Oceanside Approves Conversion of Hemp Farm to Cannabis Cultivation

City sees tax revenue potential in legal cannabis as agricultural region faces challenges.

Mar. 30, 2026 at 5:08pm

Got story updates? Submit your updates here. ›

A photorealistic studio still life featuring a collection of premium, polished raw materials and geometric shapes arranged in a clean, minimalist composition, conceptually representing the diversification of Oceanside's agricultural sector and the city's embrace of the legal cannabis industry as a new economic driver.A symbolic still life capturing the intersection of Oceanside's agricultural heritage, cannabis industry growth, and municipal economic strategy.Oceanside Today

The Oceanside Planning Commission has unanimously recommended approval for a proposal to convert a hemp-growing operation to cannabis cultivation in 25 existing 'hoop houses' in the South Morro Hills agricultural region. The applicant, South Morro Hills 47, LLC, received a local license for cultivation through the city's merit-based selection process in 2019 and is now seeking a conditional use permit to grow cannabis on the 2-acre site, which has been used for commercial hemp production for the past two years.

Why it matters

Oceanside's agricultural region has faced increasing costs and competition, leading some farmers to explore new crops like cannabis as a way to preserve agriculture in the area. The city also sees the potential for tax revenue from legal cannabis cultivation, manufacturing, and retail sales to support the local economy.

The details

The 25 hoop houses on the site were originally built to grow industrial hemp, a fast-growing plant similar to cannabis but with negligible THC levels. The structures will be modified to cultivate cannabis, with features like temperature controls, filtered exhaust fans, supplemental solar-powered LED lights, and extensive security measures to prevent odors and unauthorized access.

  • The Oceanside Planning Commission voted on April 23, 2026 to recommend the City Council approve the conditional use permit.
  • South Morro Hills 47, LLC received a local cannabis cultivation license through the city's selection process on September 1, 2019.

The players

South Morro Hills 47, LLC

The applicant requesting a conditional use permit to convert their hemp farm to cannabis cultivation on a 2-acre site in Oceanside's South Morro Hills agricultural region.

Dustin Campbell

The owner of the 124-acre Campbell ranch, which includes the 2-acre site leased by South Morro Hills 47, LLC.

Oceanside Planning Commission

The city's planning commission that unanimously recommended approval of the cannabis cultivation proposal.

Oceanside City Council

The city council that is expected to approve the conditional use permit for the cannabis cultivation facility in the coming weeks.

Michelle Castellano Keeler

The vice president of Mellano and Company, a local flower, succulent, and ornamental grower who supports the cannabis cultivation project as a way to preserve agriculture in the region.

Got photos? Submit your photos here. ›

What they’re saying

“It may be a new sort of use out there, a new type of crop, … (but) it preserves the idea of agriculture in that area. It's very easy to support.”

— Tom Morrissey, Planning Commission Chair

“We encourage this project at a time when farming becomes less and less viable.”

— Michelle Castellano Keeler, Vice President, Mellano and Company

“The plan is very clear in supporting agriculture, and that's what we've done in our area for many years.”

— Dennis Martinek, South Morro Hills Resident and Former Planning Commission Member

What’s next

The Oceanside City Council is expected to vote on approving the conditional use permit for the cannabis cultivation facility within the next few weeks.

The takeaway

Oceanside's approval of this cannabis cultivation project in its agricultural region highlights the city's efforts to support local farmers and leverage the tax revenue potential of the legal cannabis industry, as traditional agricultural operations face growing economic challenges.