Businessman wants to grow medical marijuana in Fayetteville
Posted: April 21, 2017 at 1 a.m.
FAYETTEVILLE -- A businessman from Central Arkansas wants to grow medical marijuana in the city's Commerce District.
The City Council on May 2 will consider selling 5 acres in south Fayetteville for $75,000 to Brian Faught, executive vice president of telecommunications company Adcomm. Faught intends to develop the property under his new company, AR-Canna LLC, according to city documents.
To read the rules and regulations on medical marijuana in Arkansas, go to:
Plans call for a 30,000-square-foot cultivation and processing plant and 5,000-square-foot office building. Faught anticipates hiring 35 to 40 hourly employers with a starting wage of $15 per hour, three to five managerial employees with a $50,000 to $70,000 salary and two senior managers making $75,000 to $125,000 per year, Faught stated in a letter to the city.
AR-Canna will use a Fayetteville architecture firm for the plans and construction drawings of both buildings and hire a local contractor to oversee the buildout, according to Faught, who is from Jacksonville. The 5-acre footprint will allow room to build a second or third cultivation facility as the industry matures.
The land sale hinges upon AR-Canna getting a cultivation license from the state. If it doesn't get the license, the money will be returned, city documents stipulate.
Faught, 57, said Thursday medical marijuana will be a huge industry in Arkansas and he wants to be a part of it. He first got the idea when the Arkansas Medical Marijuana Act failed by a slim margin in 2012, he said.
"We've been working on this for well over a year already and we are leaving no stone unturned," Faught said.
Faught plans to have a 70 percent stake in the business while his Florida business partner, Jeff Davis, will have 20 percent ownership and their Arkansas attorney will claim 10 percent.
Faught said his success in telecommunications sales and installation has made it possible to have the money required to get AR-Canna off the ground. He has no plans to seek investors and anticipates having a substantial revenue three years into the business' operation. Medical marijuana manufacturers typically can't get bank loans because the drug is considered an illegal substance by the federal government.
AR-Canna's products would run the gamut of allowed cannabis-based material and help supply all of the eventual dispensaries in the state. Faught also has plans to create a dispensary in Fayetteville as a separate business called Ozark Mountain Dispensary.
Faught said he has hired outside companies to guide him through the application process and in cultivation. As soon as he gets his license he will move to Fayetteville and commit full-time to the operation, Faught said.
Residents may have an unfavorable reaction to to the medical marijuana business, which Faught said is understandable. The facility will have tight security 24 hours a day, he said.
"This is actually going to help the drug problem in areas because people are now having to go on the black market and buy cannabis from drug dealers," Faught said. "Now, they're going to be able to go to their doctor for their Crohn's disease or cancer symptoms or PTSD or a host of other legitimate illnesses and get a prescription, go into a very secure, well-managed professional pharmaceutical business and get the medicine they need."
Arkansas voters approved the Arkansas Medical Marijuana Amendment 53 percent to 47 percent in November. The state Medical Marijuana Commission established rules to grant licenses to dispensaries and cultivation facilities based on the merit of their applications. The commission divided the state into eight zones with four dispensaries possible apiece. The five cultivation facilities allowed don't have to be spread out.
Applications for cultivation facilities cost $15,000. Unsuccessful applicants will get $7,500 back.
Applicants must provide proof of assets or a surety bond of $1 million and proof of at least $500,000 in liquid assets. Successful applicants will have to pay an annual $100,000 licensing fee and submit an initial $500,000 performance bond.
The application period will open July 1. Lawmakers still have to review and approve the commission's rules. The amendment requires 60 percent of a facility's owners be from Arkansas but doesn't specify what share of the business' ownership Arkansans must hold.
The commission, which issues the permits for cultivators and dispensers, serves as one of three state agencies involved in implementing the medical marijuana amendment voters approved. Alcoholic Beverage Control will inspect the facilities. The Department of Health will issue registry cards to patients whose doctors have recommended the drug.
Bud Roberts, director of the Alcoholic Beverage Commission, said it's impossible to know how many aspiring business owners will apply in July, but judging by the attendance of meetings related to the topic, there's a lot of interest.
"This came together neatly and deliberately and with quite a bit of discussion, analysis and debate," he said. "Not a bit of this was just thrown together."
Mayor Lioneld Jordan said AR-Canna appears to align with goals of the city's economic development plan, providing a source of good-paying jobs and clean manufacturing.
"It was passed by the people in the last election and it's a business," he said. "We welcome businesses, and to me, this is just a business coming here."
NW News on 04/21/2017