ORDINANCE NO. 870
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF PATTERSON
CONFIRMING THE TERMINATION OF THE DEVELOPMENT AGREEMENT BY
AND BETWEEN THE CITY OF PATTERSON AND CENTRAL VALLEY-SIERRA
ASSOCIATES AND AUTHORIZING THE RECORDING OF A NOTICE OF
TERMINATION
WHEREAS, on December 5, 2017 the City adopted Ordinance No. 812 approving a Development Agreement (the “Agreement”) between the City of Patterson (the “City”) and Central Valley-Sierra Associates (the “Operator”) for the operation of a cannabis dispensary business (the “Project”) located at 100 West Las Palmas Avenue, Suite H, Patterson CA 95363, Assessor’s Parcel Number 131-003-012 (the “Site”); and
WHEREAS, Section 4.2 of the Agreement requires Operator to pay to the City certain amounts to offset the impacts to City infrastructure, services, and neighborhoods, commensurate with the private benefits conferred on Operator (the “Public Benefit Amount”), pursuant to the terms stated in Section 4.2 of the Development Agreement; and WHEREAS, Section 4.3 of the Agreement requires that any failure by Operator to make any Public Benefit Amount payments to the City as they become due and payable in accordance with the terms of the Agreement “may constitute full and sufficient grounds for the revocation” of the Conditional Use Permit (“CUP”) associated with the Project; and WHEREAS, the Operator failed to make the required Public Benefit Amount payments (the “Delinquent Public Benefit Amount”) by the agreed-upon terms, resulting in a default of the Agreement, pursuant to Section 4.3 and 8.1(a); and
WHEREAS, on June 17, 2022, following unsuccessful discussions to resolve the default and bring the Project current, City gave written notice to Operator specifying the nature of the default and the manner in which the default may be cured, included an offer to settle the Delinquent Public Benefit Amount and cure Operator’s default, and provided 10 days’ notice that if the default was not cured during that period, the City would commence proceedings to revoke the CUP and terminate the Development Agreement with Operator; and
WHEREAS, Operator failed to cure any of the material defaults of the Agreement within the required timeframe, and City and Operator did not reach an agreement to resolve the Delinquent Public Benefit Amount, cure the default, or extend the term of the Development Agreement; and
WHEREAS, since approximately January 2023, Operator has engaged a new company, Catalyst Cannabis Company (“Catalyst”) to assist with operation and management of the Project, and City and Catalyst also did not reach an agreement to resolve the Delinquent Public Benefit Amount, cure the default, or extend the term of the Agreement; and
WHEREAS, the Agreement, by its own terms, expired on or about July 4, 2022, pursuant to Section 9.1, and has not been renewed, updated, extended, reactivated, or made current, and remains expired; and
WHEREAS, pursuant to Section 9.3 of the Agreement, the termination of the Agreement eliminated any further obligation of City to comply with the Agreement or any part of it; and WHEREAS, on March 29, 2023, City sent a notice to Operator of its intent to initiate proceedings to confirm the expiration of the Agreement and revoke the CUP associated with the Project; and
WHEREAS, on July 13, 2023, following a public hearing, the City of Patterson Planning Commission (“Planning Commission”) adopted Resolution No. 2023-07, revoking CUP No. 17- 21 for failure to comply with Conditions of Approval, and found that the Agreement had terminated on July 4, 2022, and that CVSA was in default of the Agreement at the time of its termination and had failed to cure the default; and
WHEREAS, also on July 13, 2023, following a public hearing, the Planning Commission passed Resolution No. 2023-06 recommending that the City Council adopt an Ordinance to confirm the termination of the Agreement on the ground that the cannabis dispensary can no longer legally operate without a valid CUP; and
WHEREAS, Patterson Municipal Code section 6.56.030 requires any cannabis business allowed in the City to obtain a development agreement and a conditional use permit; and WHEREAS, the City Council of the City of Patterson, based on its independent review and analysis of staff’s recommendations, oral and written testimony, and the record as a whole, finds, after due study, deliberation, and public hearing, and based on its independent judgment, that Operator has not demonstrated good faith compliance with the terms of the Development Agreement, and the Term of the Development Agreement, as defined in Section 1.7, expired in 2022, has not been extended, reinstated, or reactivated.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF PATTERSON DOES ORDAIN AS FOLLOWS:
SECTION 1. The City Council of the City of Patterson (the “City Council”) hereby affirms that the Development Agreement by and Between the City of Patterson and Central Valley-Sierra Associates, recorded in the Office of the Stanislaus County Recorder as Document No. 2018- 0017054-00, terminated on July 4, 2022, upon expiration of the Term, in accordance with Sections
1.7 and 9.1 of the Development Agreement.
SECTION 2. The City Council instructs the City Attorney to record a written notice of termination (“Notice of Termination”) in substantial conformance with the Notice of Termination attached as Exhibit F to the Development Agreement, upon adoption of this Ordinance.
SECTION 2. Notice of the public hearing on the confirmation of termination of the Development Agreement was published in a newspaper of general circulation, printed and published in the City; and notices of the public hearing on the termination of the Development Agreement were mailed to all interested parties and property owners within three hundred (300) feet of the property, according to the most recent assessor’s roll.
SECTION 3. If any section, subdivision, sentence, clause, phrase, or portion of this Ordinance is, for any reason, held invalid or unconstitutional by any court of competent jurisdiction, such portion shall be deemed a separate, distinct and independent provision, and such holding shall not affect the validity of the remaining portions thereof.
SECTION 4. This Ordinance shall become effective thirty (30) days from and after its final passage and adoption, provided it is published in a newspaper of general circulation at least fifteen (15) days prior to its effective date or a summary of the Ordinance is published in a newspaper of general circulation at least five (5) days prior to adoption and again at least fifteen (15) days prior to its effective date.
The foregoing Ordinance was introduced at a regular meeting of the City Council of the City of Patterson, held on the 19
th day of September 2023, by __________________, who moved its introduction, which motion was duly seconded by ___________________. Said Ordinance was given a second reading at a regular meeting of the City Council held on the ___, day of __________, 2023, and after such reading, _________________ moved its adoption, seconded by , and said Ordinance was thereupon adopted by the following roll call vote:
AYES:
NOES:
EXCUSED:
APPROVED:
___________________________
Michael Clauzel
Mayor of the City of Patterson
ATTEST:
____________________________
Aracely Alegre
City Clerk of the City of Patterson