City Council
Report
City Council Meeting: March 11, 2025
Agenda Item: 4.F
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To: Mayor and City Council
From: Jing Yeo, Planning Manager, Administration
Subject: Adoption of Resolution Authorizing Receipt of State of California Cannabis Equity Grant Funding for $35,000 for Development of a Cannabis Equity Program and Authorization for City Manager to Execute All Necessary Associated Documents
Recommended Action
Staff recommends that the City Council:
1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines.
2. Adopt the attached resolution authorizing the acceptance of a grant awarded in the amount of $35,000 from the Governor’s Office of Business and Economic Development for the Cannabis Equity Grants Program for Local Jurisdictions.
3. Authorize the City Manager to execute all necessary documents to accept the grant and all grant renewals.
4. Authorize budget amendment as outlined in the Financial Impacts & Budget Actions section of this report (requires 5 votes).
Summary
In continued response to City Council’s direction at the June 13, 2023, adult-use cannabis study session, City Planning Division staff applied for the Cannabis Equity Grants Program for Local Jurisdictions Type 1 Grant funding from the Governor’s Office of Business and Economic Development to assist in the development of a local cannabis equity program. On January 23, 2025, staff received notification that the City was awarded the grant for the maximum amount of $35,000.
The development of the equity program will be informed by the findings and recommendations of the cannabis equity assessment which is currently in progress and 2 of 6
expected to be completed by the end of March. This report requests Council’s approval of the attached resolution to authorize the acceptance of the California Cannabis Equity Type 1 Grant and to authorize the City Manager to execute all necessary documents to accept the grant.
Discussion
On June 13, 2023, the City Council held a study session to answer key policy questions regarding adult-use cannabis. Council directed staff to move forward with developing an adult-use cannabis ordinance including a social equity program.
The Governor’s Office of Business and Economic Development administers the Cannabis Equity Grants Program for Local Jurisdictions. Type 1 Grant funding provides up to $75,000 for eligible jurisdictions to establish a social equity program. Specifically, up to $40,000 may be awarded to assist with conducting an equity assessment and up to $35,000 to assist in developing a new equity program.
City Planning Division staff previously applied for the Cannabis Equity Grants Program for Local Jurisdictions Type 1 Grant funding from the Governor’s Office of Business and Economic Development to conduct a cannabis equity assessment for the City of Santa Monica, and the grant was awarded on January 19, 2024, for the maximum amount of $40,000 to conduct the assessment. The funds are currently being allocated to consultant professional services and minimal reimbursement for City staff project management.
Having successfully obtained $40,000 for the cannabis equity assessment last year, City Planning staff pursued the remaining funds for the program development. The grant was announced on October 8, 2024, applied for on December 2, 2024, and awarded on January 23, 2025. A Resolution adopted by the City Council to authorize the acceptance of the grant is required and must be submitted to the State by March 31, 2025, with final grant agreement executed by March 31, 2025, by the City Manager, as requirements for accepting the grant.
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This report recommends Council’s approval of the attached resolution to authorize the acceptance of the California Cannabis Equity Type 1 Grant and to authorize the City Manager to execute all necessary documents to accept the grant.
Developing a cannabis equity program is the final phase of developing a greater adultuse cannabis ordinance and program. The cannabis equity program will focus on inclusion and support of individuals and communities in Santa Monica’s cannabis market who are linked to populations or neighborhoods that were negatively or disproportionately impacted by its criminalization.
The scope of the social equity program is expected to consist of establishing eligibility criteria, application and administrative processes, and levels of service provided.
Program benefits may include, but are not limited to, tiered fees or fee waivers, financial literacy training, business development support, workforce development, direct or indirect financial assistance, priority selection, and/or streamlined permitting processes.
Staff will also determine the level of involvement required to accommodate applicants and if a consultant will be required to assist in this effort.
SCI Consulting Group was contracted in 2024 to conduct the equity assessment.
Building on of SCI’s findings and recommendations, the City Planning Division will lead the development of the local cannabis equity program in partnership with the City’s Diversity Equity & Inclusion and other City staff. While the equity assessment is underway, the Planning Division is concurrently developing an adult-use cannabis ordinance.
It is anticipated that the scope and budget of $35,000 will include the following staffrelated tasks and associated expenses:
Administrative Expenses
• Program Development
o City Planning staff time to develop and adopt eligibility requirements, application and review process, levels of services provided, staff 4 of 6
involvement and/or local agency support; integration with the Adult-Use Cannabis Ordinance.
• Public meetings/hearings:
o Staff time to prepare presentations on the cannabis equity program options, benefits and process explainers for City Council adoption and public use.
• Community Outreach:
o Produce marketing materials and implement outreach.
o Develop and organize resources to help inform the public of the equity program.
Equity Program Launch
• Community outreach:
o Conduct community outreach to promote the new equity program and provide explanation of eligibility and benefits. Website development and social media posts.
o Staff time for application intake, review, and processing of equity applicants.
The anticipated schedule of activities for the equity program is as follows:
• March 2025: Receive grant funding/execute the grant agreement. • April – July 2025: Develop equity program including eligibility criteria, administrative processes, conduct community outreach and public hearings on draft equity program, finalize and adopt Adult-Use Cannabis Ordinance and equity program.
• Commencing August 2025: Finalize administrative guidelines and implement Equity Program and Adult-Use Cannabis Ordinance.
Additional grant funding may be applied for in the future through this grant program to assist with implementation and ongoing administration of a cannabis equity program.
The amount available for request varies each year based on available State funds. 5 of 6
Environmental Analysis
The acceptance and use of grant funding is categorically exempt from CEQA pursuant to Section 15061(b)(3) of the CEQA Guidelines. The grant activities are covered by the common sense exemption which states that CEQA does not apply, “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.” The grant will allow the City Planning Division to develop a Cannabis Equity Program in concert with the establishment of an Adult-Use Cannabis Ordinance. Therefore, it can be seen with certainty that the grant would not result in adverse physical impacts on the environment, and as such, is categorically exempt from CEQA.
Past Council Actions
Meeting Date Description
06/13/23 (Attachment A) Adult-Use Cannabis Study Session 03/19/24 (Attachment B) Adoption of Resolution for Grant Funding Financial Impacts and Budget Actions
Staff seeks the adoption of the resolution to accept the State of California Cannabis Equity Grand Funding for $35,000. Adoption of the resolution requires the following budget amendment:
FY 2024-25 Grant Budget Amendment
Fund Establish Revenue Budget Appropriate Funds
Account Number Amount Account Numbers Amount
Miscellaneous
Grants
20700002.406060 $35,000 20800002.69XXXX
(transfer out)
$35,000
General Fund 01800001.69XXXX
(transfer in)
($35,000)
If renewals or additional grant funding is awarded, budget changes will be included in subsequent year budgets, contingent on Council budget approval. 6 of 6
Prepared By: Tony Kim, Principal Planner
Approved Forwarded to Council
Attachments:
A. June 13, 2023 Council Meeting Adult-Use Cannabis Study Session (Web Link) B. March 19, 2024 Council Meeting Adoption of Resolution for Grant Funding (Web Link)
C. Cannabis Grant Resolution
D. Written Comment