By Nathaniel Popper
Jeff Williams, the incoming mayor of this small desert city
near the Arizona border, arrested a lot of people for selling marijuana
in his days as a county sheriff. He voted against legalizing the stuff
in a 2016 statewide referendum.
But
Mr. Williams also knows the city he has called home since he was in
second grade has seen better days. The railroad jobs have mostly gone
away. And people don’t stop off on the old Route 66 as they used to.
So
Mr. Williams, a slender 54-year-old, has become the unlikely leader of
Needles’s unlikely effort to turn itself into a new kind of industry
town dedicated to the growing business of cannabis.
“If
a small community like this isn’t growing, it’s dying — and that’s what
we were doing,” Mr. Williams said. “We needed to do something.”
The
City Council in this solidly Republican community of 5,000 people has
approved 81 permits for cannabis businesses since 2015. Four stores are
selling marijuana to the public — about 100 times the number of
dispensaries per person over the entire state.
Almost
every block in Needles has a run-down building like the old Relax Inn,
which is being converted into a cannabis growing facility. Or a new
building going up for manufacturing oils and edibles. If all the
projects pan out, local officials hope they will generate more jobs — an
estimated 2,100 — than Needles has altogether right now.
“You
would be hard-pressed to find someone in town who their brother, uncle,
sister, aunt, cousin or themselves isn’t involved in the industry,”
Rick Daniels, the city manager, said in an interview at Needle’s
single-story City Hall.
If Needles,
Calif., rings a bell, there is a reason. The historic Route 66, the road
traveled west by many of Southern California’s 20th-century settlers,
cuts right through town. Needles was the Joad family’s first California
stop in “The Grapes of Wrath,” by John Steinbeck.
Needles
also was the first place train crews swapped out on freight trains
headed east out of Los Angeles. That created hundreds of jobs.
But
like many other small towns on the way to Los Angeles, Needles used to
be a lot more important.
The railroad cut the size of its train crews,
and the elegant depot building in Needles is mostly empty. Needles lost
its last grocery store in 2014. More than a quarter of the city’s
residents live below the poverty line. Bit by bit, the jobs and the
people were leaving.
In Mr.
Williams’s first go-round as mayor from 2006 to 2010 (he was also a
member of the City Council for four years), he tried to attract the
solar industry. When that failed, he was drawn to the opportunity in
marijuana by a friend who wanted to open a dispensary. California
residents had voted to allow medical marijuana years earlier, in 1996.
Mr.
Williams spoke with doctors about the potential benefits and slowly got
over some of the antipathy toward the drug that his parents and his
years as a police officer had instilled.
“It was like turning a battleship. It was a long process,” he said in a recent interview.
Mr.
Williams, who said he still had not smoked marijuana himself, worked
with the city manager and a lawyer to put together a ballot measure in
2012 that imposed a 10 percent tax on cannabis businesses. It passed
with 81 percent of the vote.
“This is a very politically conservative town — but it’s got a streak of libertarianism,” Mr. Daniels, the city manager, said.
The
first dispensaries in town still faced opposition, especially from
local evangelical churches. But they have failed to attract the bad
elements some expected. Crime has been stable over the last few years.
At
the Wagon Wheel, the city’s oldest restaurant, a small souvenir shop
now offers flags with the marijuana leaf and commemorative signs for
Route 420, a code number of sorts for marijuana, along with the old
Route 66 memorabilia.
California
voted in 2016 to legalize the sale of marijuana for adult use. Most
communities have been slow to embrace it because it is still illegal
under federal law.
Cheryl Luell, owner of the Healing Center, one of four marijuana dispensaries in Needles.CreditJoe Buglewicz for The New York Times
But
several cities in economically struggling parts of the state have
seized on the opportunity. Needles has competition from other small
cities east of Los Angeles, like Desert Hot Springs and Adelanto.
With
cannabis has come some trouble. Months after the first dispensaries
opened in Needles, they were raided by federal agents. No charges were
brought, but the products that were seized were never returned.
And
federal authorities recently arrested officials in nearby Adelanto and
accused them of giving out cannabis permits in exchange for bribes and
personal favors. A trial is pending.
“When
you open up your community and say, ‘This is a free-for-all, come on
in,’ you run into danger,” said Tristan G. Pelayes, a former mayor of
Adelanto who now works as a lawyer representing some of the accused
officials.
Needles’s
officials are acutely aware of the risks. Mr. Daniels, the city
manager, has barred city employees from accepting so much as a cup of
coffee from local businesses. Like other city employees, Mr. Daniels has
to pass regular drug tests that ensure he never uses pot.
“This industry is so critical to this community’s future — we just cannot afford to screw it up,” Mr. Daniels said.
At
a meeting of the City Council in November, three of the five items on
the agenda were related to cannabis. No one voiced opposition. Most who
did speak up were dispensary owners, who asked the police to take a
harder line on illegal drug sales.
Lyn
Parker, the secretary of the city’s chamber of commerce and a former
teacher in the city’s schools, said cannabis was not the first industry
most of her members would have chosen. But they have made peace with it.
“I
don’t think cannabis is going to drive anything away because it wasn’t
coming anyway,” Ms. Parker said. “Would we like a small industry here
instead? Sure. But we’ll take anything to help our town.”
But
pockets of opposition remain. Thomas Lamb, the pastor at the Needles
Assembly of God, said he had seen marijuana becoming more of a problem
for children in the grade school he oversaw.
A cannabis company asked to
buy the property where his church and school sit. He quickly said no.
“The
people who have come into Needles want to buy up every available piece
of property, including our church, to manufacture their product,” he
said. “Quite frankly, it’s a little bit overwhelming.”
The
dispensaries selling joints and vape pens are only a small piece of the
weed business that city officials envision. Far more tax dollars are
expected to come from companies that are growing and manufacturing
marijuana products for other parts of the state, like Los Angeles, where
permitting and growing is more difficult.
The
city’s proximity to the Colorado River provides a steady source of the
water that marijuana operations need. And Needles owns its own
electrical utility, which allows it to offer electricity at about a
fourth of the cost of cities that rely on commercial utilities. That is
important for indoor marijuana cultivation under artificial lights.
Vertical
Companies, a large cannabis producer with headquarters near Los
Angeles, has purchased about 30 acres in Needles. It has a campus on the
edge of town with three new buildings and plans for three more.
Two
of the buildings house two floors of rooms that have been wired and
lighted for growing plants.
The other building is dedicated to
manufacturing facilities, where potent parts of the plant are extracted
in a series of machines and elaborate glass beakers.
Vertical
is also turning an old Kentucky Fried Chicken on Route 66 into a
kitchen for candies and baked goods made with marijuana oils.
Drew
Milburn, a former Marine who is in charge of Vertical’s local
operations, said he had looked at expanding in other cities in
California but none could compete with Needles’s electricity and water —
and its openness to his industry.
“Lots of cities welcomed us with opened arms, but very few cities finished it with a hug,” Mr. Milburn said.
Drew
Milburn, the chief operations officer of Vertical, in one of his
company’s buildings in Needles.
The
cannabis industry is expected to become the biggest generator of tax
revenue in town. It has already created 350 jobs and appears to have led
to a revival in property prices, which have gone up the last two years
after falling for nine. Starbucks recently agreed to open its first
branch in Needles.
The main danger
may be rapid expansion of the cannabis industry across the state, which
could push down marijuana prices and make Needles’s smaller facilities
unprofitable.
At the recent City
Council meeting, the only moment of hesitation about cannabis came when
one of the city councilors, Tom Darcy, proposed that the city open
applications for a fifth dispensary.
The
dispensary owners in attendance all opposed the idea. Another city
councilor, Shawn Gudmundson, suggested the council stick with four.
“We are cramming marijuana down our constituents’ throat,” he said. “Let’s let it play itself out.”
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