Seaside approves dispensary ownership transfer amid resident calls for audits and transparency

The Seaside City Council approved a transfer of an existing cannabis dispensary development and operating agreement (formerly Higher Level of Care) to STSI LLC and discussed conditions intended to provide oversight while reducing administrative burden on city staff.

Housing and Planning Manager Andrew Myrick explained the transfer process and summarized three principal modifications in the proposed agreement: (1) the $15,000 annual community benefit remains but the new agreement permits the business some flexibility in selecting the six in‑city nonprofits that receive the funds; (2) the agreement replaces explicit city audit rights with a contractual requirement that the business provide an annual report in a standardized format; and (3) wage standards were added to the agreement to correct a missing exhibit in the original 2018 documents and establish minimum pay floors for employees.

Councilmembers asked whether other dispensaries are complying with similar donation agreements and wage terms. Myrick said the city has the ability to audit but has not systematically done so — largely a staffing and prioritization issue — and that staff can request audits and bring a future agenda item to review compliance across all dispensaries.

Residents urged stronger enforcement. Diane Nielsen and other speakers asked who chooses the nonprofits, asked that the city verify the donations, and suggested audits rather than relying solely on company-provided reports. Myrick replied that the new agreement requires the nonprofits to be located in Seaside and that staff will design the reporting form to specify required supporting documentation; the city can still perform audits where warranted.

Council approved the transfer (pulled from consent) after questions and public comment. Councilmembers also directed staff to consider checking other dispensary agreements for consistent wage standards and to return to the council for follow-up if necessary.

Key quotes

"There would still be $15,000 donated annually to nonprofits located in the city of Seaside, but there would be no flexibility as to which six nonprofits those were" in the original agreement; the new agreement keeps the $15,000 but allows the business to select recipients subject to in‑city residency criteria, Myrick said.

"We can look at what's going on with the other dispensaries if desired," Myrick said when asked about consistency.

Vote and next steps

- Transfer approved by council (motion carried; recorded vote in transcript shows unanimous approval of item pulled from consent).
- Staff to return with a report on compliance across dispensaries and consider audit options; staff to prepare the standardized reporting form (potentially with certification requirements such as CPA signoff if council desires).