Back in 2015, San Leandro was one of the first local cities, outside of Oakland and Berkeley, to embrace the future of medical cannabis dispensaries. But that early decision is costing the city’s dearly after California voters approved legislation of all cannabis more than a year later. Now San Leandro city officials are moving toward offering licensed operators the ability to sell retail adult use cannabis.

A city staff presentation Tuesday night also recommends the council look at imposing a “shot clock” on the two permitted medical cannabis operators that have yet to open despite being granted approvals by the City Council in 2015 and 2016.

Currently, San Leandro is surrounded by a sea of East Bay cities that already allow the retail adult use cannabis, including Oakland, Berkeley, Emeryville, Alameda, Hayward, and unincorporated Alameda County.

“It is currently unclear whether medical-only cannabis dispensaries will remain financially viable in San Leandro over the long-term given the close proximity of alternative access to the adult use market,” according to a staff report released last week.

“Representatives from San Leandro’s three permitted dispensaries expressed to staff that their businesses would remain at a competitive disadvantage if the City does not allow them to serve the adult use market.”

Harborside, Blum, and the Davis Street Wellness Center represent San Leandro’s permitted dispensary operators, but only Blum, which opened its doors last month, is currently in business. The lack of tax revenue from medical cannabis sales has been a concern to the city in recent months.

City staff is also proposing an amendment to any changes to the cannabis ordinance to  potentially include an expiration date, or, “shot clock,” on the Harborside and Davis Street Wellness Center permits if they do not open by Dec. 31, 2019.

Harborside became San Leandro’s first-ever dispensary permit holder in September 2015. Davis Street received approval in July 2016. Four months later, Blum was also approved.

It remains unclear why Harborside, one of the biggest operators in the country, has taken little action toward setting up shop in San Leandro. Davis Street faced early controversy involving the location of its proposed dispensary at the home of the Davis Street Family Resources Center, a non-profit that caters to disadvantaged women and children.