First RX pot app pitched

Jason Ferguson

The City of Custer has received its first application for a medical cannabis cultivation facility, which, if approved, would operate within the former Shopko building on Mt. Rushmore Road, which more recently has been home to Hills Self Storage and Black Hills Federal Credit Union (BHFCU).
The Custer City Council discussed the application at its March 21 meeting, as two representatives of Greenlight, the parent company of GLP Custer, LLC, the name of the applicant, came before the council to discuss the application.
Mike Green, Greenlight partners operation manager for South Dakota, answered questions, as well as the attorney for the company, Roger Tellinghuisen of DeMersseman Jensen Tellinghuisen & Huffman in Rapid City.
The application was tabled at the end of the discussion, as the council sought more information as to the wastewater the facility would expel, and more importantly, the water usage the facility would require.
In the application for the facility it states the company will implement a 14,000 gallon per-day reverse osmosis system to purify city water. For comparison, a residential home uses 3,000 to 5,000 gallons of water per month, depending on how many people live in the home.
City planning administrator Tim Hartmann said the city is working with Greenlight as well as engineers overseeing the upgrades to the wastewater plant to make sure the facility would have no adverse affects on wastewater treatment, while saying “to the city’s knowledge” the facility will not strain the city’s water system. He added, however, if the area were to suffer a severe drought that could change.
The facility would contain 8,370 plants, and would employ 20 to 25 people, with a starting wage of around $15 per hour on the low end and up depending on the person’s job. The building would have 49 cameras inside for security, as well as an on-site security guard. Green said the cameras in the facility tie into a Greenlight system that monitors every camera within a Greenlight facility across the country 24 hours a day.
­Rod Woodruff, owner of the Buffalo Chip Campground in Sturgis, has 51 percent ownership in GLP Custer, LLC, while a pair of brothers, Jim and John Muller, the former of which is chief operating officer of GLP Custer, LLC, owns the remaining 49 percent. The Mueller brothers have extensive experience in the cannabis industry, having started businesses in California and Nevada before selling them and then starting Greenlight in Kansas City, Mo. Green said Greenlight has 29 dispensaries in four states but is now expanding to South Dakota. Greenlight was drawn for three of the 15 dispensaries to be allowed in Rapid City, plans to open a pair in Deadwood and eventually would like to open one in Custer. However, any dispensary in Custer would require a separate application process.
“This isn’t a retail facility we are proposing,” Tellinghuisen said. “There won’t be people coming in and out. It’s self-contained, closed. But for the sign out front you won’t even know what it’s used for.”
Green said a sophisticated air exchange system is used to scrub the air of the smell of marijuana, so much so those at BHFCU wouldn’t smell the plants.
“The state regulations on all of this are very, very stringent,” he said.
Alderwoman Jeannie Fischer questioned how the city can have assurance the company will care about Custer, which Tellinghuisen called a good question before saying the employees will likely be people who live in Custer or at the very least, live nearby. He said the facility is in an area zoned for industrial and is an adequate distance from the schools, as required by law.
Green said the Custer facility is the only cultivation facility application Greenlight has submitted West River (there is one in Vermillion) and the plan is for the Custer facility to supply product to all of its dispensaries in the Black Hills. By law dispensaries in South Dakota must obtain their product in South Dakota. Because of that, Green said, operations would begin at the building almost immediately after the application was approved.
Frank Bettman, chief risk officer for BHFCU, said he just recently heard about the plans for the building and that BHFCU has concerns about sharing a facility with the proposed business, saying more study needs to be done but BHFCU might move if it doesn’t believe it’s a suitable location for its Custer branch any longer.
“If you see us there in a year, we’re happy,” he said. “If we are gone in two months, we’re not happy.”
Tellinghuisen said GLP Custer has told BHFCU it can stay as long as it likes.
“It will be entirely up to them,” he said.
Pechota asked if BHFCU would leave town if it had to move from the current facility, with Bettman saying that’s a question he couldn’t answer.
“We have been looking at other locations. We have budget constraints. There is a lot of things to consider in that,” he said.
While he couldn’t promise BHFCU would remain in the Custer market if it decided to move, he said, it would certainly try to remain in Custer.
“We’ve been here a long time,” he said.
“We want you to stay,” Fischer said.
If GLP Custer receives the OK from the city, the license would be good for one year and is subject to annual review.
City attorney Terri Williams said GLP Custer is in compliance with all state and zoning regulations, and meet all the criteria to be granted a license.
County resident Lori Thorson said she and other residents had questions surrounding the facility, including its potential affect on the crime rate in town and its proximity to the entrance of Custer State Park, which could be a negative in terms of tourism. She said it’s this kind of activity people in Colorado and other states are fleeing.
“It is one stop from recreational (use of marijuana),” she said. “That’s what they are hoping for.”

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