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Richmond Mayor and Sons Profiting from Cannabis Compliance Push

City officials have slowly worked to bring a massive illegal marijuana warehouse into compliance, and the mayor's family has a financial stake in its success.

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According to city emails, after the building was red-tagged, Daniel Butt became the attorney for the cannabis growers to help them work with the city. In a recent interview, Daniel Butt said that while the city attorney "took a very hardline approach" in favor of shutting the facility down, he filed an appeal. According to Butt, this allowed the grow to continue "in flux."

But Mendoza-Govan's notes suggest that the code violations needed to be rectified before allowing operations to resume.

In November, five months after the illegal cannabis grow was first discovered, six separate businesses listing their address at 1170 Hensley submitted incomplete CUP applications to the planning department. The six applicants also needed to include blueprints and design plans. That's where the mayor and planning commissioner's architectural firm appears to have entered the scene.

Owned by Tom Butt and his son Andrew, Interactive Resources was hired by Great Farm Development to draft code compliant plans for the grow facility.

On Nov. 8, 2017, a day after the planning department received the six CUP applications to legalize the cannabis grow on Hensley Street, Wang Brothers Investments contributed $2,500 to the Tom Butt's mayoral campaign committee. It also donated more than $10,000 to the city's annual July 4 celebration.

City records show that Andrew Butt communicated about the Hensley Street cannabis grow with city staff before Great Farm Development was created. In June 2017, just as reports about the facility were coming in from the city's Water Resource Recovery Department, Lina Velasco, a project manager with the planning department, emailed Andrew to inquire about whether he was working on plans related to the property.

"That's the old newspaper printing facility owned by the Wang Brothers," Andrew responded. "We had talked to them a while back about helping them come into compliance and obtain a CUP for cannabis (which I understand has been an ongoing operation there for some time). Never went anywhere."

In an interview, Andrew, the listed architect for the CUP applications, said that Wang Brothers Investments initially approached him and his brother in 2016 to work on bringing the building into compliance.

"At that time, I can't remember if they had mentioned cannabis or not," he said. "I don't recall if it was specifically mentioned. It may have been alluded to."

But the plans fell through, Andrew said, until about a year later when the city red-tagged the building and Wang Brothers Investments returned to Interactive Resources for help.

"We're doing a lot of this cannabis work. It's actually been a really good niche for us that sort of just landed on the doorstep," Andrew said. "And since then we've decided to take an active approach."

Tom Butt reported receiving at least $10,000 in payment from Great Farm Development through his architecture firm, according to his 2017 economic conflict of interest forms filed with the city.

His son, Andrew, did not disclose any payments from Great Farm Development to Interactive Resources in 2017.

Andrew Butt did not attend the March 15, 2018, planning commission meeting where the cannabis grow facility's CUPs were approved. He told the Express that he sent an email to the city recusing himself from the session due to a conflict of interest. His brother Daniel appeared at the meeting alongside Kevin Wang of Wang Brothers Investments to advocate for the project's approval.

Tom Butt said he would recuse himself if anything having to do with the Hensley Street cannabis warehouse ever came before the city council. But he added, "if it's something general that affects everybody in the city, and that business, it's not a conflict."

"There's some discretion there," he added, "but I try to do what's right and what's legal."

Hana Callaghan, a government ethics expert with the University of Santa Clara, declined to discuss the specifics of the matter surrounding the Hensley property, but said that, generally speaking, government officials have an obligation to avoid even the appearance of any personal benefit that could come from acting in their official capacity and responsibility to the government. "They have to put the public's interest before their own personal interest," Callaghan said. "They also have a duty to preserve and maintain trust in government, because without trust, government fails."

Records maintained by the California Department of Food and Agriculture show that the six businesses' applications for commercial cultivation licenses were denied in May, two months after the city's planning commission conditionally approved the CUPs.

Wang Brothers Investments has been accused of allowing an illegal cannabis grow at one of its other properties. A building inspector performing a routine compliance check last year discovered the largest indoor illegal cannabis grow ever documented in West Sacramento warehouse, owned by Wang Brothers Investments. Local police found more than 11,500 cannabis plants and 300 pounds of dried product worth $18 million, according to court records.

In January of this year, the Yolo County District Attorney obtained a court injunction against Wang Brothers Investments after a judge considered the preliminary evidence indicating that the company knowingly rented the warehouse out for the illegal cannabis grow.

The case is still open and Wang Brothers Investments denies allegations made by the Yolo County District Attorney's office that it was involved.

In a recent interview with the Express, Mayor Butt said he was unaware of Wang Brothers Investments' ongoing case in Yolo County. Butt also said he never discussed his businesses' work on helping Great Farm Development obtain city approvals to operate the Hensley grow warehouse with anyone in city government.

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