AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 276 of 362
-6-
12183-0001\2640491v4.doc
contractors and materialmen which provided services or installed supplies to or for the account of Tenant with respect to the Improvements;
(e) No default by Tenant has occurred and is continuing; and (f) Tenant has provided to Landlord two (2) sets of as -built plans and a disk with an electronic file (including both PDF and Computer Aided Design [ “CAD”] electronic versions) of all the Improvements.
Within thirty (30 ) days after Landlord’s final payment of the Tenant Improvement Allowance, Tenant shall submit to Landlord final, unconditional lien releases and waivers from any and all contractors and materialmen which provided services or installed supplies to or for the account of Tenant with respect to the Improvements.
5.3 Construction Contracts. All Improvements and any alterations thereto shall be performed only by competent and qualified contractors duly licensed under the laws of the State of California pursuant to written contracts with such contractors.
5.4 Landlord Has No Responsibility. It is expressly acknowledged and agreed that Landlord shall have no responsibility for performing any work in connection with processing of necessary approvals or for performing any work to the Premises in order to prepare the Premises for construction by Tenant, and that all work shall be performed by Tenant at Tenant’s sole cost and expense. Notwithstanding the foregoing, Landlord agrees to provide reasonable cooperation with Tenant’s processing of necessary approvals for the work in the Premises, including by signing documents as the owner of the Premises or by participating in meetings with governmental officials if required by such officials.
5.5 Compliance with Law and Quality . Tenant shall cause all Improvements to be performed/constructed: (a) in a workmanlike manner with only new and high quality building materials, (b) in compliance with all applicable building codes and other applicable laws, ordinances, regulations, and orders of all federal, state, county, and local governmental agencies or entities having jurisdiction over the Property, and (c) in compliance with all applicable insurance requirements. Without limiting the generality of the foregoing provisions, Tenant shall not permit any component of any Improvements to be commenced until all building permits and other governmental permits, licenses and approvals required in connection with such component have been issued.
5.6 Notices of Non-responsibility. Landlord shall, at any and all times during the Term, have the right to post and maintain on the Premises and to record as required by law any notice or notices of non-responsibility provided for by the mechanics’ lien laws of the State of California. Tenant shall give Landlord not less than thirty (30) days’ written notice prior to the commencement of any work (including site preparation work) or the delivery of building materials to the Premises.
5.7 Mechanics’ Liens. Tenant shall keep the Premises and all building and improvements now or hereafter located on the Premises free and clear of all liens and claims of liens for labor, services, materials, supplies, or equipment performed on or furnished to the Premises during the term of this Lease. In case of any such lien attaching or notice of any lien, the Tenant covenants and agrees to cause it to be immediately released and removed of record or the Landlord, at its sole
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 277 of 362
-7-
12183-0001\2640491v4.doc
option, may immediately take all action necessary to release and remove such lien and the Tenant shall upon demand reimburse the Landlord for all costs involved therewith. Should Tenant fail to pay and discharge or cause the Premises to be released from any such lien or claim of lien within thirty (30) days after service on Tenant of written request from Landlord to do so, Landlord may pay, adjust, compromise and discharge any such lien or claim of lien on such terms and manner as Landlord may deem appropriate. In such event, Tenant shall, on or before the first day of the next calendar month following any such payment by Landlord, reimburse Landlord for the full amount paid by Landlord in paying, adjusting, comprising, and discharging such lien or claim of lien, including any attorneys’ fees and other costs expended by Landlord, together with interest as provided in Section 20.7 from the date of payment by Landlord to the date of repayment by Tenant.
5.8 Notice of Completion. Upon completion of the Improvements, the Tenant agrees to cause a Notice of Completion to be recorded in the Riverside County Recorder’ s Office in accordance with Section 3093 of the California Civil Code or any successor statute, and the Tenant shall deliver to the Landlord a reproducible copy of the “as built” drawings of the Improvements accompanied by a certificate signed by Tenant’s architect and a Certificate of Occupancy from the applicable public authority.
5.9 Title of Improvements. Any and all improvements placed or erected on the Premises as well as any and all other alterations, additions, improvements and fixtures (except for improvements that are excluded from the Premises and also except for Tenant’s furniture and trade fixtures) made or placed in or on the Premises by Tenant shall be considered part of Premises, and shall remain on the Premises and, without compensation to Tenant, on the expiration or any earlier termination of this Lease shall become the sole property of Landlord or, if Landlord so elects and upon written notice to Te nant, shall be demolished and removed by Tenant from the Premises at Tenant’s sole expense. Tenant shall not remove any improvements from the Premises, commit or permit any waste, or destroy or modify any improvements on the Premises except as expressly permitted by this Lease.
5.10 Effect of Landlord Approvals ; Disclaimer. No approval by Landlord of any plans or specifications shall constitute (i) approval of architectural or engineering sufficiency or representation, or (ii) warranty by Landlord as to the ade quacy or sufficiency of the plans and specifications or the improvements contemplated for Tenant’s use or purpose. Landlord, by approving the plans and specifications, assumes no responsibility or liability for any defect in any improvements constructed on the basis of the plans and specifications.
ARTICLE 6
RENT AND PROPERTY TAXES
6.1 Rent. Tenant shall pay the Base Rent specified in Section 1.7 in monthly installments, in advance, on or before the first (1st) day of each month, without prior demand and without of fset, abatement or deduction, commencing on the Rent Commencement Date as defined in Section 1.6.
Should the Rent Commencement Date be a day other than the first (1st) day of a calendar month, then the monthly installment of Rent for the first partial month shall be prorated based on a 30-day month.
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 278 of 362
-8-
12183-0001\2640491v4.doc
6.2 Late Payments. If any Monthly Rent, or any other sum due, is not received by Landlord from Tenant within ten (10) days after the date when due, Tenant shall immediately pay to Landlord a late charge equal to five percent (5%) of such sum due, and Landlord and Tenant agree that this late charge represents a reasonable estimate of the direct and indirect costs, expenses and damages Landlord will incur as a result of Tenant’s late payment (which damages would be impractical and extremely difficult to calculate accurately) and is therefore fair compensation to Landlord for its loss suffered by reason of late payment by Tenant.
6.3 Place of Payment. Tenant shall pay Base Rent to Landlord at the first address for Landlord specified in Section 1.11, but with the addition of “Attn: Finance Department”, or to such other address and/or person as Landlord may from time to time designate in writing to Tenant.
6.4 Possessory Interest Taxes and Utilities. Tenant shall be responsible for g the payment when and as due of all real property taxes on Tenant’s possessory interest, and all charges for gas, electricity, telephone service, water, sewer service, trash removal and other utilities and services furnished to the Property during the Term.
LANDLORD HEREBY GIVES TENANT NOTICE, AND TENANT ACKNOWLEDGES
RECEIPT OF SUCH NOTICE, AS REQUIRED PURSUANT TO CALIFORNIA REVENUE AND TAXATION CODE SECTION 107.6, THAT THE LEASEHOLD INTEREST CREATED
BY THIS LEASE MAY C ONSTITUTE A POSSESSORY INTEREST SUBJECT TO
PROPERTY TAXATION AND AS A RESULT TENANT MAY BE SUBJECT TO A
POSSESSORY INTEREST TAX BEING LEVIED AGAINST THE PROPERTY AND/OR TENANT’S LEASEHOLD INTEREST, AND THAT TENANT SHALL BE OBLIGATED TO PAY SUCH TAX WHEN DUE TO THE LEVYING AUTHORITY.
6.5 Other Tenant Property Taxes . Tenant shall pay, prior to delinquency, all taxes, assessments, license fees and public charges levied, assessed or imposed upon its business operation, trade fixtures, merchandise and other personal properly in, on or upon the Premises. If any such items of property are assessed with property of Landlord, then the assessment shall be equitably divided by Landlord between Landlord and Tenant. If any such taxes on Tenant’s personal property or trade fixtures are levied against Landlord or Landlord’s property or if the assessed value of the Premises or the Premises is increased by Tenant’s construction of any alterations inclusion therein of a value placed upon such personal property or trade fixtures, Tenant shall pay the amount thereof as invoiced to Tenant by Landlord within thirty (30) days following Landlord’s delivery of such invoice together with reasonable evidence of such allocation.
ARTICLE 7
SECURITY DEPOSIT
Concurrently with Tenant’s execution of this Lease, Tenant shall deposit with Landlord the sum specified in Section 1.8 (“Security Deposit”), in cash. If Tenant defaults with respect to any provision of this Lease, including, but not limited to the provisions relating to the payment of rent, Landlord may (but shall not be required to) use, apply or retain all or any part of this Security Deposit for the payment of any rent or any other sum in default, or for the payment of any amount which Landlord may spend or become obligated to spend by reason of Tenant’s default, or to compensate Landlord for any other loss or damage which Landlord may suffer by reason of
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 279 of 362
-9-
12183-0001\2640491v4.doc
Tenant’s default. If any portion of the Security Deposit is so used or applied Tenant shall, within five (5) business days after written d emand therefor, deposit cash with Landlord in an amount sufficient to restore the Security Deposit to its original amount and Tenant’s failure to do so shall be a default under this Lease. Landlord shall not be required to keep the Security Deposit separate from its general funds, and Tenant shall not be entitled to interest on the Security Deposit. If Tenant shall fully and faithfully perform every provision of this Lease to be performed b y it, the Security Deposit or any balance thereof shall be returned to Tenant (or, at Landlord’s option, to the last assignee of Tenant’s interest hereunder) within ninety (90) days following expiration of the Term. If Landlord transfers its interest in the Premises, Landlord shall transfer the cash Security Deposit to Landlord’s successor in interest . TENANT HEREBY WAIVES THE PROVISIONS OF SECTION 1950.7 OF THE CALIFORNIA CIVIL CODE AND AGREES THAT THE FOREGOING PROVISIONS OF THIS ARTICLE 7 SHALL GOVERN LANDLORD’S USE AND RETURN OF THE SECURITY DEPOSIT.
ARTICLE 8
TENANT’S CONDUCT OF BUSINESS
8.1 Permitted Use. Tenant shall use the Premises solely for the use specified in Section 1.9 and for no other use or purpose. Tenant shall conduct its operations in a manner that shall not disturb other tenants or create a nuisance.
8.2 Covenant to Operate. From and after the date Tenant opens for business from the Premises, and except for closures beyond the Tenant’s control (such as damage/destruction), Tenant shall keep the entire Premises continuously open for business seven days a week and hours of operation to correspond with the uses at the Premises (afternoons and evenings for restaurant and brewery). Any modification of the days and times that the business shall be open for operation shall be approved by the Landlord, which approval can be granted or denied in Landlord’s sole discretion. Tenant shall make its best efforts towards providing music offerings and entertainment at the Premises during the week . Tenant shall have its exterior signs adequately illuminated continuously during at least those hours and days that the Premises are required to be open for business to the public.
8.3 Tenant’s Signs. Tenant shall not affix upon the exterior (or interior windows or doors) of the Premises any sign, advertising placard, name, insignia, trademark, descriptive material or other like item (collectively, the “Exterior Signs”), unless the Exterior Signs: (i) comply with all governmental requirements, and (ii) are approved by Landlord, in its proprietary capacity (and not as a part of governmental approval), in its sole and absolute discretion. All of the Exterior Signs shall be erected by Tenant at its sole cost and expense, shall be professionally prepared, and Tenant shall maintain all of its Exterior Signs in good condition and repair during the Term. Prior to the expiration, or upon earlier termination of this Lease, as applicable, Tenant shall remove all of its Exterior Signs and restore the areas on which the Exterior Signs were located to their condition prior to the installation of the Exterior Signs, all at Tenant’s sole cost and expense.
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 280 of 362
-10-
12183-0001\2640491v4.doc
ARTICLE 9
MAINTENANCE, REPAIRS AND ALTERATIONS
9.1 Tenant’s Maintenance Obligations. Tenant shall maintain in good condition and repair, the entirety of the Premises (except that portion of Premises to be maintained by Landlord under Section 9.2 below), including the Improvements and all Fixtures, and the HVAC syste ms as well as the landscaping and all parking areas (collectively, the "Premises Systems"). Notwithstanding, in case of complete HVAC failure or breakage that is beyond repair as documented by a third - party professional, Landlord and Tenant shall equally pay for the replacement HVAC system with Landlord and Tenant each paying 50% of the cost. In such case, Tenant shall obtain at least three bids, with Landlord having final approval of the contractor for such work.
9.2 Landlord’s Maintenance Obligations . Landlord shall repair, maintain in good and tenantable condition and replace, as necessary, the roof, exterior walls and structural components of the Premises (including the structural floor) and all meters, pipes, conduits, equipment (excluding heating, ventilation and air conditioning equipment), components and facilities that supply the Premises with utilities (except as the appropriate utility company has assumed these duties); provided however that Landlord shall not be required to make repairs necessitated by reason of any acts or omissions of Tenant, including negligence or willful misconduct of Tenant or anyone claiming under Tenant, by reason of the failure of Tenant to perform or observe any conditions or agreements of this Lease, or by reason of Improvements made by Tenant or anyone claiming under Tenant. Notwithstanding, in case the Premises requires a new roof for the entirety of the building as documented by a third -party professional, Landlord and Tenant shall equally pay for the replacement roof with Landlord and Tenant each paying 50% of the cost. In such case, Tenant shall obtain at least three bids, with Landlord having final approval of the contractor for such work.
9.3 Landlord’s Right of Entry . Landlord, its agents, contractors, servants and employees may enter the Premises following not less than twenty -four (24) hours prior writt en notice to Tenant (except in the event of an emergency, in which case no notice shall be required) and Landlord’s good faith efforts to coordinate such entry with Tenant’s on-site management so as to minimize interference with Tenant’s business operations (except in a case of emergency, in which case no notice shall be required): (a) to examine the Premises; (b) to perform any obligation or exercise any right or remedy of Landlord under this Lease; and (c) to cure Tenant’s failure to perform its obligatio ns under this Lease, including work necessary to comply with laws, ordinances, rules or regulations of any public authority.
9.4 Alterations. After initially opening the Premises for business, Tenant shall not make or cause to be made to the Premises any ad dition, renovation, alteration, or reconstruction without Landlords prior written consent, which includes alterations that (i) affect the exterior appearance of the Premises, fire sprinkler systems, exterior walls, the floor slab, or roof of the Premises, (ii) require or result in any penetration of the roof, demising walls or floor slab of the Premises, (iii) involve structural changes or additions, (iv) increase the level of services or utilities supplied, or (v) alterations to the building. Alterations to address normal wear and tear, alterations to comply with Section 9.1 above or alterations that do not require a building permit or other city permit are permitted without Landlord’s consent . Any request for consent to A lterations requiring consent shall be accompanied by two (2 ) complete sets of plans and specifications for the proposed
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 281 of 362
-11-
12183-0001\2640491v4.doc
Alterations suitable for submission to Landl ord for evaluation and a statement of the identity of the contractor who will perform such Alterations. Tenant shall pay all reasonable out -of-pocket costs incurred by Landlord in the evaluation, as applicable, of the plans and specifications . In addition, as a condition to Landlord’s granting of its consent to any Alterations, Landlord shall have the right to approve the architect, contractors, subcontractors designing or performing such Alterations, which approval shall not be unreasonably delayed, withheld or conditioned and shall be granted or denied within fifteen (15) business days (provided that in any event Premises standard subcontractors shall be used for work affecting structural portions, or base building mechanical and fire and life safety systems and utility systems so long as such subcontractors are competitively priced and reasonably available). All Alterations to be performed by Tenant in the Premises, including the delivery, storage and removal of materials, shall be reasonably scheduled through Landlord, and shall be performed in accordance with regulations imposed in good faith by Landlord. All Alterations (whether or not Landlord’s consent is required therefor) shall be completed in a good and workmanlike manner and in accordance with all a pplicable Laws. All Alterations requiring Landlord’s consent shall be completed in accordance with the approved plans and specifications therefor. Promptly following the completion of any Alterations where the preparation of “as -built” plans would be customary for the particular Alterations performed, Tenant shall deliver to Landlord both a “hard” copy and a copy on CAD diskette of the “as-built” plans and specifications (including all working drawings) for such Alterations. Promptly following the completion of any Alterations for which any governmental permit, approval or sign- off is required under applicable Laws, Tenant shall deliver to Landlord a copy of signed -off permits, inspection cards or other documentation evidencing governmental approval of completion of the work. Unless identified as by Landlord as having to be removed prior to Lease termination pursuant to Section 20.4, all of Tenant’s Alterations including, but not limited to, light fixtures, floor coverings and partitions, but excluding trade fixtures and signs, shall be deemed to be the property of Landlord upon installation thereof. Within thirty (30) days after the completion of any Alterations, Tenant shall deliver to Landlord a set of “as built” plans depicting the Alterations as actually constructed or installed. If Tenant shall make any permitted Alterations, Tenant shall carry “Builder’s All Risk” insurance in an amount reasonably determined by Landlord covering the construction of such Alterations and such other insurance as Landlord may reasonably require.
Any Alterations to the Premises which are required by reason of any future law, ordinance, rule, regulation or order of any governmental authority having jurisdic tion over the Premises , or any future change in any such existing law , ordinance, rule, regulation or order, and which does not pertain to the structural portions of the Premises, shall be at the sole cost of Tenant. Any inspection by Landlord of such Alterations shall in no event constitute Landlord’s approval of the work so performed, nor shall Landlord be responsible for or have any liability with respect to such inspections. If Tenant’s Alterations trigger: (i) required improvements for disabled access , or (ii) any other legally required improvements to the Premises, the n such improvements shall be at Tenant’s sole cost.
9.5 Prevailing Wages. In making any approved Improvements or alterations, Tenant shall comply with all applicable laws, including prevailing wage laws (California Labor Code Sections 1720 et seq.) and shall defend, indemnify and hold Landlord harmless from and against any and all claims by any third parties, including but not limited to, contractors and subcontractors for prevailing wages.
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 282 of 362
-12-
12183-0001\2640491v4.doc
ARTICLE 10
PARKING
Intentionally Left Blank.
ARTICLE 11
DAMAGE TO TENANT’S PROPERTY; WAIVER
Notwithstanding anything contained in this Lease to the contrary, Landlord or its agents and employees shall not be liable for (a) loss or damage to any property by theft or otherwise, or (b) any injury or damage to person or property resulting from fire, explosion, falling plaster, steam, gas, electricity, water or rain which may leak from any part of the Pr emises or from pipes, appliances or plumbing work therein or from the roof, street, sub- surface or from any other place or resulting from dampness or any other cause whatsoever, except to the extent (i) resulting from the gross negligence or willful misconduct of Landlord or its contractors, agents, servants or employees or breach of this Lease by Landlord and (ii) not covered by the insurance ma intained by Tenant (or which would not have been so covered if Tenant had maintained the insurance required to be maintained by Tenant pursuant to this Lease). Landlord or its agents shall not be liable for interference with light or other similar intangib le property interests. Tenant shall give prompt notice to Landlord in case of fir e or accidents in the Premises and of defects therein or in the fixtures or equipment located therein.
ARTICLE 12
INSURANCE
12.1 Tenant’s Insurance. Tenant, at its sole cost and expense, commencing on the date Tenant is given access to the Premises, and continuing during the Term, shall procure, pay for and thereafter keep in full force and effect the following types of insurance, in at least the amounts and in the forms specified below:
(a) Commercial General Liability (CGL) with limits no less than Two Million Dollars ($2,000,000.00) per occurrence basis including products and completed operations, property damage, bodily injury and personal & advertising injury with limits no less than Two Million Dollars ($2,000,000) per occurrence. Tenant shall maintain in force liability insurance, at all times during the term of this Lease and any renewal or extension thereof, which shall insure and indemnify Landlord, the City Council and each member th ereof, and every officer and employee of Landlord against liability or financial loss resulting from any suits, claims or actions brought by any person or persons and from all costs and expense of litigation brought against Landlord, the City Council and every member thereof for any injury to persons and/or damage to property in, on or about the Premises by reason of the use or occupation by Tenant or by any other person or persons of the Premises and the activities of Tenant. (b) A policy or policies of Workers Compensation insurance in the amount required by the State of California.
(c) Property Insurance against all risk of loss at full replacement cost with no coinsurance penalty provision at Tenant’s cost and expense, shall be obtained and at all times during the term hereof maintain in effect covering (1) all improvements included in the Premises;
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 283 of 362
-13-
12183-0001\2640491v4.doc
(ii) Tenant’s trade fixtures, furnishings, equipment, and inventory of merchandise located in the Premises; and (2) all alterations, additions, and changes made in or to the Premises during the term of this Lease at Tenant’s expense, providing protection to the extent of not less than one hundred percent (100%) of the insurable value of all said items against any peril included under insurance industry practices in t he jurisdiction of the Premises within the classification “fire and extended coverage,” together with insurance against vandalism, malicious mischief, and sprinkler leakage or other sprinkler damage, if sprinklers are installed, and including “use and occupancy” and/or “business interruption” coverage. Tenant hereby waives any and all rights of recovery against Landlord for any loss occurring to such items on account of fire or other casualty, and the aforesaid policies of insurance shall contain appropria te provision recognizing this release by Tenant and waiving all right of subrogation by the insurance carrier. The proceeds of such insurance, so long as this Lease remains in effect, shall be used to repair or replace the items so insured in the event of loss on account of fire or other casualty.
(d) Automobile Liability: Covering any auto, or if Tenant has no owned autos, hired, and non-owned autos, with limits no less than the amount required by law per accident for bodily injury and property damage.
(e) Plate Glass Insurance : Plate glass insurance covering all plate glass on the Premises at full replacement value; provided that Tenant shall be permitted to self -insure plate glass insurance.
(f) Insurance covering all of Tenant’s Improvements and Tenant’s Alterations, in an amount not less than their full replacement value from time to time, including replacement cost endorsement, providing protection against any peril included within the classification Fire and Extended Coverage, sprinkler damage, vandalism, malicious mischief and such other additional perils as covered in an “all risks” standard insurance policy. Any policy proceeds shall be used for the repair or replacement of the property damaged or destroyed unless this Lease shall cease and terminate under the provisions of Article 14.
(g) Business Interruption Insurance: Commercially reasonable business interruption insurance.
12.2 Restrictions on Use. Tenant shall not use or permit the Premises to be used, nor do or permit any act to be done, which may increase the existing rates of insurance upon the building in which the Premises are located, or which may cause the cancellation of any insurance poli cy covering the Premises. If any act on the part of Tenant or use of the Premises by Tenant shall cause directly or indirectly any increase of Landlord’s insurance expense, the additional expense shall be paid by Tenant to Landlord upon demand. Such paym ent by Tenant shall not limit Landlord in the exercise of any other rights or remedies. Tenant shall not sell or permit to be kept, used or sold in or about the Premises any article which may be prohibited by California Standard Forms of fire insurance policies. Tenant, at Tenant’s sole expense, shall comply with any and all requirements pertaining to the use of the Premises, of any insurance organization or company, which compliance may be necessary for maintenance of reasonable fire, extended coverage, public liability, and other insurance upon the Premises.
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 284 of 362
-14-
12183-0001\2640491v4.doc
12.3 Additional Insureds. Landlord shall be named as an additional insured on Tenant’s liability and property policies. Said policies shall be issued by an insurer rated in Best’s Insurance Guide with a financial rating of A+ VII or better. If commercially available, s aid policies shall provide that the insurance coverage shall not be cancelled or reduced by the insurance carrier without Landlord having been given thirty (30) days’ prior written notice thereof by such carrier.
Tenant shall not cancel or reduce said insurance coverage.
12.4 Certificate(s) of Insurance. At all times during the term of this Lease and prior to taking possession of the Premises, Tenant shall maintain on file with Landlord a cert ificate of insurance issued by the insurance carrier or carriers and showing that the aforesaid insurance policies are in effect in the amounts above provided and if requested by Landlord, a copy of each insurance policy. Notwithstanding any other provision to the contrary contained in this Lease, Tenant shall not have the right to take possession of the Premises until such certificate or certificates and insurance policies are filed with the City.
12.5 Landlord Cure Right. If Tenant does not keep the insurance required by this Lease in full force and effect, Landlord may obtain the necessary insurance and pay the premium thereon, and the repayment thereof shall be paid by Tenant as Additional Rent within ten (10) days after written demand by Landlord.
12.6 Waiver of Subrogation. Tenant’s insurance shall be primary to coverage available to Landlord. Tenant hereby waives any rights of subrogation against the Landlord.
12.7 Indemnity. “ Landlord” for the purposes of this Article 12 shall mean and include Landlord, and its councilmembers, officers, agents and employees. To the fullest extent permitted by law, Tenant covenants with Landlord that Landlord shall not be liable for any damage or liability of any kind or for any injury to or death of persons or damage to property of Tenant or any other person from any cause whatsoever related to the use, occupancy or enjoyment of the Premises by Tenant or any person thereon or holding under Tenant. Tenant shall pay for, defend (with an attorney reasonably approved by Landlord), indemnify, and save Landlord harmless against and from any real or alleged damage or injury and from all claims, judgments, liabilities, losses, costs and expenses, including reasonable attorneys’ fees and costs, arising out of or connected with Tenant’s u se of the Premises and its facilities, or any repairs, Alterations or improvements (including original improvements and fixtures specified as Tenant’s Initial Improvements) which Tenant may make or cause to be made upon the Premises, any breach of this Lea se by Tenant. The obligations to indemnify set forth in this Article shall include all reasonable attorneys’ fees, litigation costs, investigation costs and court costs and all other costs, expenses and liabilities incurred by the indemnified party from the first notice that any claim or demand is to be made or may be made. All obligations under this Article shall survive the expiration or termination of this Lease.
ARTICLE 13
DAMAGE
13.1 Insured Casualty. In the case of damage by fire or other perils covered by insurance, the following provisions shall apply:
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 285 of 362
-15-
12183-0001\2640491v4.doc
(a) Within a period of sixty (60) days after all applicable permits have been obtained (which permits Landlord shall promptly apply for and diligently seek) and delivery of insurance proceeds to Landlord, Landlord shall commence such repair, reconstruction and restoration of the Premises to the extent they have been affected by fire or other casualty, and shall diligently prosecute the same to completion; provided, however, that Tenant, at its cost, shall repair and restore all items of Tenant’s Initial Improvements and Tenant’s Alterations and replace its stock in trade, trade fixtures, furniture, furnishings and equipment. Tenant shall commence this work promptly upon delivery of possession of the Premises to Tenant and shall diligently prosecute same to completion.
(b) Notwithstanding the foregoing, if destruction of the Premises occurs the Term and the estimated time to repair the Premise is more than ninety (90) days, Landlord and Tenant shall each have the right to terminate this Lease. In each case of a termination under this Article, the termination right shall be exercised by the terminating party giving written notice to the other party within thirty (30) days af ter the date of destruction, provided that Tenant shall not have the right to terminate unless all insurance proceeds are delivered to Landlord. (c) If, prior to the commencement of any repair or restoration work, it is estimated (which estimate shall be deliv ered to both Landlord and Tenant in a written notice) by an independent and reputable contractor selected by Landlord that the damage to the Premises cannot reasonably be completed within 90 days after the date of damage and delivery of insurance proceeds, then each party shall have the right to terminate the Lease within thirty (30) days after receiving such written estimate provided that such party (and its agents, employees and contractors) did not cause the damage.
13.2 Uninsured Casualty. If the Premises or the Premises is materially damaged as a result of any casualty not covered by the insurance specified in Section 12.4 and not caused by Landlord, then Tenant shall, within ninety (90) days following the date of such damage, commence repair, reconstruction or restoration of the Premises and shall diligently prosecute the same to completion, or Landlord may elect within said ninety (90) days not to so repair, reconstruct or restore the damaged property, in which event, at Landlord’s option, this Lease shall cease and terminate upon the expiration of such ninety (90) day period. In the event Landlord elects to restore the Premises, Tenant shall have the same repair, restoration and replacement obligations as to its improvements and Alterations as it has pursuant to Section 13.1.
13.3 Abatement. The Base Rent and Additional Rent payable hereunder shall be abated (i) to the extent it is not payable by Tenant’s insurance (such as Business Interruption insurance); and then (ii) proportionately with the degree to whi ch Tenant’s use of the Premises is impaired from the time of the occurrence of the casualty until the date on which Tenant again operates its business in the Premise s provided however that neither Tenant nor its agents, employees or contractors caused the damage.
13.4 Waiver of Termination . Tenant waives any statutory rights of termination which may arise by reason of any partial or total destruction of the Premises.
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 286 of 362
-16-
12183-0001\2640491v4.doc
ARTICLE 14
EMINENT DOMAIN
14.1 Taking. The term “Taking”, as used in this Article 14 , shall mean an appropriation or taking under the power of eminent domain by any public or quasi -public authority or a voluntary sale or conveyance in lieu of condemnation but under threat of condemnation.
14.2 Total Taking. In the event of a Taking of the entire Premises , this Lease shall terminate and expire as of the date possession is delivered to the condemning authority and Landlord and Tenant shall each be released from any liability accruing pursuant to this Lease after the date of such termination.
14.3 Partial Taking. If there is a Taking of a material portion of the Premises and, regardless of the amount taken, the Premises is not, in Tenant’s sole but reasonable business judgment, suitable for the continued operation of Tenant’s business, then Tenant may terminate this Lea se, upon giving notice in writing of such election to Landlord within thirty (30) days after receipt by Tenant from Landlord of written notice that a portion of the Premises has been so appropriated or taken. In each case, the termination of this Lease shall be effective as of the date Tenant is required to vacate all or a portion of the Premises.
14.4 Award. The entire award or compensation in any such condemnation proceeding, whether for a total or partial Taking, or for diminution in the value of the leasehold or for the fee, shall belong to and be the property of Landlord. Without derogating the rights of Landlord under the preceding sentence, Tenant shall be entitled to recover from the condemning authority such compensation as may be separately awarded by the condemning authority to Tenant or recoverable from the condemning authority by Tenant in its own right and separately allocated to the taking of trade fixtures and equipment owned by Tenant, the expense of removing and relocating Tenant’s trade fixtures and equipment, interruption or damage to Tenants’ business, the value of Tenant’s leasehold estate, or the unamortized cost of Tenant improvements paid for by Tenant.
14.5 Continuation of Lease . In the event of a Taking, if Landlord and Tenant elect not to terminate this Lease as provided above (or have no right to so terminate), Landlord agrees, at Landlord’s cost and expense as soon as reasonably possible after the Taking, to restore the Premises necessary for Tenant to reasonably operate from the Premises (to the extent of the condemnation proceeds) on the land remaining to a complete unit of like quality and character as existed prior to the Taking and, thereafter, Base Rent and Additional Rent payable by Tenant hereunder shall be reduced on an equitable basis, taking into account the relative value of the portion taken as compared to the portion remaining, and Landlord shall be entitled to receive the total award or compensation in such proceedings.
ARTICLE 15
ASSIGNMENT AND SUBLETTING
15.1 Assignment. Tenant shall not assign, change ownership or voting control, mortgage, encumber, pledge, hypothecate or otherwise transfer (including any transfer by operation of law) all or any part of this Lease or the Premises (collectively “Transfer ”) without first procuring the written consent of Landlord in Landlord’s sole and absolute discretion. A sale of twenty -five
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 287 of 362
-17-
12183-0001\2640491v4.doc
percent (25%) or more of the ownership interests in Tenant, whether in one transaction or a related series of transactions, shall constitute an assignment of this Lease. If Tenant requests Landlord’s consent to an assignment of this Lease, Tenant shall submit to Landlord, in writing, the name of the proposed assignee.
15.2 Procedures. Should Tenant desire to enter into a Transfer, Tenant shall request, in writing, Landlord’s consent to the proposed Transfer at least forty -five (45) days before the intended effective date of the proposed Transfer, which request shall include any information reasonably requested by Landlord to evaluate the proposed Transfer. A consent to one (1) Transfer by Landlord shall not be deemed to be a consent to any subsequent Transfer to any other party.
15.3 Standard for Consent After Tenant Event of Default . For purposes of Landlord’s consent after an Event of Default by Tenant and Landlord’s elec tion to keep this Lease in effect, Tenant agrees that Landlord may only refuse its consent to the proposed transfer on reasonable grounds, and (by way of example and without limitation) Tenant agrees that it shall be reasonable for Landlord to withhold its consent if any of the following situations exist or may exist: (a) the proposed transferee’s financial condition, net worth or liquidity is less than the financial condition, net worth or liquidity of Tenant as of the date of the request for transfer or is inadequate to support all of the financial and other obligations of Tenant under this Lease; (b) the business reputation or character of the proposed transferee is not reasonably acceptable to Landlord; or (c) the proposed transferee is not likely to conduct on the Premises a business of a quality commensurate with the neighborhood.
15.4 No Release; Form. No Transfer whether with or without Landlord’s consent, shall relieve Tenant from its covenants and obligations under this Lease. Any Transfer shall be evi denced by an instrument in form and content satisfactory to Landlord and executed by Tenant and the Transferee.
15.5 Sublease. Tenant shall not sublease all or any part of this Lease or the Premises without first procuring in advance the written consent of Landlord in Landlord’s sole and absolute discretion. No sublease whether with or without Landlord’s consent, shall relieve Tenant from its covenants and obligations under this Lease. Any sublease shall be evidenced by an instrument signed by the Tenant and sublessee. If Tenant requests Landlord’s consent to subletting of all or part of the Premises, Tenant shall submit to Landlord, in writing, the name of the proposed subtenant. If for any reason this Lease is terminated, the Parties agree the termination will result in a termination of any sublease within the Premises authorized by Landlord and Tenant shall include such a provision in any agreement with a sublessee.
ARTICLE 16
DEFAULTS
16.1 Events of Default . The occurrence of any one or more of the following events shall constitute an “Event of Default” by Tenant under this Lease:
(i) failure to pay the Base Rent, [Percentage Rent], any Additional Rent, or the Security Deposit when due and failure to cure such default within five (5) days after written notice from Landlord to Tenant;
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 288 of 362
-18-
12183-0001\2640491v4.doc
(ii) failure to perform any other of the promises, covenants or agreements of Tenant contained in this Lease for more than thirty (30) days after written notice from Landlord (provided, however, if the default cannot be rectified or cured within suc h thirty (30) day period, the default shall be deemed to be rectified or cured if Tenant, within such thirty (30) day period, shall have commenced to rectify or cure the default and shall thereafter diligently and continuously prosecute same to completion);
(iii) an assignment or subletting by Tenant without Landlord’s prior written consent when such consent is required by this Lease; or (iv) failure to maintain the insurance required of Tenant under this Lease.
16.2 Landlord Remedies. Any notice required to be given by Landlord above shall be in lieu of, and not in addition to, any notice required under Section 1161 of the Code of Civil Procedure of California or any similar, superseding statute. Upon the occurrence of an Event of D efault by Tenant, Landlord may elect to terminate this Lease and to re -enter and take possession of the Premises and remove all persons therefrom, and/or exercise all or any of the rights and remedies afforded Landlord by California law including, but not limited to, the remedies provided under California Civil Code Sections 1951.2 or 1951.4. Pursuant to California Civil Code Section 1951.2, the damages Landlord may recover against Tenant include, but are not limited to, the worth at the time of award of t he amount by which the unpaid rent for the balance of the term after the time of award, exceeds the amount of such rental loss for the same period that the Tenant proves could be reasonably avoided. Pursuant to California Civil Code Section 1951.4, Landlord may continue this Lease in effect after Tenant’s breach of this Lease and abandonment of the Premises and recover rent as it becomes due, if Tenant has the right to sublet the Premises or assign this Lease, subject only to reasonable limitations. Landl ord hereby agrees that in the event Landlord elects the remedy under California Civil Code Section 1951.4, Landlord will not unreasonably withhold its consent to assignment and subletting by Tenant, and Article 15.3 shall apply.
16.3 Default by Landlord. Landlord shall not be in default hereunder unless Landlord fails to perform the obligations required of Landlord within thirty (30) days after written notice by Tenant to Landlord specifying wherein Landlord has failed to perform such obligation; provided, however, that if the nature of Landlord’s obligation is such that more than thirty (30) days are required for performance, then Landlord shall not be in default if Landlord commences performance within such thirty (30) day period and thereafter diligently pros ecutes the same to completion. Notwithstanding any contrary provision contained in this Lease, Landlord shall not be liable under any circumstances for any indirect or consequential damages or any injury or damage to, or interference with, Tenant’s busine ss, including, but not limited to, loss of profits, loss of rents or other revenues, loss of business opportunity, loss of goodwill or loss of use; provided, that the foregoing is not intended to be a waiver by Tenant of any rights it may have to condemnation awards in the event of a condemnation by Landlord of Tenant’s interest under this Lease or Tenant’s business.
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 289 of 362
-19-
12183-0001\2640491v4.doc
ARTICLE 17
SUBORDINATION, ATTORNMENT AND ESTOPPEL CERTIFICATES
17.1 Subordination. So long as the lienholder agrees in writing to be bound by the obligations of the Landlord arising after the lienholder acquires title to the Premises, and provided such lienholder also executes a commercially reasonable non -disturbance agreement in favor of the Tenant, then upon written request of Landlord, Landlord’s mortgagee, or the beneficiary of a deed of trust of Landlord or a lessor of Landlord, Tenant will subordinate its rights pursuant to this Lease in writing to the lien of any mortgage, deed of trust or the interest of any lease in which Landlord is the lessee and to all advances made or hereafter to be made upon the security thereof.
17.2 Attornment. In the event any proceedings are brought for foreclosure, or in the event of the exercise of the power of sale under any mortgage or deed of trust made by Landlord encumbering the Premises, or should a lease in which Landlord is the lessee be terminated, Tenant shall upon the request of the purchaser or lessor attorn to the purchaser or lessor under such lease upon any foreclosure, sale or lease termination and recognize the purchaser or lessor as Landlord under this Lease, provided that the purchaser or lessor shall acquire and accept the Premises subject to this Lease.
17.3 Estoppel Certificates. Upon not less than ten (10) days prior notice from Landlord or Tenant to the other, Landlord or Tenant, as the case maybe shall execute, acknowledge and deliver to the requesting party, a reasonable estoppel certificate certifying that this Lease is unmodified and in full force and effect and that the other party is not in default (or stating how any of the foregoing is not true) and certifying the dates to which rental or other sums due hereunder have been paid in advance (“Estoppel Certificate”).
17.4 Subordination of Landlord’s Liens . Landlord hereby subordinates all statutory and contractual landlord’s liens to any liens or security interests covering Tenant’s inventory, or financed fixtures, furniture or equipment of Tenant in favor of bona -fide third -party lenders providing financing to Tenant (including purchase -money financing). Additionally, Tenant shall be permitted to remove personal property from the Premises without Landlord’s consent (free and clear of any landlord’s liens) whenever Tenant has not previously received from Landlord a written notice of default which remains uncured.
ARTICLE 18
MATTERS OF RECORD
Tenant agrees that it and all persons in possession or holding under it will conform to and will not violate the terms of any covenants, conditions, restrictions, easements and any other matters currently of record. Tenant acknowledges that Tenant has had an opportunity to obtain and review a title report and title exception documents from a title insurance company selected by Tenant.
ARTICLE 19
UTILITIES AND SERVICES
Tenant shall pay directly to the appropriate utility company all charges for utility services supplied to Tenant. If no such (sub)meter exists, then Tenant shall reimburse Landlord within ten
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 290 of 362
-20-
12183-0001\2640491v4.doc
(10) days after written demand from time to time for Tenant’s share utility charges allocable to the Premises. In that regard, Tenant is responsible for directly contracting utility services including, but not limited to those shown in the table below.
Service Responsible Party for Directly Contracting
Electric Utility Tenant
Water/Sewer Utility Tenant
Gas Utility Tenant
Trash Pickup Services Tenant
Fire and Life Safety Monitoring Tenant
In addition, Tenant, at Tenant’s expense, will cause the Premises to be treated for termites, rodents, and other pests and vermin as often as Landlord considers reasonably necessary.
Regardless of the entity which supplies any of the utility services, Landlord shall not be liable for any failure or interruption of any utility or service. Except as otherwise provided herein, no failure or interruption of any utility or service shall entitle Tenant to terminate this Lease or discontinue making payments of Rent payable by Tenant under this Lease; provided, however, that Landlord shall use good faith efforts to restore such service to the extent the restoration of the same is not the obligation of Tenant, the utility company or other third party.
ARTICLE 20
MISCELLANEOUS
20.1 Hazardous Materials. During the Term of this Lease, Tenant, at its sole cost and expense, shall comply with all laws relating to the storage, use, handling and disposal of hazardous, toxic or radioactive matter, including, without limitation, petroleum products, asbestos, and those materials identified in Sections 66680 and 66685 of Title 22 of the California Administrative Code, Division 4, Chapter 30 (“ Title 22 ”), as am ended from time to time (collectively, “ Hazardous Materials”); provided, however, that the foregoing shall not apply to Hazardous Materials in, on or surrounding the Pr emises not released by Tenant or its contractors, employees, agents or customers. Tenant shall notify Landlord and provide to Landlord a copy or copies of any environmental entitlements or inquiries related to the Premises. The clean-up and disposal of any Hazardous Materials released onto or about the Pr emises by Tenant or its agents, contr actors or employees shall be performed by Tenant at Tenant’s sole cost and expense and shall be performed in accordance with all applicable laws, rules, regulations and ordinances, pursuant to a site assessment and removal/remediation plan prepared by a licensed and qualified geotechnical engineer and submitted to and approved in writing by Landlord prior to the commencement of any work. The foregoing notwithstanding, Landlord in Landlord’s sole and absolute discretion may elect, by written notice to Tenant, to perform the clean -up and disposal of such Hazardous Materials from the Premises. In such event, Tenant shall pay to Landlord the actual cost of same upon receipt from Landlord of Landlord’s written invoice therefor. Notwithstanding any other term or provision of this Lease, Tenant shall permit Landlord or Landlord’s agents or employees to enter the Premises at any time, upon at least one (1) business day’s notice, to inspect, monitor and/or take emergency or long -term remedial action with respect to Hazardous Materials on or
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 291 of 362
-21-
12183-0001\2640491v4.doc
affecting the Premises or to discharge Tenant’s obligations hereunder with respect to such Hazardous Materials when Tenant has failed, after demand by Landlord, to do so. All costs and expenses incurred by Landlord in connection with performing Tenant’s obligations hereunder shall be reimbursed by Tenant to Landlord within thirty (30) days of Tenant’s receipt of written request therefor.
Tenant shall defend, indemnify, and hold Landlord harmless from and against any and all claims, liabilities, losses, costs, and expenses (including, without limitation reasonable attorneys’ fees) incurred or suffered by Landlord as a result of Tenant’s or its invitees’, licensees’, contractors’, agents’ or employees’ storage, use, handling, disposa l or release of Hazardous Materials in or about the Premises or the Premises.
20.2 Notices. Every notice, demand or request (collectively “Notice”) required hereunder or by law to be given by either party to the other shall be in writing. Notices shall be giv en by United States certified mail, postage prepaid, return receipt requested, or by same-day or overnight private courier, addressed to the party to be served at the address indicated in Section 1.11 or such other address as the party to be served may fro m time to time designate in a Notice to the other party.
The delivery of a Notice shall be deemed made within 3 days after deposit into the U.S. mail with respect to certified mail or within 1 business day after deposit with an overnight private courier for overnight delivery. Copies of any Notice shall be sent to the addresses, if any, designated for service of copies of Notices in Section 1.11.
20.3 Force Majeure. Any prevention, delay or stoppage due to strikes, lockouts, labor disputes, acts of God, inability to obtain labor or materials or reasonable substitutes therefor, governmental restrictions, governmental regulations, governmental controls, judicial orders, enemy or hostile governmental action, civil commotion, fire or other casualty, and other causes (except financial) beyond the reasonable control of the party obligated to perform, shall excuse the performance by that party for a period equal to the prevention, delay or stoppage; however, this Section shall not be applied to delay the payment by Tenant of payments required of Tenant under this Lease.
20.4 Surrender; Waiver. At the expiration or any earlier termination of the Term, Tenant shall peaceably and quietly surrender to Landlord the possession of the Premises and all improvements and fixtures installed or constructed by or for Tenant thereon free and clear of all claims to or against them by Tenant or any third person or party. Tenant shall leave the surrendered property in good, safe and broom -clean condition. All property that Tena nt is required to surrender shall become Landlord’s property at termination of this Lease, or, if Landlord so elects and upon written notice to Tenant, shall be demolished and removed by Tenant at Tenant’s sole expense, and all property that Tenant is not required to surrender but that Tenant does not remove shall become Landlord’s property at termination of this Lease, or, if Landlord so elects and upon written notice to Tenant, shall be demolished and removed by Tenant at Tenant’s sole expense. If Tenant fails to surrender the Property at the expiration or earlier termination of this Lease, Tenant shall defend and indemnify Landlord from all liability and expense resulting from the delay or failure to surrender, including claims made by any succeeding tenant or any purchaser or prospective purchaser founded on or resulting from Tenant’s failure to surrender.
Tenant hereby waives all statutes and laws that conflict with the terms of this Section.
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 292 of 362
-22-
12183-0001\2640491v4.doc
20.5 Holding Over. Should Tenant hold over in the Premises beyond the expiration or earlier termination of this Lease, the holding over shall not constitute a renewal or extension of this Lease or give Tenant any rights under this Lease. In such event, Landlord may, in its sole discretion, treat Tenant as a tenant at will, subject to all of the terms and conditions in this Lease except that the Base Rent shall be increased to one hundred fifty percent (150%) of the Base Rent previously in effect.
20.6 Successors and Assigns . Subject to the terms of this Lease restricting as signment and subletting, all rights and obligations of Landlord and Tenant under this Lease shall extend to and bind the respective heirs, executors, administrators and the permitted concessionaires, successors, subtenants and assignees of the parties.
20.7 Waiver of Lease Terms. Any waiver by either party of a breach by the other party of a covenant of this Lease must be in writing, and shall not be construed as a waiver of a subsequent breach of the same covenant.
20.8 Interest on Past Due Sums. Except where another rate of interest is specifically provided for in this Lease, any amount due from either party to the other under this Lease which is not paid when due, shall bear interest at the rate per annum (“Interest Rate”) equal to the prime interest rate published from time to time by the Wall Street Journal plus two (2) percentage points (but in no event to exceed the maximum lawful rate) from the date such amount was originally due to and including the date of payment.
20.9 Authority. If Tenant or Landlord is a municipal corporation, corporation, partnership or limited liability company, each individual executing this Lease on behalf of the municipal corporation, corporation, partnership or limited liability company (in his/her representative capacity only) represents and warrants that he or she is duly authorized to execute and deliver this Lease on behalf of the municipal corporation, corporation, partnership or limited liability company and that this Lease is binding upon the municipal corporation, corporation, part nership or limited liability company.
20.10 Governing Law. This Lease shall be governed by and construed in accordance with the laws of the State of California without giving effect to the choice of law provisions thereof.
20.11 Waiver of Rights of Redemption. Tenant waives any and all rights of redemption granted under any present and future laws in the event Landlord obtains the right to possession of the Premises by reason of the violation by Tenant of any of the covenants and conditions of this Lease or otherwise.
20.12 Attorneys’ Fees. In the event that, at any time after the Effective Date of this Lease, either Landlord or Tenant shall institute any action or proceeding against the other relating to the provisions of this Lease or any default hereunder, the party not prevailing in such action or proceeding shall reimburse the prevailing party for its actual attorneys’ fees, and all fees, costs and expenses incurred in connection with such action or proceeding, including, without limitation, any post-judgment fees, costs or expenses incurred on any appeal or in collection of any judgment.
20.13 Rules and Regulations. Tenant shall observe faithfully and comply with, and shall cause its employees and invitees to observe faithfully and comply with, reasonable and
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 293 of 362
-23-
12183-0001\2640491v4.doc
nondiscriminatory rules and regulations governing the Premises as may from time to time be promulgated by Landlord.
20.14 Landlord Liability Upon Transfer. Should Landlord sell, exchange or assign this Lease (other than a conditional assignment as security for a loan), then Landlord, as transferor, shall be relieved of any and all obligations on the part of Landlord accruing under this Lease from and after the date of such transfer provided that Landlord’s successor in interest shall assume such obligations from and after such date. Written notice of any such transfer shall be given to Tenant.
20.15 Limitation of Landlord Liability. Notwithstanding anything contained in this Lease to the contrary, it is expressly understood and agreed that any judgment against Landlord resulting from any default or other claim under this Lease shall be satisfied only out of the net rents, issues, profits and other income actually received from the operation or sale of the Premises , and Tenant shall have no claim against Landlord or any of Landlord’s personal assets for satisfaction of any judgment with respect to this Lease.
20.16 Mechanics Liens. Tenant shall pay all costs for work performed by or on account of it and shall keep the Premises free and clear of mechanics’ liens or any other liens or stop notices. Tenant shall give Landlord immediate notice of any lien or stop notice filed against the Premises as a result of any work of improvement performed by or on behalf of Tenant. Tenant shall immediately cause any lien or stop notice to be discharged o r removed of record by either paying the amount thereof or recording a statutory lien release bond in an amount equal to one hundred fifty percent (150%) of the amount of said lien or stop notice, or such other amount as may be adequate to cause the lien or stop notice to be released as an encumbrance against the Premises.
20.17 Brokers. Except for any brokers named in Section 1.13, Landlord and Tenant each represents and warrants that it has not had any dealings with any realtors, brokers or agents in connection with the negotiation of this Lease . Tenant shall defend, indemnify and hold the other harmless from any claims, costs, expenses or liabilities for any compensation, commission or charges to other realtors, brokers or agents claiming by, through or on beha lf of Landlord or Tenant, as the case may be, with respect to this Lease and/or the negotiation hereof.
20.18 Landlord’s Governmental Capacity. Notwithstanding anything contained in this Lease to the contrary, Tenant acknowledges that Landlord is acting in its proprietary capacity, is entering into and complying with this Lease, and that nothing contained in this Lease shall require Landlord, in its capacity as a governmental entity, to act in any predetermined manner in connection with its actions as a governmental entity, as opposed to its actions as a contracting party pursuant to this Lease.
20.19 Quiet Enjoyment. Provided a default by Tenant does not occur, Tenant shall have the right of quiet enjoyment of the Premises free from interference by Landlord or by any p erson or entity claiming rights granted by Landlord.
20.20 Right of First Refusal. In the event Landlord proposes to sell the Premises during the Term of the Lease, Tenant is given a first right-of-refusal for the purchase of Premises for the then
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 294 of 362
-24-
12183-0001\2640491v4.doc
appraised fair market v alue, as determined by a MAI appraiser. Such right must be exercised within thirty (30) days after notification by the City.
20.21 Severability. If any provision of this Lease is held or adjudicated to be invalid or unenforceable for any reason, each such portion or provision shall be severed from the remaining portions or provisions of this Lease and the remaining portions or provisions shall be unaffected and remain in full force and effect.
20.22 Memorandum of Lease. Concurrently with the execution and delivery of this Lease, Tenant shall also execute, acknowledge and deliver to Landlord a Memorandum of Lease in the form attached hereto as Exhibit “C”
for recording. Tenant shall not record this Lease, any notice of other memorandum of this Lease. Upon the expiration or any earlier termination of this Lease, Tenant shall execute, acknowledge and deliver to Landlord a termination of such recorded Memorandum of Lease and/or quitclaim deed in the form prepared by Landlord and submitted to Tenant.
20.23 Entire Agreement ; Amendments . It is understood that there are no oral or written agreements or representations between the parties hereto affecting this Lease and this Lease supersedes and cancels any and all previous negotiations, arran gements, representations, brochures, agreements and understandings, if any, between Landlord and Tenant. No provision of this Lease may be amended except by an agreement in writi ng signed by Landlord and Tenant.
All exhibits referenced in this Lease are incorporated herein by this reference.
20.24 No Relocation Assistance; Waiver and Release. Tenant acknowledges that Tenant shall be displaced from the Premises upon the expiration or any earlier termination of this Lease, but Tenant hereby agrees that Landlord shall have no obligation to Tenant under the California Relocation Assistance and Real Premises Acquisition statutes and guidelines. Tenant, after diligent review and consideration of possible impacts, hereby waives and forever releases Landlord, including its successors, officers, employees, attorneys, agents, representatives and anyone else acting on Landlord’s behalf, of and from any and all claims, demands, actions or causes of action, obligations, liabilities, or claims for further compensation, known or unknown, based upon or relating to the California Relocation Assistance and Real Premises Acquisition statutes and guidelines and Landlord’s subsequent use and development of the Premises, or Tenant’s displacement therefrom. By such release, Tenant expressly waives its rights, if any, under California Civil Code Section 1542 which provides:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR
DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME
OF EXECUTING THE RELEASE WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.” Tenant’s Initials: _____
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 295 of 362
-25-
12183-0001\2640491v4.doc
IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Lease on the day and year first above written.
LANDLORD:
CITY OF INDIO
By:________________________________
Bryan H. Montgomery, City Manager
ATTEST:
Cynthia Hernandez, City Clerk
APPROVED AS TO FORM:
_____________________________________
Roxanne Diaz, City Attorney
TENANT:
BEER BUDS INC.
By: _____________________________
Print Name: ________________________
Title: _____________________________
By: _____________________________
Print Name: ________________________
Title: _____________________________
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 296 of 362
Exhibit “A”
12183-0001\2640491v4.doc
EXHIBIT “A”
LEGAL DESCRIPTION AND/OR DIAGRAM OF PREMISES
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 297 of 362
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 298 of 362
Exhibit “B”
12183-0001\2640491v4.doc
EXHIBIT “B”
TENANT’S INITIAL IMPROVEMENTS
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 299 of 362 Exhibit B
Tenant Improvements
15-Barrel Brewing System, Tanks and
Vital Brewhouse Parts
$125,000
Kitchen TI/ Buildout ( including Grease
Interceptor)
$75,000
Restaurant TI/ Buildout (including
Outdoor Patio/Area)
$75,000
Restaurant Décor $30,000
Kitchen Equipment $25,000
Misc. Brewery Systems + Parts $20,000
Walk-In Fridges $15,000
Commercial Roll-Up Garage Door $5,000
Total: $370,000
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 300 of 362
Exhibit “C”
12183-0001\2640491v4.doc
EXHIBIT “C”
FORM OF MEMORANDUM OF LEASE
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 301 of 362
Exhibit “C”
12183-0001\2640491v4.doc
RECORDING REQUESTED BY,
AND WHEN RECORDED MAIL TO:
City of Indio
100 Civic Center Mall
Indio, CA 92201
Attn: City Clerk
SPACE ABOVE THIS LINE FOR RECORDER'S USE
The undersigned declare that this Memorandum of Lease is exempt from Recording Fees pursuant to California Government Code Section 27383 and exempt from Documentary Transfer Tax pursuant to California Revenue and Taxation Code Section 11922.
MEMORANDUM OF LEASE
THIS MEMORANDUM OF LEASE (this “Memorandum”) is dated as of July 1, 2022, and is entered into by and between BEER BUDS INC. (“Tenant”), and the CITY OF INDIO (“Landlord”).
RECITALS
A. Tenant and Landlord have entered into that certain Building Lease dated July 1, 2022 (the “Lease”), pursuant to which Landlord has agreed to lease and demise to Tenant, and Tenant has agreed to lease and accept from Landlord that certain building and premises located in the City of Indio commonly known as 82921 Indio Boulevard (the “Premises”) . The Premises are more particularly described in the Lease.
B. Landlord and Tenant now desire to enter into this Memorandum to comply with applicable law requiring that municipal leases be recorded.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Tenant and City agree as follows:
1. Lease. Landlord hereby leases and demises the Premises to Tenant, and Tenant hereby leases and accepts the Premises from Landlord, for a term commencing on __________ and expiring on July 1, 2022, at the rental rates and upon the other terms and conditions set forth in the Lease, which are incorporated herein by this reference.
2. P
urpose. This Memorandum is prepared for the purposes of recordation only and in no way modifies the terms and conditions of the Lease. In the event any provision of this Memorandum is inconsistent with any term or condition of the Lease, the term or condition of the Lease shall prevail.
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 302 of 362
Exhibit “C”
12183-0001\2640491v4.doc
3. Counterparts. This Memorandum may be executed in any number of counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, taken together, shall be deemed to be one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Memorandum of Lease as of the date first written above.
LANDLORD: TENANT:
CITY OF INDIO
By:
Bryan H. Montgomery
City Manager
BEER BUDS INC.
By: _____________________________
Print Name: _____________________
Title: ___________________________
By: _____________________________
Print Name: ______________________
Title: ___________________________
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 303 of 362
Exhibit “C”
12183-0001\2640491v4.doc
State of California )
County of _________________ )
On _________________________, before me, ,
(insert name and title of the officer)
Notary Public, personally appeared ,
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature (Seal)
A notary public or other officer
completing this certificate verifies only
the identity of the individual who signed
the document to which this certificate is
attached, and not the truthfulness,
accuracy, or validity of that document.
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 304 of 362
Exhibit “C”
12183-0001\2640491v4.doc
State of California )
County of ______________ )
On _________________________, before me, ,
(insert name and title of the officer)
Notary Public, personally appeared ,
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature (Seal)
A notary public or other officer
completing this certificate verifies only
the identity of the individual who signed
the document to which this certificate is
attached, and not the truthfulness,
accuracy, or validity of that document.
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 305 of 362
12183-0001\2640491v4.doc
[EXHIBIT “D”
NOTICE OF LEASE TERM COMMENCEMENT/RENT COMMENCEMENT DATES] To:
Beer Buds Inc.
Devon Sanchez
77770 Country Club Drive, Suite D
Palm Desert, California 92211
Re: Building Lease dated __________, 2022 between the City of Indio (“Landlord”), and Beer Buds Inc. (“Tenant”) for Premises located at 82921 Indio Boulevard, Indio, California.
Ladies and Gentlemen:
In accordance with the above-referenced Building Lease (the “Lease”), we wish to advise you and/or confirm as follows:
1. Landlord delivered possession of the Premises on _______.
2. The Term Commencement Date is _______.
3. The Rent Commencement Date is _______.
4. The Initial Term shall end on _______.
5. Your rent checks should be made payable to City of Indio at 100 Civic Center Mall, Indio, CA 92201, Attn: Finance Department.
Landlord:
CITY OF INDIO
______________________________
Bryan H. Montgomery, City Manager
Agreed and Accepted as of
____________, 2022
Tenant: ___________________
By:_______________________
Print Name:_________________
Title:______________________
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 306 of 362 ’1lF
GREATER
V ALLEYAMBER
CDACHELLA
May11,2022
CarlMorganCityoflndio100CivicCtrDr,lndio,CA92201Re:ProposedOfficeRelocationDearCarlAtthepromptingoftheCityoflndio,theGreaterCoachellaValleyChamberofCommerceprovidesthislettertoaffirmourwillingnesstorelocateourofficesincollaborationwiththeCityoflndio.TheCityoflndiohasbeenpresentedwithanopportunitytoofferourcurrentleasespace:82921lndioBlvd,lndio,CA92201toanewtenantwhoisbettersuitedforthisprimelocation.TheGreaterCoachellaValleyChamberofCommerceisfundamentallycommittedtoadvancingbusinessexpansionandeconomicdevelopmentintheCityoflndio(particularlyinDowntown!)andwe’rewillingtocontributetothatbyrelocating,aslongasourinterestsareprotectedthroughtheprocessandaslongasallcostsassociatedwiththerelocationplansarecoveredbytheCityoflndio(orreimbursedaccordingly)Atthistime,theCityoflndioandtheGreaterCoachellaValleyChamberofCommerceareengagedinmutualdiscussionandcollaborationtofacilitateourrelocation.TheChambershallberelocatedtooccupytwosuitesoffofOasis,bothofwhichareownedbytheCityoflndio.Ourintentistomovefon/vardwiththerelocationaslongastheCity’stwo-partrelocationplanoverthenextfewyearscanbehonoredwithnoexpensetothechamberforanyandallexpensesincurredasaresultoftherelocation.Additionally,theCityoflndioagreestosupporttheupgradingandupdatingofthenewofficesuitestheChamberwillberelocatedto.Thisletterisintendedasagoodwillconfirmationofourwillingnesstocontinuetheprocessofplanningandfacilitatingourrelocation.Thisletterdoesnotunderminethecurrentleaseagreementineffect.Ourwillingnesstorelocateiscontingentuponourmutualabilitytoagreeonthebasicpremisethatallexpensesassociatedwiththiscurrentrelocationandthesecondrelocationwillbe theCityentirely EmilynoPresident/CEOlndioChamberofCommerceDiscoverlndioVisitor’sCenterGreaterCoachellaValleyChamberofCommerce
AGENDA ITEM #9.12
Approval of a Building Lease Agreement with Beer Buds, Inc. for the prop... Page 307 of 362 City of Indio
City Council
May 18, 2022
STAFF REPORT
To: City Council
From: Bryan H. Montgomery, City Manager
Prepared by: Rob Rockwell, Asst. City Manager & Dir. Of Finance Subject: Community Facility Districts Special Tax Levy
RECOMMENDATION:
Adopt resolution No. 10278 authorizing the levy of a special tax for City of Indio Community Facilities District No. 2004-1 (Law Enforcement, Fire and Paramedic Services) and annexation areas thereto; the City of Indio Community Facilities District No. 2004 -2 (Law Enforcement, Fire and Paramedic Services); Resolution No. 10279 Community Facilities District No. 2004 -3 (Terra Lago Area No. 1); Resolution No. 10280 Community Facilities District No. 2005-1 (Talavera Area No. 1 and No. 2); and Resolution No. 10281 Community Facilities District No. 2006-1 (Sonora Wells) for fiscal year 2022/23.
SUMMARY:
Presented for City Council’s consideration are four resolutions that allow the City to proceed with the annual levy of special taxes for the fiscal year commencing July 1, 2022. This approval is routinely sought on an annual basis and ensures that the City continues to receive revenue for law enforcement and paramedic services, and pay debt service payments for infrastructure.
BACKGROUND INFORMATION:
Since the early 1980s, many California cities have managed growth, in part, based upon funding through community facilities districts (CFDs) formed per the “Mello-Roos Community Facilities Act of 1982,” Chapter 2.5, Part 1, Division 2, Title 5 of the Government Code of the State of California.
Through a CFD, either independently or working with a developer, a City passes either service or public infrastructure cost on to homebuyers via special taxes payable over an extended term. CFD costs can include construction, maintenance of the streets, sewer systems, police protection, ambulance service, schools, parks, libraries, museums, and other cultural-facility operations.
In 2004, the Indio City Council formed CFD 2004 -1 and CFD 2004 -2 to partially finance the City’s delivery of law enforcement, fire and paramedic services throughout included communities. At that time, and from time to time thereafter, the City Council approves annexations of numerous areas into CFD 2004 -permitted development residential any mitigation measures and Typically, 1. for constructed after 2004 include annexation into CFD 2004-1. Currently there are 10,553 active parcels that have been annexed into the CFDs and 8,432 are levied. In accordance with the Resolution of Formation, determining the validity of proceedings for Community Facility District No. 2004 -1 and 2004-2, the annual special assessment is to increase two percent (2%) each year.
Upon approval, the per parcel annual special assessment for CFDs 2004-1 and 2004-2, for FY 2022- 23, will be $514.16, an increase of two percent or $10.08 from the prior year. The CFDs are expected AGENDA ITEM #10.1
Adopt Resolution No. 10278 authorizing the levy of a special tax for Cit... Page 308 of 362 to generate $4.39 million citywide next fiscal year, offsetting the estimated annual $53.05 million cost of providing local public safety services. This is consistent with the Resolution of Formation, which decrees an increase of two percent each year. As reflected in the following chart, the assessment has increased two percent each year since inception of the districts.
The City Council also formed CFD 2004 -3 (Terra Lago, 761 active parcels in Area No. 1) and CFD 2005-1 (Talavera Area No.1 an d 2, combined 884 active parcels), and CFD 2006 -1 (Sonora Wells, 383 active parcels) as Mello -Roos CFDs. These CFDs finance, in whole or in part, the costs of infrastructure improvements that serve the respective communities. The revenue collected is used to make bond debt-service payments, inclusive of bond administrative and arbitrage (IRS) fees for these districts. The special taxes collected from homeowners are based on square-footage calculations for each specific home within each district. Homebuye rs have the option to pay off their specific total special tax assessment obligation up front or pay the obligation as part of their annual property taxes over a thirty-year period.
The amount of assessment revenue received and used for bond debt -service costs during FY 2022- 23 from Mello-Roos CFDs 2004-3 (Terra Lago Area No. 1), 2005 -1 (Talavera Area No. 1 and No. 2) and 2006-1 (Sonora Wells) are as follows:
The difference between revenue levied during the fiscal year and the amount of debt service paid during the same fiscal year is due to the timing of bond payments, where taxes collected during one fiscal year are used to pay debt-service payments in March of the same fiscal year and in September of the following fiscal year. In addition, as authorized by the Mello -Roos Act and the formation documents for these CFDs, each annual special tax levy includes a small amount to cover administrative expenses of the applicable CFD.
ATTACHMENTS:
CFD2004-1_ 2004-2-Resolution 10278 Attachment A
CFD2004-3_IA-1-Resolution 10279 Attachment B
CFD2005-1_IA-12-Resolution10280 Attachment C
AGENDA ITEM #10.1
Adopt Resolution No. 10278 authorizing the levy of a special tax for Cit... Page 309 of 362 CFD2006-1-Resolution 10281 Attachment D
APPROVAL(S):
Rob Rockwell, Asst. City Manager & Dir. Of Finance Approved - 09 May 2022 Roxanne Diaz, City Attorney Approved - 12 May 2022
Bryan H. Montgomery, City Manager Approved - 12 May 2022
AGENDA ITEM #10.1
Adopt Resolution No. 10278 authorizing the levy of a special tax for Cit... Page 310 of 362 Attachment A
RESOLUTION NO. 10278
RESOLUTION OF THE CI TY COUNCIL OF THE CI TY OF INDIO , ACTING IN ITS
CAPACITY AS THE LEGISLATIVE B ODY OF , AND AUTHORIZING THE
ESTABLISHMENT OF AN ANNUAL SPECIAL TAX F OR, CITY OF INDIO COMMU NITY FACILITIES DISTRICT NO. 2004 -1 (LAW ENFO RCEMENT, FIRE AND PARAM EDIC
SERVICES) AND ANNEXA TION AREAS THERETO, AND FOR CITY OF INDI O COMMUNITY FACILITIES DISTRICT NO. 2004 -2 (LAW ENFORCEMENT, F IRE AND PARAMEDIC SERVICES), FOR FISCAL YEAR 2022/2023
WHEREAS, the City Council (the “Council”) of the City of Indio (the “City”) had previously initiated proceedings, held a public hearing, conducted an election and received a favorable vote from the qualified electors to authorize the levy of special taxes in City of Indio Community Facilities District No. 200 4-1 (Law Enforcement, Fire and Paramedic Services) (the “CFD 2004-1”), Annexation Area Nos. 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 14, 15, 16, 17, 18, 19, 21, 23, 27, 28, 29, 30, 31, 37, 38, 39, 40, 41, 42, 43, 44, 45, 46, 47, 48, 49, 52, 53, 54, 55, 56, 57, 5 8, 59, 60, 61, 62, 63, 64, 65, 67 , 70, 71, 72, 73, 74, 75, 76, 77, 78, 79, 80, 81 and 82 of the CFD 2004-1 (collectively, the “Annexation Areas”), and City of Indio Community Facilities District No. 2004 -2 (Law Enforcement, Fire and Paramedic Services) (th e “CFD 2004 -2”), all as authorized pursuant to the terms and provisions of the “Mello -Roos Community Facilities Act of 1982,” being Chapter
2.5, Part 1, Division 2, Title 5 of the Government Code of the State of California (the “Act”); and WHEREAS, this Co uncil, by the adoption of applicable ordinances (the “Ordinances”) , as authorized by Section 53340 of the Government Code of the State of California, has authorized the levy of such special taxes in the CFD 2004-1, the Annexation Areas, and the CFD 2004-2; and WHEREAS, Government Code Section 53340 provides that this Council may provide, by resolution, for the levy of the special taxes in the CFD 2004 -1, the Annexation Areas, and the CFD 2004 -2 in the current tax year at the same rates or at a lower rate th an the rate provided for in the Ordinances if such resolution is adopted and a certified list of all parcels in the CFD 2004 -1, the Annexation Areas, and the CFD 2004-2 subject to the special tax levy including the amount of the special tax to be levied on each parcel in the CFD 2004-1, the Annexation Areas, and the CFD 2004-2 (the “Fiscal Year 2022/2023 Certified List”) is timely filed by the clerk or other official designated by this Council with the Auditor of the County of Riverside (the “County Auditor”).
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF INDIO ACTING ITS CAPACITY AS LEGISLATIVE BODY OF CITY OF INDIO COMMUNITY FACILITIES DISTRICT NO. 2004 -1 (LAW
ENFORCEMENT, FIRE AND PARAMEDIC SERVICES) AND OF CITY OF INDIO COMMUNITY FACILITIES DISTRICT NO. 2004-2 (LAW ENFORCEMENT, FIRE AND PARAMEDIC SERVICES) DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS:
SECTION 1. The above recitals are true and correct.
SECTION 2. The Finance Director is hereby authorized and directed to determine or cause to be determined the specific rates and amounts of the special tax to be collected from taxable parcels within the CFD 2004 -1, the Annexation Areas, and the CFD
AGENDA ITEM #10.1
Adopt Resolution No. 10278 authorizing the levy of a special tax for Cit... Page 311 of 362 Attachment A
2004-2 for Fiscal Year 2022/2023, provided that such rates and amounts do not exceed the rates previously authorized by the Ordinances.
SECTION 3. The City Manager is hereby authorized and directed to prepare or cause the preparation of the Fiscal Year 2022/2023 Certified List and to submit such list to the County Auditor on or before August 10th or such later date to which the County Auditor may agree.
SECTION 4. The special tax shall be collected in the same manner as ordinary ad valorem property taxes are collected, and shall be subject to the same penalties and same procedure and sale in cases o f any delinquency for ad valorem taxes, and the Tax Collector is hereby authorized to deduct reasonable administrative costs incurred in collecting any said special tax.
SECTION 5. It is hereby further directed that a certified copy of this Resolution, t ogether with the Certified List for Fiscal Year 2022/2023, also be filed with the County Auditor.
SECTION 6. The County Auditor is hereby directed to enter in the next County assessment roll on which taxes will become due, opposite each lot or parcel of land affected in a space marked “public improvements, special tax” or by any other suitable designation, the installment of the special tax.
SECTION 7. The County Auditor shall then, at the close of the tax collection period, promptly render to the City a detailed report showing the amount and/or amounts of such special tax installments, interest, penalties and percentages so collected and from what property collected, and also provide a statement of any percentages retained for the expense of making any such collection.
SECTION 8. This resolution shall become effective upon its adoption.
PASSED, APPROVED and ADOPTED this ________ day of ______________, 2022 by the following votes:
AYES:
NOES:
ABSENT:
ABSTAINED:
MAYOR
ATTEST:
CITY CLERK, CMC
AGENDA ITEM #10.1
Adopt Resolution No. 10278 authorizing the levy of a special tax for Cit... Page 312 of 362 Attachment B
RESOLUTION NO. 10279
RESOLUTION OF THE CI TY COUNCIL OF THE CI TY OF INDIO ACTING IN ITS
CAPACITY AS THE LEGISLATIVE BODY OF CITY OF INDIO COMMUNITY FACILITIES DISTRICT NO. 2004 -3 (TERRA LAGO), AUTHORIZING THE EST ABLISHMENT OF AN ANNUAL SPECIAL TAX W ITHIN IM PROVEMENT AREA 1, ZO NES A AND B FOR FISCAL YEAR 2022/2023
WHEREAS, the City Council (the “Council”) of the City of Indio (the “City”) had previously initiated proceedings, held a public hearing, conducted an election and received a favorable vote from the qualified electors to authorize the levy of special taxes in City of Indio Community Facilities District No. 2004 -3 (Terra Lago) (the “CFD 2004 -3”) as authorized pursuant to the terms and provisions of the “Mello -Roos Community Facilities Act of 1982,” being Chapter 2.5, Part 1, Division 2, Title 5 of the Government Code of the State of California (the “Act”); and
WHEREAS, this Council, by the adoption of an applicable ordinance (the “Ordinance”) , as authorized by Section 53340 of the Government Code of the State of California, has authorized the levy of such special taxes in Improvement Area No. 1 of the CFD 2004-3; and WHEREAS, Government Code Section 53340 provides that this Council may provide, by resolution, for the levy of the special taxes in the CFD 2004-3, in the current tax year at the same rates or at a lower rate than the rate provided for in the Ordinance if such resolution is adopted and a certified list of all parcels in the CFD 2004 -3, subject to the special tax levy including the amount of th e special tax to be levied on each parcel in the CFD 2004 -3 (the “Fiscal Year 2022/2023 Certified List”) is timely filed by the clerk or other official designated by this Council with the Auditor of the County of Riverside (the “County Auditor”).
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF INDIO ACTING IN ITS CAPACITY AS THE LEGISLATIVE BODY OF CITY OF INDIO COMMUNITY FACILITIES DISTRICT NO. 2004 -3 (TERRA LAGO) DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS:
SECTION 1. The above recitals are true and correct.
SECTION 2. The Finance Director is hereby authorized and directed to determine or cause to be determined the specific rates and amounts of the special tax to be collected from taxable parcels within Improvement Area No. 1 of the CFD 2004-3 for Fiscal Year 2022/2023, provided that such rates and amounts do not exceed the rates previously authorized by the Ordinance.
SECTION 3. The City Manager is hereby authorized and directed to prepare or cause the preparation of the Fiscal Year 2022/2023 Certified List and to submit such list to the County Auditor on or before August 10th or such later date to which the County Auditor may agree.
AGENDA ITEM #10.1
Adopt Resolution No. 10278 authorizing the levy of a special tax for Cit... Page 313 of 362 Attachment B
SECTION 4. The special tax shall be collected in the same manner as ordinary ad valorem property taxes are collecte d, and shall be subject to the same penalties and same procedure and sale in cases of any delinquency for ad valorem taxes, and the Tax Collector is hereby authorized to deduct reasonable administrative costs incurred in collecting any said special tax.
SECTION 5. It is hereby further directed that a certified copy of this Resolution, together with the Certified List for Fiscal Year 2022/2023, also be filed with the County Auditor.
SECTION 6. The County Auditor is hereby directed to enter in the next County assessment roll on which taxes will become due, opposite each lot or parcel of land affected in a space marked “public improvements, special tax” or by any other suitable designation, the installment of the special tax.
SECTION 7. The County Auditor shall then, at the close of the tax collection period, promptly render to the City a detailed report showing the amount and/or amounts of such special tax installments, interest, penalties and percentages so collected and from what property collected, and also provide a statement of any percentages retained for the expense of making any such collection.
SECTION 8. This resolution shall become effective upon its adoption.
PASSED, APPROVED and ADOPTED this ________ day of ______________, 2022 by the following votes:
AYES:
NOES:
ABSENT:
ABSTAINED:
MAYOR
ATTEST:
CITY CLERK, CMC
AGENDA ITEM #10.1
Adopt Resolution No. 10278 authorizing the levy of a special tax for Cit... Page 314 of 362 Attachment A
RESOLUTION NO. 10278
RESOLUTION OF THE CI TY COUNCIL OF THE CI TY OF INDIO , ACTING IN ITS
CAPACITY AS THE LEGISLATIVE B ODY OF , AND AUTHORIZING THE
ESTABLISHMENT OF AN ANNUAL SPECIAL TAX F OR, CITY OF INDIO COMMU NITY FACILITIES DISTRICT NO. 2004 -1 (LAW ENFO RCEMENT, FIRE AND PARAM EDIC
SERVICES) AND ANNEXA TION AREAS THERETO, AND FOR CITY OF INDI O COMMUNITY FACILITIES DISTRICT NO. 2004 -2 (LAW ENFORCEMENT, F IRE AND PARAMEDIC SERVICES), FOR FISCAL YEAR 2022/2023
WHEREAS, the City Council (the “Council”) of the City of Indio (the “City”) had previously initiated proceedings, held a public hearing, conducted an election and received a favorable vote from the qualified electors to authorize the levy of special taxes in City of Indio Community Facilities District No. 200 4-1 (Law Enforcement, Fire and Paramedic Services) (the “CFD 2004-1”), Annexation Area Nos. 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 14, 15, 16, 17, 18, 19, 21, 23, 27, 28, 29, 30, 31, 37, 38, 39, 40, 41, 42, 43, 44, 45, 46, 47, 48, 49, 52, 53, 54, 55, 56, 57, 5 8, 59, 60, 61, 62, 63, 64, 65, 67 , 70, 71, 72, 73, 74, 75, 76, 77, 78, 79, 80, 81 and 82 of the CFD 2004-1 (collectively, the “Annexation Areas”), and City of Indio Community Facilities District No. 2004 -2 (Law Enforcement, Fire and Paramedic Services) (th e “CFD 2004 -2”), all as authorized pursuant to the terms and provisions of the “Mello -Roos Community Facilities Act of 1982,” being Chapter
2.5, Part 1, Division 2, Title 5 of the Government Code of the State of California (the “Act”); and WHEREAS, this Co uncil, by the adoption of applicable ordinances (the “Ordinances”) , as authorized by Section 53340 of the Government Code of the State of California, has authorized the levy of such special taxes in the CFD 2004-1, the Annexation Areas, and the CFD 2004-2; and WHEREAS, Government Code Section 53340 provides that this Council may provide, by resolution, for the levy of the special taxes in the CFD 2004 -1, the Annexation Areas, and the CFD 2004 -2 in the current tax year at the same rates or at a lower rate th an the rate provided for in the Ordinances if such resolution is adopted and a certified list of all parcels in the CFD 2004 -1, the Annexation Areas, and the CFD 2004-2 subject to the special tax levy including the amount of the special tax to be levied on each parcel in the CFD 2004-1, the Annexation Areas, and the CFD 2004-2 (the “Fiscal Year 2022/2023 Certified List”) is timely filed by the clerk or other official designated by this Council with the Auditor of the County of Riverside (the “County Auditor”).
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF INDIO ACTING ITS CAPACITY AS LEGISLATIVE BODY OF CITY OF INDIO COMMUNITY FACILITIES DISTRICT NO. 2004 -1 (LAW
ENFORCEMENT, FIRE AND PARAMEDIC SERVICES) AND OF CITY OF INDIO COMMUNITY FACILITIES DISTRICT NO. 2004-2 (LAW ENFORCEMENT, FIRE AND PARAMEDIC SERVICES) DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS:
SECTION 1. The above recitals are true and correct.
SECTION 2. The Finance Director is hereby authorized and directed to determine or cause to be determined the specific rates and amounts of the special tax to be collected from taxable parcels within the CFD 2004 -1, the Annexation Areas, and the CFD
AGENDA ITEM #10.1
Adopt Resolution No. 10278 authorizing the levy of a special tax for Cit... Page 315 of 362 Attachment A
2004-2 for Fiscal Year 2022/2023, provided that such rates and amounts do not exceed the rates previously authorized by the Ordinances.
SECTION 3. The City Manager is hereby authorized and directed to prepare or cause the preparation of the Fiscal Year 2022/2023 Certified List and to submit such list to the County Auditor on or before August 10th or such later date to which the County Auditor may agree.
SECTION 4. The special tax shall be collected in the same manner as ordinary ad valorem property taxes are collected, and shall be subject to the same penalties and same procedure and sale in cases o f any delinquency for ad valorem taxes, and the Tax Collector is hereby authorized to deduct reasonable administrative costs incurred in collecting any said special tax.
SECTION 5. It is hereby further directed that a certified copy of this Resolution, t ogether with the Certified List for Fiscal Year 2022/2023, also be filed with the County Auditor.
SECTION 6. The County Auditor is hereby directed to enter in the next County assessment roll on which taxes will become due, opposite each lot or parcel of land affected in a space marked “public improvements, special tax” or by any other suitable designation, the installment of the special tax.
SECTION 7. The County Auditor shall then, at the close of the tax collection period, promptly render to the City a detailed report showing the amount and/or amounts of such special tax installments, interest, penalties and percentages so collected and from what property collected, and also provide a statement of any percentages retained for the expense of making any such collection.
SECTION 8. This resolution shall become effective upon its adoption.
PASSED, APPROVED and ADOPTED this ________ day of ______________, 2022 by the following votes:
AYES:
NOES:
ABSENT:
ABSTAINED:
MAYOR
ATTEST:
CITY CLERK, CMC
AGENDA ITEM #10.1
Adopt Resolution No. 10278 authorizing the levy of a special tax for Cit... Page 316 of 362 Attachment D
RESOLUTION NO. 10281
RESOLUTION OF THE CI TY COUNCIL OF THE CI TY OF INDIO ACTING IN ITS
CAPACITY AS THE LEGISLATIVE BODY OF CITY OF INDIO COMMUNITY FACILITIES DISTRICT NO. 2006 -1 (SONORA WELLS) AUTHO RIZING THE ESTABLISH MENT OF AN ANNUAL SPECIAL TAX FOR FISCAL YEAR 2022/2023
WHEREAS, the City Council (the “Council”) of the City of Indio (the “City”) had previously initiated proceedings, held a public hearing, conducted an election and received a favorable vote from the qualified electors to authorize the levy of special taxes in City of Indio Community Facilities District No. 2006 -1 (Sonora Wells) (the “CFD 2006 -1”) as authorized pursuant to the terms and provisions of the “Mello -Roos Community Facilities Act of 1982,” being Chapter 2.5, Part 1, Division 2, Ti tle 5 of the Government Code of the State of California (the “Act”); and
WHEREAS, this Council, by the adoption of an applicable ordinance (the “Ordinance”) , as authorized by Section 53340 of the Government Code of the State of California, has authorized t he levy of such special taxes in the CFD 2006-1; and
WHEREAS, Government Code Section 53340 provides that this Council may provide, by resolution, for the levy of the special taxes in the CFD 2006 -1, in the current tax year at the same rates or at a lower rate than the rate provided for in the Ordinance if such resolution is adopted and a certified list of all parcels in the CFD 2006 -1, subject to the special tax levy including the amount of the special tax to be levied on each parcel in the CFD 2006 -1 (the “Fiscal Year 2022/2023 Certified List”) is timely filed by the clerk or other official designated by this Council with the Auditor of the County of Riverside (the “County Auditor”).
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF INDIO ACTING IN ITS CAPA CITY AS THE LEGISLATIVE BODY OF CITY OF INDIO COMMUNITY FACILITIES DISTRICT NO. 2006 -1 (SONORA WELLS) DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS:
SECTION 1. The above recitals are true and correct.
SECTION 2. The Finance Director is hereby authorized and directed to determine or cause to be determined the specific rates and amounts of the special tax to be collected from taxable parcels within the CFD 2006 -1 for Fiscal Year 2022/2023, provided that such rates and amounts do not exceed the rates previously authorized by the Ordinance.
SECTION 3. The City Manager is hereby authorized and directed to prepare or cause the preparation of the Fiscal Year 2022/2023 Certified List and to submit such list to the County Auditor on or before August 10th or su ch later date to which the County Auditor may agree.
AGENDA ITEM #10.1
Adopt Resolution No. 10278 authorizing the levy of a special tax for Cit... Page 317 of 362 Attachment D
SECTION 4. The special tax shall be collected in the same manner as ordinary ad valorem property taxes are collected, and shall be subject to the same penalties and same procedure and sale in cases of an y delinquency for ad valorem taxes, and the Tax Collector is hereby authorized to deduct reasonable administrative costs incurred in collecting any said special tax.
SECTION 5. It is hereby further directed that a certified copy of this Resolution, togethe r with the Certified List for Fiscal Year 2022/2023, also be filed with the County Auditor.
SECTION 6. The County Auditor is hereby directed to enter in the next County assessment roll on which taxes will become due, opposite each lot or parcel of land affected in a space marked “public improvements, special tax” or by any other suitable designation, the installment of the special tax.
SECTION 7. The County Auditor shall then, at the close of the tax collection period, promptly render to the City a detailed report showing the amount and/or amounts of such special tax installments, interest, penalties and percentages so collected and from what property collected, and also provide a statement of any percentages retained for the expense of making any such collection.
SECTION 8. This resolution shall become effective upon its adoption.
PASSED, APPROVED and ADOPTED this ________ day of ______________, 2022 by the following votes:
AYES:
NOES:
ABSENT:
ABSTAINED:
MAYOR
ATTEST:
CITY CLERK, CMC
AGENDA ITEM #10.1
Adopt Resolution No. 10278 authorizing the levy of a special tax for Cit... Page 318 of 362 City of Indio
City Council
May 18, 2022
STAFF REPORT
To: City Council
From: Bryan H. Montgomery, City Manager
Prepared by: Kevin H. Snyder, Dir. Of Community Development Subject: 159 Chapter Amending 1779 Ordinance of Introduction No. (Zoning Regulations) of the Indio Municipal Code to allow Cannabis Storefront Retailer and Cannabis Non-Storefront Retailer Businesses in certain areas of the City and finding that Ordinance No. 1779 is exempt from CEQA pursuant to CEQA Guidelines Section 15061(b)(3)
RECOMMENDATION:
Waive full reading of Ordinance No. 1779 Amending Chapter 159 (Zoning Regulations) of the Indio Municipal and Non Cannabis Retailer Cannabis allow to Code Storefront -Retailer Storefront Businesses in certain area of the City, introduce the ordinance by title only and request the City Clerk to read the title.
SUMMARY:
Beginning in late 2020 and continuing to present, the City Council has conducted public discussions on the potential allowance of cannabis activities in the City inclusive of a joint study session with the Planning Commission on March 2, 2022. At the concl usion of its discussion on March 2, 2022, the City Council directed staff to prepare regulations related to the conduct of Cannabis Storefront Retailer and Cannabis Non-Storefront Retailer Businesses including zoning regulations; for its future review and consideration. The Planning Commission conducted a duly noticed public hearing on April 27, 2022 for the proposed zoning text amendment. There was no written or oral testimony submitted during the public hearing. Following the close of the public hearing, the Planning Commission deliberated and voted 4 -0 to recommend to the City Council the approval of the zoning text amendment. A notice of public hearing for the zoning text amendment before the City Council on May 18, 2022 was published in the Desert Sun, a newspaper of general circulation, on May 6, 2022 exceeding the minimum 10-day public notice period. This notice consisted of an 1/8 of a page display ad for conformity to California Government Code Section 65091.
BACKGROUND INFORMATION:
The Federal Government has issued guidelines for states and local governments that have enacted laws cannabis authorizing -effective and strong implement to related requiring conduct, them regulatory and enforcement systems that will address the threat that medical and adult-use cannabis activity could pose to public safety, public health, and other law enforcement interests.
On June 17, 2017, the Medical and Adult Use-Cannabis Regulation and Safety Act (MAUCRSA) was signed into law, which provides a comprehensive regu latory framework for licensing, control and taxation of medical and adult-use cannabis-related businesses in California.
AGENDA ITEM #10.2
Ordinance No. 1779 Amending Chapter 159 (Zoning Regulations) of the Indi... Page 319 of 362
On December 16, 2017, the Indio City Council adopted Ordinance No. 1726 establishing Subsections 159.565 through 159.568 of the Indio Municipal Code prohibiting commercial cannabis activity in the City.
Beginning in late 2020 and continuing to present, the City Council had conducted public discussions on the potential allowance of cannabis activities in the City inclusive a joint stu dy session with the Planning Commission on March 2, 2022. At the conclusion of the March 2 meeting, the City Council directed staff to prepare regulations related to the conduct of Cannabis Storefront Retailer and Cannabis Non -Storefront Retailer Businesse s in the City. Non -Storefront Retailer businesses are those cannabis businesses that engage in "delivery" only and do not open up their business to the public.
Zoning is a planning control tool used to regulate the physical development of land. Zoning promotes desirable development patterns and protects the public peace, health, safety and general welfare by preventing incompatible uses. Accordingly, amendments to the City's zoning regulations are initially considered by the Planning Commission, which ma kes a recommendation to the City Council. The City Council, in turn, reviews the Commission's recommendation and makes a final decision on the formal adoption of the amendment.
The proposed ordinance permits a cannabis storefront retailer and a cannabis no n-storefront retailer business as a use that is permitted by right in certain land use areas of the City. Specifically, these uses will be permitted in all commercial land use districts except on properties that are zoned Neighborhood Commercial; in all m ixed-use land use districts; and on properties that are within a Specific Plan or Project Master Plan that permit commercial land uses with the exception of properties designated as Neighborhood Commercial. Any other type of commercial cannabis activity i s prohibited.
In addition to the areas where cannabis retailers will be permitted to operate, the proposed ordinance requires that the business obtain a regulatory or business permit from the City as well as a City business license and a State of Calif ornia seller's permit. The City will be adopting the regulatory ordinance separately from this zoning code amendment.
Under State law, personal indoor cultivation is permitted as a matter of right. The provisions in the proposed ordinance related to personal indoor cultivation is a carry -over from the City's current provisions on this topic.
CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) COMPLIANCE
The Community Development Director has determined the amendment to Chapter 159 (Zoning Regulations) of Title XV (Land Usage) is exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15061(b)(3) of the CEQA Guidelines. Adoption of this Ordinance is covered by the common sense exemption in that CEQA applies only to projects which have the potential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity i n question may have a significant effect on the environment, the activity is not subject to CEQA. Here, the Ordinance allows cannabis retailers as a permitted uses in commercial areas of the City including mixed use zones and in area regulated by a specific plan or project master plan that authorizes commercial land uses. These areas already allows for uses akin to cannabis retailers such as general retail outlets and drug stores and the like.
AGENDA ITEM #10.2
Ordinance No. 1779 Amending Chapter 159 (Zoning Regulations) of the Indi... Page 320 of 362
GENERAL PLAN AND ZONING COMPLIANCE
Findings and Conclusions:
The following are the Findings and Conclusions pertaining to the zoning text amendment:
GENERAL PLAN:
The City Council adopted the General Plan 2040 on September 18, 2019. The following are General Plan policies relevant and applicable to the proposed zoning text amendment:
The proposed zoning text amendment is consistent with Policy LU-2.2 (Balanced land uses) that reads “Maintain a balanced land use pattern to support a broad range of housing choices, retail businesses, employment opp ortunities, educational and cultural institutions, entertainment spaces, and other supportive uses and within long -established Indio neighborhoods and new growth areas.” The proposed zoning text amendment will expand the City’s retail base by permitting retail land uses that are not currently allowed to operate within the City limits. Further, the allowance of these businesses will create additional employment opportunities in a retail sector that is not currently operating in the City.
The proposed zoni ng text amendment is consistent with Policy ED -6.1 (New retailers) that reads:
“Where appropriate, support the entry of new retail uses into the City, including uses that will attract spending from visitors and residents of neighboring communities in the C oachella Valley.” The proposed zoning text amendment will expand the City’s retail base by permitting retail land uses that are not currently allowed to operate within the City limits. Cannabis storefront retail activities will attract visitors and residen ts from surrounding communities to purchase cannabis within the City that will result in expanded business activities in the City and increased sales tax revenue directly to the City to support the City’s role as a full-service community.
The proposed z oning text amendment is consistent with Policy ED -6.2 (Retail development) that reads: “Support retail development that meets the community needs of Indio’s residents in appropriate locations in order to prevent the leakage of local expenditures to neighbo ring communities”. The proposed zoning text amendment will authorize new retail uses in the City that are not currently allowed based on the adoption of Ordinance No. 1726 in 2017. Subsequent to this adoption, surrounding communities such as Cathedral City , Coachella, Palm Desert and Palm Springs have adopted regulations that authorize cannabis storefront activities. This has caused leakage in local expenditures as residents and visitors to the City of Indio are spending money in these communities rather than in the City.
ATTACHMENTS:
AttachmentA_OrdinanceNo1779_CannabisZoningTextAmendment
APPROVAL(S):
AGENDA ITEM #10.2
Ordinance No. 1779 Amending Chapter 159 (Zoning Regulations) of the Indi... Page 321 of 362
Kevin H. Snyder, Dir. Of Community Development Approved - 06 May 2022 Roxanne Diaz, City Attorney Approved - 11 May 2022
Rob Rockwell, Asst. City Manager & Dir. Of Finance Approved - 12 May 2022 Bryan H. Montgomery, City Manager Approved - 12 May 2022
AGENDA ITEM #10.2
Ordinance No. 1779 Amending Chapter 159 (Zoning Regulations) of the Indi... Page 322 of 362 12183-0001\2654798v1.doc
ORDINANCE NO. 1779
AN ORDINANCE OF THE CITY OF INDIO AMENDING CHAPTER 159
(ZONING REGULATIONS) OF THE INDIO MUNICIPAL CODE TO ALLOW
CANNABIS STOREFRONT RETAILER AND CANNABIS NON-
STOREFRONT RETAILER BUSINESSES IN COMMERCIAL LAND USE
DISTRICTS EXCEPT FOR THE NEIGHBORHOOD COMMERCIAL ZONE,
MIXED USE LAND USE DISTRICTS AND ON PROPERTIES REGULATED
BY A SPECIFIC PLAN OR PROJECT MASTER PLAN THAT PERMIT
COMMERCIAL LAND USES EXCLUDING ANY PROPERTIES
DESIGNATED AS NEIGHBORHOOD COMMERCIAL; AMENDING THE
SUBCHAPTER ENTITLED CANNABIS ACTIVITY (159.565 ET. SEQ.);
AND MAKING A DETERMINATION THAT THE ORDINANCE IS EXEMPT
FROM REVIEW UNDER CEQA PURSUANT TO CEQA GUIDELINES
SECTION 15061(B)(3)
THE CITY COUNCIL OF THE CITY OF INDIO, CALIFORNIA, DOES HEREBY ORDAIN AS FOLLOWS:
Section 1. Findings. Pursuant to Indio Municipal Code Section 159.875, the City Council the City Council hereby determines and makes the following finding: the proposed change to the zoning code set forth in this Ordinance is consistent with the objectives of Title XV (Land Usage) of the Indio Municipal Code. In addition, the proposed zoning code amendment is consistent with the City of Indio 2040 General Plan Land Use Element Policy LU-2.2 (Balanced Land Uses), Economic Development Policy ED-6.1 (New Retailers) and Economic Development Policy ED-6.2 (Retail Development).
Section 2.Chapter 159 (Zoning Regulations) of Title XV (Land Usage) of the Indio Municipal Code is hereby amended by amending the title of the subchapter currently entitled “Cannabis Activity” and renaming said subchapter as “Commercial Cannabis.”
Section 3.Section 159.565 of Chapter 159 (Zoning Regulations) of Title XV (Land Usage) of the Indio Municipal Code is hereby amended in its entirety to read as follows:
Ҥ 159.565. Permitted Commercial Cannabis Uses.
A. Definitions. The technical terms and phrases used in Sections 159.565 and 159.566 are defined in Section 123.06 of Chapter 123 (Cannabis Business Activities) of Title XI (Business Regulations) of the Indio Municipal Code.
B. Uses Permitted. Cannabis Storefront Retailer and Cannabis Non- Storefront Retailer businesses are permitted land uses in the following land use districts subject to the location requirements set forth herein:
AGENDA ITEM #10.2
Ordinance No. 1779 Amending Chapter 159 (Zoning Regulations) of the Indi... Page 323 of 362 -2-
1. All commercial land use districts except on properties zoned Neighborhood Commercial.
2. All Mixed-Use land use districts.
3. On properties regulated by a Specific Plan or Project Master Plan that permit commercial land uses except for properties zoned or designated as Neighborhood Commercial within the applicable Specific Plan or Project Master Plan.
All other commercial cannabis activities are expressly prohibited.
C. Location Requirement. A Cannabis Storefront Retailer and Cannabis Non-Storefront Retailer shall be no closer than six hundred (600) feet from any zoned parcel in the City designated as a sensitive use pursuant to Indio Municipal Code Section 123.32(B)(2), that is in existence at the time the Cannabis Business Permit is issued. The distance shall be determined by the horizontal distance measured in a straight line from the closest property line of the sensitive use to the closest property line of the lot on which the Cannabis Business is to be located, without regard to intervening structures.
D. Regulatory Permit Required. In order to operate in the areas set forth in paragraph B, a Cannabis Storefront Retailer and a Cannabis Non-Storefront Retailer must obtain and maintain at all times the following permits and licenses: a valid Cannabis Business Permit as required by Chapter 123 of the Indio Municipal Code; a valid business license from the City; and a valid State of California Seller’s Permit.” Section 4.Section 159.566 of Chapter 159 (Zoning Regulations) of Title XV (Land Usage) of the Indio Municipal Code is hereby amended in its entirety to read as follows:
Ҥ 159.566. Personal Indoor Cultivation.
A. Notwithstanding Section 159.565, engaging in the indoor cultivation of six or fewer live cannabis plants within a single private residence or inside an accessory structure located upon the grounds of a private residence that is a fully enclosed and secure structure, to the extent such cultivation is authorized by Cal. Health and Safety Code, §§ 11362.1 and 11362.2, as the same may be amended from time to time, is hereby permitted. The outdoor cultivation, however, of six or fewer live cannabis plants upon the grounds of a private residence is prohibited.” B. For purposes of this Section 159.566, the following definitions shall apply:
“Cultivation” shall mean any activity involving the planting, growing, harvesting, drying, curing, grading or trimming of cannabis.
“Fully enclosed and secure structure” shall mean a space within a building, greenhouse or other structure which has a complete solid roof enclosure supported by connecting walls extending from the ground to the roof, which is secure against
AGENDA ITEM #10.2
Ordinance No. 1779 Amending Chapter 159 (Zoning Regulations) of the Indi... Page 324 of 362 -3-
unauthorized entry, provides complete visual screening, and which is accessible only through one or more lockable doors and inaccessible to minors. “Indoor” shall mean within a fully enclosed and secure structure. “Outdoor” shall mean any location that is not within a fully enclosed and secure structure.”
“Private residence” shall mean a house, an apartment unit, a condominium unit, a mobile home or other similar dwelling that is lawfully used as a residence.” Section 5.Section 159.567 and Section 159.568 are hereby repealed in their entirety.
Section 6.The City Council, through an exercise of its independent judgement, finds and determines that this Ordinance is exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15061(b)(3) of the CEQA Guidelines. Adoption of this Ordinance is covered by the commonsense exemption in that CEQA applies only to projects which have the potential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA. Here, the Ordinance allows cannabis retailers as a permitted uses in commercial areas of the City including mixed use zones and in area regulated by a specific plan or project master plan that authorizes commercial land uses. These areas already allows for uses akin to cannabis retailers such as general retail outlets and drug stores and the like. Accordingly, the City Council directs City staff to file a Notice of Exemption.
Section 7. Severability. If any section, subsection, subdivision, paragraph, sentence, clause or phrase of this ordinance or its application to any person or circumstance, is for any reason held to be invalid or unenforceable by a court of competent jurisdiction, such invalidity or unenforceability shall not affect the validity or enforceability of the remaining sections, subsections, subdivisions, paragraphs, sentences, clauses or phrases of this ordinance, or its application to any other person or circumstance. The City Council declares that it would have adopted each section, subsection, subdivision, paragraph, sentence, clause, phrase hereof, irrespective of the fact that any one or more sections, subsections, subdivisions, paragraphs, sentences, clauses or phrases hereof be declared invalid or unenforceable.
Section 8.The City Clerk shall certify to the adoption of this Ordinance and shall cause the same to be published in the manner prescribed by law.
AGENDA ITEM #10.2
Ordinance No. 1779 Amending Chapter 159 (Zoning Regulations) of the Indi... Page 325 of 362 -4-
PASSED, APPROVED, and ADOPTED this 18th day of May 2022 by the following vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
___________________________
WAYMOND FERMON, MAYOR
ATTEST:
__________________________
CYNTHIA HERNANDEZ
CITY CLERK
APPROVED AS TO FORM:
__________________________
ROXANNE DIAZ
CITY ATTORNEY
AGENDA ITEM #10.2
Ordinance No. 1779 Amending Chapter 159 (Zoning Regulations) of the Indi... Page 326 of 362 City of Indio
City Council
May 18, 2022
STAFF REPORT
To: City Council
From: Bryan H. Montgomery, City Manager
Prepared by: Roxanne Diaz, City Attorney
Subject: Introduction of Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Municipal to regulate and permit commercial cannabis activities in the City; and making a determination that the Ordinance is not subject to the California Environmental Quality Act pursuant to CEQA Guidelines 15060(c)(3)
RECOMMENDATION:
Waive full reading of Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Municipal Code to regulate and permit commercial cannabis activities in the City, introduce the ordinance by title only and request the City Clerk to read the title.
SUMMARY:
Ordinance No. 1780 establishes a regulatory framework to permit commercial cannabis activities in the City. If adopted, the ordinance will permit only cannabis retail activity. Staff and the City’s consultant will return with proposed policies and procedures for the processing, review and selection of the applications at a later date. Separately, the City Council also has before it a related land use ordinance that establishes the locations in the City where retail commercial cannabis businesses are permitted.
BACKGROUND INFORMATION:
In the later part of 2021, the City Council requested that the City Manager bring forward the discussion on permitting cannabis uses in the City. To that end, the City engaged Hinderliter, De Llamas and Associates (“HdL”) to assist the City with the discussion and potential drafting of an ordinance. HdL is a leader in cannabis consulting services, providing jurisdictions in California, with assistance or development of regulations and/or ordinances, application proc ess development, application review, tax administration including audit services and other services related to the cannabis industry. HdL proceeded with meeting with staff in addition to providing an overview of the economic market conditions and approach to the City Council at various study sessions. The result is the proposed ordinance which has previously been reviewed with the Council and the Planning Commission for the City Council’s formal consideration.
Ordinance No. 1780 provides the regulatory framework for permitting commercial cannabis activities in the City. As proposed, the ordinance permits cannabis retail activity, establishes sensitive use buffers and establishes requirements regarding security, recordkeeping, signage, odor and customer access. This ordinance does not establish the locations where cannabis retail businesses can locate.
The location for such businesses is set forth in a separate land use ordinance that will also be reviewed AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 327 of 362 by the City Council at the May 18, 2022 meeting. This ordinance also does not establish the process by which applications for permits will be processed, reviewed or selected. This will be further delineated in a resolution to be adopted by the City Council at a later date as authorized by Section 123.13 of Ordinance No. 1780.
As stated above, this regulatory ordinance provides detailed general operating requirements in the following areas: odor control, age -verification, signage, background checks, record keeping and inventory tracking. In addition , hours of operation for the retail businesses are limited to 9:00 am through 9:00 p.m., seven days a week and no on -site consumption is allowed. The ordinance also contains detailed security requirements such as exterior lighting, alarm system, 24-hour video camera surveillance, panic buttons and requires the business owner to establish emergency response protocols. Last, each commercial cannabis business will be required to enter into an operating agreement with the City prior to opening that will include a negotiated public benefit fee and any other community benefits that is offered by the business.
Staff reviewed Ordinance No. 1780 and determined that as a regulatory ordinance, Ordinance No. 1780 is not subject to the California Environmental Quali ty Act (“CEQA”) as it is not a project as defined by CEQA.
ATTACHMENTS:
Ordinance No. 1780
APPROVAL(S):
Kevin H. Snyder, Dir. Of Community Development Approved - 12 May 2022 Roxanne Diaz, City Attorney Approved - 12 May 2022
Rob Rockwell, Asst. City Manager & Dir. Of Finance Approved - 13 May 2022 Bryan H. Montgomery, City Manager Approved - 13 May 2022
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 328 of 362
ORDINANCE NO. 1780
AN ORDINANCE OF THE CITY OF INDIO ADDING A NEW CHAPTER
123 ENTITLED CANNABIS BUSINESS ACTIVITIES TO TITLE XI,
BUSINESS REGULATIONS , OF THE INDIO MUNICIPAL CODE TO
REGULATE COMMERCIAL CANNABIS USES IN THE CITY
THE CITY COUNCIL OF THE CITY OF INDIO DOES ORDAIN AS FOLLOWS:
SECTION 1. Chapter 123 (Cannabis Activities) of Title XI (Business Regulations) of the Indio Municipal Code is hereby repealed in its entirety.
SECTION 2. A new Chapter 123 entitled “Cannabis Business Activities” is hereby added to Title XI (Business Regulations) of the Indio Municipal Code to read as follows:
“CHAPTER 123
CANNABIS BUSINESS ACTIVITIES
123.01 Title
123.02 Purpose and Intent
123.03 Legal Authority
123.04 Commercial Cannabis Activities Prohibited Unless Specifically Authorized by this Chapter
123.05 Compliance with State and Local Laws and Regulations 123.06 Definitions
123.07 Cannabis Business Permit Required to Engage in Cannabis Business Activity
123.08 Cannabis Owners and Employee Criminal Background 123.09 Persons Prohibited from Holding a Permit or from Employment with a Cannabis Business Permittee
123.10 Maximum Number and Type of Authorized Cannabis Business es Permitted
123.11 Community Benefits
123.12 City’s Reservation of Rights
123.13 Procedure Guidelines and Review Criteria to Evaluate Cannabis Business Permit Applications
123.14 Exercise of a Cannabis Business Permit
123.15 Abandonment of Permit
123.16 Reapplying for a Cannabis Business Permit
123.17 Term of a Cannabis Business Permit
123.18 Renewal of Cannabis Business Permits
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 329 of 362
123.19 Suspension, Revocation, or Modification of Permits 123.20 Effect of State License Suspension
123.21 Effect of State License Revocation or Termination 123.22 Appeals
123.23 Appeals and Contents of Appeal
123.24 Appointment of Hearing Officer or Body
123.25 Appeal Hearing Process and Proceedings
123.26 Change in location; Updated Application Form
123.27 Transfer of Cannabis Business Permit
123.28 City Business License
123.29 Building Permits and Inspection
123.30 Authorization from the Community Development Director 123.31 Right to Occupy and to Use Property
123.32 Location and Design of Cannabis Businesses
123.33 Limitations on City’s Liability
123.34 Records and Recordkeeping
123.35 Security Measures
123.36 Fees and Charges
123.37 General Operating Requirements
123.38 Operating Requirements for Store Front Retail Facilities 123.39 Operating Requirements for Non-Store Front Retail (Delivery-Only) Facilities.
123.40 Store Front and Non-Store Front Retail Delivery Requirements. 123.41 Operating Requirements for Out-of-City Delivery Services 123.42 Permissible Delivery Locations and Customers
123.43 Promulgation of Regulations, Standards and Other Legal Duties 123.44 Community Relations
123.45 Fees Deemed Debt to the City
123.46 Permit Holder Responsible for Violations
123.47 Inspection and Enforcement
123.48 Violations Declared a Public Nuisance
123.49 No Vested Rights
123.01 Title.
This Chapter shall be known as the Cannabis Activities Ordinance of the City of Indio.
123.02 Purpose and Intent.
It is the purpose and intent of this Chapter to implement the provisions of the Medicinal and Adult Use Cannabis Regulation and Safety Act (“MAUCRSA”) to accommodate the needs of medically-ill persons in need of cannabis for medicinal purposes as recommended by their health care provider(s), and to provide access to same. It is also the purpose and intent of this Chapter to provide access to adult-use cannabis for persons aged 21 and over as authorized by the
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 330 of 362
MAUCRSA, while imposing sensible regulations on the use of land to protect the City’s residents, neighborhoods, and businesses from disproportionately negative impacts. It is the purpose and intent of this Chapter to regulate the commercial sale and delivery of cannabis and cannabis products in a responsible manner to protect the health, safety, and welfare of the residents of the City and to enforce rules and regulations consistent with state law.
123.03 Legal Authority.
This Chapter is adopted pursuant to the authority granted to the City by Section 7 of Article XI of the California Constitution, Title 4, Division 19 of the California Code of Regulations, and the provisions of the MAUCRSA.
123.04 Commercial Cannabis Activities Prohibited Unless Specifically Authorized by this Chapter.
Except as specifically authorized by this Chapter, the commercial cultivation, manufacture, processing, storing, laboratory testing, labeling, sale, delivery, distribution, or transportation, of cannabis or cannabis products is expressly prohibited in the City.
123.05 Compliance with State and Local Laws and Regulations.
It is the responsibility of the owners and /or operators of any Commercial Cannabis Business within the City limits to ensure that they operate in a manner compliant with this Chapter, all applicable state and local laws, and any regulations promulgated thereunder , including but not limited to the MAUCRSA.
123.06 Definitions.
(A) “Applicant” means a person or entity that submits an application for a Cannabis Business Permit under this Chapter.
(B) “Cannabis” shall have the same meaning as that appearing in Business and Professions Code Section 26001(f).
(C) Cannabis Products shall have the same meaning as that appearing in Business and Professions Code Section 26001(h).
(D) “City” shall mean the City of Indio, California.
(E) “City Manager” shall mean the City of Indio City Manager or his or her designee.
(F) “Commercial Cannabis Business” or “Cannabis Business” means any business or operation which engages in medicinal or adult -use commercial cannabis activity authorized by this Chapter.
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 331 of 362
(G) “Cannabis Business Permit” means a regulatory permit issued by the City pursuant to this Chapter, to a Commercial Cannabis Business and is required before any commercial cannabis activity may be conducted in the City. The initial permit and annual renewal of a permit is made expressly contingent upon the business’ ongoing compliance with all of the requirements of this Chapter and any regulations adopted by the City governing the commercial cannabis activity at issue.
(H) “Cannabis Business Permittee” or “Permittee” means a person or entity that has received a Cannabis Business Permit from the City as authorized under this Chapter
(I) Delivery shall have the same meaning as that appearing in Business and Professions Code Section 26001(o).
(J) “Dispensing” means any activity involving the retail sale of cannabis or cannabis products from a retailer.
(K) “Limited-access area” means an area in which cannabis is stored or held and is only accessible to a permittee and authorized personnel.
(L) “Medicinal cannabis” or “Medicinal cannabis product” shall have the same meaning as that appearing in Business and Professions Code Section 26001(ai).
(M) “Non-Storefront retailer” is a subset of “Retailer” and is a permitted retail business that is closed to the public and provides product to customers solely by means of a delivery service which the retailer owns and controls.
(N) “Owner” means any of the following:
(1) A person with an aggregate ownership interest of 10 percent or more in the Commercial Cannabis Business , unless the interest is solely a security, lien or encumbrance.
(2) An individual who manages, directs, or controls the operations of the Commercial Cannabis Business, including but not limited to:
(a) A member of the board of directors of a nonprofit.
(b) A general partner of a Commercial Cannabis Business that is organized as a partnership.
(c) A non-member manager or manager of a Commercial Cannabis Business that is organized as a limited liability company.
(d) The trustee(s) and all persons who have control of the trust and/or the Commercial Cannabis Business that is held in trust.
(e) An individual wi th the authority to provide strategic direction and oversight
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 332 of 362
for the overall operations of the Commercial Cannabis Business , such as the chief executive officer, president or their equivalent, or an officer, director, vice president, general manager or their equivalent.
(f) An individual with the authority to execute contracts on behalf of the Commercial Cannabis Business.
(g) When an entity is an owner in a Commercial Cannabis Business, all entities and individuals with a financial interest in the entity shall be disclosed to the City and may be considered owners of the Commercial Cannabis Business . For example, this includes all entities in a multi - layer business structure, as well as the chief executive officer, members of the board of directors, partners, trustees and all persons who have control of a trust and managing members or non -member managers of the entity. Each entity disclosed as having a financial interest must disclose the identities of persons holding financial interests until only individuals remain.
(O) “Package” means any container or receptacle used for holding cannabis or cannabis products.
(P) “Person” shall mean any individual, firm, partnership, joint venture, association, corporation, limited liability company, estate, trust, business trust, receiver, syndicate, or any other group or combination acting as a unit.
(Q) “Physician’s recommendation” shall have the same meaning as that appearing in Business and Professions Code Section 26001(ap).
(R) “Premises” all have the same meaning as that appearing in Business and Professions Code Section 26001(aq).
(S) “Retailer” or “Storefront Retailer” shall have the same meaning as th at contained in Section 26070(a)(1) of the California Business and Professions Code.
(T) “State license” means a permit or license issued by the State of California, or one of its departments or divisions, under the MAUCRSA and any subsequent related State of California legislation , to engage in cannabis activity. A state license alone will not authorize the holder to operate a Cannabis Business, as state law also requires a license or other authorization issued by a local jurisdiction.
(U) “Youth center” means any:
(1) Public or private facility that is primarily used to host recreation or social activities for minors, including, but not limited to:
(a) Private youth membership organizations or clubs,
(b) Social service teenage club facilities,
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 333 of 362
(c) Video arcades where 10 or more video games or game machines or devices are operated, and where minors are legally permitted to conduct business, or (d) Similar amusement park facilities, and
(e) Must be used for youth activities at least 60 percent of the time in a calendar year.
(2) It shall also include a park, playground or recreational area specifically designed to be used by children which has play equipment installed, including public grounds designed for athletic activities such as baseball, softball, soccer, or basketball or any similar facility located on a public or private school grounds, or on City, county, or state parks.
(3) This definition shall not include any private martial arts, yoga, ballet, music , art studio or similar studio of this nature nor shall it include any pri vate gym, athletic training facility, pizza parlor, dentist office, doctor’s office primarily serving children or a location which is primarily utilized as an administrative office or facility for youth programs or organizations.
123.07 Cannabis Business Permit Required to Engage in Cannabis Business Activity.
No person may engage in any Cannabis Business within the City, including cultivation, manufacture, processing, laboratory testing, distributing, dispensing, or sale of cannabis or a cannabis product, unless the person meets all of the following requirements:
(A) Possess a valid Cannabis Business Permit from the City;
(B) Possess a valid business license from the City;
(C) Possess a valid State of California Seller’s Permit; and
(D) Is currently in compliance with all applicable state and local laws and regulations pertaining to the Cannabis Business and the cannabis activities, including the duty to obtain any required state licenses.
123.08 Cannabis Owners and Employee Criminal Background.
(A) Any person who is an owner, employee or who otherwise works within a Cannabis Business must be legally authorized to do so under applicable state law.
(B) Cannabis Business owners, and employees shall be required to submit to a criminal background check for themselves and all persons in their employment. Business owners shall be required to complete a criminal background check prior to issuance or transfer of a Cannabis Business Permit. Employees shall submit to a criminal background check within one month of being hired.
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 334 of 362
(C) The City shall conduct criminal background checks which must, at a minimum, identify the following:
(1) Whether the owner or employee has ever been convicted of a violent felony as defined by California Penal Code 667.5 or equivalent offense in other states;
(2) Whether the owner or employee has ever been convicted of a serious felony, as defined by California Penal Code 1192.7 or equivalent offense in other states;
(3) Whether the owner or employee has ever been con victed of a felony for hiring, employing, or using a minor in transporting, carrying, selling, giving away, preparing for sale, or peddling, any controlled substance to a minor; or selling, offering to sell, furnishing, offering to furnish, administering, or giving any controlled substance to a minor;
(4) Whether the owner or employee has ever been convicted of a felony for drug trafficking with enhancements pursuant to Section 11370.4 or 11379.8 of the Health and Safety Code; or
(5) Whether the owner or employee has ever been convicted of a felony involving fraud, deceit, or embezzlement.
(D) Evidence of a conviction of any the offenses enumerated in Section 123.08(c) of this Code shall be grounds for denial or revocation of a Cannabis Business Permit, and/or employment with a Cannabis Business permittee in the City of Indio.
123.09 Persons Prohibited from Holding a Permit or from Employment with a Cannabis Business Permittee.
(A) A person is prohibited from holding or maintaining a Cannabis Business Permit, or from being employed at a Cannabis Business, if any of the following apply:
(1) The applicant has been denied a cannabis license or permit, or has had a cannabis license or permit suspended or revoked by any city, county, city and county or any other state cannabis licensing authority;
(2) The applicant was notified by the state, county, or city that it was conducting cannabis activity in violation of State law or City ordinances, codes, and requirements, and failed to cure the violation in a timely manner;
(3) Evidence that the applicant is delinquent in payment of f ederal, state, or local taxes and/or fees, and took no steps to cure the delinquency when notified by the appropriate agencies;
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 335 of 362
123.10 Maximum Number and Type of Authorized Cannabis Businesses Permitted.
This section is intended to create a maximum number and types of Cannabis Businesses that may be issued permits to operate in the City.
(A) The following cannabis license types are authorized to operate in the City of Indio.
(1) Cannabis Storefront Retailer.
(2) Cannabis Non-Storefront Retailer.
(B) Cannabis license types not identified in Section 123.10 (A) are prohibited from obtaining a Cannabis Business Permit in the City of Indio.
(C) The number of each type of Cannabis Business that shall be permitted to operate in the City shall be established by resolution by the City Council.
(D) Notwithstanding Section 123.10 (C), the total number of allowable Cannabis Storefront Retail permits established by City Council resolution shall be no more than one (1) permit for every fifteen thousand (15,000) residents in the City of Indio, and no less than one (1) permit for every twenty -five thousand (25,000) residents in the City of Indio. The population of the City of Indio shall be based on the official census population estimate, as periodically updated by the US Department of Commerce, Census Bureau.
(E) Each year following the City’s initial award of permits, if any, or at any time in the City Council’s discretion, the City Council may reassess the number of Cannabis Business Permits which are authorized for issuance and make any changes by resolution.
(F) The City Council, at its sole discretion, may determine that the number and/or types of Cannabis Business Permits should remain the same or be modified.
123.11 Community Benefits.
(A) The application Procedure Guidelines and Review Criteria, set forth in Section 123.13 of this Chapter, shall include a component on community benefits.
(B) Any community benefits that a Cannabis Business agrees to provide shall be incorporated into the terms and conditions under whi ch the Cannabis Business will operate with the City’s approval, if and when a Cannabis Business Permit is issued. Such terms and conditions shall be in addition to the requirements of this Chapter.
123.12 City’s Reservation of Rights.
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 336 of 362
The City reserves the right to reject any or all applications for a Cannabis Business Permit. Prior to permit issuance, the City may modify, postpone, or cancel any request for applications, at any time without liability, obligation, or commitment to any party, firm, or organization, to the extent permitted under California law . Persons submitting applications assume the risk that all or any part of the Cannabis Business Permit program, or any particular category of permit potentially authorized under this Chapter, may be cancelled at any time prior to permit issuance. The City further reserves the right to request and obtain additional information from any candidate submitting an application. In addition to a failure to comply with other requirements in this Chapter, an application may be rejected for any of the following reasons:
(A) The application was received after the designated time and date of the deadline.
(B) The application did not contain the required elements, exhibits, or was not organized in the required format.
(C) The application was considered not fully responsive to th e request for a permit application, i.e. was substantially incomplete.
123.13 Procedure Guidelines and Review Criteria to Evaluate Cannabis Business Permit Applications.
(A) By resolution, the City Council shall adopt Procedure Guidelines and Review Criteria for the City’s evaluation of Cannabis Business permit applications and subsequent issuance.
(B) The Procedure Guidelines shall provide the process for soliciting applications including time frames, limitations, requirements, forms, and rules for completing applications.
(C) The Review Criteria shall include detailed instructions on the methodology to be used to evaluate applications on a point , or other evaluation system, tied to particular sets of criteria.
(D) The Review Criteria shall be used to determine which candidates will be eligible to proceed to the final selection process as determined by City Council resolution.
(E) The City Manager shall be authorized to prepare any necessary forms and adopt any necessary rules to implement the Procedure Guidelines and Review Criteria.
(F) At the time of filing, each applicant shall pay an application fee established by resolution of the City Council to cover all costs incurred by the City in the application process.
(G) For applicants with ten or more employees, the applicant shall attest that the applicant will enter into a labor peace agreement as defined in Business and Professions Code Section 26001(y) and will abide by the terms of the agreement, and the applicant shall provide a copy thereof to the City. For applicants that have not yet entered into a labor
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 337 of 362
peace agreement, the applicant shall provide a notarized statement indicating that within 30-days of cannabis permit from the City, the applicant will enter into and abide by the labor peace agreement.
123.14 Exercise of a Cannabis Business Permit.
(A) A Cannabis Business Permit shall be exercised within twelve ( 12) months of the final selection process, as defined by the Procedure Guideline and Review Criteria. A Cannabis Business Permit shall be considered exercised shall be when any of the following occur:
(1) A Certificate of Occupancy has been issued,
(2) The permitted use(s) has commenced on the site, and
(3) A City Building Permit or Grading Permit is secured, and construction lawfully commenced.
(B) Failure to exercise a Cannabis Business Permit within the timeframe established in Section 123.14 (A) shall result in denial of the application.
(C) The City Manager, in his/her sole discretion, may extend the timeframe established in Section 123.14 (A), if he/she determines that the applicant has made a good faith effort to exercise the Cannabis Business Permit within the defined timeframe.
123.15 Abandonment of Permit.
If the Cannabis Business has not been in regular and continuous operation in the preceding four (4) months at the permitted location , the Cannabis Business Permit shall be considered abandoned, unless mitigating circumstance occur which was beyond the control of the permittee and an extension has been authorized by the City Manager.
123.16 Reapplying for a Cannabis Business Permit.
If an applicant is denied a permit due to a disqualifying factors including, but not limited to, failing a background check or not complying with any state, or local jurisdictions regulatory requirements in which legal or administrative action has been taken, a new application may not be filed by the applicant for one (1) year from the date of the denial. This section shall not apply to an approved applicant not awarded a permit resulting from the City not selecting them for one of the permits in the application process.
123.17 Term of a Cannabis Business Permit.
All permits issued under the provisions of this chapter shall be effective for a period not to exceed one (1) year from the date of issuance . The City Manager may renew a permit through the
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 338 of 362
procedures identified in Section 123.18 of this Code.
123.18 Renewal of Cannabis Business Permits.
(A) An application for renewal of a Cannabis Business Permit shall be filed by the Cannabis Business Permittee at least sixty (60) calendar days prior to the expiration date of the current permit.
(B) The renewal application shall contain all the information required for new applications.
(C) The applicant shall pay a fee in an amount to be set by the City Council to cover the costs of processing the renewal permit application, together with any costs incurred by the City to administer the program created under this Chapter.
(D) An application for renewal of a Cannabis Business Permit may be rejected if any of the following exists:
(1) The application is filed less than sixty (60) days before its expiration or a shorter time period which shall be at the discretion of the City Manager.
(2) The Cannabis Business Permit is suspended or revoked at the time of the application.
(3) The Cannabis Business has not been in regular and continuous operation in the four (4) months prior to the renewal application or the approved extension of the deadline from the City Manager.
(4) The Cannabis Business has failed to conform to the requirements of the Cannabis Business Permit or this Chapter or any regulations adopted pursuant to this Chapter.
(5) The permittee fails or is unable to renew its State of California license.
(6) If the state has determined, based on substantial evidence, that the permittee or applicant is in violation of the requirements of the state rules and regulations and the state has determined that the violation is grounds for termination or revocation of the Cannabis Business Permit.
(7) Violation of Section 123.08 of this Code.
(E) The City Manager is authorized to make all decisions concerning the issuance of a renewal permit. In making the decision, the City Manager is authorized to impose additional conditions to a renewal permit, if it is determined to be necessary to ensure compliance with state or local laws and regulations or to preserve the public health, safety, or welfare.
Appeals from the decision of the City Manager shall be handled pursuant to this Chapter.
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 339 of 362
(F) If a renewal application is denied, a person may file a new application pursuant to this Chapter not sooner than one (1) year from the date of the denial.
123.19 Suspension, Revocation or Modification of Permits.
Cannabis Business Permits may be suspended, revoked or modified for any violation of this Chapter, any state or local laws, rules, and/or any standards, policies, procedures, or regulations adopted pursuant to this Chapter relating to Cannabis Businesses. A decision of the City to suspend, revoke or modify a Cannabis P ermit is appealable as set forth in this Chapter.
123.20 Effect of State License Suspension.
Suspension of a license issued by the State of California, or by any of its departments or divisions, shall immediately suspend the Cannabis Business Permit of the Cannabis Business. If the State of California or its respective department or division reinstates or reissues the State license , the Cannabis Business may seek reinstatement of its Cannabis Business Permit if the business can demonstrate that the grounds for revocation of the license by the state no longer exist or that the underlying deficiency has otherwise been cured. Any Cannabis Business Permittee shall inform the City of any suspension of a state license.
123.21 Effect of State License Revocation or Termination.
Revocation or termination of a license issued by the State of California, or by any of its departments or divisions, shall immediately revoke or terminate the Cannabis Business Permit of the Cannabis Business. Any Cannabis Business Permittee shall inform the City of any revocation or termination of a state license.
123.22 Appeals.
Appeals relating to denial of an application; to revoke , suspend or modify a permit; to deny renewal of an application for a permit; or to add conditions to a permit shall be conducted as prescribed in this Chapter.
123.23 Appeals and Contents of Appeal
(A) Within ten (10) calendar days after service of the notice of the decision of the City to deny advancement to the final selection process; to revoke, suspend or modify a permit; to deny a renewed application for a permit; or to add conditions to a permit, an applicant or permittee may appeal such action by filing a written appeal with the City Clerk setting forth the reason why the decision was not proper. For appeals of a denial of an application prior to the final decision process, reasons shall be stated with specificity and shall address the issues outlined in Section 123.24 (A). Date of service shall mean the date when a notice or written decision was personally delivered to the applicant or permittee
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 340 of 362
or the date when the notice was caused to be delivered by certified, first class mail. In cases in which the city can verify delivery of a notice to an applicant or in which an applicant is documented as refusing delivery, lack of receipt of the notice cannot form the basis for an appeal.
(B) The Notice of Appeal shall be in writing and signed by the person making the appeal (“Appellant”), or their legal representative, and shall contain the following:
(1) Name, address, and telephone number of the appellant.
(2) Specify decisions, actions, or a particular part thereof, made that are the subject of the appeal.
(3) Include a true and correct copy of the notice issued by the City Manager for which the appellant is appealing.
(4) State with specificity the reasons and grounds for making the appeal, including, but not limited to, a statement of facts upon which the appeal is based in sufficient detail to enable the City Council, or any appointed hearing officer, to understand the nature of the controversy, the basis of the appeal, and the relief requested.
(5) All documents or other evidence pertinent to the appeal that the appellant requests the hearing officer or body to consider at the hearing.
(6) An appeal fee as established by Resolution of the City Council.
(A) Failure of the City Clerk to receive a timely appeal constitutes a waiver of the right to appeal the notice issued by the City Mana ger. In this event, the City Manager’s notice of revocation, nonrenewal, or suspension shall be final.
(B) In the event a written Notice of Appeal is timely filed, the nonrenewal, suspension, or revocation shall not become effective until a final decision has been rendered and issued by the City Council or appointed hearing officer. Notices of appeal not served in a timely manner or served by non -operational business shall not serve to allow such business to operate pending appeal.
(C) If no appeal is timely filed in the event of a decision of nonrenewal, the Cannabis Businesses Permit shall expire at the conclusion of the term of the permit. If no appeal is timely filed in the event of a decision supporting suspension or revocation, the suspension or revocation shall become effective upon the expiration of the period for filing a written Notice of Appeal.
123.24 Appointment and Scope of Hearing Officer or Body.
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 341 of 362
(A) Denial of Application Prior to Final Decision Process. The City Manager, or an appointed hearing officer, as set forth by City Council Resolution, will hear appeals that address the following issues:
(1) Any deviation from the City’s published Procedure Guidelines and Review Criteria that adversely affected the applicant by altering the outcome of the City’s decision on the application. Examples of appealable deviations include, but are not limited to:
i. Failure on the part of the City to provide appropriate notification regarding changes to the application process via website postings and/or email to the applicant prior to the time the application was submitted;
ii. Failure on the part of the City to provide an applicant an equal opportunity to modify an application where that opportunity was provided to other applicants;
iii. Failure on the part of the City to correctly apply the Review Criteria, as established by City Council resolution, in reviewing the application;
(2) Any appeal based upon this section must be supported by a preponderance of the evidence that the applicant presented the relevant information with completeness and in the appropriate section of the applica tion. Information presented in the application that is incomplete in nature or that is relevant to a question posed by the City on the application form but appears in the incorrect section, even if complete, may be grounds for the dismissal of the appeal.
(B) All Other Appeals. The City Council, or an appointed hearing officer or body, as set forth by City Council Resolution, shall hear appeals relating the denial of a renewed application, revocation, suspension or modification a permit, or addition of conditions to a permit.
(C) Notwithstanding Section 123.24 (A) (1), a n applicant that is eligible to participate in the final selection process, as set forth in the Procedure Guidelines and Review Criteria , but is not selected during the final selection process, shall not be eligible to appeal the outcome of the process.
123.25 Appeal Hearing Process and Proceedings.
(A) Review by City Council, City Manager, Appointed Hearing Officer or Body.
(1) Appellants who file a timely written Notice of Appeal will be entitled to an administrative hearing before the City Council, City Manager, hearing officer or body, as set forth by the City Council by Resolution.
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 342 of 362
(2) Upon receipt by the City Clerk of a timely-filed Notice of Appeal, the City Clerk shall forward such appeal to the hearing officer who shall schedule a hearing within thirty days (30) days. In the event such hearing cannot be heard within that time period or a mutually agreed upon time with the appellant, then the City Clerk shall schedule the appeal to be heard within forty-five (45) days or as reasonably possible.
(3) The appellant(s) listed on the written Notice of Appeal shall be notified in writing of the date, time, and location of the hearing at least ten (10) days before the date of the hearing (“Notice of Appeal Hearing”).
(4) A request by an appellant or by the City to continue a hearing must be submitted to the City Clerk in writing no later than three (3) business days before the date scheduled for the hearing. The City Council, City Manager, appointed hearing officer or body may continue a hearing for good cause or on its own motion; however, in no event may the hearing be continued for more than thirty (30) calendar days, unless there is a stipulation by all parties to do so.
(B) At the date, time and location set forth in the Notice of Appeal Hearing, the City Council, City Manager, appointed Hearing Officer or body shall hear and consider the testimony of the appellant(s), City staff, and/or their witnesses, as well as any documentary evidence properly submitted for consideration.
(C) The following rules shall apply at the appeal hearing:
(1) Appeal hearings are informal, and formal rules of evidence and discovery do not apply. However, rules of privilege shall be applicable to the extent they are permitted by law, and irrelevant, collateral, undue, and repetitious testimony may be excluded.
(2) The City bears the burden of proof to establish the grounds for nonrenewal, suspension, revocation, modification of the permit , or adding conditions to the permit by a preponderance of evidence. Appellant(s) bear the burden of proof regarding denial of an application or denial of advancement to the final selection process established by the City Council.
(3) The issuance of the City’s notice constitutes prima facie evidence of grounds for the denial, nonrenewal, suspension or revocation.
(4) The hearing officer or body may accept and consider late evidence not submitted initially with the Notice of Appeal upon a showing by the appellant of good cause.
The hearing officer or body shall determine whether a particular fact or set of facts amount to good cause on a case-by-case basis.
(5) The appellant may bring a language interpreter to the hearing at their sole expense.
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 343 of 362
(6) The City may, at its discretion, record the hearing by stenographer or court reporter, audio recording, or video recording. If the a ppellant requests from the City that a court reporter, stenographer, or videographer be used, appellant shall bear the costs of same and shall deposit such fees prior to commencement of the administrative hearing.
(D) If the appellant, or their legal repres entative, fails to appear at the appeal hearing, the City Council, City Manager, appointed hearing officer or body, may cancel the appeal hearing and send a notice thereof to the appellant by certified, first class mail to the address(es) stated on the Notice of Appeal. A cancellation of a hearing due to non - appearance of the appellant shall constitute the appellant’s waiver of the right to appeal and a failure to exhaust all administrative remedies. In such instances, the City’s notice of decision is final and binding.
(E) Final Decision. Following the conclusion of the hearing , the City Council, City Manager, appointed hearing officer or body shall issue a written decision within twenty (20) days which (i) determines if the action appealed from is affirmed or overturned and (ii) specifies the reasons for the decision.
(F) The written decision of the City Council, City Manager, appointed hearing officer or body shall provide that it is final and conclusive and is subject to the time limits set forth in California Code of Civil Procedure Section 1094.6 for judicial review.
(G) A copy of the written decision shall be served by certified, first class mail on the appellant.
If the appellant is not the owner of the real property in which the Cannabis Business is located, or proposed to be located, a copy of the final decision may also be served on the property owner by first class mail to the address shown on the last equalized assessment roll. Failure of a person to receive a properly addressed final decision shall not invalidate any action or proceeding by the City pursuant to this Chapter.
123.26 Change in Location; Updated Application Form.
(A) Any time the business location specified in the regulatory permit is changed, the permittee shall submit an updated application form to the City Manager for approval prior to the change in location . The process and the fees for the processing of the application form shall be the same as the process and fees set forth in Sections 123.18 and 123.27.
(B) Within fifteen (15) calendar days of any other change in the information provided in the updated application form or any change in status of compliance with the provisions of this Chapter, including any change in the Cannabis Business ownership or management members, the applicant shall file an updated application form with the City Manager for review along with an application amendment fee.
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 344 of 362
123.27 Transfer of Cannabis Business Permit.
(A) The owner of a Cannabis Business Permit shall not transfer ownership or control of the permit to another person or entity unless and until the transferee obtains an amendment to the permit from the City Manager stating that the transferee is now the permittee.
Such an amendment may be obtained only if the transferee files an application with the City Manager in accordance with the provisions of this Chapter (as though the transferee were applying for an original Cannabis Business Permit). The proposed transferee’s application shall be accompanied by a transfer fee in an amount set by resolution of the City Council (or if not set, shall be the same amount as the application fee). The transferee’s application will be treated as a new applica tion, and will be evaluated according to procedures adopted by the City Manager, pursuant to Section 123.43.
(B) Cannabis Business Permits issued through the grant of a transfer by the City Manager shall be valid for a period of one year beginning on the day the City Manager approves the transfer of the permit. Before the transferee’s permit expires, the transferee shall apply for a renewal permit and pay the appropriate fee in the manner required by this Chapter.
(C) A Cannabis Business Permit shall not be transferred w hen the City has notified the permittee in writing that the permit has been or may be suspended or revoked.
(D) Any attempt to transfer a Cannabis Business Permit either directly or indirectly in violation of this section is hereby declared a violation of the permit and this Chapter. Such a purported transfer shall be deemed a ground for revocation of the permit.
123.28 City Business License.
Prior to commencing operations, a Cannabis Business shall obtain a City of Indio business license.
123.29 Building Permits and Inspection.
Prior to commencing operations, a Cannabis Business permittee shall be subject to a mandatory building inspection and must obtain all required permits and approvals which would otherwise be required for any business of the same size and intensity operating in that zone. This includes but is not limited to obtaining any required building permit(s), Fire Department approvals, Police Department approval, Code Enforcement, Planning, and County Health Department approvals , and any other applicable zoning and land use permit(s) and approvals.
123.30 Authorization from the Community Development Director.
Prior to commencing operations, a Cannabis Business must obtain authorization from the Community Development Director certifying that the business is located on a site that meets all of the requirements of Sections 123.29, 123.31 and 123.32 of this Code.
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 345 of 362
123.31 Right to Occupy and to Use Property.
Prior to the City ’s issuance of a Cannabis Business Permit pursuant to this Chapter, any person intending to open and to operate a Cannabis Business shall first provide sufficient evidence of the legal right to occupy and to use the proposed location. If the proposed location will be leased from the property owner , the applicant shall be required to provide a signed and notarized statement from the owner of the property, acknowledging that the property owner has read this Chapter and consents to the operation of the Cannabis Business on the owner’s property.
123.32 Location and Design of Cannabis Businesses.
(A) A Cannabis Business must meet land use and building standards pursuant to Title 15 of this Code, including:
(1) Conform with the City ’s general plan, any applicable specific plan, master plan, and design requirements.
(2) Comply with all applicable zoning and related development standards.
(3) Be constructed in a manner that minimizes odors to surrounding uses, and promotes quality design and construction, and consistency with the surrounding properties.
(B) A Cannabis Business must meet the following rules relating to proximity to sensitive uses:
(1) Shall be no closer than six hundred (600) feet from any zoned parcel in the City designated as a sensitive use under Section 123.32 (B) (2), that is in existence at the time the permit is issued . The distance shall be determined by the horizontal distance measured in a straight line from the closest property line of the sensitive use to the closest property line of the lot on which the Cannabis Business is to be located, without regard to intervening structures.
(2) Sensitive uses include:
(a) A school providing instruction in kindergarten or any grades 1 through 12, (whether public, private, or charter, including pre -school, transitional kindergarten, and K-12).
(b) A commercial daycare center licensed by the State, County or City.
(c) A Youth Center.
123.33 Limitations on City’s Liability.
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 346 of 362
To the fullest extent permitted by law, the City of Indio shall not assume any liability whatsoever with respect to having issued a Cannabis Business Permit pursuant to this Chapter or otherwise approving the operation of any Cannabis Business. As a condition to the approval of any Cannabis Business Permit, the applicant shall be required to meet all of the following conditions prior to receiving the Cannabis Business Permit:
(A) Execute an agreement, in a form approved by the City Attorney, agreeing to indemnify, defend (at applicant’s sole cost and expense), and hold the City of Indio, and its officers, officials, employees, representatives, and agents, harmless, from any and all claims, losses, damages, injuries, liabilities or losses which arise out of, or which are in any way related to, the City ’s issuance of the Cannabis Business Permit, the City ’s decision to approve the operation of the Cannabis Business or activity, the process used by the City in making its decision, or the alleged violation of any federal, state or local laws by the Cannabis Business or any of its officers, employees or agents.
(B) Maintain insurance at coverage limits, and with conditions thereon determined necessary and appropriate from time to time by the City’s Risk Manager.
(C) Reimburse the City for all costs and expenses, including but not limited to legal fees and court costs, which the City may be required to pay as a result of any legal challenge related to the City’s approval of the applicant’s Cannabis Business Permit or related to the City ’s approval of a cannabis activity. The City, at its sole discretion, may participate at its own expense in the defense of any such action, but such participation shall not relieve the applicant of any of the obligations imposed hereunder.
123.34 Records and Recordkeeping.
(A) Each owner and operator of a Cannabis Business shall maintain accurate books and records in an electronic format, detailing all of the revenues and expenses of the business, and all of its assets and liabilities for a period not less than seven (7) years. On no less than an annual basis (at or before the time of the renewal of a Cannabis Business Permit issued pursuant to this Chapter), or at any time upon reasonable request of the City, each Cannabis Business shall file a sworn statement detailing the number and amount of sales by the Cannabis Business during the previous twelve -month period (or shorter period based upon the timing of the request), provided on a per -month basis. The statement shall also include gross sales for each month, and all applicable taxes and/or fees paid or due to be paid. On an annual basis, each owner and operator shall submit to the City a financial audit of the business’s operations conducted by an independent certified public accountant. Each permittee shall be subject to a regulatory compliance review and a gross receipts financial audit, where applicable, as determined by the City.
(B) Each owner and operator of a Cannabis Business shall maintain a current register of the names and the contact information (including the name, address, and telephone number)
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 347 of 362
of anyone owning or holding an interest in the Cannabis Business, and separately of all the officers, managers, employees, agents, and volunteers currently employed or otherwise engaged by the Cannabis Business. The register required by this paragraph shall be provided to the City Manager upon request.
(C) All Cannabis Business es shall maintain an inventory control and reporting system that accurately documents the present location, amounts, and descriptions of all cannabis and cannabis products for all stages of the growing and production or manufacturing, laboratory testing processes until purchase as set forth in the MAUCRSA.
123.35 Security Measures.
(A) A Cannabis Business permittee shall implement sufficient security measures to deter and prevent the unauthorized entrance into areas containing cannabis or cannabis products and to deter and prevent the theft of cannabis or cannabis products at the Cannabis Business. Except as may otherwise be determined by the City Manager, these security measures shall include, but shall not be limited to, all of the following:
(1) Perimeter fencing and exterior lighting systems (including motion sensors) for after- hours security as approved by the Chief of Police and/or the Community Development Director were applicable.
(2) Preventing individuals from remaining on the premises of the Cannabis Business if they are not engaging in an activity directly related to the permitted operations of the Cannabis Business. In cases in which the individual will not voluntarily leave the premises, the cannabis employee shall contact the Police Department.
(3) Establishing limited access areas accessible only to authorized Cannabis Business personnel.
(4) Installing 24 -hour security surveillance cameras of at least high-definition (HD) quality to monitor all entrances and exits to and from the premises, all interior spaces within the Cannabis Business which are open and accessible to the public, all interior spaces where cannabis, cash, or currency, is being stored for any period of time on a regular basis and all interior spaces where diversion of cannabis could reasonably occur. All cameras shall record in color. All exterior cameras shall be in weather-proof enclosures, shall be located so as to minimize the possibility of vandalism, and shall have the capability to automatically switch to black and white in low light conditions. The Cannabis Business shall be responsible for ensuring that the security sur veillance camera’s footage is remotely accessible by the City Manager, and that it is compatible with the City ’s software and hardware. In addition, if required, remote and real-time, live access to the video footage from the cameras shall be provided to the Chief of Police at the expense of the permittee.
Video recordings shall be maintained for a minimum of ninety (90) days and shall be
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 348 of 362
made available to the Chief of Police upon request. Video shall be of sufficient quality for effective prosecution of any crime found to have occurred on the site of the Cannabis Business and shall be capable of enlargement via projection or other means. Internet Protocol address information shall be provided to the Police Department by the Cannabis Business, to facilitate remote monitoring of security cameras by the Department or its designee. Each business shall have network security protocols that are certified by Underwriters Laboratories.
(5) Sensors shall be installed to detect entry and exit from all secure areas and shall be monitored in real time by a security company licensed by the State of California Bureau of Security and Investigative Services.
(6) Panic buttons shall be installed in all Cannabis Businesses with direct notification to the Police Department dispatch and shall be configured to immediately alert dispatch for the Police Department.
(7) Having a professionally installed, maintained, and monitored real -time alarm system by a security company licensed by the State of California Bureau of Security and Investigative Services. The permittee shall be required to obtain an alarm permit from the Police Department.
(8) Any security measures, such as bars, installed on the windows or the doors of the Cannabis Business shall be installed only on the interior of the building.
(9) Security personnel shall be on -site 24 hours a day or alternative security as authorized by the City Manager and must have a security patrol when closed.
Security personnel must be licensed by the State of California Bureau of Security and Investigative Se rvices personnel and shall be subject to the prior review and approval of the City Manager, with such approval not to be unreasonably withheld.
(10) Each Cannabis Business shall have the capability to remain secure during a power outage and shall ensure that all access doors are not solely controlled by an electronic access panel to ensure that locks are not released during a power outage.
(11) Each Cannabis Business shall have an accounting software system in place to provide point of sale data as well as audit trails o f both product and cash, where applicable.
(12) Each Cannabis Business shall demonstrate to the Chief of Police, City Manager or their designees, compliance with the state’s track and trace system for cannabis and cannabis products.
(13) Each Cannabis Business shall have a professionally installed video surveillance system, access control and intrusion alarm systems designed to protect the
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 349 of 362
inventory, facility, and employees. Each business shall have network security protocols that are certified by Underwriters Laboratories.
(14) Exterior vegetation shall be planted, altered and maintained in a fashion that precludes its use as a hiding place for persons on the premises.
(15) Emergency access and emergency e vacuation plans that are in compliance with state and local fire safety standards.
(B) Each Cannabis Business shall identify a designated security representative/liaison to the City, who shall be reasonably available to meet with the City Manager regarding any security related measures and /or operational issues. The designated security representative/liaison shall, on behalf of the Cannabis Business, annually maintain a copy of the current security plan on the premises of the business, to present to the City Manager upon request that meets the following requirements:
(1) Confirms that a designated Manager will be on duty during business hours and will be responsible for monitoring the behavior of employees.
(2) Identifies all Managers of the Cannabis Business and their contact phone numbers.
(3) Confirms that first aid supplies and operational fire extinguishers are located in the service areas and the Manager’s office.
(4) Confirms that burglar, fire, and panic alarms are operational and monitored by a licensed security company 24 hours a day, seven days a week, and provides contact information for each licensed security company.
(5) Identifies a sufficient number of licensed, interior , and exterior security personnel who will monitor individuals inside and outside the Cannabis Business, the parking lot, any adjacent property under the business’ control, and ensure that the parking lot is cleared of employees and their vehicles one-half hour after closing.
(C) As part of the application and licensing process each Cannabis Business shall have a storage and transportation plan, which describes in detail the procedures for safely and securely storing and transporting all cannabis, cannabis products, any hazardous materials that may be used by the business, and any currency.
(D) The Cannabis Business shall cooperate with the City whenever the City Manager makes a request, with or without prior notice, to inspect or audit the effectiveness of any security plan or of any other requirement of this Chapter.
(E) A Cannabis Business shall notify the City Manager within twenty -four (24) hours after discovering any of the following:
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 350 of 362
(1) Significant discrepancies identified during inventory. The level of significance shall be determined by the regulations promulgated by the City Manager.
(2) Diversion, theft, loss, or any criminal activity involving the Cannabis Business or any agent or employee of the Cannabis Business.
(a) The loss or unauthorized alteration of records related to cannabis, customers or employees or agents of the Cannabis Business.
(b) Any other breach of security.
(F) Compliance with the foregoing requirements shall be verified by the City Manager prior to commencing business operations. The City Manager may supplement these security requirements once operations begin, subject to review by the City Manager if requested by the business owner.
123.36 Fees and Charges.
(A) No person may commence or continue any cannabis activity in the City, without timely paying in full all fees and charges required for the operation of a Cannabis Business. Fees and charges associated with the operation of a cannabis activity shall be established by resolution of the City Council which may be amended from time to time.
(B) All Cannabis Businesses authorized to operate under this Chapter shall pay all sales, use, business and other applicable taxes, and all license , permit, registration, and other fees required under federal, state, and local law. Each Cannabis Business shall cooperate with the City with respect to any request to audit the Cannabis Business’ books and records for the purpose of verifying compliance with this section, including but not limited to a verification of the amount of taxes or fees required to be paid during any period.
(C) Prior to operating in the City and as a condition of issuance of a permit, the operator of each cannabis facility shall enter into a n operational and/or community benefit agreement with the City setting forth the terms and conditions under which the cannabis facility will operate that are in addition to the requirements of this Chapter, including, but not limited to, public outreach and education, community service, payment of fees and other charges as mutually agreed, and such other terms and conditions that will protect and promote the public health, safety and welfare.
123.37 General Operating Requirements.
(A) Cannabis Business es may operate only during the hours specified in the Cannabis Business Permit issued by the City.
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 351 of 362
(B) Restriction on Sales and Consumption. Cannabis shall not be consumed by any person on the premises of any Cannabis Business . No person shall cause or permit the sale, dispensing, or consumption of alcoholic beverages or tobacco on or about the premises of the Cannabis Business.
(C) No cannabis or cannabis products or graphics depicting cannabis or cannabis products shall be visible from the exterior of any property issued a Cannabis Business Permit, or on any of the vehicles owned or used as part of the Cannabis Business. No outdoor storage of cannabis or cannabis products is permitted at any time.
(D) Reporting and Tracking of Product and of Gross Sales. Each Cannabis Business shall have in place a point-of-sale or management inventory tracking system to track and report on all aspects of the Cannabis Business including, but not limited to, such matters as cannabis tracking, inventory data, gross sales (by weight and by sale) and other information which may be deemed necessary by the City. The Cannabis Business shall ensure that such information is compatible with the City ’s record-keeping systems. In addition, the system must have the capability to produce historical transactional data for review. Furthermore, any system selected must be approved and authorized by the City Manager prior to being used by the permittee.
(E) All cannabis and cannabis products sold, distributed, or manufactured shall be cultivated, manufactured, and transported by state licensed facilities that maintain operations in full conformance with the State and local regulations.
(F) Emergency Contact. Each Cannabis Business shall provide the City Manager with the name, telephone number (both land line and mobile, if available) of an on-site employee or owner to whom emergency notice can be provided at any hour of the day.
(G) Signage and Notices.
(1) In addition to the requirements otherwise set forth in this sec tion, business identification signage for a Cannabis Business shall conform to the requirements of Chapter 150 Billboards and Signs, including, but not limited to, seeking the issuance of a City sign permit.
(2) No signs placed on the premises of a Cannabis Business shall obstruct any entrance or exit to the building or any window.
(3) Each entrance to a Cannabis Business shall be visibly posted with a clear and legible notice indicating that smoking, ingesting, or otherwise consuming cannabis on the premises or in the areas adjacent to the Cannabis Business is prohibited.
(4) Business identification signage shall be limited to that needed for identification only and shall not contain any logos or information that identifies, advertises, or lists the
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 352 of 362
services or the products offered. No Cannabis Business shall advertise by having a person holding a sign and advertising the business to passersby, whether such person is on the premises of the Cannabis Business or elsewhere including, but not limited to, the public right-of-way.
(5) Signage shall not depict any image of cannabis or cannabis products. No banners, flags, snipe signs, billboards, or other prohibited signs may be used at any time.
(6) In accordance with state law and regulations or as stipulated in the City’s Cannabis Business Permit, holders of a Cannabis Business Permit shall agree that, as an express and ongoing condition of permit issuance and subsequent renewal, the holder of the permit shall be prohibited from advertising any Cannabis Business located in the city limits utilizing a billboard (fixed or mobile), bus shelter, placard, aircraft, or other similar forms of advertising. This paragraph is not intended to place limitations on the ability of a Cannabis Business to advertise in other legally authorized forms, including on the internet, in magazines, or in other similar ways.
(H) Minors.
(1) Persons under the age of twenty-one (21) years shall not be allowed on the premises of a Cannabis Business and shall not be allowed to serve as a driver for a mobile delivery service. It shall be unlawful and a violation of this Chapter for any person to employ any person at a Cannabis Business who is not at least twenty-one (21) years of age.
(2) The entrance to the Cannabis Business shall be clearly and legibly posted with a notice that no person under the age of twenty-one (21) years of age is permitted to enter upon the premises of the Cannabis Business.
(3) Notwithstanding Section 123.37(h)(1), persons aged 18 to 20 years shall be allowed on the premises of a Cannabis Business if they can produce a physician’s recommendation. In that event, such persons can lawfully purchase cannabis for the sole purpose of addressing the medical need that is the subject of the physician’s recommendation.
(I) Odor Control. Odor control devices and techniques shall be incorporated in all Cannabis Businesses to ensure that odors from cannabis are not detectable off -site. Cannabis Businesses shall provide a suffici ent odor absorbing ventilation and exhaust system so that odor generated inside the Cannabis Business that is distinctive to its operation is not detected outside of the facility, anywhere on adjacent property or public rights -of-way, on or about the exterior or interior common area walkways, hallways, breezeways, foyers, lobby areas, or any other areas available for use by common tenants or the visiting public, or within any other unit located inside the same building as the Cannabis Business. As such, Cannabis Business es must install and maintain the following equipment, or any
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 353 of 362
other equipment which the Community Development Director or his/her designee(s) determine is a more effective method or technology:
(1) An exhaust air filtration system with odor control that prevents internal odors from being emitted externally;
(2) An air system that creates negative air pressure between the Cannabis Business’s interior and exterior, so that the odors generated inside the Cannabis Business are not detectable on the outside of the Cannabis Business.
(J) Display of Permit and City Business License. The original copy of the Cannabis Business Permit issued by the City pursuant to this Chapter and the City issued business license shall be posted inside the Cannabis Business in a location readily visible to the public.
(K) Background Check. Pursuant to California Penal Code Sections 11105(b)(11) and 13300(b)(11), which authorizes City authorities to access state and local summary criminal history information for cannabis employment, licensing, or certification purposes and authorizes access to federal level criminal history information by transmitting fingerprint images and related information to the Department of Justice to be transmitted to the Federal Bureau of Investigation, every person listed as an owner or employee must submit fingerprints and other information deemed necessary by the Chief of Police or his/her designee(s) for a background check by the City of Indio Police Department .
Pursuant to California Penal Sections 11105(b)(11) and 13300(b)(11), which requires that there be a requirement or exclusion from cannabis employment, licensing or certification based on specific criminal conduct on the part of the subject of the record, no person shall be issued a permit to operate a Cannabis Business or be allowed to work in a Cannabis Business unless they have first cleared the background check, as determined by the Chief of Police or his/her designee(s) , as required by this section. A fee for the cost of the background investigation, which shall be the actual cost to the City of Indio to conduct the background investigation as it deems necessary and appropriate, shall be paid at the time the application for a Cannabis Business Permit is submitted. Evidence of a conviction of any of the offenses enumerated in Business and Professions Code Section 26057(b)(4), absent a Certificate of Rehabilitation, shall be grounds for immediate disqualification of the applicant.
(L) Loitering. The owner and/or operator of a Cannabis Business shall prohibit loitering by persons outside the facility both on the premises and within fifty (50) feet of the premises.
The Cannabis Business shall notify the Police Department if anyone continues to loiter around the building or premises after all reasonable action has been taken to remove the individual(s) and the action has failed to do so in a timely manner.
(M) Permits and other Approvals. Prior to the establishment of any Cannabis Business or the operation of any such business, the person intending to establish a Cannabis Business must first obtain all applicable planning, zoning, building, and other applicable permits
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 354 of 362
from the relevant governmental agency which may be applicable to the zoning district in which such Cannabis Business intends to establish and to operate pursuant to Section 123.32 and all applicable requirements in this Chapter.
(N) Each cannabis operator shall establish minimum training standards for all employees. The City Manager shall have the discretion to require other training for the business operations should the City identify deficiencies or non -compliance issues with City or state requirements.
123.38 Operating Requirements for Store Front Retail Facilities.
(A) No more than the number of cannabis retailers adopted by Council resolution may operate within the City at any one time and shall be issued a permit by the City.
(B) Retailers shall verify the age and all necessary documentation of each individual to ensure the customer is not under the age of eighteen (18) years . If the potential customer is 18 to 20 years old, retailer shall confirm the customer’s possession of a valid doctor's recommendation and/or H ealth and Safety Code Section 11362.71 identification ca rd (Medical Marijuana Card). For adult-use purchases, retailers shall verify that all customers are 21 years of age or older for the purchase of cannabis or cannabis products.
(C) Individuals must show their government-issued identification, and, in the case of medical cannabis facilities, their physician’s recommendation, or a cannabis card issued pursuant to Health and Safety Code Section 11362.71 in order to gain access into the retailer. The government-issued identification and, if applicable, doctor’s rec ommendation or cannabis card must also be shown at the point-of-sale station at the time of purchase.
Doctor recommendations are not to be obtained or provided at the retail location.
(D) Uniformed licensed security personnel shall be employed to monitor site activity, control loitering and site access, and to serve as a visual deterrent to unlawful activities. Security personnel may be allowed to carry firearms if authorized by the Chief of Police.
(E) Retailers may have only that quantity of cannabis and cannabis products to meet the daily demand readily available for sale on-site in the retail sales area of the retailer. Additional product may be stored in a secured, locked area to which customers, vendors, and visitors shall not have access.
(F) All restroom facilities shall remain locked and under the control of management.
(G) Permitted Store Front Retailers are authorized to conduct cannabis sales by delivery, pursuant to the requirements set forth in Section 123.40.
(H) Retailers authorized to conduct retail activities shall only serve customers who are within
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 355 of 362
the permitted premises, or at a delivery address that meets the requirements of this division.
(1) The sale and delivery of cannabis goods shall not occur through a pass -through window or a slide-out tray to the exterior of the premises.
(2) Retailers shall not operate as or with a drive -in or drive-through at which cannabis goods are sold to persons within or about a motor vehicle.
(3) No cannabis goods shall be sold and/or delivered by any means or method to any person within a motor vehicle.
(4) All cannabis goods sold by a retail business shall be contained in child -resistant packaging.
(5) Retailers shall record point -of-sale areas and areas where cannabis goods are displayed for sale on the video surveillance system. At each point -of-sale location, camera placement must allow for the recording of the facial features of any person purchasing or selling cannabis goods, or any person in the retail area, with sufficient clarity to determine identity.
(6) A retail permittee who is engaged in retail sale shall hire or contract for security personnel who are at least 21 years of age to provide security services for the permitted retail premises. All security personnel hired or contracted for by the permittee shall be licensed by the Bureau of Security and Investigative Services and shall comply with Division 3 of the Business and Professions Code.
(I) Access to Retailer Premises.
(1) Access to the premises of a retail permittee shall be limited to individuals who are at least 21 years of age.
(2) Notwithstanding Section 123.37 (h)(1), individuals who are at least 18 years of age and in possession of a valid physician’s recommendation shall be granted access to the premises of a retail permittee for the sole purpose of purchasing medicinal cannabis consistent with the physician’s recommendation.
(I) Authorized Sales. A retailer shall only sell adult -use cannabis and adult -use cannabis products to individuals who are at least 21 years of age. A retailer shall only sell medicinal cannabis or medicinal cannabis products to individuals who are at least 18 years of age, but not yet 21, if those individuals are in possession of a valid physician’s recommendation. Medicinal cannabis sales to individua ls 21 years of age and older are unrestricted.
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 356 of 362
(J) Limited Access Areas. A retailer shall establish limited -access areas and permit only authorized individuals to enter the limited -access areas. Authorized individuals include individuals employed by the retailer as well as any outside vendors, contractors, or other individuals conducting business that requires access to the limited access area. All individuals granted access to the limited access area shall be at least 21 years of age, and if not employed by the retailer, shall be escorted at all times b y an employee of the permittee. A retailer shall maintain a log of all individuals who are not employees who are granted access to the limited access area. These logs shall be made available to the City Manager, Chief of Police, or their designees upon request.
(K) Operating hours of the Store Front Retailer Permit shall be limited to the hours of 9:00 a.m. through 9:00 p.m., seven days a week.
(L) Store Front/Retail Security Requirements. All provisions incorporated within Section 123.35 of this Code (Security Measures), are directly applicable to and binding on all Cannabis Businesses, including all Store Front/Retail businesses.
123.39 Operating Requirements for Non-Store Front Retail (Delivery-Only) Facilities.
(A) No more than the number of Non-Store Front Retailers adopted by Council resolution may operate within the City at any one time and shall be issued a permit by the City.
(B) A non-storefront retailer permittee shall be authorized to conduct retail sales exclusively by delivery. The permitted premises of a non-storefront retailer permittee shall be closed to the public.
(C) A non-storefront retailer permittee shall comply with all the requirements applicable to retailer permittees, except for those provisions related to public access to the permitted premises and the retail area.
(D) Operating hours of the Non -Store Front Retailer Permit shall be limited to the hours of 9:00 a.m. through 9:00 p.m., seven days a week.
123.40 Store Front and Non-Store Front Retail Delivery Requirements.
(A) Prior to providing cannabis goods to a delivery customer, operators are required to verify the age and the necessary documentation of each customer. They must ensure that medical customers are at least eighteen (18) years of age and verify that the customer has a valid doctor’s recommendation. In the case of adult-use customers, they must verify that the customer is at least twenty -one (21) years of age. Sales shall only be made to persons matching these criteria.
(B) Retail delivery services shall be limited to the hours of 9:00 a.m. through 9:00 p.m., seven days a week.
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 357 of 362
(C) Prior to commencing delivery operations, a cannabis Retailer and cannabis Non -Store Front Retailer shall provide the following information to the City:
(1) Proof of ownership of the vehicle or a valid lease for any and all vehicles that will be used to deliver cannabis or cannabis products.
(2) The year, make, model, color, license plate number, and numerical Vehicle Identification Number (VIN) for any and all vehicles that will be used to deliver cannabis goods.
(3) Proof of insurance as required in Section 123.33(b) for any and all vehicles being used to deliver cannabis goods.
(4) The permittee shall provide the City with the information required by this section in writing for any new vehicle that will be used to deliver cannabis goods prior to using the vehicle to deliver cannabis goods.
(5) The permittee shall provide the City with any changes to the information required by this section in writing within thirty (30) calendar days.
123.41 Operating Requirements for Out-of-City Delivery Services.
(A) All Cannabis Businesses which conduct deliveries into or within the City of Indio shall be required to obtain a permit from the City of Indio in order to conduct retail sales regardless of whether they are located in the City or another local jurisdiction.
(B) Prior to commencing operations, a cannabis out -of-City delivery service shall comply with the following requirements:
(1) Obtain from the City a permit authorizing the delivery of cannabis and cannabis products within the City limits. A copy of this permit shall be retained by all drivers.
(2) The retail business operating the delivery service shall provide the City Manager with evidence of a valid state and local license for a Cannabis Business on whose authorization the delivery service is performing the delivery function.
(3) The retail business operating the delivery service shall furnish to the City Manager the year, make, model, license plate number, and numerical Vehicle Identification Number (VIN) for any and all vehicles that will be used to deliver cannabis goods.
(C) Operating hours of the Out-of-City Delivery Service shall be limited to the hours of 9:00 a.m. through 9:00 p.m., seven days a week.
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 358 of 362
123.42 Permissible Delivery Locations and Customers.
Cannabis delivery businesses permitted to engage in delivery of cannabis and cannabis products inside the City of Indio are subject to the following requirements:
(A) A permitted Cannabis Business shall not deliver cannabis goods to an address located on publicly owned land or any address on land or in a building leased by a public agency.
(B) A permitted Cannabis Business shall comply with all requirements of state and local law pertaining to the Cannabis Business Permit and all subsequent policies, procedures and regulations which may be amended by the City Manager from time to in order to enforce this Chapter.
(C) Any kiosk , i -Pad, tablet, smartphone, fixed location or technology platform, whether manned or unmanned, other than a retail location permitted by the city, that facilitates, directs, or assists the retail sale or delivery of cannabis or cannabis products is prohibited and shall be a violation of this Chapter.
123.43 Promulgation of Regulations, Standards and Other Legal Duties.
(A) In addition to any regulations adopted by the City Council, the City Manager is authorized to establish administratively any additional rules, regulations and standards governing the issuance, denial or renewal of Cannabis Business Permits, the ongoing operation of Cannabis Businesses and the City 's oversight, or concerning any other subject determined to be necessary to carry out the purposes of this Chapter.
(B) Regulations shall be published on the City ’s website.
(C) Regulations promulgated by the City Manager shall become effective upon date of publication. Cannabis Businesses shall be required to comply with all state and local laws and regulations, including but not limited to any rules, regulations or standards adopted by the City Manager.
123.44 Community Relations.
(A) Each Cannabis Business shall provide the name, telephone number, and email address of a community relations contact to whom notice of problems associated with the Cannabis Business can be provided. Each Cannabis Business shall also provide the above information to all businesses and residences located within one hundred (100) feet of the Cannabis Business.
(B) During the first year of operation pursuant to this Chapter, the owner, manager, and community relations representative from each Cannabis Business holding a permit issued pursuant to this Chapter shall attend meeting s with the City Manager, and other
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 359 of 362
interested parties as deemed appropriate by the City Manager, to discuss costs, benefits, and other community issues arising as a result of implementation of this Chapter. After the first year of operation, the owner, manager, and community relations representative from each such Cannabis Business shall meet with the City Manager when and as requested by the City Manager.
123.45 Fees Deemed Debt to the City.
The amount of any fee, cost or charge imposed pursuant to this Chapter shall be deemed a debt to the City that is recoverable via an authorized administrative proc ess as set forth in the City ordinance or in any court of competent jurisdiction.
123.46 Permit Holder Responsible for Violations.
The person to whom a permit is issued pursuant to this Chapter shall be responsible for all violations of the laws of the State of California or of the regulations and/or the ordinances of the City, whether comm itted by the permittee or any employee or agent of the permittee, which violations occur in or about the premises of the Cannabis Business whether or not said violations occur within the permit holder’s presence.
123.47 Inspection and Enforcement.
(A) The City Manager, or designee charged with enforcing the provisions of the City of Indio Municipal Code, or any provision thereof, may enter the location of a Cannabis Business at any time, without notice, and inspect the location of any Cannabis Business as well as any recordings and records required to be maintained pursuant to this Chapter or under applicable provisions of State law.
(B) It is unlawful for any person having responsibility over the operation of a Cannabis Business, to impede, obstruct, interfere with, or otherwise not to allow, the City to conduct an inspection, review or copy records, recordings or other documents required to be maintained by a Cannabis Business under this Chapter or under state or local law. It is also unlawful for a person to conceal, destroy, deface, damage, or falsify any records, recordings or other documents required to be maintained by a Cannabis Business under this Chapter or under state or local law.
(C) The City Manager, or designee charged with enforcing the provisions of this Chapter may enter the location of a Cannabis Business at any time during the hours of operation and without notice to obtain samples of the cannabis to test for public safety purposes. Any samples obtained by the City of Indio shall be logged, recorded, and maintained in accordance with established procedures by the City of Indio’s City Manager or these regulations.
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 360 of 362
123.48 Violations declared a public nuisance.
Each and every violation of the provisions of this Chapter constitutes a misdemeanor and is hereby deemed unlawful and a public nuisance. The City reserves the right to pursue any available legal remedy to address violations of this Chapter.
123.49 No Vested Rights
No person(s) (including any Applicant, Owner, and/or Permittee) shall have any vested rights to any permit, right, and/or interest under this chapter, regardless of whether such person(s) sold, distributed, and/or otherwise engaged in acts related to the use of Cannabis prior to the adoption of the ordinance codified in this Chapter.”
SECTION 2. CEQA. The City Council finds and determines that this Ordinance is not subject to the California Environmental Quality Act (“CEQA”) pursuant to the State CEQA Guidelines Section 15060(c)(3), because it is not a project as defined by the CEQA Guidelines Section 15378.
Adoption of the Ordinance does not have the potential for resulting in either a direct physical change in the environment or a reason ably foreseeable indirect physical change in the environment as it is an ordinance setting forth the regulatory process for cannabis permits.
SECTION 3. Severability. If any section, subsection, subdivision, paragraph, sentence, clause or phrase of this ordinance or its application to any person or circumstance, is for any reason held to be invalid or unenforceable by a court of competent jurisdiction, such invalidity or unenforceability shall not affect the validity or enforceability of the remainin g sections, subsections, subdivisions, paragraphs, sentences, clauses or phrases of this ordinance, or its application to any other person or circumstance. The City Council declares that it would have adopted each section, subsection, subdivision, paragr aph, sentence, clause, phrase hereof, irrespective of the fact that any one or more sections, subsections, subdivisions, paragraphs, sentences, clauses or phrases hereof be declared invalid or unenforceable.
SECTION 4. The City Clerk shall certify to the adoption of this Ordinance and shall cause the same to be published in the manner prescribed by law.
PASSED, APPROVED, and ADOPTED this 1st day of June 2022 by the following vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 361 of 362
___________________________
WAYMOND FERMON, MAYOR
ATTEST:
__________________________
CYNTHIA HERNANDEZ
CITY CLERK
APPROVED AS TO FORM:
__________________________
ROXANNE DIAZ
CITY ATTORNEY
AGENDA ITEM #11.1
Ordinance No. 1780 adding a new Chapter 123 to Title XI of the Indio Mun... Page 362 of 362