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Date: 11/3/2022
SPRINGFIELD – The City Council approved a special permit for Diem Cannabis to operate a dispensary location at 337 East Columbus Ave. during their Oct. 24 public hearings meeting. The item drew extensive debate as the council weighed whether to grant the permit despite Diem’s undefined host community agreement (HCA) status.
Background
Previously, Diem Cannabis appeared before the council on Feb. 1 for two special permit requests – one to operate a dispensary and another to operate a cultivation site. Both permits were tied to the former Macy’s store at the Eastfield Mall on 1685 Boston Rd. Diem Cannabis only received an HCA for its dispensary operation at the time of the meeting.
Attorney Brian Shea spoke on behalf of Diem Cannabis and articulated the organization’s intent with the Macy’s space.
“It’s a really great way to get in and obtain a lot of space that has incredible infrastructure … If its structured correctly and you protect minors from a facility like this, which can easily be done, I think it’s a great reuse for a property like this,” said Shea during the Feb. 1 meeting.
The proposed Diem Cannabis location also presented the potential for a trailblazing moment. Owner Luiselis Hernandez would be the first Latina woman to own and operate a dispensary in the state of Massachusetts.
City Council meeting
Shea returned to the council with a special permit request tied instead to 337 East Columbus Ave. Shea said Diem is looking to relocate their approved HCA for dispensary operations after failing to receive one for their proposed cultivation site.
“We had been married to that [Macy’s] space for a substantial period of time … We did not get selected for a cultivation facility, and staying at the Macy’s building simply became an operation that would not be feasible,” said Shea.
After withdrawing from the Macy’s site, Shea said the organization pivoted to the East Columbus Avenue location. The site has been vacant for several years, formerly in operation as a restaurant space and an adjacent office building, according to Shea. The former restaurant location would be utilized for the dispensary’s storefront, and the office space would be set aside for a future development.
“It’s a substantial parcel of land … We immediately started exploring the prospect of installing retail cannabis shop,” said Shea. The purchase costs roughly $1 million, while renovations are estimated at $3 million for the restaurant space.
Shea said the project received approval from the East Forest Park Civic Association and the South End Citizen Council under the condition that any proposals for the former office building would be brought to both organizations.
Co-founder of Diem Cannabis Chris Mitchem stressed that this will be Diem’s third and final dispensary location in Massachusetts. While developing the dispensary in Springfield, Mitchem received several offers from other cities.
“We’re holding out for Springfield. We all have our fingers crossed that this is it,” said Mitchem.
State legislators spoke in favor of the project. State Sen. Adam Gomez and state Rep. Carlos Gonzalez both expressed support for Diem’s proposal, citing the importance of furthering the cannabis industry’s diversity.
“There is not a principal Latino [dispensary] owner, in respective to the demographics of our great city, I think this is the opportunity,” said Gomez.
“I’m fully in support of it … I think its important we need to focus on equity. We need to make sure we provide access to opportunity for licensing in this new industry, the cannabis industry, to a diverse community for many years that was locked up for its use of cannabis,” said Gonzalez.
The change of location brings new obstacles for Diem. Shea informed the council that DPW Director Chris Cignoli told Diem that they would need to complete a new traffic study a week before the meeting. Shea estimated that a study would cost $5,000 at the bare minimum, which he considered a “hardship” to Diem’s ownership.
“We are all familiar with the traffic on East Columbus Avenue … That location operated commercially a long time before today,” said Shea.
Another challenge for Diem is a reworking of their HCA. Business entities that switch their HCAs location must renegotiate and receive approval from Mayor Domenic Sarno to reactivate their HCA. The now-operational dispensary 6 Brick’s endured a similar process while in its development.
When asked by City Councilor At-Large Justin Hurst about Diem’s HCA status, Shea said, “I don’t have an answer.”
“I had submitted my request over two months ago, I have inquired periodically if there is anything else that is needed … I didn’t anticipate it to take this long,” said Shea. The attorney said he is unaware if the traffic study request is tied to the approval of Diem’s new HCA.
Hurst expressed grievances with the delays that Diem is experiencing. He correlated the experience to the setbacks 6 Brick’s, another minority-owned dispensary, endured during its HCA process.
“It’s a bad trend … There’s no reason why this particular individual would have to go through any sort of additional hardship in an industry that is hard to get into already, and an industry that certainly minorities have been disproportionately impacted by in terms of incarcerations,” said Hurst.
Attorney Talia Gee, who oversaw the HCA process, clarified that a traffic study is a required step in the process. She also shared that an approved HCA is tied to its specific location.
“An [HCA] is an agreement that’s tied to people, place and things, so if a party wants to change the place of that operation, it will need to be amended,” said Gee.
Planning Director Philip Dromery confirmed that 6 Brick’s did submit another traffic study in their change of location. Dromery shared that Shea submitted a “traffic memo” that he shared with the DPW, but only recently heard that the traffic submission would need additional information.
Ward 6 City Councilor Victor Davila agreed that a traffic study is needed to ensure an equitable process for all applicants, but aired frustration with the delay.
“If we’re going to be equitable, we are going to do it across the board … I would hate to see people be held up like this again,” said Davila.
Dromey said he only received Diem’s tax certification roughly “a week and a half ago” and scheduled the hearing as early as possible.
“As soon as I got all of the application, I moved forward with the application … I can not process the special permit until I have that tax certification from the collector’s office,” said Dromey. When asked on his view on the project, Dromey said it meets commercial zoning requirements.
The council considered continuing the item to a future meeting before Mitchem explained Diem’s situation.
“This is incredibly harmful to continue, this project will fall through if it is continued tonight … the bank won’t allow us to continue stringing this out, nor will the investor that is supporting it,” said Mitchem.
Mitchem shared that his organization contracted the building in May 2022 and has been trying to get the HCA switched since then. He said his organization spent $100,000 on nonrefundable deposits so far to extend the process.
“That contract is up the first week of November. We are going to lose this building; we are going to lose this project. Everything is on the line tonight,” said Mitchem.
The council decided to reopen the hearing. Mitchem clarified that Diem’s investors are contingent upon the special permit request being approved rather than Diem receiving an immediate HCA approval.
“If we get the special permit, we can close on the building and continue negotiating and completing any action items required by the mayor’s office and the city of Springfield,” said Mitchem.
The City Council ultimately approved the special permit in a unanimous vote.