The municipal saga of the Blythe Have A Heart LLC (HAH 1 LLC) would-be cannabis dispensary reached another low point on Sept. 8, as officials expressed further frustrations on the project following a no-show by the provisionally awarded licensee.
As previously reported, in accordance to the Blythe City Council’s Aug. 25 direction for staff to prepare an according agreement memorializing the terms, Have A Heart was granted a six-month extension with stipulations – including a $25,000 deposit being submitted for staff time (originally recommended at $10,000) and providing a monthly update report on the project.
Queried by Councilmember Joe Halby during the item’s discussion, neither had occurred at the time of the Sept. 8 meeting – nor were any renewed building permits pulled for the site.
City of Blythe Fire Marshal/Chief Building Inspector Jason Brown also confirmed no contact (“nothing”) had been made when asked by Councilmember Joey DeConinck.
“(Have A Heart) LLC applied for a commercial cannabis dispensary license in November 2017. At that time, 8 applications were submitted for the two available dispensary licenses. A dispensary license was awarded to (Have A Heart) by the City Council on March 13, 2018. The license was issued with the provision that a Certificate of Occupancy be obtained before the cannabis license would be issued for the business,” stated the Aug. 25 staff report. “On Aug. 11, 2020, (the Blythe City) Council held a public hearing to determine if the provisional license issued to Have A Heart should be revoked. At the meeting, the owner of the project Mr. Ryan Kunkel assured staff he was ready to continue the project. He estimated 3-6 months to complete the buildout.”
Staff recommendation to revoke the provisionally awarded dispensary-category license – one of only two approved to conduct according business in Blythe – was originally submitted for city council consideration at the Aug. 11 meeting.
The Blythe Have A Heart location’s noted failure to obtain the certificate of occupancy for 1894 E. Hobsonway over the span of two years – as well as a lack of communication by Kunkel and the vagrant-frequented property previously left strewn with garbage – found officials discussing the revocation of the conditionally awarded commercial cannabis dispensary-category license on Aug. 11.
Halby has repeatedly underlined officials’ frustrations with respect to the lack of communication from Kunkel.
“The fact that you have not reached out – I, personally, tried to reach out to you on Instagram about a year ago. No response,” stated Halby to Kunkel on Aug. 11. “The fact that you’ve just not communicated to the city whatsoever is unacceptable. Excuses or not, it’s just unacceptable. The fact that you didn’t call or update us – nothing.”
Again, during the Aug. 25 discussion, Halby also emphasized the importance of transparency to Kunkel on the Have A Heart project and its ownership.
“We just want to be on the up-and-up Mr. Kunkel, that’s it. We want this done; I don’t know if I can speak for the rest of these guys, but I’m tired of people coming up and asking me about it. And it’s on the daily,” said Halby. “I’m just tired of it; I really am. I’m just tired. Tired of hearing about it. I just want it done and open. And I want you to own it; I don’t want you to flip it. I want Ryan Kunkel to own Have A Heart in Blythe, and that’s what I want to see.”
On Sept. 8, Halby was the first to comment following Blythe Interim City Manager’s item presentation noting there were no updates to report.
“What are they doing? That’s crazy. We should pull it. (...) Put that on the record, too, I said that we should pull it,” said Halby of Blythe Have A Heart’s Sept. 8 no-show. “It’s just nonsense; it’s just games.”
Public comment previously submitted by Tiffany Carrari, attorney for local cannabis business owner Travis Pollock of Flora, pointedly questioned Kunkel’s sincerity and intentions.
“City Council is well aware that Mr. Pollock’s interest in this matter stems, in part, from his company’s original bid as one of the 8 applicants for a commercial cannabis dispensary license in late 2017. However, Mr. Pollock is also a local business owner and his interest also extends from the fact that he is a currently operating, local commercial cannabis manufacturer and distributor in the City,” stated Carrari, whose correspondence – including a 43-page purchase agreement – was submitted to officials. “Furthermore, the Staff Report states that legal counsel for Have a Heart assured City staff back in May that no ownership interests in Have a Heart had been transferred. And while the technical reality of that statement might be true, it is misleading. In actuality, the whole truth seems to be that Kunkel has assigned 100% of his interests in Have a Heart Blythe to Core Competencies LLC, which is a wholly owned subsidiary of Interurban Capital Group, Inc. (‘ICG’), who together with Core Competencies LLC is listed as a ‘Seller’ in the Purchase Agreement with ‘High Times’ attached as Exhibit A. While the details of the Purchase Agreement are somewhat complicated, City Council should be aware that the agreement specifically lists the Blythe Have a Heart retail cannabis dispensary as one for which transfers of equity and rights will be made. Basically, the reason Have a Heart’s legal counsel stated that ‘no ownership interests have been transferred’ is because Mr. Kunkel’s assignment of his interest in Have a Heart is contingent upon regulatory approvals. That being said, it appears that Mr. Kunkel’s contingent assignment has been bought and paid for at least twice now, first to Core Competencies owned by ICG and then to High Times.”
Since the Aug. 11 meeting, the City of Blythe stated Kunkel has provided staff with State Cannabis Licensing information noting him as the controlling manager of the location; an Aug. 22, 2019, Secretary of State filing for HAH 1 LLC listing him as “Manager/Member of the LLC;” and the HAH 1 LLC Limited Liability Company Agreement – “seemingly” establishing ownership.
“These documents have been reviewed by staff and the City Attorney and seem to fulfill the request to show the ownership interest in the provisional Dispensary Licenses issued to Have A Heart for 1894 E. Hobsonway,” stated the Aug. 25 staff report.
DeConinck also echoed the need for communication on the project throughout the process to Kunkel.
“My only thing with this is, if we move forward with this, I want – if anything comes up, any roadblock, I want to know immediately. Not a month from now, (not) two weeks from now,” said DeConinck on Aug. 25. “We’re tired of this. So, that’s all I’ve got to say – anything. If you have a flat tire (coming here,) we want to know about it.”
Further, DeConinck has also summed up sentiment on development project delays, and the need for substantive guarantees to the city, by iterating: “Money talks and bullshit walks.”
Communication for public comment submitted by Ben King – a former employee of Have A Heart under Kunkel and now a 9th Circuit Public Defender in Florida – was read into the record by Crecelius on Aug. 25.
“The (Have A Heart) owners hoped to obtain more licenses to increase the company’s valuation and be able to sell it for an inflated price to the highest bidder. They applied for operational licenses anywhere they could, even if they did not actually have the capital, infrastructure, or connections to open a dispensary. They would apply for licenses anywhere feasible and put little thought or effort into the towns, cities, and locals where they thought they could win a license. Before ‘Have A Heart’ would apply for licenses, they obtain the applications of their competitors and would cut and paste together the best of what they could. They would promise anything they could to increase their scores. The company offered things they had no intention providing, such as reimbursing college tuition, hosting fundraisers for local charities, and even paying local homeless to clean-up neighborhood streets,” stated King. “I hold them no personal ill will, but I do not think their owners have earned the right to open any new stores or make any more money off of the legal-cannabis con-game they have been playing. (Have A Heart) wove a tangled mess of misrepresentations and false promises on a path to riches. (Have A Heart’s) shiny image hides the rotten core at the center of the company. They say Have A Heart and everything associated was purchased by Harvest Health & Recreation but no one – not even Harvest or Ryan Kunkel – can agree as to exactly what Harvest purchased. Whoever the owners actually are, do not allow them the opportunity to continue the scam being perpetuated. Don’t allow them to pull the wool over your eyes. Ryan Kunkle and Have A Heart sold the town of Blythe a bunch of snake oil. Over the time they’ve had their license, they have shown no good faith effort to obtain a certificate of occupancy. (Have A Heart) considered the Blythe location a giant black hole for money and believed the only good thing about it was the proximity to Arizona.”
Queried by Halby, Kunkel’s response to King’s Aug. 25 statements characterized the attorney as a spurned former employee.
“Mr. King was an an employee that worked for Have A Heart. We’ve had thousands of employees over 10 years. I think he worked for the company for a few months and was laid off due to poor performance,” said Kunkel. “He’s had a vendetta because he never got a severance. He made a big call to action yesterday on Facebook that he would slander me – and that’s what he did, so.”
The Sept. 8 three-and-a-half minute long report was a receive and file item, with council providing according direction to staff.
“They’ll need to have done something by Sept. 24,” stated Crecelius. “If (Kunkel) hasn’t paid the $25,000 deposit and renewed his (building) permit by then, I will notice the public hearing to revoke his permit for the Oct. 13 meeting.”
Of the eight original 2017 applicants vetted in Blythe’s historic commercial cannabis dispensary category licensing process, six were eligible. Of the six, Have A Heart had the highest aggregate score (89.57%) of Blythe’s four-phase process.
As of 7:45 a.m. Sept. 14, Kunkel has not submitted a $25,000 deposit, renewed building permit(s), nor provided any updates regarding the CalTrans permit to the City of Blythe.
(Note: Due to COVID-19 and public health concerns, the Times will continue to livestream the Blythe City Council’s regular monthly meetings online at our official social media page: facebook.com/blythenews)