WATSONVILLE—In a decision that will likely head to the Watsonville City Council for another heated debate, the Planning Commission on Tuesday voted 4-3 to deny an appeal from a cannabis company that cried foul after missing out on one of the city’s three dispensary licenses.
Greater Goods Marketplace LLC, a company established by Santa Cruz Naturals founder and CEO Colin Disheroon, finished fourth of 12 applicants in the city’s pre-application process for potential retail cannabis businesses.
But Disheroon and Co. have now raised questions about the interview procedures and scoring metrics in the third phase of the four-phase process after scoring far lower than they did in phase two, putting them out of the running for one of the three new retail licenses recently approved by the City Council.
The city, however, says that Greater Goods went through the same “fair, transparent and competitive” process every other finalist did, and that it had to make a tough decision between multiple qualified candidates.
During the second phase, HdL Companies, a cannabis consultant hired by the city, looked over documents submitted by each applicant, and scored them on various aspects of their business, including how they would benefit the community and their overall business plan.
In the ensuing phase, applicants underwent an interview conducted by the city’s Cannabis Selection Committee. That group included: Community Development Director Suzi Merriam, Assistant Police Chief Tom Sims, finance director Cindy Czerwin, Fire Department representative Kirt Vojvoda and City Manager Office representative Elizabeth Padilla.
After scoring the highest of any company in the second phase, Greater Goods recorded the fourth-highest score in the phase-three interview. The fourth phase combines the scores in the second and third phase to determine the final score for each applicant.
Disheroon says that the city’s decision to abruptly move interviews from a virtual format to in-person during the height of the pandemic in January caught his team off guard and put them at a disadvantage. Because of that shift 10 days before the interview, Disheroon says, Greater Goods stepped into the meeting without its CFO, who did not attend for fear of contracting Covid-19. Other team members with disabilities were also negatively impacted by the move to in-person, Disheroon says.
“We still don’t understand the need or logic of this decision,” Disheroon said in a statement during Tuesday’s virtual meeting.
Merriam said HdL advised staff to conduct the phase three interviews in-person to make sure no applicants would have an unfair advantage, and so that they could choose the business that best fit the community.
“We were looking at what the best fit for the city is in addition to all of what was in the written application,” she said. “There was a lot more that went into it [in phase three].”
Disheroon filed the appeal on March 2. In the five-page letter, he asked the city to either reassess Greater Goods’ phase three score and disclose the scoring breakdown from that phase, or give the company a cultivation license so that their proposed three-pronged cannabis microbusiness at a property on Hangar Way—which they had preemptively purchased through an investor—would “pencil out.” Greater Goods finished first in the pre-application process for cannabis licenses in distribution and manufacturing.
Most commissioners also questioned the city’s logic of moving to in-person interviews while Covid-19 was raging in Watsonville, but their ultimate decision was not about the process used. They were only tasked with determining if there was enough evidence to say that the city had made an error with its final scores.
Commissioners Gina Cole, Daniel Dodge and Lucy Rojas voted against upholding the selection committee’s decision after nearly two hours of discussion.
Disheroon said on Tuesday that he would likely appeal to the City Council if the Planning Commission ruled against him.
