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www.modestogov.com
AGENDA
City of Modesto
CANNABIS PROGRAM AND PERMIT REVIEW COMMITTEE
/ COUNCIL WORKSHOP
Room 2001-40 Del Puerto Room
Tenth Street Place, 1010 10th Street
Monday, June 12, 2023 at 2:00 PM
Roll Call: David Wright, Chair
Sue Zwahlen, Vice-Chair
Eric Alvarez, Member
Alternates: Nick Bavaro, Rosa Escutia-Braaton, Chris Ricci, Jeremiah Williams “Wordly” can translate into 25+ different languages! To access written translation during the meeting, please scan the QR Code or click this link https://attend.wordly.ai/join/RJDY-6364.
"Wordly" puede traducir a más de 25 idiomas diferentes! Para acceder a la traducción durante la reunión, por favor escanee el código QR o haga clic en el enlace https://attend.wordly.ai/join/RJDY-6364.
THIS MEETING WILL BE PHYSICALLY OPEN TO THE PUBLIC AND BY ZOOM
VIDEO CONFERENCING AND TELEPHONE
Effective March 1, 2023, if a technical issue arises with Zoom or the phone dial-in option, the Committee meeting will continue unless the meeting is being held pursuant to the provisions of Assembly Bill 2449. Alternative viewing options are listed below and the meeting is physically open to the public.
You may observe a livestream of the meeting at http://media.modestogov.com. You may also participate in the meeting as indicated below.
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PARTICIPATING IN CITY COUNCIL COMMITTEE MEETINGS
As a courtesy, the City of Modesto is providing alternatives to view Council Committee meetings and provide public comments. If you wish to make either a general public comment or to comment on a specific agenda item, you may use one of the following options:
SUBMITTING COMMENTS BY E-MAIL
Written comments may be submitted via email to: [email protected] (include Agenda Item Number in the subject line). All comments will be shared with the Committee Members and placed in the record, but will not be read aloud during the meeting. Written comments must be received two hours before the meeting.
VIRTUAL PARTICIPATION BY ZOOM VIDEO
CONFERENCING AND TELEPHONE
Joining the Committee meeting via Zoom
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Enter the following link into an Internet Browser
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To use Zoom, please visit: https://zoom.us/ and either sign-up for a free Zoom account or continue as a guest. Once you have downloaded the app onto your mobile device, joined from your web browser, or downloaded the Zoom software on your computer you will be ready for the upcoming Committee meeting.
Joining the Committee meeting via Telephone
If you don’t have a smart phone or computer to access the meeting via Zoom, you can participate by phone, by calling 1-877-853-5257 (Toll Free) or 1-888-475-4499 (Toll Free) and enter the Webinar ID 869 4597 0570 Passcode 84326
Providing Public Comment on Zoom and by Telephone
The Committee Chairman will request public comment during the Public Comment periods on the meeting agendas and during each Regular Calendar Item on the Committee Agenda. Once the Chairman has announced the public comment period, please do one of the following.
USING A COMPUTER OR SMART PHONE APP:
Click on the “Raise Hand” feature in the webinar controls. This will notify City staff that you have raised your hand.
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City staff will unmute your microphone when it is your turn to provide public comment.
A prompt will appear to confirm you would like to be unmuted and then you will have three minutes to provide public comment.
Once your public comment has ended, you will be muted again.
USING A REGULAR PHONE (not using a computer or smart phone APP):
Dial *9 (star 9), this will notify City staff that you have “raised your hand” for public comment.
City staff will unmute your microphone when it is your turn to provide public comment.
You will hear “you are unmuted” and then you will have three minutes to provide public comment.
Once your public comment has ended, you will be muted again. If your phone is unmuted, and you are unable to be heard, the host may ask that you Dial *6 to toggle mute on/off in Zoom.
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Please visit Zoom’s website support page on helpful tips to prepare for the meeting:
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Council has not delegated directive or final approval authority to the Committees. Committee actions are recommendations to the full City Council, not final decisions on an issue.
PUBLIC COMMENTS
Please refer to special public comment instructions above.
Three-minute time limit per speaker.
Only interested persons in the audience may present these matters. Under State law, Committee Members may respond to matters being presented under this item only as follows:
a. Briefly respond to statements made or questions raised. b. Ask a question for clarification.
c. Provide a reference to staff or other resources for factual information. d. Request staff to report back at a subsequent meeting. e. Finally, a Committee Member or the Committee itself may take action to direct staff to place a matter of business on a future agenda.
Any and all of the following agenda items are subject to action by the Modesto City Council.
This Agenda is on file in the City Clerk’s Office, Sixth Floor, 10th Street Place, Posting Board at entry of 10th Street Place, and is available on the City’s Web site at www.modestogov.com. - 3 -
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In accordance with the requirements of Title II of the Americans with Disabilities Act (“ADA”) of 1990, the Fair Employment & Housing Act (“FEHA”), the Rehabilitation Act of 1973 (as amended), Government Code section 11135 and other applicable codes, the City of Modesto (“City”) will not discriminate against individuals on the basis of disability in the City’s services, programs, or activities. For more information, please visit the City of Modesto website at https://www.modestogov.com/865/Americans-with-Disabilities-Act-ADA In compliance with the Americans with Disabilities Act, if you need special assistance to participate in this meeting, please contact the City Clerk (209) 577-5396. Notification 48 hours prior to the meeting will enable the City to make reasonable arrangements to ensure accessibility to this meeting.
HEARINGS
Continued from the May 22, 2023 meeting. Published in the Modesto Bee on May 12, 2023. 1 Hearing to consider approving a Commercial Cannabis Microbusiness Type 12 Permit for Fiji Weed Company, LLC, located at 1420 Granite Ln., with appropriate conditions. (Funding Source: Cannabis Business Permit Fees) Resolution approving a Commercial Microbusiness Type 12 Permit for Fiji Weed Company LLC, located at 1420 Granite Ln, with appropriate conditions.
CED; Sean Rando, 209-577-5473, [email protected]
NEW BUSINESS
2 Consider approving the renewal of eight Commercial Cannabis Retail Permits for dispensaries in the City for a further two-year period ending June 30, 2025; and approving a change in ownership policy for commercial cannabis permits within the City of Modesto, and approving changes in ownership for Jonesa, LLC and CV Wellness, LLC. (Funding Source: Cannabis Permit Fees)
Motion recommending the renewal of the eight Commercial Cannabis Retail Permits for dispensaries in the City for a further two-year period ending June 30, 2025 and forwarding to Council for approval.
Motion recommending the approval of a change in ownership policy for commercial cannabis permits within The City of Modesto and forwarding to Council for approval.
Motion recommending the approval of a change in ownership for Jonesa, LLC and forwarding to Council for approval.
Motion recommending the approval of a change in ownership for CV Wellness, LLC and forwarding to Council for approval.
CED; Jessica Hill, 209-577-5321, [email protected]
ADJOURNMENT
Posted pursuant to Government Code Section 54954.2 on the bulletin board at Tenth Street Place on at by
date time signature
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CITY OF MODESTO
COMMITTEE AGENDA REPORT
DATE OF MEETING:
June 12, 2023
Date: May 25, 2023
TO: Cannabis Program and Permit Review Committee
David Wright, Chair
Sue Zwahlen, Vice-Chair
Eric Alvarez, Member
THROUGH: Joseph P. Lopez, City Manager
FROM: Jessica Hill, Interim Director of Community and Economic Development SUBJECT: Commercial Cannabis Microbusiness Type 12 Permit application for Fiji Weed Company, LLC (1420 Granite Ln)
CONTACT: Sean M. Rando, Business Analyst,
[email protected], 209-577-5473
DESCRIPTION:
Hearing to consider approving a Commercial Cannabis Microbusiness Type 12 Permit for Fiji Weed Company, LLC, located at 1420 Granite Ln., with appropriate conditions. (Funding Source: Cannabis Business Permit Fees)
STRATEGIC PLAN ELEMENT:
This item is consistent with the City Council 2020-2025 Strategic Plan Goal E, Drive Economy Vitality.
BACKGROUND:
In December 2017, the City Council adopted Ordinance 3684-C.S. legalizing certain commercial cannabis business operations in particular zoning districts. On December 19, 2018, by Resolution 2018-566 the City Council approved and issued eight (8) dispensary permits, which were valid for a period two (2) years from that date. On December 19, 2020, by Resolution 2020-485-489, City Council approved initial renewal applications for the eight (8) retail locations.
Seven (7) non-dispensary cannabis businesses have been approved since that time during different years via various resolutions.
The City Council was the approving body regarding all cannabis businesses operating in the City at the onset of the permit program. On April 13, 2021, by Resolution No. 2021-132, Council established the Cannabis Permit Review Committee (Committee) and delegated the authority to approve non-dispensary and non-delivery cannabis businesses to that Committee. On March 1, 2022, by Resolution No. 2022-109, the Council expanded the role of the Committee to advise #1.
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Cannabis Program and Permit Review Committee, June 12, 2023 Commercial Cannabis Microbusiness Type 12 Permit application for Fiji Weed Company, LLC (1420 Granite Ln)
the Council on all cannabis-related issues and renamed the Committee, the Cannabis Program and Permit Review Committee.
All non-dispensary project application subject to a non-competitive review process consisting of the following steps:
Submission of forms related to applicant(s) information, proposed business location, property owner authorization, and a background check process. Submission of an application packet which includes applicant team information and company history, business plan, site and operating plans, security information and plans, odor control, waste disposal and financial information.
DISCUSSION:
Fiji Weed Company applied for a commercial cannabis microbusiness permit on February 24, 2020. The proposed commercial cannabis Type 12 microbusiness is to be located within suite B of an existing commercial warehouse located at 1420 Granite Ln. A Type 12 cannabis microbusiness is defined as a cultivation business of less than 10,000 square feet, which also acts as a licensed distributor and Type 6 (non-volatile) manufacturer.
All background checks and zoning requirements were met with the location being within a properly designated industrial zone. The nearest area of sensitive use is a residential neighborhood two-hundred and fifty (250) feet away from 1420 Granite Ln. Pursuant to Modesto Municipal Code Section 10-3.703(b)(2), no commercial cannabis use shall be located within one hundred (100) feet of any residential use. Staff cleared the applicant to move to the next step of their application which involves the submission of a business, security, safety, and environmental plan for the City to review. This packet was provided by Fiji Weed Company on December 21, 2022. All submissions were deemed complete on February 13, 2023.
The applicant’s business will be a new vertically integrated family-owned and operated craft cannabis company that will perform operations under a microbusiness license. They will specialize in cannabis cultivation, manufacturing, and distribution. The business will produce self-sufficient indoor cannabis which will use eco-friendly methods of producing minimal waste of natural resources.
City staff and the City’s current cannabis consultant reviewed the application materials and determined that the proposed Fiji Weed Company permit application conforms to the City’s cannabis ordinance. As a result of that review, two standard / typical conditions of approval were identified; these are described below.
The Cannabis Ordinance requires that City staff prepare conditions of approval in addition to the requirements of the Ordinance, based on the City’s review of the application. Based on review of the application, City staff recommends the following project-specific conditions of approval.
1. City staff, with assistance and representation by HdL Companies staff, will be authorized to access the business site / location before, during and after construction of tenant improvements and business operations to inspect and document various components of #1.
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Cannabis Program and Permit Review Committee, June 12, 2023 Commercial Cannabis Microbusiness Type 12 Permit application for Fiji Weed Company, LLC (1420 Granite Ln)
business operations, security systems, inventory access and control procedures, and/or any other points of concern.
2. Fiji Weed Company LLC is required to submit a completed City of Modesto Wastewater Discharge Permit Application form within 30 days of beginning business operations. City staff will conduct ongoing inspections as needed to verify wastewater discharge from the business. Fiji Weed Company LLC representatives will fully cooperate with City’s inspections and inquiries.
On May 22, 2023, City staff received a public comment letter which was provided to the members of the Cannabis Program and Permit Review Committee. This letter informed the City of potential unpermitted commercial cannabis activities taking place at the proposed location for Fiji Weed Company, LLC. In order to provide additional time for staff to follow up on this information a motion was passed to continue the consideration of this commercial cannabis microbusinesses permit application to a June 12, 2023 Committee meeting.
On May 25, 2023, The applicant provided City Staff with access to the property to investigate the previously mentioned claims. No evidence of any active or prior commercial cannabis activity was found. The building only contained equipment (lighting systems, air circulators, partitioning walls) in preparation for the necessary tenant improvements upon the approval of their permit application.
FISCAL IMPACT:
The anticipated ongoing administrative and oversight costs will be offset with the annual commercial cannabis permit fee which is currently $18,732. The business will also be subject to the City’s cannabis excise tax of 4% for microbusinesses.
CEQA/NEPA REQUIREMENTS:
The proposed commercial microbusiness Type 12 business permit application is exempt from the California Environmental Quality Act under the existing facilities exemption in Regulation 15301. The proposed project is permitted under the current zoning code.
RECOMMENDED COMMITTEE ACTION:
STAFF RECOMMENDATION:
Resolution approving a Commercial Microbusiness Type 12 Permit for Fiji Weed Company LLC, located at 1420 Granite Ln, with appropriate conditions.
Approved by:
Jessica Hill,
Interim Director of Community and Economic
Development
Joseph P. Lopez, City Manager
Attachments:
1. Resolution
2. Vicinity Map
3. Public Comments Received
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05/22/2023/CED/SRando/Item-XX 1 2023-XX
CITY OF MODESTO
CANNABIS PROGRAM AND PERMIT REVIEW COMMITTEE
RESOLUTION NO. -2023
RESOLUTION APPROVING A COMMERCIAL MICROBUSINESS TYPE 12 PERMIT FOR FIJI WEED COMPANY LLC, LOCATED AT 1420 GRANITE LN,
WITH APPROPRIATE CONDITIONS
WHEREAS, the City Council has adopted a Commercial Cannabis Ordinance, Ordinance 3684-C.S., that established the City’s regulatory framework for commercial cannabis uses; and
WHEREAS, the Ordinance establishes certain standards and criteria that apply to all potential commercial cannabis businesses; and
WHEREAS, on April 13, 2021 the City Council by Resolution No. 2021-132 established the Cannabis Permit Review Committee for the purpose of reviewing and approving commercial non-retail and non-delivery cannabis businesses; and WHEREAS, on March 1, 2022, the Council by Resolution No. 2022-109 expanded the role of the Cannabis Permit Review Committee to advise the Council on all cannabis-related matters and renamed the Committee to the Cannabis Program and Permit Review Committee; and
WHEREAS, Fiji Weed Company LLC has applied for a Type 12 Microbusiness permit to include cultivation, non-volatile manufacturing and distribution located at 1420 Granite Lane; and
WHEREAS, the application has been reviewed by City staff and the City’s current cannabis consultant, HdL, and has been determined to be in compliance with the City’s cannabis ordinance and applicable State law; and #1.
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05/22/2023/CED/SRando/Item-XX 2 2023-XX
WHEREAS, the Cannabis Program and Permit Review Committee held a properly noticed public hearing to consider the Fiji Weed Company LLC’s Type 12 Microbusiness permit application on May 22, 2023; and
WHEREAS, a motion was passed to continue the consideration of the applicant’s commercial cannabis microbusiness permit to a June 12, 2023 meeting date of the Cannabis Program and Permit Review Committee; and
WHEREAS, the City Council desires to issue commercial cannabis business permits to qualified operators at permitted locations that comply with state and local laws and regulations, enhance the diversity of the City’s economy, mitigate negative impacts, provide a variety of locations and types of cannabis businesses to the community, and best promote the public health, safety, and general welfare of Modesto residents and businesses; and
WHEREAS, the permit is exempt from CEQA under Section 15301 of the CEQA Guidelines, which exempts the reuse of existing facilities.
NOW, THEREFORE, BE IT RESOLVED by the City of Modesto Cannabis Program and Permit Review Committee, that it herby approves a Commercial Cannabis Type 12 Microbusiness Permit for Fiji Weed Company LLC, located at 1420 Granite Lane, subject to the following conditions:
1. City staff, with assistance and representation by HdL Companies staff, will be authorized to access the business site / location before, during and after construction of tenant improvements and business operations to inspect and document various components of business operations, security systems, inventory access and control procedures, and/or any other points of concern.
2. Fiji Weed Company LLC is required to submit a completed City of Modesto Wastewater Discharge Permit Application form within 30 days of beginning business operations. City staff will conduct ongoing inspections as needed to verify #1.
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05/22/2023/CED/SRando/Item-XX 3 2023-XX
wastewater discharge from the business. Fiji Weed Company LLC representatives will fully cooperate with City’s inspections and inquiries.
The foregoing resolution was introduced at a regular meeting of the Cannabis Program and Permit Review Committee held on the 12th day of June, 2023 by Committee Member , who moved its adoption, which motion being duly seconded by Chair , was upon roll call carried and the resolution adopted by the following vote:
AYES: Committee Members:
NOES: Committee Members:
ABSENT: Committee Members:
ATTEST: _____________________________
DAVID WRIGHT, Chair
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N CARPENTER RD
GRANITE LN
SHADDOX AVE
MC WILLIAMS WY
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1413 1405 1331
1420 1416 1412
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O
NDP-20-001 EXH Cannabis Location - Proximity Map 3-24-20.mxd 3-15-23
1 inch = 125 feet
2022 Aerial Data
NDP-20-001
1420 Granite Ln
APN 029-050-015
Distance to Nearest Residence:
250'
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1401 McWilliams Way
Modesto, CA 95351
Phone: (209) 572-7390
May 16, 2023
Mr. Sean Rando
Community and Economic Development Department
City of Modesto
1010 Tenth St.
Modesto, CA 95354
RE: Application for Fiji Weed Company at 1420 Granite Lane, Modesto, CA
FOR PUBLIC COMMENT
We own the properties at 1401 McWilliams Way and 1341 McWilliams Way, Modesto.
Both of these properties are within less than a quarter mile of the proposed cannabis facility.
This area is successfully operating as home for many manufacturing, utility and serviceoriented businesses.
PG&E and AT&T both have facilities in the near proximity to 1420 Granite and both companies could be negatively influenced from the clientele of a cannabis facility. The AT&T yard in particular has suffered a lot of criminal theft and vehicle damage from theft through the recent years.
This location is not appropriate for a facility of this type, and it should be located in an area that does not include a place of worship and a religious school like the Islamic Center of Modesto at 1445 N. Carpenter Road.
Thank You,
Jeff Grover
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CITY OF MODESTO
COMMITTEE AGENDA REPORT
DATE OF MEETING:
June 12, 2023
Date: May 24, 2023
TO: Cannabis Program and Permit Review Committee
David Wright, Chair
Sue Zwahlen, Vice-Chair
Eric Alvarez, Member
THROUGH: Joseph P. Lopez, City Manager
FROM: Jessica Hill, Interim Director of Community and Economic Development SUBJECT: Retail Commercial Cannabis Permit Renewals and Changes in Ownership CONTACT: Jessica Hill, Interim Director of Community and Economic Development [email protected], 209-577-5321
DESCRIPTION:
Consider approving the renewal of eight (8) Commercial Cannabis Retail Permits for dispensaries in the City for a further two-year period ending June 30, 2025; and approving a change in ownership policy for commercial cannabis permits within the City of Modesto, and approving changes in ownership for Jonesa, LLC and CV Wellness, LLC. (Funding Source:
Cannabis Permit Fees)
STRATEGIC PLAN ELEMENT:
This item is consistent with the City Council 2020-2025 Strategic Plan Goal E, Drive Economy Vitality.
BACKGROUND:
In December 2017, the City Council adopted Ordinance 3684-C.S. legalizing certain commercial cannabis business operations in particular zoning districts. On December 19, 2018, by Resolution 2018-566 the City Council approved and issued eight (8) cannabis retail permits, which were valid for a period two (2) years from that date. On December 19, 2020, by Resolution 2020-485-489, City Council approved the initial renewal applications for the eight (8) retail locations. This renewal period was set to expire on December 19, 2022.
On November 1, 2022, by Resolution No. 2022-442, Council approved the extension of the eight (8) issued commercial cannabis retail permits from December 19, 2022 to June 30, 2023 and adjusted the two-year renewal period from a calendar year to a fiscal year which runs from July to June.
The City Council was the approving body regarding all cannabis businesses operating in the City. On April 13, 2021, by Resolution No. 2021-132, Council established the Cannabis Permit #2.
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Cannabis Program and Permit Review Committee, June 12, 2023 Retail Commercial Cannabis Permit Renewals and Changes in Ownership
Review Committee (Committee) and delegated the authority to approve non-dispensary and non-delivery cannabis businesses to that Committee. On March 1, 2022, by Resolution No. 2022-109, the Council expanded the role of the Committee to advise the Council on all cannabis-related issues and renamed the Committee, the Cannabis Program and Permit Review Committee.
DISCUSSION:
Permit Renewal
An updated permit renewal package was forwarded to the cannabis retail businesses, via certified and electronic mail, on April 17, 2023. The primary purpose of this renewal is to update the City’s records with the following documents:
1. A completed commercial cannabis business permit renewal application.
2. A signed copy of an updated conditions of approval and community benefit contribution agreement.
3. Proof of license with the California Department of Cannabis Control (DCC), and a copy of the most recent application with the DCC.
4. Proof of an updated lease or other documentation showing that the real property where the business is located will be secured through the permit period covered by the renewal.
5. Proof of community benefit fulfillment which included:
a. Nonprofit donation letters
b. Good Neighbor program declarations signed by neighboring property owners c. Letters signed by nonprofit organizations showing the establishment of volunteer programs used to educate the community on the cannabis industry in addition to providing courses detailing the negative effects that early age drug use can have.
6. A current list of employees
7. Proof of current general liability insurance.
8. Proof of zero (0) balance due to the City for cannabis permit fees, excise, and sales taxes.
9. A breakdown of current ownership
Each dispensary is inspected by the City’s Cannabis consultant on an annual basis. On-site compliance inspections are conducted to ensure businesses are operating in compliance with Modesto’s Commercial Cannabis Ordinance in addition to compliance with State law.
Additionally, the City conducts annual financial audits to ensure the cannabis business taxes that each dispensary reports and remits to the City follows the Modesto Municipal Code and are accurate.
Based on the City’s inspections and audits1, the dispensaries were operating in compliance with City code and state law. Inspections and financial exams have revealed minor areas that can be addressed, including submittal of updated floor plans, repositioning of a camera, or making a modification to the Point-of-Sale System (POS). All minor concerns were addressed and in compliance. This year’s inspections and audits will occur during July 2023. 1 Inspections for the permit period being renewed this year occurred in July of 2022. #2.
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Cannabis Program and Permit Review Committee, June 12, 2023 Retail Commercial Cannabis Permit Renewals and Changes in Ownership
City Staff reviewed the applications returned by each business for completeness and found each dispensary to be in compliance.
Changes in ownership
Pursuant to Modesto Municipal Code, 10-3.704(d), permits issued in accordance with the City’s Cannabis ordinance are not transferable to another individual without City approval.
During this renewal period, City Staff confirmed the ownership composition of each of the dispensaries. Prior to this time a set of policies and procedures had not been in place to address any potential changes. Through the renewal process, four (4) dispensaries have had ownership changes since the original approval of retail dispensaries in 2018.
Staff drafted a policy to align with the State requirements and documentation that the City may request from the businesses seeking an ownership change. The levels of approval will be based on the following criteria:
New owner acquires 51% of the business- City Council approval for dispensaries and Committee approval for non-dispensaries
Original owner relinquishes their entire ownership interest, and a new owner or owners are brought on board- City Council approval for dispensaries and Committee approval for nondispensaries All other transfers will require City Manager Approval An original owner(s) must retain a minimum of 20% ownership interest in the businesses to continue operating under their current commercial cannabis permit following City approval of the change, otherwise the business must cease operation and reapply for a commercial cannabis permit under the new business structure This new policy is consistent with California Department of Cannabis Control (DCC) regulations regarding ownership changes. Section 150232 of DCC regulations allows for changes with certain conditions:
The business may continue to operate under the active license if at least one existing owner is not transferring their ownership interest and will remain as an owner under the new ownership structure
A change in ownership does not occur when one or more owners leave the business by transferring their ownership interest to the other existing owner(s) Documents detailing the permit transfers that may be requested at the discretion of the City will include: proof of filing with the Secretary of State, Bylaws, Operating Agreements, Partnership Agreements, Corporate Meeting Minutes, Completion of background check for new owners as required by Modesto City Code section 10-3.704(3)(2), and signed declaration by the relinquishing party acknowledging the change.
The permit transfers that occurred following the City Council’s approval in 2018 were:
Jonesa, LLC (Cookies)
o A new owner acquired greater than a 50% stake- City Council approval CV Wellness, LLC (Authentic 209)
2 Department of Cannabis Control Medicinal and Adult-Use Commercial Cannabis Regulations California Code of Regulations Title 4 Division 19. Department of Cannabis Control- https://www.cannabis.ca.gov/wp-content/uploads/sites/2/2022/11/dcc_current-fulltext_2022-1107.pdf #2.
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Cannabis Program and Permit Review Committee, June 12, 2023 Retail Commercial Cannabis Permit Renewals and Changes in Ownership
o A new owner acquired greater than a 50% stake- City Council approval DC Modesto, LLC (Levels)
o A new owner acquired less than a 51% stake and an original owner remains-City Manager Approval
CR&D, Inc. (Modesto Cannabis Collective)
o New owners acquired less than a 51% stake in the company and the original owners remain-City Manager Approval
Because of the ownership changes with Jonesa, LLC (Cookies), and CV Wellness, LLC (Authentic 209), this will require Council approval.
FISCAL IMPACT:
The annual permit fee is currently set at $18,732, which covers costs related to the administration and monitoring of the permitted cannabis businesses. Total annual permit fee revenue equates to $149,856 with eight (8) operating commercial cannabis retail businesses.
Pursuant to Modesto Municipal Code, 8-2.1108(A), cannabis excise tax rates may be set at a maximum rate of 10% through a Council Resolution. On December 4, 2018, by Resolution No. 2018-537, Council adopted the previously approved cannabis business tax rates. On June 8, 2021, by Resolution No. 2021-211, Council amended the cannabis excise tax rates with the percentage for cannabis retail businesses being set at 8% of gross receipts.
RECOMMENDED COMMITTEE ACTION:
Staff Recommendations:
Motion recommending the renewal of the eight (8) Commercial Cannabis Retail Permits for dispensaries in the City for a further two-year period ending June 30, 2025 and forwarding to Council for approval.
Motion recommending the approval of a change in ownership policy for commercial cannabis permits within The City of Modesto and forwarding to Council for approval.
Motion recommending the approval of a change in ownership for Jonesa, LLC and forwarding to Council for approval.
Motion recommending the approval of a change in ownership for CV Wellness, LLC and forwarding to Council for approval.
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Cannabis Program and Permit Review Committee, June 12, 2023 Retail Commercial Cannabis Permit Renewals and Changes in Ownership
Approved by:
Jessica Hill,
Interim Director of Community and Economic
Development
Joseph P. Lopez, City Manager
Attachments:
1. Commercial Cannabis Ownership Confirmation Form
2. Commercial Cannabis Renewal Checklist
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Commercial Cannabis Ownership Confirmation Form
Instructions: Please provide a list of all business owners and their percentages of ownership.
Please note that failure to inform the City of permit transfers to another individual may be grounds for permit revocation pursuant to MMC:10-3.705
Owner Name Ownership
Percentage
Have
there
been any
changes?
Y/N
Explanation of the Change (if any):
COMMUNITY AND ECONOMIC
DEVELOPMENT-CANNABIS PERMIT
PROGRAM
1010 Tenth Street, Suite 3300, P.O. Box
642 Modesto, California 95354
209.571.5157
[email protected]
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Completed applications must be submitted to:
Community and Economic Development
Department
1010 Tenth Street, Suite 3300, P.O. Box 642
Modesto, CA 95353
Telephone (209) 577-5267
I certify under penalty of perjury under the laws of the State of California, that the information contained herein is true and correct.
Supplementary Information:
Approval requirements necessary for change of ownership requests pursuant to MMC:10-
3.704(d) are as follows:
A. Any change affecting any ownership interest of a Cannabis Business, including, but not limited to, any change in ownership that affects an aggregate ownership interest of less than 20% of the Cannabis Business, must be promptly disclosed, in writing, to the City within 30 days of the intent to initiate a change.
B. A change in ownership does not occur when one or more owners leave the business by transferring their ownership interest to the other existing owner(s).
C. Any change affecting any ownership interest of a Cannabis Business that results in a Person holding ownership interest of a Cannabis Business, when that Person did not previously hold an ownership interest in the Cannabis Business shall require the Permittee to promptly obtain approval from the appropriate City representative:
a. A Person who now holds an aggregate ownership interest of 51% of a Cannabis Business when they previously had not will require City Council approval for Dispensaries or approval by the Cannabis Program and Permit Review Committee for non-dispensaries
b. If a Person who previously held ownership interests of a Cannabis Business no longer holds an interest in the business, whether as a result of a single transaction or multiple over time, will require City Council approval for Print Name: Title:
Signature: Date:
#2.
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Completed applications must be submitted to:
Community and Economic Development
Department
1010 Tenth Street, Suite 3300, P.O. Box 642
Modesto, CA 95353
Telephone (209) 577-5267
Dispensaries or approval by the Cannabis Program and Permit Review Committee for non-dispensaries if a new owner or owners take their place. i. If originally approved owners retain 100% of the interest in the Cannabis Business amongst them then this transaction would require approval by the City Manager or their designee
c. All other transfers will require the approval of the City Manager or their designee D. Any transfers that would lower an equity owner’s interest below the required 51% are disallowed and may be grounds for permit revocation and/or loss of equity status E. Documents that may be requested at the discretion of the City include but are not limited to:
a. Proof of filing with the Secretary of State (with new ownership listed) b. Bylaws, Executed Operating Agreement, Partnership Agreement (documenting the change)
c. Corporate Meeting Minutes (documenting the change), if applicable d. Completion of background check for new owners as required by Modesto City Code section 10-3.704(3)(2), if applicable
e. Signed declaration by the relinquishing party acknowledging the change #2.
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Business Name Permit Number Permit Expiration date
Completed Renewal
Application received
Received Signed
Conditions of
Approval
Proof of Valid lease,
or other method of
secured property
Proof of Community
Benefit Fulfillment
Current list of employees with
addresses
Proof of current
insurance
Proof of Zero
Balance due to
the City (finance
provided)
Cannabis
Ownership
Confirmation
Form
PHENOS COLLECTIVE, INC DIS-18-009 6/30/2023 √ √ √ √ √ √ √ √ THE PEOPLES REMEDY DIS-18-019 6/30/2023 √ √ √ √ √ √ √ √ LEVELS (DC Modesto, LLC) DIS-18-014 6/30/2023 √ √ √ √ √ √ √ √ C R AND D INC (Modesto Cannabis Collective) DIS-18-008 6/30/2023 √ √ √ √ √ √ √ √ AUTHENTIC 209 (CV Wellness) DIS-18-004 6/30/2023 √ √ √ √ √ √ √ √ COOKIES (Jonesa LLC) DIS-18-015 6/30/2023 √ √ √ √ √ √ √ √ MEDALLION WELLNESS DIS-18-007 6/30/2023 √ √ √ √ √ √ √ √ PLANET 8THS DIS-18-018 6/30/2023 √ √ √ √ √ √ √ √
#2.
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Business Name Permit Number Permit Expiration date
PHENOS COLLECTIVE, INC DIS-18-009 6/30/2023
THE PEOPLES REMEDY DIS-18-019 6/30/2023
LEVELS (DC Modesto, LLC) DIS-18-014 6/30/2023
C R AND D INC (Modesto Cannabis Collective) DIS-18-008 6/30/2023 AUTHENTIC 209 (CV Wellness) DIS-18-004 6/30/2023
COOKIES (Jonesa LLC) DIS-18-015 6/30/2023
MEDALLION WELLNESS DIS-18-007 6/30/2023
PLANET 8THS DIS-18-018 6/30/2023
Licensed
w/State State license number
Application
Sent via
certified mail
and email
Second
Request
via email
Third
Request
Via email
Fourth
Request
via email
Phone Call
Dates
Contacting
the
businesses
in Person
Application
package
received and
reviewed
Certified mail
signature receipt
date
Yes C10-0000197-LIC 4/17/2023 N/A N/A 4/21/2023 4/19/2023 Yes C10-0000403-LIC 4/17/2023 4/25/2023 5/3/2023 5/15/2023 5/8/2023
5/12/2023
5/15/2023 5/15/2023 5/16/2023 4/19/2023
Yes C10-0001211-LIC 4/17/2023 4/25/2023 N/A 5/15/2023 5/15/2023 4/28/2023 4/19/2023 Yes C10-0000163-LIC 4/17/2023 4/25/2023 5/3/2023 5/9/2023 4/22/2023 Yes C10-0000448-LIC 4/17/2023 4/25/2023 N/A 4/28/2023
Yes C10-0000638-LIC 4/17/2023 4/25/2023 N/A 5/15/2023 5/15/2023 4/28/2023 4/19/2023 Yes C10-0000674-LIC 4/17/2023 4/25/2023 N/A 4/28/2023 4/19/2023 Yes C10-0000155-LIC 4/17/2023 4/25/2023 5/3/2023 5/15/2023 5/8/2023
5/12/2023
5/15/2023 5/15/2023 5/16/2023 4/19/2023
#2.
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Business Name Permit Number Permit Expiration date
PHENOS COLLECTIVE, INC DIS-18-009 6/30/2023
THE PEOPLES REMEDY DIS-18-019 6/30/2023
LEVELS (DC Modesto, LLC) DIS-18-014 6/30/2023
C R AND D INC (Modesto Cannabis Collective) DIS-18-008 6/30/2023 AUTHENTIC 209 (CV Wellness) DIS-18-004 6/30/2023
COOKIES (Jonesa LLC) DIS-18-015 6/30/2023
MEDALLION WELLNESS DIS-18-007 6/30/2023
PLANET 8THS DIS-18-018 6/30/2023
Community Benefit Fulfillment
Phenos 2022 Events/ Community Engagement
Year:2022
Location: Phenos
Jan 28th - First Yoga Of the Year/ Brand Spotlight
March 25th Yoga & Edibles Course
April 15th General Cannabis Knowledge & Yoga Flow
Mav 27th - Intro Yoga Practice
July 10th / Concentrate & Yoga Course
July 30th Phenos 1st Annual Basketball Tournament
Sept: 10th
Fit Boot Camp/ Health & Wellness Course- Guest Coach Ash Maddison November 11th Friendly Farms
Glow Flow Yoga- basic yoga practice and the benefits of Cannabis December 23rd Puff Pre Roll Takeover
Financial support for the Stanislaus SWAT Association
Majority Modesto area employees
For the community benefit contribution portion, I downloaded a report from our point of sale showing all of the product that each store has donated to medical patients. Each store works with Weed For Warriors a nonprofit organization that helps veterans get access to free medicinal cannabis.
The report from the POS will show the value and quantity of items donated, I tried to save it to where those were on top but I am not sure if it did save in that manner.
Majority Modesto area employees
Nonprofit Donations
Letter confirming the creation of a Good Neighbor Program, volunteering 100-150 hours a year for cleanup and other services in proximity to the dispensary
Letter stating that DC Modesto volunteers with the Boys and Girls Club to provide education and community outreach Majority Modesto area employees
Adopt a Highway program
Donations to West Modesto Neighborhood Association
Boys and girls club clothing to the Salvation Army
Hiring a majority of staff from the Modesto Area
Education programs at Latino round table red event room Provided education at graffiti car shows, taco fest, 209 beat down, Modesto Car show, and other events through the City Twice-daily trash cleanups
Majority Modesto area employees
Works with the Stanislaus Community Foundation to provide support to local nonprofits Majority Modesto area employees
Donated to local nonprofits
Majority Modesto area employees
Donations
Neighborhood cleanup
Open house policy for community outreach and education
Majority Modesto area employees
For the community benefit contribution portion, I downloaded a report from our point of sale showing all of the product that each store has donated to medical patients. Each store works with Weed For Warriors a nonprofit organization that helps veterans get access to free medicinal cannabis.
The report from the POS will show the value and quantity of items donated, I tried to save it to where those were on top but I am not sure if it did save in that manner.
Majority Modesto area employees
#2.
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