Two companies have proposed medical marijuana grow facilities for a foreclosed industrial site in Benton Harbor, and the Berrien County Land Bank Authority will wait for 60 days for the companies to get the green light from the city before giving their final approval.
The medical marijuana proposals, from The Harvest Group and Vandelay Industries, were among the three bids reviewed Thursday by the Land Bank Authority for the former aluminum smelting plant at 900 Alreco Road.
The Land Bank did not receive any bids for the former Mercy hospital lot, on Agard Avenue in Benton Harbor, but will continue to try to market the 7-acre site.
Michigan legislators in 2016 voted to allow medical marijuana facilities, and they gave local governments the choice to “opt in” to the proposal.
Benton Harbor voted in December in favor of allowing medical marijuana facilitie, but its Planning Commission has not yet amended the zoning that would permit such uses. Its next meeting is 1 p.m. Tuesday.
The Land Bank requested proposals for the Alreco and Mercy sites after they failed to sell at the annual land auction.
The Harvest Group of Okemos offered $450,000 for the 11-acre Alreco site, and Vandelay Industries of Benton Harbor bid $5,000, or $20,000 if the outfit can obtain a “class C” marijuana-growing license. The license allows the cultivation of up to 1,500 plants.
Another firm, Riverside Partners of Holland, Mich., bid $72,007 and proposed to develop and resell the property as a manufacturing site or transportation hub.
Dan Fette, Berrien County economic development director, said that waiting for the property to be resold wasn’t the best use for the location, and recommended that this bid be rejected.
The medical marijuana companies have not yet been able to obtain the required letters of support from Benton Harbor because of the delay on the zoning amendment.
Options for the Land Bank Authority presented by Fette included rejecting the bids as incomplete, or providing the 60-day window to obtain the letters of support if and when Benton Harbor revises its zoning.
Fette suggested that extending the period for approval “is a fair option.” That timeline would allow for two regularly scheduled Planning Commission meetings and four City Commission meetings.
Berrien County Treasurer Bret Witkowski emphasized that the Land Bank Authority would not approve any bid without the approval of Benton Harbor officials.
Permission also would need to be obtained from the Michigan Department of Licensing and Regulatory Affairs for the grow sites.
In its bid package, the Harvest Group said it operates medical marijuana in other states and is now entering the Michigan market.
It is proposing a $5 million investment in start-up costs for cultivation facilities, grow rooms and processing facilities, starting with 35 employees and expanding to 78 workers when the site is fully operational.
It lists among its investors Joique Bell, a Benton Harbor native and former NFL football player.
Bell spoke to the Benton Harbor City Commission last year in favor of allowing medical marijuana facilities because of the illnesses suffered by his sister and the adverse effects that traditional medications have had on her.
The Harvest Group projects to produce 1,530 pounds of marijuana flower in its first year, expanding to almost 6,000 pounds when the site is completely developed. By year five, the operation could have a gross revenue of $20 million, according to its estimates.
Its plans include installing solar panels on the 100,000 square-foot ceiling of the building.
The company provided a letter of support from Benton Harbor Commissioner Mary Alice Adams.
Vandelay Industries was established last year by Benton Township attorney John Campbell. Vandelay plans to lease the site to Zaad Inc., owned by Raj Zinzuvadis of Niles, who owns a chain of vape shops in Michigan, Indiana and Ohio.
The company plans to tear down a brick building to the south of Alreco Road, and rehabilitate a 30,000 square-foot building on the north side, where it would locate 10 rooms for the growing, curing and processing of medical marijuana.
Vandelay estimates a $1.7 million investment and employing 35 people. It anticipates gross revenue of $8.6 million.
Its bid documents suggested that the Alreco property is the right location for a medical marijuana grow site because it is “out of sight and out of mind” on the edge of the city limits. The investors speculated that environmental restrictions on the property could discourage other types of development.
Land Bank Authority member and County Commissioner Mamie Yarbrough pointed out that it has been recommended that such grow sites be located on property zoned for heavy or light industrial use. The Alreco site is zoned for heavy industrial use.
Commissioner David Vollrath said he would have no objections to approving a medical marijuana facility if it had the blessing of Benton Harbor officials.
Fette explained that while county treasurers are required to sell foreclosed properties to anyone, regardless of the proposed use, a Land Bank can seek a buyer based on the financial viability of a proposal, the purchase price, potential employment and the taxable value.
