Red Bluff Municipal Code Art. II Commercial Cannabis Business Permit

(A) No person may engage in any commercial cannabis activity within the city unless the person:

(1) Has a valid CCBP issued by the city;

(2) Has a valid state license;

(3) Any other applicable approvals, including, but not limited to, a building permit, city business license, and a development agreement; and

(4) Is currently in compliance with all applicable state and local laws and regulations pertaining to the commercial cannabis activity including but not limited to the requirements of this chapter.

(B) (1) It shall be unlawful to rent, lease, or otherwise permit any commercial cannabis activity at any location, structure, or vehicle in the city by a person:

(a) That does not have a valid CCBP issued by the city;

(b) That does not have a valid state license;

(c) That does not have any other applicable approvals, including, but not limited to, a building permit and city business license; or

(d) That is not currently in compliance with all applicable state and local laws and regulations pertaining to the commercial cannabis activity.

(2) Property owners shall have strict liability for any commercial cannabis activity at any location, structure, or vehicle in the city by a person:

(a) That does not have a valid CCBP issued by the city;

(b) That does not have a valid state license; or

(c) That does not have any other applicable approvals, including, but not limited to, a building permit and city business license.

(C) A copy of the CCBP shall be displayed at all times in a place visible to the public. The CCBP shall be issued to the specific person or persons listed on the cannabis permit application and list the authorized business entity if applicable.

(D) A CCBP shall not be issued to any person, and no person shall engage in any commercial cannabis activity and/or have any ownership interest in a commercial cannabis business, nor shall a person be employed by or work in a commercial cannabis business, who has been convicted of a felony within the past seven years, unless that felony has been dismissed, withdrawn, expunged or set aside pursuant to California Penal Code §§ 1000, 1203.4 or 1385, or who is currently on probation or parole for the sale, distribution, possession or manufacture of a controlled substance, or who is required to register as a sex offenders pursuant to California Penal Code § 290. Exempted from these prohibitions is a conviction for a felony involving cannabis where the underlying offense has subsequently been designated as a misdemeanor or infraction or decriminalized pursuant to the provisions of MAUCRSA or other state law.

(E) Applicant shall be responsible for all fees and noticing obligations required for processing all permits.

(F) Permittees shall be and remain in compliance with all applicable state and local laws and regulations pertaining to engaging in, conducting or operating a commercial cannabis business. Permittee shall obtain any applicable state license prior to commencing operations.

(G) The City Manager shall have the authority to adopt rules and/or regulations governing the implementation of this chapter.

(H) In addition to any other requirement of this chapter, no CCBP shall be issued to any cannabis business unless and until a development agreement has been entered into by the applicant and the city pursuant to the procedures set forth in Chapter 25, Article XXVII. Such development agreement may include provisions for specified public benefit payments to the city by the applicant or permittee.

(Ord. 1063, passed 2-15-2022)

(A) The maximum numbers of commercial cannabis businesses that may be issued a CCBP per classification are as follows:

(1) Retailer-storefront: three.

(2) Retailer-non-storefront: no maximum.

(3) Testing laboratory: no maximum.

(4) Manufacturer: no maximum.

(5) Distributor: no maximum.

(6) Indoor cultivator: no maximum.

(7) Microbusiness: no maximum.

(8) Cannabis event organizer: no maximum.

(9) Outdoor commercial cultivation: zero.

(B) Each year following the initial award of permits, or at any time, the City Council may, in its sole and absolute discretion, establish by resolution the number of CCBPs which can be issued per each classification. The number of CCBPs can remain the same, be reduced, or be increased. However, nothing in this section shall authorize the revocation or non-renewal of an existing CCBP solely due to a reduction in the number of permits authorized for issuance.

(C) No person may have an ownership interest in more than one commercial cannabis business in the city for a retailer-storefront business.

(Ord. 1063, passed 2-15-2022)

(A) Commercial cannabis businesses shall only be located in those zoning districts as set forth in Chapter 25.

(B) No commercial cannabis business may be located within a 600 foot linear radius measured from property line to property line of a school, day care center or youth center that is in existence at the time of submission of a completed initial application for a CCBP. This prohibition shall not apply to any subsequent renewal of a CCBP.

(Ord. 1063, passed 2-15-2022)

(A) Following the effective date of this chapter, the Director shall make available the necessary forms, adopt any necessary application rules for the submission, intake, review, and approval of CCBP applications not otherwise set forth in this chapter, and establish dates upon which applications will be accepted.

(B) For those classifications for which only a limited number of CCBPs are authorized, the Director shall establish an initial period of not less than 30 days by which all such applications must be submitted. If the number of applications submitted in this initial period exceeds the maximum number of CCBPs authorized, the procedure set forth in § 6B.20 for competitive applications shall be utilized to award permits.

(C) Any person applying for a CCBP under this chapter shall submit a completed application therefor on the forms promulgated by the Director along with any additional required documents and fees.

(D) The Director shall accept for processing applications meeting the requirements set forth in this section. Any applications not adhering to the requirements set forth herein, or which demonstrate an inability to comply with the requirements of this chapter may be rejected. The application shall include the following information, in addition to any additional information deemed necessary by the city to process the application:

(1) Payment of fees;

(2) Application is filled out completely;

(3) The address, suite number (if applicable) and Assessor’s parcel number of the property on which the proposed business shall be located;

(4) The name, address, and contact information for the business owner(s). If the owner is a corporation, limited liability company, partnership or other type of entity, legal documents outlining the business structure shall be provided, along with the name, address and contact information for each officer. The following documents, if applicable to the business structure, shall be provided:

(a) Articles of incorporation;

(b) Articles of organization;

(c) Certificate of limited partnership;

(d) Statement of partnership authority; and

(e) Fictitious name statements;

(5) For each owner/officer:

(a) Copy of Social Security card;

(b) Copy of Department of Motor Vehicles (DMV) issued driver's license, DMV issued ID card or passport;

(c) Proof of address (DMV issued driver’s license, DMV issued ID card and/or recent utility bill in owner/officer’s name); and

(d) Percentage of ownership interest held in the applicant entity;

(6) A completed live scan application for each owner/officer on a form specified by the Director for all owners holding more than 20% financial interest in the applicant entity;

(7) The name and address of the applicant’s current agent for service of process;

(8) A completed city business license application. Applicant has signed all indemnity, liability, disclosure or other legal agreements required under this chapter;

(9) Applicant has agreed that upon approval from the State of California for commercial cannabis activity that they shall provide the Director with a copy of all documents submitted to the State of California upon request; and

(10) Applicant has attested under penalty of perjury that all information submitted is truthful, accurate, and whole; and that nothing has been altered to misrepresent fact by lie or omission.

(E) Should the Director determine that the application is missing and/or needs further information, they may so notify the applicant in writing. The failure of the applicant to provide the requested information with ten business days shall cause the application to be rejected.

(F) All information submitted by applicants shall be true, correct, whole, and be free of any material misrepresentation of fact, lie or omission.

(Ord. 1063, passed 2-15-2022)

(A) Approval of a permit under this section grants applicants ability to seek state licensing. Issuance of a license by DCC to the applicant for the specified commercial cannabis activity is required prior to any commercial cannabis business engaging in commercial cannabis activity.

(B) The Director, after receiving the application and the required information, and except for competitive applications, shall grant the permit, if they find all the following:

(1) The application complies with all the requirements of this chapter;

(2) The applicant has not knowingly made a material misrepresentation in the application;

(3) The applicant has not had a CCBP denied or revoked for cause by the city within the last five years prior to the date of the application; and

(4) The commercial cannabis business, as proposed by the applicant would comply with all applicable provisions of state law and this code, including, but not limited to this chapter and all health, zoning, fire and safety requirements.

(C) Upon determination by the Director that an application is in compliance with this chapter and Chapter 25, such application shall be approved and issued a CCBP within ten business days, except for competitive applications as provided for in this chapter and/or for those applications that require a development agreement. Upon approval, permittees must obtain licensing from the DCC prior to operating.

(D) Competitive applications for which the Director has made a determination that such application is in compliance with this chapter shall be authorized to proceed to the competitive application selection process and shall be so notified within ten business days.

(E) If any of the items listed in this section are not met or provided, the Director may notify the applicant of the deficiency in writing, after which the applicant will have ten business days from the date of notice to correct the deficiency. If the deficiency is not corrected to the satisfaction of the Director within ten business days, the Director may deny the permit.

(Ord. 1063, passed 2-15-2022)

(A) The Director shall establish objective review criteria consistent with this section utilizing a point system or equivalent quantitative evaluation scale. Following notification under § 6B.19, applicants shall submit a supplemental statement indicating which criteria they meet, along with evidence and/or documentation in support thereof, in a form and manner established by the Director.

(B) (1) The objective review criteria established shall include at a minimum the following elements:

(a) Community engagement;

(b) Local business partnerships; and

(c) Living wage provisions.

(2) The Director may establish additional elements in their discretion to be included in the objective review criteria in order to select qualified applicants.

(C) Within 60 days of the deadline to submit applications the Director shall evaluate each application, based upon the objective review criteria. After the initial review, ranking, and scoring under the objective review criteria, the Director will make a final determination in accordance with this section and shall so notify all applicants. There shall be no right to appeal the ranking and/or scoring of applications.

(D) Upon notification that an applicant has met the objective review criteria and is otherwise eligible to receive a CCBP, the applicant must enter into a negotiated development agreement with the city within 120 days. Failure to enter into a development agreement shall render the applicant ineligible to receive a CCBP for that property. Should an applicant become ineligible to receive a CCBP, the next highest scoring applicant, if any, shall be notified that they have 120 days to enter into a negotiated development agreement. The time periods required under this section shall not include the time required for public hearings as set forth in § 25.247 and may be extended upon mutual written agreement of the applicant and the city. There shall be no right under this chapter to appeal a decision of the City Council not to enter into a development agreement and/or any subsequent ineligibility of an applicant for a CCBP.

(E) The Director may delegate his or her duties hereunder to the TAC, or to other body established by the city to review and score applications. Members of the TAC and/or any other body shall be subject to all conflict-of-interest provisions of state and local law, including but not limited to the Political Reform Act, California Government Code § 81000 et seq.

(F) For purposes of this section, the following principals shall apply in establishing the minimum elements of objective review criteria and points to be awarded therefore:

(1) Community engagement. Shall include past, present or planned activities that demonstrate understanding of the City of Red Bluff community, its values, how the commercial cannabis business plans to integrate into the community, and involvement with local non-profits/charitable/volunteer organizations.

(2) Local business partnerships. Shall include past, present or planned partnerships with, including the procurement of goods and services from, businesses located within the city.

(3) Living wage provisions. Shall mean a binding commitment by the commercial cannabis business to provide wages to each employee that exceeds the Tehama County area median income by a minimum of 120% exclusive of any bonuses or commissions and may include a commitment to hire and retain a specified number of residents of the city, enter into a labor peace agreement below the minimum number of employees mandated by state law, and/or other employee benefits such as paid leave, health insurance and similar factors.

(G) Any permit awarded under this section may include conditions of approval requiring that the commercial cannabis business permittee comply with the objective review criteria set forth in its supplemental statement or otherwise committed to during the application process.

(Ord. 1063, passed 2-15-2022)

(A) Suspension or expiration of a state license issued to a commercial cannabis business shall immediately suspend the ability of that commercial cannabis business to operate within the city, and shall serve to suspend the CCBP, unless the state reinstates or reissues the state license within 90 days. Should the state license remain suspended or expired for 90 days or longer, any CCBP issued pursuant to this chapter shall expire and be of no further force and effect. Should the state revoke or terminate the license of a commercial cannabis business for cause, such revocation or termination shall also serve to revoke or terminate the CCBP and the ability of a commercial cannabis business permitted pursuant to this chapter, including any owner or manager thereof, to operate any commercial cannabis business within the city for a period of five years from the date of such revocation or termination.

(B) A permittee shall have no right to appeal the expiration, suspension or revocation of a CCBP or the ability to operate a commercial cannabis business under this chapter that is based on the status of their state license; provided, however, an owner or manager thereof may appeal their prohibition from operating another commercial cannabis business in the city. Such appeal shall be based on the hearing procedures set forth in this chapter. The burden shall at all times be on the appellant to show good cause why the prohibition should be reversed or modified.

(Ord. 1063, passed 2-15-2022)

(A) All commercial cannabis business permits may be renewed annually one year after the date of issuance. Permit renewals shall be initiated not more than 90 days prior to the specified renewal date.

(B) Permit renewals shall be granted so long as the commercial cannabis business remains in compliance with this chapter and submits the renewal fee adopted pursuant to § 6B.38.

(C) Renewals not submitted in a timely fashion shall be subject to a late renewal fee adopted pursuant to § 6B.38.

(D) Any permit expired and not renewed within 60 days shall be void on the sixty-first day.

(Ord. 1063, passed 2-15-2022)

(A) Grounds. A CCBP may be revoked or suspended by the Director on any of the following grounds:

(1) Where the Director has found and determined that the preservation of the public health, safety, peace and welfare necessitate revocation of said permit;

(2) Where the permittee, the commercial cannabis business and/or any owner, manager or any employee thereof has violated or is in violation of any applicable provisions of this chapter, other applicable provisions of this code and/or any other applicable provision of state law;

(3) Where a permit has been granted on false or fraudulent evidence, testimony, or application; or

(4) Where the permittee, commercial cannabis business and/or any owner, manager or employee thereof has violated or is in violation of the terms and provisions of said permit.

(B) Factors for suspension or revocation. The Director may consider, but is not limited to, the following factors in deciding whether a permit should be suspended or revoked in accordance with this chapter, as applicable:

(1) The nature and severity of the acts, offense, or crimes under consideration;

(2) Any corrective action taken by the permittee;

(3) Prior violations at the permitted premises by the permittee and the effectiveness of prior corrective action;

(4) Previous sanctions imposed against the permittee;

(5) The number and/or variety of current violations;

(6) The likelihood of recurrence;

(7) All circumstances surrounding the violation;

(8) Whether the violation was willful;

(9) Any actual or potential harm to the public;

(10) The length of time the permit has been held by the permittee;

(11) Evidence of expungement proceedings under California Penal Code § 1203.4; and

(12) Any other factor that makes the situation unique or the violation of greater concern, with respect to the permittee or the permitted premises.

(C) Hearing prior to suspension or revocation. No permit shall be suspended or revoked, unless based on the suspension and/or revocation of a state license, until said permittee has had an opportunity for a hearing before the Director. The Director may delegate this duty to the Technical Advisory Committee.

(D) Written notice of the revocation or suspension, the reasons therefore and the requirement to request a hearing shall be given by certified mail to a permittee’s last known mailing address or by such other method reasonably calculated to provide notice.

(E) The revocation or suspension shall be final and effective after ten calendar days following the date of mailing set forth in division (D), unless the permittee files an application for a hearing with the City Clerk prior to such effective date. There shall be no cost to the permittee for such a hearing under this section.

(F) Except as otherwise provided in division (G), the hearing shall be commenced within 30 calendar days of the filing of an application for hearing, unless the city and permittee agree otherwise. Hearings conducted pursuant to this section shall be open to the public, shall not be conducted according to the technical or traditional rules relating to evidence, and shall provide, personally or by counsel or both, an opportunity for permittee to defend and present evidence on their behalf. At least ten calendar days prior to the hearing, permittee shall be provided with any documentation upon which the revocation or suspension is based. Following the close of the hearing, the Director or TAC shall within 30 days render a written decision, which if by the TAC shall be based upon a majority vote thereof, whether or not to impose revocation or suspension.

(G) Notwithstanding the foregoing, the Director may suspend, pending a hearing, any CCBP where it has been determined by thereby that an immediate suspension of the permit is necessary for the protection of the public health, safety, peace and welfare. In the event of such a suspension, the Director shall, within 12 hours after said suspension, cause to be served upon said business or permittee a written statement containing the grounds for said suspension, any written documentation upon which the revocation is based and a notice of hearing to show cause before the Director or TAC why said permit should not be permanently revoked, which said hearing shall be commenced no later than five calendar days following the service of said notice unless the parties thereto agree otherwise, and thereafter followed by a written decision pursuant to division (F).

(H) Following the hearing, or a waiver thereof by permittee, the Director or TAC may also modify and/or add conditions and/or requirements of the CCBP in lieu of suspension or revocation.

(I) Appeals from decision of the Director or TAC provided for herein shall be made in accordance with the procedure of § 6B.24.

(Ord. 1063, passed 2-15-2022)

(A) Notice of appeal.

(1) Within ten calendar days after the issuance notice of the decision of the Director or TAC to revoke, suspend, modify or deny the issuance or renewal of a CCBP, the applicant or permittee may appeal such action by filing a written notice of appeal with the City Clerk setting forth the reason why the decision was not proper. The grounds for the appeal shall be stated with specificity. A decision to rank and/or score an application pursuant to § 6B.20 shall not be subject to appeal.

(2) The notice of appeal shall be in writing and signed by the person making the appeal (“appellant”), or their legal representative, and shall contain the following:

(a) Name, address, and telephone number of the appellant;

(b) Specify the decisions, actions, or a particular part thereof, made that are the subject of the appeal;

(c) Include a true and correct copy of the notice and/or decision issued by the Director or TAC for which the appellant is appealing;

(d) State with specificity the reasons and grounds for making the appeal, including, but not limited to, a statement of facts upon which the appeal is based in sufficient detail to enable the City Council, or any appointed hearing officer, to understand the nature of the controversy, the basis of the appeal, and the relief requested;

(e) All available documents or other evidence pertinent to the appeal that the appellant requests the hearing officer or body to consider at the hearing; and

(f) A non-refundable appeal fee, as established by resolution of the City Council.

(3) Failure of the appellant to timely submit a written appeal constitutes a waiver of the right to appeal any appealable notice and/or decision of Director or TAC. In this event, such notice of revocation, suspension and/or other action is final and binding and shall become effective upon the expiration of the period for filing a written notice of appeal.

(4) In the event a written notice of appeal is timely filed, the non-renewal, suspension, revocation, or other action shall not become effective until a final decision has been rendered and issued by the City Council or appointed hearing officer or body.

(B) Appeal hearing and proceedings.

(1) All appellants shall, subject to filing a timely written notice of appeal and payment of fees, be entitled to a hearing before the City Council, or appointed hearing officer or body.

(2) Upon receipt by the City Clerk of a timely-filed appeal, the City Clerk shall place on the next regularly scheduled City Council meeting or earlier special council meeting the question of whether the City Council itself shall hear the appeal. The City Council’s decision shall be limited to whether or not to hear the appeal or delegate that authority and shall not include consideration or discussion of the merits or facts of the appeal. In the event that the City Council does not affirmatively choose to hear such appeal or does not act to appoint another body to serve to hear such appeal, the City Clerk shall obtain the services of a hearing officer from the state Office of Administrative Hearings or other agency or organization that provides neutral hearing officers.

(3) The administrative appeal shall be scheduled no later than 45 days, and no sooner than 30 days, after receipt of a timely-filed notice of appeal, if such appeal is to be heard by the City Council or other city-appointed body. If the state Office of Administrative Hearings or other agency or organization is utilized for such hearing, then the hearing shall be scheduled as expeditiously as possible pursuant to the availability of a hearing officer. The appellant(s) listed on the written notice of appeal shall be notified in writing of the date, time, and location of the hearing at least ten days before the date of the hearing (“notice of appeal hearing”).

(C) At the date, time and location set forth in the notice of appeal hearing, the City Council, or an appointed hearing officer or body, shall hear and consider the testimony of the appellant(s), city staff, and/or their witnesses, as well as any documentary evidence properly submitted for consideration.

(D) The following rules shall apply to the appeal hearing:

(1) The hearing shall be a new (i.e., "de novo”) hearing based on a preponderance of the evidence standard. The formal or technical rules of evidence shall not apply. However, irrelevant, collateral, undue, and/or repetitious testimony or other evidence may be excluded. The appellant bears the burden of proof on appeal.

(2) The City Council, or appointed hearing officer or body, may accept and consider late evidence not submitted initially with the notice of appeal upon a showing by the appellant of good cause. The City Council, or appointed hearing officer or body, shall determine whether a particular fact or facts amount to a good cause on a case-by-case basis.

(3) The appellant may bring a language interpreter to the hearing at their sole expense.

(4) All parties may, at their own discretion, record the hearing by stenographer or court reporter, audio recording, or video recording. If the appellant requests from the city that said recording take place, the costs of same shall be deposited with the city at the time the notice of appeal is submitted to the city.

(E) The appellant or their legal representative’s failure to appear at the appeal hearing shall constitute both the appellant’s waiver of the right to appeal and a failure to exhaust all administrative remedies. In such instance, Director or TAC’s notice of decision is final and binding.

(F) Decision of the City Council, or appointed hearing officer or body; final decision.

(1) Following the conclusion of the appeal hearing, the City Council, or appointed hearing officer or body shall determine if any ground exists for the non-issuance, non-renewal, suspension or revocation of the commercial cannabis permit or other appealed action and shall issue a written decision within ten business days thereof.

(2) The decision of the City Council, or appointed hearing officer or body, is final and conclusive and is subject to the time limits set forth in California Code of Civil Procedure § 1094.6.

(G) A copy of the final decision shall include notification of the time limits of California Code of Civil Procedure § 1094.6 and be served by certified, first-class U.S. Mail on the appellant. If the appellant is not the owner of the real property in which the commercial cannabis business is located, or proposed to be located, a copy of the final decision may also be served on the property owner by first class mail to the address shown on the last equalized assessment roll. Failure of a person to receive a properly addressed final decision shall not invalidate any action or proceeding by the city pursuant to this chapter.

(Ord. 1063, passed 2-15-2022)