Agenda Packet — Hayward City Council, December 16, 2025 (part 3 of 4)

DATE: December 16, 2025
TO: Mayor and City Council
FROM: City Manager
SUBJECT: Adopt a Resolution: (1) Declaring a City Council Recess from December 22, 2025 through January 2, 2026; (2) Cancelling the Regular City Council Meetings Scheduled for December 23, 2025, and January 6, 2026; and (3) Authorizing the City Manager, or their Designee, to take Action on Administrative Matters as Necessary During the Recess

RECOMMENDATION
That the City Council adopts a resolution (Attachment II): (1) Declaring a City Council recess from December 22, 2025 through January 2, 2026 (“winter recess”); (2) Cancelling the regular City Council Meetings scheduled for December 23, 2025, and January 6, 2026; and (3) Authorizing the City Manager, or their Designee, to take action on administrative matters as necessary during the recess.

BACKGROUND/DISCUSSION
Staff recommends declaration of a City Council recess from December 22, 2025 through January 2, 2026 to allow the council members’ time to rejuvenate and spend time with family and loved ones during the winter holiday period. In order to facilitate the winter recess, the regular City Council meetings currently scheduled for December 23, 2025, and January 6, 2026, must be cancelled. The cancellation does not preclude the Mayor from calling a special or emergency meeting during the recess if necessary. Any meetings scheduled during the recess will comply with Brown Act noticing requirements.

Although the City Council will be taking a winter recess, there may still be matters that require administrative action in a timely manner, which cannot be deferred until after the winter recess. Staff requests that the City Council authorize the City Manager, or their designee, to take action on administrative matters as necessary during the recess. This would involve authority to execute documents, such as contracts, and authority to submit or file documents, that would normally require City Council action. Following the winter recess, the City Manager or their designee will report to the City Council any administrative approvals made during the recess.

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FISCAL IMPACT
The recommendations provided herein will have no fiscal impact.

NEXT STEPS
Upon adoption of the Resolution, the City Council will recess from December 22, 2025 through January 2, 2026. The City Manager or their designee will have the authority to take action on administrative matters during the winter recess and will report back to the City Council when it reconvenes at the first regular City Council meeting following the recess, tentatively scheduled for January 20, 2026.

Prepared by: Michael Lawson, City Attorney
Recommended by: Jennifer Ott, City Manager
Approved by:
______________________________________
Jennifer Ott, City Manager

HAYWARD CITY COUNCIL
RESOLUTION NO. 25-___
Introduced by Council Member _________

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HAYWARD DECLARING A CITY COUNCIL RECESS FROM DECEMBER 22, 2025 THROUGH JANUARY 2, 2026; CANCELLING THE REGULAR CITY COUNCIL MEETING SCHEDULED FOR DECEMBER 23, 2025; AND AUTHORIZING THE CITY MANAGER, OR THEIR

DESIGNEE, TO TAKE ACTION ONADMINISTRATIVE MATTERS AS NECESSARY

DURING THE RECESS
WHEREAS, staff recommends a winter recess be declared from December 22, 2025 through January 2, 2026, (“Winter Recess”) to allow councilmembers time to rejuvenate and spend time with family and loved ones during the winter holiday period; and WHEREAS, the City Council typically holds regular meetings on the first, third and fourth Tuesdays of each month; and
WHEREAS, in order to facilitate the Winter Recess, the regular Hayward City Council meeting currently scheduled for December 23, 2025 must be cancelled; and WHEREAS, during the Winter Recess, certain administrative matters that typically require City Council approval may require action which cannot be deferred until after the Winter Recess; and
WHEREAS, the City Manager or their designee may be authorized by the City Council to take action on administrative matters involving execution, submission, or filing of documents, as necessary during the Winter Recess.

NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Hayward, California, that the City Council hereby declares that it shall be on recess from December 22, 2025 through January 2, 2026
BE IT FURTHER RESOLVED, that the regular City Council meeting currently scheduled for December 23, 2025 is hereby cancelled.

BE IT FURTHER RESOLVED, that the City Council hereby authorizes the City Manager or their designee, to take action on administrative matters requiring execution, submission, or filing of documents during the City Council’s Winter Recess which cannot be deferred until the next regularly scheduled City Council meeting.

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BE IT FURTHER RESOLVED, that all actions taken by the City Manager or their designee pursuant to this resolution shall be reported to the City Council at the first regular City Council meeting following the Winter Recess.

IN COUNCIL, HAYWARD, CALIFORNIA, _______________________, 2025 ADOPTED BY THE FOLLOWING VOTE:

AYES: COUNCIL MEMBERS:

MAYOR:

NOES: COUNCIL MEMBERS:

ABSTAIN: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:

ATTEST: ______________________________________
City Clerk of the City of Hayward
APPROVED AS TO FORM:
_________________________________________
City Attorney of the City of Hayward
CITY OF HAYWARD Hayward City Hall
777 B Street
Hayward, CA 94541
www.Hayward-CA.gov
File #: CONS 25-569
DATE: December 16, 2025
TO: Mayor and City Council
FROM: Director of Human Resources

SUBJECT
Adopt a Resolution Approving Side Letter of Agreements Amending Memoranda of Understanding between the City of Hayward and Both the International Association of Firefighters, Local 1909 and Hayward Fire Officers Association and Authorizing Staff to Execute the Agreement

RECOMMENDATION
That the City Council adopts a Resolution (Attachment II) approving two Side Letters of Agreement amending the Memoranda of Understanding between the City of Hayward and both the International Association of Firefighters, Local 1909 and Hayward Fire Officers Association (HFOA) and authorizing staff to execute the agreement.

SUMMARY
The City of Hayward is facing a budget deficit and is taking measures to reduce costs to rebuild the target reserve. As a result, the City has taken a number of cost-saving measures to limit the impact this has on its employees and residents, such as reducing expenditures, holding and freezing vacant positions, and seeking concessions from its organized employee groups.

The City has met and conferred in good faith with Local 1909 and the HFOA, and members of the Union and Association have agreed to cost saving measures over calendar year 2026. These measures will provide a savings of $3.1 million in FY 2025-2026, and a savings of $2.9 million in FY 2026-2027. The Union has agreed to enter discussions with the possibility of continuing the savings into future calendar years after meeting and reviewing the City’s financial situation.

In addition, the Union and the City have agreed to corrections to existing contract language that align with compliance with the California Public Employee Retirement System (CalPERS). These changes reflect the intention of pensionable contributions for certain pays and have no immediate additional fiscal impact.

ATTACHMENTS
CITY OF HAYWARD Page 1 of 2 Printed on 12/12/2025
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File #: CONS 25-569
Attachment I Staff Report
Attachment II Resolution
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DATE: December 16, 2025
TO: Mayor and City Council
FROM: Director of Human Resources
SUBJECT: Adopt a Resolution Approving Side Letter of Agreements Amending Memoranda of Understanding between the City of Hayward and Both the International Association of Firefighters, Local 1909 and Hayward Fire Officers Association and Authorizing Staff to Execute the Agreement

The City has met and conferred in good faith with Local 1909 and the HFOA, and members of the Union and Association have agreed to cost saving measures over calendar year 2026.

These measures will provide a savings of $3.1 million in FY 2025-2026, and a savings of $2.9 million in FY 2026-2027. The Union has agreed to enter discussions with the possibility of continuing the savings into future calendar years after meeting and reviewing the City’s financial situation.

FISCAL IMPACT
If approved, the proposed Side Letter of Agreements with Fire would result in a projected General Fund savings of approximately $3.1 million in FY 2025/26 and $2.9 million in FY

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2026/27, for a combined savings of $6 million in calendar year 2026. The Side Letter also adds costs to the City of roughly $1 million over two calendar years in 2028 and 2029.

Of the savings for FY 2026/27, $2 million of savings results from reductions in minimum staffing which will reduce overtime in the department. This $2 million will reduce the budget deficit of $26.7 million by $2 million. The remaining savings of $1.1 million is from a deferred salary increase and benefits the City’s FY 2025/26 budget by that amount. Staff had not included the salary increase in the November revised budget, so the $1.1 million does not impact the deficit staff shared at that meeting.

BACKGROUND
In response to the City’s current financial state, the City has implemented a number of cost saving measures, including but not limited to: identification of one-time savings and funding sources; holding vacancies while working towards instituting an official hiring freeze; limiting training costs and use of consultants; increased frequency of monitoring of cash flow to weekly; increased frequency of monitoring payroll expenditures to bi-weekly; regularly reviewing ideas for balancing the budget from staff; and continued review and reduction of temporary staff.

In addition, all bargaining groups in the City were asked for a concession equivalent to three and one-half percent (3.5%) of each respective bargaining unit’s annual salary costs.

Cost savings contributed by bargaining groups are critical to the City’s fiscal health as employee salaries and benefits costs make up approximately 80% of the General Fund budget.

DISCUSSION
In helping the City realize cost saving measures, Local 1909 and HFOA have agreed to delay the three and eighty-two hundredths (3.82%) increase due to their memberships the pay period containing January 1, 2026. Instead, the Unions will take a partial increase at the start of Fiscal Year 2026-2027 of one and one-half percent (1.5%) and delay the remaining (2.32%) to the end of the calendar year. In addition, the Unions agreed to temporarily modify minimum staffing coverage by a total temporary reduction of five (5) through browning-out service companies; and to temporarily increase the employer-paid portion to CalPERs by an additional two percent (2%) effective approximately July 1, 2026. In return, effective January 1, 2028, the number of employees that may simultaneously use vacation will increase by one (1); and sick leave accrual rates will increase aligned with employees’ years of service. All agreed upon temporary changes are outlined in the table below.

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Table 1: Key Proposed Changes
MOU Section Summary of Temporary Update –
provisions revert/expire December 31,
2026 (or the pay period containing unless
otherwise noted).

Effective Dates
(as aligned with
applicable pay
periods)

4.05 Minimum
Staffing
Minimum daily staffing reduction to thirtythree (33) personnel with a combined total of eleven (11) companies, reflecting the
temporary brownouts.

After Adoption –
December 31,
2026

6.01 Retirement Plan Increase total employee CalPERS contribution from 15% to 17%.

July 1, 2026 –
December 31,
2026

7.12 Salaries No increase (deferral to later date) January 1, 2026

1.5% (partial increase from January 1, 2026) July 1, 2026

2.32 (remaining deferral amount from January
1, 2026)
December 31,
2026

9.04 Scheduling
Vacation
Increase number of employees from five (5) to
six (6) that may use vacation simultaneously.

January 1, 2028

10.03 Sick Leave
Allowance
Increase vacation accrual rates as follows:

For forty (40) hour employees
 Employees with Zero (0) to fifteen (15)
years of service shall accrue four and ninetyfour hundredths (4.94) hours of sick leave credit per payroll period.
 Employees with more than fifteen (15) years
of service shall accrue five and ninety-four
hundredths (5.94) hours of sick leave credit
per payroll period.

For fifty-six (56) hour employees
 Employees with Zero (0) to fifteen (15)
years of service shall accrue six and ninetytwo hundredths (6.92) hours of sick leave credit per payroll period.
 Employees with more than fifteen (15) years
of service shall accrue eight and thirty-one
hundredths (8.31) hours of sick leave credit
per payroll period.

January 1, 2028

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In addition to the agreements summarized above, the City and the Union have agreed to amend the MOU provision for Special Assignment Pay that brings the mutual intention of reportable pension pay into compliance with CalPERS regulations. This item is cost neutral as proposed changes resolve a reporting compliance matter.

STRATEGIC INITIATIVES
This agenda item is a routine operational item and does not relate to one of the Council’s Strategic Initiatives.

NEXT STEPS
Staff will finalize the side letter agreements and obtain necessary review by the City Attorney and approval by the City Manager to execute them. The Human Resources Department will work with the Finance Department to implement these changes.

Prepared by: Ian Tecson, Director of Human Resources
Approved by:

Jennifer Ott, City Manager

ATTACHMENT II
1 HAYWARD CITY COUNCIL
RESOLUTION NO. 25-_____
Introduced by Council Member ______

RESOLUTION APPROVING TWO SIDE LETTERS OF AGREEMENT WITH THE

HAYWARD FIREFIGHTERS AND THE HAYWARD FIRE OFFICERS

ASSOCIATION REPRESENTED BY INTERNATIONAL ASSOCIATION OF FIREFIGHTERS – LOCAL 1909 TO AMEND THE CURRENT MEMORANDA OF

UNDERSTANDING
WHEREAS, the City of Hayward is facing a budget deficit and is taking measures to reduce costs to rebuild the target reserve; and
WHEREAS, the City of Hayward must realize cost saving measures for the current fiscal year 2025-2026; and
WHEREAS, members of the Hayward Firefighters, Hayward Fire Officers Association represented by International Association of Firefighters – Local 1909 and have met and conferred with the City and have reached agreement; and WHEREAS, the parties agree to temporary changes to the respective MOUs in calendar year 2026 that help the City address the current budget deficit, including a temporary reduction in minimum staffing, temporary increase in employe-paid contributions to CalPERS, and temporary salary deferrals; and WHEREAS, the parties also agree to increase sick leave accrual and the number of employees that can take vacation simultaneously; and
WHEREAS, the agreed upon changes represent a projected savings of $6 million to the general fund for calendar year 2026; and
WHERAS, the parties agree to amend language related to special assignment pays to comply with CalPERS reportable pay; and
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Hayward that the City Manager is hereby authorized and directed to execute, on behalf of the City of Hayward, amendments to the Memoranda of Understanding through the related side letters of agreement as soon as administratively possible, and authorizes staff to execute said agreements, a copy of which will be on file in the Office of the City Clerk .

ATTACHMENT II
2 IN COUNCIL, HAYWARD, CALIFORNIA _______________________, 2025 ADOPTED BY THE FOLLOWING VOTE:

AYES: COUNCIL MEMBERS:

MAYOR:

NOES: COUNCIL MEMBERS:

ABSTAIN: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:

ATTEST: ________________________________________
City Clerk of the City of Hayward
APPROVED AS TO FORM:
___________________________________________
City Attorney of the City of Hayward
CITY OF HAYWARD Hayward City Hall
777 B Street
Hayward, CA 94541
www.Hayward-CA.gov
File #: WS 25-042
DATE: December 16, 2025
TO: Mayor and City Council
FROM: City Manager

SUBJECT
City Budget Status Update: Oral Report by the City Manager as Information Becomes Available (Oral Report from City Manager Ott)
CITY OF HAYWARD Page 1 of 1 Printed on 12/12/2025
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CITY OF HAYWARD Hayward City Hall
777 B Street
Hayward, CA 94541
www.Hayward-CA.gov
File #: PH 25-049
DATE: December 16, 2025
TO: Mayor and City Council
FROM: Development Services Director

SUBJECT
Phenos Hayward: Proposal to Operate a Commercial Cannabis Retail Dispensary in a 14,928-Square-Foot Tenant Space at 21463 Foothill Boulevard (Assessor Parcel No. 414-0086-056-02) in the General Commercial (CG) Zoning District, Requiring Approval of Conditional Use Permit Application No. UP-25- 0011 and a Finding that the Project is Categorically Exempt from the Provisions of the California Environmental Quality Act (CEQA) Pursuant to Section 15301 of the CEQA Guidelines.

Applicants/Operators: Esther Lopez and Angilbert Sarkis, Gream Enterprises, Inc. [DBA Phenos Hayward]; Property Owner: Foothill-Grove LLC.

RECOMMENDATION
That the City Council consider the Planning Commission’s September 25, 2025 recommendation to deny the Conditional Use Permit (CUP) and adopt a resolution approving the CUP subject to the conditions set forth in the resolution and finding the project to be categorically exempt from CEQA pursuant to CEQA Guidelines Section 15301.

SUMMARY
The applicant is requesting approval of a CUP to operate a Commercial Cannabis Retail Dispensary in a vacant, 14,928-square-foot tenant space previously occupied by a Walgreens drugstore at 21463 Foothill Boulevard. The dispensary would be open seven days a week from 9:00 AM to 8:00 PM and would offer cannabis and cannabis-based products to customers 21 years of age and older for recreational use, and 18 years of age and older for medicinal use, as allowed under State law. The project includes a robust security plan which includes the presence of two professionally licensed security guards on the premises during all business hours that has been reviewed and approved by the Hayward Police Department, which the applicant will be required to implement and adhere to at all times, and would include minor alterations to the interior and exterior of the subject tenant space.

One of the two co-applicants, Esther Lopez, was one of three operators selected by the City Council to operate a retail cannabis dispensary in 2018 and has been looking for a suitable location for several years. Ms. Lopez obtained previous approval of a CUP to operate a retail dispensary at 1147 B Street in 2020, but difficulties related to leasing arose between her and the owner of that property which were unable to be resolved, and the CUP ultimately expired. The Planning Commission considered her and her CITY OF HAYWARD Page 1 of 2 Printed on 12/12/2025
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File #: PH 25-049
unable to be resolved, and the CUP ultimately expired. The Planning Commission considered her and her business partner’s request for the CUP at the subject location on September 25, 2025, and, after a lengthy public hearing in which several members of the public spoke, voted 5-1 to recommend denial to the Council.

ATTACHMENTS
Attachment I Staff Report
Attachment II Draft Resolution for Approval
Attachment III Business & Operations Plan
Attachment IV Proposed Plans
Attachment V Correspondence in Opposition
Attachment VI Correspondence in Support
Attachment VII Applicants’ Response to Planning Commission Concerns CITY OF HAYWARD Page 2 of 2 Printed on 12/12/2025
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Attachment I

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DATE: December 16, 2025
TO: Mayor and City Council
FROM: Development Services Director Sara Buizer
SUBJECT: Phenos Hayward - Proposal to Operate a Commercial Cannabis Retail Dispensary in a 14,928-Square-Foot Tenant Space at 21463 Foothill Boulevard (Assessor Parcel No. 414-0086-056-02) in the General Commercial (CG) Zoning District, Requiring Approval of Conditional Use Permit Application No. UP-25- 0011 and a Finding that the Project is Categorically Exempt from the Provisions of the California Environmental Quality Act (CEQA) Pursuant to Section 15301 of the CEQA Guidelines. Applicants/Operators: Esther Lopez and Angilbert Sarkis, Gream Enterprises, Inc. [DBA Phenos Hayward]; Property Owner:

Foothill-Grove LLC.

RECOMMENDATION
That the City Council consider the Planning Commission’s September 25, 2025 recommendation, and adopt a resolution (Attachment II) approving the Conditional Use Permit (CUP) subject to the conditions set forth in the resolution and finding the project to be categorically exempt from CEQA pursuant to CEQA Guidelines Section 15301.

SUMMARY
The applicants are requesting approval of a CUP to operate a Commercial Cannabis Retail Dispensary in a vacant, 14,928-square-foot tenant space previously occupied by a Walgreens drugstore at 21463 Foothill Boulevard. The dispensary would be open seven days a week from 9:00 AM to 8:00 PM and would offer cannabis and cannabis-based products to customers 21 years of age and older for recreational use, and 18 years of age and older for medicinal use, as allowed by State law. The project includes a robust security plan which includes the presence of two professionally licensed and armed security guards on the premises during all business hours that has been reviewed and approved by the Hayward Police Department, which the applicants will be required to implement and adhere to at all times, and would include minor alterations to the interior and exterior of the subject tenant space.

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the owner of that property which were unable to be resolved, and the CUP ultimately expired.

The Planning Commission considered her and her business partner, co-applicant Angilbert Sarkis’s request for the CUP at the subject location on September 25, 2025, and, after a lengthy public hearing in which several members of the public spoke, voted 5-1 to recommend denial to the Council. Nevertheless, staff is recommending that the Council approve the CUP based on the new applicant team’s efforts to address community concerns, their clean track record and extensive experience operating cannabis dispensaries throughout the state, and on the breadth and proven effectiveness of the security measures contained in their security plan which they have implemented consistently at all their other dispensaries throughout California.

FISCAL IMPACT
The proposed dispensary would generate an increase in cannabis tax revenues for the City from sales of cannabis and cannabis-based products. For context, the City currently has one dispensary and one cultivation and wholesale cannabis business and received approximately $750,000 in cannabis tax revenues in fiscal year 2025. The City’s current tax rate for all cannabis-related product sales is seven (7) percent of gross receipts, paid quarterly.

Additionally, the dispensary would be required to renew its Commercial Cannabis Business Permit with the City annually at a cost of $15,000 for as long as it remains operational.

Furthermore, if the CUP is approved, the applicants have committed to paying an advance to the City of $1 million of their projected cannabis tax revenues from the first year of operation as a show of good faith.

BACKGROUND
In 2015, the State of California enacted a comprehensive regulatory framework (Assembly Bills AB 243 and AB 266 and Senate Bill SB 643) for the licensing and enforcement of cultivation, manufacturing, retail sale, transportation, storage, delivery and testing of medicinal cannabis throughout the state. The legislation was known collectively as the Medicinal Cannabis Regulation and Safety Act (MCRSA). On November 8, 2016, California voters passed Proposition 64, the Adult Use of Marijuana Act (AUMA), which legalized adult cannabis use, possession and cultivation for non-medicinal purposes and created a regulatory framework for non-medicinal cannabis businesses. The intent of the combination of the MCRSA and AUMA was to establish a comprehensive regulatory system for the legal cultivation, production and sale of cannabis and cannabis-based products.

On June 15, 2017, the State enacted SB 94, the Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA), which consolidated provisions of the MCRSA into the regulatory framework of the AUMA, thereby creating a unified regulatory system for adult medicinal and recreational cannabis use. MAUCRSA specifically authorized local jurisdictions to adopt and enforce local ordinances to regulate cannabis businesses licensed in accordance with state law, including local zoning and land use regulations, and business license requirements.

Subsequently, on October 30, 2017, and November 28, 2017, the City Council enacted new regulatory and land use ordinances authorizing cannabis businesses in certain zones throughout the City, subject to compliance with local and state regulations.

Attachment I

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At the October 30th meeting, the City Council established a four-step Request for Proposals (RFP) process by which the City would accept proposals during a limited application window from individuals/entities wishing to establish a legal commercial cannabis business within the City and select those individuals/entities who best met the City’s desired set of qualifications. The four steps in the process included:

1. Conducting a criminal background (LiveScan) check;

2. Competitive scoring and ranking of all candidates who passed the LiveScan check;

3. Conducting interviews with candidates who passed the LiveScan check; and

4. Requiring City Council approval of a Commercial Cannabis Business Permit prior to completion of the land use entitlement (typically a CUP) approval process.

In December 2017, the co-applicant, Esther Lopez (Aunty Honeys) was selected as one of three retail dispensary operators approved for a Commercial Cannabis Business Permit (CCBP) by the City Council on July 17, 20181 and subsequently obtained approval of a CUP to operate a retail dispensary at 1147 B Street. Ms. Lopez, along with 11 other commercial cannabis operators, were recommended by City staff out of a total of 73 applicants to be awarded CCBPs for a variety of cannabis-related land use activities, including cultivation, manufacturing, testing, delivery and retail sales. The CUP approval process included a public hearing by the Planning Commission on January 23, 20202, at which the Commission made a recommendation for approval to the City Council and, subsequently, obtained City Council approval at a public hearing on March 3, 20203.

Since 2020, Ms. Lopez was unable to reach a final agreement with the property owner to operate a retail dispensary at the approved location on B Street and ultimately chose to look for a new location as well as partner with another operator, Angilbert Sarkis, who has extensive experience operating retail dispensaries and could assist with the financing and management of the business. The subject location along Foothill Boulevard was chosen by the applicants because it has significantly greater visibility, being situated along one of the City’s major commercial thoroughfares at a signalized intersection that has easy access to Interstate 580 and State Route 238, and plentiful on-site parking located directly outside the storefront entrance.

The shopping center housing the subject tenant space was originally constructed in the 1950s and underwent an exterior remodel in 1983. The two adjoining tenant spaces are currently occupied by a donut shop and martial arts studio, while a dental office occupies the remaining tenant space. The subject tenant space was last occupied by a Walgreens drugstore which ceased operations and vacated the premises in April 2024.

Planning Commission Meeting. On September 25, 2025, the Planning Commission held a public hearing to consider the CUP application and voted 5-1 (with one Commissioner recusing) to recommend denial to the City Council. Thirty members of the public spoke at the hearing, with 27 citizens speaking in opposition and three citizens speaking in support.Nearly all the citizens

1 July 17, 2018 City Council Meeting: https://portal.laserfiche.com/Portal/Browse.aspx?id=215505&repo=r-b6d2994c 2 January 23, 2020 Planning Commission Meeting: https://hayward.legistar.com/LegislationDetail.aspx?ID=4310293&GUID=199A3DE0-0567-4C3D-9E36- 527D524E1DBA&Options=&Search=
3 March 3, 2020 City Council Meeting: https://hayward.legistar.com/LegislationDetail.aspx?ID=4345461&GUID=50C12DDA-1CB9-4D45-AAE0- 57D9A95FDB02&Options=&Search=
Attachment I

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who spoke against the proposal expressed concerns that the location was not appropriate for a dispensary since there was a martial arts studio directly next-door which many children train at on a daily basis, and a residential neighborhood behind and directly across the street from the shopping center which could be adversely impacted by undesirable and/or unlawful activity associated with the dispensary, such as loitering, public consumption/intoxication, and other, potentially more serious crimes such as burglary or armed robbery. The opponents also cited the fact that another dispensary (Garden of Eden) was located only one block away to the north along Foothill Boulevard in unincorporated Alameda County, and that having two dispensaries so close together would result in the creation of a cluster of uses that could convey a negative image for the area at one of the main gateways into the City.

The people who spoke in support of the project cited Ms. Lopez’s longstanding commitment and numerous contributions to the Hayward community as a local business owner who assists many residents with their personal finances, as well as the successful track record of her business partner/team from their experience running several dispensaries in other cities throughout the state. The applicants have prepared a lengthy rebuttal document that attempts to address the concerns raised by the Planning Commission and the citizens who spoke in opposition to the dispensary. This document is included as Attachment VII to this staff report.

The following list summarizes the highlights from this document:
 To address concerns about minors and, particularly, youth who attend the martial arts studio next-door, attempting to enter the dispensary and be exposed to cannabis products, the applicants have demonstrated that neither Cookies (the City’s lone operating retail dispensary) nor any of their 14 dispensary locations throughout California have ever had such an incident occur. They attribute this to their stringent check-in policies which all customers must follow.
 To address concerns about insufficient parking at the site, the applicants and City staff have confirmed that the parking requirements for a 4,000-square-foot dispensary would be significantly less than for a ±10,000-square-foot drugstore (of the nearly 15,000 total square feet of the subject lease space, the Walgreens utilized approximately 10,000 square feet for the retail floor area). Additionally, using the latest Institute of Transportation Engineers (ITE) Trip Generation Manual, staff has confirmed that a 4,000-square-foot dispensary would generate fewer daily and afternoon peak hour trips to the site than the Walgreens that previously occupied the space.  To address concerns about the potential for dispensary customers to loiter in and around the shopping center and consume cannabis products in public, the applicants asked the Police Department to see if such trends had occurred at either Cookies or Garden of Eden. The Hayward Police Department did not find a history of complaints or crimes pertaining to these types of nuisance activities at either location within the past two years.
 To address concerns about the siting of two dispensaries so close together potentially leading to an overconcentration in the area, the applicants point out that, although Garden of Eden is outside the City’s limits and not subject to its siting restrictions, the two dispensaries are still separated by more than the minimum distance of 500 feet required by the Zoning Ordinance.

Attachment I

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 To counter the Planning Commission’s concerns that the dispensary may not generate the estimated cannabis tax revenue for the City, the applicants have committed to pay an advance of $1 million to the City towards their first-year municipal cannabis tax.

Public Outreach: On April 25, 2025, the City mailed 172 Notices of Application Receipt for the project to the owners and occupants of all properties within a 300-foot radius of the project site. At the time, the Planning Division staff received two emails (included as Attachment V) and four phone calls expressing opposition to the proposed dispensary use. All of the individuals who contacted staff expressed similar opinions that the location was too close to the residential neighborhood where they live and the martial arts studio in that retail center may train children and as a result, the dispensary may result in public nuisances and/or crimes, such as loitering, public consumption, and theft.

On September 15, 2025, a Notice of Public Hearing for theSeptember 25th Planning Commission meeting was sent to the same list of addresses that received the Notice of Application Receipt and published in The Daily Review newspaper. While approximately 40 citizens attended the public hearing, staff did not receive any additional written comments from members of the public regarding the proposed project prior to the Planning Commission meeting. However, one additional letter of opposition was submitted by a citizen on the night of the hearing, and this letter has been added to the two emails in Attachment V.

On December 5, 2025, a Notice of Public Hearing was mailed to the same list of addresses that received all of the prior public notices associated with the project and published in The Daily Review newspaper as well. Since the September 25th Planning Commission meeting, the applicants have submitted 68 letters of support from various members of the community.

These letters are provided in Attachment VI.

PROJECT DESCRIPTION
Existing Conditions: The subject tenant space is the anchoring space in a neighborhood shopping center located on a 1.33-acre parcel at the northwest corner of Foothill Boulevard and Grove Way. The total floor area of the shopping center is 21,833 square feet, of which 14,928 would be leased by the applicants for the retail dispensary. The remainder of the floor area is currently occupied by a donut shop, martial arts studio and dental office. The subject property is surrounded by a mix of commercial, residential and institutional uses to the north and east along Foothill Boulevard, and single-family and multi-family residential uses to the south and west along Grove Way and Locust Street.

A total of 61 unassigned parking spaces, including two accessible spaces, are provided on the site for use by all four tenants. Vehicular access to the site is provided via two-way driveways along both Foothill Boulevard and Grove Way, as well as an exit-only driveway along Locust Street. Fifteen of the 61 total parking spaces are provided in a separate parking lot around the back side of the shopping center along Locust Street.

Proposed Project: The proposed retail dispensary would occupy the entire 14,928 square feet of floor area previously occupied by a Walgreens drugstore. Approximately 4,000 square feet of the total floor area facing Foothill Boulevard would serve as the retail area open to the public, Attachment I

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with a security/reception desk situated immediately inside the main entrance, a product display area, and a manager’s office. The remaining two-thirds of the tenant space would serve as warehouse/storage space, a breakroom and restrooms for staff, and an information technology room. The proposed floor plan would require a number of minor alterations to the tenant space, but no changes to the building’s exterior are proposed.

As proposed and reflected in the business plan, the dispensary will offer a range of cannabis and cannabis-based products for both recreational and medicinal use, including edibles, oils, salves, and concentrates. It will be open for business seven days a week from 9:00 AM to 8:00 PM, with staff arriving at approximately 8:45 AM to prepare for opening and staying until 9:00 PM to prepare for closing. Employees will work in three shifts of at least three employees per shift, with the morning shift running from 8:45 AM to 1:45 PM, the afternoon shift from 1:45 PM to 6:00 PM, and the evening shift from 4:00 PM to 9:00 PM. The dispensary would only offer on-site sales with no in-house delivery or on-demand delivery by a third-party provided. A copy of the business plan and project plans are included as Attachments III and IV, respectively.

Safety/Security Requirements. The applicants submitted a detailed safety and security plan to ensure the safety of the employees and product inventory, the adjacent businesses, and the general public. The plan has been reviewed and approved by the Hayward Police Department, which includes many robust security measures including providing two professionally licensed, armed security guards to be present onsite during all business hours and during daily morning pre-opening time beginning at 8:45 AM and after-closing time until 9:00 PM, or whenever the last employee leaves. One of the security guards would be stationed at the entrance to the dispensary and be responsible for checking each patron’s government-issued identification (ID) card to ensure that they are either at least 21 years of age if purchasing for recreational use or at least 18 years of age and possessing a valid physician’s prescription, if purchasing for medicinal use. The second guard would be responsible for monitoring the vendor/back entrance, the product storage area, and the exterior of the premises to ensure that no loitering, public consumption or other illegal activities are occurring which could pose a public nuisance or be threatening in any way to the adjoining businesses and their patrons.

Other safety and security requirements include: 1) installation of a professionally monitored security alarm system that includes entry/exit detection sensors on all door and window openings as well as motion sensor lighting; 2) installation of a surveillance Internet Protocol (IP) camera system covering the entire interior and exterior of the dispensary, including the parking lots, and retention of all video footage for a minimum of 90 days; and 3) installation of commercial-grade Building Code-compliant locks on all windows and doors.

Community Benefits Package. As allowed pursuant to HMC Section 6-14.13(c)(16)4, the applicants have opted to commit to providing community benefits that are in alignment with the City’s priorities and needs. These commitments are as follows:

4 HMC Section 6-14.13 – Commercial Cannabis Business Permit Application:
https://library.municode.com/ca/hayward/codes/municipal_code?nodeId=HAYWARD_MUNICIPAL_CODE_CH6BUPRTR_ART14COCABU_S6-

14.13COCABUPEAP
Attachment I

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1) A one-time contribution of $20,000 to Women and Men on the Way, a local non-profit organization that provides support for men and women suffering and attempting to recover from various addictions.
2) A $1 million advance payment to the City towards the dispensary’s projected first-year revenue business tax obligation.

It should also be noted that the applicants have contacted several other non-profit community organizations with offers to contribute funding to their missions, but most have either been unable or unwilling to accept their offers for various reasons. The applicants have committed to pay up to $100,000 to various community organizations that would be willing and able to accept their contributions. To ensure that this occurs, staff has added a condition of approval requiring the applicants to continue their efforts to find willing entities and fulfill their financial commitment as part of their overall community benefits package. The updated condition of approval is included as Condition #6 in the draft resolution (Attachment II).

POLICY CONTEXT AND ZONING CODE COMPLIANCE
Hayward 2040 General Plan: The project site has a land use designation of Commercial/HighDensity Residential (CHDR) in the Hayward 2040 General Plan5. This land use designation applies to commercial and larger-scale residential properties situated along the City’s primary arterial streets. Allowable uses include all types of retail, dining and service uses, professional offices, multi-story apartment and condominium buildings and mixed-use developments containing ground-floor commercial uses and residential units on upper floors.

The proposed use will add a new specialized retail establishment for adults who choose to purchase legal cannabis products for personal recreational or medical use along one of the City’s main commercial thoroughfares, as allowed under State law. Further, legally operated cannabis businesses can provide significant cannabis tax revenues for the City which, in turn, can assist with the provision of essential services to the City’s residents. Allowing the proposed use would be consistent with the following Hayward 2040 General Plan goals and policies:
 Land Use Policy LU-5.1 – Mix of Uses and Activities: The City shall encourage a mix of retail, service, dining, recreation, entertainment, and cultural uses and activities in regional and community centers to meet a range of neighborhood and citywide needs.  Economic Development Goal ED-1: Diversify the economic base of Hayward to support a robust and stable economy with a diverse range of employment, shopping, and cultural opportunities for residents.
 Economic Development Goal ED-1.4: The City shall establish business attraction efforts that focus on small and medium-sized businesses in emerging and growing business sectors.
 Community Safety CS-1.12 – On-Site Security: The City shall require conditions of approval related to the provision of on-site security and safety measures for bars, nightclubs, live entertainment businesses, and related uses. Conditions shall promote a healthy balance of public safety and nightlife vibrancy, and may include surveillance cameras, crowd management practices, and on-site security staff.

5 Hayward 2040 General Plan: https://www.hayward-ca.gov/2040-General-Plan Attachment I

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Additional discussion on the consistency between the proposed use and the Hayward 2040 General Plan is included in the Staff Analysis section below and contained in the findings in the Draft Resolution contained in Attachment II.

Zoning Ordinance: The project site is located within the General Commercial (CG) zoning district6. The CG district allows the establishment of commercial cannabis retail dispensaries subject to approval of a CUP7. While most CUP applications are typically decided by the Planning Commission, pursuant to HMC Section 10-1.32508, the Commission may refer a CUP application to the City Council at any time, with or without a recommendation. Due to the sensitive nature of retail dispensaries, the Commission has historically referred these CUP applications to the City Council for their consideration. In this case, the Commission considered the application on September 25, 2025, and voted to recommend denial to the Council. The Council must now consider the Commission’s recommendation and decide whether to approve or deny the CUP request.

Pursuant to HMC Section 10-1.32259, the deciding body may approve or conditionally approve a CUP when all of the following findings are met:
a. The proposed use is desirable for the public convenience or welfare; b. The proposed use will not impair the character and integrity of the zoning district and surrounding area;
c. The proposed use will not be detrimental to the public health, safety, or general welfare; and
d. The proposed use is in harmony with applicable City policies and the intent and purpose of the zoning district involved.

The proposed dispensary would help meet a specialized demand for a legal drug product that can be used for both recreational and medicinal purposes throughout the state. While there may be perceptions that such a business could have the potential to adversely impact the surrounding area, a set of stringent conditions crafted by the Police Department requiring implementation of several robust security measures and prohibiting any nuisance-related activities involving cannabis such as loitering and public consumption/intoxication in and around the premises would be placed upon the CUP. In addition, any operator that has been determined to be a public nuisance with excessive calls for service or by operating in violation of their approved conditions of approval may be subject to revocation of the Commercial Cannabis Business Permit and the Conditional Use Permit by the City Council. Additional

6 HMC Section 10-1.1000 – General Commercial District (CG) https://library.municode.com/ca/hayward/codes/municipal_code?nodeId=HAYWARD_MUNICIPAL_CODE_CH10PLZOSU_ART1ZOOR_S10-

1.1000GECODICG
7 HMC Section 10-1.3200 - Conditional Use Permit:
https://library.municode.com/ca/hayward/codes/municipal_code?nodeId=CD_ORD_CH10PLZOSU_ART1ZOOR_S10-1.3200COUSPE 8 HMC Section 10-1.3250 – Referrals:
https://library.municode.com/ca/hayward/codes/municipal_code?nodeId=HAYWARD_MUNICIPAL_CODE_CH10PLZOSU_ART1ZOOR_S10-

1.3200COUSPE_S10-1.3250RE
9 HMC Section 10-1.3225 - Conditional Use Permit Findings:
https://library.municode.com/ca/hayward/codes/municipal_code?nodeId=HAYWARD_MUNICIPAL_CODE_CH10PLZOSU_ART1ZOOR_S10-

1.3200COUSPE_S10-1.3225FI
Attachment I

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analysis related to the required findings is included in the Staff Analysis section below and within the Draft Resolution in Attachment II.

Cannabis Land Uses: HMC Section 10-1.360010 governs all commercial cannabis businesses that cultivate, manufacture, transport, distribute, or sell any type of cannabis or cannabis-based products throughout the City. The various subsections of HMC Section 10-1.3600 contain numerous regulations and requirements governing all commercial cannabis businesses, all of which have been included as conditions in Attachment II. In addition, HMC Section 10-1.361211 prescribes a small number of additional findings meant to supplement those required for approval of a CUP listed above which the decision-making body must make when considering an application for a CUP to operate a retail dispensary. Specifically, these additional findings are required to determine whether the proposed use will detrimentally affect the surrounding neighborhood or place a disproportionate burden on public safety services as compared to other commercial or industrial uses whose businesses do not involve cannabis or cannabisrelated products. The findings are as follows:

1. The proposed cannabis use will not be detrimental to the public health, safety, or general welfare in that the cannabis operation is situated in an appropriate location where sensitive land uses will not be adversely impacted;

2. Appropriate measures have been taken to address nuisances related to odor, noise, exhaust and waste related to the cannabis operation;

3. The cannabis operation is designed to be safe, secure, sustainable and aesthetically compatible with the surrounding area; and

4. The cannabis operation will not place a burden on the provision of public services disproportionate to other industrial or commercial uses.

As stated previously, the proposed use would meet a specialized demand by offering legal cannabis and cannabis-based products for recreational and medicinal use in Hayward and while such activities do have the potential to have adverse impacts on nearby uses, several stringent operational and security-related conditions have been included on the CUP which are designed to prevent such impacts from occurring. As with the CUP findings, a more detailed analysis related to the findings required for approval of the commercial cannabis businesses is included in the Staff Analysis section below and contained in the Draft Resolution in Attachment II.

Commercial Cannabis Business Permit: Pursuant to HMC Section 6.14-1312, an applicant for a new commercial cannabis business must obtain approval of a Commercial Cannabis Business Permit by the City Council to ensure that all regulatory requirements are met. Ms. Lopez completed this task when she obtained CCBP approval to operate a retail dispensary (Aunty Honey’s) at 1147 B Street from the City Council on July 17, 2018. Since Ms. Lopez is now

10 HMC Section 10-1.3600 – Cannabis:
https://library.municode.com/ca/hayward/codes/municipal_code?nodeId=HAYWARD_MUNICIPAL_CODE_CH10PLZOSU_ART1ZOOR_S10-

1.3600CA
11 HMC Section 10-1.3612 – Findings:
https://library.municode.com/ca/hayward/codes/municipal_code?nodeId=HAYWARD_MUNICIPAL_CODE_CH10PLZOSU_ART1ZOOR_S10-

1.3600CA_S10-1.3612FI
12 HMC Section 6-14.13 – Commercial Cannabis Business Permit Application:
https://library.municode.com/ca/hayward/codes/municipal_code?nodeId=HAYWARD_MUNICIPAL_CODE_CH6BUPRTR_ART14COCABU_S6-

14.13COCABUPEAP
Attachment I

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transferring partial, minority ownership and operational control of her previously approved business to Mr. Sarkis, Mr. Sarkis was required to undergo the required background/LiveScan check to ensure that he did not have a history of committing any drug-related or other serious crimes. His background check was previously processed by the Hayward Police Department as part of the New Change of Owner/Attestation required by the City and did not reveal any criminal history.

HMC Section 6.14-13 also requires that the applicants obtain the necessary land use entitlements which in this case, the CUP is subject to City Council review. Should the CUP application be approved, the applicants would be required to obtain a cannabis license from the State Department of Cannabis Control prior to operation and failure to obtain the State license, as well as maintaining the license in good standing, would be grounds for revocation.

In addition, all Commercial Cannabis Business Permits issued by the City are valid for one (1) year and must be renewed annually following the completion of mandatory safety inspection and demonstrated compliance with all local and state regulations, including all conditions of approval of the CUP.

STAFF ANALYSIS
Staff has reviewed the project plans, business plan, and safety/security plan submitted by the applicants and believes the City Council can make the required findings to approve the CUP, subject to the findings and recommended conditions of approval in the Draft Resolution contained in Attachment II. As mentioned previously, the proposed use would contribute to the public welfare by providing a safe and secure environment for adults to purchase legal cannabis and cannabis-based products for their private consumption at a convenient location along a major thoroughfare that currently offers a wide variety of other retail and service uses. Itis also possible that the dispensary’s customers may patronize other nearby businesses, including the many restaurants located along Foothill Boulevard. Sales and cannabis tax revenues from a legal cannabis dispensary could also be significant for the City and could help to fund essential City services.

Furthermore, allowing the proposed use would be consistent with the goals and policies of the Hayward 2040 General Plan, which call for supporting local small businesses and providing a wide range of goods and services within the City that meet the everyday and specialized needs of Hayward residents, including legal drugs such as cannabis that can be used in California for recreational and medicinal purposes. Additionally, the zoning on the property allows for a wide variety of retail uses, including cannabis dispensaries, subject to approval of a CUP, so the proposed use is permissible subject to the decision-making body being able to make the prescribed findings in support of an approval.

A significant amount of discussion at the September 25th Planning Commission hearing focused on the potential for the proposed dispensary to generate undesirable and/or criminal activity, including public consumption/intoxication, loitering, robberies and sales to minors. In response to questions raised about possible undesirable and/or illegal activity that might occur, the Hayward Police Department analyzed the recent history of calls for service at the City’s lone operational retail dispensary, Cookies, the Garden of Eden dispensary located nearby in Attachment I

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unincorporated Alameda County, and the Walgreens drugstore that previously occupied the site. The following table summarizes the results of this analysis:

Business
Total Calls for
Service in
2024-2025
Incidents
Involving
Minors
Loitering, Public
Consumption,
and/or Intoxication
Theft, Robberies,
and/or Burglaries
Cookies 47 0 0
4 burglaries;
1 robbery
Garden of Eden 14 0 0 0
Walgreens
114 (in 2023-
2024; business
closed in 2025)

N/A N/A
36 petty thefts;
3 grand thefts;
3 robberies
It should be noted that some of the calls for service listed in the table did not directly involve a crime or incident at the premises. In some cases, the business simply happened to be the closest location to a reported, unrelated incident such as the issuance of a parking ticket or a moving violation. While Cookies has been the target of five attempted burglaries/robberies over the past two years, neither it nor Garden of Eden has a recent history of allowing minors to enter their premises and purchase products, and there have been no issues with customers or other members of the public loitering and/or consuming cannabis products publicly outside either establishment. The Walgreens that previously occupied the site had a higher volume of calls for services and was the subject of a high number of petty thefts (the stealing of items having a value of $950 or less), as well as a small number of grand thefts (involving items having a value greater than $950) and robberies.

As reflected in the above table, neither dispensary has generated a significant number of calls for service involving serious crimes such as armed robbery, burglary or selling products to minors. While Cookies has been the target of some attempted robberies and burglaries over the past two years, the applicants’ security plan contains several effective measures which have been reviewed and approved by the Hayward Police Department designed to reduce the likelihood of such crimes occurring at the proposed dispensary. However, even with the implementation of such measures, it is nevertheless impossible to stop all criminal activity from occurring. Staff contacted the Planning Directors of both San Leandro and Union City to see if their cannabis dispensaries had generated a significant number of serious crimes or nuisance complaints from neighbors. San Leandro currently has three dispensaries operating in its industrial areas and, according to its Planning Director, none of have generated significant problems for that City; a fourth dispensary is currently in application and is expected to be approved in the coming year. Union City has two dispensaries currently in operation, with one in the Union Landing Shopping Center and one in an industrial area along Decoto Road less than a block from the Alvarado residential neighborhood. Neither dispensary has a history of generating nuisance-related complaints from adjacent businesses or nearby residents; however, the Decoto Road location was the victim of a break-in and robbery with the perpetrators driving a vehicle through the storefront entrance. To prevent this from reoccurring, the dispensary installed a row of steel bollards outside its storefront entrance. The Attachment I

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applicants are proposing to install the same type of bollard outside their storefront entrance as well.

Staff has drafted a rigorous set of conditions of approval regulating the daily operations of the proposed dispensary, including several crafted by the Hayward Police Department that specifically pertain to security measures in an effort to mitigate any perceived unsafe, nuisance and/or criminal activity at the establishment. With the inclusion of these conditions, staff does not believe that the use will have a detrimental impact on public safety or welfare. The applicants will be required to adhere to the conditions at all times and City staff will conduct annual compliance inspections at the establishment to ensure it is operating in accordance with all applicable requirements for a retail dispensary. Any failure to do so, or if the use consistently generates a high volume of calls for service for the Hayward Police Department involving illegal activities, could constitute grounds for revocation of the CUP. For these reasons, staff recommends that the Council approve the CUP based on the findings and subject to the conditions in the Draft Resolution in Attachment II.

ENVIRONMENTAL REVIEW
The proposed project is categorically exempt from CEQA pursuant to CEQA Guidelines Section 15301, Existing Facilities, which exempts projects that utilize existing structures while only making minor modifications to them. The proposed project involves only minor alterations to an existing commercial building with no expansion of the subject tenant space or changes that would be visible to the exterior.

At the Planning Commission meeting there was concern expressed by many of the neighbors that the retail dispensary would generate significantly more traffic than the drugstore that previously occupied the site, and that said traffic would exacerbate the congestion that already occurs along Foothill Boulevard in the afternoon. City Transportation staff compared the trip generation rates for a drugstore and retail dispensary using the Institute of Transportation Engineers’ 10th Edition Trip Generation Manual and determined that a drugstore such as a Walgreens or CVS would be expected to generate 15 more trips to the site during the PM peak hour and 70 more total daily trips. As such, a retail dispensary would be expected to generate fewer trips than a drugstore or similar retail use such as a neighborhood market.

ECONOMIC IMPACT
The proposed dispensary could result in a minor positive economic benefit for other nearby businesses by drawing more customers to the subject shopping center, who, in turn, might elect to patronize other establishments in the surrounding area such as shops and restaurants, but the City has no concrete evidence that its lone operational dispensary at 1104 B Street has generated spillover economic benefits for other downtown businesses.

Nevertheless, there has been high demand for cannabis and cannabis-based products for both medicinal and recreational use ever since the State legalized consumption, and the applicants’ management team has a track record of running successful dispensaries throughout the Central Valley that have contributed economically to the cities where they are located.

Attachment I

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STRATEGIC ROADMAP
In January 2024, the Council adopted six Strategic Priorities as part of its three-year Strategic Roadmap:

1. Enhance Community Safety & Quality of Life

2. Preserve, Protect & Produce Housing for All

3. Confront Climate Crisis & Champion Environmental Justice

4. Invest in Infrastructure

5. Grow the Economy

6. Strengthen Organizational Health
Included as one of the five projects under Strategic Priority No. 5, “Grow the Economy,” was Objective 2: Invest in plans and programs that create thriving commercial corridors with an added focus on the Downtown. The proposed use would fill a long-vacant medium-sized tenant space that cannot be easily occupied by a wide variety of uses along a major commercial thoroughfare at one of the main gateways into the City with a business having the potential to reactivate the subject shopping center and generate significant sales tax revenue for City. The previous tenant occupying the space was a corporate drugstore chain, but such uses are no longer expanding or relocating because they are being replaced by a combination of big-box retailers with in-house pharmacies and online pharmaceutical/prescription filling/delivery services. There is no longer a large retail rental market for tenant spaces of this size.

NEXT STEPS
If the Council votes to approve the CUP, the applicants would be required to obtain a building permit to remodel the space and convert it from the former drugstore into the proposed dispensary. The applicants would also be required to obtain a business license and all operational licenses required by the State Department of Cannabis Control. Following approval, City staff would work closely with them to ensure all operational requirements contained in the conditions of approval are adhered to and that all safety/security measures in the security plan are implemented and in place prior to the dispensary’s commencing operations and opening to the public.

If the Council votes to deny the CUP, it should provide staff with clear direction as to the basis for the denial and direct staff to return with a resolution containing findings for denial, which would be scheduled for a future Council meeting at a date to be determined.

In addition, if Council would like staff to evaluate other areas in the City where retail cannabis dispensaries could be located, it could direct staff to look at increasing the number of zoning districts where they may locate. Any potential changes to the Zoning Ordinance would be addressed as part of the ongoing Business Friendly Ordinance project which staff expects to be completed by early Summer 2026.

Prepared by: Steve Kowalski, Senior Planner
Attachment I

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Recommended by: Sara Buizer, AICP, Development Services Director Approved by:
_____________________________________________
Jennifer Ott, City Manager

ATTACHMENT II

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HAYWARD CITY COUNCIL
RESOLUTION NO. 25-___
Introduced by Council Member _________

RESOLUTION APPROVING A CONDITIONAL USE PERMIT TO OPERATE A

COMMERCIAL CANNABIS RETAIL DISPENSARY IN A VACANT TENANT SPACE IN A SHOPPING CENTER AT 21463 FOOTHILL BOULEVARD
WHEREAS, in 2015, the State of California enacted a comprehensive regulatory framework (Assembly Bills AB 243 and AB 266 and Senate Bill SB 643, collectively referred to as the Medicinal Cannabis Regulation and Safety Act or “MCRSA”, for the licensing and enforcement of cultivation, manufacturing, retail sale, transportation, storage, delivery and testing of medicinal cannabis throughout the state; and WHEREAS, on November 8, 2016, California voters passed Proposition 64, the Adult Use of Marijuana Act (AUMA), which legalized adult possession, cultivation and use of cannabis for non-medicinal (recreational) purposes and created a regulatory framework for recreational cannabis businesses; and
WHEREAS, On June 15, 2017, the State enacted SB 94, the Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA), which consolidated provisions of the MCRSA into the regulatory framework of the AUMA, thereby creating a unified regulatory system for adult medicinal and recreational cannabis use. MAUCRSA specifically authorized local jurisdictions to adopt and enforce local ordinances to regulate cannabis businesses licensed in accordance with state law, including local zoning and land use regulations, and business license requirements; and
WHEREAS, on October 30, 2017, and November 28, 2017, the City Council enacted new regulatory and land use ordinances authorizing cannabis businesses in certain zones throughout the City, subject to compliance with local and state regulations; and WHEREAS, on July 17, 2018, Esther Lopez (doing business as “Aunty Honeys”) was selected as one of three commercial cannabis retail dispensary operators approved for a Commercial Cannabis Business Permit (CCBP) by the City Council; and WHEREAS, on March 3, 2020, the City Council approved Conditional Use Permit Application No. 201806127 allowing Ms. Lopez to operate the Aunty Honeys retail dispensary at 1147 B Street in downtown Hayward; and

ATTACHMENT II

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WHEREAS, Ms. Lopez was ultimately unable to commence business at the approved location at 1147 B Street due to complications that arose with the property owner related to the leasing of the property and, instead, chose to look for a new location as well as partner with another operator, Angilbert Sarkis, who has experience operating retail dispensaries throughout the state and could assist with the financing and management of the business; and
WHEREAS, on April 17, 2025, Ms. Lopez and Mr. Sarkis, as co-applicants doing business as “Phenos Hayward,” filed Conditional Use Permit Application No. UP-25-0011 to operate a new retail dispensary at the subject location at 21463 Foothill Boulevard; and WHEREAS, on September 25, 2025, the Planning Commission held a duly noticed public hearing to consider the Conditional Use Permit application for the proposed commercial cannabis retail dispensary, received public testimony, and voted 5-1 (with one Commissioner recusing) to forward the matter to the City Council with a recommendation for denial; and
WHEREAS, on December 5, 2025, notice of a public hearing was published in the manner required by law, and said hearing was duly held by the City Council and public testimony was received on December 16, 2025.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City Of Hayward hereby finds and determines as follows:

CALIFORNIA ENVIRONMENTAL QUALITY ACT

1. The proposed project is categorically exempt from the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Section 15301, Existing Facilities, which exempts projects that utilize existing structures while only making minor interior and/or exterior modifications to them. The proposed project involves only minor alterations to the interior of an existing commercial building with no expansion of the subject tenant space.

CONDITIONAL USE PERMIT
A. The proposed use is desirable to the public convenience or welfare; The proposed use is desirable for the public convenience and welfare in that it would result in the establishment of a legal retail outlet for cannabis-based products in a large tenant space in a shopping center located on one of the City’s main commercial thoroughfares that has remained vacant since the previous retail tenant moved out.

Cannabis retail sales are a significant contributor to the City’s sales tax base and legal medicinal cannabis-based products can provide relief for people suffering from pains and various ailments safely.

ATTACHMENT II

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B. The proposed use will not impair the character and integrity of the zoning district and surrounding area;
The proposed use would occupy the anchoring tenant space in a shopping center that has been vacant for nearly two years. Furthermore, establishment of the proposed dispensary could provide spillover economic benefits to nearby businesses from its patrons. As conditioned, the applicant will be required to adhere to several operational conditions of approval and implement numerous safety and security measures crafted to mitigate any negative impacts and curtail any possible illegal activity that could have an adverse effect on public safety and welfare, as well as the surrounding businesses.

C. The proposed use will not be detrimental to the public health, safety or general welfare.

The proposed project, as conditioned, will not be detrimental to the public health, safety, or general welfare in that establishment will be subject to the regulations and requirements prescribed by the State Department of Cannabis Control (DCC) for a retail dispensary, as well as all fire, building/life safety codes, as applicable. In addition, the conditions of approval will require the applicant to control cannabis odors so that they undetectable outside the premises, and implement the following safety/security measures to the satisfaction of the Hayward Police Department: 1) have two professionally licensed security guards on the premises during all business hours to monitor the main entrance and back of house; 2) utilize computerized identification scanners on all customers who enter the establishment to check identifications and ensure that no underage patrons enter the establishment; 3) install a professionally-monitored security alarm system for the establishment and commercial-grade locks on all windows and doors; and 4) prohibit individuals from loitering or ingesting purchased products around the premises. Finally, the applicant will be required to operate a closed-circuit television (CCTV) surveillance camera system within and around the perimeter of the establishment 24 hours a day and make the video footage available to the Police Department upon request. Violations of any of the conditions of approval or the restrictions of the DCC or the City of Hayward may result in the revocation of the business license and this Conditional Use Permit at the expense of the applicant.

D. The proposed use is in harmony with applicable City policies and the intent and purpose of the zoning district involved.

The proposed use is in harmony with the applicable City policies and the intent and purpose of the zoning district involved in that the subject site is located within the General Commercial (CG) zoning district and is designated as Commercial/High Density Residential (CHDR) in the Hayward 2040 General Plan. The CG zoning district allows commercial cannabis retail dispensaries subject to approval of a Conditional Use Permit. The CHDR General Plan land use designation applies to properties along

ATTACHMENT II

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the City’s major commercial thoroughfares and prescribes policies which are intended to ensure the provision of a wide variety of retail goods and professional services for the City’s residents and workforce. Allowed uses under the CHDR land use designation include retail shops, restaurants and commercial services as well as professional offices and higher density residential uses. The proposed use will add a new specialized retail establishment for adults who choose to purchase legal cannabis products for personal use, consistent with the following goals and policies of the Hayward 2040 General Plan:
 Land Use Policy LU-5.1 – Mix of Uses and Activities. The City shall encourage a mix of retail, service, dining, recreation, entertainment, and cultural uses and activities in regional and community centers to meet a range of neighborhood and citywide needs.
 Economic Development Goal ED-1: Diversify the economic base of Hayward to support a robust and stable economy with a diverse range of employment, shopping, and cultural opportunities for residents.
 Economic Development Goal ED-1.4: The City shall establish business attraction efforts that focus on small and medium-sized businesses with emerging and growing business sectors.
 Community Safety CS-1.12 – On-Site Security. The City shall require conditions of approval related to the provision of on-site security and safety measures for bars, nightclubs, live entertainment businesses, and related uses. Conditions shall promote a healthy balance of public safety and nightlife vibrancy, and may include surveillance cameras, crowd management practices, and on-site security staff.

Additionally, as conditioned, the proposed use will also be required to operate in strict accordance with various safety and security measures prescribed by the Hayward Police Department to minimize any negative impacts to adjacent properties or uses, and deter criminal activity associated with the business, including theft, loitering and underage purchasing/consumption.

COMMERCIAL CANNABIS BUSINESS
A. The proposed cannabis use will not be detrimental to the public health, safety or general welfare in that the cannabis operation is situated in an appropriate location where sensitive land uses will not be adversely impacted.

The subject tenant space which the retail dispensary will occupy was previously occupied by a Walgreens drugstore, the anchor tenant space for a medium-sized neighborhood shopping center also containing a donut shop, dental office and martial arts studio that offers classes for students of all ages. The shopping center is situated along Foothill Boulevard, a major commercial thoroughfare that offers a wide variety of commercial and service uses, including Lincoln Landing, a large mixed-use development, and a major shopping center anchored by a Safeway supermarket, motels, and several restaurants, shops and professional offices. A

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retail cannabis dispensary would be a compatible use with the other commercial and service uses located along the boulevard, and conditions of approval have been included requiring robust security measures designed to deter criminal activity that could adversely impact the adjacent businesses and residential uses.

B. Appropriate measures have been taken to address nuisances related to odor, noise, exhaust, and waste related to the cannabis operation.

Conditions of approval have been included that will require the dispensary operators to store and distribute its products and dispense waste securely in order to prevent theft, diversion, and public nuisances. Odors and exhaust will not be applicable to the business since no cultivation or manufacturing activities will be conducted on the site.

C. The cannabis operation is designed to be safe, secure, sustainable and aesthetically compatible with the surrounding area.

The proposed use would occupy an existing tenant space that has been vacant for the last two years, thereby supporting retail activity in Hayward which could have spillover economic benefits for the surrounding businesses from its customers. The dispensary will be required to comply with several robust security-related conditions of approval intended to deter break-ins and other illegal activity at the premises that could jeopardize public safety and the security of the neighboring businesses in the shopping center and nearby residences.

D. The cannabis operation will not place a burden on the provision of public services disproportionate to other industrial or commercial uses.

A set of robust operational conditions of approval and security requirements crafted by the Hayward Police Department will be imposed upon the proposed use which are designed to help deter criminal activity and minimize the burden on everyday police services. These conditions and operational requirements are similar to those placed on other recently-approved cannabis businesses and, as such, will help ensure that this particular dispensary does not place a disproportionate burden on public safety services compared to other similar cannabis-based uses.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Hayward, based on the foregoing findings, hereby adopts the findings in support of approval of Conditional Use Permit Application No. UP-25-0011, subject to the Conditions of Approval contained in this Resolution.

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IN COUNCIL, HAYWARD, CALIFORNIA, ___________________________.

ADOPTED BY THE FOLLOWING VOTE:

AYES: COUNCIL MEMBERS:

MAYOR:

NOES: COUNCIL MEMBERS:

ABSTAIN: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:

ATTEST: ______________________________________
City Clerk of the City of Hayward
APPROVED AS TO FORM:
__________________________________________
City Attorney of the City of Hayward

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CITY OF HAYWARD PLANNING COMMISSION
CONDITIONAL USE PERMIT APPLICATION NO. UP-25-0011
PHENOS HAYWARD CANNABIS DISPENSARY - 21463 FOOTHILL BLVD.

CONDITIONS OF APPROVAL
General Conditions
Planning

1. The applicant shall assume the defense of and shall pay on behalf of and hold harmless the City, its officers, employees, volunteers and agents from and against any or all loss, liability, expense, claim costs, suits and damages of every kind, nature and description directly or indirectly arising from the performance and action of this permit.

2. The retail dispensary shall operate in accordance with these conditions of approval and the approved Project Plans prepared by PQ Design Studio Inc. dated June 12, 2025, and the approved Business and Operations Plan prepared by Gream Enterprises, Inc. DBA Phenos Hayward submitted on April 17, 2025. Any future changes to the approved plans and Business and Operations Plan may require the submittal of a new application for a Conditional Use Permit and shall be subject to additional review and approval by the City prior to their implementation.

3. Failure to comply with any of the conditions set forth in this approval, or as subsequently amended in writing by the City and agreed to by the applicant, may result in failure to obtain a Building Final and/or Certificate of Occupancy until full compliance is achieved. The City’s requirement for full compliance may require minor corrections and/or complete demolition of a non-compliant improvement regardless of costs incurred where the project does not comply with the design requirements and approvals that the applicant agreed to when permits were pulled to construct the project. The applicant acknowledges that the conditions set forth in this approval are not intended to supersede any obligations imposed pursuant to Chapter 6, Article 14 of the Hayward Municipal Code (HMC) related to commercial cannabis permits, as it may be amended from time to time.

4. The applicant/business owner, property owner or designated representative shall allow the City’s staff to access the property for site inspections to confirm all approved conditions have been completed and are being adhered to in compliance with all adopted City, staff and federal laws.

5. The applicant/business owner shall obtain a sign permit prior to the installation of any new signage on the exterior of the building.

6. The applicant shall continue its efforts to find local non-profit organizations that are willing and able to accept a portion of the $100,000 which it has committed to provide as part of the approved community benefits package, and shall notify the Planning Division and provide proof of payment when it has found such entity/ies.

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7. The applicant/business owner shall only employ persons at least 21 years of age and shall keep employment records that include each employee’s proof of age. Said records shall be provided to the City upon request.

8. The retail dispensary shall have an on-site business manager at all times who is responsible for overall operation whenever employees are conducting operations and shall provide the City with the contact information for such person(s), including mobile telephone numbers and email addresses. The applicant/business owner shall also provide the City with the name and contact information of at least one (1) manager who can be reached 24 hours a day in case of an emergency.

9. The applicant/business owner shall maintain records of all sales transactions in accordance with the requirements of state law.

10. No person shall be permitted to enter the retail dispensary without government-issued photo identification. The retail dispensary shall not offer cannabis or cannabis products to any underaged person or any person, whether by purchase, trade, gift or otherwise, who does not possess a valid government-issued photo identification card or a valid physician's prescription under Section 11362.712 of the Health and Safety Code.

11. The retail dispensary shall be designed to prevent unauthorized entrance into areas containing cannabis or cannabis products. Limited access areas accessible to only authorized personnel shall be established.

12. Commercial cannabis and cannabis products that are not used for display purposes or immediate sale shall be stored in a secured and locked room, safe, or vault, and in a manner reasonably designed to prevent diversion, theft, and loss.

13. The retail dispensary shall not have an on-site or on-staff physician to evaluate patients and provide a recommendation for medical cannabis.

14. The business owner shall take reasonable steps to discourage and correct objectionable conditions that constitute a nuisance in parking areas, sidewalks, alleys and other areas surrounding the premises during business hours, if directly related to the patrons of the retail dispensary. For the purposes of this condition, “reasonable steps” shall include calling the police in a timely manner, and requesting those engaging in nuisance activities to cease those activities unless personal safety would be threatened in making such a request.

15. The retail dispensary shall maintain a copy of the valid operating Conditional Use Permit and Commercial Cannabis Business Permit issued by the City on display during business hours and in a conspicuous location so that it may be readily seen by all persons entering the facility.

16. No on-site consumption of cannabis or cannabis products is permitted at any time.

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17. The permitted business hours shall be from 9:00 AM to 8:00 PM, seven days a week.

Any changes to the approved business hours shall require prior approval of the City of Hayward Development Services Director and Police Chief, or their designees.

18. Storefront windows shall be kept free and clear of all interior or exterior obstructions including, but not limited to, display cases, curtains, black-out window tinting, signage, posters or any other methods of obstructing or obscuring natural light and clear views into the tenant space.

19. No cannabis odors shall be detectable outside of the retail dispensary. The applicant/business owner incorporate and maintain adequate on-site odor control measures such that any cannabis-related odors cannot be readily outside of the dispensary or within any adjoining businesses within the subject shopping center.

20. No Commercial Cannabis Business Permit or use permit issued by the City pursuant to Chapter 6, Article 14 and Chapter 10, Article 1 of the HMC shall be sold, transferred, or assigned by the permittee or by operation of law, to any other person without prior approval of the City, pursuant to the limitations outlined in HMC Section 10-1.3604.

Any such sale, transfer, assignment, attempted sale, attempted transfer or attempted assignment without prior approval of the City shall constitute a violation of this Article and result in immediate revocation of the permit and the permit shall thereafter be null and void. Transfers of ownership interests that result in new majority ownership are not permitted and operators will be required to re-apply for a new commercial cannabis permit, consistent with the provisions outlined in HMC Chapter 6, Article 14.

Any transfer of ownership or operational control of a commercial cannabis business which results in a lapse of normal operations for a period of six (6) months or more shall be required to obtain a new use permit, consistent with HMC Sections 10-1.3170 or 10-1.3270, as applicable. Any changes to the approved business name, changes to the product marketing, and/or rebranding of the commercial cannabis business shall be subject to review and approval by the City prior to any changes.

21. The City may require modification, discontinuation or revocation of this Conditional Use Permit if it determines that the retail dispensary is being operated in a manner that:
(a) adversely affects the health or safety of persons living or working or patronizing the other businesses in the area surrounding the dispensary; (b) contributes to or creates a public nuisance in the opinion of the City Manager and/or Chief of Police; (c) has resulted in excessive nuisance activities, including disturbances of the peace, illegal drug-related activity, diversion of commercial cannabis or cannabis products, public intoxication, smoking in public, harassment of passersby, littering, or obstruction of any street, sidewalk or public walkway, including the walkways around the subject shopping center; or (d) violates any provision of the Hayward Municipal Code or condition imposed by a City-issued permit, or violates any provision of any other local or state regulation or order, including those of state law, or violates any condition imposed by permits or licenses issued in compliance with those laws.

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22. This approval shall expire three (3) years after the effective date of approval unless a building permit application with plans matching the approved plans for this Conditional Use Permit have been submitted and accepted for processing by the Building Official.

23. The applicant/business owner shall obtain and maintain a valid Commercial Cannabis Business Permit from the City, in addition to any other state and local permits.

Commercial Cannabis Business Permit applications and renewals are subject to the requirements of HMC Section 6-14.15. Commercial Cannabis Business Permits are valid for a period of one year and shall be renewed annually by the business owner. The permit is invalid if the term has expired and the annual fee, as established in the City of Hayward Master Fee Schedule, has not been paid in full and on time. Non-payment will result in a violation penalty fee in accordance with the Master Feel Schedule.

Additionally, the City may invalidate or suspend a Commercial Cannabis Business Permit for excessive calls for service or nuisance citations.

24. The retail dispensary shall not commence operations until the applicant/business owner can demonstrate compliance with all necessary state and local licenses (dual licensing) and jurisdictional agency permits. Failure to demonstrate dual licensing in accordance with the Hayward Municipal Code shall be grounds for revocation of a Cityapproved permit. Revocation of a local permit and/or a state license shall terminate the ability of the retail dispensary to operate until a new permit and/or state license has been obtained.

25. The applicant shall maintain books, records, accounts, public safety calls for service, and all data and information relevant to its operations, and allow the City access to such records for purposes of conducting an audit or examination to determine compliance with the Hayward Municipal Code and other local regulations, including compliance with local tax obligations. Prior to the applicant’s Commercial Cannabis Business Permit renewal each year, the applicant shall provide the records to the City for review to verify compliance.

Community Preservation

26. The retail dispensary shall maintain and visibly post valid copies of all required State, and City permits, including, but not limited to, the State Department of Cannabis Control license, City of Hayward Commercial Cannabis Business Permit and business license, and any other pertinent permits and licenses.

27. Every owner of real property containing a Commercial Cannabis Business within the City is required to manage the property in a manner so as not to violate any provisions of the Cannabis Ordinance, HMC Section 10-1.3600, or any State regulations. The property owner remains ultimately liable for all penalties and fees as a result of a violation of any of the requirements of the Commercial Cannabis Business thereof, regardless of any contract or tenant agreement or other third parties’ involvement.

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Building

28. The project shall comply with the edition of the California Building Code (CBC) in effect on the date of the building permit application for the project’s tenant improvements.

29. The project shall comply with the California Plumbing Code (CPC) with regard to plumbing fixtures. Please note that if the change of use or occupancy from the prior tenant results in an increase of occupant load, a plumbing fixture analysis will be required (see the notes in 2022 CPC Table 422.1 under the heading). A change in occupant load may result in additional fixtures being required in the restrooms.

30. The proposed project will require disabled access upgrades based on CBC Ch. 11B section 202. For the building permit application, please include path of travel upgrade drawings and a completed Summary of Disabled Access Upgrades form which can be found on the City of Hayward Building Division’s website.

31. For the building permit drawings, please include PME sheets as needed and a complete Title 24 energy report.

Fire Safety

32. A building permit is required for the installation of steel storage racks greater than six (6) feet in height. A Fire Department Annual Operational Permit is required for any combustible storage (floor and/or rack) which exceeds 12 feet in height (Class I-IV type commodities) and/or any high hazard storage which includes commodities such as hazardous materials, flammable liquids, plastics, foam and rubber products, or any other classified commodity as dictated by the California Fire Code (CFC) and National Fire Protection Association (NFPA) 13 Standards, which exceeds 6 feet in height.

33. All building units shall have approved address numbers. Address identification numbers shall be placed in a position that is plainly legible and visible from the street or road fronting the property. Where access is by means of a private driveway or parking lot and the building cannot be viewed from the public way, a monument, pole or other sign or means shall be used to identify the structure.

34. Duct smoke detectors that are installed within the heating/ventilation/air conditioning (HVAC) system (AHU’s and Smoke Dampers) shall meet the California Mechanical Code for installation and the California Fire Code. Such detectors shall be interconnected to the building’s main fire alarm control panel and zoned separately.

35. 2A:10BC type fire extinguishers are required throughout the building for every 75 feet of travel or every 3,000 square feet of space, including in dining/breakroom and service areas.

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36. The existing overhead fire sprinkler system shall be altered to provide adequate coverage for the new operation. A separate submittal and permit is required for the fire sprinkler alteration by a California licensed C16 contractor.

37. The existing fire alarm system shall be altered to provide adequate coverage for the newly remodeled building. A separate submittal is required for the fire alarm alteration by a California licensed C10 contractor.

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Police

38. The business shall provide adequate security on the premises, including on-site security, lighting and alarms, to ensure public safety and the safety of persons within the facility and to protect the premises from theft. Additionally, all Commercial Cannabis Businesses and Cannabis Operators shall include a security and safety plan prepared and implemented to the satisfaction of the Hayward Police Department.

39. Surveillance IP video cameras shall be installed at the public and vendor entrances and shall be maintained in good working order to provide coverage on a 24-hour real-time basis of all internal and exterior areas where Cannabis is dispensed. The cameras shall allow for remote access to be provided to the Hayward Police Department and shall be oriented in a manner that provides clear and certain identification of all individuals within those areas. The surveillance cameras shall cover all parking lots and exterior viewpoints of the cannabis business. IP cameras shall remain active at all times and shall be capable of operating under any lighting condition. Security video footage must use standard industry format to support criminal investigations and shall be maintained for a minimum of 90 days.

40. Security guards shall use an identification (ID) card scanner to verify the authenticity of IDs for all patrons who enter the business.

41. All points of ingress and egress to the proposed use shall be secured with Building Code compliant commercial-grade, non-residential door locks and/or window locks. There shall be two security guards present during all business hours. One guard shall be stationed at the vendor entrance and be responsible for monitoring the exterior of the dispensary to ensure no loitering or public consumption occurs, and one shall be stationed at the public entrance, unless otherwise permitted in writing by the Chief of Police.

42. A professionally monitored security alarm system shall be installed and maintained in good working condition. The alarm system shall include sensors to detect entry and exit from all secure areas and all windows. The applicant shall keep the name and contact information of the alarm system installation and monitoring company as part of the Commercial Cannabis Business's onsite books and records.

43. Cannabis products and associated product distribution and dispensing waste shall be stored and secured in a manner that prevents diversion, theft, loss, hazards and nuisance.

44. The business shall implement procedures for safe and secure transportation and delivery of commercial medical and non-medical cannabis, including all cannabis products and currency, in accordance with local and state law. None of the vehicles associated with the business shall have markings or advertising that indicates the presence of cannabis on-site.

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45. Security measures shall be designed to ensure emergency access is provided to the Hayward Police Department and Hayward Fire Department for all areas on the premises in case of an emergency.

46. During regular business hours, the building premises shall be accessible, upon request, to any identified Hayward Police Department, Building Division or Code Enforcement employee for random and/or unannounced inspections.

47. All employees working in conjunction with the retail dispensary shall be subject to background/LiveScan checks. Additionally, all employees shall furnish the Hayward Police Department a state or federal registered Identification Card upon request.

48. The business operator shall identify a local contact who will be responsible for addressing security and safety issues and shall provide and keep current contact information to the Hayward Police Department as part of the permitting process.

49. The business operator shall notify the Hayward Police Department regarding any theft or loss of product, robbery or unauthorized access or breaches.

Prior to the Issuance of Building Permit
Planning

50. All outstanding fees owed to the City for the staff time spent processing and obtaining the approval of this Conditional Use Permit application shall be paid in full prior to consideration of any approval extension requests and/or the issuance of a building permit to construct the project.

Water Pollution Source Control

51. The trash enclosure shall have a drain connection to the sanitary sewer serving the property with a minimum 5 percent slope to the drain. Details for the sewer connection shall be included in the building permit plan set for the project.

Solid Waste

52. All construction and demolition debris shall be recycled. Submittal of a waste management plan shall be required at the time of building permit application submittal.

Please either visit the City’s Green Halo website and create a waste management plan online at: https://wastetracking.com/city/hayward/ or complete a Debris Recycling Statement, available online here: http://www.hayward-ca.gov/services/cityservices/construction-and-demolition-debris-disposal.

53. The applicant shall contact Waste Management of Alameda County at (510) 537-5500 to determine whether the business’s carts/bins can be serviced at the trash enclosure or be required to be placed out at the curbside for collection. If the carts or bins must

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be placed curbside for collection, such carts or bins shall not be placed earlier than 6:00 AM on the day before scheduled collection, and shall be retrieved and removed from public view by midnight on the day of collection.
-End of Conditions-

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GREAM ENTERPRISES, INC.

DBA PHENOS HAYWARD

CONDITIONAL USE PERMIT APPLICATION

PROJECT NARRATIVE
CUP APP# P25-XXXX

PROPERTY
ADDRESS:
21463 Foothill Blvd. Suite A
Hayward, CA 94541
APN: 414-008-656
ZONING: General Commercial
BUSINESS OWNER: Gream Enterprises, Inc.

PROPERTY OWNER: Foothill-Grove LLC

PROJECT OVERVIEW
Gream Enterprises, Inc. DBA Phenos Hayward (hereafter referred to as “Phenos'') has proposed to provide interior improvements to the existing structure on site to secure and accommodate a commercial cannabis retail facility with applicant to obtain a Type 10 Retailer License from the Department of Cannabis Control upon approval by City of Hayward. The subject site is located at the above address within the City of Hayward in the General Commercial (CG) Zone with a General Plan land use designation of Commercial High Density Residential (CHDR).

NUMBER OF EMPLOYEES (FULL TIME):
● Retail Fourteen-Twenty (14-20)
● (Specific Roles/Budtenders/Managers Etc.

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HOURS OF OPERATION:

The hours during which the retail premises will be open to the public shall be 9:00 a.m. to 8:00 p.m., seven days a week, Monday through Sunday.

RETAIL CUSTOMER TRAFFIC:
500-700 Customers per Day (Anticipated to increase to 900 daily following ) RETAIL EMPLOYEE SHIFTS:

Monday through Sunday
● Shift I: 8:45 a.m. to 1:45p.m. (3+ Employees, including Management) ● Shift II: 1:45p.m. to 6pm (3+ Employees, including Management) ● Shift III: 4:00 p.m. to 9 p.m. (3+ Employees, including Management) IRONCLAD PRODUCT RECEIVING PROCEDURES /DELIVERIES:
● We have established an exclusive distribution partnership within our network of cannabis businesses, specifically with Pacafi, Inc., operating under the name PCF Distro. To ensure timely delivery and preparedness, we have scheduled one/two deliveries per week from Monday through Friday. Our exclusive distribution partnership allows us to reduce vendor deliveries from twenty per day to one/two per week, minimizing security risks.
● Our retail general managers and armed security guards have direct communication with the logistics manager at PCF Distro to confirm delivery times and coordinate logistics to ensure top-level security. Upon arrival, PCF Distro is greeted by our armed security personnel and directed to . All visitors and
vendors are required to be logged on the Visitor Log, in compliance with DCC regulations. Each visitor/ delivery is recorded with the date, name, time in/out, reason for business, and company by our armed security personnel. ● The distributor employee with cannabis products is escorted by an armed guard The loading/ unloading area, doorway, intake area, and storage room are

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monitored and recorded 24 hours per day by our video surveillance system, with footage stored for a minimum of 90 days. At all times and in real time, security can communicate with store managers via headsets.
● To maintain confidentiality, delivery arrival times and dates are kept to upper level management only.

CUSTOMER/ VENDOR/ MAINTANCE CONTRACTORS ACCESS:
● Customers: Individuals shall be granted access to the retail area to purchase cannabis goods only after the employee of the retailer or armed security staff has confirmed the individual’s age and identity. Individuals must show their government-issued identification, if applicable their physician’s recommendation, and/or a State issued (MMIC) cannabis card.
● All others: (Vendors / Contractors / Repairman / Pest Control etc.) All individuals are verified by our armed security staff and management to have a confirmed scheduled appointment. After verification of identity each visitor is recorded with the date, name, time in/out, reason for business, and company by our armed security personnel. Visitors are accompanied by staff or security guards at all times.

SITE OVERVIEW

AREA BREAKDOWN
Gross Site Area: 1.33 Acres
Existing Structure: 14,928 sq. ft.

Floor Area Ratio (Far): Total: 26%

PARKING ANALYSIS
There are sixty-one (61) parking spaces in the immediate vicinity of the premises with twenty-six (26) spaces located directly in front of the storefront.

Although the parking area is shared with two tenants comprising the shopping center's tenant's, PHENOS anticipates regular availability of at least fifty (3=50) parking spaces throughout the day, at any given time during its operating hours.

At a maximum of three (3) employees on site during normal daily operations, with sixty one (61) parking spaces available at the CG Zoned facility, PHENOS will have ample parking to accommodate its needs as under the Hayward Municipal Code.

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RETAIL OPERATIONS

FACILITY LAYOUT AND LOGISTICS
Lobby/Security Checkpoint and Customer Access
The Security checkpoint will serve as the sole entrance point for customers and visitors arriving at Phenos Retail Facility. This feature consists of a 'Check In' Window at which customers will be greeted upon entry from the 'Customer Entrance' on the east side of the facility. During retail operating hours as customers are entering and exiting the facility, the Security Manager will be stationed within the lobby area outside of the 'Check In' Window. The Security Manager shall monitor customer and employee movement including access into the interior of the Retail Area after customers check in, and shall ensure secure, compartmentalized access to the Retail Area which shall serve as a deterrent to any potential criminal activity or threat to customers, employees, or visitors at the store. Additionally, one state licensed, uniformed, armed, and badged security guard, shall be in constant communication with the Security Manager and available to respond to any exigency on site.

Manager's Office
The Manager's Office will serve as the central location for Management. It will also house the facility's administrative security monitors, as well as physical record storage required under Hayward's Municipal Code.

These records shall be maintained by Phenos for a period of seven (7) years and shall be made available to the Hayward Police Department upon request, except for private patient records which shall be made available only pursuant to a properly executed search warrant, or court order. In addition to all other formats that Phenos may maintain, these records shall be stored or produced on location in a printed format upon request.

Any loss, damage or destruction of the records shall be reported to Hayward Police Department within 24 hours of the loss, destruction, or damage.

Retail Sales Floor
● The Retail Sales Floor Area will provide an upbeat welcoming atmosphere to enhance the customer experience. The traffic flow inside the facility will not exceed the maximum capacity, the size of the retail floor shall provide comfortable accommodation for the anticipated volume of customers patronizing the store at any given time. ● Once the customer’s credentials, including their age and ID are verified, the receptionist at the ‘Check-In’ window will complete the guest intake process and do the following:
● When a new patient or customer is visiting for the first time the following occurs:
● Create a NEW customer profile utilizing Indica Online (Point of Sale (POS) software system).
● Enter the guest’s name, date of birth date and ID information into the appropriate data fields

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● Save the profile (for future use) and click “check in” to enter the person’s name into the queue. Proceed to inform the guest about the daily limits on products ● The customer will then proceed from the ''Check-In" window to the retail sales floor entry door and be 'buzzed-in' by the receptionist to commence their shopping experience ● When a receptionist checks in a returning guest, the following occurs:
● The returning customer is asked for ID to verify their physical appearance vs information on their ID
● Receptionist locates the guest’s profile in the POS system, selects “check-in” ● Once the profile is displayed and verified “Check-in” is complete ● Customers are “buzzed in” to be welcomed on the retail sales floor to begin their selections for purchase.
● Once the customer reaches the Retail Sales Room, the sale of products commences. ● The following will occur during the Phenos Customer Experience:
● Positive interfacing with sales staff will always be geared toward friendliness and courtesy
● The Retail Clerks also known as 'budtenders' and additional management staff will advise the customers on the products and extensive selection we carry.

GOODS FOR SALE AND CUSTOMER TRANSACTIONS
Goods for Sale
PHENOS shall not make any cannabis goods available for sale to a customer unless such goods were received from a licensed distributor, have not exceeded their expiration or sell-by date if one is provided, and, for manufactured cannabis goods, PHENOS shall ensure the product complies with all requirements of California Business and Professions Code Section 26130 and all other relevant laws.

Goods on Display in Retail Area
Goods for inspection and sale shall only be displayed in the Retail Sales Floor and shall not be visible from outside or from other areas of the facility.

All cannabis sold to customers will be packaged and labeled in accordance with Division 10 of the California Business and Professions Code. No free samples of cannabis will be provided.

Live Plants
Phenos will not sell or store live plants/ clones.

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Daily Product Limits
● Recreational Use: Phenos shall not sell more than 28.5 grams of non-concentrated cannabis to a Customer in a single day to a single customer ● Phenos shall not sell more than eight (8) grams of concentrated cannabis, including that which is contained in cannabis goods, in a single day to a single customer ● Medical Use: Phenos shall not sell more than 8oz of cannabis in any form to a medical use patient in a single day to a single customer
● Phenos shall utilize Indica Online (POS System) daily purchasing limits feature which tracks every purchase and records sold daily limits. It is not possible to “oversell” a customer, Indica Online does not allow a user to complete an order that is over the daily limits set forth by the State of California. There is no Manager-Override option and our system simply does not allow it.

CANNABIS PRODUCT REGISTER PROCEDURES
Once the customer has completed their shopping experience, the budtender will accept payment and hand the customer the purchased product in an opaque package with receipt attached, along with any change due to the customer.
● Each product will be labeled uniquely by bar code and correlating ID associated within the tracking system. The bar code will be scanned into the data field to ensure the correct information for each product is being recorded
● All inventory is recorded and tracked in the POS system to properly monitor in real time the movement of product throughout the facility through the final sale. ● Budtenders shall ensure all discounts have been applied correctly by reviewing the price of the order and the discounts notes as well as relaying any promotional information to the consumer
● Budtenders shall count all cash in front of the customer to ensure accuracy and accountability as well as for video recordings

CUSTOMER EXIT
● Once a purchase has been completed, departing customers shall exit the facility through the exit door
● Security guards will observe parking lot activities to ensure on-site consumption does not take place.

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EXTERIOR FLOW OF CUSTOMERS
This location has 60+ off street parking spaces available to customers, employees and visitors at any given time.

CUSTOMER RETURNS
Phenos will accept returns on manufactured products within 7 days of purchase. Returns shall be “Returned” in the POS System, held in a separate “Returns” inventory category until cleared for destruction, all returns will be accounted for in inventory as well as METRC while onsite.

BULK CANNABIS STORAGE

MANAGER OFFICE
The Manager Office shall serve as the central location for security coordination, monitoring, and logistics. It will house the facility's security network infrastructure, including surveillance monitors with access to all security camera viewpoints which will be under the constant supervision of management personnel during all hours of operation. The Manager shall have master control

ODOR CONTROL PLAN

AIR TREATMENT PROCEDURES
PHENOS’s Facility has been designed for the operation of Commercial Cannabis Retail business, which does not include the production of cannabis nor any exposure of unpackaged cannabis to the exterior environment as all cannabis to be stored and sold on site shall arrive within sealed, child resistant mylar bags, and glass jars, which shall remain closed through sale to customers.

The odor control and reduction system will include carbon filtered air intake exchanges, a commercial heating, ventilation, and air conditioning (HVAC) air ventilation system, and airtight packaging for all products on site.

OPERATIONAL PROCESSES AND MAINTENANCE PLAN
PHENOS’s Operations Manager(s) will monitor and replace carbon filters within the facility's air intake exchanges per the manufacturer’s instructions or as needed, to ensure optimal performance.

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Once the Odor Control Mitigation Plan is fully approved and implemented, the Operations Manager will inspect the interior and exterior of the facility to evaluate the efficiency of odor control measures. Periodic odor testing will also be performed to both establish a baseline and to monitor mitigation efforts.

HVAC System: In addition to carbon filters, PHENOS will augment the facilities filtered ceiling ventilation hatches to remediate odors, achieve temperature balance and to maintain air flow.

PHENOS may increase the number of air exchanges in the facility. The average HVAC system in a cannabis business has an average of ten to eighteen air exchanges per hour. PHENOS will use a formula to determine the appropriate number of air exchanges necessary to scrub the air of unwanted odor. PHENOS has devised the following formula Cubic Feet of Room Space % 3 = Cubic Feet per Minute (CFM) of airflow necessary. Additional air exchanges increase the odor removal system as air passes through filters more often before being recirculated. Air exchanges also offer the added benefits of maintaining appropriate levels of humidity.

Insulation: PHENOS’ facility shall be properly sealed and insulated. In addition, the Operations Manager will ensure mechanical, and ventilation systems are up-to-date and operating properly through daily inspections.

Additional Solutions: PHENOS will utilize air-tight packaging to limit odor. Purchased cannabis product shall arrive at and leave from PHENOS’s facility in sealed tamper-evident, odor-locking package. Further, any cannabis products considered as waste will be mixed with soil and ground to a uniform mixture until the cannabis waste is undiscernible from its original form.

PHENOS believes these measures coupled with proactive maintenance will sufficiently eliminate odors that would otherwise emanate from the cannabis facility. In the unlikely event that these steps are not enough to mitigate odors, PHENOS is prepared to modify their Odor Control Plan and take additional action based on community and state recommendations.

Government Documentation: In accordance with the State of California, PHENOS will provide copies of its records upon request. Records will include but will not be limited to the original Odor Control Plan, any changes/updates to the Odor Control Plan, maintenance, malfunctions, installations, and community complaints. If any renovations or modifications are made to the cannabis facility that modify the control of odor, PHENOS will submit an updated Odor Control Plan within 30 days of the modifications/renovation to City of Hayward.

INVENTORY CONTROL
In addition to utilizing Metrc (CA Track & Trace) for purposes of tracking and reporting commercial cannabis inventory and transactions as required by the State, Phenos will use Indica Online for in-house inventory control and reporting system (POS System). that accurately documents the present location, amounts, and descriptions of all cannabis and cannabis products present on site, through their purchase, as set forth under MAUCRSA.

Page 9 of 16 ends

Phenos shall maintain Accounting software (Quickbooks) and records in an electronic format detailing all revenues and expenses of the business, as well as its assets and liabilities. Such records will include monthly statements detailing the number of sales, including gross receipts for each month and all applicable taxes paid or due to be paid. Such records shall also demonstrate that all cannabis or cannabis products have been obtained from other locally and State licensed cannabis operations.

Sales and Invoicing: Phenos shall provide customers with a sales receipt for every purchase.

Reporting and Tracking of Product and of Gross Sales: Phenos shall utilize Indica Online (POS System) inventory management and tracking system to track and report all sales. Indica Online shall with METRC (CA Track & Trace) all transactions.

RECORD KEEPING
Phenos will maintain the following records on premises including but not limited to:

1. All Retail Permits, State license and required signage by DCC

2. Retail Operating Procedures including SOPs

3. All records evidencing compliance with environmental protection measures

4. All supporting documentation for data or information input into the track-and-trace system

5. All unique identifiers (UID's) assigned to products in inventory.

6. Financial records including but not limited to bank statements, tax records, sales invoices, and sales receipts

7. Personnel records, including each employee's full name, social security, or tax ID number, date of beginning employment, and date of termination of employment where applicable

8. Records related to employee training for the track and trace system including the date(s) training occurred, description of the training provided, and the names of the employees that received the training

9. Contracts with other state licensed cannabis businesses

10. Security Records

11. Records associated with the disposal of cannabis waste

12. Documentation associated with any loss of access to the track-and-trace system

Page 10 of 16 ends

SAFETY AND SECURITY PLAN

SAFETY PLAN
Emergency Numbers and Notifications
In the event of an emergency, PHENOS Personnel shall be trained to call 911 as soon as possible from a safe location. Security and key personnel will assist until police, fire, or medical responders arrive.

Emergency Training and protocol will include a directive for the following information to be provided to on-site security or emergency dispatch in the event of an emergency:
● Nature of the emergency
● Assistance needed
● Name of the caller and telephone number from which the call was made ● PHENOS name, and precise location on site from which the call was made Contact:
● Direct line to on-site security: TBD
● California Highway Patrol (non-emergency): (510) 489-1500 ● Hayward PD: 911
● Hayward Fire Department: 911
Example:
● "This is an emergency." (Describe nature of emergency) ● "I need (ambulance/police/fire) assistance"
● "I a.m. at PHENOS Facility located at 21463 Foothill Blvd. Suite A in Hayward" ● "I a.m. in (room or office area)"

FIRE PREVENTION AND SUPPRESSION
Based on the nature of the proposed use for retail operations, the primary potential fire hazard would be the same as any other retail establishment. The risk of this occurring is minimal.

Nonetheless, to protect against this potential hazard, the entire facility will be equipped with fire extinguishers mounted according to code.

In the event of a fire, PHENOS personnel shall be trained to:

Page 11 of 16 ends

1. ALERT others on the floor by activating a manual fire alarm pull station and direct others to begin immediate evacuation.

2. REPORT the fire to 911 and PHENOS Management at (209) 595-2884 as soon as possible from a safe location.

3. ATTEMPT TO EXTINGUISH the fire only if trained and feel comfortable doing so.

Do not attempt to extinguish a fire which is larger than a trash can. Always leave yourself a good escape route from the area while attempting to extinguish the fire. If the fire cannot be safely and quickly contained, leave the area immediately and close all doors behind you as you exit.

4. EVACUATION: During business hours, security and key personnel will assist with a quick and orderly evacuation, search the facility, and assist disabled vendors and staff members. Proceed to the parking lot which will serve as the designated evacuation area.

Treat all alarms as an emergency.

Once outside of the building, stay clear of the structure to avoid falling glass, or flaming ash and debris emanating from the fire.

If you must move through smoke, heat, and fumes, drop to your hands and knees, take short breaths through your nose, and crawl to an escape exit by staying in contact with an outside wall. Following an outside wall will lead to an exit. The air will be best near the floor since the heat, fumes, and smoke rises.

Do not open hot doors! Feel doors at the top, the door handle or frame with the back of your hand before opening. If the door is hot, don't open it! If the door is cool, open the door slowly and stay behind the door, ready to close it if necessary. Close the door immediately after entering or exiting.

5. ISOLATE the fire by closing all doors behind you as you exit.

6. AUTHORITY in a fire or other emergency rests with the Hayward and Stanislaus County Fire Departments and other emergency responders, and with PHENOS Management.

HAZARDOUS MATERIALS SPILL
In the event of hazardous materials incident PHENOS personnel shall be trained to:

1. REMAIN CALM

2. IMMEDIATELY EXIT THE AREA

3. DO NOT ALLOW OTHERS INTO THE AREA. Do not attempt to contain or clean up the spill unless you have been trained and have all proper safety, disposal, and personal protective equipment.

Page 12 of 16 ends

4. NOTIFY SECURITY. Give as much detailed information as you can about the nature of the spill. Security will call California Poison Control Authorities at 1-800-222-1222.

5. REFER to Material Safety Data Sheet (MSDS) if possible.

6. FOLLOW INSTRUCTIONS of Fire Department personnel and/or Security/PHENOS Management when they arrive.

MEDICAL EMERGENCY
In the event of a medical emergency PHENOS personnel shall be trained to:

Remember that it is best to err on the side of caution. If a person is experiencing significant distress, call for professional assistance immediately.

Call 911. Give the following information:

1. Nature of medical emergency

2. Exact location and name of sick or injured person and age

3. What type of assistance is needed or is being provided

4. Your name and contact phone number

5. Stay on the phone until the dispatcher has all the information needed and releases the call

6. Ambulance should arrive at 21463 Foothill Blvd. Suite A Hayward, CA 95210 Radio Security Staff. Alert Security to be on the lookout for emergency responders to follow up with as necessary to arrange to escort paramedics to your location.

Notify a Supervisor. General Managers and/ or Assistant Managers trained in CPR and First Aid will assist until emergency responders arrive. Take all reasonable precautions to prevent disease transmission.

Assign someone (typically Security) to wait at the facility entrance to assist responding medical personnel in finding the location of person(s) needing medical attention.

Do not move victims if you suspect back or neck injuries. Assess victims for airway, breathing, circulation, and possible injuries before administering any sort of aid. Keep the person warm and comfortable. You should also offer to call a family member or friend for assistance/support, or notification.

WORKPLACE VIOLENCE
In the event of a violent incident in the workplace or threat to personal safety or the safety of another person PHENOS personnel shall be trained to:

Call 911.

Page 13 of 16 ends

Relay All Known Information: Exact location, nature of the situation, brief description of subject(s) involved, injuries. Stay on the phone until the dispatcher releases you.

Use Common Sense to safeguard yourself and others; do not engage in unnecessary attempts at intervention.

EARTHQUAKE
In the event of an earthquake:
● Drop, Cover and Hold! Get under a sturdy structure such as a desk or workstation and remain there until the earthquake subsides. In a hallway, kneel with your back against the wall. Cover your head with your arms and tuck down to your knees. ● Keep as calm as possible.
● If inside, stay inside. If outside, stay in the open, away from the building, overhead power lines, or any other objects at risk of falling. Do not rush to the exits ● Keep away from windows or objects that are likely to fall ● Stay under cover until it appears the earthquake is over. Be prepared for aftershocks ● Report any damage/injuries to emergency responders by calling 911 as soon as possible.

Notify PHENOS Management. Give whatever assistance you can to injured or disabled people. Use common sense and keep safety as a top priority when attempting to search and rescue
● Follow instructions given from emergency personnel

BOMB THREAT
In the event of a bomb threat PHENOS personnel shall be trained to:

Assume that any bomb threat is a real danger to occupants and property. Be calm and courteous.

Listen and do not interrupt the caller. If possible, ask someone else to notify security while the caller is on the line. If a device is spotted a runner should be sent to notify security immediately.

Questions to ask if possible:
● When is the bomb going to explode?
● Where is it right now?
● What does it look like?
● What kind of bomb is it?
● What will cause it to explode?
● Did you place the bomb?

Page 14 of 16 ends

● Why?
● What is your name?
Take Note of:
● Whether the callers voice is male/female, age approximation ● Tone of voice and language used
● Background noises
● Any other remarks
Carefully make a visual survey of your immediate working space. If you see/hear anything unusual, DO NOT TOUCH; report it to security immediately. Follow any instructions for evacuation by security, or emergency responders.

BLACKOUTS
In the event of a blackout PHENOS personnel shall be trained to:

Emergency location: Security and/or Management will evacuate the building calmly and safely to the evacuation location (parking lot)
Accessibility issues: Plan for accommodating employees who have limited mobility to ensure they will be able to move about or relocate their workspace to an area where risk can be avoided.

Protection of equipment: Turn off power supplies, surge protectors, power strips etcetera to protect electronic equipment when the electricity is turned back on.

Emergency Backup: Ensure that any backup generator sources are tested and readily available to power critical equipment. In the case of battery-operated devices, batteries should be checked and fully charged.

Contact lists: Ensure that your agency or department's phone trees are current and that a complete and continuously updated list of emergency contacts is distributed, as appropriate.

SECURITY PLAN

LOGISTICS AND OPERATIONAL SECURITY MEASURES
Except for the retail storefront accessible to the public from the northeast side of the facility and its adjacent customer parking lot, there shall be no public access to the facility.

VALUE TRANSFER AREA

Page 15 of 16 ends

shall allow logistics personnel to
securely access the facility prior to engaging in transactions involving the transfer of product or currency which is described in further detail below.

SECURITY PERSONNEL AND INFRASTRUCTURE
At least one armed Security Guard shall be present at the facility 24 hours per day, with two armed guards present during retail hours. The entire exterior and interior of the facility, except for the Manager's Office and restrooms, shall remain under the constant monitoring of security personnel as well as camera surveillance systems.

The Security Staff shall be responsible for monitoring and maintaining facility perimeter security, facilitating access for customers, employees, vendors, and visitors to the facility, preventing loitering, and serving as a deterrent to any unlawful or threatening activity on site.

SURVEILLANCE CAMERA SPECIFICATIONS
The facility’s exterior and interior surveillance cameras will have a resolution of 8MP 4K resolution capable of facial recognition capture and comparison with high quality footage in dark or low light, providing alerts to PHENOS Security Managers and Executives upon detection of significant objects, movement, loud noises, or events concerning site security. The surveillance cameras shall also be equipped with ‘Smart Search’ and remote-control capability.

The surveillance cameras shall also be capable of live monitoring by PHENOS Security Manager via mobile device, offering continuous 24/7 recording. Footage shall be kept and stored for a minimum of 90 days via 14TB Capacity hard drive and internet cloud storage, which shall be easily exportable via USB drive.

A licensed Security Firm shall also be contracted to provide a burglar The surveillance feeds and footage shall be accessible to the Operations Manager, PHENOS Executives, and Hayward Police Department upon request.

TRANSACTIONAL SECURITY

CURRENCY SECURITY
Currency transfers from the facility will be conducted at random time intervals, with transporters using varying routes to and from the facility. Access in and out of the facility for Currency Transfers will be facilitated through collaboration between the Operations Manager, Armored Transport Courier, and Security staff.

Receipt of Shipment of Cannabis Goods
Entry into the premises will be facilitated by the Operations Manager and Security staff. Such transactions will take place by appointment only.

Following verification of identification and credentials by the Security staff, Distribution driver(s) will be directed . The

Page 16 of 16 ends

courier shall then be escorted
The distribution shipment shall then be verified against the purchase order and electronic manifest related to the transaction by the Operations Manager.

Following verification of the shipment, the cannabis product will be transferred by the General Manager into the to be securely stored and locked. The Premises will be monitored by exterior surveillance and cameras accessible to the Operations Manager and PHENOS Executives.

Currency Transfers
Currency will be transferred off-site at irregular intervals, with notification of such transfers only to the Operations Manager, Armored Couriers, security staff, and PHENOS Executives.

Upon a transfer of currency off-site, after verification of credentials and access to the facility being granted by security staff, the armored courtier will be directed which shall immediately be closed and locked once the courier enters. The Operations Manager will then transfer currency from the to be transported off site.

These currency transfers shall be coordinated for banking deposits at Fresno First Bank.

Security Liaison
We have named Tasha Parra (“Security Agent” or “Security Liaison”) as the agent in charge of security. Primary phone number: (209) 969-9000; Email: [email protected] A0.0
X
A.L.P
N.T.S.

DRAWN BY
DATE
SCALE
SHEET

SHEET OF

P Q D E S I G N
2425 LA FRANCE STREET
SAN DIEGO, CALIFORNIA 92109
TELEPHONE : 1-858-527-0818
C 2025, PQ DESIGN STUDIO. ALL
RIGHTS RESERVED. THESE PLANS MAY

NOT BE REPRODUCED WITHOUT THE

PRIOR WRITTEN CONSENT OF PQ
DESIGN STUDIO INC. INTELLECTUAL

PROPERTY RIGHTS FOR THIS

DOCUMENT(S) ARE SOLELY MAINTAINED
BY PQ DESIGN STUDIO INC.

S T U D I O I N C PLAN REVISIONS & C.O.'S PROJECT INFORMATION ADDRESS A.P.N. LEGAL ZONING ABC
D
E
FG
H
IJ BLD. TYP. / OC.

BLDG. DEPT. PLN. CHK
NORTH XXXXXXXXXX GREAM ENTERPRISES INC. XXXXXXXXXX 21463 FOOTHILL BLVD. 414-0086-056-02 SEE TITLE SHEET CG - GEN. COMM. M/B V-B INTERIOR TENANT IMPROVEMENT XXX
06-12-2025

SUBJECT TENANT SPACE
PROPERTY LINE 289.74'
PROPERTY LINE 248.60' PROPERTY LINE 167.73' PROPERTY LINE 171.05'

31.16' R=20' 31.54' R=30'

EXISTING ACCESSIBLE PARKING
SIGNAGE COMPLYING WITH CBC 11B-208.1

EXISTING UNLOADING
ZONE

EXISTING

ACCESSIBLE

PARKING SPACE

EXISTING

ACCESSIBLE

VAN PARKING
SPACE

SITE / ZONING INFORMATION
SITE ADDRESS 21463 FOOTHILL BLVD. , HAYWARD CA 94541
SITE PARCEL NUMBER 414-0086-056-02
SITE AREA 1.33 AC.

BASE ZONE CG
GEN. PLAN LAND USE COMMERCIAL/ HIGH DENSITY RES.

TOT. # E. PARKING SPACES 61 TOTAL. (2 OF WHICH ARE ACCESSIBLE) (12) SPACES
(7) SPACES
(12) SPACES
(3) SPACES
(12) SPACES
(15) SPACES
E. HYDRANT

LOCATION
E. HYDRANT LOCATION

SITE PLAN

CUP SET -NOT FOR CONSTRUCTION
#CUP-25-0011

BUILDING INFORMATION

BUILDING TYPE VB - FS
SPRINKLER TYPE NFPA 13
GROSS FLOOR AREA 21,833 SQ.FT.

No. OF STORIES 1-STORY ABV. GRADE
E. OCCUPANCIES B/M/S1
LOCATION OF E.

TRASH ENCLOSURE
SEE A2.0 FOR DETAILS
414-0086-057-00
(15) SPACES UTILIZED BY
SUBJECT CUP APPLICANT SPACE PROPERTY LINE 50.00' PROPERTY LINE 50.00' PROPERTY LINE 150.00'
PROPERTY LINE 150.00'
S
S
S
S
S
S
S
S
S
S
S
S

TRASH ENCLOSURE

DRAIN CONNECTED

TO SANITARY
SEWER. LATERAL

TO VERIFIED IN
FIELD.

Attachment IV

EXISTING FLOOR PLAN
A1.0 X
A.L.P
1/8" = 1'-0"

DRAWN BY
DATE
SCALE
SHEET

SHEET OF

P Q D E S I G N
2425 LA FRANCE STREET
SAN DIEGO, CALIFORNIA 92109
TELEPHONE : 1-858-527-0818
C 2025, PQ DESIGN STUDIO. ALL
RIGHTS RESERVED. THESE PLANS MAY

NOT BE REPRODUCED WITHOUT THE

PRIOR WRITTEN CONSENT OF PQ
DESIGN STUDIO INC. INTELLECTUAL

PROPERTY RIGHTS FOR THIS

DOCUMENT(S) ARE SOLELY MAINTAINED
BY PQ DESIGN STUDIO INC.

S T U D I O I N C PLAN REVISIONS & C.O.'S PROJECT INFORMATION ADDRESS A.P.N. LEGAL ZONING ABCDE FGHIJ BLD. TYP. / OC.

BLDG. DEPT. PLN. CHK XXXXXXXXXX GREAM ENTERPRISES INC. XXXXXXXXXX 21463 FOOTHILL BLVD. 414-0086-056-02 SEE TITLE SHEET CG - GEN. COMM. M/B V-B INTERIOR TENANT IMPROVEMENT XXX
06-12-2025
E. RETAIL
E. CVRD. ENTRY
E. CVRD. ENTRY

CUP SET -NOT FOR CONSTRUCTION

NEW FLOOR PLAN
A2.0
X
A.L.P
1/8" = 1'-0"

DRAWN BY
DATE
SCALE
SHEET

SHEET OF

P Q D E S I G N
2425 LA FRANCE STREET
SAN DIEGO, CALIFORNIA 92109
TELEPHONE : 1-858-527-0818
C 2025, PQ DESIGN STUDIO. ALL
RIGHTS RESERVED. THESE PLANS MAY

NOT BE REPRODUCED WITHOUT THE

PRIOR WRITTEN CONSENT OF PQ
DESIGN STUDIO INC. INTELLECTUAL

PROPERTY RIGHTS FOR THIS

DOCUMENT(S) ARE SOLELY MAINTAINED
BY PQ DESIGN STUDIO INC.

S T U D I O I N C PLAN REVISIONS & C.O.'S PROJECT INFORMATION ADDRESS A.P.N. LEGAL ZONING ABC
D
E
FG
H
I
J BLD. TYP. / OC.

BLDG. DEPT. PLN. CHK XXXXXXXXXX GREAM ENTERPRISES INC. XXXXXXXXXX 21463 FOOTHILL BLVD. 414-0086-056-02 SEE TITLE SHEET CG - GEN. COMM. M/B V-B INTERIOR TENANT IMPROVEMENT XXX
06-12-2025

DISPENSARY
E.

TRASH
ENCLSR.

E. CVRD ENTRY

M-OCCUPANCY

1.01 1.01

1.02 1.03

1.04 1.05

1.06 1.07

1.08 1.09

1.10 1.11

1.12 1.13

1.14 1.15

1.16 1.02

1.03 1.17
3'-2 1/2"
17'-4 1/2" 9'-2 1/2" 43'-1" 3'-1" 22'-11"
98'-10 3/4" IN TO IN SUBJECT TENANT SPACE
13'-3 3/4" 8'-10" 45'-10" 38'-1 3/4"
106'-1 1/2" IN TO IN SUBJECT TENANT SPACE
32'-0"
11'-11" 11'-11" 4'-0"
2'-10 1/2"
43'-8 1/4" 13'-3 3/4" 6'-2" 30'-9 3/4" 17'-8" 16'-0" 19'-3 1/2" 7'-8 3/4" 7'-11 3/4" 7'-2 1/2" 26'-4" 6'-5" 28'-9 3/4" 8'-9 1/4" 9'-1 3/4" 24'-6" 14'-8" 2'-3 1/2" 7'-11 3/4" 963'-1 1/4"
76'-0 3/4"
1'-9 3/4"
17'-2"
1'-10"
17'-1 3/4"
1'-10"
17'-1 3/4"
1'-10"
17'-1 3/4"
1'-10"
10'-0 1/2" 16'-3 1/2" 25'-9 3/4" 2'-2 3/4"
N. OVERHEAD 22Ga.

STEEL ROLL UP
SECURITY DOOR ABV.

CUP SET -NOT FOR CONSTRUCTION
RETAIL

M-OCCUPANCY

RCPT/ SCRTY

M-OCCUPANCY
11'-2"
20'-0"
E. TRASH ENCLOSURE - FRONT ELEV.

SCALE 1/4" = 1'-0" 1
E. TRASH ENCLOSURE - REAR ELEV.

SCALE 1/4" = 1'-0" 2
E. TRASH ENCLOSURE - RIGHT ELEV.

SCALE 1/4" = 1'-0" 3
E. TRASH ENCLOSURE - RIGHT ELEV.

SCALE 1/4" = 1'-0" 4 8'-0"
E. CYCLONE FENCE ROOF w/

INFILL SLATS
E. METAL BAR GRATING
E. METAL GATE(S) w/ LOCKING HRDWR.

E. SPLIT FACE CMU WALL(S)
E. SPLIT FACE CMU WALL(S)
E. CONC. STEPS TO E. LOADING PLATFORM
E. SPLIT FACE CMU WALL(S)
E. SPLIT FACE CMU WALL(S)
E. TUB STEEL

GUARDRAIL
E. LOADING PLATFORM

BULKHEAD WALL
8'-0"
8'-0" 8'-0"
32GAL. ORGANIC
TOTER
2 YARD

COMMERICAL
4 YARD

RECYCLE

RECEPTION/

SECURITY
DESK
../../../../../DETAILS/BLOCKS/SYMBOLS/free-vector-fire-extinguisher-sign-clip-art_113710_Fire_Extinguisher_Sign_clip_art_medium.png LOCATION OF WALL MOUNTED FIRE EXTINGUISHER CLASS 'A' , SIZE 2A, 10BC. LOCATION BETWEEN TO BE 75' MAX

DO NOT INSTALL ANY FURNITURE OR OTHER OBSTRUCTIONS

IN FRONT OF EXTINGUISHER LOCATION
../../../../../DETAILS/BLOCKS/SYMBOLS/free-vector-fire-extinguisher-sign-clip-art_113710_Fire_Extinguisher_Sign_clip_art_medium.png ../../../../../DETAILS/BLOCKS/SYMBOLS/free-vector-fire-extinguisher-sign-clip-art_113710_Fire_Extinguisher_Sign_clip_art_medium.png ../../../../../DETAILS/BLOCKS/SYMBOLS/free-vector-fire-extinguisher-sign-clip-art_113710_Fire_Extinguisher_Sign_clip_art_medium.png

TYPICAL STORAGE RACKS
-

EGRESS PLAN - CAMERA PLAN
A2.0x X
A.L.P
1/4" = 1'-0"

DRAWN BY
DATE
SCALE
SHEET

SHEET OF

P Q D E S I G N
2425 LA FRANCE STREET
SAN DIEGO, CALIFORNIA 92109
TELEPHONE : 1-858-527-0818
C 2025, PQ DESIGN STUDIO. ALL
RIGHTS RESERVED. THESE PLANS MAY

NOT BE REPRODUCED WITHOUT THE

PRIOR WRITTEN CONSENT OF PQ
DESIGN STUDIO INC. INTELLECTUAL

PROPERTY RIGHTS FOR THIS

DOCUMENT(S) ARE SOLELY MAINTAINED
BY PQ DESIGN STUDIO INC.

S T U D I O I N C PLAN REVISIONS & C.O.'S PROJECT INFORMATION ADDRESS A.P.N. LEGAL ZONING ABCDE FGHIJ BLD. TYP. / OC.

BUILDING TYPE

ROOM NAME
E. WOMEN'S BATHRM.

FLOOR AREA LOAD RATIO OCCUPANTS
RETAIL AREA 1,200 SQ. FT. 8
DISPENSARY 2,628 SQ.FT. 1 / 60 442
TOTAL 106 OCCUPANTS
1/150
92 SQ. FT. 1/50
RECEPTION DESK 200 SQ. FT. 1/150 1

OCCUPANCY CALCULATION
E. WAREHOUSE 3,447 SQ.FT. 1/300
PRODUCT STORAFGE 1,078 SQ. FT. 1/300 4
12 MNGR. OFFICE 873 SQ. FT. 1/150 6
E. MEN'S BATHRM. 94 SQ. FT. 1/50 2
I.T. ROOM 87 SQ. FT. 1/300 0 M V-B MMBBBB
S1
N. WAREHOUSE S1 3,644 SQ.FT. 1/300 12
MAX TRAVEL DIST. 128'
MAX ALLOWED DIST. 250'
PER TABLE 1017.2 B/M/S1
OCCUPANCY. w/

SPRINKLER SYSTEM

DISPENSARY
S1-OCCUPANCY
RETAIL

RCPT/ SCRTY

M-OCCUPANCY
S1
BREAK ROOM S1 200 SQ.FT. 1/15 13
E. STORAGE ROOM S1 483 SQ. FT. 1/300 1
E. BATH 1 B 58 SQ. FT. SINGLE SERVE 1
1-OCCUPANT
44-OCCUPANTS
6-OCCUPANTS
4-OCCUPANTS
13-OCCUPANTS
2-OCCUPANTS
2-OCCUPANTS

EXIT REQ'S
6 OCCUPANTS

1.2" REQ'D WIDTH
36" PROVIDED

EXIT REQ'S
53 OCCUPANTS

10.6" REQ'D WIDTH
36" PROVIDED

EXIT REQ'S
35 OCCUPANTS

7.0" REQ'D WIDTH
36" PROVIDED

EXIT REQ'S
6 OCCUPANTS

1.2" REQ'D WIDTH
36" PROVIDED

EXIT REQ'S
6 OCCUPANTS

1.2" REQ'D WIDTH
36" PROVIDED
EXIT
EXIT
EXIT
EXIT
EXIT
EXIT
128' MAX PATH OF TRAVEL

CUP SET -NOT FOR CONSTRUCTION

CAMERA PLAN
SCALE N.T.S.

From: Mike Uchida
To: Steve Kowalski
Subject: UP-25-0011 CUP
Date: Saturday, May 3, 2025 11:01:22 AM
CAUTION:This is an external email. Do not click on links or open attachments unless you know the content is safe.

I’m writing in response to the “Notice of Receipt of Application” for 21463 Foothill Blvd.

As a business owner since 1971, it’s disturbing to think that a cannabis dispensary is opening in what was once a Lucky, C. Markus Hardware, and now a failed Drugstore. Please don’t turn this property into another drugstore.

First off, there is a marital arts studio nearby which caters to children. This corner is also has pedestrian traffic from local schools.

The Garden of Eden is up the street. How many more weed shops does Hayward need? I get it, you need the tax money but can you do better.

I adamantly oppose a cannabis dispensary opening at 21463 Foothill Blvd.

Mike Uchida
Owner of Grove Way Bonsai Nursery

Page 1 of 2 ends

Attachment V
From: Omar Galindo
To: Steve Kowalski
Cc: Maria Manzo; Maria Ruelas; Robert Jimenez; [email protected] Subject: Fwd: Owner of 21459 Locust St Hayward | Opposition to Commercial Cannabis Dispensary Date: Wednesday, May 7, 2025 1:58:24 PM
CAUTION:This is an external email. Do not click on links or open attachments unless you know the content is safe.

Dear Planning Department,
I am writing to formally express our opposition to the proposed cannabis dispensary at 21463 Foothill Boulevard.

We are the owners of the property directly behind this location (21459 Locust St) and have serious concerns about the potential negative impact such an establishment may have on our neighborhood. Specifically, we are concerned about increased foot traffic, loitering, and a potential rise in nuisance or criminal activity—issues that have been observed near similar businesses in other areas.

This location was previously occupied by Walgreens, which provided essential goods and services to the community and was a valued, family-friendly tenant. In contrast, a cannabis dispensary may not offer the same level of community benefit or alignment with the surrounding residential character.

We urge the City of Hayward to consider attracting a tenant that better serves the needs of the neighborhood—such as a pharmacy, small grocer, or other retail that contributes positively to the area’s safety, accessibility, and long-term vitality.

Thank you for your time and attention to this matter. We would be happy to discuss our concerns further or provide additional input as needed.

Sincereley,
Omar Galindo
Omar Galindo
REALTOR® • CAL DRE #01393429
650.533.3526
[email protected]
www.omargalindo.com
580 El Camino Real, San Carlos, CA 94070

Page 2 of 2 ends

Hi my name is Icela Velazquez, I’m a junior at Mt. Eden High School and president of the Youth Advisory Council in Eden Youth, a council which focuses primarily on youth substance prevention within Hayward.

As a lifelong Hayward student, I’ve seen firsthand how marijuana use can harm underage youth
I have seen how people at school smoke cannabis in the bathrooms, in the hallways, and even in class. But not only is this issue within my school, I have also noticed people who I'm close to have become reliant on this substance at such an early age as well.

Adding another dispensary may increase access for underage people, despite age restrictions and could essentially put anyone under the age of 18 at a higher risk for addiction, long term harm, and future health problems but by expanding dispensaries that risk could become higher.

I strongly urge the Hayward City Council and Planning Commission to reconsider another dispensary in Hayward for the sake of all youth.

Thank you for your time and consideration.
(Received by City Clerk's Office on 09/25/2025 just before Planning Commission hearing) Attachment VI

$5 MILLION

PHENOS HAS PLEDGED TO
PAY 1 MILLION DOLLARS

IN ADVANCE FOR THE
FIRST 12 MONTHS
THE CITY OF HAYWARD HAS A 15:1 RATIO OF SMOKE SHOPS TO DISPENSARIES.

CURRENTLY, COOKIES HOLDS A MONOPOLY IN HAYWARD, OFFERING LIMITED PRODUCTS AT HIGH PRICES. RESIDENTS—WHO VOTED 2 TO 1 IN FAVOR OF LEGALIZATION—ARE LEFT WITH FEW SAFE OPTIONS AND OFTEN TURN TO UNREGULATED SMOKE SHOPS THAT SELL DANGEROUS AND UNTESTED PRODUCTS.

NEIGHBORING CITIES ARE LEVERAGING THE CANNABIS INDUSTRY TO BOOST REVENUE. SAN LEANDRO RECENTLY APPROVED ANOTHER LICENSE FOR AN

EXISTING DISPENSARY AND IS OPEN TO GRANTING MORE IF OTHER STAKEHOLDERS REQUEST THEM. SIMILARLY, SAN JOSE DOUBLED ITS LICENSES AND EXPANDED ITS GREEN ZONE TO INCLUDE RETAIL-ZONED AREAS.

HAYWARD FACES A $20 MILLION BUDGET DEFICIT. BY GRANTING ONE ADDITIONAL

LICENSE TO EACH OF ITS THREE EXISTING DISPENSARIES, THE CITY COULD GENERATE ABOUT $5 MILLION—COVERING 25% OF THE DEFICIT WHILE IMPROVING ACCESS TO SAFE, REGULATED PRODUCTS.

Attachment VII
Four Items Referenced at City Planning Likely to Be Raised at City Council *In 2016, cannabis was approved by a 2-to-1 margin in Hayward. For every one voice in opposition, two voted in favor. Since 2016 the margin has increased state wide.

1.) Planning Commission Member Guarantee Inquiry
A planning commission member asked what type of guarantee we can provide regarding the 1,000,000 dollar projection.

We are so confident in our commitment that we will pay the first 12 months in advance and deposit $1 million with the city. See tab “City Revenue and Donations”

2.) Cluster Concerns
Two locations do not constitute a cluster. The city has set a minimum distance of 600 feet between operators, and the two properties in question are 730 feet apart. This meets and exceeds the criteria established and voted on by the city. See Tab “Cluster”

3.) Proximity to Kids/Karate School
Concerns about children passing by or the proximity to a karate school are significant.

Let's see what the 8 year track record and history shows us.

All dispensaries enforce stringent check-in policies, ensuring that only individuals 21 and older can enter, which eliminates this concern.

We have asked the Hayward Police Department how many calls have they had of minors attempting to get in a dispensary in the last 8 years.

The answer was Zero! We manage 24 locations from Sacramento to San Diego. There has never been a single attempt. There are just too many layers of security for this to happen. It's important to note- you will not be able to tell what this establishment is or sells from the exterior.

We will provide examples of what our establishments look like from the exterior. See tab “Police” Regarding the karate school located in the back of the building, it's important to note that the state does not classify a karate school or even a Chuck E. Cheese as a sensitive use. This is because these facilities are either mixed-use, where adults also use the space or minors are accompanied by adults. If the city requests, we can add a barrier fence between the two businesses to separate the walkway.

In the city of Riverbank, a similar concern was raised about a karate school’s proximity to a dispensary. At the time, we did not have the support of the karate school owner during the city council meeting. However, here in Hayward, we have a signed letter of support from the karate school owner. In 2017, there were many unknowns, leading to theoretical concerns. Eight years later, nearly every city has either looked into or increased their number of dispensaries, and none have repealed their ordinances. This speaks volumes about the validity of those initial theoretical concerns. See tab “Karate and Neighboring Businesses” Today, we have letters of recommendation from city council members, mayors, police chiefs, and even neighboring businesses that once opposed dispensaries. This reflects our commitment to community safety and responsibility. See tab “City Leaders” Additionally, at the request of law enforcement in the cities where we operate, we have invested hundreds of thousands of dollars in private investigation work. Unlike dispensaries, which have multiple layers of security to prevent minors from entering, smoke shops have been notorious for selling untested, unregulated, and often synthetically laced cannabis and mushrooms. These shops sell items like baseball caps, backpacks, soda, and chips, and candy that lure minors.

Currently, Hayward has 15 smoke shops and growing. See tab “Smoke Shops” A contributing factor to the ongoing growth of Smoke Shops is the lack of options in Hayward, which has only one boutique cannabis shop in the city and one in the county. A 15,000 square foot concept, similar to Total Wine & More, could significantly curb the growth of smoke shops.

4.) Parking
This facility has more parking than Cookies, which was approved by the city in downtown Hayward, and more than Garden of Eden, approved by the county. We own 14 locations and manage another 10, totaling 24 operations. Parking is managed by adding staff and running promotions on slower days. For example, if Mondays and Tuesdays are slower between 10 a.m. and 2 p.m., we could run sales during those times to reduce traffic during peak hours.

This facility has more parking than both Cookies and Garden of Eden. Of the 24 locations we manage, several have less parking than a former Walgreens, yet they operate successfully. On average, a Walgreens sees more traffic, and the time spent by shoppers or pharmacy customers exceeds the transaction time of a cannabis customer.

Parking at this location is not a concern.

Now that all four concerns have been addressed, the only remaining issue is the "not in my backyard" (NIMBY) crowd, which to some degree is fueled by Cookies and Garden of Eden, both of which were represented at the city planning meeting.

It’s not uncommon for boutique operators to rally opposition. After all, who would want to compete with a 15,000-square-foot concept similar to Total Wine & More? Our operation will significantly increase city revenue, has a proven record of contributing to local charities, and employs more people. One only needs to visit a website like Weedmaps to see that our pricing is, on average, 30 to 50% lower than both Cookies and Garden of Eden.

We understand the opposition; however, they are protecting their own interests, not the community’s.

As for legitimate NIMBY concerns, these could be raised about any location in Hayward, and opposition would likely exist regardless of the site. The city invested significant time in creating a mapping tool that eliminates 99% of potential locations in Hayward. This tool is still in use today.

When you factor in properties with bank loans, which further disqualifies an astronomical amount of locations, and then account for landlords, property managers, and CCRs who refuse to lease to dispensaries, only a handful of locations remain. This is before even considering setbacks, sensitive use areas, or parking requirements.

This explains why, despite the city approving three dispensary locations, eight years later, Hayward still has only one.

Hayward residents approved cannabis by a 2-to-1 margin, and since 2016, statewide support has grown even further. This means for every opposing voice, there are at least two supporting voices. See tab “2 to 1”
Before selecting the former Walgreens, our group evaluated every available location using the city’s mapping tool. A couple of weeks ago, we printed all available LoopNet retail listings and ran them through the mapping tool again. The results, included in the attached binder, show that no other available property meets the city’s approval criteria. See tab “Properties” The former Walgreens meets all the criteria established by the city.

The city of Hayward voted to approve cannabis by a two-to-one margin in 2016. Today, the city has only one operation, Cookies, which operates as a monopoly, setting high prices and offering residents limited selection or options. As a result, Hayward residents are left with 15 smoke shops for alternatives.

We are here with a proven track record supported by evidence, tax contributions, and letters of recommendation from city council members, mayors, police chiefs and neighboring businesses who once opposed us. We are making a significant investment in the community by selecting a high-value building.

We are asking for a chance—a one-year commitment during which we will earn your trust and prove our value to the community.

Unlike other businesses, the city can revoke our license by contacting the Department of Cannabis Control, which would immediately trigger an investigation. The city can pull the license for any violation or choose not to renew it after one year.

We are asking for a short-term opportunity to prove ourselves to the council and the community.

By every metric set forth in the ordinance, we have exceeded what Cookies or Garden of Eden brought to the table. Comments heard from City Staff and city police show they are in support of us and of this location.

We are here asking for your vote. See tab “Letters of Support”

City Revenue

Letters of
Charitable
Donations

The Stanislaus County Sheriff’s K9 Association would like to formally thank Flavors at 2213 Patterson Rd, Riverbank for you for your generous donation to our retired K9 partners.

Our retired K9’s dedicated their lives to serve and protect our community. Your continuous support throughout the year assists with costly medical bills which are needed most after retirement.

Medical treatment after retirement is the responsibility of the SSK9 Association. Our reliable community partnership ensures our retired K9’s will get to enjoy a healthy, happy, comfortable life.

In Dogs We Trust,
SSK9 Association Board

Pete Feurtado Sr.

Founder
Big Petes Beach Cleanup
158 Rankin St
Santa Cruz, CA 95060
[email protected]
831-239-1093
September 4, 2024
To Whom It May Concern,
We are pleased to confirm that SC Flavors will be participating in the upcoming Big Petes beach cleanup event on Saturday, September 14, 2024. Our team is committed to contributing to the preservation and cleanliness of our local beaches, and we look forward to joining other volunteers in this important effort.

Our participation in this event underscores our dedication to environmental sustainability and community engagement. We believe that by working together, we can make a significant impact on the health and beauty of our coastal areas.

Please feel free to contact us if you need any further information or assistance.

Sincerely,
Pete Feurtado Sr.

Founder

qdi'i:ifiEs
Board of Directors
Richard D. O'Brien
President
John B. Anderson
Vice President
Rich Ulm
Secreta ry
Brian Baker
Treasu rer
Khat Andersen
Board Member
Dylan Bernardi
Board Member
Hope Cook
Board Member
Nora Guzman
Board Member
Mark Herbst
Board Member
lvey Mayol
Board Member
Brad Post
Board Member
Ted Rosen D.C.

Board Member
Cathy Mendoza
Executive Director
1 129 Bth St. Suite 101
Modesto, CA 95354
209.524.3s36
209.524.1205fax
www.societyfordisabilities.org
luly 24,2023
Flavors Cannabis Dispensary
22L3 Patterson Road
Riverbank, CA 95367
Dear Friends:

T'hank you for your past support of Society for disAbilities - your gifts help us survive and thrive! With your help, we continue to serve people with disABILITIES through our unique and exciting adapted recreational sports programs!
Our Medical Equipment Loan Closet is important and unique - we loan out over 1500 pieces of equipment each year! We currently have a waiting list for several pieces of equipment. With your support, we can put wheelchairs and other equipment in the hands of those who need us mostl
Even in the heart of the pandemic we were able to keep serving clients, due to the generosity of donors like youl We never shut our doors or laid off employees and we remained a source of equipment and resources for the disabled in our community.

Thankfully, our programs are open againl Currently, Adapted Bowling and Adapted Water Ski are in operation and well-attended. Miracle League Baseball starts again in September and we are conducting Bike Camp right now! Further down the road, we are adding golf, soccer, art and music to our menu - the lives of our clients are more fulfilling due to the experiences we provide! We have gratefully appreciated your generous support in the past - it makes a difference to those we servel We invite you to continue your investment as our partner with a gift of an amount you see fit. An award of any amount will be greatly appreciated and will help us in our quest to serve.

I look forward to hearing from you!
ihe/fu////a /
Cathy Mendoz
2000 West Olive Ave - Merced, CA 95348 (209) 726-3663 www.mmcfb.org January 6, 2023
Bluefire of Merced
1975 W Olive Ave,
Merced, CA 95348
Bluefire Management & Staff:

On behalf of the Merced County Food Bank, our staff, board, and the community we serve, I would like to thank you for your generous donations in 2021 and 2022. Your financial donations and your donation of the van has enabled us to provide more food services in our community for lowincome people who are food insecure.

Each month the Merced County Food Bank and our nearly 100 non-profit partner agencies who service the public, provide food and food resource assistance to nearly 20,000 people in the community. This is an ongoing significant challenge for all of us, and we are only able to accomplish this level of service as a result of partnerships with local businesses, people, and institutions.

We appreciate your commitment to address food insecurity in the communities you serve, and we are thankful to have you in the trenches with us as we fight hunger together.

Your financial donations allowed us to purchase over 20,000 pounds of nutritious food last year.

In addition, the donated van will allow our partner agencies to pick up food at the food bank provide distributions in areas that were previously not being services due to transportation challenges.

As we move forward this year, it looks like things are going to be a little more expensive than last year, and the need for our services will continue to grow. However, though your support and the support of the community, we will continue to be there to provide assistance to all those suffering from hunger; especially our low-income children and seniors on fixed income.

Once again, thank you for your generous donation. We appreciate your support and are very thankful to have you in the community, as well as your help fulfilling our mission.

Sincerely,
Bill Gibbs
Executive Director
FEIN# 80-0093563

6707 Third Street, Riverbank, CA 95367 – 209.863.7122 – www.riverbank.org April 7th, 2022
To: Flavors Cannabis Dispensary
The City is celebrating its 100th anniversary from the date of its incorporation on August 23, 2022 and all year long!
This once in a lifetime event, is commanding of a grandiose celebration. In collaboration with our Centennial Committee, Riverbank Historical Society, and our Community partners we are looking forward to celebrate “100 years of Action” with some of the following events:

Centennial Gala Dinner on March 5th
Founder’s Day Carnival on April 30th
“No Dance” Picnic & Car Show on June 25th
Centennial Celebration on August 20th
Centennial Historical Calendars, Centennial Art Mural and other mini events throughout the 2022 year.

As a valued local business and community leader, we are extremely thankful for your generous donation and support towards this Centennial Celebration.

Your donation as a sponsor will help ensure that our Centennial Celebration is a memorable year full of fun events for our Riverbank Families and Community.

THANK YOU FOR YOU DONATION!
Best,
Gaby Hernandez
Centennial Celebration Coordinator
The Riverbank Historical Society is a 501-C-3 non-profit organization. Our nonprofit number is 77-0377145 and the City of Riverbank Tax Id Number 94-6000407 The Stanislaus County Sheriff’s K9 Association would like to thank Phenos at 1234 McHenry Ave, Modesto for your generous donation to our retired K9 partners. With your donation, our retired K9’s will get to enjoy a healthy, happy, comfortable life.

In Dogs We Trust,
SSK9 Association Board
The Stanislaus County Sheriff’s K9 Association would like to thank Patient Care First at 1442 Angie Ave, Modesto for your generous donation to our retired K9 partners.

With your donation, our retired K9’s will get to enjoy a healthy, happy, comfortable life.

In Dogs We Trust,
SSK9 Association Board
The Stanislaus County Sheriff’s K9 Association would like to thank Flavors at 2213 Patterson Rd, Riverbank for you for your generous donation to our retired K9 partners.

With your donation, our retired K9’s will get to enjoy a healthy, happy, comfortable life.

In Dogs We Trust,
SSK9 Association Board
The Stanislaus County Sheriff’s K9 Association would like to thank the Fire House at 1601 W. Main Street, Turlock for your generous donation to our retired K9 partners.

With your donation, our retired K9’s will get to enjoy a healthy, happy, comfortable life.

In Dogs We Trust,
SSK9 Association Board

March 23, 2022
Dear City Leaders,
The Parks and Recreation Department within the City of Riverbank has benefited a great deal from Flavors continued generosity in support of our annual Cheese & Wine Festival, our Summer Concert Series and events hosted by our Historical Society.

The company can be counted on to contribute to the community and has established a strong relationship with our department as well as other City departments.

This group is friendly and supportive and a real asset to our community. If you have any further questions regarding Flavors and the benefits, we have received from them, I can be reached at 209-863- 7140 or by email at [email protected].

Sincerely,
Sue Fitzpatrick
Director of Parks and Recreation

March 22, 2022

Tasha Parra
Phenos Collective, Inc
1234 McHenry Ave, Suite C
Modesto, CA 95350
Dear Tasha:

I want to thank you for your generous contribution of $15,000.00 to the Fresno Chamber of Commerce in 2021.

Your contribution helps us provide needed education and informational support for area businesses and community members in the Greater Fresno County area.

Sincerely,
Lisa Walzem
Financial Manager
Fresno Chamber of Commerce
Forward Fresno Foundation
Donation Date Amount
April 7, 2021 $ 15,000.00
Fresno Chamber of Commerce is a 501(c)(6) organization. Tax ID # 94-0489640 Please save this receipt for tax purposes.

NAACP MODESTO/STANISLAUS BRANCH • UNIT 1048
P. O. BOX 181 • MODESTO, CA 95353 • (209) 896-9196
WWW.NAACPMODESTOSTANISLAUS.ORG • [email protected] .

March 9, 2022
Phenos Collective, Inc
1234 McHenry Ave. Ste C
Modesto, CA 95350
Dear Phenos Collective,
On behalf of the Modesto/Stanislaus NAACP, its Executive Committee, and members, I am writing to thank you for your $5000 donation to our local organization. The funds will be used to support equity and social justice cannabis initiatives in Stanislaus County.

The mission of the NAACP is to ensure the political, educational, social, and economic equality of all citizens. It is our goal to assist Stanislaus County residents who have been negatively impacted by the War on Drugs with training, mentorship, and business opportunities that will assist under-represented populations with entrepreneurial opportunities in the legal cannabis industry.

We look forward to furthering alliances and partnerships with Phenos Collective Inc. that will collectively serve our community for the greater good. Thanks again for your generous donation.

Sincerely,
Wendy Byrd
President
March 2, 2022
The Premier Group
Patient Care First
1442 Angie Ave
Modesto, Ca 95351
Re: Your Donation in the amount of $2,900 on December 31, 2021 Dear Patient Care First,
On behalf of Ray Of Hope Children's Services, I would like to thank you for your very generous donation to our organization. As these times have been challenging for many of us, it has been even more so for children living in crisis situations and poverty. Without the support of companies like yours we could not meet the needs of these innocent children.

Ray of Hope feeds, clothes, provides school support and a Babies In Crisis program for children living in poverty or in crisis from such things as Domestic Violence, Untreated Mental Health of Parents,Sexual Assault and Homelessness. We clothe and provide basic human needs and programs for over 2000 children annually.

It is our privilege to serve these kids and with the most humble heart we thank you for this donation. With the continued support of community members such as Patient Care First means Together, we are giving kids the opportunity to thrive! We support the city awarding The Premier Group with an additional location to better service our community. Their charitable contributions represent a true investment in the community and delivery on their promise to GIVE BACK!
With sincere gratitude,
Laura Saunders
CEO
Ray Of Hope Children's Services

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January 4.2022
F-lavors
Pacafi. Inc.
1234 McHenr,v AvenLre, Sr-rite C
Modesto CA 95350
Dear Friends.

Thank yolr fbr your generous donation of $2000 to Society fbr disABILITIES! As a 100% privately funded non-profit organization. proceeds of this donation help ensr"rre the continuation o1'ollr lrany programs and services to children and adults with diverse abilities. We are so thankful fbr yor"rr sr,rpport! Your donation helps kids like Emilio who is physically disabled. His mom Guillermina brought hirn to a Society fbr disABILITIES skating event even thoLrgh she r,vas hesitant. In a message Guillennina rvrote. "Thank you for putting on the skating event! It was so much fun and all the kids seemed so happy! I truly appreciate you guys. I've always been too afraid to take ollr son skating as he is physically impaired. Watching him skate. I saw hor,v happy this rnade him and I'd like to sign him up for Winter Snow Skiing. This event gave me the push we needed to try ner.v activities and not restrict him due to our own fbars."
We also operate the largest Durable Medical Equipment loan closet in Northern Califbrnia, providing medical equiprnent fbr those experiencing a temporary or permanent disability. Additionally, we provide recreational activities such as Adapted Bicycle Camp. Bowling, Miracle League Baseball. Day on the Farm. our Annual Special Needs Prom. and Adapted Water & Winter skiing.

Since 1 947 - we have been meeting the needs of those with disabilities in our community. Your generous sllpport will help to continue this in'rporlant work.

With Sincere Gratitude.

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.rd/r'/&r.! lert,t,schuttst,tl.fitr.yotrr' .ttrltltorl. Our l:cderul 'l'us ll) ,\'trnrher i: ()1-l)79E01.

Cathy Mend{za IL
Executive Director

The Stanislaus County Sheriff’s K9 Association would like to formally thank Flavors at 2213 Patterson Rd, Riverbank for you for your generous donation to our retired K9 partners.

Our retired K9’s dedicated their lives to serve and protect our community. Your continuous support throughout the year assists with costly medical bills which are needed most after retirement.

Medical treatment after retirement is the responsibility of the SSK9 Association. Our reliable community partnership ensures our retired K9’s will get to enjoy a healthy, happy, comfortable life.

In Dogs We Trust,
SSK9 Association Board

Central California Assyrian Student and Youth Association 285 Wiley Ct
Turlock, California, USA 95382
1,6s. 911912021
Thank you for your contribution of $350 to our organization' Your entire donation is tax-deductible.
your contribution will be used 6o. Assyrian Basketball 2021 season As a reminder, our organization, Central California Assyrian Student and Youth Association ICCASYA), is an Assyrian student/youlh organization centered in the Turlock/Modesto area of California' This area has a sizable population of diaspora-dwelling Assyrians and CCASYA's goals include uniting our community's young Assyrians, *orking to preserve ine assyrian culture, advancing the status of Assyrians within the community, promoting higher education and communiry service, and representing the young Assyrians of Central California on a national and international level' Your support is highly appreciatedl
Feel free to contact ccASYA ifyou have any questions or concerns.

Sincerely,
Urhay Ishaya
President, CCASYA
Central California Assyrian Student and Youth Association (CCASYA) is an exempt organization as described in Section 50L[cx3) of the Internal Revenue code of the United States of America' EIN # 81-5479450

THIS LETTER WILL SERVE AS YOUR RECEIPT
Cont4gt Information:

[email protected]
wwrv -facebook.com/CCASYA
Instagram @CCASYA209
Twiuer @CCASYA2O9
CCISYA
aLqh, ln,, Dear
February 18, 2021
The Premier Group
Attn: Tasha Parra
To Whom it may Concern,
On behalf of the staff and board of directors of Society for disABILITIES, we would like to express our deep appreciation for The Premier Group, Phenos and Flavors and the generous donations they have given over the years. Their support is an expression of a caring spirit and represents an investment in the future of our community. Their continued donations help us to make an impact on the most critical needs facing the disabled in our community.

All cannabis businesses made promises to make charitable contribution to organizations in the City. The Premier Group has been a consistent donor; their gifts exceeded $23,000 over the last five years, proving they’ve delivered on their promise to give back. Thanks to the generosity and support of community members like them, we are able to continue enhancing the lives of people with disabilities!
Their support helps kids like Emilio who is physically disabled. His mom Guillermina brought him to a Society for disABILITIES skating event even though she was hesitant. Later, Guillermina wrote, “Thank you for putting on the skating event! It was so much fun and the kids seemed so happy! I truly appreciate you guys. I’ve always been afraid to take our son skating as he is physically impaired. Watching him skate, I saw how happy this made him and I’d like to sign him up for Winter Snow Skiing. This event gave me the push we needed to try new activities and not restrict him due to our own fears.” The Premier Group is making a difference in the lives of community members who need it most! We would support the City awarding The Premier Group an additional location – we are confident in their ability to invest in our community as promised.

With Sincere Gratitude,
Cathy Mendoza
Executive Director
The Internal Revenue Service no longer accepts your canceled check or credit card receipt as proof of a charitable contribution. If your gift exceeds $250, please keep this letter as a receipt of your gift and notice that no goods or services were exchanged for your support. Our Federal Tax ID Number is 94-1279804.

02/23/22
Yezmene Fullilove
Social Media and Events Manager
Phenos Cannabis Dispensary
Please allow this letter to serve as verification that Yezmene has completed volunteer hours on the following dates with Love Modesto.

Any questions you may have, please let me know.

Sarah Kashefi, Event Coordinator
Love Modesto • 909 14th Street • Modesto, CA 95354
LoveModesto.com • 209-499-0757• [email protected] Beautify Modesto Parks (Gold) April 13, 2019 8:00 AM - 12:30 PM
Beautify Modesto Parks (Gold) October 3,
2020
8:00 AM - 12:30
PM
Children's Book Drive (Gold) October 3,
2020
8:00 AM - 12:30
PM
Conant Place Senior Apartments (Silver) October 3,
2020
8:00 AM - 12:30
PM
Beautify McHenry Avenue (Gold) April 24, 2021 8:00 AM - 12:30 PM
Clean Up Modesto (Gold) October 9,
2021
8:00 AM - 12:30
PM
Beautify McHenry Avenue (Gold) April 30, 2022 8:00 AM - 12:30 PM

February 22, 2022
To Whom It May Concern,
The Premier Group volunteered the Annual Celebration of Lights Holiday Parade on December 7, 2019. This event is hosted by the City of Modesto Parks, Recreation and Neighborhoods Department in downtown Modesto. The Premier Group assisted with maintaining road closures and closing/monitoring barricades for the duration of the event.

If you have any questions please feel free to contact me at (209) 577-5450 or [email protected]
Sincerely,
Stephanie Navarro
Volunteer Coordinator
City of Modesto
Parks, Recreation, & Neighborhoods

CLUSTER

HAYWARD, CA
21463 FOOTHILL BLVD
21463 Foothill Blvd is 730ft from Garden of Eden. These two properties are separated by 8 buildings
730 ft

REDWOOD CITY, CA
Embarc Dispensary is 536ft away from MMD
Dispensary, located on the same road

REDWOOD CITY, CA
Airfield Supply Dispensary and Flor Dispensary are 1,058 ft apart.

COSTA MESA, CA
South Coast Safe Access Dispensary and 420 Central Dispensary are 124 ft apart.

SANTA ANA, CA
Evergreen Dispensary and Tropicanna Dispensary are 322 ft apart.

SANTA ANA, CA
Mr. Nice Guy Dispensary and Eaze Dispensary are 604 ft apart.

EUREKA, CA
MOCA Dispensary and Humboldt Nation Dispensary are 64 ft apart.

EUREKA, CA
Ecocann Dispensary and Proper Wellness Center dispensary are 339 ft apart.

EUREKA, CA
MOCA Dispensary and Ecocann Dispensary are 743 ft apart.

EUREKA, CA
MOCA Dispensary and Mr. Humboldt dispensary are 719 ft apart.

OAKLAND, CA
STIIIZY Dispensary and Urbana Dispensary are 584 ft apart.

OAKLAND, CA
ECO Dispensary and Urbana Dispensary are 948 ft apart.

FRESNO, CA
Higher Level Dispensary and Embarc Dispensary are 1,217 ft apart.

FARMERSVILLE, CA
Token Farms Dispensary and Valley Pure Dispensary are 156 ft apart.

TULARE, CA
Token Farms Dispensary and Valley Pure Dispensary are 335 ft apart.

COSTA MESA, CA
Catalyst Dispensary and 420 Native Garden Dispensary are 137 ft apart.

STANTON, CA
Kannabis Works Dispensary and Haven Dispensary are 119 ft apart.

STANTON, CA
Culture Cannabis Club Dispensary and Catalyst Dispensary are 268 ft apart.

108

COMMUNITY BENEFITS AND INVESTMENTS PLAN

PAID VOLUNTEER HOURS FOR EMPLOYEES FOSTER COMMUNITY INVOLVEMENT Furthermore, our team members have dedicated hundreds of hours to volunteering their which we operate.

Love Modesto, an essential community-building organization in the city, that fosters the emphasis on the "My Modesto" montra the city so proudly boasts. For us, this falls under the broader "Love" umbrella. Although we have supported Love organizations in multiple surrounding cities, Love Modesto is particularly relevant to our spirit of community engagement. The organization's mission is to "inspire our community to love each other through connecting, participating, giving, and serving."
Love Modesto's initiatives align with our commitment to positively impact the community we serve.
demonstrates our dedication to giving back. As our liaison, Yezmene Fullilove so eloquently stated, "It was a great experience to be a part of, and we can't wait for the next opportunity to prove our dedication to the cities we live in." Our partnership with Love Manteca allows us to contribute to a
POLICE
3439 Brookside Road Suite 104 Stockton, CA 95219 I drivonconsulting.com P. (209) 636-4856 I F. (209) 940-2965
Memorandum Re: No Record of Youth Access to Cannabis Facilities in Hayward October 16, 2025
To Whom it May Concern:

On September 25, 2025 the City of Hayward conducted a public hearing before the Hayward Planning Commission hearing regarding a Conditional Use Permit Application [No.

UP-25-0011] by Gream Enterprises, Inc. (DBA Phenos Hayward) for the establishment of a commercial cannabis retail dispensary proposed for operation in a vacant tenant space located at 21463 Foothill Blvd.

During this hearing, serious concerns regarding potential youth access to the facility were raised, notwithstanding no evidence of similar instances of the same having been presented as to the City's sole existing, established, and operational cannabis retail storefront, 'Cookies', which is located at I 004 B Street.

Additionally, due to the lack of any incidence of the same ever occurring at any of the 14 existing cannabis storefronts owned and operated by my client, Angilbert Sarkis, Co-Owner of Gream Enterprises, Inc., on October 14, 2024 I submitted an inquiry to City of Hayward Senior Planner Steve Kowalski inquiring whether the City had any record whatsoever of youth accessing the Cookies store during its time in operation in the City.

This inquiry was referred to Detective Gabrielle Wright, whose responsibilities in the Hayward Police Department include approving security measures and monitoring regulatory and legal compliance with the City's relevant laws and regulatory ordinance with respect to the operation of cannabis facilities in the City. Her October 15, 2025 response to this inquiry as advanced by Mr. Kowalski in relevant part was as follows:
" ... in doing an initial search, there does not appear to be any kind of complaint generated for accessing Cookies ... "
This aligns with the operational track record and experience of Mr. Sarkis, as well as industry wide practice, that youth access to licensed, regulated cannabis facilities is virtually impossible and non-existent in practice.
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Angilbert Sarkis
RIVERBANK- You would
never know the business
being conducted by looking
at the outside of the building
MODESTO- You would
never know the business
being conducted by looking
at the outside of the building
TRACY- You would
never know the business
being conducted by looking
at the outside of the building

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INTRODUCTION TO COLLABORATION OF

SECURITY PROFESSIONALS
Danny Ziya, director of Knight
Video Surveillance Group, with
over 26 years of experience in law
enforcement and security. Danny
began his security career shortly
after leaving law enforcement to
pursue business. His first venture, CrimeTek
Security Services, was founded in 1999. In 2010,
he founded Knight Surveillance Group, which
has territory in Arizona, Texas, California, and
Nevada. Knight Surveillance Group, INC. is a realtime video surveillance company. Knight currently secures the property through the lenses of video
surveillance cameras in real-time.

Michael Pleasant, owner of Next
Level Protection, provides armed
guard services for on-site protection,
deterring unlawful activities, and
enforcing security procedures.

Next Level Protection has extensive
experience in providing security services.

Robert Caine, owner of Nor-Cal
Security & Low Voltage Services,
oversees the 24 hour monitoring
of panic buttons, fire suppression
devices, and burglar alarm systems.

Our company’s objective is to establish
multiple tiers of safeguarding measures,
rendering any perceived weaknesses in our
operations seemingly insurmountable to
potential criminals.

1. INDUSTRY LEADING SECURITY

PROFESSIONALS
Tasha Parra, serves as the Compliance and
Licensing Director for our network of cannabis
companies, a role that includes overseeing all
security protocols and actively monitoring security
cameras at all times. In line with her position, she
attends any and all compliance visits with police,
fire, and local and state authorities, including the
Department of Cannabis Control (DCC). Ms. Parra
is also listed as the primary contact with DCC to
oversee all compliance matters.

As the primary liaison for law enforcement and
emergency services, Tasha serves as a vital
communication link between Mr. Sarkis and the
integrated security team. Holding a degree in
Administration of Law Enforcement, Ms. Parra
brings over two decades of Retail Management
expertise to her role. For the past seven years,
she has been devoted to the cannabis industry
within our organization, consistently honing her
proficiency in security and regulatory compliance.

Bert Sarkis, owner of 11+ California cannabis
companies with over $200 million in annual
revenue, has built a solid reputation for mastering
every aspect of dispensary security. As the
mastermind behind the company’s security
protocols, he has established a comprehensive
and robust framework that ensures the safety and
compliance of each of his businesses.

His dedication to security stems from his wealth of
experience in the industry, refining and perfecting
the procedures to create a truly unparalleled
security plan. Under Sarkis’ guidance, the entire
security operation is a testament to his expertise
and commitment, offering assurance to the
community that the highest level of protection is
in place.

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21463 FOOTHILL BLVD 3

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• 24 hour Armed Guard services
provided by Next Level
Protection
• 24 hour off site surveillance
controlled by Knight Video
Surveillance Group
• 24 hour real-time alarm system
monitored by Nor-Cal Security
& Low Voltage Services
Mr. Sarkis actively contributes to the safety and security of our group of cannabis businesses on a daily basis. He oversees customer traffic flow, parking lot patterns, employee interactions, and security staff engagement. With a customized monitoring setup at three separate locations, Bert maintains a bird's eye view of each site, allowing him to simultaneously keep track of all essential security aspects.

Together, these essential security
professionals provide each of our locations
with industry-leading security services.

Together, these essential security professionals
provide each of our locations with industryleading security services.

Through direct communication between Tasha
Parra and the owners Bert Sarkis, Esther Lopez
and the proprietors of each of the three tiers of
security systems, our security procedures are
continuously reviewed and updated. Monthly
security meetings are held with the Security
Team to review and assess new matters and/or
operational procedures. To maintain its status as
the industry leader in dispensary safety, Mr. Sarkis
is constantly working to enhance security at all of
its stores. These are ongoing collaborations; as a
result of technological and organizational growth,
the range of security procedures we implement
is expanding all the time. Our dedication to
maintaining our position as the undisputed leader
in the dispensary security industry has resulted
in the development of a three-tiered security
system.

We are proud of the protocols we have established through these collaborations; our commitment to cutting-edge technology and stringent safety protocols are often cited as examples of our success. We have had numerous instances of unrelated crimes in our communities being solved thanks to the use of footage from our camera systems by law enforcement. Each and every time law enforcement has visited one of our facilities, they have been thoroughly impressed by our comprehensive security measures.
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ACCESS/ VISITOR CONTROL
Public access areas within our establishment,
such as the lobby, reception check-in area, and
retail store floor, are safeguarded by strict access
protocols. Access shall be granted after presenting
an accepted and verified form of identification,
which is then entered into our secure electronic
patient database, powered by IndicaOnline. This
ensures a safe and controlled environment within
our facility.

To maintain a secure and professional environment,
Brand Ambassadors conducting demonstration
presentations in the retail area are required to
register as vendors and provide their company
ID badge. This badge is linked to their patient
profile, and their visit is recorded digitally through
IndicaOnline. Additionally, Brand Ambassadors are
logged on the “limited access log” and provided
“visitor badges” during their time on the premises.

Vendors are granted access solely to the lobby
and sales floor. All Brand Ambassadors must be
over 21 years of age, and it is our strict policy that
no free cannabis products will be distributed by
vendors or staff at any time.

In the event that a customer or patient is denied
entry to our facilities or a sale, the incident is
meticulously logged into the IndicaOnline patient
database, detailing the specific circumstances.

Our software features a “blacklist” function to
ban individuals from our facility based on their
behavior. IndicaOnline promptly notifies patientintake personnel of the blacklisted individual and the reason for their ban. The general manager
and security personnel report to the lobby, where
the patient or customer is then denied access to
the retail floor and asked to leave the premises.

LIMITED ACCESS AREAS
Designated general access areas within our facility
include the lobby, reception, restrooms, and
non-cannabis storage spaces. All other areas are
classified as “limited access,” where only personnel
with proper security badges and prior knowledge
of security access keycodes are granted entry.
“Limited Access” refers to any area where cannabis
or cannabis products are stored.

LIMITED ACCESS LOG
Furthermore, any non-personnel individuals
entering limited access areas, such as repair
personnel, contractors, or alarm company
employees, will be documented in the “Limited
Access Log.” This log records the date, name,
time in/out, reason for visit, and company
affiliation. All visitors must present identification
and be confirmed to be over 21 years of age. The
“Limited Access Log” will be made available to the
city manager, police chief, or their designees upon
request. These visitors will be provided a “Visitor
Badge” to wear while on the premises and must
be accompanied by an authorized employee with
access to the necessary areas. Security personnel
or receptionists will complete the limited access
logs after verifying the visitor’s age identification.

OUTSIDE BUSINESS HOURS SECURE

ACCESS FOR ENTRANCE/EXIT DOORS AND

WINDOWS
Every access point is secured with a five-pin
locking mechanism and two entry-locking security
bars (burglary resistant). Every access point is
secured with a heavy-duty commercial roll-up
door that is closed and secured with commercial
grade locks during non-operational hours to deter
possible break-in attempts. All windows and doors
are covered on the inside with our proprietary
steel security mesh and externally with a graffiti
film that protects the glass from being broken
or scratched. High-intensity lighting is installed
around the entire premises for adequate visuals
by security personnel and on recorded video
footage.

2. OPERATIONAL SECURITY OVERVIEW

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21463 FOOTHILL BLVD 11

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count vs. perpetual inventory. Any discrepancies
are investigated and reported to the inventory
manager. All inventory
movements, records,
and discrepancies are
documented within
IndicaOnline, which
syncs with the California
Track and Trace METRC.

EMPLOYEE THEFT DETERRENCE AND

PREVENTION
All Phenos staff shall be well-informed of our zerotolerance policy regarding theft. Any evidence of theft will result in immediate termination, and
we will alert authorities of its occurrence. All
employees, regardless of position, are required to
submit to a search upon entering and exiting the
facility. Security guards are responsible for swift
and effective searches and report over the twoway radio on the clearance of every employee.

CLEAR BAG POLICY
All employees’ bags and
pockets are checked each and
every time they enter or exit
the building or the retail floor
by a third-party security guard
provided by Next Level Protection. Employees’
personal bags are required to be transparent
for ease of inspection as they enter and exit the
premises. Staff are not permitted to use purses
or backpacks within the building. These security
precautions are implemented to deter theft and
minimize retail inventory vulnerabilities.

STORING CANNABIS
Cannabis is stored in three places on premise,
displayed on the sales floor in display cases, in
Fireking fireproof safes, and behind passcode
lock storage rooms in the limited access areas.

Management facilitates the restocking of inventory
by entering their passcodes and bringing the
requested inventory to the sales floor.

RESTRICTED ACCESS AREAS
These areas are limited to
select managerial personnel
(regional, general, and
assistant managers) having
access to the vault and select
product storage rooms.

Those employees with
restricted access badges
are required to enter their
keycode to unlock access doors. Phenos shall keep
a current roster of employees who have access to
restricted access areas, surveillance systems, and
alarm systems. Anyone not wearing a limited or
restricted-access badge will be escorted away from
unauthorized areas by our security personnel.

BUSINESS HOUR SECURE ACCESS FOR

ENTRANCE/EXIT DOORS AND WINDOWS
Armed security guards control access to each
exterior access door during business hours
and authorize each visitor by prompting for
identification prior to being allowed building entry.

INVENTORY CONTROL AND MANAGEMENT
The inventory management portion of the
IndicaOnline software provides comprehensive
record-keeping, SKU batch numbers, pricing
and tax, shelf-location, product expiration dates,
distributor license information, detailed inventory
reports and audits, sales/customer records, tax
reports, and more. IndicaOnline provides realtime METRC tracking, which allows us to track inventory from the moment it arrives at the facility
to the time it leaves in a retail bag. If a package
were to ever come into question after leaving
our facility, we would have the ability to track all
products using their METRC unique identifier and
inventory integration provided by IndicaOnline.

IndicaOnline is a comprehensive inventory
reporting software system that accurately
documents the present location, amounts, and
descriptions of all cannabis and cannabis products.

Inventory audits are performed every 15 days, and
inventory reports are used to verify the physical
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FireKing® Turtle Fireproof
Safes (33 for cannabis
storage)
Specifications:
• Bolted to concrete floor
• 2,000°F Explosion
Hazard Rating
• 435 lb weight
• 30 foot UL impact rating
• ETL Electronic Media -
30 min
• Water resistant
• UL 1 hour fire rating
• Made in America
Operations:

Remain secure during business hours and locked
outside business hours

CASH HANDLING PROCEDURES
Armed security staff are informed of all cash
movements, and security staff follow very strict
guidelines to ensure cash transactions are
conducted safely and securely. Nightly closing
procedures include all movement of cash and/
or registers being done under the supervision of
armed guards. At facility closing time, the facility
is locked down while cash handling procedures
are completed. We have a zero incident record
of any security breaches regarding cash handling
procedures. Achieving $200 million in annual sales
requires us to always be diligent with our security
plans and procedures.

RECEIVING CASH
There are two ways of receiving cash during
the course of business, first is accepting money
from customers in exchange for goods. Each
employee is trained on how to verify currency
with the use of dual purpose counterfeit pens (UV
light and marker) and how to accurately count
change returned to the customer. Received cash
is immediately deposited into each cash register

3. CASH HANDLING
drawer to be counted and verified after business
hours. When cash received meets the required
threshold, it is pulled and secured for verification
behind closed doors. Minimal amounts of cash
are left in the cash register during the course of
business to minimize loss in the event of a robbery.

All employees are trained on how to use the panic
button in cash handling training.

In order to operate at the level of achieving $20
million in annual sales for each location, “change”
service are needed. Change orders are done
weekly and delivered by Sectran Armored Truck
Services. This is the secondary way of receiving
cash.

ARMORED TRANSPORTATION OF CASH
Cash deposits generated by the dispensary
are conducted by armored-car services. 21463
Foothill Blvd. will contract with Sectran Security
Inc. to provide safe
and secure cash
transportation.

Another one of our
distinct advantages
is that all of our distribution transactions are
conducted completely cash-free. All orders
that have been confirmed as delivered are then
forwarded to the accounting department to be
processed for payment. All debts are settled
through electronic funds transfers or check
payments.

We have secured access to reliable banking
services, enabling us to pay our city taxes
via check rather than cash. This approach
reduces risks tied to cash transactions for
both our business and the city.

TRACKING CASH
Each point-of-sale location has real time cash
transaction records that can be used to track and
verify transactions instantly. As part of the closing
procedures, the general manager will balance
the transaction records with actual cash receipts
and deposits and add the cash reserve amounts
on hand. All cash movements are documented
on the “safe log,” which is balanced and verified

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21463 FOOTHILL BLVD 13

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each morning with the Accounting Department.

The closing manager is responsible for reporting
daily sales, keeping track of cash on hand, and
accurately recording all cash movements for the
business day. Any discrepancies are reported to the
regional manager for assistance and verification.

Phenos has not had any cash shortages or thefts
reported.

To ensure our cash is counted
correctly, we employ $4000+
Cummins Allison Jetscan IFX
I100 money counters. These
counters have the most advanced
counterfeit detection in the
industry,” which utilizes sensors and analytic
software to scan and verify that each bill is real
and not counterfeit.

CASH STORAGE
Cash is secured at all times using a large, level 5
security gun safe located in the most secure area
of the building. The vault is secured by proprietary
steel mesh and reinforced walls and entryways.

Passcode entries are changed weekly to ensure
privacy and security.

Fatboy Extreme Series | Level 5 Security |
Specifications:
• 110 minute Fire Protection
• 975 lb weight
• 30 foot UL impact rating
• 12 gauge steel thickness
• Water resistant
• Made in America
• Lifetime Warranty
• Permanently secured to
floor
Operations:

Remains locked within vault at all times

SURVEILLANCE OF CASH STORAGE AND

POS LOCATIONS
All cash registers, pathways of travel for cash
transactions (sales floor to manager’s office),
areas where cash is counted (manager’s office),
and cash storage areas (restricted access area)
are all under 24 hour surveillance. At each pointof-sale location, cameras will be installed to capture and accurately identify the identities of
those purchasing or selling cannabis products, as
well as the entire retail sales floor.

Areas that store cannabis will be under 24 hour
camera surveillance at all times. We expect to
have approximately 50-70 video surveillance
cameras. Our Chief Technical Officer, Max Waldorf
and members of the collaborative security team
will carry out a final security walkthrough after
the entire buildout is finished. At this time, all
scope of view vulnerabilities are addressed, and
additional cameras are added to ensure a full
range of surveillance is achieved for all areas of
the premises.

POLICE DEPARTMENT NOTIFICATION
Upon discovering a significant discrepancy,
criminal activity, loss or unauthorized record
alteration, or any security breach, employees of
the cannabis business should immediately report
to their general manager. The general manager
will verify the claim and, if confirmed, promptly
prepare a detailed written report. This report,
detailing the nature of the incident and corrective
actions taken, will be sent to the Hayward Chief
of Police or their designee(s) within 24 hours of
the incident discovery, typically via phone followed
by an official email. The business will retain all
related records for transparency and potential
investigations and maintain open communication
with the Hayward Police Department.

ADDITIONAL CAMERA DETAILS
Our comprehensive security plan employs cutting
edge camera technology to ensure the safety and
security of our business, while simultaneously
maintaining a high level of operational efficiency.

The following features have been carefully
considered and integrated into our security system:

1. Continuous recording: Our cameras are
designed to record 24/7, providing round the clock
surveillance and security for our premises.

2. Infrared night vision: Equipped with advanced
infrared night vision capabilities, our cameras can
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capture clear footage even in low-light conditions,
ensuring continuous security during nighttime
hours.

3. Vandal-resistant construction: Our cameras
boast IK10 vandal-resistant ratings, which means
they are built to withstand potential acts of
vandalism, protecting the integrity of our security
system.

4. Water and dust resistance: With IP67 ratings,
our cameras are designed to resist water and dust
ingress, ensuring their functionality and durability
even in harsh environmental conditions.

5. Extensive recording capacity: Our security
system features a 90+ day recording capacity,
supported by RAID hard drive redundancy to
prevent data loss and ensure the continuous
availability of recorded footage.

6. Secure data storage: All recorded video data
is encrypted and stored within a heavy-duty,
locking network enclosure, safeguarding our
valuable security footage from unauthorized
access.

7. Comprehensive coverage: Our security system
is designed to cover at least 20 feet of each
entrance and exit, providing a wide surveillance
range to monitor and secure all access points to
our premises.

8. Parking lot surveillance: In addition to general
surveillance, our security system specifically
covers the entrance and exit of our parking lot.

9. Remote, real-time camera access will be provided
to the Hayward Chief of Police or their designee(s)
prior to opening via a document detailing RTSP
stream access procedures. By implementing this
state-of-the-art security plan, we are committed
to providing a safe and secure environment for
our business, employees, and customers, while
maintaining the highest standards of operational
efficiency.

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21463 FOOTHILL BLVD 17

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• Stronger than steel bars
• Serves as a barrier to prevent propelled objects/
explosives from penetrating the facility.
• Contracted by local business
6) Security Guards (licensed by BSIS)
• Provided by Next Level Protection
• A licensed, uniformed, armed guard patroling
during business hours to
manage premises, control
site access, prevent
sampling or use of product
in parking areas. Up
to three (3) additional
security personnel can beadded as necessary
during peak hours.
• Armed guards control/manage the flow of the
lobby, limited access areas, entrance and exits.
• Visual deterrent to unlawful activities
• Enforce strict “no loitering” policy
• All guards have two-way radios
• Supervise and facilitate cannabis deliveries
• Perimeter checks are performed several times
a day to inspect lighting, trash pickup, loitering
and parking enforcement.
7) Commercial Alarm System
• Professionally installed, maintained and
monitored by Nor-Cal Security & Low Voltage
Services.
• Motion Sensors to detect entry and exit from
all secure areas, perimeter
entry points and windows.
• Panic buttons (with direct
line to local lawenforcement)
on alarm panels, reception
office, dispersed across
several registers on the sales
floor, and at all premises entrances.
• Easy access to communication with the fire
station, police department, etc. in the event of
an emergency.
• Alarm-equipped cameras with strobe lights
serve as active deterrents.

The Application includes a description
of perimeter security, exterior lighting,
on-site security guards, proposed guard
hours, and their responsibilities.

PERIMETER SECURITY
1) Cement Crash Posts (Bollards)
• Heavy-duty steel posts
placed at vulnerable
points on the building
like behind large glass
windows.
• Contracted by local
business
2) Landscape Boulders
• Aesthetically pleasing
security barrier
• 6ft+ wide natural stones
placed on exterior
premises to prevent
vehicle entry
3) Security/Graffiti Film
• Installed on all exterior-facing glass
• Mitigates breakage of glass
• Prevents scratch/puncture damage to glass
• Contracted by local business
4) Heavy-Duty Commercial Grade Roll
Up doors
• Professional installed
• Provides additional layer
of protection for all
doorways
• Visual deterrent for theft
or burglary
• Contracted by local
business
5) Custom Steel Mesh Window and Door
Panels
• Bolted on inside of all exterior windows and
doors
• Custom developed to be aesthetically
appealing

4. PERIMETER SECURITY
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8) Perimeter Lighting
• High-Intensity LED Perimeter Lighting
• High-visibility 5000K, 70W 6000 Lumens
• Cover entire perimeter of building and parking
lot
• Motion-Activated “Dusk ‘till Dawn”
Our experience has enabled us to identify
and evaluate the best lighting systems; each
of our locations is equipped with perimeter
security lighting that has been proven effective.

We shall invite the police chief and/or the
director of the development service to review
and give their approval before opening to
ensure that the exterior lighting is appropriate.

ADDITIONAL SECURITY MEASURES
1) Built-in Vault Room
• Interior walls fitted with reinforced steel mesh
• Passcode entry lock
• Restricted access area
• For secure storage of cannabis products
2) Security Rooms
• One-way windows for security personnel to
discreetly observe sales floor
• Private rooms in retail area allow customers and
patients to feel protected and discourage potential
perpetrators.
3) 2-Step Identification Process
• Verification of age/Medical ID cards prior to
entry of the lobby
• Verification of identity before purchase is
initiated.
• Staff Badges must be worn at all times when on
premises
• Limited-access areas accessible only by select
staff with proper badge
4) Trilogy T2 DL2700 BHMA Grade 1
passcode door locks
• Installed on all limited-access and restricted
access doors
• Multi-digit pin entry
• Battery powered and still accessible during
power outage
5) Fire-Rated Drywall and Steel Reinforced
Studs on Interior Walls
• Fire-resistant gypsum core provides additional
fire resistance over regular panels
6) Cannabis Products on Display
• Accessible only under employee supervision in
retail sales area
• No cannabis products visible from lobby/ outside
premises
7) Posted Signage
• “Loitering Prohibited” (citing penal code),
security personnel enforce the no loitering rule
• No One Under 21 Allowed / 18+ with State
Medical Cannabis ID Card.
• City Business License, Seller’s Permit, Local and
State Licenses posted in plain view in lobby.
8) Power Backup Systems
• Two-Hour battery backup UPS on every alarm,
network, computer, and camera system.
• 3x 7000W Gas Generators
• Ensures locks remain uncompromised during a
power outage and that safe/vault rooms remain
secure.
• Backup keys to lock/unlock doors in unlikely
event of complete power loss.

ON-SITE SECURITY GUARDS AND THEIR

RESPONSIBILITIES
Our security plan ensures that a security guard(s)
will be on-site during hours of operation,
providing constant protection for the premises.

During business hours, we will deploy a licensed,
uniformed, and armed guard to oversee both the
exterior and interior of the property. This staffing
level is designed to meet the security demands
of our initial opening period. However, we will
remain flexible and responsive to fluctuations in
customer traffic, increasing the number of guards
as needed during particularly busy days or events
to maintain a safe and secure environment.

STRINGENT SECURITY PROTOCOLS
Our security guard(s) are tasked with serving as a
visible deterrent to unlawful activities, enforcing a
strict “no loitering” policy, and effectively engaging
with customers when necessary. Guard(s) must
prevent individuals from lingering on the premises
unless they are directly involved in activities related to the permitted operations of the business.

During opening and closing procedures, security
personnel accompany management to secure site
access and ensure the premises are properly secured.

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Security guard(s) oversee parking to maintain
consistent traffic flow and deter on-site
consumption. All security personnel,
receptionists, and management
staff communicate via two-way
radios throughout their shifts.

Guards are responsible for securing
site access during deliveries. During
business hours, management
coordinates with security personnel
regarding cash movements
to maintain secure coverage.

Armed guards manage the flow
within the lobby, limited access areas, entrances,
and exits. Perimeter checks are conducted several
times daily to assess lighting, trash pickup, loitering, and parking enforcement. Entrance areas remain
locked at all times, controlled by management
and security personnel. Security guard(s) monitor
individuals inside and outsidet he cannabis
business, the parking lot, and any adjacent
property under the business’s control, ensuring
that the parking lot is cleared of employees and
their vehicles 30 minutes after closing. Security
guard(s) inspect and approve identification for all
visitors, accurately log the required information
using the “Limited Access Log,” and issue a “visitor
badge” for all guests. Security personnel supervise
the movements of vendors and brand ambassadors
during sales floor demonstrations. Security logs
are audited at shift changes to ensure accuracy.

Every member of our security personnel undergoes
and successfully completes an extensive
preemployment screening process before joining
our team. This ensures they possess the necessary
qualifications, skills, and backgrounds to meet
our security services’ high standards. Additionally,
our security staff must carry valid credentials
attesting to their proficiency in weapons training
and certification, demonstrating their capability to
effectively and responsibly handle critical situations.

Moreover, our security team members are fully
licensed by the California Bureau of Security and
Investigative Services (BSIS), a regulatory agency
that enforces stringent standards for professional
security services. This licensing guarantees
that our staff operates in compliance with
state regulations and adheres to the highest
level of ethical conduct and professionalism.

By upholding these rigorous requirements, we
provide our clients with a skilled and dependable
security force that is not only well-trained but also
committed to ensuring the safety
and well-being of those they serve.

CYBER SECURITY (NETWORK SECURITY

PROTOCOLS)
At 21463 Foothill Blvd., our highest priority is
to maintain a robust and impenetrable network
infrastructure, safeguarding the integrity and
confidentiality of our data and systems. In our
unwavering dedication to fortifying cybersecurity,
we have established a meticulous inspection and
maintenance regimen for
our network, hardware,
and software components.

Leveraging state-of-the
art Ubiquiti UniFi network
equipment, we provide
a flexible networking
interface combined with an enterprise-grade,
multilayered firewall and threat management
system. This advanced technology enables
us to enforce stringent security protocols,
effectively mitigating potential risks and ensuring
the utmost protection of our digital assets.

MONTHLY INSPECTIONS AND AUDITS
(COMPLETED BY OUR IN-HOUSE TECH

SUPPORT TEAM)
We prioritize the enforcement of rigorous security
protocols through regular monthly inspections
and audits carried out by our skilled in-house tech
support team. These comprehensive evaluations
ensure that our network, hardware, and software
remain current, secure, and operating at peak
performance. During these assessments, our
technicians execute general maintenance
tasks and diligently complete an extensive
inspection checklist. This checklist encompasses
critical aspects such as equipment wear,
21463 FOOTHILL BLVD 20

CONFIDENTIAL SECURITY PLAN
lifespan percentages of printer components
and other hardware, and any requisitions for
technical supplies, including walkietalkies,
toner, batteries, and more. Our meticulous
approach to these audits guarantees the ongoing
adherence to stringent security standards and
the overall reliability of our infrastructure.

BI-WEEKLY CAMERA AUDITS
We emphasize the strict adherence to security
protocols by performing
bi-weekly camera audits
alongside our regular
monthly inspections. These
specialized audits serve
to guarantee a minimum
of 90 days of 24/7 surveillance footage for each
camera situated on our premises.

In the event that any discrepancies or issues are
detected during these thorough assessments, we
promptly initiate investigations and proceed with
the necessary replacement or repair of the affected
cameras or storage hardware. This diligent
approach to maintaining our surveillance systems
demonstrates our unwavering commitment
to enforcing stringent security measures and
ensuring the utmost protection of our facility.

LOG ANALYSIS AND RETENTION
We are committed to the perpetual retention
of inspection logs, allowing us to meticulously
examine failure patterns and anomalies in our
hardware and software systems. In addition, we
preserve a full year of network logs, encompassing
granular IP and location data for each internal
And external connection attempt made to our
network. This all-encompassing log retention,
when coupled with our advanced multi-layered
firewall, empowers us to effectively analyze and
counter potential threats, thereby securing our
network’s enduring safety. Our dedication to
these proactive underscores our Commitment to
maintaining a secure and dependable network
environment for our enterprise. By protecting our
data and infrastructure, we not only defend our
organization’sinvaluable assets but also guarantee
a stable and reliable experience for our workforce
and clientele. Our devotion
to robust network security is
a reflection of our pursuit of
excellence in every facet of our
operations. We are eager for
the city of Hayward to evaluate
and endorse our stringent
network security protocols.

DESIGNATED SECURITY

REPRESENTATIVE/LIAISON
(24-HOUR

CONTACT)
We are dedicated to upholding
the highest level of security measures,
fostering a distinctively secure atmosphere.

In critical situations arising after business
hours, the head of the security team will be
promptly alerted and responsive. Contact
information and email will be readily available.

Owners: Bert Sarkis , Esther Lopez
Compliance and Licensing Director: Tasha
Parra
Both Mr. Sarkis and Ms. Parra possess extensive
expertise in all aspects of security procedures,
with a focus on after-hours protocols. They are
designated as 24-hour emergency contacts
in every city where we operate. Mr. Sarkis and
Tasha have access to real-time video surveillance
and direct communication with a 24-hour center,
Nor-Cal Security & Low Voltage Services, Knight
Surveillance Group, and an on-site armed
guard. Their swift and effective decision-making
capabilities ensure that no time is wasted.

Their 24-hour emergency contact information
will be registered with the city of Hayward, fire,
and police services, and will be updated and
reviewed quarterly. Both contacts are available
to discuss security measures or operational
concerns with the chief of police upon request.

A current copy of all security plans will be kept
on the premises and reviewed annually, to be
presented to the chief of police when required.

SECURITY PLAN
21463 FOOTHILL BLVD 21

CONFIDENTIAL

5. EMPLOYEE TRAINING AND POLICIES

EMPHASIZING STRINGENT SECURITY

PROTOCOLS IN EMPLOYEE DEVELOPMENT

AND TRAINING
Our organization prioritizes comprehensive
employee training to ensure adherence to
standard operating procedures and legal
requirements. All team members undergo a
twoweek intensive training program followed by
continuous education on various subjects. Our
certified cannabis trainers deliver this training,
promoting secure and responsible cannabis sales.

We cultivate a culture of excellence by focusing
on internal growth, with only two external hires in
the history of our company (a tech manager and
an accountant). Promoting from within provides
employees with a clear career trajectory, job
security, and motivation for skill enhancement.

This approach fosters collaboration, teamwork,
and a sense of belonging, leading to increased job
satisfaction, productivity, and employee retention.

External hires are chosen based on expertise and
skills.

Employees must review and comprehend our
comprehensive employee handbook, which covers
topics from etiquette and attire to emergency
response strategies. New recruits are consistently
assessed through quizzes and role-play exercises
related to our retail operations. Moreover, staff
members receive specialized training tailored to
their individual department roles.

Training manuals, worksheets, and SOPs are
distributed during orientation, and employees
must successfully “test out” before engaging
in unsupervised sales service. By emphasizing
training and internal growth, our organization
ensures excellence in operations and employee
satisfaction.

We have also crafted an exclusive, operation
specific training manual. Employees will undergo
a rigorous, cutting-edge training program that
surpasses industry standards. Over 40 hours of
instruction will be provided on the following topics:

BUDTENDER/RECEPTIONIST TRAINING

OUTLINE
• Cannabis Regulations and Your ResponsibilityWhat’s at Risk • “Liability and Penalties”
• How to Effectively Communicate with
Consumers
• Requirements for making a sale
• Understanding Daily Purchasing Limits
• Age Restrictions
• Packaging and Labeling
• Restrictions on Selling Cannabis
• Checking for Identification
• Record Keeping
• Visitor Logs
• Security Footage
• Incident Forms
• Other Documents
• Compliance Checks- Safety and Security
• Physical Security
• Employee Badges
• Visitor and Vendor Security
• Access Device Control
• Waste Disposal
• Receiving a Delivery
• Entering and Exiting
• What to Do During an Emergency
• Consumer Safety and Education
• Basics of the Endocannabinoid System
• Methods of Ingestion
• Different Forms of Cannabis
• Cannabinoids
• Terpenes
• Effects of Cannabis
• “Coaching” the Consumer
• Customer Service
• The core values of the dispensary
• The importance of being good neighbors
• How to handle communication issues, resolve
conflict, and address problems before they grow

SECURITY/SAFETY AWARENESS TRAINING
Our Security Officers and employees will receive
Security/Safety Awareness Training in a multitude
of situations, including but not limited to:
• Crime and loss prevention in the Cannabis
industry
21463 FOOTHILL BLVD 22

CONFIDENTIAL SECURITY PLAN
• Retail storefront rules and operating procedures
• Incident observation and reporting techniques
• Surveillance detection (Pre-Attack/Robbery
Prevention)
Active Shooter: location of all panic buttons
• Natural disaster preparedness and evacuation
procedures
• Safety hazards
• Emergency equipment placement
• Fire prevention skills
• Personal protective equipment
• Employer orientation and policies
• Substance abuse
• Use of communication devices (e.g., telephones,
iPads, radios, computers)
• Workplace violence
• Conflict resolution awareness
• Dealing with intoxicated individuals
• Parking lot security
• Track and Trace
• Procedures for first aid, Cardiopulmonary
Resuscitation (CPR), and Automated CPR/First Aid
Training: held twice a year for all management
employees

ADDITIONAL TRAINING PROGRAMS BY
DEPARTMENT:

Reception:

Training covers patient/customer check-in
procedures, new patient/customer signup,
identification and medical recommendation
verification (DCC Section 15404), employee
badge training, retail customer training,
and strict adherence to security measures.

Budtending:

Employees receive training on medical and
recreational cannabis limits, product knowledge,
secure cash handling procedures, POS system,
inventory organization, pricing, merchandising,
display handling, CBD training, product weights/
concentrations, packaging and labeling, dosing
and ingestion guidelines, and our industry-leading
exceptional customer service guidelines, all while
maintaining stringent security protocols.

Floor Leads:

In addition to reception and budtending programs,
floor leads undergo training in advanced cash
handling procedures, advanced security measures,
and advanced inventory control guidelines to
maintain a secure environment.

Social Media:

Training focuses on marketing, community
outreach, and consumer engagement, ensuring
that all content aligns with strict security and
compliance standards.

Inventory Manager:

Employees learn quarantine and expiration
procedures, advanced inventory control
procedures, all DCC regulations, and METRC
training to maintain a secure and compliant
inventory.

Assistant Manager:

Training includes METRC, cash handling reporting
procedures, opening/ closing procedures, CPR and
first aid, safety and security procedures, natural
disaster preparedness, and fire and safety plans.

General Manager:

In addition to all the training listed above, general
managers receive training in enhanced accounting
procedures, all DCC regulations, CDPH packaging
and labeling guidelines, and maintaining CPR and
first aid certification.

All employees receive security protocol education,
with job-specific passcodes for restricted access
areas. Monthly safety meetings ensure adherence
to safety protocols, roleplaying scenarios for
security breaches, natural disasters, fire safety
plans, and panic alarm activations, maintaining a
secure and compliant work environment.

SAFETY PLAN OVERVIEW
In adherence to the City of Hayward’s requirements
for a Safety Plan for cannabis retail stores, we
present this document outlining the necessary
safety protocols for the cannabis retail store,
located at 21463 Foothill Blvd, Hayward. The
retail dispensary will occupy an existing building

SECURITY PLAN
21463 FOOTHILL BLVD 23

CONFIDENTIAL
that formerly housed a business that experienced
significant traffic. The building was purposefully
designed for retail customers and offers the
advantage of over 50 available parking spots.

ODOR MITIGATION
As a reputable group operating multiple locations
and generating over $200 million in cannabis
sales, we have not experienced any cannabis
odor issues. Odor concerns usually arise from
cultivation facilities; however, our proposed site
focuses solely on retail sales of pre-packaged
cannabis products from distributors. There will be
no cannabis cultivation, processing, or extraction
activities, and on-site consumption is strictly
prohibited. This ensures minimal to no cannabis
odors, maintaining a pleasant and welcoming
environment for the surrounding community.

COMMUNITY LIAISON AND OUTREACH
We prioritize building positive community
relationships and have appointed Yezmene
Fullilove as Chief Community Liaison Director, with
Valeria Reyes as Assistant Community Liaison.

Yezmene’s email and phone number will
be provided to the city mayor and Chief of
Police. With extensive training and successful
coordination of community events, Yezmene is
dedicated to forging strong connections between
the retail dispensary and the local community.

Community Liaison, Yezmene Fullilove
Assistant Community Liaison, Valerie Reyes
Yezmene also manages employee volunteer work,
promotes participation in local charity events
and fostering community unity and support. Our
commitment to bridging the gap between the
community and the dispensary has significantly
contributed to our success.

All staff are trained to treat any robbery—armed
or unarmed—as a life‑safety event. During
onboarding they complete a security block that
covers robbery prevention, panic‑button locations,
and active‑shooter awareness, with quarterly
role‑play refreshers to keep procedures sharp.

THREAT RECOGNITION AND SILENT ALARM
The moment a robbery is perceived, employees
remain calm, halt non‑essential movements, and
avoid provoking the perpetrator. The nearest
team member discreetly depresses one of the
hard‑wired panic buttons mounted beneath
the register, at reception, or in the manager’s
office. These buttons are monitored 24/7 by
Nor‑Cal Security & Low Voltage Services and
transmit directly to Hayward PD dispatch.

INTERNAL NOTIFICATION
If doing so will not escalate the situation, the
employee who first sights the threat broadcasts
the coded phrase “Black Sky in [location]”
over the facility’s two‑way radio network (issued
to reception, floor staff, management, and
armed guards). This silently alerts the entire
team without alarming customers; guards and
managers immediately acknowledge the code.

COMPLIANCE AND OBSERVATION
Employees do not attempt to disarm or restrain
the suspect. They comply with all demands while
casually noting distinguishing features, weapons,
escape direction, and vehicle information. Because

6. EMPLOYEE RESPONSE TO AN ARMED OR

UNARMED ROBBERY WHILE PRESENT
21463 FOOTHILL BLVD 24

CONFIDENTIAL SECURITY PLAN
registers are kept at minimal cash thresholds
under our standard cash‑handling policy, exposure
to loss is limited .

GUARD ENGAGEMENT
The on‑site BSIS‑licensed armed guard maintains
a safe, tactically advantageous position with clear
line of sight. Firearms are drawn only if there is an
imminent threat to life; otherwise, the guard also
complies and continues to observe, in keeping
with Next Level Protection duty protocols.

LOCKDOWN ONCE THE ROBBER EXITS
As soon as the perpetrator leaves the premises, the
manager on duty orders an immediate lockdown:
all exterior doors equipped with five‑pin locks,
dual security bars, and commercial roll‑up doors
are secured, and the follow‑up code “Black Sky
Clear” is transmitted over the radio. Customer
intake is suspended until police arrive.

EXTERNAL NOTIFICATIONS AND COMMAND
TREE
If the panic alarm has not already triggered a
dispatch, the manager dials 911, then contacts
the 24‑hour security command chain—Compliance
& Licensing Director Tasha Parra and owner
Bert Sarkis—who have live remote surveillance
camera access and serve as official liaisons to law
enforcement .

SCENE PRESERVATION AND REPORTING
Staff leave cash drawers and affected areas
untouched, separate witnesses, and make
contact with Tasha Parra or Bert Sarkis. The
manager generates an incident report while
details are fresh and submits the report to the
Admin, Human Resources, and all necessary
departments. The Next Level security guard will
also generate a report and submit the report to
Next Level Security Director - Michael Pleasant.

Hayward Chief of Police will be provided with all
reports and footage within 24 hours, detailing the
event and corrective actions taken.

ONGOING TRAINING AND AUDITS
Quarterly drills reinforce the above steps;
panic‑button use is re‑certified every six months
during cash‑handling refreshers. Bi‑weekly
camera audits and monthly security inspections
ensure that all hardware supporting this SOP—
panic buttons, radios, locks, cameras, and UPS
backup—remains fully operational.

This narrative section provides the clear,
step‑by‑step employee protocol the City
requested for comment (a), demonstrating how
our existing infrastructure, guard services, and
training framework integrate into an actionable
robbery‑response plan.

7. SECURITY-PERSONNEL PROTOCOL FOR

AN AFTER-HOURS BURGLARY
When the facility is closed to the public,
protection is maintained by our 24‑hour
security stack:
(1) A UL‑listed commercial alarm system
monitored in real time by Nor‑Cal Security
& Low Voltage Services;
(2) Continuous remote security surveillance by
Knight Video Surveillance Group
(3) All security layers are coordinated through
two designated 24‑hour contacts—the owner,
Bert Sarkis, and Compliance & Licensing
Director Tasha Parra—who have instant access
to live camera feeds and alarm dashboards.

1. Automatic detection and escalation
After hours, every access point is secured with dual
five‑pin locks, and heavy‑duty roll‑up doors; all
windows and doors are fitted with our proprietary
steel security mesh and internally with a graffiti
film that protects the glass from being broken or
scratched. Interior motion sensors cover all secure
zones within the building. Any breach triggers the
burglar alarm, which immediately notifies Nor‑Cal’s
24‑hour monitoring center and coordinates with
Knight Protection surveillance which has access
to 24/7 cameras and auto‑dispatches Hayward
PD. Simultaneously, Knight Surveillance monitors
the site and immediately notifies police providing
real‑time visual confirmation for police and our
internal command.

2. Remote verification and notifications
Knight Surveillance technicians monitor live
footage and phone‑verify the event with PD. The

SECURITY PLAN
21463 FOOTHILL BLVD 25

CONFIDENTIAL
technician then calls the 24‑hour contacts (Bert
Sarkis or Tasha Parra) to brief them and provide
an incident number.

3. Guard response on scene
In the event a security guard is on site, the security
guard will coordinate with knight surveillance as
they monitor the premises. High‑intensity LED
lighting around the façade ensures clear visibility
for incoming units.

4. Scene turnover and preservation
The guard and arriving manager await instructions
from HPD (or 24‑hour contact). Once the premises
is secured, the manager will:
• stop all alarm sirens and re‑arm unaffected
zones;
• contact our CTO to provide all the relevant
security footage for HPD evidence;
• photograph and seal breach points;
• inventory any losses and secure remaining
product in the vault and FireKing safes

5. Reporting and follow‑up
The owner/ emergency contact files a written
incident report with Hayward PD and the City
Manager within 24 hours, attaches camera
footage on encrypted media, and schedules any
emergency board‑up or lock replacement. A full
debrief is added to the monthly security‑team
meeting agenda so procedures and hardware can
be updated as needed.

8.SECURITY MEASURES / PROTOCOLS FOR

PRODUCT STORAGE AFTER HOURS

BUILDING SECURITY INFORMATION

1. Product Storage After Hours
Cannabis is stored in three places on premise,
displayed on the sales floor in display cases, in
Fireking fireproof safes, and behind passcode
lock product storage rooms in the limited access
areas. Management facilitates the restocking
of inventory by entering their passcodes and
bringing the requested inventory to the sales floor.

Product on the sales floor is stored
in FireKing® Turtle Fireproof Safes.

Specifications:
• Bolted to concrete floor
• 2,000°F Explosion Hazard Rating
• 435 lb weight
• 30 foot UL impact rating
• ETL Electronic Media - 30 min
• Water resistant
• UL 1 hour fire rating
• Made in America
Operations: Remain secure during business
hours and locked outside business hours

2. Building Security
Security/Graffiti Film
• Installed on all exterior-facing glass
• Mitigates breakage of glass
• Prevents scratch/puncture damage to glass
• Contracted by local business
Heavy-Duty Commercial Grade Roll Up
doors
• Professional installed
• Provides additional layer of protection for all
doorways
• Visual deterrent for theft or burglary
• Contracted by local business
Custom Steel Mesh Window and Door
Panels
• Bolted on inside of all exterior windows and
doors
• Custom developed to be aesthetically appealing
• Stronger than steel bars
• Serves as a barrier to prevent propelled objects/
explosives from penetrating the facility.
• Contracted by local business
• 16 gauge steel with see-thru visibility
Commercial Alarm System
• Professionally installed, maintained and
monitored by Nor-Cal Security & Low Voltage
Services.
• Motion Sensors to detect entry and exit from all
secure areas, perimeter entry points and windows.
• Panic buttons (with direct line to local law
enforcement) on alarm panels, reception office,
dispersed across several registers on the sales
floor, and at all premises entrances.
• Easy access to communication with the fire
station, police department, etc. in the event of an
21463 FOOTHILL BLVD 26

CONFIDENTIAL SECURITY PLAN
emergency.
• Alarm-equipped cameras with strobe lights
serve as active deterrents.

Perimeter Lighting
• High-Intensity LED Perimeter Lighting
• High-visibility 5000K, 70W 6000 Lumens
• Cover entire perimeter of building and parking
lot
• Motion-Activated “Dusk ‘till Dawn”
Our experience has enabled us to identify and
evaluate the best lighting systems; each of our
locations is equipped with perimeter security
lighting that has been proven effective.

Karate &
Neighboring
Businesses
Letter of Support
from Tadanado Jiu
Jitsu Owner
Letter of Recommendation
from Jiu Jitsu Studio ownerCarlos Tadanado Rocha
Letters of
Recommendation
and Support from
Neighboring
Businesses

To whom it may concern,
As the general manager of three locations, I was admittedly skeptical of a cannabis dispensary moving in next door to one of our locations.

I can honestly state after 8 months of operation, the business led Devin Stetler and his partner Bert Sarkis has proven to be a well-oiled machine.

Their management team as well as their security personnel have been friendly, respectful, and courteous. My reservations about cannabis dispensaries have diosappeared as they have proven to be a high quality business and actually helped to clean up the area’s homeless, loitering, and littering!
Thanks,
Nick Pineda
General Manager
5 Star Auto Sales, Inc. 1443 Mitchell Rd. Modesto, CA 95351 5 STAR AUTO SALES, INC.  209.538.9000  [email protected] AutoZone | 2225 Patterson Road Riverbank, CA 95367 | (209) 863-8295 Dear Sir/Madam,
My name is Thomas Milam and I am the Manager of AutoZone in Riverbank, CA. When Flavors dispensary was announced as coming soon to the commercial building adjacent ours, I was admittedly furious. To me it was absurd for the City of Riverbank to even consider such a business especially in this area and I was the one right next door left to deal with them.

They have now been operating for nearly 7 months. We did voice our concerns about people parking in our lot and shopping there. Devin responded quickly and added parking signs which helped tremendously and showed they were willing to be cooperative neighbors. Over time, I’ve seen what a clean and secure operation Devin’s business is here and it has not attracted any unwanted elements I suspected it would. It’s clear that Devin and his team are leading the new era of legal cannabis in a safe, clean, and friendly manner.

We’ve also benefitted from added security in the parking lots and an increase in customer traffic to our store. I’m looking forward to an ongoing good relationship with the owners of Flavors. I can now report I’m glad the city has chosen them over others because of what a professional and tidy operation they are running here in Riverbank.

Respectfully,
Thomas Milam
Store Manager
AutoZone Riverbank
GUARANTY HOLDINGS OF CALIFORNIA – 1407 MITCHELL RD. MODESTO, CA 95351 -- (209) 537-4500

GHOC, INC.
1407 MITCHELL RD. MODESTO, CA 95351
To whom it may concern,
The unknown element of a dispensary opening just a few hundred feet from our main office had me admittedly assuming the worst. I can happily report after 8 months of working next door to each other that we have only seen positive improvements to the area. The presence of live security guards and lots of cameras have dramatically reduced the crime and loitering we experienced in the area pretty regularly before. I couldn’t be happier with the City of Ceres choosing dispensary owners Devin Stetler and Bert Sarkis who have been friendly and responsible neighbors and a definite improvement to the neighborhood.

Sincerely,
Renee Atwood
President
Guaranty Holding of California, Inc.

CITY LEADERS
Letters of
Recommendation
and Support from
City Leadership
Letter of Recommendation
from Mayor of Ceres
Letter of Recommendation
from City Manager of Ceres
Letter of Recommendation
from Mayor of Riverbank
Letter of Recommendation
from City Manager of
Riverbank
Letter of Recommendation
from Ceres Councilmember
Vierra
Letter of Recommendation
from Riverbank City
Council Member Cruz
Letter of Recommendation
from Riverbank City
Council Member Campbell
Letter of Recommendation
from Riverbank Planning
and Building Department
Letter of Recommendation
from Riverbank Community
Development Department
Letter of Recommendation
from Modesto Police
Department

SMOKE SHOPS
These are the search results
for “Fentanyl found in
smoke shops”
These are the search results
for “Fentanyl found in
dispensaries”
As you can see, most
fentanyl results tie back to
smoke shops.

WWW.HELTONINVESTIGATIONS.COM
[email protected]
This report was prepared in anticipation of litigation, and is considered CONFIDENTIAL, privileged, and attorney work product under CCP 2018.

Page
1 Hayward Smoke Shop Ordinance Compliance Investigation Objective:

To determine if Smoke Shops in the City of Hayward are selling unauthorized merchandise such as flavored cigarettes, Stiizy, Geek Bars (flavored vapes) or merchandise with Cannabis/THC content.

Summary:

On Thursday, October 2nd, 2025, during the afternoon and early evening hours purchases of restricted merchandise were attempted at twenty (20) smoke shops in the City of Hayward.

There were twenty (20) smoke shops identified within the city limits of Hayward. Seven (7) of the smoke shops are no longer in business at the locations identified. There were thirteen (13) shops still in operation and all but three (3) sold restricted merchandise to us.

Smoke shops identified – 20
Smoke shops out of business – 7
Smoke shops selling restricted merchandise – 10
Smoke shops who did not have restricted merchandise - 3 On Thursday, October 9, we visited the thirteen (13) shops in operation within the city limits of Hayward. On this date all the shops sold us restricted merchandise.

Smoke shops identified – 13
Smoke shops selling restricted merchandise – 13
It should be noted that none of the smoke shops except one had the restricted merchandise on display. All the restricted merchandise was concealed in boxes, bags, in the backroom of the shop or in one case the trunk of a car parked outside the shop.

WWW.HELTONINVESTIGATIONS.COM
[email protected]
This report was prepared in anticipation of litigation, and is considered CONFIDENTIAL, privileged, and attorney work product under CCP 2018.

Page
2 Investigation – October 2, 2025 :

Heart of the Bay - 22515 Alice Street
Indian male clerk 40 years old, clean shaven. He sits in the building next door until a customer arrives. The clerk had the items concealed in a grocery bag near the counter.

Blazin Jays – 22321 Redwood Road, Castro Valley
The clerk was an Indian male, about 35 years old and clean shaven. He had the products under the counter.

WWW.HELTONINVESTIGATIONS.COM
[email protected]
This report was prepared in anticipation of litigation, and is considered CONFIDENTIAL, privileged, and attorney work product under CCP 2018.

Page
3 Twilight Zone – 24058 Mission Blvd.

The clerk was a Hispanic female. She acquired the products from the backroom of the store.

Hip Hop Smoke Shop – 24289 Mission Blvd.

The clerk was a middle eastern male 18-25 years old. He went to the backroom of the store to get the products.

WWW.HELTONINVESTIGATIONS.COM
[email protected]
This report was prepared in anticipation of litigation, and is considered CONFIDENTIAL, privileged, and attorney work product under CCP 2018.

Page
4 Cigarettes Dealer – 26953 Mission Blvd.

The clerk was a young middle eastern male. He acquired the products from under the counter and the backroom.

Everest Smoke Shop – 24703 Amador Street
The clerk was a young Hispanic female. She acquired the property from a backroom.

WWW.HELTONINVESTIGATIONS.COM
[email protected]
This report was prepared in anticipation of litigation, and is considered CONFIDENTIAL, privileged, and attorney work product under CCP 2018.

Page
5 Smokey’s Smoke Shop – 25088 Hesperian Blvd.

The clerk was a middle eastern male, 30-40 years old. He had the products in two black boxes by the counter.

Cigarettes 4 Less – 25125 Santa Clara Street
The clerk was an Indian male 30-40 years old. He had the product in the backroom.

WWW.HELTONINVESTIGATIONS.COM
[email protected]
This report was prepared in anticipation of litigation, and is considered CONFIDENTIAL, privileged, and attorney work product under CCP 2018.

Page
6 Kingz – 1806 Whipple Road
The clerk was a middle eastern male, 30-40 years old. He had the product under the counter.

Star Zone – 18884 Hesperian Blvd.

The clerk was a younger Indian male about 22 years old. He acquired the product from the back of the store.

WWW.HELTONINVESTIGATIONS.COM
[email protected]
This report was prepared in anticipation of litigation, and is considered CONFIDENTIAL, privileged, and attorney work product under CCP 2018.

Page
7 The following smoke shops did not have restricted items available on October 2.

Smoker Friendly – 24068 Grand Street
City Cigarette – 27072 Hesperian Blvd.

Smoke Shop NU Fashion – 1104 W. Tennyson Road
Smoke shops out of business:

Cigarettes Cheaper - 638 A Street
The Gr8 Smoke Shop – 1090 La Playa Drive
Black and Orange Smoke Shop & Gift Shop – 24901 Santa Clara Street A Street Wireless & Tobacco – 497 W A Street
Cigarette Outlet – 414 W Harder Road
American Vapor – 20900 Corsair Blvd.

Best Choice Electronic Cigarettes – 26250 Industrial Blvd.

WWW.HELTONINVESTIGATIONS.COM
[email protected]
This report was prepared in anticipation of litigation, and is considered CONFIDENTIAL, privileged, and attorney work product under CCP 2018.

Page
8 Investigation – October 9, 2025 :

Star Zone – 18884 Hesperian Blvd.

The clerk was an Indian male 35 to 40 years old sitting in front of the store smoking. When we went into buy he directed the customer to point to a business card in the future if he wants vapes, not to say vapes.

He also gives a free drink when you point out the card.

Heart of the Bay – 22515 Alice Street
The clerk is an Indian male 40 years old, clean shaven, average height and weight. He sits next door and waits for customers. The clerk had the items concealed in a grocery bag near the counter.

WWW.HELTONINVESTIGATIONS.COM
[email protected]
This report was prepared in anticipation of litigation, and is considered CONFIDENTIAL, privileged, and attorney work product under CCP 2018.

Page
9 Twilight Zone – 24058 Mission Blvd.

Indian male clerk 25 to 30 years old. The clerk goes into the backroom directly behind the cash register to get the products.

Hip Hop Smoke Shop – 24289 Mission Blvd.

The clerk is an Indian male, 18 to 20 years old, with a goatee. The products were in a black bag underneath the cash register.

WWW.HELTONINVESTIGATIONS.COM
[email protected]
This report was prepared in anticipation of litigation, and is considered CONFIDENTIAL, privileged, and attorney work product under CCP 2018.

Page10
Smoker Friendly – 24068 Grand Street
Clerk was a younger Indian male with a goatee, light skin. The product was in the backroom.

Everest Smoke Shop – 24703 Amador Street
The clerk is a Mexican female, 22 to 23 years old, medium build. The products were in the backroom.

WWW.HELTONINVESTIGATIONS.COM
[email protected]
This report was prepared in anticipation of litigation, and is considered CONFIDENTIAL, privileged, and attorney work product under CCP 2018.

Page11
Hi
Cigarette outlet - 414 W Harder Rd.

Middle Eastern mail 35 to 40 years old heavy set was the clerk working the counter. The product was in the backroom, and he offered a business card with a stamp. Buy 5 and get one for free.

Cigarettes Dealer - 26953 Mission Blvd.

The clerk was an Indian male 25 to 30 years old and overweight. He went to the backroom to get the products.

WWW.HELTONINVESTIGATIONS.COM
[email protected]
This report was prepared in anticipation of litigation, and is considered CONFIDENTIAL, privileged, and attorney work product under CCP 2018.

Page12
Kingz - 1806 Whipple Rd.

The clerk was an Indian male 25 to 30 years old, he had blonde spikes in his hair. The product was in the backroom of the store.

Smoke Shop NU Fashion – 1104 W Tennyson Road
The clerk was a Hispanic male about 19 years old, overweight. The marijuana product was under the counter but the vapes were displayed next to the register.

WWW.HELTONINVESTIGATIONS.COM
[email protected]
This report was prepared in anticipation of litigation, and is considered CONFIDENTIAL, privileged, and attorney work product under CCP 2018.

Page13
City Cigarette - 27072 Hesperian Blvd.

The clerk was an Indian male adult, 30 to 35 years old, medium build and no facial hair. We were unable to buy here last time. This time he had product, but it was in the trunk of a car. We believe the vehicle is a black Lexus with personal plates, California license plate 1KBLAFG.

WWW.HELTONINVESTIGATIONS.COM
[email protected]
This report was prepared in anticipation of litigation, and is considered CONFIDENTIAL, privileged, and attorney work product under CCP 2018.

Page14
Smokey’s Smoke Shop - 25088 Hesperian Blvd.

The clerk was a black male adult with a full Afro wearing a mask. The product was inside two black boxes within the counter. The clerk had the customer pick what products he wanted.

Blazin Jays – 22321 Redwood Road, Castro Valley
The clerk was an Indian male, about 35 years old and clean shaven. He had the products under the counter.

WWW.HELTONINVESTIGATIONS.COM
[email protected]
This report was prepared in anticipation of litigation, and is considered CONFIDENTIAL, privileged, and attorney work product under CCP 2018.

Page15
Smoke shops out of business:

Cigarettes Cheaper - 638 A Street
The Gr8 Smoke Shop – 1090 La Playa Drive
Black and Orange Smoke Shop & Gift Shop – 24901 Santa Clara Street A Street Wireless & Tobacco – 497 W A Street
American Vapor – 20900 Corsair Blvd.

Best Choice Electronic Cigarettes – 26250 Industrial Blvd.

Smoke shop missed: Cigarettes 4 Less – 25125 Santa Clara Street Conclusion:

During my 34 years in law enforcement, I conducted hundreds of investigations related to sales of controlled substances. The covert way the smoke shops are selling these restricted items impresses me that they know the items are illegal and that their sales are restricted at the smoke shop level.

Please feel free to contact me if you have any questions. I can be reached at 209-678-4676.

Tim Helton

HAYWARD SMOKE SHOPS
Name Address
Cigarettes Cheaper 638 A St, Hayward, CA 94541
Heart Of The Bay Smoke Shop 22515 Alice St, Hayward, CA 94541 Star Zone Smoke Shop 18884 Hesperian Blvd, Hayward, CA 94541 Twilight Zone Gift & Smoke Shop 24058 Mission Blvd, Hayward, CA 94544 Hiphop Smoke Shop / Green Monkey
Smoke Shop? 24289 Mission Blvd, Hayward, CA 94544
Smoker Friendly 24068 Grand St, Hayward, CA 94541
Everest Smoke Shop 24703 Amador St #8, Hayward, CA 94544 The Gr8 Smoke Shop 1090 La Playa Dr, Hayward, CA 94545
25125 Santa Clara St, Hayward, CA 94544
Cigarette Outlet 414 W Harder Rd, Hayward, CA 94544
Smokey's Smoke Shop / Vape Shop & Gifts 25088 Hesperian Blvd, Hayward, CA 94545 Cigarettes Dealer / Smok shop tobacco
world and wirless 26953 Mission Blvd, Hayward, CA 94544 City Cigarette 27072 Hesperian Blvd, Hayward, CA 94545
Smok Shop Nu Fashion 1104 W Tennyson Rd # A, Hayward, CA 94544 KINGZ Shop & More 1806 Whipple Rd, Union City, CA 94587 Black and Orange Smoke & Giftshop 24901 Santa Clara St, Hayward, CA 94544 A Street Wireless & Tobacco 497 W A St, Hayward, CA 94541 American Vapor Corporation 20900 Corsair Blvd. Hayward, CA 94545 Best Choice Electronic Cigarettes 26250 Industrial Blvd STE 30, Hayward, CA 94545 Cigarettes 4 Less

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Letters of
Recommendation
and Support for
Esther Lopez

CITY OF HAYWARD Hayward City Hall
777 B Street
Hayward, CA 94541
www.Hayward-CA.gov
File #: LB 25-041
DATE: December 16, 2025
TO: Mayor and City Council
FROM: City Attorney
City Clerk

SUBJECT
Hayward Municipal Code Update: Introduction of an Ordinance Amending Sections 2-13.02, 2-13.04 and 2-13.06 of Article 13 of Chapter 2 of the Hayward Municipal Code Relating to Revised Voluntary Campaign Expenditure and Contribution Limits

RECOMMENDATION
That the City Council introduces the attached ordinance (Attachment II) amending Sections 2-13.02, 2-

13.04 and 2-13.06 of Article 13 of Chapter 2 of the Hayward Municipal Code to revise the voluntary campaign expenditure and contribution limits for candidates for City Council, not including the Mayor.

SUMMARY
In 2024, the City initiated a detailed and lengthy process to convert its at-large elections for the six members of the City Council to district elections. The office of Mayor remains at large. Conversion to City Council districts is staggered, with Districts 1 and 6 up in November 2026, and Districts 2, 3, 4 and 5 up in November 2028. Hayward’s population is 162,500, as presented during the district conversion process and based on the 2020 census. There are approximately 27,000 residents in each of the six districts.

The proposed ordinance will revise the voluntary campaign expenditure and contribution limits for Council Member candidates in light of the conversion to district-based elections. The voluntary expenditure limit is proposed to be set at $50,000 with the voluntary contribution limit set at $1,500.

The office of Mayor will not be affected by the proposed revisions. The revisions will apply to candidates running during the 2026 election cycle.

ATTACHMENTS
Attachment I Staff Report
Attachment II Ordinance
CITY OF HAYWARD Page 1 of 2 Printed on 12/12/2025
powered by Legistar™
File #: LB 25-041
CITY OF HAYWARD Page 2 of 2 Printed on 12/12/2025
powered by Legistar™

Page 1 of 4 ends

DATE: December 16, 2025
TO: Mayor and City Council
FROM: City Attorney
City Clerk
SUBJECT: Hayward Municipal Code Update: Introduction of an Ordinance Amending Sections 2-13.02, 2-13.04 and 2-13.06 of Article 13 of Chapter 2 of the Hayward Municipal Code Relating to Revised Voluntary Campaign Expenditure and Contribution Limits

RECOMMENDATION
That the City Council introduces the attached ordinance (Attachment II) amending Sections 2-

13.02, 2-13.04 and 2-13.06 of Article 13 of Chapter 2 of the Hayward Municipal Code to revise the voluntary campaign expenditure and contribution limits for candidates for City Council, not including the Mayor.

Conversion to City Council districts is staggered, with Districts 1 and 6 up in November 2026, and Districts 2, 3, 4 and 5 up in November 2028. Hayward’s population is 162,500, as presented during the district conversion process and based on the 2020 census. There are approximately 27,000 residents in each of the six districts.1 The proposed ordinance will revise the voluntary campaign expenditure and contribution limits for Council Member candidates in light of the conversion to district-based elections.

The voluntary expenditure limit is proposed to be set at $50,000 with the voluntary contribution limit set at $1,500. The office of Mayor will not be affected by the proposed revisions. The revisions will apply to candidates running during the 2026 election cycle.

BACKGROUND
In 2002, the City enacted Municipal Code sec. 2-13.00, et seq., (Ordinance 02-192) establishing, among other things, campaign finance regulations for City elective offices which

1 HaywardCity_Adopted_All.pdf
2 Ordinance 02-19
https://portal.laserfiche.com/Portal/DocView.aspx?id=128601&repo=r-b6d2994c

Page 2 of 4 ends

are defined as six members of the City Council and the office of Mayor. These regulations allow candidates to agree to voluntary expenditure and contribution limits, and regulations for candidates who choose not to accept voluntary limits. When first enacted, the limits were set as provided in Table I below. When candidates accept voluntary limits on how much they will spend on campaign activities, the ordinance allows the candidate to accept higher amounts of contributions per person.

Per the regulations, the City Clerk is authorized to adjust the limits annually by a percentage equal to the San Francisco Bay Area All Urban Consumer Price Index (CPI). On January 24, 2025, the City Clerk published the 2025 Notice of Campaign Contribution/Expenditure Limit.3 Table I: Existing Hayward Contribution and Expenditure Limits Candidates that Accept Voluntary
Limits
Candidates that Do Not Accept
Voluntary Limits

YEAR EXPENDITURE
LIMIT

CONTRIBUTION
LIMIT

EXPENDITURE
LIMIT

CONTRIBUTION
LIMIT
2002 $50,000 $1,000 No limit $250
2025 $91,096 $1,784 No limit $410
For further reference, pursuant to Assembly Bill 571 (Chapter 556, AB 571 Mullin), beginning January 1, 2021, state law applies a default contribution limit to city and county candidates when the jurisdiction has not enacted a contribution limit. The 2025-2026 state contribution limit is set at $5,900 for jurisdictions that have not enacted limits. Hayward was not affected by provisions enacted in 2021 because there is an ordinance in place. The Fair Political Practices Commission has created a repository of all cities, counties, and districts within California that have established their own contribution limit ordinances.4 On October 7, 2025 the City Council held a work session to consider potential adjustments to the existing campaign finance limits in light of Hayward’s transition to district elections. A consensus of the Council supported the following adjustments:
 Voluntary expenditure limit - $50,000.
 Voluntary contribution limit - $1,500.

The Council agreed that the office of the Mayor should retain the existing voluntary expenditure and contribution limits. There was also agreement that the new limits would apply to candidates running in the 2026 election cycle.

3 2025 Notice of CPI Adjustment/Voluntary Limit Form
Statement of Acceptance or Rejection of Voluntary expenditure limit for candidates for mayor or city council | City of Hayward - Official website
4 Local Campaign Ordinance
https://www.fppc.ca.gov/the-law/local-ordinances.html

Page 3 of 4 ends

DISCUSSION
Consistent with the Council’s feedback from the October 7, 2025 work session, staff recommends the voluntary expenditure and contribution limits for the office of Mayor shall remain in effect and adjusted by a percentage equal to the San Francisco Bay Area All Urban Consumer Price Index (CPI), consistent with prior-year practice. The voluntary expenditure limit for the office of Council Member shall be set at $50,000, and the contribution limit set at $1,500, with both limits adjusted annually thereafter in accordance with the CPI. Staff believes these limits balance the goal of creating equitable and competitive campaigns with a realistic assessment of the cost to run a modern campaign in a district of approximately 27,000 residents.

The City’s campaign finance regulations do not, as a practical matter, affect independent expenditures for or against candidates. Since 2015, the City’s regulations5 have required reporting of such expenditures, including the three largest contributors in certain kinds of advertising. It is acknowledged, however, that independent expenditures have an increasing impact on elections at all levels of government.

The existing regulations related to contribution limitations for candidates who do not accept the voluntary expenditure limits were not a point of discussion during the prior work session.

Consequently, the existing regulations and contribution limits for Mayor and Council Member candidates will remain unchanged for the upcoming election cycle. Staff will monitor the data related to this category of candidates during the November 2026 election and determine if amendments to those regulations are necessary.

NEXT STEPS
If the Council introduces the attached ordinance, staff will return to the City Council for adoption during the January 20, 2026 City Council meeting. The ordinance will take effect 30 days after adoption.

FISCAL IMPACT
There is no fiscal impact associated with this action.

STRATEGIC INITIATIVES
The agenda item is a routine operational item and does not relate to one of the Council’s Strategic Initiatives.

5 Ordinance 15-29
Ordinance No. 15-29 | Municipal Code | Hayward, CA | Municode Library

Page 4 of 4 ends

Prepared and recommended by: Michael Lawson, City Attorney Miriam Lens, City Clerk
Approved by:

Jennifer Ott, City Manager

ATTACHMENT II

Page 1 of 6 ends

ORDINANCE NO. 25-______

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF HAYWARD AMENDING SECTIONS 2-13.02, 2-13.04 AND 2-13.06 OF ARTICLE 13, CHAPTER 2 OF THE

HAYWARD MUNICPAL CODE RELATING TO REVISED VOLUNTARY CAMPAIGN EXPENDITURE AND CONTRIBUTION LIMITS.

THE CITY COUNCIL OF THE CITY OF HAYWARD DOES ORDAIN AS FOLLOWS:

Section 1. Sections 2-13.02, 2-13.04 and 2-13.06 of Article 13, Chapter 2 of the Hayward Municipal Code are amended to read as follows, with deleted terms shown in strikeout and added terms underlined:

ARTICLE 13

CAMPAIGN CONTRIBUTION PRACTICES FOR CITY ELECTIVE OFFICES

AND BALLOT MEASURES
SECTION 2-13.02 VOLUNTARY EXPENDITURE LIMITS FOR CAMPAIGNS FOR CITY ELECTIVE OFFICES.
a. A voluntary expenditure limit of sixty-six thousand nine dollars ($66,009.00) per candidate or controlled committee is hereby established for each election to City elective office. The amount established by this section shall be annually adjusted by a percentage equal to the San Francisco Bay Area All Urban Consumer Price Index (CPI). The City Clerk shall calculate such increase and post the expenditure limit in a visible place in the City Clerk's Office and on the City's website. b. Prior to accepting any contribution for a campaign, each candidate for City elective office or controlled committee shall file with the Hayward City Clerk a statement of acceptance or rejection of the voluntary expenditure limit established herein with regard to that campaign.
c. No candidate for City elective office who accepts the voluntary expenditure limit established herein and no controlled committee of such a candidate shall make campaign expenditures cumulatively in excess of the voluntary expenditure limit established herein.
d. Each candidate for City elective office or controlled committee who rejects the voluntary expenditure limit established herein shall be subject to the

ATTACHMENT II

Page 2 of 6 ends

contribution limit set forth in section 2-13.03 of this Article as that section may be amended from time to time.
a. A voluntary expenditure limit per candidate or controlled committee is hereby established for each district election for City Council or general election for the office of Mayor, as follows:

1. Candidates in District Elections for City Council. Fifty thousand dollars ($50,000.00).

2. Candidates in General Elections for Office of the Mayor. Ninety-one thousand ninety six dollars ($91,096.00)
b. Annual Adjustment. The amount established by this section shall be annually adjusted by a percentage equal to the San Francisco Bay Area All Urban Consumer Price Index (CPI). The City Clerk shall calculate such increase and post the expenditure limit in a visible place in the City Clerk's Office and on the City's website.
c. Prior to accepting any contribution for a campaign, each candidate for City elective office or controlled committee shall file with the Hayward City Clerk a statement of acceptance or rejection of the voluntary expenditure limit established herein with regard to that campaign.
d. No candidate for City elective office who accepts the voluntary expenditure limit established herein and no controlled committee of such a candidate shall make campaign expenditures cumulatively in excess of the voluntary expenditure limit established herein.
e. Each candidate for City elective office or controlled committee who rejects the voluntary expenditure limit established herein shall be subject to the contribution limit set forth in section 2-13.03 of this Article as that section may be amended from time to time.

SEC. 2-13.04 CONTRIBUTION LIMITATIONS FOR CANDIDATES ACCEPTING EXPENDITURE LIMITATIONS.
a. If a candidate accepts the expenditure limit set forth in section 2-13.02 of this Article, no person shall make to any candidate for City elective office, or the candidate's controlled committee, a contribution or contributions totaling more than one thousand two hundred ninety-five dollars ($1,295.00) for each election in which the candidate is attempting to be on the ballot or is a write-in candidate.

ATTACHMENT II

Page 3 of 6 ends

b. If a candidate accepts the expenditure limit set forth in section 2-13.02 of this Article, no candidate running for City elective office, or the candidate's controlled committee, shall accept a contribution or contributions totaling more than one thousand two hundred ninety-five dollars ($1,295.00) per person for each election in which the candidate is attempting to be on the ballot or is a write-in candidate.
c. The amounts established by this section shall be adjusted annually by a percentage equal to the San Francisco Bay Area All Urban Consumer Price Index (CPI). The City Clerk shall calculate such increase and post the contribution limit in a visible place in the City Clerk's Office and on the City's website.

In each election where a candidate in a district election for City Council or a general election for the office of Mayor accepts the expenditure limit as set forth in this Article, the following contribution limitations shall apply:
a. Candidate in District Elections for City Council:

1. No person shall make to any candidate or their controlled committee, a contribution or contributions totaling more than one thousand five hundred dollars ($1,500); and

2. No candidate or their controlled committee shall accept contributions from a person totaling more than one thousand five hundred dollars ($1,500) cumulative between the candidate and their committee.
b. Candidate in General Elections for the Office of the Mayor:

1. No person shall make to any candidate or their controlled committee, a contribution totaling more than one thousand seven hundred eighty-four dollars ($1,784); and

2. No candidate or their controlled committee shall accept contributions from person totaling more than one thousand seven hundred eighty-four dollars ($1,784) cumulative between the candidate and their committee. c. The amounts established by this section shall be adjusted annually by a percentage equal to the San Francisco Bay Area All Urban Consumer Price Index (CPI). The City Clerk shall calculate such increase and post the contribution limit in a visible place in the City Clerk's Office and on the City's website.

SEC. 2-13.06 PERSONAL LOANS.

ATTACHMENT II

Page 4 of 6 ends

a. A candidate may take out personal loans for campaign purposes. Withdrawal of funds from a candidate's personal bank account or savings account does not constitute a loan. If a candidate has accepted the voluntary expenditure limits pursuant to Section 2-13.02, any personal or bank loans taken out by the candidate will count towards his or her voluntary expenditure limit. b. If any person, including a relative or friend of the candidate, gives or loans the candidate money in connection with his or her campaign, these funds are considered a contribution from the donor to the candidate's campaign, and is subject to the campaign expenditure limits set forth in Sections 2-13.02 and 2-

13.03. This is true even if the candidate uses the funds for personal living expenses while campaigning.
c. Personal bank loans are not considered contributions from the bank. Such loans must be taken out solely in the name of the candidate from a commercial lending institution. If a person cosigns or guarantees a loan with a candidate, even if a relative or friend, that loan would be considered a contribution and subject to the expenditure limits set forth in Sections 2-13.03 and 2-13.04. The candidate must file notice of the loan with the City Clerk within seven (7) days or receiving the loan proceeds. Both the candidate and the commercial lending institution must be disclosed as the sources of the loan.
d. A candidate who does not accept the voluntary expenditure limits of Section 2-

13.02 may make a series of personal loans to his or her campaign as long as the outstanding balance does not exceed one hundred thousand dollars ($100,000.00) at the time of making the loans. If a candidate's personal loan balance has reached the one hundred thousand dollar ($100,000.00) limit, the loan balance must be reduced before the candidate may make any additional loans to his or her campaign.
e. Candidates who accept the voluntary expenditure limits of Section 2-13.02 may make a series of personal bank loans to his or her campaign as long as the outstanding balance does not exceed sixty-six thousand nine dollars ($66,009.00), or whatever amount constitutes the current voluntary expenditure limit as calculated by the City Clerk, at the time of making the loans. If a candidate's personal bank loan balance has reached the voluntary expenditure limit, the loan balance must be reduced before the candidate may make any additional bank loans to his or her campaign.
a. A candidate may take out personal loans for campaign purposes. Withdrawal of funds from a candidate's personal bank account or savings account does not constitute a loan.

ATTACHMENT II

Page 5 of 6 ends

b. Personal bank loans are not considered contributions from the bank. Such loans must be taken out solely in the name of the candidate from a commercial lending institution.

If a person cosigns or guarantees a loan with a candidate, even if a relative or friend, that loan would be considered a contribution. The candidate must file notice of the loan with the City Clerk within seven (7) days of receiving the loan proceeds. The candidate, the co-signer and the commercial lending institution must be disclosed as the sources of the loan.
c. Candidates who accept the voluntary expenditure limits of Section 2-13.02 may make a series of personal bank loans to his or her campaign as long as the outstanding principal balance does not exceed the amounts set forth below, or whatever amount constitutes the current voluntary expenditure limit as calculated by the City Clerk, at the time of making the loans:

1. Candidate in District Elections for City Council. Fifty thousand dollars ($50,000.00).

2. Candidate in General Elections for the Office of the Mayor. Ninety-one thousand ninety six dollars ($91,096.00).

3. If a candidate's personal bank loan balance has reached the voluntary expenditure limit, the loan balance must be reduced before the candidate may make any additional bank loans to his or her campaign.
d. A candidate who does not accept the voluntary expenditure limits of Section 2-13.02 may make a series of personal loans to his or her campaign as long as the outstanding principal balance does not exceed one hundred thousand dollars ($100,000.00) at the time of making the loans. If a candidate's personal loan principal balance has reached the one hundred thousand dollar ($100,000.00) limit, the loan balance must be reduced before the candidate may make any additional loans to his or her campaign. e. If any person, including a relative or friend of the candidate, gives or loans the candidate money in connection with his or her campaign, these funds are considered a contribution from the donor to the candidate's campaign.

Section 2. California Environmental Quality Act. Adoption of this Ordinance is exempt from environmental review as the adoption of this Ordinance does not qualify as a “project” pursuant to the California Environmental Quality Act (“CEQA”), under Public Resource Code Section 21065 and CEQA Guidelines Section 15320, 15378, and 15061(b) (3) as there is no possibility that such action would cause either a direct, or reasonably foreseeable indirect, physical change in the environment.

Section 3. If any section, subsection, paragraph, or sentence of this Ordinance, or any part thereof, is for any reason found to be unconstitutional, invalid, or beyond the authority of

ATTACHMENT II

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the City of Hayward by a court of competent jurisdiction, such decision shall not affect the validity or effectiveness of the remaining portions of this Ordinance.

Section 4. The effective date of this Article shall be thirty (30) days after its adoption by the City Council.

INTRODUCED at a regular meeting of the City Council of the City of Hayward, held the ___ day of __, 2025, by Council Member _______, ADOPTED at a regular meeting of the City Council of the City of Hayward, held the ___ day of ______, 2025, by the following votes of members of said City Council.

AYES: COUNCIL MEMBERS:

MAYOR:

NOES: COUNCIL MEMBERS:

ABSTAIN: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:

APPROVED: ___________________________________
Mayor of the City of Hayward

DATE: ___________________________________________

ATTEST: ________________________________________
City Clerk of the City of Hayward
CITY OF HAYWARD Hayward City Hall
777 B Street
Hayward, CA 94541
www.Hayward-CA.gov
File #: LB 25-046
DATE: December 16, 2025
TO: Mayor and City Council
FROM: City Attorney
Police Chief
Development Services Director

SUBJECT
Temporary Moratorium: Adopt an Interim Urgency Ordinance Pursuant to Government Code Section 65858, Imposing a Temporary Moratorium on New Massage Businesses in Hayward, and Finding that the Action is Exempt from Environmental Review

RECOMMENDATION
That the City Council adopts an interim urgency ordinance (Attachment II) imposing a temporary moratorium on new massage businesses in Hayward and finds that the action is exempt from environmental review under the California Environmental Quality Act (CEQA).

SUMMARY
Hayward Police Department (HPD) has become aware of instances of commercial sex work taking place at permitted and unpermitted massage businesses within the City. As a result, staff recommends that the City Council impose a temporary moratorium on new massage businesses in Hayward to allow time for city staff to develop a more effective approach to addressing this issue via land use approval and operational regulation of these businesses. During this moratorium no conditional use permits, massage permits, or business licenses would be issued for new massage establishments or existing establishments undergoing a change of ownership. Under current zoning regulations, massage businesses are allowed by right in the downtown core, but require a conditional use permit in some other commercial areas, and are completely prohibited in other parts of the city. Additionally, massage businesses must obtain an operating permit (massage permit) from HPD pursuant to Hayward Municipal Code Chapter 6, Article 10.

State law (Government Code section 65858) authorizes, as a means of protecting public health, safety and welfare, the adoption of an interim ordinance to establish a temporary moratorium on specified uses that may be in conflict with a contemplated general plan, specific plan, or zoning proposal that the City is considering, studying, or intends to study within a reasonable time. The urgency ordinance requires a 4/5 vote of the legislative body and can last for up to 2 years (45 day initial term with initial extension up to 10 months, 15 days and subsequent extension up to 1 year).

CITY OF HAYWARD Page 1 of 2 Printed on 12/12/2025
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File #: LB 25-046

ATTACHMENTS
Attachment I Staff Report
Attachment II Ordinance
CITY OF HAYWARD Page 2 of 2 Printed on 12/12/2025
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DATE: December 16, 2025
TO: Mayor and City Council
FROM: City Attorney
Development Services Director
Police Chief
SUBJECT: Temporary Moratorium: Adopt an Interim Urgency Ordinance Pursuant to Government Code section 65858, Imposing a Temporary Moratorium on New Massage Businesses in Hayward, and Finding that the Action is Exempt from Environmental Review

During this moratorium no conditional use permits, massage permits, or business licenses would be issued for new massage establishments or existing establishments undergoing a change of ownership. Under current zoning regulations, massage businesses are allowed by right in the downtown core, but require a conditional use permit in some other commercial areas, and are completely prohibited in other parts of the city. Additionally, massage businesses must obtain an operating permit (massage permit) from HPD pursuant to Hayward Municipal Code Chapter 6, Article 10.

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and can last for up to 2 years (45 day initial term with initial extension up to 10 months, 15 days and subsequent extension up to 1 year).

FISCAL IMPACT
Adoption of the ordinance provided herein will have no additional fiscal impact. Staff is already working on this topic within normally budgeted hours.

BACKGROUND
HPD has become aware of instances of commercial sex work taking place at permitted and unpermitted massage businesses within the City. Although there are mechanisms in place to revoke existing permits for these types of violations, the lack of land use controls for massage businesses downtown creates challenges in processing new operating permit applications, and increases the risk that these new establishments will become hosts for commercial sex activity and human trafficking. A temporary pause in the issuance of new permits for massage businesses would allow city staff to consider alternative approaches to land use approval and operational regulation of these businesses.

New land use regulations, including stricter controls around massage establishments, could be incorporated into the Business Friendly Hayward project, 1 an effort aimed at “right-sizing" the
use permit process among other things, which is currently underway and expected to be adopted in Spring 2026. The Planning Division is leading the Business Friendly Hayward Project and has already been in communication with HPD staff about potential changes to the Downtown Code, Zoning Ordinance, and Massage Permit Process to help address the issues discussed above. Additionally, HPD is collaborating with the City Attorney’s Office to develop amendments to the Massage Permit Ordinance to strengthen enforcement capabilities.

This item was presented to the Council Economic Development Committee on November 3, 2025.2 The Committee members were supportive of the proposal and recommended presentation to the full City Council.

DISCUSSION
Massage establishments in Hayward are regulated through the Zoning Ordinance (Chapter 10, Article 1) and the Massage Permit Ordinance (Chapter 6, Article 10). Under current zoning regulations, massage businesses are allowed by right in the Downtown core, 3 require a

1 Business Friendly Hayward Project: https://www.hayward-ca.gov/your-government/departments/planningdivision/business-friendly-hayward-project 2 CEDC Meeting, November 3, 2025:
https://hayward.legistar.com/LegislationDetail.aspx?ID=7721816&GUID=59B00704-AABA-41CF-8C1A669B6425EC1A&Options=&Search= 3 HMC Section 10-28.2.3.010, Downtown Use Table:
https://library.municode.com/ca/hayward/codes/municipal_code?nodeId=HAMUCO_CH10PLZOSU_ART28DECO_A RT10-28.2SPZO_DIV10-28.2.3USTA

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conditional use permit (CUP)4 in select commercial districts, and are prohibited in all other parts of the city.

The Massage Permit Ordinance5 requires massage establishment operators to obtain a permit issued by the Police Chief, subject to specific conditions such as background checks for all owners and employees, state certification for all massage therapists, and compliance with operational requirements. Failure to comply with the requirements of the Massage Permit Ordinance can lead to suspension or revocation of a massage permit.

The HPD Vice Unit is responsible for enforcing the massage permit regulations. The unit is staffed with a detective and a sergeant who are responsible for reviewing massage permit applications, conducting background checks on applicants, investigating complaints, and initiating enforcement actions when necessary.

There are currently 17 permitted massage establishments in Hayward, with 10 of those establishments having complaints of illicit activity. One business recently had its massage permit revoked after an investigation revealed commercial sex activity taking place at the location. Additionally, HPD is aware of five unpermitted massage businesses in the city.

The combination of staffing challenges and suboptimal regulatory tools increases the risk of bad operators who may be engaged in human trafficking and commercial sex work operating massage establishments in the city, which poses a significant threat to public health and safety.

Adoption of a temporary moratorium would allow staff an opportunity to assess how the current set of regulations can be modified to prevent and deter bad actors while ensuring that legitimate massage establishments have an opportunity to operate and provide massage services within the city.

Environmental Review - Adoption of this Ordinance is exempt from environmental review as the adoption of this Ordinance does not qualify as a “project” pursuant to the California Environmental Quality Act (“CEQA”), under Public Resource Code Section 21065 and CEQA Guidelines Section 15320, 15378, and 15061(b) (3) as there is no possibility that such action would cause either a direct, or reasonably foreseeable indirect, physical change in the environment.

STRATEGIC ROADMAP
This agenda item is a routine operational item and does not relate to any of the six priorities outlined in the Council’s Strategic Roadmap.

4 HMC Section 10-1.3200, Conditional Use Permit:
https://library.municode.com/ca/hayward/codes/municipal_code?nodeId=HAMUCO_CH10PLZOSU_ART1ZOOR_S1 0-1.3200COUSPE
5 HMC Chapter 6, Article 10, Massage Permit Ordinance:
https://library.municode.com/ca/hayward/codes/municipal_code?nodeId=HAYWARD_MUNICIPAL_CODE_CH6BU PRTR_ART10MAPEOR

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NEXT STEPS
If adopted by a 4/5 vote (6 affirmative votes) of the Council, the moratorium will be in place for 45 days initially. A second hearing is tentatively scheduled for January 20, 2026 to consider extension of the moratorium. State law allows the moratorium to be extended initially for a maximum period of 10 months, 15 days, with a final extension up to one (1) year. However, staff anticipates that such a lengthy extension will not be necessary. Updated regulations are tentatively scheduled to be brought to the Council for consideration in Spring 2026.

Prepared by: Michael Vigilia, Senior Assistant City Attorney Elizabeth Blanton, Senior Planner
Det. Gabrielle Wright, Hayward Police Department
Recommended by: Michael Lawson, City Attorney
Sara Buizer, Development Services Director
Bryan Matthews, Police Chief
Approved by:
______________________________________
Jennifer Ott, City Manager

ATTACHMENT II

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ORDINANCE NO. 25-______

AN INTERIM URGENCY ORDINANCE OF THE CITY COUNCIL OF THE CITY OF HAYWARD PURUSANT TO GOVERNMENT CODE SECTION 65858,

IMPOSING A TEMPORARY MORAOTRIUM ON NEW MASSAGE

BUSINESSES, AND FINDING THAT THE ACTION IS EXEMPT FROM

ENVIRONMENTAL REVIEW
WHEREAS, the City of Hayward ("City") is authorized under California Government Code Section 51030 et seq. to regulate a massage business when carried on within the City; and
WHEREAS, massage businesses are regulated pursuant to Hayward Municipal Code Chapter 6, Article 10 (Massage Permit Ordinance), Chapter 8, Article 1 (Business License Ordinance) and Chapter 10, Article 1 (Zoning Ordinance); and WHEREAS, the Hayward Police Department has become aware of instances of commercial sex work taking place at permitted and unpermitted massage businesses within the city, which have resulted in criminal investigations and prosecutions; and WHEREAS, there are currently 17 permitted massage establishments in the City, with 10 of those establishments having complaints of illicit activity; and WHEREAS, on October 8, 2025, the Police Chief revoked a massage establishment permit for a business in Downtown Hayward based on evidence of commercial sexual activity taking place on the premises; and
WHEREAS, the Hayward Police Department has conducted investigations related to alleged sexual acts at massage establishments in the City which necessitate the use of limited resources, and in some instances requires partnership with multiple agencies at both the local and state level, which divert resources from violent crimes and other threats to the City; and
WHEREAS, the current Police Department framework, which devotes one Seargent and one detective to the Vice Unit, does not afford adequate personnel and resources to effectively monitor massage establishments to ensure they are operating within the confines of local and state law; and

ATTACHMENT II

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Hayward City CouncilDecember 16, 2025

Hayward City Council
December 16, 2025