Rep. Cesar Chavez has threatened to call an investigation into whether Scottsdale is violating Arizona state law by failing to allow a marijuana dispensary to open.

The state awarded a retailer called Sunday Goods a license to open in south Scottsdale, but it has been thwarted in its efforts to find a site. It aimed to launch the dispensary at 4255 N. Winfield Scott Plaza, but it was met with opposition from a group of local property owners.

They are concerned it will lower the character of the neighbourhood and reduce the value of their properties. The group successfully secured a “legal protest” against the project, and that required it to gain five City Council votes instead of the usual four in order to gain the green light.

One of the protestors reportedly said the group knew that Sunday Goods would not achieve the requisite number of votes to progress. In the end an attorney representing the retailer withdrew the application before the vote could take place.

Sunday Goods spokesman Jason Rose said the protesting business owners are hypocritical, considering the site is flanked by two bars and a tattoo parlour. He added that one of the bars has a social media account that posts sexually explicit material.

The site at 4255 N. Winfield Scott Plaza was apparently selected because it was the only suitable plot available. Rose warned that the city may face legal repercussions if it does not find a new site for the dispensary.

Rep. Chavez, a Democratic lawmaker representing parts of west Phoenix, El Mirage, and Glendale, wrote to Scottsdale City Council to say he was troubled to learn that it has considered denying Sunday Goods’ application. He said the failure to promulgate reasonable zoning regulations appears to be a clear violation of state law.

If Scottsdale is found to be in breach of state law, it could theoretically be denied funding until the situation is resolved. Various Arizona lawmakers have exercised their power over cities in the past.

Scottsdale Mayor Jim Lane responded by saying it was a sorry day and that Chavez is no friend of Scottsdale.

Sunday Goods produces cannabis in southeastern Arizona and it expects to be able to open a dispensary in south Scottsdale soon after securing the sole license for the neighbourhood in a 2017 lottery. The area has been identified as one of the most underserved in the state following an Arizona Department of Health Services.