NatureSweet CEO Rodolfo Spielmann told Phoenix New Times that the Texas-based company has lost millions of dollars in each of the eight years it has owned the 479-acre site about 10 miles south of Fort Grant. It's costly to maintain the acres of greenhouses that cover more than half the property and aren't fully used, but the company has tried to make it work, in part to keep the jobs there, he said.
"Thankfully, we have been able to invest — or lose — those tens of millions of dollars in the facility because the company, NatureSweet, is very strong," Spielmann said. "But there's a moment that we cannot keep doing that. That was my decision of 'Okay, we need to look for a different option.'"
The company found that option in Bayacan, a company that hopes to purchase one of the sites in the facility to cultivate cannabis. Neither side will disclose the cost of the purchase, but Spielmann said the combination of the cash infusion from the sale and splitting utility costs for the facility will allow them to move forward with turning the rest of the greenhouses into a research facility and making the site affordable.
The plan stalled when Bayacan hit a roadblock specifically designed to complicate marijuana cultivation efforts in the southeastern county, one of only three in the state to vote against last year's legalization proposition. In Graham County, pot growers need to acquire M-X zoning, a designation reserved for oil refineries, hog farms, and other noxious businesses. Board of Supervisors Chairman Danny Smith said this was a conscious choice by board members years ago to ensure such projects received extra scrutiny.
That extra scrutiny came in the form of neighbors and other community members who denounced Bayacan's zoning application to the planning commission and board of supervisors last December. The county did not provide a requested recording of the meeting to New Times before publication, but minutes show that speakers cited concerns about air quality, traffic, and marijuana's impact on youth. The Gila Herald reported that a local substance abuse group head claimed that Arizona companies were growing 73 percent THC plants, which don't actually exist.
After the planning commission voted to recommend against approving the zoning change, Bayacan's attorney Heather Dukes withdrew the proposal before it faced likely defeat by the board of supervisors.
Since then, Dukes and NatureSweet have tried reaching out to residents more directly and bringing in executives to meet with the community. This has had mixed results. In March, NatureSweet Executive Chairman Bryant Ambelang said at a community meeting that unless the deal goes through, NatureSweet would shut down its facility, removing nearly three-quarters of the property tax revenue that the local Bonita Elementary School District school relies on, the Eastern Arizona Courier reported.
The school district's superintendent fired back, telling the Courier in an email that the district had been advised that any losses would be covered by state funding.
Dukes said this is based on a misunderstanding of the company's position and that state funding would only cover a portion of the potential losses. But there's another group at stake in all this: the nearly 200 workers at the NatureSweet facility who stand to lose year-round union jobs.
NatureSweet informed its Graham County workers on Friday that unless the deal goes through, this July will mark the end of the facility's growing cycle. The company plans to pay out severance to the workers that will factor in their time at the site, including under its previous owners, and will offer a few months of work to break down the operation.
Asked why the company can't hang on another year to see if a deal can be made before laying off the workers, Spielmann said there had been a breakdown of communication with the neighbors and he couldn't see a path forward.
"If we would know exactly what is needed ... We would absolutely do it. But the point is, we don't really understand what's going on," he said. "Because there's no communication, the communication only happens in the media. And again, we are trying to connect, but we're not getting an answer."
Neighbors aren't quick to talk about the situation. Several did not respond to repeated calls and emails from New Times. One, reached through a number posted on a farm equipment sales website, declined to talk on the record.
“I don’t want to say nothing you’re going to print,” he said.
John Smith, a Tucson attorney who owns a neighboring vineyard, said that he believes the proposal would be of general benefit to the area due to the hundreds of jobs it would create, but he supports the will of his neighbors because he doesn't live in the area.
County Supervisor Danny Smith, who represents the area, is taking a similarly hands-off approach and said he's deferring to his constituents while trying to facilitate conversations between both sides.
“I often tell people my job is to encourage adults to talk to each other,” he said.
He said neighbors feel like they're being strong-armed and rushed by NatureSweet. He said more outreach could have been conducted initially and complained that a previous press release that the company published about the planned shutdown was counterproductive. Smith said he doesn't quite buy NatureSweet's warnings about lost tax revenue. He thinks something will be worked out.
“The biggest indication to me about who’s concerned ... and not concerned about it is the Bonita school board, who’s willing to say no,” he said.
A study commissioned by NatureSweet found that if the greenhouse complex were donated to a public university, a move the company is prepared to take, the elementary school district would lose $467,000, or around one-quarter of its total budget — even after the state provides additional funding.
Members of the district's board did not respond to repeated calls and emails. New Times reached the son of board president Kolin Kramme at the family construction business, who said to call back Tuesday evening, but then did not answer a call then or further messages.
“I’ll tell you the Bonita school district is reluctant to take money from growing recreational marijuana for the school," Danny Smith said. "It’s hard to have a drug prevention [or a] drug intervention program in the schools if they have to end every message with, 'Unless of course, you can make money on it.'"
Dukes said the plan is to grow medical-grade marijuana to capitalize on high demand for it, and she pointed out that no sales would happen at the site. Her recent efforts have involved informing community members about the state regulations that govern marijuana grows. Her focus has been on the 600 good-paying jobs Bayacan says it will eventually create at the site, and the potential loss that will occur otherwise.
“It’s cannabis. That’s really what is going to save this whole greenhouse facility," she said.
There may be other factors affecting the school board's decision-making. One of the other three members, Wende Macumber, co-owns a horse farm directly adjacent to the greenhouse. She didn't respond to calls and messages from New Times, but the Gila Herald reports she told the board of supervisors that the project would reduce the farm's property values and "destroy their business."
Kris McBride, a spokesperson for Eastern Arizona College, a local community college that would lose $300,000 if the property no longer provides tax revenue, said that institution could adjust to the loss, but it would "have an impact."
“And so we’re basically wanting all the parties to come together and find a positive solution,” he said.
They'll have to do that soon. Bayacan attorney Dukes says that the decision on whether to resubmit the zoning change will be made by the end of the month and depends on the success of a planned community meeting next week.
She and NatureSweet acknowledge they could have done more outreach earlier, but they deny that they're strong-arming the locals. Spielmann said they're just sharing the reality of the situation and jobs are on the line, even if neighbors' feelings are hurt.
"Again, it's not about feelings. We're being honest," he said. "It's hard to understand, how can you misconstrue being honest?"