Code to assure that the operations of the collective are in compliance with California law and to mitigate the adverse secondary effects from operations of dispensaries.
Sec. 40-103. Operating Standards.
(a) No recommendations from a doctor for medical marijuana shall be issued on-site. (b) A collective shall only dispense medical marijuana to qualified patients and their caregivers as defined by California Health and Safety Code § 11362.5 (Proposition 215). This shall include possession of an original valid doctor's recommendation, not more than one (1) year old, for medical marijuana use by the patient. (c) A collective shall notify patrons of the following through posting of a sign in a conspicuous location:
(1) Use of medical marijuana shall be limited to the patient identified on the doctor's recommendation. Secondary sale, barter or distribution of medical marijuana is a crime and can lead to arrest.
(2) That loitering on and around the collective site is prohibited by California Penal Code § 647(e) and that patrons must immediately leave the site and not consume medical marijuana in the vicinity of the collective or on the property or in the parking lot.
(3) Forgery of medical documents is a felony crime.
(4) A warning that patrons may be subject to prosecution under federal marijuana laws.
(5) That the use of medical marijuana may impair a person's ability to drive a motor vehicle or operate machinery.
(d) A collective shall not provide marijuana to any individual in an amount not consistent with personal medical use
(e) Marijuana shall not be grown or cultivated at collective sites, except that cuttings of the marijuana plant may be kept or maintained on- site for distribution to qualified patients and primary caregivers as follows:
(1) The cuttings shall not be utilized by a collective as a source for the provision of marijuana for consumption on-site, however, upon provision to a qualified patient or primary caregiver, that person may use the cuttings to cultivate marijuana plants off-site for their own use and they may also return marijuana from the resulting mature plant for distribution by the collective.
(2) For the purposes of this paragraph, the term "cutting" shall mean a rootless piece cut from a marijuana plant, which is no more than six (6) inches in length, and which can be used to grow another plant in a different location.
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(f) A collective shall comply with applicable provisions of the California Health and Safety Code §§ 11362.5 through 11362.83, inclusive.
Sec. 40-104 Medical Marijuana Waitlist.
(a) Pursuant to Ordinance No. NS -2864, adopted December 9, 2014, t he Director of Planning and Building shall prepare Cooperative/Collective registration application forms and a related administrative policy. Each collective interested in operating pursuant to this article may submit an application together with a non- refundable processing fee in an amount established by the City Council. Within 60 days after the adoption of Ordinance No. NS-2864, the Director shall stop accepting applications and process all applications received.
(b) The Director or his or her designee shall h ave determined whether each application demonstrates compliance with this article. Each application that is in compliance with this article shall be placed on the "Qualified Registration Applicant List" and the Director shall notify the applicant in writing that it is a "Qualified Registration Applicant."
(c) Once all applications are processed, the Director shall have held an independent selection process ("lottery") in an open and public location and select 20 applications.
The 20 applications chosen through the independent selection process (lottery) will be placed on the "Regulatory Safety Permit ("RSP") Eligibility List." Each applicant on the RSP Eligibility List may then choose to file an application for a RSP pursuant to section 40-9. All applicants identified on the RSP Eligibility List following the February 5, 2015 independent selection process (lottery) shall be required to concurrently: (1) File an application for an RSP and (2) Submit all required construction plans for plan check by the City by March 30, 2023, subject to the requirements of this Chapter and other applicable chapters of the Santa Ana Municipal Code, and be operational with sustained business activity within 180 days of construction permit issuance. An extension may be issued for a period of time as may be reasonably required to affect upgrades, modifications, repairs, or other property issue mitigations as approved by the Director of Planning and Building or his or her designee. Failure to satisfy these requirements by that deadline will disqualify the applicant from the RSP Eligibility List and the Waitlist described in subsection (d). Relocation is permitted pursuant to Section 40-7 of this Chapter.
(d) Qualified Registration Applicants will appear on the "Qualified Registration Applica nt List" in the order that they are selected during the independent selection process (lottery). This list is the Waitlist. The Waitlist will become active if (1) an applicant on the RSP Eligibility List is disqualified from that List; (2) a location appearing on the RSP Eligibility List becomes available; or (3) a location not appearing on the RSP eligibility list becomes available. A Qualified Registration Applicant's ability to move from the Waitlist to the RSP Eligibility List is determined by the applicant's proposed medical marijuana collective location and the applicant's position on the Waitlist.
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(e) A Qualified Registration Applicant that moves from the Waitlist to the RSP Eligibility List must submit a completed RSP application within three (3) months following issuance of a written notice advising the applicant of that opportunity. Failure to submit a completed RSP application by that deadline will disqualify the applicant from the RSP Eligibility List and the Waitlist.
(f) The Director shall maintain th e Waitlist and update it on an annual basis unless terminated pursuant to subsection 40- 104 (g) through (j) . A Qualified Registration Applicants on that Waitlist must submit a written request each year to maintain its status on the waitlist.
(g) Relocation of an existing and licensed medical marijuana collective or medical marijuana cooperative as defined in Article II of this Chapter that is operating in full compliance with the provisions of this Article is permitted subject to Section 40- 7 of this Chapter.
Sec. 40-105. Maintenance of records.
A medical marijuana collective shall maintain records at the location accurately and truthfully documenting:
(a) The full name, address, and telephone number(s) of the owner, landlord and/or lessee of the location;
(b) The full name, address, and telephone number(s) of all members who are engaged in the management of the collective and the exact nature of each member's participation in the management of the collective;
(c) The full name, address, and telephone number(s) of all patient members to whom the collective provides medical marijuana, a copy of a government -issued identification card for all patient members;
(d) The full name, address, and telephone number(s) of all primary caregiver members to whom the collective provides medical;
(e) All receipts of the collective, including but not limited to all contributions, reimbursements, and reasonable compensation, whether in cash or in kind, and all expenditures incurred by the collective for the cultivation of medical marijuana; and (f) Proof of compliance with the California Attorney General Guidelines for the Security and Non-Diversion of Marijuana Grown for Medical Use.
These records shall be maintained by the collective for a period of five (5) years and shall be made available by the collective to the police department and/or community preservation division upon request. If they are not produced as requested the city may seek a search warrant, subpoena, or court order. In addition to all other formats that the collective may maintain, these records shall be stored by the collective at the location in a printed format in its fireproof safe. Any loss, damage or destruction of the records shall
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be reported to the police department within twenty-four (24) hours of the loss, destruction or damage.
Sec. 40-106. Audits – Cooperatives/Collectives.
Annual audits. No later than September 30 of every year, each licensed medical marijuana collective shall be liable to file with the city an independent audit or financial review of its operations of the previous calendar year. Provided, however, that licensed collectives which operate on a vertically or horizontally integrated basis as established in Chapter 21, Article XII of this Code, or that are co-located on shared premises may file a consolidated audit or independent financial review. The form and contents of the document shall be specified by the executive director of finance and management services, or his/her designee(s). The Executive Director of Finance and Management Services, or his or her designee(s) may waive this requirement for certain licensed collectives in accordance with guidelines established by the Finance and Management Services Agency.
Sec. 40-107. Applicability to existing medical marijuana operations.
Any existing medical marijuana collective, dispensary, operator, establishment, or provider that does not comply with the requirements of this article must immediately cease operation until such time, if any, when it complies fully with the requirements of this article.
No medical marijuana collective, dispensary, operator, establishment, or provider that existed prior to the enactment of this article shall be deemed to be a legally established use under the provisions of this article, and such medical marijuana collective, dispensary, operator, establishment, or provider shall not be entitled to claim legal nonconforming status.
Sec. 40-108. Compliance with this article and state law. (a) It is unlawful for any person to:
i. Cause, permit or engage in the giving away of marijuana, or ii. Own, establish, operate, use or permit the establishment or operation of a medical marijuana collective or cooperative, or to participate as an employee, contractor, agent, responsible person or volunteer of a collective or cooperative, except as provided in this article, and pursuant to any and all other applicable local and state laws.
iii. The prohibition in subsection (ii) above includes, renting, leasing, or otherwise permitting a medical marijuana business to occupy or use a location, vehicle, or other mode of transportation.
(b) It is unlawful for any person to cause, permit or engage in any activity related to medical marijuana except as provided in Health and Safety Code § 11362.5 et seq., and pursuant to any and all other applicable local and state laws.
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(c) It is unlawful for any person to knowingly make any false, misleading or inaccurate statements or representations in any forms, records, filings or documentation required to be maintained, filed or provided to the City under this article, or to any other local, state or federal government agency having jurisdiction over any of the activities of collectives.
(d) It shall be the sole responsibility of the members engaged in the management of the collective to ensure that the collective is at all times operating in a manner compliant with all applicable state laws and this article. Nothing in this article shall be construed as authorizing any actions which violate state law with regard to the cultivation, transportation, provision, and sale of medical marijuana. (e) Cultivation of Marijuana.
(1) Personal Cultivation. Individuals twenty-one (21) years of age or older may plant, cultivate, harvest, dry, or process up to six (6) living marijuana plants for personal (non-commercial) use in a private residence or accessory structure to a single private residence in the City of Santa Ana and must comply with the following requirements:
i. The marijuana cultivation area shall be located indoors within a private residence or accessory structure on a single parcel of property; ii. No more than six (6) living marijuana plants is permitted for indoor personal cultivation;
iii. Marijuana in excess of twenty -eight and one- half (28.5) grams produced by plants kept for indoor personal cultivation must be kept in a locked space on the grounds of the private residence not visible from the public right-of way. iv. There shall be no exterior visibility or evidence of marijuana cultivation outside the private residence from the public right -of-way, including but not limited to any marijuana plants, equipment used in the growing and cultivation operation, or any light emanating from the cultivation; or
v. The cultivation may not violate any California Building, Electrical or Fire Codes or any other health and safety standards.
(2) Commercial Cultivation. Commercial cultivation of marijuana or cannabis is prohibited anywhere in the City except as allowed and regulated in Article I of this Chapter.
(3) Outdoor Cultivation. Outdoor commercial cultivation of marijuana or medical marijuana is prohibited anywhere in the City. No person, including a qualified patient or primary caregiver, shall engage, permit, or participate in the outdoor commercial cultivation of marijuana in the City.
(4) Public Nuisance Prohibited.
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(i) It is hereby declared to be unlawful and a public nuisance for any person owning, leasing, occupying, or having charge or possession of any parcel within the City to create a public nuisance in the course of cultivating marijuana plants or any part thereof in any location, indoor or outdoor, except as allowed and regulated in Chapter 40 of the Santa Ana Municipal Code. A public nuisance may be deemed to exist, if such activity produces:
(1) Odors which are disturbing to people of reasonable sensitivity residing or present on adjacent or nearby property or areas open to the public; (2) Repeated responses to the parcel by law enforcement personnel; (3) A repeated disruption to the free passage of persons or vehicles in the neighborhood, excessive noise which is disturbing to people of normal sensitivity on adjacent or nearby property or areas open to the public; (4) Any other impacts on the neighborhood which are disruptive of normal activity in the area including, but not limited to, grow lighting visible outside the dwelling, excessive vehicular traffic or parking occurring at or near the dwelling, and excessive noise emanating from the dwelling. (5) Outdoor and Commercial growing and cultivation of marijuana, except as allowed and regulated in Chapter 40 of the Santa Ana Municipal Code. (f) A permitted medical marijuana dispensary may deliver medical marijuana only to a qualified patient or caregiver. Medical marijuana delivery services by dispensaries possessing regulatory safety permits must comply with Business and Professions Code §19340. Delivery of cannabis from a dispensary permitted pursuant to this Chapter can only be made in a city or county that does not expressly prohibit it by ordinance. Delivery services by dispensaries not in possession of regulatory safety permits is expressly prohibited.
(g) Non-Retail Commercial Cannabis Businesses for Medicinal and Adult -Use Cannabis as defined in Article I of Chapter 40 of the Santa Ana Municipal Code (SAMC) are permitted subject to the regulations and standards contained within Chapter 40 of the SAMC.
Section 8. Section 21-127 of Article XII of Chapter 21 of the Santa Ana Municipal Code is hereby amended to read in full as follows:
Sec. 21- 127. - Marijuana collectives/cooperatives— Annual business license ta x assessment.
(a) Annual business license tax assessment for marijuana collectives/cooperatives. (1) Every collective/cooperative whether it is organized or conducted as a "not for profit" business, a "non- profit" business, or a "for -profit" business, shall
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pay an annual business license tax in accordance with Chapter 21 and the sections and subsections hereunder.
(2) For the purposes of this article, a marijuana collective/cooperative is defined in section 40 -101(b) and is considered to be a business as that ter m is defined in section 21-3.
(3) For the purposes of this article, a collective/cooperative is not considered to be a religious or charitable organization.
(4) "Medical marijuana collective/cooperative" or "collective/cooperative" shall mean any activity regulated or permitted by chapter 40. (5) For the purposes of this article, a marijuana collective/cooperative is not considered to be a business or person having a "specified exemption" or "specified exclusion" from business license taxation as set forth in sections 21-48 and 21-49.
(6) For the purposes of this article, a "nonprofit organization" shall mean any institution or organization that is exempted from taxes measured by income or gross receipts pursuant to Article XIII, Section 26 of the California Constitution as codified under Chapter 4 (commencing with Section 23701) of Part 11 of Division 2 of the Revenue and Taxation Code and Section 37101 (c) of the Government Code or Sub- Chapter F (commencing with Section 501) of Chapter 1 of Subtitle A of the Internal Revenue Code of 1986. An institution or organization operating as a collective/cooperative and claiming a gross receipts assessment business license tax exemption under this section shall have the burden of furnishing to the collector such information as the collector may require to validate the claim of exemption including but not limited to such a determination by the California Franchise Tax Board or any other information requested by the collector. (7) For the purposes of this article, "gross receipts" shall mean any transfer of title or possession, exchange or barter, conditional or otherwise, in any manner or by any means whatsoever, of tangible personal property for a consideration including any monetary consideration for marijuana whatsoever, including, but not limited to, membership dues, reimbursements provided by members, regardless of form, or the total amount of cash or in-kind contributions, including all operating costs related to the growth, cultivation or provision of marijuana or any transaction related thereto. "Gross receipts" shall also include without limitation anything else of value obtained by a collective/cooperative. The term "gross receipts" shall also include the total amount of the sale price of all sales, the total amount charged or recei ved for the performance of any act, service or employment of whatever nature it may be, whether or not such service, act
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or employment is done as a part of or in connection with the sale of goods, wares, merchandise, for which a charge is made or credit allowed, including all refunds, cash credits and properties of any amount or nature, any amount for which credit is allowed by the seller to the purchaser without any deduction therefrom, on account of the cost of the property sold, the cost of materials used, the labor or service cost, interest paid or payable, losses, or any other expense whatsoever; provided that cash discounts allowed or payment on sales shall not be included. "Gross receipts" shall also include the amount of any federal, manufacturer's or importer's excise tax included in the price of property sold, even though the manufacturer or importer is also the retailer thereof and whether or not the amount of such tax is stated as a separate charge. "Gross receipts" shall not include the amount of any federal tax imposed on or with respect to retail sales whether or not the amount of such tax is stated as a separate charge. "Gross receipts" shall not include the amount of any federal tax imposed on or with respect to retail sales whether imposed upon the retailer or the consumer and regardless of whether or not the amount of federal tax is stated to customers as a separate charge, or any California state, city or city and county sales or use tax required by law to be included in or added to the purc hase price and collected from the consumer or purchaser, or such part of the sales price of any property previously sold and returned by the purchaser to the seller which is refunded by the seller by way of cash or credit allowances given or taken as part payment on any property so accepted for resale. "Gross receipts" shall be calculated without any deduction on account of any of the following:
(i) The cost of tangible property sold or bartered;
(ii) The cost of materials or products used, labor or service cost, interest paid, losses, or other expense; or
(iii) The cost of transportation of the marijuana, or other property or product.
(b) Business license tax rates for marijuana collectives/cooperatives. (1) Every collective/cooperative, excepting a qualified "nonprofit organization," whether it is organized or conducted as a "not for profit" business, a "non- profit" business, or a "for -profit" business, shall pay a separate business license tax at a rate of up to ten (10) percent of the gross receipts generated or otherwise received for each branch establishment or separate property location of the business. The gross receipts tax shall be initially set at a rate of five (5) percent. The maximum tax rate shall not exceed ten (10) percent of gross receipts. This tax shall not be adjusted for inflation pursuant to section 21-121.
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(2) Notwithstanding the maximum tax rate of ten (10) percent of gross receipts imposed under subsection (b)(1), the city council may in its discretion at any time by ordinance implement a lower gross receipts tax rate for all marijuana collectives/cooperatives, as defined in such ordinance, subject to the maximum rate of ten (10) percent of gross receipts. The city council may by ordinance increase any such gross receipts tax rate from time to tim e, not to exceed the maximum gross receipts tax rate established under subsection (b)(1).
(3) Effective January 1, 2018, the gross receipts tax initially set at a rate of five (5) percent pursuant to subsection (b)(1), shall be increased to a rate of six (6) p ercent. The maximum tax rate shall not exceed ten (10) percent of gross receipts. This tax rate shall not be adjusted for inflation pursuant to section 21-121.
(4) Effective January 1, 2023, the gross receipts tax is set at a rate of six (6) percent pursuant to subsection (b)(3), shall be decreased to a rate of five (5) percent. The maximum tax rate shall not exceed ten (10) percent of gross receipts. This tax rate shall not be adjusted for inflation pursuant to section 21-121.
(5) As part of the gross receipt s tax imposed by this article, each collective/cooperative shall pay a minimum basic rate of two thousand dollars ($2,000.00) annually for each separate branch location or separate property location of the business.
(c) Modification, repeal or amendment . The c ity council may repeal the ordinance codified in this article, or amend it in a manner which does not result in an increase in the tax or taxes imposed herein, without further voter approval. The city council may likewise by ordinance adopt and add additional provisions to any other article of this chapter and relate them to this article, or amend any existing provisions of any article of this chapter as they may already relate to this article in any manner which does not result in an increase in the tax or taxes imposed herein, without further voter approval. If the city council repeals said ordinance or any provision of this article, it may subsequently reenact it without voter approval, as long as the reenacted ordinance or section does not result in an i ncrease in the tax or taxes imposed herein.
(d) Administration—Rules, regulations, and guidelines; interpretation/clarification. In order to aid in the city's collection of taxes due under this article and to ensure that all marijuana collectives/cooperatives are taxed consistently to the best of the city's ability, the collector, with the concurrence of the city attorney, may promulgate rules, regulations, and guidelines, to implement and administer this article including, but not limited to rules, regulations, and guidelines harmonizing other provisions of this chapter with the provisions of this article in any manner not inconsi stent with the
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intent of this article and which does not result in an increase in the tax or taxes imposed herein. The collector may also, with the concurrence of the city attorney, interpret or clarify the methodology of the tax, or any definition applicable to the tax, so long as such interpretation or clarification (even if contrary to some prior interpretation or clarification) is not inconsistent with the language of this article. (e) Occasional transactions—Exemptions.
(1) The provisions of this article shall not apply to persons having no fixed place of business within the city who come into the city for the purpose of transacting a specific item of marijuana collective/cooperative business at the request of a specific patient, client or customer, provided that such person does not come into the city for the purpose of transacting business on more than five (5) days during any calendar year.
(2) For any person not having a fixed place of business within the city who comes into the city for the purpose of transact ing collective/cooperative activities, the business tax payable by such person may be apportioned by the collector in accordance with this chapter.
(f) Reporting and remittance. Beginning as set forth in subsection (k) below, and monthly thereafter, each marijuana collective/cooperative (except qualified nonprofit organizations exempt from taxes measured by income or gross receipts) required to pay a tax based on gross receipts under this article, shall report to the city any gross receipts received during the preceding monthly reporting period and shall likewise remit to the city the taxes due and owing during said period. For purposes of this section, month shall mean calendar month, and taxes shall begin to accrue on the date that a person or entity first rec eives a business license or other permit to operate as a collective/cooperative.
The payment of the two thousand dollars ($2,000.00) minimum basic rate gross receipts tax required annually for each separate branch location or separate property location of the business in accordance subsection (b)(3), shall be made annually prior to the beginning of the fiscal year beginning April first of the current year and expiring on the 31st day of March of the following year. In the case of a new collective/cooperative the minimum basic rate gross receipts tax shall be paid in advance prior to any new business activity being undertaken. Every new licensee shall pay in advance an amount equal to one- quarter (¼) of the annual minimum basic rate gross receipts tax, for each quarter and fraction of a quarter remaining during the period for which the new license is issued.
(g) Delinquent date—Penalty. Any individual or entity who fails to pay the taxes required by this article when due shall be subject to penalties and interest as set forth in accordance with this chapter. The collector is not required to send a delinquency or other notice or bill to any person subject to the provisions of this chapter and failure
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to send such notice or bill shall not affect the validity of any tax or penalty due under the provisions of this chapter.
(h) Payment of tax does not authorize unlawful business. (1) The payment of a business tax required by this article, and its acceptance by the city, shall not entitle any person to carry on any collective/cooperative unless the person has complied with all of the requirements of this Code and all other applicable laws, nor to carry on any collective/cooperative in any building or on any premises in the event that such building or premises are situated in a zone or locality in which the conduct of such collective/cooperative is in violation of any law.
(2) No tax paid under the provisions of this article shall be construed as authorizing the conduct or continuance of any illegal or unlawful business, or any legal business in an illegal manner, or any business in violation of any ordinance of the city. Nothing in this article implies or authorizes that any activity connected with the distribution or possession of marijuana is legal unless otherwise authorized and allowed by California and federal law. Nothing in this section shall be applied or construed as authorizing the sale of marijuana. (i) Business license tax certificate—Required. There are imposed upon all persons engaged in transacting and carrying on any collecti ve/cooperative business activity in the city taxes in the amounts prescribed in this article. It shall be unlawful for any person, either for him or herself or for any other person, to commence, transact or carry on any business in the city without first having procured a business license from the city under this chapter and having paid the taxes set forth in this article, and without complying with any and all applicable provisions contained in this chapter.
The carrying on of any collective/cooperative wi thout complying with all the provisions of this article shall constitute a separate violation of this chapter for each and every day that such collective/cooperative is so carried on. (j) Classification of business license assessment type—Term and renewal . The business license issued to marijuana collectives/cooperatives shall be classed as a gross receipts assessment type, issued for the same term of license as set forth in subsection 21-71(c) and shall be subject to renewal in accordance with sections 21- 72(c), 21-73(c), and 21-77.
(k) Operative date. Upon the approval by the majority of the voters of the city at the November 4, 2014 general election, the taxes imposed by this article shall become operative and shall be applied by the collector upon all marijuana collectives/cooperatives.
(l) Operative date of increased or decreased gross receipts tax rate. The gross receipts tax set initially at a rate of five (5) percent pursuant to subsection (b)(1) [(Ordinance No. NS-2864, Section 5, adopted 12-9-14)] and increased to a rate of six (6) percent
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effective January 1, 2018, pursuant to subsection (b)(3) [(Ordinance No. NS-2930, Section 8, adopted 11- 21-17)], shall be decreased to a rate of five (5) percent effective January 1, 2023, pursuant to subsection (b)(4) [(Ordinance No. NS-XXXX, Section 8, adopted XX-XX-XX)].
(m) Notwithstanding the tax rates imposed herein under subsection (l), the City Council may, in its discretion, at any time by resolution, implement any lower or higher tax rate it deems appropriate, not to exceed the maximum rate established by subsections (b)(2).
Section 9. Section 21-133 of Article XIII of Chapter 21 of the Santa Ana Municipal Code is hereby amended to read in full as follows:
Sec. 21-133. Commercial cannabis businesses—Annual business license tax assessment.
Every person engaged in a “commercial cannabis business” or “commercial cannabis activity” shall pay an annual business license tax as outlined below. This Article shall not apply, except with respect to medical marijuana cooperatives/collectives (also referred to as medicinal commercial cannabis medicinal retail businesses) which are vertically and/or horizontally integrated with commercial cannabis businesses, to medical marijuana cooperatives/collectives which are governed by Article XII of this Chapter, or to personal cultivation as defined in section 40-101(b) of this Code. (a) For each branch establishment or separate property location of a commercial cannabis business transacted and carried on in the city, and for each separate type of commercial cannabis business conducted at the same location, the higher of the two (2) following tax rates shall be due to the City for each monthly reporting period:
(1) Up to ten percent (10%) of each dollar of gross receipts received or generated for each monthly reporting period.
(2) Up to $35.00 per square foot (annual tax rate) prorated monthly to one- twelfth (1/12th) of the annual tax rate amount.
(b) These tax rates shall not be adjusted for inflation pursuant to section 21- 121 of this Chapter.
(c) Notwithstanding the tax rates imposed herein under subsection (a), the City Council may, in its discretion, at any time by resolution, implement any lower tax rate it deems appropriate, and may by resolution increase such tax rate from time to time, not to exceed the maximum rates established by subsection (a). (d) As of the operative date of this Article, the business license gross receipts tax rates and square footage tax rates applica tion to specific commercial cannabis business activities have been established by city ordinance [(Ordinance No. NS -2962,
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Section 2 (Exhibit A -1), adopted 11-6-18; and Ordinance No. NS-2972, Section 7, adopted 9 -3-19)] and by the following resolutions as referenced herein below in subsections (s), (t), and (u).
Commercial Cannabis Business Activity Gross Receipts
Tax Rate
Gross Square
Footage Tax
Rate
Adult-use Cannabis Retail Business (including Delivery) (effective beginning December 21, 2018 through
December 31, 2022)
8% $ 25.00
Adult-use Cannabis Retail Business (including Delivery, but not including Consumption Lounge and Temporary
Consumption and/or Special Events) (effective beginning January 1, 2023)
7% $ 25.00
Adult-use Cannabis Retail Business (including Delivery
and Consumption Lounge)
(effective beginning January 1, 2023)
7% $ 25.00
Adult-use Cannabis Retail Business (Temporary
Consumption and/or Special Events)
(effective beginning January 1, 2023)
7% $ 0.00
Qualified Social Equity Adult-use Cannabis Retail Business (including Delivery and Consumption Lounge)
(effective beginning January 1, 2023)
5% $ 25.00
Qualified Social Equity Adult-use Cannabis Retail Business (Temporary Consumption and/or Special Events)
(effective beginning January 1, 2023)
5% $ 0.00
Cultivation
(effective December 21, 2018 through December 31,
2022)
6% $ 10.00
Cultivation
(effective beginning January 1, 2023) 1% $ 7.00
Distribution
(effective December 21, 2018 through December 31,
2022)
6% $ 4.00
Distribution
(effective beginning January 1, 2023) 1% $ 3.00
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With respect to commercial cannabis businesses not having a fixed place of business within the city but conducting regular, non-incidental commercial cannabis business activities within the city, such businesses shall be subject to the gross receipts tax rate(s) pursuant to this Article based on the category/categories of commercial cannabis activity conducted. However, such out -of-town commercial cannabis businesses shall not be subject to any gross square footage tax rate(s).
(e) As part of the annual gross receipts/square footage tax(es) imposed by this Article, each commercial cannabis business located within the city shall pay a minimum Manufacturing
(effective December 21, 2018 through December 31,
2022)
6% $ 10.00
Manufacturing
(effective beginning January 1, 2023) 1% $ 3.00
Shared Manufacturing
(effective beginning January 1, 2023) 1% $ 0.00
Microbusinesses
(Tax rates apply proportionally to microbusiness’ activities corresponding to Adult-use Retail [Adult-use Retail
(including Delivery)] / Cultivation / Manufacturing /
Distribution)
(effective October 4, 2019 through December 31, 2022)
Adult-use Retail
8%
Cultivation,
Distribution &
Manufacturing
6%
Adult-use Retail
$ 25.00
Cultivation &
Manufacturing
$ 10.00
Distribution
$ 4.00
Microbusinesses
(Tax rates apply proportionally to microbusiness’ activities corresponding to Adult-use Retail [Adult-use Retail
(including Delivery, but not including Consumption Lounge and Temporary Consumption and/or Special Events)] /
Cultivation / Manufacturing / Distribution)
(effective beginning January 1, 2023)
Adult-use Retail
7%
Cultivation,
Distribution &
Manufacturing
1%
Adult-use Retail
$ 25.00
Cultivation
$ 7.00
Distribution &
Manufacturing
$ 3.00
Testing Facility or Testing Laboratory
(effective December 21, 2018 through June 30, 2019) 5% $ 1.50 Testing Facility or Testing Laboratory
(effective July 1, 2019) 1% $ 1.50
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basic rate of two thousand dollars ($2,000.00) annually for each branch establishment or separate property location of the commercial cannabis business transacted and carried on in the city, and for each separate type of commercial cannabis business conducted at the same location. Commercial cannabis businesses having no fixed place of business within the city shall be exempted from this requirement. Provided, however, as follows:
(1) that commercial cannabis microbusinesses shall pay a minimum basic rate of two thousand dollars ($2,000.00) annually for each branch establishment or separate property location of the commercial cannabis business transacted and carried on in the city, but not for each separate type of commercial cannabis business conducted at the same location; and
(2) that City licensed commercial cannabis retail businesses which are also licensed by the City for adult -use cannabis retail business (temporary consumption and/or special events), or socially equitable adult -use cannabis retail business (temporary consumption and/or special events) shall pay a minimum basic rate of two thousand dollars ($2,000.00) annually for each branch establishment or separate property location of the commercial cannabis business transacted and carried on in the city, but not for each separate type of commercial cannabis retail business conducted at the same location; and
(3) that whenever in the discretion of the Collector, for the purposes of more fully achieving the intent of this Article, or to more efficiently and equitably administer the provisions of this Article, additi onal administrative commercial cannabis business licenses are required to allow the for the recognition of fee- exempt activities, or to allow for the separate accounting and apportionment of one or more taxable endeavors relating to sub-activities incorporated within a consolidated commercial cannabis tax activity under subsection (d), then the Collector shall require that the affected commercial cannabis business obtain such administrative license(s), and in the case of taxable activities, separately report and pay the applicable gross receipts tax(es) due under the consolidated commercial cannabis tax activity to which said administrative license(s) relate. In such case, the minimum basic rate of two thousand dollars ($2,000.00) annually per license, shall not be applied, however, such administrative license(s) are subject to all other requirements under this Chapter, including all applicable licensing charges and service fees.
(f) In the event the City should in the future permit additional categories of commercial cannabis business activity, as may from time to time be licensed by the State of California, such categories of commercial cannabis activities shall be subject to the same maximum tax rates as imposed herein. The City may by ordinance of the City
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Council initially set the required gross receipts/gross square footage tax rates based on category of cannabis business activity at lesser rates as may be deemed appropriate by the City Council.
(g) For purposes of this Article, a commercial cannabis business is not considered to be a business or person having a “specified exemption” or “specified exclusion” from business license taxation as set forth in sections 21-48 and 21-49 of this Chapter. (h) For purposes of this Article any person claiming an exemption from the gross receipts tax rate component of the combined gross receipts/square footage tax imposed under this Article on the basis of a claim of being a qualified "nonprofi t organization" shall have the burden of substantiating their claim to the same extent and in the same manner as a marijuana collective/cooperative in accordance with section 21-127(a)(6) of this Chapter.
(i) Cannabis businesses shall not pass the taxes imposed by this Article through to an adult-use cannabis retail business customer or commercial cannabis business customer in any fashion except as part of the basic product sales and/or service price.
(j) Definitions. For purposes of this Article, the following terms have the following meanings:
(1) “Adult-Use cannabis retail business” as defined in section 40- 2(4) of this Code.
(2) “Commercial Cannabis Activity” as defined in section 40-2(9) of this Code. (3) “Com mercial cannabis business” as defined in section 40- 2(10) of this Code excluding medical marijuana collectives/cooperatives also referred to as medicinal cannabis retail sales.
(4) “Commercial cannabis adult-use retail business” as defined in section 40- 2(39.4).
(5) “ Consumption Lounge” as defined in section 40- 2(39.1) of this Code. (6) “Cultivation” as defined in section 40-2(11) of this Code. (7) “Delivery” as defined in section 40-2(13) of this Code. (8) “Distribution” as defined in section 40-2(16) of this Code. (9) "Gross receipts" – section 21-3 of this Chapter notwithstanding, “gross receipts” for the purposes of this Article shall mean:
(A) Transfer of title or possession, exchange or barter, conditional or otherwise, in any manner or by any means whatsoever, of tangible personal property for a consideration including any monetary
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consideration for cannabis, including, but not limited to, membership dues, reimbursements provided by members, regardless of form, or the total amount of cash or in- kind contributions, including all operating costs related to the growth, cultivation, manufacturing, distribution, testing, or provision of cannabis or any transaction related thereto.
(B) Anything else of value obtained by an a cannabis business; (C) The total amount of the sale price of all sales and services; (D) The total amount charged or received for the performance of any act, service or employment of whatever nature it may be, whether or not such service, act or employment is done as a part of or in connection with the sale of goods, wares, or merchandise (whether at wholesale or retail), for which a charge is made or credit allowed, including all refunds, cash credits and properties of any amount or nature; (E) Any amount for which credit is allowed by the seller to the purchaser without any deduction therefrom, on account of the cost of the property sold, the cost of materials used, the labor or service cost, interest paid or payable, losses, or any other expense whatsoever; provided that cash discounts allowed or payment on sales shall not be included;
(F) The amount of any federal manufacturer's or importer's excise tax included in the price of property sold, even though the manufacturer or importer is also the retailer thereof;
(G) The amount of any California state cannabis excise tax or state cannabis cultivation tax included in the price of the product; (H) “Gross receipts" shall not include the following:
i. The amount of any federal tax imposed on or with respect to retail or wholesale sales or the sale of services whether imposed upon the cannabis business or the consumer whenever the amount of federal tax is authorized by law to be stated and passed through to customers as a separate charge.
ii. Any California state, county, or city sales or use tax, including any add-on, district, or transaction and use tax, required by law to be included in or added to the purchase price and collected from the consumer or purchaser, or such part of the sales price of any property previously sold and returned by the purchaser to the seller which is refunded by the seller by way of cash or credit
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allowances given or taken as part payment on any property so accepted for resale; or
iii. The amount of the sale price of business personal property (all property owned or leased by a cannabis business operator used in the operation cannabis business activities, including but not limited to: furniture, fixtures, and business equipment); real property, including land, buildings and other improvements. iv. The amount of equity contributions, investments, and/or loan proceeds to cannabis business’ operation, and/or proceeds from the sale or transfer of cannabis business’ retail or commercial cannabis business.
v. The amount of interparty sales and/or transfers of goods within a single vertically and/or horizontally integrated cannabis business, where the sales or transfers goods are between two or more commercial cannabis business licensees (excluding testing facilities or testing laboratories), or one or more said commercial cannabis business licensee(s) and one or more medicinal cannabis retail business licensee(s), as set forth in accordance with section 21-131.2 and/or section 21-142.
(I) ”Gross receipts" shall be calculated without any deduction on account of any of the following:
i. The cost of tangible or intangible property sold or bartered; ii. The cost of materials or products used, labor or service cost, interest paid, losses, or other expense;
iii. The cost of transportation of cannabis, or other property or product;
iv. The amount of any federal or state income or franchise taxes; and
v. Any other business costs or expenses, unless otherwise specifically exempted.
(10) “Gross square foot” or “gross square footage” for the purposes of this Article shall mean:
(A) In the case of commercial cannabis businesses licensed by the state to engage in an adult-use cannabis retail business, the gross number of square feet comprising the adult -use cannabis retail property location as confirmed by the corresponding “approved building set” or “approved certificate of occupancy” on fi le with the City of Santa
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Ana Planning and Building Agency, whichever is the greater of any square footage indicated, whether such adult -use cannabis retail business is part of an on- site vertically or horizontally integrated cannabis business or not.
(B) In the case of commercial cannabis businesses licensed by the state to engage in cultivation, the aggregate number of square feet comprising all areas of the premises under “canopy”, whether such sum is greater or lesser than the gross square footage as st ated in the “approved building set” or “approved certificate of occupancy”, and whether such commercial cannabis cultivation business is part of an on-site vertically integrated cannabis business or not. “Canopy” shall mean the designated area(s) of a prem ise that will contain mature plants at any point in time. Canopy shall be calculated in square feet and measured using clearly identifiable boundaries of all area(s) that will contain mature plants at any point in time, including all of the space(s) within the boundaries. Canopy may be noncontiguous, but each unique area included in the total canopy calculation shall be separated by an identifiable boundary which includes interior walls, shelves, greenhouse walls, hoop house walls, garden benches, hedgerows, fencing, garden beds, or garden plots; and if mature plants are being cultivated using a shelving system, the surface area of each level shall be included in the total canopy calculation.
Canopy shall be subject to independent measurement and
calculation by duly authorized employees or agents of the City at the time of application for a Santa Ana Business License and annually thereafter at the time of the renewal of such license, or more often as may be deemed necessary in the discretion of the collector.
Whenever an independent canopy measurement and calculation is required under the terms of this Article or whenever the collector in his or her discretion determines that the independent measurement and calculation of a licensee’s canopy is desirable to ef fectuate the proper assessment or collection of the business license taxes required to be paid under the terms of this Chapter, or for any other purposes related to the express aims of this Article then a canopy measurement shall be performed and a corresponding service fee shall be applicable in the amount as specified by resolution of the City Council.
(C) In the case of commercial cannabis businesses licensed by the state to engage in distribution or manufacturing and that are not occupying
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the same pre mises with another cannabis business , the gross number of square feet as confirmed by the corresponding “approved building set” or “approved certificate of occupancy” on file with the City of Santa Ana Planning and Building Agency, whichever is the greater of any square footage indicated.
(D) In the case of commercial cannabis businesses licensed by the state to engage in distribution or manufacturing and occupying the same premises with another cannabis business, the gross number of square feet allocated by the commercial cannabis business owner/operator respectively for either distribution use or for manufacturing use, whether the combined sum of all uses is less than, equal to, or greater than the gross square footage as stated in the “approved building set” or “approved certificate of occupancy”.
The number of square feet allocated (“Allocated Square Footage”) shall be subject to independent measurement and calculation by duly authorized employees or agents of the City at the time of application for a Santa Ana Business License and annually thereafter at the time of the renewal of such license, or more often as may be deemed necessary in the discretion of the collector. Whenever an independent allocated square footage measurement and calculation is required under the terms of this Article or whenever the collector in his or her discretion determines that the independent measurement and calculation of a licensee’s allocated square footage is desirable to effectuate the proper assessment or collection of the business license taxes required to be paid under the terms of this Chapter, or for any other purposes related to the express aims of this Article then an Allocated Square Footage measurement shall be performed and a corresponding service fee shall be applicable in the amount as specified by resolution of the City Council. (E) In the case of commercial cannabis businesses licensed by the state to engage in testing facilities or testing laboratory businesses, the gross number of square feet comprising such c ommercial cannabis business’ property location as confirmed by the corresponding “approved building set” or “approved certificate of occupancy” on file with the City of Santa Ana Planning and Building Agency, whichever is the greater.
(11) “Manufacturing” as defined in section 40-2(22) of this Code.
(12) “Microbusiness” as defined in section 40-2(24) of this Code.
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(13) “Consumption Lounge” as defined in section 40-2(39.1) of this Code.
(14) “Qualified Social Equity Adult-use Cannabis Retail Business” as set out in section 40- 16 of this Code. To include: “ Socially Equitable Adult -use Cannabis Retail Business (including Delivery and Consumption Lounges)”, and “ Socially Equitable Adult -use Cannabis Retail Business Temporary Consumption and/or Special Events)”.
(15) “Retail business” as defined in section 40-2(39) of this Code. (16) “Shared manufacturing” as defined in section 40-2(22.5) of this Code. (17) “Temporary Consumption Event” and “Temporary Consumption Festival” as defined in section 40-2(39.2 and 39.3) of this Code. (18) “Testing Facility” or “Testing Laboratory” as defined in section 40-2(43) of this Code.
(19) “Wholesale" as defined in section 40-2(44) of this Code. (k) Modification, repeal or amendment . The City Council may repeal the ordinance codified in this Article, or amend it in a manner which does not result in an increase in the tax or taxes imposed herein, without further voter approval. The City Council may likewise by ordinance adopt and add additional provisions to any other Article of this Chapter and relate them to this Article, or amend any existing provisions of any Article of this Chapter as they may already relate to this Article in any manner which does not result in an increase in the tax or taxes imposed herein, without further voter approval. If the City Council repeals said ordinance or any provision of this Article, it may subsequently reenact it without voter approval, as long as the reenacted ordinance or section does not result in an increase in the tax or taxes imposed herein.
(l) Administration—Rules, regulations and guidelines. In order to aid in the city's collection of taxes due under this Article and to ensure that all commercial cannabis businesses are taxed consistently to the best of the city's abi lity, the collector, with the concurrence of the city attorney, may promulgate rules, regulations, and guidelines, to implement and administer this Article including, but not limited to rules, regulations, and guidelines harmonizing other provisions of thi s Chapter with the provisions of this Article in any manner not inconsistent with the intent of this Article and which does not result in an increase in the tax or taxes imposed herein. The collector may also, with the concurrence of the city attorney, int erpret or clarify the methodology of the tax, or any definition applicable to the tax, so long as such interpretation or clarification (even if contrary to some prior interpretation or clarification) is not inconsistent with the language of this Article.
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(m) Occasional transactions— Exemptions.
(1) The provisions of this Article shall not apply to persons having no fixed place of business within the city who come into the city for the purpose of transacting a specific item of commercial cannabis business at the request of a specific client or customer, incidental to a commercial cannabis business principally established elsewhere, provided that such person does not come into the city for the purpose of transacting such business on more than three (3) days during any calendar year. (2) For any person not having a fixed place of business within the city who comes into the city for the purpose of transacting commercial cannabis business activities, the business license tax(es) payable by such person may be apportioned by the collector in accordance with this Chapter. (n) Reporting and remittance.
(1) Beginning as set forth in subsection (r) below, and monthly thereafter, each commercial cannabis business required to pay a tax or taxes based on gross receipts under this Article (except qualified nonprofit organizations exempt from taxes measured by income or gross receipts), shall report to the city any gross receipts received during the preceding monthly reporting period. In addition, each cannabis business (i ncluding qualified nonprofit organizations) required to pay a tax or taxes based on square footage shall report to the city the gross square footage of the cannabis business’ property location. Every cannabis business shall then compute the business licens e taxes at both the gross receipts rate and the gross square footage rate - prorated monthly to one-twelfth (1/12th) of the annual tax rate amount - and shall then remit to the city the amount of the higher of the two tax calculations due and owing during said period in accordance with section 21-133, subsection (d). In the case of a qualified nonprofit organization only the gross square footage computation shall be made and the amount of such calculation shall represent the amount due and owing during said period. All reporting and remitting made shall be done in accordance with instructions from the collector and shall be made using forms provided or approved by the collector.
(2) For purposes of this section, month shall mean calendar month and shall include any fraction of a month. Taxes shall begin to accrue on the date that a person or entity first receives a business license or other city permit to operate as a commercial cannabis business or upon the operative date of this Article should a person or entity already possess a commercial cannabis business license or other city permit to operate as a commercial cannabis business.
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(3) The payment of the two thousand dollars ($2,000.00) minimum basic rate gross receipts tax required annually for each separate branch location or separate property location of the business in accordance with this section, shall be made annually prior to the beginning of the fiscal year beginning April first of the current year and expiring on the 31st day of March of the following year. In the case of a new commercial cannabis business the minimum basic rate gross receipts tax shall be paid in advance prior to any new business activity being undertaken. Every new licensee shall pay in advance an amount equal to one- quarter (¼) o f the annual minimum basic rate gross receipts tax, for each quarter and fraction of a quarter remaining during the period for which the new license is issued. (o) Delinquent date—Penalty. Any individual or entity who fails to pay the taxes required by this Article when due shall be subject to penalties and interest as set forth in accordance with this Chapter. The collector is not required to send a delinquency or other notice or bill to any person subject to the provisions of this Article and failure to send such notice or bill shall not affect the validity of any tax or penalty due under the provisions of this Article.
(p) Business license tax certificate/receipt —Required. There are imposed upon all persons engaged in transacting and carrying on any commercial cannabis business activity in the city taxes in the amounts prescribed in this Article. It shall be unlawful for any person, either for him or herself or for any other person, to commence, transact or carry on any business in the city without first having procured a business license from the city under this Chapter and having paid the taxes set forth in this Article, and without complying with any and all applicable provisions contained in this Chapter. The carrying on of any commercial cannabis business activity without complying with all the provisions of this Article shall constitute a separate violation of this Chapter for each and every day that such commercial cannabis activity is so carried on.
(q) Classification of business license assessm ent type—Term and renewal . The business license issued to commercial cannabis businesses shall be classed as a gross receipts assessment type, issued for the same term of license as set forth in subsection 21-71(c) of this Chapter and shall be subject to renewal in accordance with sections 21-72(c), 21-73(c), and 21-77.
(r) Operative date. Upon the approval by the majority of the voters of the city at the November 6, 2018 general election, the taxes imposed by this Article shall become operative and shall be applied by the collector upon all commercial cannabis businesses.
(s) Operative date of decreased gross receipts tax rate (Testing Facilities or Testing Laboratories). The gross receipts tax set initially at a rate of five (5%) percent for testing fac ilities or testing laboratories pursuant to subsection (d) above shall be
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decreased to a rate of one (1%) percent by resolution of the City Council [Santa Ana City Council Resolution No, 2019- 068] as hereinabove provided for in accordance with subsection ( c), which reduced rate, under the terms of said City Council resolution, shall become retroactively effective July 1, 2019. (t) Operative date of decreased gross receipts tax rate (Cultivation, Manufacturing, and Distribution, Adult-use Cannabis Retail Bus iness (including Delivery and Consumption Lounges), Adult -use Cannabis Retail Business (Temporary Consumption and/or Special Events). The gross receipts tax set initially at a rate of six (6 %) percent for cultivation, manufacturing, and distribution pursuant to subsection (d) above shall be decreased to a rate of one (1%) percent, and the gross receipts tax rate set initially at a rate of eight (8%) for all adult-use cannabis retail business (including delivery) activities pursuant to subsection (d) above shall be decreased to seven (7%) percent to include the sub-activity of consumption lounges, and the ancillary adult-use cannabis retail business (temporary consumption and/or special events ) activity; the parallel activities of social equity adult -use cannabis retail business (including delivery and consumption lounge), and the ancillary social equity adult-use cannabis retail business (temporary consumption and/or special events) activity are set at a reduced five (5%) percent, by resolution of the City Council [Santa Ana City Council Resolution No, 2022-XXX] as hereinabove provided for in accordance with subsection (c), which reduced rates, under the terms of said City Council resolution, shall become effective January 1, 2023. (u) Operative date of decreased square footage tax rate (Cultivation, Manufacturing, Distribution, Adult-use Cannabis Retail Business (Temporary Consumption and/or Special Events), Qualified Social Equity Adult -use Cannabis Retail Business (Temporary Consumption and/or Special Events) . The square footage tax set initially at a rate of ten ($10) dollars per square foot for cultivation and manufacturing, and four ($4) dollars per square foot for distribution pursuant to subsection (d) above shall be decreased to a rate of seven ( $7) dollars per square foot for cultivation, three ($3) dollars per square foot for manufacturing, three ($3) dollars per square foot for distribution; and to a rate of zero ($0) dollars per square foot for shared manufacturing, adult-use cannabis retail business (temporary consumption and/or special events), and qualified social equity adult -use cannabis retail business (temporary consumption and/or special events) by resolution of the Ci ty Council [Santa Ana City Council Resolution No, 2022- XXX] as hereinabove provided for in accordance with subsection (c), which reduced rates, under the terms of said City Council resolution, shall become effective January 1, 2023.
(v) Notwithstanding the tax rates imposed herein under subsections (d),(s),(t), and (u), the City Council may, in its discretion, at any time solely by resolution, implement any lower or higher tax rate it deems appropriate, not to exceed the maximum rates established by subsection (a).
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Section 10. Section 21- 135 of Article XIII of Chapter 21 of the Santa Ana Municipal Code is hereby amended to read in full as follows:
Sec. 21- 135. - Single property location; multiple state licenses; separate city business licenses.
Sections 21-7, 21 -8, and 21- 9 of this chapter notwithstanding, separate city business licenses, issuable to commercial cannabis businesses pursuant to this article, shall be required for each separate type of commercial cannabis business activity transacted and carried on at a single city property location for which a commercial cannabis business may seek licensure by the state, or for which a state license has been approved or issued.
Provided, however, that commercial cannabis business activity transacted and carried on at a single city property location for which a commercial cannabis business may seek licensure by the state as a microbusiness, or for which a state license has been approved or issued as a microbusiness, shall in such case be required to obtain a separate city business license business for each of the commercial cannabis activities transacted and carried on.
Section 11. If any section, subsection, sentence, clause, phrase or portion of this ordinance is for any reason held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this ordinance. The City Council of the City of Santa Ana hereby declares that it would have adopted this ordinance and each section, subsection, sentence, clause, phrase or portion thereof irrespective of the fact that any one or more sectio ns, subsections, sentences, clauses, phrases, or portions be declared invalid or unconstitutional.
Section 12. This Ordinance shall become effective January 1, 2023.
Section 13. The Clerk of the Council shall certify the adoption of this ordinance and shall cause the same to be published as required by law.
ADOPTED this _______ day of ___________, 2022.
________________________________
Vicente Sarmiento
Mayor
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APPROVED AS TO FORM
Sonia R. Carvalho, City Attorney
By: _________________________
John M. Funk
Chief Assistant City Attorney
AYES: Councilmembers: __________________________________
NOES: Councilmembers:__________________________________
ABSTAIN: Councilmembers: _________________________________
NOT PRESENT: Councilmembers: _________________________________
CERTIFICATE OF ATTESTATION AND ORIGINALITY
I, _____________, Clerk of the Council, do hereby attest to and certify that the attached Ordinance No. NS -______ to be the original ordinance adopted by the City Council of the City of Sa nta Ana on ________________, 2022 and that said ordinance was published in accordance with the Charter of the City of Santa Ana.
Date: ______________________ ________________________________ Clerk of the Council
City of Santa Ana
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Resolution No. 2022-XXX
RESOLUTION NO. 2022-XXX
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
SANTA ANA ADDING COMMERCIAL CANNABIS BUSINESS
ACTIVITY TAX RATE CATEGORIES FOR: ADULT-USE
CANNABIS RETAIL BUSINESS (INCLUDING DELIVERY,
BUT NOT INCLUDING CONSUMPTION LOUNGE AND
TEMPORARY CONSUMPTION AND/OR SPECIAL EVENTS);
ADULT-USE CANNABIS RETAIL BUSINESS (INCLUDING
DELIVERY AND CONSUMPTION LOUNGE) ; ADULT-USE
CANNABIS RETAIL BUSINESS (TEMPORARY
CONSUMPTION AND/OR SPECIAL EVENTS) ; QUALIFIED
SOCIAL EQUITY ADULT -USE CANNABIS RETAIL
BUSINESS (INCLUDING DELIVERY AND INCLUDING
CONSUMPTION LOUNGE); SOCIAL EQUITY ADULT -USE
CANNABIS RETAIL BUSINESS (TEMPORARY
CONSUMPTION AND/OR SPECIAL EVENTS) ; SHARED
MANUFACTURING; AND ESTABLISHING RELATED GROSS
RECEIPTS AND SQUARE FOOTAGE TAX RATES
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SANTA ANA AS FOLLOWS:
Section 1. The City Council of the City of Santa Ana hereby finds, determines and declares as follows:
A. In November 2016, the California Marijuana Legalization Initiative, also known as the Adult Use of Marijuana Act (AUMA or Proposition 64) was approved by the voters of the State of California. The AUMA legalized specified personal use and cultivation of marijuana for adults 21 years of age or older.
B. In 2017, the Governor signed into law Senate Bill 94 also known as Medicinal and Adult -Use Cannabis Regulation and Safety Act (MAUCRSA) establishing state regulations and licensing for retail sales, manufacturing, distribution, delivery and testing of adult-use (also called recreational) marijuana.
C. On November 21, 2017, the City Council created Chapter 40 of the Santa Ana Municipal Code, allowing adult-use commercial cannabis retail businesses in the city, and amended certain sections of Chapters 18 and 21 of the Santa Ana Municipal Code to ensure consistency with State law and Chapter 40. Since 2014, the City has allowed medicinal marijuana collectives/ cooperatives to operate within the City pursuant to regulations set forth in Chapter 18 and Chapter 21 of the Santa Ana Municipal Code.
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D. In 2018, the City Council adopted Ordinance Nos. NS-2941 and NS-2942, allowing and regulating commercial cannabis businesses.
E. A general business license tax based on the gross receipts derived from commercial cannabis businesses and where applicable gross square footage serves to generate essential funds for protecting vital City services and facilities and places such businesses on more equal footing with existing City businesses, including medical marijuana collective/cooperative (medicinal cannabis retail) businesses.
F. The City Council is authorized to impose general and special taxes in order to fund municipal services and facilities, subject to requisite voter approval as set forth in Government Code section 53720 et seq.
G. The voters of the City of Santa Ana approved Measure Y (Ordinance No.
NS-2962) on November 6, 2018, for the purpose of fixing the rate of tax ation for commercial cannabis businesses including delivery, distribution, manufacturing, cultivation, testing and retail sales of cannabis and related products. The taxes required to be paid under this article are declared to be required pursuant to the taxing power of the City of Santa Ana solely for the purpose of obtaining revenue and are not regulatory permit fees.
H. On September 3, 2019, the City Council adopted Ordinance No. NS-2972 amending certain sections of chapters 21 of the Santa Ana Municipal Code allowing vertical and horizontal integration of cannabis businesses; updating ownership transfers procedural standards and requirements, security deposits, and various administrative processes; updating and streamlining regulatory components; reducing cannabis testing taxes to greater amount of one (1%) percent of gross receipts or $1.50 per square foot ; and adopting a canopy measurement and square footage allocation service fee.
I. The City of Santa Ana desires to remain at the forefront of commercial cannabis by allowing and regulating commercial cannabis business activities, routinely updating and amending its ordinances, and establishing commercial cannabis gross receipts tax rates and square footages tax rates that are competitive and provide for the needs of the Santa Ana community.
J. The City of Santa Ana has a compelling interest in ensuring that cannabis is not sold in an illicit manner, in protecting the public health, safety and welfare of its residents and businesses, in preserving the peace and quiet of the neighborhoods in which these businesses may operate, and in providing access to safe and tested cannabis to residents. To ensure safe and tested cannabis, the City desires to see the establishment and successful operation of cultivation, distribution, and manufacturing (including shared manufacturing and microbusiness) facilities in the City.
K. Section 21-133(d) of Article XIII of Chapter 21 of the Santa Ana Municipal Code establishes initial, current, and scheduled commercial cannabis gross receipts tax
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and square footage tax rates by reference to the authorizing ordinances and resolutions, the content of which are presented in condensed tabular format as follows:
Commercial Cannabis Business
Activity
Gross Receipts Tax
Rate
Gross Square
Footage Tax Rate
Adult-use Cannabis Retail Business
(including Delivery) (effective
beginning December 21, 2018
through December 31, 2022)
8% $ 25.00
Adult-use Cannabis Retail Business
(including Delivery, but not including
Consumption Lounge and
Temporary Consumption and/or
Special Events)
(effective beginning January 1, 2023)
7% $ 25.00
Adult-use Cannabis Retail Business
(including Delivery and Consumption
Lounge)
(effective beginning January 1, 2023)
7% $ 25.00
Adult-use Cannabis Retail Business
(Temporary Consumption and/or
Special Events)
(effective beginning January 1, 2023)
7% $ 0.00
Qualified Social Equity Adult-use
Cannabis Retail Business (including
Delivery and Consumption Lounge)
(effective beginning January 1, 2023)
5% $ 25.00
Qualified Social Equity Adult-use
Cannabis Retail Business (Temporary
Consumption and/or Special Events)
(effective beginning January 1, 2023)
5% $ 0.00
Cultivation
(effective December 21, 2018
through December 31, 2022)
6% $ 10.00
Cultivation
(effective beginning January 1, 2023) 1% $ 7.00
Distribution
(effective December 21, 2018
through December 31, 2022)
6% $ 4.00
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Distribution
(effective beginning January 1, 2023) 1% $ 3.00
Manufacturing
(effective December 21, 2018
through December 31, 2022)
6% $ 10.00
Manufacturing
(effective beginning January 1, 2023) 1% $ 3.00
Shared Manufacturing
(effective beginning January 1, 2023) 1% $ 0.00
Testing Facility or Testing Laboratory
(effective December 21, 2018
through June 30, 2019)
5% $ 1.50
Testing Facility or Testing Laboratory
(effective July 1, 2019) 1% $ 1.50
L. Section 21-133(b)(2) of Article XIII of Chapter 21 of the Santa Ana Municipal Code allows the City Council by resolution to implement any lower commercial cannabis tax rate it deems appropriate.
Section 2. The City Council hereby establishes: (1) the adult-use cannabis retail business (including delivery, but not including consumption lounge and temporary consumption and/or special events) gross receipts tax rate at seven (7%) percent, lowering it from eight (8%) percent; (2) the adult-use cannabis retail business (including delivery and consumption lounge) and the adult-use cannabis retail business (temporary consumption and/or special events) gross receipts tax rates at seven (7%) percent; and (3) the qualified social equity adult -use cannabis retail business (including delivery and consumption lounge) and the qualified social equity adult -use cannabis retail business (temporary consumption and/or special events) gross receipts tax rates at five (5%) percent. The reduced seven (7%) percent gross receipts tax rate for adult-use cannabis retail business (including delivery, but not including consumption lounge and temporary consumption and/or special events), and the (7%) percent gross receipts tax rates for adult-use cannabis retail business (including delivery and consumption lounge) and adult- use cannabis retail business (temporary consumption and/or special events), plus the five (5%) percent qualified social equity adult-use cannabis retail business (including delivery and consumption lounge) and qualified social equity adult -use cannabis retail business (temporary consumption and/or special events) activities shall all become effective January 1, 2023.
Section 3. The City Council hereby establishes: (1) the square footage tax rates for adult-use cannabis retail business (including delivery, but not including consumption lounge and temporary consumption and/or special events), plus adult-use cannabis retail
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business (including delivery and consumption lounge), together with qualified social equity adult-use cannabis retail business (including delivery and consumption lounge) business activities at twenty-five ($25) dollars per square foot; (2) the square footage tax rates for adult-use cannabis retail business (temporary consumption and/or special events) and qualified social equity adult-use cannabis retail business (temporary consumption and/or special events) activities at zero ($0) dollars per square foot . The (1) twenty-five ($25) dollars per square foot , square footage tax rates for adult-use cannabis retail business (including delivery, but not including consumption lounge and temporary consumption and/or special events), plus adult -use cannabis retail business (including delivery and consumption lounge), together with qualified social equity adult-use cannabis retail business (including delivery and consumption lounge) business activities; and (2) the zero ($0) dollars per square foot, square footage tax rates for adult-use cannabis retail business (temporary consumption and/or special events) and qualified social equity adult -use cannabis retail business (temporary consumption and/or special events) activities shall all become effective January 1, 2023.
Section 4. The City Council hereby establishes : (1) the commercial c annabis cultivation gross receipts tax rate; (2) the manufacturing (including shared manufacturing) gross receipts tax rate; and (3) the distribution gross receipts tax rate at one (1%) percent.
The reduced one (1%) percent gross receipts tax rate for cultivation activities, manufacturing (including shared manufacturing) activities, and distribution activities shall become effective January 1, 2023.
Section 5. The City Council hereby establishes : (1) the commercial cannabis square footage tax rate for cultivation activities at seven ($7) dollars per square foot and for manufacturing activities at three ($3) dollars per square foot (lowering both from ten ($10) dollars per square foot); (2 ) the commercial cannabis square footage tax for distribution activities at three ($3) per square foot (lowering it from four ($4) per square foot); and (3) the shared manufacturing square footage tax at zero ($0) per square foot.
The reduced seven ($7) per square foot tax rate for cultivation activities , the reduced three ($3) per square foot tax rate for manufacturing activities, the reduced three ($3) per square foot tax rate for distribution ac tivities, and the zero ($0) per square foot tax rate for shared manufacturing shall all become effective January 1, 2023.
Section 6. This Resolution, upon its adoption by the City Council, shall take effect January 1, 2023, and the Clerk of the Council shall attest to and certify the vote adopting this Resolution.
ADOPTED this ____ day of ___________________, 2022.
Vicente Sarmiento
Mayor
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Resolution No. 2022-XXX
APPROVED AS TO FORM:
Sonia R. Carvalho, City Attorney
By:
John M. Funk
Chief Assistant City Attorney
AYES:
Councilmembers
NOES: Councilmembers
ABSTAIN: Councilmembers
NOT PRESENT: Councilmembers _
CERTIFICATE OF ATTESTATION AND ORIGINALITY
I, ________, Clerk of the Council, do hereby certify the attached Resolution No. 2022-XXX to be the original resolution adopted by the City Council of the City of Santa Ana on _____________________, 2022.
Date:
Clerk of the Council
City of Santa Ana
City Council
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Resolution No. 2022-XXX
RESOLUTION NO. 2022-XXX
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
SANTA ANA REDUCING THE TAX ON MEDICINAL RETAIL
MARIJUANA BY ONE PERCENT, FROM SIX (6%) PERCENT
TO FIVE (5%) PERCENT
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SANTA ANA AS FOLLOWS:
Section 1. The City Council of the City of Santa Ana hereby finds, determines and declares as follows:
A. On November 4, 2014, Santa Ana voters approved Santa Ana's Medical Marijuana Regulatory Program ordinance ("Measure BB") allowing up to twenty (20) medical marijuana retail cannabis collectives/cooperatives ("dispensaries").
B. Following the adoption of Measure BB, the provisions of the measure were codified in Chapters 18 and 21 of the Santa Ana Municipal Code. The City also established an implementation plan, enforcement program, administrative policies, and best practices.
C. In May 2016 and early 2017, following initial implementation of the ordinance, the City held roundtable discussion s that invited stakeholders, dispensary owners, and members of the medical marijuana industry to meet with City staff regarding the implementation of Measure BB. Participants of the roundtable discussions voiced opinions on various aspects of the regulatory and tax programs and provided their recommendations for future policy level consideration.
D. On June 20, 2017, the City Council approved amendments to Chapter 18 to streamline Measure BB and create more business -friendly conditions for the existing collectives/cooperatives.
E. On November 17 , 2017, the City Council approved an ordinance amending Chapter 21, Article XII ( Marijuana Collectives/Cooperatives) and increasing the tax on medicinal retail marijuana dispensaries. Measure BB established an initial business license tax rate of up to five (5%) percent of the medicinal retail marijuana gross receipts generated from each dispensary, but authorized a maximum business license tax rate of up to ten (10%) percent. The November 17, 2017, ordinance (NS-2930) increased the tax from the initial Measure BB voter approved rate of five percent (5%) to six percent (6%) as permitted by Measure BB.
F. Section 21-127 (b) of Article XII of Chapter 21 of the Santa Ana Municipal Code allows the City Council by resolution to implement any lower or higher tax rate it deems
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appropriate not greater than the business license tax rate of up to ten (10%) percent authorized by Measure BB.
Section 2. T he City Council hereby establishes the marijuana collectives/cooperatives gross receipts tax rate at five (5) percent, lowering it from six (6) percent. The five (5%) percent gross receipts tax rate shall become effective January 1, 2023.
Section 3
. This Resolution, upon its adoption by the City Council, shall take effect January 1, 2023, and the Clerk of the Council shall attest to and certify the vote adopting this Resolution.
ADOPTED this ____ da y of ___________________, 2022.
Vicente Sarmiento
Mayor
APPROVED AS TO FORM:
Sonia R. Carvalho, City Attorney
By:
John M. Funk
Chief Assistant City Attorney
AYES:
Councilmembers
NOES:
Councilmembers
ABSTAIN:
Councilmembers
NOT PRESENT:
Councilmembers _
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Resolution No. 2022-XXX
CERTIFICATE OF ATTESTATION AND ORIGINALITY
I, __________________, Clerk of the Council, do hereby certify the attached Resolution No. 2022 - _____ to be the original resolution adopted by the City Council of the City of Santa Ana on _____________________, 2022.
Date:
Clerk of the Council
City of Santa Ana
City Council
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Resolution No. 2022-XXX
RESOLUTION NO. 2022-XXX
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
SANTA ANA ESTABLISHING: (1) A MAP OF COMMERCIAL
CANNABIS ELIGIBLE AREAS IN WHICH COMMERCIAL
CANNABIS BUSINESSES AS DEFINED AND REGULATED
BY CHAPTERS 21 AND 40 OF THE SANTA ANA MUNICIPAL
CODE MAY OPERATE; (2) THE NUMBER OF ANNUALLY
PERMISSIBLE TEMPORARY CONSUMPTION EVENTS;
AND ( 3) TH E COMMUNITY BENEFIT, SUSTAINABLE
BUSINESS PRACTICES, AND SOCIAL EQUITY PLAN
TEMPLATE
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SANTA ANA AS FOLLOWS:
Section 1. The City Council of the City of Santa Ana hereby finds, determines, and declares as follows:
A. On December 9, 2014, following voter approval, the City Council adopted Ordinance No. NS-2864 to regulate the establishment, operation, and taxation of medical marijuana collectives and cooperatives in the City. The ordinance was originally known as and subsequently became referred to as “Measure BB.”
B. In November 2016, the California Marijuana Legalization Initiative, also known as the Adult Use of Marijuana Act (AUMA or Proposition 64) was approved by the voters of the State of Californi a. The AUMA legalized specified personal use and cultivation of marijuana for adults 21 years of age or older.
C. In 2017, the Governor signed into law Senate Bill 94, also known as Medicinal and Adult -Use Cannabis Regulation and Safety Act (MAUCRSA) , establishing state regulations and licensing for retail sales, manufacturing, distribution, delivery and testing of adult-use (also called recreational) marijuana.
D. On November 21, 2017, the City Council adopted Ordinance No. NS-2929, creating Chapter 40 of the Santa Ana Municipal Code and allowing adult-use commercial cannabis retail businesses in the city, and amended certain sections of Chapters 18 and 21 of the Santa Ana Municipal Code to ensure consistency with State law and Chapter
40. Since 2014, the City has allowed medicinal marijuana collectives/cooperatives to operate within the City pursuant to regulations set forth in Chapter 18 and Chapter 21 of the Santa Ana Municipal Code.
E. Since its inception, Chapter 40 has required all commercial cannabis business operators to engage in providing community benefits and sustainable business
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practices through execution of an operating agreement and accompanying Community Benefit and Sustainable Business Practices plan, with the intent of ensuring commercial cannabis businesses remain engaged in providing direct benefits to the Santa Ana community.
F. In 2018, the City Council adopted Ordinance Nos. NS-2941 and NS-2942, allowing and regulating commercial cannabis testing laboratories, and Ordinance No. NS- 2944, allowing commercial cannabis cultivation, manufacturing, and distribution activities.
G. The City of Santa Ana desires to remain at the forefront of commercial cannabis by allowing and regulating commercial cannabis business activities, routinely updating and amending its ordinances, and establishing commercial cannabis gross receipts tax rates that are competitive and provide for the needs of the Santa Ana community.
H. Measure BB and subsequent ordinances specified that commercial cannabis business activity is permitted in the City’s light and heavy industrial zoning districts (M1 and M2) and must be located 1,000 feet from schools, parks, and properties zoned for residential uses. Proposition 64 subsequently set a minimum separation of 600 feet but allowed local jurisdictions to adopt lower or higher separation requirements.
I. The City Council recognizes those entities that have remained on the Medicinal Cannabis Waitlist pursuant to Santa Ana Municipal Code Section 40 -104, and those entities that were scored as part of the merit-based selection process in Section 40-
9. J. Following redevelopment of industrial properties east of the Costa Mesa (SR-55) Freeway, the City Council adopted a map of commercial cannabis eligible areas on March 20, 2018 in which commercial cannabis business activities could locate subject to full compliance with applicable local, County, and State regulations.
K. Since the last adoption of the map, the increasing demand for industrial properties in Santa Ana following the COVID-19 pandemic has reduced the availability of commercial cannabis eligible properties in the industrial zoning districts, creating strain on cannabis business applicants, other business types, tenants, and property owners. In order to offer clarity and expansion opportunities to commercial cannabis business owners, the City desires to update the map to specify the exact parcels on which commercial cannabis business activities are permitted. The map is based on the original 1,000-foot buffer from sensitive land uses, including schools, parks, and residential zoning districts.
L. The City of Santa Ana desires to maintain commercial cannabis businesses in locations adequately buffered from sensitive land uses such as schools, parks, and properties zoned for residential uses, while maintaining a sufficient amount of properties eligible to apply for and operate a commercial cannabis business.
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Resolution No. 2022-XXX
M. The City of Santa Ana has a compelling interest in ensuring that cannabis is not sold in an illicit manner, in protecting the public health, safety and welfare of its residents and businesses, in preserving the peace and quiet of the neighborhoods in which these businesses may operate, and in providing access to safe, locally produced and retailed, and tested cannabis to residents and visitors.
N. The rise in commercial cannabis business activity in California, coupled with an increase in consumer base both Citywide and regionally, requires the City to adopt a proactive approach to allowing and regulating commercial cannabis business activity, including ensuring that consumers of commercial cannabis retail products are educated in responsible consumption and have safely designed and monitored settings in which retail cannabis may be purchased and consumed.
O. The City Council has held a duly noticed public hearing on September 20 , 2022 in connection with consideration and adoption of this resolution, during which comments were provided by the City Council and members of the public on additional retail storefronts, reduction of retail tax rates, community benefits and social equity, the map of commercial cannabis eligible areas, and priority processing for commercial cannabis consumption lounges that opt in to social equity measures.
Section 2. Pursuant to the California Environmental Quality Act (“CEQA”) and the State CEQA Guidelines, the adoption of the accompanying ordinance and accompanying resolutions is exempt from further CEQA analysis pursuant to CEQA Guidelines Section 15061(b)(3), as the proposed amendments address business activities already permitted in the City and will not result in any significant physical effect on the environment. Because Santa Ana is a built-out, urbanized community, and the uses permitted and regulated by the cannabis ordinance are already allowed by the underlying zoning designations and the development standards in Chapter 41 (Zoning) of the Santa Ana Municipal Code, the updates to the ordinance will not lead to any cumulative or unforeseen impacts. A Notice of Exemption, Environmental Review (ER) No. 2022-15, was filed for these actions within five days of first reading, which took place on September 20, 2022.
Section 3. T
he City Coun cil hereby establishes the map of commercial cannabis eligible areas, included here as Attachment A, and referenced in Santa Ana Municipal Code Sections 40- 2, 40-5, and 40-6. This map reflects the original 1,000-foot distance from properties containing schools, parks, and properties zoned for residential uses, and includes eligible properties in the Light Industrial (M1), Heavy Industrial (M2), and select Specific Development and Professional zoning districts of an industrial nature, but is now parcel-specific to offer clarity to property and business owners.
Section 4. The City Council hereby establishes the maximum number of temporary consumption events, as defined by Santa Ana Municipal Code Section 40- 2 (39.2) and regulated by Santa Ana Municipal Code Section 40- 8 (11), as two (2) per commercial cannabis retail business per calendar year.
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Resolution No. 2022-XXX
Section 5
. The City Council hereby adopts the Community Benefit, Sustainable Business Practices, and Social Equity Plan template, attached hereto as Attachment B.
Section 6
. This Resolution shall take effect upon the effectiveness of Ordinance No. NS-____ on January 1, 2023.
A
DOPTED this ____ day of ___________________, 2022.
Vicente Sarmiento
Mayor
APPROVED AS TO FORM:
Sonia R. Carvalho, City Attorney
By:
John Funk
Chief Assistant City Attorney
AYES:
Councilmembers
NOES: Councilmembers
ABSTAIN: Councilmembers
NOT PRESENT: Councilmembers
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Resolution No. 2022-XXX
CERTIFICATE OF ATTESTATION AND ORIGINALITY
I, _____________________, Clerk of the Council, do hereby certify the attached Resolution No. 2022 - _____ to be the original resolution adopted by the City Council of the City of Santa Ana on _____________________, 2022.
Date:
Clerk of the Council
City of Santa Ana
City Council
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10/4/2022
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EUCLID ST
BRISTOL ST
EDINGER AV
SUNFLOWER AV
WARNER AV
RED HILL AV
HARBOR BLVD
RAITT ST
RAITT ST
WARNER AV
1ST ST
1ST ST 1ST ST
SEGERSTROM AV
FAIRVIEW
ST
FAIRVIEW ST
BRISTOL ST
MAIN ST
MAIN ST
ALTON AV
EDINGER AV
EDINGER AV
DYER
RD
MC FADDEN AV
MC FADDEN AV
GRAND AV
DYER RD
FLOWER ST
FLOWER ST
WARNER AV
MACARTHUR BLVD
MACARTHUR BLVD
BROADWAY
BROADWAY
Map 3
Map 1
Map 2
Heritage
Elem
Russell
Elem
Newhope
Elem
MacArthur
Fundamental
Intmd
Jackson
Elem
Fitz Intmd
Lincoln
Elem
Adams
Elem
Cesar E.
Chavez High
Harvey Elem
Century High
Diamond Elem
Franklin
Elem
Edward B.
Cole
Academy
Carr
Intmd
Greenville
Fundamental Elem
Godinez
Fundamental
High School
Madison
Elem
Jefferson
Elem
ThorpeFundamental
Kennedy
Elem
Lorin
Griset
Academy
Sepulveda
Elem
Lathrop
Intmd
Lowell
Elem
McFadden
Intmd
Martin
Elem
Esqueda Elem
King
Elem
Heninger
Elem
Monte
Vista
Elem
Monroe
Elem
Edison
Elem
Villa
Fundamental
Intmd
Pio
Pico
Elem
Saddleback
High
Santa
Ana
High
Segerstrom
High
Taft
Elem
Roosevelt
Elem Walker
Elem
Valley High
Washington
Elem
Mitchell Child
Development
Center
Saint
Anne
Saint
Barbara
Elem
Mater Dei
High School
Calvary
Chapel High
Maranatha
Christian
Academy
Ari Guiragos
Minassian
Armenian
Bethel
Baptist
School of
Our Lady
Adams
Park
Angels
Community Park Birch Park
Bomo
Koral
Park
Centennial
Regional
Park
Delhi
Park
Friendship
Park
Heritage
Park
Jerome
Park
Lillie
King
Park
Madison
Park
McFadden
Triangle
Park
Memorial
Park
Myrtle
& Raitt
(Proposed)
Neal
Machander
Tennis Center
Pacific
Electric
Park
Sandpointe
Park
Santa
Ana Zoo at
Prentice Park
Santa
Anita
Park
Segerstrom
Triangle ParkCarl
Thornton
Park
Windsor
Park
Roosevelt
Community
Center Park
Familias Corazones
Verdes Park
McFadden/
Standard Field
Maple
Occidental
Exercise Park
Note: final verification of eligible applications will be based on information provided via written communication for renewals or for new registration applications.
I
Map Creation Date: 9/13/2022
City of Santa Ana - GIS Section 1000 ft Buffer
Commercial Cannabis Business
(Medicinal & Adult-Use)
Zoning Index Map
0 ½ 1
Miles
Legend
Schools
Parks
1000 ft Buffer from Schools, Parks, and Residential
Eligible Parcels
M1 - Light Industrial
M2 - Heavy Industrial
P - Professional
Specific Developments (SD8, SD69, SD74, SD85)
Note: If the buffer touches or crosses through a portion of an existing building, the entire building remains eligible.
Attachment A
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SEGERSTROM AV
WARNER AV
FAIRVIEW ST
MACARTHUR BL
SUNFLOWER AV
HARBOR BL
Harvey Elem
Godinez
Fundamental
High School
Thorpe
Fundamental
Segerstrom
High
Valley
High
Mitchell Child
Development
Center
Calvary
Chapel High
Maranatha
Christian
Academy
Greenville
FundamentalElementary
Centennial
Regional
Park
Legend
Schools
Parks
1000 ft Buffer from Schools, Parks, and Residential
Eligible Parcels
M1 - Light Industrial
M2 - Heavy Industrial
P - Professional
Specific Developments (SD8, SD69, SD74, SD85)
Note: final verification of eligible applications will be based on information provided via written communication for renewals or for new registration applications.
Commercial Cannabis Retail
(Medicinal & Adult-Use)
Zoning Availability Map 1 of 3
Note: No Adult-Use cannabis retail business shall be located within 500 feet of another retail cannabis business, except for permitted co-location. 1000 ft Buffer
I
0 500 1,000
Feet
Map Creation Date: 9/13/2022
City of Santa Ana - GIS Section
Note: If the buffer touches or crosses through a portion of an existing building, the entire building remains eligible.
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MAJESTIC
DR
PARTON
AV
HARVEY
AV
MACARTHUR PL
AURORA AV
VAN NESS AV
BIRCH ST
ALPINE AV
PARTON AV
BELL AV
KELLER AV
KELLER AV
CENTRAL AV
WILLIS ST
BLAIR AV
GOETZ AV
CENTRAL AV
BELL AV
GARNSEY ST
ALPINE AVALPINE AV
ALPINE AV
TIMBER ST
TIMBER ST
OLIVE ST
OLIVE ST
OLIVE ST
OLIVE ST
OLIVE ST
HUTTON
CENTRE DR
SIERRA AV
CURIE AV
JUNIPER AVJUNIPER AV
ORANGE AV
BIRCH ST
BIRCH ST
BIRCH ST
BIRCH ST
BINE
ALTON AV
KELLER AV
KELLER AV
TIMBER ST
TIMBER ST
RITCHEY ST
RITCHEY ST
COLUMBINE AV
STANELY
KILSON DR
DAIMLER ST
DAIMLER ST
DAIMLER ST
LYON ST
FIRST AMERICAN WY
FIRST AMERICAN WY
FLORA ST
FLORA ST
NOBEL AV
NOBEL AV
HICKORY ST
HALLADAY ST
HALLADAY ST
HALLADAY ST
HALLADAY ST
CARNEGIE AV
JUNIPER
OAK ST
OAK ST
OAK ST
ALDER ST
CENTRAL AV
CENTRAL AV
CAROL AV
CAROL AV
PL
PL
STEVENS AV STEVENS AV
STEVENS AV
GOETZ AV
DEERE AV
HARVEY AV
MAPLE ST
MAPLE ST
COLUMBINE AV
COLUMBINE AV
LOWELL ST
LOWELL ST
LOWELL ST
LOWELL ST
DURYEA AV
SIERRA
SIERRA
WRIGHT ST
PARTON ST
GARRY AV
GARRY AV
PULLMAN
CYPRESS AV
CYPRESS AV
ROSS ST
ROSS ST
ROSS ST
PULLMAN ST
PULLMAN ST
PULLMAN ST
STANDARD AV
ROUSSELLE ST
AV
AV
AV
AV
AV
AVAV
AV
AV
AV
AV
AV
AV
AV
CARRIAGE DR
CATHERINE WY
HATHAWAY ST
ANAHURST PL
ST
ST
ST
ST
ADAMS STADAMS ST
EMMETT ST
GARNSEY ST
GARNSEY ST
GARNSEY ST
MURPHY AV
ORANGE AV
ORANGE AV
SY
CAMORE
ST
YOUNG ST
EVERGREEN ST
EVERGREEN ST
BROADWAY PL
ORION
ORION
MACARTHUR PL
SYCAMORE ST
SYCAMORE ST
PASTEUR
TOWNER ST
TOWNER ST
TOWNER ST
TOWNER ST
TOWNER ST
BROWNING
STEVENS
SANDPOINTE
WOODLAND AV
TEAKWOOD ST
WOODLAND PL
RAMONA DR
RAMONA DR
RAMONA DR
RAMONA DR
MCGAW AV
BRADFORD
MACARTHUR
ROSSAURORA AURORAAURORA
BROADWAY
MURPHY
COLUM
MEASOR
ROWLAND
COWAN
MAYWOOD
MACARTHUR PL
WARNER AV
RED HILL AV
WARNER AV
MAIN ST
ALTON AV
DYER
RD
DYER RD
FLOWER ST
MACARTHUR BLVD
COSTA MESA (55) FWY
MacArthur
Fundamental
Intmd
Esqueda Elem
Monroe
Elem
SaddlebackHigh
TaftElem
Washington
Elem
BomoKoralPark
Delhi
Park
Lillie
King
Park
Sandpointe
Park
SegerstromTriangle Park
Note: final verification of eligible applications will be based on information provided via written communication for renewals or for new registration applications.
Commercial Cannabis Retail
(Medicinal & Adult-Use)
Site Availability Map 2 of 3
Note: No Adult-Use cannabis retail business shall be located within 500 feet of another retail cannabis business, except for permitted co-location. 1000 ft Buffer
Legend
Schools
Parks
1000 ft Buffer from Schools, Parks, and Residential
Eligible Parcels
M1 - Light Industrial
M2 - Heavy Industrial
P - Professional
Specific Developments (SD8, SD69, SD74, SD85)
I
0 500 1,000
Feet
Map Creation Date: 9/13/2022
City of Santa Ana - GIS Section
Note: If the buffer touches or crosses through a portion of an existing building, the entire building remains eligible.
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?sE
WARNER AV
WARNER AV
EDINGER AV
MC FADDEN AV
GRAND AV
Century HighMadison
Elem
KennedyElem
VillaFundamentalIntmd
RooseveltElem
WalkerElem
DelhiPark
MadisonPark
SantaAna Zoo atPrentice ParkRooseveltCommunityCenter Park McFadden/Standard Field
MapleOccidentalExercise Park
Note: final verification of eligible applications will be based on information provided via written communication for renewals or for new registration applications.
Commercial Cannabis Retail
(Medicinal & Adult-Use)
Zoning Availability Map 3 of 3
Note: No Adult-Use cannabis retail business shall be located within 500 feet of another retail cannabis business, except for permitted co-location. 1000 ft Buffer
I
0 500 1,000
Feet
Map Creation Date: 9/13/2022
City of Santa Ana - GIS SectionLegend
Schools
Parks
1000 ft Buffer from Schools, Parks, and Residential
Eligible Parcels
M1 - Light Industrial
M2 - Heavy Industrial
P - Professional
Specific Developments (SD8, SD69, SD74, SD85)
Note: If the buffer touches or crosses through a portion of an existing building, the entire building remains eligible.
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This Plan is a public record.
Note: This is not a Regulatory Safety Permit (RSP) to legally operate a Commercial Cannabis Business. DO NOT O
PERATE unless a valid RSP is issued.
Commercial Cannabis Business
Community Benefit, Sustainable Business
Practices, and Social Equity Plan
Planning and Building Agency
Planning Division
20 Civic Center Plaza
P.O. Box 1988 (M-20)
Santa Ana, CA 92702
(714) 647-5804
www.santa-ana.org
Section 1: Business Information
Table 1
Item Information
Business Information
Business Legal Name
Business Doing Business As (DBA)
Business Address in Santa Ana
Regulatory Safety Permit (RSP) No.
RSP Issuance Date
RSP Expiration Date
Business Owner Name
Contact Information
Primary Contact Person Name
Primary Contact Person Phone
Primary Contact Person Email
Section 2: Community Benefit, Sustainable Business Practices, and Social Equity Plan
Pursuant to Santa Ana Municipal Code (SAMC) Section 40-1(C), all commercial cannabis businesses operating in Santa Ana are required to maintain a Community Benefit, Sustainable Business Practices, and Social Equity Plan ( “Plan”) on file with the City in a format acceptable to the Executive Director of the Planning and Building Agency. Failure to maintain a plan and satisfy the obligations specified therein will result in review and possible suspension, revocation, citation, or other enforcement action. For more information on the City’s requirements for Community Benefit, Sustainable Business Practices, and Social Equity, please review SAMC Section 40-1(C).
B
eginning January 1, 2023, all commercial cannabis businesses are required to commit to spending one-half of one percent (0.50%) of gross reported earnings for the previous reporting year towards community benefit, sustainable business practices, and social equity obligations. Beginning January 1, 2024, all commercial cannabis businesses are required to commit to spending one percent (1.00%) of gross reported earnings for the previous reporting year towards community benefit, sustainable business practices, and social equity obligations.
Attachment B
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This Plan is a public record.
Note: This is not a Regulatory Safety Permit (RSP) to legally operate a Commercial Cannabis Business. DO NOT OPERATE unless a valid RSP is issued.
Commercial Cannabis Business
Community Benefit, Sustainable Business
Practices, and Social Equity Plan
Planning and Building Agency
Planning Division
20 Civic Center Plaza
P.O. Box 1988 (M-20)
Santa Ana, CA 92702
(714) 647-5804
www.santa-ana.org
Required annual spending must be equitably distributed among the three Section categories described in Table 2 and is subject to review and approval by the City. A Plan that does not indicate satisfactory and equitably-distributed commitments will be rejected and corrections issued to the business owner. Approval and renewal of a Regulatory Safety Permit is contingent upon Plan approval.
Please utilize the following sections to detail the business’s commitments to community benefits, sustainable business practices, and social equity measures. If additional space is required, please attach supplemental sheets to this form using the same format as Table 2 of this packet.
Table 2
Item Frequency or
Timeframe
Equivalent
Monetary Value
Detailed Description of
Measure or Activity
Section 1: Community Benefits*
CB-1. Local hiring
(Required)1
CB-2. Local sourcing
(Required)2
CB-3. Contributions
to local charitable or
not-for-profit
organizations
(Required)3
1 Describe measures to hire managers, staff, volunteers from within the City of Santa Ana. Details shall be provided on local job posting methods, and annual data shall be provided indicating the means utilized to advertise jobs and on the amount of manager s, staff, and volunteers residing in Santa Ana. Beginning January 1, 2023, the cannabis retail business owner must demonstrate that twenty percent (20%) of its employees reside within the City of Santa Ana, then beginning January 1, 2024, the cannabis retail business owner must demonstrate that forty percent (40%) of its employees reside within the City of Santa Ana
2 Describe measures to obtain construction materials and inventory from within the City of Santa Ana. Details shall be provided on local posting methods, and annual data shall be provided indicating the means utilized to source locally from businesses in Santa Ana.
3 Describe measures to engage with local charitable or not-for-profit organizations located within Santa Ana or carrying out operations in Santa Ana. Measures may include volunteering, financial contributions, or material contributions.
Describe the frequency and value of all such contributions.
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This Plan is a public record.
Note: This is not a Regulatory Safety Permit (RSP) to legally operate a Commercial Cannabis Business. DO NOT OPERATE unless a valid RSP is issued.
Commercial Cannabis Business
Community Benefit, Sustainable Business
Practices, and Social Equity Plan
Planning and Building Agency
Planning Division
20 Civic Center Plaza
P.O. Box 1988 (M-20)
Santa Ana, CA 92702
(714) 647-5804
www.santa-ana.org
Item Frequency or
Timeframe
Equivalent
Monetary Value
Detailed Description of
Measure or Activity
Section 2: Social Equity Measures (Beginning January 1, 2025)** SE-1. Employment
compensation for full-
time employees
above minimum
wage (Required)4
SE-2. Measures to
hire part- and full-
time staff from
disadvantaged
communities
(Required)
5 SE-3. Expenditures
on safety-related
equipment, training,
and services
(Required)
6 4 Employment compensation for the full-time employees of the qualified taxpayer. For purposes of this Plan, “employment compensation” means wages paid to full -time employees who are paid no less than 115 percent (beginning January 1, 2024) and no less than 12 0 percent (beginning January 1, 2026) of the applicable minimum wage. The calculation of wages may include the monetary value to the full-time employee of employer-provided group health insurance benefits, childcare benefits, employer contributions to employer -provided retirement benefits, or employer contributions to pension benefits.
5 Includes measures that the business will take to recruit, hire, and retain employees who reside in low-income census tracts in Santa Ana where at least fifty-one percent (51%) of the current residents have a household income at or below eighty percent (80%) of the Orange County Area Median Income (AMI), or from Environmental Justice communities as specified by the General Plan.
6 For purposes of this Plan, “safety -related equipment, training, and services” means equipment primarily used by employees of cannabis licensees to ensure their personal and occupational safety or the safety of customers of the cannabis licensees; training for non-management employees on workplace hazards, including, but not limited to, training required pursuant to subparagraph (A) of paragraph (11) of subdivision (a) of Section 26051.5 of the California Business and Professions Code as amended from time to time; and services, including, but not limited to, safety audits, security guards, security cameras, and fire risk mitigation.
City Council
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161
10/4/2022
This Plan is a public record.
Note: This is not a Regulatory Safety Permit (RSP) to legally operate a Commercial Cannabis Business. DO NOT OPERATE unless a valid RSP is issued.
Commercial Cannabis Business
Community Benefit, Sustainable Business
Practices, and Social Equity Plan
Planning and Building Agency
Planning Division
20 Civic Center Plaza
P.O. Box 1988 (M-20)
Santa Ana, CA 92702
(714) 647-5804
www.santa-ana.org
Item Frequency or
Timeframe
Equivalent
Monetary Value
Detailed Description of
Measure or Activity
SE-4. Workforce
development and
safety training for
employees
(Required)7
Section 3: Sustainable Business Practices***
SP-1. Energy Saving
(Required)
SP-2. Water Saving
(Required)
*Additional measures are permissible, such as direct engagement with local charitable or not-for-profit organizations, volunteer activities, etc.
**Social equity measures are intended to result in improvements to disadvantaged communities, aiding those systemically and negatively affected by prior criminal or misdemeanor drug convictions, and creating new opportunities among owners, managers, employees, and other staff employed by the cannabis industry.
***Minimum “green” technologies such as energy and water saving measures are required. However, other measures are permissible, such as transit and carpool incentives, healthy living practices, etc.
7 Workforce development and safety training for employees of the qualified taxpayer. For purposes of this Plan, “workforce development” includes, but is not limited to, joint labor management training programs, membership in a joint apprenticeship training committee registered by the Division of Apprenticeship Standards, and a state-recognized high road training partnership as defined in Section 14005 of the California Unemployment Insurance Code as amended from time to time.
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10/4/2022
This Plan is a public record.
Note: This is not a Regulatory Safety Permit (RSP) to legally operate a Commercial Cannabis Business. DO NOT OPERATE unless a valid RSP is issued.
Commercial Cannabis Business
Community Benefit, Sustainable Business
Practices, and Social Equity Plan
Planning and Building Agency
Planning Division
20 Civic Center Plaza
P.O. Box 1988 (M-20)
Santa Ana, CA 92702
(714) 647-5804
www.santa-ana.org
Section 3: Acknowledgement
I, ____________________, primary contact for ____________________, business owner for the commercial cannabis business named ____________________, located at ________________________________________________________ in Santa Ana, California, hereby acknowledge that the information presented on this Community Benefit, Sustainable Business Practices, and Social Equity Plan is accurate and enforceable by the City of Santa Ana pursuant to Chapter 40 of the Santa Ana Municipal Code as a condition of Regulatory Safety Permit issuance, renewal, and maintenance of the Regulatory Safety Permit in good standing. I also understand that documentation of gross reported annual earnings from the prior reporting year and satisfaction of these commitments is required as part of the annual Regulatory Safety Permit renewal process.
____________________ ____________________
Primary Contact Date
Signature
____________________ ____________________
Business Owner Date
Signature
Approved:
____________________ ____________________ ____________________ Executive Director Executive Director Date
Name Signature
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10/4/2022
Exhibit 6
Recommended Commercial Cannabis Tax Rate Adjustments Table Commercial Cannabis Business Activity Gross Receipts
Tax Rate
Gross Square Footage
Tax Rate
Adult-use Cannabis Retail Business (including Delivery) (effective beginning December 21, 2018 through December 31, 2022) 8% $ 25.00 Adult-use Cannabis Retail Business (including Delivery, but not including Consumption Lounge and Temporary Consumption
and/or Special Events) (effective beginning January 1, 2023) 7% $ 25.00
Adult-use Cannabis Retail Business (including Delivery and Consumption Lounge)
(effective beginning January 1, 2023)
7% $ 25.00
Adult-use Cannabis Retail Business (Temporary Consumption and/or Special Events)
(effective beginning January 1, 2023)
7% $ 0.00
Qualified Social Equity Adult-use Cannabis Retail Business (including Delivery and Consumption Lounge)
(effective beginning January 1, 2023)
5% $ 25.00
Qualified Social Equity Adult-use Cannabis Retail Business (Temporary Consumption and/or Special Events)
(effective beginning January 1, 2023)
5% $ 0.00
Cultivation
(effective December 21, 2018 through December 31, 2022) 6% $ 10.00 Cultivation
(effective beginning January 1, 2023) 1% $ 7.00
Distribution
(effective December 21, 2018 through December 31, 2022) 6% $ 4.00 Distribution
(effective beginning January 1, 2023) 1% $ 3.00
Manufacturing
(effective December 21, 2018 through December 31, 2022) 6% $ 10.00
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Exhibit 6
Note:
• Shared manufacturers work in a shared-use facility operated by a commercial cannabis manufacturer. Shared manufacturers can:
o Extract cannabis using butter or cooking oils
o Make cannabis products through infusion
o Package and label cannabis
• Microbusiness are a single commercial cannabis businesses license type allowing for at least three of the following activities at one location:
1. Cultivation – up to 10,000 total square feet
2. Manufacturing – use of non-volatile solvents, mechanical extraction, or infusion
3. Distribution or distribution transport-only
4. Adult Use Retail – storefront or non-storefront. ‡
‡ - Santa Ana restricts retail to storefront retail, and only for pre -existing adult use retailers seeking to expand into a microbusiness.
Manufacturing
(effective beginning January 1, 2023) 1% $ 3.00
Shared Manufacturing
(effective beginning January 1, 2023) 1% $ 0.00
Microbusinesses
(Tax rates apply proportionally to microbusiness’ activities corresponding to Adult-use Retail [Adult-use Retail (including Delivery)] / Cultivation / Manufacturing / Distribution) (effective October 4, 2019 through December 31, 2022)
Adult-use Retail
8%
Cultivation,
Distribution &
Manufacturing
6%
Adult-use Retail
$ 25.00
Cultivation &
Manufacturing
$ 10.00
Distribution
$ 4.00
Microbusinesses†
(Tax rates apply proportionally to microbusiness’ activities corresponding to Adult-use Retail [Adult-use Retail (including Delivery, but not including Consumption Lounge and Temporary Consumption and/or Special Events)] / Cultivation / Manufacturing / Distribution)
(effective beginning January 1, 2023)
† Note: $2,000 Basic Tax Rate assessment to be reduced for microbusinesses to a single levy on a microbusiness’ dominant gross receipts activity.
Adult-use Retail
7%
Cultivation,
Distribution &
Manufacturing
1%
Adult-use Retail
$ 25.00
Cultivation
$ 7.00
Distribution &
Manufacturing
$ 3.00
Testing Facility or Testing Laboratory
(effective December 21, 2018 through June 30, 2019) 5% $ 1.50 Testing Facility or Testing Laboratory
(effective July 1, 2019) 1% $ 1.50
City Council
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City Manager Office
www.santa-ana.org/city-managers-office
Item # 23
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
October 4, 2022
TOPIC: Sister Cities
AGENDA TITLE:
Adopt a Resolution Establishing a Sister City Relationship with Sahuayo, Michocan, Mexico
RECOMMENDED ACTION:
Adopt a resolution proclaiming the establishment of an educational, cultural, and business affiliation with the City of Sahuayo of the state of Michoacán of the United Mexican States.
BACKGROUND:
At the request of Mayor Sarmiento, staff has prepared a resolution establishing a Sister City affiliation with the City of Sahuayo of the State of Michoacán of the United Mexican States (“Mexico”).
About Sister Cities Programs
The term “sister cities”, also referred to as “twin towns”, is used generally to refer to a form of agreement between two geographically and politically distinct localities for the purpose of promoting commercial, cultural, and economic ties. “Sister city” programs became popular in the United States in 1956 when former U.S. President Dwight D.
Eisenhower proposed a citizen diplomacy initiative, Sister Cities International. While Sister Cities International originated as a program of the National League of Cities, it has since become its own entity. Although Sister Cities International is not the only mechanism to establish “sister city” relationships between cities, it is popular among cities wishing to do so.
The City of Santa Ana currently does not operate a Sister Cities program.
About Sister Cities International
Sister Cities International (SCI) is a nonprofit organization that serves as the national membership organization for individual sister cities across the United States. According to Sister Cities International, a sister city relationship is an abroad-based, long-term partnership between two communities in two different countries. Elected officials from
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Sister Cities
October 4, 2022
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9 5
both communities sign off on an agreement to become sister cities. A city may have any number of sister cities, with community involvement ranging from a half dozen to hundreds of volunteers. In addition to volunteers, sister city organizations can include representatives from nonprofits, municipal governments, the private sector, and other civic organizations. Each sister city organization can partake in youth, education, arts, cultural, trade, government, and community development exchanges.
Examples of Sister Cities Outside of Sister Cities International Below are examples of cities launching their own Sister Cities Program.
Garden Grove Sister City Association
The City of Garden Grove and Anyang have had a Sister City relationship since 1989. A student exchange program began in 1991, in hopes of expanding cultural knowledge among youth in the community. The Garden Grove Sister City Association is a nonprofit corporation used to connect GG with cities in foreign countries. The organization works closely with the City.
Buena Park Sister City Foundation
In 2017, the City of Buena Park and Seongbuk officiated a relationship. The purpose of the Buena Park Sister City Foundation is to focus on cross-cultural interpretation at a local level. The first official student exchange program was part of the inauguration in 2017.
The foundation prioritizes itself with bringing in new perspectives, so both cites can learn and thrive together.
Sister Cities of Long Beach Inc.
In 1996, Long Beach City Council passed a resolution to form an umbrella organization called Sister Cities of Long Beach Inc. (SCLB). Through this initiative, Long Beach has successfully brought together the international communities they served. SCLB is a nonprofit focused on further developing and executing projects in regards to the current and future sister cities of Long Beach.
Next Steps
The City Council has the discretion to adopt or not adopt the attached resolution (Exhibit 1) establishing a sister city affiliation with the City of Sahuayo of the State of Michoacán of the United Mexican States (“Mexico”). If the City Council adopts the resolution, staff will review best practices for implementing the sister city affiliation and will return to the City Council with additional information, if directed to do so.
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Sister Cities
October 4, 2022
2 9
9 5
ENVIRONMENTAL IMPACT
There is no environmental impact associated with this action.
FISCAL IMPACT
There is no fiscal impact associated with this action.
EXHIBIT(S)
1. Resolution
Submitted By: Kristine Ridge, City Manager
Approved By: Kristine Ridge, City Manager
City Council
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Resolution No. 2022-XXX
RESOLUTION NO. 2022- XXX
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
SANTA ANA PROCLAIMING THE ESTABLISHMENT OF AN
EDUCATIONAL, CULTURAL, AND BUSINESS AFFILIATION
WITH THE CITY OF SAHUAYO OF THE STATE OF
MICHOACÁN OF THE UNITED MEXICAN STATES
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SANTA ANA AS FOLLOWS:
Section 1. The City Council of the City of Santa Ana hereby, finds, determines and declares as follows:
A. The City of Santa Ana (the “City”) seeks to establish, promote and encourage friendship, goodwill and charity and promote educational, cultural, environmental and business exchanges between the citizens of Santa Ana and the City of Sahuayo of the State of Michoacán of the United Mexican States.
B. Common ties of mutual interests exist between the City and the City of Sahuayo.
C. The exchange of said interests and cultures by the mutual establishment of a “Sister City” relationship with City of Sahuayo will enhance the quality of life for the City and its residents.
D. Given that such relationships are forged between citizen-volunteers of both cities, it is hoped that such an affiliation will encourage and promote common understanding and goodwill among the citizens of both cities.
E. The City looks forward to continuing to develop the Sister City relationship and collaborating on future exchanges between the two cities.
Section 2. The City Council of the City of Santa Ana hereby approves the establishment of a Sister City affiliation with the City of Sahuayo of the State of Michoacán of the United Mexican States for the purpose of encouraging friendship and goodwill and promoting educational, cultural, environmental and business exchanges between both cities.
Section 3. The City Manager, or his or her designee, is hereby authorized and directed to execute any required documents or agreements consistent with this Resolution in furtherance of the sister city affiliation with the City of Sahuayo of the State of Michoacán of the United Mexican States.
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Resolution No. 2022-XXX
Section 4. This Resolution shall take effect immediately upon its adoption by the City Council, and the Clerk of the Council shall attest to and certify the vote adopting this Resolution.
ADOPTED this ______ day of ______________, 2022.
_______________________
Vicente Sarmiento
Mayor
APPROVED AS TO FORM:
Sonia R. Carvalho, City Attorney
By:________________________
Jose Montoya
Assistant City Attorney
AYES: Councilmembers _______________________________________ NOES: Councilmembers _______________________________________ ABSTAIN: Councilmembers _______________________________________ NOT PRESENT: Councilmembers _______________________________________
CERTIFICATE OF ATTESTATION AND ORIGINALITY
I, ______________, Clerk of the Council, do hereby attest to and certify the attached Resolution No. 2022-XXX to be the original resolution adopted by the City Council of the City of Santa Ana on _______________.
Date: ________________ ____________________________________ Clerk of the Council
City of Santa Ana
City Council
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Clerk of the Council Office
www.santa-ana.org/departments/clerk-of-the-council/
Item # 24
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
October 4, 2022
TOPIC: OCMVCD Member Appointment
AGENDA TITLE:
Appoint Member to the Orange County Mosquito and Vector Control District’s Board of Trustees
RECOMMENDED ACTION
Select a member to the Orange County Mosquito and Vector Control District’s Board of Trustees and appoint for the current term expiring in January 1, 2024.
DISCUSSION
The Mayor and City Council represent the City’s interest in regional issues by serving on a number of regional boards which make public policy decisions in the areas of transportation, water resources, fire services, government facilities, and vector control. In 2017, the City Council appointed Cecilia Aguinaga, a resident, to represent the City of Santa Ana on the Orange County Vector Control. In 2019, the City Council reappointed Ms. Aguinaga to the current term expiring January 1, 2024. Ms. Aguinaga resigned the Board effective August 2022, therefore staff is requesting to see if there is any interest from any member of the Council to serve the remaining term on the Orange County Mosquito and Vector Control District’s Board of Trustees.
Orange County Mosquito and Vector Control District’s Board of Trustees Position Summary
Responsibilities
The mission of the Orange County Mosquito and Vector Control District is to educate and protect Orange County from vectors and prevent vector-borne diseases in an environmentally responsible manner. The District is composed of a 35 member Board of Trustees, consisting of one member from each Orange County city and one member from the county at large.The Board of Trustees is responsible for the overall governance of District, including setting District policy, approving the annual budget, establishing strategic goals and objectives, and being an advocate for the District. The District Manager oversees the day-to-day operations of the District and carries out the policy objectives of the Board.
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OCMVCD Member Appointment
October 4, 2022
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For additional information on the OC Mosquito and Vector Control budget, programs, and services visit their website at www.ocvector.org
Minimum Requirements
Must be a registered voter and not serve as a treasurer of a political action committee.
Term of Appointment
This appointment will be completing a current term of a Trustee that resigned from the position and will end January 1, 2024.
Meetings
The Board of Trustees meets at 3:00 p.m. on the third Thursday of every month at the Orange County Mosquito and Vector Control District headquarters located at 13001 Garden Grove Blvd, Garden Grove, CA 92843
Compensation
$100 per regular board meeting.
ENVIRONMENTAL IMPACT
There is no environmental impact associated with this action.
FISCAL IMPACT
There is no fiscal impact associated with this action.
Submitted By: Norma Orozco, Acting Assistant Clerk of the Council Approved By: Kristine Ridge, City Manager
City Council
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2 10/4/2022
Community Development Agency
www.santa-ana.org/cd
Item # 25
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
October 4, 2022
TOPIC: Rent Stabilization and Just Cause Eviction Ordinances AGENDA TITLE:
Adoption of Ordinance amending the Rent Stabilization and Just Cause Eviction Ordinances
RECOMMENDED ACTION
Approve first reading of the Ordinance amending the Rent Stabilization and Just Cause Eviction Ordinances.
DISCUSSION
On September 6, 2022, City Council adopted the Long-Term Implementation Plan for the Rent Stabilization and Just Cause Eviction Ordinances (Exhibit 1). City Council also authorized the City Manager and City Attorney to begin drafting amendments to the Rent Stabilization and Just Cause Eviction Ordinances based upon the Long-Term Implementation Plan. Following this direction, the redline version of the amended Ordinance is attached to this Staff Report as Exhibit 2. [The Rent Stabilization Ordinance and Just Cause Eviction Ordinance were previously two separate Ordinances in the Santa Ana Municipal Code. For the sake of convenience, the Ordinances have been combined into one as the “Rent Stabilization and Just Cause Eviction Ordinance”.] The amendments to the Ordinance adheres to the Long-Term Implementation Plan and the direction by City Council at the September 6, 2022 meeting. At the September 6, 2022 meeting, City Council directed staff to:
1. Revise the Rental Housing Board composition.
2. Rental Registry Fee:
a. Keep the rental registry fee as low and lean as possible; present all options in the Fee Study; supportive of 50% pass through to tenants.
3. Add voluntary mediation:
a. Incorporate some form of voluntary mediation into the ordinance only at the request of tenants or landlords.
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Rent Stabilization and Just Cause Eviction Ordinances
October 4, 2022
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4. Compliance:
a. Add a penalty for landlords who do not register units in the rental registry and prohibit rent increases if the rental unit registration is not complete.
5. Remove the following exemptions from the ordinance:
a. “Housing restricted by deed, regulatory restriction contained in an agreement with a government agency, or other recorded document as affordable housing for persons and families of very low, low, or moderate income, as defined in Section 50093 of the Health and Safety Code, or subject to an agreement that provides housing subsidies for affordable housing for persons and families of very low, low, or moderate income, as defined in Section 50093 of the Health and Safety Code or comparable federal statutes.”
b. “The provisions of this ordinance regulating the amount of rent that a residential real property Owner may charge shall not apply to residential real property in which each of the units have been substantially rehabilitated within the previous 15 years. For purposes of this section,” substantially rehabilitated" shall mean that the cost to rehabilitate the residential real property was at least $40,000 per unit.”
Where the Long-Term Implementation Plan or City Council was silent on specific areas of the Ordinance, staff incorporated language that seeks to fulfill the spirit and intent of City Council.
The Rental Housing Board was the only item where staff did not have clear direction.
Rental Housing Board
On September 6, 2022, City Council agreed that a Rental Housing Board (“Board”) should be appointed to conduct hearings on petitions and appeals, implement policies and procedures for the administration and enforcement of the Ordinance, and perform other duties as necessary. Staff originally recommended the Board to be made up of two (2) tenants, two (2) landlords, and three (3) at-large members with no financial interest.
During the discussion and deliberation of the Long-Term Implementation Plan at the September 6, 2022 City Council meeting, staff understood that the majority of the City Council wanted to change the makeup of the Board from what was recommended by staff. A few Councilmembers discussed making the representation of tenants greater than landlords, but staff did not hear a majority consensus. Staff also understood that there was a majority consensus to include representation of a mobilehome tenant in the composition of the Board. The amendments to the Ordinance include a Board with three (3) tenants (including one (1) mobilehome tenant), three (3) landlords, and one (1) at- large member with no financial interest. This recommendation aligns most closely with the research and findings identified in the Long-Term Implementation Plan. However, since this policy direction was not clear at the September 6, 2022 City Council meeting, staff recommends City Council to deliberate and discuss the desired composition of the Board.
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October 4, 2022
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RSG’s Long-Term Implementation Plan provides detailed information on the membership of Rental Housing Boards in other jurisdictions. These options are provided as Exhibit 3.
Other options for the composition of the Board includes:
Option # 1: Three (3) tenants (including one (1) mobilehome tenant), three (3) landlords, and one (1) at-large member with no financial interest; Option # 2: Four (4) tenants (including one (1) mobilehome tenant), two (2) landlords, and one (1) at-large member with no financial interest; Option # 3: Three (3) tenants (including one (1) mobilehome tenant), two (2) landlords, and (2) at-large members with no financial interest; or Option # 4: Two (2) tenants (including one (1) mobilehome tenant), two (2) landlords, and three (3) at-large members with no financial interest (original staff recommendation).
The draft amendment pertaining to the Rental Housing Board can be found in Division 5, Section 8-3180 of the amended Ordinance.
Additional Administrative Considerations
In addition to the foregoing, at the September 6, 2022 meeting the City Council discussed the following items that will be implemented in the Work Plan, Fee Study, and subsequent Policies and Procedures:
•Staff will ensure that the Fee Study accounts for the most efficient way to implement the Long-Term Implementation Plan. Specifically, the rental registry fee will be as low and lean as possible to not create an unnecessary burden on tenants and landlords; staff will seek to blend a hybrid of services between consultants and city staff; and staff will identify ways to build upon other existing services across the City to administer the ordinance. The Fee Study and rental registry fee will be guided by these principles.
•Staff will present the following options as it relates to the fees associated with a Fair Return Petition, Capital Improvement Petition, and Tenant Petition:
oFinancial impact of having petition fees separate from the rental registry fee; oFinancial impact of having petition fees included in the rental registry fee; or oFinancial impact of having no petition fees.
•Staff will work in collaboration with the City’s Code Enforcement Division and City Attorney’s Office to enforce the ordinance.
Next Steps
Following City Council approval of the first reading of the Ordinance amending the Rent Stabilization and Just Cause Eviction Ordinances, staff will incorporate City Council feedback and return for a second reading of the Ordinance.
FISCAL IMPACT
There is no fiscal impact associated with this action.
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Rent Stabilization and Just Cause Eviction Ordinances
October 4, 2022
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EXHIBITS
1. September 6, 2022 Staff Report with the Long-Term Implementation Plan for the Rent Stabilization and Just Cause Eviction Ordinances
2. Redline version of the Ordinance amending the Rent Stabilization and Just Cause Eviction Ordinances
3. Options for the Composition of the Rental Housing Board Submitted By: Steven A. Mendoza, Assistant City Manager Approved By: Kristine Ridge, City Manager
City Council
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Ordinance No. NS - ____
ORDINANCE NO. NS-XXXX
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY
OF SANTA ANA AMENDING ARTICLE X OF CHAPTER 8
OF THE SANTA ANA MUNICIPAL CODE AND CREATING
A NEW ARTICLE XIX IN CHAPTER 8 OF THE SANTA ANA
MUNICIPAL CODE PERTAINING TO THE RENT
STABILIZATION AND JUST CAUSE EVICTION
ORDINANCES
THE CITY COUNCIL OF THE CITY OF SANTA ANA DOES ORDAIN AS FOLLOWS:
Section 1. The City Council of Santa Ana hereby finds, determines , and declares as follows:
A. At the City Council meetings on September 21, 2021, and October 5, 2021, the City Council discussed the City of Santa Ana's ("Santa Ana" or "City") ability to address rent increases on residential real property and in mobilehome parks.
B. On October 19, 2021, the City Council adopted Ordinance No. NS - 3009, known as the Rent Stabilization Ordinance (“RSO”) and Ordinance No. NS -3010, known as the Just Cause Eviction Ordinance (“JCEO”) appearing as Article X, Division 4 and Division 5 in the Santa Ana Municipal Code ( “SAMC”). The RSO and JCEO were adopted to regulate rent increases and evictions in certain rental properties and mobilehome spaces in the City of Santa Ana.
C. The findings in Ordinance No. NS - 3009 and Ordinance No. NS -3010 articulate that significant rent increases and housing instability pose a threat to public health, safety and welfare, and a particular hardship for senior citizens, persons living on fixed incomes, and other vulnerable persons living in Santa Ana. These findings are still true and incorporated herein.
D. Additionally, the Ci ty Council adopted Resolution No. 2021 - 054, directing staff to: (1) Conduct further study of the additional regulatory framework and infrastructure necessary to implement residential rent stabilization, just cause eviction, and other protections for Santa Ana residents facing housing instability; and, (2) Include the creation and operation of a Rent Board or similar body, a rent registry, and the related costs thereof.
E. On September 6, 2022, staff presented the Long -Term Implementation Plan for the RSO and JCEO to the City Council detailing various best practices based on findings from local sample jurisdictions with similar ordinances in the State of California.
EXHIBIT 2
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Ordinance No. NS - ____
F. On September 6, 2022, the City Council adopted the Long -Term Implementation Plan for the RSO and JCEO and provided direction to staff to prepare amendments to the RSO and JCEO to implement efficient and effective program services to rental property owners and tenants and promote long -term sustainability of the programs.
G. The amendments pro posed by this Ordinance are consistent with the adopted Long-Term Implementation Plan of the RSO and JCEO and the direction by City Council at the September 6, 2022 City Council meeting. These include:
1. Create a Rental Housing Board;
2. Create a Rental Registry;
3. Adopt a Rental Registry Fee;
4. Develop a Work Plan;
5. Conduct a Fee Study Based on the Work Plan and Staffing Needs;
6. Expand Compliance Activities;
7. Create a Capital Improvement Petition and Tenant Petition;
8. Establish Petition Fees and a Petition Review Process;
9. Create a Voluntary Mediation Process; and,
10. Join the Rent Stabilization Consortium.
H. Pursuant to the City's police power, as granted broadly under Article XI, section 7 of the California Constitution, and Santa Ana Ch arter section 200, the Santa Ana City Council has the authority to enact and enforce ordinances and regulations for the public peace, health, and welfare of the City and its residents.
I. The City Council finds, determines and declares that the threat to the public health, safety and welfare of the City and its residents necessitates the enactment of the Ordinance.
J. The Request for City Council Action for amendments to these Ordinances dated October 4, 2022, shall, by this reference, be incorporated herein, and together with this O rdinance, any amendments or supplements, and oral testimony, constitute the necessary findings for this Ordinance.
Section 2. The recitals and statements of fact set forth in the preamble to this Ordinance are true and cor rect, constitute a substantive part of this O rdinance, and are incorporated herein by this reference.
Section 3. Divisions 4 and 5 of Article X (Property Maintenance) of Chapter 8 (Buildings and Structures) of the Santa Ana Municipal Code are hereby amended and moved to a new Article XI X (Rent and Evictions ) of Chapter 8 of the Santa Ana Municipal Code to read as follows:
ARTICLE XIX. – RENT STABILIZATION AND JUST CAUSE EVICTION ORDINANCE
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DIVISION 1. – GENERALLY
Section 8-3100 – Title
This Article shall be known in its entirety as the “City of Santa Ana Rent Stabilization and Just Cause Eviction Ordinance” and, for the sake of convenience, as the “Rent Stabilization and Just Cause Eviction Ordinance.”
Section 8-3101 – Background
The Rent Stabilization Ordinance, previously adopted by the City Council on October 19, 2021, and the Just Cause Eviction Ordinance, also previously adopted by the City Council on October 19, 2021, are hereby amended pursuant to this newly adopted Rent Stabilization and Just Cause Eviction Ordinance.
Section 8-3102 – Definitions
a) For purposes of this Article, the words and phrases shall be defined as set forth herein, unless the context clearly indicates a different meaning is intended.
b) Words and phrases used in this Article, which are not specifically defined, shall be construed according to their context and the customary usage of the language.
c) Words and phrases defined:
“Annual Allowable Rent Adjustment” means the limit on the Maximum Allowable Rent increase, which a Landlord may charge on any Rental Unit each year.
“Capital Improvement” means an improvement, addition or major repair to a Rental Unit that were paid for and completed after November 19, 2021 (the effective date of the first adopted Rent Stabilization Ordinance), provided such new improvement, addition or major repair has a useful life of five (5) years or more and that is required to be amortized over the useful life of the improvement, such as: structural, electrical, plumbing, or mechanism system, roofing, carpeting, draperies, stuccoing the outside of a building, air conditioning, security gates, swimming pool, sauna or hot tub, fencing, children’s play equipment permanently installed, the complete exterior painting of a building, and other similar improvements as defined under the straight line depreciation provisions of the Internal Revenue Code and the regulations issued pursuant thereto and determined by the Rental Housing Board. Capital Improvement does not include normal or routine maintenance, repair, replacements, and/or deterioration resulting from an unreasonable delay in the undertaking of EXHIBIT 2
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completion or after a Notice of Violation by a government agency ordering repairs.
“City” means the City of Santa Ana.
"Hearing Officer” means a person who has been appointed by the Program Administrator to perform the duties set forth in this Article.
“Housing Services” means those services provided and associated with the use or occupancy of a Rental Unit including, but not limited to, insurance, repairs, replacement, maintenance, effective waterproofing and weather protection, painting, providing light, heat, hot and cold water, elevator service, window shades and screens, laundry facilities and privileges, janitorial services, utilities that are paid by the Landlord, refuse removal, allowing pets, telephone, parking, storage, the right to have a specified number of Tenants or occupants, computer technologies, entertainment technologies, including cable or satellite television services, and any other benefits, privileges or facilities connected with the use or occupancy of such Rental Unit including a proportionate share of the services provided to common facilities of the building in which such Rental Unit is located and/or of the property on which such Rental Unit is located.
“Landlord” or “Owner” means an owner of record, lessor, sublessor or any person, partnership, corporation, family trust, or any other business entity, or any successor in interest thereto, offering for rent or lease any Rental Unit or Mobilehome or Mobilehome Space in a Mobilehome Park in the City and shall include the employee, agent or representative of the Landlord if the agent or representative has the full authority to answer for the Landlord and enter into binding agreements on behalf of the Landlord.
"Mediator” means a person whom the Program Administrator determines meets all of the following criteria:
1) Has received at least twenty-four (24) hours of formal training in mediation; and,
2) Has mediated Rent disputes and/or has had other experience or training showing a capability to mediate the issues which arise in landlord/tenant disputes.
“Mobilehome” means a structure designed for human habitation and for being moved on a street or highway under permit pursuant to Section 35790 of the Vehicle Code. Mobilehome includes a manufactured home, as defined in Section 18007 of the Health and Safety Code, and a Mobilehome, as defined in Section 18008 of the Health and Safety Code, but does not include a recreational vehicle, as defined in Section 799.29 of this code and Section 18010 of the Health and Safety Code or a EXHIBIT 2
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commercial coach as defined in Section 18001.8 of the Health and Safety Code.
“Mobilehome Space” means the rental of a spot for a Mobilehome within a Mobilehome Park by a homeowner, as defined in Civil Code section 798.9, or a resident, as defined in Civil Code section 798.11.
“Mobilehome Park” means an area of land where two or more Mobilehome Spaces are rented, or held out for rent, to accommodate Mobilehomes used for human habitation.
“Net Operating Income” means the net revenue received by the Landlord after paying the normal Operating Expenses (gross revenue less normal operating expenses).
“Operating Expenses” means the costs of normal operations, including, but not limited to, management, taxes, insurance, maintenance, repairs and other recurring costs.
“Program Administrator” is a person designated by the City Manager to administer the provisions of this Article.
“Rental Registry Fee” or “Fee” means the fee the City imposes on each Rental Unit to cover the costs to administer the provisions of this Article.
“Rent” means all periodic compensation, including all non-monetary consideration, that a Tenant provides to a Landlord concerning the use or occupancy of a Rental Unit, including any amount included in the Rent for utilities (unless separately billed to the Tenant by the utility company), parking, storage, pets or for any other fee or charge associated with the tenancy for the use or occupancy of a Rental Unit and related Housing Services. Rent includes, without limitation, the fair market value of goods accepted, labor performed, or services rendered. With respect to Mobilehomes and Mobilehome Spaces in Mobilehome Parks, any regulations of rent, fees, and costs included within the Mobilehome Residency Law, Civil Code section 798, et seq., shall be incorporated into the definition of Rent, as applicable.
“Rent Increase” means any additional Rent demanded of or paid by a Tenant for a Rental Unit, including any reduction in Housing Services without a corresponding reduction in the amount demanded or paid for Rent; or a pro rata increase in costs of Housing Services apportioned to a Rental Unit.
“Rental Agreement” means a lease, sublease, or other agreement, written, oral or implied, between a Landlord and a Tenant for the use and/or EXHIBIT 2
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occupancy of a Rental Unit and for Housing Services. With respect to Mobilehomes and Mobilehome Spaces in Mobilehome Parks, any regulations of rental agreements or leases within the Mobilehome Residency Law, Civil Code section 798, et seq., shall be incorporated into the definition of Rental Agreement, as applicable.
“Rental Housing Board” or “Board” means the Rental Housing Board established by Division 5 of this Article XIX of Chapter 8 of the Santa Ana Municipal Code.
“Rental Registry” means the database or portal where Landlords register Rental Units, update Rental Unit information, update Tenancy information, submit notices, and pay the Rental Registry Fee.
“Rental Unit” means any building, structure, or part thereof, or any Mobilehome and Mobilehome Spaces in a Mobilehome Park, offered or available for rent for residential use or occupancy in the City, including the land appurtenant thereto, together with all Housing Services in connection with the use or occupancy thereof, including common areas and recreational facilities held out for use by the Tenant, which is not exempt pursuant to the exemptions set forth in this Article.
“Residential Real Property” or “Residential Property” means any housing unit, including a room or group of rooms designed and intended for occupancy by one or more persons, including a Rental Unit and a Mobilehome or Mobilehome Space in a Mobilehome Park, offered for rent or lease in the City.
“Tenancy" means the right or entitlement of a Tenant to use or occupy a Rental Unit, including a Mobilehome or Mobilehome Space in a Mobilehome Park.
“Tenant” means any renter, tenant, subtenant, lessee, sub-lessee, roommate with Landlord’s consent, or any other person or entity entitled under the terms of a Rental Agreement, or by sufferance, or by state or federal law, to the use or occupancy of any Rental Unit and (i) has the legal responsibility for the payment of Rent for a Rental Unit or (ii) has agreed to pay the Rent for a Rental Unit.
Section 8-3103 – Implementing Regulations, Policies and Procedures
The City Manager or Program Administrator shall have the authority to promulgate regulations, policies and procedures to implement the requirements and fulfill the purposes of this Article. No person shall fail to comply with such regulations, policies and procedures.
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DIVISION 42. – JUST CAUSE EVICTIONS
Section 8-1993 – Citation.
This Division shall be known as the “Just Cause Eviction Ordinance.”
Section 8-19943120 – Restrictions on Termination of Tenancy Wwithout Just Cause
(a) Notwithstanding any other law, a After a tenant has continuously and lawfully occupied a residential real property for thirty (30) days, the Owner of the residential real property shall not terminate the Tenancy without just cause, which shall be stated in t he written notice to terminate T enancy.
The provisions of this section related to the termination of Tenants shall not apply to Mobilehomes or Mobilehome Spaces in Mobilehome Parks subject to the termination provisions of the Mobilehome Residency Law, Civil Code section 798.56, as applicable.
1) The Owner shall post a notice on a form prescribed by the City, providing information about the existence of this Division 42 of Article XIX of Chapter 8 of the Santa Ana Municipal Code , including protections related to immigration or citizenship status of tenant found under Civil Code section 1940.35 and Code of Civil Procedure section 1161.4, as may be amended. Notice must be posted in a conspicuous location on the property. The notice shall be written in the language that the Owner and tenant used to negotiate the terms of the Tenancy (e.g., Spanish, Chinese, Tagalog, Vietnamese and Korean ), as well as English.
2) In addition to all other notice requirements specified elsewhere in this Division, the Owner of any residential real property or mobilehome space, is required to provide written notice to tenants of their rights under this Division as follows:
A. The notice required by this Division must be on a form prescribed by the City and include the following information:
i. The existence and scope of this Division 42 of Article XIX of Chapter 8 of the Santa Ana Municipal Code; and,
ii. The right to relocation assistance in limited
circumstances pursuant to subsection (d)(2) herein.
B. The Owner must provide tenant with the notice upon serving any notice of change in terms of Tenancy.
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C. The Owner must provide the notice on or before the
commencement of all Tenancies initiated after the effective date of this Division.
(b) For purposes of this section, “just cause” includes either of the following:
1) At-fault just cause, which is any of the following:
A. Default in the payment of rent.
B. A breach of a material term of the lease, as described in paragraph (3) of Section 1161 of the Code of Civil Procedure , including, but not limited to, violation of a provision of the lease after being issued a written notice to correct the violation. A “breach of a material term” shall not include:
i. The obligation to limit occup ancy, provided that the additional occupant who joins the tenant of the residential real property thereby exceeding the limits on occupancy set forth in the lease is:
I. A dependent under age 18, or
II. A replacement tenant who moved in after an
approved tenant vacated the residential real
property, so long as the addition does not exceed
the Uniform Housing Code.
i. The Owner shall have the right to approve
or deny the prospective additional or
replacement tenant, who is not a minor
dependent child, provided tha t the Owner
does not unreasonably withhold approval. If
the Owner fails to respond to the tenant in
writing with a description of the reasons for
the denial of the request within a
reasonable amount of time of receipt of the
tenant’s written request, the tenant’s
request shall be deemed approved by the
Owner if the lease is for a period of one (1)
year or less.
ii. A change in the terms of the Tenancy that is not the result of an express written agreement signed by both of the parties. An Owner is not required to obtain a tenant’s EXHIBIT 2
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written consent to a change in the terms of the Tenancy if the change in the terms of the Tenancy is authorized by this section, or if the Owner is required to change the terms of the Tenancy pursuant to federal, State, or local law. Nothing in this subsection shall exempt a n Owner from providing legally required notice of a change in the terms of the Tenancy.
C. Maintaining, committing, or permitting the maintenance or commission of a nuisance as described in paragraph (4) of Section 1161 of the Code of Civil Procedure.
D. Committing waste as described in paragraph (4) of Section 1161 of the Code of Civil Procedure.
E. The tenant had a written lease that terminated on or after the effective date of this Ordinance , and after a writ ten reques t or demand from the O wner, the tenant has refused to execute a written extension or renewal of the lease for an additional term of similar duration with similar provisions, provided that those terms do not violate this section or any other provision of law.
F. Criminal activity by the tenant on the residential real property, including any common areas, or any criminal activity or criminal threat, as defined in subdivision (a) of Section 422 of the Penal Code, on or off the residential real pro perty, that is directed at any Owner or agent of the Owner of the residential real property or members of tenant’s household or other tenants of the residential real property . This at-fault, just cause provision shall apply if the Owner has, within a reasonable time, rep orted the criminal activity to law enforcement. Further, at -fault, just cause eviction of a tenant under this provision shall only apply to that tenant who committed the criminal activity described herein. If a tenant is acquitted or found not guilty of th e charges giving rise to eviction, or if charges are not filed against the tenant within the applicable statute of limitations period , the tenant shall be offered the right to restore the Tenancy only if the same residential real property is available.
G. Assigning or subletting the premises in violation of the tenant’s lease, as described in paragraph (4) of Section 1161 of the Code of Civil Procedure.
i. Notwithstanding any contrary provision in this section, an Owner shall not take any action to terminate a Tenancy
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based on a tenant’s sublease of the residential real
property if all the following requirements are met:
I. The tenant requests permission from the Owner in
writing to sublease the residential real property;
II. The tenant continues to reside in the residential
real property as their primary residence;
III. The sublease replaces one or more departed
tenants under the lease on a one -for-one basis;
and
IV. The Owner fails to respond to the tenant in writing within a reasonable amount of time of the receipt
of the tenant’s written request. If the Owner fails to
respond to the tenant’s written request, the
request shall be deemed approved by the Owner if
the lease is for a period of one (1) year or less . An
Owner’s reasonable refusal of the tenant’s written
request may be based on, but is not limited to, the
ground that the total number of occupants in a
residential real property exceeds the maximum
number of occupants as determined under Section
503(b) of the Uniform Housing Code or successor
provision.
H. The tenant’s refusal to allow the O wner to enter the residential real property as authorized by Sections 1101.5 and 1954 of the Civil Code , and Sections 13113.7 and 17926.1 of the Health and Safety Code.
I. Using the premises for an unlawful purpose as described in paragraph (4) of Section 1161 of the Code of Civil Procedure.
J. The employee, agent, or licensee’s failure to vacate after their termination as an employee, agent, or a licensee as described in paragraph (1) of Section 1161 of the Code of Civil Procedure.
K. When the tenant fails to deliver possession of the residential real property after p roviding the O wner written notice as provided in Section 1946 of the Civil Code of the tenant’s intention to terminate the hiring of the real property, or makes a written o ffer to surrender that is accepted in writing by the Owner but fails to deliver possession at the time specified in that EXHIBIT 2
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written notice as described in paragraph (5) of Section 1161 of the Code of Civil Procedure.
2) No-fault just cause, which includes any of the following:
A.
i. Intent to occupy the re sidential real property by the Owner or their spouse, domestic partner, children,
grandchildren, parents, or grandparents.
ii. For leases entered into on or after the effective date of this Ordinance , this subsection shall apply only if the tenant agrees, in writing, to the termination, or if a
provision of the lease allows the O wner to terminate the lease if the O wner, or their spouse, domestic partner, children, grandchildren, parents, or grandparents
unilaterally decides to occupy the residential real property for a period of at least 24 months, as affirmed by the
Owner in a written affidavit submitted to the City. Addition of a provision allowing the O wner to terminate the lease as described in this clause to a new or renewed rental
agreement or fixed -term lease constitutes a similar
provision for the purposes of subparagraph ( E) of
paragraph (1).
B. Withdrawal of the residential real property from the rental market for a n anticipated period of at least 24 months, as affirmed by the Owner in a written affidavit submitted to the City.
C.
i. The Owner complying with any of the following:
I. An order issued by a government agency or court
relating to habitability that necessitates vacating
the residential real property.
II. An order issued by a government agency or court
to vacate the residential real property.
III. A local ordinance that necessitates vacating the
residential real property.
ii. If it is determined by any government agency or court that the tenant is at fault for the condit ion or conditions triggering the order or need to vacate under clause (i), EXHIBIT 2
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the tenant shall not be entitled to relocation assistance as outlined in paragraph (3) of subdivision (d).
D.
i. Intent to demolish or to substantially remodel the
residential real property.
ii.
I. The Owner shall provide advance notice to the
tenant of the ability to reoccupy the unit upon
completion of the repairs, or if requested by the
tenant, the right of first refusal to any comparable
vacant rental unit which has been offered at
comparable rent owned by the Owner; and
II. In the event the Owner seeks to rent the
remodeled unit within six (6) months following the
completion of the remodeling work, the evicted
tenant shall have the right of first refusal to
reoccupy and rent the unit , unless the Owner
provides a written waiver by the tenant of their
right to reoccupy the premises pursuant to this
subsection.
iii. For purposes of this subparagraph, “substantially
remodel” means the replacement or substantial
modification of any structural, electri cal, plumbing, or mechanical system that requires a permit from a
governmental agency, or the abatement of hazardous
materials, including lead -based paint, mold, or asbestos, in accordance with applicable federal, State, and local laws, that cannot be reas onably accomplished in a safe manner with the tenant in place and that requires the
tenant to vacate the residential real property for at least 30 days. Cosmetic improvements alone, including
painting, decorating, and minor repairs, or other work that can be performed safely without having the residential
real property vacated, do not qualify as a substantial
remodel.
(c) Before an Owner of residential real property issues a notice to terminate a Tenancy for just cause that is a curable lease violation , the Owner shall first give notice of the violation to the tenant with an opportunity to cure the violation pursuant to paragraph (3) of Section 1161 of the Code of Civil Procedure. If the violation is not cured within the time period set forth in EXHIBIT 2
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the notice, a t hree-day notice to quit without an opportunity to cure may thereafter be served to terminate the Tenancy.
1) Any written notice to cease or correct must:
A. Be dated and served upon the tenant, pursuant to at least one of the methods authorized under Californ ia Code of Civil Procedure Section 1162, as may be amended;
B. Inform the tenant that failure to cure may result in the initiation of eviction proceedings;
C. Inform the tenant of the right to request a reasonable accommodation;
D. Inform the tenant of the contact number for the Eviction Defense Fund or the Program Administrator City if no such fund exists ; and
E. Include a specific statement of the reasons for the written notice to cease or correct with specific facts to help the tenant determine the date(s), place (s), witness(es), and
circumstance(s) that support the reason(s) for the eviction.
(d)
1) For a T enancy for which just caus e is required to terminate the Tenancy under subdivision (a), if an O wner of residential real property issues a termination notice based o n a no-fault just cause described in paragraph (2) of subdivision (b) , the O wner shall, regardless of the tenant’s income, at the Owner’s option, do one of the following:
A. Assist the tenant to relocate by providing a direct payment to the tenant as described in paragraph 3; or
B. Waive in writing the payment of rent for the final three (3) months of the Tenancy, prior to the rent becoming due.
2) If an O wner issues a notice to terminate a T enancy for no -fault just cause, the O wner shall notify the tenant of the tenant’s right to relocation assistance or rent waiver and all other rights pursuant to this section. If the O wner elects to waive the rent for the final three (3) month of the T enancy as provided in subparagraph (B ) of paragraph (1), the notice shall sta te the amount of rent waived and that no rent is due for the final three (3) months of the Tenancy.
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3)
A. The amount of relocation assistance or rent waiver shall be equal to three (3) months of the tenant’s rent that was in effect when the O wner issu ed the no tice to terminate the T enancy.
Any relocation assistance shall be provided within 15 calendar days of service of the notice.
B. If a tenant fails to vacate after the expiration of the notice to terminate the T enancy, the actual amount of any relocation assistance or rent waiver provided pursuant to this subdivision shall be recoverable as damages in an action to recover possession.
C. The relocation assistance or rent waiver required by this section shall be credited against any other relocation assistance required by any other law.
4) An Owner’s failure to strictly comply with this section shall render the notice of termination void.
(e) This section shall not apply to the following types of residential real properties or residential circumstances:
1) Transient and to urist hotel occupancy as defined in subdivision (b) of Section 1940 of the Civil Code.
2) Housing accommodations in a nonprofit hospital, religious facility, extended care facility, licensed residential care facility for the elderly, as defined in Section 15 69.2 of the Health and Safety Code , or an adult residential facility, as defined in Chapter 6 of Division 6 of Title 22 of the Manual of Policies and Procedures published by the State Department of Social Services.
3) Dormitories owned and operated by an ins titution of higher education or a kindergarten and grades 1 to 12, inclusive, school.
4) Housing accommodations in which the tenant shares bathroom or kitchen facilities with the Owner who maintains their principal residence at the residential real property.
5) Single-family O wner-occupied residences, including a residence in which the Owner-occupant rents or leases no more than two units or bedrooms, including, but not limited to, an accessory dwelling unit or a junior accessory dwelling unit.
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6) A duplex in which the Owner occupied one of the units as the O wner’s principal place of res idence at the beginning of the Tenancy, so long as the Owner continues in occupancy.
7) Housing that has been issued a certificate of occupancy within the previous 15 years.
8) Residential real property that is alienable separate from the title to any other dwelling unit, provided that both of the following apply:
A. The Owner is not any of the following:
i. A real estate investment trust, as defined in Section 856 of the Internal Revenue Code.
ii. A corporation.
iii. A limited liability company in which at least one member is a corporation.
B.
i. The tenants have been provided written notice that the residential property is exempt from this section using the following statement: “This property is not subject to the just cause requirements of Santa Ana Municipal Code
Chapter 8, Article XIX, Division 42. This property meets the requirements of Santa Ana Municipal Code section 8- 19943120(e)(8) and the O wner is not any of the
following: (1) a real estate investment trust, as defined by Section 856 of the Internal Revenue Code; (2) a
corporation; or (3) a limited liability company in which at least one member is a corporation.”
ii. For a T enancy existing before the effective date of this Ordinance, the notice r equired under clause (i) may, but is not required to, be provided in the rental agreement.
iii. For any Tenancy commenced or renewed on or after the effective date of this Ordinance, the notice required under clause (i) must be provided in the rental agreement.
iv. Addition of a provision containing the notice required under clause (i) to any new or renewed rental agreement or fixed-term lease constitutes a similar provision for the purposes of subparagraph ( E) of paragraph (1) of
subdivision (b).
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9) Housing restric ted by deed, regulatory restriction contained in an agreement with a government agency, or other recorded document as affordable housing for persons and families of very low, low, or moderate income, as defined in Section 50093 of the Health and Safety Cod e, or subject to an agreement that provides housing subsidies for affordable housing for persons and families of very low, low, or moderate income, as defined in Section 50093 of the Health and Safety Code or comparable federal statutes.
(f) An Owner of resid ential real property subject to this section shall provide notice to the tenant as follows:
1) For any Tenancy commenced or renewed on or after the effective date of this Ordinance, as an addendum to the lease or rental agreement, or as a written notice sign ed by the tenant, with a copy provided to the tenant.
2) For a Tenancy existing prior to the effective date of this Ordinance, by written notice to the tenant no later than thirty (30) days after the effective date of this Ordinance , or as an addendum to the lease or rental agreement.
3) The notification or lease provision shall be in no less than 12 -point type, and shall include the following: “The Santa Ana Municipal Code provides that after all of the tenants have continuously and lawfully occupied the prope rty for at least thirty (30) days , a n Owner must provide a statement of caus e in any notice to terminate a T enancy.
See Division 42 of Article XIX of Chapter 8 of the Santa Ana Municipal Code for more information.”
(g) It shall be a defense to an action for p ossession of a rental unit under this Division if a trier of fact determines that:
1) Both of the following provisions apply:
A. The tenant or tenant’s household member is a victim of an act or acts that constitute domestic violence, elder or dependent adult abuse, sexual assault, human trafficking, or stalking if the domestic violence, elder or dependent adult abuse, sexual assault, human trafficking, or stalking has been documented by one of the following:
i. A temporary restraining order, emergency protective
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member from domestic violence, elder or dependent
adult abuse, sexual assault, human trafficking, or
stalking; or
ii. The tenant or a member of their household has filed a police report within the previous 180 days alleging that they are a victim of domestic violence, elder or
dependent adult abuse, sexual assault, human
trafficking, or stalking.
B. The notice to vacate is substantially based upon the act or acts constituting domestic violence, elder or dependent adult abuse, sexual assault, human trafficking, or stalking against the tenant or their household member, including , but not limited to , an action for possession based on complaints of nois e,
disturbances, or repeated presence of police.
2) Notwithstanding this Section, an Owner may terminate the Tenancy if:
A. The tenant or the person protected by a court order or who filed a police report allows the person against whom the protective order has been issued or who was named in the police report as committing an act of domestic violence, elder or dependent adult abuse, sexual assault, human trafficking, or stalking, to visit the rental property; or
B. The Owner reasonably believes the presence of the person against whom the protective order has been issued or who was named in the police report as having committed an act of domestic violence, elder or dependent adult abuse, sexual assault, human trafficking, or stalking poses a physical threat to other tenants, guests, invitees, or to a tenant’s right to quiet enjoyment and the Owner previously gave the tenant a three (3) day written notice to cease and correct this violation.
(h) It shall be a defense to a no fault just cause action for possession of a rental unit under this Division if a person under the age of 21 is a resident of the subject rental unit, or has a custodial or family relationship with a tenant in the subject rental unit, and who is registered and actively attending any level of school during a specified school term.
(i) Any sale of a mobilehome park shall be considered a change of use pursuant to Government Code section 65863.7. Accordingly, a At least sixty (60) days prior to the sale of a mobilehome park, the Owner shall provide notice of such proposed sale to the mobilehome park residents and prepare a report on the impact of the sale of the mobilehome park, EXHIBIT 2
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including a replacement and relocation plan that adequately mitigates the impact upon the ability of any displaced residents of the mobilehome park to be sold to find adequate housing in a mobilehome park, as applicable , pursuant to the requirements of Government Code section 65863.7.
(j) Any waiver of the rights under this section shall be void as contrary to public policy.
(k) For the purposes of this Division, the following definitions shall apply:
1) “Owner” and “residential real property” have the same meaning as those terms are defined in Civil Code Section 1954.51.
2) “Tenancy” means the lawful occupation of residential re al property or mobilehome space and includes a lease or sublease , as such may be subject to local ordinance pursuant to the terms of the Costa -Hawkins Rental Housing Act, California Civil Code section 1954.50. et seq., and the Mobilehome Residency Law, Civil Code section 798, et seq.
Section 8-19953121 – Notice of Termination of Tenancy.
(a) When terminating a T enancy either at-fault or n o-fault, an Owner must comply with all of the following:
1) The Owner must serve a written notice in accordance with Civil Code sections 1946 through 1946.5, to the t enant that states that, in addition to any information required by federal or State law, the Owner will terminate the Tenancy, and that indicates at least one at-fault or no- fault just cause reason as provided in section 8-19943120(b); and
2) The Owner has no t accepted and will not accept r ent or any other consideration in return for the continued use of the residential property beyond the term of the terminated Tenancy in compliance with Civil Code sections 1945 through 1946.5; and
3) The Owner qualifies the termination as at-fault or no-fault just cause, as specified in section 8-19943120(b); and
4) The Owner has submitted to the City, within five (5) days after service of the notice of termination on the t enant, a true and accurate copy of the Owner's written notice of termination, and proof of such service, signed under penalty of perjury, on the t enant, through the City’s Rental Registry portal. The Owner shall maintain proof of service to the City as evidence that the Owner has complied with this section.
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5) The Owner must provide the notice in the language that the Owner and tenant used to negotiate the terms of the Tenancy, in addition to English.
Section 8-19963122 – Retaliatory Eviction and Anti-Harassment.
(a) Retaliatory Eviction.
1) If the main intent of the Owner in terminating a Tenancy or refusing to renew a Tenancy is ret aliatory in nature, and if the t enant is not in default as to the payment of rent, then the Owner may not terminate the Tenancy or refuse to renew the Tenancy or cause the tenant to quit involuntarily.
2) A t enant may assert retaliation affirmatively or as a defense to the Owner’s action regardless of the period of time which has elapsed between the t enant's assertion or exercise of rights under thi s Article and the alleged act of retaliation.
3) Retaliation against a tenant because of the t enant's exercise of rights under this Article is prohibited. Retaliation claims may only be brought in court and may not be addressed administratively. A court may consider the protections afforded by this Article in evaluating a claim of retaliation.
(b) Anti-Harassment. No Owner, or any person, acting as a principal or agent, offering residential real property for rent, or any contractor, subcontractor or employee of the Owner shall, with respect to residential real property under any rental agreement or other Tenancy or estate at will, however created, do any of the following:
1) Interrupt, terminate, or fail to provide h ousing services required by rental agreement or by federal, State, County, or local housing, health, or safety laws, or threaten to do so, or violate or threaten to violate Civil Code section 789.3.
A. ‘Interrupt, terminate, or fail to provide housing services’ in this provision does not include inte rruptions, terminations, or failure to provide housing services as a result of interruptions, outages, or terminations caused by events or actions outside of the Owner’s control, such as utility outages caused by natural disaster. Further, this provision does not include stoppages, outages, terminations, and interruptions properly noticed to tenants as required by a signed rental agreement.
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2) Take any of the following actions in bad faith:
A. Fail to perform repairs and maintenance required by rental agreement or by federal, State, or local laws;
B. Fail to exercise due diligence in completing repairs and maintenance once undertaken;
C. Fail to follow appropriate industry repair, containment, or remediation protocols designed to minimize exposure to noise, dust, lead, paint, mold, asbestos, or other building materials with potentially harmful health impacts;
D. Conduct elective renovation or construction of unit for the purpose of harassing a tenant;
E. Refuse to acknowledge or accep t receipt of a t enant's lawful rent payment as set forth in a rental agreement, by usual practice of the parties, or in a notice to pay rent or quit;
F. Refuse to cash or process a rent che ck or other form of acceptable r ent payment for over thirty (30) days after it is tendered;
G. Fail to maintain a current address for delivery of rent payments;
H. Violate a t enant's right to privacy without limitation, by requesting information regarding residence or citizenship status, protected class status, or social security number, except as required by law or in the case of a social security number, for the purpose of obtaining information for the qualifications for a Tenancy;
I. Release information protected by the t enant's right to privacy except as required or authorized by law; or
J. Request or de mand an unreasona ble amount of information from t enant in response to a request for reasonable
accommodation.
3) Abuse the right of access into residential real property as established by Civil Code section 1954 or other applicable law. This includes entries for inspections that are not related to necessary repairs or services; entries excessive in number; entries that improperly target certain tenants or are used to collect evidence against the occupant or otherwise beyond the scope of an otherwise lawful e ntry; entries or EXHIBIT 2
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demands for entry at times outside of normal business hours, unless for health and safety reasons or if the t enant agrees otherwise; entries contrary to a tenant's reasonable request to change the date or time of entry; photographing or ot herwise recording portions of a rental unit that are beyond the scope of lawful entry or inspection; and misrepresenting the reasons for accessing residential real property.
4) Influence or attempt to influence a t enant to vacate residential real property through fraud, misrepresentation, intimidation or coercion, which shall include threatening to report a tenant to the United States Department of Homeland Security.
5) Threaten the tenant, by word or gesture , with physical harm, or abuse tenant with words, e ither orally or in writing, which are offensive and inherently likely to provoke an immediate violent reaction. This includes words used during in -person conversations, through social media postings or messages, or other communications.
6) Violate any law w hich prohibits discrimination based on race, gender, sexual preference, sexual orientation, ethnic background, nationality, religion, age, parenthood, marriage, pregnancy, disability, human immunodeficiency virus (HIV)/ acquired immune deficiency syndrome (AIDS), occupancy by a minor child, or source of income.
7) Take action to terminate any Tenancy including service of any notice to quit or other eviction notice or bring any action to recover possession of a rental unit based upon facts which the Owner has no reasonable cause to believe to be true or upon a legal theory which is untenable under the facts known to the Owner. No Owner shall be liable under this subsection for bringing an action to recover possession unless and until the tenant has obtained a favorable termination of that action.
8) Remove from the rental unit personal property, furnishings, or any other items without the prior written consent of the tenant, except when done pursuant to enforcement of a legal termination of Tenancy.
9) Provide false written or verbal information regarding any federal, State, County, or local Tenant protections, including mischaracterizing the nature or effect of a notice to quit or other eviction notice. False information includes, without limitation, requesting o r demanding a tenant:
A. Sign a n ew rental agreement not in the t enant's primary language if:
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i. rental agreement nego tiations were conducted in the tenant's primary language;
ii. The exist ing rental agreement is in the t enant's primary language; or
iii. Owner is otherwise aware that the new rental agreement is not in tenant's primary language.
B. Enter into a r ent repayment plan if the Owner states, misrepresents, suggests, or implies, that the tenant should or must do so to take advantage of t enant protection laws that do not in fact require such plans.
10) Offer payments to:
A. A tenant to vacate more than onc e in six (6) months, after the tenant has notified the Owner in writing that the t enant does not desire to receive further offers of payments to vacate;
B. Attempt to coerce t enant to vacate accompanied with threats or intimidation. This shall not include settlement offers in pending eviction actions made in good faith and not accompanied with threats or intimidation.
11) Communicate with t enant in a language other t han t enant's primary language for the purpose of intimidating, co nfusing, deceiving or annoying tenant.
12) Interfere with a tenant's right to quiet use and enjoyment of a rental unit as that right is defined by law.
13) Commit repeated acts or omissions of su ch significance as to substantially interfere with or disturb the comfort, repose, peace, or quiet of any person lawfully entitled to occupancy of such rental un it and that cause, are likely to cause, or are intended to cause any person lawfully entitled t o occupancy of a rental unit to vacate such rental unit or to surrender or waive any rights in relation to such occupancy.
14) Remove a housing service for the purpose of causing the t enant to vacate the residential real property . For example, taking away a parking space knowing that a t enant cannot find alternative parking and must move.
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15) Interfere with the right of tenants to organize as t enants and engage in concerted activities with other t enants for the purpose of mutual aid and protection; provide property access to t enant organizers, advocates, or representatives working with or on behalf of t enants living at a property; convene tenant or t enant organization meetings in an a ppropriate space accessible to t enants under the terms of their rental agreement; or distribute and post literature informing other tenants of their rights and of opportunities to involve themselves in their project in common areas, including lobby areas and bulletin boards.
16) Threatening or intimidating a tenant based on their immigr ation or citizenship status or otherwise disclosing a tenant’s immigration or citizenship status in violation of California Civil Code section 1940.35(a) and California Code of Civil Procedure section 1161.4, as may be amended.
Section 8-1997 – Violations.
It shall be unlawful for any person to violate or fail to comply with any provision of the ordinance. The violation of any provision of this ordinance shall first be punished through the use of an administrative citation, as provided in Santa Ana Mun icipal Code section 1-21, et seq., prior to prosecution as a misdemeanor or infraction, as provided in Santa Ana Municipal Code section 1-8.
DIVISION 53. – RENT STABILIZATION
Section 8-1998.13140 – Prohibited Increases.
(a) Increases in rent on resident ial real property or mobilehome spaces in the City of Santa Ana in excess of three percent (3%), or eighty (80%) of the change in the Consumer Price Index, whichever is less, and more than one rent increase in any twelve (12) month period, are prohibited, unless expressly exempt under the Costa-Hawkins Rental Housing Act codified in California Civil Code section 1954.50, et seq., or the Mobilehome Residency Law codified in California Civil Code sections 798, et seq. If the change in the Consumer Price Inde x is negative, no rent increase is permitted. The term Consumer Price Index means, at the time of the adjustment calculation completed by the City pursuant to subsection (b) , the percentage increase in the United State Consumer Price Index for all Urban Consumers in the Los Angeles -Long Beach-Anaheim Metropolitan Area published by the Bureau of Labor Statistics, not seasonally adjusted, for the most recent twelve (12) month period ending prior to the City’s calculation pursuant to subsection (b) . A violatio n of this section occurs upon the service of notice or demand for a prohibited increase in rent.
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(b) No later than June 30 th each year, beginning with the year 2022, the City shall announce the amount of allowable re nt increase based on subsection (a) herein, which shall be effective as of September 1 st of that year.
Section 8-1998.23141 – Reasonable Rate of Return.
This ordinance allows for an annual adjustment of residential real property or mobilehome space rent of up to three percent (3%), or eighty (80%) of the change in the Consumer Price Index, whichever is less. A Consumer Price Index-based increase is found and determined to provide a just and reasonable return on a n owner’s property, and has been adopted to encourage good management, reward effi ciency, and discourage the flight of capital, as well as to be commensurate with returns on comparable investments, but not so high as to defeat the purpose of curtailing excessive rents and rental increases. Notwithstanding the for egoing, however, any owner of residential real property or a mobilehome park who contends that the limit on rental increases set forth in Section 8-1998.13140 above will prevent the owner from receiving a fair and reasonable return on their property may petition for re lief from the cap set forth in s ection 8-1998.13140 pursuant to the procedures set forth in section 8- 1998.3this Division.
Section 8-1998.33142 – Fair Return Petition for Rent Increase.
(a) An owner of residential real property or a mobilehome park owner may petition for a rent increase in excess of that provided in section 8 -1998.1 in order to obtain a fair and reasonable return on their property (“Fair Return Petition”). Such Fair Return Petition shall be on an application form prescribed by the City Manager and shall be decided by the City Manager, or their designee (“City Manager”). Owner shall provide a copy of any Fair Return Petition submitted to the City to the applicable tenant(s), and provide City with proof of completing such service to the applica ble tenant(s). The tenant(s) will then have thirty (30) days from the date of receiving the Fair Return Petition to reply or provide additional materials to the City in response to the Fair Return Petition. The applicant shall bear the burden of establis hing that a rate increase in excess of that provided in section 8 -1998.1 is necessary to provide the applicant with a fair and reasonable return on their property, including by providing an independent financial report and verified financial data demonstra ting that without such an increase, they will not realize a fair and reasonable return on their property.
(b) Applicant shall be responsible for all costs associated with the City’s review of the Fair Return Petition. Upon receipt of a Fair Return Petiti on, the City Manager shall determine the anticipated costs of review and if the employment of expert(s) will be necessary or appropriate for a proper analysis of the applicant’s request. If the City Manager so determines, the City Manager shall also deter mine the anticipated costs of employing such expert(s). The resulting figure shall be EXHIBIT 2
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communicated to the applicant, and the Fair Return Petition shall not be processed until the applicant has paid to the City the estimated cost of the complete analysis. City will provide applicant with an invoice of all costs incurred after the review of the Fair Return Petition. Any unused portion of the advance payment for analysis shall be refunded to the applicant. If additional funds are required, payment will be r equired before applicant receives the determination on the Fair Return Petition from the City.
(c) The factors the City Manager may consider in deciding a Fair Return Petition may include, but not be limited to:
(1) Changes in the Consumer Price Index fo r All Urban Consumers in the Los Angeles-Long Beach-Anaheim Metropolitan Area published by the Bureau of Labor Statistics.
(2) The rent lawfully charged for comparable residential real property or mobilehome spaces in the City.
(3) The length of time since the last determination by the City Manager on a rent increase application, or the last rent increase if no previous rent increase application has been made.
(4) The completion of any capital improvements or rehabilitation work related to the residentia l real property or mobilehome space or spaces specified in the Fair Return Petition, and the cost thereof, including materials, labor, construction interest, permit fees, and other items the City Manager deems appropriate.
(5) Changes in property taxes or other taxes related to the subject residential real property or mobilehome park.
(6) Changes in the rent paid by the applicant for the lease of the residential real property or land on which the subject mobilehome park is located.
(7) Changes in the ut ility charges for the subject residential real property or mobilehome park paid by the applicant, and the extent, if any, of reimbursement from the tenants.
(8) Changes in reasonable operating and maintenance expenses.
(9) The need for repairs caused by circumstances other than ordinary wear and tear.
(10) The amount and quality of services provided by the applicant to the affected tenant(s).
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(11) Any existing written lease lawfully entered into between the applicant and the affected tenant(s).
(d) A Fair Return Petition shall be decided by the City Manager within sixty (60) calendar days of the date that the application has been deemed complete, including proof of service of the Fair Return Petition on the applicable tenant(s). The decision shall be em ailed and sent by mail, with proof of mailing to the subject property owner, the owner's designated representative(s) for the Fair Return Petition, and a designated representative of the tenant(s). Any appeal of the City Manager decision on a Fair Return Petition shall proceed pursuant to the administrative appeal procedures found in Chapter 3 of the Santa Ana Municipal Code.
(a) A Landlord may submit a Fair Return Petition to the Program Administrator in accordance with the procedures set forth in this Division requesting a Rent Increase in excess of that provided in this Division in order to obtain a fair and reasonable return on the Rental Unit.
(b) Standard of Review. All relevant factors shall be considered when evaluating a Fair Return Petition, including, but not limited to, the following:
1) Changes in the Consumer Price Index for All Urban Consumers in the Los Angeles-Long Beach-Anaheim Metropolitan Area published by the Bureau of Labor Statistics;
2) The Rent lawfully charged for comparable Rental Units in the City; 3) The length of time since the last determination on a Fair Return Petition, or the last Rent increase if no previous Fair Return Petition has been made;
4) The completion of any rehabilitation work related to the Rental Unit, and the cost thereof, including materials, labor, construction interest, permit fees, and other items deemed appropriate; 5) Changes in property taxes or other taxes related to the Rental Unit; 6) Changes in the Rent paid by the Landlord for the lease of the Rental Unit;
7) Changes in the utility charges for the Rental Unit paid by the Landlord, and the extent, if any, of reimbursement from the Tenants;
8) Changes in reasonable Operating Expenses;
9) Changes in Net Operating Income;
10) The need for repairs caused by circumstances other than ordinary wear and tear;
11) The amount and quality of Housing Services provided by the Landlord to the Tenants;
12) Compliance with any existing Rental Agreement lawfully entered into between the Landlord and Tenants; and
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13) Landlord’s substantial compliance with this Article and applicable housing, health and safety codes.
Section 8-3143 – Capital Improvement Petition
(a) Effective July 1, 2023, or as modified by resolution of the City Council, a Landlord may submit a Capital Improvement Petition to the Program Administrator in accordance with the procedures set forth in this Division requesting a pass-through cost to the Tenants to cover expenses incurred by the Landlord to complete Capital Improvements for the Rental Unit pursuant to the following provisions:
1) The Capital Improvement was paid for and completed after November 19, 2021 (the effective date of the first adopted Rent Stabilization Ordinance);
2) The Capital Improvement was paid for and completed prior to the filing of the Capital Improvement Petition;
3) A Capital Improvement Petition must be initiated by the Landlord within two (2) years of completion of the Capital Improvement; 4) A Capital Improvement Petition shall not apply to Rental Units or new Tenants whose initial Rent was established after the Landlord completed the Capital Improvement;
5) The Landlord may not require a Tenant to pay any amount of any cost that is attributable to any period of time that the Tenant was not entitled to use and occupy the Rental Unit;
6) The Landlord may not require a Tenant to pay more than the Tenant’s share of the cost attributable to that Tenant’s Rental Unit that is permitted to be passed through to the Tenant;
7) If the Capital Improvement inures solely to the benefit of one or more of the Rental Units, but to less than all, the surcharge shall be so annualized, but shall be applied and/or prorated only with respect to the one or more Rental Units actually so benefited; 8) Equipment otherwise eligible as a Capital Improvement will not be considered if a “use fee” is charged (i.e. – coin operated washer and dryers); and,
9) Pass through costs for Capital Improvements shall not be considered Rent and shall not be increased when Rent Increases, nor shall they be considered Rent for purposes of calculating a Rent Increase.
(b) Calculating Capital Improvements. Any Capital Improvement pass- through cost must be calculated according to the following:
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1) Capital Improvement costs must be amortized over the useful life of the Capital Improvement, not to exceed ten percent (10%) of the current Rent; for the purposes of such computation, the current Rent for any time period shall not include any Capital Improvement pass-through amounts;
2) For mixed-use structures and Landlord-occupied Rental Units, only the percent of residential square footage will be applied in the calculations;
3) If a unit is occupied by an agent of the Landlord, this unit must be included when determining the average costs per Rental Unit; and, 4) If the Landlord is reimbursed for Capital Improvements (i.e. – insurance, court-awarded damages, subsidies, etc.), such reimbursement must be deducted from the Capital Improvements before costs are amortized and allocated among the Rental Units. (c) Standard of review. All relevant factors shall be considered when evaluating a Capital Improvement Petition, including the following:
1) Capital Improvement completed;
2) Landlord’s Petition made within two (2) years of completion of Capital Improvement;
3) Distinguished from ordinary repair or maintenance;
4) For the primary benefit, use, and enjoyment of the Tenant; 5) Permanently fixed in place or relatively immobile and appropriated to the use of the Rental Unit;
6) No “use fee” or other charge imposed on Tenants for its use; and, 7) Cost-factored and amortized.
Section 8-3144 – Tenant Petition
(a) Effective July 1, 2023, or as modified by resolution of the City Council, a Tenant may submit a Petition to the Program Administrator in accordance with the procedures set forth in this Division on any one (1) or more of the following grounds:
1) To request review of a Rent Increase in excess of the maximum allowed Rent Increase;
2) To request a reduction in Rent based on decreased Housing Services;
3) To request a reduction in Rent based on failure of the Landlord to maintain a habitable premises, including health, safety, fire, or building code violations;
4) To contest a Capital Improvement cost as an unauthorized or excessive pass through; or,
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5) For any other violation of this Article by the Landlord.
(b) Tenant’s time to file a Petition. Where applicable, a Tenant filing a Petition under this Division shall do so within the following time limits:
1) Tenant receiving a notice of Rent Increase shall have thirty (30) days after service of such notice to file a Petition for review of Rent; 2) In instances where notice is not provided as required, the Tenant shall file a Petition for review of Rent within thirty (30) days after Tenant knew of the alleged failure to comply with the requirements of this Article; and,
3) For any other violation(s) of this Article by the Landlord, the Tenant shall file a Petition within one hundred and eighty (180) days of the alleged violation(s).
(c) Standard of Review. All relevant factors shall be considered when evaluating a Tenant Petition, including the following:
1) Landlord allows violations of this Article or other applicable state and local statutes to persist;
2) Any reduction of Housing Services, living space, or amenities; 3) Substantial deterioration of the Rental Unit other than as a result of ordinary wear and tear;
4) Landlord’s failure to provide adequate Housing Services; 5) Tenant provided Landlord with reasonable notice and opportunity to correct the conditions that provide the basis for the petition; and, 6) Landlord’s failure to comply substantially with this Article or applicable housing, health and safety codes.
(d) Restoration of Rent Decrease. Where a Rent decrease has been ordered pursuant to this Division due to a decrease in Housing Services or failure to maintain habitability, the amount of Rent decreased (return of excess Rent) may be restored in accordance with procedures set out in the regulations when the former Housing Services or maintenance levels are reinstated.
Section 8-3145 – Petition Process
A Landlord or a Tenant may file Petitions with the Program Administrator, as provided in this Division. For purposes of this Petition process, the Landlord and each Tenant of a Rental Unit that is the subject of a Petition shall be a “party” to the Petition.
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Petitions filed under this Article. Petitions shall be governed by such regulations and by the provisions of this Section.
(a) Filing Petition. Upon the filing of a Petition, the Program Administrator shall notify the petitioner of the acceptance or denial of the Petition based on the completeness of the submission. The Program Administrator shall not assess the merits of the Petition, and shall only refuse acceptance of a Petition that does not include required information or documentation or comply with the requirements of this Division.
(b) Filing Fee. Fees for the filing of any Petition shall be established by City Council resolution in the City’s Miscellaneous Fee Schedule.
(c) Prior Petition. Notwithstanding any other provision of this Division, no Petition shall proceed if a decision has been made with regard to a prior Petition based on the same or substantially the same grounds within the previous one hundred and eighty (180) days.
(d) No Landlord Petition or upward adjustment of Rent shall be authorized under this Division if the Landlord:
1) Has continued to fail to comply, after order of the Board, with any provisions of this Article and/or orders or regulations issued thereunder by the Board; or,
2) Has failed to bring the Rental Unit into compliance with the implied warranty of habitability.
(e) Notice of Petition. As soon as possible after acceptance of a Petition, the Program Administrator shall provide written notice to the Landlord, if the Petition was filed by the Tenant, or the Tenant, if the Petition was filed by the Landlord, of the receipt of such a Petition. The written notice shall inform the parties of the Petition process, the right to respond, and include a copy of the completed Petition and supportive documents. Any response submitted by the responding party will be made available to the petitioning party.
(f) Hearing Officer. An impartial hearing officer appointed by the Program Administrator shall conduct a hearing to act upon the Petition. The Hearing Officer has the following powers:
1) To make a determination on a Petition; and
2) Any other powers delegated to the Hearing Officer by the Board. (g) Board Action in Lieu of Reference to Hearing Officer. The Board, on its own motion, in the Board’s sole discretion, may hold a hearing on a Petition without the Petition first being heard by a Hearing Officer.
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(h) Time of Hearing. Each accepted Petition shall be scheduled for a hearing by the Hearing Officer to be held on a date not more than sixty (60) days from the date the Program Administrator accepts the Petition. With agreement of the parties, the Hearing Officer may hold the hearing beyond the sixty (60) days. In no event later than ten (10) days prior to the hearing, the Hearing Officer shall notify all parties as to the time, date, and place of the hearing.
(i) Consolidation. All Landlord Petitions pertaining to Tenants in the same building shall be consolidated for hearing, and all Petitions filed by Tenants occupying the same building shall be consolidated for hearing, unless the Program Administrator or Hearing Officer finds good cause not to consolidate such Petitions.
(j) Right of Assistance. All parties to a hearing may have assistance in presenting evidence and developing their position from attorneys, legal workers, or any other persons designated by said parties.
(k) Rules of Evidence. Formal rules of evidence shall not be applicable to hearings on Petitions. At such a hearing, the parties may offer any documents, testimony, written declarations, or other evidence that, in the opinion of the hearing officer, is credible and relevant to the Petition. The Hearing Officer may consider the results of inspections of the property in question and the results of any other investigations conducted by or at the request of the Hearing Officer or Program Administrator. Evidence unduly repetitious, lacking credibility, or irrelevant evidence shall be excluded upon order by the Hearing Officer.
(l) Evidence. Any party may appear and offer such documents, testimony, written declarations, or other evidence as may be pertinent to the proceeding. The hearing officer may require either party to a Petition to provide any books, records, or papers deemed pertinent, in addition to that information contained in the Petition and Rental Registry. The hearing officer may request the City to conduct a current building inspection if the hearing officer finds good cause to believe the current information does not reflect the current condition of the Rental Unit. All documents required under this section shall be made available to the parties involved prior to the hearing. In cases where information filed in a Petition or in additional submissions filed at the request of the Hearing Officer is inadequate or false, no action shall be taken on said Petition until the deficiency is remedied.
(m) Quantum of Proof. The party who files the Petition shall have the burden of proof. No Petition shall be granted unless supported by the preponderance of the evidence submitted at the hearing.
(n) Time for Decision. The policies and procedures adopted by the Board shall provide for final action on any Petition within a reasonable time.
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upon which the determination is based. The Hearing Officer’s decision on a Petition may be reasonably conditioned in any manner necessary to effectuate the purposes of this Article. Additionally, the parties to the hearing shall also be notified of their right to any appeal allowed by the Board and/or to judicial review of the decision pursuant to this Division.
(p) Hearing Record. The record of the hearing shall include: the Petition; all exhibits, papers, and documents required to be filed or accepted into evidence during the proceedings; a list of participants present; a summary of all testimony accepted in the proceedings; a statement of all materials officially noticed; all recommended decisions, orders and/or rulings; all final decisions, orders and/or rulings; and the reasons for each final decision, order and/or ruling. All hearings shall be recorded.
(q) Appeal. Any person aggrieved by the decisions of the Hearing Officer may appeal to the Board. An appeal to the Board shall be filed no later than thirty (30) days after receipt of the notice of the decision of the Hearing Officer. On appeal, the Board shall affirm, reverse, or modify the decision of the Hearing Officer. Unless the Board elects to conduct a de novo hearing, Board review of the Hearing Officer’s decision shall be based on the hearing record without holding a new hearing. The Board may consider additional evidence for good cause, including evidence which did not exist at the time of the hearing or which could not be discovered using due diligence by a party. If no Board exists, any appeal of the Hearing Officer decision on a Petition shall proceed pursuant to the administrative appeal procedures found in Chapter 3 of the Santa Ana Municipal Code.
(r) Finality of Decision. The decision of the Hearing Officer shall be the final decision of the Board in the event of no appeal to the Board. The decision of the Hearing Officer shall not be stayed pending appeal; however, in the event that the Board on appeal reverses or modifies the decision of the Hearing Officer, the Board shall order the appropriate party to make retroactive payments, as applicable, to restore the parties to the position they would have occupied had the Hearing Officer’s decision been the same as that of the Board.
Section 8-3146 – Voluntary Mediation
(a) Voluntary mediation services shall be provided by the City. Upon request, the Program Administrator shall appoint a mediator and set a date for a mediation no later than thirty (30) days after the acceptance of the subject Petition, unless the Program Administrator determines that additional time is required under the circumstances. The Program Administrator shall notify the Landlord and Tenant(s) in writing of the date, time, and place of the mediation hearing at least ten (10) days prior to the mediation. This notice shall be served either in person or through ordinary mail or electronic correspondence.
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(b) It is the intent and purpose of mediation to provide a process in which mediators may assist disputants in reaching a voluntary agreement. Accordingly, except as otherwise expressly provided herein, there shall be no penalty or disability, either civil or criminal, for failure to participate in the mediation process, and there shall be no penalty, either civil or criminal, for failure to reach agreement with a disputant in the mediation process.
(c) Mediation is a voluntary collaborative process wherein the Landlord and Tenant(s) who have a disagreement can develop options, consider alternatives, and develop a consensual agreement. The role of the mediator is to facilitate open communication to resolve a dispute in a non-adversarial and confidential manner.
(d) If the Landlord and Tenant agree to a resolution, the mediator may assist the parties in preparing a written settlement agreement for the signature of the Landlord and the Tenant, provided that in doing so the mediator confines the assistance to stating the settlement as determined by the parties. Such agreement shall constitute a legally enforceable contract.
(e) Should the parties fail to agree to a resolution, or the mediator determines that the parties have reached an impasse, the mediator may refer the Petition back to the Program Administrator to continue the Petition review process detailed in this Division.
(f) All documents and results related to mediations and facilitations held pursuant to this Article shall be kept confidential and shall be inadmissible as evidence in any subsequent administrative or judicial proceeding.
(g) The mediator and/or program administrator shall provide documentation and translation services in the language that the Owner and tenant used to negotiate the terms of the Tenancy (e.g., Spanish, Chinese, Tagalog, Vietnamese and Korean), as well as English.
Section 8-1998.43147 – Exemptions.
(a) Pursuant to the Costa-Hawkins Rental Housing Act, the provisions of this ordinance regulating the amount of rent that a residential real property owner ma y charge shall not apply to the following: any residential real property that has a certificate of occupancy issued after February 1, 1995 ( California Civil Code section 1954.52(a)(1)); and, any other provisions of the Costa -Hawkins Rental Housing Act addressing exemptions, as applicable.
(b) Pursuant to the Mobilehome Residency Law, the provisions of this ordinance regulating the amount of rent that a mobilehome park owner may charge for a mobilehome space shall not apply to the following: any mobilehome space subject to a long term (more than one year) rental agreement ( California Civil Code section 798.17); EXHIBIT 2
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any newly constructed mobilehome space first offered for rent on or after January 1, 1990 (California Civil Code section 798.45); mobilehomes not be ing used as a person’s primary residence that are not being leased to someone else ( California C ivil Code section 798.21); and, any other provisions of the Mobilehome Residency Law addressing exemptions, as applicable.
(c) Pursuant to the Tenant Prot ection Act of 2019, Civil Code section 1947.12(d), the provisions of this ordinance regulating the amount of rent that a residential real property Owner may charge shall not apply to the following:
(1) Housing restricted by deed, regulatory restriction conta ined in an agreement with a government agency, or other recorded document as affordable housing for persons and families of very low, low, or moderate income, as defined in Section 50093 of the Health and Safety Code, or subject to an agreement that provid es housing subsidies for affordable housing for persons and families of very low, low, or moderate income, as defined in Section 50093 of the Health and Safety Code or comparable federal statutes.
(1) Dormitories owned and operated by an institution of higher education or a kindergarten and grades 1 to 12, inclusive, school.
(2) Housing that has been issued a certificate of occupancy within the previous 15 years.
(3) Residential real property that is alienable separate from the title to any other dwelling unit, provided that both of the following apply:
A. The owner is not any of the following:
i. A real estate investment trust, as defined in section 856 of the Internal Revenue Code.
ii. A corporation.
iii. A limited liability company in which at least one member is a corporation.
B.
i. The tenants have been provided written notice that the residential real property is exempt from this section using the following statement:
“This property is not subject to the rent limits imposed by Santa Ana Municipal Code section 8 -1998.13140
and the owner is not any of the following: (1) a real
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estate investment trust, as defined by section 856 of
the Internal Revenue Code; (2) a corporation; or (3) a
limited liability company in which at least one member
is a corporation.”
ii. For a tenancy existin g before the effective date of this ordinance, the notice required under clause (i) may, but is not required to, be provided in the rental agreement.
iii. For a tenancy commenced or renewed on or after the effective date of this ordinance, the notice required under clause (i) must be provided in the rental agreement.
(4) A property containing two separate dwelling units within a single structure in which the owner occupied one of the units as the owner’s principal place of residence at the beginning of the tenancy so long as the owner continues in occupancy, and neither unit is an accessory dwelling unit or a junior accessory dwelling unit.
(d) The provisions of this ordinance regulating the amount of rent that a residential real property Owner may charge shall no t apply to residential real property in which each of the units have been substantially rehabilitated within the previous 15 years. For purposes of this section, “substantially rehabilitated” shall mean that the cost to rehabilitate the residential real property was at least $40,000 per unit.
Section 8-1998.53148 – Rent Increase Ineffective.
No rent increase shall be effective if the owner:
(a) Fails to substantially comply with all provisions of this Division, including but not limited to the failure to provide notices as required; or
(b) Fails to maintain the residential real property or mobilehome space in compliance with California Civil Code Sections 1941.1 et seq. and California Health and Safety Code sections 17920.3 and 17920.10 , except as to Mobileh omes and Mobilehome Spaces in Mobilehome Parks that are subject to the Mobilehome Parks Act, Health and Saf ety Code section 18200, et seq.; Manufactured Housing Act, Health and Safety C ode section 18000, et seq.; or the National Manufactured Housing Construction and Safety Standards Act of 1974, 42 U.S.C. sections 5401, et seq. , as applicable; or
(c) Fails to make repairs ordered by the City or court of competent jurisdiction.
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(d) No rent increases shall take effect for any Rental Unit unless the Landlord has accurately completed the Rental Unit Registration.
Section 8-1998.63149 – Notice Requirements.
(a) An owner of any residential real property or mobilehome space subject to this provision sha ll, o n or before the date of commencement of a tenancy, give the tenant a written notice in a form prescribed by the City which must include the following information:
(1) The existence and scope of this Division 53 of Article XIX of Chapter 8 of the Santa Ana Municipal Code; and
(2) The tenant’s right to respond to any Fair Re turn or Capital Improvement Petition filed with the City by the owner pursuant to section 8-1998.3this Division.
(b) As part of any notice to increase rent, an owner must include:
(1) Notice of the existence of this Division 53 of Article XIX of Chapter 8 of the Santa Ana Municipal Code; and
(2) The tenant’s right to respond to any Fair Return or Capital Improvement Petition filed with the City by the owner pursuant to section 8-1998.3this Division, unless such rent increase is pursuant to an approved Fair Return Petition.
(3) No rent increase shall take effect until the requirements of this Division have been met.
(c) The owner must give notices to the tenant in the language that the owner and tenant used to negotiate the terms of the tenancy ( e.g., English, Spanish, Chinese, Tagalog, Vietnamese, and Korean) as well as English.
(d) Any notices or documents required to be provided from a Landlord to a Tenant by this Article or any other federal, state, or local law, including, but not limited to, notice of Rent Increase and no tice of eviction, shall be provided to the City through the Rental Registry portal.
Section 8-1998.7 – Definition of Rent.
For the purposes of this Division, “Rent” means all periodic payments and all nonmonetary consideration, including, but not limite d to, the fair market value of goods or services rendered to or for the benefit of the owner under an agreement concerning the use or occupancy of residential real property or mobilehome space, including all EXHIBIT 2
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payment and consideration demanded or paid for p arking, pets, furniture, subletting and security deposits for damages and cleaning.
Section 8-1998.8 – Violations.
It shall be unlawful for any person to violate or fail to comply with any provision of the ordinance. The violation of any provision of t his ordinance shall first be punished through the use of an administrative citation, as provided in Santa Ana Municipal Code section 1-21, et seq., prior to prosecution as a misdemeanor or infraction, as provided in Santa Ana Municipal Code section 1-8.
DIVISION 4. – RENTAL REGISTRY AND RENTAL REGISTRY FEE
Section 8-3160 – Rental Registry
Effective July 1, 2023, or as modified by resolution of the City Council, the City shall create a Rental Registry and all Landlords with Rental Units in the City of Santa Ana shall complete and submit Registration Forms for each Rental Unit pursuant to the following:
(a) Initial Registration. A Landlord must file an initial Registration Form with the City for each Rental Unit that is subject to the provisions of this Article.
Registration of a Rental Unit shall not be complete until an Owner has:
1) Completely and accurately provided a Registration Form; and, 2) Paid all fees owed to the City with respect to the Rental Unit including Registration Fees imposed pursuant to this Article. (b) Change of Ownership or Management.
1) Whenever a change in ownership of a Rental Unit occurs, the Landlord shall provide the City with written notice of the change in ownership, including the date of transfer, and the name, address and contact information of the new owner, within thirty (30) days of the close of escrow.
2) The new owner is required to file a Registration Form with the City within sixty (60) days of such change. The new owner’s Registration Form will only be accepted by the City if it is accompanied by a copy of a written notification on a form prescribed by the Program Administrator from the Landlord to all Tenants advising the Tenants of the change in ownership of the building and setting forth the name, address and contact information of the new owner and of the new owner’s property manager or representative, and a declaration that the new owner served the written notification on all the Tenants.
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3) Registration amendments also shall be required to be filed with the City within sixty (60) days of a change of the property management or authorized agent or if the address of the owner or authorized agent changes.
(c) Re-Registration Following a Vacancy. A Landlord shall, in the manner described herein, re-register a Rental Unit with the City within thirty (30) days after a vacancy has occurred and the Rental Unit is re-rented.
(d) Claim of Exemption. Any Landlord that is claiming any exemption from this Article must file a claim of exemption with the City. The Landlord shall provide the City, on a form approved by the Program Administrator and accompanied by supporting documentation, a written declaration stating the facts which support the claim of exemption from the provisions of this Article. If the written declaration and supporting documents are not submitted by July 1 of each year for any Rental Unit, that Rental Unit shall be deemed to be subject to the provisions of this Article. If the Board determines that any Unit was incorrectly registered as exempt due to any affirmative misrepresentation by the Owner, the exemption for that Unit may be revoked retroactively, and the Unit will be subject to any applicable enforcement measures.
(e) Termination of Exemption. Any time a Rental Unit that has been exempted under the provisions of this Article loses its exempt status due to termination of the conditions qualifying it for exemption, the Landlord of such Rental Unit is required to file a Registration Form for said Rental Unit within thirty (30) days of the change in status.
(f) Annual Requirement. For the subsequent years after the initial Registration date, each Registration Form and claims of exemption(s) must be annually filed on or before July 1 of each year. The Rental Housing Board may modify the annual registration date.
(g) Contents of Registration Form. The Rental Registration Form shall completely and accurately provide the following information from the Landlord for each Rental Unit as of the date of filing the Registration Form:
1) Address of each Rental Unit including identifying number or letter; 2) Number of bedrooms and bathrooms in the Rental Unit; 3) Name, current address, and contact information of current owners, authorized representatives and property managers;
4) Date of assumption of ownership by current owners;
5) Current Rent;
6) Date and amount of last Rent Increase; and
7) Move-in date of current Tenant(s).
The Board and/or Program Administrator may adopt policies and procedures that require additional information to be collected and recorded in Registration Forms in furtherance of the objectives of this Article.
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(h) Affidavit. All Rental Registration Forms provided by Landlords in accordance with this Division shall include an affidavit signed by the Landlord declaring under penalty of perjury that the information provided in the Rental Registration Form is true and correct.
(i) Notices. Any notices or documents required to be provided from a Landlord to a Tenant by this Article or any other federal, state, or local law, including, but not limited to, notice of Rent Increase and notice of eviction, shall be provided to the City through the Rental Registry portal.
(j) Proper Registration. Registration of a Rental Unit shall not be complete until the Landlord has:
1) Paid all fees and penalties owed to the City with respect to the Rental Unit, including the Rental Registry Fee, imposed pursuant to this Article; and,
2) Filed a complete and accurate Registration Form for that Rental Unit including all information required by this Division and any policies and procedures adopted by the Board and/or Program Administrator.
(k) Commencing October 1, 2023, the City may commence enforcement against any Landlord who fails to register a Rental Unit, or provide current and accurate data regarding a Rental Unit, according to this Division. Furthermore, no Landlord shall advertise for rent, demand or accept rent for a Rental Unit, or evict any Tenant from a Rental Unit, if the Rental Unit Registration is not complete and accurate. In addition, no petition, application, claim or request, and no rent increases shall take effect for any Rental Unit unless the Landlord has accurately completed the Rental Unit Registration.
Section 8-3161 – Rental Registry Fee
Effective July 1, 2023, or as modified by resolution of the City Council, an annual Rental Registry Fee shall be imposed on each Rental Unit in the City. All Landlords with Rental Units that are subject to this Article shall pay the Rental Registry Fee as established by the City Council. The Rental Registry Fee is to fund the City’s cost to implement, administer, monitor, support, and enforce the provisions of this Article.
(a) Amount of Fee. A Landlord shall pay to the City a Rental Registry Fee for each of the Landlord’s Rental Units in the City. The amount of the Fee shall be determined by resolution of the City Council adopted from time to time and set forth in the City’s Miscellaneous Fee Schedule. The Fee shall not exceed the amount found by the City Council to be necessary to administer the provisions of this Article, and the City Council’s findings in this regard shall be final.
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(b) Deadline for Landlord Payment of Rental Registry Fee. Annual Rental Registry Fees shall be due and owing on July 1 each year, or within thirty (30) calendar days of any subsequent changes to the Rental Unit.
(c) Late Payment. Any Landlord responsible for paying the Rental Registry Fee who fails to pay the Fee by October 1, or within sixty (60) calendar days of any mid- year due date, will be delinquent and shall, in addition to the Fee, pay additional late charges, penalties of assessments as determined by resolution of the City Council. The amount of Rental Registry Fee and any penalty imposed by the provisions of this Article shall be deemed a debt to the City.
(d) Pass Through to Tenants. After timely payment of the Rental Registry Fee, the Landlord may pass through up to fifty percent (50%) of the Fee to Tenants of the applicable Rental Unit, to be paid by the Tenant in twelve (12) equal monthly installments. The Fee pass-through shall not be considered part of the Rent in calculating any Rent increase. If a Landlord fails to timely pay the Fee and becomes delinquent, neither the Fee nor any penalties can be passed through to the Tenant. In the event a Tenant paid registration fee pass-through costs in excess of that permitted by this Division, the Landlord shall reimburse the Tenant for the registration fee pass- through cost overpayment.
1) No Pass-Through for Subsidized Tenants. No portion of the registration fee may be passed through to tenants who reside in housing restricted by deed, regulatory restriction contained in an agreement with a government agency, or other recorded document as affordable housing for persons and families of very low, low, or moderate income, as defined in Section 50093 of the Health and Safety Code, or subject to an agreement that provides housing subsidies for affordable housing for persons and families of very low, low, or moderate income, as defined in Section 50093 of the Health and Safety Code or comparable federal statutes.
Section 8-3162 – Education and Outreach.
The Program Administrator shall have the authority to contract with community- based organizations for them to assist in the education and outreach related to this Article.
DIVISION 5. – RENTAL HOUSING BOARD
Section 8-3180 – Rental Housing Board
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There is hereby created and established a Rental Housing Board to perform the functions designated in this Article. The composition of the Board and selection of Board Members shall be based upon the following:
(a) Membership of Board. The Rental Housing Board shall consist of seven (7) Board Members who shall be appointed by the Mayor and approved by the City Council, including:
1) Three (3) Tenants, including at least one (1) Mobilehome Tenant; 2) Three (3) Landlords; and
3) One (1) at-large Member with no financial interest and no ownership of income-generating rental housing.
(b) Chairperson. The Board shall elect annually one of its Members to serve in the capacity as Chairperson.
(c) Eligibility. Residents of the City are eligible to serve as members of the Board.
(d) Full Disclosure of Holdings. Nominees for the position of Board Member shall submit a verified statement listing all of their interests and dealings in real property, including, but not limited to, ownership, sale or management of real property during the previous three (3) years. The Board may promulgate additional regulations.
(e) Conflict of Interest. Board Members shall be subject to the requirements of the California Political Reform Act and other applicable state and local conflict of interest codes. Accordingly, a Board member shall be disqualified from participating in any hearing on an application, petition, or appeal where the Board Member is either the Landlord or a Tenant residing at the subject property, or has any other form of conflict of interest.
(f) Training Required. All Board members shall attend training as designated by the Program Administrator.
Section 8-3181 – Rental Housing Board Member Term and Compensation
(a) Term. Board Members shall serve terms of two (2) years and may serve up to four (4) full terms for a total Term not to exceed eight (8) years. However, the City Council may remove a Board Member at any time for any reason.
(b) Compensation. Fifty dollars ($50.00) per meeting, plus fifty dollars ($50.00) per month automobile allowance.
Section 8-3182 – Rental Housing Board Powers and Duties
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(a) The Rental Housing Board shall have the following powers and duties:
1) To hold regular meetings at least once each calendar month, or as needed, as fixed by the by-laws of the Board.
2) Conduct hearings on petitions, applications, and appeals of hearings determined by a Hearing Officer submitted by Landlords or Tenants under this Article. Any fees for such hearings shall be established by City Council resolution in the City’s Miscellaneous Fee Schedule.
3) Promulgate and implement policies and procedures for the administration and enforcement of this Article. Make such studies, surveys, and investigations, conduct such hearings, and obtain such information as is necessary to carry out its powers and duties. 4) Review and assess yearly that sufficient number of staff are employed, including a Program Administrator, hearing officers, housing counselors and legal staff, as may be necessary to perform its function efficiently in order to fulfill the purpose of this Article. 5) Any other duties as necessary to administer and enforce this Article.
6) Such other duties as are designated by resolution of the City Council.
Section 8-3183 – Rental Housing Board Policies and Procedures
The Board shall issue and follow such policies and procedures, including those which are contained in this Article, as will further the purposes of the Article.
Section 8-3184 – Rental Housing Board Meetings
(a) The Board shall hold such regularly scheduled meetings as are necessary to ensure the timely performance of its duties under this Article. All regular and special meetings shall be called and conducted in accordance with state law.
(b) Quorum. Four (4) members of the Board shall constitute a quorum for the transaction of business.
(c) Voting. The affirmative vote of four (4) members of the Board is required for a decision, including all motions, rules, regulations, and orders of the Board.
Section 8-3185 – Judicial Review
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Any decision of the Rental Housing Board shall be final unless judicial review is sought in a court of competent jurisdiction within thirty (30) days of the date of the Board’s decision. The Board decision shall take effect immediately unless provided otherwise in the decision, regardless of whether a party seeks judicial review.
DIVISION 6. – ENFORCEMENT AND REMEDIES
Section 8-3200 – Violations
(a) It shall be unlawful for any person to violate or fail to comply with any provision of this Article. The violation of any provision of this Article shall first be punished through the use of an administrative citation, as provided in Santa Ana Municipal Code section 1-21, et seq., prior to prosecution as a misdemeanor or infraction, as provided in Santa Ana Municipal Code section 1-8.
(b) Civil Action. Any aggrieved person, including the City and the People of the State of California, may bring a civil action for damages for any violation of this Article or the rules, regulations, orders and decisions of the Rental Housing Board. The burden of proof in such cases shall be by a preponderance of the evidence. No administrative remedy need be exhausted prior to filing a civil suit pursuant to this section.
(c) Injunctive Relief. Any person who commits an act, proposes to commit an act, or engages in any pattern and practice that violates this Division, or the policies, procedures, regulations, rules, orders and decisions of the Rental Housing Board, may be enjoined therefrom by any court of competent jurisdiction. An action for injunction under this section may be brought by any aggrieved person, including the City and People of the State of California. No administrative remedy need be exhausted prior to filing an action for injunctive relief pursuant to this section.
(d) Affirmative Defense. A Landlord’s failure to comply with any requirement of this Article may be asserted as a complete affirmative defense in an unlawful detainer or any other action brought by the Landlord to recover possession of the Rental Unit.
Additionally, any attempt to recover possession of a Rental Unit in violation of this Article shall render the Landlord liable to the Tenant for damages in a civil action for wrongful eviction. The prevailing party in an action for wrongful eviction shall recover costs and reasonable attorneys’ fees.
(e) Public Nuisance. In addition to other penalties provided by law, any condition caused or permitted to exist in violation of any provision of this Article shall be deemed a public nuisance and may be summarily abated as such by the City, and each day such condition continues shall constitute a new and separate offense.
(f) Non-Exclusive. The remedies provided in this Article are not exclusive, and nothing in this Article shall preclude any person from seeking any other remedies, EXHIBIT 2
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penalties or procedures provided by law, nor is exhaustion of remedies under this section a prerequisite to the assertion of any other such right.
Section 4. The City Council finds and determines that this O rdinance is not subject to the California Environmental Quality Act (CEQA) pursuant to s ections 15060(c)(2) and 15060(c)(3) of the State CEQA Guidelines because it will not result in a direct or reasonably foreseeable indirect physical change in the environment, as there is no possibility it will have a significant effect on the environment and it is not a "project," as defined in s ection 15378 of the State CEQA Guidelines . Furthermore, the proposed Ordinance falls within the “common sense” CEQA” exemption set forth in CEQA Guidelines section 15061(b)(3), excluding projects where “it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment.”
Section 5. If any section, subsection, sentence, clause, phrase, or portion of this Ordinance is for any reason held to be invalid or unconstitutional by the decision of any court of competent jurisdiction , such decision shall not affect the v alidity of the remaining portions of this O rdinance. The City Council of the City of Santa Ana hereby declares that it would have adopted this Ordinance and each section, subsection, sentence, clause, phrase or portion thereof irrespective of the fact that any one or more sections, subsections, sentences, clauses, phrases, or portions be declared invalid or unconstitutional.
Section 6. This Ordinance shall become effective thirty (30) days after its adoption.
Section 7. The Clerk of the Council shall c ertify to the adoption of this Ordinance and cause the same to be published in the manner prescribed by law.
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ADOPTED this ___ day of ___________________, 2022.
_______________________
Vicente Sarmiento
Mayor
APPROVED AS TO FORM:
Sonia R. Carvalho, City Attorney
_______________________________
Ryan O. Hodge
Assistant City Attorney
AYES: Councilmembers: ________________________________________
NOES: Councilmembers: ________________________________________
ABSTAIN: Councilmembers: ________________________________________
NOT PRESENT: Councilmembers: ________________________________________
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CERTIFICATE OF ATTESTATION AND ORIGINALITY
I, , Clerk of the Council, do hereby attest to and c ertify the attached Ordinance No. NS-XXXX to be the original Ordinance adopted by the City Council of the City of Santa Ana on .
Date: ________________ ____________________________________ Clerk of the Council
City of Santa Ana
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Options for the Composition of the Board from RSG’s Long-Term Implementation Plan Jurisdiction Board Name Members Scope of Work
Alameda
Rent Review
Advisory
Committee
5 members appointed
by the Mayor and
approved by City
Council
2 Tenants
2 Housing
Providers
1 Residential
Property Owner
but not Housing
Provider
Review requests from
tenants concerning rent
increases
Hold hearings for
requests for a rent
increase review
Make recommendations
to the tenants and their
housing providers about
the increases
Berkeley
Rent Board (with
a number of
Committees)
9 Commissioners
elected by voters
Must submit a
verified statement
of their interests
and dealings in
real property
during the
previous three
years
Implement and oversee
program
Enact regulations
Hearing petition appeals
filed by tenants and
landlords
Beverly Hills
Rent
Stabilization
Commission
6 members and 3
alternates appointed
by City Council
2 Landlords
2 Tenants
2 members who
are not tenants or
managers or have
financial interest
in multi-family
residential rental
property
Make recommendations
to the City Council
concerning
amendments to
chapters of the Code
that have not been
resolved by the City
Council
Perform any other
functions that may be
designated by resolution
or motion of the City
Council
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Inglewood Rental Housing
Board
5 members appointed
by the mayor and
approved by City
Council
2 Landlords
2 Tenants
1 City
employee
Review applications
submitted by landlords
or tenants
Establish policies and
procedures for
administration and
compliance of the
program
Conduct hearings on
petitions filed or appeals
of decisions of a
Hearing Officer filed
Richmond Rent Board
5 members,
appointed by the
Mayor subject to
three additional votes
by City Council
members
Shall be no more
than two members
that own or
manage any
rental property or
are realtors
Establish Base Rent
Make adjustments in
rent increases and
decreases
Establish rules and
regulations
Charge and collect
registration fees
Collect/receive copies of
landlord notices
Refer violations to
appropriate authorities
Santa Monica Rent Control
Board
5 elected
Commissioners
Controlling residential
rents
Limiting the grounds for
eviction
Preserving rental
housing
Encouraging
maintenance
Ensuring landlords
receive a fair return
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City Council
www.santa-ana.org/city-council
Item # 26
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
October 4, 2022
TOPIC: Councilmember Requested Item: Closed Session Discussions Relating to Labor Negotiations
TITLE
Discuss and Provide Direction to the City Manager and City Attorney to Report to the City Council What is Necessary to Adopt a Policy to Move all Santa Ana Police Officers Association Contract Negotiations into a Public Forum
DISCUSSION
Councilmember Lopez added the following councilmember requested item:
At least one, but possibly more members of the current Santa Ana City Council are leaking confidential closed session information to the Association President of the Santa Ana Police Officers Association, Gerry Serrano. The action of leaking confidential information shared during closed session meetings undermines the good faith labor negotiations of the City, is a violation of the oaths of office of the councilmembers engaging in this activity, and is possibly considered illegal. These actions directly contradict their official duties as councilmembers.
On February 2 and 16, 2021, the City Council met to discuss privileged information pertaining to the level of involvement the City should have in Gerry Serrano’s pending CalPERs appeal hearing. Shortly after these closed session discussions, and before any public actions were taken, Gerry Serrano had knowledge of the City’s direction and expressed his anger with councilmembers and staff.
In August 2022, the City Council met to discuss privileged information regarding negotiating strategies with the Santa Ana Police Officers Association (POA). The negotiating team met with the POA on August 24 to relay direction. However, Gerry Serrano made comments indicating specific and direct knowledge about the City’s negotiations strategy. It is the lead negotiator's belief that Gerry Serrano had direct knowledge of the City Council's closed session discussion and the specifics of the conversation regarding the ongoing contract negotiations with the POA.
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October 4, 2022
3 9
8 I have no confidence that any closed session discussion of the POA contract negotiations will not be leaked to Gerry Serrano and the POA. Therefore, I ask the City Council to move all POA contract negotiations into a public forum so that every member of the public has the same level of access to information that has been consistently and covertly provided to Gerry Serrano during these negotiations.
This item was discussed with the City Manager and City Attorney.
Submitted By: Councilmember Jessie Lopez
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