An audit will be conducted of how the city of Springfield, Massachusetts goes about awarding local approvals for marijuana businesses.
The city’s Office of Internal Audit will perform the review at the request of City Councilor Justin Hurst, chair of the Audit Committee, who said he asked for it because of an allegation that a proposed cannabis cultivation business violates the zoning law.
"So that, in my opinion, if true, would have been extremely problematic," Hurst said.
Hurst said he and other Councilors all received letters from an attorney representing a competing marijuana cultivation business that claims another applicant, currently in negotiations with the city administration, does not meet the required 250-foot buffer from residences.
"We don't have enough evidence to determine whether it is true nor do I think that is our obligation, but that is one of the reasons why I thought we ought to look into it deeper," Hurst said.
In May, Mayor Domenic Sarno announced he had selected nine companies to negotiate host community agreements – a requirement before the companies can approach the state Cannabis Control Commission for a license. Six of the companies are seeking to open retail stores; there is the one proposed cultivation operation by Page Cultivate LLC, and two delivery businesses.
When the city solicited proposals for marijuana businesses earlier this year, 17 companies applied. An 11-member committee appointed by Sarno reviewed the applications and scored each based on several criteria.
Hurst said the audit will focus on the process the administration uses to decide which applicants to negotiate with.
"So we certainly want to identify if there is any wrongdoing, while at the same time insulate ourselves against liability and then we want to figure out how we get better for future rounds," Hurst said.
Addressing a meeting of the City Council Audit Committee Tuesday night, Julie Steiner, an attorney who specializes in cannabis law, who serves as a consultant to Sarno, said she welcomes the audit.
"Due process, fairness is what I am about," Steiner said. "I would never be involved, never ever would I be involved or put my reputation in anyway aligned with folks who were not acting in the best interest of the public."
City Solicitor Ed Pikula suggested the internal audit is premature since the negotiations for host community agreements have yet to conclude.
"This is quite unusual," Pikula said. "I've never seen an audit conducted while we are still in the middle of the process here."
City Auditor Yong Ju No estimated the audit would be completed this September.
Two years ago, Sarno signed host community agreements with four retail marijuana business. Only two have opened so far.
The City Council, two years ago, rejected a special permit for the INSA retail cannabis store. A judge ordered the special permit to be issued and the store is now open.
