June 24, 2025
AGENDA
Community Development REPORT
DATE: June 24, 2025
TO: Mayor Martinez and Members of the City Council
FROM: Lina Velasco, Director of Community Development
Eva Mann, Code Enforcement Manager
Kevin Tisdell, Code Enforcement Officer II
Subject: Amendment of the City’s Tobacco Retailers Moratorium FINANCIAL IMPACT: The urgency ordinance revisions and exceptions, if adopted, would be enforced pursuant to routine code
enforcement efforts, which are included within the City’s budget. The proposed amendment is not expected to
have any fiscal impact on the General Fund.
PREVIOUS COUNCIL
ACTION:
April 16, 2024
May 21, 2024
April 1, 2025
STATEMENT OF THE
ISSUE:
The City Council is considering amending the scope of
the tobacco retailer moratorium to create a pathway for long-standing Richmond-based tobacco retailers to
continue selling tobacco products while the moratorium
remains in effect. The proposed amendment would
establish a Pathway to Compliance Program for legacy
retailers that meet certain City Council-identified criteria and an expanded opportunity to meet the City’s most
current compliance requirements. The City Council also directed staff to identify qualifying businesses that meet the criteria and return with a draft ordinance amendment for further consideration.
RECOMMENDED ACTION: RECEIVE a report from staff regarding their findings of potential legacy non-compliant tobacco retailers that
meet City Council’s expressed criteria for an exception to the current tobacco retailers moratorium, and
CONSIDER whether to INTRODUCE an ordinance
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Amending Ordinance No. 03-25 as amended that would
allow identified long-time Richmond-based retailers who once held a City tobacco retailers license to obtain such license during the moratorium — Community
Development Department/Code Enforcement Division
(Lina Velasco/ Eva Mann/Kevin Tisdell 510-621-1283).
BACKGROUND:
The City Council of the City of Richmond has a well-documented record of regulating the activity of tobacco retailing in the City that protects the public health, safety, and welfare of its residents, and most importantly its youth.
On September 26, 2017, following a presentation by the Youth Tobacco Advocacy & Policy Project, the City Council directed staff to prepare amendments to the Tobacco Retailer License Ordinance to: (1) prohibit the sale of menthol and other flavored products citywide; (2) establish a minimum pack size of 20 for little cigars and cigars; and, (3) restrict new tobacco retailers from opening within 500 feet of existing licensed retailers and within 1,000 feet of youth sensitive areas including schools, playgrounds, parks, and libraries (“location requirements”). Following a study session held on January 30, 2018, the City Council provided additional direction to staff including outreach and education with the Richmond community and tobacco retailers regarding the proposed amendments.
On July 17, 2018, the City Council adopted Ordinance No. 20-18 N.S., which, among other things, amended Richmond Municipal Code (“RMC”) Chapter 7.106, prohibiting the sale of menthol and other flavored tobacco products, establishing a minimum pack size for little cigars and cigars, and imposing location requirements on new tobacco retailers from youth populated areas and other licensed retailers. In passing this ordinance, the City Council adopted explicit and extensive findings highlighting how the sale of tobacco, particularly to youth, presents an imminent threat to the public health, safety, and welfare of the residents of the City of Richmond.
With this ordinance, the City Council also addressed how lawfully operating tobacco retailers existing in 2018 would otherwise be ineligible to receive or renew a tobacco retailer license because of the new location requirements from other licensed retailers and youth-populated areas would be allowed to continue their operation. In RMC
7.106.060, which is still in effect today, those lawfully operating tobacco retailers were permitted to “receive or renew a license for that location so long as all the following conditions are met:
(1) The license is timely obtained and is renewed without lapse. (2) The Tobacco Retailer does not commit 3 or more violations of this Chapter at a location within any sixty-month period.
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(3) The Tobacco Retailer is not closed for business or otherwise suspends Tobacco Retailing for more than sixty (60) consecutive days. (4) The Tobacco Retailer does not substantially change the business premises or business operation. A substantial change to the business operation includes, but is not limited to, the transferring of a location to new Proprietor(s) in an Arm’s Length Transaction and the transferring of a location for which a significant purpose is avoiding the effect of the violations of this Chapter. (5) The Tobacco Retailer retains the right to operate under all other applicable laws.”
In sum, allowing existing tobacco retailers that were operating lawfully prior to the effective date of Ordinance No. 20-18 (August 17, 2018) to continue to operate despite the new location requirements was contingent on meeting all five of these conditions.
Notably, the first threshold condition was maintaining a city tobacco retailer license without lapse.
On September 10, 2019, the City Council adopted Ordinance No. 14-19 N.S. amending Richmond Municipal Code Chapter 7.106 - Tobacco Retailer License - to prohibit the sale of electronic cigarettes.
In 2021, the oversight of the Tobacco Retailer License program was transferred from the Richmond Police Department’s Regulatory Unit to the Code Enforcement Division of the Community Development Department.
In late 2023, the City began to notice an increase in the establishment of new tobacco retailers that failed to obtain proper licensing. Following these complaints regarding the proliferation of unlicensed tobacco retailers, locations of tobacco retailer businesses, and the harmful effects of tobacco on the health, safety and welfare of city residents, especially youth, on April 15, 2024, the City Council adopted Urgency Ordinance No. 03-24 N.S., which placed a temporary 45-day moratorium on the issuance of any new permits, license, or entitlement for any new tobacco retailer within the City. On May 21, 2024, the City Council adopted Urgency Ordinance No. 05-24 N.S. extending the temporary moratorium to April 15, 2025, to provide staff sufficient time to study the issue and propose amendments to the Municipal Code (Attachment 1).
DISCUSSION:
On April 1, 2025, City staff requested that the Council consider extending the temporary moratorium for another 12 months, until April 15, 2026, to allow additional time to complete tasks related to creating a new regulatory structure for tobacco retailers. The City Council unanimously passed Ordinance No. 09-25, which extended the moratorium until April 15, 2026 (Attachment 2).
However, when considering the ordinance to extend the moratorium, the City Council discussed the impacts the moratorium may have on long-time Richmond-based retailers, who once held a City tobacco retailers license, and the potential of creating a
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pathway for these long-standing Richmond-based tobacco retailers to obtain a City tobacco retailer license while the moratorium remains in effect. The proposed amendment would establish a Pathway to Compliance Program for existing legacy tobacco retailers that:
Held a valid City of Richmond tobacco retailer license at any point between 2018 and 2024,
Have continuously maintained a valid City of Richmond business license, Hold a valid State Tobacco Retailers license,
Have the same ownership as when previously licensed as a City of Richmond Tobacco Retailer, and
Have not been found to be engaging in illicit activities, such as selling cannabis, and other drugs.
The Council directed staff to identify tobacco retailers who met the outlined criteria and therefore qualified their businesses to be included in the Pathway to Compliance and draft the proposed ordinance amendment for further consideration.
Summary of Analysis of Unlicensed Tobacco Retailers
Based on direction received from the City Council, staff conducted a review of all the tobacco retailers that have no city tobacco retailers license (referred to as “unlicensed tobacco retailers”) using several criteria including: Current business owner versus previously licensed tobacco retailer owner name, CA State tobacco license status, City of Richmond business license status, and whether they once held a City of Richmond tobacco retailer license between 2018-2024 (Attachment 3).
As part of its analysis, City staff is also providing information regarding whether the unlicensed tobacco retailer would meet the current location requirements, which imposes a 500-foot buffer from another licensed tobacco retailer and a 1,000-foot buffer from a youth populated area. The analysis also includes which Council District the unlicensed tobacco retailer is located in.
Furthermore, the chart analyzes 51 unlicensed tobacco retailers, focusing on their compliance with the criteria specified above and other data the City Council may want to consider in their decision to amend the moratorium. Since the last hearing, City staff has confirmed a 52nd unlicensed business, which a Cease-and-Desist Order is being prepared for delivery.
The key findings are:
1. Licensing and Permits:
Of the 51 unlicensed tobacco retailers, 25 have a current City business license and 45 have a State Tobacco license (based on data provided by the California Department of Tax and Fee Administration in November of 2024).
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Of the 51 unlicensed tobacco retailers, 22 tobacco retailers have both the State Tobacco license and City business license.
2. Violations Discovered During Inspection(s):
8 of the 51 unlicensed tobacco retailers have had violations related to selling cannabis or other drugs
An additional 8 businesses were found to have other violations including out-of-state tobacco, untaxed tobacco, and retailing without a State tobacco license. There are a total of 16 unlicensed retailers that have been cited for violations.
Due to limited staffing and time constraints, the tobacco taskforce has not inspected every unlicensed business. 25 unlicensed tobacco retailers have not been inspected and are scheduled for inspections post this staff report.
3. Ownership:
Several previously licensed tobacco retailers have undergone changes in ownership. Per Richmond Municipal Code Section 7.106.110(a), a tobacco retailer license is nontransferable from one person to another or from one location to another. “A tobacco retailer’s license may not be transferred from one person to another or from one location to another. A new tobacco retailer’s license is required whenever a tobacco retailing location has a change in proprietor(s).”
15 of the 51 unlicensed tobacco retailers are the same owner names that were registered on the previously issued City Tobacco Retailer license between 2018-2024.
4. Compliance with Cease & Desist Orders issued by the City Visual tobacco inspections were conducted on April 21 and 22, 2025, to determine which of the unlicensed tobacco retailers have stopped selling tobacco products. The inspections found that 31 unlicensed retailers continue to sell tobacco products, while 18 have stopped selling tobacco products. Two (2) businesses appear to have closed.
5. Geographical Distribution and Analysis of Retailers by Council Districts:
Two to three times more tobacco retailers are located in Districts 1 and 3 in comparison to all other districts. Within these districts, unlicensed Tobacco Retailers outnumber licensed Tobacco Retailers. Districts 2 and 4 have the least number of tobacco retailers.
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Table A. Tobacco Retailers by Council District
Council District Unlicensed Licensed District Total
Brown, D1 12 9 21
Zepeda, D2 5 4 9
Robinson, D3 18 6 24
Bana, D4 0 1 1
Wilson, D5 7 4 11
Jimenez, D6 9 7 16
TOTAL 51 31 82
6. Compliance with Location Requirements
18 of the unlicensed tobacco retailers would comply with the location requirement to be 500 feet from another licensed tobacco retailer. Three (3) of the 51 unlicensed tobacco retailers comply with the requirement to be 1,000 feet from youth-identified areas. None of the unlicensed tobacco retailers would comply with both required location requirements.
7. Qualification for Potential License Exception
The City Council set the following criteria to be eligible for the potential Pathway to Compliance to obtain a tobacco retailing license:
1. Held a valid City of Richmond tobacco retailer license at any point between 2018 and 2024
2. Have continuously maintained a valid City of Richmond business license
3. Hold a valid State Tobacco Retailers license
4. Have the same ownership as when previously licensed as a City of Richmond Tobacco Retailer
5. Have not been found to be engaging in illicit activities. 9 unlicensed tobacco retailers qualify for the City Council’s potential pathway to compliance license based on the criteria above; however, if the City Council wanted to expand the compliance pathway to not consider the owners names matching the original license, an additional 9 retailers would qualify, making the total of 18 legacy businesses qualifying to be a part of the Pathway to Compliance. Assuming all qualifying businesses apply to obtain the City’s Tobacco Retailer license, the total licensed business would increase from 32 to 50 businesses.
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Table B. Eligible Tobacco Retailers for Exception by Council District Council District Using 5 criteria Using 4 criteria District Total Brown, D1 3 3 9+3=12
Zepeda, D2 1 1 4+2=6
Robinson, D3 3 9 6+9=15
Bana, D4 0 0 1+0=1
Wilson, D5 1 1 4+1=5
Jimenez, D6 1 4 7+4=11
TOTAL 9 18 50
Overall, the analysis highlights multiple factors that must be attended to in order for tobacco retailers to meet the Pathway to Compliance Program criteria set by the City Council, including the need for regular tobacco retailer education on requirements and applicable laws.
The City Council’s adoption and subsequent extensions of the tobacco retailer license moratorium—through Urgency Ordinance Nos. 03-24 N.S., 05-24 N.S., and 09-25 N.S.—have been driven by the City Council’s compelling and ongoing need to protect the health, safety, and welfare of Richmond residents, which is consistent with past actions taken by the Council. The moratorium was enacted to pause the proliferation of tobacco retail operations while City staff develop comprehensive regulatory strategies in response to identified patterns of noncompliance, illicit activity, and public health risks.
Summary of Proposed Moratorium Amendments to Tobacco Moratorium
The proposed ordinance amends the City of Richmond’s existing tobacco moratorium (Urgency Ordinance No. 03-24, as extended) by establishing criteria and a Pathway to Compliance Program for qualifying legacy tobacco retailers (Attachment 4).
Specifically, the amendment:
1. Creates a Pathway to Compliance Program Criteria:
Qualifying tobacco retailers would be exempt from the moratorium and be allowed to obtain a City tobacco retailer license if they meet all of the following criteria:
a. Held a valid City tobacco license at any time between 2018 and 2024. b. Maintained a valid City of Richmond business license continuously from 2018 to the present.
c. Current owner and previously licensed owner are the same. d. Hold a State Tobacco License.
e. Have not been issued violations for illicit activities.
These tobacco retailers would be given additional opportunities through the Pathway to Compliance Program to meet the locational standards specified in the current
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ordinance, and would be considered as a businesses that did not have a lapsed license.
2. Reaffirmation of Moratorium:
All other provisions of the original and extended moratorium remain in effect through April 15, 2026, unless rescinded earlier. No new tobacco retailers outside the allowed Pathway to Compliance criteria may be permitted.
The subject ordinance requires a first and second reading and would be effective 30 days from adoption. If introduced tonight, the second reading is scheduled for July 1, 2025, meaning the qualifying legacy retailers would be eligible to obtain a City tobacco retailer license after August 1, 2025.
Offering a Pathway to Compliance Program and Criteria, in lieu, of the full moratorium requires City Council consideration given the public health goals the City Council is balancing with the economic impact that the tobacco moratorium has on unlicensed tobacco retailers, especially those businesses that have been operating in the city for many years. To that end, staff provides two options for the City Council to consider:
Option 1: Maintain the Moratorium as Passed: Pause on adopting the Pathway to Compliance amendment to the Moratorium.
Rationale:
Preserves the integrity, uniformity, and public health intent of the moratorium Ensures consistency with prior Council actions aimed at curbing youth access to tobacco and reducing public health risks
Avoids complications from determining eligibility based on legacy status Prevents administrative liability, uneven enforcement, and potential repetitive non-compliance behaviors of tobacco retailers
Reinforces the seriousness of regulatory reform by signaling a clear pause while the City staff finalizes and presents to the City Council long-term regulatory strategies
Encourages retailers to consider and rely on business activity, other than tobacco retailing, that better serves the community’s health, safety, and welfare
Option 2: Establish a Pathway to Compliance Program for Legacy Tobacco Retailers: Amend the moratorium to create a Pathway to Compliance Program and Criteria for legacy tobacco retailers operating prior to the moratorium to obtain a City tobacco retailer license.
Rationale:
Balances the City’s public health strategic goals with economic, equity, and efficacy considerations for legacy tobacco retailers
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Offers a Pathway to Compliance Program and criteria to unlicensed tobacco retailers who have contributed to the local economy and have a legacy of positive investments in the City of Richmond
Provides a final opportunity for unlicensed tobacco retailers to come into compliance and demonstrate a commitment to regulatory compliance going forward
Helps mitigate concerns from unlicensed tobacco retailers who may feel unfairly penalized by the moratorium
Considers retailer experience and/or hardship with the City’s licensing requirements and processes
CONCLUSION:
Ultimately, the decision to provide pathways to compliance, in lieu of the moratorium, lies with the City Council and reflects a broader policy choice about how best to balance public health priorities with the economic, equity, and efficacy realities facing unlicensed tobacco retailers. Each option presents trade-offs: maintaining the moratorium underscores the City's strong public health stance and simplifies enforcement, while a Pathway to Compliance Program recognizes the challenges faced by legacy tobacco retailers and offers a path to compliance, demonstrating a commitment to uphold the strategic goals of the City. City staff seek direction from the City Council on how to proceed, ensuring that future regulations align with both community well-being and equitable economic opportunities.
DOCUMENTS ATTACHED:
Attachment 1 – Moratorium Ordinance Nos. 03-24 N.S., 05-24 N.S., and 09-25 N.S.
Attachment 2 – City Council Meeting Minutes - April 1, 2025 Attachment 3 – Table of Unlicensed Retailers Analysis
Attachment 4 – Draft Ordinance Amending Moratorium