Did Morro Bay officials exploit pot shop permitting process?

August 22, 2019

Councilman Robert Davis, Councilwoman Dawn Addis, Mayor John Heading, Councilwoman Marlys McPherson and Councilman Jeff Heller


Morro Bay city officials inappropriately manipulated results of marijuana permit applications to reward a pair of favored groups, a lawsuit filed this week in San Luis Obispo asserts. [Cal Coast Times]

In late June, the city identified the top finalists for two available medical marijuana dispensary permits– one a Sacramento organization, RCP, the other a Helios Dayspring-owned entity, Natural Healing Center.

The complaint alleges the two apparent permit winners “were not legally eligible for a permit under the governing ordinances and applicable city rules and regulations.” The lawsuit also names two other applicants, Ethnobotanica LLC and SLO Retail Group LLC. All of the four named applicant defendants, the complaint notes, “failed to meet the required minimum (city) qualifications.”

Irvine attorney Jeff Augustini filed the action on behalf of Connected Morro Bay Blvd. LLC, noting that litigation was necessary because the city allowed no avenue of appeal to the decision.

City Manager Scott Collins

That decision became the exclusive purview of City Manager Scott Collins through a convoluted system involving committee and sub-committee recommendations and combining written applications with in-person interviews. A subcommittee consisting of the police chief, fire chief, and finance director conducted interviews and recommended two dispensaries to Collins.

The Morro Bay City Council approved the selection methodology and ordinance “the same night my contract was approved” in Nov. 2017, said Collins.

“I’m not sure if there’s a right way or a wrong way, but that’s the way our council did it,” Collins added.

Six business entities applied for the two permits, and each was ranked according to satisfaction of specific requirements. The plaintiff, Connected, ranked highest among the six, accumulating a total of 1,646 points in the system developed by a city subcontractor, HdL, of a possible 1,650 points.

That, attorney Augustini pointed out, was 236 points higher than Dayspring’s Natural Healing center, and 320 points higher than the Sacramento-based company’s total.

Following the application session, Collins made the final decision, and in the process essentially reversed the recommendation list, with Dayspring’s company moving from fifth to first.

Elliot Lewis, a principal of the Connected group, said this week that in addition to the lawsuit, a team of investigators is sifting through details of the applicant process.

Employees of Natural Healing Center and Perfect Union must still pass background checks prior to the businesses receiving their Morro Bay operating permits.

Natural Healing Center currently operates a dispensary in Grover Beach and is in the process of opening a San Luis Obispo location. It was previously reported that the permit awarded for the Grover Beach dispensary was the subject of pay-for-play allegations centered around Dayspring and a pair of public officials in the South County city.

Likewise, the city of SLO has been criticized for awarding two of its dispensary permits to major donors to the mayor and a pair of councilwomen.

Last October, Dayspring and Natural Healing Center hosted a fundraiser for eight local politicians, including three current members of the SLO City Council and now-Morro Bay Mayor John Headding and now-Councilwoman Dawn Addis.


I hope that’s a rhetorical question, otherwise I take offense at the insult to my intelligence.


A case of losers weepers?….maybe?…

Niles Q

I’d say that the City didn’t put much faith in its consultant and put much more faith in the police and fire chiefs and finance director.

How smart was it for the council to make the city manager responsible for making the final decision.

Automatic fall guy…


……and why spend all that money on a consultant if you, like Grover Beach, have no intention of heeding their advice?


Because it’s not their money to spend, it’s only taxpayers money, and if that runs short they can scare us with talk of police and fire reductions and cutting other services until we give them more.



The FBI recently announced that they are seeking any information about the corruption of local SLO public officials as it relates to the marijauna dispensary outlet decisions, and possible corruption.

Anyone in Morro Bay who has information about how the near-last place finishers ‘suddenly’ became the top picks for dispensory awards should contact the FBI field office in Santa Maria.

As for Morro Bay city councilwoman Dawn Addis, that woman will be marchng straight to federal prison!

Just saying.


Why just Ms. Addis? Why not all of them?


Hmmmmm… Good point.

Jorge Estrada

Check into Dayspring and discover who their lawyer is, then find the lawyer of other such outfits? Think about it.


Probably just a coincidence… an odd confluence of events… but Dayspring’s “local” lawyer is James Wagstaffe, the San Francisco lawyer representing Charles Tenborg in the Tenborg v. CalCoastNews libel lawsuit. Get a better picture of Wagstaffe here: