Joe Kukura 3 (1)

Sigh of ReLeaf

One of the first San Francisco cannabis dispensaries to open in the old medical marijuana era was also one of the first to shut down in the new recreational marijuana era.

ReLeaf Herbal Cooperative, which has been doing business at Ninth and Mission streets since medical dispensaries became legal in 2005, sold its last sack and was shuttered on Dec. 15.

ReLeaf did not shut down because they were losing too much money, nor because of some FBI raid like we used to see back in the early days of legal dispensaries. ReLeaf shut down because their landlord evicted them. And thanks to the archaic, 2005-era laws under which they got their permit, ReLeaf was “landlocked” to their original 1284 Mission Street location and not allowed to do legal business anywhere else in San Francisco.

“Our landlord was in need of refinancing an existing loan and the bank was not allowed to support a cannabis tenant at the property location,” ReLeaf said last November, on their website which has since gone up in smoke. “Through no fault of our own and after being served a formal eviction notice and fighting our best legal fight for possible solutions, we are made to come to the harsh reality of having to cease operations at 1284 Mission St. effective Dec. 15, 2019.”

But ReLeaf will rise again at a new location, probably in the Ingleside neighborhood. The San Francisco Board of Supervisors passed a measure last Tuesday allowing legacy-permitted medical cannabis dispensaries to change their permit addresses, a right the newer dispensaries have had for years.

Under the old-timey, early rules by which ReLeaf got its 2005 permit, the Department of Public Health regulated the marijuana trade instead of the modern-day San Francisco Office of Cannabis. The Health Department is of no help when your landlord kicks you out because your weed presents banking risks, even though cannabis banking is rapidly normalizing.

“There is one thing that remains stagnant in this industry ⁠— federal law,” ReLeaf owner Heidi Hanley told the Board of Supervisors Land Use and Transportation Committee a month after the dispensary closed. “We still find ourselves evicted and our business shut down through the federal banking laws.”

ReLeaf was an old-school medical dispensary that never tried to turn into some fancy Apple Store imitation. Their consumption lounge was merely a card table and two folding chairs. But ReLeaf’s no-frills storefront and dirt cheap prices made it a popular legacy dispensary.

That’s why a public outcry led Supervisor Matt Haney to write up the new location permit legislation to correct this flaw in the old rules. “It is a serious issue that can lead to a business shutting down altogether if they are one of the older operators,” Haney tells SF Evergreen.

Haney calls his bill a “stopgap measure,” because the new recreational-use, equity program dispensary permits all include portability, or the ability to be transferred to a different street address. “Moving forward with new equity businesses, there will be portability, so this won’t be an issue,” Haney says.

This is not some sweeping legislation, the bill only affects a very small number of dispensaries that were permitted under old rules from more than ten years ago. But the specifics of ReLeaf’s forthcoming relocation are raising suspicions that this legislation might end up benefiting predatory landlords more than dispensaries.

Board of Supervisors president Norman Yee voted against the bill for that very reason. “The portability of this particular permit currently only applies to two locations in San Francisco, 1940 Ocean Avenue and 1545 Ocean Avenue,” Yee said at last Tuesday’s meeting, referring to ReLeaf’s application to relocate. “One of these locations previously evicted [a dispensary.]”

That location is the former home of the now-defunct 1944 Ocean Cooperative, who claim they were illegally evicted. Hoodline reported in August that the dispensary sued its landlord for wrongful eviction. That case completed its closing arguments on Feb. 19, though the San Francisco Superior Court judge’s ruling has not yet been made public.

But Sup. Yee said that landlord Lamax Nguyen “is now turning around and selling the property, knowing that this legislation will benefit them.” (Indeed, that property is listed as asking $4 million.) “We do not want land use speculators and commercial property owners to have the upper hand, to charge top dollar and displace tenants so they can make more profit.”

In response, Haney added an amendment to the bill barring dispensaries from relocating to any site where the new landlord had wrongfully evicted a previous dispensary tenant.

It’s still no certainty whether ReLeaf will end up reopening at one of the two Ocean Avenue locations they’re applied to move to. But the mere fact that they’re allowed to apply for a move, a right they’ve never had even though newer dispensaries do, certainly spells relief.