Vertical Enterprises receives approval to change processing location

The first application change request approvals are trickling in. Two of which were approved went to Vertical Enterprises, located in St. Joseph, Missouri.

The change requests approved both their cultivation and manufacturing facilities moving nearby for new construction, as opposed to their prior plan of retrofitting a previously existing structure for the operation.

Vertical Enterprises, led by CEO Chris McHugh, is set to provide “Grade A flower and concentrates.”

“That is really our core competency,” McHugh said. “Our sister company, Clutch Extracts, is already established and operating in Colorado and selling similar products to what we will be producing and selling. We’re working on a website, but you can check out clutchextracts on Instagram to get a good idea of what will be available.”

McHugh said the change will make it possible for Vertical to execute its original plan, which is to provide patients the best quality indoor marijuana grown without the energy ravenous methods traditionally used for growing indoor marijuana.

“One percent of this country’s power is used to grow indoor marijuana,” McHugh said. “We think people not only care about product quality but also how it is grown. Instead of using high-pressure sodium lights and retrofitting a warehouse with 30’ tall ceilings that have to be climate controlled, our facility will be 100 percent purpose-built and LED. We care about marijuana, but we also care about the planet we live on.”

For changes from the application to be approved, the licensed applicant must prove to the state that their original plan was unduly burdensome. The process, which McHugh calls “grueling,” took Vertical about a month from beginning to approval. McHugh’s partner, Andrew Goodwin, led the change request process, to which McHugh said deserves all the credit.

“The Department is definitely doing a great job of vetting these applications,” McHugh said. “I got email questions from staff late at night. And you’ve seen the report the Department wrote. I can tell you that the Department is working night and day to make sure these change applications are worked properly. I appreciate that. The Department put a lot of work into this approval.”

McHugh said they worked hard with the Department on the timeline of the request, which could not be submitted to the Department until they had completed verification. Though verified, the company watched its original property fail environmental tests and had to pray for a Hail Mary that a new location would be approved.

The new building will be 60,000 square feet.

   

Vertical hit a wall after licensure when their cultivation and manufacturing facility property was revealed to have several environmental concerns they were not previously aware would be problematic. They canceled their purchase option on the property and pivoted, hoping the state would approve their new plan to locate their facility less than 10 miles away in the same zip code – but no promises.

But how close was the call? Their purchase option was canceled on March 30, 2020, and on May 8, 2020, Facility License Manager Tina Amick initiated a Change Request Review. Amick signed the letter of approval, along with a 26-page review of the request, received on June 12, 2020.

“It’s pretty clear that our original location was no longer going to work at all. It just wasn’t an option,” McHugh said. “If we had not been approved, I don’t know what we would have done. Now, we are building a state of the art brand new 60,000+ cultivation center that will be one of the best facilities in the state and at full capacity will be able to provide almost 1,000 lbs. of grade A indoor medical marijuana a month.”

“At a certain point, given the mounting problems and tight timeline, we just had to pivot and trust the Department. Definitely white knuckles,” McHugh said. “I know they put in a lot of extra hours to try and turn stuff around in a timely manner.”

The final report states that it “was completed using the information provided in the application for change, the Licensee’s Evaluation Scoring Criteria question responses, data provided through the change request process, and follow-up communication such as emails and phone calls.”

Now approved, Vertical has started pulling their new building permits and plans to break ground in the next weeks, completing the build-out this fall and having product available, hopefully, in the first quarter of 2021.

The change request approval is not only considered beneficial by McHugh for the company and company timeline, but the movement on requests shows more industry momentum.

“Anything that moves the program forward in Missouri is great,” McHugh said. “I believe we should always keep in mind that we are trying to build a completely new industry. That takes time. The Department is working hard to do its part.”

Vertical now moves forward with construction and must pass commencement inspection within one year of the license awards to operate. The company also has dispensary licenses.