Agenda — Cudahy City Council, July 16, 2024 (part 15 of 20)

Planning Commission Hearing – April 30, 2018
CCP18-0019
Materials). Prevention, control, and mitigation of dangerous conditions related to storage, use, dispensing, mixing, and handling of flammable and combustible liquids shall be in accordance with California Fire Code Chapters 50 and 57.

Timing: Prior to the issuance of a Temporary/Certificate of Occupancy, the Permittee must obtain LA County Fire Approval for site design, water and access, and hazardous materials.

COMMERCIAL CANNABIS AND CANNABIS PRODUCTS RETAIL DELIVERY (ORD. 673, SEC 5.20.120)
PURPOSE: The purpose and intent of this Section is to regulate the Retail Delivery of commercial Cannabis and Cannabis Products in order to promote the health, safety, and general welfare of the residents and businesses within the City. The City is authorized to regulate this activity pursuant to the State Law.

Condition of Approval No. 21 – Retail Delivery Operating Fees.

Operator/Permittee must pay all operating fees as stipulated within Development Agreement Nos DA18-012C and DA18-020C.

Condition of Approval No. 22 – Retail Delivery Permitted Use Locations.

Retail Delivery of Cannabis and Cannabis Products is a permitted use only on properties within the applicable Permit Zone with a valid Retail Delivery Permit and other requisite permits and entitlements.

Condition of Approval No. 23 – Retail Delivery Customers.

The Retail Delivery of commercial Cannabis and Cannabis Products may only include the Retail Delivery of Cannabis and Cannabis Products by a Retail Delivery Permittee to a customer, patient or primary caregiver, in accordance with State Law, including MAUCRSA.

Condition of Approval No. 24 – Retail Delivery Security. a) Retail Delivery Permittees shall implement sufficient security measures to both deter and prevent unauthorized entrance into areas containing Cannabis and Cannabis Products and theft of Cannabis and Cannabis Products from the Retail Delivery Establishment or employees participating in Retail Delivery. b) All Cannabis and Cannabis Products shall be stored in a secured and locked room, safe, or vault, and in a manner as to prevent diversion, theft, or loss.

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Planning Commission Hearing – April 30, 2018
CCP18-0019
Condition of Approval No. 25 – Retail Delivery Premises.

Individuals shall not be allowed to remain on the Premises comprising of the Retail Delivery Establishment unless they are engaging in activity expressly related to the operations of the Retail Delivery Establishment or are a customer.

Condition of Approval No. 26 – Retail Delivery 24 Hour Notifications.

A Retail Delivery Permittee shall notify the City Manager or the City Manager’s designee within 24 hours of discovering any of the following:
a) Significant discrepancies identified during inventory. The level of significance shall be determined by the City Manager or the City Manager’s designee. b) Diversion, theft, loss, or any criminal activity involving the Retail Delivery Establishment or any agent or employee of the Retail Delivery Establishment. c) The loss or unauthorized alteration of records related to Cannabis, Cannabis Products, registered qualifying patients, primary caregivers, or Retail Delivery Establishment agents or employees.
d) Any other material breach of security.

Condition of Approval No. 27 – Retail Delivery Compliance.

The Retail Delivery of commercial Cannabis and Cannabis Products shall comply with all State and local Law, including all laws requiring presentment of government-issued identification card, physician's recommendation, or commercial Cannabis identification card at the time of initial purchase.

Condition of Approval No. 28 – Retail Delivery Physician Recommendation Verification.

With respect to commercial Cannabis, physicians' recommendations for commercial cannabis use shall be verified by a Retail Delivery Permittee prior to the Retail Delivery any commercial Cannabis to a qualified patient or primary caregiver and at least every six months thereafter.

Condition of Approval No. 29 – Retail Delivery Physician Employment.

A Retail Delivery Establishment may not employ or enter into any agreements with any physicians who recommend commercial Cannabis; Physician Services are prohibited from any and all Retail Delivery Establishments.

Condition of Approval No. 30 – Retail Delivery Inspection, Quality Testing and Quality Assurance.
a) A Retail Delivery Permittee shall inspect all Cannabis and Cannabis Products received for quality assurance prior to the Retail Delivery to any Person. b) The Retail Delivery of Cannabis and Cannabis Products shall occur only after such Cannabis and Cannabis Products have been inspected and quality tested in accordance with applicable State Law, including MAUCRSA.

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Planning Commission Hearing – April 30, 2018
CCP18-0019
Condition of Approval No. 31 – Retail Delivery Monthly Inventories.

Each Retail Delivery Establishment shall do regular monthly inventories and record the total quantity of Cannabis and Cannabis on the Premises. These records shall be maintained for three years from the date created and shall be open to inspection by the City Manager, the City Manager's Designee, and law enforcement.

Condition of Approval No. 32 – Retail Delivery Registration.

A Retail Delivery Permittee shall register with the City each location where Cannabis or Cannabis Products are stored for purposes of Retail Delivery by such Retail Delivery Permittee within the City.

Condition of Approval No. 33– Retail Delivery Business Records.

A Retail Delivery Establishment shall maintain customer and patient and other business records in a secure location (including electronically or cloud-based) that is compliant with, as applicable, HIPAA and other federal and state privacy laws.

Condition of Approval No. 34 – Retail Delivery Vehicle Driver Documents.

During the Retail Delivery of Cannabis or Cannabis Products, each vehicle driver shall carry a copy of the Retail Delivery Permit, a copy of the Retail Delivery request, a form of government-issued identification, and all other information required by State and local Law. The driver shall present these documents upon the request of law enforcement, the City Manager, or the City Manager's designee.

Condition of Approval No.35 – Retail Delivery Labeling and Packaging.

Prior to Retail Delivery of Cannabis and Cannabis Products, such Cannabis and Cannabis Products shall be labeled and placed in a tamper-evident package. Labels and packages of Cannabis and Cannabis Products shall, at minimum, meet the requirements specified under State Law, including MAUCRSA.

Condition of Approval No. 36 – Retail Delivery Requirements.

All Retail Delivery vehicles shall:
a) Be equipped with, and utilize, a vehicle alarm system. b) Have and utilize a direct communication system with the related Retail Delivery Establishment.
c) Keep all Cannabis and Cannabis Products in a secure and locked container. d) Have an internal partition between the driver and all passengers from the Cannabis and Cannabis Products storage containers that prevents access by the driver and passengers to all cannabis products from inside the vehicle. e) Not carry more Cannabis and Cannabis Products than allowed by State and local Law and required to fulfill all immediate Retail Delivery requests f) Not display any logo, signage, or other information that identifies, advertises, or lists the services or the products offered.

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Planning Commission Hearing – April 30, 2018
CCP18-0019
COMMERCIAL CANNABIS AND CANNABIS PRODUCTS DISTRIBUTION (ORD. 673, SEC 5.20.130)
PURPOSE: The purpose and intent of this Section is to permit and regulate the Distribution of Cannabis and Cannabis Products between Cannabis Permittees in order to promote the health, safety, morals, and general welfare of the residents and businesses within the City. The City is authorized to regulate this activity pursuant to State Law.

Condition of Approval No. 37 - Distribution Operating Fees.

Operator/Permittee must pay all operating fees as stipulated within Development Agreement No. DA18-016C and DA18-019C.

Condition of Approval No. 38 – Distribution Development Agreement and Location.

Distribution of Cannabis and Cannabis Products requires a Development Agreement with the City and must be located within the applicable Permit Zone.

Condition of Approval No. 39 - Distribution Activities.

Distribution activities includes the receiving and releasing of Cannabis and Cannabis Products for inspection, Testing, and quality assurance, as required under applicable State Law and such other activities as are permitted pursuant to State Law.

Condition of Approval No. 40 – Distribution Customers.

A Distribution Permittee shall only Distribute Cannabis and Cannabis Products between Cannabis Permittees or to facilities or portions of facilities wholly controlled by such Distribution Permittee to the extent permitted by State Law.

Condition of Approval No. 41 – Distribution Quality Assurance. a) A Distribution Permittee shall inspect all Cannabis and Cannabis Products received by it for quality assurance prior to Distributing to any Cannabis Permittee, as required under applicable State Law.
b) A Distribution Permittee shall Distribute Cannabis and Cannabis Products to Cannabis Permittees only after such Cannabis and Cannabis Products have been inspected and quality tested in accordance with applicable State Law, including MAUCRSA.

Condition of Approval No. 42 – Distribution Registration.

A Distribution Permittee shall register with the City each location within the City where Cannabis and Cannabis Products are stored for purposes of Distribution activities within the City.

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Planning Commission Hearing – April 30, 2018
CCP18-0019
Condition of Approval No. 43 – Multiple Permit Types.

A Distribution Permittee may also hold any other Permit type to the extent permitted by State Law. To the extent permitted by State law, a Distribution Permittee that also holds another Permit type may self-distribute its Cannabis Products.

OTHER OPERTIONAL CONDITIONS
PURPOSE: To ensure compliance with all applicable City, State and other regulatory agency requirements.

Condition of Approval No. 44 – Final Floor Plan Approval PURPOSE: To ensure Operators perform all proposed Tenant Improvements timely and applicable City fees are assessed accurately pursuant to the proposed project request.

Permittee must submit to and obtain approval from the City Manager, or his designee, on all proposed Final Floor Plans. Final Floor Plan must address odor control, waste management, waste water filtration and all other operational information requested by the City.

All Final Floor Plans shall be stamped and dated by the Planning Department upon approval. Changes to the floor plan design or other elements (including, but not limited to security, fire or hazmat details) require administrative approval by the Planning Department, prior to any construction activity or Building Permit Issuance.

Timing: Prior to Zoning Clearance for Use Inauguration, Permittee shall prepare and submit a Final Floor Plan which demonstrates compliance with all City and State Commercial Cannabis regulations.

Condition of Approval No. 45 – Payment of Development Agreement Fees Operator(s) must pay all required DA fees in accordance with DA terms. Failure to pay fees, as assessed by the City Manager, will constitute a breach of the DA and may result in suspension or immediate revocation of the DA.

Condition of Approval No. 46 – Additional Plans and Approvals Purpose: To ensure all Commercial Cannabis facilities meet the development standards of the zoning code, policies, goals and programs of the general plan and City economic development activities—including City beautification and future public improvement projects.

A. Landscape Plan – The Operator must submit a landscaping plan, designed by a licensed landscape architect or arborist. The plan must include a fivefoot landscaped dedication measured from the property line, as illustrated on the approved Site Plan. The plan must include drought tolerant desert plants, approved by the City.

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Planning Commission Hearing – April 30, 2018
CCP18-0019
B. Fencing Plan – Fencing must be provided along the front perimeter of all Commercial Cannabis facilities. Fencing may be constructed between 8 feet and 10 feet in the front and up to 15 feet in the back.

Materials: Corrugated metal, wrought iron, concrete and block wall are all allowed materials. Alternative materials may be allowed with City approval. Chain-link and razor wire are strictly prohibited.

Fences may be required to be constructed 5 feet from the property line to allow for future City improvements. All fencing plans must be submitted to and approved by the City prior to construction.

C. Façade Improvement Plan - All new Commercial Cannabis facilities must submit a Façade Improvement Plan for City approval. The plan must include new paint, siding or other building improvement materials, in a color scheme approved by the City. Plans must also include new paving, as needed, parking striping, and other site improvements, as determined by the City.

D. LA County Public Health Permit – The Operator must submit obtain a Cannabis Public Health Permit from the Los Angeles County Public Health.

E. City Business License – All operators must file for a City business license to conduct business within the City, pay all required business license fees and obtain a City Business License prior to conducting sales transactions in the City.

Timing: Prior to Building Permit, all plans and agency permits must be secured by the Operator(s).

Condition of Approval No. 47 – Site Maintenance
PURPOSE: To ensure that the Project site is maintained in a neat and orderly manner so as not to create any hazardous conditions or unsightly conditions which are visible from outside of the Project site.

The Permittee shall maintain the Project site in a neat and orderly manner, and in compliance with the Project description. Only equipment and/or materials which the City Manager, or his designee, determines to substantially comply with the Project description shall be stored within the Project site during the life of the Project.

The Permittee shall maintain the Project site in compliance with Condition No. 1 and the approved plans for the Project.

Monitoring and Reporting: The City Building Inspector, City Cannabis Enforcement staff, or Planning Department staff have the authority to conduct periodic site inspections to ensure the Permittee’s ongoing compliance with this condition.

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Planning Commission Hearing – April 30, 2018
CCP18-0019
Condition of Approval No. 48 – Commercial Cannabis Permit (CCP) Modification Prior to undertaking any operational or construction-related activity which is not expressly described in these conditions, the Permittee shall first contact the City Manager, or his designee, to determine if the proposed activity requires a modification of this CCP. The City Manager may, at his sole discretion, require the Permittee to file a written and/or mapped description of the proposed activity in order to determine if a permit modification is required.

Condition of Approval No. 49 - Construction Activities
Prior to any construction, the Permittee shall obtain a Zoning Clearance for construction from the Planning Division and a Building Permit from the Building and Safety Division.

Condition of Approval No. 50 - Acceptance of Conditions and Schedule of Enforcement Responses
The Permittee’s acceptance of this CCP and/or commencement of construction and/or operations under this CCP shall constitute the Permittee’s formal agreement to comply with all conditions of this CCP. Failure to abide by and comply with any condition of this CCP shall constitute grounds for enforcement action provided in the City Municipal Code which shall include, but is not limited to, the following:
a. Public reporting of violations to the Planning Commission and/or City Council; b. Suspension of the permitted land uses;
c. Modification of the CCP conditions listed herein;
d. Recordation of a “Notice of Noncompliance” on the deed to the subject property; e. The imposition of civil administrative penalties; and/or f. Revocation of this CUP.

The Permittee is responsible for being aware of and complying with the CCP conditions and all applicable federal, state, and local laws and regulations. In the event of any actual and direct conflict between these Conditions of Approval and the terms of the approved Development Agreement, the terms of the Development Agreement shall control and take precedence.

Condition of Approval No. 51. - Time Limits
A. Use inauguration: The approval decision for this CCP becomes effective upon the expiration of the 15-day appeal period following the approval decision, or when any appeals of the decision are finally resolved. Once the approval decision becomes effective, the Permittee must obtain a Zoning Clearance for Use Inauguration to initiate the land uses set forth herein. i. This CCP shall expire and become null and void if the Permittee fails to obtain a Zoning Clearance for use inauguration within 90 days –from the date the approval decision of this CCP becomes effective. The City

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Planning Commission Hearing – April 30, 2018
CCP18-0019
Manager may grant an extension of time to the Permittee in order to obtain the Zoning Clearance for use inauguration if the Permittee can demonstrate to the satisfaction of the City Manager that the Permittee has made a diligent effort to implement the Project, and the Permittee has requested the time extension in writing at least 30 days prior to 90- day expiration date.
ii. Within 90 days of the permit effective date, the Permittee must complete construction of Phase I, as indicated on the approved Final Floor plan and obtain a Temporary Certificate of Occupancy from the City Building Department. The City Manager may grant an extension of time to the Permittee to obtain the Zoning Clearance for use inauguration if the Permittee can demonstrate to the satisfaction of the City Manager that the Permittee has made a diligent effort to implement the Project iii. Within 180 of the permit effective date, the Permittee must complete all Tenant Improvements and construction as indicated on the approved Final Floor Plan and obtain a Certificate of Occupancy from the City Building Department. The City Manager may grant an extension of time to the Permittee to obtain the Zoning Clearance for construction if the Permittee can demonstrate to the satisfaction of the City Manager that the Permittee has made a diligent effort to implement the Project. iv. Prior to the issuance of the Zoning Clearance for construction or use inauguration, all fees and charges billed to that date by the City, as well as any fines, penalties, and sureties, must be paid in full. After issuance of the Zoning Clearance for Use Inauguration, any final billed processing fees must be paid within 30 days of the billing date or the City may revoke this CCP.

B Permit Life or Operations Period: This CCP will expire on April 30, 2028.

However, the Development Agreement contains terms and conditions for extending operations for an additional 10 years. The lack of additional notification of the expiration date provided by the City to the Permittee shall not constitute grounds to continue the uses that are authorized by this CCP after the CCP expiration date. The uses authorized by this CCP may continue after the CCP expiration date if:
(1) The Permittee has filed a permit modification application 90 days prior to April 30, 2018; and
(2) The City decision-maker grants the requested modification.

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Planning Commission Hearing – April 30, 2018
CCP18-0019
The uses authorized by this CCP may continue during processing of a timely-filed modification application, at the City Managers sole discretion.

In the event of any actual and direct conflict between these Conditions of Approval and the terms of the approved Development Agreement, the terms of the Development Agreement shall control and take precedence. [end of conditions]

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ATTACHMENT D
Final Demand Letter dated October
19, 2021

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ATTACHMENT F

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ATTACHMENT F

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ATTACHMENT E
Correspondence dated October 27,
2022

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From: Glenn Ward Calsada <[email protected]>
Sent: Thursday, October 27, 2022 1:40 PM
To: Charlotte Hodgson <[email protected]>; [email protected] Cc: Vincent Sarmiento <[email protected]>; Alfonso Noyola <[email protected]>; Juan Arauz <[email protected]>; Jessica Guillen <[email protected]>; Joshua Calhoun <[email protected]>
Subject: Re: Cudahy Cannabis Permit Applicant - 420 Club Amended Application to Transfer Ownership
Charlotte Hodgson via email
Maria Ibarra via email and mail: 2218 South Van Ness Avenue, Santa Ana, CA 92707 The 420 Club, LLC via mail: 2321 E. 4th Street, C-319, Santa Ana, CA 92795 The 420 Club, LLC via mail: 4916 Cecilia Street, Cudahy, CA 90201 Hi Charlotte,
A while back we met and discussed your involvement with the 420 Club LLC, a cannabis permittee in the City of Cudahy. The City Manager has asked me to reach out to the principals of the 420 Club, LLC to discuss the status of its development project in the City. The City is in the process of evaluating each site to determine if the operators intend to complete their project. If so, the City would like to meet with each operator (and its principals, including Maria Ibarra) as soon as possible to discuss the project and outstanding compliance issues. Please reply all to this email me as soon as possible.

If we do not hear from you or Mrs. Ibarra within 15 days of the date of this email, we will assume that the 420 Club, LLC does not intend to move forward on its development project. In that event, the City will move forward with setting a default hearing which could lead to the termination of the Development Agreement and revocation of the operator's cannabis permit. We would like to avoid that happening.

Your attention to this matter is now urgent and we seek your cooperation.

Any questions or concerns on this matter, please reply all to this email for a written response.

Best Regards,
Glenn Ward Calsada, Esq.

Special Counsel, City of Cudahy

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Law Office of Glenn Ward Calsada
1209 N. Central Avenue, Suite 205
Glendale, CA 91202
(818) 396-5504 ph
(818) 473-4277 fax
[email protected]
http://www.calsadalaw.com
Certified by the California State Bar,
Board of Legal Specialization in Bankruptcy Law
The information contained in this e-mail may be privileged, confidential, and protected from disclosure. If you are not the intended recipient, you are hereby notified that any dissemination, distribution or duplication of this communication is strictly prohibited. If you have received this communication in error, please notify the sender immediately and delete all copies.

Tax Advice Disclosure: To ensure compliance with requirements imposed by the IRS under Circular 230, we inform you that any U.S. Federal Tax advice contained in this communication (including any attachments), unless otherwise specifically stated, was not intended or written to be used, and cannot be used, for the purpose of (1)avoiding penalties under the Internal Revenue Code or (2)promoting, marketing or recommending to another party any matters addressed herein.

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ATTACHMENT F
Correspondence dated February 17,
2023

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From: Glenn Ward Calsada
To: Charlotte Hodgson; Dareh Zadoorian; maria [email protected]; [email protected] Cc: Juan Arauz; Jessica Guillen; Alfonso Noyola; Joshua Calhoun; Glenn Calsada; Stephanie Arechiga Subject: Re: Cannabis Transfer Documents
Date: Friday, February 17, 2023 6:09:17 PM
Attachments: Member-Resolution.pdf
Articles of Org - 420 Club LLC .pdf
Cudahy -cannabis-transfer-of-ownership-application fillable 5-12-21 Notarized Copy.pdf Statement of Information - 420 Club LLC.pdf
Hi Charlotte,
I have reviewed your documents requesting the City's consent to the transfer of membership interests in 420 Club LLC. The City's role in this process is to review and approve proposed changes to LLC. We also verify the LLC's entity status with the State. Please see my comments on your Transfer Application below.

1. Missing Amended Operating Agreement.

For this Transfer, we will need to see an amended Operating Agreement and a Resolution authorizing the addition of new members into the LLC. In reviewing the LLC's filings, I see no actual change of membership interests has been reported to California Secretary of State. Is there an amended operating agreement for the LLC showing the addition of new members? If so, please send it to me. If not, please see How do I add another owner to my LLC? | LegalZoom for advice on the matter.

In fact, I suggest that you and the others consult legal counsel or an accountant.

2. Missing Resolution of the LLC adding in new members.

Normally, an amendment to the operating agreement is done by a resolution of the LLC signed by Maria adding in the new members. If that was done, please send it to me as well. For your convenience, I have attached a blank Resolution template that can be used for this purpose. Just fill it out, have it signed, and send it to me.

3. The 420 Club LLC is suspended by the State.

Most importantly, The 420 Club LLC's standing with the California Secretary of State is suspended. See below. At this time, The 420 Club, LLC is not authorized to do business in the State of California at this time. The City cannot even process the transfer application until the LLC is revived with the state. The loss of legal status is also an event of default under the Development Agreements and grounds for termination. You and other members are strongly advised to revive the LLC's entity status with the State immediately to avoid termination proceedings. See link on how to revive a California
LLC.https://www.northwestregisteredagent.com/llc/california/reinstate I ask that you acknowledge receipt of this email and provide the requested information and documents within 15 days of the date of this email.

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Suspended - FTB/SOS
Not Good
Not Good
Good
Good
09/09/2020

CALIFORNIA
Limited Liability
Company - CA
25909 PALA, SUITE 300

MISSION VIEJO, CA
92691
25909 PALA, SUITE 300

MISSION
VIEJO,CA92691
11/30/2019
Individual 4940477

THOMAS BORCHARD
25909 PALA, SUITE 300

MISSION VIEJO, CA
92691
Status
Standing - SOS
Standing - FTB
Standing -
Agent
Standing -
VCFCF
Inactive Date
Formed In
Entity Type
Principal
Address
Mailing Address
Statement of
Info Due Date
Agent

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ATTACHMENT G
Final Demand Letter dated April 12,
2023

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ATTACHMENT F

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ATTACHMENT F

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ATTACHMENT H
Deferment & Payment Plan Letter
dated December 7, 2022

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P a g e | 1
5220 Santa Ana Street
Cudahy, CA, 90201
Phone: (323) 773-5143
Fax: (323) 771-2072
www.cityofcudahy.com
Mayor
Elizabeth Alcantar
Vice Mayor
Jose R. Gonzalez
Councilmember
Jack M. Guerrero
Councilmember
Blanca Lozoya
Councilmember
Daisy Lomeli
City Manager
Alfonso Noyola, ICMA-CM
Incorporated November 10, 1960

December 7, 2022
Via U.S. Mail and Email:

The 420 Club, LLC
Attn: Maria Rosa Ibarra, Manager
4916 Cecilia Street Unit G
Cudahy, CA 90201
Re: DA 18-012C
Dear Owner/Operator:

On December 6, 2022, the City Manager presented a Cannabis Deferment and Payment Program to the City Council. Within this program, the City Manager will be utilizing his discretionary authority allowed within the Development Agreements to assist Cannabis Operators with the accumulated non-operating and other fees by deferring and providing additional time for payment without penalty.

The stipulations of this Program will be as follows:
• Unpaid non-operating fees will be deferred (without penalty) until six (6) months after the Operator is issued a Certificate of Occupancy. Thereafter, the accumulated nonoperating fees would be required to be repaid within twelve (12) months or other term negotiated with the City Manager.
o Any previous late penalties charged to non-operating fees would be waived provided that a payment agreement is reach and the operator follows all stipulations within the agreement
• Community Benefit and Cost Recovery Fees, as detailed in the Development Agreement, would have to be paid timely on a monthly basis. Any Fees incurred prior to the agreement would be put under a payment agreement and also required to be paid timely on a monthly basis.
• Payment agreement terms would be subject to the discretion of the City Manager as negotiated with each operator
• The Operators would have to remain in good standing with the City with respect to Planning and Building and Safety Regulations.

In order to be eligible for this program, Operators must have negotiated with the City and entered into an executed payment agreement no later than January 31, 2023.

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P a g e | 2
If you are interested in entering into this deferment and payment program, please contact Joshua Calhoun at [email protected].

Sincerely,
Joshua Calhoun, CPA
Finance Director

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ATTACHMENT I
Invoice Payment Due Letters from
October 2022 to August 2023

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The 420 Club, LLC
Attn: Maria Rosa Ibarra, Manager
4916 Cecilia Street Unit G
Cudahy, CA 90201
Re: DA 18-012C
Dear Owner/Operator:

Below is a summary of past and current amounts due under Development Agreement DA 18-012C for Ordinance No 677, with an Effective date of June 5, 2018.

Fee Type Payment
Amount
Payment Period City
Code
Community Benefit Program $2,666.68
$9,904.83
Outstanding balance through July 31,
2021.

Monthly installments ($761.91) from
August 2021 to August 2022.

CBP
Cost Recovery Fee $20,087.08
$34,118.55
Outstanding balance through July 31,
2021.

City Labor from August 2021 to
August 2022
URBF1
Non-Operating Fee $815.22
$3,532.62
Outstanding balance through July 31,
2021.

August 2021 through August 2022.

The monthly non-operating fee is
$271.74 (.42 x 647-square footage of
the premises)
OPFEE
Total Fees $71,124.98 Due October 31, 2022

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P a g e | 2
Community Benefit Program
The Community Benefit Program (CBP) payment amount is due the first day of each month and is considered late if payment is received on or after the fifth day of the month. All CBP outstanding balance as of July 31, 2021, and current CBP monthly installments totaling $12,571.51 are due October 31, 2022.

Cost Recovery Fee
The outstanding Cost Recovery Fee as of July 31, 2021, the City labor, and third-party contractors from August 2021 to August 2022 totaling $54,205.63 are due October 31, 2022.

Non-Operating Fees
The outstanding balance as of July 31, 2021, and the current monthly non-operating fees from August 2021 to August 2022 totaling $4,347.84 are due October 31, 2022.

Please pay no later than October 31, 2022, to avoid any penalties. If you have any questions related to these items, please contact Joshua Calhoun at [email protected].

Sincerely,
Joshua Calhoun, CPA
Finance Director
See supporting detail attached of monthly billings and payments from August 2021 through current.

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CBP URBF1 OPFEE
Operator Comm Benefit Cost Recovery Non Operating Outstanding The 420 Club, LLC
September 22, 2021 Letter 2,666.68 20,087.08 815.22 23,568.98

PAYMENTS
Aug 2021
Sep 2021
Oct 2021
Nov 2021
Dec 2021
Jan 2022
Feb 2022
Mar 2022
Apr 2022
May 2022
Jun 2022
Jul 2022
Aug 2022
Annual City Reimbursement Costs           72,020.00
Cost per operator (10)             7,202.00
Three years(2019‐2022) 3 years
City Labor           21,606.00 21,606.00
Balance as of August 31, 2022 12,571.51           54,205.63 4,347.84 71,124.98 (a) City Reimbursement cost of $7,202 per year (x three years (2019‐2022)= $21,606.00

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November 14, 2022
Via U.S. Mail and Email:

The 420 Club, LLC
Attn: Maria Rosa Ibarra, Manager
4916 Cecilia Street Unit G
Cudahy, CA 90201
Re: DA 18-012C
Dear Owner/Operator:

Below is a summary of past and current amounts due under Development Agreement DA 18-012C for Ordinance No 677, with an Effective date of June 5, 2018.

Fee Type Payment
Amount
Payment Period City
Code
Community Benefit Program $2,666.68
$11,428.65
Outstanding balance through July 31,
2021.

Monthly installments ($761.91) from
August 2021 to October 2022.

CBP
Cost Recovery Fee $20,087.08
$38,583.49
Outstanding balance through July 31,
2021.

City Labor from August 2021 to
October 2022
URBF1
Non-Operating Fee $815.22
$4,076.10
$285.13
Outstanding balance through July 31,
2021.

August 2021 through October 2022.

The monthly non-operating fee is
$271.74 (.42 x 647-square footage of
the premises)
Penalties August 2022-October 2022
OPFEE
Total Fees $77,942.55 Due November 30, 2022

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Cost Recovery Fee
The outstanding Cost Recovery Fee as of July 31, 2021, the City labor, and third-party contractors from August 2021 to October 2022 totaling $58,670.57 are due November 30, 2022.

Non-Operating Fees
The outstanding balance as of July 31, 2021, and the current monthly non-operating fees from August 2021 to October 2022 totaling $4,891.32 are due November 30, 2022.

Late Payment Penalties
Penalties totaling $285.13 from August 2022 to October 2022 are due November 30, 2022.

Per the Development Agreement, amounts that are more than 30 days late after the due date shall result in a penalty equal to the sum of 25% of the non-operating/operating fees. In addition, a 10% shall be added to the first day of each calendar month following the month of the imposition of the 25% penalty if the fees remain unpaid in whole or in part-up to a maximum of 100% of the fee payable. The City will be enforcing these penalties for amounts due from July 2022 to present, as appliable. No penalties will be imposed on amounts outstanding prior to this date. This will be separately listed on current and future invoice letters provided by the City. Should you wish to avoid penalties, ensure that either amounts payable are paid timely or contact the City to discuss entering into a payment plan on prior amounts outstanding
Please pay no later than November 30, 2022, to avoid any penalties. If you have any questions related to these items, please contact Joshua Calhoun at [email protected].

Sincerely,
Joshua Calhoun, CPA
Finance Director
See supporting detail attached of monthly billings and payments from August 2021 through current.

Page 197 of 241 ends

CBP URBF1 OPFEE OPFEE
Operator Comm Benefit Cost Recovery Non Operating Penalties Outstanding The 420 Club, LLC
September 22, 2021 Letter 2,666.68 20,087.08 815.22 23,568.98

PAYMENTS
Aug 2021
Sep 2021
Oct 2021
Nov 2021
Dec 2021
Jan 2022
Feb 2022
Mar 2022
Apr 2022
May 2022
Jun 2022
Jul 2022
Aug 2022
Sep 2022
Oct 2022 0.00 0.00 0.00 0.00 0.00
Annual City Reimbursement Costs           72,020.00
Cost per operator (10)             7,202.00
Three years(2019‐2022) 3 years
City Labor           21,606.00        21,606.00
Balance as of October 31, 2022           14,095.33           58,670.57                  4,891.32         285.33       77,942.55 (a) City Reimbursement cost of $7,202 per year (x three years (2019‐2022)= $21,606.00

Page 198 of 241 ends

The 420 Club, LLC
Attn: Maria Rosa Ibarra, Manager
4916 Cecilia Street Unit G
Cudahy, CA 90201
Re: DA 18-012C
Dear Owner/Operator:

Below is a summary of past and current amounts due under Development Agreement DA 18-012C for Ordinance No 677, with an Effective date of June 5, 2018.

Fee Type Payment
Amount
Payment Period City
Code
Community Benefit Program $2,666.68
$12,190.56
Outstanding balance through July 31,
2021.

Monthly installments ($761.91) from
August 2021 to November 2022.

CBP
Cost Recovery Fee $20,087.08
$41,174.97
Outstanding balance through July 31,
2021.

City Labor from August 2021 to
November 2022
URBF1
Non-Operating Fee $815.22
$4,347.84
$434.78
Outstanding balance through July 31,
2021.

August 2021 to November 2022
The monthly non-operating fee is
$271.74 (.42 x 647-square footage of
the premises)
Penalties Aug 2022 – Nov 2022
OPFEE
Total Fees $81,717.13 Due December 29, 2022

Page 199 of 241 ends

Cost Recovery Fee
The outstanding Cost Recovery Fee as of July 31, 2021, the City labor, and third-party contractors from August 2021 to November 2022 totaling $61,262.05 are due December 29, 2022.

Non-Operating Fees
The outstanding balance as of July 31, 2021, and the current monthly non-operating fees from August 2021 to November 2022 totaling $5,163.06 are due December 29, 2022.

Late Payment Penalties
Penalties totaling $434.78 from August 2022 to November 2022 are due December 29, 2022.

Per the Development Agreement, amounts that are more than 30 days late after the due date shall result in a penalty equal to the sum of 25% of the non-operating/operating fees. In addition, a 10% shall be added to the first day of each calendar month following the month of the imposition of the 25% penalty if the fees remain unpaid in whole or in part-up to a maximum of 100% of the fee payable. The City will be enforcing these penalties for amounts due from July 2022 to present, as appliable. No penalties will be imposed on amounts outstanding prior to this date. This will be separately listed on current and future invoice letters provided by the City. Should you wish to avoid penalties, ensure that either amounts payable are paid timely or contact the City to discuss entering into a payment plan on prior amounts outstanding
Please pay no later than December 29, 2022, to avoid any penalties. If you have any questions related to these items, please contact Joshua Calhoun at [email protected].

Sincerely,
Joshua Calhoun, CPA
Finance Director
See supporting detail attached of monthly billings and payments from August 2021 through current.

Page 200 of 241 ends

CBP URBF1 OPFEE OPFEE
Operator Comm Benefit Cost Recovery Non Operating Penalties Outstanding The 420 Club, LLC
September 22, 2021 Letter 2,666.68 20,087.08 815.22 23,568.98

BILLINGS
Aug 2021 761.91 335.18 271.74 1,368.83 Sep 2021 761.91 541.78 271.74 1,575.43 Oct 2021 761.91 351.00 271.74 1,384.65 Nov 2021 761.91 2,723.23 271.74 3,756.88 Dec 2021 761.91 190.65 271.74 1,224.30 Jan 2022 761.91 494.28 271.74 1,527.93 Feb 2022 761.91 1,737.30 271.74 2,770.95 Mar 2022 761.91 935.25 271.74 1,968.90 Apr 2022 761.91 1,103.88 271.74 2,137.53 May 2022 761.91 2,115.39 271.74 3,149.04 Jun 2022 761.91 127.60 271.74 1,161.25 Jul 2022 761.91 924.63 271.74 1,958.28 Aug 2022 761.91 932.38 271.74 67.94 2,033.97 Sep 2022 761.91 2,550.29 271.74 95.11 3,679.05 Oct 2022 761.91 1,914.65 271.74 122.28 3,070.58 Nov 2022 761.91 2,591.48 271.74 149.46 3,774.59

PAYMENTS
Aug 2021
Sep 2021
Oct 2021
Nov 2021
Dec 2021
Jan 2022
Feb 2022
Mar 2022
Apr 2022
May 2022
Jun 2022
Jul 2022
Aug 2022
Sep 2022
Oct 2022
Nov 2022 0.00 0.00 0.00 0.00 0.00
Annual City Reimbursement Costs           72,020.00
Cost per operator (10)             7,202.00
Three years(2019‐2022) 3 years
City Labor           21,606.00        21,606.00
Balance as of November 30, 2022 14,857.24                      61,262.05                  5,163.06        434.78       81,717.13 (a) City Reimbursement cost of $7,202 per year (x three years (2019‐2022)= $21,606.00

Page 201 of 241 ends

P a g e | 1
5220 Santa Ana Street
Cudahy, CA, 90201
Phone: (323) 773-5143
Fax: (323) 771-2072
www.cityofcudahy.com
Mayor
Daisy Lomeli
Vice Mayor
Jose R. Gonzalez
Councilmember
Elizabeth Alcantar
Councilmember
Martin U. Fuentes
Councilmember
Cynthia Gonzalez
City Manager
Alfonso Noyola, ICMA-CM
Incorporated November 10, 1960
January 11, 2023
Via U.S. Mail and Email:

The 420 Club, LLC
Attn: Maria Rosa Ibarra, Manager
4916 Cecilia Street Unit G
Cudahy, CA 90201
Re: DA 18-012C
Dear Owner/Operator:

Below is a summary of past and current amounts due under Development Agreement DA 18-012C for Ordinance No 677, with an Effective date of June 5, 2018.

Fee Type Payment
Amount
Payment Period City
Code
Community Benefit Program $2,666.68
$12,952.47
Outstanding balance through July 31,
2021.

Monthly installments ($761.91) from
August 2021 to December 2022.

CBP
Cost Recovery Fee $20,087.08
$47,096.00
Outstanding balance through July 31,
2021.

City Labor from August 2021 to
December 2022
URBF1
Non-Operating Fee $815.22
$4,619.58
$611.42
Outstanding balance through July 31,
2021.

August 2021 to December 2022
The monthly non-operating fee is
$271.74 (.42 x 647-square footage of
the premises)
Penalties Aug 2022 – Dec 2022
OPFEE
Total Fees $88,848.45 Due January 31, 2023

Page 202 of 241 ends

Cost Recovery Fee
The outstanding Cost Recovery Fee as of July 31, 2021, the City labor, and third-party contractors from August 2021 to December 2022 totaling $67,183.08 are due January 31, 2023.

Non-Operating Fees
The outstanding balance as of July 31, 2021, and the current monthly non-operating fees from August 2021 to December 2022 totaling $5,434.80 are due January 31, 2023.

Late Payment Penalties
Penalties totaling $434.78 from August 2022 to December 2022 are due January 31, 2023 Per the Development Agreement, amounts that are more than 30 days late after the due date shall result in a penalty equal to the sum of 25% of the non-operating/operating fees. In addition, a 10% shall be added to the first day of each calendar month following the month of the imposition of the 25% penalty if the fees remain unpaid in whole or in part-up to a maximum of 100% of the fee payable. The City will be enforcing these penalties for amounts due from July 2022 to present, as appliable. No penalties will be imposed on amounts outstanding prior to this date. This will be separately listed on current and future invoice letters provided by the City. Should you wish to avoid penalties, ensure that either amounts payable are paid timely or contact the City to discuss entering into a payment plan on prior amounts outstanding
Please pay no later than January 31, 2023, to avoid any penalties. If you have any questions related to these items, please contact Joshua Calhoun at [email protected].

Sincerely,
Joshua Calhoun, CPA
Finance Director
See supporting detail attached of monthly billings and payments from August 2021 through current.

Page 203 of 241 ends

CBP URBF1 OPFEE OPFEE
Operator Comm Benefit Cost Recovery Non Operating Penalties Outstanding The 420 Club, LLC
September 22, 2021 Letter 2,666.68 20,087.08 815.22 23,568.98

PAYMENTS
Aug 2021
Sep 2021
Oct 2021
Nov 2021
Dec 2021
Jan 2022
Feb 2022
Mar 2022
Apr 2022
May 2022
Jun 2022
Jul 2022
Aug 2022
Sep 2022
Oct 2022
Nov 2022
Dec 2022 0.00 0.00 0.00 0.00 0.00
Annual City Reimbursement Costs           72,020.00
Cost per operator (10)             7,202.00
Three years(2019‐2022) 3 years
City Labor           21,606.00       21,606.00
Balance as of December 31, 2022 15,619.15                      67,183.08                  5,434.80         611.42       88,848.45 (a) City Reimbursement cost of $7,202 per year (x three years (2019‐2022)= $21,606.00

Page 204 of 241 ends

The 420 Club, LLC
Attn: Maria Rosa Ibarra, Manager
4916 Cecilia Street Unit G
Cudahy, CA 90201
Re: DA 18-012C
Dear Owner/Operator:

Below is a summary of past and current amounts due under Development Agreement DA 18-012C for Ordinance No 677, with an Effective date of June 5, 2018.

Fee Type Payment
Amount
Payment Period City
Code
Community Benefit Program $2,666.68
$13,714.38
Outstanding balance through July 31,
2021.

Monthly installments ($761.91) from
August 2021 to January 2023.

CBP
Cost Recovery Fee $20,087.08
$49,148.25
Outstanding balance through July 31,
2021.

City Labor from August 2021 to
January 2023
URBF1
Non-Operating Fee $815.22
$4.891.32
$815.23
Outstanding balance through July 31,
2021.

August 2021 to January 2023
The monthly non-operating fee is
$271.74 (.42 x 647-square footage of
the premises)
Penalties Aug 2022 – Jan 2023
OPFEE
Total Fees $92,138.16 Due February 28, 2023

Page 205 of 241 ends

Cost Recovery Fee
The outstanding Cost Recovery Fee as of July 31, 2021, the City labor, and third-party contractors from August 2021 to January 2023 totaling $69,235.33 are due February 28, 2023.

Non-Operating Fees
The outstanding balance as of July 31, 2021, and the current monthly non-operating fees from August 2021 to January 2023 totaling $5,706.54 are due February 28, 2023.

Late Payment Penalties
Penalties totaling $815.23 from August 2022 to January 2023 are due February 28, 2023.

Per the Development Agreement, amounts that are more than 30 days late after the due date shall result in a penalty equal to the sum of 25% of the non-operating/operating fees. In addition, a 10% shall be added to the first day of each calendar month following the month of the imposition of the 25% penalty if the fees remain unpaid in whole or in part-up to a maximum of 100% of the fee payable. The City will be enforcing these penalties for amounts due from July 2022 to present, as appliable. No penalties will be imposed on amounts outstanding prior to this date. This will be separately listed on current and future invoice letters provided by the City. Should you wish to avoid penalties, ensure that either amounts payable are paid timely or contact the City to discuss entering into a payment plan on prior amounts outstanding
Please pay no later than February 28, 2023, to avoid any penalties. If you have any questions related to these items, please contact Joshua Calhoun at [email protected].

Sincerely,
Joshua Calhoun, CPA
Finance Director
See supporting detail attached of monthly billings and payments from August 2021 through current.

Page 206 of 241 ends

CBP URBF1 OPFEE OPFEE
Operator Comm Benefit Cost Recovery Non Operating Penalties Outstanding The 420 Club, LLC
September 22, 2021 Letter 2,666.68 20,087.08 815.22 23,568.98

PAYMENTS
Aug 2021
Sep 2021
Oct 2021
Nov 2021
Dec 2021
Jan 2022
Feb 2022
Mar 2022
Apr 2022
May 2022
Jun 2022
Jul 2022
Aug 2022
Sep 2022
Oct 2022
Nov 2022
Dec 2022
Jan 2023 0.00 0.00 0.00 0.00 0.00
Annual City Reimbursement Costs           72,020.00
Cost per operator (10)              7,202.00
Three years(2019‐2022) 3 years
City Labor           21,606.00        21,606.00
Balance as of January 31, 2023           16,381.06          69,235.33                   5,706.54         815.23       92,138.16 (a) City Reimbursement cost of $7,202 per year (x three years (2019‐2022)= $21,606.00

Page 207 of 241 ends

The 420 Club, LLC
Attn: Maria Rosa Ibarra, Manager
4916 Cecilia Street Unit G
Cudahy, CA 90201
Re: DA 18-012C
Dear Owner/Operator:

Below is a summary of past and current amounts due under Development Agreement DA 18-012C for Ordinance No 677, with an Effective date of June 5, 2018.

Fee Type Payment
Amount
Payment Period City
Code
Community Benefit Program $2,666.68
$14,476.29
Outstanding balance through July 31,
2021.

Monthly installments ($761.91) from
August 2021 to February 2023.

CBP
Cost Recovery Fee $20,087.08
$51,652.25
Outstanding balance through July 31,
2021.

City Labor from August 2021 to
February 2023
URBF1
Non-Operating Fee $815.22
$5,163.06
$1,046.21
Outstanding balance through July 31,
2021.

August 2021 to February 2023
The monthly non-operating fee is
$271.74 (.42 x 647-square footage of
the premises)
Penalties Aug 2022 – Feb 2023
OPFEE
Total Fees $95,906.79 Due March 31, 2023

Page 208 of 241 ends

Cost Recovery Fee
The outstanding Cost Recovery Fee as of July 31, 2021, the City labor, and third-party contractors from August 2021 to February 2023 totaling $71,739.33 are due March 31, 2023.

Non-Operating Fees
The outstanding balance as of July 31, 2021, and the current monthly non-operating fees from August 2021 to February 2023 totaling $5,978.28 are due March 31, 2023.

Late Payment Penalties
Penalties totaling $1,046.21 from August 2022 to February 2023 are due March 31, 2023.

Per the Development Agreement, amounts that are more than 30 days late after the due date shall result in a penalty equal to the sum of 25% of the non-operating/operating fees. In addition, a 10% shall be added to the first day of each calendar month following the month of the imposition of the 25% penalty if the fees remain unpaid in whole or in part-up to a maximum of 100% of the fee payable. The City will be enforcing these penalties for amounts due from July 2022 to present, as appliable. No penalties will be imposed on amounts outstanding prior to this date. This will be separately listed on current and future invoice letters provided by the City. Should you wish to avoid penalties, ensure that either amounts payable are paid timely or contact the City to discuss entering into a payment plan on prior amounts outstanding
Please pay no later than March 31, 2023, to avoid any penalties. If you have any questions related to these items, please contact Joshua Calhoun at [email protected].

Sincerely,
Joshua Calhoun, CPA
Finance Director
See supporting detail attached of monthly billings and payments from August 2021 through current.

Page 209 of 241 ends

CBP URBF1 OPFEE OPFEE
Operator Comm Benefit Cost Recovery Non Operating Penalties Outstanding The 420 Club, LLC
September 22, 2021 Letter 2,666.68 20,087.08 815.22 23,568.98

PAYMENTS
Aug 2021
Sep 2021
Oct 2021
Nov 2021
Dec 2021
Jan 2022
Feb 2022
Mar 2022
Apr 2022
May 2022
Jun 2022
Jul 2022
Aug 2022
Sep 2022
Oct 2022
Nov 2022
Dec 2022
Jan 2023
Feb 2023 0.00 0.00 0.00 0.00 0.00
Annual City Reimbursement Costs           72,020.00
Cost per operator (10)             7,202.00
Three years(2019‐2022) 3 years
City Labor           21,606.00        21,606.00
Balance as of February 28, 2023            17,142.97           71,739.33                   5,978.28      1,046.21        95,906.79 (a) City Reimbursement cost of $7,202 per year (x three years (2019‐2022)= $21,606.00

Page 210 of 241 ends

Page | 1

5220 Santa Ana Street
Cudahy, CA, 90201
Phone: (323) 773‐5143
Fax: (323) 771‐2072
www.cityofcudahy.com
Mayor
Daisy Lomeli
Vice Mayor
Jose R. Gonzalez
Councilmember
Elizabeth Alcantar
Councilmember
Martin U. Fuentes
Councilmember
Cynthia Gonzalez
City Manager
Alfonso Noyola, ICMA‐CM
Incorporated November 10, 1960
April 6, 2023
Via U.S. Mail and Email:

The 420 Club, LLC
Attn: Maria Rosa Ibarra, Manager
4916 Cecilia Street Unit G
Cudahy, CA 90201
Re: DA 18‐012C
Dear Owner/Operator:

Below is a summary of past and current amounts due under Development Agreement DA 18‐012C for Ordinance No 677, with an Effective date of June 5, 2018.

Fee Type Payment
Amount
Payment Period City
Code
Community Benefit Program $2,666.68
$15,238.20
Outstanding balance through July 31,
2021.

Monthly installments ($761.91) from
August 2021 to March 2023.

CBP
Cost Recovery Fee $20,087.08
$53,627.33
Outstanding balance through July 31,
2021.

City Labor from August 2021 to
March 2023
URBF1
Non‐Operating Fee $815.22
$5,434.80
$1,304.36
Outstanding balance through July 31,
2021.

August 2021 to March 2023
The monthly non‐operating fee is
$271.74 (.42 x 647‐square footage of
the premises)
Penalties Aug 2022 – March 2023

OPFEE
Total Fees $99,173.67 Due April 30, 2023

Page 211 of 241 ends

Page | 2
Community Benefit Program
The Community Benefit Program (CBP) payment amount is due the first day of each month and is considered late if payment is received on or after the fifth day of the month. All CBP outstanding balance as of July 31, 2021, and current CBP monthly installments from August 2021 to March 2023 totaling $17,904.88 are due April 30, 2023.

Cost Recovery Fee
The outstanding Cost Recovery Fee as of July 31, 2021, the City labor, and third‐party contractors from August 2021 to March 2023 totaling $73,714.41 are due April 30, 2023.

Non‐Operating Fees
The outstanding balance as of July 31, 2021, and the current monthly non‐operating fees from August 2021 to March 2023 totaling $6,250.02 are due April 30, 2023.

Late Payment Penalties
Penalties totaling $1,304.36 from August 2022 to March 2023 are due April 30, 2023.

Per the Development Agreement, amounts that are more than 30 days late after the due date shall result in a penalty equal to the sum of 25% of the non‐operating/operating fees. In addition, a 10% shall be added to the first day of each calendar month following the month of the imposition of the 25% penalty if the fees remain unpaid in whole or in part‐up to a maximum of 100% of the fee payable. The City will be enforcing these penalties for amounts due from July 2022 to present, as appliable. No penalties will be imposed on amounts outstanding prior to this date. This will be separately listed on current and future invoice letters provided by the City. Should you wish to avoid penalties, ensure that either amounts payable are paid timely or contact the City to discuss entering into a payment plan on prior amounts outstanding
Please pay no later than April 30, 2023, to avoid any penalties. If you have any questionsrelated to these items, please contact Joshua Calhoun at [email protected].

Sincerely,
Joshua Calhoun, CPA
Finance Director
See supporting detail attached of monthly billings and paymentsfrom August 2021 through current.

Page 212 of 241 ends

CBP URBF1 OPFEE OPFEE
Operator Comm Benefit Cost Recovery Non Operating Penalties Outstanding The 420 Club, LLC
September 22, 2021 Letter 2,666.68 20,087.08 815.22 23,568.98

PAYMENTS
Aug 2021
Sep 2021
Oct 2021
Nov 2021
Dec 2021
Jan 2022
Feb 2022
Mar 2022
Apr 2022
May 2022
Jun 2022
Jul 2022
Aug 2022
Sep 2022
Oct 2022
Nov 2022
Dec 2022
Jan 2023
Feb 2023
Mar 2023 0.00 0.00 0.00 0.00 0.00
Annual City Reimbursement Costs           72,020.00
Cost per operator (10)             7,202.00
Three years(2019‐2022) 3 years
City Labor           21,606.00        21,606.00
Balance as of March 31, 2023            17,904.88           73,714.41                   6,250.02      1,304.36        99,173.67 (a) City Reimbursement cost of $7,202 per year (x three years (2019‐2022)= $21,606.00

Page 213 of 241 ends

Page | 1

The 420 Club, LLC
Attn: Maria Rosa Ibarra, Manager
4916 Cecilia Street Unit G
Cudahy, CA 90201
Re: DA 18‐012C
Dear Owner/Operator:

Below is a summary of past and current amounts due under Development Agreement DA 18‐012C for Ordinance No 677, with an Effective date of June 5, 2018.

Fee Type Payment
Amount
Payment Period City
Code
Community Benefit Program $2,666.68
$16,000.11
Outstanding balance through July
31, 2021.

Monthly installments ($761.91)
from August 2021 to April 2023.

CBP
Cost Recovery Fee $20,087.08
$55,694.18
Outstanding balance through July
31, 2021.

City Labor from August 2021 to April
2023
URBF1
Non‐Operating Fee $815.22
$5,706.54
$1,576.10
Outstanding balance through July
31, 2021.

August 2021 to April 2023
The monthly non‐operating fee is
$271.74 (.42 x 647‐square footage
of the premises)
Penalties Aug 2022 – April 2023

OPFEE
Total Fees $102,545.91 Due May 31, 2023

Page 214 of 241 ends

Page | 2
Community Benefit Program
The Community Benefit Program (CBP) payment amount is due the first day of each month and is considered late if payment is received on or after the fifth day of the month. All CBP outstanding balance as of July 31, 2021, and current CBP monthly installments from August 2021 to April 2023 totaling $18,666.79 are due May 31, 2023.

Cost Recovery Fee
The outstanding Cost Recovery Fee as of July 31, 2021, the City labor, and third‐party contractors from August 2021 to April 2023 totaling $75,781.26 are due May 31, 2023.

Non‐Operating Fees
The outstanding balance as of July 31, 2021, and the current monthly non‐operating fees from August 2021 to April 2023 totaling $6,521.76 are due May 31, 2023.

Late Payment Penalties
Penalties totaling $1,576.10 from August 2022 to April 2023 are due May 31, 2023.

Per the Development Agreement, amounts that are more than 30 days late after the due date shall result in a penalty equal to the sum of 25% of the non‐operating/operating fees. In addition, a 10% shall be added to the first day of each calendar month following the month of the imposition of the 25% penalty if the fees remain unpaid in whole or in part‐up to a maximum of 100% of the fee payable. The City will be enforcing these penalties for amounts due from July 2022 to present, as appliable. No penalties will be imposed on amounts outstanding prior to this date. This will be separately listed on current and future invoice letters provided by the City. Should you wish to avoid penalties, ensure that either amounts payable are paid timely or contact the City to discuss entering into a payment plan on prior amounts outstanding
Please pay no later than May 31, 2023, to avoid any penalties. If you have any questionsrelated to these items, please contact Joshua Calhoun at [email protected].

Sincerely,
Joshua Calhoun, CPA
Finance Director
See supporting detail attached of monthly billings and paymentsfrom August 2021 through current.

Page 215 of 241 ends

CBP URBF1 OPFEE OPFEE
Operator Comm Benefit Cost Recovery Non Operating Penalties Outstanding The 420 Club, LLC
September 22, 2021 Letter 2,666.68 20,087.08 815.22 23,568.98

PAYMENTS
Aug 2021
Sep 2021
Oct 2021
Nov 2021
Dec 2021
Jan 2022
Feb 2022
Mar 2022
Apr 2022
May 2022
Jun 2022
Jul 2022
Aug 2022
Sep 2022
Oct 2022
Nov 2022
Dec 2022
Jan 2023
Feb 2023
Mar 2023
Apr 2023 0.00 0.00 0.00 0.00 0.00
Annual City Reimbursement Costs           72,020.00
Cost per operator (10)              7,202.00
Three years(2019‐2022) 3 years
City Labor           21,606.00        21,606.00
Balance as of April 30, 2023            18,666.79           75,781.26                   6,521.76      1,576.10     102,545.91 (a) City Reimbursement cost of $7,202 per year (x three years (2019‐2022)= $21,606.00

Page 216 of 241 ends

The 420 Club, LLC
Attn: Maria Rosa Ibarra, Manager
4916 Cecilia Street Unit G
Cudahy, CA 90201
Re: DA 18-012C
Dear Owner/Operator:

Below is a summary of past and current amounts due under Development Agreement DA 18-012C for Ordinance No 677, with an Effective date of June 5, 2018.

Fee Type Payment
Amount
Payment Period City
Code
Community Benefit Program $2,666.68
$16,762.02
Outstanding balance through July
31, 2021.

Monthly installments ($761.91)
from August 2021 to May 2023.

CBP
Cost Recovery Fee $20,087.08
$57,542.73
Outstanding balance through July
31, 2021.

City Labor from August 2021 to May
2023
URBF1
Non-Operating Fee $815.22
$5,978.28
$1,576.10
Outstanding balance through July
31, 2021.

August 2021 to May 2023
The monthly non-operating fee is
$271.74 (.42 x 647-square footage
of the premises)
Penalties Aug 2022 – April 2023
OPFEE
Total Fees $105,428.11 Due June 30, 2023

Page 217 of 241 ends

Cost Recovery Fee
The outstanding Cost Recovery Fee as of July 31, 2021, the City labor, and third-party contractors from August 2021 to May 2023 totaling $77,629.81 are due June 30, 2023.

Non-Operating Fees
The outstanding balance as of July 31, 2021, and the current monthly non-operating fees from August 2021 to May 2023 totaling $6,793.50 are due June 30, 2023.

Late Payment Penalties
Penalties totaling $1,576.10 from August 2022 to April 2023 are due June 30, 2023.

Per the Development Agreement, amounts that are more than 30 days late after the due date shall result in a penalty equal to the sum of 25% of the non-operating/operating fees. In addition, a 10% shall be added to the first day of each calendar month following the month of the imposition of the 25% penalty if the fees remain unpaid in whole or in part-up to a maximum of 100% of the fee payable. The City will be enforcing these penalties for amounts due from July 2022 to present, as appliable. No penalties will be imposed on amounts outstanding prior to this date. This will be separately listed on current and future invoice letters provided by the City. Should you wish to avoid penalties, ensure that either amounts payable are paid timely or contact the City to discuss entering into a payment plan on prior amounts outstanding
Please pay no later than June 30, 2023, to avoid any penalties. If you have any questions related to these items, please contact Joshua Calhoun at [email protected].

Sincerely,
Joshua Calhoun, CPA
Finance Director
See supporting detail attached of monthly billings and payments from August 2021 through current.

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CBP URBF1 OPFEE OPFEE
Operator Comm Benefit Cost Recovery Non Operating Penalties Outstanding The 420 Club, LLC
September 22, 2021 Letter 2,666.68 20,087.08 815.22 23,568.98

PAYMENTS
Aug 2021
Sep 2021
Oct 2021
Nov 2021
Dec 2021
Jan 2022
Feb 2022
Mar 2022
Apr 2022
May 2022
Jun 2022
Jul 2022
Aug 2022
Sep 2022
Oct 2022
Nov 2022
Dec 2022
Jan 2023
Feb 2023
Mar 2023
Apr 2023
May 2023
Jun 2023
Annual City Reimbursement Costs           72,020.00
Cost per operator (10)             7,202.00
Three years(2019‐2022) 3 years
City Labor           21,606.00        21,606.00
Balance as of May 31, 2023            19,428.70           77,629.81                   6,793.50     1,576.10     105,428.11 (a) City Reimbursement cost of $7,202 per year (x three years (2019‐2022)= $21,606.00

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The 420 Club, LLC
Attn: Maria Rosa Ibarra, Manager
4916 Cecilia Street Unit G
Cudahy, CA 90201
Re: DA 18-012C
Dear Owner/Operator:

Below is a summary of past and current amounts due under Development Agreement DA 18-012C for Ordinance No 677, with an Effective date of June 5, 2018.

Fee Type Payment
Amount
Payment Period City
Code
Community Benefit Program $19,428.70
$761.91
$761.91
Outstanding balance as of May 31,
2023.

June 2023 Monthly Fee
July 2023 Monthly Fee
CBP
Cost Recovery Fee $77,629.81
$2,453.28
Outstanding balance as of May 31,
2023.

June 2023 Monthly Fee
URBF1
Non-Operating Fee $6,793.50
$543.48
$1,576.10
Outstanding balance as of May 31,
2023.

June 2023 to July 2023
The monthly non-operating fee is
$271.74 (.42 x 647-square footage
of the premises)
Penalties Aug 2022 – April 2023
OPFEE
Total Fees $109,948.69 Due July 31, 2023

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P a g e | 2
Community Benefit Program
The Community Benefit Program (CBP) payment amount is due the first day of each month and is considered late if payment is received on or after the fifth day of the month. All CBP outstanding balance as of May 31, 2023, and current CBP monthly installments from June 2023 to July 2023 totaling $20,952.52 are due July 31, 2023.

Cost Recovery Fee
The outstanding Cost Recovery Fee as of May 31, 2023, the City labor, and third-party contractors for June 2023 totaling $80,083.09 are due July 31, 2023.

Non-Operating Fees
The outstanding balance as of May 31, 2023, and the current monthly non-operating fees from June 2023 to July 2023 totaling $7,336.98 are due July 31, 2023.

Late Payment Penalties
Penalties totaling $1,576.10 from August 2022 to April 2023 are due July 31, 2023.

Per the Development Agreement, amounts that are more than 30 days late after the due date shall result in a penalty equal to the sum of 25% of the non-operating/operating fees. In addition, a 10% shall be added to the first day of each calendar month following the month of the imposition of the 25% penalty if the fees remain unpaid in whole or in part-up to a maximum of 100% of the fee payable. The City will be enforcing these penalties for amounts due from July 2022 to present, as appliable. No penalties will be imposed on amounts outstanding prior to this date. This will be separately listed on current and future invoice letters provided by the City. Should you wish to avoid penalties, ensure that either amounts payable are paid timely or contact the City to discuss entering into a payment plan on prior amounts outstanding
Please pay no later than July 31, 2023, to avoid any penalties. If you have any questions related to these items, please contact Joshua Calhoun at [email protected].

Sincerely,
Joshua Calhoun, CPA
Finance Director
See supporting detail attached of monthly billings and payments as of July 1, 2023.

Page 221 of 241 ends

CBP URBF1 OPFEE OPFEE
Operator Comm Benefit Cost Recovery Non Operating Penalties Outstanding The 420 Club, LLC
Balance as of May 31, 2023 19,428.70 77,629.81 6,793.50 1,576.10 105,428.11

BILLINGS
Jun 2023 761.91 2,453.28 271.74 ‐ 3,486.93 Jul 2023 761.91 pending 271.74 ‐ 1,033.65 Aug 2023
Sep 2023
Oct 2023
Nov 2023
Dec 2023
Jan 2024
Feb 2024
Mar 2024
Apr 2024
May 2024
Jun 2024

PAYMENTS
Jun 2023
Jul 2023
Aug 2023
Sep 2023
Oct 2023
Nov 2023
Dec 2023
Jan 2024
Feb 2024
Mar 2024
Apr 2024
May 2024
Jun 2024
Balance as of July 1, 2023 20,952.52 80,083.09 7,336.98 ‐ 109,948.69

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Page | 1
5220 Santa Ana Street
Cudahy, CA, 90201
Phone: (323) 773‐5143
Fax: (323) 771‐2072
www.cityofcudahy.com
Mayor
Daisy Lomeli
Vice Mayor
Jose R. Gonzalez
Councilmember
Elizabeth Alcantar
Councilmember
Martin U. Fuentes
Councilmember
Cynthia Gonzalez
City Manager
Alfonso Noyola, ICMA‐CM
Incorporated November 10, 1960
August 15, 2023
Via U.S. Mail and Email:

The 420 Club, LLC
Attn: Maria Rosa Ibarra, Manager
4916 Cecilia Street Unit G
Cudahy, CA 90201
Re: DA 18‐012C
Dear Owner/Operator:

Below is a summary of past and current amounts due under Development Agreement DA 18‐012C for Ordinance No 677, with an Effective date of June 5, 2018.

Fee Type Payment
Amount
Payment Period City
Code
Community Benefit Program $19,428.70
$761.91
$761.91
$761.91
Outstanding balance as of May 31,
2023.

June 2023 Monthly Fee
July 2023 Monthly Fee
August 2023 Monthly Fee
CBP
Cost Recovery Fee $77,629.81
$2,453.28
$428.13
Outstanding balance as of May 31,
2023.

June 2023 Monthly Fee
July 2023 Monthly Fee
URBF1
Non‐Operating Fee $6,793.50
$815.22
$1,576.10
Outstanding balance as of May 31,
2023.

June 2023 to August 2023
The monthly non‐operating fee is
$271.74 (.42 x 647‐square footage
of the premises)
Penalties Aug 2022 – April 2023
OPFEE
Total Fees $111,410.47 Due August 31, 2023

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Page | 2
Community Benefit Program
The Community Benefit Program (CBP) payment amount is due the first day of each month and is considered late if payment is received on or after the fifth day of the month. All CBP outstanding balance as of May 31, 2023, and current CBP monthly installments from June 2023 to August 2023 totaling $21,714.43 are due August 31, 2023.

Cost Recovery Fee
The outstanding Cost Recovery Fee as of May 31, 2023, the City labor, and third‐party contractors from June 2023 to July 2023 totaling $80,511.22 are due August 31, 2023.

Non‐Operating Fees
The outstanding balance as of May 31, 2023, and the current monthly non‐operating fees from June 2023 to August 2023 totaling $7,608.72 are due August 31, 2023.

Late Payment Penalties
Penalties totaling $1,576.10 from August 2022 to April 2023 are due August 31, 2023.

Per the Development Agreement, amounts that are more than 30 days late after the due date shall result in a penalty equal to the sum of 25% of the non‐operating/operating fees. In addition, a 10% shall be added to the first day of each calendar month following the month of the imposition of the 25% penalty if the fees remain unpaid in whole or in part‐up to a maximum of 100% of the fee payable. The City will be enforcing these penalties for amounts due from July 2022 to present, as appliable. No penalties will be imposed on amounts outstanding prior to this date. This will be separately listed on current and future invoice letters provided by the City. Should you wish to avoid penalties, ensure that either amounts payable are paid timely or contact the City to discuss entering into a payment plan on prior amounts outstanding
Please pay no later than August 31, 2023, to avoid any penalties. If you have any questions related to these items, please contact Joshua Calhoun at [email protected].

Sincerely,
Joshua Calhoun, CPA
Finance Director
See supporting detail attached of monthly billings and payments as of August 1, 2023.

Page 224 of 241 ends

CBP URBF1 OPFEE OPFEE
Operator Comm Benefit Cost Recovery Non Operating Penalties Outstanding The 420 Club, LLC
Balance as of May 31, 2023 19,428.70 77,629.81 6,793.50 1,576.10 105,428.11

BILLINGS
Jun 2023 761.91 2,453.28 271.74 ‐ 3,486.93 Jul 2023 761.91 428.13 271.74 ‐ 1,461.78 Aug 2023 761.91 pending 271.74 ‐ 1,033.65 Sep 2023
Oct 2023
Nov 2023
Dec 2023
Jan 2024
Feb 2024
Mar 2024
Apr 2024
May 2024
Jun 2024

PAYMENTS
Jun 2023
Jul 2023
Aug 2023
Sep 2023
Oct 2023
Nov 2023
Dec 2023
Jan 2024
Feb 2024
Mar 2024
Apr 2024
May 2024
Jun 2024
Balance as of August 1, 2023 21,714.43 80,511.22 7,608.72 ‐ 111,410.47

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ATTACHMENT J
Certificate of Status

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Secretary of State
Certificate of Status
I, SHIRLEY N. WEBER, PH.D., California Secretary of State, hereby certify:

Entity Name: THE 420 CLUB, LLC
Entity No.: 201733110010
Registration Date: 11/22/2017
Entity Type: Limited Liability Company - CA
Formed In: CALIFORNIA
Status: Suspended - FTB/SOS
The above referenced entity's powers, rights and privileges are suspended in California.

This certificate relates to the status of the entity on the Secretary of State’s records as of the date of this certificate and does not reflect documents that are pending review or other events that may affect status.

No information is available from this office regarding the financial condition, status of licenses, if any, business activities or practices of the entity.

IN WITNESS WHEREOF, I execute this certificate and affix the Great Seal of the State of California this day of August 02, 2023.

SHIRLEY N. WEBER, PH.D.

Secretary of State
Certificate No.:

To verify the issuance of this Certificate, use the Certificate No. above with the Secretary of State Certification Verification Search available at bizfileOnline.sos.ca.gov. 134619731

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ATTACHMENT K
Notice of Review Hearing

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ATTACHMENT F

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ATTACHMENT F

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ATTACHMENT L

POWERPOINT

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REVIEW HEARING FOR 420 CLUB, LLC.

SEPTEMBER 7, 2023

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REVIEW HEARING
This Review Hearing is being conducted in accordance with the Development Agreement Article 19 as referenced below:
19(c). Special Review. City Council may order a special review of compliance with this Agreement at any time. The Planning Director or his or her designee shall conduct such special review. During a special review, Owner shall be required to demonstrate good faith compliance with the terms of the Agreement. The burden of proof on this issue shall be on Owner.
19(d). Review Hearing. At the time and place set for the review hearing, Owner shall be given an opportunity to be heard. If City Council finds, based upon substantial evidence, that Owner has not complied in good faith with the terms or conditions of this Agreement, City Council may terminate this Agreement notwithstanding any other provision of this Agreement to the contrary, or modify this Agreement and impose such conditions as are reasonably necessary to protect the interests of City. The decision of City Council shall be final, subject only to judicial review pursuant to Code of Civil Procedure Section 1094.5.

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SITE LOCATION
Location: 4916 Cecelia St.

Unit #G
Use: Retail Cannabis Delivery
Other Units
and uses:

Unit A: Cultivation and Manufacturing (Cuper Development LLC) Unit B: Cultivation and distribution (Go Cudahy LLC)
Unit C: Manufacturing (Davina LLC)
Unit D: Distribution (Genius Distribution LLC)
Unit E: Manufacturing (Herbal Dragon LLC)
Unit F: Delivery (Daniel and Goliath)
Zoning: Light Industrial (LI)
Overlay: Urban Agriculture Overlay
Site
Description:

The Site is developed with an approx. 70,000
square foot warehouse building.

Page 234 of 241 ends

TIMELINE/BACKGROUND
2017
City Council approved
medicinal commercial
cannabis uses within the
Urban Agriculture
Overlay.
2018
Planning Commission
and/or City Council
review and issuance of
CCP18-0019 and
execution of DA 18-
012C at 4916 Cecelia
St for cannabis delivery.
2019- Jan 2023
City staff contacted the
Operator several times
during and to cure
defaults on payments,
project schedule of
performance, and
conditions compliance.

April 12, 2023
Final Demand Letter
was sent on April 12,
2023, and no response
to cure defaults was
received within a timely
manner.

Page 235 of 241 ends

VIOLATIONS SUMMARY
Breach of Payment
Obligations
(DA Article 5. b, 7. c and 8)
• The Operator must pay the City’s
annual community benefit fees.
• The Operator has not made the
required payments and as of
August 1, 2023, is past due in the
amount of $111,410.07
Non-compliance with State
Law
(DA Article 4. a)
• 420 Club LLC’s legal status as a
CA limited liability company has
been terminated.

Breach of conditions of
approval under CCP 18-00019
(Conditions of Approval No. 51)
• The Operator has made no effort
to show substantial progress in
compliance with their time limit,
which expired in 2019.
• The City has not received a
Zoning Clearance, TI
Improvements, or obtained a
Certificate of Occupancy to
occupy Unit #G.

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RECOMMENDATION
Staff recommends that the Hearing Officer take the following action(s):

1. Hear the evidence presented by the City; and

2. Make a determination that the Operator is not in compliance with the terms and conditions of its DA with the City and find that the Operator is in default of contractual obligations set forth in the DA and conditions of approval of CCP18-0019; and

3. Make a recommendation to the City Manager for the Planning Commission and City Council to adopt an ordinance repealing Ordinance No. 697 and terminating Development Agreement No. 18-012C and revoking CCP18-0019; and

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ATTACHMENT M
LETTER DATES SEPTEMBER 6, 2023

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The 420 Club, LLC
Attn: Maria Rosa Ibarra, Manager
4916 Cecilia Street Unit G
Cudahy, CA 90201
Re: DA 18-012C
Dear Owner/Operator:

Below is a summary of past and current amounts due under Development Agreement DA 18-012C for Ordinance No 677, with an Effective date of June 5, 2018.

Fee Type Payment
Amount
Payment Period City
Code
Community Benefit Program $19,428.70
$761.91
$761.91
$761.91
$761.91
Outstanding balance as of May 31,
2023.

June 2023 Monthly Fee
July 2023 Monthly Fee
August 2023 Monthly Fee
September 2023 Monthly Fee
CBP
Cost Recovery Fee $77,629.81
$2,453.28
$428.13
$1,066.26
Outstanding balance as of May 31,
2023.

June 2023 Monthly Fee
July 2023 Monthly Fee
August 2023 Monthly Fee
URBF1
Non-Operating Fee $6,793.50
$1,086.96
$1,576.10
Outstanding balance as of May 31,
2023.

June 2023 to September 2023
The monthly non-operating fee is
$271.74 (.42 x 647-square footage
of the premises)
Penalties Aug 2022 – April 2023
OPFEE
Total Fees $113,510.38 Due September 30, 2023

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P a g e | 2
Community Benefit Program
The Community Benefit Program (CBP) payment amount is due the first day of each month and is considered late if payment is received on or after the fifth day of the month. All CBP outstanding balance as of May 31, 2023, and current CBP monthly installments from June 2023 to September 2023 totaling $22,476.34 are due September 30, 2023.

Cost Recovery Fee
The outstanding Cost Recovery Fee as of May 31, 2023, the City labor, and third-party contractors from June 2023 to August 2023 totaling $81,577.48 are due September 30, 2023.

Non-Operating Fees
The outstanding balance as of May 31, 2023, and the current monthly non-operating fees from June 2023 to September 2023 totaling $7,880.46 are due September 30, 2023.

Late Payment Penalties
Penalties totaling $1,576.10 from August 2022 to April 2023 are due September 30, 2023.

Per the Development Agreement, amounts that are more than 30 days late after the due date shall result in a penalty equal to the sum of 25% of the non-operating/operating fees. In addition, a 10% shall be added to the first day of each calendar month following the month of the imposition of the 25% penalty if the fees remain unpaid in whole or in part-up to a maximum of 100% of the fee payable. The City will be enforcing these penalties for amounts due from July 2022 to present, as appliable. No penalties will be imposed on amounts outstanding prior to this date. This will be separately listed on current and future invoice letters provided by the City. Should you wish to avoid penalties, ensure that either amounts payable are paid timely or contact the City to discuss entering into a payment plan on prior amounts outstanding
Please pay no later than September 30, 2023, to avoid any penalties. If you have any questions related to these items, please contact Joshua Calhoun at [email protected].

Sincerely,
Joshua Calhoun, CPA
Finance Director
See supporting detail attached of monthly billings and payments as of September 1, 2023.

Page 240 of 241 ends

CBP URBF1 OPFEE OPFEE
Operator Comm Benefit Cost Recovery Non Operating Fees Penalties Outstanding The 420 Club, LLC
Balance as of May 31, 2023 19,428.70 77,629.81 6,793.50 1,576.10 105,428.11

BILLINGS
Jun 2023 761.91 2,453.28 271.74 ‐ 3,486.93 Jul 2023 761.91 428.13 271.74 ‐ 1,461.78 Aug 2023 761.91 1,066.26 271.74 ‐ 2,099.91 Sep 2023 761.91 pending ‐ 271.74 1,033.65 Oct 2023
Nov 2023
Dec 2023
Jan 2024
Feb 2024
Mar 2024
Apr 2024
May 2024
Jun 2024

PAYMENTS
Jun 2023
Jul 2023
Aug 2023
Sep 2023
Oct 2023
Nov 2023
Dec 2023
Jan 2024
Feb 2024
Mar 2024
Apr 2024
May 2024
Jun 2024
Balance as of September 1, 2023 22,476.34 81,577.48 7,880.46 ‐ 113,510.38

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Napolitano Law + Counsel
Law | Arbitration | Mediation | Adjudication

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DECISION and ORDER
Administrative Hearing Regarding Compliance by The 420 Club LLC (Respondent) with Commercial Cannabis Permit (CCP) 18-0019 and Development Agreement (DA) 18-012C Between Respondent and the City of Cudahy (City)
Hearing Date: September 7, 2023
Hearing Officer: Steve Napolitano, Esq.

Parties appeared via videoconference software. The Hearing was recorded and is available through the City Clerk’s Office.

Respondent: The 420 Club LLC, 4619 Cecilia St., Unit G, Cudahy, CA 90201. Respondent did not appear and was not represented at the hearing.

City was present and represented by:
• Cecilia Madrigal-Gonzalez, Senior Planner.
• Joshua Calhoun, Finance Director
• Juan Arauz, Community Development Director
• Jessica Guillen, Assistant Planner
• Raul Diaz, Building Official
• Glenn Calsada, Special Council
• Paloma McEvoy, City Attorney
• Richard Iglesias, City Clerk

DECISION SUMMARY
Based on the evidence and analysis discussed below, this Hearing Officer finds that a preponderance of the evidence shows that Respondent, despite considerable notice and opportunities to cure any issues, has breached the terms and conditions of DA 18-012C and Respondent’s portion of its CCP and recommends that the Planning Commission and/or City Council repeal Ordinance No. 677 and terminate DA 18-012C and revoke CCP 18-0019.

ADMINISTRATIVE HEARING PROCEDURES
All state and local public entities are subject to due process of law. State agencies are subject to statutory requirements, including the Administrative Procedures Act. Local public agencies are, with some minor exceptions, not subject to the APA and generally subject only to the constitutional limitations of due process of law. Govt. Code §11410.30. While a local agency may elect to apply some or all of the provisions of the APA to its hearings, the City has not done so.

The process required by law are those imposed by our constitution(s) as well as any procedures adopted by the County. In Mohilef v. Janovici (1996) 51 Cal.App.4th 267 and E.W.A.P., Inc. v. City of Los Angeles (1997) 56 Cal.App.4th 310, the court explored what due process is necessary in an administrative proceeding. There is general agreement that there must be notice and an opportunity to be heard. Beyond this, “there is no precise manner of hearing which must be afforded; rather the particular interests at issue must be considered in determining what kind of hearing is appropriate. A formal hearing, with full rights of confrontation and cross-examination is not necessarily required.

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(Saleeby v. State Bar (1985) 39 Cal.3d 547, 565, 216 Cal.Rptr. 367, 702 P.2d 525.) ‘Due process’ is an elusive concept. Its exact boundaries are undefinable, and its content varies according to specific factual contexts.” Mohilef at 286. Our Supreme Court has stated, “[D]ue process may require only that the administrative agency comply with the statutory limitations on its authority.” People v. Ramirez (1979) 25 Cal.3d 260, 269
Beyond notice and a hearing, the procedures available in this case to the participants are those provided by Cudahy Municipal Code (CMC) 5.20.080.

The legal standard of review applicable to an administrative hearing is based on a preponderance of the evidence, or “evidence which is of greater weight and more convincing than the evidence which is offered in opposition to it; that is evidence which as a whole shows that the fact sought to be proved is more probable than not.” Black’s Law Dictionary, Fifth Edition.

BACKGROUND
Background information was presented in the City’s Staff Report dated September 7, 2023, with attachments A through K, which were admitted into evidence. Two additional attachments were provided and admitted into evidence post hearing as discussed below under Procedural Issues.

On September 11, 2017, the City adopted Ordinance No. 673 (Attachment A) establishing the City’s commercial cannabis production activity regulations codified in Chapter 5.20 of the CMC. CMC Section

5.20.040 authorizes medicinal commercial cannabis activities within a designated overlay zone, pursuant to a development agreement adopted in accordance with the Development Agreement Law (Govt. Code Section 65864 et seq.) and Chapter 20.28 of the CMC.

On April 20, 2018, the Planning Commission approved CCP18-0019 for cannabis delivery at 4916 Cecilia St., subject to the approval of a development agreement between the City and Respondent for cannabis delivery.

On May 15, 2018, the City Council adopted Resolution No. 18-17 (Attachment B) approving the issuance of Commercial Cannabis Permit No. CCP18-0019 with conditions of approval to the Respondent upon the execution of a development agreement with the City.

On June 5, 2018, the City Council adopted Ordinance No. 677 (Attachment C) approving Development Agreement No. 18-012C between Respondent and the City authorizing non-store front commercial cannabis delivery activities at 4916 Cecelia Street Unit #G (“Site”). The Respondent is one of seven tenants at the Site which all have separate development agreements with the City but fall under the same CCP conditions of approval.

On October 19, 2021, the City sent Respondent a final notice of default (Attachment D) with a balance of $21,119.92 through July 16, 2021. The Respondent did not respond and failed to make any attempt to cure the default.

On October 27, 2022, the City sent the Respondent a notice (Attachment E) to act on their intention to complete their project and outstanding compliance issues. The Respondent did not respond and failed to cure the default in a timely manner.

On or around January 2023, the City spoke with Respondent to discuss transfer membership interests in Respondent. On February 17, 2023 (Attachment F) the City sent the Respondent a notice to provide ATTACHMENT G Page 2721 of 3559
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adequate documentation for the transfer and to immediately address Respondent’s LLC entity status with the State. Respondent did not respond and failed to cure the default in a timely manner.

On April 12, 2023, the City sent a final demand letter (Attachment G) demanding the Respondent to respond to the following demands: 1) Amend the operating agreement for the LLC to show the addition of new members; 2) Amend the operating agreement made by a resolution of the LLC adding in the new members; 3) Proof of revival of the LLC’s entity status with the State; 4) Forwarding payment for all past due amounts or enter into a repayment arrangement; and 5) Contact the City to revise the CCP’s Schedule of Performance. Respondent did not respond in a timely manner and has failed to make any attempt to cure the defaults.

By letter dated August 8, 2023, the City certified mailed Respondent a notice of this administrative hearing, notifying Respondent of the time and place of the hearing, as well as other information, including a request for Respondent to respond to the City Clerk’s office within 10 days of the date of the letter to confirm their appearance at the administrative hearing. Respondent did not provide a response to the notice and did not confirm their attendance at the hearing and submitted no evidence on their own behalf.

PROCEDURAL ISSUES
As noted, Respondent did not participate and was not represented at the hearing. No evidence was submitted by Respondent.

Evidence submitted prior to the hearing by City staff and testimony and statements made at the hearing by City staff are incorporated herein by reference, including the City’s staff report dated September 7, 2023, with attachments A through K, which were admitted into evidence. At the conclusion of the hearing, the Hearing Officer asked City Staff to supplement their report by adding the power point presentation given at the hearing as Attachment L and an updated billing of the total monthly payments due from Respondent as of September 6, 2023 as Attachment M.

Pursuant to CMC 5.20.080(6), the City Manager or his designee may determine if a Cannabis Permittee has failed to comply with any condition, agreement, or covenant with the City. In the event of any material violation, the City Manager or his designee may suspend or revoke a cannabis permit.

Under section 19 of Respondent’s DA, the City may conduct Periodic and Special Reviews of Respondent’s “good faith compliance with the terms of the Agreement,” noting that the burden of proof is on the Owner [Respondent]. In the event of a finding of noncompliance, the City Manager may report the matter to the Planning Commission and City Council with recommended actions. The City Council may terminate the Agreement or impose such conditions as are reasonably necessary to protect the interests of the City.

The City engaged this Hearing Officer to conduct an impartial, independent review of the evidence in this matter and determine whether Respondent is in compliance with its CCP and DA between itself and the City.

No objections or other procedural issues were raised.

Presenting City Staff members were sworn in prior to giving testimony.

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EVIDENCE
Community Development Director Juan Arauz testified on behalf of the City regarding the timeline laid out in the Staff Report discussed above.

Special Counsel Glenn Calsada then testified that the City has made efforts over several years to get Respondent into compliance. Respondent holds one of seven DAs approved at their location for retail delivery. Respondent had a difficult time complying with their requirements. Mr. Calsada stated that Respondent is in default and their status as an LLC was suspended. He further testified that the former husband of the current owner of Respondent business died, and the widowed owner was inexperienced in the cannabis business and sought out partners to take over Respondent’s operations and gain compliance with their DA. However, Respondent has made no known progress in becoming compliant, as they have been nonresponsive, in arrears on their required payments, and their business entity was suspended by the State. Multiple letters have been sent to Respondent regarding these matters without response, leading the City to call for this hearing to have the Hearing Officer review the evidence and determine whether these violations are material breaches of their CCP and DA that support termination of Respondent’s DA and Respondent’s portion of the CCP, of which several other entities are currently operating under at the same site.

City Finance Director Joshua Calhoun testified to Respondent’s failure to make their required payments to the City, noting the invoices in Attachment I that remain unpaid by Respondent and which total in excess of $100,000. The City has since provided the Hearing Officer, post hearing, with the most up-todate invoice sent to Respondent as of September 6, 2023 which states a total payment due of $113,510.38 (Attachment M). These amounts reflect the failure of Respondent to make the monthly payments required under their CCP and/or their DA.

City Building Official Raul Diaz testified that Respondent had 180 days from the approval of their CCP/DA to complete required improvements to their building site but failed to do so, stating that there is no evidence of completion, no inspections have been made or requested and no extensions requested either. As a result, Respondent does not have a certificate of occupancy to operate out of their business location and the time to gain compliance has lapsed. City made a final request for compliance in their Final Demand letter dated April 12, 2023 (Attachment G to City).

City Clerk Richard Iglesias testified that the documents attached to the September 7, 2023 Staff Report are true and correct copies, and that they are current records that have not been amended.

Community Development Director Arauz asked the Hearing Officer to make the recommended findings to repeal and revoke Respondent’s portion of the CCP and their DA in its entirety based on the City’s staff report and the testimony by City staff at the hearing.

ANALYSIS
Pursuant to the CMC 5.20.080(6)(a), “Any material violations of this chapter or any other relevant city law by a cannabis permittee, or cannabis permittee’s agent, is grounds for suspending or revoking the relevant cannabis permit.” To suspend or revoke a cannabis permit the City Manager or the City Manager’s Designee [Hearing Officer] must determine “that the cannabis permittee has failed to comply with any conditions of approval, or any agreement or covenant as required pursuant to this chapter” (CMC 5.20.080(6)(a)).

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The City asserts that Respondent has made several material violations of the CCP and/or DA as outlined in the City’s Staff Report and testimony, which will be discussed as follows.

1. Breach of Payment Obligations
Pursuant to the DA Article. 5.b (Community Benefit Fees), Article. 7.c (Operating Fees) and Article. 8 (Cost Recovery Fees), the Respondent must pay the City an annual community benefit fee in the amount of $9,523.86 ($1,904.77 down payment and monthly payments in the amount of $761.91), a cost recovery fee, and an operating [or non-operating] fee each year since 2018. The Respondent has not made the required payments and as of September 1, 2023, and is past due in the amount of $113,510.38 per supplemental Attachment M. Past-due payments continue to accumulate, including late payment penalties.

On June 5, 2018, the 420 Club, LLC executed Development Agreement No. 18-012C, which is a legally binding contract between the 420 Club, LLC and the City of Cudahy pursuant to DA Art. 5.b [Community Benefit Fees], Art. 7.c [Operating Fees] Art. 8 [Cost Recovery Fees]. In December 2022 (Attachment H), the City offered a deferment and payment plan option to the Respondent but no interest was received. The City continued to issue monthly invoices from the period of October 2022 to August 2023 (Attachment I), which are now due and payable. Proper notice of default was given with the opportunity to cure, but the Respondent has failed to fulfill its monetary obligations owed to the City.

Based on the evidence provided by the City above, and the failure of Respondent to provide any evidence to the contrary, a preponderance of the evidence shows that Respondent has breached the terms of DA No. 18-012C by failing to make all required payments to the City as required under DA No. 18-012C.

Similarly, Condition of Approval 1(b) under DA No. 18-012C provides that the Respondent is required to pay all City-issued invoices within 30 days of receipt thereof. The City has sent the Respondent regular monthly invoices since October 2022. The current outstanding fees owed by the Respondent have been owed to the City for longer than 30 days as shown in Attachment I. Despite demand and after proper notice of default and opportunity to cure, Respondent has failed to cure its monetary obligations owed to the City.

Based on the evidence provided by the City, and the failure of Respondent to provide any evidence to the contrary, a preponderance of the evidence shows that Respondent failed to comply with Conditions of Approval No. 1(a) and (b) of the CCP, which required the Respondent to pay all City-issued invoices within 30 days of receipt.

Additionally, under Condition of Approval No. 45, Respondent’s failure to make its required payments constitutes a cross-breach of DA No. 12-012C.

2. Noncompliance with State Law
Under DA Art. 4.a. [Facility Operations], Respondent must be a lawful entity capable of operating in accordance with a state-issued cannabis license at all times.

Attachment G shows the Certificate of Status with the Secretary of State of California dated August 2, 2023. The Certificate of Status for the 420 Club, LLC states: “The above-referenced entity’s powers, rights and privileges are suspended in California.” Despite notice of default and opportunity to cure, ATTACHMENT G Page 2724 of 3559
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Respondent’s entity status remains “FTB/SOS” suspended by the California Secretary of State and, as such, the entity is unable to operate in the State of California.

According to the California Franchise Tax Board website, a suspended entity cannot do business in California until they cure the reason for their suspension.

Based on the evidence provided by the City, and the failure of Respondent to provide any evidence to the contrary, a preponderance of the evidence shows that Respondent is not a current legal entity capable of operating in California in violation of DA Art. 4.a.

3. Breach of Conditions of Approval No. 51 (Time Limits) Under CCP 18-0019 CCP Condition No. 51.A. states the approval decision for this CCP becomes effective upon the expiration of the 15-day appeal period following the approval decision, or when any appeals of the decision are finally resolved. The CCP effective date for Respondent’s DA was June 20, 2018. No appeal was ever filed and thus CCP Condition No. 51.A.i sets a 90-day time limit from the effective date of the CCP for the Permittee/Respondent to obtain a Zoning Clearance. CCP Condition No. 51A.ii sets a 90-day time limit from the effective date of the CCP for the Permittee/Respondent to complete construction of Phase I. CCP Condition No. 51A.iii sets a 180-day time limit from the effective date of the CCP for the Permittee/Respondent to complete all Tenant Improvements and construction and to obtain a Certificate of Occupancy from the City Building Department. The City Manager may grant an extension of time if the Permittee/Respondent has made a diligent effort to implement the Project.

Here, Respondent has not provided the City with any evidence it has obtained a Zoning Clearance, completed construction of Phase I, completed all Tenants Improvements, or obtained a Certificate of Occupancy for the Site within the time limits set forth in Condition of Approval No. 51. Without an extension, the deadlines expired in 2019. The City has no record of any request by the Respondent for an extension of time by the City Manager and there is no evidence the Respondent has made substantial progress such as submitting for a zoning clearance or submitting for a building permit plan check.

Respondent was given notice of default and an opportunity to cure by the City’s Final Demand letter dated April 12, 2023 with no response from Respondent.

Based on the evidence provided by the City, and the failure of Respondent to provide any evidence to the contrary, a preponderance of the evidence shows that Respondent has failed to meet its conditions of approval for CCP18-0019 by failing to implement the Project within the time limits set forth in Conditions of Approval No. 51.

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DECISION AND ORDER
Based on the evidence and analysis discussed above, this Hearing Officer finds that a preponderance of the evidence shows that Respondent, despite considerable notice and opportunities to cure any issues, has breached the terms and conditions of DA 18-012C and Respondent’s portion of its CCP and recommends that the Planning Commission and/or City Council repeal Ordinance No. 677 and terminate DA 18-012C and revoke CCP 18-0019.

This decision does not affect the payments and penalties outlined in the City’s Staff Report, which are still owed and due to City from Respondent.

Submitted September 25, 2023 by Steve Napolitano, Esq., Administrative Hearing Officer.

Steve Napolitano, Esq.

Napolitano Law & Counsel
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Public Hearing - Repeal Ordinance and DA - Page 1 of 2
Long Beach Press-Telegram
5150 E. Pacific Coast Highway Suite 200
Long Beach, California 90804
(562) 499-1236
City of Cudahy
5220 Santa Ana Street
Cudahy, California 90201
FILE NO. 0011678076

PROOF OF PUBLICATION
(2015.5 C.C.P.)

STATE OF CALIFORNIA
County of Los Angeles
I am a citizen of the United States and
a resident of the County aforesaid; I
am over the age of eighteen years, and
not party to or interested in the aboveentitled matter. I am the principal clerk of the printer of Long Beach PressTelegram, a newspaper of general circulation, printed and published in the
City of Long Beach*, County of Los
Angeles, and which newspaper has
been adjudged a newspaper of general
circulation by the Superior Court of the
County of Los Angeles, State of
California, under the date of March 21,
1934, Case Number 370512. The
notice, of which the annexed is a
printed copy, has been published in
each regular and entire issue of said
newspaper and not in any supplement
thereof on the following dates, to wit:
06/28/2024
I certify (or declare) under the penalty
of perjury that the foregoing is true and
correct.

Executed at Long Beach, California,
this 28th day of June, 2024.
______________________________
Signature
*Long Beach Press-Telegram, a newspaper of general circulation, is delivered to and available in but not limited to the following cities: Long Beach, Lakewood, Bellflower, Cerritos, Downey, Norwalk, Artesia, Paramount, Wilmington, Compton, South Gate, Los Alamitos, Seal Beach, Cypress, La Palma, Lynwood, San Pedro, Hawaiian Gardens, and Signal Hill.

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Public Hearing - Repeal Ordinance and DA - Page 2 of 2
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Page | 1
5220 Santa Ana Street
Cudahy, CA, 90201
Phone: (323) 773-5143
Fax: (323) 771-2072
www.cityofcudahy.com
Mayor
Jose R. Gonzalez
Vice Mayor
Elizabeth Alcantar
Councilmember
Martin U. Fuentes
Councilmember
Cynthia Gonzalez, Ed. D
Councilmember
Daisy Lomeli
City Manager
Alfonso Noyola, ICMA-CM
Incorporated November 10, 1960
June 13, 2024
Via U.S. Mail and Email:

The 420 Club, LLC
Attn: Maria Rosa Ibarra, Manager
4916 Cecilia Street Unit G
Cudahy, CA 90201
Re: DA 18-012C
Dear Owner/Operator:

Below is a summary of past and current amounts due under Development Agreement DA 18-012C for Ordinance No 677, with an Effective date of June 5, 2018.

Fee Type Payment
Amount
Payment Period City
Code
Community Benefit Program $19,428.70
$9,904.83
Outstanding balance as of May 31,
2023.

June 2023 – June 2024
($761.91 Monthly Fees)
CBP
Cost Recovery Fee $77,629.81
$24,568.91
($14,950.50)
$6,933.62
Outstanding balance as of May 31,
2023.

June 2023 to May 2024
Reimbursement Expense Credit applied on
October 24, 2023.

Escrow Deposit Beginning Charge
URBF1
Non-Operating Fee $6,793.50
$3,532.62
$5,380.45
Outstanding balance as of May 31,
2023.

June 2023 to June 2024
The monthly non-operating fee is
$271.74 (.42 x 647-square footage
of the premises)
Penalties Aug 2022 – June 2024
OPFEE
Total Fees
Escrow Deposit Beginning Charge
$132,288.32
$6,933.62
Due July 1, 2024
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Community Benefit Program
The Community Benefit Program (CBP) payment amount is due the first day of each month and is considered late if payment is received on or after the fifth day of the month. All CBP outstanding balance as of May 31, 2023, and current CBP monthly installments from June 2023 to June 2024 totaling $29,333.53 are due July 1, 2024.

Cost Recovery Fee
The outstanding Cost Recovery Fee as of May 31, 2023, the City labor, and third-party contractors from June 2023 to May 2024 totaling $87,248.22 are due July 1, 2024.

Escrow Account
Effective September 15, 2023, the City will require The 420 Club, LLC to make an upfront payment of assessed quarterly fees into a deposit to open an escrow account to obtain timely payment of those fees. By this invoice, the Department of Finance is informing you that your beginning charge of your escrow deposit is $6,933.62 This beginning charge of your escrow deposit is based on the average amount of cost recovery fees from July 2022 to June 2023 ($27,734.47) and it will be used to repay fees assessed by the City on a monthly basis beginning in the fourth quarter of 2023 and escrow will be replenished quarterly, as needed. Please see attached worksheet.

Non-Operating Fees
The outstanding balance as of May 31, 2023, and the current monthly non-operating fees from June 2023 to June 2024 totaling $10,326.12 are due July 1, 2024.

Late Payment Penalties
Penalties totaling $5,380.45 from August 2022 to June 2024 are due July 1, 2024.

Per the Development Agreement, amounts that are more than 30 days late after the due date shall result in a penalty equal to the sum of 25% of the non-operating/operating fees. In addition, a 10% shall be added to the first day of each calendar month following the month of the imposition of the 25% penalty if the fees remain unpaid in whole or in part-up to a maximum of 100% of the fee payable. The City will be enforcing these penalties for amounts due from July 2022 to present, as appliable. No penalties will be imposed on amounts outstanding prior to this date. This will be separately listed on current and future invoice letters provided by the City. Should you wish to avoid penalties, ensure that either amounts payable are paid timely or contact the City to discuss entering into a payment plan on prior amounts outstanding
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Please pay no later than July 1, 2024, to avoid any penalties. If you have any questions related to these items, please contact Joshua Calhoun at [email protected].

Sincerely,
Joshua Calhoun, CPA
Finance Director

See supporting detail attached of monthly billings and payments as of June 4, 2024, along with escrow deposit beginning balance worksheet.

ATTACHMENT J Page 2745 of 3559
CBP URBF1 OPFEE OPFEE
Operator Comm Benefit Cost Recovery Non Operating Fees Penalties Outstanding The 420 Club, LLC
Balance as of May 31, 2023 19,428.70 77,629.81 6,793.50 - 103,852.01 Penalties from Aug 2022 -May 2023 1,847.83 1,847.83

BILLINGS
Jun 2023 761.91 2,453.28 271.74 271.74 3,758.67
Jul 2023 761.91 428.13 271.74 271.74 1,733.52
Aug 2023 761.91 3,976.86 271.74 271.74 5,282.25
Sep 2023 761.91 1,884.98 271.74 271.74 3,190.37
Oct 2023 761.91 2,025.67 271.74 271.74 3,331.06
Nov 2023 761.91 910.75 271.74 271.74 2,216.14
Dec 2023 761.91 3,417.45 271.74 271.74 4,722.84
Jan 2024 761.91 4,206.47 271.74 271.74 5,511.86
Feb 2024 761.91 1,180.32 271.74 271.74 2,485.71
Mar 2024 761.91 926.00 271.74 271.74 2,231.39
Apr 2024 761.91 1,199.41 271.74 271.74 2,504.80
May 2024 761.91 1,959.59 271.74 271.74 3,264.98
Jun 2024 761.91 pending 271.74 271.74 1,305.39

PAYMENTS
Jun 2023
Jul 2023
Aug 2023
Sep 2023
Oct 2023
Nov 2023
Dec 2023
Jan 2024
Feb 2024
Mar 2024
Apr 2024
May 2024
Jun 2024
Expense Reimbursement - 10-2023 (14,950.50) (14,950.50) Balance as of June 4, 2024 29,333.53 87,248.22 10,326.12 5,380.45 132,288.32 ATTACHMENT J Page 2746 of 3559
Operator
The 420 Club, LLC
As of September 15, 2023 $ 6,933.62
Sep-23 $ 6,933.62
Oct-23
Nov-23
Dec-23
Jan-24
Feb-24
Mar-24
Apr-24
May-24
Jun-24
Total as of June 4, 2024 $ 6,933.62
Escrow Beginning
Balance
Billings Deposits to
Escrow Account
Cost Recovery
Monthly Fees
Escrow Ending
Balance
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“Serving The People” "Sirviendo A La Comunidad"
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07/16/2024 Page 1 of 16

STAFF REPORT
Date: July 16, 2024
To: Honorable Mayor and City Council Members
From: Alfonso Noyola, City Manager
By: Juan Arauz, AICP, Community Development Director
Prepared by: Jessica Guillen, Assistant Planner
Reviewed by: Cecilia Madrigal-Gonzalez, Senior Planner and Paloma McEvoy, Assistant City Attorney
Subject: Introduction and Adoption by First Reading of Ordinance No. 754 repealing Ordinance No. 701, terminating Development Agreement No. 18-014C between the City of Cudahy and Starcraft, LLC.

RECOMMENDATION
City staff recommends that the City Council take the following action(s):

1. Open the public hearing and receive public comment and testimony; and

2. Make a determination that Starcraft, LLC (“Operator”) is not in compliance with the terms and conditions of Development Agreement (“DA”) No. 18-014C and find that the Operator is in default of contractual obligations set forth in the DA; and

3. Introduce and adopt by first reading Ordinance No. 754 (Attachment A) repealing Ordinance No. 701 terminating DA No. 18-014C between the City and Starcraft, LLC; and

4. Schedule the second reading of Ordinance No. 754 at the next regularly scheduled meeting on August 20, 2024; and

5. Determine that these actions are exempt from the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines Section 15321 (Enforcement Actions by Regulatory Agencies).

Item Number
13E

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SUMMARY
Pursuant to the terms and conditions of DA No. 18-014C and Commercial Cannabis Permit (“CCP”) No. 18-0014, it is the City’s purpose and intent to regulate cannabis activities within the City in a responsible manner to protect the health, safety, and welfare of the residents of Cudahy and to enforce rules and regulations consistent with California’s cannabis laws. Cannabis operators with development agreements are obligated to comply with all provisions of the Cudahy Municipal Code (“CMC”), obligations of the DA, and conditions of approval under the CCP, and applicable state and local laws and related regulations. This report provides a summary of the unrefuted evidence offered at an administrative review hearing; a decision by a thirdparty hearing officer (“Hearing Officer”) finding the Operator in default of the DA and out of compliance with the CCP; the public hearing by the Planning Commission, determining that the Operator has failed to comply with the terms and conditions of its DA, despite being provided with ample notice and several opportunities to achieve compliance, thereby recommending to the City Council that it repeal Ordinance No. 701 and DA No. 18-014C through the adoption of Planning Commission Resolution No. 2024-15. Therefore, City staff recommends the City Council adopt Ordinance No. 754 repealing Ordinance No. 701 terminating DA No. 18-014C.

BACKGROUND

1. On September 11, 2017, the City adopted Ordinance No. 673 (Attachment B) establishing the City’s commercial cannabis production activity regulations codified in Chapter 5.20 of the Cudahy Municipal Code (“CMC”). CMC Section 5.20.040 authorizes medicinal commercial cannabis activities within a designated overlay zone, pursuant to a development agreement adopted in accordance with the Development Agreement Law (Govt. Code Section 65864 et seq.) and Chapter 20.28 of the CMC.

2. On November 19, 2018, the Planning Commission conducted a properly noticed public hearing to consider a commercial cannabis permit application for cannabis cultivation, at 4925 Cecelia Street (“Subject Site”) shown in Figure 1, below. On a 2-1 vote, the Planning Commission continued the item to a date uncertain.

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Figure 1 – Aerial of the Subject Site

3. On December 4, 2018, the City Council adopted Resolution No. 18-57 to hear an application for a development agreement by Operator. The City Council also instructed the Planning Commission to make a final decision and recommend to the City Council regarding the CCP no later than December 17, 2018. The minutes are provided in Attachment C.

4. On December 4, 2018, the City Council introduced and conducted the first reading to adopt Ordinance No. 701 (Attachment D) approving DA No. 18-014C (Attachment F – pp. 77-119) inclusive of Exhibits A-F (Attachment F, pp. 132-161) between Operator and the City authorizing commercial cannabis manufacturing and distribution activities at the Subject Site as illustrated in Figures 2 and 3, below. The City Council minutes are provided in Attachment C. The CCP and the DA require the Operator to make timely payments for Community Benefit Fees; Cost Recovery Fees; and Non-Operating Fees.1

5. On December 17, 2018, the Planning Commission recommended the City Council approve DA No. 18-014C and subsequently approved the issuance of CCP No. 18-0014.

6. On December 18, 2018, the City Council approved and issued the CCP No. 18-0014 to the Operator and conducted the second reading to adopt Ordinance No. 701 (Attachment D) approving DA No. 18-014C (Attachment F, pp. 77-119) inclusive of Exhibits A-F (Attachment F, pp. 135-164) between Operator and the City authorizing commercial cultivation activities at the Subject Site as illustrated in Figures 2 and 3, below. The City Council minutes are provided in Attachment L. The CCP and the DA require the Operator 1 As used herein, the term Non-Operating Fees and Operating Fees are used interchangeably.

Site
4925 Cecelia Street

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to make timely payments for Community Benefit Fees; Cost Recovery Fees; and NonOperating Fees.2 Figure 2 – Floor Plan
Figure 3 – Site Plan

7. On October 2, 2019, the City provided the Operator with a Notice of Delinquency (Attachment F, p. 166) due to failure to pay the various fees due under CCP No. 18-0014 and DA No. 18-014C, prior to placing the Operator in default status due to payment non2 As used herein, the term Non-Operating Fees and Operating Fees are used interchangeably.

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compliance, inclusive of the non-payment of Community Benefit Fees, Cost Recovery Fees, and Non-Operating Fees in the amount of $55,305.25. The Operator was given no later than October 17, 2019, to cure the amount, however, the delinquency was not timely cured.

8. On March 22, 2021, the City provided the Operator with a Monthly Operating Fees, Community Benefit Fees, and Cost Recovery Fees (Attachment F, pp. 289-290), which is a summary statement providing the Operator all past due amounts under the DA and CCP, in the amount of $200,368.48.

9. On May 4, 2021, the City provided the Operator with a Notice of Default (Attachment F, pp. 168-169) due to non-compliance with the payment of fees (Community Benefit Fees, Cost Recovery Fees, and Non-Operating Fees) and associated penalties in the amount of $200,368.48. The Operator was given no later than 30 days to cure the default, however, the default was not timely cured.

10. On August 3, 2021, the Building and Safety Division issued Permit No. 8308 (Attachment F, pp. 171-174) for an electrical permit panel and circuit, installation of exterior metal panels, interior demolition and tenant improvements.

11. On October 19, 2021, the City provided the Operator with a Final Demand Letter (Attachment F, pp. 176-177) due to payment non-compliance informing the Operator that Community Benefit Fees, Cost Recovery Fees, Non-Operating Fees and any applicable penalties had accumulated to $240,179.48. This letter included a list of prior efforts by the City to achieve compliance. The Operator was given no later than 30 days to cure the default and comply with payment obligations, however, the default was not timely cured.

12. Pursuant to City Council direction, on December 7, 2022, the City Manager offered a Deferment and Payment Program (Attachment F, pp. 179-180) to assist cannabis operators with accumulated Community Benefit, Cost Recovery and Non-Operating Fees by deferring and providing additional time for payment without penalty. Under the program:
a. Unpaid Non-Operating Fees would be deferred (without penalty) until six (6) months after the Operator was issued a Certificate of Occupancy, and then repay already accumulated Non-Operating Fees within 12 months; and
b. Operators would continue to be responsible for the timely payment of Community Benefit Fees and Cost Recovery Fees, as they accumulated; and c. Previously incurred Community Benefit Fees and Cost Recovery Fees would be subject to a payment plan and require timely payments.

All cannabis operators that were interested in participating in the program were given no later than January 31, 2023, to execute an agreement and participate in the Deferment and Payment Program. The City received interest from the Operator and due to the good faith negotiations between both parties, the City extended the opportunity for the

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Operator to participate.

13. From January 2022 through November 2022, the City’s Building & Safety Division received the following plan check submittals and/or issued building permits for the Subject Site:
• On January 4, 2022, the Operator submitted building permit plans for interior tenant improvements at the Subject Site to the City’s Plan Check Consultants as demonstrated in Figures 4 and 5, below (See also Attachment F, pp. 182-217). These plans did not conform to the original site plan and floor plan approved by the City as shown in Figures 2 and 3 above, and showed 200 square feet of cannabis distribution activities which were outside of the scope of the approved activities at the Subject Site (See also, Attachment F, pp. 182). These plans were submitted without first obtaining a Zoning Clearance from the Planning Division as required by the CCP and DA. Additionally, the Operator was required to submit all required plan check fees but failed to do so. The plan check submittal received approval on October 10, 2022. The Operator was authorized by the City for commercial cannabis cultivation activities only. Pursuant to Condition of Approval 17, prior to undertaking any operational or construction-related activity that is not expressly described in the CCP conditions, the Operator shall first contact the City Manager, or his designee, to determine if the proposed activity requires a modification of their CCP. The City has no record of having received any proposed changes to the Operator’s site plan and floor plan for the Subject Site.

Figure 4 – Non-Conforming Floor Plan
Figure 5 - Non-Conforming Site Plan

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• Plumbing Permit (Installation of new toilet, sinks, vents, drains and rough plumbing) issued by the City’s Building & Safety Division on February 9, 2022 (Attachment F, p. 174).
• Building Permit No. 8548 (Installation of metal panels on the exterior of the facility) issued by the City’s Building & Safety Division on May 4, 2022 (Attachment F, p. 172). • Building Permit No. 8451 (Demolition of interior partition walls) issued by the City’s Building & Safety Division on November 4, 2022 (Attachment F, p. 173).

14. As of January 31, 2023, Operator had accumulated a total outstanding balance of $421,098.98 for “substantial past due fees and costs owed to the City despite prior notice and opportunity to cure” (Attachment F, p. 219).

On February 1, 2023, the City presented the Operator with a Letter Agreement agreeing to the Deferment and Payment Program to forbear the outstanding payments due (“Letter Agreement”) pursuant to the terms of the Deferment and Payment Program described above (Attachment F, pp. 219-226). The Letter Agreement stated that the Operator had an outstanding balance of $421,098.98 in past due fees. By signing the Letter Agreement, the Operator also acknowledged and agreed “that the past due amounts stated are true and correct and are in fact presently due and owing. The parties agree that the Operator is in ‘default status’ on its obligations under the Development Agreement with the City… [and would] remain in ‘default status’ on its Development Agreement until all past due fees set forth in [the] Letter Agreement have been paid and Operator is in full compliance with all terms of its Development Agreement” (Attachment F, pp. 221-222). Pursuant to the terms of the Letter Agreement, the Operator agreed to maintain current payments for Community Benefit Fees and Cost Recovery Fees as they become due under the Development Agreement, effective March 1, 2023, and to commence a 12-month payment schedule for past-due Community Benefit Fees and Cost Recovery Fees beginning April 1, 2023. As stated above, all past due and accruing Non-Operating Fees were deferred until six months after the Operator was first issued a Temporary Certificate of Occupancy.

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15. The Operator accepted the proposed terms and executed the Letter Agreement on February 2, 2023.

16. Between April and June 2023, the City provided the Operator with three Notices of Delinquency (Attachment F, pp. 228-242) under the Letter Agreement and provided an opportunity for the Operator to cure outstanding payments due. However, the default on the Letter Agreement was not timely cured and therefore was terminated and no longer in full force and effect as of June 16, 2023. Accordingly, the total of all past due amounts at the time the Letter Agreement was terminated and an amount of $470,049.49 was due and owing (Attachment F - pp. 244-246).

17. On June 23, 2023, the City sent a Final Demand Letter (Attachment E) demanding the Operator to respond to the following demands: 1) Proof of revival of the LLC’s entity status with the State; 2) Forwarding payment for all past due amounts; and 3) Contact the City to revise the CCP’s Schedule of Performance and for further information to become compliant with the DA and CCP. The Final Demand Letter provided 30 days for the Operator to comply, so that no further action would be necessary. The Operator did not respond in a timely manner and has failed to make any attempt to cure the defaults.

18. On August 9, 2023, the City issued an Escrow Account Letter (Attachment F, pp. 248-249) requiring all cannabis operators to open an escrow account by September 15, 2023, to ensure payment of Cost Recovery Fees. As of the writing of this report, the Operator has not opened an escrow account nor made any payments into the account.

19. Under Article 5(d) of the DA, the City Manager, his/her designee(s), and Sheriff’s Department designee have the right to enter the Subject Site from time to time unannounced for the purpose of making reasonable inspections to observe and enforce compliance with the Development Agreement and state and local laws and regulations without the requirement of a search warrant, subpoena, or court order. Condition of Approval No. 16 also permits the City Building Official, City Cannabis Enforcement staff, and Planning Department staff the authority to conduct periodic site inspections to ensure compliance with CCP conditions (Attachment F, p. 73).

On October 10, 2023, the City staff from the Building and Safety Division conducted an inspection of the Site and posted a stop work notice due to unpermitted construction (Attachment F, pp. 251-252). During the inspection the following Building and Fire Code violations were observed: (1) installation of a double door and roll up door; and (2) installation of fire sprinkler lines. All violations observed were constructed without obtaining the proper permits and/or inspections. The Operator has failed to take necessary actions to correct the stop work notice. To correct the actions, the Operator is required to obtain requisite approvals and permits from the City Planning Division, Building & Safety Division, and the County Fire Department. As of the writing of this report, the Operator has not obtained requisite approvals and permits from the City Planning Division, Building & Safety Division, or the County Fire Department.

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20. On October 24, 2023, the City issued a letter (Attachment F, pp. 254-255) updating the Operator on their payment and fees related to the DA by correcting the amount due to an error in the total amount billed. The City provided the Operator a credit in the amount of $14,950.50, which was applied to the Operator’s outstanding balance of $495,487.88 outstanding as of October 1, 2023.

21. On November 27, 2023, the City issued to the Operator a Notice of Review Hearing (Attachment F, pp. 257-258) with the hearing date, time, and place. The notice informed the Operator that the Review Hearing was being held pursuant to Article 19 of DA No. 18- 014C, requested the Operator to timely submit evidence of compliance and to submit payment for an estimated cost3 of the Review Hearing (Attachment F, pp. 257-258). The City did not receive any response, reply, documents evidencing compliance, or payment for the cost of the Review Hearing.

22. As of December 23, 2023, the website for the Department of Cannabis Control reflected no record of a cannabis license issued to Starcraft, LLC (Attachment K). As of the writing of this report, there continues to be no record of any cannabis license issued to the Operator (Attachment N).

23. On December 29, 2023, the City sent a follow-up to the Notice of Review (“Follow Up Notice”) to the Operator confirming that it had not received any communication from the Operator confirming attendance at the Review Hearing and that the ability to present before the hearing officer had been waived (Attachment H). The City did not receive any response from the Operator.

24. On January 8, 2024, the duly appointed third-party Hearing Officer, Steve Napolitano, conducted a Review Hearing as authorized under CMC Section 5.20.080(7) and Section 19 of the DA No. 18-014C to hear and consider information and evidence submitted by City staff through an Administrative Record (Attachment F) and the Operator. No representation from the Operator was present at the hearing nor did the Operator submit any information or evidence for consideration.

25. On February 15, 2024, the Hearing Officer issued a written decision and order (the “Decision”) (Attachment G) finding evidence showing the Operator, despite considerable notice and opportunities to cure outstanding issues, has breached the terms and conditions of the DA and CCP and recommends the Planning Commission and City Council repeal Ordinance No. 701 terminating DA No. 18-014C and revoke the related interest in CCP No. 18-0014.

26. On May 14, 2024, pursuant to State law and the CMC, the Planning Commission held a duly noticed public hearing to consider the Hearing Officer’s recommendation to repeal Ordinance No. 701 and terminate DA No. 18-014C. The Planning Commission considered 3 Pursuant to Article 19(a) of the DA, Operators must submit an annual review and administration fee deposit based on the City’s estimated cost, upon the City’s reasonable notice in advance of the review. The City provided approximately 39 days’ notice of the estimated cost.

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all public comments received before and during the public hearing, the presentation by City staff, the relevant staff report, administrative record, and all other pertinent documents. No representation from the Operator was present at the hearing. After closing public hearing, the Planning Commission adopted Resolution No. 2024-15 (Attachment M), recommending the City Council repeal Ordinance No. 701 and terminate related DA No. 18-014C.

27. As of the writing of this report, Operator has continuously failed to make payments and as of June 13, 2024, owes $570,700.50 (Attachment I).

DISCUSSION/ANALYSIS
During a review of the Operator’s compliance with the Development Agreement, the burden is upon the Operator to demonstrate good faith compliance with the terms of the Development Agreement under Article 19. Pursuant to Government Code Section 65868.1 and Articles 19 and 19(d) of the Development Agreement, if the City Council determines, based on substantial evidence, that the Operator has not complied in good faith with the terms of the conditions of the Development Agreement, the City Council may terminate the Development Agreement or alternatively may choose to modify and impose conditions reasonably necessary to protect the interests of the City. Conversely, if the Operator is found to be in compliance with the Development Agreement, the Operator may request the City to issue a Certificate of Compliance pursuant to Article 19(e). Any decision to terminate a development agreement must be reviewed by the Planning Commission prior to review by the City Council. Gov. Code § 65867. Under Article 19(d), the decision to terminate a development agreement by the City Council is final and only subject to appeal pursuant to Civil Code Section 1094.5.

As it relates to the CCP, pursuant to CMC Sections 5.20.080(6) and 5.20.080(7), any material violations of Chapter 5.20, any other relevant city law or state law, condition of approval, or any other required agreement or covenant, such as a development agreement, by a cannabis permittee, or cannabis permittee’s agent, is ground for suspending or revoking the relevant cannabis permit. The decision to suspend or revoke a cannabis permit is with the City Manager or his designee. Furthermore, pursuant to CMC Section 5.20.080, any decision regarding the suspension or revocation may be appealed to the City Council.

The City has appointed a Hearing Officer to conduct a review of the Operator’s compliance with CCP No. 18-0014 and DA No. 18-014C. The findings and determinations made by the Hearing Officer inform any subsequent action to terminate or modify the Development Agreement and suspension or revocation of the CCP. As stated above, and further described in Attachment G, the Hearing Officer issued a written decision making several findings of fact and conclusions and determined that Starcraft, LLC breached the terms and conditions pursuant to DA No. 18-014C and CCP No. 18-0014, based on a preponderance of the evidence, in the following material aspects:

1. Violation #1: Breach of Payment Obligations. Pursuant to the terms of the DA, the Operator is responsible for timely payment of Community Benefit Fees (Article 5(b)); Cost

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Recovery Fees (Article 8); and Operating Fees (Article 7(c)). The Operator’s obligation to make timely payments of the Community Benefit Fees, Cost Recovery Fees and Operating Feeds under the DA is also restated in CCP Condition of Approval No. 45; and timely payment for Operating fees pursuant to Condition of Approval No. 8 for cultivation activities (Attachment F, pp. 67-75). Pursuant to the terms of the DA, Operators that are more than 30 days past due with Operating Fees are subject to a penalty equal to twentyfive percent (25%). In addition, a ten percent (10%) penalty shall be added to the first day of each calendar month following the imposition of the initial 25% penalty, if the fee remains unpaid in whole or in part, up to a maximum of the one hundred percent (100%) of the payable fee.

The Operator’s duty to comply with the CCP conditions of approval are incorporated into DA No. 18-014C under Section 18.4 Conditions 1(a) and 1(b) require the Operator to pay all City-issued invoices within 30 days of receipt. The City has regularly sent monthly invoices for Community Benefit Fees, Cost Recovery Fees, Non-Operating Fees, and applicable late penalties since 2019 (Attachment F, pp. 263-373).

The City executed a Letter Agreement to grant the Operator relief in the form of deferred payment obligations of the Operating Fees and a payment schedule for past-due Community Benefit Fees and Cost Recovery Fees; and an obligation to remain current on recurring fees under the DA. The Operator did not make a single timely payment in the three months that followed the execution of the Letter Agreement between March to May 2023. As of December 2023, the City reported that the Operator is past due in the amount of $503,912.82 and past-due payments continue to accumulate, including late payment penalties. The Operator continues to fail to make payments and as of June 13, 2024, $570,700.50 is due and owing.

Table 1. Summary of Past and Current Amounts Due as of June 13, 2024 Fee Type Payment Amount Due
Community Benefit Program $365,335.16
Cost Recovery Fees $101,453.31
Non-Operating Fees $78,448.44
Penalties (Late Payments) $25,463.59
TOTAL $570,700.50
Based on the evidence submitted by the City, the Hearing Officer found that “based on the unrefuted evidence presented by the City...a preponderance of the evidence shows that [Operator] breached multiple conditions of the DA and CCP. Despite multiple attempts and notices by the City to gain compliance, the evidence shows that [Operator] failed to comply with their payment obligations, which constitutes the necessary grounds for termination of the DA and revocation of the CCP under the CMC” 4 Section 18 of DA No. 18-014C states “Owner shall comply with all conditions of approval of the Regulatory Permit approved by City Council.” The Regulatory Permit is CCP No. 18-0014.

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(Attachment G). The CCP conditions of approval are incorporated into the DA through Section 18. The Hearing Officer’s determination was ratified by the Planning Commission through the adoption of Resolution No. 2024-15 which recommends that the City Council find that Operator is in default of the terms set forth in DA No. 18-014C and repeal Ordinance No. 701 and terminate the related DA.

2. Violation #2: Failure to Implement the Project Under Prescribed Time Limits under CCP No. 18-0014. The Operator’s duty to comply with the CCP’s conditions of approval are incorporated into DA No. 18-014C under Section 18. CCP Condition of Approval No. 20(A)(i) sets a 90-day time frame in which the Operator needed to obtain a Zoning Clearance. Condition of Approval No. 20(A)(ii) sets a 90-day time frame in which the Operator must complete construction of Phase I of the Project. CCP Condition of Approval 20(A)(iii) sets a 180-day time limitation from the effective date of the CCP to complete all tenant improvements, construction, and obtain a certificate of occupancy from the Building & Safety Division. Failure to obtain a Zoning Clearance within 90 days of the effective date of the CCP, renders the CCP to “expire and become null and void” (Attachment F, p. 74). The City Manager’s ability to grant an extension of time for a Zoning Clearance if the Operator has made diligent efforts to implement the project is stated in Conditions of Approval 20(A)(i), (ii), and (iii). The Operator was notified of the failure to implement the project within the prescribed timelines and provided an opportunity to cure pursuant to the City’s Final Demand Letter (Attachment E).

The Operator has failed to provide any evidence that it has obtained a Zoning Clearance, completed construction of Phase I, or completed the tenant improvements, obtained a certificate of occupancy, or otherwise demonstrated substantial progress to complete Phase II within the prescribed time periods. Nor does the City have any record of any request by the Operator for an extension of time to the City Manager and there is no evidence to demonstrate the Operator has made substantial progress, such as submitting an application for a Zoning Clearance or building permit plan check. Based on the evidence submitted by the City, the Hearing Officer found that “[t]o the extent the [Operator] has obtained building permits and constructed any improvements, these permits were obtained in violation of Condition of Approval No. 18 under CCP No. 18- 0014. The [Operator] has not obtained a Zoning Clearance pursuant to Chapter 20.84 of the CMC, but [Operator] has obtained permits for (1) an electrical permit for an electrical panel and circuit; (2) a plumbing permit for a toilet and sink; (3) a building permit for the installation of metal panels on the exterior of the facility; and (4) a demolition permit for the demolition of interior partition walls. In order for the [Operator] to complete tenant improvements or otherwise obtain a certificate of occupancy the [Operator] is required to remove all improvements made illegally as outlined in [Attachment F, pp. 251-252] and submit complete plans for plan check to complete tenant improvements. “ “Based on the foregoing, the [Operator] breached its conditions of approval for CCP No. 18-0014 failing to implement the Project within the time limits set forth in Conditions of Approval No. 20” (Attachment G, p. 8). As previously stated, the CCP conditions of approval are incorporated into the DA through Section 18. The Hearing Officer’s

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determination was ratified by the Planning Commission through the adoption of Resolution No. 2024-15 which recommends that the City Council find that Operator is in default of the terms set forth in DA No. 18-014C and repeal Ordinance No. 701 and terminate the related DA.

3. Violation #3: Breach of Condition of Approval No. 18 (Construction Activities) under CCP No. 18-0014. The Operator’s duty to comply with the CCP’s conditions of approval are incorporated into DA No. 18-014C under Section 18. CCP No. 18-0014 Condition of Approval No. 18 states that “prior to any construction, the [Operator] shall obtain a Zoning Clearance for construction from the Planning Division and a Building Permit from the Building and Safety Division.” The City has no record of any requisite applications, approvals, or permits, inclusive of a Zoning Clearance, for permits obtained by the Operator for some limited work described above. Additionally, the City contacted the Los Angeles Fire Department, Special Occupancy Inspection Unit, and no building permits record were found for the fire sprinklers (Attachment F, pp. 387-388). In accordance with Article 4(d) of the DA, the Owner “shall not operate any facility, and no permit, license, or other approval issued by City shall be valid unless and until the Los Angeles County Fire Department has approved Owner's site plan, floor plan, safety plan, and any other plans that require its approval.”
The Operator failed to obtain any requisite approvals, inclusive of a Zoning Clearance and permits from the City Planning Division and Building & Safety Division prior to the installation of interior nonstructural walls, metal framing, fire sprinkler lines, and a restroom remodel in the facility.

Based on the unrefuted evidence submitted by the City, the Hearing Officer found that “[t]he [Operator] failed to obtain requisite approvals, inclusive of a Zoning Clearance, and permits from the City Planning Division and Building & Safety Division prior to the installation of interior nonstructural walls, metal framing, fire sprinkler lines, and a restroom remodel in the facility. Therefore, the [Operator] breached Conditions of Approval No. 28 of CCP No. 18-0014” (Attachment G, pp. 8-9). As previously stated, the CCP conditions of approval are incorporated into the DA through Section 18. The Hearing Officer’s determination was ratified by the Planning Commission through the adoption of Resolution No. 2024-15 which recommends that the City Council find that Operator is in default of the terms set forth in DA No. 18-014C and repeal Ordinance No. 701 and terminate the related DA.

4. Violation #4: Breach of Conditions of Approval No. 17 (Commercial Cannabis Permit Modification) Under CCP No. 18-0014. CCP Condition of Approval No. 17 states “prior to undertaking any operational or construction-related activity which is not expressly described in the CCP conditions, the [Operator] shall first contact the City Manager, or his designee, to determine if the proposed activity requires a modification of the CCP. The City Manager may, at his sole discretion, require the Operator to file a written and/or mapped description of the proposed activity in order to determine if a permit modification is required.”

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On January 4, 2022, the Operator submitted building permit plans for interior tenant improvements at the Subject Site to the City’s plan check consultants without first obtaining a Zoning Clearance from the Planning Division and payment of the required fees. Furthermore, the plans submitted by the Operator do not conform to the original Site Plan and Floor Plans approved by the City in the Operator’s CCP and DA. These revised plans would have additionally allowed for distribution activities which the Operator was not approved for. The Operator was authorized by the City for commercial cannabis cultivation activities only. The Operator never filed a written or mapped description of the design changes made to the facility plans nor made the City Manager aware that such changes would be made. The City Manager has not approved any changes to the facility that do not conform to the original site plan and floor plan approved by the City in the Operator’s CCP and DA.

Based on the unrefuted evidence submitted by the City, the Hearing Officer found that “the [Operator] breached its conditions of approval for CCP No. 18-0014 by failing to receive City Manager approval for the design changes made to the facility set forth in Conditions of Approval No. 17” (Attachment G, p. 9). As previously stated, the CCP conditions of approval are incorporated into the DA through Section 18. The Hearing Officer’s determination was ratified by the Planning Commission through the adoption of Resolution No. 2024-15 which recommends that the City Council find that Operator is in default of the terms set forth in DA No. 18-014C and repeal Ordinance No. 701 and terminate the related DA.

5. Violation #5: Non-compliance with State Law. Recital I of the DA states the Owner has applied for one (1) cannabis license for cultivation activities. Section 21 of the DA states that the facility shall not operate unless the Owner is the holder of a State-issued Cannabis license for the type of commercial cannabis facility or business operation that is the subject of the DA. The Owner has breached the DA because the Owner has not obtained a State-issued Cannabis license for the facility. As of July 9, search of the term “Starcraft” on the Department of Cannabis Control’s website shows no record of an active cannabis license issued to the Operator (Attachment N).

Based on the unrefuted evidence submitted by the City, the Hearing Officer found that the “[Operator] has failed to maintain all its necessary licenses to operate under the DA, which constitutes a breach of Article 21 of the DA” (Attachment G, p. 9). The Hearing Officer’s determination was ratified by the Planning Commission through the adoption of Resolution No. 2024-15 which recommends that the City Council find that Operator is in default of the terms set forth in DA No. 18-014C and repeal Ordinance No. 701 and terminate the related DA.

PUBLIC NOTICE AND COMMENTS
This item was noticed in accordance with the City’s public notice requirements, which involved mailed notices to property owners and tenants within 300 feet of the Site and publication in

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the local newspaper (Attachment J). As of the writing of this report, City staff have not received any public comments.

ENVIRONMENTAL ANALYSIS
The action(s) have been assessed in accordance with the California Environmental Quality Act (“CEQA”) (Pub. Res. Code § 21000 et seq.), CEQA Guidelines (Cal, Code Regs., tit. 14, § 15000 et seq.) and the environmental regulations of the City. The Project is categorically exempt from the requirements of CEQA pursuant to CEQA Guidelines Section 15321 - Class 21 (Enforcement Actions by Regulatory Agencies). This exemption is applicable to “[a]ctions by regulatory agencies to enforce or revoke a lease, permit, license, certificate, or other entitlement for use issues, adopted, or prescribed by the regulatory agency or enforcement or a law, general rule, standard, or objective, administered or adopted by the regulatory agency.” If the City Council adopts Ordinance No. 754 to repeal Ordinance No. 701 and terminate DA No 18-014C, it would be an enforcement action. Therefore, the action(s) are categorically exempt from the provisions of CEQA.

CONCLUSION
As discussed above and based on the preponderance of unrefuted evidence offered at the Review Hearing; the public hearing by the Planning Commission finding that the Operator has failed to comply with the terms and conditions of its DA, despite being provided with ample notice and several opportunities to achieve compliance, thereby recommending to the City Council that it repeal Ordinance No. 701 and DA No. 18-014C through the adoption of Planning Commission Resolution No. 2024-15. As stated above, the Operator has failed to comply with their obligations under the DA, despite being provided with ample notice and several opportunities to achieve compliance. Therefore, City staff recommends the City Council adopt Ordinance No. 754 repealing Ordinance No. 701 and terminating DA No. 18-014C.

ATTACHMENT(S)
A. Proposed Ordinance No. 754
B. Ordinance No. 673
C. City Council Minutes – December 4, 2018
D. Ordinance No. 701
E. Final Demand Letter dated June 23, 2023
F. Administrative Record for Starcraft, LLC
G. Decision and Order for Starcraft, LLC
H. Review Hearing Waiver dated December 29, 2023
I. Invoice dated June 13, 2024
J. Newspaper Publication
K. State Cannabis Unified Search Results for Starcraft, LLC L. City Council Minutes – December 4, 2018
M. Planning Commission Resolution No. 2024-15

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N. Department of Cannabis Control Search Results – July 9, 2024

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ORDINANCE NO. 754

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY
OF CUDAHY REPEALING ORDINANCE NO. 701 AND

TERMINATING RELATED DEVELOPMENT AGREEMENT
NO. 18-014C BETWEEN STARCRAFT, LLC AND THE
CITY OF CUDAHY.

WHEREAS, the City of Cudahy (the “City”) is a general law city, incorporated under the laws of the State of California; and
WHEREAS, pursuant to its police power, the City may enact and enforce laws within its boundaries that promote the public health, safety, or general welfare of the community, and are not in conflict with general laws; and WHEREAS, to strengthen the public planning process, encourage private participation in comprehensive planning and reduce the economic risk of development, the California State Legislature adopted Section 65864 et seq. of the California Government Code (the “Development Agreement Statute"); and WHEREAS, the Development Agreement Statute authorizes the City to enter into a development agreement with a person having legal or equitable interest in real property for the development of such property in order to establish certain development rights in exchange for public benefits; and
WHEREAS, in accordance with the Development Agreement Statute, the City Council adopted Ordinance No. 690 in 2018 establishing the procedures and requirements for the consideration of development agreements with the City and are contained within Cudahy Municipal Code (“CMC”) Sections 20.84.530 through

20.84.640; and
WHEREAS, on September 11, 2017, the City Council adopted Ordinance No. 673 establishing regulations for commercial cannabis activities, in a specified Overlay Zone through an acquisition of a Commercial Cannabis Permit and execution of a development agreement with the City; and
WHEREAS, on November 19, 2018, the City Planning Commission (“Planning Commission”) conducted a properly noticed public hearing to consider an application by Starcraft, LLC (“Operator”) for approval of a Commercial Cannabis Permit to allow nonstore front commercial cannabis cultivation activities at 4925 Cecelia Street (“Site”); and WHEREAS, at this hearing, the Planning Commission heard and considered verbal and written testimony and evidence, and recommended on a 2-1 vote to continue the item to a date uncertain; and
WHEREAS, on November 23, 2018, the City received a formal written correspondence in the nature of an appeal from the Operator requesting that the City Council hold an immediate hearing on their applications for a Commercial Cannabis ATTACHMENT A Page 2767 of 3559
City Council Ordinance No. 754

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Permit and a Development Agreement; and
WHEREAS, on December 4, 2018, the City Council conducted a properly noticed public hearing to consider the issuance of the Commercial Cannabis Permit (“CCP”) No. 18-014 and Development Agreement (“DA”) No. 18-014C at which the City Council heard and considered both written and oral testimony and evidence and subsequently approved, and adopted Resolution No. 18-57 for CCP No. 18-0014; and WHEREAS, at the same hearing the City Council considered and approved CCP No. 18-0014 it also conducted the first reading of Ordinance No. 701 which authorized the execution of DA No. 18-014C between the Operator and the City; and WHEREAS, on December 18, 2018, the City Council adopted, on second reading, Ordinance No. 701 approving DA No. 18-014C and authorizing the Mayor to execute the DA on behalf of the City; and
WHEREAS, the effective date of the Development Agreement is April 5, 2019 (“Effective Date”); and
WHEREAS, upon the Effective Date of Ordinance No. 701, the Operator was granted the permission to conduct commercial cannabis cultivation activities provided, among other things, it apply for and receive a Zoning Clearance pursuant to the CMC’s requirements, receive State licensing approval from the Department of Cannabis Control, and comply with the terms outlined in the DA and conditions of approval under the CCP inclusive of the timely payment of Community Benefit Fees, Cost Recovery Fees and Operating/Non-Operating Fees and applicable penalties and interest; and WHEREAS, the Operator has not complied with the terms and conditions of the DA and CCP despite multiple notices and opportunities to cure, and remains in material breach of thereof; and
WHEREAS, on November 27, 2023, the City provided notice to the Operator that it would be conducting a Review Hearing (“Review Hearing”) under Article 19 of DA No. 18-014C, which informed the Operator of the burden to prove compliance with the DA and CCP; and
WHEREAS, the Operator never provided a timely response to the City’s notice for a Review Hearing; and
WHEREAS, on November 29, 2023, the City sent a follow up notice informing the Operator it had not received any response to the Review Hearing Notice; and WHEREAS, the Operator did not respond to the follow up notice; and WHEREAS, on January 8, 2024, Steve Napolitano, Esq., a duly appointed thirdparty hearing officer for the City (“Hearing Officer”), conducted a properly noticed Review Hearing; and
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WHEREAS, the Operator did not participate at the Review Hearing, was not present at the hearing and did not present any evidence for consideration prior to or during the hearing, and the Hearing Officer heard and considered information and evidence by City staff, which a true and correct copy of the staff report and supporting evidence is attached hereto as Exhibit “A” and incorporated herein by reference; and WHEREAS, the Hearing Officer heard and considered information and evidence by City staff; and
WHEREAS, on February 15, 2024, the Hearing Officer issued a written decision and order (the “Decision”), incorporated by reference and attached hereto as Exhibit “B”, making several findings of fact and conclusions of law with respect to the Operator’s noncompliance with the DA and CCP based on a preponderance of the evidence; and WHEREAS, the CCP’s conditions of approval are incorporated into the DA through Article 18 of DA No. 18-014C; and
WHEREAS, the Hearing Officer determined that the Operator breached the DA and CCP in five material respects; and
WHEREAS, the Hearing Officer determined that Operator breached its payment obligations due to the Operator’s non-payment of fees and penalties due and owed to the City totaling $503,912.83, which continue to accumulate; and WHEREAS, the Operator continues to fail to meet its payment obligations and the total amount due to the City as of June 13, 2024, is $570,700.50; and WHEREAS, the Operator breached its obligation to implement the project within the prescribed time periods contained within CCP No. 18-0014 Condition of Approval No. 20 (Time Limits), because there is no evidence that the Operator has made a diligent effort to implement the Project in any fashion inclusive of an application for a Zoning Clearance to permit the commercial cannabis activities; and WHEREAS, the Operator breached CCP No. 18-0014 Condition of Approval No. 18 (Construction Activities) for failing to obtain any requisite approvals from the City Planning Division and Building & Building and Safety Division prior to conducting construction activities; and
WHEREAS, the Operator breached CCP No. 18-0014 Condition of Approval No. 17 (Commercial Cannabis Permit Modification) due to the Operator’s failure to receive City Manager approval for the design changes made to the facility; and WHEREAS, the Operator failed to comply due to operator's failure to maintain all its necessary licenses to operate in the state of California, in violation of Article 21 under the DA; and
WHEREAS, the Hearing Officer has recommended that the City Council adopt an ordinance repealing Ordinance No. 701 terminating DA18-014C and revoking the related ATTACHMENT A Page 2769 of 3559
City Council Ordinance No. 754

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interest in CCP18-0014; and
WHEREAS, pursuant to state law and the CMC, the Planning Commission duly noticed, agendized, and conducted a public hearing on this matter on May 14, 2024; and WHEREAS, the Planning Commission considered all public comments received before and during the public hearing, the presentation by City staff, the relevant staff report, administrative record, and all other pertinent documents relating to the repeal of Ordinance No. 701; and
WHEREAS, after the close of such public hearing, the Planning Commission adopted Resolution No. 2024-15, attached hereto and incorporated by reference as Exhibit “C”, recommending the City Council repeal Ordinance No. 701 and terminate related DA No. 18-014C; and
WHEREAS, pursuant to state law and the CMC, the City Council duly noticed, agendized, and conducted a public hearing on this matter; and WHEREAS, the City Council considered all public comments received before and during the public hearing, the presentation by City staff, the relevant staff report, administrative record, and all other pertinent documents relating to the repeal of Ordinance No. 701; and
WHEREAS, after the close of such public hearing, the City Council introduced and adopted by first reading Ordinance No. 754, repealing Ordinance No. 701 and terminating related DA No. 18-014C.

NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF CUDAHY DOES HEREBY ORDAIN AS FOLLOWS:

SECTION 1. RECITALS
That the above Recitals are true and correct and are incorporated as though fully set forth herein.

SECTION 2. ADOPTION OF HEARING OFFICER’S FINDINGS OF FACT AND

CONCLUSIONS OF LAW
The City Council has reviewed and considered the Decision by the Hearing Officer (Exhibit “B”) issued on February 15, 2024, on this matter. For the reasons stated in the Decision, and as recommended by the Planning Commission (Exhibit “C”), the City Council adopts the Hearing Officer’s findings of fact and conclusions of law as its own and determines that Starcraft, LLC is not in compliance with the terms and conditions of the Development Agreement No. 18-014C and finds that Starcraft, LLC is in default of its contractual obligations set forth in said Development Agreement and has breached its Conditions of Approval for CCP No. 18-0014 by a showing of the preponderance of the evidence.

ATTACHMENT A Page 2770 of 3559
City Council Ordinance No. 754

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SECTION 3. TERMINATION OF DEVELOPMENT AGREEMENT
Pursuant to Article 19(d) of the Development Agreement, the City Council may terminate Development Agreement No.18-014C in its entirety. For the reasons stated in the Decision, and as recommended by the Planning Commission, the City Council hereby adopts this Ordinance repealing Ordinance No. 701 terminating DA No. 18-014C in its entirety.

SECTION 4. SEVERABILITY
If any section, subsection, sentence, clause, phrase, or portion of this Ordinance is for any reason held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have adopted this Ordinance, and each section, subsection, subdivision, sentence, clause, phrase, or portion thereof, irrespective of the fact that any one or more sections, subsections, subdivisions, sentences, clauses, phrases, or portions might subsequently be declared invalid or unconstitutional.

SECTION 5. CALIFORNIA ENVIRONMENTAL QUALITY ACT
The City Council has determined that this Ordinance is categorically exempt from the California Environmental Quality Act (“CEQA”) (Pub. Res. Code § 21000 et seq.) and CEQA Guidelines (Cal. Code Regs., tit. 14, § 21000 et seq.) pursuant to CEQA Guidelines Section 15321 (Class 21) because the repeal of Ordinance No. 701 and termination of DA No. 18-014C is an enforcement action to revoke an entitlement interest.

SECTION 6. PUBLICATION
The City Clerk shall certify the passage and adoption of this Ordinance and shall cause this Ordinance to be published and/or posted as required by law, which shall take full force and effect thirty days from its adoption.

PASSED, APPROVED, AND ADOPTED by the City Council of the City of Cudahy at the regular meeting of this ______ day of _____ 2024. ______________________________
Jose R. Gonzalez
Mayor
ATTEST:

ATTACHMENT A Page 2771 of 3559
City Council Ordinance No. 754

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____________________________
Richard Iglesias
City Clerk

CERTIFICATION

STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES ) SS:

CITY OF CUDAHY )
I, Richard Iglesias, City Clerk of the City of Cudahy, hereby certify that the foregoing Ordinance No. 754 was introduced for a first reading on the _____ day of ____ 2024 and approved for a second reading and adopted by said Council at its regular meeting held on the ______ day of ______ 2024 by the following vote, to-wit:

AYES:

NOES:

ABSENT:

ABSTAIN:

Richard Iglesias
City Clerk
ATTACHMENT A Page 2772 of 3559
City Council Ordinance No. 754

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EXHIBIT “A”
EVIDENCE SUBMITTED BY THE CITY (“ADMINISTRATIVE RECORD”) ATTACHMENT A Page 2773 of 3559
City Council Ordinance No. 754

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EXHIBIT “B”

HEARING OFFICER DECISION AND ORDER
ATTACHMENT A Page 2774 of 3559
City Council Ordinance No. 754

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EXHIBIT “C”

PLANNING COMMISSION RESOLUTION
ATTACHMENT A Page 2775 of 3559
ORDINANCE NO. 673

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
CUDAHY AMENDING TITLE 5 (BUSINESS LICENSES AND
REGULATIONS) AND TITLE 20 (ZONING) OF THE

CUDAHY MUNICIPAL CODE TO PROHIBIT CANNABIS

RETAILERS/DISPENSARIES CITYWIDE AND TO

ESTABLISH REGULATIONS AND A DISCRETIONARY

REVIEW PROCESS FOR THE ALLOWANCE OF

MEDICINAL-ONLY COMMERCIAL CANNABIS ACTIVITIES
(CULTIVATION, DISTRIBUTION, MANUFACTURING,

DELIVERIES, MICROBUSINESS, AND LABORATORY

TESTING) IN A SPECIFIED OVERLAY ZONE THROUGH A

DEVELOPMENT AGREEMENT
WHEREAS, in 1996, the California Legislature approved Proposition 215, also known as the Compassionate Use Act (the "CUA"), which was codified under Health and Safety Code Section 11262.5 et sec. and was intended to enable persons in need of medical marijuana for specified medical purposes, such as cancer, anorexia, AIDS, chronic pain, glaucoma and arthritis, to obtain and use marijuana under limited circumstances and where recommended by a physician. The CUA provides that "nothing in this section shall be construed or supersede legislation prohibiting persons from engaging in conduct that endangers others, or to condone the diversion of marijuana for non-medical purposes.";
WHEREAS, in 2004, the California Legislature enacted the Medical Marijuana Program Act (Health & Saf. Code, § 11362.7 et seq.)(the "MMP"), which clarified the scope of the CUA, created a state-approved voluntary medical marijuana identification card program, and authorized cities to adopt and enforce rules and regulations consistent with the MMP. Assembly Bill 2650 (2010) and Assembly Bill 1300 (2011) amended the MMP to expressly recognize the authority of counties and cities to "[a]dopt local ordinances that regulate the location, operation, or establishment of a medical marijuana cooperative or collective" and to civilly and criminally enforce such ordinances;
WHEREAS, the Federal Controlled Substances Act (21 U.S. C., § 801 et seq.) makes it unlawful under federal law for any person to cultivate, manufacture, distribute or dispense, or possess with intent to manufacture, distribute, or dispense marijuana.

Despite such federal prohibition, on August 29, 2013, the United States Department of Justice issued a memorandum (the "Cole Memo") stating that, notwithstanding the federal classification of marijuana as a schedule 1 controlled substance, jurisdictions that have legalized marijuana in some form are less likely to be subject to federal enforcement under the Controlled Substances Act if they have implemented strong and effective regulatory and enforcement systems to follow eight guiding principles: (1) preventing the distribution of marijuana to minors; (2) preventing revenue from the sale of marijuana from going to criminal enterprises, gangs, and cartels; (3) preventing the

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ATTACHMENT B Page 2776 of 3559
diversion of marijuana from states where it is legal under state law in some form to other states; (4) preventing state-authorized marijuana activity from being used as a cover or pretext for the trafficking of other illegal drugs or other illegal activity; (5) preventing violence and the use of firearms in the cultivation and distribution of marijuana; (6) preventing drugged driving and the exacerbation of other adverse public health consequences associated with marijuana use; (7) preventing the growing of marijuana on public lands and the attendant public safety and environmental dangers posed by marijuana production on public lands; and (8) preventing marijuana possession or use on federal property;
WHEREAS, in September 2015, the California State Legislature enacted, and Governor Brown signed into law three bills - Assembly Bill 243, Assembly Bill 266, and Senate Bill 643 - which together comprise the Medical Marijuana Regulation and Safety Act (the "MMRSA"). The MMRSA created a comprehensive dual state licensing system for the cultivation, manufacture, retail, sale, transport, distribution, delivery, and testing of medical cannabis;
WHEREAS, on August 22, 2016, the City Council of the City of Cudahy (the "City Council" of the "City") adopted Interim Urgency Ordinance No. 656U to establish a temporary moratorium on medical "commercial cannabis activities," as defined under the MMRSA, for a period of 45 days and extended such moratorium for an additional period of 22 months and 15 days under Interim Urgency Ordinance No. 661, on September 26, 2016;
WHEREAS, the MMRSA was renamed the Medical Cannabis Regulation and Safety Act (the "MCRSA") under Senate Bill 837 in June 2016, which also made substantive changes to the applicable state laws, which affect the various state agencies involved in regulating cannabis businesses as well as potential licensees; WHEREAS, on November 8, 2016, the Control, Regulate, and Tax Adult Use of Marijuana Act ("AUMA") was approved California voters as Proposition 64 and became effective on November 9, 2016, pursuant to the California Constitution (Cal. Const., art.

II, § 10(a).). Proposition 64 legalized the nonmedical use of cannabis by persons 21 years of age and over, and the personal cultivation of up to six (6) cannabis plants. On November 14, 2016, the City Council adopted Urgency Ordinance No. 663 to prohibit outdoor personal marijuana cultivation and establish regulations and a permitting process for indoor personal marijuana cultivation;
WHEREAS, AUMA also created a state regulatory and licensing system j governing the commercial cultivation, testing, and distribution of nonmedical cannabis, and the manufacturing of nonmedical cannabis products. On January 9, 2017, Interim Urgency Ordinance No. 666 was adopted by the City Council to establish a temporary moratorium on nonmedical "commercial cannabis activities" for a period of 45 days and extended such moratorium for an additional period of 22 months and 15 days under Interim Urgency Ordinance No. 667, on February 27, 2017; Page2
ATTACHMENT B Page 2777 of 3559
\
I
)
WHEREAS, on June 27, 2017, Governor Brown signed the Legislature-approved Senate Bill 94. SB 94 combined elements of the MCRSA and AUMA to establish a streamlined singular regulatory and licensing structure for both medical and nonmedical cannabis activities given that there were discrepancies between the MCRSA and AUMA. The new consolidated provisions under SB 94 is now known as the Medicinal and Adult-Use Cannabis Regulation and Safety Act ("MAUCRSA") to be governed by the California Bureau of Cannabis Control. MAUCRSA refers to medical cannabis as "medicinal cannabis" and nonmedical/recreational cannabis as "adult-use cannabis"; WHEREAS, on June 27, 2017, the as part of an Economic Development Ad Hoc Committee presentation on revenue-generating opportunities, commercial cannabis regulations and strategies were offered to and discussed by the City Council; WHEREAS, the City seeks to establish an overlay zone in the City in which certain medicinal-only commercial cannabis activities can be conducted in accordance with MAUCRSA and the City's police power under Section 7 of Article XI of the California Constitution;
WHEREAS, it is the purpose and intent of the City to regulate medicinal cannabis in a manner that is consistent with the Cole Memo and promotes the health, safety, and general welfare of the residents and businesses within the City, while limiting any negative impacts;
WHEREAS, the City intends to be on the forefront of groundbreaking research, science, innovation, and development of treatment for symptoms and cures in the field of medicinal cannabis, as scientific research, studies, and data have established that medicinal cannabis can help patients with a vast array of medical conditions; WHEREAS, the City desires to reduce the illegal market for cannabis while minimizing the chances of social harm and creating jobs and revenue for the City; and WHEREAS, nothing in this Ordinance shall be construed to allow persons to engage in conduct that violates the law, endangers others, causes a public nuisance, allows the illegal use or diversion of cannabis, or allows any activity relating to cannabis that is otherwise illegal under California state law, as amended.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CUDAHY DOES ORDAIN AS FOLLOWS:

SECTION 1. The above recitals are true and correct and are incorporated herein.

SECTION 2. Title 20 (Zoning) of the Cudahy Municipal Code is hereby amended by the addition of a new Chapter 20.120 (Commercial Cannabis Overlay Zone), which shall read as follows:

Chapter 20.120 - Commercial Cannabis Overlay Zone.

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ATTACHMENT B Page 2778 of 3559

20.120.010 Definitions
For purposes of this Chapter 20.120, the following definitions shall apply:
"Commercial cannabis activities" mean the cultivation, possession, manufacture, distribution, processing, storing, laboratory testing, packaging, labeling, transportation, delivery or sale of cannabis and cannabis products. ) "Cannabis" means all parts of the Cannabis sativa Linnaeus, Cannabis indica, or j Cannabis ruderalis, whether growing or not; the seeds thereof; the resin, whether crude or purified, extracted from any part of the plant; and every compound, manufacture, salt, derivative, mixture, or preparation of the plant, its seeds, or resin. "Cannabis" also means the separated resin, whether crude or purified, obtained from cannabis. "Cannabis" also means marijuana as defined by Section 11018 of the California Health and Safety Code as enacted by Chapter 14017 of the Statutes of 1972. Cannabis does not include the mature stalks of the plant, fiber produced from the stalks, oil or cake made from the seeds of the plant, any other compound, manufacture, salt, derivative, mixture, or preparation of the mature stalks (except the resin extracted therefrom), fiber, oil, or cake, or the sterilized seed of the plant which is incapable of germination. For the purpose of this Chapter, cannabis does not mean industrial hemp as that term is defined by Section 81000 of the California Food and Agricultural Code or Section 11018.5 of the California Health and Safety Code.
"Cannabis product" means cannabis that has undergone a process whereby the plant material has been transformed into a concentrate, or other cannabis derivative, including, but not limited to, concentrated cannabis, or an edible or topical product containing cannabis or concentrated cannabis and other ingredients. "Day care center" means any child day care facility other than a family day care home, and includes infant centers, preschools, extended day care facilities, and schoolage child care centers.
"Overlay Zone" means the commercial cannabis overlay zone, whose area and boundaries are attached to City Council Ordinance No. 673 as Exhibit "A" "MAUCRSA" means the Medicinal and Adult-Use Cannabis Regulation and Safety Act, as may hereinafter be amended.
"Youth center" means any public or private facility that is primarily used to host recreational or social activities for minors, including, but not limited to, private youth membership organizations or clubs, social service teenage club facilities, video arcades, or similar amusement park facilities.

Page4
ATTACHMENT B Page 2779 of 3559
l

20.120.020 Prohibitions.

Adult-use commercial cannabis activities and medicinal commercial cannabis activities, as both are described in state law, including, but not limited to MAUCRSA, are hereby prohibited unless otherwise allowed in this Chapter.

20.120.030 Overlay zone.

Medicinal commercial cannabis activities, except retail dispensaries that are open to the public for point-of-sale purchases, shall be allowed within the Overlay Zone pursuant to a development agreement adopted in accordance with the Development Agreement Law (Gov. Code, § 65864 et seq.) and Cudahy Municipal Code Chapter

20.28 (Development Agreements). No such activities shall be permitted without a development agreement within or outside of the boundaries of the Overlay Zone.

The City may approve or deny such a development agreement in its sole and absolute discretion.

20.120.040 Particular restrictions for Atlantic Avenue.

Section 20.120.030 notwithstanding, no cannabis-related business shall be located within the Overlay Zone and on Atlantic Avenue with a storefront facing Atlantic Boulevard unless such business employs and effectuates a business model with a primary entertainment purpose.

20.120.050 Indoor Horticulture.

Indoor horticulture, excluding cannabis horticulture shall be permitted by-right within the Overlay Zone.

20.120.060 Prohibition on new schools, day cares, and youth centers in overlay zone.

The establishment of public or private schools providing instruction in kindergarten or any grades 1 through 12, day care center, or youth center is prohibited within the Overlay Zone, or within 600 feet of the boundaries of the Overlay Zone, is hereby prohibited, unless otherwise mandated under state or federal law. An existing public or private school providing instruction in kindergarten or any grades 1 through 12, day care center, or youth center located within the Overlay Zone, or within 600 feet of the boundaries of the Overlay Zone shall be considered legal nonconforming, in accordance with Chapter 20.24 (Legal Nonconforming) of Title 20 (Zoning) of the Cudahy Municipal Code.

20.120.070 Temporary permits for local events - rights reserved.

The City reserves the right to issue temporary permits for onsite cannabis sales to, and consumption by, persons 21 years of age or older at a county fair, district agricultural association event, or other similar event authorized under state law, which is located within the Overlay Zone, pursuant to the provisions of Subdivision (e) of Business and Professions Code Section 26200.

SECTION 3. Subsection (3)(p) of Section 20.64.090 (Uses Permitted in Residential Zones by Conditional Use Permit) of Chapter 20.64 (Residential Districts) of Title 20 (Zoning) of the Cudahy Municipal Code is hereby amended to read as follows:

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ATTACHMENT B Page 2780 of 3559
(p) Schools, public and private, excluding schools providing instruction in kindergarten or any grades 1 through 12 located within 600 feet of a residential zone located within the Commercial Cannabis Overlay Zone illustrated in Exhibit "A" to City Council Ordinance No. 673, unless otherwise mandated under state or federal law.

SECTION 4. Subsection (24) of Section 20.68.100 (Uses Permitted in Residential Zones by Conditional Use Permit) of Chapter 20.68 (Commercial and Professional Districts) of Title 20 (Zoning) of the Cudahy Municipal Code is hereby amended to read as follows:
(24) Day care centers, excluding those occupying any portion of the CC zone located within 600 feet of the Commercial Cannabis Overlay Zone illustrated in Exhibit "A" to City Council Ordinance No. 673, unless otherwise mandated under state or federal law.

SECTION 5. Subsection (49) of Section 20.68.100 (Uses Permitted in Residential Zones by Conditional Use Permit) of Chapter 20.68 (Commercial and Professional Districts) of Title 20 (Zoning) of the Cudahy Municipal Code is hereby amended to read as follows:
(49) Schools, colleges, and universities, accredited, including appurtenant facilities that offer instruction required to be taught by the Education Code of the state of California and in which no pupil is physically restrained, excluding schools which provide instruction in kindergarten or any grades 1 through 12 that occupy any portion the CC zone located within 600 feet of the Commercial Cannabis Overlay Zone illustrated in Exhibit "A" to City Council Ordinance No. 673, unless otherwise mandated under state or federal law.

SECTION 6. Subsection (50) of Section 20.68.100 (Uses Permitted in Residential Zones by Conditional Use Permit) of Chapter 20.68 (Commercial and Professional Districts) of Title 20 (Zoning) of the Cudahy Municipal Code is hereby amended to read as follows:
(50) Schools, business and professional, including art, barber, beauty, dance, drama, music, and swimming, excluding schools which provide instruction in kindergarten or any grades 1 through 12 that occupy any portion the CC zone located within 600 feet of the Commercial Cannabis Overlay Zone illustrated in Exhibit "A" to City Council Ordinance No. 673, unless otherwise mandated under state or federal law.

SECTION 7. Subsection (46) of Section 20.68.150 (Uses by conditional use permit in C-M Zone) of Chapter 20.68 (Commercial and Professional Districts) of Title 20 (Zoning) of the Cudahy Municipal Code is hereby amended to read as follows:
(46) Schools, colleges, and universities, accredited, including appurtenant facilities which offer instruction required to be taught by the Education Code of the state and in which no pupil is physically restrained, excluding schools which provide instruction in kindergarten or any grades 1 through 12 that occupy any portion the C-M zone located within 600 feet of the Commercial Cannabis Overlay Zone illustrated in Exhibit "A" to City Council Ordinance No. 673, unless otherwise

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ATTACHMENT B Page 2781 of 3559
mandated under state or federal law.

SECTION 8. Subsection (47) of Section 20.68.150 (Uses by conditional use permit in C-M Zone) of Chapter 20.68 (Commercial and Professional Districts) of Title 20 (Zoning) of the Cudahy Municipal Code is hereby amended to read as follows:
(47) Schools, business and professional, including art, barber, beauty, dance, drama, music, and swimming, excluding schools which provide instruction in kindergarten or any grades 1 through 12 that occupy any portion the C-M zone located within 600 feet of the Commercial Cannabis Overlay Zone illustrated in Exhibit "A" to City Council Ordinance No. 673, unless otherwise mandated under state or federal law.

SECTION 9. Title 5 (Business License and Regulations) of the Cudahy Municipal Code is hereby amended by the addition of a new Chapter 5.20 (Cannabis Permitting and Regulation), which shall read as follows:

Chapter 5.20 - Cannabis Permitting and Regulation.

5.20.010 Section Intent and Purposes.

The intent and purpose of this Chapter is to regulate Commercial Cannabis Activity (as defined below) in accordance with State Law (as defined below) to promote the health, safety, morals, and general welfare of the residents and businesses within the City. The City is authorized to regulate this activity pursuant to State Law, including, but not limited to, MAUCRSA. The goals of this regulation for Commercial Cannabis Activity include:
(a) To comply with the goals and guidance set forth in the Cole Memo. (b) To minimize the size of the illegal market for Cannabis in the City and the surrounding regions.
(c) To create jobs, revenue, and economic growth for the City and its residents. (d) To enable law enforcement and regulators to have sufficient rights to inspect and audit Cannabis Permittees and take expeditious action against Cannabis Permittees who violate the requirements of this Chapter. (e) To minimize social harms which may arise from Cannabis including youth consumption or intoxicated driving.
(f) To regulate the manner of advertising and location of Cannabis Permittees such that public nuisance is minimized.

5.20.020 Definitions.

For purposes of this Chapter, the following definitions shall apply, unless the context clearly indicates otherwise:
(a) "Applicant" means an Owner seeking a Cannabis Permit pursuant to this Chapter.
(b) "Cannabis" means all parts of the Cannabis sativa Linnaeus, Cannabis indica, or Cannabis ruderalis, whether growing or not; the seeds thereof; the resin, whether crude or purified, extracted from any part of the plant; and every

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ATTACHMENT B Page 2782 of 3559
compound, manufacture, salt, derivative, mixture, or preparation of the plant, its seeds, or resin. Cannabis also means the separated resin, whether crude or purified, obtained from cannabis. Cannabis also means marijuana as defined by Section 11018 of the California Health and Safety Code as enacted by Chapter 14017 of the Statutes of 1972. Cannabis does not include the mature stalks of the plant, fiber produced from the stalks, oil or cake made from the seeds of the plant, any other compound, manufacture, salt, derivative, mixture, or preparation of the mature stalks (except the resin extracted therefrom), fiber, oil, or cake, or the sterilized seed of the plant which is incapable of germination. For the purpose of this Chapter 5.18, Cannabis does not mean industrial hemp as that term is defined by Section 81000 of the California Food and Agricultural Code or Section 11018.5 of the California Health and Safety Code.
(c) "Cannabis Permit" means a permit issued by the City to conduct a Commercial Cannabis Activity, including, but not limited to a Cultivation Permit, Distribution Permit, Manufacturing Permit, Microbusiness Permit, Retail Delivery Permit, or Testing.
(d) "Cannabis Permittee" means a Person who holds a Cannabis Permit. (e) "Cannabis Product" means cannabis that has undergone a process whereby the plant material has been transformed into a concentrate, or other cannabis derivative, including, but not limited to, concentrated cannabis, or an edible or topical product containing cannabis or concentrated cannabis and other ingredients.
(f) "City" shall mean the City of Cudahy.
(g) "City Coden means the City of Cudahy Municipal Code. (h) "City Manager" means the City Manager of the City of Cudahy. (i) "Cole Memo" means the August 29, 2013 United States Department of Justice memorandum offering guidance on federal enforcement priorities regarding Cannabis.

U) "Commercial Cannabis Activity(ies)" means the cultivation, possession, manufacture, distribution, processing, storing, laboratory testing, packaging, labeling, transportation, delivery or sale of Cannabis and/or Cannabis Products. (k) "Cultivation" means any activity involving the planting, growing, harvesting, drying, curing, grading, or trimming of Cannabis.
(I) "Cultivation Permit" means a Cannabis Permit for the Indoor Cultivation of Cannabis in accordance with the terms and conditions of this Chapter and the Development Agreement for the applicable Cannabis Permit issued to the particular Cultivation Permittee.
(m) "Cultivation Permittee" means an applicant who has applied for and has been issued a Cultivation Permit by the City pursuant to the terms and conditions of this Chapter.

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(n) "Day Care Center" means any child day care facility other than a family day care home, and includes infant centers, preschools, extended day care facilities, and schoolage child care centers.
(o) "Development Agreement" means an agreement adopted pursuant to the Development Agreement Law (Gov. Code, § 65864 et seq.) and Cudahy Municipal Code Chapter 20.28 (Development Agreements), which provides agreed upon community benefits to the City.
(p) "Distribution" means the procurement, sale, and transport of cannabis and cannabis products between persons authorized to engage in permitted commercial cannabis activities pursuant to this Chapter. (q) "Distribution Permit" means, with respect to a Distribution Permittee, a Cannabis Permit for Distribution in accordance with the terms and conditions of this Chapter and the Development Agreement for the applicable Cannabis Permit issued to such Distribution Permittee.
(r) "Distribution Permittee" means a Person that has been issued a Distribution Permit by the City pursuant to the terms and conditions of this Chapter. (s) "Fully Enclosed and Secure Structure" means a space within a building or other structure which has a complete roof enclosure supported by connecting walls extending from the ground to the roof, which is reasonably secure against unauthorized entry, provides complete visual screening or is behind fencing or other features providing complete visual screening, and which is accessible only through one or more lockable doors and is inaccessible to minors. (t) "Good Cause" for purposes of refusing or denying a Cannabis Permit, for revoking a Cannabis Permit, or for refusing or denying a Cannabis Permit renewal or reinstatement means: (i) the Applicant has not obtained approval by the City Council of a Development Agreement setting forth the general terms for the operation of commercial cannabis activity or breaches a term or terms of a Development Agreement approved by the City Council pursuant to this Chapter; (ii) The Applicant or Cannabis Permittee has violated the terms, conditions, or provisions of this Chapter, of state law, of any regulations or rules promulgated pursuant to state law or this Chapter, any applicable local rules, regulations, or conditions placed upon its state license or Cannabis Permit; (iii) the licensed Premises have been operated in a manner that adversely affects the public health, safety, or welfare or the safety of the immediate neighborhood in which the Commercial Cannabis Activity is being conducted; (iv) the Applicant or Cannabis Permittee has knowingly made false statements, misrepresentations, or material omissions on an application form, renewal form, or other document submitted to the City; (v) the Applicant or Cannabis Permittee's criminal history does not indicate that the Applicant or Cannabis Permittee is of Good Moral Character or the Applicant or Cannabis Permittee has been convicted of an offense that is substantially related to the qualifications, functions, or duties of the Applicant or Cannabis Permittee. However, if the City has issued a Cannabis Permit to the Applicant or Cannabis Permittee, the City shall not consider any

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criminal history of the Applicant or Cannabis Permittee that was disclosed to or discovered by the City prior to issuance of the Cannabis Permit and is confirmed by the Applicant or Cannabis Permittee. For any criminal history that was not disclosed to or discovered by the City prior to issuance of a Cannabis Permit, or that arose after the issuance of the Cannabis Permit, the City shall conduct a thorough review of the nature of the crime, conviction, circumstances, and evidence of rehabilitation of the Applicant or Cannabis Permittee, and shall evaluate the suitability of the Applicant or Cannabis Permittee based upon such review. In determining which offenses are substantially related to the qualifications, functions, or duties of the Applicant or Cannabis Permittee, the City shall consider factors set forth in Business and Professions Code Section 26057; (vi) the Applicant or Cannabis Permittee is employing or allowing to volunteer any person whose criminal history indicates that such person is not of Good Moral Character; (vii) the Applicant or Cannabis Permittee fails to allow inspection by City officials of the security recordings, activity logs, business records, or other accessible records pertaining to the activities conducted on the applicable Premises; or (viii) the Applicant or Cannabis Permittee allows for Physician Services to be conducted on the applicable Premises. (u) "Good Moral Character" means having a personal history that demonstrates the propensity to serve the public in a manner that reflects openness, honest, fairness, and respect for the law and rights and well-being of others. In determining Good Moral Character, the following standards shall apply: (i) a judgment of guilt in a criminal prosecution or a judgment in a civil action shall not be used, in and of itself, as proof of an individual's lack of Good Moral Character.

Such judgment, however, may be used as evidence in the determination and when so used, the individual shall be notified and shall be permitted to rebut the evidence by showing that, at the current time, he or she has the ability to, and is likely to serve the public, in a fair, honest, and open matter, that he or she is rehabilitated, and/or that the substance of the former offense is not substantially related to the applicable Commercial Cannabis Activity; and (ii) a prior conviction where the sentence, including any term of probation incarceration, or supervised release is completed for the possession of, possession for sale, sale, manufacture, transportation, or cultivation of a controlled substance, is not considered substantially related, and shall not be the sole ground for denial of a Cannabis Permit, except that any of the convictions set forth in Business and Professions Code Section 26057(b)(4), as may be amended, shall be deemed substantially related to applicable Commercial Cannabis Activity. (v) "Health and Safety Code" means the California Health and Safety Code, as amended from time to time.
(w) "Indoor" means within a Fully Enclosed and Secure Structure. (x) "Manufacture" or "Manufacturing" means to compound, blend, extract, infuse, or otherwise make or prepare a Cannabis Product from such blends, extractions, or infusions.

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(y) uManufacturing Permit" means a Cannabis Permit to Manufacture in accordance with the terms and conditions of this Chapter and the conditions of approval for the applicable Cannabis Permit issued to the particular Manufacturing Permittee.
(z) "Manufacturing Permittee" means a Person that has been issued a Manufacturing Permit by the City pursuant to the terms and conditions of this Chapter.
(aa) "Medicinal Permittee" means a Person who is issued a Cannabis Permit to engage in Commercial Cannabis Activity with respect to medicinal Cannabis in accordance with applicable City law and State Law, including MAUCRSA. (bb) "Microbusiness" means a commercial medicinal cannabis business facility of cultivation of medicinal cannabis on areas less than 10,000 square feet and also acts as a licensed distributor, manufacturer, and Delivery-only retailer, pursuant to State Law, including MAUCRSA. Microbusinesses shall not be open to the public for point-of-sale retail Cannabis sales.
(cc) "Microbusiness Permit" means a Cannabis Permit to establish and conduct a Microbusiness in accordance with the terms and conditions of this Chapter and the conditions of the Development Agreement for the applicable Cannabis Permit issued to the particular Microbusiness Permittee. (dd) "Microbusiness Permittee" means a Person who has been issued a Microbusiness Permit by the City pursuant to the terms and conditions of this Chapter.
(ee) "Outdoors" means any location within the City that is not within a Fully Enclosed and Secure Structure.
(ff) "Owner" means any of the following: (i) a Person with an aggregate ownership interest of 20% or more in the Person applying for a Cannabis Permit, unless the interest is solely a security, lien, or encumbrance; (ii) the chief executive officer of a nonprofit or other entity; a member of the boards of directors of a nonprofit; (iv) an individual who will be participating in the direction, control, or management of the person applying for a Cannabis Permit. (gg) "Permit Zone" means, with respect to a Person holding a Cannabis Permit, the overlay zone described in Cudahy Municipal Code Chapter 20.120 where such Cannabis Permit type is permitted to operate pursuant to a Development Agreement with the City.
(hh) "Person" includes any individual, entity, firm, co-partnership, joint venture, association, corporation, limited liability company, estate, trust, business trust, receiver, syndicate, or any other group or combination acting as a unit, and the plural as well as the singular.
(ii) "Physician Services" means the consultation by a State-licensed physician of a patient with the possible recommendation by such physician of medicinal Cannabis for such patient.

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OD "Premises" means the designated structure or structures and land specified in the application that is owned, leased, or otherwise held under the control of the Cannabis Permittee applicant or Cannabis Permittee where the Commercial Cannabis Activity will be or is conducted. The premises shall be a contiguous area and shall only be occupied by one Cannabis Permittee. (kk) "Retail Delivery" means the commercial transfer or delivery of Cannabis or Cannabis Products to a customer, patient, primary caregiver or Cannabis Permittee.
(II) "Retail Delivery Establishment" means a location where Cannabis or Cannabis Products are, either individually or in any combination, Delivered pursuant to State Law, including MAUCRSA. Retail Delivery Establishments shall not be open to the public for point-of-sale retail sales. (mm) "Retail Delivery Permit" means a Cannabis Permit to Deliver Cannabis and Cannabis Products to customers, patients, and primary caregivers in accordance with the terms and conditions of this Chapter and the conditions of the Development Agreement for the applicable Cannabis Permit issued to the particular Retail Delivery Permittee.
(nn) "Retail Delivery Permittee" means a Person that has been issued a Retail Delivery Permit by the City pursuant to the terms and conditions of this Chapter. (oo) "State" means the State of California.
(pp) "State Law" means all laws of the State of California, including, but not limited to, all rules and regulations adopted by State agencies and State regulatory entities, including subsequent amendments to such laws, rules, and regulations.
(qq) "State Medicinal license" means a State license for medicinal Commercial Cannabis Activities issued pursuant to State Law. (rr) "Testing" means the activities conducted by a Testing Laboratory. (ss) "Testing Laboratory" means an accredited laboratory, facility, or entity in the City that offers or performs tests of medicinal cannabis or medicinal cannabis products in accordance with State Law and City law:
(tt) "Testing Permit" means a Cannabis Permit for Testing the quality and makeup of Cannabis and Cannabis Products pursuant to the terms and conditions of this Chapter and the conditions of the Development Agreement for the applicable Cannabis Permit issued to the particular Testing Permittee. (uu) "Testing Permittee" means a Person who has been issued a Testing Permit by the City pursuant to the terms and conditions of this Chapter. (vv) "Volatile Solvent" means a Class I Flammable liquid as defined by the National Fire Protection Association, including butane and propane. (ww) "Youth Center" means any public or private facility that is primarily used to host recreational or social activities for minors, including, but not limited to,

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private youth membership organizations or clubs, social service teenage club facilities, video arcades, or similar amusement park facilities.

5.20.030 Commercial Cannabis Activity Prohibited.

All Commercial Cannabis Activity within the City is prohibited except as permitted by this Chapter.

5.20.040 Certain Commercial Cannabis Activity Permitted. Medicinal Commercial Cannabis Activities, except retail dispensaries that are open to the public for point-of-sale purchases, shall be allowed within the area set forth in the overlay zone/Permit Area illustrated in Exhibit "A" to City Council Ordinance No. 673 pursuant to a development agreement adopted in accordance with the Development Agreement Law (Gov. Code,§ 65864 et seq.) and Cudahy Municipal Code Chapter

20.28 (Development Agreements). No such activities shall be permitted without a Development Agreement within or outside of the boundaries of such overlay zone.

The City may approve or deny such a Development Agreement in its sole and absolute discretion. The City Manager is authorized to develop and promulgate policies and procedures consistent with the intent and spirit of this Chapter concerning the applications, application process, including, but not limited to, the information required of Applicants, and application review procedures, which shall inform the administration and protocols to be used and followed by the City in the application and hearing processes.

5.20.050 Business standards.

Commercial Cannabis Activity within the City shall be in conformance with the standards set forth in this Section, in addition to those additional standards that may be imposed through negotiated Development Agreement. The City Manager is hereby authorized to formulate and impose additional Business Requirements applicable to Cannabis Permittees in furtherance of the public health, safety, and/or welfare.
(a) Commercial Cannabis Activity shall only be allowed upon application and issuance of a Cannabis Permit and a Development Agreement by the City in accordance with the criteria and process set forth in this Chapter and City Code. (b) Zoning and Land Use.
(1) Operation Near Schools, Day Cares, and Youth Centers. Following the enactment of this Chapter, no new Premises shall be established, developed, or operated within 600 feet of a Day Care Center, Youth Center, or public or private school providing instruction in kindergarten or any grades 1 through 12 that is in existence at the time the Cannabis Permit is issued. All distances shall be measured in a straight line, without regard to intervening structures, from the nearest point of the building or structure in which the Premises are, or will be, located to the nearest property line of those uses describe in this Subsection. The restrictions set forth in this Subsection shall not apply to Premises which operate within 600 feet of any Day Care Center, Youth Center, or public or private school

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providing instruction in kindergarten or any grades 1 through 12, if such Premises existed prior to the establishment of the applicable Day Care Center, Youth Center, or school that is located within 600 feet of such Premises.
(2) Co-Location. All Commercial Cannabis Activity shall fully comply with all l mandates set forth in State Law. To the extent not prohibited under State Law, a Cannabis Permittee may be located within the same unit of the same Premises or building, facility or real property parcel as another Cannabis Permittee.
(3) Development Agreement.
a) Prior to commencing operations, all Cannabis Permittees shall enter into a Development Agreement with the City.
b) All Premises shall be operated in accordance with the terms of the applicable Development Agreement for the specified parcel of real property (or sub-portion thereof) upon which the Premises is located. c) Except as specified, Commercial Cannabis Activities shall not exceed the square footage authorized pursuant to the applicable Development Agreement.
d) All Premises shall be located in the Permit Zone pursuant to the applicable Development Agreement.
(c) Commercial Cannabis Activity is allowed only within Fully Enclosed and Secure Structures that are inaccessible to minors.
(d) Signage for any business must be applied for through the City's Planning Division, which shall require review and approval prior to installation. Business identification signage shall be limited to that needed for identification only, and shall not contain any logos or information that identifies, advertises, or lists the services or the products offered. No Cannabis Permittee shall advertise by having a person holding a sign and advertising the business to passersby, whether such person is on the Premises of the Cannabis Permittee or elsewhere including, but not limited to, the public right-of-way. (e) From any public right-of-way, there shall be no visible evidence of the consumption of any Cannabis Products. Commercial Cannabis Activity shall not adversely affect the health or safety of the nearby residents by creating dust, glare, heat, noise, smoke, traffic, vibration, odor or other impacts, and shall not be hazardous due to use or storage of materials, processes, products, or wastes. (f) Hours of operation limits, if any, shall be specified in terms mutually agreed upon in a Development Agreement.
(g) All Cannabis and Cannabis Products shall be kept in a secured manner during all business and nonbusiness hours.
(h) All Commercial Cannabis Activities shall operate within Premises that are compliant with all applicable State Laws and local laws.

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(i) Cannabis Permittees must pay all applicable taxes pursuant to all federal, State, and local laws, including, but not limited to, fees relating to infrastructure improvements within the Permit Zone.

U) Cannabis Permittees shall provide sufficient odor absorbing ventilation and exhaust systems so that odors outside the applicable Premises are not a nuisance on any adjacent property of public right-of-way. Any violation of this Section shall be remedied within thirty (30) days of the Cannabis Permittee receiving notice of such violation.
(k) Cannabis Permittees shall utilize product and inventory tracking software and accounting software that is consistent with reasonable business practices within the industry and the seed-to-sale tracking software being developed by the State. (I) Except permitted in this Chapter, on-site smoking, ingestion, or consumption of Cannabis or Cannabis Products shall be prohibited on Premises. Except to the extent otherwise permitted pursuant to this Chapter, the entrance of the Premises shall be clearly and legibly posted with a notice indicating that smoking, ingesting, or consuming Cannabis, Cannabis Products or alcohol on such Premises is prohibited.
(m) Signage for all Premises shall be in compliance with the City's sign code and application for all signs must be submitted to the City's Planning Division and comply with its sign permitting protocol.
(n) Alcoholic beverages and tobacco shall not be sold, stored, distributed, or consumed on the Premises. Cannabis Permittees shall not hold or maintain a license from the State Department of Alcohol Beverage Control to sell alcoholic beverages, or operate a business that sells alcoholic beverages or tobacco with respect to the Premises. In addition, alcohol shall not be provided, stored, kept, located, sold, dispensed, or used on the Premises.
(o) Physician Services shall not be provided at any Premises. (p) The Premises shall fully comply with all applicable rules, regulations, and laws including, but not limited to, zoning and building City Codes, the City's business license ordinances, the Revenue and Taxation Code, the Americans with Disabilities Act, and MAUCRSA.
(q) Each Cannabis Permittee shall provide the City Manager, or the City Manager's designee, with the name, phone number, facsimile number, and email address of an on-site representative of such Cannabis Permittee to whom the City and the public can provide notice if there are any operational problems associated with such Cannabis Permittee's Premises. Each Cannabis Permittee shall make reasonable and good faith efforts to encourage residents and the public to call this representative to resolve any operational problems before any calls or complaints are made to the City or law enforcement. (r) All Cannabis Permittees must comply with the following security requirements:
(1) General Security Requirements.

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a) Security cameras shall be installed and maintained in good working condition and used in a format approved by the City Manager. The cameras shall be in use 24 hours per day, 7 days per week. The areas to be covered by the security cameras include areas as determined by the City Manager, including, but not limited to, the area in which the primary Commercial Cannabis Activity occurs, e.g. the Cultivation area for a for a cultivator.
b) The Premises shall be alarmed with a reliable commercial alarm system that is operated and monitored by a security company or alarm business in a manner satisfactory to the City Manager.
c) Entrance to any storage areas shall be locked at all times and under the control of staff of the Cannabis Permittee.
d) The business entrance(s) and all window areas shall be illuminated during evening hours. The Applicant shall comply with the City's lighting standards regarding fixture type, wattage, illumination levels, shielding, etc., and secure the necessary approvals and permits, as necessary. e) All windows on the Premises shall be appropriately secured with all Cannabis and Cannabis Products securely stored.
f) Each Cannabis Permittee shall implement track and trace protocols, as noted above in this Section, in order to prevent diversion of Cannabis or Cannabis Products.
g) All waste and disposal containers shall be locked at all times and stored ins a secure area and, at all times, under the control of the Cannabis Permittee.
(2) Security Alarm Systems - Minimum Requirements.
a) Each Premises shall have a security alarm system installed by a licensed alarm company on all perimeter entry points and perimeter windows.
b) Each Premises must ensure that its location is continuously monitored. Premises may engage the services of outside vendors to fulfill this requirement, such as a private security firm.
c) Each Premises shall maintain up to date and current records and existing contracts on the Premises that describe the location and operation of each security alarm system, a schematic of security zones, the name of the licensed alarm company, and the name of any vendor monitoring the Premises.
(3) Lock Standards. At a minimum, all points of ingress and egress shall be secured with commercial-grade, non-residential door locks. (4) Video Surveillance Requirements.

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a) Prior to exercising the privileges of a Cannabis Permit issued under this Chapter, an Applicant must install fully operational video surveillance and camera recording system. The recording system must record in digital format and meet the requirements outlined herein.
b) All video surveillance records and recording must be stored in a secure area that is only accessible to the management staff of the Cannabis Permittee.
c) Video surveillance records and recordings must be made available upon request to the City Manager or designee for a purpose authorized by this Chapter or for any other State or local law enforcement purpose. d) Video surveillance shall be held in confidence by all employees and representatives of the City Manager, except that the City Manager may provide such records and recordings to any State or local law enforcement agency for any purpose authorized under this Chapter for any State or local law enforcement purpose.
e) A sign shall be posted in a conspicuous place near each point of public access, which shall not be less than 12 inches wide and 12 inches long, composed of letters not less than one inch in height, stating that "All Activities Monitored by Video Camera" or "These Premises Are Being Digitally Recorded" or otherwise advising of all persons entering the Premises that a video surveillance and camera recording system is in operation and recording all activity as provided in this Section. f) The Premises shall utilize video surveillance equipment and a camera system that shall be remotely accessible by the City and Los Angeles County Sheriff's Department.
(5) Video Surveillance Equipment.
a) Video surveillance equipment shall, at a minimum, consist of digital or network video recorders, cameras capable of meeting the recording requirements described in this Section, video monitors, digital archiving devices, and a color printable capable of delivering still photos. b) All video surveillance systems must be equipped with a failure notification system that provides prompt notification to a Cannabis Permittee of any prolonged surveillance equipment interruption and/or the complete failure of the surveillance.
c) Cannabis Permittees are responsible for ensuring that all surveillance equipment is properly functioning and maintained so that the playback quality is suitable for viewing and the surveillance equipment is capturing the identity of all individuals and activities in the monitored Premises.
d) All video surveillance equipment shall have sufficient battery backup to support a minimum of four hours of recording in the event of a power outage.

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(6) Placement of Cameras and Required Camera Coverage.
a) Camera placement shall be capable of identifying activity occurring within 20 feet of all points of ingress and egress and shall allow for the clear and certain identification of any individual and activities on the Premises.
b) All entrances and exits to the Premises shall be recorded from both indoor and outdoor vantage points.
c) The system shall be capable of recording all pre-determined surveillance areas in any lighting conditions. If the Premises has a medicinal cannabis cultivation area, a rotating schedule of lighted conditions and zero-illumination can occur as long as ingress and egress points to those areas remain constantly illuminated for recording purposes.
d) Areas where medicinal cannabis is grown, tested, cured, manufactured, or stored shall have a camera placed in the room facing the primary entry door at a height that will provide a clear unobstructed view of activity without sight blockage from lighting hoods, fixtures, or other equipment.
e) Cameras shall also be placed at each location where weighing, packaging, preparation, tagging activities occur, or other distribution preparation activities occur.
f) At least one camera must be dedicated to record the access points to the secured surveillance recording area.
(7) Location and Maintenance of Surveillance Equipment. a) Surveillance recording equipment must be housed in a designated, locked, and secured room or other enclosure with access limited to authorized employees, the City Manager or designee, Los Angeles County Sheriff's Department, as authorized by this Chapter, other State or local law enforcement purpose, and service personnel or contractors. b) Premises must keep a current list of all authorized employees and service personnel who have access to the surveillance system and/or surveillance system room on the Premises. Premises must keep a surveillance equipment activity log on the Premises to record all service activity, including the identity of all individuals performing services on system service, the service date and time, and the reason for such service to the surveillance system.
c) Off-site monitoring and video recording storage of the Premises by an independent third party may be authorized so long as standards exercised at the remote location meets or exceeds all of the standards applicable to onsite monitoring.

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d) Each Premises located in a common or shred building must have a separate surveillance room/area that is dedicated to that specific Premises. The facility that does not house the central surveillance room is required to have a review station, printer, and map of camera placement on the Premises. All minimum requirements for equipment and security standards as set forth in this Section apply to such review station. (8) Video Recording Retention Requirements.
a) All camera views of all recorded areas must be continuously recorded 24 hours a day.
b) All surveillance recordings must be kept for a minimum of 30 days and be in a format that can be easily accessed for viewing. Video recordings must be archived in a format that ensures authentication of the recording as legitimately-capture video and guarantees that no alteration of the recorded image has taken place.
c) The surveillance system or equipment must have the capabilities to produce a color still photograph form any camera image, live, or recorded, of the Premises.
d) The date and time must be embedded on all surveillance recordings without significantly obscuring the picture. e) Time is to be measured in accordance with the official United States time established by the National Institute of Standards and Technology and the U.S. Naval Observatory at www.time.gov. f) After the 30-day surveillance retention schedule has lapsed, surveillance video recordings must be erased or destroyed prior to being discarded or disposed of for any other purpose. Surveillance video recordings shall not be destroyed if the Cannabis Permittee knows or should have known of a pending criminal, civil, or administrative investigation or any other proceeding sfor which the recording may contain relevant information.
(9) Other Records. All records applicable to the surveillance system and cannabis tracking system shall be maintained on the Premises. At a minimum, Premises shall maintain a map of the camera locations, directions of coverage, camera numbers, surveillance equipment maintenance activity log, user authorization list and operating instructions for the surveillance equipment.
(s) Audit. Each Cannabis Permittee shall maintain accurate books and records in an electronic format, which detail all revenues and expenses of the business, including, but not limited to, all assets and liabilities. On no less than an annual basis, or at any time upon reasonable request of the City, each Cannabis Permittee shall file a sworn statement detailing business activity during the previous 12-month period (or shorter period based upon the timing of the request). The statement shall include gross sales for each month and all

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applicable taxes and fees paid or due to be paid. On an annual basis, each owner and operator shall submit to the City a financial audit of the business's operations conducted by an independent certified public accountant. Each Cannabis Permittee shall be subject to a regulatory compliance review and financial audit as determined by the City Manager or designee. (t) Inspections. The City Manager, or designee, or Los Angeles County Sheriff's Department shall have the right to enter all Premises from time to time unannounced during a Cannabis Permittee's hours of operation for the purpose of making reasonable inspections to observe and enforce compliance with this Chapter, to inspect and copy records required to be maintained under this Chapter, or to inspect, view, and copy recordings made by security cameras, all without requirement for a search warrant, subpoena, or court order, and subject to appropriate fees, as specified in the Development Agreement, or adopted by the City.

5.20.060 Application and fee requirements.
(a) All applicants wishing to obtain a Cannabis Permit from the City shall file an application with the City upon a form approved by the City Manager and shall pay a permit application fee as established by the City. The fee may vary depending on the type of Cannabis Permit. The City Manager or designee may require and conduct background checks, as necessary, to process and evaluate Cannabis Permit applications.
(b) Prior to operating in the City, each Cannabis Permittee shall timely and fully pay all fees associated with the establishment of Commercial Cannabis Activity.

The fees shall be as set forth in the schedule and fees and charges established by the City Council, including, but not limited to, the following:
(1) Application fee for accepting a registration application, due and payable in full at the time an application is submitted;
(2) Processing fee for the cost to the City of processing an application and reviewing, investigating, and scoring each application in accordance with any evaluation system to determine eligibility for issuance of a Cannabis Permit, due and payable in full at the time a registration application is submitted;
(3) Permit issuance fee for the cost to the City of preparing a Development Agreement, Planning Commission and City Council review of the Development Agreement and the Cannabis Permit, and preparation and issuance of the Cannabis Permit, as authorized by the Cannabis Permit; (4) Amended registration fee for the cost to the City of reviewing amendments or changes to the registration form previously filed on behalf of an Applicant, due and payable in full at the time amendments or changes to any Cannabis Permit form is submitted to the City;

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(5) Permit renewal fee for the cost ot the City of processing an application to renew a Cannabis Permit, due and payable in full at the time application is made to renew a Cannabis Permit; and
(6) Any fees set forth in the applicable Development Agreement.

5.20.070 Permit conditions.
(a) A Cannabis Permit application may be denied and not awarded by the City if:
(1) The Applicant or the Applicant's agent(s) has made one or more false or misleading statements or omissions in the application or during the application process.
(2) The proposed Premises or Commercial Cannabis Activity at the Premises is not allowed by State Law or City law.
(3) The Applicant is not a legal representative of the proposed Cannabis Permittee.
(4) The Applicant or any of its officers, directors, owners, managers, or employees is under 21 years of age.
(5) The Applicant's facility or its location is in violation of any building, zoning, health, safety, or other provision of this Chapter or of any State or local law that substantially affects the public health, welfare, safety, or morals, or the facility or its location is not permitted in the proposed area, or the issuing or continuation of a Cannabis Permit would be contrary ro the public health, welfare, safety, or morals.
(6) The Applicant or any of its officers, directors, owners, managers, or employees has been sanctioned by the City, State, or any county for unauthorized cannabis activities or has had a registration revoked under this Chapter in the previous 3 years.
(7) The Applicant or the Applicant's agent(s) have engaged in unlawful, fraudulent, unfair, or deceptive business acts or practices. (8) The Applicant has not been or is not in good standing with the City related to other or previous business activities operated in the City. (9) The Applicant has not satisfied all requirement of this Chapter. (10) For Good Cause, as defined in this Chapter.
(b) A Cannabis Permit shall be awarded by the City to Applicants in accordance with the process established by the City Manager.
(c) Before a Cannabis Permit can be issued to an applicant, a Cannabis Permit fee must be paid to offset all related costs to the City, and the proposed Premises must pass all applicable inspections.

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(d) Each Cannabis Permit is subject to the conditions of approval in the applicable Development Agreement for the parcel of real property upon which the Premises is located.
(e) Each Cannabis Permit is subject to any additional conditions that may be applied by the City at the time of issuance or renewal as necessary to properly regulate the applicable Commercial Cannabis Activities and to protect the public. (f) Each Cannabis Permittee shall execute a Development Agreement with the City to, among other things, fully reimburse the City for all fiscal impacts, costs, expenses, fees, and attorneys' fees incurred by the City related to the Cannabis Permit and the related Commercial Cannabis Activity of such Cannabis Permittee.
(g) Each Cannabis Permittee shall:
(1) Carry liability insurance in the amounts and types set by the City Manager or the City Manager's designee, and name the City as an additional insured on all such insurance policies.
(2) Execute an Indemnification Agreement prepared by the City that fully indemnifies the City for all liabilities associated with the Cannabis Permit, the Cannabis Permittee's Commercial Cannabis Activities, and any action taken by the Cannabis Permittee pursuant to this Chapter. Such indemnification may be set forth in the applicable Development Agreement.
(3) Defend the City, at the Cannabis Permittee's sole expense, in any action against the City or its agents, officers, officials, or employees associated with the Cannabis Permit, the Cannabis Permittee's Commercial Cannabis Activities, or any action taken by the Cannabis Permittee pursuant to this Chapter. The City may, at its sole discretion, participate in the defense of any such action, but such participation shall not relieve the Cannabis Permittee of its indemnification and reimbursement obligations. (4) Reimburse the City for all costs, expenses, fees, and attorney's fees incurred by the City related to any action against the City or its agents, officers, or employees associated with the Cannabis Permit, the Cannabis Permittee's Commercial Cannabis Activity, or any action taken by the Cannabis Permittee pursuant to this Chapter.
(h) A Cannabis Permittee shall keep the City and law enforcement updated with the names, addresses, and relevant criminal histories of the Applicant's Agents.

Relevant criminal histories shall include any drug-related or felony convictions, the nature of such offenses, and the sentences received for such convictions. (i) Transfer.
(1) Any Cannabis Permittee may not sell, transfer, pledge, assign, grant an option, or otherwise dispose of his or her ownership interest in the Commercial Cannabis Business authorized pursuant to the Cannabis Permit.

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(2) In order for a Cannabis Permittee to transfer its Cannabis Permit to any Person, such Cannabis Permittee must submit a transfer application to the City Manager or City Manager's designee. The City Manager or designee may create a transfer application and reasonable transfer application process, including mandatory fee, that Cannabis Permittees and the City must follow and pay for Cannabis Permit transfer requests. Each transfer request of a Cannabis Permit and the related transfer application is subject to the prior approval of the City Manager or designee. (3) Applicants for Cannabis Permits must show proof of lawful possession of the applicable location. Evidence of lawful possession consists of properly executed deeds of trust, leases, and other written instruments, as may be accepted by the City.
(4) The location shall only be the geographical area that is specifically and accurately described in executed documents verifying lawful possession.

No Cannabis Permittee is authorized to relocate to other areas or units within a building structure without first filing a change of location application and obtaining approval form the City regardless of any possessory interest or right to possession to such additional space. No Cannabis Permittee shall add additional contiguous units or areas, thereby altering initially-approved Premises without filing an application to modify the location on forms prepared by the City Manager, including any applicable processing fee.
(5) No Cannabis Permittee is authorized to sublet any portion of any Premises for any purpose unless all necessary forms and applications to modify the existing location to accomplish any subletting have been approved by the City.
(6) The City Manager shall develop and promulgate a process for the renewal of Cannabis Permits and the establish related fees, in accordance with applicable laws.

U) To the fullest extent permitted by law, the City does not assume any liability, and expressly does not waive sovereign immunity, with respect to any Commercial Cannabis Activities, or for the other activities of any Cannabis Permittee or for any other activities taking place at Premises. (k) Changing, Altering, or Modifying Location.
(1) After issuance of a Cannabis Permit, the Cannabis Permittee shall not make any physical change, alteration, or modification to the Premises that materially or substantially alters the location, production estimates, and/or usage of the location form the plans originally approved under the applicable Development Agreement, without the prior written approval of the City Council or designee. The Cannabis Permittee whose Premises are to be materially or substantially changed is responsible for filing an application with the City in order to obtain requisite approval.

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(2) Material or substantial changes, alterations, or modifications requiring approval include, but are not limited to, the following: (i) an increase or decrease in the total physical size or capacity of the location; (ii) the sealing off, creation of or relocation of a common entryway, doorway, passage, or other such means of public ingress and/or egress, when such common entryway, doorway, or passage alters or changes limited access areas; or (iii) the installation or replacement of electric fixtures or equipment, the lowering of a ceiling, or electrical modifications made for the purpose of increasing power usage ..
(3) The City Council or designee may grant approval for the types of changes, alterations, or modifications described herein upon the filing of an application by the Cannabis Permittee and payment of any applicable fee, subject to any requisite amendments to the applicable Development Agreement. The Cannabis Permittee must submit all information requested by the City Council or designee including, but not limited to, documents that verify the following: (i) the Cannabis Permittee will continue to have the exclusive possession of the Premises, as changed, by ownership, lease, rental agreement, or other means, and sole control over all activities; and (ii) the proposed change conforms to any and all City restrictions related to the time, manner, and place of regulation of the applicable Commercial Cannabis Activity.
(I) To the fullest extent permitted by law, the City does not assume any liability, and expressly does not waive sovereign immunity, with respect to any Commercial Cannabis Activities, or for the other activities of any Cannabis Permittee or for any other activities taking place at Premises.

5.20.080 Enforcement and Appeals.
(a) Any Commercial Cannabis Activity within the City in violation of this Chapter is hereby declared to be unlawful and a public nuisance. (b) Any Person who willfully or knowingly (i) engages in a violation of this Chapter or (ii) owns, possesses, controls, or has charge of any parcel of real property in the City upon which a violation of this Chapter is maintained and who has actual knowledge of such violation ( or would have actual knowledge of such violation after a reasonable inquiry), shall be subject to the penalties and remedies provided by this Chapter.
(c) Any violation of this Chapter shall constitute a separate offense for each and every day the violation occurs or persists.
(d) Any Person in violation of any provision of this Chapter or who causes another Person to be in violation of this Chapter shall have committed a misdemeanor. In addition which shall be punishable by a fine of up to one thousand dollars ($1,000) for each violation and for each day the applicable violation continues to persist.

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(e) Any person in violation of any provision of this Chapter shall be punishable by an administrative fine of up to a $1,000 per offense.
(f) Any material violation of this Chapter or any other relevant City law or State Law by a Cannabis Permittee, or a Cannabis Permittee's agent, is grounds for suspending or revoking the relevant Cannabis Permit. In addition, the City Manager or the City Manager's designee may suspend or revoke a Cannabis Permit, disqualify an Applicant from the application process, or elect not to renew a Cannabis Permit if any of the following occur:
(1) The City Manager or the City Manager's designee determines that the Cannabis Permittee has failed to comply with this Chapter, any condition of approval, or any agreement or covenant as required pursuant to this Chapter.
(2) The Cannabis Permittee's Commercial Cannabis Activities cease for more than ninety (90) calendar days.
(3) Ownership of the Cannabis Permittee is changed without approval from the City.
(4) The licensed Commercial Cannabis Activity moves from the licensed Premises to a different, unauthorized location.
(5) The Cannabis Permittee fails to provide remote access to the security cameras to the City Manager, the City Manager's designee, or Los Angeles County Sheriff's Department, or fails to allow inspection of the security recordings, the activity logs, or of the Premises by authorized City officials.
(g) Any decision regarding the suspension or revocation of a Cannabis Permit, disqualification of an Applicant from the application process, or election not to renew a Cannabis Permit may be appealed to an independent neutral third-party administrative hearing officer appointed by the City Manager or the City Manager's designee (the "Hearing Officer"). Said appeal shall be made by a notice of appeal from the Person appealing within thirty (30) days from the date of the City's decision. The appeal shall be accompanied by a written verified declaration setting forth the basis for the claim that the City's decision was improper. The Hearing Officer's decision shall be final and binding upon the City and the appellant Cannabis Permittee or Applicant. Alternatively, the City Manager may provide for the appeal to be made to the City Council, in lieu of a hearing officer. In such case, the City Council's decision shall be final and binding upon the City and the appellant.
(h) These penalties and remedies are cumulative, and in addition to any other penalties and remedies available to the City.

5.20.090 State Medicinal License Requirement.
(a) Cannabis Permittees must obtain a State Medicinal License in accordance with State Law, including, but not limited, to the temporary and permanent State Medicinal Licenses provided for in MAUCRSA.

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(b) Each Cannabis Permittee must expeditiously provide proof of receipt of the applicable State Medicinal License by such Cannabis Permittee to the City Manager or designee.

5.20.100 Medicinal Cannabis Cultivation.
(a) Purpose. The purpose and intent of this Section is to permit and regulate the medicinal Cannabis Cultivation in order to promote the health, safety, morals, and general welfare of the residents and businesses within the City. The City is authorized to regulate this activity pursuant to State Law. (b) Scope; Medicinal Cannabis. This Section permits and regulates the medicinal Cannabis Cultivation pursuant to State Law, including MAUCRSA.

Subject to the terms of this Chapter, Cultivation Permits may be issued by the City for medicinal Cannabis Cultivation pursuant to and in accordance with State Law, including MAUCRSA.
(c) Outdoor Cultivation is prohibited within the City.
(d) Indoor Cultivation is permitted only on properties within the applicable Permit Zone with a valid Cultivation Permit and other requisite permits and entitlements. (e) Indoor Cultivation may include growing Cannabis plants, harvesting Cannabis plants, and drying Cannabis flowers but shall not include the Manufacturing or of Cannabis Products, unless otherwise authorized pursuant to this Chapter. (f) Entrance to the Cultivation area, and all storage areas, of the applicable Premises shall be locked at all times and under the control of the staff of such Premises.

5.20.110 Medicinal Cannabis Products Manufacturing.
(a) Purpose. The purpose and intent of this Section is to permit and regulate the medicinal Cannabis Products Manufacturing to promote the health, safety, morals, and general welfare of the residents and businesses within the City. The City is authorized to regulate this activity pursuant to State Law. (b) Scope; Medicinal Cannabis. This Section permits and regulates medicinal Cannabis Products Manufacturing pursuant to State Law, including MAUCRSA.

Subject to the terms of this Chapter, Manufacturing Permits may be issued by the City for medicinal Cannabis Products Manufacturing, pursuant to and in accordance with State Law, including MAUCRSA.
(c) Medicinal Cannabis Products Manufacturing is a permitted use only on properties within the applicable Permit Zone with a valid Cultivation Permit and other requisite permits and entitlements.
(d) A Manufacturing Permittee must employ at least one (1) member of its personnel dedicated full time to quality control.
(e) The Manufacturing Permittee must establish standard operating procedures and batch records that comply with current good manufacturing practices and applicable State Law, including MAUCRSA.

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(f) All Cannabis Products produced by a Manufacturing Permittee must be labeled in compliance with applicable State Law, including MAUCRSA. (g) All Cannabis Products produced by a Manufacturing Permittee must be packaged in child resistant containers prior to leaving the Premises fOf such Manufacturing Permittee in accordance with applicable State Law, including MAUCRSA.
(h) Manufacturing Permittees may conduct Manufacturing using any type of solvents, including Volatile Solvents, or Manufacturing processes if such Manufacturing complies with the requirements of this Chapter and State or local law, including but not limited to Health and Safety Code Section 11362.775 (or any successive State Law) all applicable fire and building codes in the City and any other laws of the City designed to ensure the safety of such operation. (i) Manufacturing Permittees using Volatile Solvents for Manufacturing Cannabis Products must operate in a manner to reduce the risk of explosion or danger to public health, including through the use of a close-loop · or solvent dispersion system consistent with the requirements of Health and Safety Code Section 11362.775 (or any successive State Law).

U) If hazardous materials, flammable gas, flammable liquefied gas, flammable and combustible liquids, or other flammable material, as those terms are defined in California Fire Code Section 202, are to be used in the processing of medicinal Cannabis, then the provisions of California Fire Code Section 407 shall be applicable where hazardous materials are subject to permits under California Fire Code Section 50 (Hazardous Materials) are located on the Premises or where required by the applicable building or fire official.
(k) Storage, use, and handling of compressed gases in compressed gas containers, cylinders, tanks, and systems shall comply with California Fire Code Chapter 53. Partially full compressed gas containers, cylinders, or tanks containing residual gases shall be considered as full for the purposes of the controls required. Compressed gases classified as hazardous materials shall also comply with California Fire Code Chapter 50 for general requirements and California Fire Code Chapter 53 addressing specific hazards, including California Fire Code Chapter 58 (Flammable Gases), California Fire Code Chapter 60 (Highly Toxic and Toxic Materials), California Fire Code Chapter 63 (Oxidizers, Oxidizing Gases and Oxidizing Cryogenic Fluids, and California Fire Code Chapter 64 (Pyrophoric Materials). Prevention, control, and mitigation of dangerous conditions related to storage, use, dispensing, mixing, and handling of flammable and combustible liquids shall be in accordance with California Fire Code Chapters 50 and 57.
(I) Labeling Requirements - Edibles.
(1) Before a Manufacturing Permittee prepares any edible Cannabis or edible Cannabis Product for retail sale, it shall be labeled and placed in tamperevident packaging which at least meets the requirements of State Law, including, but not limited to, MAUCRSA.

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(2) All items to be sold or distributed shall be individually wrapped at the original point of preparation by the Cannabis Permittee. (3) Labeling must include a warning if nuts or other known allergens are used, and must include the total weight (in ounces or grams) of Cannabis in the package, not to exceed ten (10) milligrams of tetrahydrocannabinol (THC) per serving.
(4) A warning that the item is a medication and not a food must be clearly legible on the front of the package and/or must comply with state packing requirements.
(5) The package must have a label warning that the product is to be kept away from children.
(6) The label must also state that the product contains Cannabis and must specify the date of Manufacture and the Manufacture Permittee's information, including, but not limited to, address, and phone number. (7) Distributions must be in a properly labeled opaque package when distributed.
(8) The City Manager, or designee, may impose additional packaging and labeling requirements on Cannabis or Cannabis Products.

5.20.120 Medicinal Cannabis and Cannabis Products Retail Delivery (Retail Delivery Only, Dispensaries Prohibited).
(a) Purpose. The purpose and intent of this Section is to regulate the Retail Delivery of medicinal Cannabis and Cannabis Products in order to promote the health, safety, and general welfare of the residents and businesses within the City. The City is authorized to regulate this activity pursuant to the State Law. (b) Scope; Medicinal Cannabis Only. This Section permits and regulates the Retail Delivery of medicinal Cannabis and Cannabis Products pursuant to State Law, including MAUCRSA. Subject to the terms of this Chapter, Retail Delivery Permits may be issued by the City for the Retail Delivery of medicinal Cannabis and Cannabis Products pursuant to and in accordance with State Law, including MAUCRSA. The point-of-sale sale of Cannabis or Cannabis Products is strictly prohibited.
(c) Retail Delivery of Cannabis and Cannabis Products is a permitted use only on properties within the applicable Permit Zone with a valid Retail Delivery Permit and other requisite permits and entitlements.
(d) The Retail Delivery of medicinal Cannabis and Cannabis Products may only include the Retail Delivery of Cannabis and Cannabis Products by a Retail Delivery Permittee to a customer, patient or primary caregiver, in accordance with State Law, including MAUCRSA.
(e) Retail Delivery Permittees shall implement sufficient security measures to both deter and prevent unauthorized entrance into areas containing Cannabis

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and Cannabis Products and theft of Cannabis and Cannabis Products from the Retail Delivery Establishment or employees participating in Retail Delivery. (f) All Cannabis and Cannabis Products shall be stored in a secured and locked room, safe, or vault, and in a manner as to prevent diversion, theft, or loss. (g) Individuals shall not be allowed to remain on the Premises comprising of the Retail Delivery Establishment unless they are engaging in activity expressly related to the operations of the Retail Delivery Establishment or are a customer. (h) A Retail Delivery Permittee shall notify the City Manager or the City Manager's designee within 24 hours of discovering any of the following:
(1) Significant discrepancies identified during inventory. The level of significance shall be determined by the City Manager or the City Manager's designee.
(2) Diversion, theft, loss, or any criminal activity involving the Retail Delivery Establishment or any agent or employee of the Retail Delivery Establishment.
(3) The loss or unauthorized alteration of records related to Cannabis, Cannabis Products, registered qualifying patients, primary caregivers, or Retail Delivery Establishment agents or employees.
(4) Any other material breach of security.
(i) The Retail Delivery of medicinal Cannabis and Cannabis Products shall comply with all State and local Law, including all laws requiring presentment of government-issued identification card, physician's recommendation, or medicinal Cannabis identification card at the time of initial purchase.

U) With respect to medicinal Cannabis, physicians' recommendations for medicinal cannabis use shall be verified by a Retail Delivery Permittee prior to the Retail Delivery any medicinal Cannabis to a qualified patient or primary caregiver and at least every six months thereafter.
(k) A Retail Delivery Establishment may not employ or enter into any agreements with any physicians who recommend medicinal Cannabis; Physician Services are prohibited from any and all Retail Delivery Establishments. (I) A Retail Delivery Permittee shall inspect all Cannabis and Cannabis Products received for quality assurance prior to the Retail Delivery to any Person. (m) The Retail Delivery of Cannabis and Cannabis Products shall occur only after such Cannabis and Cannabis Products have been inspected and quality tested in accordance with applicable State Law, including MAUCRSA. (n) Each Retail Delivery Establishment shall do regular monthly inventories and record the total quantity of Cannabis and Cannabis on the Premises. These records shall be maintained for three years from the date created and shall be open to inspection by the City Manager, the City Manager's Designee, and law enforcement.

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(o) A Retail Delivery Permittee shall register with the City each location where Cannabis or Cannabis Products are stored for purposes of Retail Delivery by such Retail Delivery Permittee within the City.
(p) A Retail Delivery Establishment shall maintain customer and patient and other business records in a secure location (including electronically or cloud-based) j. that is compliant with, as applicable, HIPAA and other federal and state privacy laws.
(q) During the Retail Delivery of Cannabis or Cannabis Products, each vehicle driver shall carry a copy of the Retail Delivery Permit, a copy of the Retail Delivery request, a form of government-issued identification, and all other information required by State and local Law. The driver shall present these documents upon the request of law enforcement, the City Manager, or the City Manager's designee.
(r) Prior to Retail Delivery of Cannabis and Cannabis Products, such Cannabis and Cannabis Products shall be labeled and placed in a tamper-evident package.

Labels and packages of Cannabis and Cannabis Products shall, at minimum, meet the requirements specified under State Law, including MAUCRSA. (s) All Retail Delivery vehicles shall:
(1) Be equipped with, and utilize, a vehicle alarm system. (2) Have and utilize a direct communication system with the related Retail Delivery Establishment.
(3) Keep all Cannabis and Cannabis Products in a secure and locked container.
(4) Have an internal partition between the driver and all passengers from the Cannabis and Cannabis Products storage containers that prevents access by the driver and passengers to all cannabis products from inside the vehicle.
(5) Not carry more Cannabis and Cannabis Products than allowed by State and local Law and required to fulfill all immediate Retail Delivery requests (6) Not display any logo, signage, or other information that identifies, advertises, or lists the services or the products offered.

5.20.130 Medicinal Cannabis and Cannabis Products Distribution. (a) Purpose. The purpose and intent of this Section is to permit and regulate the Distribution of Cannabis and Cannabis Products between Cannabis Permittees in order to promote the health, safety, morals, and general welfare of the residents and businesses within the City. The City is authorized to regulate this activity pursuant to State Law.
(b) Scope; Medicinal Cannabis Only. This Section permits and regulates the Commercial Cannabis Activity of Distribution of medicinal Cannabis and Cannabis Products pursuant to State Law, including MAUCRSA. Subject to the terms of this Chapter, Distribution Permits may be issued by the City for the

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Distribution of medicinal Cannabis and Cannabis Products pursuant to and in accordance with State Law, including MAUCRSA. Distribution of Cannabis and Cannabis Products requires a Development Agreement with the City and must be located within the applicable Permit Zone. -,
(c) Distribution activities includes the receiving and releasing of Cannabis and Cannabis Products for inspection, Testing, and quality assurance, as required under applicable State Law and such other activities as are permitted pursuant to State Law.
(d) A Distribution Permittee shall only Distribute Cannabis and Cannabis Products between Cannabis Permittees or to facilities or portions of facilities wholly controlled by such Distribution Permittee to the extent permitted by State Law.
(e) A Distribution Permittee shall inspect all Cannabis and Cannabis Products received by it for quality assurance prior to Distributing to any Cannabis Permittee, as required under applicable State Law.
(f) In addition to the application requirements in Section 0, a Distribution Permittee shall register with the City each location within the City where Cannabis and Cannabis Products are stored for purposes of Distribution activities within the City.
(g) A Distribution Permittee shall Distribute Cannabis and Cannabis Products to Cannabis Permittees only after such Cannabis and Cannabis Products have been inspected and quality tested in accordance with applicable State Law, including MAUCRSA.
(h) A Distribution Permittee may also hold any other Permit type to the extent permitted by State Law. To the extent permitted by State law, a Distribution Permittee that also holds another Permit type may self-distribute its Cannabis Products.

5.20.140 Medicinal Cannabis and Cannabis Products Microbusiness. (a) Purpose. The purpose and intent of this Section is to permit and regulate the medicinal Cannabis and Cannabis Products Microbusiness in order to promote the health, safety, morals, and general welfare of the residents and businesses within the City. The City is authorized to regulate this activity pursuant to State Law, including MAUCRSA.
(b) Scope; Medicinal Cannabis Only. This Section permits and regulates Microbusinesses, pursuant to State Law, including MAUCRSA. Subject to the terms of this Chapter, Microbusiness Permits may be issued by the City pursuant to and in accordance with State Law, including MAUCRSA. (c) All Microrobusinesses shall require a Development Agreement with the City and must be located within the applicable Permit Zone.
(d) All components of a Microbusiness (i.e., Cultivation, Manufacturing, etc.) must be in compliance with the provisions of this Chapter and State Law, including MAUCRSA.

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(e) The City may authorize the smoking, vaporizing, and ingestion of Cannabis or Cannabis Products on the Premises of a Microbusiness if all of the following are met:
(1) Access to the area where Cannabis consumption is allowed is restricted to persons 21 years of age and older.
(2) Cannabis consumption is not visible from any public place or nonagerestricted area. (3) Sale or consumption of alcohol or tobacco is not allowed on the Premises.

5.20.140 Medicinal Cannabis and Cannabis Products Testing. (a) Purpose. The purpose and intent of this Section is to permit and regulate the Testing of medicinal Cannabis and Cannabis Products in order to promote the health, safety, morals, and general welfare of the residents and businesses within the City. The City intends to be on the forefront of medicinal Cannabis research and Testing. The City is authorized to regulate this activity pursuant to State Law.
(b) Scope; Medicinal Cannabis Only. This Section permits and regulates Cannabis and Cannabis Products Testing, pursuant to State Law, including MAUCRSA. Subject to the terms of this Chapter, Testing Permits may be issued by the City for the Testing of medicinal Cannabis and Cannabis Products pursuant to and in accordance with State Law, including MAUCRSA. (c) Testing of Cannabis and Cannabis Products requires a Development Agreement with the City and must be located within the applicable Permit Zone. (d) Each Testing Permittee must employ at least one (1) full time quality control personnel employee.
(e) Testing Permittees must operate, and all Cannabis and Cannabis Products must be properly tested by Testing Permittees, in accordance with applicable State Law.
(f) All Testing devices used by a Testing Permittee must be "UL listed," and/or otherwise approved for the intended use by the City's Building Official, the Fire Department or other person designated by the City Manager or designee. (g) Each Testing Permittee must notify the State Department of Public Health and the City Manager, or the City Manager's designee, within one business day after the receipt of notice of any kind that its accreditation has been denied, suspended, or revoked.

SECTION 10. Recognizing that there is a potential conflict between federal and State law, it is the City Council's intention that this Ordinance shall be deemed to comply with applicable State Law and shall defer to such applicable State Law through preemption.

SECTION 11. The City Council determines that it is in the best interest of the residents of the City to allow Commercial Cannabis Activities in compliance with applicable State Law, including MAUCRSA, to be established and operated as permitted uses within certain areas of the City subject to the regulations and restrictions provided in this

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Ordinance. It is the City Council's intention that nothing in this Ordinance shall be construed to:

1. Allow a Person to engage in conduct that endangers others or causes a public nuisance.

2. Allow any activity relating to Cannabis that is otherwise not permitted under State law.

SECTION 12. The City Council finds that the actions contemplated by this Ordinance are exempt from the California Environmental Quality Act pursuant to Section 15061 (b )(3) and 15305 of the Guidelines, in that the Ordinance alone does not have the potential for causing a significant effect on the environment. Further permits and approvals will be required before any activity that will affect the environment will be permitted. In addition, Business and Professions Code Section 26055 exempts local ordinances from CEQA that authorizes commercial cannabis activity through discretionary review and approval.

SECTION 13. If any section or provision of this Ordinance is for any reason held to be invalid, unconstitutional, illegal, or unenforceable by any court of competent jurisdiction, or contravened by reason of any preemptive legislation, then such section or provision shall be severed and shall be inoperative, and the remainder of this Ordinance shall remain in full force and effect.

SECTION 14. By regulating Commercial Cannabis Activity, the City is only undertaking to preserve the general welfare through implementing the MAUCRSA. The City Council is not assuming, nor is it imposing on its officers and employees, an obligation for which a breach thereof would expose the City to liability in money damages to any Person who claims that such breach proximately caused injury. To the fullest extent permitted by law, the City shall assume no liability whatsoever, and expressly does not waive sovereign immunity, with respect to any provision of this Ordinance or for the activities of any Cannabis Permittee. To the fullest extent permitted by law, any actions taken by a public officer or employee under the provisions of this Ordinance shall not become a personal liability of any public officer or employee of the City. Nothing in this Ordinance shall be deemed or considered in any respects to constitute authorization to violate any law.

SECTION 15. Inconsistent Provisions. Any provision of the Cudahy Municipal Code or appendices thereto inconsistent with the provisions of this Ordinance, to the extent of such inconsistencies and no further, is hereby repealed or modified to the extent necessary to implement the provisions of this Ordinance.

SECTION 16. Severability. If any section, subsection, subdivision, paragraph, sentence, clause or phrase of this Ordinance, or any part thereof is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance or any part thereof. The City Council hereby declares that it would have passed each section, subs,ection, subdivision, paragraph, sentence, clause or phrase thereof,

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irrespective of the fact that any one or more section, subsection, subdivision, paragraph, sentence, clause or phrase would be subsequently declared invalid or unconstitutional.

SECTION 17. Publication and Effective Date. The Mayor shall sign and the City Clerk shall attest to the passage of this Ordinance. The City Clerk shall cause the same to be published once in a newspaper of general circulation within fifteen (15) days after its adoption. This Ordinance shall become effective thirty (30) days after adoption.

PASSED, APPROVED AND ADOPTED by the City Council of the City of Cudahy at the / ." ,_, regular meeting of this 11th day of September, 2017. ,.,_,,,_ /4. ~VY

STATE OF CALIFORNIA

COUNTY OF LOS ANGELES

CITY OF CUDAHY
)
)
)
SS:

Chris Garcia
Mayor
I, Richard Iglesias, Deputy City Clerk of the City of Cudahy, hereby certify that the foregoing Ordinance No. 673 was introduced for a first reading on the 14th day of August 2017 and approved for a second reading and adopted by said Council at its regular meeting held on the 11th day of September, 2017 by the following vote, to-wit:

AYES: Markovich, Hernandez, Garcia
)
I
l
NOES: Guerrero
ABSTAIN: None
ABSENT: Sanchez
.. --;' ~ j ~~----'~ -

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Richard lgles~a~ / 7 · · · ·-:---___ __
Deputy City B r:I<
ATTACHMENT B Page 2809 of 3559
EXHIBIT "A": OVERLAY ZONE
IIABI! NA~ l'!ATIJRl!B
,-.... I._.J Cuclohy Boundary
-Railroad, EXISTING ZONING - Boundaries of Overlay Zone .,r Portion of High Density Residential Zone which shall be available for Medicinal Commercial Cannabis Activity upon rezoning by the City Council by General Plan Amendment, Zoning Map Amendment, or other means.

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CUDAHY GENERAL PLAN
ATTACHMENT B Page 2810 of 3559

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j
ORDINANCE NO. 701

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
CUDAHY, CALIFORNIA, APPROVING: (1) A DEVELOPMENT
AGREEMENT [NO. DA18-014C] BY AND BETWEEN THE CITY OF

CUDAHY AND ST AR CRAFT, LLC, A CALIFORNIA LIMITED
LIABILITY COMPANY AND (2) THE ISSUANCE OF A COMMERCIAL

CANNABIS PERMIT
WHEREAS, to strengthen the public planning process, encourage private participation in comprehensive planning and reduce the economic risk of development, the Legislature of the State of California adopted Section 65864 et seq. of the California Government Code (the Development Agreement Statute"); and
WHEREAS, the Development Agreement Statute authorizes the City to enter into a property development agreement with any person having legal or equitable interest in real property for the development of such property in order to establish certain development rights; and WHEREAS, in accordance with California law, the City of Cudahy has adopted Municipal Code Chapter 20.28 (Development Agreements) [Renumbered as Part 9 of the Zoning Code §20.84.530-20.84.640 adopted by the City Council on 7/17/18] establishing the procedures and requirements for the consideration of development agreement with the City; and WHEREAS, on September 11, 2017, the City Council for the City of Cudahy passed Ordinance No. 673 establishing regulations and a discretionary review process for the allowance of medicinal-only commercial cannabis activities (cultivation, distribution, manufacturing, deliveries, micro-business and laboratory testing) in a specified Overlay Zone through a development agreement; and
WHEREAS, all procedures of the California Environmental Quality Act ("CEQA"), California Public Resources Code §21000 et seq., and the CEQA guidelines, title 14 of the California Code of Regulations, chapter 3, §15000 et seq. have been satisfied. The City has found that the proposed Project is Categorically Exempt from California Environmental Quality Act (CEQA) requirements under provisions of CEQA Guidelines Section 15301 - Existing Facilities.

This exemption applies to projects characterized as alterations to existing facilities meeting the conditions described in Section 15301;
WHEREAS, the City of Cudahy Planning Commission ("Planning Commission") conducted a properly noticed public hearing to consider approval of a Commercial Cannabis Permit and a Development Agreement (as defined below), at which testimony and evidence, both written and oral, were presented to and considered by the Planning Commission; and WHEREAS, the City Council shall approve a development agreement by ordinance; and WHEREAS, subsequent to receipt of report on the Planning Commission's actions, the City Council conducted a properly noticed public hearing to consider the approval of a Commercial Cannabis Permit and Development Agreement, at which testimony and evidence, both written and _j
ATTACHMENT D Page 2820 of 3559
Oi·dirnmce No. 70 I

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oral, were presented to and considered by the City Council.

NOW THEREFORFE, THE CITY COUNCIL OF THE CITY OF CUDAHY · DOES ORDAIN AS FOLLOWS:

SECTION 1. RECITALS
That the above Recitals are true and correct and are incorporated as though fully set forth herein.

SECTION 2. APPROVAL OF DEVELOPMENT AGREEMENT
That the City Council hereby approves the Development Agreement By and Between the City of Cudahy and Starcraft, LLC, a California limited liability company ("Development Agreement") [DA#18-014C], a copy of which is attached hereto and incorporated herein by this reference as Exhibit "A," subject to the terms and conditions stated therein.

SECTION 3. APPROVAL OF COMMERCIAL CANNABIS PERMIT
That the City Council hereby approves Commercial Cannabis Permit No. CCP18-0014, subject to the terms and conditions stated therein, to allow a Commercial Cannabis Facility for the Site located at4925 Cecelia Street, City of Cudahy, CA as set forth in the Development Agreement. A copy of the permit is attached hereto and incorporated herein by this reference as Exhibit "B." The Commercial Cannabis Permit shall be issued upon execution by the City of the Development Agreement.

SECTON 4. SEVERABILITY
That the City Council declares that, should any provision, section, paragraph, sentence or word of this Ordinance be rendered or declared invalid by any final court action in a court of competent jurisdiction or by reason of any preemptive legislation, the remaining provisions, sections, paragraphs, sentences or words of this Ordinance as hereby adopted shall remain in full force and effect.

SECTION 5. EFFECTIVE DATE OF ORDINANCE
That this Ordinance shall take effect thirty (30) days after its second reading by the City Council.

SECTION 6. EXECUTION OF DEVELOPMENT AGREEMENT
The Development Agreement shall not be executed by the City until on or after the effective date of the Ordinance.

SECTION 7. RECORDATION OF DEVELOPMENT AGREEEMENT
That the City Clerk is hereby directed to record the fully executed Development ATTACHMENT D Page 2821 of 3559
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Ordinance No. 70 l
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Agreement with the County Recorder for the County of Los Angeles no later than ten (10) days after its execution.

SECTION 8. CERTIFICATION
That the City Clerk shall certify to the passage of this Ordinance and shall cause the same to be published, in full or in summary format, according to law.

PASSED, APPROVED AND ADOPTED by the City Council of the City of Cudahy at the regular meeting of this 18th day of December, 2018.

ATTEST:
. L -~~-- - -- -
kichard Iglesias/ 0 /
Deputy City C~k
Chris Garcia
Mayor
ATTACHMENT D Page 2822 of 3559
Ordim:nce No. 7() I

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STATE OF CALIFORNIA

COUNTY OF LOS ANGELES

CITY OF CUDAHY
)
)
)

CERTIFICATION
SS:

I, Richard Iglesias, Deputy City Clerk of the City of Cudahy, hereby certify that the foregoing Ordinance No. 701 was introduced for a first reading on the 4th day of December, 2018 and approved for a second reading and adopted by said Council at its regular meeting held on the 18th day of December, 2018 by the following vote, to-wit:

AYES: Gonzalez, Hernandez, and Garcia
NOES: Sanchez
ABSENT: None
ABSTAIN: Markovich
~~~
---=---7
Richard Iglesi~ /
Deputy City Clerk
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J
ATTACHMENT D Page 2823 of 3559
Orcl in1:1.nce No. 70 l

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EXHIBIT II A II

DEVELOPMENT AGREEMENT

BY AND BETWEEN

THE CITY OF CUDAHY

AND STARCRAFT, LLC

A CALIFORNIA LIMITED LIABILITY COMPANY

SEE ATTACHMENT
ATTACHMENT D Page 2824 of 3559
Ordinai1ce No. 701

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Cudahy City CouncilJuly 16, 2024

Cudahy City Council
July 16, 2024