Title
REF150048 - CANNABIS ENTITLEMENTS AND DISPENSARY SETBACKS
(Continued from September 12, 2018)
Public hearing to consider making a recommendation to the Board of Supervisors regarding amendments to Title 21 (non-coastal zoning ordinance) and Title 20 (coastal zoning ordinance) that:
a. Change commercial cannabis activities (Includes: retailer, indoor and mixed light cultivation and nursery, volatile and non-volatile manufacturing, distribution, and testing) from a conditional use allowed subject to a Use Permit/Coastal Development Permit in each case within specified zoning districts, to a principal use allowed subject to an Administrative Permit/Coastal Administrative Permit in each case within the same specified zoning districts;
b. Create an exception process for a proposed retail facility that does not comply with the 1,500-foot setback from another approved retail facility and establish findings for consideration of such Permits.
Proposed CEQA Action: Statutorily exempt pursuant to Business and Professions Code section 26055(h).
Report
PROJECT INFORMATION:
Planning File Number: REF150048 (Cannabis Regulations)
Project Location: County-wide
Plan Area: County-wide
RECOMMENDATION:
Based on staff’s understanding of the Planning Commission’s direction, staff recommends adopting a Resolution recommending that the Board of Supervisors:
a. Find the project is the adoption of commercial cannabis regulations that require subsequent discretionary permits that are themselves subject to CEQA review, and therefore is statutorily exempt from CEQA the pursuant to Business and Professions Code Section 26055(h) if adopted prior to July 1, 2019.
b. Adopt an ordinance to amend Title 21 (non-coastal zoning ordinance) and a resolution of intent to adopt Title 20 (coastal zoning ordinance) to:
i. Change commercial cannabis activities (Includes: retailer, indoor and mixed light cultivation and nursery, volatile and non-volatile manufacturing, distribution, and testing) from a conditional use allowed subject to a Use Permit/Coastal Development Permit in each case within specified zoning districts, to a principal use allowed subject to an Administrative Permit/Coastal Administrative Permit in each case within the same specified zoning districts;
ii. Require a Use Permit/Coastal Development Permit for a proposed retail facility that does not comply with the 1,500-foot setback from another approved retail facility and establish mandatory findings for consideration of such Permits.
Although proposed together in each ordinance, the Planning Commission may consider the change in permit requirements and modification to retail facility setbacks individually. Changes to permit requirements can proceed independent of the retail facility setback amendments and vice versa.
In taking the above action, the Planning Commission recommendation on the draft ordinance developed through the Board Cannabis Committee is that the Board of Supervisors decline to adopt that draft ordinance amending Title 21 (non-coastal zoning ordinance) and draft resolution of intent to adopt Title 20 (coastal zoning ordinance) of the Monterey County Code that would:
a. Change commercial cannabis activities (Includes: retailer, indoor and mixed light cultivation and nursery, volatile and non-volatile manufacturing, distribution, and testing) from a conditional use allowed subject to a Use Permit/Coastal Development Permit in each case within specified zoning districts, to a principal use allowed subject to an Administrative Permit/Coastal Administrative Permit in each case within the same specified zoning districts;
b. Create an exception to the 1500-foot setback required between commercial cannabis retailers if applicant provides proof based on substantial evidence that special circumstances exist (“Minor Exception”); and
c. Require a Use Permit/Coastal Development Permit for a proposed retail facility that does not comply with the 1,500-foot setback from another approved retail facility and when special circumstances do not exist (“Major Exception”).
SUMMARY:
This item was continued from the September 12, 2018 Planning Commission hearing. The project involves consideration of amending cannabis regulations in coastal and inland Zoning Codes relative to:
1) Commercial cannabis permit requirements; and
2) Setbacks required between cannabis retail facilities.
On September 12th, the Commission considered draft ordinances that were developed through the Board of Supervisors Cannabis Committee. There was general agreement for amending the inland and coastal zoning to change the permits required for commercial cannabis activities from a Use Permit/Coastal Development Permit to an Administrative Permit/Coastal Administrative Permit in each case. However, the Planning Commission voted to continue the hearing to October 10, 2018 and provided direction to staff to consider revisions to the ordinances that would revise the minor and major exceptions to the 1,500-foot setback required between cannabis dispensary/retail facilities. The Commission preferred regulations that would require a Use Permit/Coastal Development Permit for any proposal for a commercial cannabis activity that fails to meet one or more of the criteria in the regulations, and development of findings required for the consideration of such permits.
Staff has considered the comments and direction provided by the Planning Commission at the September 12, 2018 hearing, and has re-drafted the ordinances to maintain the previously proposed revisions to the permit process (Administrative Permit) but require a Use Permit (non-coastal) or Coastal Development Permit (coastal) for modifications to the 1,500-foot setback required between dispensaries. In reviewing the Use Permit/Coastal Development Permit for a modification to the setback, the Planning Commission would consider a report from Monterey County Public Health and would be required to make mandatory findings in order to grant the permit. Draft findings within the updated ordinances attempt to capture the criteria and circumstances at issue in review of permits for dispensaries that do not comply with the required setback.
This staff report and the attached resolution are written for the Planning Commission to decline to adopt the draft ordinances considered at the September 12, 2018 Planning Commission hearing and recommend that the Board adopt the draft ordinances prepared following the September 12 hearing. This will provide the Board with the opportunity to consider the ordinance developed in coordination with the Cannabis Committee and recommended for denial by the Planning Commission as well as the ordinance recommended for adoption by the Planning Commission. Information on the ordinances previously presented to the Planning Commission can be found in the staff report and attachments provided for the September 12, 2018 Planning Commission hearing.
For the purposes of this report and hearing, staff and the Board of Supervisors seek a recommendation from the Planning Commission on the draft zoning ordinance amendments described above in accordance with California Government Code Section 65853. The Planning Commission’s recommendation will be transmitted to the Board of Supervisors for consideration. Board hearings on all of the relevant regulatory updates are anticipated to occur next month (November 2018). Following Board action on the ordinance updates, the Coastal zoning ordinance (Title 20) will be transmitted to the Coastal Commission for certification.
Additional information on the draft ordinance is provided in the discussion below.
DISCUSSION:
On September 12, 2018, the Planning Commission considered draft ordinances addressing cannabis permitting process and cannabis retail facility setbacks and continued the hearing with direction to staff to consider revising the ordinances to remove the minor exception criteria for cannabis retailer facility setbacks and to update the Use Permit/Coastal Development Permit process and requirements for consideration of permits that do not comply with regulations applicable to cannabis, not only the dispensary setback requirements.
Staff has considered the direction of the Planning Commission provided at the September 12, 2018 hearing and has drafted new ordinances for Planning Commission consideration. The updated draft ordinances would maintain revisions to the permitting process but would modify the process and criteria for consideration of modification to the setback required between dispensaries. The redrafted ordinances would:
1) Change in permit requirements from Use Permit/Coastal Development Permit to Administrative Permit/Coastal Administrative Permit. - Not changed from September 12, 2018; and
See staff report prepared for the September 12, 2018 Planning Commission hearing.
2) Establish a process and criteria for review of cannabis retailer setbacks. - Modified from the ordinances presented on September 12, 2018
The Monterey County Code requires that cannabis retailers (also referred to as “dispensaries”) be located more than 1,500 feet from another dispensary. These setbacks were established to distribute the density of dispensaries and to align with anticipated state regulations. However, the setbacks have created challenges processing applications and current state law does not specifically limit potential densities of dispensaries. To address local permitting challenges, staff has been directed to explore amending the setback requirement between dispensaries.
On February 14, 2018, staff presented draft ordinances to the Planning Commission that would have deleted the 1,500-foot setback and instead required a review of public convenience and necessity. These draft ordinances were discussed, and ultimately recommended for adoption by the Planning Commission to the Board. The Board found the public convenience and necessity criteria unclear and directed staff to return to the Cannabis Committee for additional discussion and direction. Staff revised the retailer setback requirements as directed by the Cannabis Committee. Having made substantial revisions to the previously considered ordinance, staff returned to the Planning Commission for review and recommendation of the revised ordinance on September 12, 2018.
With respect to cannabis dispensary setbacks, the draft ordinances presented to the Planning Commission on September 12, 2018 would have:
1) Created a “Minor Exception” to the 1,500-foot setback required between retail facilities if a retailer would be located in a Community Area, Rural Center, or “Large Shopping Center”, and would not result in more than 3 retail facilities within a Community Area or 2 retail facilities within a Rural Center or Large Shopping Center. “Large Shopping Center” is defined in the ordinance and detailed below. The Chief of Planning would be the appropriate authority to consider whether the criteria is met; and
2) Created a “Major Exception” for retail facility applications that do not qualify for the Minor Exception. The major exception would have required an applicant obtain a Use/Coastal Development Permit if there is an existing retail facility within 1500 feet. The Planning Commission would be the appropriate authority to consider these permits.
At the hearing, the Planning Commission voted to continue consideration of a recommendation to the Board of Supervisors on the ordinances to October 10, 2018 and provided direction to staff to return with revised ordinances that eliminate the “minor exception/major exception” and create a Use Permit/Coastal Development Permit process with applicable criteria for consideration of cannabis applications that do not comply with adopted cannabis regulations in Monterey County Code.
As drafted, the revised ordinances would require a Use Permit (Inland) or Coastal Development Permit (coastal) for any dispensary application that does not comply with the 1,500-foot setback requirement. The Planning Commission is designated as the Appropriate Authority to consider these permits and the Planning Commission would be required to consider a report from Monterey County Public Health and make three mandatory findings in order to grant a Use Permit/Coastal Development Permit. The three required findings include:
1. The retailer, as proposed, has demonstrated there are special circumstances applicable to subject property and within the project vicinity, including but not limited to location within a community area, rural center, or large shopping center.
2. The retailer, as proposed, will not result in a density or concentration of retailers in the community, as compared to the density of retail facilities existing in other communities, that would do any of the following:
a. Disproportionately impact a low-income community;
b. Disproportionately impact a community with a high proportion of youth; or
c. Adversely impact the public health of persons residing or working in the community.
As mentioned in the summary, the revised ordinances are limited to modification of the 1,500-foot setback required between dispensaries rather than a more general process for modifications to other regulations. The revisions to the ordinances are limited to the issue of setbacks between dispensaries rather than a more general process for exceptions to other regulations because the majority of the regulations applicable to commercial cannabis operations are mandated by state law and exceptions to state mandated criteria would not be permissible. However, there are some regulations that could be modified through ordinance. Those regulations which could be legally modified through a planning process include:
• Setbacks between dispensaries (Included in this ordinance revision)
• Setbacks from schools, playgrounds, daycare facilities, and youth centers (updated earlier this year)
• Zoning district allowances
• Outdoor cultivation
• Cultivation within a structure legally established before January 1, 2016; and
• Environmental mitigations including odor policies, water conservation measures, renewable energy generation and energy efficiency measures, and alternative fuel vehicle requirements.
Staff considered options for providing exceptions to some or all of the above-mentioned regulations. These are complex issues, and there would be policy implications involved with variations to these regulations. If it is the desire of the Commission to create broad exception criteria via a Use Permit/Coastal Development Permit process, rather than the typical variance or zoning amendment processes, staff recommends that a separate effort be undertaken.
In analyzing the various options presented thus far, staff recognizes that formal policy decisions on variables such as maximum permissible densities of retail facilities are difficult to determine but would provide more detailed guidance in consideration of individual permits for staff, the public, and decision makers. Conversely, the ability to review permits on a case-by-case basis provides decision makers the desired flexibility and discretion in the permitting process but makes decisions on appropriate densities and locations more ambiguous and subject to interpretation for individual projects. Staff, the Planning Commission, the Board of Supervisors, and the Cannabis Committee have all struggled to balance many of these factors through the development of these draft ordinances. Ultimately, this is a policy decision for the Planning Commission and the Board of Supervisors.
California Environmental Quality Act (CEQA):
The state legislature provides a statutory exemption from CEQA for consideration and adoption of local commercial cannabis regulations that require subsequent discretionary permits that are themselves subject to CEQA review. (Business and Professions Code section 26055(h)). This statutory exemption expires July 1, 2019. The County’s draft ordinances require an Administrative/Coastal Administrative Permit for all commercial cannabis activities, and these permits are individually subject to CEQA review. Therefore, these ordinances are statutorily exempt from CEQA review pursuant to Business and Professions Code section 26055(h).
OTHER AGENCY INVOLVEMENT:
The following agencies and departments have been involved in preparation of the draft ordinances:
Resource Management Agency
CAO’s Office
Health Department
County Counsel’s Office
FINANCING:
RMA made these amendments a priority based on Board direction, and utilized existing staff to complete the work. Funding for staff time associated with this ordinance development is included in the FY18-19 adopted Budget for the agencies and departments involved.
Prepared by: Craig W. Spencer, Supervising Planner, x5233
Reviewed by: Brandon Swanson, RMA Planning Services Manager
Approved by: John M. Dugan, FAICP, RMA Deputy Director of Land Use and Community
Development
The following attachments are on file with the RMA:
Exhibit A - Draft Resolution:
Recommended for denial - Draft ordinances from September 12, 2018
Attachment 1 - A Draft Ordinance amending Title 21 (inland zoning)
Attachment 2 - A Draft Ordinance amending Title 20 (coastal zoning)
Recommended for adoption - Revised Draft ordinances from October 10, 2018
Attachment 3 - A Draft Ordinance amending Title 21 (inland zoning)
Attachment 4 - A Draft Ordinance amending Title 20 (coastal zoning);
Exhibit B - Map Illustrating Community Areas, Rural Centers, and Large Shopping Centers
Exhibit C - Map Illustrating areas with a High Percentage of Youth
Exhibit D - Chapter 21.67 (recommended for revision in ordinances attached to Exhibit A)
cc: Front Counter Copy; Planning Commission; RMA-Environmental Services; Environmental Health Bureau; Water Resources Agency; California Coastal Commission; RMA-Code Enforcement; Health Department; Economic Development; County Counsel; Sheriff; Treasure/Tax Collector; Agricultural Commissioner; District Attorney; CAO’s Budget Office; CAO’s office; Jacqueline R. Onciano, RMA Services Manager; Craig Spencer, Project Planner; The Open Monterey Project (Molly Erickson); Land Watch; John H. Farrow; Janet Brennan; George Brehmer; All interested parties requesting notice of Cannabis regulations; Planning File REF150048