City of Sacramento
City Council - 5PM Report
915 I Street Sacramento, CA 95814
www.cityofsacramento.org
File ID: 2024-00701 3/19/2024 Consent Item 13.
Grant: Governor’s Office of Business and Economic Development (GO-Biz) Cannabis Equity Grant for Local Jurisdictions
File ID: 2024-00701
Location: Citywide
Recommendation: Adopt a Resolution authorizing the City Manager, or the City Manager’s designee to: 1) execute any and all necessary documentation, including a standard agreement to accept the Governor’s Office of Business and Economic Development (GO-Biz) Cannabis Equity Grant for Local Jurisdictions in the amount of $1,250,000; 2) establish the GO-Biz Cannabis Equity Grant operating project (G02420700); 3) transfer $750,000 for the City’s grant match from the CORE Multi-Year Operating Project (I024200000) to the GO-Biz Cannabis Equity Grant Project (G02420700); and 4) establish the revenue and expenditure budgets for the GO-Biz Cannabis Equity Grant project (G02420700) in the amount of $2 million.
Contact: Davina Smith, Cannabis Manager, (916) 808-4772, [email protected], Lindsay Brown, Administrative Officer, (916) 808-5931, [email protected], Office of Cannabis Management, Office of the City Manager.
Presenter: None.
Attachments:
1 - Description/Analysis
2 - Resolution
3 - Exhibit A - GO-Biz Equity Grant Award Letter
Description/Analysis
Issue Detail: GO-Biz appropriated $15 million in grant funds to qualifying jurisdictions that demonstrate an intent to develop a cannabis equity program or that has adopted and operates a cannabis equity program. The GO-Biz social equity grant focuses on the inclusion and support of individuals in California’s legal cannabis marketplace who are from communities that have been disproportionately impacted by cannabis criminalization. The grant funds are intended to reduce barriers for entrance into the legal cannabis industry for social equity community members.
File ID: 2024-00701 3/19/2024 Consent Item 13.
The City qualified for this grant due to Council’s establishment of the Cannabis Opportunity Reinvestment and Equity (CORE) program on August 9, 2018 (Resolution 2018-0323). The CORE program is intended to reduce the barriers of entry into cannabis businesses for individuals and their immediate family members who have been arrested for cannabis-related crimes between 1990 and 2011 and/or have lived in low-income households in 11 zip codes within the City during that time.
On December 14, 2023, the Office of Cannabis Management (OCM) applied for these grant funds as Type 2: Assistance for Equity Program Applicants and Licensees. OCM was notified by GO-Biz on February 7, 2024, that the city would be awarded $1,250,000 in grant funds with a stipulation for $750,000 in match. Per the grant guidelines, funds must be expended within one year from disbursement.
Accordingly, the GO-Biz grant funds will be used to support a grant program to assist local cannabis equity participants to enter and operate in the regulated cannabis marketplace. There continues to be a large gap between CORE participants and CORE applicants and licensees. This is attributable in great part to the capital-intensive requirements to enter the regulated cannabis marketplace and the lack of generational wealth experienced by most CORE participants.
Attached is the resolution that includes the State-mandated language authorizing the City Manager, or City Manager’s designee to execute all necessary documents to accept the GO-Biz grant funds (Attachment 2).
Policy Considerations: The recommendations in this report are consistent with Council Resolution 2021-0198, Section 11, which requires Council approval to accept grant funding, to establish a grant project, and to appropriate funding when the grant award is $250,000 or more, and when such action is required by a grantor. In addition, to accept the grant, GO-Biz requires that the local agency enter into a standard agreement with GO-Biz and obtain a resolution authorizing the local jurisdiction to enter into the standard agreement and designating by title the individual authorized to sign the agreement on behalf of the local jurisdiction.
On December 12, 2023 Council approved agenda item 2023-01580 authorizing the City Manager, or the City Manager’s designee to execute the application and subsequent agreement for the Governor’s Office of Business and Economic Development (GO-Biz) Cannabis Equity Grant for Local Jurisdictions in the amount of $2 million.
Economic Impacts: None.
Environmental Considerations: None.
Sustainability: Not applicable.
File ID: 2024-00701 3/19/2024 Consent Item 13.
Commission/Committee Action: Not applicable.
Rationale for Recommendation: The GO-Biz grant funds will allow the City to continue its grant program that CORE program participants can utilize to fund start-up costs associated with securing a location and other expenses incurred when establishing a cannabis business.
Financial Considerations: The cost to implement the grant program will be $750,000 in matching funds. In FY2023, the City received a GO-Biz grant in the amount of $1,563,722.87 which is being used to support grants to CORE Program participants, therefore the framework is already in place.
The City has funding set-aside for the required matching funds as part of the CORE MYOP (I02420000).
Staff recommends establishing the GO-Biz Cannabis Equity operating grant project (G02420700) with a revenue and expenditure budget in the amount of $2 million in the Operating Grants Fund (Fund 2702). GO-Biz grant funds are intended to reduce barriers to entry into the legal, regulated cannabis industry for social equity community members.
Local Business Enterprise (LBE): Not applicable.
RESOLUTION NO.
Adopted by the Sacramento City Council
GRANT: THE GOVERNOR’S OFFICE OF
BUSINESS AND ECONOMIC DEVELOPMENT CANNABIS EQUITY
GRANT PROGRAM FOR LOCAL JURISDICTIONS
BACKGROUND
A. On August 9, 2018, the City Council established the Cannabis Opportunity Reinvestment and Equity (“CORE”) program to provide special assistance for entering in the commercial cannabis industry to individuals who were impacted by the disparate enforcement of cannabis related crimes.
B. The members of the California Legislature have recognized the need for cannabis equity grant funding and passed AB 97 to provide equity grant funds to local governments (Stats. 2019, Ch. 40)
C. Funding has been provided to the Governor’s Office of Business and Economic Development (GO-Biz) to provide $15 million in grant funds to local governments that implement a local equity program.
D. On December 14, 2023, the Office of Cannabis Management applied to GO-Biz for the grant funds, requesting $2,000,000 in total funding, $750,000 of which is matching funds from The City.
E. The City of Sacramento has determined that it will use the GO-Biz grant funds to assist social equity applicants and permit holders through the CORE Program as described in the application for grant funds.
BASED ON THE FACTS SET FORTH IN THE BACKGROUND, THE CITY COUNCIL RESOLVES AS FOLLOWS:
Section 1. The City Manager, or the City Manager’s designee, is authorized to execute by electronic signature on behalf of the City of Sacramento any and all necessary documentation to apply for the GO-Biz grants in the amount of $2,000,000.
Section 2. It is agreed that any liability arising out of the performance of this grant agreement, including civil court actions for damages, shall be the responsibility of the grant recipient and the city. The Governor’s Office of Business and Economic Development and the State of California disclaim responsibility for any such liability.
Section 3. The City Manager, or the City Manager’s designee is authorized to establish the GO-Biz Cannabis Equity Grant Project (G02420700) in the amount of $2 million along with the revenue and expenditure budget in the Operating Grant Fund (Fund 2702)
Section 4. The City Manager, or the City Manager’s designee is authorized to transfer $750,000 for the City’s grant match from the CORE Multi-Year Operating Project (I024200000) to the GO-Biz Cannabis Equity Grant Project (G02420700)
Section 5. Exhibit A and B are a part of this Resolution.
Table of Contents:
Exhibit A – GO Biz Equity Grant Award Letter
1325 J Street, 18th FLOOR, SACRAMENTO, CALIFORNIA 95814 February 7, 2024
Davina Smith
Cannabis Manager
915 I St.
Second Floor Attention: Office of Cannabis Management
Sacramento, CA 95814
Dear Davina Smith,
Thank you for your Type 2 grant application for the Cannabis Equity Grants Program for Local Jurisdictions. Based on our review of your application and pursuant to the point-based scoring system and funding formula outlined in the Grant Solicitation, we are pleased to inform you that City of Sacramento is eligible for a grant award of up to $1,250,000.00. We intend to issue an announcement of all jurisdictions receiving funding within the next few weeks. In order to proceed with providing you a grant agreement for signature, please email the following information to [email protected]:
1. An updated budget spreadsheet reflecting the total amount of the grant award. As soon as possible, and no later than February 19th, please make any updates to the enclosed budget spreadsheet so that we can finalize your budget for inclusion in your grant agreement. Please let us know if the matching funds budget spreadsheet submitted with your application needs to be updated as well.
2. All grant agreements must be signed via our electronic signature platform, DocuSign. Please provide the name, title, and email address for the individual that will be signing the grant agreement no later than February 19th.
3. Lastly, to receive grant funding a resolution is required from your jurisdiction’s governing body authorizing the jurisdiction to enter into the grant agreement with GO-Biz and designating by title the individual who is authorized to sign the agreement on behalf of the jurisdiction. It is important to place a resolution request on the governing body’s agenda immediately to avoid funding delays. A sample resolution is attached.
Note: The approved resolution MUST contain all of the components found in the attached sample resolution. Authorizing resolutions must be received by GO-Biz no later than April 1, 2024.
The grant agreement must be signed by the jurisdiction using DocuSign no later than April 1, 2024.
Congratulations, and we look forward to working with you on next steps. Please contact us if you have any questions.
Best regards,
Katie Raley, Grant Supervisor
Grant Supervisor, Community and Local Equity Grants Unit Governor’s Office of Business and Economic Development (GO-Biz) 1325 J Street, Suite 1800 | Sacramento, CA 95814