Kenai’s first commercial marijuana business — Red Run Cannabis Company — has permission from the Kenai Planning and Zoning Commission to open a cultivation facility and shop beside the Spur Highway in Kenai’s Thompson Park subdivision, an area where commercial zoning sits adjacent to residential zoning. The store’s proximity to the neighborhood had led to opposition from some owners of nearby houses.

After delaying Red Run’s permit at a March 23 meeting, the commission voted 5-1 to grant the permit on Wednesday. Commissioner Glenese Pettey voted against the permit, saying the store “is not in harmony with the surrounding properties, and it would be detrimental in the aspect of property values.” Commissioner James Glendening was absent.

Red Run’s prospective location is an abandoned gas station and convenience store in a highway bordering strip of limited commercial zoning. The property’s owner Roger Boyd, a Red Run co-founder with Eric Derleth and Marc Theiler, said that his business would be appropriate for the zone, which he said was intended to create a transition between commercial and residential neighborhoods. Boyd also addressed fears that property values would be damaged by a nearby marijuana store.

“The truth is that no one knows what the impact on property values would be,” Boyd said. “I would contend that our proposed business is no more a detriment to surrounding property values than the liquor store that was there for years, or the Eagle club down the street. One thing I’m certain of, though, is that if you take this building that’s been empty for a couple years, a little grown-up around it, and we go in there and clean it up and put a vibrant business in it, that will have an effect of improving property values of both the residential and commercial properties in the neighborhood.”

Another frequently-voiced objection to the business was that it would lead to a local increase in trespassing and crime. Theiler, who lives near the shop location and said he uses the bike path near the property frequently, said he has seen used condoms and syringes littering the alley behind the currently-vacant building, where the gas station lot borders the yard of Christine Cook, who has opposed the permit over safety concerns. Theiler said Red Run intended to fence off the rear alley. He argued that with the building occupied and with the light and camera systems the owners intend to install, illicit activity in the neighborhood would go down.

Cook said she wasn’t ideologically against commercial marijuana but opposed locating it in a narrow area of commercial land close to a neighborhood.

Patricia Patterson, owner of Soldotna’s Lucky Raven Tobacco store, said Kenai’s marijuana regulations had played a role in creating the disagreement between residents and the business by limiting the possible locations a marijuana business could operate in town. In early 2016, Kenai passed laws creating 500 foot set-backs for marijuana businesses from recreation centers, churches, correctional facilities, or drug abuse treatment centers, and doubling the state’s 500 foot setback from schools to 1000 feet, as well as choosing to measure the setbacks in a more restrictive way than the state. The planning and zoning commission created early drafts of the Kenai marijuana rules, which were amended and passed by the city council on Jan. 20.

“It’s true — we have a lot of retail, a lot of commercial along the Spur highway with houses close by,” Patterson said. “That is the face of our community. I think it is something that might be hard for the neighbors to see. So it does come down to ‘that is the way we zoned.’ That was the recommendation, to do these big circles and big buffer zones that kept a lot of the (marijuana) retail out of the city of Kenai and put them towards the outside of Kenai. That was a choice that came from this committee.”

Pettey said she intended to vote according to what she described as the original intent of Kenai’s marijuana regulations — to exclude cannabis businesses from residential areas, which she interpreted to include Red Run’s proposed location.

“I believe it was the intent not only of planning and zoning but of city council to keep retail marijuana stores out of residential areas,” Pettey said.

Kenai City Attorney Scott Bloom said he would “respectfully disagree, to some extent.”

“By our planning and zoning table, a retail establishment would be allowed on this property by conditional use permit,” Bloom said. “That intent was to keep it out of residential neighborhoods, and I’d have to say that that property is not located in a residential neighborhood. It’s adjacent to one, but not within the residential neighborhood.”

Commenting before the vote, some commissioners said they would vote for the permit based on its compatibility with the zoning code, but against their personal inclinations — a feeling expressed by commissioner Kenneth Peterson, who said he felt as if he was “playing devil’s advocate” by voting in favor.

“When this first came up, as a resident of the city and a parent, I wasn’t sure how I was going to feel about it,” said commissioner Diane Fikes. “And then sitting on the commission, and having to realize that the city had said yes, the state had said yes, we want to do it… What we’re here for today is nothing on a moral or civic issue, but everything on a land use and a zoning issue. I believe everything has been met, and all the questions I have have been answered.”

The Kenai conditional use permit will be open for appeal for 15 days. Red Run’s next license will come from the state Marijuana Control Board, which posted notice that the license had been received on Feb. 24, 2016. During the state licensing process, the Kenai city council will be able to vote on whether or not to object to the license. An objection would cause the state to deny the license. The council would also be able to object during Red Run’s yearly state license renewal. Theiler said that if everything goes according to plan, Red Run could have product for sale in September 2016.

Reach Ben Boettger at ben.boettger@peninsulaclarion.com.