Tempe Board of Adjustment Denies Variance Appeal for Medical Marijuana Dispensary (January 24, 2019)

The Tempe Board of Adjustment met on January 24, 2019, to consider a single agenda item: an appeal of the hearing officer's July 17, 2018 decision to deny a variance to reduce separation requirements for a proposed medical marijuana dispensary at 8611 South Priest Drive. The appellant, represented by Court Rich of Rose Law Group, argued that the property had prior approval under 2015 rules and that the city's refusal to honor the transfer of that approval created special circumstances warranting a variance. After hearing public testimony and deliberation, the board voted 6-1 to deny the appeal.

Public Comments & Testimony

• William Bishop, an owner of an office condo in the same complex, opposed the dispensary, stating that the prior approval belonged to Natural Herbal Remedies, not the current applicant, and that the child care center distinction is irrelevant. He urged the board to uphold the hearing officer's decision.
• Jeffrey Gross, representing the property owner immediately west across Priest Drive (Emerald Center), argued that the appellant failed to meet the four-part variance test, noting that the 2015 approval had expired due to unmet conditions and was non-transferable. He stated the hardship was self-imposed.
• David Schweiker, representing Dr. Rema Peters (a property owner in the complex), also opposed the variance, asserting the application was not transferable and that the appellant did not meet the required tests.

Discussion Items

• The appellant, Court Rich, and David Dow (representing the landlord Image Productions) presented the case, arguing that under Tempe Code Section 6-903, use permits and approvals are transferable to successors in interest. They contended that the city's 2015 approval letter for Natural Herbal Remedies created a right that transferred to the current owner, Image Productions, via chain of title and an assignment. They claimed the city's imposition of a non-transferability condition was ultra vires and that the variance was needed because the city ignored the code. They also cited a court case where Tempe argued only two other possible dispensary sites exist, suggesting the city created the need for the variance.
• City staff (Karen Stovall) explained that the 2015 approval letter contained a condition that the use was authorized for Natural Herbal Remedies only and was not transferable. She noted that such non-transferability conditions are standard for medical marijuana facility approvals. Staff also stated that the appellant had not appealed that condition at the time.
• Board members questioned both sides. Concerns were raised about whether the non-transferability condition was legal and whether it was applied only to medical marijuana facilities. Staff confirmed that the condition is standard for medical marijuana applications but not for other types of approvals.
• Board member Collins expressed concern that the non-transferability condition might be applied unfairly, as it seemed specific to medical marijuana. Other board members, including Chairman Lyon, opined that the appellant did not meet the four criteria for a variance, particularly that the situation was self-imposed and that granting the variance would create a special privilege.

Key Outcomes

• The board voted 6-1 to deny the appeal, with board member Collins dissenting. The motion to deny was made by board member Noggle and seconded by board member Watson.
• The effect of the decision is to uphold the hearing officer's denial of the variance, meaning the proposed medical marijuana dispensary cannot reduce the required separation distances from a residential use (1,320 feet to 890 feet) and a child care facility (1,500 feet to 1,430 feet).
• The board acknowledged receipt of additional documents submitted by the appellant during the meeting but did not formally accept them into evidence due to lack of prior review.