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Morgan Hill
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May 11, 2021

Cannabis narrowly loses, again, in Morgan Hill

Council majority rejects commercial marijuana in city limits

The Morgan Hill City Council has once again decided they will not allow commercial cannabis business in the city limits. And once again, council members were narrowly split on the issue at a recent meeting. 

The same two council members who have supported legal cannabis activity in Morgan Hill in the past—Mayor Rich Constantine and Rene Spring—found themselves again on the losing side of a vote April 21 to consider a locally controlled commercial permitting and approval program. Council members Gino Borgioli, Yvonne Martinez Beltran and John McKay voted against the motion by Spring to revisit the possibility of commercial cannabis in Morgan Hill.

Thus the city’s prohibition of marijuana-related commerce will continue in Morgan Hill for the foreseeable future.

Council members who voted against cannabis in Morgan Hill said they agreed there are potential benefits of commercial cannabis and the revenue it could bring to the city’s general fund. But they haven’t found enough definitive information to support those promises.

“I could support it given the right information. I need more good, reliable, unbiased information,” McKay said. “I don’t think I can get this at this time without burdening our staff” with an order to conduct more research.

The last time the council discussed cannabis was in November 2019, when the body voted 3-2 to reject a proposed ordinance that would allow licensed, regulated and taxed cannabis business in the city limits. Constantine and Spring voted in favor of that ordinance, which had been proposed by the city’s planning commission.

Spring at a meeting earlier this year asked the council to bring commercial cannabis back to the agenda to discuss whether the issue should be considered further. At the April 21 meeting, Spring said “a lot has changed” since November 2019, including the fact there is a new council member in Borgioli, who was elected in 2020.

Spring said he has heard from many friends, acquaintances and other residents who support commercial cannabis and have asked him to bring it back to the dais. He noted that in November 2016 a majority of Morgan Hill voters—58 percent—voted in favor of California Proposition 64, the state law that legalized the adult use of commercial and recreational cannabis.

“The world is changing and we’re acting as though we’re in (alcohol) prohibition times in the 1930s,” Spring said. “I think you’re going against the majority of voters in this community and they will not be happy with some of you.”

Constantine also cited the public support and the state legality of cannabis as his reasoning to vote in favor of bringing it back for further consideration.

Prop 64 allows cities and counties to establish permitting and other ordinances for local cannabis industries—including retail, cultivation, distribution and testing operations. In a report commissioned by the city in 2019, consultant HdL found that legal cannabis business could bring in between $340,000 and $750,000 annually in new tax revenues to Morgan Hill.

But council members and some residents who addressed them April 21 noted that the jury is still out on whether such a windfall would occur, as some communities where cannabis has been commercialized have not seen revenues they expected.

Most of the dozen or so members of the public who addressed the council on the April 21 cannabis item asked the body to again reject commercial marijuana in Morgan Hill. Many cited the possible increased access among the youth to cannabis as a drawback, even though the state law restricts the purchase and use of marijuana to those age 21 and older.

Matthew Wendt said products like edible “gummies” and vaping devices may increasingly and illegally make their way into the hands of children if cannabis businesses open up.

“Marijuana (dispensaries) in our town would be damaging to our youth,” Wendt said.

The planning commission’s proposal in 2019 would have allowed manufacturing, distribution, testing and up to four retail cannabis businesses in Morgan Hill. Such businesses would have required conditional zoning permits approved individually by city planners, and would have to be located at least 600 feet away from schools and other facilities that serve children.

In November 2018, 79 percent of Morgan Hill voters approved local Measure I, in support of the taxation of cannabis business should the council ever allow it here.

Cannabis businesses outside Morgan Hill may deliver to customers in the city limits, and the city can collect taxes on such transactions. On April 21, City Manager Christina Turner said the city has begun that process.

“The compliance level is low but it is something we’re working on,” Turner said.

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