Administrative
Report
N.1., File # 22-3543 Meeting Date: 1/18/2022
To: MAYOR AND CITY COUNCIL
From: BRANDY FORBES, COMMUNITY DEVELOPMENT DIRECTOR
TITLE
DISCUSSION AND POSSIBLE ACTION REGARDING THE CITY’S DRAFT CANNABIS LICENSING
ORDINANCE AND THE PROPOSED STOREFRONT SITING PARAMETERS (BUFFER MAPS)
EXECUTIVE SUMMARY
When the Medical Marijuana Regulation and Safety Act (MMRSA), regulating the use of marijuana for medical purposes, took effect January 1, 2016 the City of Redondo Beach adopted Ordinance 3152 to implement local MMRSA regulations. On November 8, 2016, Proposition 64, known as the Adult Use of Marijuana Act (AUMA), was approved by state voters. The AUMA regulates, among other items, the use of marijuana for personal and commercial purposes, including the recreational use of marijuana by adults over 21 years of age.
Proposition 64 stipulated that if a city did not enact local commercial licensing restrictions or a ban by January 1, 2018, a valid state license would be the only thing needed to open and operate a commercial marijuana business in any commercial zone in the city. Therefore, out of caution and until local regulations and interests could be analyzed and identified for implementation, the City of Redondo Beach adopted ordinances to regulate the personal use and cultivation of cannabis and restrict commercial cannabis activities in the City.
In order to analyze and identify the cannabis regulations appropriate for Redondo Beach, a steering committee was appointed by the City Manager comprised of representatives from the law enforcement community, RBUSD, BCHD, and other outside interest groups familiar with common best practices for commercial use regulations of cannabis including storefront siting, taxation, delivery, and development agreement options.
The Steering Committee met multiple times over several years, and on October 5, 2021 presented their work and recommendations to the City Council. After considering the presentation, the City Council asked staff to prepare an ordinance based on the recommendations of the CSC, and directed that the Galleria site be included as a permitted location and that the taxation level or franchise fee rate be set at 5%. Additionally, Council asked staff to return with maps that identified the storefront siting parameters recommended by the CSC, and include buffers for alcohol sales sites and “safe routes to schools” pathways.
This agenda item allows the City Council to give additional direction on the critical provisions and siting parameters to be included in the City’s Ordinance. Following Council direction, staff will update the draft ordinance and present it to the Planning Commission for review and input, likely in March.
N.1., File # 22-3543 Meeting Date: 1/18/2022
BACKGROUND
California’s history of cannabis law spans nearly 25 years of propositions and regulatory actions (see attached). More recently, the Medical Marijuana Regulation and Safety Act (MMRSA) that took effect January 1, 2016 regulated the use of marijuana for medical purposes. The City of Redondo Beach adopted Ordinance 3152 which promulgated local regulations in accordance with MMRSA, effective May 5, 2016.
On November 8, 2016, Proposition 64 was adopted by CA voters, titled the Adult Use of Marijuana Act (AUMA). The AUMA regulates the use of marijuana for personal and commercial purposes, including the recreational use of marijuana by adults over 21 years of age, thus expanding the permissions provided by MMRSA. The AUMA permits cities to “reasonably regulate” without completely prohibiting cultivation of marijuana inside a private residence or inside an accessory structure to a private residence, within the limits allowed by the State for personal cultivation.
In Redondo Beach, 65% of the voters were in favor of Proposition 64. Although Proposition 64 represented the interest of whether to allow the Adult Use of Marijuana Act, it did not specify how an individual municipality would regulate the commercial aspects of marijuana sales. The State’s commercial provisions of AUMA were to take effect on January 1, 2018, requiring a city to disallow commercial marijuana activities in order to ensure that local regulations are promulgated and local control maintained. If a local governing body did not enact such a commercial ban by January 1, 2018, a valid State license would be the only requirement to open and operate a commercial marijuana business in any commercial zone in that city. Therefore, out of caution, and until local regulations and interests could be analyzed, the City of Redondo Beach adopted ordinances to regulate the personal use and cultivation of cannabis, as well as restrict commercial cannabis activities in the City of Redondo Beach. This was an interim measure to prohibit cannabis businesses until the City could better evaluate what types of businesses and regulations to put in place.
One of the prior objectives included in the City Council’s adopted Strategic Plan included the City Manager’s appointment of a Cannabis Steering Committee (CSC) comprised of law enforcement, RBUSD, BCHD, and outside interest groups to review best practices for commercial use regulations of cannabis, including storefront siting, taxation, delivery, and development agreement options, and to prepare a report for Planning Commission and City Council consideration. Members of the Redondo Beach Police Department, Fire Department, Community Development Department, and the City Treasurer’s Office met jointly in support of the work of the CSC.
The CSC met a total of 12 times from November 2018 through October 2021, with their final recommendations presented to City Council on October 5, 2021. After discussion of the CSC’s work and recommendations, City Council directed staff to draft an ordinance based on the recommendations of the CSC for regulating cannabis licenses in Redondo Beach. Additionally the Council directed that the Galleria site be included as a permitted location and the taxation or ultimate franchise fee rate be set at 5%. The Council also directed staff to prepare maps with the siting parameters recommended by the CSC, and that the maps include buffers for alcohol sales sites and safe routes to schools.
N.1., File # 22-3543 Meeting Date: 1/18/2022
The Council asked that, the ordinance, maps, and commercial licensee selection process, once drafted, be reviewed by the Planning Commission for recommendations to the City Council and that a community outreach process also be conducted.
The draft ordinance is being prepared by the Community Development Department and the City Attorney’s office. The key provisions incorporated in the draft thus far, include the following recommendations from the CSC:
· Personal Cultivation. Continue to allow for outdoor personal cultivation as currently regulated for a maximum of 6 plants allowed indoors and in yard area if secured and not visible from surrounding sites.
· Allow Licensed Activity. Permit licensed cannabis businesses with recommended restrictions (see remaining items in the list below).
· License Types. Allow only storefront retailer licenses (Type 10) and non-storefront retailer delivery licenses (Type 9) or a combination of the two on one site. Prohibit delivery services that originate from other cities if a non storefront delivery license is issued in Redondo Beach. · Zoning Provisions. Limit cannabis license sites to commercial and industrial zones. Prohibit licenses in coastal commercial, residential, and public/institutional zones. (CSC had initially recommended prohibiting in regional commercial zone where Galleria is located, but City Council directed staff to add that as an acceptable zone). Require discretionary Conditional Use Permit (CUP) approval.
· Buffers. Maintain a 600-foot radius from elementary schools, day cares, and youth centers (per State’s mandate). Increase the buffer zone to a 1500-foot radius from high schools and middle schools. School buffers to include private schools. · Number and Location of Licenses. Up to two (2) sites within the City, with a maximum of one site per district. Establish a 1000-foot buffer between cannabis licensed sites. · Hours of Operation. The State allows retail activities between the hours of 6 a.m. and 10 p.m. Local jurisdictions can be more restrictive. Recommend limiting hours to the following:
o Storefront Retail Sales - 9 a.m. to 10 p.m.
o Non-storefront Delivery - 6 a.m. to 10 p.m.
· Security. In addition to State security requirements, the Ordinance should include the following security measures:
o All security personnel to be vetted through the Redondo Beach Police Department (RBPD) or a certified 3rd party.
o Regarding surveillance, the licensee must provide real time direct access to all surveillance.
o Alarm systems to be set to send real time immediate messages to RBPD. o Regarding safety, requirements to better define “secure storage of cannabis and cannabis products” as well as onsite revenue.
o The licensee to provide measures to ensure a minor doesn’t enter, requiring ID checks and providing appropriate signage.
o For delivery, licensee to provide a signature for receipt and that those records be maintained on file for auditing purposes.
· Enforcement. The CSC recommends the City implement the Cannabis Compliance and Enforcement Program. The Los Angeles County Department of Public Health has created a relatively new program entitled the Cannabis Compliance and Enforcement Program, where
N.1., File # 22-3543 Meeting Date: 1/18/2022
relatively new program entitled the Cannabis Compliance and Enforcement Program, where the County contracts with cities that allow for cannabis activities. The program aims to further protect public health but has the additional benefit of being an effective enforcement tool against illegal operators who are unable to apply for the permit and subsequently violate Public Health Department Codes.
· Tax or Fees. Establish a Developer Agreement with franchise fees and consider sunsetting it with an eventual tax measure.
· Tax or Fee Rate. 5%. (CSC had initially recommended reviewing neighboring jurisdictions, which the City Council did and selected 5%).
· Tax or Fee Revenue Location. General Fund.
· Property Requirement. Do not require applicant to secure property prior to the application process.
· Selection Process. City Council to determine the licensee solicitation and selection process at a future date separate from the Ordinance.
· Transfer of Ownership. Limit transferability of a developer agreement and/or license for a set period of time.
· Adoption of Regulations. Adopt ordinance to effectuate decisions.
Attached to the report are the requested buffer maps. There are three maps, each subsequent map adding a layer to the first. The maps include:
1. The buffers recommended by the CSC regarding schools, day cares, and youth centers.
2. The buffers in map #1 above, adding pinpoints of the sites of the ABC off-site alcohol retail sales.
3. The buffers and ABC sites in Map #2 above, adding the safe routes to schools locations.
Staff have submitted a draft ordinance that incorporates the CSC’s recommendations to the City Attorney’s office for review and finalization. This agenda item is for the City Council to confirm the key provisions to be included in the draft ordinance and decide on the appropriate retail siting parameters/buffers. Once Council has provided this direction, the draft ordinance and buffer maps will be presented to the Planning Commission and a proposed licensee selection process will be brought to City Council for further discussion.
COORDINATION
This agenda item was prepared by the Community Development Department.
FISCAL IMPACT
The fiscal impact to the City of regulating cannabis sales and delivery in Redondo Beach is unknown at this point. There are many variables to consider including (1) the number of types of licenses to be approved, (2) the volume of business and sales from local cannabis operations, (3) the specific franchise fee or tax rate charged for cannabis sales in Redondo Beach, (4) the amount of staff time allocated to regulatory and enforcement activities, and (5) the potential for legal challenge to the City’s licensing activities.
Notwithstanding the above variables, staff’s initial estimate is that each licensed site in Redondo Beach could provide $500,000 to $1,000,000 in additional annual revenue to the City, provided the City moves forward with the adoption of a regulatory ordinance and the proposed tax/developer fees.
N.1., File # 22-3543 Meeting Date: 1/18/2022
APPROVED BY:
Mike Witzansky, City Manager
ATTACHMENTS
· Administrative Report on Cannabis Steering Committee Update from October 5, 2021 City Council Meeting
· Presentation on Cannabis Steering Committee Update from October 5, 2021 City Council Meeting
· Cannabis Map Final-Buffers 2022-01-12
· Cannabis Map Final-Buffers ABC 2022-01-12
· Cannabis Map Final-Buffers ABC Safe routes 2022-01-12