Grover Beach selects convicted rapist and felon to run dispensaries

Mayor John Shoals and Councilman Jeff Lee


The Grover Beach City Council voted Monday to award four marijuana dispensary licenses to a group of people who include felons, a man on the sex offender registry list and people affiliated with the League of California Cities.

In September, Grover Beach staff whittled down the list of 12 candidates for two medical marijuana dispensary slots to seven, four in tier 1 and three in tier 2. Experience with marijuana dispensaries was heavily weighted at 25 points. Applicants who scored below 80 points were not eligible.

Tier 1: 90 to 100 points
The Monarch
Natural Healing Center
GDI Grover Beach Retail

Tier 2: 80 to 89 points
Trident Management Solutions
805 Beach Breaks
House of Holistics

In September, the council selected two applicants after reviewing the candidates’ background checks. During the vote, Councilwoman Miriam Shah voiced concerns about some of the applicants’ criminal histories.

At the time, staff determined that the Natural Healing Center and The Monarch were in first and second place. The council then voted to award those two applicants dispensary permits.

However, staff added the points incorrectly. After discovering there was actually a three-way tie between The Monarch, 805 Beach Breaks and The Milkman for second place, the council voted on Oct. 16 to allow the top four applicants to open dispensaries in Grover Beach.

Mayor John Shoals and Councilman Jeff Lee broke from staff recommendations and selected 805 Beach Breaks, number seven in points earned, as their top choice. Ed Esters, one of the three owners of 805 Beach Breaks, had founded a dispensary in San Jose and touted his experience in his application.

When asked by a reporter why he voted for an applicant who is currently on the sex offender registry for a violent crime, Shoals raised his palm at the reporter’s face and walked away.

In 1997, Esters was convicted of drugging, raping and sodomizing a female victim. He was released from prison in 2001.

The state prohibits anyone with violent or serious felonies, a felony controlled substance offense, felonies involving fraud or embezzlement, or any sanctions from local licensing authorities within the past three years from entering the industry. It is unclear if the state will issue a permit to 805 Beach Breaks because of Esters’ criminal history.

Shoals, Lee and Councilwoman Barbara Nicolls voted The Monarch as either their second or third choice.

The Monarch is a pot business consisting of six principals, three of whom have ties to the League of California Cities.

David and Sunni Mullinax

Patrick Shannon, The Monarch’s chief operating officer, is a former employee of the league; Antolin Cardenas, another principal, currently works as the League’s public affairs regional manager for its Orange County Division; and the CEO of the Monarch, Sunni Mullinax, is married to David Mullinax, the league’s local representative on the Central Coast.

As employees of the league of cities, David Mullinax and Cardenas were tasked with lobbying cities to pass ordinances that ban dispensaries. Employee rules prohibit outside activities and employment that conflicts with league business.

“Activities and conduct away from the job must not compete with the league business or adversely affect job performance and the ability to fulfill all job responsibilities,” according to the League of California Cities employee handbook.

David Mullinax, who lobbied several local cities to enact ordinances banning cannabis dispensaries, said he is not involved in his wife’s business.

“I told my wife I cannot be part of this,” David Mullinax said. “I told her there has to be a firewall. I never advocated for her group. No league resources or time went into this.”

Because of the California law that prohibits people convicted of drug related felonies from entering the cannabis industry, David Mullinax, who was convicted of trafficking cocaine when he was 22-years-old, could have a difficult time entering the industry.

In response to questions about a possible conflict because of his close friendship with Mayor Shoals, David Mullinax said they have never discussed the application.

“John and I do not talk about this,” David Mullinax said. “John is very ethical.”

All four council members voted for Natural Healing Center as their second or third choice. Lee said he liked what owner Helios Dayspring has done for the community.

Dayspring has sponsored several children’s events where he has promoted his pot brand.

California marijuana law prohibits licensed marijuana companies from displaying advertising where more than 28.4 percent of viewers are likely under 21 years of age.

Last December, Dayspring’s dispensary sponsored a Christmas toy giveaway. In April, Dayspring organized and sponsored an Easter Egg hunt in Grover Beach for children ages 1 through 11. A banner advertising his cannabis brand hung at the event, while workers sported his marijuana brand on their T-shirts.

Dayspring is currently advertising a children’s Halloween party sponsored by his marijuana brand.

There are also questions about the amount Dayspring reported he paid to Thomas Yanaga for a residence in Atascadero in 2015. In 2008, Yanaga bought the home on 8405 San Gregorio Road in Atascadero for $688,000.

In March 2015, Yanaga was arrested for shooting and killing Marshall Savoy at a home Yanaga owned in Paso Robles.

After his arrest, Yanaga used the Atascadero home as collateral on a $1 million bail bond.

The Yanagas decided to sell their Atascadero house following the shooting, and were looking for someone who could pay a chunk of the value in cash to help prevent a wrongful death lawsuit, an affiliate of the Yanagas said.

In 2015, Dayspring reported he purchased the San Gregorio Road home for $303,000, less than half of what it was worth at the time, according to property records and a local broker.

In 2017, Dayspring was targeted in a home invasion robbery at the San Gregorio Road home. Robbers who masqueraded as police officers reportedly snatched 100 pounds of medical pot, more than $100,000 in cash and a firearm. Dayspring was able to break free from his restraints and call the police.

Thomas McAuley is the founder of the Milkman collective, the first choice of Grover Beach staff. Each of the council placed the Milkman in either first, third or fourth place.

At least one council member pointed at McAuley’s criminal history as the primary reason he was not first on their list.

Nineteen years ago, when McAuley was 19-years-old, he was arrested for possession of stolen property, a conviction that does not impact his ability to get a state permit. After McAuley served probation, the charge was reduced to a misdemeanor and later removed from his record.

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13 Comments about “Grover Beach selects convicted rapist and felon to run dispensaries”

  1. Tom Petty says:

    “John and I do not talk about this,” David Mullinax said. “John is very ethical.”

    Me ? Not so much.

    1. Tom Petty says:

      Maybe what we need is to set up a Bong at the next Council meeting and reduce the strife that has developed over this issue. Nothing like being Stoned to cut through the BS.

  2. perk o late says:

    Shoals shows up for the Walk a Mile in Her Shoes event, soaks up the photo ops and then cuts out. He’s never as much walked 2 blocks let alone a mile. He’s a crook and a phony and Jeff Lee is in serious training to be heir apparent.

  3. seeker says:

    I am horrified at the thought of a convicted sex offender (rape and sodomy) running a business just around the corner from Pacific Flips and the 400 children who are attending the dance academy.

    As a nation, we are finally coming together to speak out against sexual harassment, and yet, Mayor Shoals and Council Member Lee see no problem with bringing a convicted sex criminal to town to run a business when there were clean local applicants applying for permits to run dispensaries.

    The hypocrisy is sickening. Every year when “Walk A Mile In Her Shoes”, the rape prevention walk, comes around, Shoals and Lee laugh and brag about their participation in high heels. Looks like this is merely window dressing as cover for their real values. I hope there will be people to protest their participation next year.

    Not rape, but a crime against women when back in 2008 Shoals ran three women out of their jobs, and one of them out of town after sexually harassing them.

    For years, fellow Councilmembers who liked Shoals’ wife cringed when attending California League of Cities activities because Shoals always had a new shapely young woman on his arm, sometimes introduced as his “cousin”, only rarely his wife.

    All the brouhaha about a former mayor asking if Shoals and Lee were whores was right on point. If the price is right sodomy, rape, and sexual harassment don’t matter to them.

  4. MistressMayWest says:

    I thought Grover Beach hired a detective who’s sole job is to do background and compliance checks on people wanting to be involved with the cannabis industry? Did that not happen? If not, seems like they are putting the cart before the horse.

    1. seeker says:

      Yes, so did I. Seems like they limited the kinds of convictions they were concerned about and limited the time to “in the past 5 years”. They assigned 25 points out of 100 for experience in running dispensaries and I think only 10 points to moral turpitude within the past 5 years.

  5. Shenanigan says:

    Jeff Lee does whatever Shoals tells him to do. The guy doesn’t have a brain.

    This whole thing stinks. How much $$$$$ is going to these council people and to supervisor Hill–he must have his hand in this.

    Thanks to KAren Velie for shining a light on the dirty secrets of Grover Beach.

    1. seeker says:

      The other council members also do whatever Shoals wants them to do, and whatever Adam Hill wants them to do.

  6. insidelookingout says:

    This one is easy. If it looks like a duck, walks like a duck and quacks like a duck I’m going to say it is a duck. A very guilty duck too.

  7. Rich in MB says:

    It’s the pot business….what type of people do you think it attracts?
    Pillars of the community? No…this is the real face of the Pot business folks. Get ready.

    1. mkaney says:

      FALSE. This is not the type of people the pot business attracts. And the fact you have 10 up votes at this moment is a testament to the continued blindness that surrounds the issues here. Even before it was legal, the pot business attracted a HUGE range of people from hardcore criminals to Ivy league level students to business owners to doctors. Of course you perceive that it was criminals, because that was the only time you were actually made aware of someone’s involvement… when they got caught.

      The problem with that perception now is that it is leading to over-regulation, and the irony of the over-regulation is that it is actually encouraging corrupt players and criminals who are connected to people like Democrat political strategist Cory Black. In fact on his 460 for L-16 in Grover Beach, one of the four donors is not just linked to organized crime, he’s actually involved. Because people are so concerned about criminals and are allowing the limiting of the number of players in the game, the decent people are being left out while the permits are going to the shadiest people imaginable.

      1. seeker says:

        Correct, Kaney. There are a number of local folks in the business who have clean background checks, good business track records, and a commitment to running businesses that are committed to the local community. Unfortunately, they have been squeezed out by Shoals and Lee, to the detriment of our local businesses and business owners.

  8. Otis says:

    Again, Karen Velie, in her quest for editorial excellence, rings the bell on exposing the smell of corruption. That aroma this time is not the vapors from the political and management mess at the Sanitation District. They emanate from something more hideous and threatening: individuals with conflicts and questionable character commercially exploiting drug intoxicants via four marijuana dispensaries in Grover Beach. This is really alarming.

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