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In Oregon border town, a windfall could come from marijuana sales — to Idahoans

Ontario gets ready for marijuana sales

In November, Ontario repealed its ban on marijuana dispensaries. Is it going to be an economic boom? A surge in Treasure Valley visits?
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In November, Ontario repealed its ban on marijuana dispensaries. Is it going to be an economic boom? A surge in Treasure Valley visits?

ONTARIO — One sign of changing times in the conservative border town of Ontario: An old Oregon State Police office and crime lab is about to become a marijuana dispensary, possibly the first pot shop to open in the city since voters lifted a ban on marijuana sales last November.

The building is located at 325 Goodfellow St., within a quarter-mile of Interstate 84 and a block from some of the city’s big-box retail stores on the east side of town, including Walmart and Home Depot. It’s now under renovation and is expected to open before summer, Hotbox Farms LLC co-owner Steven Meland said last week.

It’s just one of four marijuana dispensaries that Hotbox Farms plans to open in Ontario, and it has several other related businesses in the works. A CBD oil store could be open as soon as this spring, Meland said.

And the lure of a city that is just across the Snake River from Idaho could not be more clear.

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Dan Cummings, community development director in Ontario, Oregon, was the one who drew 1,000-foot circles around schools and parks to delineate where dispensaries can and cannot be. Most of the dispensaries will be to the east of I-84, where most of the city’s popular retail stores are already located. Katherine Jones kjones@idahostatesman.com

This Oregon farming community, less than an hour from Boise, is already a big draw for shoppers who don’t want to pay Idaho’s sales tax, according to Ontario Community Development Director Dan Cummings. The city of about 11,000 more than quadruples in size each day, with most of those visitors coming from Fruitland, Payette and the Treasure Valley, he said.

Marijuana sales, which have proved popular up the interstate in Huntington, Oregon, could provide a new economic jolt. The opening of a dozen or more dispensaries this year is expected by many to turn the city into a magnet for cannabis users throughout southwest Idaho. Cummings expects half of the proposed dispensaries to open within six moths and the rest later in the year.

“A lot of people think that we’re going to have such a huge influx of traffic, maybe for the first few days,” he said. “But I’m a firm believer that we’ve already got probably 80 percent of those people coming here shopping anyway. I could be wrong, but that’s my assumption.”

It might even help other Ontario businesses.

“We’re hoping that it brings business to the downtown area,” said Tower House Coffee owner Zach Van Matre, who is disappointed that city regulation of the new industry has effectively relegated the new pot shops to the outskirts of town, near the interstate.

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Zach Van Matre, owner of Tower House Coffee, is hoping that the influx of marijuana shoppers might help business at his downtown Ontario coffee shop. Katherine Jones kjones@idahostatesman.com

For others in the city, which made the decision to “opt out” when Oregonians voted in 2014 to legalize recreational marijuana, it’s still culture shock. And for officials in Idaho who have steadfastly stood against even medicinal-marijuana legalization, there is some worry about what could be headed this way.

“Sit down with any addict, and they’re going to say, ‘Yeah, I started with marijuana,’ ” said Canyon County Sheriff Kieran Donahue, whose many concerns include an increase in Idaho youth experimenting with drugs. “I think Ontario is really making a mistake.”

Ontario officials are focused on capitalizing on this new industry as much as they can, as they believe that even Idaho might join in legalization within the next five to 10 years. State projections show that the city could receive $600,000 to $1 million a year from the tax on pot sales, Cummings said.

“Ontario has a limited amount of time in which we will receive a significant boon of revenues,” according to recommendations in a paper authored by Ontario City Manager Adam Brown and his assistant, Peter Hall. “We must wisely invest this in our community to better ourselves for the future when acceptance is the norm across states, and Ontario loses its current advantage.”

More buyers from Idaho than Oregon

Longtime Idaho Gov. Butch Otter strongly opposed the legalization of marijuana, and so, too, does his successor, Gov. Brad Little. And there appears to be no will by the Republican-controlled Legislature to soften the state’s pot laws.

The closest place for Treasure Valley residents to buy marijuana legally is at two dispensaries operating in tiny Huntington, Oregon, about 30 miles northwest of Ontario: 420Ville and Hotbox Farms.

Huntington has fewer than 500 residents. The two dispensaries, which opened in 2016, did almost $15 million in marijuana sales in 2017, and they were on pace to top $25 million last year, according to The Malheur Enterprise.

Nine out of 10 cars parked outside the dispensaries one afternoon last week had Idaho plates, and it’s an open secret that most patrons of the pot businesses come from across the state line. The Boise-Nampa metropolitan area has more than 700,000 residents, a much larger pool of potential patrons than sparsely populated eastern Oregon.

“We do not collect data on our customers,” Meland told the Statesman. “However, we do expect that we will see just as many out-of-state customers in Ontario as we currently do in Huntington.”

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Marijuana is legal in Oregon, and a billboard in Ontario advertises a dispensary in Huntington, about 80 miles from Boise. Now the race is on to open shops much closer to the Treasure Valley. Katherine Jones kjones@idahostatesman.com

The Hotbox Farms in Huntington, a bright red building with a neon green door, was busy between 2 p.m.-3 p.m. on a recent weekday afternoon. Most customers were men who appeared to be in their 20s and 30s, but there was at least one couple in their 70s.

As Beatles tunes like “Day Tripper” played and ceiling fans whirled, buyers queued up in a fast-moving line to purchase all sorts of marijuana products, including vape pods, edibles (gummies, chocolate, cookies and pretzels) and soaking salts. The mood was light, and the staff were moving to fill orders as if the roof was on fire.

Meland said Hotbox Farms employs 35 people, most of whom make $15+/hour. He expects to have 100 on the payroll by this summer, with the Ontario operations ramping up.

Despite the money being generated by Oregon’s legalization and the other economic benefits, Ontario Mayor Riley Hill doesn’t think the 3 percent sales tax on recreational marijuana that cities are allowed to impose is sufficient. He’s asking state lawmakers to allow the city to raise that to 18 percent, he told the Statesman. One thing the new mayor would like to use pot revenues for is to pay the city’s $10.9 million debt to Oregon Public Employees Retirement System.

Hill ran for the city’s top post as a vocal opponent of marijuana legalization, an issue that he said divided the city. The vote was 1,904 in favor, 1,450 against, The Argus Observer reported.

“If you look at the Colorado experience and experiences in other states, you can see that you have increased contact with the police, more homeless,” Hill said. “It’s also an impediment for employment if you want to be in the health care industry or trucking. It stays in your system ... It was just a lot of things that doesn’t seem positive for the community.”

No pot stores downtown

A week before Ontario voters made a decision on marijuana sales, people who wanted to open a dispensary began camping outside Cummings’ office. Numbers he painted on the sidewalk to impose some order have begun to fade.

To get people to go home after the election, he handed out numbers that set the order for an application process. Interested entrepreneurs were required to show that they had secured, through lease or purchase, a property to open their dispensary. Cummings said 28 such applications were submitted; since then, applications for conditional use permits for 12 sites have been submitted.

Those seeking business licenses have to pony up some serious cash: $1,200 application fee, $220 for each employee over the first five, $5,000 for the license, and a $7,500 bond. That’s about $14,000.

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Before the vote, business representatives began lining up at the Community Development Center to get a jump on marijuana dispensary operations, causing Director Dan Cummings to spray paint numbers on the sidewalk to keep things orderly. Katherine Jones kjones@idahostatesman.com

Ontario didn’t put a limit on the number of marijuana dispensaries that can open up in the city, but its regulations effectively do that by setting limits on how close they can be to each other and to other things.

The city is requiring 1,000-foot buffers from schools, parks and other pot shops, as well as a 500-foot buffer from residential areas. That’s why most of the dispensary sites will be on the east side of town and not downtown.

Ontario’s downtown, centered around Oregon Street, has shopping options for people looking to buy jewelry, shoes, clothes, appliances and even sports trading cards. That’s also where you’ll find the Ontario Poker Room and Social Club.

Many, but not all, of the downtown businesses are glad that pot shops won’t be setting up there, said John Breidenbach, president of the Ontario Chamber of Commerce.

“The biggest comment I’ve heard is that at least the city was proactive before they got their licenses,” he said. The chamber did not take a position on the matter before the election.

“I don’t want to say that the chamber is excited with the new economic stimulus. We’re going to wait and see what’s going to happen,” Breidenbach said.

One of the things he’s seen as a positive is that the new wave of entrepreneurs is renovating some older buildings around town. The potential pot dispensary sites include a used car lot, a shuttered restaurant, a contractor’s storage building and a bowling alley property. Other sites are empty lots, including one that’s between a Dollar Tree and the Oregon Department of Humane Services office.

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Hotbox Farms is currently one of two marijuana dispensaries in Huntington, Oregon, about 80 miles from Boise. Hotbox plans to open four dispensaries in Ontario. Hotbox features about 40 varieties of marijuana bud. Katherine Jones kjones@idahostatesman.com

Pot in Idaho

If you get convicted of marijuana possession in Idaho, you’re going to face stiff penalties.

It’s a misdemeanor if you’ve got less than 3 ounces, but you still could face up to a year in jail and a $1,000 fine. Get convicted of felony possession and you’re looking at up to five years in jail and a $10,000 fine.

Idaho law enforcement officials are keeping a close eye on what’s happening in Ontario, though police say they won’t be attempting to profile people who might be transporting marijuana home with them.

“We can stand strong against the marijuana movement,” said Donahue, the Canyon County sheriff. “That’s what I do. That’s what I say to our legislators, because there are absolutely devastating side effects to this idea, and it’s playing out in places like Oregon, Colorado and Washington.”

Payette County Sheriff’s Lt. Andy Creech said they haven’t seen any major spikes in crime or other issues since dispensaries opened in Huntington. Deputies are directed to cite and release those caught with misdemeanor amounts of pot.

“That’s mainly because our jail is full,” he said. “We don’t have room to house nonviolent offenders.

“It’s still against the law in Idaho, and we’ll be enforcing the laws. They should do that in Oregon, and not bring it back to Idaho.”

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Voters in Ontario, Ore., lifted a city ban on marijuana businesses last November. Katherine Jones kjones@idahostatesman.com

Donahue said he is concerned about the trickle-down effect of legal marijuana in Ontario, including trafficking in Idaho, driving under the influence and drug-fueled criminal behavior.

“People say, ‘It’s harmless. There’s nothing to it.’ No, you’re altering the psyche of a person,” Donahue said. “People do dumb things and criminal things when they’re high, and when they’re drunk, too. I don’t want to exclude alcohol.”

The Idaho Freedom Foundation is one prominent group that would like to see Idaho’s approach to marijuana change, something it advocated for even prior to the move in Ontario. In early January, IFF President Wayne Hoffman told KIVI Channel 6 that the group’s work to decriminalize the drug would be an initiative during this legislative session.

“When it comes to our laws, they are outdated, and the Legislature is going to have to take some steps to recognize that this is a growing problem,” Hoffman told KIVI.

He said the group does not have a sole purpose to legalize the drug, though he noted that even Utah has legal medical marijuana now.

“We could talk about decriminalization. You don’t have to necessarily legalize marijuana, but you could decriminalize possession of small amounts, for example,” he said.

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