Youngstown beats odds in medical pot sweepstakes

After years of being over- run by the Three Cs – Cleveland, Cincinnati and Columbus – in the highly competitive field of economic development, Youngstown has finally emerged victorious.

On Thursday, a city-based company, Riviera Creek Holding LLC., was granted a permit by the state to operate a medical marijuana-growing site.

Riviera Creek, operated by Brian Kessler and his nephew, Daniel Kessler, will cultivate up to 25,000 square feet of cannabis, with the possibility of expanding to 75,000 square feet of growing space.

The Kesslers will renovate their building at 1275 Crescent St. that housed Maui Toys Inc. It has been vacant since earlier this month.

“The first order of business is getting quotes to put the security in place, do construction to make it easier to produce the products and move equipment into the location,” said Daniel Kessler, the company’s chief operations officer.

We’re pleased that Kessler mentioned security first, given the history of drug-related crimes in Youngstown.

As we said in an editorial in May when six groups were seeking permits to locate marijuana-growing sites in Youngstown, “ … we would be remiss if we did not issue this warning: Beware the drug gangs in the city that have turned neighborhoods into war zones, and organized-crime types who will attempt to infiltrate the legitimate businesses.

“While the cultivation sites will have round-the-clock security, the Youngstown Police Department and other law enforcement agencies have a role to play in keeping unsavory characters away from this legal industry.”

The fact that Youngstown will have one of the 12 Level 1 sites is a victory for this region. More often than not, the Mahoning Valley has been on the losing end of economic development initiatives pursued by the major metropolitan areas in the state.

The Level I sites will provide the bulk of the medical cannabis that will be sold in state-licensed dispensaries.

Medical conditions

A doctor’s prescription will be needed to buy the drug to treat any one of 21 different medical conditions, including epilepsy and severe migraines.

The marijuana will not be sold for smoking. Products will be available in many forms, including oils, tinctures, capsules or edibles and metered oils or solid preparation for vaporization.

In addition to the 12 Level 1 cultivation sites, there will be 12 Level 2 sites that will provide a maximum of 3,000 square feet of growing area.

In Youngstown, the Kesslers of Riviera Creek are committed to investing $10 million to $15 million over three years, and creating at least 181 jobs and up to 319 jobs by 2022.

In the first year of operation – cultivation of the cannabis must begin in September 2018 – the Crescent Street facility will have 71 employees.

There’s no doubt medical marijuana will be an economic boon for Ohio.

In 2016, legal marijuana sales in the U.S. – for medicinal and recreational purposes – topped $6.7 billion, a 24 percent increase over 2015.

There are 26 states that allow the use of cannabis. Ohio joined the list last year when Republican Gov. John R. Kasich signed into law a bill passed by the Republican-controlled General Assembly.

There were 185 applicants for medical marijuana cultivator licenses, of which 12 were selected last week. The other 12 permits for the smaller operations were issued last month.

The state also will license 40 processors to make the oils and other products, and sign off on 60 dispensaries. There also will be an unknown number of testing labs.

The approval of Riviera Creek Holding’s application for its Youngstown site could not have come at a better time for city government.

With a projected $2.5 million general fund deficit in 2018, the pressure will be on the administration and city council to find new sources of revenue or make major cuts in spending. Most of the general fund revenue goes to employee wages and benefits.

Daniel Kessler, Riviera Creek’s COO, is well aware of the project’s importance.

“It’s very, very exciting,” he said. “We’re excited for the city – the new jobs and the tax revenue – and for the patients this product will be able to help.”

Time will tell if medical marijuana cultivation is a good fit for Youngstown.