City of Paso Robles – City Council Comments 805-865-7276 1 Cannabis
Non-Storefront Retail and
Cannabis Regulatory Permit
RZN25-08 / SPA 26-03 / P25-0077
August 18, 2026
City of Paso Robles – City Council Comments 805-865-7276 2 Public Comments call 805-865-7276
▪ 2016 – Prop 64 legalized “adult use of marijuana” (personal use legalized statewide; commercial use as allowed by zoning) ▪ 2016 – Paso Robles Ordinance 1036 (medicinal delivery offices = only commercial activity allowed) ▪ 2017 – California Medicinal and Adult Use Cannabis Regulations and Safety Act (MAUCRSA) (delivery of adult-use cannabis legal statewide)
▪ 2018 – Paso Robles Measure I-18 (maximum cannabis tax rates established) ▪ 2019 – Paso Robles Ordinances 1072 and 1073 (medicinal delivery offices by CUP) ▪ 2020 – Paso Robles Ordinance 1104 (setting cannabis business tax rates) ▪ 2022 – Paso Robles Ordinance 1126 and Resolution 22-144 (temporarily allowed 3 adult-use non-storefront retailers) ▪ 2026 –
o February 10 – Planning Commission recommended amendments to PRMC Chapter 21.60 (to allow adult-use nonstorefront retail) o May 19 – City Council Study Session (4 clarifying questions) o July 14 – Planning Commission recommended revised amendments (allow adult-use non-storefront retail and to require a Cannabis Regulatory Permit)
Cannabis Regulation
City of Paso Robles – City Council Comments 805-865-7276 3 Public Comments call 805-865-7276
“Adult-use cannabis” means cannabis or cannabis products intended for adults who are 21 years of age and older and who do not possess a physician’s recommendation, as defined in California Business and Professions Code Section 26001.
AKA commercial cannabis, recreational cannabis
“Non-storefront retail” or “non-storefront retailer” means a cannabis business that is closed to public access and conducts sales exclusively by delivery as defined in California Business and Professions Code Section 26070(a)(2), and requires a Type 9 (Non-Storefront Retailer) license (or successor license type) from the California Department of Cannabis Control.
AKA delivery office, delivery business
“Business License Tax Certificate” means the document issued as evidence of payment of a business license tax or exemption from payment as provided in this chapter.
AKA business license
Definitions
City of Paso Robles – City Council Comments 805-865-7276 4 Public Comments call 805-865-7276
Riverside Corridor (RSC) and Commercial/Light Industrial (C3) zoning districts City of Paso Robles – City Council Comments 805-865-7276 5 Public Comments call 805-865-7276
▪ Require Conditional Use Permit for nonstorefront retail (both medicinal and adult-use cannabis allowed)
▪ Prohibit all other commercial cannabis
activities (storefront retail, cultivation,
manufacturing, testing, distribution, etc.)
▪ Eliminate the proposed numerical cap on the
number of non-storefront retailers
▪ Limit onsite signage
▪ Extend the 600-foot separation requirement to
City and other public parks
Zoning Amendments – PRMC Chapter 21.60
City of Paso Robles – City Council Comments 805-865-7276 6 Public Comments call 805-865-7276
1. Conditional Use Permit
2. Cannabis Regulatory Permit
3. Business License
Cannabis Regulatory Framework
City of Paso Robles – City Council Comments 805-865-7276 7 Public Comments call 805-865-7276
– Land use entitlement (zoning compatibility, buffers from sensitive sites, odor control, traffic, noise, etc.)
– Site specific (runs with the land, not the operator)
– One-time approval
– Time-consuming to revoke
– Leaves a gap in oversight
1. Conditional Use Permit
City of Paso Robles – City Council Comments 805-865-7276 8 Public Comments call 805-865-7276
Proposed Chapter 5.55
Specific to an operator/business entity
Ongoing, proactive monitoring and regulatory oversight (annual renewal)
Operational standards (security plan, background checks, recordkeeping, etc.) Simpler revocation process
Best practice for cities in SLO County that allow cannabis businesses
2. Cannabis Regulatory Permit
City of Paso Robles – City Council Comments 805-865-7276 9 Public Comments call 805-865-7276
– Not regulatory
– Payment of business license taxes
– Payment of cannabis business taxes
3. Business License Tax Certificate
City of Paso Robles – City Council Comments 805-865-7276 10 Public Comments call 805-865-7276
– Disclosure of all parties with a 20% financial interest – Background checks on all applicants and employees
– List of DCC cannabis license type(s)
– Hours of operation
– Security plan
– Delivery operation plan
– Employee training plan
Application Requirements
City of Paso Robles – City Council Comments 805-865-7276 11 Public Comments call 805-865-7276
▪ Review of security plan, robbery response, cash handling, employee training, and vehicle security
▪ New background checks on permittees and employees
▪ Audit of ownership
▪ State license check
▪ Audit of inventory tracking
▪ Physical inspection of premises by Police Department
▪ Exterior inspection by Planning Division
Annual Renewal
City of Paso Robles – City Council Comments 805-865-7276 12 Public Comments call 805-865-7276
Operational Requirements
Keep a register of owners and employees and
notify the City of changes within 10 days
Keep legible, clear, and accurate books,
records, and documentation
Provide 24-hour contact information
Notify the City of any DCC inspection or
disciplinary action
Notify Police Department within 24 hours of
any criminal activity
Provide the City access to books within 24
hours of request.
No customers on the premises
Information from GPS tracker in all delivery
vehicles retained for 90 days
Properly store cannabis products
Require customer pre-registration and drivers
to carry delivery manifest
Provide adequate lighting on the cannabis
business premises
Drivers to wear visible company-issued ID
City of Paso Robles – City Council Comments 805-865-7276 13 Public Comments call 805-865-7276
▪ Business License Tax Certificate
▪ Payment of Cannabis Business Taxes
▪ State Licensing
▪ Hours of Delivery (8am and 10pm)
▪ Customer Pre-Registration and Delivery Manifest
▪ No Signage on Delivery Vehicles
▪ Delivery Driver Must Wear Company-Issued ID
▪ GPS Tracking
Operating Standards Applicable to Cannabis
Deliveries Originating from Outside Paso Robles
$
City of Paso Robles – City Council Comments 805-865-7276 14 Public Comments call 805-865-7276
▪ Option A (staff recommendation)
– Hybrid service delivery model combining administration with specialized consultant support.
▪ Option B
– Fully in-house administration by City staff.
▪ Option C (not feasible)
– Fully outsourced administration.
Program Administration / Proposed Fees
Proposed fees for each service delivery target 100% cost recovery City of Paso Robles – City Council Comments 805-865-7276 15 Public Comments call 805-865-7276
Option A
(Staff Recommendation)
Option A Service Delivery Responsibilities and Proposed Fees Function City Staff Consultant
INITIAL APPLICATION
Application Intake and Administration X
Application Review X X
Background Checks* X
Site and Security Plan Evaluation X
Pre-Permit Site Inspection X X
Permit Issuance X
ANNUAL RENEWAL APPLICATION
Renewal Application Intake and Administration X
Renewal Application Review X X
Renewal Background Checks* X
Annual Compliance Inspection X X
Renewal Issuance X
ADDITIONAL FUNCTIONS
Triennial Financial Audit X
OPTION A - PROPOSED FEES
Initial Application $5,500.00
Annual Renewal $4,600.00
Triennial Financial Audit $11,000.00
Consistent customer
service experience.
Maintain local oversight
and authority of
permitting decisions.
Consultant to
supplement City staff
with technical and
industry expertise.
Lower program costs.
City of Paso Robles – City Council Comments 805-865-7276 16 Public Comments call 805-865-7276
Option B
Option B Service Delivery Responsibilities and Proposed Fees Function City Staff Consultant
INITIAL APPLICATION
Application Intake and Administration X
Application Review X
Background Checks* X
Site and Security Plan Evaluation X
Pre-Permit Site Inspection X
Permit Issuance X
ANNUAL RENEWAL APPLICATION
Renewal Application Intake and Administration X
Renewal Application Review X
Renewal Background Checks* X
Annual Compliance Inspection X
Renewal Issuance X
ADDITIONAL FUNCTIONS
Triennial Financial Audit X
OPTION B - PROPOSED FEES
Initial Application $7,900.00
Annual Renewal $6,700.00
Triennial Financial Audit $12,000.00
Complete internal control
of administrative and
technical functions.
Maintain local oversight
and authority of
permitting decisions.
Dedicated staff with
specialized cannabis
regulatory expertise (ongoing training).
Higher program costs.
City of Paso Robles – City Council Comments 805-865-7276 17 Public Comments call 805-865-7276
Option C
▪ Fully outsourced administration - not feasible
City involvement required
▪ Statutory permitting and regulatory authority
▪ Interdepartmental coordination
▪ Review, approval, and permit issuance
▪ Inspections and ongoing oversight
▪ Enforcement of local regulations
▪ Public accountability
▪ Final permitting decisions
(Not Feasible)
City of Paso Robles – City Council Comments 805-865-7276 18 Public Comments call 805-865-7276
Proposed Fee Comparison
Jurisdiction Permit Type Application Fee Renewal Fee Additional Fees City of San Luis Obispo Application Fee $ 27,514.08
Annual License Fee $ 54,133.47
City of Morro Bay Commercial Cannabis Operating Permit $ 11,458.00 Commercial Cannabis Operating Permit- Annual
Renewal $ 6,712.00
City of Grover Beach Annual Regulatory Fee- Distribution $ 10,000.00 $ 10,000.00 Annual Audit Fee Per Business $ 10,000.00
Cannabis Background Fee - Owner $ 781.00
Cannabis Background Fee - Employee $452.00
City of Paso Robles -
Option A Initial Application $ 5,500.00
Annual Renewal $ 4,600.00
Triennial Financial Audit $ 11,000.00
City of Paso Robles – City Council Comments 805-865-7276 19 Public Comments call 805-865-7276
▪ Additional Fees to be considered
▪ Existing Services / Fees
Additional and Existing Fees
Function Proposed Fee
Appeals and
Revocation Actual Time and Materials
Permit Transfer
Request Same as Initial Application Fee
Frequency Function Estimated Costs
One-Time* Conditional Use Permit $2,645.00-$5,275.00
AS Needed Building Permit See BLDG Permit Fees
Annual Business License Tax Certificate
Based on Gross Receipts/Flat Fee $80.00-NoFixed
Place of Business
Quarterly Cannabis Business Tax Collection Based on Gross Receipts- Quarterly Reporting As Needed Livescan Fingerprint Service $50.00
City of Paso Robles – City Council Comments 805-865-7276 20 Public Comments call 805-865-7276
▪ Regulatory Permit Fees: Full cost recovery
▪ New Business Attraction: Potential additional revenue ▪ Cannabis Business Tax: Potential increase in tax revenue ▪ Overall Goal: Cost/Revenue neutrality
Historical CBT Revenues:
Financial Impacts / Cost Recovery
City of Paso Robles – City Council Comments 805-865-7276 21 Public Comments call 805-865-7276
The proposed ordinance is not subject to the California Environmental Quality Act (CEQA) because it does not qualify as a “project” under CEQA. State CEQA Guidelines §15060(c) provides that “[a]n activity is not subject to CEQA if … the activity is not a project as defined in Section 15378.” Here, the proposed ordinance does not qualify as a “project” because:
1. A “project” is an activity that “has a potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment.”
2. A “project” excludes “organizational or administrative activities of governments that will not result in direct or indirect physical changes in the environment.”
CEQA
City of Paso Robles – City Council Comments 805-865-7276 22 Public Comments call 805-865-7276
1. Take no action.
2. Allow non-storefront retail of both adult-use and medicinal cannabis with annual renewal of a Cannabis Regulatory Permit.
3. Provide alternative direction to staff.
Options
City of Paso Robles – City Council Comments 805-865-7276 23 Public Comments call 805-865-7276
Allow non-storefront retail of both adult-use and medicinal cannabis with annual renewal of a Cannabis Regulatory Permit by taking the following actions:
1. Adopt a Resolution rescinding Resolution 22-144, which would eliminate the numerical limit on cannabis businesses permitted to operate in the city; and
2. Introduce for first reading by title only an Ordinance to allow non-storefront retail cannabis businesses in the Riverside Corridor (RSC) and Commercial/Light Industrial (C-3) zoning districts and to establish a cannabis regulatory permit by:
a. Adding Paso Robles Municipal Code Chapter 5.55 (Cannabis Regulatory Permit), b. Amending Paso Robles Municipal Code Table 21.32-1 (Zoning District Use Regulations), c. Amending Paso Robles Municipal Code Chapter 21.60 (Cannabis), and d. Amending Uptown/Town Centre Specific Plan Table 5.3-1 (Allowed Land Uses and Permit Requirements); and
3. Direct staff to schedule a future public hearing for Council to consider approval of Fee Structure Option A - Hybrid Services Delivery Model.
Staff Recommendation (Option 2)
City of Paso Robles – City Council Comments 805-865-7276 24 Public Comments call 805-865-7276
1. Second reading of the ordinance is required
– September 1
2. City Council adoption of fees
– September 15
3. The ordinance would become effective 30 days after the second reading – October 1
4. Applications for Conditional Use Permits and Cannabis Regulatory Permits would be accepted by the City once the ordinance is effective – October 1
Next steps
City of Paso Robles – City Council Comments 805-865-7276 25 Public Comments call 805-865-7276
▪ Option A (staff recommendation)*
▪ Option B**
Summary of Proposed Fees
Initial Application $
5,500.00
Annual Renewal $
4,600.00
Triennial Financial Audit $ 11,000.00
Initial Application $
7,900.00
Annual Renewal $
6,700.00
Triennial Financial Audit $ 12,000.00
*Background checks fees are billed directly
to applicant by consultant. Dependent on
number required for owners/employees.
**Should Council prefer Option B, additional
analysis on staffing/training costs would be
performed and updated proposal of fees
brought back to City Council for
consideration.
City of Paso Robles – City Council Comments 805-865-7276 26 Public Comments call 805-865-7276
City of Paso Robles – City Council Comments 805-865-7276 27 Public Comments call 805-865-7276
Jurisdiction Allowed
Use
Quantity
Allowed
Quantity
Issued
CUP
Required
Regulatory Permit
Required
Notes
Arroyo Grande No 0 0 N/A N/A
Atascadero Yes No cap 0 Yes No, annual review required
Grover Beach Yes 4 4 Yes Yes Required to operate out of a dispensary Morro Bay Yes No cap 0 No Yes
Pismo Beach No 0 0 N/A N/A
City of SLO Yes No cap 1 Yes Yes 1 dispensary has permission to deliver SLO County Yes No cap 7 Yes No, annual review required Oceano, Nipomo, Arroyo Grande, 2 inland north county.
Cannabis Delivery Office Regulations by Jurisdiction
City of Paso Robles – City Council Comments 805-865-7276 28 Public Comments call 805-865-7276
▪ Names 3 operators temporarily allowed to operate
an adult-use cannabis non-storefront retail
business with premises in Paso Robles
Dubs, Aquamarine Green, and Kinship Holistics
▪ All existing and proposed cannabis businesses will
be required to get approval for a Conditional Use
Permit to establish a permanent adult-use
cannabis non-storefront retail business with
premises in Paso Robles
Rescinding Resolution 22-144
City of Paso Robles – City Council Comments 805-865-7276 29 Public Comments call 805-865-7276
1. The proposed use is likely to enhance or not materially detract from the economic vitality of the area in which it is proposed to be located;
2. The Applicant has adequately addressed potential adverse impacts of the proposed use and will implement appropriate mitigation measures to reduce those impacts to a less-than-significant level or to the maximum extent feasible;
3. The proposed use will not result in an overconcentration of cannabis businesses in the surrounding area; and
4. The extent of support or opposition to the proposed use and location from members of the community has been considered and the project, with conditions of approval, is compatible with the surrounding area.
Required Findings for approving a CUP
City of Paso Robles – City Council Comments 805-865-7276 30 Public Comments call 805-865-7276
Cannabis Regulatory Permit (PRMC Chapter 5.55)
▪ Application process (review, approval, denial, appeal, transfer) ▪ Operational requirements
▪ Annual renewal
▪ Financial audits (every 3 years)
▪ Revocation process
City of Paso Robles – City Council Comments 805-865-7276 31 Public Comments call 805-865-7276
1. The amendments are consistent with the general plan and the Uptown/Town Centre Specific Plan.
2. The amendments will not be detrimental to the public interest, health, safety, convenience, or welfare.
3. The proposed amendment is internally consistent with other applicable provisions of the zoning code.
4. The amendment to the Uptown/Town Centre Specific Plan includes provisions that ensure that adequate public facilities will be available to serve the range of development described in the plan.
5. The properties in the Uptown/Town Centre Specific Plan have unique characteristics that are enhanced by special land use and development standards.
6. The amendment to the specific plan results in the development of desirable character and use types that will be compatible with the surrounding area, provides effective buffering from adjacent uses, and includes policies for the protection of prominent ridgelines, oak trees, and other natural resources.
Findings
City of Paso Robles – City Council Comments 805-865-7276 32 Public Comments call 805-865-7276
1. Whether to repeal Resolution 22-144, which
specifically names 3 non-storefront cannabis
retailers allowed to deliver adult-use cannabis?
2. Whether to eliminate the numeric cap on nonstorefront retailers?
3. Whether to establish a Cannabis Regulatory
Permit?
4. Whether existing CUPs for medical cannabis nonstorefront retail should be amended to allow delivery of adult-use cannabis?
May 5, 2026 Council Study Session
City of Paso Robles – City Council Comments 805-865-7276 33 Public Comments call 805-865-7276
600-foot Buffer
City of Paso Robles – City Council Comments 805-865-7276 34 Public Comments call 805-865-7276
▪ Add “Cannabis, Non-Storefront Retail” to the land use table of the Zoning Ordinance and Uptown/Town Centre Specific Plan
Zoning Amendments – Land Use Tables