The marijuana business is a huge money maker that attracts a lot of people, and a popular lake shore community seems like a great opportunity despite the challenges of getting marijuana business off the ground. Receiving local permits and gaining the support of local communities, raising capital to finance operations, and dealing with the power requirements for marijuana grow operations are enormous hurdles that need to be overcome to ensure success.
Marijuana is illegal at the federal level, and because banks are primarily federal entities, financing operations is challenging. Rather than working with traditional lenders to finance operations, those interested in marijuana are more likely to find investors. Since until recently marijuana has been illegal in America, some people with both the financial capital and knowledge of the industry required to achieve success, have histories involving criminal activity. This, coupled with municipal ordinance citizenship requirements to receive permits, encourages local citizens interested in opening provisioning centers to partner with big players in the marijuana industry, no matter the latter’s history.
In addition to financing operations, building the electrical infrastructure necessary to power grow operations is challenging. According to an economic report prepared by MSU on Michigan's recreational industry from March 2020, “Access to sufficient electricity generation capacity is particularly important for indoor marijuana growing facilities.”
An article by Dan Brekke entitled After Lawsuit, Managers of Defunct Oakland Cannabis Business ‘Disappeared Overnight’, highlights the difficulties in operating a cannabis grow house and processing facility. The article is about a grow operation in Oakland, California that was able to secure $54.5 million in financing through a Canadian bank. It describes electrical grid issues, and how the grow operation maxed out the capacity of the transformer. In order to have enough electricity, diesel generators were leased. Quoting from the article, “The biggest of those was the fact the two buildings didn’t have sufficient electrical supply to power the planned cannabis grows. As operations expanded at the properties, the existing transformers failed. To keep the grow lights on, Green Sage began installing semi-trailer-sized diesel generators without obtaining the needed permits from the city or the Bay Area Air Quality Management District.”
When the borrower’s business collapsed, they seemingly disappeared overnight, and the bank has had much difficulty tracking them down. They have been sued at least 32 times. “The most recent suit (PDF) was filed in June in Denver by United Rentals, one of the companies that leased diesel generators to Green Sage. The firm is seeking $1.75 million in rental charges it says Green Sage failed to pay.” The article goes on to tell how difficult it can be to determine who the owners are, and how it is difficult to locate them. There are layers upon layers upon layers of organizations and agreements involved.
Another article from M-Live, Outrage prompts Consumers Energy to pause 20-mile high-voltage power line project, highlights a grow facility’s power issues that are much closer to home. Consumer’s Power proposed a plan to construct a new high-voltage power line in Van Buren county. The power line would require an enormous number of trees to be removed and have additional environmental impact. According to the article, "Lawrence-Crandall Business Centre is home to multiple businesses, but the one getting public attention is 305 Farms, a cannabis grow and processing facility. Residents and local officials have said the power line is mainly to benefit the marijuana business, but Consumers denies that.” Residents opposed the project. County and local officials opposed the project. The biggest benefactor appears to have been a cannabis grow facility.
Energy issues with growing marijuana are so common that there are specialty businesses and consultants that operate in this space. Grand Haven Mayoral Candidate Andrea Hendrick’s business partner at, I Site Consulting Group, Landon Bartley, is one such person. Bartley is a specialist in energy, marijuana, and difficult land use problems such as what Grand Haven has with Harbor Island.
Photo courtesy of Keen Technical Solutions, LLC
Another expert in this space is Keen Technical Solutions, LLC. Based in Traverse City, Michigan, Keen helps growers with all related construction, facilities, and energy needs. According to their website, “Electrical demand by legal marijuana growers is expected to rise by 162% by 2022.” And “At Keen, we work with growers no matter where they’re at. From ground-up construction of facilities to upgrading outdated systems, we can help industry leaders learn, adapt, and grow more efficiently.”
Coincidentally, Keen Technical Solutions, LLC has a lien on the property where Candid Labs Corunna, LLC is located.
Candid Labs is owned by Ramon Hana, Andrea Hendrick’s business partner in the deal to purchase the former Rendezvous Restaurant and turn it into a marijuana provisioning center.
Grand Haven City Council members Karen Lowe and Kevin McLaughlin have both donated to Andrea Hendrick. Andrea Hendrick has business interests in the marijuana industry. Karen Lowe is the treasurer for Andrea’s campaign. Andrea is affiliated with the Board of Light and Power Charter Change Coalition (BLPCCC) and actively trying to place control of the Board of Light and Power under the City of Grand Haven while simultaneously running to be mayor. Growing marijuana takes a lot of energy and Harbor Island has energy infrastructure. Harbor Island seems like a prime location to put in a grow operation.
These issues show that it is extremely important for businesses seeking to establish marijuana grow facilities to have control over electrical facilities. We are speculating that marijuana could have something to do with the BLPCCC attempt to place the BLP under the complete control of the City of Grand Haven.