
control mechanism. In this case, it is used to help control out-going airstream odors and recharge the activated carbon filter media, extending the life of the media.
4. Once systems are running, systems shall be air balanced to ensure
design air flows for supply, fresh air, and exhaust air base values have
been met. Once completed, a differential pressure gauge will be used
to ensure a negative building static of no less than .05” of negative
building static has been achieved. A maximum negative building
static shall not exceed .15”. An initial test with a trade-specific calibrated sensor establishes the base-line of operation for odors in the out-going air stream.
87
5. Once odor control has been established, periodic testing will be
conducted to ensure that the odor control systems are operating to maintain the baseline. As the filters age, replacement will be required and will be conducted, as determined by the calibrated sensor on the test equipment. 6. Testing will be done, in the absence of other standards in accordance
with Standardized Odor Measurement Practices for Air Quality
Testing. Testing shall be done using a field Olfactometer, calibrated in
accordance with odor control standards using the scheduled
monitoring protocol.
7. We will have planned and scheduled monitoring in which we will conduct a daily walk-about visit around the exterior of the site, near the exhaust system. We will compile and compare the data we record to establish norms using a 5-point Odor Intensity Reference Scale to
compare daily readings. If values equal 3 on the 5-point scale, then we
will evaluate and repair the carbon-filtration exhaust system, as
required. Evaluation will include, but is not limited to, fan operation,
distribution system integrity, and filter media effectiveness.
88
EXHIBIT
19
Sample Scoring Rubric
Provided by City
89
FINAL June 14, 2019
#Criteria Maximum
Points Ordinance Source
1 Ownership Structure Including percent ownership for each stakeholder 1 1300.05(b)(12)(i)
2 Organizational Chart Please include name, position and job description 1 1300.05(b)(12)(ii)
3 Worker Training Program 1 1300.05(b)(12)(vi)
4 Short and Long Term Goals and
Objectives 1 1300.05(b)(12)(viii)
5 Community Outreach & Education 1 1300.05(b)(12)(x)
6 Marketing, Advertising &
Promotion
Minimization of Exposure to Minors List methods/type, and how to
reduce chances of exposure to minors for each, including a budget and
examples.
3 1300.05(b)(12)(iii)
7 Tangible Capital Investment ‐
Dollar Amount
Total Capital Investment, stated in dollar amounts and supported by
factual data, which will directly benefit the City of Lansing, including all
types of medical marihuana facilities. Consideration of whether facility
is definite, feasible, or speculative.
Clarification 6/14/19: After reviewing the total TCI from the Top 20
Provisioning Centers in Phase 1, we determined the average TCI was
over $4 million. Scoring in this category will be distributed accordingly,
starting at ½ million of tangible capital investment.
5 1300.05(b)(12)(iv)
Medical Marijuana Provisioning Centers Scoring Criteria
Business Plan & Job Creation
6/14/19 ‐ City of Lansing Medical Marijuana Provisioning Center Scoring Criteria ‐ Phase 2 90
FINAL June 14, 2019
#Criteria Maximum
Points Ordinance Source
Medical Marijuana Provisioning Centers Scoring Criteria
8 Tangible Capital Investment ‐
Own/Lease
Documentation demonstrating ownership or exclusive lease of
provisioning center building by one or more stakeholders or applicant.
Preference given to ownership.
3 1300.05(b)(12)(iv)
9 Tangible Capital Investment ‐
Supporting Material
The completeness and quality of the documentation which
corroborates the financial figures provided for total capital investment 3 1300.05(b)(12)(iv)
10
Points awarded for evidence and explanation of the financial structure
and financing for the proposed medical marijuana establishment(s)
based upon (GAAP) general accepted accounting principles
2 1300.05(b)(12)(vii)
11 Proof of LARA Pre‐Qualification within 60 days of application filing 3
1300.08(e)
1300.04(b)
MCL 333.27402 (3)
(a), (b), (c )
12 Plans to Integrate Grower Facility
with other Establishments
Points awarded for evidence which documents ownership of licensed
(or pending application for) medical marijuana grow operations within
the City of Lansing.
4 1300.05(b)(12)(ix)
Financial Structure and Financing
6/14/19 ‐ City of Lansing Medical Marijuana Provisioning Center Scoring Criteria ‐ Phase 2 91
FINAL June 14, 2019
#Criteria Maximum
Points Ordinance Source
Medical Marijuana Provisioning Centers Scoring Criteria
13 Charitable Plans and Strategies Contributions, stated financial commitments, and/or volunteer work
supported by specific donation amount or value of volunteer work. 4 1300.05(b)(12)(xi)
14 Number of and job descriptions for FTE (Full‐time Equivalent) jobs at
this provisioning center ONLY.3 1300.05(b)(23)
14 Amount and type of other compensation ‐ Healthcare 2 1300.05(b)(23)
16 Amount and type of other compensation ‐ PTO
(Paid Time Off)1 1300.05(b)(23)
17 Amount and type of other compensation ‐ Retirement 1 1300.05(b)(23)
18 Percent of employees earning over $15 per hour.3 1300.05(b)(23)
19 Projected annual budget and revenue based upon (GAAP) generally
accepted accounting principles 2 1300.05(b)(23)
20
Number of additional jobs created by your stakeholders within the City
of Lansing at other medical marijuana facilities types.
(Grower/Processor)
6 1300.05(b)(12)(v)
Total ‐ Business Plan/Job
Creation Incomplete plan will get zero points 50 1300.06(b)(1)
Job Creation
6/14/19 ‐ City of Lansing Medical Marijuana Provisioning Center Scoring Criteria ‐ Phase 2 92
FINAL June 14, 2019
#Criteria Maximum
Points Ordinance Source
Medical Marijuana Provisioning Centers Scoring Criteria
21
Based on the completeness and amount of court‐ordered financial
liability reported on the Financial Resources Litigation history form. 1 1300.06(b)(5)
22 CPA Attestation of Net Worth or Bank Statements Supporting Initial
Start‐Up and Operating Costs 3
1300.05(b)(12)vii
1300.05(b)(22)
1300.06(b)(5)
MCL333.27402 (3)(a)
23 Proof LARA Pre‐Qualification submitted within 60 days of application
filing.3 1300.08(e)
MCL333.27402 (3)(a)
24 Combined stakeholder history of success in owning/operating a
relevant business or businesses in the City of Lansing. 1 1300.05(b)(8)
1300.06(b)(5)
25 Combined stakeholder history of success in owning/operating a
relevant business or businesses 1 1300.05(b)(8)
1300.06(b)(5)
26 Combined stakeholder history of success in owning/operating a
medical marihuana business or businesses.1 1300.05(b)(8)
1300.06(b)(5)
Total ‐ Financial Stability &
Experience 10 1300.06(b)(5)
Financial Stability & Experience
Sufficient Financial Resources
Business Experience
6/14/19 ‐ City of Lansing Medical Marijuana Provisioning Center Scoring Criteria ‐ Phase 2 93
FINAL June 14, 2019
#Criteria Maximum
Points Ordinance Source
Medical Marijuana Provisioning Centers Scoring Criteria
27
Surrounding Neighborhoods: Distance between residential zoned
areas and applicant's provisioning center. Evaluation is based on
whether any residential property abuts the proposed location, and if
not, whether there is residential zoning within 1/4 mile of the
proposed location.
7 1300.06(b)(2)
28
Surrounding Neighborhoods: Density of Provisioning Centers
surrounding the applicant's proposed location. Evaluation is based on
how many of the first round 20 PCs are within 1‐2 mile radius of
proposed provisioning center.
7 1300.06(b)(2)
29 Plan to Keep Traffic out of
Neighborhoods
Review of location site and any plan(s) the applicant has provided
which would minimize the traffic and parking impact on nearby
neighborhoods.
3 1300.06(b)(2)
30 Resident Safety Security Plan Review to ensure compliance with the Ordinance 3 1300.06(b)(2)
1300.05(b)(14)
Total ‐ Land Use 20 1300.06(b)(2)
Land Use
Impact on Neighborhood
6/14/19 ‐ City of Lansing Medical Marijuana Provisioning Center Scoring Criteria ‐ Phase 2 94
FINAL June 14, 2019
#Criteria Maximum
Points Ordinance Source
Medical Marijuana Provisioning Centers Scoring Criteria
31 Planned Outreach
Plan to meet with neighborhood organizations, business association,
crime watch, and other neighborhood organizations to provide contact
information for questions, concerns, etc.
1 1300.06(b)(3)
32 Improvements made or Proposed
to Building
Plan to make improvements to building and property. Applies to both
those that own and those that lease building. Please supply
documentation to support costs of improvements.
3 1300.06(b)(3)
33 Plan to Minimize/Eliminate Traffic Any plan(s) the applicant has provided which would minimize the
traffic and parking impact on nearby neighborhoods. 1 1300.06(b)(3)
1300.09(i)
34 Plan to minimize/eliminate noise
Any plan(s) the applicant has provided which would minimize or
eliminate the impact of increased noise on nearby neighborhoods.
Please document in budget of expenditures.
1 1300.06(b)(3)
1300.09(i)
35 Plan to Minimize/Eliminate Odor
Any plan(s) the applicant has provided which would minimize or
eliminate the impact of increased odor on nearby neighborhoods.
Please document in budget of expenditures.
4 1300.6B(3)
1300.09(i)
Total ‐ Outreach 10 1300.06(b)(3)
Outreach, Physical Improvements, Etc.
6/14/19 ‐ City of Lansing Medical Marijuana Provisioning Center Scoring Criteria ‐ Phase 2 95
FINAL June 14, 2019
#Criteria Maximum
Points Ordinance Source
Medical Marijuana Provisioning Centers Scoring Criteria
36 Applicant provides proof of LARA Pre‐Qualification within 60 days of
application filing. 2
1300.06(b)(4)
MCL 333.27401,
.27402 & .27405
37 Demonstration of regulatory compliance.5 1300.06(b)(4)
38
Based on the completeness and specific litigation reported on the
Morals, Good Order and General Welfare Litigation history form.3 1300.06(b)(4)
Total ‐ Applicant/Stakeholder
History
Will get zero points if found to have violated 2016 Ordinance #1202
Moratorium.10 1300.06(b)(4)
Total Points 100
Applicant/Stakeholders Record of
Acts Detrimental to Security,
Safety, Morals, Good Order,
General Welfare
Applicant/Stakeholder History
6/14/19 ‐ City of Lansing Medical Marijuana Provisioning Center Scoring Criteria ‐ Phase 2 96
97
October 30, 2019
Blackstone Harvest LLC
c/o Joann Steil
22618 Shorewood Dr
St Clair Shores, MI 48081
Dear Provisioning Center Applicant,
I have reviewed the report and recommendation of the hearing officer on your appeal of the Scoring and
Ranking denial of your application to operate a Medical Marihuana Provisioning Center in the City of Lansing
at 6450 S Cedar St. I have determined that your appeal is denied.
You have the right to appeal this denial of licensure to the Medical Marihuana Commission within thirty (30)
days of the date of this letter by filing a written statement to the Commission with the City Clerk’s Office.
The Medical Marihuana Commission Appeal will become a matter of public record. The Commission’s review
of the appeal shall not be de novo. The Commission shall only overturn, or modify, a decision or finding of
the Clerk if it finds such decision or finding to be arbitrary or capricious and not supported by material,
substantial, and competent facts on the whole record considered by the Clerk in arriving at such decision or
finding.
Chapter 1300 provides that should the applicant not receive a license, one-half the application fee shall be
returned. This refund will be processed after all appeals are exhausted.
If you have begun business operations pursuant to State Emergency Rule 19 and Executive Order 2017-02,
you must cease operations. Operations may resume only if your appeal is granted and the requirements of
licensure are satisfied.
Sincerely,
Chris Swope, CMMC
City Clerk
cc: M. Yankowski, Lansing Police Chief
J. Smiertka, Lansing City Attorney
Chris Swope
Lansing City Clerk
98
Clerk’s Statement of Facts
Blackstone Harvest LLC – 6450 S Cedar St
1. Section 10 – Financial Structure and Financing – Please refer to COL Exhibits: Public Scoring
Criteria, Score Sheet with Scoring Insights, and Blackstone Harvest Application Copy with list of
attachments for each section and signed attestations. Blackstone Harvest Exhibits 3, 4 and 5
cannot be considered for this section because they weren’t attached to this section of the
application.
2. Section 12 - Integration with Grows – Please refer to COL Exhibits: Blackstone Harvest Denial
Date and Blackstone Harvest Grow Application Date. Cure on appeal is not allowed. Exhibits 8
and 9 cannot be considered for this section because they weren’t attached to this section of
the application.
Section 20 – COL Jobs – Refer to Public Scoring Criteria and Score Sheet with Scoring Insights.
3. Section 19 – Projected Annual Budget –Refer to Public Scoring Criteria and Score Sheet with
Scoring Insights. Exhibit 6 cannot be considered for this section because they weren’t
attached to this section of the application.
4. Section 22 – Net Worth – Refer to Public Scoring Criteria and Score Sheet with Scoring
Insights. The name of the applicant is Blackstone Harvest, LLC. Please also review COL Exhibits
“LARA Advisory Bulletin” and “Definition of Compilation”. Exhibits 13, 14 & 15 cannot be
considered for this section because they weren’t attached to this section of the application.
5. Section 35 – Odor Plan - Exhibit 2 cannot be considered for this section because they
weren’t attached to this section of the application.
Email Attachments
1. Clerk’s Statement of Facts
2. Blackstone Harvest Hearing Officer Appeal
3. Application for Provisioning Center with Attachments Listed and Attestations Signed
4. Proof of Payment for Grow with Submission Date Highlighted
5. Proof of Application Date for Grow
6. Proof of Denial Date for PC
7. General Instructions for Submitting Application
8. Public Criteria
9. LARA Advisory Bulletin on CPA Attestations
10. American Institute of CPAs Definition of Compilation
99
City of Lansing
Hearing Officer Recommendation
In Re:
Blackstone Harvest, LLC
Proposed Location: 6450 S. Cedar St.
Provisioning Center License Denial
This recommendation is remitted to the Clerk of the City of Lansing by Hearing Officer Amanda
M. Brzezinski, Esq., having reviewed the facts and issues presented upon appeal of medical marihuana provisioning center licensure denial by BLACKSTONE HARVEST, LLC under the Lansing Medical Marihuana Ordinance Chapter 1300 (Chapter 1300). Chapter 1300.15(c) directs that upon notice of denial of licensure applicants may appeal to the City Clerk who shall
appoint a hearing officer to hear and evaluate the appeal and submit a recommendation to the
Clerk. The recommendation of the Hearing Officer in the aforementioned matter is that the license application for BLACKSTONE HARVEST, LLC remain denied.
FACTS
BLACKSTONE HARVEST, LLC (“Appellant”) applied to the City of Lansing for a license to operate a Medical Marihuana Provisioning Center within the city limits. This recommendation
follows a timely appeal from Appellant.
An email dated September 20, 2019, from the City Clerk’s office was sent to the Appellant providing notice of the license application denial, having received a score of 73.5 out of a possible 100 points, eliminating Appellant from top five scoring and the possibility of
provisioning center licensure. Within the email sub-scores and their determining factors were provided, as well as a link to the Public Scoring Criteria and appeal rights, grounds, and instructions.
Appellant’s Position
Appellant disputes the denial on a basis that (1) the scoring is not based on competent, material, and substantial evidence; 2) scoring insights were based on clearly erroneous findings; 3) the score was based on improper/inconsistent scoring; 4) scoring methods do not comply with the ordinance; 5) scoring insights were inconsistent with the ordinance; 6) scoring decisions related
to Appellants application were arbitrary and capricious; and 7) scoring was based on an abuse of discretion.
City Clerk Position
The City Clerk affirms its position on the denial based on the Public Scoring Criteria,
Appellant’s Score Sheet with Scoring Insights, Appellant’s Application Copy with attachment
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lists for each section, and signed attestations. The City Clerk also asserts Chapter 1300.5(b) and the general legal standard that no right to cure exists upon appeal.
APPLICABLE LAW & REASONING
The issue is whether Appellant’s Provisioning Center License Application was erroneously
denied. The City of Lansing’s authority to issue licenses exists within its lawful police powers to regulate activities within the City, and it outlines the appellate procedure by ordinance within the City Charter.1
“The City Council shall provide, by ordinance, a procedure for the issuance of licenses and permits. The ordinance shall, to the greatest extent possible, place the responsibility for the issuance of licenses and permits under one official in order that persons requesting
specific licenses and permits will not have to contact more than one City office.”2
Here, the City has placed responsibility for Provisioning Center licensing with the City Clerk. Upon denial of a Provisioning Center License application, Chapter 1300.15(c) permits applicants to appeal the denial with the City Clerk, who shall appoint a Hearing Officer to evaluate the appeal and submit a recommendation to the Clerk. The Clerk will then review the
recommendation and report of the Hearing Officer and render a decision on the matter, which may be further appealed to the Medical Marihuana Commission for judicial review purposes.3 “The Commission's review of an appeal shall not be de novo. The Commission shall
only overturn, or modify, a decision or finding of the Clerk if it finds such decision or
finding to be arbitrary or capricious and not supported by material, substantial, and competent facts on the whole record considered by the Clerk in arriving at such decision or finding.”4 The Michigan Court of Appeals defined the arbitrary and capricious standard within Cona v.
Avondale: "'[A]rbitrary' means fixed or arrived at through an exercise of will or by caprice, without consideration or adjustment with reference to principles, circumstances or significance,
and 'capricious' means apt to change suddenly, freakish or whimsical. For instance, a
reason is arbitrary and capricious if it is based on prejudice, animus or improper motives."5
1 See LANSING CITY CLERK’S OFFICE, City of Lansing Charter (as amended) at 8-101.1-.2 (2019) available at:
https://library.municode.com/mi/lansing/codes/code_of_ordinances?nodeId=CHLAMI_ART8REPOCO_CH1LI_8-
102ISLI.
2 Id. at 8-102.
3 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.15(c).
4 Id. at 1300.03(e).
5 See Cona v Avondale Sch Dist, 303 Mich App 123; 842 NW2d 277 (2013).
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3
This recommendation will cogitate the arbitrary and capricious definition above when examining the submitted appeal for errors, prejudice, animus, or improper motives on the part of the City
Clerk in the denial of the Provisioning Center license. Appellant’s brief sections do not align with their seven assertions which serve as their basis for their appeal, so the Hearing Officer will consider Appellant’s brief sections which are tied to the
scoring sections of the Public Scoring Criteria Sheet.
Financial Structure & Financing (Section 10) Appellant contends that the City Clerk’s scoring determination was arbitrary and unreasonable, for only awarding 1 of 2 points possible within Section 10 “Financial Structure and Scoring” of
the Scoring Sheet for not including a startup budget with the application. Appellant points to Chapter 1300.05(b)(23) of the as the submission criteria for Section 10, when the Public Scoring Sheet and City of Lansing Medical Marihuana Facilities Application Checklist both stress that Section 10 scoring is rooted in Chapter1300.05(b)(12)(vii) of the Ordinance which states:
“(b)A complete application for a license or licenses required by this chapter shall be made under oath on forms provided by the City Clerk, and shall contain all of the following: … (12)A copy of the proposed business plan for the establishment, including, but not limited to, the following: … (vii)Financial structure and financing of the proposed medical marihuana establishment(s)”6
The Ordinance above clearly requires that a complete application be submitted to the City Clerk including but not limited to financial structure and financing. The Public Scoring Sheet Criteria also informs:
“Points awarded for evidence and explanation of the financial structure and financing for the proposed medical marijuana establishment(s) based upon (GAAP) general accepted accounting principles”7 The Public Scoring Sheet Criteria clearly advises applicants that points will be awarded for
evidence and explanation of the financial structure, and the burden is on the applicant to clearly present both evidence and an explanation, as to not leave the City Clerk’s office piecing together an applicant’s financial structure with assumptions. The burden was on the Appellant to explain with effectively presented evidence that the larger first year budget was due to the inclusion of
startup costs, not upon the Clerk to inherently know the detail of Appellant’s business plan.
6 See LANSING CITY CLERK’S OFFICE, City of Lansing Charter (as amended) at 8-101.1-.2 (2019) available at:
https://library.municode.com/mi/lansing/codes/code_of_ordinances?nodeId=CHLAMI_ART8REPOCO_CH1LI_8-
102ISLI; City of Lansing Medical Marijuana Facilities Application Checklist, available at:
https://www.lansingmi.gov/DocumentCenter/View/7846/Medical-Marijuana-Facilities-Application-
Checklist?bidId=; City of Lansing Medical Marijuana Provisioning Center Scoring Criteria, available at:
https://www.lansingmi.gov/DocumentCenter/View/7907/Final-Phase-2-Criteria---June-14-2019?bidId=.
7 Id. Scoring Criteria.
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4
Startup costs are the expenses incurred during the process of creating a new business. These can be quite different from a typical annual budget, therefor it could be seen as an appropriate
measure to break them out in their own budget – especially when they are being reviewed by a city with many interests to balance within the licensing process. Essential to the startup effort is the creation of a business plan – a detailed map of the new
business to be created. A business plan forces consideration of the different startup costs for the
business. Underestimating expenses will falsely increase expected net profit. The Appellant states that the scorer’s determination was unreasonable. The granting of limited availability licenses to best-scoring applicants, in an effort to ensure successful businesses within the city limits, is reasonable with the city keeping the best interests of the customers who will
rely upon the business in mind, as well as the City’s best interests in mind of a thriving community including business that will not draw upon City resources due to incomplete planning, but will instead contribute to the area’s success.
Appellant’s exhibit’s 3, 4 and 5 will not be considered for Section 10 within this
recommendation as they were not submitted with Section 10 on the application and no efforts to cure application deficiencies on appeal are permissible per Chapter 1300.5(b) stating “A complete application for a license or licenses required by this chapter shall be made…” and general state appellate practice; review available on appeal is to the record originally submitted and reviewed.8
Integration with Grows (Section 12) & Total COL Jobs (Section 20) Zero points were awarded to Appellant in Section 12 of the Scoring Sheet. The Provisioning
Center Scoring Criteria points applicants to Chapter1300.05(b)(12)(ix) which states:
“If a medical marihuana grower facility(ies) are proposed, plans to integrate such facility(ies) with other proposed medical marihuana establishments and a statement whether the medical marihuana grower facility will grow 1,000 plants or more and the square footage of the building(s) housing such grower facility, and if so, will the facility
contain more than 10,000 square feet of space;”9 The Public Scoring Sheet Criteria states:
“Points awarded for evidence which documents ownership of licensed (or pending
application for) medical marijuana grow operations within the City of Lansing.” Appellant did submit an Integration Plan with their application which stated they will own a grow, but no applications for a grow had been submitted which led the Clerk to deem the statement speculative as it had no accompanying supporting evidence. Exhibits 8 and 9 cannot be
considered as supporting evidence of Appellant’s intent as they were not submitted with the correct section of the initial application as specifically instructed within the application
8 See Napier v. Jacobs, 429 Mich. 222, 232-35 (1987).
9 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.05(b)(12)(ix).
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5
instructions. As discussed above, there is no right to cure upon appeal. With numerous applicants, and one Clerk with other duties, applicants must heed and follow instructions.
Appellant points to Exhibit 10, an application submitted for a Grower Facility submitted on October 2, 2019 well after notice from the City Clerk that the Provisioning Center License Application was denied (September 20, 2019).
Section 20 points applicants to Chapter 1300.05(b)(12)(v) which states the proposed business
plan shall be submitted with: “Expected job creation from the proposed medical marihuana establishment(s)”10 The Scoring Criteria advises that points shall be awarded for the:
“Number of additional jobs created by your stakeholders within the City of Lansing at other medical marijuana facilities types (Grower/Processor).”11
Since the Appellant had not submitted a Grower Facility application until well after the license
application was reviewed, it is reasonable and appropriate to find the number of additional jobs created by Appellant’s stakeholders within the City at other medical marijuana facilities speculative and the zero points awarded are affirmed. The Scoring Criteria made available to the public states that incomplete plans will be awarded zero points.
Projected Annual Budget (Section 19) The Medical Marijuana Provisioning Centers Scoring Criteria sheet that is available to the public states that the ordinance source for Section 19 is Chapter 1300.05(b)(23):
“An estimate of the number and type of jobs that the medical marihuana establishment is expected to create, the amount and type of compensation expected to be paid for such jobs, and the projected annual budget and revenue of the medical marihuana establishment.”12
The Public Scoring Criteria advises that points will be awarded for providing the: “Projected annual budget and revenue based upon (GAAP) generally accepted accounting principles”13
The City Clerk states on the Scoring Insights that no startup budget was included within this section of the application. As discussed above regarding the lack of submitting appropriate documentation and evidence, in this case a startup budget, can reasonably lead to zero points being awarded in a scoring category.
10 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.05(b)(12)(v).
11 City of Lansing Medical Marijuana Provisioning Center Scoring Criteria.
12 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.05(b)(23).
13 City of Lansing Medical Marijuana Provisioning Center Scoring Criteria.
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6
Appellant points to exhibit 6, supporting materials that were provided within the application upon submission but again, they were not attached within the correct, corresponding application
section and therefore were not considered for scoring in that section and now cannot be considered as an attempt to cure upon appeal.
Net Worth (Section 22)
Provisioning Centers Scoring Criteria cites four areas as its ordinance source. The first is MCL333.27402(3)(a) which states: “(3) In determining whether to grant a license to an applicant, the board may also consider all of the following: (a) The integrity, moral character, and reputation; personal
and business probity; financial ability and experience; and responsibility or means to operate or maintain a marihuana facility of the applicant and of any other person that meets either of the following: (i) Controls, directly or indirectly, the applicant. (ii) Is controlled, directly or indirectly, by the applicant or by a person who controls, directly or
indirectly, the applicant.”14
Appellate contends that there was an error in not awarding any of the possible three points in this section. Appellant submitted a detailed “personal” financial statement from her CPA. Appellant’s Exhibit 12 does show the financial state of a Joann Stiel, but no mention is made of BLACKSTONE HARVEST LLC who is the license applicant. Nor any supporting evidence of
Appellant’s claim that BLACKSTONE HARVEST LLC is solely owned and operated by Ms. Stiel. Without more evidence and explanation presented within this section of the application, it is reasonable and prudent to not assume a connection. Exhibit’s 13, 14 and 15 cannot be considered as they were not attached to this section of the application as supporting evidence.
The Provisioning Centers Scoring Criteria next points to Chapter 1300.05(b)(12)(vii) which states: “Financial structure and financing of the proposed medical marihuana establishment(s)”15
Applicant received no points allocated for omitting to provide a startup budget as discussed earlier. Of note is the corresponding Scoring Criteria description “CPA Attestation of Net Worth or Bank Statements Supporting Initial Start‐Up and Operating Costs” which specifically call out the need to clearly show initial startup costs.
The third citation of the Section 22 ordinance source is Chapter 1300.05(b)(22): “Verification, including copies of actual bank statements, showing that the applicant has minimum net worth of $100,000.00 in the applicant's name.”16
14 MMFLA, MCL § 333.27402(3)(a).
15 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.05(b)(12)(vii).
16 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.05(b)(22).
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This distinctly points out that the applicant is to have the net worth documentation in the applicant’s name. Here, the applicant is BLACKSTONE HARVEST LLC.
The final citation of the Section 22 ordinance source is Chapter 1300.06(b)(5) which directs the City Clerk to assess:
“Whether the applicant has reasonably and tangibly demonstrated it possesses sufficient
financial resources to fund, and the requisite business experience to execute, the submitted business plan and other plans required by Section 1300.05.”17 Appellant did not reasonably and tangibly demonstrate BLACKSTONE HARVEST LLC possessed sufficient financial resources due to the lack of clarity and thorough explanation in the
application and materials attached within that section. No points shall be awarded for assumptions and the drawing of conclusions on the applicant’s behalf.
Odor Plan (Section 35)
The Provisioning Centers Scoring Criteria states up to four points will be awarded for: “Any plan(s) the applicant has provided which would minimize or eliminate the impact of increased odor on nearby neighborhoods. Please document in budget of expenditures.”18
Chapter 1300.06(b)(3) states: “Planned outreach on behalf of the proposed establishment, and whether the applicant or
its stakeholders have made, or plan to make, significant physical improvements to the
building housing the medical marihuana establishment, including plans to eliminate or minimize traffic, noise, and odor effects on the surrounding neighborhood.”19 Chapter 1300.09(i) states:
“No medical marihuana provisioning center shall be operated in a manner creating noise, dust, vibration, glare, fumes, or odors detectable to normal senses beyond the boundaries of the property on which the medical marihuana provisioning center is operated; or any other nuisance that hinders the public health, safety and welfare of the residents of the
City.”20
The City Clerk awarded 3 of a possible 4 points for this section because the applicant did not provide specifications and documentation of the odor plan that was submitted within a budget attached in the section of the application which is requested within the Scoring Criteria.
17 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.06(b)(5).
18 City of Lansing Medical Marijuana Provisioning Center Scoring Criteria.
19 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.06(b)(3).
20 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.09(i).
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Appellant’s reference to Exhibit 2 is inappropriate as the Exhibit was not attached within this section of the application.
CONCLUSION
After reviewing the following:
1. Appellant’s brief and the Exhibits that were initially attached to the appropriate, corresponding application sections, 2. The City Clerk’s Statement of Facts 3. The Lansing Medical Marihuana Ordinance Chapter 1300 4. The Provisioning Centers Scoring Criteria
5. The Signed Application for Provisioning Center with Attachments Listed and Attestations 6. Proof of Payment for Grow with Submission Date Highlighted 7. Proof of Application Date for Grow
8. Proof of Denial Date for Provisioning Center
9. General Instructions for Submitting Application 10. The Public Criteria 11. LARA’s Advisory Bulletin on CPA Attestations 12. The American Institute of CPAs Definition of Compilation
The recommendation of the Hearing Officer formed above is that Appellant’s application for a Provisioning Center License remain denied. Respectfully Submitted,
/s/ Amanda M. Brzezinski Amanda M. Brzezinski, Esq., Hearing Officer P83413
Dated: October 24, 2019
107
City of Lansing Provisioning Center Ranking 10/30/2019 4:16 PM
Total
Possible
Points
Blackstone Harvest LLC - District Club-6450 S. Cedar
Applicant Address ---
#Category ---Score Location of material Scoring Insights
1 Ownership Structure 1 1 Org Docs, Ownership Struc., 1 pg.Has structure. 8/12/19
2 Organizational Chart 1 1 Org Docs, Org Chart, 6 pgs.Has org chart. 8/12/19
3 Worker Training Program 1 1 OtherReqDocs, Worker Training Plan, 95 pgs.Has plan. 8/12/19
4 Short and Long Term Goals and
Objectives 1 1 Org Docs, Goals, 71 pgs.Has goals. 8/12/19
5 Community Outreach &
Education 1 1 Community Outreach, Outreach&Ed, 7 pgs. Has plan. 8/12/19
6 Marketing, Advertising &
Promotion 3 3 Marketing Five examples of minor minimization with good detail. Includes marketing materials. Includes budget.
7/9/19
7 Tangible Capital Investment
Dollar Amount 5 5 4 page Investment Plan in TCI section Calculated $4,883,250 TCI from narrative. 8/12/19
8 Tangible Capital Investment
Own/Lease 3 3 19 pages in Lease with Permission in TCI Folder Stakeholder owns the property. 8/12/19
9 Tangible Capital Investment
Supporting Material 3 3 47 pages in TCI Supporting Documents Has supporting materials which fully corroborate stated/calculated TCI. 8/12/19
10 Financial Structure & Financing 2 1 Job Creation, Budget Revenue 1 page and Finance, Startup Costs
Budget 1 page 3 year budget with revenue and line item expenses. No startup budget attached. 8/21/19
11 LARA Pre-Qual 3 3 demo of reg prequalification Received prequalification letter dated 7/18/19 for Blackstone Harvest, LLC. 8/12/19
12 Integration with Grows 4 0 Integration
Integration Plan
Integration plan says they will have grow, but does not have any application(s) submitted. Deemed
speculative. 9/20/19
13 Charitable Plans & Strategies 4 3 Charitable
Charitable Plan Plans to contribute $125K in cash and $10K in volunteer time. No receipts or agreements. 8/12/19
14 Number of and job descriptions
for PC ONLY 3 3 Job Creation
FTE's 34-40 FTE's at PC. Job descriptions with adequate detail. 8/12/19
15 Healthcare 2 2 Job Creation
Healthcare Employer will provide healthcare. 8/12/19
16 Paid Time Off 1 1 Job Creation
Healthcare Employer will provide paid time off. 9/12/19
17 Retirement 1 1 Job Creation
Healthcare Employer will provide 401K or similar plan. 8/12/19
18 % of employees at $15+/hr 3 3 Job Creation
Plus 15 100% of employees will make $15+/hr. 8/12/19
19 Projected Annual Budget 2 1 Job Creation, Budget Revenue 1 page and Finance, Startup Costs
Budget 1 page 3 year budget with revenue and line item expenses. No startup budget attached. 8/21/19
20 Total COL Jobs 6 0 Job Creation
Lansing Jobs Has not submitted application for grow, therefore jobs are speculative 9/16/19
Total Business Plan &
Job Creation 50 37
21 Financial Litigation History 1 1 Financial Litigation History Form Financial Litigation History Form submitted on sole stakeholder. 7/10/19
22 Net Worth 3 0 6 pages in Financial Section of Laserfiche
Doesn’t have $100K in a bank account in the applicant’s name.
Doesn’t have solid proof of net worth. No submitted document in name of applicant. 9/16/19
Doesn’t have full documentation of initial start-up and operating costs. 9/12/19
23 LARA Pre-Qual 3 3 demo of reg prequalification Received prequalification letter dated 7/18/19 for Blackstone Harvest, LLC. 8/12/19
24 Stakeholder Experience
City of Lansing Businesses 1 0 Experience Stakeholder Resume Resume does not list any Lansing business ownership. 7/12/19
25 Stakeholder Experience
Relevant Businesses 1 1 Experience Stakeholder Resume Sole stakeholder has 18 years experience in a medical related field. 7/12/19
26 Stakeholder Experience
Medical Marijuana Business 1 0 Experience Stakeholder Resume Sole stakeholder did not list any medical marijuana related experience. 7/12/19
Total Financial Stability
&
Business Experience
10 5
1108
City of Lansing Provisioning Center Ranking 10/30/2019 4:16 PM
27 Impact on Neighborhood
Distance Between PC &
Residential Zoning
7 5
https://lansing.maps.arcgis.com/apps/webappviewe
r/index.html?id=be0634345255438ba55b14c9b19e9f
22
PC has residential zoned property within 1/4 mile. 9/20/19
28 Impact on Neighborhood
Density of PCs 7 1.5
https://lansing.maps.arcgis.com/apps/webappviewe
r/index.html?id=be0634345255438ba55b14c9b19e9f
22
Lose 2 points for every existing PC within a 1/2 mile radius. None
Lose 1 point for every existing PC within a 1 mile radius. #5, #9, #10, #11, #13
Lose .5 point for every existing PC within a 1.5 mile radius.#2
Lose .25 point for every existing PC within a 2 mile radius. None
Lost 5.5 points. 8/12/19
29 Traffic & Parking 3 3 Public Service Review Tier 1 plan. Excellent parking/circulation. 8/30/19
30 Security Plan 3 3 LPD Review Tier I - bank vault, on site guard, alarm system w/ color printer, panic button, off site video storage,
Man trap barrier, equipment specs 8/20/19
Total - Land Use &
Resident Safety 20 12.50
31 Planned Outreach 1 1 Community Outreach, Outreach&Ed, 7 pgs. Has plan. 8/12/19
32 Improvements to Building 3 3 Building Improvements
Support Docs
SEV-$280,600
Proposed Improvements $643,250.00 - 229% of SEV
Has proposal from ZA Design Build which supports that amount. 8/26/19
33 Plan to Minimize Traffic 1 1 Traffic Study, Neighborhood Compatibility & Plans to minimize
traffic 10pgs total Has a plan. 9/12/19
34 Noise Plan 1 1 Noise & Odor
Noise Plan Has plan. 8/12/19
35 Odor Plan 4 3 Noise & Odor
Odor Plan, Odor Plan, 2 pages Has detailed plan, but no specs or budget. 8/12/19
Total Outreach 10 9
36 Stakeholder History
Proof of LARA Prequal 2 2 demo of reg prequalification Received prequalification letter dated 7/18/19 for Blackstone Harvest, LLC. 8/12/19
37 Demo of Regulatory
Compliance 5 5
https://bsaonline.com/SiteSearch/SiteSearchDetails?SearchFocus=
All+Records&SearchCategory=Address&SearchText=6450+s+cedar
&uid=384&PageIndex=1&ReferenceKey=33-01-05-10-151-
012&ReferenceType=0&SortBy=&SearchOrigin=0&RecordKeyDisplayString=33-01-05-10-151-012&RecordKey=1%3d33-01-05-10-151-
012%3a%3a4%3d33-01-05-10-151-012%3a%3a7%3d55b67cb1-
daee-40e6-9dae-
9f2801426ce9%3a%3a13%3d4975&RecordKeyType=1%3d0%3a%3
a4%3d0%3a%3a7%3d2%3a%3a13%3d1
No code violations, no conditional denial letters. 9/12/19
38 Morals, Good Order & General
Welfare Litigation History 3 3 Morals Lit Hist Demo of Reg Has completed form(s) for all stakeholder(s). 9/12/19
Total Applicant
Stakeholder History 10 10
Total Score 100 73.50
2109
The Harfouch Law Firm, PLLC
631 E Big Beaver Rd, Suite 211
Troy, MI 48083
Ph: (248) 274-6529
Fax: (248) 850-2424
www.harfouchlaw.com
Nadeem Noah Harfouch* * Admitted to Practice in:
Michigan November 27, 2019
Mr. Chris Swope VIA ELECTRONIC MAIL Lansing City Clerk Ninth Floor, City Hall 124 W. Michigan Ave
Lansing, MI 48933
Re: Medical Marihuana Commission Appeal Denial of Provisioning Center Application for Blackstone Harvest, LLC Proposed location: 6450 S. Cedar St., Lansing, MI
Dear Mr. Swope: This appeal to the Medical Marihuana Commission is being submitted pursuant the Lansing City Ordinance No. 1300.15 on behalf of Blackstone Harvest, LLC (“Blackstone”) for their application to operate a
Provisioning Center at the above-referenced address.
On September 20, 2019, the Lansing City Clerk’s Office notified Blackstone via e-mail that its application for a provisioning center was denied (See Attached Exhibit A). The Clerk provided a scoring rubric with notes on each subsection (See Attached Exhibit B). The e-mail stated that Blackstone received a
score of 73.50 out of 100, thereby eliminating Blackstone from scoring in the top five. Blackstone, through its
counsel, appealed the Clerk’s decision, which was subsequently assigned to a Hearing Officer. On October 30, 2018 the Clerk’s Office notified Blackstone that after reviewing the report and recommendation of the Hearing Officer, the Clerk determined that the appeal was denied (See Attached
Exhibit C). Attached with the correspondence was a recommendation report from the Hearing Officer as well
as an updated scoring rubric, concluding that the application remained denied (See Attached Exhibit D). There are several issues found in the Hearing Officer’s denial letter and updated scoring rubric that are disputable. We have outlined those issues in our attached appeal.
110
Attached hereto as Exhibit E is Blackstone’s appeal to the Medical Marihuana Commission. The basis for this appeal is that the scoring was arbitrary and capricious; the scoring is not supported by material, substantial, and competent facts on the whole record considered by the Clerk in arriving at such a decision; and
the scoring methods do not comply with the requirements set forth by the Ordinance. Therefore, the applicant’s
entire application should be re-scored. Please forward this Letter and Appeal to the Marihuana Commission for review.
Thank you for your attention to this matter. If you have any questions or concerns, please feel free to
contact our office. Very truly yours,
Nadeem Noah Harfouch
NNH w/ Enclosures
cc: Blackstone Harvest, LLC (via Electronic Mail)
111
EXHIBIT
A
112
From: "Smith-Zande, Jennifer" <Jennifer.Smith-Zande@lansingmi.gov> Date: September 20, 2019 at 4:42:48 PM EDT To: "jsteil902@gmail.com" <jsteil902@gmail.com>
Cc: "Swope, Chris" <Chris.Swope@lansingmi.gov>, "Jackson, Brian" <Brian.Jackson@lansingmi.gov>, "Biehler, Deb" <Deb.Biehler@lansingmi.gov>, "O'Boyle, Amanda" <Amanda.O'Boyle@lansingmi.gov>, "Sumner, Heather" <Heather.Sumner@lansingmi.gov> Subject: Application Denial - Blackstone Harvest, LLC - Score & Rank
September 20, 2019
Blackstone Harvest, LLC
Joann Steil
22618 Shorewood DR
St. Clair Shores, MI 48081
Dear Provisioning Center Applicant,
The Lansing City Ordinance section 1300.6 discusses Provisioning Center license application evaluation. Your score of 73.50 out of 100 eliminates the possibility of scoring in the top five. Therefore, your application for licensure is denied.
Attached are your sub-scores based on the criteria posted on https://lansingmi.gov/1637/Medical-Marijuana and a brief summary of determining factors for each sub-score.
You will not be selected to receive a Provisioning Center license in the City of Lansing for the proposed business at 6450 S Cedar St.
You have the right to appeal this denial of licensure within 14 days of the date of this letter by filing with the City Clerk’s Office a written statement setting forth fully the grounds for the appeal pursuant to Chapter 1300.15(c). Please note that initial appeals are referred to a hearing officer appointed by the City Clerk who will review the appeal and information submitted. The hearing officer will consider the
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information and make a recommendation to the City Clerk, who will make a decision on the appeal. To encourage efficiency, appeals will be conducted as a paper hearing without oral presentation. Please ensure that you include all information in your written appeal that you would like the hearing officer to consider. Appeals are limited to materials provided during the application process. No new application material will be considered on appeal.
Chapter 1300 provides that should the applicant not receive a license, one-half the application fee shall be returned. This refund will be processed after all appeals are exhausted.
Sincerely,
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Blackstone Harvest LLC (District Club) - 6450 S. Cedar Street.pdf 90K
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EXHIBIT
B
115
City of Lansing Provisioning Center Ranking 9/20/2019 3:51 PM
Total
Possible
Points
Blackstone Harvest LLC ‐ District Club‐6450 S. Cedar
Applicant Address ‐‐‐
#Category ‐‐‐Score Location of material Scoring Insights
1 Ownership Structure 1 1 Org Docs, Ownership Struc., 1 pg.Has structure. 8/12/19
2 Organizational Chart 1 1 Org Docs, Org Chart, 6 pgs.Has org chart. 8/12/19
3 Worker Training Program 1 1 OtherReqDocs, Worker Training Plan, 95 pgs.Has plan. 8/12/19
4 Short and Long Term Goals and
Objectives 1 1 Org Docs, Goals, 71 pgs.Has goals. 8/12/19
5 Community Outreach &
Education 1 1 Community Outreach, Outreach&Ed, 7 pgs. Has plan. 8/12/19
6 Marketing, Advertising &
Promotion 3 3 Marketing Five examples of minor minimization with good detail. Includes marketing materials. Includes
budget. 7/9/19
7 Tangible Capital Investment
Dollar Amount 5 5 4 page Investment Plan in TCI section Calculated $4,883,250 TCI from narrative. 8/12/19
8 Tangible Capital Investment
Own/Lease 3 3 19 pages in Lease with Permission in TCI Folder Stakeholder owns the property. 8/12/19
9 Tangible Capital Investment
Supporting Material 3 3 47 pages in TCI Supporting Documents Has supporting materials which fully corroborate stated/calculated TCI. 8/12/19
10 Financial Structure & Financing 2 1 Job Creation, Budget Revenue 1 page and Finance, Startup Costs
Budget 1 page 3 year budget with revenue and line item expenses. No startup budget attached. 8/21/19
11 LARA Pre‐Qual 3 3 demo of reg prequalification Received prequalification letter dated 7/18/19 for Blackstone Harvest, LLC. 8/12/19
12 Integration with Grows 4 0 Integration
Integration Plan
Integration plan says they will have grow, but does not have any application(s) submitted. Deemed
speculative. 9/20/19
13 Charitable Plans & Strategies 4 3 Charitable
Charitable Plan Plans to contribute $125K in cash and $10K in volunteer time. No receipts or agreements. 8/12/19
14 Number of and job
descriptions for PC ONLY 3 3 Job Creation
FTE's 34‐40 FTE's at PC. Job descriptions with adequate detail. 8/12/19
15 Healthcare 2 2 Job Creation
Healthcare Employer will provide healthcare. 8/12/19
16 Paid Time Off 1 1 Job Creation
Healthcare Employer will provide paid time off. 9/12/19
17 Retirement 1 1 Job Creation
Healthcare Employer will provide 401K or similar plan. 8/12/19
18 % of employees at $15+/hr 3 3 Job Creation
Plus 15 100% of employees will make $15+/hr. 8/12/19
19 Projected Annual Budget 2 1 Job Creation, Budget Revenue 1 page and Finance, Startup Costs
Budget 1 page 3 year budget with revenue and line item expenses. No startup budget attached. 8/21/19
20 Total COL Jobs 6 0 Job Creation
Lansing Jobs Has not submitted application for grow, therefore jobs are speculative 9/16/19
Total Business Plan &
Job Creation 50 37
21 Financial Litigation History 1 1 Financial Litigation History Form Financial Litigation History Form submitted on sole stakeholder. 7/10/19
22 Net Worth 3 0 6 pages in Financial Section of Laserfiche
Doesn’t have $100K in a bank account in the applicant’s name.
Doesn’t have solid proof of net worth. No submitted document in name of applicant. 9/16/19
Doesn’t have full documentation of initial start‐up and operating costs. 9/12/19
23 LARA Pre‐Qual 3 3 demo of reg prequalification Received prequalification letter dated 7/18/19 for Blackstone Harvest, LLC. 8/12/19
24 Stakeholder Experience
City of Lansing Businesses 1 0 Experience Stakeholder Resume Resume does not list any Lansing business ownership. 7/12/19
25 Stakeholder Experience
Relevant Businesses 1 1 Experience Stakeholder Resume Sole stakeholder has 18 years experience in a medical related field. 7/12/19
26 Stakeholder Experience
Medical Marijuana Business 1 0 Experience Stakeholder Resume Sole stakeholder did not list any medical marijuana related experience. 7/12/19
Total Financial Stability
&
Business Experience
10 5
27
Impact on Neighborhood
Distance Between PC &
Residential Zoning
7 5
https://lansing.maps.arcgis.com/apps/webappviewe
r/index.html?id=be0634345255438ba55b14c9b19e9f
22
PC has residential zoned property within 1/4 mile. 9/20/19
1116
City of Lansing Provisioning Center Ranking 9/20/2019 3:51 PM
28 Impact on Neighborhood
Density of PCs 7 1.5
https://lansing.maps.arcgis.com/apps/webappviewe
r/index.html?id=be0634345255438ba55b14c9b19e9f
22
Lose 2 points for every existing PC within a 1/2 mile radius. None
Lose 1 point for every existing PC within a 1 mile radius. #5, #9, #10, #11, #13
Lose .5 point for every existing PC within a 1.5 mile radius.#2
Lose .25 point for every existing PC within a 2 mile radius. None
Lost 5.5 points. 8/12/19
29 Traffic & Parking 3 3 Public Service Review Tier 1 plan. Excellent parking/circulation. 8/30/19
30 Security Plan 3 3 LPD Review Tier I ‐ bank vault, on site guard, alarm system w/ color printer, panic button, off site video storage,
Man trap barrier, equipment specs 8/20/19
Total ‐ Land Use &
Resident Safety 20 12.50
31 Planned Outreach 1 1 Community Outreach, Outreach&Ed, 7 pgs. Has plan. 8/12/19
32 Improvements to Building 3 3 Building Improvements
Support Docs
SEV‐$280,600
Proposed Improvements $643,250.00 ‐ 229% of SEV
Has proposal from ZA Design Build which supports that amount. 8/26/19
33 Plan to Minimize Traffic 1 1 Traffic Study, Neighborhood Compatibility & Plans to minimize
traffic 10pgs total Has a plan. 9/12/19
34 Noise Plan 1 1 Noise & Odor
Noise Plan Has plan. 8/12/19
35 Odor Plan 4 3 Noise & Odor
Odor Plan, Odor Plan, 2 pages Has detailed plan, but no specs or budget. 8/12/19
Total Outreach 10 9
36 Stakeholder History
Proof of LARA Prequal 2 2 demo of reg prequalification Received prequalification letter dated 7/18/19 for Blackstone Harvest, LLC. 8/12/19
37 Demo of Regulatory
Compliance 5 5
https://bsaonline.com/SiteSearch/SiteSearchDetails?SearchFocus
=All+Records&SearchCategory=Address&SearchText=6450+s+ced
ar&uid=384&PageIndex=1&ReferenceKey=33‐01‐05‐10‐151‐
012&ReferenceType=0&SortBy=&SearchOrigin=0&RecordKeyDis
playString=33‐01‐05‐10‐151‐012&RecordKey=1%3d33‐01‐05‐10‐
151‐012%3a%3a4%3d33‐01‐05‐10‐151‐
012%3a%3a7%3d55b67cb1‐daee‐40e6‐9dae‐
9f2801426ce9%3a%3a13%3d4975&RecordKeyType=1%3d0%3a%
3a4%3d0%3a%3a7%3d2%3a%3a13%3d1
No code violations, no conditional denial letters. 9/12/19
38 Morals, Good Order & General
Welfare Litigation History 3 3 Morals Lit Hist Demo of Reg Has completed form(s) for all stakeholder(s). 9/12/19
Total Applicant
Stakeholder History 10 10
Total Score 100 73.50
2117
EXHIBIT
C
118
Smith-Zande, Jennifer
Wed, Oct 30, 5:04
PM
to jsteil902@gmail.com, me, Chris, Brian, Deb, Amanda, Heather
October 30, 2019
Blackstone Harvest LLC c/o Joann Steil
22618 Shorewood Dr. St Clair Shores, MI 48081
Dear Provisioning Center Applicant,
I have reviewed the report and recommendation of the hearing officer on your appeal of
the Scoring and Ranking denial of your application to operate a Medical Marihuana Provisioning Center in the City of Lansing at 6450 S Cedar St. I have determined that your appeal is denied.
You have the right to appeal this denial of licensure to the Medical Marihuana Commission
within thirty (30) days of the date of this letter by filing a written statement to the Commission with the City Clerk’s Office.
The Medical Marihuana Commission Appeal will become a matter of public record. The
Commission’s review of the appeal shall not be de novo. The Commission shall only
overturn, or modify, a decision or finding of the Clerk if it finds such decision or finding to be arbitrary or capricious and not supported by material, substantial, and competent facts on the whole record considered by the Clerk in arriving at such decision or finding.
Chapter 1300 provides that should the applicant not receive a license, one-half the
application fee shall be returned. This refund will be processed after all appeals are exhausted.
If you have begun business operations pursuant to State Emergency Rule 19 and
Executive Order 2017-02, you must cease operations. Operations may resume only if your appeal is granted and the requirements of licensure are satisfied.
Sincerely,
Chris Swope, CMMC City Clerk
cc: M. Yankowski, Lansing Police Chief
J. Smiertka, Lansing City Attorney
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EXHIBIT
D
120
City of Lansing
Hearing Officer Recommendation
In Re:
Blackstone Harvest, LLC
Proposed Location: 6450 S. Cedar St.
Provisioning Center License Denial
This recommendation is remitted to the Clerk of the City of Lansing by Hearing Officer Amanda
M. Brzezinski, Esq., having reviewed the facts and issues presented upon appeal of medicalmarihuana provisioning center licensure denial by BLACKSTONE HARVEST, LLC under theLansing Medical Marihuana Ordinance Chapter 1300 (Chapter 1300). Chapter 1300.15(c)directs that upon notice of denial of licensure applicants may appeal to the City Clerk who shall
appoint a hearing officer to hear and evaluate the appeal and submit a recommendation to the
Clerk. The recommendation of the Hearing Officer in the aforementioned matter is that thelicense application for BLACKSTONE HARVEST, LLC remain denied.
FACTS
BLACKSTONE HARVEST, LLC (“Appellant”) applied to the City of Lansing for a license to
operate a Medical Marihuana Provisioning Center within the city limits. This recommendation
follows a timely appeal from Appellant.
An email dated September 20, 2019, from the City Clerk’s office was sent to the Appellant providing notice of the license application denial, having received a score of 73.5 out of a possible 100 points, eliminating Appellant from top five scoring and the possibility of
provisioning center licensure. Within the email sub-scores and their determining factors were provided, as well as a link to the Public Scoring Criteria and appeal rights, grounds, and instructions.
Appellant’s Position
Appellant disputes the denial on a basis that (1) the scoring is not based on competent, material, and substantial evidence; 2) scoring insights were based on clearly erroneous findings; 3) the score was based on improper/inconsistent scoring; 4) scoring methods do not comply with the ordinance; 5) scoring insights were inconsistent with the ordinance; 6) scoring decisions related
to Appellants application were arbitrary and capricious; and 7) scoring was based on an abuse of discretion.
City Clerk Position
The City Clerk affirms its position on the denial based on the Public Scoring Criteria,
Appellant’s Score Sheet with Scoring Insights, Appellant’s Application Copy with attachment
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2
lists for each section, and signed attestations. The City Clerk also asserts Chapter 1300.5(b) and the general legal standard that no right to cure exists upon appeal.
APPLICABLE LAW & REASONING
The issue is whether Appellant’s Provisioning Center License Application was erroneously
denied. The City of Lansing’s authority to issue licenses exists within its lawful police powers to regulate activities within the City, and it outlines the appellate procedure by ordinance within the City Charter.1
“The City Council shall provide, by ordinance, a procedure for the issuance of licenses and permits. The ordinance shall, to the greatest extent possible, place the responsibility for the issuance of licenses and permits under one official in order that persons requesting
specific licenses and permits will not have to contact more than one City office.”2
Here, the City has placed responsibility for Provisioning Center licensing with the City Clerk. Upon denial of a Provisioning Center License application, Chapter 1300.15(c) permits applicants to appeal the denial with the City Clerk, who shall appoint a Hearing Officer to evaluate the appeal and submit a recommendation to the Clerk. The Clerk will then review the
recommendation and report of the Hearing Officer and render a decision on the matter, which may be further appealed to the Medical Marihuana Commission for judicial review purposes.3 “The Commission's review of an appeal shall not be de novo. The Commission shall
only overturn, or modify, a decision or finding of the Clerk if it finds such decision or
finding to be arbitrary or capricious and not supported by material, substantial, and competent facts on the whole record considered by the Clerk in arriving at such decision or finding.”4 The Michigan Court of Appeals defined the arbitrary and capricious standard within Cona v.
Avondale: "'[A]rbitrary' means fixed or arrived at through an exercise of will or by caprice, without consideration or adjustment with reference to principles, circumstances or significance,
and 'capricious' means apt to change suddenly, freakish or whimsical. For instance, a
reason is arbitrary and capricious if it is based on prejudice, animus or improper motives."5
1 See LANSING CITY CLERK’S OFFICE, City of Lansing Charter (as amended) at 8-101.1-.2 (2019) available at:
https://library.municode.com/mi/lansing/codes/code_of_ordinances?nodeId=CHLAMI_ART8REPOCO_CH1LI_8-
102ISLI.
2 Id. at 8-102.
3 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.15(c).
4 Id. at 1300.03(e).
5 See Cona v Avondale Sch Dist, 303 Mich App 123; 842 NW2d 277 (2013).
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This recommendation will cogitate the arbitrary and capricious definition above when examining the submitted appeal for errors, prejudice, animus, or improper motives on the part of the City
Clerk in the denial of the Provisioning Center license. Appellant’s brief sections do not align with their seven assertions which serve as their basis for their appeal, so the Hearing Officer will consider Appellant’s brief sections which are tied to the
scoring sections of the Public Scoring Criteria Sheet.
Financial Structure & Financing (Section 10) Appellant contends that the City Clerk’s scoring determination was arbitrary and unreasonable, for only awarding 1 of 2 points possible within Section 10 “Financial Structure and Scoring” of
the Scoring Sheet for not including a startup budget with the application. Appellant points to Chapter 1300.05(b)(23) of the as the submission criteria for Section 10, when the Public Scoring Sheet and City of Lansing Medical Marihuana Facilities Application Checklist both stress that Section 10 scoring is rooted in Chapter1300.05(b)(12)(vii) of the Ordinance which states:
“(b)A complete application for a license or licenses required by this chapter shall be made under oath on forms provided by the City Clerk, and shall contain all of the following: … (12)A copy of the proposed business plan for the establishment, including, but not limited to, the following: … (vii)Financial structure and financing of the proposed medical marihuana establishment(s)”6
The Ordinance above clearly requires that a complete application be submitted to the City Clerk including but not limited to financial structure and financing. The Public Scoring Sheet Criteria also informs:
“Points awarded for evidence and explanation of the financial structure and financing for the proposed medical marijuana establishment(s) based upon (GAAP) general accepted accounting principles”7 The Public Scoring Sheet Criteria clearly advises applicants that points will be awarded for
evidence and explanation of the financial structure, and the burden is on the applicant to clearly present both evidence and an explanation, as to not leave the City Clerk’s office piecing together an applicant’s financial structure with assumptions. The burden was on the Appellant to explain with effectively presented evidence that the larger first year budget was due to the inclusion of
startup costs, not upon the Clerk to inherently know the detail of Appellant’s business plan.
6 See LANSING CITY CLERK’S OFFICE, City of Lansing Charter (as amended) at 8-101.1-.2 (2019) available at:
https://library.municode.com/mi/lansing/codes/code_of_ordinances?nodeId=CHLAMI_ART8REPOCO_CH1LI_8-
102ISLI; City of Lansing Medical Marijuana Facilities Application Checklist, available at:
https://www.lansingmi.gov/DocumentCenter/View/7846/Medical-Marijuana-Facilities-Application-
Checklist?bidId=; City of Lansing Medical Marijuana Provisioning Center Scoring Criteria, available at:
https://www.lansingmi.gov/DocumentCenter/View/7907/Final-Phase-2-Criteria---June-14-2019?bidId=.
7 Id. Scoring Criteria.
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4
Startup costs are the expenses incurred during the process of creating a new business. These can be quite different from a typical annual budget, therefor it could be seen as an appropriate
measure to break them out in their own budget – especially when they are being reviewed by a city with many interests to balance within the licensing process. Essential to the startup effort is the creation of a business plan – a detailed map of the new
business to be created. A business plan forces consideration of the different startup costs for the
business. Underestimating expenses will falsely increase expected net profit. The Appellant states that the scorer’s determination was unreasonable. The granting of limited availability licenses to best-scoring applicants, in an effort to ensure successful businesses within the city limits, is reasonable with the city keeping the best interests of the customers who will
rely upon the business in mind, as well as the City’s best interests in mind of a thriving community including business that will not draw upon City resources due to incomplete planning, but will instead contribute to the area’s success.
Appellant’s exhibit’s 3, 4 and 5 will not be considered for Section 10 within this
recommendation as they were not submitted with Section 10 on the application and no efforts to cure application deficiencies on appeal are permissible per Chapter 1300.5(b) stating “A complete application for a license or licenses required by this chapter shall be made…” and general state appellate practice; review available on appeal is to the record originally submitted and reviewed.8
Integration with Grows (Section 12) & Total COL Jobs (Section 20) Zero points were awarded to Appellant in Section 12 of the Scoring Sheet. The Provisioning
Center Scoring Criteria points applicants to Chapter1300.05(b)(12)(ix) which states:
“If a medical marihuana grower facility(ies) are proposed, plans to integrate such facility(ies) with other proposed medical marihuana establishments and a statement whether the medical marihuana grower facility will grow 1,000 plants or more and the square footage of the building(s) housing such grower facility, and if so, will the facility
contain more than 10,000 square feet of space;”9 The Public Scoring Sheet Criteria states:
“Points awarded for evidence which documents ownership of licensed (or pending
application for) medical marijuana grow operations within the City of Lansing.” Appellant did submit an Integration Plan with their application which stated they will own a grow, but no applications for a grow had been submitted which led the Clerk to deem the statement speculative as it had no accompanying supporting evidence. Exhibits 8 and 9 cannot be
considered as supporting evidence of Appellant’s intent as they were not submitted with the correct section of the initial application as specifically instructed within the application
8 See Napier v. Jacobs, 429 Mich. 222, 232-35 (1987).
9 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.05(b)(12)(ix).
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5
instructions. As discussed above, there is no right to cure upon appeal. With numerous applicants, and one Clerk with other duties, applicants must heed and follow instructions.
Appellant points to Exhibit 10, an application submitted for a Grower Facility submitted on October 2, 2019 well after notice from the City Clerk that the Provisioning Center License Application was denied (September 20, 2019).
Section 20 points applicants to Chapter 1300.05(b)(12)(v) which states the proposed business
plan shall be submitted with: “Expected job creation from the proposed medical marihuana establishment(s)”10 The Scoring Criteria advises that points shall be awarded for the:
“Number of additional jobs created by your stakeholders within the City of Lansing at other medical marijuana facilities types (Grower/Processor).”11
Since the Appellant had not submitted a Grower Facility application until well after the license
application was reviewed, it is reasonable and appropriate to find the number of additional jobs created by Appellant’s stakeholders within the City at other medical marijuana facilities speculative and the zero points awarded are affirmed. The Scoring Criteria made available to the public states that incomplete plans will be awarded zero points.
Projected Annual Budget (Section 19) The Medical Marijuana Provisioning Centers Scoring Criteria sheet that is available to the public states that the ordinance source for Section 19 is Chapter 1300.05(b)(23):
“An estimate of the number and type of jobs that the medical marihuana establishment is expected to create, the amount and type of compensation expected to be paid for such jobs, and the projected annual budget and revenue of the medical marihuana establishment.”12
The Public Scoring Criteria advises that points will be awarded for providing the: “Projected annual budget and revenue based upon (GAAP) generally accepted accounting principles”13
The City Clerk states on the Scoring Insights that no startup budget was included within this section of the application. As discussed above regarding the lack of submitting appropriate documentation and evidence, in this case a startup budget, can reasonably lead to zero points being awarded in a scoring category.
10 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.05(b)(12)(v).
11 City of Lansing Medical Marijuana Provisioning Center Scoring Criteria.
12 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.05(b)(23).
13 City of Lansing Medical Marijuana Provisioning Center Scoring Criteria.
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6
Appellant points to exhibit 6, supporting materials that were provided within the application upon submission but again, they were not attached within the correct, corresponding application
section and therefore were not considered for scoring in that section and now cannot be considered as an attempt to cure upon appeal.
Net Worth (Section 22)
Provisioning Centers Scoring Criteria cites four areas as its ordinance source. The first is MCL333.27402(3)(a) which states: “(3) In determining whether to grant a license to an applicant, the board may also consider all of the following: (a) The integrity, moral character, and reputation; personal
and business probity; financial ability and experience; and responsibility or means to operate or maintain a marihuana facility of the applicant and of any other person that meets either of the following: (i) Controls, directly or indirectly, the applicant. (ii) Is controlled, directly or indirectly, by the applicant or by a person who controls, directly or
indirectly, the applicant.”14
Appellate contends that there was an error in not awarding any of the possible three points in this section. Appellant submitted a detailed “personal” financial statement from her CPA. Appellant’s Exhibit 12 does show the financial state of a Joann Stiel, but no mention is made of BLACKSTONE HARVEST LLC who is the license applicant. Nor any supporting evidence of
Appellant’s claim that BLACKSTONE HARVEST LLC is solely owned and operated by Ms. Stiel. Without more evidence and explanation presented within this section of the application, it is reasonable and prudent to not assume a connection. Exhibit’s 13, 14 and 15 cannot be considered as they were not attached to this section of the application as supporting evidence.
The Provisioning Centers Scoring Criteria next points to Chapter 1300.05(b)(12)(vii) which states: “Financial structure and financing of the proposed medical marihuana establishment(s)”15
Applicant received no points allocated for omitting to provide a startup budget as discussed earlier. Of note is the corresponding Scoring Criteria description “CPA Attestation of Net Worth or Bank Statements Supporting Initial Start‐Up and Operating Costs” which specifically call out the need to clearly show initial startup costs.
The third citation of the Section 22 ordinance source is Chapter 1300.05(b)(22): “Verification, including copies of actual bank statements, showing that the applicant has minimum net worth of $100,000.00 in the applicant's name.”16
14 MMFLA, MCL § 333.27402(3)(a).
15 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.05(b)(12)(vii).
16 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.05(b)(22).
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This distinctly points out that the applicant is to have the net worth documentation in the applicant’s name. Here, the applicant is BLACKSTONE HARVEST LLC.
The final citation of the Section 22 ordinance source is Chapter 1300.06(b)(5) which directs the City Clerk to assess:
“Whether the applicant has reasonably and tangibly demonstrated it possesses sufficient
financial resources to fund, and the requisite business experience to execute, the submitted business plan and other plans required by Section 1300.05.”17
Appellant did not reasonably and tangibly demonstrate BLACKSTONE HARVEST LLC possessed sufficient financial resources due to the lack of clarity and thorough explanation in the
application and materials attached within that section. No points shall be awarded for assumptions and the drawing of conclusions on the applicant’s behalf.
Odor Plan (Section 35)
The Provisioning Centers Scoring Criteria states up to four points will be awarded for:
“Any plan(s) the applicant has provided which would minimize or eliminate the impact of increased odor on nearby neighborhoods. Please document in budget of expenditures.”18
Chapter 1300.06(b)(3) states:
“Planned outreach on behalf of the proposed establishment, and whether the applicant or
its stakeholders have made, or plan to make, significant physical improvements to the
building housing the medical marihuana establishment, including plans to eliminate or minimize traffic, noise, and odor effects on the surrounding neighborhood.”19
Chapter 1300.09(i) states:
“No medical marihuana provisioning center shall be operated in a manner creating noise, dust, vibration, glare, fumes, or odors detectable to normal senses beyond the boundaries of the property on which the medical marihuana provisioning center is operated; or any other nuisance that hinders the public health, safety and welfare of the residents of the
City.”20
The City Clerk awarded 3 of a possible 4 points for this section because the applicant did not provide specifications and documentation of the odor plan that was submitted within a budget attached in the section of the application which is requested within the Scoring Criteria.
17 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.06(b)(5).
18 City of Lansing Medical Marijuana Provisioning Center Scoring Criteria.
19 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.06(b)(3).
20 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.09(i).
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Appellant’s reference to Exhibit 2 is inappropriate as the Exhibit was not attached within this section of the application.
CONCLUSION
After reviewing the following:
1. Appellant’s brief and the Exhibits that were initially attached to the appropriate,corresponding application sections,2. The City Clerk’s Statement of Facts3. The Lansing Medical Marihuana Ordinance Chapter 13004. The Provisioning Centers Scoring Criteria
5. The Signed Application for Provisioning Center with Attachments Listed andAttestations6. Proof of Payment for Grow with Submission Date Highlighted7. Proof of Application Date for Grow
8. Proof of Denial Date for Provisioning Center
9. General Instructions for Submitting Application10. The Public Criteria11. LARA’s Advisory Bulletin on CPA Attestations12. The American Institute of CPAs Definition of Compilation
The recommendation of the Hearing Officer formed above is that Appellant’s application for a Provisioning Center License remain denied.
Respectfully Submitted,
/s/ Amanda M. Brzezinski Amanda M. Brzezinski, Esq., Hearing Officer P83413
5200 Chinook Ln. Lyons, MI 48851 Ph: 517.898.3676 Mandy.Brzezinski@gmail.com
Dated: October 24, 2019
128
City of Lansing Provisioning Center Ranking 10/30/2019 4:16 PM
Total
Possible
Points
Blackstone Harvest LLC - District Club-6450 S. Cedar
Applicant Address ---
#Category ---Score Location of material Scoring Insights
1 Ownership Structure 1 1 Org Docs, Ownership Struc., 1 pg.Has structure. 8/12/19
2 Organizational Chart 1 1 Org Docs, Org Chart, 6 pgs.Has org chart. 8/12/19
3 Worker Training Program 1 1 OtherReqDocs, Worker Training Plan, 95 pgs.Has plan. 8/12/19
4 Short and Long Term Goals and
Objectives 1 1 Org Docs, Goals, 71 pgs.Has goals. 8/12/19
5 Community Outreach &
Education 1 1 Community Outreach, Outreach&Ed, 7 pgs. Has plan. 8/12/19
6 Marketing, Advertising &
Promotion 3 3 Marketing Five examples of minor minimization with good detail. Includes marketing materials. Includes budget.
7/9/19
7 Tangible Capital Investment
Dollar Amount 5 5 4 page Investment Plan in TCI section Calculated $4,883,250 TCI from narrative. 8/12/19
8 Tangible Capital Investment
Own/Lease 3 3 19 pages in Lease with Permission in TCI Folder Stakeholder owns the property. 8/12/19
9 Tangible Capital Investment
Supporting Material 3 3 47 pages in TCI Supporting Documents Has supporting materials which fully corroborate stated/calculated TCI. 8/12/19
10 Financial Structure & Financing 2 1 Job Creation, Budget Revenue 1 page and Finance, Startup Costs
Budget 1 page 3 year budget with revenue and line item expenses. No startup budget attached. 8/21/19
11 LARA Pre-Qual 3 3 demo of reg prequalification Received prequalification letter dated 7/18/19 for Blackstone Harvest, LLC. 8/12/19
12 Integration with Grows 4 0 Integration
Integration Plan
Integration plan says they will have grow, but does not have any application(s) submitted. Deemed
speculative. 9/20/19
13 Charitable Plans & Strategies 4 3 Charitable
Charitable Plan Plans to contribute $125K in cash and $10K in volunteer time. No receipts or agreements. 8/12/19
14 Number of and job descriptions
for PC ONLY 3 3 Job Creation
FTE's 34-40 FTE's at PC. Job descriptions with adequate detail. 8/12/19
15 Healthcare 2 2 Job Creation
Healthcare Employer will provide healthcare. 8/12/19
16 Paid Time Off 1 1 Job Creation
Healthcare Employer will provide paid time off. 9/12/19
17 Retirement 1 1 Job Creation
Healthcare Employer will provide 401K or similar plan. 8/12/19
18 % of employees at $15+/hr 3 3 Job Creation
Plus 15 100% of employees will make $15+/hr. 8/12/19
19 Projected Annual Budget 2 1 Job Creation, Budget Revenue 1 page and Finance, Startup Costs
Budget 1 page 3 year budget with revenue and line item expenses. No startup budget attached. 8/21/19
20 Total COL Jobs 6 0 Job Creation
Lansing Jobs Has not submitted application for grow, therefore jobs are speculative 9/16/19
Total Business Plan &
Job Creation 50 37
21 Financial Litigation History 1 1 Financial Litigation History Form Financial Litigation History Form submitted on sole stakeholder. 7/10/19
22 Net Worth 3 0 6 pages in Financial Section of Laserfiche
Doesn’t have $100K in a bank account in the applicant’s name.
Doesn’t have solid proof of net worth. No submitted document in name of applicant. 9/16/19
Doesn’t have full documentation of initial start-up and operating costs. 9/12/19
23 LARA Pre-Qual 3 3 demo of reg prequalification Received prequalification letter dated 7/18/19 for Blackstone Harvest, LLC. 8/12/19
24 Stakeholder Experience
City of Lansing Businesses 1 0 Experience Stakeholder Resume Resume does not list any Lansing business ownership. 7/12/19
25 Stakeholder Experience
Relevant Businesses 1 1 Experience Stakeholder Resume Sole stakeholder has 18 years experience in a medical related field. 7/12/19
26 Stakeholder Experience
Medical Marijuana Business 1 0 Experience Stakeholder Resume Sole stakeholder did not list any medical marijuana related experience. 7/12/19
Total Financial Stability
&
Business Experience
10 5
1129
City of Lansing Provisioning Center Ranking 10/30/2019 4:16 PM
27 Impact on Neighborhood
Distance Between PC &
Residential Zoning
7 5
https://lansing.maps.arcgis.com/apps/webappviewe
r/index.html?id=be0634345255438ba55b14c9b19e9f
22
PC has residential zoned property within 1/4 mile. 9/20/19
28 Impact on Neighborhood
Density of PCs 7 1.5
https://lansing.maps.arcgis.com/apps/webappviewe
r/index.html?id=be0634345255438ba55b14c9b19e9f
22
Lose 2 points for every existing PC within a 1/2 mile radius. None
Lose 1 point for every existing PC within a 1 mile radius. #5, #9, #10, #11, #13
Lose .5 point for every existing PC within a 1.5 mile radius.#2
Lose .25 point for every existing PC within a 2 mile radius. None
Lost 5.5 points. 8/12/19
29 Traffic & Parking 3 3 Public Service Review Tier 1 plan. Excellent parking/circulation. 8/30/19
30 Security Plan 3 3 LPD Review Tier I - bank vault, on site guard, alarm system w/ color printer, panic button, off site video storage,
Man trap barrier, equipment specs 8/20/19
Total - Land Use &
Resident Safety 20 12.50
31 Planned Outreach 1 1 Community Outreach, Outreach&Ed, 7 pgs. Has plan. 8/12/19
32 Improvements to Building 3 3 Building Improvements
Support Docs
SEV-$280,600
Proposed Improvements $643,250.00 - 229% of SEV
Has proposal from ZA Design Build which supports that amount. 8/26/19
33 Plan to Minimize Traffic 1 1 Traffic Study, Neighborhood Compatibility & Plans to minimize
traffic 10pgs total Has a plan. 9/12/19
34 Noise Plan 1 1 Noise & Odor
Noise Plan Has plan. 8/12/19
35 Odor Plan 4 3 Noise & Odor
Odor Plan, Odor Plan, 2 pages Has detailed plan, but no specs or budget. 8/12/19
Total Outreach 10 9
36 Stakeholder History
Proof of LARA Prequal 2 2 demo of reg prequalification Received prequalification letter dated 7/18/19 for Blackstone Harvest, LLC. 8/12/19
37 Demo of Regulatory
Compliance 5 5
https://bsaonline.com/SiteSearch/SiteSearchDetails?SearchFocus=
All+Records&SearchCategory=Address&SearchText=6450+s+cedar
&uid=384&PageIndex=1&ReferenceKey=33-01-05-10-151-
012&ReferenceType=0&SortBy=&SearchOrigin=0&RecordKeyDisplayString=33-01-05-10-151-012&RecordKey=1%3d33-01-05-10-151-
012%3a%3a4%3d33-01-05-10-151-012%3a%3a7%3d55b67cb1-
daee-40e6-9dae-
9f2801426ce9%3a%3a13%3d4975&RecordKeyType=1%3d0%3a%3
a4%3d0%3a%3a7%3d2%3a%3a13%3d1
No code violations, no conditional denial letters. 9/12/19
38 Morals, Good Order & General
Welfare Litigation History 3 3 Morals Lit Hist Demo of Reg Has completed form(s) for all stakeholder(s). 9/12/19
Total Applicant
Stakeholder History 10 10
Total Score 100 73.50
2130
EXHIBIT
E
131
In re: BLACKSTONE HARVEST, LLC
Applicant
/
APPLICANT’S APPEAL TO THE MEDICAL MARIJUANA COMMISSION FOR
DENIAL OF PROVISIONING CENTER LICENSE
Entity: Blackstone Harvest, LLC
Proposed Location: 6450 S. Cedar St., Lansing, MI 48911
INTRODUCTION
Blackstone Harvest, LLC (“Applicant”) submitted its application for a license to operate
a medical marijuana provisioning center at 6450 S. Cedar St., Lansing, Michigan on June 26,
2019. On September 20, 2019, an e-mail denying Applicant’s application was sent by the City
Clerk’s office. Per the correspondence, Applicant received a score of 73.50 out of 100. As was
justified, Applicant timely appealed the City of Lansing’s decision in accordance with Chapter
1300.15(C).
The City Clerk appointed Amanda M. Brzezinski as the hearing officer for review of
Applicant’s appeal. On October 30, 2019, the City Clerk, after reviewing the report and
recommendation of the hearing officer, determined that Applicant’s appeal was denied.
The Applicant timely submits this appeal to the Medical Marijuana Commission in accordance
with Chapter 1300.15(C).
CHAPTER 1300.15(C)
The applicable ordinance states:
1300.15 – LICENSE REVOCATION; BASES FOR REVOCATION; APPEAL OF
LICENSE DENIAL
(C) APEAL OF DENIAL OF AN APPLICATION OR REVOCATION OF A LICENSE:
The city clerk shall notify an applicant of the reason(s) for denial of an application for a license
or license renewal or for revocation of a license or any adverse decision under this chapter and
provide the applicant with the opportunity to be heard. Any applicant aggrieved by the denial or
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revocation of a license or adverse decision under this chapter may appeal to the city clerk, who
shall appoint a hearing officer to hear and evaluate the appeal and make a recommendation to the
clerk. Such appeal shall be taken by filing with the city clerk, within 14 days after notice of the
action complained of has been mailed to the applicant’s last known address on the records of the
city clerk, a written statement setting forth fully the grounds for the appeal. The clerk shall
review the report and recommendation of the hearing officer and make a decision on the matter.
The clerk’s decision may be further appealed to the commission if applied for in writing to the
commission no later than thirty (30) days from the clerk’s decision. The review of an appeal or
denial or revocation or adverse action shall be by the commission pursuant to section 1300.3.
Any decision by the commission on an appeal shall be final for purposes of judicial review. The
clerk may engage professional experts to assist with the proceedings under this section 1300.15.
CHAPTER 1300.3(E)
Chapter 1300.3 states, in pertinent part:
1300.3 – ESTABLISHMENT OF THE MEDICAL MARIHUANA COMMISSION;
MEMBERSHIP; CHAIRPERSON; MEETINGS
(E) The commission shall review and decide all appeals that are forwarded to it by the city clerk
under this chapter. The commission’s review of an appeal shall not be de novo. The commission
shall only overturn, or modify, a decision or finding of the clerk if it finds such decision or
finding to be arbitrary or capricious and not supported by material, substantial, and competent
facts on the whole record considered by the clerk in arriving at such decision or finding.
STANDARD OF REVIEW
The review of an appeal shall not be de novo. The commission shall only overturn, or
modify, a decision or finding of the clerk if it finds such decision or finding to be arbitrary or
capricious and not supported by material, substantial, and competent facts on the whole record
considered by the clerk in arriving at such a decision or finding.
Arbitrary means “without adequate determining principle… fixed or arrived at through an
exercise of will or by caprice, without consideration or adjustment with reference to principles,
circumstances, or significance… decisive but unreasoned.” Capricious means “apt to change;
suddenly; freakish; whimsical; humorsome.” Bundo v Walled Lake, 395 Mich 679, 703, n17; 238
N.W.2d 154 (1976) citing the United States Supreme Court decision of United States v Carmack,
329 US 230, 243; 67 S Ct 252; 91 L Ed 209 (1946). Moreover, the term “arbitrary,” has been
133
defined by Michigan Eastern District Federal Court Judge Laurie Michelson, using Black’s Law
Dictionary as “not supported by fair, solid, and substantial cause, and without reason given.”
Cerjanec v FCA US LLC, 2018 US Dist LEXIS 131434 (Decided August 6, 2018) (ED MI
2018).
Further, the applicable standard requires a review of whether the decision is supported by
competent, material, and substantial evidence on the record, and represents the reasonable
exercise of the board’s discretion. “Substantial evidence” is evidence that a reasonable person
would accept as sufficient to support a conclusion. Edw C Levy Co v. Marine City Zoning Bd of
Appeals, 293 Mich App 333, 341-42; 810 N.W.2d 621 (2011) (quoting Dowerk v Charter Tp of
Oxford, 233 Mich App 62, 72; 592 N.W.2d 724 (1998)). Furthermore, scoring must be proper,
consistent, comply with the applicable ordinances, and not be based upon an abuse of discretion.
BASIS OF APPEAL
The basis for this appeal is 1) the scoring is not based on competent, material, and
substantial evident; 2) scoring insights provided to applicant are based on clearly erroneous
findings; 3) Applicant’s score was based on improper/inconsistent scoring; 4) scoring methods
do not comply with the ordinance; 5) scoring insights were inconsistent with the ordinance; 6)
scoring decisions related to Applicant’s application were arbitrary and capricious; 7) the scoring
was not supported by material, substantial, and competent facts on the whole record considered
by the clerk; and 8) scoring was based upon an abuse of discretion.
STATEMENT OF FACTS
Blackstone Harvest, LLC (“Blackstone”) is a state prequalified entity pursuant to the
licensing provisions of the Medical Marihuana Facilities Licensing Act (MMFLA) and
Administrative Rule 5 (R 333.205). Blackstone is owned by a single member, Joann Steil, who
has over fifteen years of experience in the health care industry. Ms. Steil has successfully owned
134
and operated a health care case management company called Advanced Placement Services. She
works in collaboration with physicians, patients, and their families to ensure safe and efficient
transitions of care.
Blackstone recently applied for a provisioning center license with the City of Lansing
under its ordinance and in accordance with the MMFLA. Blackstone also applied for a medical
marijuana grower facility license in the City of Lansing. Blackstone was a qualified applicant
that submitted complete documentation for all categories considered for scoring.
A full review of the application would corroborate that the denial of Blackstone’s
application in Lansing is unjustifiable because 1) plans and documentation submitted by
Blackstone were ignored or poorly reviewed, and/or 2) the City did not follow its own guidance
on scoring in accordance with the applicable rules and ordinances and made reversible errors
based upon an abuse of discretion and arbitrary and capricious decision making.
On June 26, 2019, Blackstone submitted its City of Lansing Medical Marijuana
Application for a provisioning center (the “Application”). The City of Lansing accepted the
Application and the application fees were paid and deemed accepted by the city that same day.
The Application consisted of over 125 attachments, which provided detailed
documentation related to the proposed building, operational plans, staffing plans, security plans,
facility plans, and floor plans, among other required documents. The Application covered all
aspects of Lansing’s scoring rubric and was consistent with the Lansing ordinance.
Per the application, Blackstone submitted proof of purchase related to the proposed
property located at 6450 S. Cedar 5031 S. Cedar St., Lansing, MI 48911. Blackstone has plans to
develop and operate a licensed medical marijuana provisioning center at the proposed property.
The total capital investment to purchase the property was $1,200,000.00. Per Blackstone’s
135
building development plan and construction plans, the renovation needed for 6450 S. Cedar
would cost an additional $643,250.00.
Blackstone submitted detailed plans related to its staffing at the proposed provisioning
center. Per the Application submitted, Blackstone will employ between 34 to 40 employees to
work at the provisioning center. Of those employees, approximately ten (10) employees will be
in a management or leadership position.
Blackstone is also purchasing a 13,600 sq. ft. property to integrate a grower facility with
the proposed provisioning center. This grower facility will have a Class C grow license that will
allow a 1,500-plant grow operation. The property Blackstone is purchasing is commonly known
as 209 Baker Street, Lansing, MI 48910. A valid purchase agreement for the Baker property was
provided, and subsequent to the filing of the provisioning center application, Blackstone
submitted a grow application in relation to the Baker property. The total capital investment to
purchase Baker was $1,000,000.00, and the estimated additional investment to renovate the
interior and exterior of the Baker building was $2,040,000.00.
In total, Blackstone submitted that it would create between 84 and 100 new jobs in the
City of Lansing between its proposed provisioning center and proposed medical marijuana
grower facility. The plans to staff and employ residents of Lansing would have a profound effect
on the local economy.
Despite submitting a complete and well-supported application to the City of Lansing
detailing Blackstone’s proposals, budgets, and operational plans, on September 20, 2019,
Blackstone received correspondence from the City of Lansing stating that Blackstone had not
been selected to receive a provisioning center license at the proposed location of 6450 S. Cedar.
Per the correspondence, and the attached scoring rubric, Blackstone received a score of 73.50 out
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of 100. Consequently, the City of Lansing denied Blackstone the opportunity to receive
licensure, which was largely due to erroneous, arbitrary, inconsistent, and unreasonable scoring
of the Blackstone Application.
As of right, Blackstone hereby appeals the City of Lansing’s decision to deny the
Application in accordance with Chapter 1300.15(c).
DISCUSSION AND ARGUMENT
I. FINANCIAL STRUCTURE & FINANCING (Section 10)
The submission criteria refers applicants to Chapter 1300.05(b)(23), which states:
An estimate of the number and type of jobs that the medical marihuana establishment is expected to create, the amount and type of compensation expected to be paid for such jobs, and the projected annual budget and revenue of the medical marihuana establishment (emphasis added).
Blackstone was only awarded 1 out of 2 points for this scoring category. Exhibit 1 –
Scoring Rubric. The basis for the one-point deduction, per the scoring insights, was that a
“start-up budget [was] not attached.” Exhibit 1. The scorer’s determination is arbitrary and
unreasonable.
Nowhere in Chapter 1300.05(b)(23) is there a requirement to provide a “startup budget.”
Nevertheless, a startup budget and initial startup costs were included in the pro forma submitted
with the Application. See attached Exhibit 2 – Pro Forma. Per the scoring insights, the scorer
acknowledged review of the pro forma by stating: “submitted a 3-year GAAP budget with
revenue and line item expenses (“Pro Forma”).” Exhibit 2. Certainly, “startup costs” are under
the umbrella of “expenses.”
The Pro Forma clearly included specific line items for startup costs in the first year of
operation. Exhibit 2. Review of the Pro Forma demonstrates the following: 1) In year 1,
Blackstone expected initial capital investments of $1,843,250.00, which directly correlates with
137
both their purchase of the proposed location, as well as the documented construction costs; 2)
Blackstone identified initial startup costs for furniture and equipment in the amount of
$160,000.00; 3) Blackstone intended to have an initial spend on noise elimination and odor
elimination equipment in the total amount of $129,000.00; and 4) that wages in year 1 would
equate to $1,490,000.00. Exhibit 2. These figures clearly do not deviate from the “Tangible
Capital Investments” described in Blackstone’s Building Construction Plan, Land Contract for
the proposed property, as well as the Building Construction quotes provided as supporting
materials to the Application. See attached Exhibit 3 – Building Construction Plan; Exhibit 4
– Land Contract re Cedar St. Property; Exhibit 5 – Building Construction Quotes; Exhibit
6 – Tangible Capital Investment Plan. These figures also equally match Blackstone’s staffing
and job creation plan.
Even a cursory look at the Pro Forma depicts the vast difference for “expenses” in the
first year (approximately $4,200,000.00) in comparison to expenses in years two and three,
which were estimated at $2,508,000.00 and $2,301,000.00, respectively. Exhibit 2. The glaring
evidence of startup costs being included in the Pro Forma should not have been ignored by the
scorer. Thus, the decision was not supported by substantial evidence or reasonable exercise of
discretion.
The Pro Forma clearly included startup costs. Exhibit 2. Thus, the scorer’s determination
that a startup budget was not attached is unreasonable. The one-point deduction is a clear error.
This Section of the scoring rubric must be reconsidered, and Blackstone should be awarded a
total of 2 out of 2 points under this category.
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II. INTEGRATION WITH GROWS (Section 12) & TOTAL COL JOBS (Section 20)
Zero points were awarded for Section 12 and Section 20 of the scoring rubric. Exhibit 1.
Such a score is utterly unfathomable given the numerous supporting documents provided in the
Application.
In support of Section 12 of the scoring rubric, Blackstone submitted a Plan to Integrate
with a Grower Facility. See attached Exhibit 7 – Plan to Integrate with Grow. In fact, at the
time of Application submission, Blackstone had already entered into a signed purchase
agreement to purchase 209 Baker Street, Lansing, MI 48910. See attached Exhibit 8 –
Purchase Agreement re 209 Baker. The purchase price for the proposed grow was
$1,000,000.00. Exhibit 8. To support its plan to integrate, Blackstone included a copy of the
purchase agreement as an attachment to the Application as well as construction quotes for the
proposed grower facility. See attached Exhibit 9 – Construction Quotes for 209 Baker;
Exhibit 8. Entering into the purchase agreement for the 209 Baker property was an act in
furtherance of Blackstone’s plan to integrate with a grow. Moreover, Blackstone submitted an
application for a grower facility with the City of Lansing, which was yet another act in
furtherance of pursuing integration with a grower facility. See attached Exhibit 10 –
Application Submission Receipt. Additionally, obtaining construction quotes was another act in
furtherance of the plans to integrate. Exhibit 9. Under no circumstance, can these acts in
furtherance of moving forward with integration be deemed “speculative.”
Indeed, Blackstone has every intention of integrating a grow facility with its proposed
provisioning center. Blackstone did in fact eventually file its grow application with the City of
Lansing, which was never taken into consideration. Blackstone hereby requests that notice is
139
taken of Blackstone’s submitted grower application, which was filed with the City of Lansing
and is hereby fully incorporated by reference.
Moreover, the City of Lansing asked for plans of integration with a grower facility. Yet,
the scoring does not award points for having plans. Even if, assuming arguendo, that
Blackstone’s plan for integration lacked support and was merely “speculative,” then, at
minimum, Blackstone should have received points for submitting an integration plan in
accordance with the applicable ordinance. To award zero points completely undermines the
Lansing ordinance and falls completely out of the scorer’s allowable discretion. In contrast,
applicant was awarded points for submitting “plans” in other areas of the application – for
example, Blackstone received three out of four points for their charitable plan under Section 12
of the scoring rubric. The City cannot reasonably assert that plans in one category are
“speculative,” unless they assume that mere plans, in general, are always speculative. The
disfunction in scoring only sends one message, that scoring in this category was arbitrary,
capricious, and unreasonable.
In support of Section 20 of the scoring rubric, Blackstone submitted numerous job
creation plans that outlined not only jobs at the provisioning center, but also indicated the vast
number of jobs that would be created at the proposed grow facility Blackstone plans to integrate
with at the 209 Baker Property. See attached Exhibit 11 – Job Creation Plan. Again, under the
same logic the scorer used for Section 12, see supra, the scorer awarded zero points on the basis
that the grow facility was “speculative.” Exhibit 1. However, the scorer completely ignored the
fact that plans were submitted, and also ignored the totality of jobs that Blackstone intended to
bring to the City of Lansing. As indicated in the supporting documentation, Blackstone was fully
committed to implementing its hiring and staffing plans. Exhibit 11. At the integrated grow,
140
Blackstone had plans to hire over 50 employees. Exhibit 11. At the provisioning center,
Blackstone had plans to hire over 35 employees. Blackstone’s Pro Forma, as well as its staffing
and job creation plans, depicted a planned budget for such hiring. Exhibit 2; Exhibit 11.
When making its determination to award zero points for the above-referenced categories,
the decision of the scorer was arbitrary and unreasonable. The scorer’s inference that the grow
facilities were “speculative” is without basis. The supporting documentation certainly indicates
that Blackstone fully intends to integrate with a grow facility and that it took steps towards
accomplishing that plan. As such, these scores must be reconsidered and Blackstone should be
awarded, at minimum, 7 out of the 10 points available under these categories.
III. PROJECTED ANNUAL BUDGET (Section 19)
The scorer acknowledges, in the scoring insights section, that applicant included a “3-
year budget with revenue and line item expenses,” and then goes on to state that “no startup
budget attached.” This assertion is wrong. A start-up budget was incorporated into the Pro
Forma, which was acknowledged by the scorer. Exhibit 2. The Pro Forma clearly included
specific line items for startup costs in the first year of operation. For instance, the Pro Forma
indicates $1,843,250.00 allocated for “Capital Investments” in year 1. These figures clearly do
not deviate from the “Tangible Capital Investments” described in Blackstone’s Building
Construction Plan, as well as the Building Construction quotes provided as supporting materials
to the Application. Exhibit 6.
Additionally, the Pro Forma included line items for other startup costs such as “Noise
Elimination Equipment” and “Odor Elimination Equipment,” which were expenses to be
absorbed only within the first year of operation. Exhibit 2. Certainly, “start-up costs” are under
the umbrella of “expenses.” Even a cursory look at the Pro Forma depicts the vast difference for
141
“expenses” in the first year (approximately $4,200,000.00) in comparison to expenses in years
two and three, which collectively total less than $5,000,000.00. Exhibit 2. The glaring evidence
of startup costs being included in the Pro Forma cannot be ignored. Thus, the scorer’s
determination that a startup budget was not attached is unreasonable.
IV. NET WORTH (Section 22)
Blackstone was not awarded any of the three possible points in this scoring category.
Exhibit 1. The basis for the entire three-point deduction, per the scoring insights, was that
Blackstone “Doesn’t have $100K in a bank account in the applicant’s name. Doesn’t have solid
proof of net worth. No submitted document in name of applicant. Doesn’t have full
documentation of initial start-up and operating costs.” Exhibit 1. The scorer’s determination is
unreasonable.
The submission criterion for this scoring category refers applicants to section
1300.05(b)(12)(vii) and 1300.06(b)(5) which respectively state:
(12) A copy of the proposed business plan for the establishment, including, but not
limited to, the following:
(vii)Financial structure and financing of the proposed medical marihuana establishment(s) See Chapter 1300.05(b)(12)(vii).
* * * (5) Whether the applicant has reasonably and tangibly demonstrated it possesses sufficient financial resources to fund, and the requisite business experience to execute,
the submitted business plan and other plans required by Section 1300.05. The maximum
number of scoring points in this category shall be ten points. See Chapter 1300.06(b)(5).
Blackstone’s sole owner, Joann Steil, provided a detailed personal financial statement
from her CPA indicating a net worth of nearly $1,400,000.00, with available cash in excess of
142
$750,000.00. See attached Exhibit 12 – CPA Attested Financials. Ms. Steil is 100% owner of
Blackstone (a flow-thru entity), meaning that Ms. Steil and the entity are one and the same. See
attached Exhibit 13 – Ownership Structure; Exhibit 14 – Operating Agreement.
Additionally, Ms. Steil demonstrated that over $100,000.00 of liquid capital was
immediately available for capital contribution to Blackstone. See attached Exhibit 15 – Bank
Statements and Deeds; See attached Exhibit 16 – Financial Cover Page. Ms. Steil provided
detailed bank statements demonstrating there was sufficient cash at her disposal for contribution
to Blackstone. Exhibit 15. As such, point reductions in this category are unjustified.
The scorer deducted points claiming that there wasn’t solid proof of net worth despite the
fact that Ms. Steil’s CPA attestation specifically provided the necessary assurances, wherein the
CPA stated, “our responsibility is to conduct this engagement in accordance with Statements on
Standards for Attestation Engagements (SSAE)… We believe that the results of these procedures
provide a reasonable basis of our conclusion.” Exhibit 12. The CPA attested financials also state
that “based on the agreed upon procedures performed, we declare to the best of our knowledge,
the statement of financial condition of Joann Steil is complete and accurate.” Exhibit 12. The
decision to award 0 points is vastly unreasonable given Ms. Steil’s net worth and the supporting
documentation demonstrating that the entity was well capitalized.
Additionally, Blackstone provided Lansing with numerous supporting documents to
further provide assurance of its finances. The supporting materials included, bank statements,
annuity accounts and real estate deeds. Exhibit 15. The conclusions and decisions derived by the
score are arbitrary and unreasonable and are inconsistent with the supporting materials provided,
which if viewed reasonably, would have qualified Blackstone to receive all points under this
category.
143
Chapter 1300.06(b)(5) states that the City, as part of its scoring process, should consider
“whether the applicant has reasonably and tangibly demonstrated it possesses sufficient financial
resources…” The key word in this section of the ordinance is reasonably. It would be
completely unreasonable for the City to deduct points from Blackstone after its inclusion of the
numerous documents that corroborated Ms. Steil’s net worth and access to capital. This is in
addition to Ms. Steil signing a sworn statement as to the truth of this documentation and placing
her reputation, other business licenses, and livelihood at stake by doing so. See attached Exhibit
17 – Sworn Statement. Any objective person would find the documentation submitted by Ms.
Steil to be reasonable and that she did provide assurances of her financial ability and business
experience to operate this business.
In addition to the above, the scorer indicates that applicant failed to include a start-up
budget. This assertion is wrong. A start-up budget was included in the Pro Forma submitted
with the Application. Exhibit 2. Applicant included a 3-year Pro Forma which clearly included
a specific line items for startup costs in the first year of operation. For instance, the Pro Forma
indicates $1,843,250.00 allocated for “Capital Investments” in year 1. These figures clearly do
not deviate from the “Tangible Capital Investments” described in Blackstone’s Building
Construction Plan, as well as the Building Construction quotes provided as supporting materials
to the Application. Exhibit 6.
Additionally, the Pro Forma included line items for startup costs such as “Noise
Elimination Equipment” and “Odor Elimination Equipment,” which were expenses to be
absorbed only within the first year of operation. Exhibit 2. Certainly, “start-up costs” are under
the umbrella of “expenses.” Even a cursory look at the Pro Forma depicts the vast difference for
“expenses” in the first year (approximately $4,200,000.00) in comparison to expenses in years
144
two and three, which collectively total less than $5,000,000.00. The glaring evidence of startup
costs being included in the Pro Forma cannot be ignored. Thus, the scorer’s determination that a
startup budget was not attached is unreasonable.
Given that Blackstone clearly showed readily available funds in excess of $100,000, with
solid proof of net worth and clear evidence of start-up costs, the scorer’s decisions were made in
error, or were unjustified and unreasonable. In either event, Applicant must be awarded all
possible points in this category.
V. ODOR PLAN (Section 35) The submission criteria for this category refers applicants to Chapter 1300.06(b)(3) and
Chapter 1300.09(i). Chapter 1300.06(b)(3) states:
Planned outreach on behalf of the proposed establishment, and whether the applicant or its stakeholders have made, or plan to make, significant physical improvements to the
building housing the medical marihuana establishment, including plans to eliminate or
minimize traffic, noise, and odor effects on the surrounding neighborhood. The maximum number of scoring points in this category shall be ten point
Chapter 1300.09(i) states:
No medical marihuana provisioning center shall be operated in a manner creating noise,
dust, vibration, glare, fumes, or odors detectable to normal senses beyond the boundaries of the property on which the medical marihuana provisioning center is operated; or any other nuisance that hinders the public health, safety and welfare of the residents of the City.
Applicant was only awarded 3 of 4 points in this category, despite including a detailed
Odor Mitigation Plan. See attached Exhibit 18 – Odor Plan. The scorer, per the scoring
insights, based their decision on an unreasonable conclusion that the Odor Plan submitted did not
include “specs, or budget.” Exhibit 1. To the contrary, the Odor Plan submitted by Blackstone
included detailed equipment specs. Exhibit 18. Moreover, the Pro Forma submitted by
Blackstone clearly indicated a line item for Odor Equipment in the amount of $104,000.00.
Exhibit 2.
145
In addition, prior to submission of applications, the Clerk’s office provided applicants,
via the City’s website, a scoring rubric scoring guide with specific items to include to obtain
maximum points. See attached Exhibit 19 – Sample Rubric. In Section 35, “Plan to
Minimize/Eliminate Odor,” the criteria column states, “Any plan(s) the applicant has provided
which would minimize or eliminate the impact of increased odor on nearby neighborhoods
please document in budget of expenditures.” Here, Blackstone followed these instructions
precisely as requested and did, in fact, document the odor equipment cost in the budget of
expenditures, which is clearly listed as a separate line item in year 1 of the previously attached
Pro Forma. Exhibit 2. Adversely, the scorer deducted a point because the Odor Plan did not
include the cost of the equipment being proposed. Exhibit 1. However, the instructions clearly
stated to document said cost directly into the budget of expenditures, which applicant did based
upon a plain reading of the Lansing City Ordinance and other City materials. Exhibit 18.
The scorer also indicates that there were “no specs” provided for the odor equipment
being proposed. Exhibit 1. However, the attached Odor Plan, which was included as part of
Applicant’s application submission, includes specific details about the type of equipment to be
used. Exhibit 18. Specifically, Applicant’s Odor Plan provides a detailed description of the
equipment that will be used, including the type of system (mini-split), type of drive (belt),
amount of carbon (30 lbs), additional equipment (ozone generator), type of odor measuring
equipment (differential pressure gauge & Olfactometer), and type of comparative scale of
reference (OIRS - Odor Intensity Reference Scale). The main points of the Odor Plan have been
included here for your reference:
• The space will be conditioned using multiple split heat pump systems of various
capacities and a ductless mini-split system. Each of the split-systems, excluding the ductless mini-split system, are equipped with unit-level pleated filters.
146
• An in-line, belt driven exhaust fan is provided to remove the amount of fresh air provided for the occupants and an additional amount that will ensure a negative pressure within the
space.
• The in-line exhaust fan is equipped with a filter section loaded with approximately thirty pounds of activated carbon, in a rack-mounted configuration.
• An ozone generator will be placed upstream of the carbon filters, in the housing
assembly.
• A differential pressure gauge will be used to ensure a negative building static of no less than .05” of negative building static has been achieved. A maximum negative building
static shall not exceed .15”
• Testing shall be done using a field Olfactometer, calibrated in accordance with odor control standards using the scheduled monitoring protocol.
• We will compile and compare the data we record to establish norms using a 5-point Odor
Intensity Reference Scale to compare daily readings. The scorer’s determination that Applicant provided neither a budgeted cost nor any
specifics on the type of equipment proposed for this location cannot be possibly derived from the
materials submitted. Thus, the scorer’s decision should be deemed arbitrary and
unreasonable. Applicant clearly provided both aforementioned items with adequate sufficiency
and, as such, must be awarded one (1) additional point in this category.
CONCLUSION AND REQUESTED RELIEF
The scored rubric which applicant received with its denial is riddled with clear and
obvious errors and in some cases, direct contradictions made by the scorer.
It is also clear that the City of Lansing has decided to deduct points arbitrarily and
capriciously. As referenced above, many of the deductions were non-objective, unreasonable,
and without basis under the requirements set forth in the City of Lansing’s applicable ordinances.
These numerous errors and blatant disregard for the requirements set forth in the ordinance
bolster Applicant’s claims that the scoring was arbitrary and capricious; and was not supported
147
by material, substantial, and competent facts on the whole record considered by the Clerk.
Applicant maintains that the entire application needs to be re-scored with the additional points
outlined above being added to Blackstone’s score.
Blackstone hereby reserves all rights. Additionally, the Exhibits attached hereto are not
meant to replace the application, or the totality of documents submitted in support of each
category of scoring. Blackstone hereby incorporates its entire Application, as well as its grower
application fully by reference herein.
Respectfully submitted,
/s/ Nadeem Noah Harfouch /s/ Mike M. Bahoura
Nadeem Noah Harfouch, Esq. Mike M. Bahoura, Esq. The Harfouch Law Firm, PLLC Law Offices of Mike M. Bahoura, PLLC 631 East Big Beaver Road, Suite 211 631 East Big Beaver Road, Suite 211 Troy, MI 48083 Troy, MI 48083
Ph: 248-274-6529 Ph: 248-392-1586
nharfouch@harfouchlaw.com mike@bahouralaw.com Dated: November 27, 2019 Dated: November 27, 2019
148
EXHIBIT
1
Scoring Rubric, as scored by the Clerk
149
City of Lansing Provisioning Center Ranking 9/20/2019 3:51 PM
Total
Possible
Points
Blackstone Harvest LLC ‐ District Club‐6450 S. Cedar
Applicant Address ‐‐‐
#Category ‐‐‐Score Location of material Scoring Insights
1 Ownership Structure 1 1 Org Docs, Ownership Struc., 1 pg.Has structure. 8/12/19
2 Organizational Chart 1 1 Org Docs, Org Chart, 6 pgs.Has org chart. 8/12/19
3 Worker Training Program 1 1 OtherReqDocs, Worker Training Plan, 95 pgs.Has plan. 8/12/19
4 Short and Long Term Goals and
Objectives 1 1 Org Docs, Goals, 71 pgs.Has goals. 8/12/19
5 Community Outreach &
Education 1 1 Community Outreach, Outreach&Ed, 7 pgs. Has plan. 8/12/19
6 Marketing, Advertising &
Promotion 3 3 Marketing Five examples of minor minimization with good detail. Includes marketing materials. Includes
budget. 7/9/19
7 Tangible Capital Investment
Dollar Amount 5 5 4 page Investment Plan in TCI section Calculated $4,883,250 TCI from narrative. 8/12/19
8 Tangible Capital Investment
Own/Lease 3 3 19 pages in Lease with Permission in TCI Folder Stakeholder owns the property. 8/12/19
9 Tangible Capital Investment
Supporting Material 3 3 47 pages in TCI Supporting Documents Has supporting materials which fully corroborate stated/calculated TCI. 8/12/19
10 Financial Structure & Financing 2 1 Job Creation, Budget Revenue 1 page and Finance, Startup Costs
Budget 1 page 3 year budget with revenue and line item expenses. No startup budget attached. 8/21/19
11 LARA Pre‐Qual 3 3 demo of reg prequalification Received prequalification letter dated 7/18/19 for Blackstone Harvest, LLC. 8/12/19
12 Integration with Grows 4 0 Integration
Integration Plan
Integration plan says they will have grow, but does not have any application(s) submitted. Deemed
speculative. 9/20/19
13 Charitable Plans & Strategies 4 3 Charitable
Charitable Plan Plans to contribute $125K in cash and $10K in volunteer time. No receipts or agreements. 8/12/19
14 Number of and job
descriptions for PC ONLY 3 3 Job Creation
FTE's 34‐40 FTE's at PC. Job descriptions with adequate detail. 8/12/19
15 Healthcare 2 2 Job Creation
Healthcare Employer will provide healthcare. 8/12/19
16 Paid Time Off 1 1 Job Creation
Healthcare Employer will provide paid time off. 9/12/19
17 Retirement 1 1 Job Creation
Healthcare Employer will provide 401K or similar plan. 8/12/19
18 % of employees at $15+/hr 3 3 Job Creation
Plus 15 100% of employees will make $15+/hr. 8/12/19
19 Projected Annual Budget 2 1 Job Creation, Budget Revenue 1 page and Finance, Startup Costs
Budget 1 page 3 year budget with revenue and line item expenses. No startup budget attached. 8/21/19
20 Total COL Jobs 6 0 Job Creation
Lansing Jobs Has not submitted application for grow, therefore jobs are speculative 9/16/19
Total Business Plan &
Job Creation 50 37
21 Financial Litigation History 1 1 Financial Litigation History Form Financial Litigation History Form submitted on sole stakeholder. 7/10/19
22 Net Worth 3 0 6 pages in Financial Section of Laserfiche
Doesn’t have $100K in a bank account in the applicant’s name.
Doesn’t have solid proof of net worth. No submitted document in name of applicant. 9/16/19
Doesn’t have full documentation of initial start‐up and operating costs. 9/12/19
23 LARA Pre‐Qual 3 3 demo of reg prequalification Received prequalification letter dated 7/18/19 for Blackstone Harvest, LLC. 8/12/19
24 Stakeholder Experience
City of Lansing Businesses 1 0 Experience Stakeholder Resume Resume does not list any Lansing business ownership. 7/12/19
25 Stakeholder Experience
Relevant Businesses 1 1 Experience Stakeholder Resume Sole stakeholder has 18 years experience in a medical related field. 7/12/19
26 Stakeholder Experience
Medical Marijuana Business 1 0 Experience Stakeholder Resume Sole stakeholder did not list any medical marijuana related experience. 7/12/19
Total Financial Stability
&
Business Experience
10 5
27
Impact on Neighborhood
Distance Between PC &
Residential Zoning
7 5
https://lansing.maps.arcgis.com/apps/webappviewe
r/index.html?id=be0634345255438ba55b14c9b19e9f
22
PC has residential zoned property within 1/4 mile. 9/20/19
1150
City of Lansing Provisioning Center Ranking 9/20/2019 3:51 PM
28 Impact on Neighborhood
Density of PCs 7 1.5
https://lansing.maps.arcgis.com/apps/webappviewe
r/index.html?id=be0634345255438ba55b14c9b19e9f
22
Lose 2 points for every existing PC within a 1/2 mile radius. None
Lose 1 point for every existing PC within a 1 mile radius. #5, #9, #10, #11, #13
Lose .5 point for every existing PC within a 1.5 mile radius.#2
Lose .25 point for every existing PC within a 2 mile radius. None
Lost 5.5 points. 8/12/19
29 Traffic & Parking 3 3 Public Service Review Tier 1 plan. Excellent parking/circulation. 8/30/19
30 Security Plan 3 3 LPD Review Tier I ‐ bank vault, on site guard, alarm system w/ color printer, panic button, off site video storage,
Man trap barrier, equipment specs 8/20/19
Total ‐ Land Use &
Resident Safety 20 12.50
31 Planned Outreach 1 1 Community Outreach, Outreach&Ed, 7 pgs. Has plan. 8/12/19
32 Improvements to Building 3 3 Building Improvements
Support Docs
SEV‐$280,600
Proposed Improvements $643,250.00 ‐ 229% of SEV
Has proposal from ZA Design Build which supports that amount. 8/26/19
33 Plan to Minimize Traffic 1 1 Traffic Study, Neighborhood Compatibility & Plans to minimize
traffic 10pgs total Has a plan. 9/12/19
34 Noise Plan 1 1 Noise & Odor
Noise Plan Has plan. 8/12/19
35 Odor Plan 4 3 Noise & Odor
Odor Plan, Odor Plan, 2 pages Has detailed plan, but no specs or budget. 8/12/19
Total Outreach 10 9
36 Stakeholder History
Proof of LARA Prequal 2 2 demo of reg prequalification Received prequalification letter dated 7/18/19 for Blackstone Harvest, LLC. 8/12/19
37 Demo of Regulatory
Compliance 5 5
https://bsaonline.com/SiteSearch/SiteSearchDetails?SearchFocus
=All+Records&SearchCategory=Address&SearchText=6450+s+ced
ar&uid=384&PageIndex=1&ReferenceKey=33‐01‐05‐10‐151‐
012&ReferenceType=0&SortBy=&SearchOrigin=0&RecordKeyDis
playString=33‐01‐05‐10‐151‐012&RecordKey=1%3d33‐01‐05‐10‐
151‐012%3a%3a4%3d33‐01‐05‐10‐151‐
012%3a%3a7%3d55b67cb1‐daee‐40e6‐9dae‐
9f2801426ce9%3a%3a13%3d4975&RecordKeyType=1%3d0%3a%
3a4%3d0%3a%3a7%3d2%3a%3a13%3d1
No code violations, no conditional denial letters. 9/12/19
38 Morals, Good Order & General
Welfare Litigation History 3 3 Morals Lit Hist Demo of Reg Has completed form(s) for all stakeholder(s). 9/12/19
Total Applicant
Stakeholder History 10 10
Total Score 100 73.50
2151
EXHIBIT
2
Pro Forma/Budget
152
BLACKSTONE HARVEST, LLC - PRO FORMA YEAR 1 YEAR 2 YEAR 3
Sales $9,000,000 $10,500,000 12,000,000
Costs of Goods Sold/Inventory $2,640,000 $2,900,000 $3,215,000
GROSS PROFIT $6,360,000 $7,600,000 $8,785,000
OPERATING EXPENSES
Salary and Wages $1,490,000 $1,550,000 $1,575,000
Employee Benefits and Bonuses $150,000 $160,000 $170,000
Capital Investments $1,843,250 $300,000 0
Outside Services $35,000 $35,000 $35,000
Supplies/Furniture/Equipment (Office & Operation) $160,000 $50,000 $70,000
Repairs & Maintenance $23,000 $38,000 $41,000
Noise Elimination Equipment $25,000 $0 $0
Odor Elimination Equipment $104,000 $0 $0
Marketing & Advertising $58,000 $36,000 $42,000
Car & Travel & Vehicle Misc. $50,000 $55,000 $57,000
Accounting $24,000 $25,000 $26,000
Legal $36,000 $36,000 $36,000
Telephone $10,000 $10,000 $10,000
Utilities $19,000 $19,000 $20,000
Insurance & Workers Comp $10,000 $10,000 $10,000
Security Monitoring $16,000 $16,000 $16,000
General Admin $3,000 $3,000 $3,000
Patient Education $20,000 $20,000 $20,000
Community Spending and Charity $130,000 $145,000 $170,000
TOTAL EXPENSES $4,206,250 $2,508,000 $2,301,000
NET INCOME BEFORE INTEREST TAX DEPRECIATION AND AMORTIZATION $2,153,750 $5,092,000 $6,484,000
153
EXHIBIT
7
Plan to Integrate
154
Blackstone Harvest, LLC – Plan to Integrate with a Grower Facility
Blackstone Harvest, LLC (“Blackstone Harvest”) will integrate the provisioning center with a medical marijuana grower facility in the City of Lansing. Blackstone Harvest has a signed purchase agreement for the property commonly known as 209 Baker Street, Lansing, Michigan 48910. Blackstone Harvest will be purchasing the property for $1,000,000.00. The property is
approximately 13,600 square feet and is situated on approximately 2.47 acres of land. Blackstone
Harvest will file an application to operate a licensed medical marijuana grower facility at the property. Blackstone Harvest will grow 1,000 plants or more at the proposed facility. Blackstone Harvest’s application for the proposed grower facility will include separate business and operational plans, as well as other relevant information, in accordance with the City of Lansing’s Code of Ordinances.
155
156
157
EXHIBIT
8
209 Baker - Purchase Agreement
158
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EXHIBIT
9
209 Baker - Construction Quote
166
Interior & Exterior
Commercial & Residential Properties
______________________________
2011 Orchard Lake Road
Sylvan Lake, Michigan 48320
(248) 791-2222 Office
Date: 06/26/2019
Customer: Blackstone Harvest LLC
Address: 209 Baker St
Lansing, MI 48910
JOB: Baker St Lansing
It is agreed between contractor and the undersigned customer as follows:
Demolition
Remove all debris from site
Site Work
Underground utilities
Grade Site
New asphalt and striping per plan
New concrete curbing per plan
New handi-cap sign
New dumpster enclosure with foundation, block work and fence per plan
New landscaping per plan
Concrete
Trench footing
4” concrete floor
Masonry
Masonry block framing 4” burnished block per plan
167
4” brick veneer per plan
Metals
Exterior corrugated metal framing
Steel awnings per plan 3 5/8” 20 GA. Interior metal framing Roof steel framing and steel beams Parapet metal coping
Carpentry 1/2” sheathing over parapet walls
Rough framing
Laminate counters per plan
Thermal and Moisture Protection
Batt insulation per energy calculation
Sound insulation R11
Doors
(10) 3'-0"x6'-8" solid doors per plan 3'-0"x6'-8" hollow metal security door (4) New entry door per plan
Finishes
4” rubber base 5/8” drywall per plan. Sherwin Williams paint.
Buff all concrete floors.
New glass system per plan.
Purchaser agrees to pay the contractor the sum of ($2,040,000.00) on the following terms:
Deposit with Contract ($40,000.00), Balance ($2,000,000.00). BALANCE TO BE PAID MONTHLY AS
WORK IS IN PROGRESS, WITH BALANCE DUE WITHIN SIX (6) MONTHS AFTER PROJECT
COMPLETION.
Upon the failure of the Purchaser to comply with any payment term, other than the deposit term of the contract,
the entire contract price or so much as then remains unpaid shall be deemed immediately due and payable.
“IN THE EVENT PAYMENTS ARE NOT MADE WHEN DUE, THE CUSTOMER SHALL BE LIABLE FOR
PAYMENT OF A REASONABLE ATTORNEY FEE AND
TO ENFORCE COURT COST TO ENFORCE COLLECTION THEREOF.”
Contractor: X____________________________
Four Seasons Contracting, Inc.
Customer: X_____________________________
Blackstone Harvest, LLC
168
EXHIBIT
10
Receipt for Grow Application
169
10/2/2019 City of Lansing Clerk,MI-Online Payments
https://client.pointandpay.net/web/cityoflansingclerkmi 1/1
Step 1: Select Payments Step 2: Review and Submit Step 3: Confirmation and Receipt
Step 3: Confirmation and Receipt
Result: Payment Authorized
Confirmation Number: 64893086
Your payment has been authorized successfully and payment will be processed.
The City of Lansing Clerk thanks you for your payment. For questions about your account, please call 517-483-4131. Credit card payments will show up as City of Lansing Clerk. E-check
payments will show up as PNP BILLPAYMENT 8888916064 Thank you for using our bill payment services.
Please save or print a copy of this receipt for record keeping purposes.
My Bills
Description Amount
MJ Facilities License payment of $5,000.00 on Submission Number 10787 $5,000.00
Customer Information
First Name: Joann
Last Name: Steil
Address Line 1: 22618 Shorewood Dr
Address Line 2:
City:St Clair Shores
State: Michigan
Zip Code: 48081
Phone Number: 5867031702
Email Address: jsteil902@gmail.com
Subtotal:$5,000.00
Convenience Fee: $150.00
Total Payment:$5,150.00
Payment Information
Payment Date: 10/02/2019
Card Type: Visa
Card Number: ************5774
Print
170
EXHIBIT
11
Job Creation Plan
171
Blackstone Harvest, LLC – Job Creation – Additional Lansing Jobs
Investment in 209 Baker Street, Lansing, MI 48910:
The Company is also purchasing a 13,600 sq. ft. property to integrate a grower facility with the
proposed provisioning center. This grower facility will have a Class C grow license that will
allow a 1,500-plant grow operation. The property we are purchasing is commonly known as 209 Baker Street, Lansing, MI 48910. The total capital investment to purchase the property will be $1,000,000.00. We project that this building will require an additional investment of $2,040,000.00 to renovate the interior and exterior of the building for purposes of a medical marijuana grower facility.
Job Creation at 209 Baker Street, Lansing, MI 48910:
We will employ approximately 50 to 60 employees to work at the grower facility.
Job Creation Effects on Economy of Lansing:
The total jobs added in Lansing will be between 50 to 60 new jobs. This will have a profound effect on the local economy, especially since our Company will seek to hire locally.
Our Company will provide a living wage that is at least 200% above the Federal Poverty Level for a family of two (2). All of our employees will be paid more than $15.00/hr. in wages and will be eligible for Company paid health insurance, as well as benefits. Our benefits will include, but are not limited to, paid vacation time off, paid personal time off, employee retirement savings
plans, which will include employer contributions, and an employer paid health insurance
package, among other things. Our Company also seeks to increase the number and diversity of job opportunities for residents in the City of Lansing and its surrounding community. We’re confident that our presence in the City will improve the standard of living and quality of life for many individuals by increasing
and improving the job opportunities available. We will build resources that support environmental protection, education, and cultural and social growth. Our educational programs and training will lead to a knowledgeable staff who will possess skillsets that will translate to opportunities for career growth and development.
Employer Covered Group Health Insurance Plan:
Our employees will receive health benefits. We will find a plan that best meets our needs and give employees the option to enroll in our group health insurance plan. Health insurance will be fully covered by our Company.
172
Employee Benefits:
Our Company will provide employees with a variety of benefits for working with us. We want the best candidates and we will incentivize employees for staying with us by offering long-term benefits. After the first six months of employment, employees will be eligible for a week of paid vacation time off and three (3) days of personal time off. After
the first three (3) years of employment with our Company, employees will have two
weeks of paid vacation time off, and four (4) days of personal time off. Additionally, we will work with a nationally recognized service provider, such as Merrill Lynch, to adopt a retirement and benefits package for our employees to enroll in. Any employee that puts money towards their employee retirement account will receive a
Company match of up to 3% of the employee’s yearly income.
Employee Bonuses:
Our Company will offer bonuses to employees based on their performance and continued training. Bonuses will be discretionary and will be paid on a yearly basis after Q4.
Hiring Local:
Our Company will use its best efforts to employ City of Lansing residents. We will use existing City resources, and/or online recruitment services, to help us in the endeavor of receiving an abundance of employment applications from City residents. Our goal is to develop and maintain a dynamic partnership with City residents so that our Registered
Patients can see familiar faces at our facility.
Employing the Chronically Underemployed: We want to give the chronically underemployed new opportunities in this new and
fascinating industry. Our commitment to hire locally will also be matched with our commitment to hire the chronically underemployed. We will work to find individuals who have unexpectedly lost their jobs or are experiencing a significant drop in work hours. We will connect with the Michigan Unemployment Insurance Agency and use the
Pure Michigan Talent Connect database to hire underemployed Michigan citizens.
Job Creation – Jobs and Compensation at Grower Facility:
Position Number of
Employees
Designation Compensation
Horticulturists 22 8 Full-Time - Hourly 14 Part-Time – Hourly
$17.00/hr.
173
Packaging Team Member 4 1 Full-Time - Hourly 3 Part-Time – Hourly
$17.00/hr.
Tissue Culture Technician 1 Full-Time – Salary $60,000.00/year
Director of Quality Assurance 1 Full-Time – Salary $60,000.00/year
Director of Cultivation 1 Full-Time – Salary $150,000.00/year
Inventory Manager 1 Full-Time – Salary $55,000.00/year
Cultivation and Quality Assurance Techs 8 2 Full-Time – Hourly 6 Part-Time - Hourly
$16.00/hr.
Packaging Manager 1 Full-Time – Salary $60,000.00/year
General Manager 1 Full-Time – Salary $75,000.00/year
Assistant Manager(s) 2 Full-Time – Salary $50,000.00/year
Account Manager 1 Full-Time – Salary $55,000.00/year
Master Grower(s) 2 Full-Time – Salary $150,000.00/year
Compliance Director 1 Full-Time –
Salary
$55,000.00/year
Maintenance Manager 1 Full-Time -
Hourly
$16.00/hr.
Security Manager 1 Full-Time – Salary $55,000.00/year
Receptionist/Admin 1 1 Full-Time Hourly $18.00/hr.
Security Officer(s) 3 1 Full-Time Hourly 2 Part-Time
Hourly
$16.00/hr.
Community Outreach
Manager
1 Full-Time
Hourly
$18.00/hr.
Information Technology
Specialist(s)
1 Full-Time
Hourly
$18.00/hr.
174
Blackstone Harvest, LLC – Employee Compensation and Jobs Available
Our Company will provide a living wage that is at least 200% above the Federal Poverty Level for a family of two (2). All of our employees will receive above $15.00/hr. in wages and will be eligible for Company paid health insurance, as well as benefits. Our benefits will include, but are not limited to, paid vacation time off, paid personal time off, employee retirement savings plans,
which will include employer contributions, and an employer paid health insurance package,
among other things.
Investment in 6450 S. Cedar St., Lansing, MI 48911:
Blackstone Harvest, LLC (the “Company”) is purchasing the property commonly known as 6450
S. Cedar St., Lansing, Michigan 48911 for the purpose of developing and operating a licensed medical marijuana provisioning center. The total capital investment to purchase the property will be $1,200,000.00. Per our building development plan and construction plans, the renovation needed for the building will cost an additional $643,250.00.
Job Creation at 6450 S. Cedar St., Lansing, MI 48911: We will employ between 34 to 40 employees to work at the provisioning center. Of those employees, approximately ten (10) employees will be in a management or leadership position.
Job Creation Effects on Economy of Lansing:
The total jobs added in Lansing exclusively from our provisioning center will be between 34 and 40 new jobs. This will have a profound effect on the local economy, especially since our
Company will seek to hire locally.
Our Company also seeks to increase the number and diversity of job opportunities for residents in the City of Lansing and its surrounding community. We’re confident that our presence in the City will improve the standard of living and quality of life for many individuals by increasing and improving the job opportunities available. We will build resources that support
environmental protection, education, and cultural and social growth. Our educational programs and training will lead to a knowledgeable staff who will possess skillsets that will translate to opportunities for career growth and development.
Hiring Local:
Our Company will use its best efforts to employ City of Lansing residents. We will use existing City resources, and/or online recruitment services, to help us in the endeavor of receiving an abundance of employment applications from City residents. Our goal is to develop and maintain a dynamic partnership with City residents so that our Registered
Patients can see familiar faces at our facility.
175
Employing the Chronically Underemployed:
We want to give the chronically underemployed new opportunities in this new and fascinating industry. Our commitment to hire locally will also be matched with our commitment to hire the chronically underemployed. We will work to find individuals who have unexpectedly lost their jobs or are experiencing a significant drop in work
hours. We will connect with the Michigan Unemployment Insurance Agency and use the
Pure Michigan Talent Connect database to hire underemployed Michigan citizens.
Executive Salary Compensation:
Position Number of
Employees
Designation Compensation
CEO 1 Full-Time – Salary $130,000.00/year
CFO 1 Full-Time – Salary $90,000.00/year
COO 1 Full-Time – Salary $90,000.00/year General Counsel 1 Full-Time - Salary $90,000.00/year
Full-Time/Part-Time Staff Compensation:
Position Number of
Employees
Designation Compensation
Compliance Manager 1 Full-Time – Salary $45,000.00/year
Human Resources Manager 1 Full-Time –
Salary
$45,000.00/year
Accountant/Bookkeeper 1 Full-Time –
Salary
$50,000.00/year
Product Pricing Specialist 1 Full-Time –
Salary
$40,000.00/year
Financial Analyst 1 Full-Time – Salary $45,000.00/year
Security Manager 1 Full-Time – Salary $45,000.00/year
General Manager 1 Full-Time – Salary $65,000.00/year
Assistant Manager(s) 1 Full-Time – Salary $45,000.00/year
Account Manager 1 Full-Time – Salary $40,000.00/year
Patient Care Specialist(s) 8 4 Full-Time Hourly 4 Part-Time Hourly
$16.00/hr.
Provisioning Center Technician(s) 8 4 Full-Time Hourly $16.00/hr.
176
4 Part-Time Hourly
Maintenance Manager 1 Part-Time
Hourly
$16.00/hr.
Inventory Coordinator(s) 1 Full-Time
Hourly
$18.00/hr.
Receptionist(s) 3 1 Full-Time
Hourly 2 Part-Time Hourly
$16.00/hr.
Security Officer(s) 4 1 Full-Time Hourly 3 Part-Time Hourly
$16.00/hr.
Community Outreach Manager 1 Full-Time Hourly $18.00/hr.
Information Technology Specialist(s) 1 Full-Time Hourly $18.00/hr.
Organizational Job Descriptions
Chief Executive Officer/President (CEO)
The CEO is responsible for all facets of the operation, including financial oversight. The CEO is the leader of the
management team with responsibility for managing all senior managers. The CEO will have significant interaction
with the principals/owners of the Company and all outside groups including state regulators, local government
officials, and community groups. The CEO develops policy and communicates expectations and the Company’s
mission.
Chief Financial Officer (CFO)
The CFO is responsible for direction and oversight of the financial functions of the Company, in accordance with
U.S. generally accepted accounting principles and in accordance with MMFLA rules and regulations. The CFO
oversees accounting controls and procedures concerning the collection, verification, and analysis of financial
information.
177
Chief Operations Officer (COO)
The COO is responsible for carrying out our Company’s strategic plan through overseeing operations, developing
functional roles and assigning responsibilities to employees. The COO is responsible for overseeing the inventory
control system which includes day-to-day operations of dispensing, packaging, administrative offices and inventory
control.
General Counsel
The General Counsel is responsible for offering counsel on a variety of legal issues, advising Company executives,
and ensuring compliance with legal requirements.
Financial Analyst
The Financial Analyst is responsible for financial planning, analysis, and projection for the Company. The Financial
Analyst identifies trends and makes recommendations concerning system improvements.
Product Pricing Specialist
The Product Pricing Specialist implements pricing strategies that meet the Company’s standards, policies and
procedures.
Accountant/Bookkeeper
The Bookkeeper is responsibility for daily accounting duties. The Bookkeeper will cooperate with the Company’s
outside accounting firm and Inventory Coordinator to complete regular audits of the system.
Human Resource Manager
The HRM oversees policies, procedures and compliance relating to Company employees. Further, HRM ensures all
human resources activities are in compliance with local, state and federal laws; and implements and oversees
programs related to employee benefits and initiatives. Employee benefits are overseen by the HRM as well. The
HRM makes recommendations on potential policy changes to ensure the Company offers a healthy package of
178
salary and benefits to employees. The HRM ensures the workplace is accommodating and free of harassment,
handling complaints in accordance with policy and any relevant laws.
Compliance Manager
The Compliance Manager is responsible for upholding the Michigan Medical Marihuana Program guiding principles
as well as overall Company compliance. The Compliance Manager will be responsible for communicating with the
Department to schedule inspections, reviewing policies and procedures and updating on a quarterly basis as well
as educating the Company’s employees on compliance and regulations. The Compliance Manager will also assist
the inventory coordinator with quality control and ensure all products are tested, labeled, and packaged properly.
Security Manager/Officers
The dispensary will employ a Security Manager and Security Officers to oversee the safety of staff and the security
of the facility. The Security Manager is responsible for all security of the facility and its perimeter, and will train all
staff as to basic security protocols. The Security Manager is also responsible for the security and safety of the
immediate environment outside of the facility perimeter to the extent that the provisioning center’s operations
relate to the welfare of the neighbors, arising from the facility’s presence in the neighborhood. The Security
Manager will maintain strict vigilance for diversion and deviation of medicine.
Information Technology Specialist
The IT Specialist is responsible for the implementation of the Company’s computer systems. The IT Specialist will
also be responsible for systems-related staff training, as well as integrity of the information and security of the
systems including physical and as electronic security.
Community Outreach Manager
The Community Outreach Manager will oversee the planning and implementation of outreach strategies. The
Community Outreach Manager is primarily responsible for connecting people in the broader community and
cultivating relationships with businesses, individuals, and other relevant organizations.
179
Maintenance Manager
The Maintenance Manager is responsible for planning, organizing and managing preventive maintenance, cleaning,
and repairs to equipment, fixtures, furnishings and the structure.
General Manager
The General Manager’s responsibility is to oversee all day-to-day operations of the Company including sales,
money inventory, storage of medical marihuana Products, cleanliness and organization, and signage. The General
Manager will also be responsible for ensuring that all operations are compliant with state and local law, and that
all appropriate steps are being taken to mitigate exposure under Federal law.
Account Manager
The Account Manager serves as lead point of contact for all account management matters, and completes
administrative work as required.
Inventory Coordinator
The Inventory Coordinator will be responsible for taking inventory of any usable or unusable medical marihuana
during all processes from seed to sale. The Inventory Coordinator will also be responsible for reporting any
inventory discrepancies to the appropriate supervisor.
Receptionist
The Receptionist is responsible for checking in a patient and ensuring the patient is an active card holder. Since the
Receptionist is the front lines of operations, it is imperative that this individual is professional, knowledgeable, and
trustworthy.
Provisioning Center Tech
The Provisioning Center Techs are responsible for verifying the status registered qualified patients and maintains
accurate records of transactions, patient data, and identification documents. They respond to inquiries and walk
guests through the facility.
180
Patient Care Specialist
The Patient Care Specialists will be stationed in the Provisioning Center and will dispense Medical Marihuana
Products to Patients. Other responsibilities will include providing each Patient/Designated Caregiver with
knowledgeable and welcoming service, entering each sale into the POS system, and working closely with the
General Manager to ensure the Provisioning Center area is clean and organized.
181
Blackstone Harvest, LLC – Other Compensation and Information
Our Company will provide a living wage that is at least 200% above the Federal Poverty Level for a family of two (2). All our employees will receive at least $15.00/hr. in wages and will be eligible for Company paid health insurance, as well as benefits. Our benefits will include, but are not limited to, paid vacation time off, paid personal time off, employee retirement savings plans,
which will include employer contributions, and an employer paid health insurance package,
among other things. Our Company also seeks to increase the number and diversity of job opportunities for residents in the City of Lansing (the “City”) and its surrounding community. We’re confident that our presence in the City will improve the standard of living and quality of life for many individuals
by increasing and improving the job opportunities available. We will build resources that support environmental protection, education, and cultural and social growth. Our educational programs and training will lead to a knowledgeable staff who will possess skillsets that will translate to opportunities for career growth and development.
Employer Covered Group Health Insurance Plan:
We will offer our employees health benefits. We will find a plan that best meets our needs and give employees the option to enroll in our group health insurance plan. Health insurance will be fully covered by our Company.
Employee Benefits:
Our Company will provide employees with a variety of benefits for working with us. We want
the best candidates and we will incentivize employees for staying with us by offering long-term
benefits. After the first six months of employment, employees will be eligible for a week of paid vacation time off and three (3) days of personal time off. After the first three (3) years of employment with our Company, employees will have two weeks of paid vacation time off, and four (4) days of personal time off.
Additionally, we will work with a nationally recognized service provider, such as Merrill Lynch, to adopt a retirement and benefits package for our employees to enroll in. Any employee that puts money towards their employee retirement account will receive a Company match of up to 3% of the employee’s yearly income.
Employee Bonuses: Our Company will offer bonuses to employees based on their performance and continued training. Bonuses will be discretionary and will be paid on a yearly basis after Q4.
182
Hiring Local:
Our Company will use its best efforts to employ City of Lansing residents. We will use existing City resources, and/or online recruitment services, to help us in the endeavor of receiving an abundance of employment applications from City residents. Our goal is to develop and maintain a dynamic partnership with City residents so that our Registered Patients can see familiar faces at
our facility.
Employing the Chronically Underemployed: We want to give the chronically underemployed new opportunities in this new and fascinating industry. Our commitment to hire locally will also be matched with our commitment to hire the
chronically underemployed. We will work to find individuals who have unexpectedly lost their jobs or are experiencing a significant drop in work hours. We will connect with the Michigan Unemployment Insurance Agency and use the Pure Michigan Talent Connect database to hire underemployed Michigan citizens.
183
Blackstone Harvest, LLC – Commitment to Pay Over $15.00/hr.
Our Company will provide a living wage that is at least 200% above the Federal Poverty Level for a family of two (2). All our employees will receive above $15.00/hr. in wages and will be eligible for Company paid health insurance, as well as benefits. Our benefits will include, but are not limited to, paid vacation time off, paid personal time off, employee retirement savings plans,
which will include employer contributions, and an employer paid health insurance package,
among other things.
184
Blackstone Harvest, LLC
Blackstone Harvest, LLC – Employee Staffing & Training Plan
CEO/President
185
EXHIBIT
12
CPA Attested Financial Statement
186
As of December 31, 2018
Statement of Financial Condition
Joann Steil
187
Accountants' Agreed Upon Procedures Report
Financial Statements:
Statement of Assets and Liabilities
Notes to Financial Statements
Table of Contents
As of December 31, 2018
Statement of Financial Condition
Joann Steil
188
Joann Steil
22618 Shorewood Dr
St. Clair Shores, MI 48081
We have performed and applied agreed-upon procedures enumerated below on behalf of Joann Steil.
These agreed-upon procedures were conducted in accordance with Statement on Standards for
Attestation Engagements (SSAE) established by the American Institute of Certified Public Accountants
(AICPA). The sufficiency of these procedures is solely the responsibility of those parties specified in
this report. Consequently, we make no representation regarding the sufficiency of the procedures
described below either for the purpose for which this report has been requested or for any other purpose.
These agreed upon procedures have been applied to determine the statement of financial condition of
Joann Steil as of December 31, 2018, and the related notes to the financial statement.
However, we do not express an opinion on these financial statements.
Joann Steil's Responsibility for the Financial Statement
Joann Steil is responsible for the preparation and fair presentation of this financial statement
in accordance with accounting principles generally accepted in the United States. This includes
the design, implementation, and maintenance of internal control relevant to the preparation and fair
presentation of a financial statement that is free from material misstatement whether due to fraud or error.
Accountant's Responsibility
Our responsibility is to conduct this engagement in accordance with Statements on Standards
for Attestation Engagements (SSAE) promulgated by the American Institute of Certified Public
Accountants (AICPA). We believe that the results of these procedures provide a reasonable basis
of our conclusion.
Accountant's Conclusion
Based on the agreed upon procedures performed, we declare to the best of our knowledge, the
statement of financial condition of Joann Steil is complete and accurate.
Best Regards,
Simon H. Gumma, CPA, CGMA
President
February 14, 2019
P: (248) 729-7171 / F: (248) 729-7373
Troy, MI 48084
888 W Big Beaver Rd, Ste 300
Certified Public Accounting
Gummaco, P.C.
189
Cash on Hand 1,000$
Cash in Banks
PNC Bank - Adv Plc Serv Inc Checking #...1339 24,748$
Extra Credit Union Checking #...0040 36,261
Extra Credit Union Savings #...0001 367,688
Extra Credit Union Savings #...8036 31,107
Chemical Bank Savings #...1238 87,577
Total 547,382
AXA Advisors Annuity 201,512
Furniture & Personal Effects 27,500
Jewelry 30,000
Automobiles / Boats / Motorcycles
2010 Jeep Wrangler Islander 20,000
2007 GMC Savana Conversion Van 9,500
2010 Rinker Boat 15,000
2002 Harley Davidson Road King Classic 20,000
2014 Harley Davidson Sportster 883 4,000
Total 68,500
Principal Residence - 22618 Shorewood Dr 450,000
Investments in Business Ventures 35,000
Investments in Real Estate 250,000
Total Assets 1,610,894$
Mortgage - Wells Fargo Bank 172,943$
Estimated income taxes on the difference
between the estimated current value of assets
and their tax basis (See Note 4)40,000
Total Liabilities 212,943$
Net Worth 1,397,951$
Total Liabilities and Net Worth 1,610,894$
Joann Steil
Statement of Financial Condition
As of December 31, 2018
Assets
Liabilities & Net Worth
190
Ownership Fair Market Net Share of
Business Description %Value (FMV)Liabilities Equity Equity
Advanced Placement Services Inc 100.000%35,000 - 35,000 35,000
Elder Care Placement Services
22618 Shorewood Dr
St. Clair Shores, MI 48081
Totals 35,000$ -$ 35,000$ 35,000$
Ownership Fair Market Total Share of
Real Estate Description %Value (FMV)Liabilities Equity Equity
10410 E Jefferson LLC 50.000%500,000 - 500,000 250,000
Future Development
10410 - 10440 E Jefferson Ave
Detroit, MI 48214
Totals
500,000$ -$ 500,000$ 250,000$
Schedule of Real Estate Investments
Joann Steil
Statement of Financial Condition
As of December 31, 2018
Schedule of Business Ventures
191
Note 1:
Estimated current values were based at either (1) fair market values,
(2) appraised values or (3) broker purchase opinion (BPO).
Note 2:
Amounts for Investments in Business Ventures were based on
compiled financial statements as of December 31, 2018.
Note 3:
Amounts for Investments in Commercial Real Estate were based at either
(1) fair market values, (2) appraised values or (3) broker purchase opinion (BPO).
Note 4:
Estimated income taxes have been provided on the excess of the
estimated current values of assets over their tax basis as if the
estimated current values of the assets, had been realized on the
statement date, using applicable tax and regulations.
The provision will probably differ from the amount of income taxes
that eventually might be paid because those amounts are determined
by the timing and the method of disposal or realization.
Joann Steil
Statement of Financial Condition
As of December 31, 2018
Notes to Financial Statements
192
EXHIBIT
13
Organizational Structure
193
Blackstone Harvest, LLC – Ownership Structure
Blackstone Harvest, LLC (“Blackstone Harvest”) is a Michigan limited liability company. Blackstone Harvest was established in January 2019. It has a registered office located at 2222 W. Grand River, Ste A, Okemos MI 48864. Blackstone Harvest is owned by a single member – Joann Steil.
NAME OWNERSHIPT INTEREST
Joann Steil 100%
194
EXHIBIT
14
Operating Agreement
195
196
197
198
199
EXHIBIT
15
Bank Statements, Annuity, Deed
200
201
202
203
204
205
206
207
EXHIBIT
16
Financial Structure Cover Page
208
Blackstone Harvest, LLC – Financial Structure and Financing
Blackstone Harvest, LLC is owned solely by its managing member, Joann Steil. Ms. Steil has provided CPA attested financials that demonstrate she has a net worth of almost $1.4 million, of which $500,000 is available in cash in her bank accounts. Additionally, Ms.
Steil has access to cash from an annuity valued at $201,512. These financials are supported by
bank/account statements included with this application. Ms. Steil acquired the property located at 6450 S. Cedar by land contract, which has limited her initial out-of-pocket costs significantly (although Ms. Steil is responsible for paying the remaining balance of the property over time).
Ms. Steil will acquire the property at 209 Baker by utilizing her cash and financing options. The interior and exterior renovations to the proposed provisioning center at 6450 S. Cedar and
the proposed grow facility at 209 Baker will be performed by 4 Seasons Contracting, which has
agreed to provide Ms. Steil with financing for the project. This type of arrangement is not uncommon for large projects like the proposed renovations to 6450 S. Cedar and 209 Baker.
209
EXHIBIT
17
Sworn Statement of Truthfulness
210
211
EXHIBIT
18
Odor Plan
212
Blackstone Harvest, LLC – Odor Plan
Our desire to be a good neighbor includes avoiding nuisances of odor that may be
generated by our operations. It’s not a secret – medical marijuana has a distinct odor. However, our company has designed the following odor control plan with our HVAC vendor to mitigate against such a nuisance: 1. The space will be conditioned using multiple split heat pump systems of various capacities and a ductless mini-split system. Each of the
split-systems, excluding the ductless mini-split system, are equipped
with unit-level pleated filters. Fresh air is brought to each of the
ducted systems via a fresh air duct that is run to the exterior of the
structure. This fresh air will tend to pressurize the space.
2. The space is designed for a negative pressure to contain internal odors. To accomplish this, an in-line, belt driven exhaust fan is provided to remove the amount of fresh air provided for the occupants and an additional amount that will ensure a negative pressure within the space.
3. To prevent odors from escaping the structure, the in-line exhaust fan
is equipped with a filter section loaded with approximately thirty
pounds of activated carbon, in a rack-mounted configuration.
Activated carbon is an extremely effective absorptive odor control
substance. An ozone generator will be placed upstream of the carbon
filters, in the housing assembly. Ozone (O3) is an effective odor
control mechanism. In this case, it is used to help control out-going airstream odors and recharge the activated carbon filter media, extending the life of the media.
4. Once systems are running, systems shall be air balanced to ensure
design air flows for supply, fresh air, and exhaust air base values have
been met. Once completed, a differential pressure gauge will be used
to ensure a negative building static of no less than .05” of negative
building static has been achieved. A maximum negative building
static shall not exceed .15”. An initial test with a trade-specific calibrated sensor establishes the base-line of operation for odors in the out-going air stream.
213
5. Once odor control has been established, periodic testing will be
conducted to ensure that the odor control systems are operating to maintain the baseline. As the filters age, replacement will be required and will be conducted, as determined by the calibrated sensor on the test equipment. 6. Testing will be done, in the absence of other standards in accordance
with Standardized Odor Measurement Practices for Air Quality
Testing. Testing shall be done using a field Olfactometer, calibrated in
accordance with odor control standards using the scheduled
monitoring protocol.
7. We will have planned and scheduled monitoring in which we will conduct a daily walk-about visit around the exterior of the site, near the exhaust system. We will compile and compare the data we record to establish norms using a 5-point Odor Intensity Reference Scale to
compare daily readings. If values equal 3 on the 5-point scale, then we
will evaluate and repair the carbon-filtration exhaust system, as
required. Evaluation will include, but is not limited to, fan operation,
distribution system integrity, and filter media effectiveness.
214
EXHIBIT
19
Sample Scoring Rubric
Provided by City
215
FINAL June 14, 2019
#Criteria Maximum
Points Ordinance Source
1 Ownership Structure Including percent ownership for each stakeholder 1 1300.05(b)(12)(i)
2 Organizational Chart Please include name, position and job description 1 1300.05(b)(12)(ii)
3 Worker Training Program 1 1300.05(b)(12)(vi)
4 Short and Long Term Goals and
Objectives 1 1300.05(b)(12)(viii)
5 Community Outreach & Education 1 1300.05(b)(12)(x)
6 Marketing, Advertising &
Promotion
Minimization of Exposure to Minors List methods/type, and how to
reduce chances of exposure to minors for each, including a budget and
examples.
3 1300.05(b)(12)(iii)
7 Tangible Capital Investment ‐
Dollar Amount
Total Capital Investment, stated in dollar amounts and supported by
factual data, which will directly benefit the City of Lansing, including all
types of medical marihuana facilities. Consideration of whether facility
is definite, feasible, or speculative.
Clarification 6/14/19: After reviewing the total TCI from the Top 20
Provisioning Centers in Phase 1, we determined the average TCI was
over $4 million. Scoring in this category will be distributed accordingly,
starting at ½ million of tangible capital investment.
5 1300.05(b)(12)(iv)
Medical Marijuana Provisioning Centers Scoring Criteria
Business Plan & Job Creation
6/14/19 ‐ City of Lansing Medical Marijuana Provisioning Center Scoring Criteria ‐ Phase 2 216
FINAL June 14, 2019
#Criteria Maximum
Points Ordinance Source
Medical Marijuana Provisioning Centers Scoring Criteria
8 Tangible Capital Investment ‐
Own/Lease
Documentation demonstrating ownership or exclusive lease of
provisioning center building by one or more stakeholders or applicant.
Preference given to ownership.
3 1300.05(b)(12)(iv)
9 Tangible Capital Investment ‐
Supporting Material
The completeness and quality of the documentation which
corroborates the financial figures provided for total capital investment 3 1300.05(b)(12)(iv)
10
Points awarded for evidence and explanation of the financial structure
and financing for the proposed medical marijuana establishment(s)
based upon (GAAP) general accepted accounting principles
2 1300.05(b)(12)(vii)
11 Proof of LARA Pre‐Qualification within 60 days of application filing 3
1300.08(e)
1300.04(b)
MCL 333.27402 (3)
(a), (b), (c )
12 Plans to Integrate Grower Facility
with other Establishments
Points awarded for evidence which documents ownership of licensed
(or pending application for) medical marijuana grow operations within
the City of Lansing.
4 1300.05(b)(12)(ix)
Financial Structure and Financing
6/14/19 ‐ City of Lansing Medical Marijuana Provisioning Center Scoring Criteria ‐ Phase 2 217
FINAL June 14, 2019
#Criteria Maximum
Points Ordinance Source
Medical Marijuana Provisioning Centers Scoring Criteria
13 Charitable Plans and Strategies Contributions, stated financial commitments, and/or volunteer work
supported by specific donation amount or value of volunteer work. 4 1300.05(b)(12)(xi)
14 Number of and job descriptions for FTE (Full‐time Equivalent) jobs at
this provisioning center ONLY.3 1300.05(b)(23)
14 Amount and type of other compensation ‐ Healthcare 2 1300.05(b)(23)
16 Amount and type of other compensation ‐ PTO
(Paid Time Off)1 1300.05(b)(23)
17 Amount and type of other compensation ‐ Retirement 1 1300.05(b)(23)
18 Percent of employees earning over $15 per hour.3 1300.05(b)(23)
19 Projected annual budget and revenue based upon (GAAP) generally
accepted accounting principles 2 1300.05(b)(23)
20
Number of additional jobs created by your stakeholders within the City
of Lansing at other medical marijuana facilities types.
(Grower/Processor)
6 1300.05(b)(12)(v)
Total ‐ Business Plan/Job
Creation Incomplete plan will get zero points 50 1300.06(b)(1)
Job Creation
6/14/19 ‐ City of Lansing Medical Marijuana Provisioning Center Scoring Criteria ‐ Phase 2 218
FINAL June 14, 2019
#Criteria Maximum
Points Ordinance Source
Medical Marijuana Provisioning Centers Scoring Criteria
21
Based on the completeness and amount of court‐ordered financial
liability reported on the Financial Resources Litigation history form. 1 1300.06(b)(5)
22 CPA Attestation of Net Worth or Bank Statements Supporting Initial
Start‐Up and Operating Costs 3
1300.05(b)(12)vii
1300.05(b)(22)
1300.06(b)(5)
MCL333.27402 (3)(a)
23 Proof LARA Pre‐Qualification submitted within 60 days of application
filing.3 1300.08(e)
MCL333.27402 (3)(a)
24 Combined stakeholder history of success in owning/operating a
relevant business or businesses in the City of Lansing. 1 1300.05(b)(8)
1300.06(b)(5)
25 Combined stakeholder history of success in owning/operating a
relevant business or businesses 1 1300.05(b)(8)
1300.06(b)(5)
26 Combined stakeholder history of success in owning/operating a
medical marihuana business or businesses.1 1300.05(b)(8)
1300.06(b)(5)
Total ‐ Financial Stability &
Experience 10 1300.06(b)(5)
Financial Stability & Experience
Sufficient Financial Resources
Business Experience
6/14/19 ‐ City of Lansing Medical Marijuana Provisioning Center Scoring Criteria ‐ Phase 2 219
FINAL June 14, 2019
#Criteria Maximum
Points Ordinance Source
Medical Marijuana Provisioning Centers Scoring Criteria
27
Surrounding Neighborhoods: Distance between residential zoned
areas and applicant's provisioning center. Evaluation is based on
whether any residential property abuts the proposed location, and if
not, whether there is residential zoning within 1/4 mile of the
proposed location.
7 1300.06(b)(2)
28
Surrounding Neighborhoods: Density of Provisioning Centers
surrounding the applicant's proposed location. Evaluation is based on
how many of the first round 20 PCs are within 1‐2 mile radius of
proposed provisioning center.
7 1300.06(b)(2)
29 Plan to Keep Traffic out of
Neighborhoods
Review of location site and any plan(s) the applicant has provided
which would minimize the traffic and parking impact on nearby
neighborhoods.
3 1300.06(b)(2)
30 Resident Safety Security Plan Review to ensure compliance with the Ordinance 3 1300.06(b)(2)
1300.05(b)(14)
Total ‐ Land Use 20 1300.06(b)(2)
Land Use
Impact on Neighborhood
6/14/19 ‐ City of Lansing Medical Marijuana Provisioning Center Scoring Criteria ‐ Phase 2 220
FINAL June 14, 2019
#Criteria Maximum
Points Ordinance Source
Medical Marijuana Provisioning Centers Scoring Criteria
31 Planned Outreach
Plan to meet with neighborhood organizations, business association,
crime watch, and other neighborhood organizations to provide contact
information for questions, concerns, etc.
1 1300.06(b)(3)
32 Improvements made or Proposed
to Building
Plan to make improvements to building and property. Applies to both
those that own and those that lease building. Please supply
documentation to support costs of improvements.
3 1300.06(b)(3)
33 Plan to Minimize/Eliminate Traffic Any plan(s) the applicant has provided which would minimize the
traffic and parking impact on nearby neighborhoods. 1 1300.06(b)(3)
1300.09(i)
34 Plan to minimize/eliminate noise
Any plan(s) the applicant has provided which would minimize or
eliminate the impact of increased noise on nearby neighborhoods.
Please document in budget of expenditures.
1 1300.06(b)(3)
1300.09(i)
35 Plan to Minimize/Eliminate Odor
Any plan(s) the applicant has provided which would minimize or
eliminate the impact of increased odor on nearby neighborhoods.
Please document in budget of expenditures.
4 1300.6B(3)
1300.09(i)
Total ‐ Outreach 10 1300.06(b)(3)
Outreach, Physical Improvements, Etc.
6/14/19 ‐ City of Lansing Medical Marijuana Provisioning Center Scoring Criteria ‐ Phase 2 221
FINAL June 14, 2019
#Criteria Maximum
Points Ordinance Source
Medical Marijuana Provisioning Centers Scoring Criteria
36 Applicant provides proof of LARA Pre‐Qualification within 60 days of
application filing. 2
1300.06(b)(4)
MCL 333.27401,
.27402 & .27405
37 Demonstration of regulatory compliance.5 1300.06(b)(4)
38
Based on the completeness and specific litigation reported on the
Morals, Good Order and General Welfare Litigation history form.3 1300.06(b)(4)
Total ‐ Applicant/Stakeholder
History
Will get zero points if found to have violated 2016 Ordinance #1202
Moratorium.10 1300.06(b)(4)
Total Points 100
Applicant/Stakeholders Record of
Acts Detrimental to Security,
Safety, Morals, Good Order,
General Welfare
Applicant/Stakeholder History
6/14/19 ‐ City of Lansing Medical Marijuana Provisioning Center Scoring Criteria ‐ Phase 2 222
Timeline
Weisberger Ventures
4213 S Cedar St.
Lansing, Michigan 48910
June 27, 2019 – Application submitted ................................................................... 2
July 1, 2019 – Department review of applications begins
July 25, 2019 – Distance Maps Created ................................................................. 11
September 19, 2019 – Score & Rank Denial Letter Sent ........................................ 12
October 3, 2019 – Hearing Officer Appeal submitted ........................................... 16
October 30, 2019 – Second Score & Rank Second Denial Letter Sent ................... 39
November 22, 2019 – Commission Appeal Submitted .......................................... 51
Pages containing information not included in the Tangible Capital Investment section
of the application were removed from both Exhibit Bs.
Pages containing information not included in the Business Experience section were
removed from both Exhibit Es.
1
2
3
4
5
6
7
8
9
10
11
12
September 20, 2019
Weisberger Ventures LLC
Paul Weisberger
211 E Nine Mile Road Unit 313
Ferndale, Michigan 48220
Dear Provisioning Center Applicant,
The Lansing City Ordinance section 1300.6 discusses Provisioning Center license application evaluation. Your score of 65.00 out of 100 eliminates the possibility of scoring in the top five. Therefore, your application for licensure is denied.
Attached are your sub-scores based on the criteria posted on https://lansingmi.gov/1637/Medical-Marijuana and a brief
summary of determining factors for each sub-score. You will not be selected to receive a Provisioning Center license in the City of Lansing for the proposed business at 4213 S Cedar St.
You have the right to appeal this denial of licensure within 14 days of the date of this letter by filing with the City Clerk’s
Office a written statement setting forth fully the grounds for the appeal pursuant to Chapter 1300.15(c). Please note that
initial appeals are referred to a hearing officer appointed by the City Clerk who will review the appeal and information
submitted. The hearing officer will consider the information and make a recommendation to the City Clerk, who will make
a decision on the appeal. To encourage efficiency, appeals will be conducted as a paper hearing without oral
presentation. Please ensure that you include all information in your written appeal that you would like the hearing officer
to consider. Appeals are limited to materials provided during the application process. No new application material will
be considered on appeal.
Chapter 1300 provides that should the applicant not receive a license, one-half the application fee shall be returned.
This refund will be processed after all appeals are exhausted.
Sincerely,
Chris Swope, CMMC/MMC
Lansing City Clerk
CC: City Attorney
Lansing Police Department
Chris Swope
Lansing City Clerk
13
City of Lansing Provisioning Center Ranking 9/20/2019 3:03 PM
Total
Possible
Points
Weisberger Ventures‐4213 S Cedar St
Applicant Address ‐‐‐
#Category ‐‐‐Score Location of material Scoring Insights
1 Ownership Structure 1 1 Org Docs, Ownership Struc., 1 pg.Has ownership structure. 8/23/19
2 Organizational Chart 1 1 Org Docs, Org Chart, 5 pgs.Has org chart. 8/23/19
3 Worker Training Program 1 1 OtherReqDocs Docs, Worker Training Plan, 11 pgs.Has plan. 8/23/19
4 Short and Long Term Goals and
Objectives 1 1 Org Docs, Goals, 1 pg.Has goals. 8/23/19
5 Community Outreach &
Education 1 1 Community Outreach, Outreach & Ed, 15 pgs.Has plan. 8/23/19
6 Marketing, Advertising &
Promotion 3 0 Marketing No examples of minor minimization. No budget. 7/8/19
7 Tangible Capital Investment
Dollar Amount 5 5 4 page Investment Plan Stated TCI is $5,200,000.00. 9/20/19
8 Tangible Capital Investment
Own/Lease 3 1 9 pages Lease with Permission Applicant has a lease for the building with owner permission to operate a MM facility, but does not
currently own building and did not provide a purchase agreement. 9/12/19
9 Tangible Capital Investment
Supporting Material 3 0 None attached Does not have supporting material to corroborate their TCI claim. 9/18/19
10 Financial Structure & Financing 2 0 Nothing submitted No GAAP operating budget or startup budget attached. 8/23/19
11 LARA Pre‐Qual 3 3 Demo of Reg Compliance Has prequalification letter dated 12/10/2018 for Weisberger Ventures II, LLC 8/23/19
12 Integration with Grows 4 0 Integrate
Has plans to open a grow and processor in Lansing. Applied for 3 Class C grow licenses, but has not
paid. Considered speculative until paid. Points awarded for feasible and definitive grows only.
8/23/19
13 Charitable Plans & Strategies 4 3 Charity $30K per year. No receipts or proof in form of signed agreement. 8/23/19
14 Number of and job
descriptions for PC ONLY 3 3 Job Creation More than six (6) jobs. Has detailed job descriptions. 8/23/19
15 Healthcare 2 2 Job Creation Employer will provide healthcare. 8/23/19
16 Paid Time Off 1 1 Job Creation Employer will offer paid time off. 8/23/19
17 Retirement 1 1 Job Creation Employer will offer 401K program. 8/23/19
18 % of employees at $15+/hr 3 3 Job Creation 100% of employees will make $15+/hr.
19 Projected Annual Budget 2 0 Nothing submitted No GAAP operating budget attached. 8/23/19
20 Total COL Jobs 6 5 Job Creation 170 jobs. Less than ideal number of jobs, which is 201+. 8/23/19
Total Business Plan &
Job Creation 50 32
21 Financial Litigation History 1 1 Financial Litigation Form Has completed form(s) for all stakeholders. 9/18/19
22 Net Worth 3 1 22 Unduplicated pages in Finance Section
Has $100K in applicant's (LLC) name.
No solid proof of net worth. CPA attestation is a compilation without exam or review.
Doesn't have full documentation of initial start‐up and operating costs. No budget submitted.
9/18/19
23 LARA Pre‐Qual 3 3 Demo of Reg Compliance Has prequalification letter dated 12/10/2018 for Weisberger Ventures II, LLC 8/23/19
24 Stakeholder Experience
City of Lansing Businesses 1 0 Experience Less than five (5) years combined Lansing business ownership. 9/18/19
25 Stakeholder Experience
Relevant Businesses 1 0 Experience Less than five (5) years combined relevant medical, agricultural or retail business experience. 9/18/19
26 Stakeholder Experience
Medical Marijuana Business 1 1 Experience More than five (5) years combined medical marijuana experience. 9/18/19
Total Financial Stability
&
Business Experience
10 6
27
Impact on Neighborhood
Distance Between PC &
Residential Zoning
7 3 https://lansing.maps.arcgis.com/apps/webappviewer/i
ndex.html?id=be0634345255438ba55b14c9b19e9f22
PC Property abuts Residential Zoning on 1 side (E,)
114
City of Lansing Provisioning Center Ranking 9/20/2019 3:03 PM
28 Impact on Neighborhood
Density of PCs 7 3
https://lansing.maps.arcgis.com/apps/webappviewer/i
ndex.html?id=be0634345255438ba55b14c9b19e9f22
Lose 2 points for every existing PC within a 1/2 mile radius. None
Lose 1 point for every existing PC within a 1 mile radius. #2
Lose .5 point for every existing PC within a 1.5 mile radius. #8, #16, #14, #11, #13, #9
Lose .25 point for every existing PC within a 2 mile radius. None
Lost 4 points. 8/23/19
29 Traffic & Parking 3 1 Public Service Review Tier 3 ‐ Poor traffic circulation & parking, and potential traffic into neighborhood streets. 9/20/19
30 Security Plan 3 3 LPD Review TIER 1 ‐ Well written plan. Video surveillance, alarms ‐ panic & silent, specified barriers, Vault,
security officers/guard, off site surv. storage, equip specs & signage for deterrence. 9/3/19
Total ‐ Land Use &
Resident Safety 20 10.00
31 Planned Outreach 1 1 Community Outreach, Outreach & Ed, 15 pgs.Has plan. 8/23/19
32 Improvements to Building 3 2 Building Improvements
Improvement Plan
SEV‐$153,400
Proposed Improvements $1,100,000 not substantiated by supporting documents.
717% of SEV
One point deduction for lack of support documents. 8/29/19
33 Plan to Minimize Traffic 1 1 Traffic Narrative plan submitted. 8/29/19
34 Noise Plan 1 1 Noise & Odor Has a plan. 8/23/19
35 Odor Plan 4 3 Noise & Odor Has a detailed plan, but no equipment specs or budget/quotes. 8/23/19
Total Outreach 10 8
36 Stakeholder History
Proof of LARA Prequal 2 2 Demo of Reg Compliance Has prequalification letter dated 12/10/2018 for Weisberger Ventures II, LLC 8/23/19
37 Demo of Regulatory
Compliance 5 5 https://bsaonline.com/SiteSearch/SiteSearchDetails?SeaNo code violations. No conditional denial letters. 9/18/19
38 Morals, Good Order & General
Welfare Litigation History 3 2 Demo of Reg Compliance Has completed form(s) for all stakeholders. 9/18/19
Total Applicant
Stakeholder History 10 9
Total Score 100 65.00
215
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
October 30, 2019
Weisberger Ventures, LLC
Paul Weisberger
211 E 9 Mile Rd, Unit 313
Ferndale, MI 48220-1968
Dear Provisioning Center Applicant,
I have reviewed the report and recommendation of the hearing officer on your appeal of the Scoring and
Ranking denial of your application to operate a Medical Marihuana Provisioning Center in the City of Lansing
at 4213 S Cedar St.
I have accepted the recommendation of the hearing officer to add one point to Category #22 – Net Worth.
Also, at my recommendation, three points were added to Category #12 – Integration and one point was
added to Category #38 – Morals, Good Order & General Welfare Litigation History.
For clarification: Category #9 – Tangible Capital Investment Supporting Materials does not measure how
much you are investing, but rather how much of your stated TCI is supported by corroborating material.
Based on these recommendations your score has been increased to 70 out of 100. However, this
eliminates the possibility of you scoring in the top five. Your application remains denied.
You have the right to appeal this denial of licensure to the Medical Marihuana Commission within thirty (30)
days of the date of this letter by filing a written statement to the Commission with the City Clerk’s Office.
Should you choose to appeal, your Commission Hearing will be held at 2:00 p.m. on Friday, November 15,
2019. Commission Hearings are held at the Clerk’s Marijuana Licensing Unit, 2500 S Washington Ave,
Lansing, MI 48910.
The Medical Marihuana Commission Appeal will become a matter of public record. The Commission’s review
of the appeal shall not be de novo. The Commission shall only overturn, or modify, a decision or finding of
the Clerk if it finds such decision or finding to be arbitrary or capricious and not supported by material,
substantial, and competent facts on the whole record considered by the Clerk in arriving at such decision or
finding.
Chapter 1300 provides that should the applicant not receive a license, one-half the application fee shall be
returned. This refund will be processed after all appeals are exhausted.
Sincerely,
Chris Swope
Lansing City Clerk
40
Chris Swope, CMMC/MMC
City Clerk
cc: Lansing City Attorney, Lansing Chief of Police
41
Statement of Facts
Weisberger Ventures – 4213 S Cedar St
1. Refer to COL Exhibits – Weisberger Ventures Application with attestations and
General Instructions for Medical Marijuana Applications.
2. Item #6 – Marketing, Advertising and Promotion – Refer to COL Exhibits –
Public Scoring Criteria
3. Item 9 – Refer to COL Exhibit Weisberger Ventures Application and
attachments and Public Scoring Criteria, and scoring insights. Pages removed
from Exhibit B as they were not included in this section of the application: Page
4 to end of Exhibit A
4. Item 10 – Financial Structure and Financing. Applicant’s arguments speak to
the financial condition of the stakeholder please refer to COL Exhibit Public
Scoring Criteria and Scoring Insights. Exhibit C was removed because it contains
information that was not part of this section of the original application.
5. Item 12 – Integration with Grows – the applicant did apply for three grows, the
Clerk does not dispute this. The score given should have been 3 points as the
applications were received prior to denial.
6. Item 13 – Charitable Plans & Strategies – See scoring insights and Public Scoring
Criteria.
7. Item 20 – Total COL Jobs – Provisioning Center Jobs are not counted here,
please refer to Public Scoring Criteria and Scoring Insights.
8. Item 22 – Net Worth – CPA attestation is a compilation without exam or
review. Please refer to attached COL exhibits LARA Advisory Bulletin, and
definition from American Institute for CPAs.
9. Item 25 – Stakeholder Experience Relevant Business – See scoring insights.
10. Item 27 – Impact on Neighborhoods – Distance between PC & Residential
Zoning – please refer to COL Exhibits – Public Scoring Criteria, Scoring Insights,
and GIS Distance Map showing Residential Zoning.
42
11. Item 38 – Morals & Good Order Stakeholder Forms – the applicant did supply
this form for all stakeholders, the Clerk does not dispute this. The score given
should have been 3 points, not two.
Email Attachments
1. Statement of Facts from Clerk
2. Public Scoring Criteria
3. Application with List of Attachments and Attestations
4. Appeal from Weisberger Ventures with Exhibits
5. GIS Distance Map Showing Residential Zoning
6. Score Sheet with Scoring Insights
7. LARA Advisory Bulletin
8. American Institute of CPAs – Compilation Attestation
43
Hilary M. Barnard
Attorney at Law
Page 1 of 7
CITY OF LANSING
OFFICE OF THE CITY CLERK
MARIHUANA BUSINESS LICENSE APPEAL
__________________________________
Date: October 18, 2019
WEISBERGER VENTURES II, LLC
Proposed Location:
4213 S. Cedar St.
Lansing, MI 48910
__________________________________
HEARING OFFICER RECOMMENDATION
This decision is remitted to the Clerk of the City of Lansing by Hearing Officer, Hilary M. Barnard,
Esq., having been read and informed on the issues recommends that in regard to WEISBERGER
VENTURES II, LLC and its license application for a Medical Marihuana Provisioning Center that
the license application remain denied.
FACTS
WEISBERGER VENTURES II, LLC (“Appellant”) applied to the City of Lansing to operate a
Medical Marihuana Provisioning Center within the city limits during Phase 2. This recommendation
follows a timely appeal from Appellant.
By letter dated September 20, 2019, Appellant was informed that its license application was denied.
Appellant was informed that this score eliminated the possibility of scoring in the top five
applications received in phase 2 and it would not be receiving a provisioning center license.
Appellant was also informed that it had the right to appeal the denial within 14 (fourteen) days of
the letter’s date by written statement with grounds for appeal. With the letter, Appellant was
provided a copy of the City of Lansing Provisioning Center Ranking sheet for its business. On the
document, Appellant is able to view the total possible points, its attained points, and scoring insight
statements.
Appellant has point deficiencies in several categories.
Appellant’s Position
Appellant seeks appellate review pursuant to the Lansing ordinance. It argues that its application
was not accurately scored and requests rescoring of its Phase 2 application results.
44
Hilary M. Barnard
Attorney at Law
Page 2 of 7
City Clerk Position
The City Clerk affirms its position on the denial. The City Clerk iterates that application
instructions told applicants to attach all relevant materials to each section that the applicant wanted
considered. The City clarifies that there were errors in Integration With Grows, and that the score
should have been 3 points. Likewise, Appellant should have received 3 points relation to Stakeholder
Forms for morals and good order instead of 2.
APPLICABLE LAW & REASONING
The issue in front of this Hearing Officer is whether Appellant’s Provisioning Center License
Application for the City of Lansing was erroneously denied.
In regard to the issuance of licenses and the appellate process for a license:
“The City Council shall provide, by ordinance, a procedure for the issuance of
licenses and permits. The ordinance shall, to the greatest extent possible, place the
responsibility for the issuance of licenses and permits under one official in order that
persons requesting specific licenses and permits will not have to contact more than
one City office.”1
At the denial of a license under City of Lansing Ordinance No. 1217, an applicant:
May appeal to the city clerk, who shall appoint a hearing officer to hear and evaluate
the appeal and make a recommendation to the clerk. Such appeal shall be taken by
filing with the city clerk, within 14 days after notice of the action complained of has
been mailed to the applicant’s last known address on the records of the city clerk, a
written statement setting forth fully the grounds for the appeal. The clerk shall review
the report and recommendation of the hearing officer and make a decision on the
matter. The clerk’s decision may be further appealed to the commission if applied
for in writing to the commission no later than thirty (30) days from the clerk’s
decision.2
* * *
[The] [r]eview of an appeal shall not be de novo. The commission shall only overturn,
or modify, a decision or finding of the clerk if it finds such decision or finding to be
arbitrary or capricious and not supported by material, substantial, and competent
facts on the whole record considered by the clerk in arriving at such decision or
finding.3
1 See LANSING CITY CLERK’S OFFICE, City of Lansing City Charter (as amended) at 24 (2015) available at:
https://www.lansingmi.gov/DocumentCenter/View/2126/City-Charter?bidId=. In this instance, the license issuance
is handled with the City Clerk’s office.
2 City of Lansing Ordinance No. 1217 Sec. 1300.15(C).
3 Id. at 1300.3(E).
45
Hilary M. Barnard
Attorney at Law
Page 3 of 7
The arbitrary or capricious standard of review is the commission’s review and is adopted by this
Hearing Officer.4 Arbitrary and capricious have generally accepted meanings.5 Arbitrary is "without
adequate determining principle . . . [f]ixed or arrived at through an exercise of will or by caprice,
without consideration or adjustment with reference to principles, circumstances, or significance, . .
. decisive but unreasoned.”6 Capricious is "apt to change suddenly; freakish; whimsical; humorsome.”7
The burden is on the party attacking to affirmatively prove the arbitrary and unreasonable decision.8
This is not to say that a local body may “abrogate constitutional restraints.”9
As to whether an applicant can submit supplemental materials on appeal, the Lansing Ordinance in
Section 1300.5(B) states that “[a] complete application for a license or licenses required by this
chapter shall be made under oath on forms provided by the city clerk and shall contain all of the
following[.]” (emphasis added). The ordinance then enumerates all the documents and information
required for application submission. Per Michigan Court rule, appeals are based on the record
already in place.10 Further, an appellate body will generally not consider issues not raised in or ruled
on by a lower review.11 The appellate review is limited to the record before the lower court at the
time of the relevant decision.
Under the City of Lansing Ordinance No. 1217 Section 1300.5:
(B)(12)(IV) Planned tangible capital investment in the city, including detail related
to the number and nature of applicant’s proposed medical marihuana establishments
in the city and whether the locations of such establishments will be owned or leased;
further, if multiple licenses are proposed, an explanation of the economic benefits to
the city and job creation, if any, to be achieved through the award of such multiple
licenses. Supporting factual data shall be included with the response to this subsection[.]
(emphasis added)
Under the City of Lansing Ordinance No. 1217 Section 1300.6, review of an application will
consider:
(D) In the event that there are more applicants for provisioning center licenses who
meet the minimum requirements set forth in 1300.6(B) than there are licenses
available in either phase one or two, the top scoring twenty (20) applicants in phase
4 There is an inherent binary in license issuance: issued or denied, not a spectrum of decisions. Given that this is a
licensing situation, and that the only prescribed review under Ordinance No. 1217 is arbitrary and capricious, that is
the standard that will be observed here.
5 See Bundo v. Walled Lake, 395 Mich. 679, 703 (1976) (citing United States v. Carmack, 329 U.S. 230, 243 (1946).
6 Id.
7 Id.
8 See e.g., Kropf v. Sterling Heights, 391 Mich. 139, 154 (1974) (citing Janesick v. City of Detroit, 337 Mich. 459
(1953)).
9 Id. at 162.
10 See e.g., MCR 7.105(B)(4); (5)(d) (requiring that the appellate court receive a certified copy of a case’s record and
stating review of a trial court’s decision was for legitimate reason based on “arguable support in the record[.]”)
11 See Napier v. Jacobs, 429 Mich. 222, 232-35 (1987).
46
Hilary M. Barnard
Attorney at Law
Page 4 of 7
one and top scoring five (5) applicants in phase two, shall be eligible to receive
provisioning center licenses in accordance with the assessment, evaluation, scoring,
and ranking procedures established in this chapter[.]
An applicant must have included, inter alia, in its application for a provisioning center license:
A copy of the proposed business plan for the establishment, including, but not
limited to the following: . . . (VII) Financial structure and financing of the proposed
medical marihuana establishments. . . . (17) a location area map, as measured
pursuant to section 1300.13(d) of the medical marihuana establishment and
surrounding area that identifies the relative locations and the distances, as measured
pursuant to Section 1300.13 (A).12
The Lansing Ordinance incorporates provisions and definitions of the Medical Marihuana Facilities
Licensing Act, 2016 PA 281 (as amended) (“MMFLA”) so as to:
“not limit an individual’s or entity’s rights under the [Michigan Medical Marihuana
Act (MMMA)], MMA or the [Michigan Tracking Act (MTA)]” and drafters intended
that “these acts supersede [the] ordinance where there is a conflict.”13
A Lansing applicant must then comply with the MMFLA.14 Pursuant to Sec. 402 of the MMFLA, in
evaluating an applicant for licensure, an applicant’s history of “noncompliance with any regulatory
requirements in this state or any other jurisdiction” will be considered.15 Pursuant to Section 409, a
licensure does not “create or vest any right, title, franchise, or other property interest.”
Here, this Hearing Officer will decline to review any supplemental materials provided by Appellant
in effort to cure application deficiencies. Per requirements in the Lansing Ordinance in Section
1300.5(B) and general state appellate practice, review on appeal is to the record originally provided
and reviewed. See e.g., Napier v. Jacobs, 429 Mich. 222, 232-35 (1987).16 Thus, this review will address
the appeal on Appellant’s first basis and the application as originally provided.
MARKETING, ADVERTISING & PROMOTION
Appellant Argues that its marketing plan stated the type and included samples of signage that would
be used in the proposed location. The Appellant provides further statements that amount to “we
will comply” in its letter but does not show how/when this will occur. Exhibit A appears to be a
12 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.5(B).
13 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.2(C).
14 Id. at Sec. 1300.2(D).
15 MMFLA, MCL § 333.27402(3)(g).
16 In this case it discusses that an “exception that review is permissible ‘to prevent a miscarriage of justice.’” “Most
jurisdictions recognize the authority of an appellate court to review an issue, even where the issue was not preserved,
when some fundamental error would otherwise result in some egregious result.” However, that “such power of review
is to be exercised quite sparingly. Napier, 429 Mich. at 233. Under the facts presented, there is not a fundamental error
so as to trigger exercising supplementing on appeal.
47
Hilary M. Barnard
Attorney at Law
Page 5 of 7
PowerPoint in which Appellant details its social media plans and signs via coupons and billboards.
These are examples of possibilities, not an explanation or a documented plan of implementation.
An examiner, and thus this Hearing Officer, is unable to discern the details of Appellant’s marketing
plan because of its vague nature. Further, there appears to be no budget information related to
marketing provided in this section. There is no basis to award further points in this category.
TANGIBLE CAPITAL
The City defines tangible capital as an asset with a physical form. Thus, only such assets would count
in the calculation. The City considers Tangible Capital Investment to detail how a business is going
to invest its money and assets, not how many of them it has. Also considered in Tangible Capital
are building improvements to the interior and exterior. Not considered are products, packaging,
furniture, or other items that are readily removeable from the establishment. Appellant seems to
have confused this section with the financial resources section, even in its appeal. With its
application, Appellant included “TCI Plan.pdf” when it submitted its application. This pdf is
troubling, because the math does not add up in the cubes for each section. From this documentation
it would be impossible for the examiner to determine what the costs are respectively associated with.
For example, facility construction costs allegedly total $5.2 million, but when the numbers are added
from the box, it results in $2.2 million. What are the additional costs here? It is not the position of
an examiner or this Hearing Officer to explain incorrect math calculations and guess what should
be attributed where.
Further, Appellant argues resources in its argument for Tangible Capital. This is not the section for
which Appellant needs to demonstrate means. Rather, it is a section to demonstrate method and
how the means are allocated. The points actually lost are related to supporting material and
information related to ownership/lease. There is still a lack of information pertaining to building
ownership or a purchase agreement. Based on the information received, the initial score was
appropriate.
FINANCIAL STRUCTURE
Appellant argues the means and credentials and means of the stakeholder. There appears to be no
information provided to correspond with generally acceptable accounting principles (GAAP). Even
considering the stakeholders means, there is no breakdown of how these means will be allocated.
Nor do Appellant’s materials demonstrate how much of that is due on day 1, to whom, and by what
means for startup. Appellant’s argument on appeal focuses again on the means of the stakeholder.
Exhibit C was not part of the original application in this section and cannot be considered for it on
appeal. Thus, there is no basis to award additional points here.
INTEGRATION WITH GROWS
As the City has recommended a point increase in this category, this Hearing Officer is not in a
position to decrease points already afforded to Appellant for scoring errors. Thus, it is recommended
that the score in this category be 3 points.
48
Hilary M. Barnard
Attorney at Law
Page 6 of 7
CHARITABLE PLANS
Here, Appellant argues that a person on behalf of Appellant volunteered many hours on behalf of
the business and that Appellant will done $30,000 per year per facility it operates. Appellant is
lacking any documentation or proof of such arrangements or past practices of the business. Further,
this Hearing Officer is unable to reconcile who the person referenced in Appellant’s letter is. It does
not appear to be the stakeholder, and no nexus was provided. Thus, there is no merit to Appellant’s
argument here.
TOTAL COL JOBS
Appellant argues that it intends to employ up to 220 employees at all of its facilities. It appears,
however, from Appellant’s chart that 15 to 25 jobs will result from this facility. From the City’s
scoring criteria, these jobs are subtracted from the total. From that leaves 100 to 170 jobs being
generated by Appellant’s businesses. The score provided to Appellant reflects this calculation, and
there is no means to revise the score previously received.
NET WORTH
Appellant argues that it submitted the same documents in this category for both of its license
applications, and that this one received 1 point less than the other. The scoring insights provide:
“Has $100K in applicant's (LLC) name. No solid proof of net worth. CPA attestation is a
compilation without exam or review. Doesn't have full documentation of initial start-up and
operating costs. No budget submitted. 9/18/19.” Per the LARA Advisory Bulletin of February 2,
2018, “A compilation is not an attested service . . . and does not meet the attestation requirements
of Rule 11.” A compilation is regularly understood that the CPA did not audit or review the financial
statements, and the CPA does not express an opinion, conclusion or provide any assurance on them.
However, this Hearing Officer agrees that if the same documentation was submitted under this
category for both provisioning center license applications, it is then recommended that the score
should be the same in this category for both applications.17
STAKEHOLDER EXPERIENCE – MARIHUANA BUSINESS
The bar for point allocation in this category is 5 years of combined industry business experience.
Referenced in Appellant’s letter is the stakeholder’s experience as an attorney. As described, it
appears that the stakeholder is involved in the practice of law, not as a marihuana business
proprietor. This category does not ask about tobacco experience, which Appellant highlights in its
argument. There is no argument from Appellant showing marihuana business experience at all.
There is no basis for point allocation in this category.
17 It is entirely possible that the scoring here is more accurate. As such, that would mean the other location’s score
would be reduced by a point to match this. From the information provided with this appeal, this Hearing Officer
recommends only that the scores match and makes no further recommendation. It should be noted that the Appellant
did not address such an argument for its other license appeal, so the category was not addressed in that appeal
recommendation.
49
Hilary M. Barnard
Attorney at Law
Page 7 of 7
IMPACT ON NEIGHBORHOOD (NUMBER 27)
In this category, this Hearing Officer will “give deference to an agency's findings of fact.”18 This
section is not intended to relate to the buffering standards. The City relies on land use
demographics, which find that the property is within ¼ mile of residential zoning. In the scoring
criteria it was explained that this is “[d]istance between residential zoned areas and applicant’s
provisioning center. Evaluation is based on whether any residential property abuts the proposed
location, and if not, whether there is residential zoning within ¼ mile of the proposed location.”19
The argument that Appellant was not aware of this is without merit.
MORALS & GOOD ORDER
This Hearing Officer recommends that the City’s correction to 3 points in this category stand instead
of the original 2. Thus, there is no remaining point deficiency in this category to be so addressed.
CONCLUSION
For the foregoing reasons, it is recommended that Appellant’s score be modified as indicated above.
However, given Appellant’s total score, Appellant’s application for a provisioning center license
should remain denied.
Respectfully Submitted,
Dated: October 18, 2019 _______________________________
Hilary M. Barnard, Hearing Officer
18 Edw. C. Levy Co., 293 Mich. App. at 341 (citing THM, Ltd. v Comm'r of Ins., 176 Mich. App. 772, 776 (1989)).
19 See FINAL Medical Marijuana Provisioning Centers Scoring Criteria,
https://lansingmi.gov/DocumentCenter/View/7907/Final-Phase-2-Criteria---June-14-2019?bidId=. This document has
been readily available on the City’s website: https://lansingmi.gov/1674/Medical-Marijuana-Application-Informatio.
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Timeline
Weisberger Ventures
511 E Hazel St
Lansing, Michigan 48910
June 26, 2019 – Application submitted ................................................................... 2
July 1, 2019 – Department review of applications begins
July 25, 2019 – Distance Maps Created ................................................................. 11
September 19, 2019 – Score & Rank Denial Letter Sent ........................................ 13
October 3, 2019 – Hearing Officer Appeal submitted ........................................... 15
October 8, 2019 – Second Score & Rank Second Denial Letter Sent ..................... 76
October 8, 2019 – Commission Hearing Date Letter Sent ..................................... 77
November 7, 2019 – Commission Appeal Submitted ............................................ 89
Pages 73 & 74 were removed from Exhibit E because they contained information that
wasn’t attached to the Experience section of the application.
FIR1
11 1
Business Information
Annual License Application Fee: $5000.00
One Year License Term
City Codified Ordinances-Chapter 1300)
https://mi-lansing-ci\Acplus.com/171/Business-Licenses
Establishment/DBA Weisberger Ventures 11, LLC dba Green Buddha
Name*
Establishment 248)330-3037
Phone Number
Establishment 511 E Hazel Street
Address*
City* Lansing State* MI
Zip 48912
Applicant Type* r Individual
r Corporation
r LLC
r LLP
Facility Type* r Provisioning Center
r Secure Transporter
r Safety Compliance
r Processor Facility
r Grower
Please initial) I
have filed our 1PDa4t IZWA-t,'t
organizational
documents with the
State of Michigan. (If
individual I have
proof of registration
to do business in
Michigan.)
M CL333.206(3)(iii)(B)
d)*
Applicant/Corporation/LLC/LLP Information - This needs to be where you can be
reached quickly for questions regarding your application.
2
Applicant/Corp/LLC/LUReisberger Ventures II, LLC
Name
Date of Birth (if
Individual)
Establishment Information
Applicant/Corp 248) 330-3037
Phone Number
Secondary Phone (248)647-9999
Number
Contact email paulweisberger@wildbillstobacco.com
address*
Applicant/Corp/LLC/LLPI00 W Maple Road
Address
City Troy State MI
Zip 48084
3
Attachments
Please review the general instructions,which are available at https://Iansingmi.gov/marijuana, prior to
starting.
Ensure that you attach the correct documents to the following buttons.You may attach multiple documents
to a button
Application Documents 1300.05(b)(1). (2). (3). (7). (24)-Please attach the following:
You may download the Stakeholder Information Page here.
Stakeholder 511 -Stakeholder Information.pdf 373.97KB
Information Page(s)
You may download the Operator/Employee Information page here.
Operator/Employee 511 -Operator and employee information.pdf 257.72KB
Information page(s)
Organizational Documents 1300.05(b)(2).(12)(1).(ii).(viii). 1300.06(b)(11- Please attach the following:
LLC, LLP,or Corp Docs.pdf 356.77KB
Corportion Docs
FEIN Verification Weisberger Ventures II, LLC-EIN.pdf 13.26KB
Letter
Ownership Ownership Structure.pdf 78.72KB
Structure
Organization Chart Organization Chart.pdf 189.19KB
Short&Long Term Short Term and Long Term Goals.pdf 126.47KB
Goals
Criminal History 1300.05(b),( 5).(6);1300.06(b)(4)-Please attach one of each for each stakeholder,operator and
employee.
Criminal History 511 -Criminal History.pdf 346.22KB
Background Check
form(s)
Copy of Photo ID(s) Paul Driver's License.pdf 214.09KB
Patient Education Plan 1300.05(b)(9)-Please attach your Patient Education Plan:
Patient Education Final Patient Education Plan.pdf 619.56KB
Plan ASA brochure_HIVAIDS.pdf 337.96KB
ASA brochure_Arthritis[1].pdf 327.84KB
ASA brochure_Cancer.pdf 385.18KB
ASA brochure_Movement_Disorders.pdf 303.36KB
ASA brochure_Veterans_Conditions.pdf 631.46KB
Drug/Alcohol Awareness Plan 1300.05(bl(10)-Please attach your Drug&Alcohol Awareness Plan:
4
Drug and Alcohol Drug and Alcohol Abuse Plan ADAPP(clean) 12 11
Awareness Plan 1.88MB
17.pdf
Worker Training Plan 1300.05(b)(11):1300.05(b)(12)_(vi)- Please attach your Worker Training Plan:
Worker Training Provisioning Center Employee Training&Education
Plan 323.11 KB
Plan (clean) 12 11 17.pdf
Provisioning Center Employee Handbook(clean) 12 652.86KB
11 17.pdf
Marketing.Advertising&Promotion Plan 1300.05(b)(12)(iii):1300.06( b)(1)-Please attach your Marketing,
Advertising&Promotion Plan:
Marketing Marketing Plan.pdf 161.96KB
Advertising & Green Buddha Marketing Strategy 2019.pdf 3.96MB
Promotion Plan
Improvements Made or Proposed to Building 1300.06(b)(3)-Please attach the following:
Plan Improvement proposed to buildings.pdf 93.31KB
Any Supporting GreenBuddha_LansingComplex 0619.pdf 4.89MB
Materials SITE PLAN- 112717[1j.pdf 15.81MB
Tangible Capital Investment 1300.05(b)(12)_(iv):1300.05(b)(13): 1300.06(b)(1)- Please attach any of the following
which apply:
TCI Plan TCI Plan.pdf 144.06KB
Any Supporting
Materials
Document(s) 511 E Hazel-Lease.pdf 3.55MB
demonstrating Property Owner Consent-511.pdf 126.31 KB
ownership or
exclusive lease of
Provisioning Center
Job Creation -Additional Lansing Jobs(1300.05(b)(12)_(v):1300.06(b)(1)-Please attach documentation showing
the number of additional jobs which will be created in the Lansing area at other medical marijuana facility types. Do NOT
include jobs at this provisioning center.
Job Creation (not Other non-provisioning center facilities.pdf 156.09KB
including
Provisioning
Center)
Job Creation -this Provisioning Center ONLY 1300.05(b)(23)-Please attach a plan and any supporting
documentation which includes the following:
Document(s) Staffing and Employee Compensation Plan.pdf 447.17KB
regarding number
of FTE(full time
equivalent)jobs at
the provisioning
center only
5
Projected annual Projected annual budget and revenue.pdf 122.45KB
budget and revenue
at Provisioning
Center only
Percent of 16 and up Staffing and Employee
Employees earning 96.02KB
Compensation.pdfover$15.00/hr
Other Other employment benefits.pdf 91.6KB
Compensation
Financial Structure &Financing 1300.05(b)(12)_(vii): 1300.06(b)(5)- Provide evidence and explanation of the
financial structure and financing for the proposed establishment(s).
Financial Structure Financing Structure and Financing.pdf 126.6KB
Financing
Supporting Lending Agreement dated 6_19_2019.pdf 700.3KB
Documents Lending Agreement dated 6_26_2019.pdf 494.3KB
Luke Dawn Samona PFS-7-31-18.pdf 102.23KB
Paul Weisberger-AUP 6-19-19.pdf 1.69MB
Activity Statement.pdf 115.63KB
Overall Weisberger Ventures II LLC Bank
538.58KB
Balance.pdf
Plan to integrate with a Grow Facility in Lansing 1300.05(b)(12)_(ix): 1300.06(b)(1)- Please attach the following:
Integration Plan Integration Plan.pdf 198.46KB
Supporting SITE PLAN- 112717[1].pdf 15.81 MB
Documents i.e.licenses for other medical marijuana facilities in Lansing or proof of applicaiton for other medical marijuana
facility licenses in Lansing
Community Outreach&Education Plan 1300.05(b)(12)_(x):1300.06(b)(2)-Please attach your plan and any
supporting materials.
Outreach & Provisioning Center Community Outreach, Patient
Education Plan Education and Community Education Plan (clean) 332.88KB
12 11 17.pdf
Charitable Plans&Strategies 1300.05(b)(12)(xi):1300.06( b)(1)-Please attach your plan and any supporting
documents
Charitable Plans& Charitable Giving and Volunteering Plan(clean) 12
Strategies 102.71 KB
11 17.pdf
Charitable Plans Anthony Pellerito Volunteer Log.pdf 329.47KB
Supporting Docs
Security Plan 1300.05(b)(14): 1300.06(b)( 2)- Please attach your security plan and any supporting documents to
ensure compliance with ordinance.
Security Plan and Provisioning Center Safety, Security and Diversion
Supporting 676.51 KB
Prevention Plan (clean) 12 11 17.pdfDocuments
Clearview equipments(511 E Hazel St).pdf 9.25MB
6
Floor Plans 1300.05(b)(15)-Please attach your facility's floor plans.
Floor Plans Cover page.pdf 2.55MB
Equipment- Floor Plan.pdf 4.77MB
Floor Plan-511 E Hazel Street.pdf 1.02MB
SITE PLAN- 112717.pdf 1.01 MB
Proposed Text&Graphics 1300.05(b)(16)-Please attach your facility's plan for outdoor text and graphics.
Proposed Text& GreenBuddhaLogo.pdf 745.6KB
Graphics
Location Area Map 1300.05(b)(17)- Please attach your location's area map.
Location Area Map 511 a hazel location map.pdf 595.05KB
Sanitation&Waste Disposal Plan 1300.05(b)(18)-Please attach your plan.
Sanitation and Provisioning Center Sanitation,Waste, Product
Waste Disposal Plan 468.63KB
Testing and Recall Plan (clean) 12 11 17.pdf
Patient Recordkeeping 1300.05(b)(19)-Please attach your plan for securing patient records.
Patient Provisioning Center Patient Record Keeping Plan
Recordkeeping 350.85KB
clean) 12 11 17.pdf
InventoryRecord keeping-Summary of HIPPA
365.8KB
Privacy Rule.pdf
Testing Procedures(1300.05(b)(20)-Please attach your plan.
Testing Procedures Product Testing and Recall Plan 060419.pdf 285.62KB
Treasury Form(s) 1300.05(b)(4): 1300.05(b)(21)- Please attach the following for each stakeholder.
Completed City of 511 -Treasury Form.pdf 355.34KB
Lansing Treasury
Office Form
Bank Statement(s) 1300.05(b)(22)- Please attach your bank statement(s)showing$100,000 in liquid assets.
Bank Statement(s) Activity Statement.pdf 115.63KB
Overall Weisberger Ventures II LLC Bank
538.58KB
Balance.pdf
Sufficient Financial Resources 1300.05(b)(22) 1300.06(bl(5)-Please attach the following:
Financial Resources 511 -Financial Resources Litigation History.pdf 297.83KB
Litigation Form
Document(s)which Lending Agreement dated 6_19_2019.pdf 700.3KB
support net worth Lending Agreement dated 6_26_2019.pdf 494.3KB
Luke Dawn Samona PFS-7-31-18.pdf 102.23KB
Paul Weisberger-AUP 6-19-19.pdf 1.69MB
Business Experience 1300.05(b)(8): 1300.06(b)( 5)- Please attach the following:7
Resume for Each Paul Weisberger Resume.pdf 23.45KB
Stakeholder
Applicable Licenses Applicable Licenses.pdf 73.89KB
held by Bangor Township Permit.pdf 470.43KB
Stakeholder(s)
Paul Weisberger Bar License.pdf 150.23KB
Real Estate Broker License.pdf 408.73KB
State Operating License and Sale Tax License.pdf 4.41 MB
such as rredical licenses
Insurance Policy 1300.05(B)(26)- Please attach your entire insurance policy or intent to insure.
Insurance Policy Weisberger 511 Hazel.pdf 95.26KB
Proof of Bond or Escrow 1300.05(b)(27)-Please attach a letter of intent to insure from an insurer qualified to do
business in Michigan, or a letter of intent to bond.
Proof of Bond or License Bond-511.pdf 329.78KB
Escrow Account
Traffic Plan 1300.09(i): 1300.06(b)(2).(3);1300.05(b)(15)-Please attach your plan and any supporting materials
example: parking site plan, quotes,traffic analysis,etc.)
Traffic Plan Traffic Plan-511 E Hazel St.pdf 223.79KB
Noise Plan 1300.06(b)( 3):1300.09(i)- Please attach your plan.
Noise Control Plan Traffic Plan-511 E Hazel St.pdf 223.79KB
Odor Plan 1300.06(b)(3): 1300.09(i)-Please attach your plan for odor control.
Odor Plan Provisioning Center Odor Control Plan (clean) 12 11 203.87KB
17.pdf
Applicant-Stakeholder History 1300.06(b)(1).(4).(5):1300.08(e). MCL 333.27401;MCL 333.27402(3)(a). (b).(c):
MCL 333.27405
SOM Pre- Prequalification Status Letter-ERGA-18-
qualification Letter 64.38KB
001032.pdf
Morals, Good Order 511 -Morals, Good Order, and General Welfare
General Welfare 305.62KB
Litigation.pdf
Litigation History
Form for each
Stakeholder
8
Affirmations
Please affirm each of the following statements by entering your initials in the box for each
statement. (You may select a font or draw your initials.)
I affirm that I,the applicant,and each stakeholder and employee is at least 18 years of age and has not been convicted
of or pled guilty or no contest to a disqualifying felony. 1300.05(b)(4)
Initial here:*
I affirm that I,the applicant or operator: 1300(b)(7)
Choose one* r have not had a business license revoked or suspended
r have had a business license revoked or suspended
Initial here*
I acknowledge that I,the applicant, am aware that all matters related to marijuana,growing,cultivation, possession,
dispensing,testing,safety compliance,transporting, distribution,and use are currently subject to State and Federal
Laws, Rules,and Regulations, and that the approval or granting of a license hereunder does not exonerate or
exculpate myself,the applicant,from abiding by the provisions and requirements and penalties associated with those
laws, rules,and regulations or exposure to any penalties associated therewith;and further myself,the applicant,waives
and forever releases any claim,demand, action, legal redress, or recourse against the City of Lansing, its elected and
appointed Officials and its Employees and Agents for any claims, damages, liabilities,causes a result of the violation by
myself,the applicant, its Officials, members, partners,shareholders, employees and agent of those laws, rules,and
regulations and hereby waives and assumes the risk of any such claims and damages,and lack of recourse against the
City of Lansing, its elected and appointed Officials, employees, attorneys,and agents 1300.05(b)(24)
Initial here:*
may
I swear that neither I,the applicant, nor any stakeholder is in default to the City of Lansing for failure to pay any
property taxes,special assessments,fines,fees or other financial obligations to the City 1300.05(b)( 21)
Initial here:*
I agree to report any changes to the information required under Chapter 1300 to the City Clerk within ten (10)business
days 1300.08(d).
Initial here:*
may
By submitting this application for a medical marijuana license, I affirm: (1)that I have read and understand Ordinance
1217 and the instructions for this application, (2)that I have submitted a complete application, and (3)that I have
submitted all documents that will be considered for each section of the application.;A document should be uploaded to
each applicable scoring section;failure to do so may impact the completeness and/or score of your application.
9
Initial here:*
10
11
12
13
September 19, 2019
Weisberger Ventures LLC
Paul Weisberger
211 E Nine Mile Road Unit 313
Ferndale, Michigan 48220
Dear Provisioning Center Applicant,
The Lansing City Ordinance section 1300.6 discusses Provisioning Center license application evaluation. Your score of 75.5 out of 100 eliminates the possibility of scoring in the top five. Therefore, your application for licensure is denied.
Attached are your sub-scores based on the criteria posted on https://lansingmi.gov/1637/Medical-Marijuana and a brief
summary of determining factors for each sub-score. You will not be selected to receive a Provisioning Center license in the City of Lansing for the proposed business at 511 E Hazel Street.
You have the right to appeal this denial of licensure within 14 days of the date of this letter by filing with the City Clerk’s
Office a written statement setting forth fully the grounds for the appeal pursuant to Chapter 1300.15(c). Please note that
initial appeals are referred to a hearing officer appointed by the City Clerk who will review the appeal and information
submitted. The hearing officer will consider the information and make a recommendation to the City Clerk, who will make
a decision on the appeal. To encourage efficiency, appeals will be conducted as a paper hearing without oral
presentation. Please ensure that you include all information in your written appeal that you would like the hearing officer
to consider. Appeals are limited to materials provided during the application process. No new application material will
be considered on appeal.
Chapter 1300 provides that should the applicant not receive a license, one-half the application fee shall be returned.
This refund will be processed after all appeals are exhausted.
Sincerely,
Chris Swope, CMMC/MMC
Lansing City Clerk
CC: City Attorney
Lansing Police Department
Chris Swope
Lansing City Clerk
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October 8, 2019
Weisberger Ventures, LLC
Paul Weisberger
211 E 9 Mile Rd, Unit 313
Ferndale, MI 48220-1968
Dear Provisioning Center Applicant,
I have reviewed the report and recommendation of the hearing officer on your appeal of the Scoring and
Ranking denial of your application to operate a Medical Marihuana Provisioning Center in the City of Lansing
at 511 E Hazel St. I have determined that your appeal is denied.
You have the right to appeal this denial of licensure to the Medical Marihuana Commission within thirty (30)
days of the date of this letter by filing a written statement to the Commission with the City Clerk’s Office.
Should you choose to appeal, your Commission Hearing will be held at 2:00 p.m. on Friday, November 15,
2019. Commission Hearings are held at the Clerk’s Marijuana Licensing Unit, 2500 S Washington Ave,
Lansing, MI 48910.
The Medical Marihuana Commission Appeal will become a matter of public record. The Commission’s review
of the appeal shall not be de novo. The Commission shall only overturn, or modify, a decision or finding of
the Clerk if it finds such decision or finding to be arbitrary or capricious and not supported by material,
substantial, and competent facts on the whole record considered by the Clerk in arriving at such decision or
finding.
Chapter 1300 provides that should the applicant not receive a license, one-half the application fee shall be
returned. This refund will be processed after all appeals are exhausted.
Sincerely,
Chris Swope, CMMC/MMC
City Clerk
cc: Lansing City Attorney, Lansing Chief of Police
Chris Swope
Lansing City Clerk
77
City of Lansing Provisioning Center Ranking 10/8/2019 12:08 PM
Total
Possible
Points
Weisberger Ventures-511 E Hazel St
---
#Category ---Score Location of material Scoring Insights
1 Ownership Structure 1 1 Org Docs, Ownership Struc., 1 pg.Has ownership structure. 8/23/19
2 Organizational Chart 1 1 Org Docs, Org Chart, 5 pgs.Has org chart. 8/23/19
3 Worker Training Program 1 1 Other Required Documents, Worker Training Plan 40 pgs.Has plan. 8/23/19
4 Short and Long Term Goals and
Objectives 1 1 Org Docs, Goals, 1 pg.Has goals. 8/23/19
5 Community Outreach &
Education 1 1 Community Outreach, Outreach & Education 15 pgs.Has plan. 8/23/19
6 Marketing, Advertising &
Promotion 3 0 Marketing
No examples of minor minimization. Statement that they will not sell to minors with no detail. The
marketing plan appears to have been prepared for a proposed location in Madison Heights. No budget.
9/19/19
7 Tangible Capital Investment
Dollar Amount 5 5 3 page Investment Plan Stated TCI is $5,200,000.00. 9/19/19
8 Tangible Capital Investment
Own/Lease 3 1 9 pages Lease with Permission Lease and landlord permission provided. 8/20/19
9 Tangible Capital Investment
Supporting Material 3 0 Nothing submitted No support documents attached. 8/20/19
10 Financial Structure & Financing 2 0 Nothing submitted No GAAP operating or startup budget attached. 8/23/19
11 LARA Pre-Qual 3 3 Demo of Reg Compliance Has prequalification letter dated 12/10/2018 for Weisberger Ventures II, LLC 8/23/19
12 Integration with Grows 4 3 Integrate Has plans to open a grow and processor in Lansing. Applied for 3 Class C grow licenses. 9/19/19
13 Charitable Plans & Strategies 4 3 Charity $30K per year. No receipts or proof in form of signed agreement. 8/23/19
14 Number of and job descriptions
for PC ONLY 3 3 Job Creation More than six (6) jobs. Has detailed job descriptions. 8/23/19
15 Healthcare 2 2 Job Creation Employer will provide healthcare. 8/23/19
16 Paid Time Off 1 1 Job Creation Employer will offer paid time off. 8/23/19
17 Retirement 1 1 Job Creation Employer will offer 401K program. 8/23/19
18 % of employees at $15+/hr 3 3 Job Creation 100% of employees will make $15+/hr.
19 Projected Annual Budget 2 0 Nothing submitted No GAAP operating budget attached. 8/23/19
20 Total COL Jobs 6 5 Job Creation 170 jobs. All but 20 come from grows. Less than ideal number of jobs, which is 201+. 9/19/19
Total Business Plan &
Job Creation 50 35
21 Financial Litigation History 1 1 Financial Litigation Form Has completed form(s) for all stakeholders. 9/19/19
22 Net Worth 3 2 22 Unduplicated pages in Finance Section Has $100K in a bank account in the applicant’s name. Has solid proof of net worth. No budget,
therefore doesn’t have full documentation of initial start-up and operating costs. 9/19/19
23 LARA Pre-Qual 3 3 Demo of Reg Compliance Has prequalification letter dated 12/10/2018 for Weisberger Ventures II, LLC 8/23/19
24 Stakeholder Experience
City of Lansing Businesses 1 0 Experience No mention of Lansing business ownership. 8/23/19
25 Stakeholder Experience
Relevant Businesses 1 0 Experience No relevant medical, agricultural or retail business experience. 9/19/19
26 Stake Holder Experience
Medical Marijuana Business 1 1 Experience More than five (5) years MM experience. 9/19/19
Total Financial Stability
&
Business Experience
10 7
178
City of Lansing Provisioning Center Ranking 10/8/2019 12:08 PM
27 Impact on Neighborhood
Distance Between PC &
Residential Zoning 7 5
https://lansing.maps.arcgis.com/apps/webapp
viewer/index.html?id=be0634345255438ba55
b14c9b19e9f22
PC Property does not abut Residential Zoning. However there is residential zoning within 1/4.
7/25/19
28 Impact on Neighborhood
Density of PCs 7 4.5 https://lansing.maps.arcgis.com/apps/webapp
viewer/index.html?id=be0634345255438ba55
b14c9b19e9f22
Lose 2 points for every existing PC within a 1/2 mile radius. None
Lose 1 point for every existing PC within a 1 mile radius. None
Lose .5 point for every existing PC within a 1.5 mile radius. #16, #17, #18, #19
Lose .25 point for every existing PC within a 2 mile radius. #8, #15
Lost 2.5 points. 8/23/19
29 Traffic & Parking 3 3 Public Service Review Tier 1 excellent parking and circulation 9/3/19
30 Security Plan 3 3 LPD Review Tier I - Equip specs, guard, vault, barrier vestibule, off site video storage, alarms with panic button.
9/3/19
Total - Land Use &
Resident Safety 20 15.50
31 Planned Outreach 1 1 Community Outreach, Outreach & Education 15 pgs.Has plan. 8/23/19
32 Improvements to Building 3 2 Proposed Improvements
Improvements Plan
SEV-$71,500
$4,800,000 proposed improvements (includes processor and grower suites).
6713% of SEV
One point deduction for lack of supporting materials. (quotes/bids) 8/29/19
33 Plan to Minimize Traffic 1 1 Traffic
Traffic Plan Has a plan. 8/29/19
34 Noise Plan 1 1 Noise & Odor Has a plan. 8/23/19
35 Odor Plan 4 3 Noise & Odor Has a detailed plan, but no equipment specs or budget/quotes. 8/23/19
Total Outreach 10 8
36 Stakeholder History
Proof of LARA Prequal 2 2 Demo of Reg Compliance Has prequalification letter dated 12/10/2018 for Weisberger Ventures II, LLC 8/23/19
37 Demo of Regulatory
Compliance 5 5
https://bsaonline.com/SiteSearch/SiteSearchD
etails?SearchFocus=All+Records&SearchCateg
ory=Address&SearchText=511+e+hazel&uid=3
84&PageIndex=1&ReferenceKey=33-01-01-21-
231-
032&ReferenceType=0&SortBy=&SearchOrigin
=0&RecordKeyDisplayString=33-01-01-21-231-
032&RecordKey=1%3d33-01-01-21-231-
032%3a%3a4%3d33-01-01-21-231-
032%3a%3a7%3d522ae8b0-e6b2-4804-8e14-
9f28012e8a96&RecordKeyType=1%3d0%3a%3
a4%3d0%3a%3a7%3d2
No code violations. No conditional denial letters. 9/19/19
38 Morals, Good Order & General
Welfare Litigation History 3 3 Demo of Reg Compliance Has completed form(s) for all stakeholders. 9/19/19
Total Applicant
Stakeholder History 10 10
Total Score 100 75.50
279
Statement of Facts
Weisberger Ventures – 511 E Hazel St
1. Argument made on whether all information in application should be considered. The City
Clerk’s Office instructed applicants to attach all relevant materials to each section the applicant
wanted the information to be considered. The applicant signed an attestation indicating they
understood their score would be impacted if they failed to do so. Different examiners worked
on different sections and only considered those items included with the section they were
evaluating. See COL Exhibits – Weisberger Ventures Application with attestations and General
Instructions for Medical Marijuana Applications.
2. Item #6 – Marketing, Advertising and Promotion – Statements are not examples. We are
looking for examples with detailed explanation.
3. Item 9 – Tangible Capital Investment Supporting Documents – Applicant has improperly
labeled this as Dollar Amount. Dollar Amount was considered in Item 7. Applicant refers to
finances, which is not what this category is about. Tangible Capital Investment is how you are
going to spend the money you are investing, not how much you have. Tangible Capital is the
building and permanent improvements you make to the property, interior and exterior. It does
not include things like product, packaging, furniture, or other removable items. Supporting
material is defined as Purchase Agreements for property and quotes/bids/invoices from
contractors or suppliers. Refer to Application and attachments under this section.
4. Item 10 – Financial Structure and Financing. Applicant’s arguments speak to the financial
condition of the stakeholder. That information is included however, without at GAAP Budget
for startup costs there is no way for the reviewer to determine if finances are sufficient to cover
those costs.
5. Item 12 – Integration with Grows – the applicant did apply for three grows, the Clerk does
not dispute this. The score given was appropriate for that number of grow applications.
6. Item 13 – Charitable Plans & Strategies – See scoring insights. Lacks proof in form of signed
agreements with proposed charities – or receipt for amount given to date. The proof of
volunteer work is not in the name of the stakeholder.
7. Item 20 – Total COL Jobs – Provisioning Center Jobs are not counted here, as is made clear in
the public scoring criteria. Therefore the number of jobs is between 100-170 and the scoring
reflects this. Criteria from public sheet: “Number of additional jobs created by your
stakeholders within the City of Lansing at other medical marijuana facilities types.
(Grower/Processor)”
8. Item 25 – Stakeholder Experience Relevant Business – See scoring insights.
80
9. Item 27 – Impact on Neighborhoods – Distance between PC & Residential Zoning – This
category is not buffering, nor is it related to any zoning buffering. Applications which do not
meet basic zoning requirements are denied for that specific reason. Applicant was aware of this
scoring requirement. Public criteria states, “Surrounding Neighborhoods: Distance between
residential zoned areas and applicant's provisioning center. Evaluation is based on whether any
residential property abuts the proposed location, and if not, whether there is residential zoning
within 1/4 mile of the proposed location.” Score was appropriate for a facility with residential
zoning within 1/4 mile.
COL Exhibits
1. Statement of Facts from Clerk
2. Application with attestations
3. Appeal from Weisberger Ventures
4. GIS Distance Map Showing Residential Zoning
5. Score Sheet with Scoring Insights
81
Hilary M. Barnard
Attorney at Law
Page 1 of 7
CITY OF LANSING
OFFICE OF THE CITY CLERK
MARIHUANA BUSINESS LICENSE APPEAL
__________________________________
Date: October 8, 2019
WEISBERGER VENTURES II, LLC
Proposed Location:
511 E. Hazel St.
Lansing, MI 48912
__________________________________
HEARING OFFICER RECOMMENDATION
This decision is remitted to the Clerk of the City of Lansing by Hearing Officer, Hilary M. Barnard,
Esq., having been read and informed on the issues recommends that in regard to WEISBERGER
VENTURES II, LLC and its license application for a Medical Marihuana Provisioning Center that
the license application remain denied.
FACTS
WEISBERGER VENTURES II, LLC (“Appellant”) applied to the City of Lansing to operate a
Medical Marihuana Provisioning Center within the city limits during Phase 2. This recommendation
follows a timely appeal from Appellant.
By letter dated September 20, 2019, Appellant was informed that its license application was denied
because of its score and rank, having received a score of 75.5 out of 100. Appellant was informed
that this score eliminated the possibility of scoring in the top five applications received in phase 2
and it would not be receiving a provisioning center license. Appellant was also informed that it had
the right to appeal the denial within 14 (fourteen) days of the letter’s date by written statement with
grounds for appeal. With the letter, Appellant was provided a copy of the City of Lansing Provisioning
Center Ranking sheet for its business. On the document, Appellant is able to view the total possible
points, its attained points, and scoring insight statements.
Appellant has point deficiencies in several categories.
Appellant’s Position
Appellant seeks appellate review pursuant to the Lansing ordinance. It argues that its application
was not accurately scored and requests immediate rescoring of its Phase 2 application results.
82
Hilary M. Barnard
Attorney at Law
Page 2 of 7
City Clerk Position
The City Clerk affirms its position on the denial. The City Clerk iterates that application
instructions told applicants to attach all relevant materials to each section that the applicant wanted
considered. Additionally, the City argues that the Appellant signed an attestation indicating that it
understood the score would be impacted if it failed to include such materials.
APPLICABLE LAW & REASONING
The issue in front of this Hearing Officer is whether Appellant’s Provisioning Center License
Application for the City of Lansing was erroneously denied.
In regard to the issuance of licenses and the appellate process for a license:
“The City Council shall provide, by ordinance, a procedure for the issuance of
licenses and permits. The ordinance shall, to the greatest extent possible, place the
responsibility for the issuance of licenses and permits under one official in order that
persons requesting specific licenses and permits will not have to contact more than
one City office.”1
At the denial of a license under City of Lansing Ordinance No. 1217, an applicant:
May appeal to the city clerk, who shall appoint a hearing officer to hear and evaluate
the appeal and make a recommendation to the clerk. Such appeal shall be taken by
filing with the city clerk, within 14 days after notice of the action complained of has
been mailed to the applicant’s last known address on the records of the city clerk, a
written statement setting forth fully the grounds for the appeal. The clerk shall review
the report and recommendation of the hearing officer and make a decision on the
matter. The clerk’s decision may be further appealed to the commission if applied
for in writing to the commission no later than thirty (30) days from the clerk’s
decision.2
* * *
[The] [r]eview of an appeal shall not be de novo. The commission shall only overturn,
or modify, a decision or finding of the clerk if it finds such decision or finding to be
arbitrary or capricious and not supported by material, substantial, and competent
facts on the whole record considered by the clerk in arriving at such decision or
finding.3
1 See LANSING CITY CLERK’S OFFICE, City of Lansing City Charter (as amended) at 24 (2015) available at:
https://www.lansingmi.gov/DocumentCenter/View/2126/City-Charter?bidId=. In this instance, the license issuance
is handled with the City Clerk’s office.
2 City of Lansing Ordinance No. 1217 Sec. 1300.15(C).
3 Id. at 1300.3(E).
83
Hilary M. Barnard
Attorney at Law
Page 3 of 7
The arbitrary or capricious standard of review is the commission’s review and is adopted by this
Hearing Officer.4 Arbitrary and capricious have generally accepted meanings.5 Arbitrary is "without
adequate determining principle . . . [f]ixed or arrived at through an exercise of will or by caprice,
without consideration or adjustment with reference to principles, circumstances, or significance, . .
. decisive but unreasoned.”6 Capricious is "apt to change suddenly; freakish; whimsical; humorsome.”7
The burden is on the party attacking to affirmatively prove the arbitrary and unreasonable decision.8
This is not to say that a local body may “abrogate constitutional restraints.”9
As to whether an applicant can submit supplemental materials on appeal, the Lansing Ordinance in
Section 1300.5(B) states that “[a] complete application for a license or licenses required by this
chapter shall be made under oath on forms provided by the city clerk and shall contain all of the
following[.]” (emphasis added). The ordinance then enumerates all the documents and information
required for application submission. Per Michigan Court rule, appeals are based on the record
already in place.10 Further, an appellate body will generally not consider issues not raised in or ruled
on by a lower review.11 The appellate review is limited to the record before the lower court at the
time of the relevant decision.
Under the City of Lansing Ordinance No. 1217 Section 1300.5:
(B)(12)(IV) Planned tangible capital investment in the city, including detail related
to the number and nature of applicant’s proposed medical marihuana establishments
in the city and whether the locations of such establishments will be owned or leased;
further, if multiple licenses are proposed, an explanation of the economic benefits to
the city and job creation, if any, to be achieved through the award of such multiple
licenses. Supporting factual data shall be included with the response to this subsection[.]
(emphasis added)
Under the City of Lansing Ordinance No. 1217 Section 1300.6, review of an application will
consider:
(D) In the event that there are more applicants for provisioning center licenses who
meet the minimum requirements set forth in 1300.6(B) than there are licenses
available in either phase one or two, the top scoring twenty (20) applicants in phase
4 There is an inherent binary in license issuance: issued or denied, not a spectrum of decisions. Given that this is a
licensing situation, and that the only prescribed review under Ordinance No. 1217 is arbitrary and capricious, that is
the standard that will be observed here.
5 See Bundo v. Walled Lake, 395 Mich. 679, 703 (1976) (citing United States v. Carmack, 329 U.S. 230, 243 (1946).
6 Id.
7 Id.
8 See e.g., Kropf v. Sterling Heights, 391 Mich. 139, 154 (1974) (citing Janesick v. City of Detroit, 337 Mich. 459
(1953)).
9 Id. at 162.
10 See e.g., MCR 7.105(B)(4); (5)(d) (requiring that the appellate court receive a certified copy of a case’s record and
stating review of a trial court’s decision was for legitimate reason based on “arguable support in the record[.]”)
11 See Napier v. Jacobs, 429 Mich. 222, 232-35 (1987).
84
Hilary M. Barnard
Attorney at Law
Page 4 of 7
one and top scoring five (5) applicants in phase two, shall be eligible to receive
provisioning center licenses in accordance with the assessment, evaluation, scoring,
and ranking procedures established in this chapter[.]
An applicant must have included, inter alia, in its application for a provisioning center license:
A copy of the proposed business plan for the establishment, including, but not
limited to the following: . . . (VII) Financial structure and financing of the proposed
medical marihuana establishments. . . . (17) a location area map, as measured
pursuant to section 1300.13(d) of the medical marihuana establishment and
surrounding area that identifies the relative locations and the distances, as measured
pursuant to Section 1300.13 (A).12
The Lansing Ordinance incorporates provisions and definitions of the Medical Marihuana Facilities
Licensing Act, 2016 PA 281 (as amended) (“MMFLA”) so as to:
“not limit an individual’s or entity’s rights under the [Michigan Medical Marihuana
Act (MMMA)], MMA or the [Michigan Tracking Act (MTA)]” and drafters intended
that “these acts supersede [the] ordinance where there is a conflict.”13
A Lansing applicant must then comply with the MMFLA.14 Pursuant to Sec. 402 of the MMFLA, in
evaluating an applicant for licensure, an applicant’s history of “noncompliance with any regulatory
requirements in this state or any other jurisdiction” will be considered.15 Pursuant to Section 409, a
licensure does not “create or vest any right, title, ,franchise, or other property interest.”
Here, this Hearing Officer will decline to review any supplemental materials provided by Appellant
in effort to cure application deficiencies. Per requirements in the Lansing Ordinance in Section
1300.5(B) and general state appellate practice, review on appeal is to the record originally provided
and reviewed. See e.g., Napier v. Jacobs, 429 Mich. 222, 232-35 (1987).16 Thus, this review will address
the appeal on Appellant’s first basis and the application as originally provided.
MARKETING, ADVERTISING & PROMOTION
Appellant Argues that its marketing plan stated the type and included samples of signage that would
be used in the proposed location. The Appellant provides further statements that amount to “we
will comply” in its letter but does not show how/when this will occur. Exhibit A appears to be a
12 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.5(B).
13 City of Lansing, Michigan Ordinance No. 1217 Sec. 1300.2(C).
14 Id. at Sec. 1300.2(D).
15 MMFLA, MCL § 333.27402(3)(g).
16 In this case it discusses that an “exception that review is permissible ‘to prevent a miscarriage of justice.’” “Most
jurisdictions recognize the authority of an appellate court to review an issue, even where the issue was not preserved,
when some fundamental error would otherwise result in some egregious result.” However, that “such power of review
is to be exercised quite sparingly. Napier, 429 Mich. at 233. Under the facts presented, there is not a fundamental error
so as to trigger exercising supplementing on appeal.
85
Hilary M. Barnard
Attorney at Law
Page 5 of 7
PowerPoint in which Appellant details its social media plans and signs via coupons and billboards.
These are examples of possibilities, not an explanation or a documented plan of implementation.
An examiner, and thus this Hearing Officer, is unable to discern the details of Appellant’s marketing
plan because of its vague nature. There is no basis to award further points in this category.
TANGIBLE CAPITAL
The City defines tangible capital as an asset with a physical form. Thus, only such assets would count
in the calculation. The City considers Tangible Capital Investment to detail how a business is going
to invest its money and assets, not how many of them it has. Also considered in Tangible Capital
are building improvements to the interior and exterior. Not considered are products, packaging,
furniture, or other items that are readily removeable from the establishment. Appellant seems to
have confused this section with the financial resources section, even in its appeal. With its
application, Appellant included “TCI Plan.pdf” when it submitted its application. This pdf is
troubling, because the math does not add up in the cubes for each section. From this documentation
it would be impossible for the examiner to determine what the costs are respectively associated with.
For example, facility construction costs allegedly total $5.2 million, but when the numbers are added
from the box, it results in $2.2 million. What are the additional costs here? It is not the position of
an examiner or this Hearing Officer to explain incorrect math calculations and guess what should
be attributed where.
Further, Appellant argues resources in its argument for Tangible Capital. This is not the section for
which Appellant needs to demonstrate means. Rather, it is a section to demonstrate method and
how the means are allocated. Based on the information received, the initial score was appropriate.
FINANCIAL STRUCTURE
Appellant argues the means and credentials and means of the stakeholder. There appears to be no
information provided to correspond with generally acceptable accounting principles (GAAP). Even
considering the stakeholders means, there is no breakdown of how these means will be allocated.
Nor do Appellant’s materials demonstrate how much of that is due on day 1, to whom, and by what
means for startup. Thus, there is no basis to award additional points here.
INTEGRATION WITH GROWS
It is undisputed between the City and Appellant that Appellant has applied for 3 other locations.
This score is consistent with the City’s standard for this category. A factfinder must give deference
to an agency's findings of fact.”17 The factfinder may not set aside findings just because other facts
in the record could have come to a different conclusion.18 Thus, there is no basis to award additional
points here.
17 Edw. C. Levy Co. v. Marine City Zoning Bd., 293 Mich. App. 333, 341 (2011) (citing THM, Ltd. v Comm'r of Ins.,
176 Mich. App. 772, 776 (1989)).
18 Id.
86
Hilary M. Barnard
Attorney at Law
Page 6 of 7
CHARITABLE PLANS
Here, Appellant argues that a person on behalf of Appellant volunteered many hours on behalf of
the business and that Appellant will done $30,000 per year per facility it operates. Appellant is
lacking any documentation or proof of such arrangements or past practices of the business. Further,
this Hearing Officer is unable to reconcile who the person referenced in Appellant’s letter is. It does
not appear to be the stakeholder, and no nexus was provided. Thus, there is no merit to Appellant’s
argument here.
TOTAL COL JOBS
Appellant argues that it intends to employ up to 220 employees at all of its facilities. It appears,
however, from Appellant’s chart that 15 to 25 jobs will result from this facility. From the City’s
scoring criteria, these jobs are subtracted from the total. From that leaves 100 to 170 jobs being
generated by Appellant’s businesses. The score provided to Appellant reflects this calculation, and
there is no means to revise the score previously received.
STAKEHOLDER EXPERIENCE – MARIHUANA BUSINESS
The bar for point allocation in this category is 5 years of combined industry business experience.
Referenced in Appellant’s letter is the stakeholder’s experience as an attorney. As described, it
appears that the stakeholder is involved in the practice of law, not as a marihuana business
proprietor. This category does not ask about tobacco experience, which Appellant highlights in its
argument. Appellant also fails to clarify or explain about its Bangor Township business but provides
a statement about it. There is no argument from Appellant showing marihuana business experience
at all. There is no basis for point allocation in this category.
IMPACT ON NEIGHBORHOOD (NUMBER 27)
In this category, this Hearing Officer will “give deference to an agency's findings of fact.”19 This
section is not intended to relate to the buffering standards. The City relies on land use
demographics, which find that the property is within ¼ mile of residential zoning. In the scoring
criteria it was explained that this is “[d]istance between residential zoned areas and applicant’s
provisioning center. Evaluation is based on whether any residential property abuts the proposed
location, and if not, whether there is residential zoning within ¼ mile of the proposed location.”20
The argument that Appellant was not aware of this is without merit.
19 Edw. C. Levy Co., 293 Mich. App. at 341 (citing THM, Ltd. v Comm'r of Ins., 176 Mich. App. 772, 776 (1989)).
20 See FINAL Medical Marijuana Provisioning Centers Scoring Criteria,
https://lansingmi.gov/DocumentCenter/View/7907/Final-Phase-2-Criteria---June-14-2019?bidId=. This document
has been readily available on the City’s website: https://lansingmi.gov/1674/Medical-Marijuana-Application-
Informatio.
87
Hilary M. Barnard
Attorney at Law
Page 7 of 7
CONCLUSION
For the foregoing reasons, it is recommended that Appellant’s application for a provisioning center
license remain denied.
Respectfully Submitted,
Dated: October 8, 2019 _______________________________
Hilary M. Barnard, Hearing Officer
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