A Fort Smith cultivator will continue operating until at least late December after the owner appealed a state regulator’s decision Monday to revoke the cultivation license in accordance with a circuit court ruling.
Alcoholic Beverage Control Division director Doralee Chandler revoked River Valley Relief’s cultivation license after a nearly hour-long hearing Monday afternoon. River Valley owner Storm Nolan defended his initial application, which has come under fire after Circuit Judge Herb Wright sided with plaintiff 2600 Holdings (doing business as Southern Roots) in a case in which Wright determined the state erred in issuing Nolan’s license.
After the hearing Monday, Nolan appealed Chandler’s ruling to the ABC board, which begins a stay of the issue until the board hears the matter, according to ABC spokesman Scott Hardin. The board is next scheduled to meet on Dec. 21.
The pending appeal and stay mean River Valley will still be allowed to operate until the ABC board resolves the matter. A ruling by the ABC could be appealed to circuit court, Hardin said.
Nolan has a separate appeal of Wright’s ruling before the state Supreme Court. Nolan said he has asked the Supreme Court to stay the proceedings until the court hears his appeal.
Most of Monday’s hearing involved River Valley attorney Joseph Falasco questioning Nolan under oath about the three allegations against the Fort Smith cultivator. The allegations stem from a ruling by Wright who found that the cultivation facility’s original proposed location was less than 3,000 feet from a school, that the original business entity had been dissolved and that Nolan no longer possessed the property in his original application.
Wright stopped short of revoking the license and said the state should take “all steps necessary” to remedy the violations in the case.
Nolan addressed each count while under oath, saying that he had been trying to abide by the state Medical Marijuana Commission’s rules and the guidelines of the Secretary of State.
On the allegation that his proposed facility was too close to a school, Nolan said he did “legwork” to follow the commission’s rules and to make sure the proximity of the nearby Sebastian County Juvenile Detention Center would not disqualify the location. The commission’s rules, Falasco said, state that a cultivation facility cannot be within 3,000 feet of a facility operated by a public school district.
Nolan said the detention center is not operated by a public school district and that he consulted with the Arkansas Department of Education and with the administration and president of Fort Smith Public Schools to make sure the detention center was not one of their schools. Nolan said they told him the facility was not one of their schools.
Falasco later asked Nolan if he had learned anything about the proposed facility of 2600 Holdings, the plaintiff in the court case against him, but Chandler cut him off and told him to stick to the matter at hand. In a recent court filing, Nolan stated that 2600 Holdings’ proposed cultivation facility is situated 700 feet from a school bus transportation facility that is operated by the Jacksonville Public School District.
“We’re not here to litigate matters over any other location,” Chandler told Nolan. “You need to worry about your permit and your application.”
On the allegation that Nolan was ineligible for a license after dissolving his business entity, River Valley Production LLC, Nolan said he was following the secretary of state’s guidelines. Nolan said he believed it was his duty to dissolve the entity because the secretary of state says that businesses ceasing operations in Arkansas should be dissolved.
The ABC issued Nolan a fine of $15,000 over the issue of him dissolving the business entity. Nolan said he asked if he paid the fine if the issue would come up again and he said “Chip” told him it would not. Chip Leivovich is an attorney for ABC who handles medical marijuana, Hardin said.
“We’re not going down this road,” Chandler told Nolan.
