Thinking about opening a weed business in Merced? Here’s what leaders want to allow

Merced is looking at how many marijuana business it wants in town, and how strictly dispensaries and related businesses should be treated.

Leaders showed support for allowing marijuana distributors, testers and some manufacturers. Most of them remain skeptical about hash bars, and commercial cultivation is a no-go.

Merced City Council and the Planning Commission met in a joint session Wednesday to try to hammer out the city’s approach to all of the businesses.

The City Council has already approved four medical marijuana dispensaries, but those dispensaries would not sell recreational weed. The dispensaries are also only allowed in commercial offices, similar to those used by dentists and doctors.

The four dispensary licenses are likely to be awarded by a hybrid system that would be partly merit-based and partly by lottery, a plan generally supported by city leaders.

“We’re asking staff to come up with a special permitting process,” Mayor Mike Murphy said.

Previously not allowed, the leaders showed support for allowing marijuana distribution and testing centers. Manufacturing could also potentially be allowed. Those types of businesses generally don’t draw criminal activity, according to Neil Hall, Merced’s marijuana consultant from Fairfield-based SCI Consulting Group.

“Other than a moral objection, we don’t see anything that would make us say ‘you got to watch out for this,’ ” he said.

Earlier this year, Hall said Merced stands to make as much as an estimated $1.6 million a year in marijuana tax revenue if it allows recreational marijuana.

A number of council members and commissioners said the city may need to allow more dispensaries and loosen the zoning rules.

Planning Commissioner Bill Baker called recreational marijuana a “game-changer.” He said the city should allow for more dispensaries, and consider allowing a designated bar where people could smoke. He compared it to a cigar shop.

Councilman Anthony Martinez, noting the city only allows for four dispensaries, said loosening the zoning rules would give the businesses a better shot to be successful.

“Why handcuff them further?” he asked.

This story was originally published July 6, 2017 at 4:10 PM with the headline "Thinking about opening a weed business in Merced? Here’s what leaders want to allow."