Cudahy City Council
March 18, 2025

Administrative Review Record - Aqua Tergere, LLC

EXHIBIT F

CONDITIONS OF APPROVAL

Administrative Review Record - Aqua Tergere, LLC

CONDITIONS OF APPROVAL – EXHIBIT F
COMMERCIAL CANNABIS PERMIT NO, CCP18-0011
DEVELOPMENT AGREEMENT NO. DA18-011C
8210 ATLANTIC AVENUE – AQUA TERGERE, LLC

GENERAL CONDITIONS OF APPROVAL
Condition of Approval No. 1 - Financial Responsibility for Compliance Monitoring and Enforcement
a. Cost Responsibilities: The Permittee shall bear the full costs of all City staff time, materials, and City-retained consultants associated with condition compliance review and monitoring, CEQA mitigation monitoring, other permit monitoring programs, and enforcement activities, actions, and processes conducted pursuant to the City of Cudahy Municipal Code (§ 5.20.060) related to this Commercial Cannabis Permit (CCP) and Development Agreement (DA). Such condition compliance review, monitoring and enforcement activities may include (but are not limited to): periodic site inspections; preparation, review, and approval of studies and reports; review of permit conditions and related records; enforcement hearings and processes; drafting and implementing compliance agreements; and attending to the modification, suspension, or revocation of permits. Costs will be billed at the rates set forth in the Planning Division or other applicable City Fee Schedule, and at the contract rates of City-retained consultants, in effect at the time the costs are incurred.

Establishment of Compliance Account: Within 10 calendar days of the effective date of the final decision approving this CCP, the Permittee shall submit a new, updated, and completed reimbursement agreement for Condition Compliance Case No. CCP18-0011 in a form provided by the City, obligating the Permittee to pay all condition compliance review, monitoring, and enforcement costs, and any civil administrative penalties, subject to the Permittee’s right to challenge all such charges and penalties prior to payment.
b. Billing Process: The Permittee shall pay all City invoices within 30 days of receipt thereof. Failure to timely pay an invoice shall subject the Permittee to late fees and charges set forth in the City Fee Schedule, and shall be grounds for suspension, modification, or revocation of this CCP. The Permittee shall have the right to challenge any charge or penalty prior to payment.

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Condition of Approval No. 2 - Defense and Indemnification a. The Permittee shall defend, at the Permittee's sole expense with legal counsel acceptable to the City, against any and all claims, actions, or proceedings against the City, any other public agency with a governing body consisting of the members of the City Board of Supervisors, or any of their respective board members, officials, employees and agents (collectively, “Indemnified Parties”) arising out of or in any way related to the City’s issuance, administration, or enforcement of this CUP. The City shall promptly notify the Permittee of any such claim, action or proceeding and shall cooperate fully in the defense. b. The Permittee shall also indemnify and hold harmless the Indemnified Parties from and against any and all losses, damages, awards, fines, expenses, penalties, judgments, settlements, or liabilities of whatever nature, including but not limited to court costs and attorney fees (collectively, “Liabilities”), arising out of or in any way related to any claim, action or proceeding subject to subpart (a) above, regardless of how a court apportions any such Liabilities as between the Permittee, the City, and/or third parties.
c. Except with respect to claims, actions, proceedings, and Liabilities resulting from an Indemnified Party’s sole active negligence or intentional misconduct, the Permittee shall also indemnify, defend (at Permittee’s sole expense with legal counsel acceptable to City), and hold harmless the Indemnified Parties from and against any and all claims, actions, proceedings, and Liabilities arising out of, or in any way related to, the construction, maintenance, land use, or operations conducted pursuant to this CCP, regardless of how a court apportions any such Liabilities as between the Permittee, the City, and/or third parties. The City shall promptly notify the Permittee of any such claim, action, or proceeding and shall cooperate fully in the defense.
d. Neither the issuance of this CCP, nor compliance with the conditions hereof, shall relieve the Permittee from any responsibility otherwise imposed by law for damage to persons or property; nor shall the issuance of this CCP serve to impose any liability upon the Indemnified Parties for injury or damage to persons or property.

Condition of Approval No. 3 Relationship of CCP Conditions, Laws, and Other Entitlements
The Permittee shall implement the Project in compliance with all applicable requirements and enactments of federal, state, and local authorities. In the event of conflict between various requirements, the more restrictive requirements shall apply. In the event the City Manager determines that any CCP condition contained herein is in conflict with any other CPP condition contained herein, when principles of law do not

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provide to the contrary, the CCP condition most protective of public health and safety and environmental resources shall prevail to the extent feasible.

No condition of this CCP for uses allowed by the City Municipal Code shall be interpreted as permitting or requiring any violation of law, lawful rules, or regulations, or orders of an authorized governmental agency. Neither the approval of this CPP, nor compliance with the conditions of this CPP, shall relieve the Permittee from any responsibility otherwise imposed by law for damage to persons or property.

The Permittee shall obtain a business tax certificate and regulatory licenses for the operation of Commercial Cannabis operations.

Condition of Approval No. 4 - Contact Person
PURPOSE: To establish a contact person responsible for responding to City and/or community complaints.

The Permittee shall designate a contact person(s) to respond to complaints from citizens and the City which are related to the permitted uses of this CUP.

The Permittee shall provide the City with the contact information (e.g., name and/or position title, address, business and cell phone numbers, and email addresses) of the Permittee’s Community Agent who receives all orders, notices, and communications regarding matters of condition and code compliance at the Project site.

Timing: Prior to the issuance of a Zoning Clearance for use inauguration, the Permittee shall provide the Planning Division the contact information of the Permittee’s field agent(s) for the Project file. If the address or phone number of the Permittee’s field agent(s) should change, or the responsibility is assigned to another person, the Permittee shall provide Planning Division staff with the new information in writing within three calendar days of the change in the Permittee’s field agent.

The Planning Division maintains the contact information provided by the Permittee in the Project file. The Planning Division has the authority to periodically confirm the contact information consistent with the requirements of this permit.

Condition of Approval No. 5 - Resolution of Complaints
PURPOSE: To establish a process to resolve complaints.

The following process shall be used to resolve complaints related to the Project:
a. The Permittee shall post the telephone number for the designated Contact Person as identified pursuant to Condition No. 4 in a visible location on the site.

The Contact Person shall be available via telephone on a 24-hour basis.

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Persons with concerns about an activity as it is occurring may directly contact the Contact Person;
b. If City staff receives a written complaint about the Project, the City Manager, or his designee, may contact the Permittee’s Contact Person or the Permittee to request information regarding the alleged violation; and c. If, following a complaint investigation by City staff, a violation of the City Municipal Code or a condition of this CCP is confirmed, City staff may initiate enforcement actions, in accordance with City Municipal Code.

Condition of Approval No. 6 - Reporting of Major Incidents PURPOSE: To ensure that the Planning Director is notified of major incidents associated with, or resulting from, the Project, he Permittee shall immediately notify the Planning Director by telephone, email, FAX, and/or voicemail of any incidents (e.g., fires, explosions, spills, landslides, or slope failures) that could pose a hazard to life or property inside or outside the Project Site.

Upon request of any City, County or State regulatory agency, the Permittee shall provide a written report of any incident that shall include, but not limited to: a description of the facts of the incident; the corrective measures used, if any; and the steps taken to prevent a recurrence of the incident.

Timing: The Permittee shall provide the written report to the requesting agency and Planning Division within seven days of receiving the request.

The Planning Division maintains any documentation provided by the Permittee related to major incidents in the Project file.

Condition of Approval No. 7 - Change of Permittee
To ensure that the Planning Division is properly and promptly notified of any change of Permittee, the Permittee shall file, as an initial notice with the Planning Director, the new name(s), address(es), telephone/FAX number(s), and email addresses of the new owner(s), lessee(s), operator(s) of the permitted uses, and the company officer(s). The Permittee shall provide the Planning Director with a final notice once the transfer of ownership and/or operational control has occurred.

The initial notice must be submitted with the new Permittee’s contact information. The final notice of transfer must include the effective date and time of the transfer and a letter signed by the new Property Owner(s), lessee(s), and/or operator(s) of the permitted uses acknowledging and agreeing to comply with all conditions of this CCP.

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Timing: The Permittee shall provide written notice to the Planning Director 10 calendar days prior to the change of ownership or change of Permittee. The Permittee shall provide the final notice to the Planning Director within 15 calendar days of the effective date of the transfer.

The Planning Division maintains notices submitted by the Permittee in the Project file and has the authority to periodically confirm the information consistent with the requirements of this permit.

COMMERCIAL CANNABIS PRODUCTS MANUFACTURING (ORD. 673, SEC

5.20.110)
PURPOSE: The purpose and intent of this Section is to permit and regulate the commercial Cannabis Products Manufacturing to promote the health, safety, morals, and general welfare of the resident and businesses within the City. The City is authorized to regulate this activity pursuant to State Law.

Condition of Approval No. 8 - Manufacturing Operating Fees.

Operator/Permittee must pay all operating fees as stipulated within Development Agreement No. DA18-011C.

Condition of Approval No. 9 – Manufacturing Properties.

Commercial 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.

Condition of Approval No. 10 – Quality Control Employee.

The Permittee must employ at least one (1) member of its personnel dedicated full time to quality control.

Condition of Approval No. 11 – Standard Operating Procedures and Batch Record.

The Manufacturing Permittee must establish standard operating procedures and batch record that comply with current good manufacturing practices and applicable State Law, including MAUCRSA.

Condition of Approval No. 12 – Labeling and Packaging.
a) All Cannabis Products produced by a Manufacturing Permittee must be packaged in child resistant containers prior to leaving the Premises for such Manufacturing Permittee in accordance with applicable State Law, including MAUCRSA.
b) All Cannabis Products produced by a Manufacturing Permittee must be labeled in compliance with applicable State Law, including MAUCRSA. c) Labeling Requirements – Edibles

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i. 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.
ii. All items to be sold or distributed shall be individually wrapped at the original point of preparation by the Cannabis Permittee. iii. 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.
iv. 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.
v. The package must have a label warning that the product is to be kept away from children.
vi. 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. vii. Distribution must be in a properly labeled opaque package when distributed.
viii.The City Manager, or designee, may impose additional packaging and labeling requirements on Cannabis or Cannabis Products.

Condition of Approval No. 13 – Use of Solvents.
a) 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. b) 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).

Condition of Approval No. 14 – Use of Hazardous and Flammable Materials.

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 commercial 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

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(Hazardous Materials) are located on the Premises or where required by the applicable building or fire official.

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.

Condition of Approval No. 15 – Compressed Gases.

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. 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.

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

Condition of Approval No. 16 – Final Floor Plan Approval Permittee must submit to and obtain approval from the City Manager, or his designee, on all proposed Final Floor Plans. All Final Floor Plans shall be stamped and dated by the Planning Department. 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. 17 – Payment of Development Agreement Fees

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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. 18 – 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.
i. Landscape Plan – The Operator must submit a landscaping plan, designed by a licensed landscape architect or arborist. The plan must include a five-foot 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.
ii. 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.
iii. 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.
iv. LA County Public Health Permit – The Operator must submit obtain a Cannabis Public Health Permit from the Los Angeles County Public Health.
v. 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.

Condition of Approval No. 19 – 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.

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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.

Condition of Approval No. 20 – 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. 21 - 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. 22 - 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

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approved Development Agreement, the terms of the Development Agreement shall control and take precedence.

Condition of Approval No. 23. - 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 in order 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 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, as specified on the project approval letter, the Permittee must complete construction of Phase I (if applicable), 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, 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, 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.

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B Permit Life or Operations Period: This CCP will expire on September 17, 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 day prior to September 17, 2028; and
(2) The City decision-maker grants the requested modification.

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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EXHIBIT G
RESOLUTION NO. 18-20

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1 RESOLUTION NO. 18-22

A RESOLUTION OF THE PLANNING COMMISSION OF THE CITY

OF CUDAHY, CALIFORNIA, RECOMMENDING ADOPTION OF AN

ORDINANCE APPROVING A DEVELOPMENT AGREEMENT BY

AND BETWEEN THE CITY OF CUDAHY AND AQUA TERGERE,

LLC, A CALIFORNIA LIMITED LIABILITY COMPANY AND THE

ISSUANCE OF A COMMERCIAL CANNABIS PERMIT
WHEREAS, the City of Cudahy (“City”) is a general law city, incorporated under the laws of the State of California, and has the power to make and enforce within its jurisdictional limits all local, police, sanitary and other ordinances and regulations not in conflict with the general laws of the state; 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) 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;
WHEREAS, the City of Cudahy Planning Commission ("Planning Commission") conducted a properly noticed public hearing to consider this Resolution concerning the Development Agreement (as defined below), at which time testimony and evidence, both written and oral, were presented to and considered by the Planning Commission; 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 Planning Commission finds and determines that an Ordinance adopting the Development Agreement furthers the public health, safety, and general welfare of the community,

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2 and is in the public interest;
WHEREAS, the Planning Commission further finds and determines that the City Council should approve a Commercial Cannabis Permit to allow a Commercial Cannabis Facility for the Site set forth in the Development Agreement;
WHEREAS, the Planning Commission further finds and declares that an Ordinance adopting the Development Agreement is necessary and appropriate to ensure that cannabis businesses are operated in a manner compatible with and not detrimental to other land uses in the vicinity, and further that the Ordinance is consistent with the purposes and goals of the City’s General Plan, as amended, and applicable zoning including but not limited to making allowances for a variety of land uses that serve the needs and desires of the community; WHEREAS, the City Council shall approve a development agreement by ordinance;

NOW THEREFORE, THE PLANNING COMMISSION OF THE CITY OF
CUDAHY DOES HEREBY RESOLVE, DECLARE AND DETERMINE AS FOLLOWS:

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

SECTION 2. RECOMMENDATION OF APPROVAL OF DEVELOPMENT

AGREEMENT BY ORDINANCE
That the Planning Commission recommends that the City Council adopt an Ordinance approving a Development Agreement By and Between the City of Cudahy and AQUA TERGERE, LLC a California limited liability company [DA#18-011C] ("Development Agreement"), 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. RECOMMENDATION OF APPROVAL OF A COMMERCIAL

CANNABIS PERMIT BY THE CITY COUNCIL
That the Planning Commission further recommends that the City Council should approve Commercial Cannabis Permit No. CCP 18-0011, subject to the terms and conditions stated therein, to allow a Commercial Cannabis Facility for the Site set forth in the Development Agreement located at 8210 Atlantic Avenue, City of Cudahy, CA. A copy of the permit is attached hereto incorporated herein by this reference as Exhibit "B."

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3 PASSED AND ADOPTED by the Planning Commission of the City of Cudahy at a duly noticed meeting held on the 17th day of September 2018 by the following vote:

AYES:

NOES:

ABSTAIN:

ABSENT:
_________________________________
Planning Commission Chair
ATTEST:
___________________________________
Planning Commission Secretary

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4 EXHIBIT "A"

DEVELOPMENT AGREEMENT

BY AND BETWEEN

THE CITY OF CUDAHY
AND

AQUA TERGERE, LLC, A CALIFORNIA LIMITED LIABILITY

SEE ATTACHMENT

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5 EXHIBIT "B"

COMMERCIAL CANNABIS PERMIT

SEE ATTACHMENT
[The Permit will be based upon the Staff Report with
Conditions of Approval and will be Issued in a Letter to Follow]

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EXHIBIT H
ORDINANCE NO. 6 97

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1 ORDINANCE NO. 697

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
CUDAHY, CALIFORNIA, APPROVING: (1) A DEVELOPMENT

AGREEMENT BY AND BETWEEN THE CITY OF CUDAHY AND

AQUA TERGERE, 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) 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 the recommendation of the Planning Commission, 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 oral, were presented to and considered by the City Council.

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2 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 Aqua Tergere, LLC a California limited liability company ("Development Agreement") [DA#18-011C], 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. CCP 18-0011, subject to the terms and conditions stated therein, to allow a Commercial Cannabis Facility for the Site located at 8210 Atlantic Avenue, 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 Agreement with the County Recorder for the County of Los Angeles no later than ten (10) days after its execution.

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3 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 AND ADOPTED by the City Council of the City of Cudahy at a regular meeting held on the 16th day of October 2018 by the following vote:

AYES:

NOES:

ABSTAIN:

ABSENT:

ATTEST: APPROVED:

Rick Iglesias, City Clerk Chris Garcia, Mayor
APPROVED AS TO FORM:

Glenn Ward Calsada, Special Counsel

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4 EXHIBIT "A"

DEVELOPMENT AGREEMENT

BY AND BETWEEN

THE CITY OF CUDAHY

AND AQUA TERGERE, LLC

A CALIFORNIA LIMITED LIABILITY COMPANY

SEE ATTACHMENT

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5 EXHIBIT "B"

COMMERCIAL CANNABIS PERMIT

SEE ATTACHMENT
[The Permit will be based upon the Staff Report with
Conditions of Approval in a Letter to Follow]

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RECORDING REQUESTED BY |
City of Cudahy |
AND WHEN RECORDED MAIL TO: |
City of Cudahy |
5220 Santa Ana Street |
Cudahy, CA 90201 |
Attention: City Manager |
|
==================================================================

SPACE ABOVE THIS LINE FOR RECORDER'S USE
Recording Fee Exempt per Government Code §6103

COMMERCIAL CANNABIS

DEVELOPMENT AGREEMENT

BETWEEN THE CITY OF CUDAHY AND

AQUA TERGERE, LLC
THIS DEVELOPMENT AGREEMENT (this “Agreement”) is made and entered into this __________ day of ________________, 2018, (the “Execution Date”), by and between the CITY OF CUDAHY, a California municipal corporation (“City”) and AQUA TERGERE, LLC a California limited liability company ("Owner"). City and Owner are sometimes referenced together herein as the “Parties.” In instances when a provision hereof applies to each of the Parties individually, either may be referenced as a “Party.” The Parties hereby jointly render the following statement as to the background facts and circumstances underlying this Agreement.

RECITALS
A. The State of California enacted California Government Code Sections 65864 et seq. (“Development Agreement Statutes”) to authorize municipalities to enter into development agreements with those having an interest in real property to strengthen the public planning process, encourage private participation in comprehensive planning, and reduce the economic risk of development in connection with the development of real property within their jurisdiction.

B. The purpose of the Development Agreement Statutes is to authorize municipalities, in their discretion, to establish certain development rights in real property for a period of years regardless of intervening changes in land use regulations, to vest certain rights in the Owner, and to meet certain public purposes of the local government.

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C. As authorized by the Development Agreement Statutes, the City has adopted Municipal Code Chapter 20.28 (Development Agreements) establishing the procedures and requirements for the consideration of development agreements with the City.

D. Owner currently holds a legal or equitable interest in real property considered in this Agreement which has a development area approximately 2665 square feet located at 8210 Atlantic Ave., City of Cudahy, State of California (the “Site”). The Site includes Assessor’s Parcel Number: 6224-023-020, and is more fully described in Exhibit A and shown on the map in Exhibit B. Both exhibits being attached hereto and incorporated herein by this reference.

E. Presently, Owner has a leased interest a portion of the Site for the purpose of medicinal cannabis related activities which shall include, but not be limited to, facilities where cannabis is planted, grown, harvested, dried, cured, graded, trimmed, extracted, manufactured into cannabis products, distributed, or transported and sold not as a store-front retail dispensary, or that does all or any combination of those activities (“Medicinal Cannabis”). Such Medicinal Cannabis facilities shall operate in accordance with all applicable provisions of Business and Professions Code §§26000-26231.2; California Health and Safety Code Safety Code §§ 11357-11362.9 and 11362.7- 11362.85; Revenue and Taxation Code §§ 34010-34021.5; Vehicle Code §§ 2429.7 and 23222; Water Code §§ 1831, 1847, and 13276; and the City of Cudahy Municipal Code as it applies to such facilities (collectively the “California Cannabis Laws”). Prior to operating a medicinal cannabis cultivation facility, Owner shall be required to obtain a Medicinal Commercial Cannabis Permit from the City pursuant to City Ordinance No. 673.

F. Ultimately, Owner intends upon obtaining a state license issued, pursuant to California Cannabis Laws, to operate a medicinal commercial cannabis or adult use facility at the Site. The definition of "Owner" hereunder shall mean and refer to the fee simple owner and/or any authorized tenant of the Site to the extent such party holds or is covered by a Regulatory Permit. In the event the City of Cudahy permits adult use cannabis commercial activity, Owner shall receive priority processing for any corresponding City permits for the same to the extent authorized by law.

G. On December 4, 2017 Owner applied to this City for a Medicinal Cannabis Manufacturing Permit (hereinafter "Regulatory Permit”) to conduct Medicinal Commercial Cannabis Activities. No such activities are permitted without a Development Agreement within or outside the boundaries set forth in the Overlay Zone/Permit Area illustrated in Exhibit “A” to City Ordinance No. 673.

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H. Owner presently intends to develop and open a medicinal marijuana facility on the Site consistent with the California Cannabis Laws and Project Approvals (known as the “Project”). The Project will include taking fresh and dried plant material and selectively extract the plant oils and components to produce a concentrate of products of medicinal cannabis of the same, only to other legally permitted persons and entities under the California Cannabis Laws (“licensed persons”), who operate retail dispensary outlets or other licensed facilities under the California Cannabis Laws, but would not include the dispensing or sale of Cannabis Products at the Project Site without further authorization by the City.

I. The proposed Project includes a Commercial Cannabis Permit, which is a type of conditional use permit, to allow for a Commercial Cannabis Facility and a Development Agreement (DA) for commercial cannabis activities including manufacturing within an existing, currently vacant, approximately 2,665 square foot industrial building. The site is currently developed with one commercial building. The proposed project will be built in one phase. More specifically, the proposed project would include:
• Manufacturing: The manufacturing area consists of a 240 square foot prefabricated class1/division1 FlexMod extraction room that will house state of the art closed-loop extraction systems, a 356 square foot pre post process room where minor post extraction manipulations will occur (ie. decarboxylation, degassing, and drying), a 488 square foot post-process room that meets class1/division2 safety standards that will house processing and evaporation equipment, a 266 square foot storage and transfer room that will hold both intake and outtake manifests as well as storage of fresh plant material, an 80 square foot product storage vault where bulk and packaged product will be stored, and a 360 square foot packaging and labeling room containing boxes, glass jars, and child-proof packaging of extraction products. The facility also includes 106 square feet of restrooms where employee’s can change into proper work attire and utilize the facilities. The site includes a total of 1,084 (240 C1D1, 356 pre process, 488 post process) square feet of production space and 2,665 square feet of total premises space.

Hours of Operation: The facility will be open from 8 a.m. to 8 p.m., Monday through Friday, for general business hours with approximately eight (8) employees per shift.

Owner will employ approximately 10 employees.

Parking/Loading/Access: The proposed project provides 15 parking spaces, including 1 accessible van spaces. Loading will take place on-site. Vehicular access to the site will be through an existing driveway on Atlantic Avenue. Within the site, access to the structures will be through the secured front office entrance. The project complies with the CAL Green Tier 1 by incorporating stormwater pollution prevention measures, installing energy- and water-efficient equipment, and planting native and droughttolerant landscaping at the front of the property.

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Security: The project will secure the facility against unauthorized entry by installing security lights on the exterior of the building to illuminate the side yards and parking area, installing commercial-grade locks, installing an alarm and video surveillance system, establishing procedures for identifying authorized persons, establish inventory controls, and install a secure surveillance vault to maintain the integrity of records. In addition, the applicant will engage a licensed security company to provide an operational security plan in compliance with Ordinance 673. [ ] Co-location, check if applicable:

Note MAUCRSA now authorizes a person to apply for and be issued more than one State license at one location provided the licensed premises are separate and distinct. See also, Cudahy Municipal Code Section 5.20.050(b)(2).

Owner has applied for one [1] license(s): Manufacturing J. On September 11, 2017, the City adopted Ordinance No. 673 permitting Certain Medicinal Commercial Cannabis Activities in strict compliance with the California Cannabis Laws under specified conditions and provisions. A referendum petition was circulated for signatures; however, on November 1, 2017, the County Clerk for the County of Los Angeles determined that the referendum lacked sufficient signatures to delay the effective date of Ordinance No. 673. The City has recently been presented with a citizen initiative to repeal Ordinance 673 and ban all marijuana uses in all zones.

Applicant is advised to consult with legal counsel on this matter.

K. 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.

L. The City has given public notice of its intention to adopt this Agreement and has conducted public hearings thereon pursuant to California Government Code §65867.

The City has found that the provisions of this Agreement and its purposes are consistent with the objectives, policies, general land uses and programs specified in City’s General Plan, zoning code and municipal ordinances.

M. The City, in entering into this Agreement, acknowledges that certain City obligations hereby assumed shall survive beyond the terms of the present Council members, that this Agreement will serve to bind City and future Councils to the obligations hereby undertaken, and that this Agreement shall limit the future exercise of certain governmental and proprietary powers of City. By approving this Agreement, the

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Council has elected to exercise certain governmental powers at the time of entering into this Agreement rather than defer its actions to some undetermined future date. The terms and conditions of this Agreement have undergone extensive review by City and the Council and have been found to be fair, just and reasonable. City has concluded that the pursuit of the Project will serve the best interests of its citizens and that the public health, safety and welfare are best served by entering into this obligation. Owner has represented to City that it would not consider or engage in the Project absent City approving this Agreement.

N. The City agrees that Owner’s land use entitlements for the Project shall vest for the term of this Agreement as described below.

O. After conducting a duly noticed hearing on ________________, in conjunction with Section 20.28.030 of the City’s Municipal Code, the Planning Commission of the City reviewed, considered and approved environmental clearance and recommended approval of the execution of this Agreement to the City Council. The Planning Commission found the Project: consistent with the objectives, policies, general land uses and programs specified in the general plan; compatible with the uses authorized in the Overlay Zone; in conformity with the public necessity, public convenience, general welfare and good land use practices; will not be detrimental to the health, safety and general welfare of the city; will not adversely affect the orderly development of property or the preservation of property values; and will have a positive fiscal impact on the City.

P. After conducting a duly noticed hearing on ___________________, in conjunction with Section 20.28.060 of the City’s Municipal Code, and after independent review and consideration, the City Council approved the execution of this Agreement.

The City Council found the Project: consistent with the objectives, policies, general land uses and programs specified in the general plan; compatible with the uses authorized in the Overlay Zone; in conformity with good land use practices; will not be detrimental to the health, safety and general welfare of the City; and is in the best interest of the City of Cudahy and its residents.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, and other good and valuable consideration, the receipt and legal sufficiency of which are hereby acknowledged, the Parties do hereby agree as follows:

1. Government Code and Municipal Code Required Elements a. Description of Property. Land situated in the City of Cudahy, County of Los Angeles, State of California; whose street address is 8210 Atlantic Ave., City of Cudahy.

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Aqua Tergere, LLC Page 6 of 40 City of Cudahy
Development Agreement
DA # 18-019C
b. Owner and Other Person with Legal or Equitable Interest.

Owner: Aqua Tergere, LLC
Nature of Interest: Lease for 5 years with Option to Renew for an additional 5 years.

If Owner is not the fee simple owner of the Site, check box below:
[x] Owner represents and warrants that the property owner has consented in writing to the execution and recordation of this Agreement against the Site. Owner represents that the property owner is the common owner of adjacent parcels and that its has the lawful consent of the property owner to access the Site by crossing his adjacent parcels for access purposes. The property owner has expressly consented to all terms of this Agreement as a covenant running with the land.

See attached Landlord Consent agreement, incorporated herein by this reference (Exhibit C).
c. Permitted Uses. The subject property may be used for any medicinal commercial cannabis facility as presently authorized under 5.20.110 [Medicinal Cannabis Products Manufacturing] of the municipal code, and for any other use as authorized under applicable provisions of the municipal code. d. Zoning. Owner shall guarantee that such activities outlined in Owner’s Medicinal Commercial Cannabis Permit Application (“Application”) conducted pursuant to this Agreement and under the Regulatory Permit shall comply with the City’s municipal code, including the zoning ordinance and any and all development and construction requirements contained therein. Owner shall not conduct any business under this Agreement or under the Regulatory Permit without having obtained all necessary permits, licenses, and approvals from the City and State of California.
e. Reservation or Dedication of Land for Public Purposes. Sufficient roadway, sidewalk, and utility easements shall be reserved or dedicated to City for such purposes.

2. Term
This Agreement shall commence on the Effective Date and it shall end ten (10) years from the starting date, and it shall remain in full force and effect so long as the subject property is used for a commercial cannabis facility as authorized

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under 5.20.110 of the municipal code (as amended); provided, however, such use is not abandoned for a period of more than ninety (90) days.

This Agreement SHALL be extended for one (1) additional ten (10) year period following the expiration of the initial ten (10) year term upon the occurrence of all of the following:
(i) The Owner shall give written notice to the City no later than one hundred twenty (120) days before the expiration of the initial ten (10) year term that the Owner desires to extend this Agreement for an additional ten (10) year period;
(ii) The Owner shows adequate evidence to the City that it has a legal and/or equitable interest in the Property and/or will have such interests for the duration of the extended term of the Agreement; (iii) The Owner shall deposit all fees required by the City necessary for processing the extension request and drafting necessary documentation;
(iv) The Owner shall not be in default of any provision of any agreement between City and Owner relative to the development of the Property or of any condition of approval imposed upon any entitlement granted by the City relative to the development of the Property for which Owner has been given a written notice to cure by the City and for which Owner has not cured or commenced to cure such default within thirty (30) days, if and as provided by such agreement or condition of approval.

3. Owner’s Site and Floor Plans
a. Owner’s site plan and floor plan for the facility are attached hereto as Exhibit D and incorporated into the Application.
b. A preliminary landscape plan shall be prepared and reviewed and approved by the City Manager and/or Community Development Manager. A final landscape plan shall be prepared and submitted in conjunction with building and site improvement plans prior to issuance of building permits for construction activities.

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c. An exterior signage plan shall be prepared and reviewed and approved by the City Manager and/or Community Development Manager in accordance with the procedures and requirements of Section 5.20.050(d) of the municipal code.

4. Facility Operations
a. Standard Operating Procedures. Owner is a lawful entity that will only sell to other legally permitted persons and entities under the California Cannabis Laws. Prior to operating a medical marijuana cultivation, manufacturing, distribution, or delivery facility, Owner shall be required to obtain a Cannabis Permit from the City pursuant to City Ordinance No. 673. Further, and notwithstanding anything to the contrary, Owner may operate such medicinal cannabis-related activities as permitted in accordance with California state law, as may be amended, including without limitation, as long as such activity is not inconsistent with the Cudahy Municipal Code.

During the term of its regulatory Permit and the term of this Agreement, Owner shall lawfully operate in accordance with all state and local laws. Owner shall employ exemplary operating procedures to comply with state and local laws.

Owner’s facility shall employ safety and security measures for the safety and security of its employees, visitors, vendors, and neighboring communities and properties.

Owner shall fully comply with the minimum Business Standards regulating Medicinal Commercial Cannabis Activity set forth in new Section 5.20.050 of the Cudahy Municipal Code and such more specific operational requirements set forth in Exhibit E, "Business Standards", attached hereto. b. Security Plan. Owner shall secure approval of its proposed security plan by the Los Angeles County Sheriff or the City prior to operating. The security plan shall include, at a minimum and as appropriate, provisions for video surveillance, perimeter fencing and security, protection of the building(s) from vehicle intrusion, cash handling procedures, internal accounting controls, product handling and storage procedures, and a professionally monitored alarm system.

Equipment and systems used for video surveillance and building alarms shall be approved by City. See Cudahy Municipal Code Section 5.20.050(r) for minimum security requirements.

Video surveillance shall include, at a minimum, all site and facility entrances and access points, all spaces accessible by the public, all secured areas of the facility with restricted access, all interior spaces and rooms where medicinal cannabis products are handled and processed, shipping and receiving areas, cash storage

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areas, and other areas necessary to protect the safety of employees and the public and to ensure medical marijuana products are received, handled, stored, packaged, shipped, and distributed in compliance with applicable state and local laws and regulations. The video surveillance system shall be web-based with direct access provided to the Los Angeles County Sheriff upon request.

The security system shall also include sensors to detect entry and exit from all secure areas, panic buttons in appropriate locations, and a professionally monitored alarm system with glass breakage sensors and motion detectors.

Owner shall employ properly trained and licensed third-party security personnel to protect the welfare and safety of Owner and employees, and to ensure public safety to the neighboring community. Owner shall use security personnel 24 hours, 7 days a week. Security personnel may be armed so long as proper licensing and insurance requirements are followed and met by the third-party operator providing such security services.
c. Fire Department Approval. 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. d. Possession of Firearms. Except for licensed and bonded security personnel, no person employed by Owner shall be in possession of any firearm while on the premises or location without having first obtained a license from the appropriate state or local agency authorizing the person to be in possession of such firearm. Every such person in possession of a firearm while on the premises or location must provide the City Manager and the Los Angeles County Sheriff, ten days before bringing the firearm onto the premises, with the following:
1) A copy of the license issued to the person by the appropriate state or local agency authorizing him or her to possess such firearm; 2) A copy of his or her law enforcement identification (if he or she is employed by a law enforcement agency);
3) A copy of his or her California driver’s license or California identification card; and
4) Any other information reasonably required by the Los Angeles County Sheriff to show that the individual is in compliance with the provisions of all laws regarding the possession and use of a firearm.

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e. Identification Display. Each owner, manager, employee, and individual member engaged in the cultivation, processing, manufacturing, distribution, or transporting of cannabis shall at all times while engaged in the duties of his or her position wear in plain sight, on his or her person and at chest level, a valid identification badge, issued by Owner.
f. Employee Background Checks/Procedures for Inventory Control to Prevent Non-Medical Diversion of Medical Cannabis. Only employees who receive clearance from the proper oversight authority shall be permitted to enter Owner’s facility. Each employee will have to meet a criminal background investigation conducted by the Los Angeles County Sheriff, which at minimum shall include a LiveScan criminal history check, which City shall make a good faith effort to facilitate within a reasonable time following the issuance of a commercial cannabis permit(s) or license(s) to Owner.

Owner shall take all necessary and reasonable steps to prevent the distribution of any of its medicinal cannabis products to minors; prevent revenue from the sale or distribution of its medicinal cannabis and/or infused products from going to criminal enterprises, gangs and cartels; prevent the diversion of cannabis from California to any other state; prevent state-authorized cannabis activity from being used as a cover or pretext for the trafficking of other illegal drugs or other illegal activity; prevent violence and the use of firearms in the cultivation, manufacture, testing, delivery and distribution of cannabis; discourage and educate against drugged driving and the exacerbation of other adverse public health consequences associated with cannabis use; disavow growing cannabis on public lands that creates attendant public safety and environmental dangers posed by such illegal uses; and discourage and educate against cannabis possession or use on federal property.
g. Quality Control and Testing. Owner shall utilize quality control measures and testing to ensure only the highest quality of commercial cannabis and infused products will be produced. Owner shall inspect the product to insure its identity and quantity, and shall have a testing lab perform testing of random samples prior to distribution to its patient collective membership affiliates.

Inspection and testing will be conducted by a testing lab off-site. Testing standards and procedures shall be in accordance with applicable state law and regulations.

All medicinal commercial cannabis products will undergo a quality assurance review in accordance with state law prior to distribution. Inventory procedures will be utilized for tracking and taxing purposes by the state. Owner shall employ

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an efficient record-keeping system to make transparent its financing, testing, and adverse effect recording, as well as recall procedures. Owner shall employ an efficient record-keeping system that will reflect its financing, testing, and adverse effect recording and product recall procedures.
h. Packaging of Medicinal Commercial Cannabis and Infused Products. All Owner commercial cannabis products shall be packaged and labeled as required by California Cannabis Law and applicable requirements and regulations issued by the State of California pursuant thereto. In addition to those packaging and labeling requirements, and packaging and labeling requirements set forth in Owner’s Regulatory Permit application, as amended or supplemented, all medicinal commercial cannabis products shall be packaged in an opaque childproof container which shall contain a label or be accompanied by a leaflet or inset that states, at a minimum:
1) The name, address and telephone number of the licensed medicinal commercial cannabis facility to which the medicinal commercial cannabis product is distributed, sold, or transferred;
2) The amount of medicinal commercial cannabis in the container; and 3) The date the medicinal commercial cannabis was transferred to a licensed commercial cannabis facility.

Owner intends to produce infused products and shall secure any approval from the County of Los Angeles Health Department required for manufacturing and handling such products. Owner infused products shall not be produced, manufactured, stored or packaged in private homes. All medicinal commercial cannabis infused products shall be individually wrapped at the original point of preparation.
i. Point of Sale Tracking System. Owner shall maintain an inventory control and reporting system that accurately documents the location of medicinal cannabis products from inception through distribution, including descriptions, weight, and quantity. The inventory control and reporting system shall comply with the track and trace program required by California Cannabis Law and regulations issued thereunder.

Owner shall employ a electronic point of donation/sale system approved by the State of California for all point of donations/sales tracking from seed or inception to product distribution to other licensed commercial cannabis facilities. Such approved system shall track all medicinal commercial cannabis products, each

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edible, harvested flower, and/or manufactured concentrate, as well as gross sales (by weight and sale). Owner's point of sale system shall have the capacity to produce historical transactional data in accordance with City's requirements. j. Record Keeping. Owner shall maintain records for all medicinal commercial cannabis and/or infused products. Owner shall comply with all record-keeping responsibilities that are set forth in Municipal Code Sections

5.20.050(s), 5.20.110(e) & 5.20.120(n), including complete and up-to-date records regarding the amount of commercial cannabis cultivated, produced, manufactured, harvested, stored, tested, distributed, delivered or packaged at Owner’s facility.
k. Processing, Handling, Storing, and Distribution of Medicinal Commercial Cannabis and Related Products. Medicinal commercial cannabis cultivation, handling, storing, and processing shall be concealed from public view at all stages of growth and processing, and there shall be no exterior evidence of cultivation or processing occurring at the premises from a public right-of-way or from an adjacent parcel. Commercial cannabis cultivation, handling, storing, processing, or distribution shall not create offensive odors; create excessive dust, heat, noise, smoke, traffic, or other impacts that are disturbing to people of normal sensitivity residing or present on adjacent or nearby property or areas open to the public; or be hazardous due to use or storage of materials, processes, products, or wastes.

Owner shall store its commercial cannabis and/or commercial cannabis products in a locked safe room with T-card identification access for management only. The safe room shall be constructed of fire-rate walls with numerous cameras installed to view all entries and exits from the safe room, as well as all other activities performed within Owner’s facility. Owner will not conduct outdoor operations except as related to lawful delivery and transportation of medicinal commercial cannabis and infused products. Owner will not store medicinal commercial cannabis or related products in its delivery vehicle outside normal operating hours of the facility.

Medicinal commercial cannabis products shall be sold or distributed only to licensed dispensaries in California. Excess or contaminated product will be securely stored on-site until it is properly disposed. Disposal may include composting, incineration, land-fill disposal through the local waste management hauler, or other disposal methodology in accordance with state and county health and safety codes and regulations.

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l. Odor Control. All structures shall have ventilation and filtration systems installed that prevent commercial cannabis plant odors from exiting the interior of the structure. The ventilation and filtration system shall be approved by the Building Official and installed prior to commencing cultivation or manufacturing within the allowable structure. Facility air intake, exhaust, and recirculating system shall be of industrial grade. Activated charcoal, recirculating, and closed loop aeration systems will be utilized as necessary for effective odor control and management.
m. Description of Banking Plan. Owner shall seek to open a bank account under the name of Owner or its associated management company to provide transparency for funds received, operational costs, including payroll, tax payments to the state and federal governments. Should a bank account not be forthcoming, Owner shall implement other industry standard banking and/or other industry standard transactional mechanisms.
n. Transportation Plan. Owner shall comply with all state and local law regarding transportation, including the rules governing delivery service. Owner shall retain a list of names and cellular contact numbers for all employees engaged in transportation of commercial cannabis products and provide it to the applicable oversight authority, keeping the list current and up to date.

Owner will keep complete and up-to-date records documenting each transfer of commercial cannabis to other lawful cooperative corporations, including the amount provided, the form or product category in which the commercial cannabis was provided, the date and time provided, the name of the employee making the transfer, the name and address of the other lawful cooperative corporation to whom delivery is made, and the amount of any related donation or other monetary transaction.

5. Community Relations, Employment, and Wages
a. Public Outreach and Education Program. The Owner shall coordinate and cooperate with City and other Owners of medicinal commercial cannabis facilities located within City of Cudahy in the establishment and implementation of appropriate public outreach and education programs, including but not limited to outreach and interface with public and private schools, youth organizations, religious organizations, health care providers, drug abuse treatment providers and mental health and drug counseling providers. The public outreach and education programs shall be approved by City.

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b. Community Benefits Program. The Owner shall coordinate and cooperate with the City and other Owners of medicinal commercial cannabis facilities located within the City of Cudahy in the establishment, implementation, and funding of a community benefits program which could include such items as capital improvements, new community recreation facilities, expansion and/or improvement to existing facilities or other physical improvements that provide a benefit to the community, support of holiday and special community events, and support of local public service, public safety, litigation defense and special districts and social and community organizations. This community benefits program may be implemented by the City. The City will invite public participation in the decision-making process for identifying and prioritizing community needs and benefits, and identifying appropriate projects to be funded by the entity implementing this community benefits program. All projects under the community benefits program must be approved by the City.

Owner agrees, as a business expense, to pay the City the yearly sum of $66,667.00. Unless initialed below by the City Manager, this yearly sum shall be deposited in full into a dedicated account set up by the City in order to create, fund and implement a City-approved community benefits program. _________ If initialed here by the City Manager, Owner has been approved for the following payment plan: Within thirty days of the Effective Date of this Agreement, the Owner shall deposit into the City's dedicated account, in good funds, twenty percent (20%) of the yearly sum of $66,667.00 [initial payment calculated at $13,333.40] and shall pay the balance thereof over a period of ten (10) months payable in equal monthly installments of $5,333.36 per month. Each monthly payment shall be due and payable on the 1st day of each month and shall be deemed late on the 5th day of the month. The amount and schedule of payments may only be modified by the written consent of the City Manager at his sole and complete discretion.

Thereafter, on the anniversary date of the Effective Date of this Agreement, and yearly through-out the entire term of this Agreement and any extension thereof, Owner shall pay to the City, as a business expense, the yearly sum of $66,667.00, payable in the same manner as set forth above. c. Designation of Persons Responsible for Community Relations. At the time of this Agreement, Owner’s day-to-day operations manager, Charles Arden, will be responsible for community inquiries and complaints and on-site during normal business hours.

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d. Interface with Los Angeles County Sheriff / Inspections. Owner’s day-today operations manager, Carlos Seals, will interface with the Los Angeles County Sheriff Department's assigned designee to ensure its operation complies with state and local laws and regulations. The City Manager, or designee, or the Los Angeles County Sheriff's Department's assigned designee acting at the City Manager's request and per his specific and limiting instructions, shall have the right to enter all Premises from time to time unannounced during hours of operation for the purpose of making reasonable inspections to observe and enforce compliance with this Agreement and state and local laws and regulations, without the requirement of a search warrant, subpoena, or court order, and subject to appropriate cost recovery fees set forth in this Agreement, or adopted by the City. See, Cudahy Municipal Code Section 5.20.050(t).
____________________ Owner's Initials
e. Local Recruitment, Hiring, and Training Programs. Owner is committed to making a good-faith effort to recruit, hire, and train City residents for employment by Owner. A good-faith effort means Owner shall take the following or similar actions to recruit and employ City residents: 1) Contact local recruitment sources to identify qualified individuals who are City residents, 2) Advertise for qualified City residents in trade papers and newspapers of general circulation in the area, and 3) Develop a written plan to recruit and employ City residents as a part of the its workforce. At a minimum, the Owner commits to a local annual hiring goal of 30% of total operational jobs for permanent and apprentice employees. This goal shall apply horizontally, across all departments and managerial positions. The Owner shall not be penalized or deemed in default under this Agreement if it is unable to achieve such a goal. "Local" is defined as within a 1-mile radius of the boundaries of the Overlay Zone. The Owner shall contact and work with a job referral agency assigned by the City Manager to implement a local hiring policy for permanent and apprentice employees. The purpose of the hiring policy is to facilitate the training and employment of local and disadvantaged job applicants for jobs with the Overlay Zone. Applicants for jobs shall not be disqualified from hiring solely on the basis of an arrest or conviction for a Cannabis-related crime that occurred prior to November 8, 2016, and could have been prosecuted as a misdemeanor or citation under current California law. The Owner shall report on compliance with the local hiring goals as part of its annual audit report. f. Living Wages. Living Wages. Owner shall pay all employees of the Facility, at a minimum, a Living Wage. A “Living Wage” is the higher of whatever the Owner currently pays its employees for similar work elsewhere or the following: the Full Cash Wage required to be paid by an employer to any

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individual under the City of Los Angeles Minimum Wage Ordinance [LAMC Sections 187 and 188], as adjusted annually.
g. Full-time Work. Owner shall make its best efforts to fill every position with a full-time employee. However, at no time shall Owner have a labor force that is composed of less than 50% full-time employees within its labor force, and Owner shall make a good faith effort to maintain a full-time employee level of 75%.

Owner agrees to provide to its eligible employees leave benefits, health and wellness benefits and other employee benefits to the extent such benefits are required to be paid for by Owner under applicable state and federal employment laws.

6. Indemnification Agreement by each Cannabis Permittee Pursuant to Cudahy Municipal Code Section 5.20.070(g), the City Manager may require each Cannabis Permittee to execute a separate 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. The Indemnification Agreement shall include the defense of the City and reimbursement of all fees, costs and expenses incurred by the City related to any action arising from this Agreement.

7. Fees, Costs, and Future Taxes
a. Fees. Owner agrees to pay all permit fees and charges referenced in Section 5.20.070(f) of the municipal code, in the amounts adopted by the City Council by resolution, as well as any fees set forth in this Agreement. Permit application, processing, and renewal fees shall be due and payable at the time application is made.
b. Costs. As defined in Article 8, Owner agrees to reimburse City for all additional reasonable costs of City resulting from the operation of a medicinal commercial cannabis facility authorized under applicable provisions of the municipal code, council resolutions and administrative policies and regulations.

Reimbursement to City for such costs shall be due and payable as set forth in Article 8.

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c. Operating Fees.

As used herein, “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 parties stipulate and agree that the square footage for the Premises upon the Effective Date of this Agreement is and shall be during the term of this Agreement: 1581 square feet.

As used herein, “Commercial Cannabis Activities” means all permitted activities: e.g., cultivation, possession, manufacture, processing, storing, laboratory testing, packaging, labeling, transportation, delivery or distribution of Cannabis and/or Cannabis Products.

As used herein, “Gross receipts” shall mean the total amount actually received or receivable in the course of business in a calendar year or calendar month from sales or the performance of acts or services for which charge is made or credit allowed. “Gross receipts” include, without limitation, all receipts, cash, credit, property received in lieu of cash, and any other valuable consideration taken in exchange for goods, services or other valuable consideration. See, Cudahy Municipal Code Section 5.04.030(9).

As used herein, "Production Space" means the area on or within the Premises intended for Commercial Cannabis Activities excluding non-operational common areas such as restrooms, cafeterias, break rooms, hallways, corridors, vestibules, parking structures or surface street lots. The parties stipulate and agree that the square footage for the Production Space shall be 1084 square feet.

The City Manager is specifically authorized to set and adjust the square footage for the Premises Space and Production Space and to determine the corresponding operating fee as the Project is completed.

Owner agrees to pay to City, in order to enable City to promote, protect, and enhance the healthy, safety, and welfare of the community and its residents and its quality of life, the greater of the following monthly fees (1) or (2):

1) a monthly operating fee of [.42 x total square foot of the "Premises"] until Owner is operating on the Premises, and selling product under its City Regulatory Permit and State Regulatory Permit. Once Owner is

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operational and generating revenue, the monthly operating fee is [.42 x total square foot of "Production Space"];

or,
2) a monthly operating fee(s) of:
2% of Gross Receipts for operations from the Cannabis
Manufacturing Permit on the Premises.

Facilities with multiple licenses must not commingle respective sales proceeds, and blend percentage rate of Gross Receipts.

[_______________] If initialed here by the City Manager, Operating Fees shall begin to accrue ninety (90) days after the end of month of the Effective Date of this Agreement. Otherwise, Operating fees shall begin to accrue in the month of the Effective Date of this Agreement. The operating fee shall be due and payable on the 10th day of each calendar month through-out the term of this Agreement.

Failure to pay the fee within thirty (30) days after the due date shall result in a penalty for nonpayment in a sum equal to 25% of the total amount due.

Additional penalties will be assessed in the following manner: 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 on the due date.
d. Owner understands and agrees that the fees set forth above shall be paid in a manner and in accordance with a payment schedule set or modified by City.

The cultivation, manufacturing, testing, distribution, and delivery space to which the fee applies is as identified on the attached floor plan. e. If Owner makes any changes to the interior layout of the facility that increases the amount of space allocated to those uses to which the per-squarefoot fee applies, Owner shall notify City of such changes at least fourteen (14) calendar days prior to making such changes, and the per-square-foot fee shall be modified accordingly. If Owner fails to give City notice as required herein, Owner shall be responsible for paying to City a per-square-foot fee based on any increase in the amount of space allocated to those uses to which the per-squarefoot fee applies retroactive to the date the Regulatory Permit became effective.

8. Cost Recovery Fee

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City shall assess to Owner fees to recover City’s reasonable processing and monitoring costs relating to Owner’s business upon issuance of Owner’s Manufacturing, Cultivation, Testing, Delivery, and Distribution Permits or any Additional Permits (hereinafter “CRF”). CRFs are separate and apart from any operating fees set forth in Article 7
a. Processing Fees. Processing fees for the Application are based upon the direct and indirect costs that City incurs in reviewing the Application. The processing fees for the Application shall be based only on costs that are necessary for processing the Application and implementing the Ordinance, including staff time, legal fees, and consultant fees. “Necessary for” means that but for the Application, the costs would not have been incurred. The processing fee shall not include costs for other City management objectives, unless they are necessary for processing the Application.
b. Monitoring Fees. Monitoring fees for the Manufacturing, Cultivation and Distribution Permits are based upon the direct and indirect costs City incurs in confirming the use of the Property in accordance with the municipal code, the Ordinance, this Agreement, and the Application. The monitoring fees shall be based only on costs that are necessary for conducting these reviews. “Necessary for” means that but for the Manufacturing, Distribution, Testing, Delivery and Cultivation Permits, or any Additional Permits, the costs would not have been incurred. The monitoring fee shall not include costs for other City management objectives, unless they are necessary for monitoring the permitted activities. c. Billing and Payment. The City may elect to bill the Owner the Initial CRF on the first day of the month following the Effective Date of this Agreement.

Thereafter, City shall bill Owner the CRF on the first day of each Quarter with an invoice providing the time spent by City and its representatives. Owner shall pay the CRF invoice within thirty (30) days of the date the bill for the CRF is received by Owner.
d. Disputes If Owner disagrees with the dollar amount provided by City on the CRF invoice, Owner may submit a written request before the disputed fee is due for a substitution of alternative CRF invoice to the City Manager. The written request must include supporting documentation. After review of Owner’s written request, Owner and City shall work, in good faith to resolve Owner’s written request. The dispute shall be decided in favor of Owner if City does not respond to the written request within thirty (30) days of actual receipt.

9. Additional Owner Obligations
a. Reporting of Gross Receipts from Operations

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1) Quarterly Receipts. No later than [For example, January 15, 2018], and every three months thereafter (i.e., April 15, July 15, October, and January 15 of each subsequent year), Owner shall deliver to City a report (the “Quarterly Report”) showing (i) Gross Receipts from operations for the immediate prior three months received by Owner, and a cumulative total of all amounts of Gross Receipts from Operations received by Owner for the calendar year, (ii) a calculation of the quarterly payment due to City for the prior three months, and (iii) a calculation of the cumulative total of all quarterly payments for the calendar year.
2) Statement of Receipts/Annual Audit. The Owner shall keep complete, accurate and appropriate books and records of all receipts from operations in accordance with generally accepted accounting principles.

For purposes herein, “books and records” shall mean all bookkeeping or accounting documents Owner typically utilizes in managing its business operations relating to the Project. Such books and records, as well as all other relevant documents as the City Manager may reasonably require, shall, upon reasonable written notice, be open for inspection by City, its auditors or other authorized representatives. If at any time during the term such books and records prove inadequate in the reasonable judgment of City to record the Gross Receipts from Operations as herein required, Owner shall, upon the written request of the City, procure and maintain such books and records as shall be of a character and from adequate for such purpose. City shall have the right to audit and examine such books, records and documents and other relevant items in the possession of Owner, on no less than an annual basis, or at any time upon reasonable request by the City, to the extent necessary for a proper determination of Gross Receipts from Operations, and all such books, records, documents and other items shall be held available for such audit and examination.

The City’s audit shall be performed by a non-contingency fee independent auditor approved in advance by the City. Upon request by City, Owner shall make all such books, records and documents available to the City Manager, his designee, or to the City approved auditor, and provide removable copies thereof, within thirty (30) of the date of City’s request.

Owner shall pay all costs of such audits. Owner shall preserve such books, records, documents, and other items in Cudahy for a period of not less than one (1) years for the purpose of auditing or re-auditing these accounts upon reasonable notice; except that, if an audit is made within the seven-year period and Owner claims that errors or omissions have occurred, the books and records shall be retained and made available until those matters are resolved. City shall keep strictly confidential all statements of revenue furnished by Owner and all other information

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concerning Owner’s operation of the Premises obtained by City as a result of the inspection audit and examination privileges of City hereunder, except as otherwise required by law. If City receives a request for such information pursuant to the Public Records Act (California Government Code Section 6250, et seq.), City shall provide Owner notice of any such request prior to disclosing any such information and afford Owner the opportunity to obtain a protective order. Within seven (7) years after the receipt of any statement of receipts under this Agreement, City at any time shall be entitled to carry out an audit of such revenue either by City or agent to be designated by City. If it shall be determined as a result of such audit that there has been a deficiency in any payment due under this Agreement made on the basis of such statement, then such deficiency shall become immediately due and payable within thirty (30) days of such determination.
1) Copies of Tax Filings. Owner shall provide the City with courtesy copies of each and every report Owner is required to provide to the County of Los Angeles or the State of California for sales, use, or other tax purposes at the time such filings are made.
b. Future Revenue Mechanisms. During the term of this Agreement, if the City imposes (by Citizen Initiative or otherwise) an alternative revenue mechanism specifically related to cannabis operations (e.g., a cannabis tax), Owner agrees to renegotiate in good faith the terms of this Development Agreement with the City so as to comply with an alternative revenue mechanism.

As used in this section, “alternative revenue mechanism” does not include taxes, fees, or assessments levied on or collected from both medicinal cannabis and non-cannabis operations.

10. Insurance and Indemnity

a. Insurance. Owner shall require all persons doing work on the Project, including its contractors and subcontractors (collectively, “Owner” for purposes of this Article 6 only), to obtain and maintain insurance of the types and in the amounts described in this section and its subsections with carriers reasonably satisfactory to City.
b. General Liability Insurance. Owner shall maintain commercial general liability insurance or equivalent form with a limit of not less than Two Million Dollars ($2,000,000) (or as otherwise approved, in writing, by City) per claim and Two Million Dollars ($2,000,000) each occurrence. Such insurance shall also:

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1) Name City, its elected and appointed councils, boards, commissions, officers, agents, employees, and representatives as “Additional Insureds” by endorsement with respect to performance of this Agreement. The coverage shall contain no special limitations on the scope of its protection afforded to the above-listed additional insured.
2) Be primary with respect to any insurance of self-insurance programs covering City, its officials, employees, agents, and representatives. 3) Contain standard separation of insured provisions.
c. Automotive Liability Insurance. Owner shall maintain business automobile liability insurance or equivalent form with a limit of not less than Two Million Dollars ($2,000,000) for each accident for the vehicles Owner operates in connection with its cannabis business. Such insurance shall include coverage for owned, hired, and non-owned automobiles. Such insurance shall also:
1) Name City, and work in good faith with the City and the insurers to name additional insureds as deemed reasonably necessary. “Additional Insureds” by endorsement with respect to performance of this Agreement.

The coverage shall contain no special limitations on the scope of its protection afforded to the above-listed additional insureds; 2) Be primary with respect to any insurance or self-insurance programs covering City, its officials, employees, agents, and representatives; 3) Contain standard separation of insured provisions.
d. Workers’ Compensation Insurance. Owner shall take out and maintain during the term of this Agreement, workers’ compensation insurance for all of Owner’s employees employed at or on the Project, and in the event any of the work is subcontracted, Owner shall require any general contractor or subcontractor similarly to provide workers’ compensation insurance for such contractor’s or subcontractor’s employees, unless such employees are covered by the protection afforded by Owner. In case any class of employee engaged in work on the Project is not protected under any workers’ compensation law, Owner shall provide and shall cause each contractor and subcontractor to provide adequate insurance for the protection of employees not otherwise protected. Owner hereby indemnifies City for any damage resulting from failure of Owner, its agents, employees, contractors, or subcontractors to take out or maintain such insurance. Workers’ compensation insurance with statutory limits

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and employer’s liability insurance with limits of not less than One Million Dollars ($1,000,000) each accident shall be maintained.
e. Other Insurance Requirements. Owner shall do all of the following:
1) Prior to taking any actions under this Agreement, furnish City with properly executed certificates of insurance that clearly evidenced all insurance required in this Article, including evidenced that such insurance will not be canceled, allowed to expire, or be materially reduced in coverage without thirty (30) days prior written notice to City. 2) Provide to City, upon request, and within seven (7) calendar days of said request, certified copies of endorsements and policies, and properly executed certificates of insurance evidencing the insurance required herein.
3) Replace or require the replacement of certificates, policies and endorsements for any insurance required herein expiring prior the termination of this Agreement.
4) Maintain all insurance required herein from the Effective Date of this Agreement to the earlier of the expiration of the term or the mutual written termination of this Agreement.
5) Place all insurance required herein with insurers licensed to do business in California with a current Best’s Key Rating Guide reasonably acceptable to City.
f. Indemnity. Owner agrees to indemnify, defend, and hold City, and its elected and appointed council, boards, commissions, officers, agents, employees, contractors, consultants and representatives, harmless from any and all claims costs and liability for any personal injury or property damage which may arise as a result of any actions or negligent omissions by Owner or Owner’s contractors, subcontractors, agents, or employees in connection with the construction, improvement, or operation of the Project.

11. Termination
a. Termination Upon End of Term. This Agreement shall terminate upon the expiration of the term, unless it is terminated earlier pursuant to the terms of this Agreement. Upon termination of this Agreement, City shall record a notice of

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such termination and this Agreement shall be of no further force or effect except as otherwise set forth in this Agreement.
b. Effect of Termination on Owner’s Obligations. Termination of this Agreement shall eliminate any further obligation of Owner to comply with this Agreement, or some portion thereof, if such termination relates to only part of the Site or Project. Termination of this Agreement, in whole or in part, shall not, however, eliminate the rights of Owner to seek any applicable and available remedies or damages based upon acts or omissions occurring before termination.
c. Effect of Termination on City’s Obligations. Termination of this Agreement shall eliminate any further obligation of City to comply with this Agreement, or some portion thereof. Termination of this Agreement shall not, however, eliminate the rights of City to seek any applicable and available remedies or damages based upon acts or omissions occurring before termination. d. Survival After Termination. The rights and obligations of the Parties set forth in Article 15, Article 21, and Section 23(e), Section 23(f), and Section 23(h), and any right or obligation of the Parties in this Agreement which, by its express terms or nature and context is intended to survive termination of this Agreement, will survive any such termination.

12. Resources Efficiency
Owner shall endeavor to reduce its environmental impact when possible. The design of the facility shall include reasonable water and energy conservation measures in accordance with applicable State regulations.

13. Standard Conditions for Construction
During any on-site construction activities related to development of the project site and any buildings thereon, or renovation or remodeling of existing buildings, Owner shall comply with all applicable terms and conditions of City’s Standard Conditions for Construction, attached hereto and incorporated herein by reference as Exhibit F. The Project shall comply with the applicable parking standards established by the City for cannabis activities.

14. Defaults and Remedies
a. Remedies in general. It is acknowledged by the parties that City would not have entered into this Agreement if it were to be liable in damages under this

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Agreement, or with respect to this Agreement or the application thereof, except as hereinafter expressly provided. Subject to extensions of time by mutual consent in writing, failure to delay by either party to perform any term or provision of this Agreement beyond a reasonable notice and cure period shall constitute a default. In the event of alleged default or breach of any terms or conditions of this Agreement, the party alleging such default or breach shall give the other party not less than thirty (30) day notice in writing specifying the nature of the alleged default and the manner in which said default may be satisfactorily cured during any such thirty (30) day period, the party charged shall not be considered in default for purposes of termination or institution of legal proceedings.

Notwithstanding the foregoing to the contrary, if the alleged default is of such a nature that it cannot be cured within thirty (30) days, the alleged defaulting party shall not be deemed in default as long as such party commences to cure such default within such thirty (30) day period and thereafter diligently prosecutes such cure to completion.

After notice and expiration of the thirty (30) day period, the other party to this Agreement, at its option, may institute legal proceedings pursuant to this Agreement.

In general, each of the parties hereto may pursue any remedy at law or equity available for the breach of any provision of this Agreement, except that City shall not be liable in monetary damages, unless expressly provided for this Agreement, to Owner, to any mortgagee or lender, or to any successors in interest of Owner or mortgagee or lender, or to any other person, and Owner covenants on behalf of itself and all successors in interest to the Property or any portion thereof, not to sue for damages or claim any damages. 1) For any breach of this Agreement or for any cause of action which arises out of this Agreement; or
2) For the impairment or restriction of any right or interest conveyed or provided under, with, or pursuant to this Agreement, including, without limitation, any impairment or restriction which Owner characterizes as a regulatory taking or inverse condemnation; or
3) Arising out of or connected with any dispute, controversy or issue regarding the application or interpretation or effect of the provisions of this Agreement.

Nothing contained herein shall modify or abridge Owner’s rights or remedies (including its rights for damages, if any) resulting from the exercise by City of its

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power of eminent domain. Nothing contained herein shall modify or abridge Owner’s rights or remedies (including its rights for damages, if any) resulting from bad faith intentional acts, the grossly negligent or malicious acts of City and its officials, officers, agents and employees. Nothing herein shall modify or abridge any defenses or immunities available to City and its employees pursuant to the Government Liability Act and all other applicable statutes and decisional law.

Except as set forth in the preceding paragraph relating to eminent domain, Owner’s remedies shall be limited to those set forth in this Section 14(a), Section 14(b), and Section 14(c).

Notwithstanding anything to the contrary contained herein, City covenants as provided in Civil Code Section 3300 not to sue for or claim any consequential damages or, in the event all or a portion of the Property is not developed, for lost profits or revenues which would have accrued to City as a result of the development of the Property.
b. Specific Performance. The parties acknowledge that money damages and remedies at law are inadequate, and specific performance and other nonmonetary relief are particularly appropriate remedies for the enforcement of this Agreement and should be available to all parties for the following reasons:
1) Except as provided in Sections 14(a) and 14(e), money damages are unavailable against City as provided in Section 14(a) above. 2) Due to the size, nature and scope of the Project, it may not be practical or possible to restore the Property to its natural condition once implementation of this Agreement has begun. After such implementation, Owner may be foreclosed from other choices it may have had to use the Property or portions thereof. Owner has invested significant time and resources and performed extensive planning and processing of the Project in agreeing to the terms of this Agreement and will be investing even more significant time and resources in implementing the Project in reliance upon the terms of this Agreement, and it is not possible to determine the sum of money which would adequately compensate Owner for such efforts; the parties acknowledge and agree that any injunctive relief may be ordered on an expedited, priority basis.
c. Release. Except for those remedies set forth in Sections 14(a), 14(b), and 14(c), Owner, for itself, its successors and assignees, hereby releases City, its officers, agents and employees from any and all claims, demands, actions, or suits of any kind or nature arising out of any liability, known or unknown, present

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or future, based or asserted, pursuant to Article 1, Section 19 of the California Constitution, the Fifth Amendment of the United States Constitution, or any other law or ordinance which seeks to impose any other liability or damage, whatsoever, upon City because it entered into this Agreement or because of the terms of this Agreement.

Owner acknowledges that it may have suffered, or may suffer, damages and other injuries that are unknown to it, or unknowable to it, at the time of its execution of this Agreement. Such fact notwithstanding, Owner agrees that the release provided in this Section 14(c) shall apply to such unknown or unknowable claims and damages. Without limiting the generality of the foregoing, Owner acknowledges the provisions of California Civil Code Section 1542, which provide:
“A general release does not extend to claims which the
creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.”
Owner hereby waives, to the maximum legal extent, the provisions of California Civil Code Section 1542 and all other statutes and judicial decisions of similar effect.

Owners’ Initials
d. Termination of Agreement for Default of City. Owner may terminate this Agreement in the event of a default by City in the performance of a material term of this Agreement and only after providing written notice to City of default setting forth the nature of the default and the actions, if any, required by City to cure such default and, where the default can be cured, City has failed to take such actions and cure such default within sixty (60) days after the effective date of such notice or, in the event that such default cannot be cured within such sixty (60) day period but can be cured within a longer time, has failed to commence the actions necessary to cure such default within such sixty (60) day period and to diligently proceed to complete such actions and cure such default.

Notwithstanding anything to the contrary, in the event that Owner deem it is necessary and/or advisable to cease operations in Cudahy, then Owner may terminate this Agreement, and such termination shall be effective upon the date of written notice to the City.

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e. Attorneys’ Fees and Costs. In any action or proceeding between City and Owner brought to interpret or enforce this Agreement, or which in any way arises out of the existence of this Agreement or is based upon any term or provision contained herein, the “prevailing party” in such action or proceeding shall be entitled to recover from the non-prevailing party, in addition to all other relief to which the prevailing party may be entitled pursuant to this Agreement, the prevailing party’s reasonable attorneys’ fees and litigation costs, in an amount to be determined by the court. The prevailing party shall be determined by the court in accordance with California Code of Civil Procedure Section 1032. Fees and costs recoverable pursuant to this Section 14(e) include those incurred during any appeal from an underlying judgment and in the enforcement of any judgment rendered in any such action or proceeding.
f. Owner Default. No building permit shall be issued or building permit application accepted for any structure on the Property after Owner is determined by City to be in default of the terms and conditions of this Agreement until such default thereafter is cured by Owner or is waived by City. If City terminates this Agreement because of Owner’s default, then City shall retain any and all benefits, including money or land received by City hereunder.

15. Third Party Litigation
a. General Plan Litigation. City has determined that this Agreement is consistent with its General Plan. Owner has reviewed the General Plan and concurs with City’s determination.

City shall have no liability under this Agreement or otherwise for any failure of City to perform under this Agreement, or for the inability of Owner to develop the Property as contemplated by the Agreement, which failure to perform or inability to develop is as the result of a judicial determination that the General Plan, or portions thereof, are invalid or inadequate or not in compliance with law, or that this Agreement or any of City’s actions in adopting it were invalid, inadequate, or not in compliance with the law.
b. Hold Harmless Agreement. Owner hereby agrees to, and shall hold City, its elective and appointive boards, commissions, officers, agents, attorney's, contractors, consultants and employees harmless from any liability for damage or claims for damage for personal injury, including death, as well as from claims for property damage which may arise from Owner or Owner’s contractors, subcontractors, agents, or employees’ operations under this Agreement, whether

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such operations be by Owner, or by any of Owner’s contractors, subcontractors, agents, or employees operations under this Agreement, whether such operations be by Owner, or by any of Owner’s contractors, subcontractors, or by any one or more persons directly or indirectly employed by, or acting as agent for Owner or any of Owner’s contractors or subcontractors. Owner agrees to and shall defend City and its elective and appointive boards, commissions, officers, agents and employees from any suits or actions at law or in equity for damage caused, or alleged to have been caused, by reason of any of the aforesaid operations. c. Indemnification. Owner shall defend, indemnify, and hold harmless City and its elective and appointive boards, commissions, officers, agents, attorney's, contractors, consultants and employees against and from any and all liabilities, demands, claims, actions or proceedings and costs and expenses incidental thereto (including costs of defense, settlement and reasonable attorneys’ fees), which any or all of them may suffer, incur, be responsible for or pay out as a result of or in connection with any challenge to the legality, validity or adequacy of any of the following: (i) this Agreement and the concurrent and subsequent permits, licenses and entitlements approved for the Project or Property; (ii) the environmental impact report, mitigated negative declaration or negative declaration, as the case may be, prepared in connection with the development of the Property; (iii) any claims based on or alleging inverse condemnation by any person or entity with an interest in the Property; and (iv) the proceedings undertaken in connection with the adoption or approval of any of the above. In the event of any legal or equitable action or other proceeding instituted by any third party (including a governmental entity or official) challenging the validity of any provision of this Agreement or any portion thereof as set forth herein, the parties shall mutually cooperate with each other in defense of said action or proceeding. Notwithstanding the above, City, at is sole option, may tender the complete defense of any third-party challenge as described herein. In the event City elects to contract with special counsel to provide for such a defense, City shall meet and confer with Owner regarding the selection of counsel, and Owner shall pay all costs related to retention of such counsel. d. Environmental Contamination. Owner shall indemnify and hold City, its elective and appointive boards, commissions, officers, agents, attorney's, contractors, consultants and employees free and harmless from any liability, based or asserted, upon any act or omission of Owner, its officers, agents, employees, subcontractors, predecessors in interest, successors, assigns and independent contractors, excepting and acts or omissions of City as successor to any portions of the Property dedicated or transferred to City by Owner, for any violation of any federal, state or local law, ordinance or regulation relating to industrial hygiene or to environmental conditions on, under or about the Property,

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including, but not limited to, soil and groundwater conditions, and Owner shall defend, at its expense, including attorneys’ fees, City, its officers, agents and employees in any action based or asserted upon any such alleged act or omission. City may in its discretion participate in the defense of any such claim, action or proceeding.

The provisions of this Section 15(d) do not apply to environmental conditions that predate Owner’s ownership or control of the Property or applicable portion; provided, however, that the foregoing limitation shall not operate to bar, limit or modify any of Owner’s statutory or equitable obligations as an owner or seller of the Property.
e. City to Approve Counsel. With respect to Sections 15(a) through 15(d), City reserves the right to approve the attorney(s) which Owner selects, hires or otherwise engages to defend City hereunder, which approval shall not be unreasonably withheld.
f. Accept Reasonable Good Faith Settlement. With respect to Article 15, City shall not reject any reasonable good faith settlement. If City does reject a reasonable, good faith settlement that is acceptable to Owner, Owner may enter into a settlement of the action, as it relates to Owner, and City shall thereafter defend such action (including appeals) at its own cost and be solely responsible for any judgment rendered in connection with such action. This Section 15(f) applies exclusively to settlements pertaining to monetary damages or damages which are remedial by the payment of monetary compensation. Owner and City expressly agree that this Section 15(f) does not apply to any settlement that requires an exercise of City’s police powers, limits City’s exercise of its police powers, or affects the conduct of City’s municipal operations. g. Survival. The provisions of Sections 15(a) through 15(f) inclusive, shall survive the termination or expiration of the Agreement.

16. California Environmental Quality Act
Owner shall reimburse City for any and all costs incurred by City related to project review under the California Environmental Quality Act (CEQA), Public Resources Code, §§21000-21189.3, and the Guidelines for California Environmental Quality Act, California Code of Regulations, Title 14, §§15000-15387. If reasonably requested by City, Owner shall conduct and pay for any required CEQA reviews and analyses. The City has found that the proposed Project is Categorically Exempt from California Environmental Quality Act (CEQA) requirements under provisions of CEQA Guidelines

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Section 15301 – Existing Facilities. This exemption applies to projects characterized as alterations to existing facilities meeting the conditions described in Section 15301.

17. Rules, Regulations, and Official Policies
Except as otherwise provided in this Agreement, the rules, regulations, and official policies of City governing permitted uses of the land, governing density, and governing the design, improvements, and construction standards and specifications applicable to the development of the Project subject of this Agreement, shall be those rules, regulations, and official policies of City in force at the time of the execution of this Agreement. This Agreement does not prevent City, in subsequent actions applicable to the property, from applying new rules, regulations, and policies which do not conflict with those rules, regulations, and policies applicable to the property as set forth herein, nor does this Agreement prevent City from denying or conditionally approving any subsequent development project application based on such existing or new rules, regulations, or policies.

18. Regulatory Permit Conditions of Approval
Owner shall comply with all conditions of approval of the Regulatory Permit approved by City Council.

19. Periodic Reviews
This Agreement shall be subject to annual review. Owner and Landlord executing this Agreement, or successor in interest thereto, shall demonstrate good faith compliance with the terms of this Agreement. If, as a result of such periodic review, City finds and determines, based on substantial evidence, that Owner or Landlord executing this Agreement, or successor in interest thereto, has not complied in good faith with the terms or conditions of this Agreement, City may terminate or modify this Agreement (except no modification shall increase Owner’s liability nor reduce Owner’s rights), provided that City shall first provide Owner notice of its intent to terminate, with a detailed explanation as to why, and provide Owner the reasonable right to cure the same.
a. Periodic Review. City Council shall review this Agreement annually, on or before each anniversary of the Effective Date, in order to ascertain Owner’s good faith compliance with this Agreement. During the periodic review Owner shall be required to demonstrate good faith compliance with the terms of the Agreement, through submitting an annual monitoring report, records, or equivalent written materials to the Planning Department. The Planning Department will schedule a hearing on the periodic review of the Development Agreement on or following the

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anniversary of the Effective Date, but Owner has no obligation to compel such hearing, and no implication will be made to Owner’s detriment if a hearing is not in fact held. Owner shall document any request for an extension of the term due to delays beyond the control of Owner (see Section 23(j), “Force Majeure”).

Owner shall submit an annual review and administration fee deposit not to exceed City’s estimated internal and third-party costs associated with the review and administration of this Agreement during the succeeding year, consistent with Section 23(k) (“Deposit with City”) below. City shall provide Owner said estimate a reasonable time in advance of the annual review and administration fee deposit being due.
b. Conditional Use Permit. For all intents and purposes, the Regulatory Permit to be issued under this Agreement shall be treated as if it were a Conditional Use Permit issued to Owner for the establishment and operation of its business. The operation of the business at all times shall be required to comply with the terms of this Agreement.
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.
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. e. Certificate of Agreement Compliance. If, after a periodic or special review, Owner is found to be in compliance with this Agreement, and if Owner requests it, City shall issue a Certificate of Agreement Compliance (“Certificate”) to Owner stating that after the most recent periodic or special review, and based upon the information known or made known to the Planning Director and City Council, that (i) this Agreement remains in effect and (ii) Owner is not in default.

City shall not be bound by a Certificate if a default existed at the time of the periodic or special review, but was concealed from or otherwise not known to the

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Planning Director and City Council, regardless of whether the Certificate is relied upon by assignees or other transferees or Owner.
f. Failure to Conduct Review. City’s failure to conduct a periodic review of this Agreement shall not constitute a breach of this Agreement. g. Cost of Review. The costs incurred by City in connection with the periodic reviews shall be borne by Owner.

20. Assignment
Assignment by Owner. Owner shall not transfer, delegate, sublet or assign its interest, rights, duties, and obligations under this Agreement without the prior written consent of City, which consent shall not be unreasonably withheld. Owner shall submit a transfer application to the City Manager or City Manager's designee and pay any applicable transfer fee. The proposed transferee must show proof of lawful transfer of possession of the applicable location as may be acceptable to the City. Owner is aware it mayy take the City approximately six (6) months to process a transfer application.

Any assignment, delegation, subletting or assignment without the prior written consent of City shall be null and void. Any transfer, delegation, subletting or assignment by Owner as authorized herein shall be effective only if and upon the party to whom such transfer, delegation, subletting or assignment is made is issued a Regulatory Permit as required under Section 5.20.070(i) of the municipal code.

21. Operating Commercial Cannabis Facility
Any party to this Agreement, or successor in interest thereto, shall not operate a commercial cannabis facility authorized under the municipal code unless:
a. It is the holder of a valid Regulatory Permit issued by City in accordance with the procedures and requirement of 5.20.110 [Medicinal Cannabis Products Manufacturing]; of the municipal code; and,
b. At such time as the State of California requires commercial cannabis facilities and businesses to hold a valid license or permit issued by the State of California, it also holds such license or permit, unless, however, such permit or license is not required by the State of California for the type of commercial cannabis facility or business operation that is the subject of this Agreement.

22. Notice

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Any notice or communication required hereunder between City and Owner must be in writing, and may be given either personally, by registered or certified mail (return receipt requested), or by Federal Express, UPS or other similar couriers providing overnight delivery. If personally delivered, a notice shall be deemed to have been given when delivered to the Party to whom it is addressed. If given by registered or certified mail, such notice or communication shall be deemed to have been given and received on the first to occur of (i) actual receipt by any of the addressees designated below as the party to whom notices are to be sent, or (ii) five (5) days after a registered or certified letter containing such notice, properly addressed, with postage prepaid, is deposited in the United States mail. If given by Federal Express or similar courier, a notice or communication shall be deemed to have been given and received on the date delivered, as shown on a receipt issued by the courier. Any Party hereto may at any time, by giving ten (10) days written notice to the other Party hereto, designate any other address in substitution of the address to which such notice or communication shall be given. Such notices or communications shall be given to the Parties at their addresses set forth below:

If to City: City of Cudahy
5220 Santa Ana Street
Cudahy, CA 90201
Attention: City Clerk
and Special Counsel, Glenn Ward Calsada, Esq.

Law Offices of Glenn Ward Calsada
23283 Ventura Boulevard
Woodland Hills, CA 91364
If to Owner: Aqua Tergere, LLC
8208 Atlantic Avenue
Cudahy, CA. 90201
If to Landlord: Vladimir Calderon
P.O. Box 2637
Downey, CA 90242

With a courtesy copy to:

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23. Miscellaneous Provisions
a. Amendment or Cancellation. This Agreement may be amended, or canceled in whole or in part, only by the written mutual consent of the parties to this Agreement or their successors in interest, except that minor amendments that do not affect a substantive provision of this Agreement may be approved by the City Manager on behalf of the City. The decision whether a proposed amendment is “minor” shall be in the exclusive discretion of the City Manager. b. Waiver. Waiver by City of any one or more of the terms or conditions of this Agreement shall not be construed as waiver of any other term or condition under this Agreement.
c. Enforcement/Reserved Powers. Unless amended or canceled pursuant hereto, this Agreement shall be enforceable by any party hereto, or successor in interest thereto, notwithstanding any subsequent change in any applicable general or specific plan, zoning, subdivision or building regulation, or municipal code amendment adopted by City that conflicts with the terms of this Agreement.

However, this Agreement is subject to the City's "Reserved Powers." For purposes of this Agreement, "Reserved Powers" means the rights and authority excepted from this Agreement's restrictions on the City's police powers and which are instead reserved to the City. The Reserved Powers include the powers to enact regulations or take future discretionary actions after the Effective Date of this Agreement that: (1) are necessary to protect the public health and safety, and are generally applicable on a City-wide basis (except in the event of natural disasters as found by the City Council such as floods, earthquakes and similar acts of God); (2) are amendments to California Marijuana Laws or California Uniform Codes, as adopted by the City of Cudahy, and/or the Cudahy Municipal Code, as applicable, regarding the construction, engineering and design standards for private and public improvements to be constructed on the Site; (3) are necessary to comply with state or federal laws and regulations; or (4) involve sign and parking ordinances and guidelines, changes to the Overlay Zone, Specific Plan or the City's General Plan, whether adopted previous or subsequent to the Effective Date of this Agreement).

If any City ordinance, rule or regulation or addition to the Cudahy Municipal Code is enacted or imposed by a citizen-sponsored initiative or referendum after the Effective Date that would conflict with this Agreement or an associated Regulatory Permit, business license or other authorizations and City approvals, or reduce development rights or assurances provided to the Owner in this Agreement, then such changes, additions or deletions to the Cudahy Municipal Code shall not be applied to the Site or Project; provided, however, the

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parties acknowledge that the City's approval of this Agreement is a legislative action subject to referendum. The parties shall cooperate with each other and undertake such reasonable actions as may be appropriate to ensure this Agreement remains in full force and effect and is implemented in accordance with its terms and to the fullest extent permitted by state or federal law.

Notwithstanding anything to the contrary in this Agreement, site improvements contemplated by this Agreement shall be completed pursuant to the development standards and design guidelines to be adopted by the zoning code amendment.
d. Joint and Several Liability. Owner shall be jointly and severally liable for any amount due under this Agreement, and any breach of this Agreement or failure to pay by one Party shall also constitute a breach of this Agreement by the other Party.
e. Severability. If any part of this Agreement is found to conflict with applicable state laws or regulations, such part shall be inoperative, null, and void insofar as it conflicts with said laws or regulations, or modified or suspended as may be necessary to comply with such state laws or regulations, but the remainder of this Agreement shall continue to be in full force and effect. f. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument. The execution of this Agreement may be by actual, facsimile, or electronic signature.
g. Jurisdiction. The law governing this Agreement shall be that of the State of California. Any suit brought by any party against any other party arising out of the performance of this Agreement or the breach, termination, enforcement, interpretation or validity thereof, shall be filed and maintained in the County of Los Angeles Superior Court.
h. Disclaimer. Despite California’s commercial cannabis laws and the terms and conditions of this Agreement, any Conditional Use Permit, or any Regulatory Permit issued pertaining to Owner or the property specified herein, California commercial cannabis cultivators, transporters, distributors, or possessors may still be subject to arrest by state or federal officers and prosecuted under state or federal law. The Federal Controlled Substances Act, 21 USC § 801, prohibits the manufacture, distribution, and possession of cannabis without any exemptions for medical use.

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i. Force Majeure. If delays are caused by unforeseen events beyond the control of Owner, such delays will entitle Owner to an extension of time as provided in this section. Such unforeseen events (“Force Majeure”) shall mean war, insurrection, acts of God, local, state or national emergencies, strikes and other labor difficulties beyond the party’s control, or any default by City hereunder, which Force Majeure event substantially interferes with the development, construction or operation of the Project.
j. Costs and Fees. Intentionally omitted.
k. Constructive Notice and Acceptance. Every person who after the Effective Date and recording of this Agreement owns or acquires any right, title, or interest to any portion of the Site, is and shall be conclusively deemed to have consented and agreed to every provision contained herein, whether or not any reference to this Agreement is contained in the instrument by which such person acquired an interest in the Site, and all rights and interests of such person in the Site shall be subject to the terms, requirements, and provisions of this Agreement.
l. Binding Effect of Agreement. The Parties agree that the Recitals above are true and correct and intend to be bound by same. Except as otherwise provided, the burdens of this Agreement are binding upon, and the benefits of this Agreement inure to, all authorized successors-in-interest of the Parties and constitute covenants which run with the Site. In order to provide constructive notice thereof, the City Clerk will record this Agreement with the Los Angeles County Recorder within the period required by Government Code Section 65868.5.
m. Project as a Private Undertaking. It is specifically understood and agreed by and between the parties hereto that the development of the Project is a private development, that neither party is acting as the agent of the other in any respect hereunder, and that each party is an independent contracting entity with respect to the terms, covenants and conditions contained in this Agreement. No partnership, joint venture or other association of any kind is formed by this Agreement. The only relationship between the City and the Owner is that of a government entity regulating the development of private property and the owner of such property.
n. Changes to Project. The parties acknowledge that changes to the Project or Development Plans and related approvals may be appropriate and mutually desirable to carry out the intent and purpose of this Agreement. This Agreement shall not prevent the City from applying, with the consent or at the request of the

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Owner, Subsequent Land Use Regulations or Subsequent Development Approvals that do not directly conflict with the Project, Site or Development Plan authorized under this Agreement. The granting of one such change or request shall not obligate the City to grant other similar changes or requests. As used herein, “Subsequent Development Approvals” include, without limitation, all excavation, grading, building, construction, demolition, encroachment or street improvement permits, occupancy certificates, utility connection authorizations, or other non-discretionary permits or approvals necessary, convenient or appropriate for the Project. As used herein, “Subsequent Land Use Regulations” means ordinances, resolutions and codes adopted or approved by the City after the Effective Date of this Agreement governing the development and use of the land, including general plan amendments, zone changes, variances or conditional use permits affecting the permitted use of the land including density or intensity of use, subdivision requirements, the maximum height and size of proposed buildings, the provisions of reservation or Dedication of land for public purposes, and the design, improvement and construction and initial occupancy standards and specifications applicable to the Development of the Property. o. Conflicting Federal or State Rules. In the event that any conflicting federal or state laws or regulations, enacted after the Effective Date, prevent or preclude compliance with one or more provisions of this Agreement or require changes in plans, maps or permits approved by the City, this Agreement shall remain in full force and effect as to those provisions not affected; and (i) Notice of Conflict. Either party, upon learning of any such matter, will provide the other party with written notice thereof and provide a copy of any such law, regulation or policy together with a statement of how any such matter conflicts with the provisions of this Agreement; and (ii) Modification Conferences. The parties shall, within thirty (30) days of the notice referenced to in the preceding subsection, meet and confer in good faith and attempt to modify this Agreement to bring it into compliance with any such federal or state law or regulation.
(iii) City Council Hearings. In the event the City believes that an amendment to this Agreement is necessary due to the effect of any federal or state law or regulation, the proposed amendment shall be scheduled for hearing before the City Council. The City Council shall determine the exact nature of the amendment necessitated by such federal or state law or regulation. Owner shall have the right to offer oral and written testimony at the hearing. Any modification ordered by the City Council pursuant to such hearing is subject to judicial review in accordance with California law.

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(iv) City Cooperation. The City shall cooperate with Owner in securing any City permits, licenses or other authorizations that may be required as a result of any amendment resulting from actions initiated by the City. As required by this Agreement, Owner shall be responsible to pay all applicable fees in connection with securing of such permits, licenses or other authorizations.
p. Effective Date. “Effective Date” means the date on which all of the following are true: (i) thirty (30) days have elapsed since the second reading of the Ordinance adopting and approving this Development Agreement and (ii) all Exhibits to this Agreement are finalized, executed and notarized by all affected parties (if applicable) and attached hereto; provided, however, that if these conditions have not been fully satisfied by the Owner the Effective Date may not thereafter occur and this Agreement may not thereafter become effective.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and year first above written.

CITY OF CUDAHY Aqua Tergere, LLC
OWNER

Chris Garcia Name: Charles Arden
Mayor Title: Managing Member

OTHER PARTY

Name:

Title:

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APPROVED AS TO FORM:

Glenn Ward Calsada, Attorney at Law
Special Counsel for the City of Cudahy

EXHIBITS

A LEGAL DESCRIPTION

B PARCEL MAP

C LANDLORD CONSENT

D SITE AND FLOOR PLANS

E ADDITIONAL BUSINESS STANDARDS (IF APPLICABLE)

F STANDARDS AND CONDITIONS FOR CONSTRUCTION (IF APPLICABLE)

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EXHIBIT “A”

LEGAL DESCRIPTION

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APN: 6224-023-020
Los Angeles County
Calderon J Vladimir; Calderon Family Trust
8210 Atlantic Ave, Cudahy, CA 90201
Owner Information
Primary Owner: CALDERON J VLADIMIR;

CALDERON FAMILY TRUST
Secondary Owner:

Mail Address: PO BOX 2637
DOWNEY CA 90242
Site Address: 8210 ATLANTIC AVE
CUDAHY CA 90201
Assessor Parcel Number: 6224-023-020
Census Tract: 5343.01 Housing Tract Number: 180
Lot Number: 213,214 Page Grid: 705-E2
Legal description: Lot: 213,214 Tract No: 180 Abbreviated Description: LOT:213,214 TR#:180 TRACT NO 180 N 160 FT OF LOTS 213 AND LOT 214 IMP1=IND,432SF,YB:1955,1STY;IMP2=IND,2490SF,YB:1965,1STY.

Sale Information
Sale Date: Document #: Sale Amount: N/A
Seller: Sale Type: Cost/SF: N/A
Assessment & Tax Information
Assessed Value: $889,768 Land Value: $856,405 Imp. Value: $33,363 Homeowner
Exemption:
% Improvement: 3.75%
Tax Amount: $11,610.70 Tax Status: Current Tax Year: 2017 Tax Rate Area: 0-631 Tax Account ID:

Property Characteristics
Bedrooms: Year Built: 1965 Pool:

Bathrooms: Square Feet: 2,922 SF Lot Size: 33,623 SF
Partial Baths: Number of Units: 0 No of Stories: 1
Total Rooms: Garage: Fire Place:

Property Type: Industrial Building Style: Owner
Exclusions:

Use Code: Manufacturing (Light) Zoning: CUM2*
Aerial Map

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EXHIBIT “B”

PARCEL MAP

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EXHIBIT “C”

LANDLORD CONSENT

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EXHIBIT “D”

SITE AND FLOOR PLANS

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MAX. TRAVEL DISTANCE = 140'-0" MAX. TRAVEL DISTANCE = 149'-2" 2 3 4 5 6 7 8 ABCDEF 1 9 2 3 4 5 6 7 8 1 9 ABCDEF JOB NO.: DRAWN BY: PA / PM: DATE REMARKS

INFRASTRUCTURE

ENGINEERS
3060 Saturn Street, Suite 250
Brea, CA 92821
Tel: (714) 940-0100
Fax: (714) 940-0700
www.infrastructure-engineers.com ARCHITECT / CIVIL ENG. CONSULTANT STAMP THIS DOCUMENT, WHICH CONCEPTS, DRAWINGS AND INCORPORATES THE DESIGN SPECIFICATIONS IS THE PROPERTY AND COPYRIGHT OF INFRASTRUCTURE ENGINEERS AND SHALL NOT BE USED IN WHOLE OR IN PART ON ANY OTHER WORK WITH INFRASTRUCTURE EXCEPT BY AGREEMENT CUDAHYGRO ENGINEERS. 4311 SANTA ANA STREET
CUDAHY, CA 90201
Fri, 17 Aug 2018 08/03/18 - CUP RESUPMITTAL A0.5
OCCUPANCY AND EGRESS PLAN A.D. SCALE: OCCUPANCY AND EGRESS PLAN A 1/8"= 1'-0" 716 SQ. FT DELIVERY OFFICE 132 SQ. FT OFFICE 143 SQ. FT JANITOR'S 37 SQ. FT CLOSET GOWNING ROOM 204 SQ. FT NURSERY 1153 SQ. FT 705 SQ. FT & LABELING PACKAGING VAULT 143 SQ. FT 490 SQ. FT RECEIVING SHIPPING & CULTIVATION 1460 SQ. FT EXTRACTION 424 SQ. FT 718 SQ. FT DRY / CURE TRIM 171 SQ. FT POST-PROCESSING 449 SQ. FT COMMERCIAL KITCHEN 885 SQ. FTSECURE 582 SQ. FT STORAGE59 SQ. FT STORAGE COLD SHOW ROOM 59 SQ. FT OFFICE 73 SQ. FT 65 SQ. FT SERVER SECURE VAULT 73 SQ. FT 632 SQ. FT DISTRIBUTION RECEPTION CULTIVATION 1008 SQ. FT UNISEX 112 SQ. FT RESTROOM UNISEX RESTROOM 64 SQ. FT ELECTRICAL ROOM 180 SQ. FT CORRIDOR 198 SQ. FT NURSERY EQUIPMENT YARD FERTIGATION ZONE / LEGEND RESTROOM SUMMARY MAXIMUM TRAVEL DISTANCE TO EXITS: OCCUPANCY & EXIT LEGEND OCCUPANT LOAD CALCULATIONS 456 SQ. FT BUILDING SECURITY FERTIGATION ROOM 128 SQ. FT

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SANTA ANA ST.

SALT LAKE AVE.

CL
CL JOB NO.: DRAWN BY: PA / PM: DATE REMARKS

INFRASTRUCTURE

ENGINEERS
3060 Saturn Street, Suite 250
Brea, CA 92821
Tel: (714) 940-0100
Fax: (714) 940-0700
www.infrastructure-engineers.com ARCHITECT / CIVIL ENG. CONSULTANT STAMP THIS DOCUMENT, WHICH CONCEPTS, DRAWINGS AND INCORPORATES THE DESIGN SPECIFICATIONS IS THE PROPERTY AND COPYRIGHT OF INFRASTRUCTURE ENGINEERS AND SHALL NOT BE USED IN WHOLE OR IN PART ON ANY OTHER WORK WITH INFRASTRUCTURE EXCEPT BY AGREEMENT CUDAHYGRO ENGINEERS. 4311 SANTA ANA STREET
CUDAHY, CA 90201
Fri, 17 Aug 2018 08/03/18 - CUP RESUPMITTAL SCALE: PROPOSED SITE PLAN A 1/16"= 1'-0" A1.1
PROPOSED SITE PLAN A.D.

N LEGENDS SITE NOTES EXISTING BUILDING ±12,000 SF ADDITION EXISTING ±950 SF EXISTING ELECTRICAL ROOM ±212 SF EXISTING SHED TO REMAIN N.I.C. EXISTING SHED TO REMAIN N.I.C. EXISTING SHED TO REMAIN N.I.C. BUILDING SECURITY ±456 SF PARKING CALCULATIONS ZONE: INNOVATIVE INDUSTRIAL APN: APN: ZONE: INNOVATIVE INDUSTRIAL SINGLE FAMILY USE: RESIDENTIAL USE: COMMERCIAL / INDUSTRIAL ZONE: INNOVATIVE INDUSTRIAL WINDOW MANUFACTURER ZONE: INNOVATIVE INDUSTRIAL USE: COMMERCIAL / MANUFACTURER WINDOW INDUSTRIAL PROJECT INFORMATION LANDSCAPE CALCULATIONS BOTH PROPERTIES SHARED ACCESS TO USE: COMMERCIAL / INDUSTRIAL ZONE: INNOVATIVE INDUSTRIAL WINDOW MANUFACTURER ZONE: INNOVATIVE INDUSTRIAL SINGLE FAMILY USE: RESIDENTIAL ZONE: INNOVATIVE INDUSTRIAL SINGLE FAMILY USE: RESIDENTIAL ZONE: INNOVATIVE INDUSTRIAL SINGLE FAMILY USE: RESIDENTIAL ZONE: INNOVATIVE INDUSTRIAL USE: RESIDENTIAL SINGLE FAMILY ZONE: INNOVATIVE INDUSTRIAL USE: RESIDENTIAL SINGLE FAMILY ZONE: INNOVATIVE INDUSTRIAL ZONE: INNOVATIVE INDUSTRIAL SINGLE FAMILY USE: RESIDENTIAL USE: RESIDENTIAL SINGLE FAMILY ZONE: INNOVATIVE INDUSTRIAL USE: COMMERCIAL / INDUSTRIAL ZONE: INNOVATIVE INDUSTRIAL WINDOW MANUFACTURER 6

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JOB NO.: DRAWN BY: PA / PM: DATE REMARKS

INFRASTRUCTURE

ENGINEERS
3060 Saturn Street, Suite 250
Brea, CA 92821
Tel: (714) 940-0100
Fax: (714) 940-0700
www.infrastructure-engineers.com ARCHITECT / CIVIL ENG. CONSULTANT STAMP THIS DOCUMENT, WHICH CONCEPTS, DRAWINGS AND INCORPORATES THE DESIGN SPECIFICATIONS IS THE PROPERTY AND COPYRIGHT OF INFRASTRUCTURE ENGINEERS AND SHALL NOT BE USED IN WHOLE OR IN PART ON ANY OTHER WORK WITH INFRASTRUCTURE EXCEPT BY AGREEMENT CUDAHYGRO ENGINEERS. 4311 SANTA ANA STREET
CUDAHY, CA 90201
Fri, 17 Aug 2018 08/03/18 - CUP RESUPMITTAL SCALE: ENLARGED SITE PLAN A 1/16"= 1'-0" A1.2
ENLARGED SITE PLAN A.D.

N LEGENDS SITE NOTES SCALE: ENLARGED SITE PLAN
B 1/16"= 1'-0"

N EXISTING BUILDING ADDITION EXISTING EXISTING ELECTRICAL ROOM BUILDING SECURITY

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2 3
4 5
6 7
8 ABC
D
E
F
1 9
2 3
4 5
6 7
8 1
9 ABC
D
E
F JOB NO.: DRAWN BY: PA / PM: DATE REMARKS

INFRASTRUCTURE

ENGINEERS
3060 Saturn Street, Suite 250
Brea, CA 92821
Tel: (714) 940-0100
Fax: (714) 940-0700
www.infrastructure-engineers.com ARCHITECT / CIVIL ENG. CONSULTANT STAMP THIS DOCUMENT, WHICH CONCEPTS, DRAWINGS AND INCORPORATES THE DESIGN SPECIFICATIONS IS THE PROPERTY AND COPYRIGHT OF INFRASTRUCTURE ENGINEERS AND SHALL NOT BE USED IN WHOLE OR IN PART ON ANY OTHER WORK WITH INFRASTRUCTURE EXCEPT BY AGREEMENT CUDAHYGRO ENGINEERS. 4311 SANTA ANA STREET
CUDAHY, CA 90201
Fri, 17 Aug 2018 08/03/18 - CUP RESUPMITTAL AD.1 DEMO PLAN A.D. SCALE: DEMO PLAN A 1/8"= 1'-0"

N LEGENDS DEMOLITION FLOOR NOTES WALL LEGEND

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2 3
4 5
6 7
8 ABC
D
E
F
1 9
2 3
4 5
6 7
8 1
9 ABC
D
E
F JOB NO.: DRAWN BY: PA / PM: DATE REMARKS

INFRASTRUCTURE

ENGINEERS
3060 Saturn Street, Suite 250
Brea, CA 92821
Tel: (714) 940-0100
Fax: (714) 940-0700
www.infrastructure-engineers.com ARCHITECT / CIVIL ENG. CONSULTANT STAMP THIS DOCUMENT, WHICH CONCEPTS, DRAWINGS AND INCORPORATES THE DESIGN SPECIFICATIONS IS THE PROPERTY AND COPYRIGHT OF INFRASTRUCTURE ENGINEERS AND SHALL NOT BE USED IN WHOLE OR IN PART ON ANY OTHER WORK WITH INFRASTRUCTURE EXCEPT BY AGREEMENT CUDAHYGRO ENGINEERS. 4311 SANTA ANA STREET
CUDAHY, CA 90201
Fri, 17 Aug 2018 08/03/18 - CUP RESUPMITTAL A2.1
PROPOSED FLOOR PLAN A.D. SCALE: PROPOSED FLOOR PLAN
A 1/8"= 1'-0" LEGENDS FLOOR NOTES WALL LEGEND (E) 1:12 RAMP

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EXHIBIT “E”

ADDITIONAL BUSINESS STANDARDS
(IF APPLICABLE)

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ATTACHMENT D.

Planning Commission Draft Minutes
September 17, 2018

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ACTION MINUTES

CUDAHY PLANNING COMMISSION
A Meeting to be held in the City Council Chambers,
5240 Santa Ana Street, Cudahy, California,
Monday, September 17, 2018 – 6:00 P.M.

1. CALL TO ORDER
Vice Chairperson Alcantar called the meeting to order at 6:23 p.m.

2. ROLL CALL

Present:   Vice Chair Alcantar
Commissioner Becerra
Commissioner Corvera‐Hernandez
Commissioner Ortega

Absent:  Chairman Fuentes
Staff Present:   Interim Community Development Manager, Salvador Lopez Jr.

Economic Development Principal Planner, Ebony J. McGee Andersen, Deputy City Attorney, Martin De Los Angeles
Special Counsel, Vincent F. Sarmiento

3. PLEDGE OF ALLEGIANCE
Pledge of Allegiance was led by Vice Chair Alcantar

4. PRESENTATIONS – NONE

5. PUBLIC COMMENT
Vice Chairperson alcantar announced that this was the time set aside for citizens to address the Planning Commission on matters relating to Commission business. When addressing the Commission please speak into the microphone and voluntarily state your name and address. Each person will be allowed to speak only once and will be limited to five (5) minutes. The proceedings of this meeting are recorded on audio CD.

Adriana Leanos:  My name is Adriana Leanos, and I live here on Santa Ana Street. These are my father (Raul) and mother‐in‐law (Angelica Martinez) and we’ve come to express ourselves, that we are not, we don’t  want them to have these things going on because I  have kids and we still smell the smoke from people that smoke the pot and it’s not healthy for our kids and it goes into our house even though there is rules, but it goes into our house and unfortunately, we can’t tell them “Hey, don’t smoke” because of the laws that are approved now. They go outside in the car and they smoke, and everything goes inside. So, we are basically against this to be held upon our kids.

Angelica Martinez (Spanish) – I do not want the marijuana to be approved. Because we can’t stand our resident’s neighbors anymore who continue to have parties and we can no longer tolerate it.

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And if there is more, it is going to get worse.  How will you assure that there will not be any more crime in the city?  and we prefer that you do things to improve the schools and concentrate on speed bumps around the schools the community.

Patricia ‐ Hello, my name is Patricia, I’m a resident of Cudahy for more than 25 years. Um you guys already approve 21 dispensaries. You guys need more? Two, three more? I don’t think so. we don’t need no marijuana dispensaries right here in Cudahy.  It says testing. We’re going to be smelling what they are manufacturing, the smell, the stinksfor our kids. There’sfive schoolsin Cudahy, three parks, we have a lot of kids, a lot of working people.  We need things for the community. We don’t want no more dispensaries.   You’re running Elizabeth? You’re running for council member? Are you ashamed? You already approved 21 dispensaries. And you’re telling the people you work for Lugo Park? You and Baru you voted against the Lugo Park. Baru said no, he doesn’t want no money going towards Lugo Park but you guys are approving dispensaries?  And you guys live here in the city? You guysshould be ashamed. We don’t need no more dispensaries.  We don’t need marijuana here.

We don’t need cannabis or whatever you call it.  We need things for the community. Even if you laugh, Ortega.

Carmen Beltran (Spanish) – I’m a resident of Cudahy for 28 years and I have my own home and truly we’ve been fighting against you this for two years about the Marijuana.  You guys know that we have tried to pass the referendum/initiative and you have kicked it back.  But the truth is that the citizens are fed up and it’s not fair for you to do this because the people here in this community are poor, but they are honest, and they want a clean city.  You can’t tell me that there will be security, and nothing will happen, and that marijuana is legal and everything.   The politicians are now “narcopoliticians”.  This is not good for a community at all.  Yes, marijuana is medicinal and is legal, but its only legal for those who are narcopoliticians.  When was there ever a crime in the beautiful city of Whittier?   Looks at what’s happening to the city of Whittier a year later after bringing in dispensaries.  Go and take a look at their crime rate increase. It’s true.  If you don’t watch the news and you are not up to date, it’s not a joke.  You guys made the city a sanctuary city?  For what?  To no listen to the residents.  Here the people are poor and humble, and we are one of the safest cities in California.  I’ve been reading a lot of statistics and honestly, place your hand on your conscience because in reality the councilmembers only came to Cudahy to use it as a stepping stone to become politicians and it’s not fair.  The people are not dumb.  Again, place your hands on your conscience, there are 5 elementary schools in Cudahy.  Is this the type of neighborhood that you want to give the kids from those 5 elementary schools?  We don’t marijuana cultivation in Cudahy.  We are not dumb, we are up to date.  Elizabeth, you know didn’t want to pass the thing at the Catholic school.

But it’s true, people are tired of not having politicians for the people.  They are narcopoliticians and it’s not fair.

Having no further speakers – Public Comment was closed.

6. WAIVE FULL READING
A.   Approval to waive the full text reading of all resolutions on the agenda and declare that said titles which appear on the public agenda shall be determined to have been read by title only.

Recommendation: Motion to waive the full text reading of all resolutions on the agenda.

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MOTION:   Commissioner Corvera‐Hernandez moved the motion to approve item 6A, motion seconded by Commissioner Ortega, which carried with the following roll call vote:

Ayes:          Commissioners Becerra, Corvera‐Hernandez, Ortega, and Alcantar Noes:   None
Abstention: None

Absent:   Chair Fuentes
Motion Approved

7. PUBLIC HEARING
A. Commercial Cannabis Permit (CC) No. CCP18‐0011 and Development Agreement (DA) No. DA18‐ 011C (Location: 8210 Atlantic Avenue, Applicant Aqua Tergere, LLC):

Economic Development Principal Planner McGee Anderson presented a powerpoint presentation providing an overview of the proposed project, overview of the community benefit, current locations/applications that have been approved, and what has been received thus far.

Interim Community Development Manager Lopez clarified that the item presented was item 7B on the agenda.

Vice Chair Alcantar asked staff to clarify which applications were approved at the last Planning Commission Meeting.

Principal Planner McGee confirmed that Natures Natural and Nyce Guys were the two applications approved at the last Planning Commission Meeting.

Vice Chair Alcantar declared the public hearing open for agenda item 7B.

PUBLIC COMMENT:

Adriana Leanos:  Again, my name is Adriana Leanos and basically, the same thing, I do not approve.

We have children, it’s awful having your child grow with that smoke around them.

Again, my name is Hope.  I’m not against it.  If they have a medical condition, they need it.  It’s recreation. They have to go somewhere else.  I have seen people in Elizabeth park smoke.  My son used to go to that school. The police person outside in the morning had to go to the park to get someone there.  It’s horrible seeing our kids in a playground, in a park having to see people smoke for recreation.  There is people that need it. I’m not against the people that need it but there has to be a solution where kids don’t have to see that, smell it.  Again, we’re a small community.  Five schools, there isfive schools and there is a lot of elementary kids here that I’ve seen walking around Elizabeth Street.  If you don’t have kids, I urge you to think about when you have kids what’s the future their going to grow into.  We’re a small community, we’d like to have our kids grow into a better future.  I saw the picture you have of kids playing, why not invest in kids playing, education is the first thing that comes into a mother’s mind because kids are the future of tomorrow. If you

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teach your kids that’s normal, that that’s because they are sick, your kids going to grow up thinking, “oh that’s normal, I’m going to smoke”, What’s happening with those commercials that are coming out? Kids are thinking about the one that tastes like candy. Your kids are going to think that’s normal. We need to think in the future.  You’re all young.  Most of you must have kids or grandkids, cousins, nieces, nephews.  Think about the little kids.  I have a six‐year‐old, a five‐year‐old so I have to so I urge you to think about that. As a mother I think about that.  Thank you Carmen Beltran My name is Carmen Beltran, I just want to say that I know the neighbors who are in the houses adjacent to this facility and he is totally not in support of this.  He says that he was never notified of the meeting and I think that they are.  He has many properties in this community and it is not fair that he wasn’t notified.  Where are the people.

CD Manager Lopez indicated that the City, as part of the cannabis application process, is required to notify all property owners within 300 feet of the said property.  Public notices were sent out to every property owner within 300 feet.

ADDITIONAL PUBLIC COMMENT:

My name is Marco Covarrubias.  I’m a resident of Cudahy and myself, I’m probably against the distribution, manufacturing etc. of marijuana, and right here we have a person running for city council and the public in the city is very interested in finding out if you support this type of business.

And I got a lot of people who knows that you’re running, and sometimes they don’t believe that you are supporting this business.  But we will take the message to the church, to the residents, we’ll do the best we can to distribute the information that you are supporting this and the rest of the people supporting it. I see if this 1, 2 or 3 but 20, that’s the number that we keep hearing. 20 possibly 23.

You guys are going beyond reasonable. So, but anyway that information is troubling and we going to remember that.  I’ll take the message to the voters that you are supporting it. And there’s people right here, writing with their telephones to hear the way you want to go. Thank you Chair Alcantar closed public comment.

Ebony provided the following clarifying comments:

The Ordinance for the City is only medicinal. So, all of these licenses are for medicinal cannabis only.

We don’t allow any dispensaries or any recreational or adult use at this time.

Vincent Sarmiento addressed the Commission.

Sir, if you don’t mind, so madam chair, and members of the commission. I am Vince Sarmiento, Special Council for the City of Cudahy.  Because you are in a formal hearing, you want to make sure that you limit the dialogue. It’s more the opportunity to speak for the public, and for you to absorb that, and for you to deliberate amongst yourselves, and then to ask questions of staff so you can have a clear record.

Principal Planner McGee provided additional comment:

Also, commissioner, there are all of the permits have a provision that prevent any of the operators

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to allow any on‐site consumption.  That’s also a state law so we can’t approve anything that would allow on‐site consumption with any facility.  So, if you have a commercial cannabis license you can’t smoke on the property so that would not be happening. If they did that, it would be in violation of the permit. The last thing isthe odor control, we talked about this at our last meeting, but I just want to talk about or bring it up again.  We have an odor control plan for every facility. The state also requires one. Those are reviewed and any emissions that exceed the thresholds that would also be analyzed by the AQMD. (Air Quality Management District) Vincent Sarmiento provided additional clarifying comments.

A couple more additional clarifying comments just for the council’s information. Anybody who didn’t receive notice, because as you know notices were supposed to be mailed to anybody who is a property owner. Sometimes because they are tenants they don’t receive those, and it goes maybe to somebody who is out of state or out of the area because their the record owner. In the event that they don’t have the chance to come here, there will be two other opportunities. First reading of city council in the event that this gets adopted. So this won’t be the only time for residents who are not here today, have the opportunity to comment?.   And the last thing was, I believe when the presentation was made, it was $800,000 for the community benefits, that’s on an annual recurring basis. Just for clarity.

Principal Planner McGee provided additional clarification:

And just for clarification, we did put out noticing for the 300 radius, as well as the website and as well as city hall.  All three.

Vice Chair Alcantar asked if the applicant would like to come forward with answers, comments, or anything.

COMMISSION COMMENT:

Commissioner Ortega addressed the audience:

Alright, I really want to thank. I’m sorry, I didn’t catch your name.  I really want to thank you for coming out and bringing your in‐laws.  I think all of your points are valid. I thank everyone else for coming who has concerns about the agenda items tonight.  I think we can agree that we don’t like the public use of it. You know if you’re walking down the street and you’re smelling it and you’re around kids smoking it.  I think we can all agree that that is a problem. But, other than that, I do want for the record and for transparency reasons, there was an accusation that I didn’t live in the city, I do live in the city. I wouldn’t be here if I wasn’t living in the city. And so, that’s it.

Vice Chair Alcantar provided the following comments:

So, I do have some comments about this project in particular as well. One issue and I had brought it up with some of our council members is when we were talking about the general plan and what our city would look like in the future, we have community members when we have these planning meetingsthat was not open??? We had talked about Atlantic Blvd being a commercial corridor, with like, I think most of us envisioned restaurants, nightlife, store fronts.  We had talked about mixed

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use buildings and so what I envisioned as a commissioner but also as a resident was you know first floor, second floor restaurants, again, all these stores that I mentioned and then the top being housing.  So, this definitely variesfrom what we had been talking about. Um,so I think from the very beginning, I brought up Atlantic Blvd, I think in conversations with Commissioner Ortega as well.

That Atlantic Blvd, specifically this project was a huge concern for me because it is on Atlantic Blvd. and secondly, its right next to the DPSS office which I think is a huge concern.  Its’s next to an office that’ssupposed to be serving the community with food stamps, medicare, and so for me, this project is really, really, tough for me to look atseriously. Um, I know the council will have their opportunities 1st, 2nd readingsto make their decisions.  For me, those two are the biggest concernsfor this project.

Ebony thanked Madam Chair and responded with the following:

Just to respond to that. This project, this parcel, isn’t actually on Atlantic. This parcel is actuallyin the rear. The property in front of it is. So that would still be subject to the primary entertainment use.  I totally understand what you’re saying, you did think aboutthat and we did have conversations about that. But it’s a very small facility and whatever is proposed for the parcel in front of it would pretty much walk in from the site.  That is one of the reasons why this, and it meets the zoning. So that’s why we are here today. But we do have some security measures in place on this property in which it will have the block wall and the fencing to separate it from whatever will be in front of it along Atlantic. So, it will be stand alone.  It does include that five‐foot buffer to the city for landscaping and all other provisions.

Vice chair Alcantar response:

Okay and then my fourth questions would be I guess, when I was asking questions about thisspecific project and it being so close to the DPSS facility, the response that I received was that the DPSS building will not be there for long. So, I’d like to hear about that from city staff as well.

Ebony’s response:  I do believe that the Council is thinking about doing something like a Civic Center, giving future housing, a future place for the civic institutions in the city, including and city hall and DPSS.  We did notify DPSS about this project, but we didn’t receive any comments from them.  So, they didn’t object to the project.

Alcantar asked a follow‐up question:

But, if I can also know for my record, does the notice go out when the agenda items go out, or when the applicant submits?
Ebony’s response:

It goes out 10 days before the hearing. That’s a legal requirement.

Vincent Sarmiento provided additional comment/clarification:

And one more thing, madame chairwoman, is that the enabling ordinance, ordinance 673, specifically has in there the issue with Atlantic. So, it has to be bound to a, if there is any cannabis use, or it’s related use. It has to be tied to an entertainment function. Just so that part of the street

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is kept, the integrity of it is kept the way you want it. And the way the policymakers wanted it to be activated so this one is set   back.  If it were on the frontage, if it did have anything exposed to Atlantic, it would have to be tied to some other entertainment use. But this one isn’t obviously, so this one is set back, and it wouldn’t fall under that.  But you do have some prohibitive language in your ordinance that prevents anybody from having a storefront.

Vice Chair Alcantar asked for additional commission comments.

Commissioner Becerra provided the following comment:

I just want to clarify some facts regarding dispensary licensing, I just want to clarify and make clear and definitively say and have everything cleared up.  There aren’t any dispensaries. There aren’t any dispensaries.  How many operators are having to go through this vetting process? Principal Planner McGee responded:

Well we have a total of, about we hear the number 20 because that’s how many operators we have, but we really only have 13, we’ll we have a total of 14 proposed locations.  One is going to be a full development project so that won’t happen until sometime next year. Um, if it goes forward we, that one’s on hold so we have 13 approved or authorized to be presented to your council projects. Which I think you’ve heard 7 so far. So those are the 7 licensed facilities that we have currently, and this will add to that which will make 9.  It’s a total of 14 development agreements. None of which have dispensaries, none of which are open to the public, um and none of them allow on‐site consumption.

Vincent Sarmineto provided additional comment:

Commissioner, everything you’ve adopted to this point is the same way. Right, so your ordinance prohibits you from granting a license or permit to a retail operator, a dispensary. So, it’s forbidden, you couldn’t move forward in any event.  None of the applications submitted so far are anything but the supply side. So, It’s for the manufacturing, for the production. So, it’s not going to be sold here.

It’s for other communities that have decided to go ahead and have that retail dispensary use. And you should know that a lot of these operators that are eligible that Ms. McGee spoke about, that doesn’t mean that they are going to by right to come in. They are still in the process, some of them may not make it, some of them might decide not to move forward so, that number 20 is sort of an abstract number. That’s how many applied, but they may not all make it for reasons of such as finances and being able to go ahead and make it.

Commissioner Becerra provided follow‐up comment:

Appreciated the comments. Like what you had to say about your children for instance. I for one am not a fan of the smell. But it appears that this is for medicinal purposes. I have a disabled father who is completely incapacitated mentally and cognitively.  In so far as rather than having him, giving him some opioids. You know there’s a big opioid crisis in this country. I have provided my father with some medicinal components of a cannabis and it’s been effective. I just wanted to make that point about the recreational use, I’m certainly not a big fan of it. Thank you for raising those points.  I do agree with what you said about the sometimes, unfortunate consequence of the legalization of it, leads to delinquency. But uh, I think like with most liberal decisions, if you weigh the pros and the

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cons in so far as this is concerned, this is all medicinal. I do not believe this is going to foster an increase in the delinquency or recreational use. On the contrary, I think it will be beneficial.  Again, my father has an illness.  Again, on the recreationalside, I agree with you 100%. Thank you forraising those points.

Vice Chair Alcantar called for an entertainment of a motion. 1st MOTION:  Commissioner Becerra moved the motion to approve item 7A, motion failed due to lack of a 2nd.
2nd MOTION:   Vice Chair Alcantar moved the motion to deny item 7A, motion seconded by Commissioner Ortega, which carried with the following roll call vote:

Ayes:          Commissioners Corvera‐Hernandez, Ortega and Alcantar Noes:   Becerra
Abstention:

Absent:   Chair Fuentes

Motion Approved 3‐1

B. Commercial Cannabis Permit (CC) No. CCP18‐0002 and Development Agreement (DA) No. DA18‐ 002C (Location: 4311 Santa Ana Street, Applicant 420 Realty):

Economic Development Principal Planner McGee Anderson presented a powerpoint presentation providing an overview of the proposed project.

Principal Planner Mc Gee indicated that one public comment from an adjacent property owner was received.  They expressed concerns about security and safety in general, welfare of the community as well as property values.

Vice Chair Alcantar asked if there was a copy of the comments.

Principal Planner McGee indicated that they did not submit it in writing. They just called. Ebony was able to talk to the property owners and address all of the concerns and invited the property owners to the hearing or to submit formally. They just have to submit verbally.

Vice Chair Alcantar asked if the applicant was in attendance and asked if the applicant would like to give any comments, or if there are any questions from the commission to the applicant.

Vice Chair Alcantar opened the public hearing.

Public comment:

Hi, my name is Miranda, I’m a lifelong citizen of Cudahy. The problem that I see arising from 420 Realty is not necessarily the industry that it represents, but, it’s a facet of High Hamptons holdings, which is a multi‐million‐dollar industry and when big money comes into play in a small city, problems arise. I, y’all are the representatives of the city, of the community itself, the people

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and seeing that we have history in Cudahy of corruption and the likes of that.  On top of that the CEO of High Hamptons is a public servant themselves.  They are a council member in the city of La Puente, and I just don’t like the conflict of interest there. I just don’t like the possibilities it can bring to the city and just putting like it out there like full disclosure. I don’t feel comfortable with the possibilities. Thank you.

Adriana Leanos. So, this is the first meeting I’ve come to. I just did get the paper but in English, again. So if it was, if we had the paper in Spanish I think more people would come here and see what’s going on with our city.  Because unfortunately, it’s not possible because most of our residents speak Spanish. It has to be in dual language.  For the other ones, I live close to Atlantic. I did not get the one from, that’s at Salt Lake and Atlantic, like I was not notified about that I am close to that plant.  I did get the one from here.  The second thing, we are going to have problems, you’re saying it’s not maybe going to bring problems into the city but in the long run. it is going to be a problem here having this type of activity. I’m not against you know like medical because I have friends that need it for medical reasons, but again recreational, it is going to bring, even if its’ not recreational and if it’s permitted, we’re going to have problems in the city.  What is going to be the solution?  I’m just going in the long run, if you approve this what’s your solution to us as residents, what’s our, how are you going to protect us against all these people that they are going to be smoking? How are you going to protect our kids about seeing this daily? What’s going to be the solution in the long run, if this is approved? Which I am against and my family is against because we have people smoking for recreational next door to us. So, I need to see both sides as well. I know you guys want to bring money through this to our city, but I think there will be other ways to hopefully bring money to the city, for our kids and our community. Kids are our future.

Just think about that, we are all grown up now.  We all grew up through our phase.  The future is already here for our kids. Let’s educate our kids, give them programs for sports, reading. I don’t know, something that makes their minds think and grow because they are going to be the future of this city, of this community, of this country, of this planet. We don’t know if the next person is going to be here in our city, so we need to focus on the education.  Kids are growing now to see something that we see regular everyday. So, again, as parents, as brothers, sister, whatever you want to call it, just think about that because this is the future of our family. And I’m a resident here, we just bought our house, we’re 2 years in our house.  We love this city. We bought our house here because we love this city. So, if that’s going to be the case, if that’s going to be happening, we might as well sell. And that’s going to be happening with a lot of people because things are going to be going down, instead of going up.

Vice Chair Alcantar asked if there were any other comments.

Good evening everyone, my name is Maria Jimenez, I’m a resident from Cudahy.  I just want to know like, what’s going to be like the next step.  So now we just have these businesses, these dispensaries, but what is going to be the next step? We don’t know, and my other question is why are we here talking about this? Not talking about bringing a nice supercenter like we have in South Gate? Why are we talking about cannabis? I respect that you people that use it, um because of their condition, but it’s really sad, in the city now. Seeing those kids in the parks, and then you know like um the people who has like kids really worried about it.  And I’m worried why? Because like one of those business is gonna be next to my house and I never was aware of that, and I don’t think that’s right.  We sold the city for $800,000? Really, when we can cut the salary of the city manager, we can cut the salary of the city attorney, so to bring that money. So, you guys are

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putting at risk our city for $800,00. Just think about it, there’s other ways.

Vice Chair Alcantar asked for additional comments and indicated they are closing the public comments.

Principal Planner McGee Ebony:  Madam chairman, just one clarifying comment. Um, the approximate $800,000 contribution is for the community benefit program only and the city will also get the operational fee of 1‐2% of gross receipts for all licenses.

Vince Sarmiento ‐ Just to go ahead and piggy back on that. A little more context, that will, over the 10 year period that most of these operators will be granted approvals on will aggregate to $9.3 million over that 10 year period. So that I do think in the staff report that you saw that their economic development ad‐hoc that was created was to study all forms of economic development.

It wasn’t just limited to cannabis, if the city decides to move forward. But um, there has been an increase in your bond rating that was just presented to your staff.  It went from a (BB) which is fairly low rating to an (A+).   A lot of it was based upon the forecasting for the new revenues that are going to be generated from cannabis.  One of the things I wanted to mention to the commission as an admonishment, that um you’ve already approved many applications that are very similar to the ones that are coming before you tonight. So, to the extent that you treat some differently than others, it invites lawsuits and challenges and to this point, you haven’t had any challenges from any of your applicants, which is very rare. For most communities that venture down this path have tons of litigation and it’s embedded in the cost. So, to the extent that you have to have reasons that are justified and that can be upheld, the applicants that are denied, will have very or similar situations as previous applicants that you have approved will have standing to file against the city. So that’s just something that we want to make sure you all know about as you deliberate. To the extent that any cost has been expended for processing, administrative fees, review, all of those that you have been borne by the applicants and not the residents here in Cudahy.  But it’s a very serious decision that you are making, and you want to make it not  of for purposes of being inconsistent.  You want to make sure that all the decisions that you  make with the previous approvals are consistent with the ones that you make for your denials.  And there has to be some very clear findings for them.
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Vice Chair ‐ Any questions from the commissioners?
_________________________
Commissioner Ortega ‐ Going back to the residents who came and provided some public comments, thank you once  again for coming out and being civically engaged. Um, moving forward, I’d definitely like to continue seeing you all at our meetings to provide input.  I think both of you had some very valid points about what you want to see in our city moving forward regarding the planning of Atlantic Blvd, so I just really want you all to continue coming.  I think that you know uh, we sit through these meeting every month with maybe one or 2 people, and the fact that we had a few residents engaging with us is really important. _________________________
Audience member ‐ How do I know when the meetings are?
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They are posted on our website, and it’s the, what is it the 3rd _________________________
Sal:  Planning commission meeting are the 3rd Monday of every month at 6 o’clock and our city council meetings are 1st and 2nd Tuesday of every month. I’m sorry 1st and 3rd Tuesday of every month, council. 3rd Monday for Planning Commission.

I have a quick question?
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Vice Chair ‐ Um, we would have to reopen the public hearing because it is closed now. Uh so I want to mention that I don’t know how my fellow commissioners will be voting tonight. Uh, but I want to mention that whether it’s a yes or no vote, again, as was mentioned earlier, there are two other opportunities.  We are a recommending body, we are not the sole decision makers. It goes to the city council so uh, whether it’s yes or no tonight. There are two other opportunities for you to voice your concerns and to change whatever vote or keep it the same. _________________________
Vince Sarmiento ‐ And just to clarify, madam chair, it’s only if the applicants decide to appeal the decision from the Planning Commission.
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Vice Chair ‐ Yes, thank you
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Vice Chair ‐ Okay, any questions for the applicants from the commissioners? _________________________
Actually, I do have some questions. Um regarding…
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Can you please step forward?
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Are these to the staff or the applicants? Ok.
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Actually, both.
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Okay.
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Commissioner Becerra ‐  I just wanted to clarify some comments made by one of the residents.

Um, there was a point made that the CEO of Hamptons Holdings from what I understand is a public official, so can you elucidate that point you made about…there’s no sort of conflict

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conducting any business in another city, while you’re a sitting official in another city right? _________________________
Vince Sarmiento ‐ Yep, there is nothing in the enabling ordinance before you that governs the regulations of cannabis in the city of Cudahy.  Nor really is there anything statewide that prevents you, a person, whether it’s an appointed person like yourselves, or an elected from holding an office or having some interest in another city.  The conflict happens when it’s in the city that you govern in. So, let’s say that you as an appointed, or one of your electeds wanted to apply here wanted to here, the conflict is clear but to the extent that any of you or any other elected do business outside of the jurisdiction that they govern in, it’s completely open. _________________________
Commissioner Becerra ‐ Yeah, I have some more questions, but I think it’s ok. I’d like the operators to present their information first.
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Sure, sure.
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Richard Polanco: Good evening, commissioners, please let me begin my comment by thanking you and acknowledging you for living in the fishbowl, and being part of the Sal:  Sir, can you state your name for the record please.

Richard Polanco: My name is Richard Polanco.

Thank you
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Ricard Polanco:  I’m a former State Senator. I had the honor of serving 16 years in the state legislature. I come before you as the chairman of the High Hamptons Holdings Company but also as someone who is very community sensitive and can understand the need and concerns that have been expressed by the residents of this community.  Let me begin again by stating that my interest when I termed out of office in 2002, we created a non‐ profit to train newly elected official’s we launched a program that dealt with the issue of enhancing our community’s presence in Sacramento through a fellowship program. I share that with you because I come from a community organizers perspective. I grew up in Los Angeles, across the street from the Maravilla Housing projects. And so, please don’t misinterpret or misperceive the real me.  The real me is about making change that is equitable so that the community is winning as well as those who come before it. Bodies like yourself that we create an opportunity that is transparent, being a public company, we are transparent. Um, we go through a very rigorous um backgrounds at all levels, and we report quarterly to the public.  So, we’re not a fly by night.  We have chosen to come to and participate in the City of Cudahy along with other investments that we have made throughout the state of California. We have made an investment in the community of West Sacramento, we have made an investment in Oakland, we have made an investment in the Coachella Valley, which is where the infamous High Hamptons began. And so, I want, and I would ask, my request would be for each and every one of you as you sit there to really look and if you

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feel that this is going to be a benefit to the community, not just in the sense of the $800,000 revenue enhancement that comes, that is earmarked for community based activities. Uh, but beyond that, we want to partner with you, we know that the cannabis medical side is not really new to California. When I served in the Legislature in 1996, the very first law that was passed by the voters was back then. As a member of the Public Safety Committee, we had this kind of discussion, where people came with the concerns that you have raised. So, my point in raising that is that really the medical side of cannabis has been around in California in statute for a very long time. What we have today is really more regulation, and if you really, to simplify the manner in which it is operating. Look at it as if an individual comes, to the city, the planning commission, being the integral part, wishing for a permit for alcohol, or for beverage related activities.  The state has now had a year of public input, the state has now created several different entities that will monitor, that will track, and that will bring the kind of transparency that is necessary to protect the public’s interest. It’s one thing to set up the operation, it’s another to ensure that that product is being consumed has been tested. So, the framework, in closing, let me say that the framework for how this new entity, this new industry.  And we look at it, I look at it from this perspective.  This is a real opportunity for creating of jobs for individuals, especially in the rural communities.  Especially in the rural communities where the wages are going to be very, very much higher and more significant than those that are currently paid.  But having said that, in this law, if there are 10 or more employees, it triggers the right of the workers to petition and ask….And so in closing, I thank you very much for the opportunity to address you and I ask for your fullest consideration for this project.  Thank you. _________________________
Kimberley Ortega ‐ I have a question for the applicant, Mr. Polanco. _________________________
Richard Polanco: Yes
Commissioner Ortega ‐ So, you mentioned, that um your business is now in West Sacramento, in the Coachella Valley, what motivated you to bring your business here to the southeast cities, or the southeast region.
_________________________
Richard Polanco:  When we, well first of all, I’m not new to this region.  I may not represent it.  But in the pasts, my roots, a lot of what impacted people across the state.  We came here because the ordinance is a fair ordinance, the ordinance allows for a process by which applicants can come and participate, it allows for an appeal process, and so the state law basically says to cities like yourself,  If you wish to initiate this opportunity, here are the minimum state standards, and if the city wishes to impose more, then you can. So, to your question, the ordinance, we are looking at other locations but certainly here, it’s in the zone you created the zone, we have the resources and finances to build it out to ensure that it happens.  We’re not a multi‐million‐dollar corporation that’s a “Cucuy”.  I still live here in LA, David Argudo, who is our CEO, of High Hamptons, who is also a member of La Puente City Council. A man whom I’ve known for over 30 years and so our heart and our real commitment is to make it work. Not just for us, but for the community as well.

Vice Chair ‐ Any questions from other Commissioners to the applicant or city staff?  So, at this

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point I’ll entertain a motion.
_________________________
David ARgudo ‐ Is there another opportunity for another member of the company can speak? _________________________
Vice Chair ‐ I would say that if we did, it would have to be through public hearing, as we would have to reopen, so unless there’s a question from the commission. _________________________
Commissioner Becerra ‐ I do have a question. What part of 420 Realty is going to be acquired through the process acquired by the larger Hampton Holdings. Could you please explain how the current management of 420 Realty will be impacted by this new acquisition program? David Argudo:  I’m sorry my name is David Argudo, I’m the CEO of Hamptons Holdings and also 420 Realty. Um, to the point of the acquisition, the acquisition took place. It’s a going to be rolled up into a publicly traded company and traded on the stock exchange.  We have moved our facilities headquarters down to the City of Industry, um, and that’s where we’re running the operations for California.  One of the issues that we face today is that under the Federal framework that we currently have is that the banking issue of raising capital. The operators are facing those challenges. One of the, one of the ways to alleviate that concern and that issue and raising is taking it to a public company. In the capital markets in Canada, we go and get the money in Canada and we bring it here to the community, then that creates economic growth. We create jobs for the residents and we are part of the Latino community, so, we’re here to enable and empower. To the point that the residents had mentioned earlier, the concerns, those are valid concerns.  You do smell marijuana down the street. We do see people smoking in my park, we do see people smoking marijuana, here at Lugo park, people are smoking.  That’s an enforcement issue. We here, at High Hamptons and 420 Realty are here to be good members of the community to participate, promote and to educate. If you look at our business plan we talk about educating our kids. Our kids need to be educated, they need to know, um, recreational, is not necessarily supported by some members of the community but medical, there is a benefit for medical. Um, you have City of Hope, Cancer Research Center is looking into the oncology side of this. You have the medical side of UCLA, USC, you have, I’ve worked with a University in Germany, Humbolt State, I’m an alumnus from there, has an Interdisciplinary for marijuana research. So on the medical side is where 420 is at.  There’s not going to be people smoking, there’s’ not going to be these recreational parties there.  It’s purely a manufacturing facility, a production facility. It’s out of sight, out of mind.  We’re not advertising, were not putting bongs, we’re not putting leaves out there.  It’s a non‐descript building. Our intentions are to help clean up the community. We’re going to have 24‐hour security.  We have multi point security cameras. One of our security compliance persons is a retired from law enforcement from California for 30 years. So, we are here to help the community.

Times up.
_________________________
David Argudo:  So, thank you for your consideration

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Thank you.
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Vincent Sarmiento ‐ Madam Chair, to commissioner Becerra’s point, on the documents, so just for all of your information, with respect to transparency, and openness, that you have all the information to deliberate on. Under Seal, we have provided to you a copy of the purchase share agreement. So, it has all the provisions that we couldn’t disclose to the public because it is a confidential document. But, it is for your ability to review as you go through and deliberate, and this has also been reflected in the development agreement. So, section 20 of the development agreement that discusses assignment, also has disclosures there that reflect this, so this wasn’t something that was being hidden. And the applicant and the staff made sure that that was clearly embedded in the development agreement. So, the public and you all can understand that in June, as the applicant mentioned there was an acquisition and a purchase of the shares. So, the applicant continues to be the same.  But, they are forced by your ordinance to make sure that they disclose if there is any ownership that changed. Your ordinance requires that if anyone has ownership of 20% or more interest in that operation, it has to be disclosed. So, they are complying with that. We have made sure that it was included in the DA.  Also, in addition to that, the applicant and the staff negotiated that the board of directors moving forward, a majority of those board of directors, controlling the interest in the operation would have to be from your local community. So that way, I know there has been policy concerns to make sure that there is local hire, there is local control, that your community members, or residents benefit from the industry.

So, we thought it was a good policy direction to be consistent with your other policy directions to make sure that your community don’t become consumers, but they do become owners and they do get lifted up by this entire industry as we move forward, so its’ a reflected of that as well. _________________________
Vice Chair Alcantar ‐ Ok, because I don’t recall that version. What is your mechanism to choose the local community members?
_________________________
Vince Sarmiento ‐ It’s going to be at the discretion of the city manager to assure that the board of directors reflects, the majority have to be from the larger LA area. Your city is relatively small, so we decided to make sure it was most of LA county that they would be drawn from, and your demographics reflect that, you know there would have to be women, and there would have to be people of color on that board because that is a reflection of your local community. _________________________
Vice Chair Alcantar ‐ And if I can ask one of the applicants, so they can discuss the mechanism for choosing the board members, and how they are deciding since it is ongoing. _________________________
Davis Argudo ‐ Absolutely, thank you. Um, so one of the, uh third point in the development agreement on page 34, it states that the board of directors LLC are selected from local communities.  Directors from outside the county of Los Angeles shall not be considered as local communities. The selection will be done, currently, as it stands we have representation on the board and the only reason we have is to start the publicly traded company. So, the representation you will have at 420 Realty will be people of color and SB 286, I believe it was that was being

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pushed, where now its sits on the governor’s board.  We’re wanting to put women’s representation. That way the input comes from the board, policies and direction of 420 Realty will come from the communities around us. Um, the way we’re going to do the selection, um basically, right now, we sit, I have myself, we have a lady by the name of Mrs. Santana, _________________________
Vice Chair Alcantar asked the applicant (Mr. Argudo) to just say first and last names of the board members if you know them.

Applicant David Argudo response:  Oh yes, um, Lupe we have um, the composition, Richard Polanco is part of the 420 Realty management, component of this and we still have 2 vacancy seats in that board.
_________________________
Vice Chair Alcantar asked a follow‐up question:  And then to add to my question, I guess when I think of working families, local communities. I don’t think all of LA County, I think the southeast LA region, I think Cudahy, so um do you, are you looking at having representation from the southeast community, not all of LA county? But southeast community on your board? And if so, are there any name you are looking at?
_________________________
David Argudo responded:

Currently we are not, but absolutely we are. And the reason why I say that is, it’s not just a filler to say yes to what you are asking, but what we, what my approach is in other communities, and when I’m seeing what’s happening with social equity components. People are being used for social equity, and they put them there as puppets. We are here, I as a policymaker, as a person enabling my community to move forward, and the Hispanic community, I look into bringing people into politics, I look to bringing people into the capital markets, I look to bringing people into the emerging markets. Yeah this is an emerging market, cannabis into the medical field.  Medical cannabis is not going to go away and one of the things that I’ve seen that has been being exploited is that our community, our Latino community is being exploited by just the get the jobs as trimmers. They’re not the operators they’re not the ones managing at the management level, and at the end of the day when your trimming flower, that is a tedious job and it’s probably the entry point for a lot of people but, I’ve looked around and I see that it’s, our members, minority groups that are getting, qualifying for those jobs. I want to be able to enable them.  And that’s one of the, that why one of these provisions is in here right?  In order to uplift and get them into management positions.
_________________________
Vice Chair asked if Mr. Argudo has spoken to UFCW and local 770 about this? _________________________
David Argudo ‐ Yes, as a matter of fact, I have participated early on, over a year ago, up in Sacramento ,in support of the union allowing people to, if you have more than 20 employees, you have the ability to negotiate in union form fashion. Yes, I have spoken to the teamsters, I have spoken to UFCW as well. Mr. Mark Ramos.
_________________________

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Vice Chair ‐ Ok, ok, thank you.
_________________________
Vince Sarmiento ‐ We just have one more contextual information.  The applicants wanted to have embedded in the language that we have here is not the language that was proposed by the applicant.  The applicant wanted to mandate that there were a majority of women and minorities as the board of directors here.  We couldn’t do that. We couldn’t allow that to happen because that would be setting a quota.  They wanted to be more aggressive while making sure that the Cudahy residents, not only participated but were part of the ownership structure but we couldn’t do that by law.  It would be challenged on the affirmative action basis.  We thought this was as close as we could get to try to ensure that your community participates in the ownership of this emerging industry.
_________________________
David Argudo ‐ If I may one last time, it is very important.  There is, there is also membership interest, for our shareholders for High Hampton, that are members from the community. They are, they are, they are, it’s part of what our intentions are and our willingness to move forward. To have local representation.  Thank you.

Vice Chair Alcantar called for last comments before entertaining a motion.

Commissioner Becerra ‐ I have a couple questions, the first one is, again I want to thank a lot of the community members. For coming out and expressing some of their concerns and uh, I can’t really refute a lot of the points that they brought up. You guys are very eloquent in expressing pretty good and valid points. One of the things that I hope that we can come to an understanding is. I think whether it’s a yes or no vote, I think it ultimately in framing the argument, there are some points raised that we’re going on sanctioning the dispensaries, and that’s just not the case.

All of these operators, and all of these development agreements are under a medicinal cannabis operation. So, it isn’t recreation. Hopefully if we can kinda get some of these points straightened out, that’s the first one.  The second one, I agree wholeheartedly with one of the points raised about distance smell. Having it recreation.  If I were one of the residents, if I lived in that location, if I smelled that every weekend, that would bother me tremendously. To the point where I would want to sell my house, so that was a very good point that you expressed. The other point is this though, that is very much an enforcement issue. It isn’t so much to me.  I just want to make the distinction, this is medicinal.  A lot of the operation for us, the basic business mode is that it’s for medicinal purposes, and I think that the benefits of that are tremendous. Again, being on a personal level, and also having researched it.  I’m not running for office, I don’t have basically a horse in the race.  I, I’m as a resident am just expressing my view. That the pros to me outweigh the cons at the end of the day.  So, with regards for instance to the smell issue, I don’t think any reasonable minded person could refute that.  But what we’re discussing here, these points and elements involved in this as a public matter, this is for medicinal purposes, so I just don’t see how voting in favor of some of these operators, that that’s going to increase the likelihood of delinquency as it relates to cannabis smoking.  So, to conclude, the framing of the argument for me is, I agree wholeheartedly, and I hope that we can get some more funding for more patrol, for more police enforcement for these kinds of things, because again, I would feel the same way, I’d be outraged frankly, if I had to smell it every weekend or every day. I don’t know how often it

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happens.  But again, this whole, when you look at this as a whole in it’s totality, and you think about all of the regulations involved, from seeds to sale, this is not just at the municipality level, this is at the County, and the State level.  This is going to be heavily regulated. And again, I’m not a big advocate, I have nothing, no interest in any of these companies, but as far as the operation and what this industry, to me it represents the elements that plague our society, primarily for instance opioid opioids crisis.  Again, about the medicinal quality of this industry would be greatly beneficial, to me again, personally, on a societal, on a larger level. So, hopefully, you know, we can come to an understanding that some of the points raised, in voting, in taking into account voting for some of these operators.  They are not coming from a place of advocating for somebody being able to pick up a joint, at the corner liquor store or anything like that.  It’s not like that at all. When you really look at the facts, there’s a lot of regulation, uh, so, I just want to make sure I kind of expressed that point before we make that decision. Uh, and hopefully addressed some of these points brought up by the residents. And in my thinking, I hope I can make a rationale for why I vote the way I do. I’m not running for office, I’m not taking anything. In fact, I’m surprised I am even here frankly. Uh, because I’m not really a public official, I’m more of a private enterprise type of person but anyways, that’s my little points, and my point about why and some of the reasons that will give me the reasons for deciding and voting the way that I do. And that’s it, thank you. _________________________
Principal Planner McGee provided additional staff comment/follow‐up:

First, I just want to point out the enforcement issue, currently the enforcement in the city is complaint driven and complaint based. It will continue to be that, um, however there isn’t a large amount of funding allocated specifically for code enforcement at this time. However, with all the commercial cannabis permits, and their development agreement, it includes ongoing enforcement and compliance. So, we have two compliance checks annually, one of those includes a joint regulatory inspection, meaning the county and the state, as well as the city and the operators are funding their own enforcement. So, if there are any violations, if we get any complaints, the investigation of those complaint, all of that is charged to the operators.  So, it’s in their best interest to be in compliance, but also the City will have funding available to do all of the enforcement necessary.  Thank you.

Vice Chair Alcantar moved to entertain a motion.
1st MOTION:  Commissioner Becerra moved the motion to approve item 7A, motion failed due to lack of a 2nd.
2nd MOTION:   Commissioner Ortega moved the motion to deny item 7B, motion seconded by Commissioner Corvera‐Hernandez which carried with the following roll call vote:

Ayes:          Commissioners Corvera‐Hernandez, Ortega and Alcantar Noes:   Becerra
Abstention:

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Absent:   Chair Fuentes
Motion approved 3‐1
C. APN 6225‐011‐006 (Walnut Street) – Consideration of Conditional Use Permit No. 38‐364 and Development Review Permit No. 41‐509 to allow the construction of a 4‐unit multi‐family residential development located at APN 6225‐011‐006 (Walnut Street) CD Manager Lopez asked the Planning Commission to continue the item to the October 15th Planning Commission Meeting.  He indicated that the applicant is not quite ready to proceed with the public hearing, the project did not pass the fire flow test, from the LA county Fire Dept per their proposal, so they need to retest it, and perhaps do some tweaking and some changes in order to make that threshold, so they are going to perform that test in the next couple weeks, so we will be ready to come back to the Planning Commission on October 15th.

Vice Chair Alcantar opened the public hearing and asked for public testimony No public comment or testimony received.

Vice Chair Alcantar called for a motion to continue the public hearing to the October 15, 2018 Planning Commission Meeting.

MOTION:   Commissioner Ortega moved the motion to continue item 7C, motion seconded by Commissioner Corvera‐Hernandez which carried with the following roll call vote:

Ayes:            Commissioners Becerra, Corvera‐Hernandez, Ortega and Alcantar Noes:

Abstention:

Absent:     Chair Fuentes
Motion approved 4‐0

8. BUSINESS SESSION
Vice chair Alcantar called for a motion to approve the following minutes:

June 19, 2017
April 30, 2018
June 25, 2018
CD Manager Lopez provided clarification for the June 25th minutes, indicating there was a typo and the attorney who was present at the meeting was Martin De Los Angeles and not Lloyd Pilchin.  The minutes have been updated to reflect the change.

Commissioners moved to approve the minutes.

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9. COMMISSION BUSINESS

Follow‐up to vice chair request on cannabis program in other cities.

Principal Planner Mc Gee provided an overview of the 18 local cities who have a cannabis program and what they offer in terms of a community benefit program, type of approved activity, and the fees and taxes that have been approved.   Ms. Mc Gee also promised to provide the matrix/chart to the Commissioners via email.

Ms. Mc Gee also provided the following update:  “Thank you manager, I just wanted to talk to you about one thing. I know we talked about the community benefit fund.  After searching through the 20 cities, with the exception of Commerce that is modelling their program after Cudahy because it’s one of the new ones on the map and Cudahy is actually in this permitting round table discussion.???? Because of the community benefit program and the process, but we are the only city that has such a robust community development, or community benefit program. Um, that is collecting the amount and allowing the benefit fund as well as operational fees, so we are unique in that sense.”
Vice Chair Alcantar asked about the status of the Clara Street Intersection Project.

CD Manager Lopez indicated that he had placed the request with the Public Works Dept. and would follow‐ up with them and report back to the Commission at the next meeting.

Vice Chair Alcantar asked for an update on the vacant lot, owned by the LAUSD in front of Park Ave. and understandsthat there were some community members and non‐profit wanting to make it into a park.  She indicated that they were working very diligently but have not seen any progress.  She would like to hear from the City Manager’s office as to the status.  Are they moving it along?  If not, why? CD Manager Lopez indicated that he would follow up with Mr. Pulido.

10. ADJOURNMENT
The commission meeting of the Cudahy Planning Commission was adjourned at 8:01 p.m. September 17, 2018 in the City Council Chambers, 5240 Santa Ana St., Cudahy, California, until October 15, 2018 to be held at 6:00 p.m. at City Council Chambers, 5240 Santa Ana Street, Cudahy, CA.

PASSED AND APPROVED, this 17thDay of September 2018

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____________________
Elizabeth Alcantar,
Vice Chairperson
ATTEST:
____________________
Salvador Lopez,
Interim Community Development Manager

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ATTACHMENT E.

Notice of Appeal dated September 28,
2018

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ATTACHMENT F.

Commercial Cannabis Permit No.18-0011

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CONDITIONS OF APPROVAL – EXHIBIT F
COMMERCIAL CANNABIS PERMIT NO, CCP18-0011
DEVELOPMENT AGREEMENT NO. DA18-011C
8210 ATLANTIC AVENUE –AQUA TERGERE, LLC

GENERAL CONDITIONS OF APPROVAL
Condition of Approval No. 1 - Financial Responsibility for Compliance Monitoring and Enforcement
a. Cost Responsibilities: The Permittee shall bear the full costs of all City staff time, materials, and City-retained consultants associated with condition compliance review and monitoring, CEQA mitigation monitoring, other permit monitoring programs, and enforcement activities, actions, and processes conducted pursuant to the City of Cudahy Municipal Code (§ 5.20.060) related to this Commercial Cannabis Permit (CCP) and Development Agreement (DA). Such condition compliance review, monitoring and enforcement activities may include (but are not limited to): periodic site inspections; preparation, review, and approval of studies and reports; review of permit conditions and related records; enforcement hearings and processes; drafting and implementing compliance agreements; and attending to the modification, suspension, or revocation of permits. Costs will be billed at the rates set forth in the Planning Division or other applicable City Fee Schedule, and at the contract rates of City-retained consultants, in effect at the time the costs are incurred.

Establishment of Compliance Account: Within 10 calendar days of the effective date of the final decision approving this CCP, the Permittee shall submit a new, updated, and completed reimbursement agreement for Condition Compliance Case No. CCP18-0011 in a form provided by the City, obligating the Permittee to pay all condition compliance review, monitoring, and enforcement costs, and any civil administrative penalties, subject to the Permittee’s right to challenge all such charges and penalties prior to payment.
b. Billing Process: The Permittee shall pay all City invoices within 30 days of receipt thereof. Failure to timely pay an invoice shall subject the Permittee to late fees and charges set forth in the City Fee Schedule, and shall be grounds for suspension, modification, or revocation of this CCP. The Permittee shall have the right to challenge any charge or penalty prior to payment.

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Condition of Approval No. 2 - Defense and Indemnification a. The Permittee shall defend, at the Permittee's sole expense with legal counsel acceptable to the City, against any and all claims, actions, or proceedings against the City, any other public agency with a governing body consisting of the members of the City Board of Supervisors, or any of their respective board members, officials, employees and agents (collectively, “Indemnified Parties”) arising out of or in any way related to the City’s issuance, administration, or enforcement of this CUP. The City shall promptly notify the Permittee of any such claim, action or proceeding and shall cooperate fully in the defense. b. The Permittee shall also indemnify and hold harmless the Indemnified Parties from and against any and all losses, damages, awards, fines, expenses, penalties, judgments, settlements, or liabilities of whatever nature, including but not limited to court costs and attorney fees (collectively, “Liabilities”), arising out of or in any way related to any claim, action or proceeding subject to subpart (a) above, regardless of how a court apportions any such Liabilities as between the Permittee, the City, and/or third parties.
c. Except with respect to claims, actions, proceedings, and Liabilities resulting from an Indemnified Party’s sole active negligence or intentional misconduct, the Permittee shall also indemnify, defend (at Permittee’s sole expense with legal counsel acceptable to City), and hold harmless the Indemnified Parties from and against any and all claims, actions, proceedings, and Liabilities arising out of, or in any way related to, the construction, maintenance, land use, or operations conducted pursuant to this CCP, regardless of how a court apportions any such Liabilities as between the Permittee, the City, and/or third parties. The City shall promptly notify the Permittee of any such claim, action, or proceeding and shall cooperate fully in the defense.
d. Neither the issuance of this CCP, nor compliance with the conditions hereof, shall relieve the Permittee from any responsibility otherwise imposed by law for damage to persons or property; nor shall the issuance of this CCP serve to impose any liability upon the Indemnified Parties for injury or damage to persons or property.

Condition of Approval No. 3 Relationship of CCP Conditions, Laws, and Other Entitlements
The Permittee shall implement the Project in compliance with all applicable requirements and enactments of federal, state, and local authorities. In the event of conflict between various requirements, the more restrictive requirements shall apply. In the event the City Manager determines that any CCP condition contained herein is in conflict with any other CPP condition contained herein, when principles of law do not

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provide to the contrary, the CCP condition most protective of public health and safety and environmental resources shall prevail to the extent feasible.

No condition of this CCP for uses allowed by the City Municipal Code shall be interpreted as permitting or requiring any violation of law, lawful rules, or regulations, or orders of an authorized governmental agency. Neither the approval of this CPP, nor compliance with the conditions of this CPP, shall relieve the Permittee from any responsibility otherwise imposed by law for damage to persons or property.

The Permittee shall obtain a business tax certificate and regulatory licenses for the operation of Commercial Cannabis operations.

Condition of Approval No. 4 - Contact Person
PURPOSE: To establish a contact person responsible for responding to City and/or community complaints.

The Permittee shall designate a contact person(s) to respond to complaints from citizens and the City which are related to the permitted uses of this CUP.

The Permittee shall provide the City with the contact information (e.g., name and/or position title, address, business and cell phone numbers, and email addresses) of the Permittee’s Community Agent who receives all orders, notices, and communications regarding matters of condition and code compliance at the Project site.

Timing: Prior to the issuance of a Zoning Clearance for use inauguration, the Permittee shall provide the Planning Division the contact information of the Permittee’s field agent(s) for the Project file. If the address or phone number of the Permittee’s field agent(s) should change, or the responsibility is assigned to another person, the Permittee shall provide Planning Division staff with the new information in writing within three calendar days of the change in the Permittee’s field agent.

The Planning Division maintains the contact information provided by the Permittee in the Project file. The Planning Division has the authority to periodically confirm the contact information consistent with the requirements of this permit.

Condition of Approval No. 5 - Resolution of Complaints
PURPOSE: To establish a process to resolve complaints.

The following process shall be used to resolve complaints related to the Project:
a. The Permittee shall post the telephone number for the designated Contact Person as identified pursuant to Condition No. 4 in a visible location on the site.

The Contact Person shall be available via telephone on a 24-hour basis.

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Persons with concerns about an activity as it is occurring may directly contact the Contact Person;
b. If City staff receives a written complaint about the Project, the City Manager, or his designee, may contact the Permittee’s Contact Person or the Permittee to request information regarding the alleged violation; and c. If, following a complaint investigation by City staff, a violation of the City Municipal Code or a condition of this CCP is confirmed, City staff may initiate enforcement actions, in accordance with City Municipal Code.

Condition of Approval No. 6 - Reporting of Major Incidents PURPOSE: To ensure that the Planning Director is notified of major incidents associated with, or resulting from, the Project, he Permittee shall immediately notify the Planning Director by telephone, email, FAX, and/or voicemail of any incidents (e.g., fires, explosions, spills, landslides, or slope failures) that could pose a hazard to life or property inside or outside the Project Site.

Upon request of any City, County or State regulatory agency, the Permittee shall provide a written report of any incident that shall include, but not limited to: a description of the facts of the incident; the corrective measures used, if any; and the steps taken to prevent a recurrence of the incident.

Timing: The Permittee shall provide the written report to the requesting agency and Planning Division within seven days of receiving the request.

The Planning Division maintains any documentation provided by the Permittee related to major incidents in the Project file.

Condition of Approval No. 7 - Change of Permittee
To ensure that the Planning Division is properly and promptly notified of any change of Permittee, the Permittee shall file, as an initial notice with the Planning Director, the new name(s), address(es), telephone/FAX number(s), and email addresses of the new owner(s), lessee(s), operator(s) of the permitted uses, and the company officer(s). The Permittee shall provide the Planning Director with a final notice once the transfer of ownership and/or operational control has occurred.

The initial notice must be submitted with the new Permittee’s contact information. The final notice of transfer must include the effective date and time of the transfer and a letter signed by the new Property Owner(s), lessee(s), and/or operator(s) of the permitted uses acknowledging and agreeing to comply with all conditions of this CCP.

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Timing: The Permittee shall provide written notice to the Planning Director 10 calendar days prior to the change of ownership or change of Permittee. The Permittee shall provide the final notice to the Planning Director within 15 calendar days of the effective date of the transfer.

The Planning Division maintains notices submitted by the Permittee in the Project file and has the authority to periodically confirm the information consistent with the requirements of this permit.

COMMERCIAL CANNABIS PRODUCTS MANUFACTURING (ORD. 673, SEC

5.20.110)
PURPOSE: The purpose and intent of this Section is to permit and regulate the commercial Cannabis Products Manufacturing to promote the health, safety, morals, and general welfare of the resident and businesses within the City. The City is authorized to regulate this activity pursuant to State Law.

Condition of Approval No. 8 - Manufacturing Operating Fees.

Operator/Permittee must pay all operating fees as stipulated within Development Agreement No. DA18-011C.

Condition of Approval No. 9 – Manufacturing Properties.

Commercial 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.

Condition of Approval No. 10 – Quality Control Employee.

The Permittee must employ at least one (1) member of its personnel dedicated full time to quality control.

Condition of Approval No. 11 – Standard Operating Procedures and Batch Record.

The Manufacturing Permittee must establish standard operating procedures and batch record that comply with current good manufacturing practices and applicable State Law, including MAUCRSA.

Condition of Approval No. 12 – Labeling and Packaging.
a) All Cannabis Products produced by a Manufacturing Permittee must be packaged in child resistant containers prior to leaving the Premises for such Manufacturing Permittee in accordance with applicable State Law, including MAUCRSA.
b) All Cannabis Products produced by a Manufacturing Permittee must be labeled in compliance with applicable State Law, including MAUCRSA. c) Labeling Requirements – Edibles

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i. 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.
ii. All items to be sold or distributed shall be individually wrapped at the original point of preparation by the Cannabis Permittee. iii. 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.
iv. 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.
v. The package must have a label warning that the product is to be kept away from children.
vi. 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. vii. Distribution must be in a properly labeled opaque package when distributed.
viii.The City Manager, or designee, may impose additional packaging and labeling requirements on Cannabis or Cannabis Products.

Condition of Approval No. 13 – Use of Solvents.
a) 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. b) 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).

Condition of Approval No. 14 – Use of Hazardous and Flammable Materials.

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 commercial 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

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(Hazardous Materials) are located on the Premises or where required by the applicable building or fire official.

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.

Condition of Approval No. 15 – Compressed Gases.

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. 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.

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

Condition of Approval No. 16 – Final Floor Plan Approval Permittee must submit to and obtain approval from the City Manager, or his designee, on all proposed Final Floor Plans. All Final Floor Plans shall be stamped and dated by the Planning Department. 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. 17 – Payment of Development Agreement Fees

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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. 18 – 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.
i. Landscape Plan – The Operator must submit a landscaping plan, designed by a licensed landscape architect or arborist. The plan must include a five-foot 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.
ii. 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.
iii. 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.
iv. LA County Public Health Permit – The Operator must submit obtain a Cannabis Public Health Permit from the Los Angeles County Public Health.
v. 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.

Condition of Approval No. 19 – 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.

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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.

Condition of Approval No. 20 – 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. 21 - 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. 22 - 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

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approved Development Agreement, the terms of the Development Agreement shall control and take precedence.

Condition of Approval No. 23. - 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 in order 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 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, as specified on the project approval letter, the Permittee must complete construction of Phase I (if applicable), 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, 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, 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.

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B Permit Life or Operations Period: This CCP will expire on September 17, 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 day prior to September 17, 2028; and
(2) The City decision-maker grants the requested modification.

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 G.

City Council Agenda
November 6, 2018

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AGENDA

A REGULAR MEETING

OF THE CUDAHY CITY COUNCIL
and JOINT MEETING of the
CITY OF CUDAHY AS SUCCESSOR AGENCY and HOUSING SUCCESSOR AGENCY

TO THE CUDAHY DEVELOPMENT COMMISSION
Tuesday, November 6, 2018 – 6:30 P.M.

Written materials distributed to the City Council within 72 hours of the City Council meeting shall be available for public inspection in the City Clerk’s Office at City Hall located at 5220 Santa Ana Street, Cudahy, CA 90201.

In compliance with the Americans with Disabilities Act (ADA) if you need special assistance to participate in this meeting, you should contact the City Clerk’s Office at (323) 773-5143 at least 72 hours in advance of the meeting.

Rules of Decorum
“Members of the Public are advised that all PAGERS, CELLULAR TELEPHONES and any OTHER COMMUNICATION DEVICES are to be turned off upon entering the City Council Chambers.” If you need to have a discussion with someone in the audience, kindly step out into the lobby.

Under the Government Code, the City Council may regulate disruptive behavior that impedes the City Council Meeting.

Disruptive conduct may include, but is not limited to:
• Screaming or yelling during another audience member’s public comments period; • Profane language directed at individuals in the meeting room; • Throwing objects at other individuals in the meeting room; • Physical or verbal altercations with other individuals in the meeting room; and • Going beyond the allotted two-minute public comment period granted.

When a person’s or group’s conduct disrupts the meeting, the Mayor or presiding officer will request that the person or group stop the disruptive behavior, and WARN the person or group that they will be asked to leave the meeting room if the behavior continues.

If the person or group refuses to stop the disruptive behavior, the Mayor or presiding officer may order the person or group to leave the meeting room, and may request that those persons be escorted from the meeting room. Any person who, without authority of law, willfully disturbs or breaks up a City Council meeting is guilty of a misdemeanor. (Pen. Code, § 403.)

CLARA STREET PARK

TURNER HALL
4835 Clara Street
Cudahy, CA 90201
Phone: (323) 773-5143
Fax: (323) 771-2072
Chris Garcia, Mayor
Christian Hernandez, Vice Mayor
Jose Gonzalez, Council Member
Cristian Markovich, Council Member
Baru Sanchez, Council Member

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It should also be noted that any person who WILLFULLY disturbs or breaks up the City Council meeting may be arrested for a misdemeanor offense. (Penal Code, § 403.)

1. CALL TO ORDER

2. ROLL CALL
Council / Agency Member Gonzalez
Council / Agency Member Markovich
Council / Agency Member Sanchez
Vice Mayor / Vice Chair Hernandez
Mayor / Chair Garcia

3. PLEDGE OF ALLEGIANCE

4. PRESENTATIONS

5. PUBLIC COMMENTS
(Each member of the public may submit one comment card if he or she wishes to address the City Council. Only speakers that submit a comment card within the first 20 minutes of the meeting will be permitted to speak for two (2) minutes concerning items under the City Council’s jurisdiction, including items on the agenda and closed session items.) (Any person who, without authority of law, willfully disturbs or breaks up a City Council meeting is guilty of a misdemeanor. (Pen. Code, § 403.))

6. CITY COUNCIL COMMENTS / REQUESTS FOR AGENDA ITEMS (Each Council Member is limited to three minutes.)
(This is the time for the City Council / Agency to comment on any topics related to “City Business,” including announcements, reflections on city / regional events, response to public comments, suggested discussion topics for future council meetings, general concerns about particular city matters, questions to the staff, and directives to the staff (subject to approval / consent of the City Council majority members present, regarding staff directives). Each Council / Agency Member will be allowed to speak for a period not to exceed three (3) minutes. Notwithstanding the foregoing, the City Council Members shall not use this comment period for serial discussions or debate between members on City business matters not properly agendized. The City Attorney shall be responsible for regulating this aspect of the proceeding.)

7. CITY MANAGER REPORT (information only)

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8. REPORTS REGARDING AD HOC, ADVISORY, STANDING, OR OTHER COMMITTEE

MEETINGS

9. WAIVER OF FULL READING OF RESOLUTIONS AND ORDINANCES (Consideration to waive full text reading of all Resolutions and Ordinances by single motion made at the start of each meeting, subject to the ability of the City Council / Agency to read the full text of selected resolutions and ordinances when the item is addressed by subsequent motion.) (COUNCIL / AGENCY)
Recommendation: Approve the Waiver of Full Reading of Resolutions and Ordinances.

10. CONSENT CALENDAR
(Items under the Consent Calendar are considered routine and will be enacted by one motion. There will be no separate discussion of these items unless a Council / Agency Member so requests, in which event the item will be removed from the Consent Calendar and considered separately.) A. Consideration to Review and Approve the Draft Minutes of October 16, 2018, for the Regular Meeting of the City Council and the Joint Meeting of the City of Cudahy as Successor Agency and Housing Successor Agency to the Cudahy Development Commission (page 9) Presented by Deputy City Clerk
Recommendation: The City Council is requested to review and approve the City Council / Agency Draft Minutes for October 16, 2018.

B. Consideration to Review and Approve the Draft Minutes of April 10, 2017, for the Regular Meeting of the City Council and the Joint Meeting of the City of Cudahy as Successor Agency and Housing Successor Agency to the Cudahy Development Commission (page 19) Presented by Deputy City Clerk
Recommendation: The City Council is requested to review and approve the City Council / Agency Draft Minutes for April 10, 2017.

C. Approval of Confidentiality Agreement between the City of Cudahy and R3 Consulting Group Inc., in the furtherance of City’s Internal Solid Waste Audit (page 27) Presented by City Attorney
Recommendation: The City Council is requested to approve a Confidentiality Agreement between the City of Cudahy and R3 Consulting Group, Inc.

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11. PUBLIC HEARING
A. A Public Hearing to Consider the Appeal of Applicant 420 Realty (Location: 4311 Santa Ana Street) of the Cudahy Planning Commission’s Denial of Commercial Cannabis Permit (CCP) No.

CCP18-0002 and Ordinance No. 696, approving Development Agreement (DA) No. DA18-002C (page 35)
Presented by Interim Community Development Manager
It is Recommended that the City Council:
a. Open the Public Hearing;
b. Receive a presentation from staff;
c. Pose questions to staff;
d. Receive comment from interested members of the public; e. Pose closing questions to staff; and
f. Close the Public Hearing and commence deliberations
If the City Council desires, it may:
a. Uphold the Planning Commission’s decision based on the record on appeal and the testimony of City staff, the applicant, and interested members of the public; or b. Overturn the Planning Commission’s decision based on the record on appeal and the testimony of City staff, the applicant, and interested members of the public, and:

1. Adopt Resolution No. 18-48, approving the issuance of Commercial Cannabis Permit No. CCP18-0002 to allow a Commercial Cannabis Facility for the Site located at 4311 Santa Ana Street;

2. Authorize the City Manager to allow a payment plan, if requested, for the Community Benefit Program as outlined in the Development Agreement (DA);

3. Allow the City Manager to select the alternative terms of payment of the Operating Fees, if requested, to begin accruing 90 days after the Effective Date of the DA rather than accrue beginning the month of the Effective Date of the DA;

4. Provide direction to City staff on whether to modify or not modify the DA to bind the operator to any future Cannabis Tax that may be imposed by the City and/or by a voter approved Cannabis Tax;

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5. Approve DA No. DA18-002C publicly noticed November 6, 2018 City Council meeting and authorize the Mayor to execute said Agreements on behalf of the City; and

6. Introduce Ordinance No. 696 by First Reading by title only, approving the DA by and between the City and 420 Realty, LLC.

B. A Public Hearing to Consider the Appeal of Applicant Aqua Tergere, LLC (Location: 8210 Atlantic Avenue) of the Cudahy Planning Commission’s Denial of Commercial Cannabis Permit (CCP) No. CCP18-0011 and Ordnance No. 697, approving Development Agreement (DA) No.

DA18-011C (page 243)
Presented by Interim Community Development Manager
It is Recommended that the City Council:
a. Open the Public Hearing;
b. Receive a presentation from staff;
c. Pose questions to staff;
d. Receive comment from interested members of the public; e. Pose closing questions to staff; and
f. Close the Public Hearing and commence deliberations
If the City Council desires, it may:
a. Uphold the Planning Commission’s decision based on the record on appeal and the testimony of City staff, the applicant, and interested members of the public; or b. Overturn the Planning Commission’s decision based on the record on appeal and the testimony of City staff, the applicant, and interested members of the public, and:

1. Adopt Resolution No. 18-49, approving the issuance of Commercial Cannabis Permit No. CCP18-0011 to allow a Commercial Cannabis Facility for the Site located at 8210 Atlantic Avenue;

2. Authorize the City Manager to allow a payment plan, if requested, for the Community Benefit Program as outlined in the Development Agreement (DA);

3. Allow the City Manager to select the alternative terms of payment of the Operating Fees, if requested, to begin accruing 90 days after the Effective Date of the DA rather than accrue beginning the month of the Effective Date of the DA;

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4. Provide direction to City staff on whether to modify or not modify the DA to bind the operator to any future Cannabis Tax that may be imposed by the City and/or by a voter approved Cannabis Tax;

5. Approve DA No. DA18-011C publicly noticed November 6, 2018 City Council meeting and authorize the Mayor to execute said Agreements on behalf of the City; and

6. Introduce Ordinance No. 697 by First Reading by title only, approving the DA by and between the City and Aqua Tergere, LLC.

12. BUSINESS SESSION
A. Adoption of Ordinance No. 694, by First Reading Adding Chapter 8.40 (“Second-Hand Smoke Control”) of Title 8 (“Health & Safety”) of the Cudahy Municipal Code (page 419) Presented by City Prosecutor
Recommendation: The City Council is requested to:

1. Introduce Ordinance No. 694, by First Reading by title only, adding Chapter 8.40 (“Second-Hand Smoke Control”) of Title 8 (“Health & Safety”) of the Cudahy Municipal Code; and

2. Waive further reading of Ordinance No. 694.

13. COUNCIL DISCUSSION – NONE

RECESS TO CLOSED SESSION
This is the time at which the City Council will meet in Closed Session to go over items of business on the closed session agenda.

14. CLOSED SESSION

CUDAHY SUCCESSOR AGENCY CLOSED SESSION ITEM
Closed Session Pursuant to Government Code Section 54956.9(d)(4) – Conference with Legal Counsel to discuss facts and circumstances that may form the basis of initiating litigation on behalf of the Successor Agency and/or City – [One (1) Matter]

RECONVENE TO OPEN SESSION

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Administrative Review Record - Aqua Tergere, LLC

ATTACHMENT H.

City Council Minutes
November 6, 2018

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MINUTES
CUDAHY CITY COUNCIL REGUAR MEETING and
CITY OF CUDAHY AS SUCCESSOR AGENCY and

HOUSING SUCCESSOR AGENCY TO THE CUDAHY

DEVELOPMENT COMMISSION JOINT MEETING
November 6, 2018 6:30 P.M.

1. CALLTOORDER
Mayor / Chair Garcia called the meeting to order at 6:32 p.m.

2. ROLL CALL
PRESENT: Council Member Gonzalez
Council / Agency Member Sanchez (left at 7:51 p.m.)
Vice Mayor / Vice Chair Hernandez
Mayor / Chair Garcia
ABSENT: Council/ Agency Member Markovich
ALSO PRESENT City Manager Jose E. Pulido, Deputy Attorney Martin de los Angeles, Deputy City Clerk Richard lglesias, and Administrative Aide, Andres Rangel.

3. PLEDGE OF ALLEGIANCE
The Pledge of Allegiance was led by Council Member Sanchez.

4. PRESENTATIONS _ NONE

5. PUBLIC COMMENTS. NONE

MAYOR GARCIA DIRECTED TO MOVE CITY COUNCIL COMMENTS TO THE END OF THE

MEETING AGENDA WITH NO OPPOSITION

6. CITY COUNCIL COMMENTS . NONE

7. CITY MANAGER REPORT (information only)

8. REPORTS REGARDING AD HOC, ADVISORY, STANDING OR OTHER COMMITTEE MEETINGS. NONE

9. WAIVER OF FULL READING OF RESOLUTIONS AND ORDINANCES Recommendation: Approve the Waiver of Full Reading of Resolutions and Ordinances.

Motion: lt was moved by Vice Mayor Hernandez, and seconded by Mayor Garcia to waive full text reading of all Resolutions and Ordinances by single motion.

City CouncillSuccessor Agency Minutes of 1116118 Pr:ge 1 ol 7

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10. CONSENT CALENDAR (ltems 10A through 10C)
COUNCIL MEMBER SANCHEZ PULLED ITEM 1OC
A. Consideration to Review and Approve the Draft Minutes of October 16, 2018, for the Regular Meeting of the City Council and the Joint Meeting of the City of Cudahy as Successor Agency and Housing Successor Agency to the Cudahy Development Commission
Presented by the Deputy City Clerk
The City Council is requested to review and approve the City Council/ Agency Draft Minutes for October 16,2018.

Motion: lt was moved by Mayor Garcia, and seconded by Vice Mayor Hernandez to review and approve the City Council / Agency Draft tt/inutes for October 16,2018. The motion carried (4-0- 1) by the following roll call vote.

AYES: Gonzalez, Sanchez, Hernandez, and Garcia
NOES: None
ABSENT: Markovich
ABSTAIN: None
B. Consideration to Review and Approve the Draft Minutes of April 10, 2017, for the Regular Meeting of the City Council and the Joint Meeting of the City of Cudahy as Successor Agency and Housing Successor Agency to the Cudahy Development Commission Presented by the Deputy City Clerk
The City Council is requested to review and approve the City Council / Agency Draft Minutes for April 10,2017.

Motion: lt was moved by Mayor Garcia, and seconded by Vice Mayor Hernandez to approve the City Council / Agency Draft Minutes forApril 10, 2017.The motion carried (4-0-1)by the following roll call vote.

AYES: Gonzalez, Sanchez, Hernandez, and Garcia
NOES: None
ABSENT: Markovich
ABSTAIN: None
C. Approval of Confidentiality Agreement between the City of Cudahy and R3 Consulting Group lnc., in the furtherance of City's lnternal Solid Waste Audit Presented by the City Attorney
The City Council is requested to approve a Confidentiality Agreement between the City of Cudahy and R3 Consulting Group, lnc.

Motion: lt was moved by Vice Mayor Hernandez, and seconded by Mayor Garcia to approve a Confidentiality Agreement between the City of Cudahy and R3 Consulting Group, lnc. The motion carried (4-0-1) by the following roll call vote.

City CouncillSuccessor Agency r\.4inules ol 13i6 18

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(
AYES: Gonzalez, Sanchez, Hernandez, and Garcia
NOES: None
ABSENT: Markovich
ABSTAIN: None
11, PUBLIC HEARING
A. A Public Hearing to Consider the Appeal of Applicant 420 Realty (Location: 4311 Santa Ana Street) of the Cudahy Planning Commission's Denial of Commercial Cannabis Permit (CCP) No. CCP18-0002 and Ordinance No. 696, approving Development Agreement (DA) No.

DA18-002C
Presented by the lnterim Community Development Manager
It is Recommended that the City Council:
a. Open the Public Hearing;
b. Receive a presentation from staff;
c. Pose questions to staff;
d. Receive comment from interested members of the public; e. Pose closing questions to staff; and
f. Close the Public Hearing and commence deliberations
lf the City Council desires, it may:
a. Uphold the Planning Commission's decision based on the record on appeal and the testimony of City staff, the applicant, and interested members of the public; or b. Overturn the Planning Commission's decision based on the record on appeal and the testimony of City staff, the applicant, and interested members of the public, and:

Adopt Resolution No. 18-48, approving the issuance of Commercial Cannabis Permit No. CCP18-0002 to allow a Commercial Cannabis Facility for the Site located at 4311 Santa Ana Street; Authorize the City Manager to allow a payment plan, if requested, for the Community Benefit Program as outlined in the Development Agreement (DA);
Allow the City Manager to select the alternative terms of payment of the Operating Fees, if requested, to begin accruing 90 days after the Effective Date of the DA rather than accrue beginning the month of the Effective Date of the DA;

4. Provide direction to City staff on whether to modify or not modify the DA to bind the operator to any future Cannabis Tax that may be imposed by the City and/or by a voter approved Cannabis Tax;
1 2
3 City CouncillSuccessor Agency Ir4inules al 1116118 Page 3 ol 7

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Approve DA No. DA18-002C publicly noticed November 6, 2018 City Council meeting and authorize the Mayor to execute said Agreements on behalf of the City; and
lntroduce Ordinance No. 696 by First Reading by title only, approving the DA by and between the City and 420 Realty, LLC.

MAYOR GARGIA OPENED PUBLIC COMMENT AT 6:45 P.M.

Sandra Gonzalez, spoke against item 114. She mentioned drugs can destroy youth lives. She went on to say residents will not benefit from the company's profits. She concluded her comments by warning of all the negative side effects cannabis has to the body, as well as focusing on other issues like rising rents.

Felix Reves. spoke against item 11A. He went on to speak against council for the excessive cannabis development approvals, as well as asking how residents are going to benefit from the profits, citing limited park and youth services.

MAYOR GARCIA CLOSED PUBLIC COMMENT AT 6:52 P.M.

Motion: lt was moved by Vice Mayor Hernandez, and seconded by Council Member Gonzalez to Consider the Appeal of Applicant 420 Realty (Location: 4311 Santa Ana Street) and overturn the Cudahy Planning Commission's Denial of Commercial Cannabis Permit (CCP) No. CCP18- 0002 and Ordinance No. 696, approving Development Agreement (DA) No. DA18-002C. The motion carried (3-1-1) by the following roll call vote.

AYES: Gonzalez, Hernandez, and Garcia
NOES: Sanchez
ABSENT: Markovich
ABSTAIN: None
B. A Public Hearing to Consider the Appeal of Applicant Aqua Tergere, LLC (Location: 8210 Atlantic Avenue) and overturn the Cudahy Planning Commission's Denial of Commercial Cannabis Permit (CCP) No. CCP18-0011 and Ordnance No.697, approving Development Agreement (DA) No. DA18-011C
Presented by the lnterim Community Development Manager
It is Recommended that the City Council:
a. Open the Public Hearing;
b. Receive a presentation from staff;
c. Pose questions to staff;
d. Receive comment from interested members of the public; e. Pose closing questions to statf; and
f. Close the Public Hearing and commence deliberations
lf the City Council desires, it may:

5. 6.

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a. Uphold the Planning Commission's decision based on the record on appeal and the testimony of City staff, the applicant, and interested members of the public; or b. Overturn the Planning Commission's decision based on the record on appeal and the testimony of City staff, the applicant, and interested members of the public, and:

1. Adopt Resolution No. 18-49, approving the issuance of Commercial Cannabis Permit No. CCP18-00'11 to allow a Commercial Cannabis Facility for the Site located at 8210 Atlantic Avenue;

2. Authorize the City Manager to allow a payment plan, if requested, for the Community Benefit Program as outlined in the Development Agreement (DA);

3. Allow the City Manager to select the alternative terms of payment of the Operating Fees, if requested, to begin accruing 90 days after the Effective Date of the DA rather than accrue beginning the month of the Effective Date of the DA;

4. Provide direction to City staff on whether to modify or not modify the DA to bind the operator to any future Cannabis Tax that may be imposed by the City and/or by a voter approved Cannabis Tax;

5. Approve DA No. DA18-011C publicly noticed November 6,2018 City Council meeting and authorize the Mayor to execute said Agreements on behalf of the City; and

6. lntroduce Ordinance No. 697 by First Reading by title only, approving the DA by and between the City and Aqua Tergere, LLC.

MAYOR GARCIA OPENED PUBLIC COMMENT AT 7:11 P.M
Sandra Gonzalez, commented that there are many desolate lots as well as deteriorating parks that need maintenance. She went on to express her concerns in regards to cannabis distribution among the youth if the item 11B is passed.
lan Boqdanoff, reminded the City's small size and how the small proximity will negatively affect residents. He also mentioned the City should do a better job advertising itself to attract more businesses, not just cannabis businesses.

MAYOR GARCIA CLOSED PUBLIC GOMMENT AT 7:16 P.M.

Motion: lt was moved by Vice Mayor Hernandez, and seconded by Council Member Gonzalez to Consider the Appeal of Applicant Aqua Tergere, LLC (Location: 8210 Atlantic Avenue) of the Cudahy Planning Commission's Denial of Commercial Cannabis Permit (CCP) No. CCP18- 0011 and Ordnance No.697, approving DevelopmentAgreement (DA) No. DA18-011C. The motion carried (3-1-1) by the following roll call vote.

AYES: Gonzalez, Hernandez, and Garcia
NOES: Sanchez
ABSENT: Markovich
ABSTAIN: None
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12. BUSINESS SESSION
A. Adoption of Ordinance No. 694, by First Reading Adding Chapter 8.40 ("Second-Hand Smoke Control") of Title 8 ("Health & Safety") of the Cudahy Municipal Code Presented by the City Prosecutor
The City Council is requested to

1. lntroduce Ordinance No. 694, by First Reading by title only, adding Chapter

8.40 ("Second-Hand Smoke Control") of Title 8 ("Health & Safety") of the Cudahy Municipal Code; and

2. Waive further reading of Ordinance No. 694
Motion: lt was moved by Vice Mayor Hernandez and seconded by Mayor Garcia to introduce Ordinance No. 694, and waive it for further reading. The motion carried (4-0-1) by the following rollcallvote.

AYES:

NOES:

ABSENT:

ABSTAIN
Gonzalez, Sanchez, Hernandez, and Garcia
None
Markovich
None

13. COUNCIL DISCUSSION - NONE

RECESS TO CLOSED SESSION
City Attorney, Martin de los Angeles recessed the meeting to close session at 7:35 p.m.

14. CLOSED SESSION

CUDAHY SUCCESSOR AGENCY CLOSED SESSION ITEM
Closed Session Pursuant to Government Code Section 54956.9(d)(4) - Conference with Legal Counsel to discuss facts and circumstances that may form the basis of initiating litigation on behalf of the Successor Agency and/or City - [One (1) Matter]

RECONVENE TO OPEN SESSION
CityAttorney Martin de los Angeles reconvened the Regular Meeting in Open Session al7:57 p.m.

15. CLOSED SESSION ANNOUNCEMENT
City Attorney Martin de los Angeles announced that with respect to item 14, direction was given, but no final action was taken.

16. ADJOURNMENT
The City Council / Agency meeting was adjourned at 7:58 p.m.

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Chris Garcia
Mayor
ATTEST:

Deputy City
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ATTACHMENT I.

City Council Staff Report
November 6, 2018

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STAFF REPORT
Date: November 6, 2018
To: Honorable Mayor/Chair and City Council/Agency Members From: Jose E. Pulido, City Manager/Executive Director
By: Ebony J. McGee Andersen, Economic Development Principal Planner Salvador Lopez Jr., Interim Community Development Manager Subject: A Public Hearing to Consider the Appeal of Applicant Aqua Tergere, LLC (Location: 8210 Atlantic Avenue) of the Cudahy Planning Commission’s Denial of Commercial Cannabis Permit (CCP) No. CCP18-0011 and Ordnance No. 697, approving Development Agreement (DA) No. DA18-011C

RECOMMENDATION
It is Recommended that the City Council:
a. Open the Public Hearing;
b. Receive a presentation from staff;
c. Pose questions to staff;
d. Receive comment from interested members of the public; e. Pose closing questions to staff; and
f. Close the Public Hearing and commence deliberations
If the City Council desires, it may:
a. Uphold the Planning Commission’s decision based on the record on appeal and the testimony of City staff, the applicant, and interested members of the public; or Item Number
11B

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b. Overturn the Planning Commission’s decision based on the record on appeal and the testimony of City staff, the applicant, and interested members of the public, and:

1. Adopt Resolution No. 18-49, approving the issuance of Commercial Cannabis Permit No. CCP18-0011 to allow a Commercial Cannabis Facility for the Site located at 8210 Atlantic Avenue;

2. Authorize the City Manager to allow a payment plan, if requested, for the Community Benefit Program as outlined in the Development Agreement (DA);

3. Allow the City Manager to select the alternative terms of payment of the Operating Fees, if requested, to begin accruing 90 days after the Effective Date of the DA rather than accrue beginning the month of the Effective Date of the DA;

4. Provide direction to City staff on whether to modify or not modify the DA to bind the operator to any future Cannabis Tax that may be imposed by the City and/or by a voter approved Cannabis Tax;

5. Approve DA No. DA18-011C publicly noticed November 6, 2018 City Council meeting and authorize the Mayor to execute said Agreements on behalf of the City; and

6. Introduce Ordinance No. 697 by First Reading by title only, approving the DA by and between the City and Aqua Tergere, LLC.

BACKGROUND

1. 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.”

2. 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

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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.

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 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.

3. On February 1, 2012, California Governor Brown dissolved the redevelopment areas in cities statewide thereby negating $3 million annually in funds to the Cudahy Community Development Commission (CDC).

4. On July 12, 2014, the City Council held a Special Meeting to prepare a draft strategic plan (Attachment A) which among other things identified the need to establish an economic development plan, develop consistent revenue generators, implement a business retention program, and above all use these various tools to adopt a balanced budget.

5. On August 11, 2014, the City Council entered into an Employment Agreement with Jose E.

Pulido for the City Manager position.

6. On August 10, 2015, the City Council approved the addition of an Economic Development Ordinance No. 652 with the goal of providing the City with an economic development venue to implement its General and Strategic Plan.

7. In September 2015, the California State Legislature enacted, and Governor Brown signed

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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.

8. On October 26, 2015, the City Council approved Ordinance No. 653 to amend the municipal code to provide investment and development opportunities in our depilated and underutilized industrial zones through a Development Agreement (DA).

9. On August 22, 2016, the City Council 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.

The MMRSA was renamed the Medical Cannabis Regulation and Safety Act (the “MCRSA”) under Senate Bill 837 in June 2016, which also included substantive changes to the applicable state laws, which affect the various state agencies involved in regulating cannabis businesses as well as potential licensees.

10. 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.

11. 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.

AUMA also created a state regulatory and licensing system governing the commercial cultivation, testing, and distribution of nonmedical cannabis, and the manufacturing of nonmedical cannabis products.

12. 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.

13. 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

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consolidated provisions under SB 94 are 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.”

14. On June 27, 2017, as part of an Economic Development Ad Hoc Committee presentation on City Council opportunities, commercial cannabis regulations and strategies were discussed by the City Council. Based upon such discussion and direction from the City Council, the City sought to establish an overlay zone in the City in which certain medicinalonly commercial cannabis activities could be conducted in accordance with MAUCRSA and the City’s police power under Section 7 of Article XI of the California Constitution.

15. On July 31, 2017, the Cudahy Planning Commission adopted Planning Commission Resolution No. 17-03, which: (1) found that the proposed Ordinance No. 673 is consistent with the General Plan and compliant with CEQA; and (2) recommended City Council approval of the proposed Ordinance No. 673.

16. At its meeting of August 24, 2017, the City Council approved Ordinance No. 673 for First Reading.

17. On September 11, 2017, the City Council held a Second Reading of Ordinance No. 673.

18. On September 25, 2017, the City entered into Professional Services Agreements (PSA) with Vincent Sarmiento and Glenn Ward Calsada for cannabis legal counsel; MGO for technical consultation, economic projection and application screening and review; and emja Planning + Development, for policy development, permit processing, project management and on-going compliance enforcement services in connection with the City’s Cannabis Program.

19. On September 21, 2017, an amendment to the City’s fee schedule, was approved and adopted by City Council.

20. On December 4, 2017, the Commercial Cannabis Permit applications were initially due to the City, after a 45-day application period. However, due to technical difficulties with the online application program, the City Manager extended the application submission deadline to December 15, 2017.

21. On December 15, 2017, the City received 41 applications for commercial cannabis license types were received by the City, including those for cultivation, manufacturing, retail delivery, distribution and testing.

22. By February 1, 2018, the City received reimbursement agreements from applicants to ensure all staff and consultant time, including permit processing, monitoring and compliance costs, will be reimbursed to the City by the applicant.

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23. On March 20, 2018, the City Council approved a General Plan Update (General Plan 2040) which established new Zoning Districts.

24. On July 17, 2018, The City Council adopted the Zoning Code Amendment which formally established the new zoning districts and uses therein. As a result, the existing Commercial Manufacturing (CM) zone became a Light Industrial (LI) Subdistrict, which is consistent with the General Plan Land Use Designation.

25. To date, the City has processed 14 Development Agreements and 7 Commercial Cannabis Permits applications submitted by applicants, in accordance with City Ordinance No. 673.

26. On September 7, 2018, the Planning Department and City Clerk’s Office provided public notice regarding to the Planning Commission hearing on this matter in accordance with the requirements of Government Code §65091 and the City Municipal Code. The Planning Division mailed notices to all owners of property within 300 feet of the project site and placed a legal ad in the Press Telegram.

27. On September 17, 2018, at a duly noticed public hearing, the Planning Commission considered an application for Commercial Cannabis Permit (“CCP”), [CCP18-0011], and Development Agreement (“DA”) [DA18-011C], respectively, submitted by Aqua Tergere, LLC ("Applicant"). A staff presentation was made, and public testimony was heard. A summary of the hearing (Attachment B) has been prepared and is now part of the permanent file of the case.

By majority vote of the members present, the Planning Commission decided not to recommend CCP18-011 and DA18-011C to the City Council.

28. On October 1, 2018, the Applicants herein submitted their written Notice of Appeal (Attachment A) to the Clerk of the Council, pursuant to Section 20.84.160 of the Cudahy Zoning Code. The Applicants/Appellants claim the Planning Commission “failed to articulate findings and provide supporting evidence identifying specifics in the record that are the reason for the denial.”
The Appeal of the denial of the CCP, having been timely filed, accompanied by the required processing fee, and reciting the grounds for appeal of the determination, is now properly before the City Council for de novo consideration. As a result, the City Council has the authority to reverse, modify, or affirm the underlying Planning Commission decision in whole or in part based on the evidence presented.

Notwithstanding the Planning Commission's recommendation of disapproval of the DA, the City Council may approve the DA provided that the DA meets the minimum requirements under state law for approval by ordinance and the City Council finds that its