From Prison to Pot

In the wake of the closure of Pugsley Correctional Facility, Kingsley is trading prison jobs for pot jobs.

By Patrick Sullivan | Dec. 2, 2017

Kingsley, it seems, is destined to be home to marijuana growers.

As the address for Pugsley Correctional Facility (originally named Camp Pugsley when it opened as a prison camp in 1956),  it was one of the places where the state sent many low-level offenders, like those convicted of manufacturing marijuana.

Since the prison closed 15 months ago, the Village of Kingsley signed off on permitting marijuana production facilities at its industrial park, a move that officials say wasn’t a direct response to the closure of the prison but should offset some of the job losses.
The irony isn’t lost on some in Kingsley.

“You almost can’t write this story until it actually happens,” said Marc McKeller, a Kingsley Downtown Development Authority board member.

LEAVE THE LIGHTS ON
Pugsley closed in September 2016 amid a declining state prison population and concern over security at the Level One facility — the kind of prison that houses the supposed least dangerous prisoners in the state.

The Michigan Department of Corrections announced the closure four months earlier, stating it was a means to cut costs amid a declining inmate population. The department said closing Pugsley would save $22 million per year.

The prison employed 230 people, including 133 corrections officers, many of whom lived in and around Kingsley. Pugsley housed 1,344 prisoners.

At the time Pugsley closed, the state’s prison population was under 42,000, down from 51,500 in 2007. 

Fifteen months later, the fate of the state-owned real estate where the prison was located is not known.

Chris Gautz, spokesman for the Michigan Department of Corrections, said the state wants to sell the Pugsley property.

“We are seeking to sell the property, but there are no firm plans in place,” Gautz said. “People have shown interest, but we don’t have anything firm at this point.”

Kingsley Village President Rodney Bogart said nothing’s happened at the property since MDOC pulled out.

“They finally turned the lights off after three or four months,” Bogart said. “They had yard lights on in the prison, and they left them on, which seemed stupid.”

There was a rumor going around that the state was going to make Pugsley a women’s prison, but Bogart said he’s got no reason to believe that’s going to happen.

Bogart said the biggest effect the closure has had on Kingsley is the loss of the people who used to work there. Many of them have moved away, and it’s a loss that’s been felt in the local economy.

AN ECONOMIC EVOLUTION
The DDA’s McKellar said the closure of Pugsley isn’t what caused officials to consider and then approve permitting medical marijuana production in the village’s industrial park. That probably would have happened anyway, he said. But he said it’s fortunate that the medical marijuana jobs might come along in the wake of the loss of Pugsley.

“Kingsley did not survive or die on Pugsley,” he said. “I think it had a lot more impact on Fife Lake.”

That’s not to say that Kingsley didn’t benefit from Pugsley. While the prison wasn’t located in Kingsley or in surrounding Paradise Township (it was located in adjacent Fife Lake Township, though the prison had a Kingsley address), the prison did impact Kingsley’s economy.

“I’m sure if you talk to the grocery stores and the gas stations and the small businesses in the area, they can feel it,” McKeller said.

Kingsley wasn’t as well positioned as Fife Lake to accommodate friends and family who were visiting inmates at Pusgley. The village of Kingsley only had a motel and a Subway restaurant, and the township had just one motel to accommodate visitors, he said.

“We certainly didn’t have the ability to service them the way that we would have liked in Kingsley,” he said.

The jobs in medical marijuana production are likely to have a bigger economic impact in Kingsley than prison jobs, however, even if there are fewer of them. That’s because whatever facilities go into the industrial park will pay property taxes. Pugsley didn’t pay property taxes because it was a state government agency.

Bogart agreed that medical marijuana production will have a bigger impact on Kingsley’s economy than the prison.

“It will be a lot more relevant, because the village got no tax benefit from Camp Pugsley, nor did anybody else, so the taxes should help a lot,” Bogart said.

For Kingsley, the medical marijuana facility is a sign of a diversifying economy. There’s already a new restaurant opening to go along with the revitalization of the village’s downtown center that’s unfolded over the past several years and included a revitalized library and community center.

“We’ve got a lot of good growth happening in Kingsley, aside from the medical marijuana facility,” McKeller said.

MEANWHILE, IN FIFE LAKE
The effects of Pugsley’s closure have been felt more acutely a few miles to the east in Fife Lake.

Fife Lake, because it was closer to the prison, received state grants and other contracts to provide services for the facility.

Fife Lake Township Supervisor Linda Forwerck said people are concerned about what the loss of Pugsley will mean. Already, the township lost income because they used to collect fees for ambulance runs to the prison. The loss has thrown off off how emergency services are funded in the township.

Officials are expecting the economic impact to become even bigger when the next U.S. Census is conducted in 2020 because that will reflect the loss of the prison population, meaning that the township will lose revenue sharing dollars.

The extent of the fallout is still not understood.

“It impacted our township and the surrounding areas, because a lot of people worked there,” Forwerck said. “It impacts all of our businesses.”

Medical marijuana producers have also been eyeing the Pugsley site as a potential home for a production facility, but so far officials in Fife Lake have balked at that prospect.
Forwerck and township clerk Terry Street said they hope to find out soon what plans the state has for the site. They hope that it can be a prison again; otherwise, they hope the state can find some use for the property that bolsters the local economy.

“What would be great is if the prison became a prison again,” she said. “We had hoped that there would be a strong push to market that, actually. We don’t know what has happened, so we have a meeting set up with Sen. Wayne Schmidt to talk about this very thing.”
The property may seem out of the way, but it’s actually pretty accessible to the outside world. It’s less than a half mile from M-113 and only a few miles from where US-131 becomes a freeway south of the Manistee River.

Forwerck said she knows there is interest from potential marijuana producers to locate a production facility at the Pugsley site, but she said the township is not ready to approve that.

“Fife Lake Township has not opted in,” she said. “We have had calls from people wanting to operate a grow facility at Pugsley. We’ve decided to see what happens in our neighboring communities such as Kalkaska and Kingsley.”

The township sent out a survey with the latest tax bill to find out what residents would think of the marijuana industry locating in the township.

“It would be nice to have some options other than just medical marijuana,” Street said. “I’m a retired educator, and this medical marijuana thing is pretty foreign to me.”

INMATES GO AND GUARDS RETRAIN
If Kingsley and Fife Lake move on without a prison at the Pugsley site, the change won’t really effect the identity of either place.

Even though Pugsley had a Kingsley address and many of its employees lived in and around the village, Bogart said Kingsley never had the identity of a prison town. It’s not like Newberry, in the Upper Peninsula, where a drive through the heart of town offers glimpses of inmates milling around in the yard behind razor wire.

“I don’t think anybody ever thought of us being a prison town,” Bogart said. “Camp Pugsley is six miles from Kingsley.”

While those 1,344 prisoners were dispersed to other Level One units in prisons throughout Michigan, state officials got busy retraining many of Pugsley’s employees.

Terry Vandercook, Northwest Michigan Works! director of operations, said his office successfully implemented a $420,000 state grant to retrain workers who lost their jobs when Pugsley closed.

Out of roughly 200 who needed services, 155 received help writing resumes, attending workshops, getting retrained, and finding jobs. When the grant was closed, 132 had exited the program and re-entered the workforce. Some of them got new jobs in the area, and some of them left to find work elsewhere.

“It was definitely a success,” Vandercook said. “It certainly had a positive impact on the community because these individuals went basically from one job to the next.”

Anita Lloyd, spokeswoman for the Michigan Corrections Organization, the labor union that represents corrections officers, said the MCO also helped corrections officers either transfer or find other options.

“I think this closure went as smoothly as a closer can possibly go— that’s not to say it isn’t terrible for the staff involved,” Lloyd said.

 
THE STATE OF MARIJUANA IN KINGSLEY
Under the new medical marijuana law, a locality can allow five types of marijuana-related businesses: It can decide to permit the growing of marijuana, the processing of marijuana plants, laboratory testing, secured transportation of the drug, and/or the sale of marijuana through provisioning centers.

Kingsley approved licenses for the first four and rejected allowing provisioning centers, which means that while the village will allow the production of medical marijuana, you will not be able to buy it there.

The village has yet to approve a license for any particular business to operate a medical marijuana production facility in its industrial park, but it’s expected to soon receive an application from the Canadian company TheraCann that could call for the construction of a $20 million facility that would employ 100 people.

“I fully expect that they will submit an application and start the process,” said Marc McKeller of the Kingsley DDA. “I think there are probably other people looking.”

It’s unclear whether Kingsley could or would allow more than one medical marijuana facility to be sited in the village.

It’s also unclear what further change in state law would mean for Kingsley. Kingsley’s local law permits production of medical marijuana, not recreational marijuana, which is expected to be the subject of a ballot measure for legalization in 2018.