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HomeMy WebLinkAbout2022_4_25_City Response to 2021 Transfer RequeaIL,;, Community Development 919 Palm Streel, San LOS Obispo, CA 93,101-3218 805.781,7170 i,zatl, `n9 April 25, 2022 Megan Souza and Eric Powers Megan's Organic Market 280 Higuera St. San Luis Obispo, CA 93401 Via First Class U.S. Mail and Email to: Megan Souza: megan@megansorganicmarket.com Dustin Tardiff: dustin@tardiffsaldo.com Mark Cardona: mark(rbmepiisorganicmarket.com Subject: Determination of Transfer of Ownership Request: Megan's Organic Market: CANN-0064-2019 (280 Higuera St.) Dear Mr. Tardiff: This correspondence will serve as the City's response to your client's July 14, 2021, request to transfer ownership of MOM's SLO, LLC (MOMs) from the four current permitted owners/operators 1) Levi Seligman, 2) Melissa Seligman, 3) Keith Sweeney, and 4) Lindsey Law to the proposed owners/operators MOM USA, LLC: 1) Tarrah Graves, 2) Phoebe Lipari, 3) Allison Borges, and 4) Jillian Cardona, and 5) ODLAS Investments, LLC: 6) Tyler Saldo, and 7) Marian Francis Saldo. In the course of evaluating MOMs request Helios Dayspring pleaded guilty to criminal misconduct related to the operation of a cannabis business, prompting the City to make inquiries of all currently permitted operators regarding the completeness and veracity of the ownership and financial interest information provided to the City to date, as well as any past or continuing relationships between currently permitted operators and Mr. Dayspring and/or NHC SLO on August 23, 2021, and January 28, 2022. MOMs provided two separate responses and supporting documentation on August 31, 2021, and February 4, 2022, in response to MOMs past relationships with Mr. Dayspring and/or NHC SLO. Likewise, on April 20, 2022, at 4:00pm MOMs met with the City to provide additional clarification regarding past relationships with Mr. Dayspring and/or NHC SLO and to verify that there is no current or anticipated financial, managerial or operational relationship. Present at that meeting were: for MOMS, Attorney Dustin Tardiff, and business representatives Megan Souza, Levi Seligmann, Nicholas Andre, Quinn Brady, Mark Cardona, Tarrah Graves; and, for the City, City Attorney Christine Dietrick, Cannabis Manager Georgina Bailey, and Senior Planner Brian Leveille (via Teams). f Community Development 910 Palm S1rPet, San Luis Obispo, CA 93,101-;218 805.781,71170 nasty Dina In response to inquiries regarding the completeness and veracity of the ownership and financial interest information provided to the City to date, as well as any past or continuing relationships between currently permitted operators and Mr. Dayspring and/or NHC SLO, MOMs has represented to the City that: 1. At all times MOMS has disclosed all financial interests in the business required to be disclosed to the City. 2. MOMs has at no time from the date of application with City to present, had any vested financial operational or ownership agreement of any kind, whether written or verbal, or any other relationship or arrangement of any kind, whether written or verbal, or any other relationship or arrangement of any kind, that in any way resulted in Dayspring or affiliated entities or individuals owning, directing or controlling the operations, ownership, control or financial interests in MOMs in any manner that was required to be disclosed to the City. 3. No gifts or loan of funds of any kind have been received by MOMs or its members that would in any way affected the operations, ownership, control or financial interests in MOMs in a manner required to be disclosed to the City as part of the permitting or background process. 4. MOMs did not enter into any Non -Compete Agreements that would affect the operations, ownership, control, or financial interests in or to MOMS that were required to be disclosed to the City. 5. Neither Dayspring nor NHC, nor any person or entity affiliated with either Dayspring or NHC, ever performed the services outlined in the Management Services Consulting Agreement (Agreement) between SLO Retail Management, LLC and the Agreement was never implemented or performed, and was terminated without any actions occurring that required the notification to or approval of the City. 6. Moms has no outstanding debt or any other financial or business management/operational relationship to Dayspring or NHC or any person or entity affiliated with either Dayspring or NHC. 7. NHC and any of its affiliated individuals or entities have never had any role, passive or active, in the management or operations of MOMs. Excluding Nicholas Andre who is now employed by MOMs, but has no current role, passive or active, in the management or operations of MOMs required to be disclosed to the City. 8. All interests held by MOMs or its affiliated individuals in the NHC Broad Street properties have been transferred to Helios Dayspring/NHC or related parties/entities and there are no continuing interests in, or relationships related to the property. 9. All documentation, responses, and representations made to the City to date are true, correct, and no information was omitted to the City regarding the completeness and veracity of the ownership and financial interest information provided to the City to date, as well as any past or continuing relationships between currently permitted operators, requested operators, and Mr. Dayspring and/or NHC SLO. Community Development l 919 Palm Sheet, Sa Luis Obispo, CA 93d01 3218 The City has independently reviewed your request, and follow up documentation, responses and representations provided to evaluate MOMs initial and ongoing compliance with the City's Municipal Code, operator permit and state law, as well as to determine the process for and merits of the transfer request. The City's conclusions are set forth below: Assuming the accuracy of the responses, documentation, and representations made by MOMs, the City has not identified any violations of the City's Municipal Code, or operator permit. Likewise, the City has reviewed all information submitted as a part MOMs transfer of ownership request and has determined the transfer meets the requirements of 9.10.120, the Transfer of Ownership Administrative Regulations, and the transfer will not adversely affect the MOMs Community Benefit Agreement. Therefore, the transfer of ownership is approved, contingent upon the following conditions of approval: 1. The issuance of a new or amended Commercial Cannabis Operator Permit to include the proposed owners specified within MOMs transfer request will be contingent upon successful completion of the City's background check for all proposed owners of MOM USA, LLC: Tarrah Graves, Phoebe Lipari, Allison Borges, and Jillian Cardona, and ODLAS Investments, LLC: Tyler Saldo, and Marian Francis Saldo. 2. Upon successful completion of the background check for all proposed owners MOMs must notify the City in writing within ten calendar days of the action becoming final with the names and contact information of the new persons involved, together with a request that the city issue either a new or amended commercial cannabis operator permit, as applicable. Nothing herein constitutes an authorization of any actions not reflected herein that may be determined to violate applicable laws, nor does it constitute a waiver of the City's rights to act in accordance with its otherwise applicable ordinances and regulations regarding the transfer request, the operator permit, or other City permits or approvals should there be subsequently discovered information establishing that the information provided by MOMs SLO is incomplete, false, or misleading or that MOMs has engaged in activities that are otherwise in violation of applicable laws or regulations. To start the background check please have all proposed owners complete the electronic background packet for Owner/Principals at: https://hdlcompanies.ft)rmstack.com/forms/bc sanluisobis Quit Community Development 919 Palm Street. San Luis Obispo, CA 93401-3218 uu5. 781 7170 Please let me know if you have any questions regarding the conclusions of this letter or Transfer of Ownership process. Regards, V Michael Codron Director of Community Development