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By El Paso Cannabis Club in Cannabis News —

Proposed Sunland Park Cannabis Dispensary Sparks Zoning Controversy

Proposed Sunland Park Cannabis Dispensary Sparks Zoning Controversy

The Proposed Dispensary and Its Location

A newly proposed cannabis business in Sunland Park, New Mexico – one of two under consideration – has ignited controversy due to its size and location. The flagship proposal, known as “Station X,” is planned as a two-story dispensary with an on-site consumption lounge at 420 Emory Drive in Sunland Park (Ground News). This location is near the Texas–New Mexico state line (in the Upper Valley area by a Walmart and the State Line Restaurant), meaning it sits virtually adjacent to residential neighborhoods in Texas. Station X intends to offer standard cannabis retail sales and also an “indoor consumption lounge” where patrons could consume cannabis on the premises (Ground News). The inclusion of a lounge makes it more than a typical dispensary – essentially a cannabis café or club.

In addition to Station X, a second dispensary was on the agenda for city approval. Details on the second proposal have been less public, but officials noted it would also be a retail cannabis outlet and may even include a drive-through service for customers (a feature that Sunland Park now permits – see below) (El Paso representative addres) (New Mexico Political Report). Both proposed businesses require new construction or significant development approvals, which is why they came before the city’s Planning and Zoning Commission in early April 2025.

person holding grey tongs and kush
Photo by Budding . / Unsplash

Several zoning and legal questions surround these proposals. Location restrictions have been a focal point. Sunland Park’s city ordinances require any cannabis establishment or consumption area to be at least 200 feet away from any existing school or daycare (3-8-4). (This buffer was originally 300 feet but was reduced to 200 feet in mid-2022 when the city amended its code to be more business-friendly (New Mexico Political Report).) City officials have confirmed that both proposed dispensary sites comply with the 200-foot school/daycare rule. However, opponents note that proximity to other sensitive areas – such as homes just across the state line – is not addressed by New Mexico law. The Station X site, for example, would not border any New Mexico residences, but it lies extremely close to a residential subdivision in Texas (separated only by the invisible state line). This unique situation raises the question: should Sunland Park consider out-of-state neighborhoods in its zoning decisions? Legally, the city is not required to factor in Texas properties, but the optics of a cannabis lounge “virtually close enough to [Texas] residential property” have stirred debate (El Paso representative addresses controversial cabaret proposal in Sunland Park).

Another zoning issue is the need for a special use permit or zoning approval for cannabis operations. Under Sunland Park’s municipal code, cannabis retailers and lounges are not automatically allowed in every commercial zone – they must obtain a Special Use Permit and meet the city’s Cannabis Zoning Matrix requirements (3-8-3:). This process gives the Planning and Zoning Commission (and potentially the City Council) discretion to approve or deny based on local compatibility. Concerns about traffic, parking, and safety at the proposed sites have been raised as factors in this discretionary review. For instance, Station X’s plan for on-site consumption means customers might spend extended time at the venue, potentially impacting traffic flow and requiring ventilation measures for smoke. City code also limits operating hours for cannabis businesses (e.g., consumption areas can only operate between certain hours) to mitigate late-night disturbances (NM RLD). Compliance with these local regulations is under scrutiny as part of the approval process.

Finally, Sunland Park’s handling of these proposals intersects with its broader cannabis ordinances. In 2021, after New Mexico legalized adult-use cannabis statewide, the Sunland Park City Council adopted local rules to manage the emerging industry. Notably, the city permits drive-thru cannabis sales (something not common in all jurisdictions) and formalized the 200-foot buffer rule mentioned above (New Mexico Political Report). These rules were meant to encourage cannabis commerce while maintaining some community protections. Now the city must interpret how those rules apply – for example, ensuring the dispensary buildings are zoned appropriately and that any consumption lounge meets safety standards – and whether any additional zoning variances or changes are needed for these specific projects.

Actions by the Planning & Zoning Commission

The Sunland Park Planning and Zoning Commission took up these dispensary proposals in a meeting on Wednesday, April 9, 2025. At that meeting, the Commission voted to postpone any approval of the construction plans for the two cannabis businesses (Ground News). In other words, rather than giving a green light (with or without conditions) or an outright denial, the commissioners tabled the decision for a later date. According to local news reports, the agenda item drew significant discussion and public comment, which likely influenced the decision to delay. By postponing, the Commission signaled that more information and deliberation are needed before the projects can move forward. This could mean they are seeking:

  • Clarification on zoning compliance: e.g. ensuring that the exact distances to any sensitive sites are verified and that the projects meet all code requirements (parking, ventilation for the lounge, etc.).
  • Input from other agencies or studies: The Commission might request a traffic impact analysis or consult public safety officials about the implications of an on-site consumption lounge.
  • Community feedback: The controversy itself suggests the Commission wants to give residents (and even nearby Texas neighbors) additional opportunity to voice support or concerns before a final decision.

Notably, the postponement delays any immediate construction. No new date has been publicly set yet, but the projects will likely be revisited in an upcoming Planning & Zoning meeting once outstanding issues are addressed. The Commission’s eventual recommendation or decision could then determine if the proposals proceed to the next step.

City Council Involvement and Local Ordinances

So far, Sunland Park’s City Council has not directly voted on the Station X or related dispensary proposals – the matters first go through Planning & Zoning. However, the council’s past actions frame the debate. In June 2022, the City Council approved an ordinance (2022-10) that made Sunland Park one of the most permissive New Mexico cities for cannabis retail: it lowered the required distance from schools/daycares to 200 feet and explicitly allowed drive-through dispensaries in city limits (New Mexico Political Report). Mayor Javier Perea explained at the time that while there was “some apprehension” on the council about loosening restrictions, they saw “an opportunity to capitalize” on Sunland Park’s borderland location and the huge customer base of nearby El Paso and Ciudad Juárez (New Mexico Political Report). In essence, the city positioned itself to become an “oasis of cannabis” for the region, welcoming new businesses to drive economic growth.

Given that policy stance, the current hesitation by the Planning Commission is noteworthy. It is possible that, if the Commission eventually approves the permits, these items may not need full Council approval (special use permits might stop at P&Z). But if a zoning change or variance is required (for example, if part of the property needs rezoning from residential to commercial), then the City Council would have to vote on that change. In any case, Council members are surely aware of the controversy. They could choose to intervene or provide guidance – formally or behind the scenes – especially if public pressure mounts. No Council vote has been taken yet on these specific dispensaries. The Council will be watching how the situation unfolds, balancing the city’s pro-cannabis economic stance with any need to respond to community pushback.

It’s also worth noting that Sunland Park’s ordinances on cannabis remain in effect and would apply to these businesses if they open. For example, all cannabis retailers must obtain a city business registration and adhere to set hours of operation (the city aligns with state rules, generally allowing sales from early morning to around 10 p.m. or as specified in local code). Any on-site Cannabis Consumption Area (lounge) must be indoors and comply with state smoking regulations – no alcohol can be served, and only adults 21+ can enter those areas (Types of Licenses - NM RLD). These conditions would be enforced by the city and the state licensing authorities to ensure the dispensary and lounge operate legally.

Public Response and Community Concerns

Public reaction to the Sunland Park dispensary plans has been mixed, with strong opinions on both sides. Many local residents – especially those living near the proposed sites – have raised concerns. At the April 9th meeting and in media interviews, some neighbors voiced fears about the “consumption lounge” component in particular. The idea of people using cannabis on-site like a bar is troubling to them because of potential impaired driving, odors, and noise. “The lounge aspect of this situation is the only thing I don’t think is a good idea… in this area, it just doesn’t seem like a good idea,” said one area resident, emphasizing that traffic and the condition of drivers leaving the lounge are major worries (Residents voice concerns). Others have echoed that sentiment – they’re not opposed to legal cannabis per se, but they feel a nightclub-style lounge could endanger public safety if patrons drive away under the influence. Nearby roads like McNutt Road and Emory Drive already see heavy traffic, and neighbors fear added congestion and “the noise” that might come with a late-night venue (Residents voice concerns over potential cannabis business near Anthony, New Mexico).

Beyond the immediate neighborhood, the controversy has drawn the attention of officials and residents across the state line in Texas, who have no legal say but are close enough to be affected. Last year, El Paso City Representative Brian Kennedy held a community meeting about developments in Sunland Park that border his district. He pointed out that one proposed Sunland Park project was a strip club and another a cannabis drive-thru dispensary – both next to El Paso’s homes – and he stated, “I think that it’s wrong if you say because there is a state line there that we’re going to build a topless bar and a drive-thru dispensary, virtually close enough to a residential property” (El Paso representative addres). His comments underline a common refrain from Texas-side neighbors: they feel New Mexico businesses are effectively on their doorstep without input from the community just yards away. While Kennedy’s remarks bundled the dispensary with an unrelated adult business, they capture the cross-border concern that Sunland Park’s zoning decisions can impact El Paso families (who, for instance, might smell cannabis or see increased traffic) even though those families can’t vote in Sunland Park or influence its officials.

On the other side of the debate, cannabis industry supporters and local entrepreneurs are pushing back against the pushback. They worry that Sunland Park might be backtracking on its welcome to legal cannabis. “This reflects badly on the city, on [its] cannabis programs, on the state,” argued Diana Castillo, a representative of the Sunland Park Cannabis Coalition, in response to the projects being stalled (Potential cannabis dispensary in Sunland Park sparks controversy). The Sunland Park Cannabis Coalition (an advocacy group for cannabis businesses in the area) has been urging the city to support licensed operators who are following the rules. Advocates point out that New Mexico legalized cannabis to bring underground markets into a regulated, taxable system, and that Sunland Park has already seen over $1 million in cannabis sales per month due to out-of-state visitors (New Mexico Political Report). Turning away new dispensaries – especially high-end concepts like Station X – could mean lost revenue for the city and state. Proponents also note that the applicants are willing to invest in Sunland Park (building new facilities, creating jobs) and will implement security measures required by law (ID checks at the door, security cameras, etc.). From their perspective, the fears about lounges can be managed with proper regulation, and the economic benefits outweigh the downsides.

In summary, the public discourse has become a classic local battle between economic development and neighborhood impacts. Local residents and some officials worry about quality-of-life issues (safety, traffic, proximity to homes and children), while supporters and would-be business owners emphasize legal compliance and economic opportunity. This has made the proposed Sunland Park dispensary a focal point of a larger conversation: how to integrate the booming cannabis industry into communities in a responsible way.

New Mexico State Law and Licensing Context

This controversy is playing out under the umbrella of New Mexico’s state cannabis laws and licensing regime, which ultimately govern whether a dispensary can open. New Mexico legalized adult-use (recreational) cannabis in June 2021 with the Cannabis Regulation Act, and retail sales began in April 2022. Under that law, cannabis businesses must obtain licenses from the New Mexico Regulation & Licensing Department’s Cannabis Control Division (CCD). Any dispensary in Sunland Park needs a state-issued retail license, and if it wants an on-site consumption lounge, it must obtain a separate Cannabis Consumption Area license (essentially a permit for a designated place where cannabis can be consumed on premises) (NM RLD). The state has set out regulations for these consumption areas – for example, they can only serve cannabis products (no alcohol), only admit adults 21 and over, and must meet ventilation and security standards (NM RLD). Importantly, consumption areas cannot be outdoors in public view; they have to be enclosed or otherwise not visible to the public, which Station X’s indoor lounge plan satisfies.

New Mexico’s approach gives local governments like Sunland Park some control over time, place, and manner of cannabis sales (through zoning and permits), but cities cannot ban cannabis businesses outright. They must allow some reasonable locations. Sunland Park chose to allow them broadly in commercial areas (with the 200-foot school buffer) (New Mexico Political Report). The state law also did not impose a statewide distance requirement, leaving it to local ordinances – hence the significance of Sunland Park’s 200-foot rule. Aside from that, a key state restriction is that cannabis cannot be sold or consumed on federal land or cross state lines. This means Texas residents who buy in Sunland Park must be careful not to carry products back into Texas (where cannabis is illegal) or onto federal property (like border checkpoints). Sunland Park dispensaries, including any new ones, often remind customers of this legal boundary at the state line (New Mexico Political Report).

In terms of licensing status, it’s not publicly confirmed if Station X or the other proposed dispensary have already secured provisional licenses from the state. Typically, entrepreneurs apply for state licenses in parallel with seeking local approval. The New Mexico CCD will check that any local zoning requirements are met (applicants must often submit a zoning compliance statement). If Sunland Park ultimately denies the zoning or permit, the state license could be in jeopardy for that location. Conversely, if local approval is granted, the businesses would still need to pass state inspections and meet all New Mexico cannabis regulations before opening their doors. These regulations cover everything from security plans and product testing to employee background checks and point-of-sale tracking.

It’s worth noting that New Mexico’s cannabis market has been thriving, especially in border towns like Sunland Park that serve customers from Texas. Sunland Park quickly became one of the top-grossing cities for cannabis sales in the state, second only to much larger cities, thanks to cross-border shoppers (Spokesman) (New Mexico Political Report). This state-enabled boom is exactly why Sunland Park’s leadership leaned into cannabis in the first place. Now the challenge is navigating the growing pains – incorporating large, possibly unprecedented businesses like a two-story dispensary with a lounge – within the framework of state law and local ordinances.

Conclusion

The proposed Station X dispensary (and its counterpart) in Sunland Park encapsulate the tensions that can arise with cannabis legalization at the local level. On one hand, New Mexico law and city policy encourage cannabis enterprises, promising tax revenue, jobs, and an alternative to illicit markets. Sunland Park in particular has positioned itself to leverage its location and become a regional cannabis hub (New Mexico Political Report). On the other hand, the practical realities of siting these businesses – especially one featuring a public consumption lounge near a residential area – have prompted community pushback and caution from city officials. The situation continues to evolve: the Planning & Zoning Commission’s postponement indicates a careful approach, and further hearings will hash out whether adjustments (like relocating an entrance, adding traffic control, or other conditions) can address the concerns. Public comments from both concerned residents and cannabis advocates will likely influence the outcome. In the coming weeks, Sunland Park’s leaders must weigh the legal compliance of these proposals and their alignment with New Mexico’s cannabis regulations against the local public sentiment. The resolution of this controversy – whether the dispensaries are approved, modified, or rejected – will set an important precedent for how the city balances economic development with community standards in the new era of legal cannabis.

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