ADRIAN — After further scrutiny of its marijuana ordinance, it appears there is an outlet available for the city to allow for the sale of recreational marijuana without expanding the number of permits.

City attorney Tamaris Henagan notified the Adrian City Commission at Monday’s premeeting that language in the city’s marijuana ordinance only limits the number of permits for provisioning centers, or dispensaries, in the B1 and B2 zoning districts. That number is 10.

The city had been under the understanding it would need to develop a competitive process as the Michigan Regulation and Taxation of Marihuana Act requires such a process if a municipality intends to limit the number of permits it will issue.

However, an interpretation of the ordinance from commissioner Brad Watson, and what Henagan called “a brilliant light bulb idea,” has the city under the impression that the limit of 10 permits is only for those two zoning districts.

The particular ordinance section reads, “… total of ten permits, single and/or dual purpose, in the B-1 and B-2 districts combined, unlimited in the industrial overlay district.”

The city had briefly considered expanding the number of available permits to 12 as 10 permits, all for medicinal marijuana, have been awarded in a non-competitive way. Four dispensaries in Amazing Budz, North Coast Provisions, Gage and Highwire Farms are already in business.

Henagan told the commission it is her understanding that permits for all types of marijuana facilities, dispensaries, cultivation centers, processing centers, etc. are unlimited in the east and west overlay districts. It is only in the B1 and B2 districts where the limit exists.

State law only requires a competitive process if a municipality intends to limit the number of permits within its boundaries. In Adrian’s case, it is not limiting the number within the city, only in two specific areas.

“By restricting the number of permits in a zoning area, we are not limiting the number of establishments in our municipality,” Henagan told the commission. “Therefore, it really is that the overall number is unlimited and it always has been that way.”

The east overlay includes parcels on Beecher, Church, Dean, Erie, Gulf, Logan, East Maumee, East Michigan and Treat streets as well as Lowe, Wabash and Railroad avenues. The west overlay includes parcels on West Beecher, including the current grow facility for Fluresh.

“The vast majority of the property that has been designated as available for marijuana facilities would also be available for provisioning centers,” said Greg Elliott, community development director.

There are a few parcels on the east side that butt up against residential properties. Those are the only ones where a dispensary could not be located.

There is one stipulation with possible dispensaries in the overlay districts — a dispensary must be connected to a grow facility of the same company. For example, Fluresh could build a dispensary on its property and its permit for it would not count toward the 10 limit in B1 and B2.

Elliott said there would not be a restriction on the number of plants a company would have to grow to meet this requirement, only that it have at least a Class A grow license.

Henagan said she inquired with attorneys in the marijuana industry who told her the interpretation of the ordinance language could probably withstand a legal challenge.

“The feedback I’ve gotten is that this is a fair approach to take and that for the most part they would not see themselves challenging this,” she said.

Permits for medicinal and recreational marijuana dispensaries will be under one, dual-purpose permit, however, a company will have to apply to sell both through separate application processes.

With no need for a competitive process, Henagan suggested to the commission that it amend the city’s marijuana ordinance to better clarify what it already says, amend its zoning ordinance and take measures toward preparing for an application period for recreational marijuana permits.

Henagan suggested an application period for recreational permits beginning March 16 through April 10. The beginning date would allow the clerk’s office to handle the presidential primary election on March 10 beforehand.

The city has a moratorium in place until Feb. 28 for issuance of permits, licenses and zoning approvals for recreational marijuana. The commission will have to vote to lift it.