7.1 SR 06-17-2024City of
Elk -
River
To
City Council
Meeting Date
June 17, 2024
Item Description
Conditional Use Permit: Commercial Cannabis
Cultivation, 10700 165th Ave NW - Vireo Health
Request for Action
Item Number
7.1
Prepared By
Zack Carlton, Community Development Director
Reviewed by
Zack Carlton
Cal Portner
Tina Allard
Action Requested
Approve, by motion, the Conditional Use Permit authorizing establishment of a Commercial Cannabis Facility
with the following conditions to satisfy the standards set forth in Section 30-654:
1. The facility must comply with all licensing and operating procedures required under Minnesota
Statutes Chapter 342.
2. The Conditional Use Permit may be issued prior to the applicant having received all necessary state
permits and licenses, but the applicant shall submit proof of obtaining all state permits prior beginning
cultivation operations.
3. Issuance of this CUP does not exempt the applicant from all standards outlined in state statute.
4. The operation/building must connect to city sewer and water and pay the required SAC/WAC fees in
accordance with city codes.
5. Construction activities will require signed plans prepared by a qualified professional.
6. All other uses of the property must cease prior to issuance of a certificate of occupancy.
Background/Discussion
Vireo Health will utilize the former GRE facility at 10700 165th Ave NW and establish a Commercial Cannabis
Cultivation Facility. The site has largely been operated as a storage facility since GRE ceased operations on the
property, and the equipment used by GRE has been removed, leaving the building mostly vacant.
The property is zoned I I (Light Industrial) where Commercial Cannabis Cultivation facilities require a
Conditional Use Permit (CUP). The applicant received approval to operate a cultivation facility in part of the
existing building earlier this year. The applicant requests approval to operate in the entire structure.
The proposal includes staff and office spaces, drying and processing areas, and numerous sealed cultivation
rooms. Each cultivation room will have a positive -pressure HVAC system to minimize cannabis odor. The
cultivation rooms are also within the existing building, providing an additional barrier to potential odor
concerns.
The Elk River Vision
A avelcoming community zvitb revolutionary and spirited resourcefulness, exceptional service, and community p p W E H E 0 BINMURd372
engagement that encourages and inspires prosperity
Expected hours of operation are between 5:00 a.m. and 12:00 a.m. with 80 employees at full build -out. Vireo
will operate multiple shifts, spreading out the site's parking needs. The entire site will also have onsite security
and 24/7 surveillance.
Planning Commission
The Planning Commission held a public hearing on May 28, 2024. A representative for the applicant spoke
during the hearing and made himself available for questions from the Commission. No one else spoke during
the hearing.
The Planning Commission did not have any questions and unanimously recommended approval of the CUP
with the six conditions.
After the meeting, staff spoke with a nearby property owner who had questions regarding how odor from the
facility would be mitigated. Staff requested additional information from the applicant and received the
following response:
The cultivation and processing rooms, where odor will be present, are built in a room -in -room con figuration. This means
that fully sealed rooms will be constructed inside of the existing structure. The interior rooms are 16' - 20' toll. The
existing structure is 40' - 50' tall. This means there will be a significant air gap inside the existing structure. As a result,
there is very little possible transference between the interior of the structure and the outside. The rooms only take fresh
air on a limited basis according to the occupancy requirements. The structured air discharge is limited and, when it
occurs, is treated with carbon filtration. We also use an internal air scrubber system that limits VOCs. Cannabis plants
(all plants) off -gas terpenes, which are volatile organic compounds (VOG), which is what humans smell.
The only exception is in the event of o CO2 purge alarm. We supplement our grow rooms with CO2. As such, we are
required to hove a purge system in place if the CO2 reaches 5000 ppm. As a note, we operate at no more Mon 1200
ppm. The likelihood of a valve failure resulting in a purge is extremely low. In 14 years, I hove never seen one occur.
However, if it were to do that, air would be immediately evacuated, and the CO2 system automatically shuts down. The
air would not be treated, as the speed with which we are required to exchange in that case is too high and, therefore,
could potentially hove a cannabis odor. This is why I would never 100% guarantee Mot there is no way someone could
smell our plants.
I hope anyone concerned about this issue will understand Mot we take being good neighbors very seriously and
recognize that odors are a concern. As such, we go to great lengths to mitigate any potential issues. I am happy to talk
to anyone who would like more in formation on this matter at any time.
Financial Impact
None
Mission/Policy/Goal
Support the growth and development of the community.
Attachments
1. Planning Commission Packet dated May 28, 2024
2. CUP Recording Document
3. 7.1 Vireo Health Presentation
Page 130 of 372
City of
Elk - -
River
To
Planning Commission
Meeting Date
May 28, 2024
Item Description
Conditional Use Permit: Commercial Cannabis
Cultivation (amendment), 10700 165th Ave NW -
Vireo Health
Request for Action
Item Number
5.1
Prepared By
Zack Carlton, Community Development Director
Reviewed by:
Zack Carlton
Action Requested
Recommend, by motion, approval of the Conditional Use Permit with the following conditions to satisfy the
standards set forth in Section 30-654:
I. The facility must comply with all licensing and operating procedures required under Minnesota
Statutes Chapter 342.
2. The Conditional Use Permit may be issued prior to the applicant having received all necessary state
permits and licenses, but the applicant shall submit proof of obtaining all state permits prior beginning
cultivation operations.
3. Issuance of this CUP does not exempt the applicant from all standards outlined in state statute.
4. The operation/building must connect to city sewer and water and pay the required SAC/WAC fees in
accordance with city codes.
5. Construction activities will require signed plans prepared by a qualified professional.
6. All other uses of the property must cease prior to issuance of a certificate of occupancy.
Background/Discussion
Vireo Health will utilize the former GRE facility at 10700 165th Ave NW and establish a Commercial Cannabis
Cultivation Facility. The site has largely been operated as a storage facility since GRE ceased operations on the
property, and the equipment used by GRE has been removed, leaving the building mostly vacant.
The property is zoned I I (Light Industrial) where Commercial Cannabis Cultivation facilities require a
Conditional Use Permit (CUP). The applicant received approval to operate a cultivation facility in part of the
existing building earlier this year (CU 24-03), but the applicant is now requesting approval to operate a
cultivation facility in the entire structure.
The proposal includes staff and office spaces, drying and processing areas, and numerous sealed cultivation
rooms. Each cultivation room will have a positive pressure HVAC system to minimize cannabis odor. The
cultivation rooms are also within the existing building, providing an additional barrier for potential odor
concerns.
The Elk River Vision
A avelcoming community zvitb revolutionary and spirited resourcefulness, exceptional service, and community p p W E H E U A Y
engagement that encourages and inspires prosperity
jNPJURrd872
Expected hours of operation are between 5:00 a.m. and 12:00 a.m. with 80 employees at full buildout. Vireo
will operate multiple shifts, spreading out the parking needs of the site. The entire site will also have onsite
security and 24/7 surveillance.
Site Plan
The applicant is not proposing any modifications to the site. The existing paved surfaces provide enough
parking and circulation to support the use. Access to the site will continue from the existing driveway on
165th Ave NW.
The entire property is surrounded by a fence and proposed signage consists of a small navigational sign to
direct traffic to the correct access points of the building.
Exterior modifications include additional ingress/egress points as required by state building codes and reducing
the size of the existing overhead doors.
Public Utilities
The building is not currently connected to city sewer and water, but utility stubs were provided on the east
side of the building when the city installed Polk Street and the extension of 169th Ave. The building will be
required to connect to city utilities and pay the required connection fees. Additionally, the operation will be a
large electric user. The applicant has been working closely with Elk River Municipal Utilities (ERMU) to
address the electrical needs for the site.
Applicable Regulations
In approving a Conditional Use Permit, the council may impose such specific conditions with regard to the
development or operation of the proposed use as it considers necessary to satisfy the seven standards set
forth in Section 30-654 and the requirements contained in this article and to promote compatibility with and
minimize any potentially adverse effects upon adjacent properties, the neighborhood or the city.
The issuance of a Conditional Use Permit can be ordered only if the use at the proposed location:
1. Will not endanger, injure or detrimentally affect the use and enjoyment of other property in the immediate vicinity or
the public health, safety, morals, comfort, convenience or general welfare of the neighborhood or the city.
The property previously operated as a sorting facility for trash/garbage prior to being transferred to the
incinerator. The facility has traditionally had high levels of vehicle traffic and odors from the trash.
Surrounding properties include light manufacturing operations, recycling centers, a semi -truck dealership,
agricultural research, and vacant/ developable parcels. The proposed use will not generate concerns in excess
to what the area has experienced with previous uses and will not detrimentally affect the use and enjoyment
of other properties in the immediate vicinity. The use will also be subject to additional standards from the
state which may address related concerns for the operation.
Staff does not see a need to impose specific conditions to satisfy this standard.
2. Will be consistent with the comprehensive plan.
The subject site and surrounding properties are guided as Business Park which allows light manufacturing uses.
The proposed use is consistent with the long-term vision for the area.
Staff does not see a need to impose specific conditions to satisfy this standard.
3. Will not impede the normal and orderly development and improvement of surrounding vacant property.
The city owns a vacant developable lot and much of the surrounding agricultural research land has the
potential to be developed in the future. The proposed use will not impede the normal and orderly
development of surrounding vacant parcels.
PagRaM M872
Staff does not see a need to impose specific conditions to satisfy this standard.
4. Will be served adequately by and will not adversely affect essential public facilities and services including streets,
police and fire protection, drainage, refuse disposal, water and sewer systems, parks and schools; and will not, in
particular, create traffic congestion or interference with traffic on adjacent and neighboring public thoroughfares.
Vireo's operation will require a significant amount of electricity at full build -out. They have been working
closely with ERMU to find a solution to their power needs. The building is required to connect to city utilities
and the public infrastructure has the capacity to provide the noted water and sewer needs. Anticipated traffic
is equal to or less than previous uses on the site and existing roadway infrastructure has the capacity to
handle the traffic. The use will also be subject to additional standards from the state which may address
related concerns about the operation.
Staff included a condition requiring the building to connect to city sewer and water and pay all required
connection fees.
S. Will not involve uses, activities, processes, materials, equipment and conditions of operation that will be detrimental
to any persons or property because of excessive traffic, noise, smoke, fumes, glare, odors, dust or vibrations.
Cannabis manufacturing (growing) and processing has the potential to generate excessive odors. The applicant
is proposing to operate their grow operation within individual cultivation rooms that utilizes a positive -
pressure system to minimize off -site odors. These rooms are also within the larger building (a room within a
room) providing additional odor mitigation opportunities. There are no existing residential uses in the vicinity
of the site, and prevailing winds would generally blow odors over the agricultural fields south and east of the
subject site. The use will also be subject to additional standards from the state which may address related
concerns for the operation.
Staff does not see a need to impose specific conditions to satisfy this standard.
6. Will not result in the destruction, loss or damage of a natural, scenic or historic feature of major importance.
The site is fully built -out and there are no proposed changes to the site.
Staff does not see a need to impose specific conditions to satisfy this standard.
7. Will fully comply with all other requirements of this Code, including any applicable requirements and standards for
the issuance of a license or permit to establish and operate the proposed use in the city.
Commercial Cannabis Manufacturing is tightly regulated by Minnesota Statutes Chapter 342. Prior to
beginning growing operations on site, the applicant must receive all required approvals and licenses from the
state. The applicant will be required to provide proof of these approvals to the city. Outside of state
requirements, which will be reviewed separately by the state's Office of Cannabis Management, the use will
fully comply with city requirements.
Additionally, with the conversion of the entire building and site to Commercial Cannabis Cultivation, all other
uses of the property must cease.
Staff included conditions noting the requirement to receive all necessary approvals from the state prior to
beginning commercial cannabis operations and requiring any existing operations to cease prior to issuance of a
certificate of occupancy.
If denial of such a permit should occur, it shall accompany recommendations or determinations by findings or
a report stating how the proposed use does not comply with the standards set forth in Section 30-654.
PagRaM M872
Financial Impact
None
Mission/Policy/Goal
Meet changing needs - agile.
Responsibly grow.
Support the growth and development of the community.
Attachments
I. Location Map
2. Applicant's Narrative
3. Architectural Plans
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Project Location Map
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Colic�tlonal U-Ise penru,t
Case No: CU 24-07
CU 24-07 Vireo Health
Applicant's Narrative
This Conditional Use Permit application seeks to update the previously issued CUP: #CU24-000003, project:
#24-000206, such that the property lessee, Vireo Health, now intends to remodel the entire structure. The
previous application indicated that a portion of the structure would be renovated. This request remains
compliant with the City of Elk River's designated zones for cannabis production as well as the City's
Comprehensive Plan. The details of this project remain the same as in the previously submitted narrative with
the exception of the updated square footage to be remodel being revised to 138,000 SF. Please see the
attached building schematics for the design plan.
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CITY OF ELK RIVER
SHERBURNE COUNTY
CONDITIONAL USE PERMIT
Case No. CU 24-07
Permit. Subject to the terms and conditions set forth herein, the City of Elk River hereby grants a
Conditional Use Permit ("Permit") requested by Vireo Health for the following use:
Conditional Use Permit for a Commercial Cannabis Cultivation facility at 10700 165,h Avenue NW
Property. The Permit is for the following described property ("Subject Property") in the City of Elk River,
Sherburne County, Minnesota:
The Southwest Quarter of the Southeast Quarter of Section 11, Township 32, Range 26, except the
South 468 feet of the West 495 feet thereof, according to the United States Government Survey
thereof, Sherburne County, Minnesota.
Owner. Owner of the Subject Property at time of the approval of the Permit:
DM Real Estate, LLC, owner
Conditions. The Permit is issued subject to the following conditions to satisfy the standards set forth in
Section 30-654:
1. The facility must comply with all licensing and operating procedures required under
Minnesota Statutes Chapter 342.
2. The Conditional Use Permit may be issued prior to the applicant having received all
necessary state permits and licenses, but the applicant shall submit proof of obtaining all
state permits prior beginning cultivation operations.
3. Issuance of this CUP does not exempt the applicant from all standards outlined in state
statute.
4. The operation/building must connect to city sewer and water and pay the required
SAC/WAC fees in accordance with city codes.
5. Construction activities will require signed plans prepared by a qualified professional.
6. All other uses of the property must cease prior to issuance of a certificate of occupancy.
Page 157 of 372
Termination of Permit. The Permit shall remain in effect only for so long as the conditions set for the herein
are complied with. The City may revoke the Permit following a public hearing for violation of the terms and/or
conditions set forth in the Permit.
Lapse. If within two (2) years of the issuance of the Permit the proposed work described in a conditional use
permit has not been substantially completed, the permit shall expire and become void, except that the council
may, following recommendation of the planning commission, extend the permit for an additional period
determined by the council on the receipt of a request for a permit extension prior to its expiration. A conditional
use permit authorizes only the use specified in the permit and shall expire if, for any reason, the authorized use
ceases for more than six (6) months.
Criminal Penalty. Both the owner and any occupant of the Subject Property are responsible for compliance
with the permit. Violation of the terms of the Permit is a criminal misdemeanor.
Recording. The Permit shall be recorded against the title to Subject Property.
Dated: June 17, 2024
CITY OF ELK RIVER
By:
By:
STATE OF MINNESOTA )
) ss.
COUNTY OF SHERBURNE )
Mayor John J. Dietz
City Clerk Tina Allard
The foregoing instrument was acknowledged before me this day of ,
2024, by John J. Dietz and Tina Allard, respectively, the Mayor and City Clerk of the City of Elk River, a
Minnesota municipal corporation, on behalf of the corporation and pursuant to the authority granted by the
City Council.
Notary Public
DRAFTED BY:
City of Elk River
13065 Orono Parkway NW
Elk River, MN 55330
Phone: 763-635-1032
Page 158 of 372
Vireo Health
Conditional Use Permit
Vireo Health Cannabis Cultivation Case No: 24-07
City of
Conditional Use Permit PageeJ ="
Background
■ Update to previous CUP (CU 24-03)
■ Proposes expand upon previously approved commercial
cannabis cultivation facility.
■ CUP in the 1-1 zoning district.
■ Remodel the former GRE facility on 165t" Ave
■ Expand use to entirety of the 138,000 SF building.
■ Office, storage, processing, shipping, and cultivation.
■ Cultivation (growing) will take place in sealed rooms.
■ Individually climate controlled.
■ 80+ employees on two shifts between 5:00 a.m. and
12:00 a.m.
Elk
River
Page 161 of 372
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Operation
■ Utilities
■ Required to connect to sewer and water
■ Working closely with ERMU for power needs
■ Must be licensed by the state prior to beginning grow
operations — state rules dictate most of the operation.
■ Commercial licenses expected early 2025
■ Cultivation rooms should limit odor
■ Room within a room
■ Generally, operates as a light manufacturer with
shipments going in and out
■ Less traffic than previous operation.
Page 164 of 372
Planning Commission
■ No one provided comments during the public hearing.
■ PC unanimously recommended approval with conditions
noted in memo.
■ After the meeting, staff spoke with a nearby property
owner regarding concerns with odor and asked for more
information.
■ The applicant provided additional information
regarding the building and HVAC design and how
that minimizes odor.
■ He is also available for questions.
Iwo --
Page 165 of 372
Action Requested
■ Recommend, by motion, approval of the CUP with the
conditions outlined in the memo.
Page 166 of 372