5.30.070 Cannabis retailer application procedure.
(1) Within 90 days following the effective date of this chapter, the city manager, pursuant to CMC 5.30.210, shall, as a ministerial duty, make available the necessary forms, adopt any necessary application rules for the submission, intake, review, and approval of retail cannabis business permit applications for retailers up to the maximum number of retail cannabis business permits authorized in CMC 5.30.050.
(2) The city manager shall, as a ministerial duty, cease acceptance of retail cannabis business permit applications 30 days after making available the necessary forms and adopting any necessary application rules for the submission, intake, review, and approval of retail cannabis business permit applications for retailers.
(3) Within 60 days of ceasing the acceptance of retail cannabis business permit application for retailers, the city manager shall, as a ministerial duty, review timely submitted retailer applications for the following minimum requirements:
(a) Payment of an application fee established by resolution of the city council within 60 days following the effective date of this chapter to cover all costs incurred by the city in the application process;
(b) Sufficient evidence of the legal right to use the proposed property for the proposed use, to include a lease, sublease, purchase agreement, assignment of purchase agreement, or lease or purchase option, in the name of the applicant, which may include nominal consideration and be contingent upon issuance of a retail cannabis business permit or other approvals. The city shall only consider one applicant per property address or county assessor’s identification number. In the event that more than one applicant applies for a retail cannabis business permit application at a given property address or a given county assessor’s identification number, the city manager shall, as a ministerial duty, only accept the retail cannabis business permit application with the earliest effective date for the evidence of the legal right to use the proposed property for the proposed use in the name of the applicant;
(c) Sufficient evidence to demonstrate that the proposed property complies with the location and zoning requirements in CMC 5.30.060;
(d) Proof that an owner or owners of the applicant with an aggregate ownership interest of 50 percent or more has served as an owner or owners with an aggregate ownership interest of 50 percent or more of four or more other cannabis retailers licensed by a city, county, or state since at least January 1, 2022;
(e) Proof of funds showing that the applicant has access and control of over $500,000 in liquid assets (which such liquid assets having been under possession for at least 90 days prior to the date of the application submission under this section), which may be shown via a binding legal agreement in the name of the applicant such as a promissory note so long as said legal agreement is accompanied by a proof of funds in the name of a party to the agreement that demonstrates access and control of over $500,000 in liquid assets under possession for at least 90 days prior to the date of the application submission under this section. Applicants and permittees shall not be required to show that the applicant or permittee has access and control of over $500,000 in liquid assets except on initial application pursuant to this section, a change in location application pursuant to CMC 5.30.130, or an ownership transfer application pursuant to CMC 5.30.140;
(f) For an applicant with two or more employees, proof of a labor peace agreement between a bona fide labor organization and the applicant (the applicant shall provide the city with a copy of the labor peace agreement that contains the signatures of the union representative and the cannabis business). For applicants with less than two employees who have not yet entered into a labor peace agreement, the applicant shall provide a notarized statement indicating that the applicant will enter into and abide by the terms of a labor peace agreement within 30 days after employing two employees;
(g) A set of plans, including a site development plan, floor plan(s), building elevations (all four sides), and a conceptual landscape plan with the percentage of landscaping in the parking lot, setback areas, and tree size and species;
(h) Colored interior and elevation renderings;
(i) A completed background check application and receipt for each owner and manager of the applicant pursuant to CMC 5.30.180(12); and
(j) The following application components: (i) qualifications of the applicant’s owners and managers; (ii) business and operations plan; (iii) security plan; (iv) safety plan; (v) neighborhood compatibility plan; (vi) labor and employment plan; and (vii) community benefits plan.
The city manager shall, as a ministerial duty, reject any retail cannabis business permit application that fails to meet the minimum requirements contained in this subsection (3), and applicants shall not have the right to supplement or amend their retail cannabis business permit applications.
(4) Within 90 days of completing the application review under subsection (3) of this section, the city manager shall, as a ministerial duty, review and score any complete applications pursuant to the following objective review criteria according to the following quantitative evaluation scale:
(a) Qualifications of the Applicant’s Owners and Managers – 150 Points. The people of the city find that a proven track-record of cannabis retailer operations that successfully generate tax revenue carries out the purpose and intent of the measure and are, therefore, critical for an applicant to demonstrate the qualifications of the applicant’s owners and managers. Accordingly, 100 of the 150 points awardable under this subsection shall only be awarded, as a ministerial duty, if an owner or owners of the applicant with an aggregate ownership interest of 50 percent or more is currently at the time of application submission under this section an owner or owners with an aggregate ownership interest of 50 percent or more of a single licensed and lawfully operating commercial cannabis retailer operation (excluding any nonretailer microbusiness, cultivation, manufacturing, distribution, or other nonretailer commercial cannabis operation components) that has generated at least $5,000,000 in gross receipts in a consecutive six-month period in the year immediately preceding the date of the application submission under this section, as demonstrated by tax payment receipts from, tax filings to, or tax returns filed with a city, county, or state.
The remaining 50 of the 150 points awardable under this subsection shall be awarded, as a ministerial duty, pursuant to the following objective criteria:
(i) Up to 25 Points. A description of the applicant’s owner and manager qualifications detailing any special business or professional qualifications or licenses of the applicant’s owner and manager that would add to the quality of services that the cannabis business would provide, including in areas related to cannabis, such as legal, finance, business ownership/administration, real estate development, scientific, or healthcare fields.
(ii) Up to 25 Points. Documentation that the applicant’s owners and managers have experience operating cannabis retailers in any jurisdiction where cannabis retailers are permitted.
(b) Plans, Renderings, and Overall Location – 50 Points. The 50 points awardable under this subsection shall be awarded, as a ministerial duty, pursuant to the following objective criteria:
(i) Up to 10 Points. A premise diagram in accordance with Section 5006 of Division 42 of Title 16 of the California Code of Regulations.
(ii) Up to 10 Points. A site development plan that provides information on existing conditions and proposed improvements to the site and how it meets or will meet the development standards outlined in the city zoning code. Information on existing conditions shall include:
(A) Exterior renderings or photographs showing all sides of any existing structure(s);
(B) Plans or photographs of existing parking areas, landscaping, trash enclosure, and signage;
(C) Information on existing or former use on the site, including the addresses, uses, and square footages;
(D) Plans or photographs of the existing site if the site is vacant; and
(E) Photographs of adjacent properties for context.
(iii) Up to 10 Points. A floor plan showing information on the existing layout and proposed layout of the building interior.
(iv) Up to 10 Points. Building elevations that provide information on existing conditions and proposed improvements.
(v) Up to Five Points. A conceptual landscape plan with the percentage of landscaping in the parking lot, setback areas, and tree size and species.
(vi) Up to Five Points. Colored interior renderings and exterior elevation renderings (for both existing and/or proposed improvements).
(c) Business and Operations Plan – 100 Points. The 100 points awardable under this subsection shall be awarded, as a ministerial duty, pursuant to the following objective criteria:
(i) Up to 10 Points. A written description of the total square footage of the facility with estimated square footage of proposed uses.
(ii) Up to 10 Points. A schedule for beginning operations, including a narrative outlining any proposed construction improvements and a timeline for completion.
(iii) Up to 10 Points. A budget for construction, operation, maintenance, compensation of employees, equipment costs, utility costs, and other operating costs.
(iv) Up to Five Points. A description of the sources(s) of capital and use(s) of capital.
(v) Up to 10 Points. Pro forma financial statements for at least three years of operation.
(vi) Up to Five Points. A description of the type of products to be sold and the estimated quantity and value of product(s) to be sold.
(vii) Up to Five Points. A description of marketing procedures and tactics.
(viii) Up to 10 Points. A description of day-to-day operations that should acknowledge both state and local laws and should be consistent with industry best practices.
(ix) Up to Five Points. A description of hours of operation and opening procedures.
(x) Up to 10 Points. A description of cash handling procedures.
(xi) Up to 10 Points. A description of inventory control procedures to include identification of point-of-sale systems, and track and trace software.
(xii) Up to 10 Points. A description of transportation, loading and unloading, distribution, or delivery procedures.
(d) Security Plan – 100 Points. The 100 points awardable under this subsection shall be awarded, as a ministerial duty, pursuant to the following objective criteria:
(i) Up to 20 Points. The security plan is prepared by a professional security consultant.
(ii) Up to 10 Points. A premises security diagram.
(iii) Up to 50 Points. A description of access control, inventory control, cash handling, and other security procedures and security equipment demonstrating compliance with the security requirements under this chapter.
(iv) Up to 10 Points. A description of the intrusion alarm and monitoring system including the name and contact information for the monitoring company.
(v) Up to 10 Points. A description of the services of on-site security guards to include the (A) number of security guards; (B) the hours security guards will be on site; (C) locations where security will be positioned; and (D) security guard responsibilities.
(e) Safety Plan – 100 Points. The 100 points awardable under this subsection shall be awarded, as a ministerial duty, pursuant to the following objective criteria:
(i) Up to 20 Points. The safety plan is prepared by a professional fire prevention and suppression consultant.
(ii) Up to 10 Points. A premises safety diagram to include (A) a description/illustration of evacuation routes and (B) location of fire extinguishers and other fire suppression equipment.
(iii) Up to 50 Points.
A description of safety procedures, training for emergency situations, and safety equipment demonstrating compliance with the safety requirements under this chapter.
(iv) Up to 10 Points. Identify all gases, pesticides, and chemicals to be used and their storage locations.
(v) Up to 10 Points. A description of the firm alarm and monitoring system including the name and contact information for the monitoring company.
(f) Neighborhood Compatibility Plan – 350 Points. The 350 points awardable under this subsection shall be awarded, as a ministerial duty, pursuant to the following objective criteria:
(i) Up to 150 Points. A “good neighbor policy” that (A) includes policies and measures in place to protect adjacent uses from any potential impacts (e.g., noise, light, odor, traffic, etc.) related to the proposed cannabis business and (B) describes how the cannabis business and its operating characteristics will be proactively managed so the business is not detrimental to the public health, safety, convenience, or welfare of persons residing, working, visiting, or recreating in the surrounding area and will not result in the creation of a nuisance.
(ii) Up to 50 Points. A description of odor mitigation practices to include: (A) identifying potential sources of odor; (B) a description of odor control devices and techniques employed to ensure that odors from cannabis are not detectable beyond the permitted premises; and (C) all proposed staff odor training and system maintenance.
(iii) Up to 50 Points. A description of a waste management plan that includes waste disposal locations within the proposed premises and the applicant’s security measures and methods of rendering waste unusable and unrecognizable.
(iv) Up to 100 Points. A description of how the proposed location is suitable for the proposed cannabis retail use considering the neighboring uses in the vicinity and existing private/public improvements.
(g) Community Benefits Plan – 100 Points. The people of the city find that monetary donations to local nonprofit organizations, financial support of city sponsored activities or organizations, in kind donations to the city or other charitable organizations, and economic incentives to the city carry out the purpose and intent of the measure and are, therefore, critical for an applicant to demonstrate an effective community benefits plan. Accordingly, 50 of the 100 points awardable under this subsection shall only be awarded if the applicant pledges to voluntarily provide a public benefit to a public use (or a combination thereof), which is defined as a direct financial contribution equal to one percent of projected gross receipts of the applicant to a public school located within the city, a public park located within the city, and/or a public or nonprofit community organization serving the city or its residents, subject to annual review and final approval by the city. Beyond the above, no further direct financial contributions shall be considered as part of an applicant’s community benefits plan.
The remaining 50 of the 100 points awardable under this subsection shall be awarded, as a ministerial duty, pursuant to the following objective criteria:
(i) Up to 25 Points. A description of a social responsibility plan to include identification of a community liaison, plans to serve as a social equity business incubator, plans to aide and participate in the work of local nonprofits, community-based organizations, civic organizations, or social services organizations.
(ii) Up to 25 Points. A description of a plan to develop a public health outreach and educational program that outlines the risks of youth use of cannabis and that identifies resources available to youth related to drugs and drug addiction.
(h) Labor and Employment Plan – 150 Points. The people of the city find that a proven track-record of cannabis retailer operations with high labor standards and commitment to labor peace carry out the purpose and intent of the measure and are, therefore, critical for an applicant to demonstrate an effective labor and employment plan. Accordingly, 50 of the 150 points awardable under this subsection shall only be awarded if the applicant provides documentation that the individual or natural person owner or owners of the applicant (disregarding any intervening or intermediary entity owner or owners of the applicant) with an aggregate ownership interest of 90 percent or more have entered into collective bargaining agreements with a labor organization that currently represents cannabis workers in the United States effective since at least July 1, 2021, inclusive of renewals (and remaining effective, inclusive of renewals, on the date of the application submission under this section) and such collective bargaining agreements accrete or automatically apply to all cannabis retailers permitted or licensed in the state after July 1, 2021 (notwithstanding the fact that employees of such cannabis retailers permitted or licensed in the state after July 1, 2021, (if any) have yet to have had an opportunity to recognize the labor organization that currently represents cannabis workers in the United States), by the individual or natural person, owner or owners of the applicant (disregarding any intervening or intermediary entity owner or owners of the applicant) with an aggregate ownership interest of 90 percent or more referenced above.
The remaining 100 of the 150 points awardable under this subsection shall be awarded, as a ministerial duty, pursuant to the following objective criteria:
(i) Up to 10 Points. An organizational chart of showing owners, managers, and employees.
(ii) Up to 10 Points. A description of the owner’s and manager’s roles in day-to-day operations and decisions.
(iii) Up to 10 Points. A description of the number of employees, title/position, and their respective responsibilities.
(iv) Up to 15 Points. A description of compensation to employees, opportunities for continuing education, and employee training.
(v) Up to 15 Points. A description of whether the cannabis business is committed to offering employees a living wage.
(vi) Up to 15 Points. A description of benefits provided to employees such as health care, vacation, and medical leave, to the degree they are offered as part of employment.
(vii) Up to 15 Points. A description of a plan to recruit employees from socially and economically disadvantaged backgrounds.
(viii) Up to 10 Points. A description of a plan to have at least 50 percent of employee positions filled and hours worked by employees residing in the city.
(5) Upon timely receipt of a retail cannabis business permit application, the city manager shall conduct background checks in accordance with CMC 5.30.180(12). Following review and scoring of complete applications pursuant to objective review criteria under subsection (4) of this section, the city manager shall, as a ministerial duty, issue retail cannabis business permits to applicants in order of their rank under subsection (4) of this section up to the maximum number of retail cannabis business permits authorized in CMC 5.30.050. In the event of a tie in the order of ranking under subsection (4) of this section between one or more applicants up to the maximum number of retail cannabis business permits authorized in CMC 5.30.050, the city manager shall, as a ministerial duty, break the tie and issue retail cannabis business permits to the applicants with the highest scoring application component in the following order: (a) neighborhood compatibility of proposed location; (b) qualifications of the applicant’s owners and managers; (c) labor and employment plan; (d) security plan and safety plan; (e) community benefits plan; (f) neighborhood compatibility plan; (g) business and operations plan; and (h) plans, renderings, and overall location. In the event of a tie on all application components between one or more applicants up to the maximum number of retail cannabis business permits authorized in CMC 5.30.050, the city manager shall not hold a public lottery, but rather arrange for the tied applicants to provide public presentations before the city council, after which the city council shall publicly rank the applicants pursuant to ranking sheets prepared by the city manager that achieve a forced ranking based on all of the objective review criteria and quantitative evaluation scale in subsection (4) of this section, and the city manager shall issue retail cannabis business permits to applicants in order of their rank up to the maximum number of retail cannabis business permits available following the city manager’s original ranking and issuance of retail cannabis business permits and the limits contained in CMC 5.30.050. However, the city manager shall not issue a retail cannabis business permit to any applicant with an owner or manager that:
(a) Provided false or misleading information on the applicant’s retail cannabis business permit application;
(b) Has been convicted of (or pled no contest to) “an offense that is substantially related to the qualifications, functions, or duties of the business or profession for which the application is made” as that term is defined in Section 26057(b)(4) of the California Business and Professions Code; or
(c) Has been sanctioned by a licensing authority or a city, county, or state for unlicensed commercial cannabis activities or has had a license suspended or revoked under MAUCRSA in the three years immediately preceding the date the application was submitted.
(6) Any decision of the city manager or city council under this section shall be a final administrative decision not subject to administrative appeal under any provisions of this chapter or any provisions of this code but, rather, subject to judicial review and remedies.
(7) In the event that (a) the number of active, operating retailers and issued retail cannabis business permits falls below the maximum number of retail cannabis business permits for retailers authorized in CMC 5.30.050 or (b) the city council is ordered to increase the maximum number of retail cannabis business permits issued for retailers by a court of competent jurisdiction as a judicial remedy (e.g., if a court of competent jurisdiction orders the city council to make retail cannabis business permits available for retailers (including cannabis businesses engaged in retail sales) based outside the city to engage in delivery within the city), the city manager shall, as a ministerial duty, within 60 days reinstitute the application procedure under this section, subject to the maximum number of retail cannabis business permits for retailers authorized and available (not allocated to an active, lawfully operating retailer) for issuance. For the purpose of this section, a retailer shall be considered operating if (a) upon initial issuance of retail cannabis business permit (or approval of a change in location pursuant to CMC 5.30.130), the retailer commences lawful operations within 24 months or (b) following initial commencement of lawful operations, the retailer does not cease or abandon operations for 120 consecutive or cumulative days in any one-year period.
(8) Upon issuance of a retail cannabis business permit, the cannabis permittee shall be required to make a presentation to the city manager, the director of community development, and/or the city council and members of the public at a public noticed hearing. The purpose of the presentation is to inform the members of the public of the cannabis business permit application process, selection, location, operation and allow members of the public to provide public comment. (Ord. 730 § 5, 2022).