Modesto approves new home for cannabis dispensary. Why did former landlord object?
The Modesto City Council has approved the relocation of the Doctor’s Choice cannabis dispensary from a Yosemite Boulevard shopping center to the edge of a nearby residential neighborhood. The OK was given despite passionate opposition from the dispensary’s former landlord.
Raj Kumar, the former landlord, appears to have launched a two-pronged attack against the relocation.
Kumar told council members at their Tuesday meeting that the dispensary owners owed thousands of dollars in unpaid rent and caused thousands of dollars in damage to the building when they left in March. (Kumar said in a previous Bee story that his wife, Amar, owns the building and he is the property manager.)
Amar Kumar also went to court and obtained an order to evict Doctor’s Choice last year, according to the attorney who represented her.
In addition, the Jai Shriram Community and Daycare Center, which is less than 200 feet from the dispensary’s new home on Phoenix Avenue, objected to the relocation. Dispensaries cannot be within 600 feet of a day care.
Kumar focused on what he claimed Doctor’s Choice owed him, though in his remarks to the council he twice referred to the day care as his, including calling it “my day care.”
The day care is not licensed with the state, and the city claims there is no evidence it is operating. The Doctor’s Choice attorney claimed the day care was a ploy by Doctor’s Choice’s former landlord to stop the relocation.
But Kumar presented himself as the aggrieved party.
He told council members he charged Doctor’s Choice only $3,000 a month when he knew that other landlords were charging dispensaries significantly more and that another dispensary also wanted to lease the building and had offered to pay more.
“I said no,” Kumar said. “He’s from my country. I want to help him. I did help him. So what did I get? ... While he was making money, he bought that building in the Phoenix area. When he bought that building, then he has in mind he wants to move.”
Kumar and Doctor’s Choice could not reach terms on a new lease after the three-year lease ended in November 2021.
Kumar said Doctor’s Choice stopped paying rent while it was negotiating a new lease and owes several months in back rent in addition to the damage to the building. The Bal family, which owns the dispensary, has said the eviction and closure were because of the failed lease renegotiation and denied any claims of property damage.
Doctor’s Choice attorney Zach Drivon told council members the Bal family negotiated in good faith but Kumar’s term’s were exorbitant. Drivon said Kumar wanted a rent increase of ten times what the Bals had been paying, as well as a $70,000 cash deposit and annual rent increases of 10%.
Asked why city officials did not consider the eviction as part of their deliberations in allowing the relocation, city spokeswoman Diana Ruiz-Del Re said in an email: “As a city, we don’t get involved in civil matters.”
The dispensary had been at 2309 Yosemite Blvd. on the east end of a roughly one-fifth-mile long shopping center bordered by Parry Avenue to the east and Phoenix Avenue to the west.
It is moving to 121 Phoenix Ave., which is next door to the Bal family’s Phoenix Market. Drivon said the family has operated the convenience store for 22 years. Public records show Bhupinder Bal purchased both properties in August 2019.
The Jai Shriram Community and Daycare Center is at 2007 Yosemite Blvd., at the west end of the shopping center and 170 feet from the new Phoenix Avenue home for Doctor’s Choice. Dispensaries cannot be within 600 feet of a day care unless the city grants them a waiver.
But Deputy City Manager Scotty Douglass told council members a waiver would not be required for Doctor’s Choice.
He said the Jai Shriram center applied for a city business license in October 2021 and was issued one. The center sent the city a letter in June opposing the Doctor’s Choice relocation. Raj Kumar’s cell number is listed as the contact number for the center on the city’s business license database. Narinder Kumar is listed as the center’s owner on the business license and she sent the June letter.
Douglass said the city sent the Jai Shriram center a July 19 letter asking for a copy of its state day care license. He said the center replied with a copy of its application for a state license dated July 23. He said the application was pending with the state and that the city does not have any evidence the center is operating as a day care.
Center’s doors closed
A sign on the Jai Shriram center’s front door states the day care is open 7:30 a.m. to 2:30 p.m. Monday through Friday. The center was closed and it appeared dark inside when The Bee visited at 2 p.m. Wednesday and 8:30 a.m. Thursday. A call to the center was not returned.
The California Department of Social Services’ website showed the license application was pending as of Friday.
Douglass said the center also claimed it is exempt from having a state license. He said that exemption is for day cares that operate no more than 30 days a year. He said the city requirement that dispensaries be at least 600 feet from day cares applies to licensed day cares that operate on a continuous basis.
“This is a last-ditch effort by the landlord to thwart the applicant because of their lease dispute,” said Drivon, the Doctor’s Choice attorney, at the council meeting.
He said the Bal family is well-respected in the neighborhood in part because of how it operates the Phoenix Market and Doctor’s Choice. Drivon said 53 neighborhood residents signed what he called endorsements supporting the relocation.
The Bee spoke with more than a half dozen neighborhood residents who said they do not have concerns about the relocation, with a couple saying the Bal family has helped the community.
But the owner of a rental home next to Phoenix Market said he is concerned about parking and traffic from the dispensary. There are about a half dozen parking spaces in front of the dispensary’s storefront, but there is space behind the building for parking.
$5M in cannabis taxes
Modesto has eight cannabis dispensaries — including Doctor’s Choice — and three other cannabis businesses that are not dispensaries. They bring in a lot revenue to the city. Modesto projects it will receive $5 million in cannabis taxes in its current budget year, which ends June 30.
Drivon said Doctors’ Choice was generating about $35,000 a month in cannabis taxes to the city. Modesto levies an 8% tax on dispensaries’ gross revenue. Drivon also said it is the only dispensary in Modesto east of McHenry Avenue.
The Bee identified the Doctor’s Choice operator as Shan Bal in a previous story. Kumar identified Bal and the two people sitting with him at Tuesday’s meeting as his parents. They declined to give their names or comment to The Bee. They also have declined or did not respond to requests for comment this week.
Kumar told council members that he went to court against Doctor’s Choice and a judge issued an eviction. Kumar said Wednesday he would provide The Bee with the case number, but said Thursday, after speaking with his wife, he would have no further comment.
But a notice from the Sheriff’s Department posted on the front door of the former dispensary states in part: “These premises have been delivered to the real property owner or his agent in accordance with a court order/writ of possession and notice to vacate.”
Modesto attorney Larry Niermeyer confirmed Friday morning that he represented the property owner in an eviction proceeding against Doctor’s Choice last year. These cases are known as unlawful detainers. He said the request was granted.
Niermeyer was out of his office and did not have further details but his office provided the case number.
The unlawful detainer was filed Dec. 13, 2021, and granted Feb. 2, 2022, according to the Stanislaus County Superior Court’s clerk’s office in Turlock.
The clerk’s office said Amar Kumar filed the unlawful detainer against Rajwinder Bal. The clerk’s office said the judge also issued a $6,717.96 judgment against Bal and the dispensary was given until 3 p.m. March 14 to leave Kumar’s building.
Court records sealed
The clerk’s office said the case was sealed Feb. 10, 2022, under the provisions of section 1161.2 of the California Code of Civil Procedures. The section allows limited access to the records.
The City Council did grant a waiver for the relocation because the rear of the business will be within 89 feet of the backyard of a home on San Juan Drive. The city requires dispensaries be at least 100 feet from residences. Doctor’s Choice will erect an 8-foot-tall, wrought-iron fence with a locked gate in the rear of its business to serve as a barrier.
Drivon said the San Juan Avenue resident provided a letter in support of the relocation.
The council voted 5-0 to approve the relocation and grant the waiver. Mayor Sue Zwahlen recused herself. Council members cannot vote on matters involving donors who have contributed $3,000 to their campaigns in the preceding 48 months.
After the council meeting, Zwahlen said her campaign received two $2,000 contributions in 2021 from Rajwinder Kaur Bal and Bhupinder S. Bal.
This story was originally published October 28, 2022 at 11:15 AM.
