6A • March 9, 2018 | Cannon Beach Gazette | cannonbeachgazette.com
Planning Commission says no to industry suggestions
Commissioners
question efficacy of
proposed changes
By R.J. Marx
Cannon Beach Gazette
CITY OF CANNON BEACH
Housing stock in Cannon Beach as
presented by the Cannon Beach Af-
fordable Housing Task Force.
Members of the Cannon Beach
Planning Commission recognize the
city needs workforce housing. But
zoning amendments brought before
them Feb. 27 are not the way to do it,
they decided.
The commission recommended
the City Council reject the changes
intended to reduce barriers for pri-
vate developers seeking to build af-
fordable housing.
The amendments were intended
to meet housing needs by reducing
construction costs and subsequently
reducing rental costs to tenants, wrote
Martin North Vice President of Oper-
ations Dave Norstedt in January.
Mike Clark, owner of Coaster
Properties, with former city planner
Rainmar Bartl, proposed to amend
parts of the code.
Amendments focused on reducing
parking requirements to maximize
the number of units on a property
and increasing height restrictions in
the R3 zone, which is designated for
multifamily housing.
By raising the roof-line limit from
28 feet to 32 feet, developers could
build three stories to include more
units, intended to drive down rents
for tenants.
Reduced landscaping area re-
spaces harder to find, he added.
“Lowering the parking in the units
downtown where there’s already a
premium for parking, lowering those
standards doesn’t make any sense.”
Commission Chairman Bob
Lundy said statutes should stand
as written, with variances to create
workforce housing considered on a
case-by-case basis.
The commissioners recommend-
ed rejection of all amendments by a
7-0 vote.
“We’re looking for another al-
ternative to this,” Kerr said after the
meeting. “It’s not just a blanket ‘no
way.’ I just don’t see any outside
controls on this. Outside developers
coming in and charging $1,600 for
an apartment — that’s not affordable
housing anymore.”
quirements and changes to condo-
minium conversion rules for multi-
family dwellings were also among
proposals.
“To me there’s nothing in this that
would assure this would be afford-
able housing,” Commissioner Lisa
Kerr said. “The proponents are all
people involved in development and
commercial endeavors. That’s fine
— but the way it’s written here is a
disaster waiting to happen. I don’t
think how any of this could lead to
affordable housing.”
Commissioner Darryl Johnson
objected to proposed roof-height
changes. “Moving the height to 32
feet reminds me of going to Sea-
side,” he said. “We have a different
feel in the city.”
Parking changes could make
Cannon Beach explores ways to redirect tourism money
Tax from Page 1A
The Astoria City Council
voted last year to increase the
lodging tax from 9 percent to
11 percent, with the intent to
use some of the money for
maintenance at city parks
known to have heavy tourist
traffic. Bend voted to reduce
the percentage of lodging
tax designated for tourism
promotion in order to pay
for road repairs, a move that
is being legally challenged
by the Oregon Restaurant &
Lodging Association as a vi-
olation of state law.
Opponents say lifting re-
strictions on the tax money ul-
timately defeats the purpose,
which is to promote tourism
that generates revenue for cit-
ies in the long term.
In Cannon Beach, Greg
Swedenborg, the president of
the chamber’s board, said the
chamber is open to the idea
but needs more specifics.
“I think it addresses an area
that Cannon Beach has a need
for. But it’s not just buying the
school. You have to consider
operating costs before you
can make a decision,” Swe-
denborg said. “Whether it’s
used for the arts or as a con-
ference center, sure, we could
use that. But will it benefit
year-round business? Is it do-
ing what the intent of the law
is, which is making it a place
that regenerates that transient
lodging tax?”
‘Loved to death’
A state law passed in 2003
imposed a 1 percent lodging
tax increase, with 70 percent
of the revenue collected re-
stricted to tourism promotion
and tourism-related facilities.
As a fundraising mecha-
nism, the law has done its job.
The Oregon Department of
Revenue collected more than
destination that’s no longer a
destination because it’s been
loved to death?”
Return on investment
COLIN MURPHEY/EO MEDIA GROUP
Cannon Beach city councilors might turn the former ele-
mentary school into an event center.
$145 million in revenue as of
2015. Cannon Beach in 2016
alone received $3.8 million in
lodging tax revenue.
But Wendy Johnson, an in-
tergovernmental relations as-
sociate with the League of Or-
egon Cities, said some cities
are having a hard time keep-
ing up with the demand that
tourism promotion creates.
“A lot of communities are
spending a lot on market-
ing and are getting loved to
death,” Johnson said. “Cit-
ies rely on tourism for their
economy and they want to be
a welcoming place. But they
also have a strapped budget,
and they want more flexibili-
ty to use those revenues. This
law is one size fits all, and ev-
ery city has different expendi-
tures and needs.”
A survey done by the
league asked 46 cities how
each would prefer to spend
lodging tax revenue. John-
son said the top responses
were city beautification, pub-
lic safety and transportation
improvements — all issues
related to a booming tourism
industry.
“We just disagree with
what tourism-related means,”
Johnson said. “You don’t have
a good event if you have a
traffic jam or not enough cops
to keep it safe. They won’t
come back.”
In the last legislative ses-
sion, Johnson said she pushed
to broaden what can be con-
sidered a tourism facility,
which is defined as a confer-
ence center, convention cen-
ter, visitor information center
or other property with the sub-
stantial purpose of supporting
tourism.
“Right now the law says
it has to be real property, and
has to have a use of 10 years.
So maybe you can’t cover
flowers, but maybe you could
fix a light post,” she said. “We
think it should help with beau-
tification issues, but the defi-
nition is too narrow. We think
it should include anything that
makes the experience better
for the tourist.”
The proposal didn’t make
it out of committee in Sa-
lem. Johnson said she hopes
to continue working with the
lodging industry to find a
solution.
“The growth in Oregon has
been great,” she said. “But
at what point do you have a
Jason Brandt, CEO of the
Oregon Restaurant & Lodg-
ing Association, argues a city
already can use 30 percent of
the lodging tax on general city
needs, and that public infra-
structure isn’t a reliable metric
to help define tourism-related
facilities.
Redirecting the tax money
to capital projects or main-
tenance takes away from the
“big picture” of what it takes to
support Oregon’s second-larg-
est industry, Brandt said.
“The reality is, whenever
we don’t put that dollar out for
promotion, and instead for a
local investment for a capital
improvement, in a way we are
shooting ourselves in a foot,”
Brandt said. “We are using a
long-term investment strategy
for a short-term challenge a
community may be facing.”
That investment, Brandt
said, is supported by a report
from Longwoods Internation-
al, which shows for every $1
invested in tourism promotion,
$237 is generated in economic
impact and $11 in tax revenue
to the benefit of Oregon resi-
dents.
The concept of “how much
tourism is too much tourism”
looks different for each com-
munity and should be solved
on a local level, Brandt said.
But investing in tourism
over time is a greater benefit to
city’s general fund, he said.
“I can’t emphasize how
strong the tourism economy
can be if we focus on tourism
promotion and less on mainte-
nance backlogs,” he said.
In Cannon Beach, since the
Chamber of Commerce has
been the recipient of 70 per-
fore the contract the city would
see maybe 4 percent or 6 per-
cent growth. When we started
you are seeing around 16 per-
cent or 10 percent increases (in
the lodging tax revenue). We
think we have something to do
with that.”
cent of the lodging tax dollars,
the amount of taxes paid to the
city has increased by double
digits almost every quarter.
“We can’t claim it all,”
Swedenborg said. “Good
weather, good economy goes
into growth, as well. But be-
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Council revisits marijuana zoning ordinance
Pot from Page 1A
they are technically in a com-
mercial zone,” McCarthy said.
Councilor George Vetter
took issue with isolating a par-
ticular industry. He also was
concerned that keeping this
section of the ordinance could
lead to a similar unintended
consequence as the mixed-
use building question, where
property owners would opt to
convert what otherwise would
be some form of housing into a
solely commercial enterprise.
“If someone paid commer-
cial value for this property, are
taking away that value?” Vetter
asked. “This could end up back-
firing like the original problem
we were trying to solve.”
Before revisiting the is-
sue in April, City Planner
Mark Barnes and City Attor-
ney Tammy Herdener plan to
evaluate the questions raised
by councilors, like a clearer
definition of what constitutes
a mixed-use building.
“You raised good ques-
tions. When can a building
turn into a mixed-use build-
ing? We want to look at this
more closely,” Herdener said.
“I don’t want to go down an-
other slippery slope.”
Glut in Oregon marijuana supply, prices ‘plummeting’
Clatsop County
sold $8 million
in pot products
last year
By Edward Stratton
The Daily Astorian
With their lower populations
and higher rates of tourism,
North Coast counties sold some
of the most marijuana per capita
in Oregon last year.
The 14 licensed marijuana
retailers in Clatsop County sold
more than $8 million in products
last year, part of the nearly $520
million sold statewide. The in-
dustry has grown to employ
more than 12,000 people, while
the state has raked in more than
$100 million in tax revenue.
There were six marijuana
retailers in Astoria, four in Sea-
side, one in Cannon Beach, two
along U.S. Highway 26 and one
in Westport — more than 1 for
every 2,800 people. Combined
sales equaled $208 per person,
the sixth-highest rate in the state
during the first full year of rec-
reational sales regulated by the
Oregon Liquor Control Com-
mission.
Tillamook County ranked
fifth, selling $5.6 million in
marijuana products, equal to
$214 per person. Lincoln Coun-
ty came in third, at $13.6 mil-
lion, $284 per person.
Stephanie Schlip, who man-
ages Oasis Cannabis locations
in Newberg, Monmouth and
Seaside, said her sales on the
Oregon Coast will often outstrip
those in the Willamette Valley
by 25 percent in the summer
and lag behind in winter.
“I would say about 1 out of
every 20 customers say they’re
from another state, and they’ve
never been in a dispensary,” she
said.
Many were Californians
before that state recently le-
galized recreational sales, she
said, Many were from Idaho,
the only state bordering Ore-
gon where recreational mari-
juana is illegal.
Curry County, on the border
with California, ranked second
in sales per capita, selling $310
worth of marijuana per per-
son. Rural Baker County, with
16,750 residents and across the
border from more than 600,000
people in Idaho’s Treasure Val-
ley, sold $16 million worth of
marijuana last year, or $960
per person. Multnomah County
sold $176 million in marijuana
products last year, or $220 per
person, the fourth-highest rate
statewide.
“I think it’s just the begin-
ning,” said Don Morse, director
of the Oregon Cannabis Busi-
ness Council, a trade associa-
tion. “I think sales are going to
increase, and they’ll certainly
get a lot higher as we take away
from the black market.”
But Morse and others see
consolidation coming among
the more than 500 retailers and
900 growers statewide.
A presentation by New
Frontier Data economist Beau
Whitney noted the industry was
reaching saturation. Retailers
need about $125,000 in month-
ly sales to be viable, but are av-
eraging $92,000 a month in Or-
egon, leaving them in distress.
Part of the issue is too much
marijuana being produced. The
estimated maximum canopy
being used by growers has gone
from less than 10 million square
feet in 2015 to more than 20 mil-
lion square feet, Whitney said.
Between October 2016, when
recreational sales started, and
November, the retail price of
a pound of marijuana dropped
from $4,440 to less than $3,000.
“It’s no surprise to me that
there’s excess supply, or that
prices are plummeting,” Whit-
ney said, adding many growers
are trying to get bought out.
Whitney has suggested re-
tailers lower their prices to take
price-conscious
consumers
away from the black market.
“In general, for every 1
percent or so reduction in
price … you’ll increase your
demand by 2 to 3 percent,” he
said. “That’s conversion over
from the illicit market.”
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