WOONSOCKET, R.I. (WPRI) – One of the marijuana dispensaries awarded a license in a public lottery last year has been denied a special use permit to open up in Woonsocket, raising doubts about yet another of the six new dispensary licenses approved by lawmakers three years ago.

Two other lottery winners — in South Kingstown and Cranston – also still don’t have the required zoning approvals needed by the end of July in order to open up shop.

A lottery hasn’t even been held yet for the sixth license, as an applicant appeals its disqualification from the process.

The long-delayed effort to license six new Rhode Island medical marijuana dispensaries – known as compassion centers – culminated in a public lottery in October, where the Department of Business Regulation blindfolded a retired FBI agent who pulled lottery balls from a tumbler normally used for games like “Wild Money.”

The goal when the new dispensaries were approved in 2019 was to expand access to the medication to patients across the state (existing dispensaries are in Providence, Warwick and Portsmouth).

The winner in Zone 1 — encompassing most of the northwest Rhode Island towns — was RMI Compassion Center in Woonsocket, which proposed opening in an old Payless shoe store in a strip mall on Diamond Hill Road.

But the Woonsocket Zoning Board last week denied a special use permit in a vote of 4 to 1, according to assistant city solicitor Peter Wasylyk.

The formal written denial has not been finalized, but Wasylyk said the board members indicated the marijuana dispensary was “not in compliance with the character of neighborhood,” citing a children’s trampoline park in the same strip mall. Mayor Lisa Baldelli-Hunt also testified against the proposal. (Her office did not respond to a request for comment.)

The president of the dispensary, Paul Isikwe, could not be reached for comment. He has the option to appeal the denial to Superior Court.

It’s not clear what will happen next, considering RMI was set to be the designated compassion center in Zone 1. The Department of Business Regulation would not say whether a new lottery might be held, or if they would allow RMI to find a new location for its compassion center.

“The department is aware of recent developments in Woonsocket and is currently in communication with the selected applicant as we work to determine next steps,” spokesperson Jennifer McGee said in an email.

Joel Trojan, who also submitted an application in Woonsocket but wasn’t drawn from the lottery, said DBR should have picked backup winners.

“When I was sitting in that room that day, I thought to myself they ought to pull another ball for each zone,” Trojan said. “How smart would that have been?”

Trojan had proposed to open a dispensary in a vacant old bank building, also on Diamond Hill Road. He gave up his lease when he wasn’t picked out of the lottery.

RMI was one of five pre-qualified applicants from geographic zones throughout the state that were picked from the random drawing, nearly a year after dozens of companies had applied for one of the six new licenses approved by lawmakers in 2019. It was the first time since medical marijuana was legalized in Rhode Island that the program was expanded beyond the original three stores.

But while the winners had to have premises secured and submit detailed business, security and financial plans to the state before they applied, not every business had secured final zoning approvals from the town or city where the proposed dispensary was to be located.

Some cities and towns already have designated zones where cannabis businesses are allowed, such as industrial zones, without seeking additional permissions. But others require that a special use permit or a variance be obtained for each business seeking to open. Still others, such as Newport, have banned marijuana retailers altogether.

Three of the five lottery winners did not have zoning approvals, including RMI in Woonsocket, Solar Therapeutics in Cranston and Plant Based Compassionate Care in South Kingstown. They have nine months from the Oct. 29 lottery to secure the final approvals, a deadline that will hit in late July.

Solar Therapeutics, the winner in Zone 4, “hasn’t begun to pursue the permits that they need,” said Jason Pezzullo, the planning director for the city of Cranston.

Pezzullo said the dispensary, proposed for 333-335 Niantic Ave., first needs approval from the Development Plan Review Committee before it can apply for a special use permit from the Zoning Board.

“Neither of those were actively sought by the applicant,” he said. He said the business did send a letter last year indicating its intent to formally apply for the permits, but has not taken any further steps or been added to the committee’s agenda. He noted that two other applicants had received zoning approvals from Cranston prior to the lottery, but weren’t selected from the random drawing.

Pezzullo said Solar Therapeutics’ application also faces a potential hurdle because of a little league field located directly across the street.

Cranston has an ordinance prohibiting marijuana businesses to open within 500 feet of a public park or outdoor sports field, among other sites. But the J.T. Owens Park across the street is located in Providence, not Cranston, making the question more complicated.

Nick Hemond, the attorney for Solar Therapeutics who is also listed as a director of the company, said Cranston cannot use a Providence park to deny a dispensary in Cranston.

“They have no ability to regulate land that’s outside of their city,” Hemond said.

Cranston City Solicitor Chris Millea agreed. “Our ordinance doesn’t take into account land in another jurisdiction,” he said. “Under the General Laws, we can only regulate the land within the borders of the city of Cranston.”

But he noted the planning and zoning boards still have discretion to approve or deny the dispensary’s application.

Hemond said Solar Therapeutics is still on track to open their dispensary at that location, though they are determining whether to build new or utilize an existing building on the site.

Meanwhile, Plant Based Compassionate Care, the winner in Zone 5, also needs both planning and zoning approvals from the town of South Kingstown, according to principal planner Jason Parker.

Parker said a public hearing scheduled for earlier this week before the South Kingstown Planning Board was delayed until April 26 at the applicant’s request. The process of seeking a special use permit from the zoning board can’t take place until after the planning board’s approval.

The DBR still hasn’t scheduled a lottery for Zone 6, which stretches from Pawtucket down to Aquidneck Island. Most of the applicants in the zone failed to secure zoning approvals, other than Mother Earth Wellness in Pawtucket. But Rhode Island Care Concepts, which was disqualified due to a zoning rejection from the city of East Providence, is appealing its exclusion.

The issues with getting the new medical dispensaries up and running comes as the state is closer than ever to legalization of marijuana for recreational use. The medical dispensaries would be the first to sell recreational cannabis starting Oct. 1, according to legislation currently making its way through the House and Senate committee process.

Other recreational retailers would likely take much longer to come online. The bill calls for a newly created Cannabis Control Commission to create and approve regulations, including the process by which retailers will apply and be selected to open cannabis stores.

Gov. Dan McKee’s competing proposal would use the lottery system again to award recreational retail licenses. The randomized lottery idea originally came from former Gov. Gina Raimondo, who was concerned about the appearance of politicians selecting the recipients of the lucrative licenses.

At a recent hearing about the legislation in the House Finance Committee, lead sponsor state Rep. Scott Slater suggested licenses should be picked based on merit in the future.

“People put thousands of dollars into these applications,” Slater said. “We set people up to apply and go through this process, and then we awarded a lot of licenses that won’t be in place to be up and running.”

He asked Matt Santacroce, the state’s director of cannabis regulation, what will happen if the dispensaries don’t have zoning approvals when the nine months is up.

“In the event that an applicant that was selected in the lottery either on the zoning front, or a completely different front …. either falls out of compliance with the regulations, fails to meet the very detailed prerequisites for final licensure over the course of that nine-month period, the department is fully ready to explore alternative paths to making sure there is an open and operational compassion center in each of the six zones,” Santacroce said.

“We have three centers, it’s a monopoly. I’ve been hearing that for years,” Slater said. “And now it’s delayed.”

Steph Machado (smachado@wpri.com) is a Target 12 investigative reporter covering Providence, politics and more for 12 News. Connect with her on Twitter and on Facebook.