‘Do we really want to be a city?’ Parts I and II

Dunes City’s marijuana debate raises questions of the city’s issues, future

Part One

As Dunes City Councilors sat in a special work session on Oct. 17 to discuss the future of current marijuana grow operations in the city, newly appointed Mayor Robert Forsythe posed a question to the council.

“Do we really want to be a city?” he asked. “Are we acting like a city? Are we providing services? We don’t have a police force and we don’t have a library. We can write citations but nobody pays them because you have no way to make people pay them. We don’t have any agreements with any of the court systems. I think the question is, do we want to act like a city, or do we want to become a county again or ‘Florence south’?”

The months-long process that led to this point, coupled with the divisive debate that accompanied it, laid bare many of the issues currently facing Dunes City.

Through a complex combination of vague laws, coupled with an inability to reasonably enforce them, slim city coffers and miscommunication between city officials, the recent marijuana debate made the city’s problems starkly clear.

The work session’s focus on marijuana stemmed from the council’s Sept. 13 decision regarding the future of the marijuana agricultural industries in the city.

At issue were three different parties that had applied to have grow sites within city limits. While the process to become a certified marijuana grow in the state of Oregon is lengthy, one part of the process requires applicants to submit a Land Use Compatibility Statement (LUCS).

The purpose of the LUCS, which is required by the Oregon Liquor License Commission (OLCC), is to determine whether a land use proposal is consistent with a local government’s comprehensive plan and land use regulations. City representatives must review their ordinances to make sure marijuana operations conform.

Dunes City has had two completed LUCS’ for quite some time, with one approved for grower Valerie Cain-Mathis back in February, though public outcry about the issue didn’t start until August.

The public, who was for the most part unaware of the LUCS, called for the grows to be shut down and further grows be permanently banned in the city.

In a Dunes City Council public meeting held Sept. 13, councilors passed Ordinance 245, which allowed the existing grow operations to remain in the city, but banned further operations from being approved until the November 2018 elections, where the public could have the opportunity to vote the ban into law.

The main reason the council decided to keep the existing grows was because two separate law firms — one from Lane Council of Governments, the other Speer Hoyt LCC — had agreed that city codes did not prohibit the grows. The LUCS were legally sound, in the attorney’s opinions.

While there have been three grows discussed, currently OLCC has received just two LUCS, and one of those was from Cain-Mathis, according to Acting City Administrator Jamie Mills.

At this time, it is unclear if the third grow will be grandfathered in and allowed to stay, or would fall under the city’s ban as a new applicant.

Some members of the public were not fully satisfied with Ordinance 245, and turned their focus on the existing grows. Their primary argument was that the LUCS were filed in error and that city officials did not properly prepare them or interpret local laws correctly.

At the Oct. 11 city council meeting, citizens asked the council to review the LUCS, which the council agreed to do, leading to the Oct. 17 work session questioning the future of the city.

“As I’ve been saying all along, we spend a lot of money on attorneys who say we have to allow these three commercial grow operations,” said Councilor Robert Orr. “However, we’re also being told by our community that the attorneys are wrong. … They’re preaching to the choir when they’re yelling at us. We’ve done all we can do because we did what our attorneys told us to do. We can’t do any different than that.

“But if the community has another way, man I’m all for it. I’m not saying there were any errors made. I think certain community members seem to imply there were, but whether they were or not, I think there’s another way to looking at this — and if there’s a way to right our wrong, then we need to right that.”

But Councilor Duke Wells didn’t think that there was a way around it.

“Remembering what we discussed with our attorney, and as much as I don’t want these things in Dunes City, as far as I can see the ship has sailed on this,” Wells said. “I don’t see where I can go back in and redo these, … but I don’t see anything we can do.”

Forsythe agreed, and the council decided to contact the city’s attorney for further input, which they received the next day in a special executive session that was closed to the public.

After the executive session, the council made a decision not to withdraw the LUCS. The marijuana grows could continue.

The Siuslaw News requested the attorney reports that cleared the LUCS for approval, but were turned down due to confidentiality. However, there are clues to the attorney’s reasoning, and many of those reasons cut to the heart of the city’s problems, the first of which are poorly written city ordinances.

Before the council took its final vote to allow the grows to stay, Day Law and Associates, attorneys representing the operations, submitted a letter to the city for public record. The letter laid multiple reasons why the council should not withdraw the LUCS, including a legal explanation for the grows.

The letter pointed out that Dunes City Development Code 155f.1.3 defines agriculture as “The tilling of the soil, raising crops, horticulture, small livestock farming, dairying and/or animal husbandry, and the raising of Christmas trees.”

The attorney’s letter went on to state, “Raising marijuana - a crop - is ‘agriculture’ under the city’s code and is therefore outright permitted use on my client’s properly. And determination by the city to the contrary would ignore the plain language of the city’s development code.”

According to the Oregon Department of Agriculture, cannabis is considered an agricultural crop. Dunes City Code does not specifically negate this.

Opponents to the grow sites have pointed to the Dunes City Comprehensive plan which states, “Dunes City is primarily a rural residential and recreational community. Agricultural activity is secondary in nature and is usually restricted to small animals, horses and family gardens.”

While the plan does put emphasis on “family gardens,” it gives ample leeway to interpretation with phrases like “secondary in nature,” “primarily” and “such as.”

“What is ‘such as?’” asked Mills when asked about the rule. “It’s very vague, which is part of the problem with the comprehensive plan. It needs to be updated so it can have clear and objective opinions in it.”

The question then leads to if the commercial aspect. The grows are located in a residentially zoned area, so why would a commercial grow site be allowed?

Policy G4 of the Comprehensive Plan states, “Minor economic activities, such as home occupations, will be permitted if they are not harmful to air, water or land quality, and if they are not potential nuisances to neighboring uses. Dunes City does not seek industries to locate in the city.”

“Minor economic activities” does not give any direction to the scope of the occupation, whether it be large or small.

“It seems to be ‘commercial’ is the word that everybody is hung up on,” Mills said. “And I can understand why they’re hung up on it. Commercial shouldn’t be allowed in residential. If that’s the case, then we need to change our code because our code encourages home occupations.”

Mills believed the vague laws were a primary force in allowing the LUCS, a sentiment the council agreed with.

“We haven’t looked at our codes for some time,” Forsythe said. “This is kind of a kick in the pants and we need to start updating this stuff anyway. I would have preferred it done in a different manner, but this does head us down that process.”

Another issue facing the city is the actual enforcement of these vague laws.

The LUCS requires current growers to comply with city nuisance laws, which are laid out in Ordinance 176.

The Siuslaw News did obtain one copy of a completed LUCS, which specifically goes over these concerns, stating the applicant must “be aware that Dunes City nuisance ordinances will be enforced.”

In an April 13 public Dunes City Council meeting, Cain-Mathis laid out her plans to avoid running afoul of the nuisance laws.

“We will have no odor issues because we filter grow sites with state of the art charcoal systems,” she said. “A charcoal system is placed on the exhaust.”

She also brought up her plans for safety concerns, including security cameras, an eight-foot fence and safes for cash on hand.

Ordinance 176 does give the public recourse if the marijuana growers do break any of the nuisance provisions.

The city will have the authority to review the site if a nuisance is reported to them. If the operations do not follow through on fixing the issues, legal action can be taken against them.

But what action can the city actually take?

Dunes City has no police force, instead relying on Lane County Sheriff’s Office, which can take up to four hours to arrive to a scene. The city also lacks its own court system, which has led to code violations being ignored by residents and problems continuing to exist.

“We need to link up with the court system, whether it be Florence or Lane County,” Forsythe said. “I think we need an IGA (intergovernmental agreement) with Florence Police Department.”

Nuisance would not be the only negative affects the grows could have on the city. The public has brought up multiple objections to possible environmental issues the grows could create. For example, the LUCS informs growers that “no phosphorus-containing fertilizers or pesticides are permitted.”

In the April public meeting, Cain-Mathis gave an explanation as to her process in following that rule.

“We buy only pre-mixed soils,” she said. “We do not use manure in our grow sites. We only use state approved fertilizers and we only grow organic products. We do not want anybody buying any marijuana from any distributor that isn’t organic.”

She then explained that the plants themselves will create no waste, as the entire plant is processed, stem to follower.

One frequent concern for Dunes City residents has been the grows’ use of water, with one fear surrounding a well built on one of the properties. A one-pound marijuana plant typically needs one gallon of water per day. The fear was that the well would be used to water the crops and dry up the rest of the area.

The Cain-Mathis LUCS stated, “Water well is being placed on property for cultivating purposes, which meets Chapter 155 Zoning and Development site plan included (sic).”

The well is required by OLCC because each grow must have its own water supply.

Cain-Mathis contends that she will not be using the well water for the crops, instead using water shipped in from Eugene and stored in underground containers.

The LUCS required Cain-Mathis to provide a signed contract for that water delivery.

Some members of the public have suggested the LUCS negates this by tying well water to cultivating. However, the LUCS does not specifically say how much the well would be used for the grow site.

Even if the grow site did use the well, a survey found that it would have little impact on the surrounding area.

In a written statement read aloud at a Sept. 13 public meeting, Michael J. Thoma, PhD, a hydrogeologist for the Oregon Water Resource Department, concluded, “It is unlikely that even heavy use of the well will significantly impact the lake. A 400-foot well will have the same impact as a 100-foot well.”

The 400 feet was in reference to the unusual depth of the well, caused by problems in its construction - the walls kept caving in. While most wells reach 100 feet, Cain-Mathis’ reached 400.

Seepage from the grow site was another major concern of the public, with fears that contaminants would seep into Woahink lake.

“We have no stagnant water issues,” Cain-Mathis said. “What little excess water the plants have is drained out to be caught in trays below. We allow the above lighting to evaporate the rest of the waters in the trays. We do not discharge any products from our site to any sort of drainage system ever.”

She also explained that the site has a concrete floor that would further prevent seepage.

Dunes City does have the ability to monitor if grow sites seep into the water supply. In every public city council meeting, a time is set aside to discuss the lake and reports from water testers.

Despite all of this, some Dunes City residents are continuing to push for the grow sites to be disbanded, even after the council decided Oct. 25 to allow the LUCS to continue.

Residents are writing resolutions for the city council to pass, attacking the grow sites over water use and detailing information local citizens have found out about the growers and the process that led to the LUCS.

Defining the ordinances, and enforcing them when they’re broken, is only a small part of why the LUCS still remains, and why Dunes City Council is asking if the city is broken.

Part Two

Beyond water usage, Dunes City residents continue to question the process of how the LUCS was processed, particularly in regard to Acting City Administrator Jamie Mills. During public comment sessions at several council meetings, Mills has been accused of circumventing Dunes City law in how she handled the LUCS. Some residents have even called for her termination.

This leads to another crisis Dunes City is facing now — a lack of communication with overburdened city officials.

The public has frequently stated that neither Mills, nor Dunes City Council, were open about the marijuana issue and that it was slipped in under the radar. However, notes from Planning Commission and City Council meeting minutes prove this assumption incorrect.

Back in March, a joint Dunes City Council/Planning Commission was held specifically on the issue of marijuana grows. In attendance were six city councilors and five members of the planning commission.

Planning Commission Chairman Angela Allen stated that the grow sites have been discussed intermittently in commission meetings for several months.

“Ultimately, the Planning Commission agreed that it would like to know how the city council feels about the issue and if the council had any recommendations for the planning commission,” minutes from the meeting quoted Allen.

Multiple questions were posed in a roundtable discussion, including whether marijuana is actually a crop, what kind of security issues would arise from the sites, water quality nuisance concerns and if such sites were even allowed in residential areas.

The commission decided to look into multiple ways to prevent the grows, including amending city code to prevent large agricultural grows, regardless of the crop, and creating a moratorium on grow sites pending further research and consideration.

Mills was tasked with looking into these issues, which she frequently did with the commission throughout the following months.   

On April 27, Mills explained to the planning commission that Dunes City cannot prohibit grow sites, but it could adopt “reasonable” regulations and/or require Conditional Use Permits.

Allen suggested that the commission could address possible code changes.

On June 22, the commission notes read, “Staff went on to report that research is ongoing into language regulating marijuana grow sites and suggested that research continue and discussion follow at a later date (sic).”

But actual changes to the code were never approved or discussed by Dunes City Council until the complete ban on future grows. The LUCS were also never discussed, except by marijuana grower Valerie Cain-Mathis in April, when she outlined her operation’s compliance with city laws.

The council did not vote on the actual LUCS; however, Mills did approve it. Citizens have stated Mills circumvented the council and planning commission by doing this, but city regulations give her full authority to do so.

Oregon State Law 475B.063 states that when a LUCS is submitted to a city for approval, the city has 21 days to approve the LUCS. Cain-Mathis’ was approved on Feb. 2, long before the city council and planning commission’s joint meeting on what city laws actually mean regarding grows.

Mills was forced by state law to make a decision within a 21-day time frame, which wouldn’t allow for a year’s long discussion on city codes.

“Since each of the three LUCS applications submitted to Dunes City are for indoor grow operations, and after consulting with the city’s attorney and another at Lane Council of Governments (who stated the grows must be approved), I felt I had no choice but to approve the LUCS,” Mills said.

Regarding the fact that Mills submitted the LUCS without Dunes City Council approval, she referred to her contract, which states she is to “work under the direction of the mayor performing other such duties as may arise.”

“Since the city administrator is the only official employee of Dunes City (other staff in the office are part time Cardinal employees who do not have sole decision-making authority of the city), I am tasked with duties of the planning secretary,” Mills stated. “The Planning secretary is tasked with making the final decision on LUCS.”

It was neither the city council’s nor the planning commission’s job to approve the LUCS. It was Mills’.

It’s these kinds of communication issues that the city is having problems with, councilors contend. Mills is the only employee allowed to make decisions, and there are no other full-time staff members to look into complex issues.

This also inhibits Dunes City Council’s ability to function.

Councilor Duke Wells has frequently blamed himself and the past city councilors for not fully understanding the complexities of marijuana law. In 2016, the council was focused on possible tax issues regarding marijuana. It never occurred to them that they had to think about grow facilities.

“I was on the city council when this issue came up and we missed it,” Wells said. “Somehow it got put aside. I honest to God don’t remember this ever coming up. ‘Do we want commercial grows in Dune City?’ I don’t remember that question being asked in a meeting. But, at the same time, obviously it was there to be found. We didn’t ask the right questions of staff. I think that’s how we got here.”

The city’s limited staff could not fully address the council on these issues, and a council confused on the full ramifications of marijuana legalization didn’t know what to ask city employees. In short, all parties are overwhelmed.

Recently, Dunes City Council has asked for the public to become more involved to help the city.

Wells talked about how he often speaks to citizens on his own about issues, then brings those concerns to council meetings, but finds empty seats in the audience.

“Most of the time there’s nobody sitting out there,” Wells said. “When it is big issues like the septic system or pot, we fill it up. Which is fine. Like our mayor said, I wish those folks would come here every meeting.”

At one time, the city did have more opportunities for public input through multiple committees and commissions, but in April many of these programs were abolished due to lack of public involvement. In one case, the Dunes City Road Commission had not had a quorum present for months.

“We’d have a lot smoother operation if we had that input all of the time,” Wells said.

An attorney for the grow site stated that there is nothing in state law that allows the city to rescind or revoke a LUCS. Any attempt by the city to do so would be unlawful.

The lawyer also made the case that his clients had a vested right to continue their grow operations, as the city had approved the LUCS months ago, the growers have invested large amounts of capital into the project and the city made a contract. If the city reneged, the lawyer said, the growers would have every right to ask for that money back from the city.

“The city council has a duty to protect the interests of all the citizens of Dunes City, not just those that yell the loudest,” the law firm said. “Exposing the city to substantial liability is hardly looking out for the well-being of the entirety of Dunes City. …  It is time for the mayor and the city council to stop pandering to a vocal minority bent on bullying my clients out of Dunes City. It is time for everyone involved to grow up and move on.”

Dunes City Mayor Bob Forsythe said he was sympathetic with the lawyer’s view.

“Even if there was an error in the process, but both sides were acting in good faith, it’s not going to matter,” he said. “It’s just like any other contract. Just because one little thing in the contract wasn’t right, it doesn’t mean the whole thing was thrown out. So, if you’re waiting on line seven, unless it’s egregious, there’s nothing to do about it.”

Councilor Sheldon Meyer asked, “If we go broke, and if we’re spending all of our money on legal fees, then what do we do? We don’t have money, we don’t have taxes.”

How the city is funded is a major factor that Forsythe brought up.

Dunes City has limited income sources. It receives money from Oregon Department of Transportation, which is restricted for the roads; a hotel tax, which is regulated to marketing and tourism; a tobacco tax; and fees from building permits. One of the city’s biggest income streams is franchise and business license fees.

But the city does not tax its residents.

“We’re talking about services that we don’t have and don’t provide,” Councilor Robert Orr said.  “I’m not saying that I would want to tax anyone, but how do you provide services without having revenue from a tax in the community? I know where we get some of our funds, but we don’t have a budget.”

A major lawsuit could push the city into bankruptcy. Enforcing codes without an infrastructure can cripple justice. The city cannot afford a more robust, full time staff that would help alleviate many of the compliance and communication issues the marijuana situation brought to light.

“The city wants rules and they want regulations and they want us to do these things but we have no teeth,” Councilor Tom Mallen said. “Really, the marijuana issue will continue. If we have some rules that we can enforce, maybe it could be helped. It’s a delicate balance right now. Here we are, trying to deal with things in making decisions, I kind of wonder what type of teeth do we have.”

If these basic functions of a city cannot be met, the council wondered, should Dunes City still be an actual city? 

When asked if some of the city’s problems led to the controversy of marijuana grow sites, and if these issues could lead to an answer about the city's future, Mallen said, “I think it plays into it quite heavily because Dunes City is obviously expressing an opinion that they don’t want marijuana here. So, it would seem, just from all this hullabaloo that we’ve been through, that Dunes City really wants to be a city.”

The citizens turned out to protect Dunes City from what they felt was a danger. Therefore, the citizens want a “city” — with systems in place including police, courts and community engagement.  Because of this, the council has begun to take steps toward becoming a city. Forsythe will be speaking with Mayor Joe Henry and City Manager Erin Reynolds, both of Florence, to find out how the larger city approached funding and city ordinances.

Dunes City Council will also look into IGAs with police services, such as the Florence Police Department, and pressuring Lane County to develop a plan for court systems.

In the meantime, the city council, planning commission and city staff will work on revising city ordinances, laws and the Dunes City Comprehensive Plan.  

But they can’t do this on their own, councilors contended. They need more help from the community, not just on controversial issues.

Regarding the entire marijuana debate, Forsythe looks at it as a growing experience.

“I think it’s a good thing,” he said. “When we look back on it in a couple of years, we’ll go, ‘You know what? We did what we could and we’ll make sure it’s handled correctly whichever way it goes.’ I trust all of these guys up here to do things because it’s the right thing to do, not because it’s the thing they want to happen. We’ll make it work for the community.”

As for the existing marijuana grow operations, Wells felt that, if the public approves the ban in November, the city won’t be faced with the issue forever.

“They’ll eventually go away,” he said. “We won’t have these in Dunes city, eventually. When that person is gone and no longer part of Dunes City, then that permit is gone also. And then it will be up to us to use this knowledge and prevent any other commercials from coming into town.”

Or, Wells said, the community could eventually decide to accept them.

“If November comes and people, say, ‘It’s okay, we don’t mind having commercial grows here,’ then we have to instruct staff to figure out where the heck we can allow them to be and not be caught again like we were this time,” he said.

Until that happens, Forsythe and Wells advised calm in the continued discussion surrounding marijuana.

“We have to be civil, whether we agree or disagree,” Forsythe said. “If not, things will take their course, but I don’t tolerate anything in my life that isn’t a civil interaction.”

Wells continued, “It would work against our cause if that started happening. It’s legal. Do I agree with it? No. But it’s legal and I would hate to have any vigilante stuff going on.

He pointed out that beyond a very vocal contingent of the public, the majority of Dunes City has not been involved with the marijuana issue.

“There’s the vast majority of people out there who don’t come to the meetings, either side, that just want to live in Dunes City,” he said.

After the Oct. 25 meeting where the councilors allowed the LUCS to remain, Meyer pointed at the Dunes City Logo hanging above the council chamber. It read “Dunes City, A Nice Place to Live.”

Meyer turned to the council and smiled, saying, “Even with the stuff going on, Dunes City is still a nice place to live.”