Ordinance amending Chapter 5, Article VII of the Salinas Municipal Code; Cannabis Regulations Courtney Grossman, Planning Manager
Community Development Department
November 7, 2023
Commercial Cannabis Business Types
The City issues two types of commercial cannabis business permits: Commercial Cannabis Permits (CCP) and Administrative Permits (AP) CCPs are applicable to Cultivation, Delivery, Dispensary, Distribution, and Manufacturing APs are applicable to Testing Laboratories, Small Distribution (business premises under 500 square feet), Research and Development Facilities, and Nurseries
Commercial Cannabis Permit Status
The City has issued 19 permits out of a total of 23:
At permit quota for dispensary, distribution, and manufacturing 9 businesses are operational and have received a certificate of occupancy 11 businesses are not operational – only 5 have shown recent activity Business Type
Permit Quota
Active Permits*
Operational Businesses*
Cultivation
5 3
1 Delivery
3 1
1 Dispensary
5 5
3 Distribution
5 5
2 Manufacturing
5 5
2 Total
23 19
9 *As of July 2023.
The Amendment
The Amendment would modify the cannabis regulations as follows:
Combine Dispensary and Delivery business types under a new definition of Retail Facility, which could allow up to a total of eight (8) business permits in a combination of dispensary and delivery services thereby potentially creating additional opportunities for Dispensaries; Reduce the required sensitive use buffer distance from 1,000 to 600 feet to align with state law; and Add authority to the cannabis selection committee to approve a Retail Facility if located within a non-state regulated sensitive use buffer upon findings that the intent of this article would otherwise be met.
Proximity to Sensitive Uses: 1,000’ Map 600’ Map
CEQA Consideration
Adoption of this Ordinance is exempt from environmental review under the California Environmental Quality Act (CEQA) pursuant to the general rule that CEQA applies only to projects which have the potential for causing a significant effect on the environment.
Conclusion/Recommendation
The Amendment has been reviewed by the City Council Cannabis Subcommittee.
Supports the Council’s goal of Economic Development by creating additional opportunities for Dispensaries under the new definition of Retail Facility, which may result in additional tax revenues.
The Amendment has been coordinated with the Legal Department.
A motion to find the Amendment exempt from the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Section 15061(b)(3) and to adopt an Ordinance amending Cannabis regulations Chapter 5, Article VII of the Salinas Municipal Code.
End of Presentation
The Cannabis Industry
Nursery
Grows/Clones Immature Plants
Sells to Retailer and Cultivation
Statewide Market
Taxed at $2/square foot
Administrative Permit
No Maximum
None Approved
None Operating
The Cannabis Industry
Retailer (Delivery)
Sells Directly to the Consumer
Non-Storefront
Regional Market
Taxed at 5% GR
CC Permit
Three Maximum
One Approved
One Operating
The Cannabis Industry
Retailer (Dispensary)
Sells Directly to the Consumer
Storefront
Local Market
Taxed at 5% GR
CC Permit
Five Maximum
Five Approved
Three Operating
The Cannabis Industry
Cultivation
Grows/Harvests Mature Plants
Sells to Retailer and Manufacturer
Statewide Market
Taxed at $15/square foot
CC Permit
Five Maximum
Three Approved
One Operating
The Cannabis Industry
Manufacturer
Oil Extraction/Infusion, Product Manufacture
Sells to Retailer
Statewide Market
Taxed at 5% GR
CC Permit
Five Maximum
Four Approved
Two Operating
The Cannabis Industry
Distribution
Moves Product Between Licensees
Acts as Broker and Collects State Taxes
Statewide Market
Not Taxed
CC Permit
Five Maximum
Four Approved
Two Operating
The Cannabis Industry
Testing Lab
Ensures Product Safety and Potency
Tests Samples When Product is Moved
Local/Regional Market
Not Taxed
Administrative Permit
No Maximum
Two Approved
Two Operating