Title
a. Receive information and provide direction regarding proposed amendments to Monterey County Code Chapter 7.90 and Titles 20.67 and 21.67 related to commercial cannabis retail operations; and
b. Receive recommendations from the Cannabis Committee’s regarding the proposed amendments; and
c. Direct staff to either immediately prepare proposed amendments or combine the amendments with the work currently being prepared by an outside consultant for Monterey County Code Chapter 7.90 and Titles 20.67 and 21.67 by early 2023; and
d. Provide further direction as appropriate. (REMOVED VIA SUPPLEMENTAL)
Report
RECOMMENDATIONS:
It is recommended that the Board of Supervisors Cannabis Committee:
a. Receive information and provide direction regarding proposed amendments to Monterey County Code Chapter 7.90 and Titles 20.67 and 21.67 related to commercial cannabis retail operations; and
b. Receive recommendations from the Cannabis Committee’s regarding the proposed amendments; and
c. Direct staff to either immediately prepare proposed amendments or combine the amendments with the work currently being prepared by an outside consultant for Monterey County Code Chapter 7.90 and Titles 20.67 and 21.67 by early 2023; and
d. Provide further direction as appropriate.
SUMMARY/DISCUSSION:
Following the July 7, 2022, Cannabis Committee (Committee) meeting, Cannabis Program (Program) staff received a comment intended to be given during the public comment period but that, for technical reasons, was not received. This comment expressed concern about a lack of progress towards reviewing Monterey County Code (MCC) regulations for the signage of cannabis-related businesses that depict cannabis, the requirement to shade building windows, and the security requirement. Program staff scheduled a meeting with the 8 fully licensed and permitted cannabis retailers and their Authorized Agents within the unincorporated area to discuss this issue and identify other areas of concern. Among the attendees, four areas of shared concern were identified:
1. Restrictions on signage.
Pursuant of MCC section 7.90.100(A)(11), graphics depicting cannabis or cannabis products shall not be visible from the exterior of the premises. Staff has received confirmation from the Department of Cannabis Control (DCC) that there are current regulations share no such restriction. Staff has researched the regulations of other local jurisdictions and captured the logos of several cannabis programs that depict cannabis (Attachment A).
Retailers claim that existing local regulations undermine their ability to attract customers, a challenge that non-cannabis retailers are not faced with. Local retailers would like to depict cannabis within their signage,
Staff has conducted research and site visits to commercial cannabis retail operations as far north as San Francisco, including Contra Costa County, Alameda County, and the local cities of Seaside and Del Rey Oaks. Cannabis retail franchises may be permitted to depict cannabis within their signage within other jurisdictions, but not within the unincorporated area of Monterey County; this restriction could negatively affect branding efforts.
In staff’s research and site inspections, they found that 5 of the 11 retailers visited depicted cannabis within their signage: 4 were artistic interpretations and 1 was a realistic silhouette.
The Cannabis Committee recommends allowing the use of signage depicting cannabis that is visible from the exterior of the premises.
2. Allow transparent public-facing windows.
Local retailers are required to shade their windows to obscure visibility of cannabis products available for sale. Some local retailers believe that the removal of this requirement would assist with merchandising efforts and drive consumer interest.
In staff’s research and site inspections, they found that 9 of the 11 retailers visited had shaded windows.
The Cannabis Committee recommends allowing transparent public-facing windows to be at the discretion of the retailer owner.
3. Security personnel.
Pursuant to MCC section 21.67.040(B)(5)(e) and DCC Regulation § 15045, retailers must hire or contract on-site security who are licensed by the Bureau of Security and Investigative Services.
Local retailers would like to have the option for internal employees to conduct security operations as opposed to being required to hire third party security firms, which are cost prohibitive.
Staff conducted research and found that of the 2 of the 11 retailers visited had security guards outside and the remainder had security inside.
Staff from the District Attorney expressed a concern with employees being tasked with potentially competing interests of servicing the business and ensuring facility security.
The Cannabis Committee recommends the retail business owner is allowed discretion on their security personnel as long as it meets the DCC regulations.
4. Hours of operation.
Pursuant to MCC section 21.67.040(D)(6), the operating hours of cannabis retailers within the unincorporated area are between 8:00 am and 8:00 pm. Pursuant to DCC Regulations § 15403, the operating hours of cannabis retailers are between 6:00 am and 10:00 pm.
Local retailers would like to remain open for longer, primarily because this would allow them to compete with delivery services that are located outside of the County and are not subject to the 8:00 pm limit. Attendees argued that extended operating hours would result in higher gross receipts and the County would benefit through increased tax revenue. Staff does not have an estimate for incremental sales that would result from this local policy change.
The Cannabis Committee recommends extending the operating hours of business operations and the full Board will determine those hours.
PROPOSED AMENDMENTS:
The Program maintains a list of proposed amendments to Chapter 7.90, determined by lessons learnt from administering the chapter, feedback received during cannabis industry meetings, and changes resulting from the consolidation of the three state cannabis licensing bureaus. Staff is working in collaboration with Housing and Community Development and has entered into an agreement with an outside vendor to prepare amendments to Monterey County Code Chapter 7.90 and Titles 20.67, 21.67, 20.69 and 21.69. Since some of the amendments will require approval by the Planning Commission than the full Board, staff anticipates all amendments will be brought to the full Board for review and approval in early 2023. The Authorized Authority of MCC Chapter 7.90 has made interpretations of 7.90.100(A)(11) be used to address concerns 1 and 2 during the interim while working on formal ordinance amendments (Attachment B).
OTHER AGENCY INVOLVEMENT:
The Office of the County Counsel, District Attorney, and Housing and Community Development were involved in the preparation of the report.
FINANCING:
Monterey County’s Cannabis Program is funded in County Administrative Office - Department 1050, Intergovernmental and Legislative Affairs Division - Unit 8533, Cannabis. The proposed recommendations will not incur additional expenses to the Program.
BOARD OF SUPERVISORS STRATEGIC INITIATIVES:
The Monterey County Cannabis Program addresses each of the Strategic Initiative Policy Areas that promote the growth of a responsible and legal Monterey County cannabis industry.
Mark a check to the related Board of Supervisors Strategic Initiatives
X Economic Development
X Administration
X Health & Human Services
X Infrastructure
X Public Safety
Prepared by: Joann Iwamoto, Program Manager II
Approved by: Nicholas E. Chiulos, Assistant CAO
Attachments:
A. Cannabis signage regulations and retail storefronts of outside jurisdictions
B. Authorized Authority Interpretation of Monterey County Code Chapter 7.90