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Sigh of ReLeaf

One of the first San Francisco cannabis dispensaries that opened in the old medical marijuana era were also among the first to close in the new recreational marijuana era.

ReLeaf Herbal Cooperative, which has been doing business on Ninth Street and Mission Street since medical pharmacies became legal in 2005, sold its last bag and closed on December 15.

ReLeaf didn’t stop because they lost too much money, nor because of an FBI raid like we saw in the early days of legal pharmacies. ReLeaf is closed because their landlord has evicted them. And thanks to the archaic 2005-era laws under which they got their license, ReLeaf was “locked in” at their original 1284 Mission Street location and legally not allowed to do business anywhere else in San Francisco.

“Our landlord had to refinance an existing loan and the bank was not allowed to support a cannabis tenant on the site of the property,” ReLeaf said on their website last November, which has since gone up in smoke. “No fault of our own and after receiving a formal eviction notice and fighting our best legal battle for possible solutions, we must come to the harsh reality that we must cease operations at 1284 Mission St. effective December 15, 2019.”

But ReLeaf will rise again in a new location, probably in the Ingleside neighborhood. The San Francisco Board of Supervisors passed a measure last Tuesday that would allow licensed medical cannabis dispensaries to change their licensing address, a right that the newer dispensaries have had for years.

Under the old-fashioned, early rules that granted ReLeaf its license in 2005, the Department of Health regulated the marijuana trade rather than the modern-day San Francisco Office of Cannabis. The health department won’t help if your landlord evicts you because your weed carries banking risks, even though cannabis banking is quickly normalizing.

“There’s one thing that’s still stagnant in this industry: federal law,” ReLeaf owner Heidi Hanley told the Board of Supervisors Land Use and Transportation Committee a month after the pharmacy closed. “We are still being evicted and our business is being shut down by federal banking laws.”

ReLeaf was an old-fashioned medical pharmacy that never tried to turn into a fancy Apple Store imitation. Their consumption lounge was little more than a card table and two folding chairs. But ReLeaf’s no-nonsense storefront and dirt-cheap prices made it a popular legacy pharmacy.

Therefore, a public outcry led Supervisor Matt Haney to draft the new location permitting legislation to correct this flaw in the old rules. “It’s a serious problem that can cause a business to shut down if it’s one of the older operators,” Haney tells SF Evergreen.

Haney calls his bill an “emergency measure” because the new recreational use license, stock programs all include portability, or the ability to be transferred to another address. “As we move forward with new equity companies, there will be portability, so this won’t be an issue,” Haney says.

This is not a sweeping legislation, the bill only concerns a very small number of pharmacies that were allowed under old rules from more than ten years ago. But the details of ReLeaf’s upcoming move raise suspicions that this legislation ultimately benefits predatory landlords more than pharmacies.

The chairman of the board of trustees, Norman Yee, voted against the bill for that reason. “The transferability of this specific permit currently only applies to two San Francisco locations, 1940 Ocean Avenue and 1545 Ocean Avenue,” Yee said at Tuesday’s meeting, referring to ReLeaf’s application to relocate. “One of these locations has been evacuated before [a dispensary.]”

That location is the former home of the now-defunct 1944 Ocean Cooperative, who claim they were illegally evicted. Hoodline reported in August that the pharmacy had sued the landlord for unlawful eviction. That case concluded closing arguments on Feb. 19, although the decision of the San Francisco Superior Court judge has not yet been made public.

But sup. Yee said landlord Lamax Nguyen is “now turning around and selling the property knowing that this legislation will benefit them.” (Indeed, that real estate is listed as a $4 million demand.) “We don’t want land use speculators and commercial property owners to prevail, asking for top dollars and crowding out tenants so they can make more profit.”

In response, Haney added an amendment to the bill that prohibits dispensaries from moving to a location where the new landlord had falsely evicted a previous pharmacy tenant.

It’s still not certain whether ReLeaf will eventually reopen at either of the two Ocean Avenue locations they plan to move to. But the very fact that they are allowed to request a move, a right they never had, although newer dispensaries do, is certainly a relief.

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