The proposed modifications to Chapter 18.22 is exempt from the California Environmental Quality Act pursuant to Business and Professions Code Section 26055(h), “Without limiting any other statutory exemption or categorical exemption, Division 13 (commencing with Section 21000) of the Public Resources Code does not apply to the adoption of an ordinance, rule, or regulation by a local jurisdiction that requires discretionary review and approval of permits, licenses, or other authorizations to engage in commercial cannabis activity. To qualify for this exemption, the discretionary review in any such law, ordinance, rule, or regulation shall include any applicable environmental review pursuant to Division 13 (commencing with Section 21000) of the Public Resources Code.This subdivision shall become inoperative to July 1, 2021.”

 A RESOLUTION OF THE PLANNING COMMISSION OF THE CITY OF LA HABRA RECOMMENDING THAT THE CITY COUNCIL APPROVE ZONE CHANGE 21-01 FOR AN ORDINANCE AMENDING CHAPTER 18.22 (“COMMERCIAL CANNABIS ACTIVITY”) TO MODIFY EXISTING DEVELOPMENT STANDARDS AS PER EXHIBIT “A”.

History

The Planning Commission at their regular meeting of February 10, 2020, recommended that the City Council approve Zone Change 19-03 to La Habra Municipal Code Title 18 (Zoning), Chapter 18.22 (Commercial Cannabis Activity) to allow for two (2) non-storefront cannabis retail facilities and modifications to existing development standards (see Attachment 1).  The City Council at their regular meeting of March 2, 2020 denied the draft ordinance (see Attachment 2).

On August 3, 2020, the City Council considered a ballot measure to authorize the City Council to adopt an ordinance authorizing up to six percent gross receipts tax on commercial cannabis activity and authorize up to four licenses for cannabis non-storefront retail facilities (delivery only).  After receiving testimony from the public and staff responding to Council questions, it was the consensus of the City Council to allow the public to decide the issue of cannabis use within the community.  The City Council by a 4-1 vote placed on the November 3, 2020 General Municipal Election ballot a measure to establish a cannabis business tax and allow for four (4) non-storefront cannabis retail facilities (Attachment 3).  On November 3, 2020, Measure W (City of La Habra Cannabis Business Tax/Regulation Ordinance of 2020), received 67.46% (17,726) votes in favor of the measure while 32.54% (8,550) voted in opposition to the measure. Therefore, Measure W was approved by the La Habra voters.

Due to the approval of Measure W, the City Council on December 7, 2020 reconsidered their action on Zone Change 19-03.  The City Council on a 3-0 vote approved Zone Change 19-03 to allow for four (4) cannabis non-storefront retail facilities per Measure W along with modifications to Chapter 18.22 to recognize the approval of the Cannabis Business Tax (see Attachment 4).  The action to create the Cannabis Business Tax with the specific percentage of tax to be assessed on proposed cannabis business activity is not a land use issue and will be scheduled for a future City Council meeting.  

Code Modifications

The proposed modification to the existing Commercial Cannabis Activity Ordinance involves section 18.22.050.A, “Disqualification of Applications”.  A proposed subsection 10 will be added that requires the applicant to comply with all rules and regulations promulgated by the City relating to the application process.  Failure to submit a complete application in compliance with the application form and related administrative policies prepared in compliance with Section 18.22.040(A) will result in the disqualification of the application (see Attachment 5). 

Staff will be presenting to the City Council for formal approval the “Cannabis Business Permit Application”, “Cannabis Business Permit Checklist”, “Commercial Cannabis Business Opportunity Activity Summary Sheet” and “Step by Step Guide-Application for Cannabis Business Permit” handouts (see Attachments 6, 7, 8 and 9).  Versions of these same documents were created and successfully utilized for the submittal, evaluation and ultimate approval of the existing cannabis distribution facilities located in La Habra.  Given the degree of interest in the soon to be available four (4) non-storefront cannabis retail facility licenses, it is very likely more applications will be received than there are available licenses.  Therefore, staff will seek City Council approval of the process.  The proposed amendment allows for these documents to be incorporated as part of the Commercial Cannabis Activity Business Standards criteria.  It is recommended that the Planning Commission recommend that the City Council adopt Zone Change 21-01 for an Ordinance amending La Habra Municipal Code Title 18 (Zoning), Chapter 18.22 (Commercial Cannabis Activity) to modify existing development standards.

There are no fiscal impacts to the City's General Fund.

The proposal has been reviewed pursuant to the requirements of the City’s National Pollutant Discharge Elimination System (NPDES) Municipal Permit, the Local Implementation Plan (LIP), and the Model Water Quality Management Plan (WQMP), Section 7.2.  Since the Zone Change does not disturb any soil, it is exempt by the Water Quality Ordinance from the preparation of a WQMP.
 

Action on the modifications to the Commercial Cannabis Ordinance implements the following General Plan Policies:

LU 4.1 Development Compatibility
LU 6.3 High-Impact Uses
LU 16.1 Diversity of Uses
ED 2.1 Business Attraction