1 City Council Meeting: January 13, 2026 Santa Monica, California RESOLUTION NUMBER _________ (CCS)
(City Council Series)
AN RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
SANTA MONICA ADOPTING AN UPDATED SANTA MONICA CANNABIS EQUITY
PROGRAM MANUAL
WHEREAS, the City of Santa Monica supports the development of a local cannabis equity program; and
WHEREAS, on April 23, 2024, Council authorized staff to conduct a cannabis equity assessment and develop a local equity program; and WHEREAS, staff conducted and prepared a Cannabis Equity Assessment to identify communities that have been disproportionally impacted by the enforcement of cannabis-related laws and crimes; and
WHEREAS, assessment findings were used to inform the creation of the Cannabis Equity Program (“Program”); and
WHEREAS, the Program aims to recognize and address the ongoing negative social impact associated with the disproportionate enforcement of cannabis policies on certain communities in the City; and
WHEREAS, long-term impacts from the criminalization of cannabis include social stigma of criminal conviction and incarceration, family and community disintegration, permanent loss of property, disqualification from employment opportunities, reduced earnings potential, exclusion from public benefits, and inability to vote in public elections; and
2 WHEREAS, the Program implements a focused and equitable program that balances access, oversight, and community benefit; and
WHEREAS, the Program’s elements respond directly to the City’s scale, market conditions, and resources while aligning with the broader goals of social equity, community reinvestment, and local economic inclusion, with the goal of creating a lean, high-impact program that delivers meaningful benefits to those disproportionately affected by cannabis enforcement while remaining practical and sustainable; and WHEREAS, the City Council has determined that grant funds from the Governor’s Office of Business and Economic Development are available and can be used to assist local equity applicants and licensees throughout local equity program for commercial cannabis activity as described in its application for grant funds; and WHEREAS, on September 9, 2025, the City Council adopted Resolution No. 11699 (CCS) adopting a Santa Monica Cannabis Equity Assessment and Program Manual; and
WHEREAS, following the Council’s adoption of the Program, staff received guidance from the Governor’s Office of Business and Economic Development (GO-Biz) regarding the City’s implementation of the Program and to better align the City’s Program eligibility criteria with criteria required by the Department of Cannabis Control (DCC), which is a requirement to be eligible for potential future cannabis equity State grant funding; and
3 WHEREAS, the proposed updates to the Program eligibility criteria are consistent with the guidance provided by GO-Biz and also include minor revisions in other sections of the Program to reflect the Council’s actions from September 9, 2025; and WHEREAS, additionally, the updates to the eligibility criteria address recent challenges to cannabis equity programs in other jurisdictions such as Los Angeles County.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES HEREBY ORDAIN AS FOLLOWS:
SECTION 1. The City Council of the City of Santa Monica adopts an updated City of Santa Monica Cannabis Equity Program Manual, as set forth in Exhibit A.
SECTION 2. The City will continue to evaluate the Program to address any disparate, negative impacts of cannabis-related regulation and enforcement in the City of Santa Monica.
SECTION 3. The City Clerk shall certify to the adoption of this Resolution, and thenceforth and thereafter, the same shall be in full force and effect.
APPROVED AS TO FORM:
_________________________
Heidi von Tongeln
Interim City Attorney
EXHIBIT A
CANNABIS EQUITY PROGRAM MANUAL
1 City of Santa Monica
Cannabis Equity Program January 2026
Cannabis Equity Program
Table of Contents
1. Program Purpose
2. Definitions
3. Program Eligibility
4. Program Benefits and Services
5. Program Administration, Monitoring and Evaluation
1. Program Purpose
The Cannabis Equity Program (“Program”) seeks to reduce the barriers of entry and participation for individuals that have been negatively impacted by the disproportionate enforcement of cannabis related crimes by providing them access into the legal cannabis industry. The Program aims to recognize and address the ongoing negative social impact associated with the disproportionate enforcement of cannabis policies on Black, Indigenous, and people of color (BIPOC) and low-income communities in the City. Long-term impacts from the criminalization of cannabis include social stigma of criminal conviction and incarceration, family and community disintegration, permanent loss of property, disqualification from employment opportunities, reduced earnings potential, exclusion from public benefits, and inability to vote in public elections.
As a relatively small city of only 8.5 square miles, Santa Monica faces different constraints and opportunities than larger cities like Los Angeles, Oakland, or Long Beach. While many cannabis equity policy frameworks draw from statewide best practices and lessons from other jurisdictions, it was appropriate for Santa Monica to implement a more tailored approach to cannabis equity.
At the direction of City Council, this Program implements a focused and equitable program that balances access, oversight, and community benefit. The 2 City of Santa Monica
Cannabis Equity Program January 2026
program elements respond directly to the City’s scale, market conditions, and resources while aligning with the broader goals of social equity, community reinvestment, and local economic inclusion. The overarching goal is to create a lean, high-impact equity program that delivers meaningful benefits to those disproportionately affected by cannabis enforcement while remaining practical and sustainable.
2. Definitions
Except for as provided herein, for purposes of the Program, the words and phrases defined in Chapter 6.200 of the Santa Monica Municipal Code shall have the same meaning herein. Further, the following words and phrases shall have the meanings respectively ascribed to them by this section:
a) "Business" means a firm, organization, association, partnership, business trust, corporation, company, or like entity.
b) “Business equity applicant” means an individual or group of individuals who own 50% or more of the equity business and meet the Individual Criteria.
c) "Cannabis equity program" or ''the Program" means the City of Santa Monica Cannabis Equity Program.
d) “Immediate family member" means an individual who had a parent, legal guardian, child, spouse, or dependent, or was a dependent of an individual who was arrested for, convicted of, or adjudged to be a ward of the juvenile court for any non-violent crime under the laws of California or any jurisdiction relating to the sale, possession, use, cultivation, manufacture, or transport of cannabis.
e) “Individual" means a person.
f) “Individual equity applicant” means an individual meeting the Individual Criteria
g) “Low-income individual" means an individual who currently (at the time of licensing) lives in a household with a household income that is at or below 60 percent of the Area Median Income (AMI) for the county of residence, as determined by the United States Department of Housing and Urban Development or its successor agency, and net worth below $250,000. 3 City of Santa Monica
Cannabis Equity Program January 2026
h) "Program participant" or "participant" means an individual or a business that has been accepted into the Program.
i) “Qualifying Census Tract” means tracts that have 50% of households with incomes below 60% of the Area Median Gross Income or have a poverty rate of 25% or more.
3. Program Eligibility for Equity Applicants
The City’s eligibility standards are based on cannabis-related conviction history, low-income status, and Santa Monica residency (current or former), as these qualifiers aim to address those who have been historically shown to be the most impacted as described in Santa Monica’s Cannabis Equity Assessment (July 2025).
Individual Criteria*
Individuals may be considered an equity applicant if they an owner of a cannabis business and satisfy two of the following three equity criteria:
• Cannabis Conviction or Arrest. Individuals who have been or have immediate family members who have been arrested or convicted for cannabisrelated offenses before November 8, 2016:
▪ Individuals with a past cannabis-related arrest or conviction. ▪ Immediate family members (as defined herein) of individuals with cannabis-related arrests or convictions, recognizing the intergenerational consequences of cannabis enforcement.
Rationale:
The Equity Assessment data from 1993-2023 confirms that Black/African American and Hispanic/Latino communities have been disproportionately criminalized. Restricting eligibility to Santa Monica arrests would exclude many individuals who were impacted but later moved due to displacement, gentrification, or economic hardship.
Including immediate family members helps the program reach those indirectly affected.
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Cannabis Equity Program January 2026
• Household Income. Require applicants to meet a clearly defined lowincome threshold to ensure resources benefit those most in need. ▪ Set eligibility at household income less than or equivalent to 60% of the Area Median Income (AMI) for the local jurisdiction where individuals live.
Rationale:
Establishing clear financial criteria prevents the program from being exploited by individuals who do not face significant economic barriers. A well-defined low-income threshold ensures resources are allocated to those who need them most. A threshold of 60% of the Area Median Income (AMI) is a standard used by other cannabis equity programs across the state.
• Neighborhood Criteria. Individuals who have lived for at least five years between 1980 and 2016 within Los Angeles County, impacted by past criminal justice policies implementing cannabis prohibition, and the owner meets one of the following two criteria:
▪ Resided in a qualifying census tract within Los Angeles County ▪ Has an immediate family member who was arrested or convicted of a cannabis-related offense prior to November 8, 2016.
Rationale:
Prioritizing applicants who have lived in the most impacted neighborhoods may limit the program’s effectiveness and reach.
Requirements should consider both current and former Santa Monica residents who lived in disproportionately affected areas. *May be amended from time-to-time based upon developments in the law.
Business Eligibility
The cannabis equity business must meet the following criteria:
• Equity ownership. Individuals who either individually or in combination with the other owners who meet the equity criteria above must own 50% or more of the business.
Rationale:
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Cannabis Equity Program January 2026
Setting a majority ownership requirement ensures equity applicants benefit from the program while allowing flexibility in investment structures. Many California equity programs require at least 50% equity ownership to ensure that social equity partnerships retain control over their businesses and are not exploited by outside investors.
4. Program Benefits and Services
A Program participant shall be entitled to receive the following benefits and services:
a. Core Program Elements and Services. These are the minimum essential program elements and services the City should implement immediately. They focus on lowering barriers to entry for equity applicants while having a streamlined and efficient administrative process.
• Financial:
o Application and permit fee waivers or deferrals for qualified equity applicants.
• Application and Licensing:
o Provide equity applicants with expedited application
processing and review.
o Require disclosure of ownership and profit-sharing
agreements during licensing to ensure equity applicants are protected.
• Administrative, Legal, and Technical Assistance:
o Connect equity applicants with existing business development and cannabis industry resources.
o Refer equity applicants to pre-vetted legal aid groups and small business assistance providers, and workforce
development organizations to administer direct services to equity applicants.
o Collaborate with the County District Attorney’s Office and Public Defender for expungement workshops.
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Cannabis Equity Program January 2026
• Outreach and Program Information:
o The City’s Cannabis Equity Program webpage will provide clear program information online in multiple languages. o The City’s DEI Office will assist in marketing the Cannabis Equity Program.
o Targeted outreach to historically impacted communities using digital platforms, flyers, and community-based partnerships. b. Expanded Program Services with State Grant Funding. Subject to the availability of State funding, if the City receives Type 2 funding from the California Cannabis Equity Grants Program for Local Jurisdictions administered by GO-Biz, the City could significantly expand its equity program beyond baseline services above. Under current grant program guidelines, which are subject to change, the City may apply for up to $500,000 in grant funds without providing a local one-to-one funding match.
Up to 10% of the grant may be used for city administrative costs and an additional 10% may be allocated to consultant services, such as providing technical assistance or grant support. The remaining 80% must be distributed directly to equity applicants in the form of grants or other eligible direct financial assistance. The following are potential program enhancements that may be feasible with this funding.
• Direct Financial Assistance:
o Start-up Grants or Fee Waivers: Provide micro-grants ($5,000– $25,000 range) to equity applicants to cover local or state licensing fees, professional services, or first-year operating expenses.
o Lease Assistance or Rent Subsidies: Offer limited-term subsidies to help equity applicants secure compliant locations in Santa Monica.
• Expanded Legal and Technical Support:
o One-on-One Professional Services Vouchers: Offer
subsidized access to vetted legal, financial, and
technical consultants (e.g., for corporate formation,
tax planning, or security planning).
o Compliance Readiness Checks: Fund pre-inspection
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walkthroughs to help applicants meet local code and
Department of Cannabis Control (DCC)
requirements before final inspections.
5. Program Administration, Monitoring and Evaluation
The Program will be executed administratively in compliance with the administrative guidelines in Article 6 of the municipal code.
The City will evaluate, monitor and share progress of the Program, including number of participants and participant success, measured by the number of participants either ready to obtain or that have obtained a cannabis business operating permit. The City may expand the eligibility and benefits of the program.
The evaluation of the Program should include any ongoing barriers to entry and participation, evaluations of the Equity Study, and recommended solutions as needed to advance equity.