City of Costa Mesa
Agenda Report
77 Fair Drive
Costa Mesa, CA 92626
Item #: 23-1401 Meeting Date: 10/17/2023
TITLE: APPEAL OF PLANNING APPLICATION 22-05 FOR A RETAIL CANNABIS STOREFRONT BUSINESS LOCATED AT 1505 MESA VERDE DRIVE EAST (“C21+”)
DEPARTMENT: ECONOMIC AND DEVELOPMENT SERVICES DEPARTMENT/PLANNING
DIVISION
PRESENTED BY: MICHELLE HALLIGAN, CONTRACT PLANNER
CONTACT INFORMATION: MICHELLE HALLIGAN, (714) 754-5608
RECOMMENDATION:
Staff recommends that the City Council uphold the Planning Commission’s decision and adopt a Resolution to approve Planning Application 22 -05. The City Council may also overturn the Planning Commission’s decision and deny the request, and direct staff to prepare a Resolution reflecting the City Council’s findings for denial.
APPLICANT OR AUTHORIZED AGENT
The applicant/authorized agent is Sean St. Peter, on behalf of the property owner, Onnyx Investments, LLC.
BACKGROUND:
The subject property is located at 1505 Mesa Verde Drive East and is an approximate half -acre property. The site is zoned C1 (Local Business District) and is surrounded by other commercially zoned properties to the north, south, east, and west. The site ha s a General Plan Land Use Designation of “General Commercial”. The surrounding uses include a liquor store , a 24 -hour convenience store, auto dealership, hotel, multi-tenant commercial centers with offices, restaurants, and a senior living apartment community (“Azulon at Mesa Verde”), that is located across Mesa Verde Drive East.
Existing development on the subject property consists of a 5,941-square-foot single-story multi-tenant commercial building. The property was originally developed in the mid -1960s. Parking spaces are provided in a surface parking lot which serves the commercial building. Access to the site is provided by two one-way driveways located along Mesa Verde Drive East. There are four tenant spaces in the existing building. “California Hairlines”, “Classy Spa”, and “M & K Salon” currently occupy three of the four existing tenant spaces. The fourth tenant space was previously occupied by a restaurant and ceased operations over a year ago. The proposed retail cannabis storefr ont use with delivery is proposed to occupy the entire building.
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Item #: 23-1401 Meeting Date: 10/17/2023
Staff and the City’s cannabis consultant completed the required Pre-application Determination, Business Plan and Security Plan evaluations, owner background checks, and thoroughly reviewed the CUP materials. To ensure neighborhood compatibility, proposed project conditions were included such as having a security guard onsite at all times, interior and exterior camera surveillance, posting parking lot signs to remind customers to keep noise l evels to a minimum, shielding security lighting down/away from neighboring properties, and limiting customer access to the hours between 9 AM and 10 PM. The proposed project also meets separation requirements as established in CMMC 13 - 200.93(e).
Public Comment
Twelve public comment letters opposing the proposed use were submitted to the City prior to the Planning Commission hearing. During the public hearing, the 1505 Mesa Verde Drive East property owner provided three public comment letters in support of the proposed use from the current tenants.
During the public hearing, three members of the public spoke in opposition to the project.
Planning Commission Approval
The application was heard by the Planning Commission on August 14, 2023. After receiving staff‘s presentation and recommendation for approval , the Planning Commission asked questions of staff and then opened the public hearing. The applicant provided a PowerPoint presentation and the Planning Commission subsequently asked questions of the app licant, members of the applicant’s team, and the property owner. The Planning Commission then heard and considered public comments before closing the public hearing.
During Commissioner deliberations, Commissioner Vivar made a motion to deny the application, and the motion was seconded by Commissioner Andrade. Commissioner Vivar indicated that the proposed use would not meet the required CUP findings in that the use would not be compatible with adjacent uses and would be materially detrimental to other p roperties as well as the health, safety, and general welfare of the public. Commissioner Zich subsequently made a substitute motion to approve the application, subject to conditions of approval. Commissioner Klepack seconded the motion. Commissioner Zich d escribed voter support for Measure Q and also indicated that the implementing ordinances included minimum separations from certain uses, and none of the “sensitive uses” listed in the Municipal Code were located within minimum distances. Commissioner Zich further noted that the Planning Commission is charged with the responsibility to evaluate applications based on the Costa Mesa Municipal Code (CMMC), and he believed that the subject application is compliant with the City’s Code requirements and the required Conditional Use Permit findings can be made. The Planning Commission approved the application on a five to two vote , with Commissioners Vivar and Andrade voting no.
The final Resolution reflecting the August 14, 2023 , Planning Commission ac tion is provided as Attachment 3 to this report. The meeting minutes and public comments considered by the Planning Commission are provided as Attachments 4 and 5, respectively. The Planning Commission staff report and meeting video are provided at the links below:
• Planning Commission Staff Report & Attachments –
https://costamesa.legistar.com/LegislationDetail.aspx?ID=6315955&GUID=1C70F276-E5AD-4A30- 8F71-719BB0C15FCC
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• Planning Commission Meeting Video –
https://costamesa.granicus.com/player/clip/4025?view_id=14&redirect=true&h=5ff586b772bf54591a 61160adb868eec
Conditional Use Permit Findings
At the August 14, 2023 hearing, a majority of the Planning Commission believed that the City’s required Conditional Use Permit (CUP) findings were satisfied by the proposed retail cannabis application. Pursuant to the CMMC, in order to approve a CUP application, the final review authority shall find that the evidence presented in the administrative record substantially meets the following findings:
“The proposed development or use is substantially compatible with developments in the same general area and would not be materially detrimental to other properties within the area”; “Granting the conditional use permit will not be materially detrimental to the health, safety and general welfare of the public or otherwise injurious to property or improvements within the immediate neighborhood”; and
“Granting the conditional use permit will not allow a use, density or intensity which is not in accordance with the general plan designation and any applicable specific plan for the property”.
Appeal of the Planning Commission’s Approval
An appeal of the Planning Commission’s approval of the project was timely filed with the City Clerk by Mark Les, the owner and property manager of Mesa Verde Plaza , located at 1525 Mesa Verde Drive East. The appeal application is included as Attachment 2 to this report.
ANALYSIS:
Issues Raised in the Appeal Application
The appeal application describes the 1525 Mesa Verde Drive East property owner’s five key concerns regarding the potential impact of the proposed cannabis storefront , including that the proposed cannabis retail storefront would be:
“Detrimental to the 45 mostly small family businesses at Mesa Verde Plaza”; “Detrimental to attracting future desirable tenants to Mesa Verde Plaza”; “Detrimental to parking at Mesa Verde Plaza”;
“Detrimental to security in Mesa Verde Plaza and surrounding neighborhood; and “Detrimental to sustainable community development”
City Council “De Novo” Hearing
Pursuant to CMMC Chapter 9, Appeal and Review Procedures, the City Council shall conduct a new or “de novo” review of the matter being appealed. T he City Council may exercise its independ ent judgment and discretion in making a decision, and the appeal hearing is not limited to th e grounds stated for the appeal or the evidence that was previously presented to the Planning Commission.
Nevertheless, there shall be a presumption that the decision made by the Planning Commission was 234
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reasonable, valid, and not an abuse of discretion , and the appellant has the burden to demonstrate otherwise. The City Council’s decision on the matter is the final decision.
ENVIRONMENTAL DETERMINATION:
As approved by the Planning Commission, the project is categorically exempt from the provisions of CEQA pursuant to CEQA Guidelines Section 15301 for the permitting and/or minor alteration of Existing Facilities, involving negligible or no expansion of the existing u se. This project site contains an existing commercial building that has been used for commercial activities and the application does not propose an increase in floor area. The project also complies with all applicable business operational standards of Titl e 9 and 13 of the CMMC. Furthermore, none of the exceptions that bar the application from a categorical exemption pursuant to CEQA Guidelines Section 15300.2 applies.
Specifically, the project would not result in a significant cumulative impact; would not have a significant effect on the environment due to unusual circumstances; would not result in damage to scenic resources; is not located on a hazardous site or location; and would not impact any historic resources.
However, if the City Council desires to overturn the Planning Commission decision and deny the subject CUP application , CEQA does not apply to projects which a publi c agency rejects or disapproves per CEQA Guidelines Section 15270(a).
ALTERNATIVES:
The City Council has the following alternatives:
1. Deny the request and approve the application . The City Council may uphold the Planning Commission’s decision and adopt a Resolution to approve the application . The City Council may approve the application subject to findings as identified by the Planning Commission , and/or add/modify the findings and project conditions of approval;
2. Approve the appeal request. The City Council may overturn the Planning Commission’s decision and deny the subject CUP application, and direct staff to prepare a Resolution for denial reflecting the City Council’s findings for denial; or
3. Remand the request back to the Planning Commission.
FISCAL REVIEW:
There are no fiscal impacts to the City’s General Fund with this agenda item.
LEGAL REVIEW:
The City Attorney’s Office has reviewed this report and approves it as to form.
PUBLIC NOTICE:
Pursuant to Title 13, Section 13 -29(d), of the Costa Mesa Municipal Code, three types of public notification have been completed no less than 10 days prior to the date of the public hearing:
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1. Mailed notice. A public notice was mailed to all property owners and occupants within a 500 -foot radius of the project site. The required notice radius is measured from the external boundaries of the property.
2. On-site posting. A public notice was posted on each street frontage of the project site.
3. Newspaper publication. A public notice was published once in the Daily Pilot newspaper.
Any public comments received prior to the October 17, 2023, City Council meeting may be viewed at this link: CITY OF COSTA MESA - Calendar (legistar.com) CITY COUNCIL GOALS AND PRIORITIES:
This item is administrative in nature.
CONCLUSION:
The project proposes a retail cannabis storefront business with delivery at a n existing multi -tenant commercial property located at 1505 Mesa Verde Drive East. The property meets the minimum requirements established in the CMMC.
On August 14, 2023, the City ’s Planning Commission approved the application on a five -two vote. A neighboring commercial property owner appealed that decision to the City Council citing concerns that the proposed use would be detrimental to surrounding businesses, cause parking and security issues, and would be detrimental to sustainable land planning.
The City Council’s review of the application is “de novo”. Staff recommends that the City Council uphold the Planning Commission’s decision and adopt a Resolution to approve the request. The City Council may also overturn the Planning Commission’s decision and deny the request, and direct staff to prepare a Resolution reflecting the City Council’s findings for denial.
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