1 Beavers, Esther
From:David G. Lim
Sent:Monday, March 10, 2025 9:54 PM
To:Beavers, Esther
Cc:Rees, Karen
Subject:FW: City Council Supplement - Additional Authority Against Resolution Follow Up Flag:Follow up
Flag Status:Flagged
Hi Esther,
Can you please save the email below to the online comments for the Authen Ɵc maƩer for March 18 City Council meeƟng? Thank you!
David G. Lim (He/Him/His)
Fairfield City Attorney
RICHARDS WATSON GERSHON
One Sansome Street, Suite 2850
San Francisco, California 94104
T: 415.421.8484
E: [email protected]
W: rwglaw.com
From: Phillis, Nicole
Sent: Tuesday, March 4, 2025 3:45 PM
To: David G. Lim ; Zellers, David
Subject: City Council Supplement - Additional Authority Against Resolution
Dear Mr. Lim and Mr. Zellers,
In reviewing the staƯ report and proposed resolution, Authentic Fairfield, LLC (“Authentic”) has one additional argument against rescission that we would like to add to our submission to City Council. We request that this information be passed along to the Councilmembers as soon as possible.
Both of the Fairfield Municipal Code (“FMC”) sections relied upon in the proposed resolution (FMC 10E.14, 10E.15) apply to “permittees” and not preliminary approval holders. The Code expressly defines preliminary approval as “an entity that has an approved application for a Commercial cannabis permit but has not yet completed all the requirements to receive the regulatory permit (Commercial Cannabis Business Permit) issued by the City pursuant to this Chapter.(Ord. No. 2020-07, § 1; Ord. No 2024-08, §§ 2, 3.)” (FMC 10E.5(aa).) Thus on its face,
2 sections 10E.14 and 10E.15 do not apply because they only apply to permittees and not preliminary approval holders.
Because Authentic is a preliminary approval holder, it is not yet a “permittee” for the purposes of the FMC and therefore the provisions cited in the proposed resolution 2025-37 do not apply to Authentic.
Please see relevant highlights below:
10E.14 Changes in Business Location or Permit Information.
A commercial cannabis business permit is nontransferable to another location and may not otherwise be modified, except in accordance with this section. Failure to comply with this section is grounds for permit revocation.
(a) At least 60 calendar days prior to an anticipated change to the location of the cannabis business, the permittee shall file a new application form with the City Manager, including a Zoning Verification Letter for the new location. The City Manager will hold an administrative public hearing to determine whether to approve or deny the change in location.
(b) The permittee shall file an updated application form with the City Manager at least 30 calendar days prior to an anticipated change to any other information listed in the permit application, including but not limited to a change in contact information, change in trade name, or change in the security plan; provided, however, that a change in ownership shall comply with Section 10E.15.
…
10E.15 Transfer of a Preliminary Approval or a Cannabis Business Permit.
A commercial cannabis business permit is nontransferable to any other person except in accordance with this section. Any attempt to transfer a commercial cannabis business permit without complying with this section shall be deemed void and is grounds for permit revocation.
(a) Prior to any transfer or change in ownership of a commercial cannabis business permit, the permittee shall file a new application with the City Manager. The application shall be accompanied by a transfer fee in an amount set by resolution of the City Council (or if not set, shall be the same amount as an application fee).
(b) The City Manager shall review the application to determine whether the new owner(s) meet the minimum permit eligibility criteria. If the transfer involves a substantial change in ownership, the City Council shall hold a public hearing and approve or deny the transfer pursuant to the procedures for approval of a new permit application. A "substantial change in ownership" shall mean any change in the permittee’s business structure or ownership of the business entity that results in a change of more than 51% of the original ownership. A transferred permit shall be valid for a period of one year from the date of the City Council’s approval.
(c) Notwithstanding the above, a permittee may change the form of business entity without applying for a permit transfer in either of the following scenarios; provided, that the permittee notifies the City Manager in writing of the change within 10 days of the date the change takes eƯect:
(1) The ownership of the new business entity is substantially similar to original permittee business entity (at least 51% of the ownership is identical); or
(2) If the original permittee is an unincorporated association, mutual or public benefit corporation, agricultural or consumer cooperative corporation and subsequently transitions to or forms a new business entity as allowed under MAUCRSA; provided, that the Board of Directors (or in the case of an unincorporated association, the individual(s) listed on the City permit application) of the original permittee entity are the same as the new business entity.
3 …
Thank you for your consideration and I appreciate your passing this along to the Council.
Sincerely,
Nicole
Nicole Phillis
Partner | Davis Wright Tremaine LLP
P 213.633.8657 C 323.401.0474 E [email protected] A 350 South Grand Avenue, 27th Floor, Los Angeles, CA 90071 DWT.COM