HomeMy WebLinkAboutItem 4a. A request to modify an existing Conditional Use Permit (USE-0550-2019) to add delivery services to a cannabis retail storefront operation located at 280 Higuera St (MOD-0424-2025)1
PLANNING COMMISSION AGENDA REPORT
SUBJECT: A REQUEST TO MODIFY AN EXISTING CONDITIONAL USE PERMIT
(USE-0550-2019) TO ADD DELIVERY SERVICES TO A CANNABIS RETAIL
STOREFRONT OPERATION LOCATED AT 280 HIGUERA ST (MOD-0424-2025).
BY: Ivana Gomez, Cannabis Business
Coordinator FROM: Tyler Corey
Phone Number: (805)-781-7147 Phone Number: (805)-781-7169
Email: igomez@slocity.org Email: tcorey@slocity.org
APPLICANT: Megan’s Organic Market REPRESENTATIVE: Megan Souza
RECOMMENDATION
Approve the request to modify an existing Conditional Use Permit (USE-0550-2019) to
add delivery services to an existing cannabis retail storefront operation at 280 Higuera
Street, based on updated findings and subject to revised conditions of approval.
SITE DATA
1.0 COMMISSION'S PURVIEW
Pursuant to the City of San Luis Obispo Municipal Code (“SLOMC”) Chapter 17.110, the
Planning Commission may review the proposed modification to Conditional Use Permit,
USE-0550-2019, for consistency with the General Plan and Zoning Regulations, and
adopt a resolution to amend the use permit in accordance with the request.
Applicant Megan’s Organic Market
Zone Retail Commercial (C-R)
Overlay Zone Mixed Use (MU) Special
Focus Area (S-F),
Cannabis Business Zone
(CBZ)
General Plan General Retail (G-R)
Site Area
Environmental
Determination
0.18 acre (8,000 s.f.)
Categorically Exempt,
CEQA Guidelines §
15301 (Existing Facilities)
Meeting Date: 8/27/2025
Item Number: 4a
Time Estimate: 30 minutes
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Item 4a
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2.0 SUMMARY
Megan’s Organic Market is one of two existing cannabis retail storefronts in the City. On
August 14, 2024, the Planning Commission adopted Resolution No. PC-1089-2024
recommending the City Council adopt an ordinance which provides a pathway for
cannabis retail storefronts to add delivery services to their existing operations, consistent
with state law.
On October 1, 2024, the City Council adopted Ordinance No. 1740, which allows existing
cannabis retail storefronts to amend their Conditional Use Permit (CUP) to add delivery
services to their licensed operation. In accordance with Table 2-1 within SLOMC §
17.10.020, Megan’s Organic Market has applied for a modification to their CUP to add
delivery services to their location at 280 Higuera Street, including the addition of one to
two small electric delivery vehicles and updated security and operation al protocols. No
physical changes to the licensed premises (including the floor and site plans) are
proposed.
3.0 PREVIOUS REVIEW
On November 13, 2019, the Planning Commission adopted Resolution No. PC-1013-
2019 granting a CUP to Megan’s Organic Market for the establishment of a cannabis retail
storefront at 280 Higuera Street. Megan’s Organic Market opened to the public on August
3, 2020, and has remained operational since then.
On June 5, 2025, Megan’s Organic Market applied to amend to their CUP (USE-0550-
2019) to add delivery services to their existing operation, consistent with Table 2-1 within
SLOMC § 17.10.020.
4.0 PROJECT ANALYSIS
Project Description
Megan’s Organic Market proposes to add delivery services to their existing operation,
including the addition of 1-2 fully enclosed, unmarked electric vehicles operated by trained
employees aged 21 and over, as required by state law (California Code of Regulations,
Title 4 §§ 15415(a) and 15417(a)). To support delivery services, approximately two
additional full-time employees will be hired. Delivery vehicles will be installed with GPS
devices owned by the licensed business and all cannabis goods carried during delivery
will be stored in a secure, fully enclosed trunk or compartment within the vehicle as
required by 4 CCR § 15417(b) and (d).
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Item 4a
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Orders are prompted by a delivery request from a customer. Cannabis goods are loaded
into the vehicle inside the existing secure delivery bay and accompanied by a delivery
inventory ledger and a log of all stops planned for a route, as required by 4 CCR §
15418(d) and (e). During deliveries, employees are restricted to performing delivery-
related duties and may only make stops necessary for rest, fueling, or vehicle
maintenance (4 CCR § 15415(e)). Upon returning to the premises, all undelivered
cannabis goods will be physically returned to the licensee’s inventory by the delivery
employee that same day (4 CCR § 15418(i)). All necessary internal inventory and track
and trace system records will also be updated that same day by an authorized retail
employee in accordance with 4 CCR § 15049.3.
When delivering cannabis goods to a customer, employees will confirm the identity and
age of the delivery customer as required by 4 CCR § 15404 and ensure that all cannabis
goods sold comply with requirements of 4 CCR § 15413.
Consistency with General Plan and Cannabis Regulations
Staff has evaluated the proposed modification for consistency with applicable General
Plan goals and policies, and for consistency with the regulations for commercial cannabis
activity set forth Chapter 9.10 (Cannabis Regulations) and Section 17.86.080 (Cannabis
Zoning Regulations) of the Municipal Code. The proposed modification has also been
evaluated for consistency with applicable state regulations, including 4 CCR Sections
15400 – 15424 (Retailers).
Permitting Requirements
Megan’s Organic Market holds a valid commercial cannabis Operator Permit and state
license as required by SLOMC § 9.10.040. Under state law (4 CCR Division 19) and as
allowed under Table 2-1 (SLOMC § 17.10.020), retail storefronts with a valid state license
and city permit may sell cannabis goods through storefront and by delivery.
Security Plan
In accordance with SLOMC § 9.10.50, the applicant submitted an updated Security Plan
that addresses both state-wide regulations of the Department of Cannabis Control and
concerns of the City Police Department (SLOMC § 17.86.080(E)(4)(b)(i)). The Security
Plan prepared by the applicant for this application was reviewed and approved by the
City’s Police Department during the departmental review process. It includes protocols
for vehicle security during transportation, protocols for deliveries, documentation an d
recordkeeping, and a plan for departures and returns to the licensed premises.
Hours of Operation
Deliveries of cannabis goods shall occur only during the business’s approved hours of
operation, 7:00 AM to 9:00 PM, in accordance with SLOMC §§ 17.86.080(E)(10)(b)(v).
Per SLOMC § 17.86.080(E)(11)(b)(ii), retail non-storefront (delivery-only) cannabis
businesses may operate between 6:00 AM and 10:00 PM; however, this provision applies
only to businesses without a storefront. Megan’s Organic Market is a retail storefront
cannabis business and is permitted to conduct delivery in accordance with State law.
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However, delivery activity is limited to the City’s approved retail storefront operating hours
of 7:00 AM to 9:00 PM, as established by local ordinance.
While State regulations allow both storefront and non-storefront retail licensees to operate
between 6:00 AM and 10:00 PM, the City’s adopted hours for storefront cannabis
businesses apply in this case.
5.0 ENVIRONMENTAL REVIEW
The project is categorically exempt from the preparation of environmental documentation
under the California Environmental Quality Act (CEQA). The project is consistent with
General Plan policies for the land use designation and is consistent with the appl icable
zoning designation and regulations. The project consists of the operation of existing,
private structures that involves negligible expansion of use beyond existing and historical
uses, as described in CEQA Guidelines § 15301 (Existing Facilities).
6.0 OTHER DEPARTMENT COMMENTS
The project has been reviewed by staff members in the Public Works and Community
Development Departments for consistency with the City’s General Plan and Municipal
Code. As noted above, the Security Plan was reviewed and approved by the City Police
Department. Any conditions of approval or informational notes from these departments
and divisions have been incorporated into the Draft Resolution (Attachment A) for project
approval.
7.0 ALTERNATIVES
1. Continue the item. An action to continue the item should include a detailed list of
additional information or analysis required to make a decision.
2. Deny the item. Deny the project based on findings of inconsistency with State law,
the General Plan, Zoning Regulations, and/or other pertinent City standards.
8.0 ATTACHMENTS
A – Draft PC Resolution amending USE-0550-2019 (Megan’s Organic Market) to allow
delivery services (MOD-0424-2025).
Page 24 of 89
Planning Commission Resolution No. PC-XXXX-2025
MOD-0424-2025 (280 Higuera St)
Page 1
1
RESOLUTION NO. PC-XXXX-25
A RESOLUTION OF THE CITY OF SAN LUIS OBISPO PLANNING
COMMISSION MODIFYING AN EXISTING CONDITIONAL USE PERMIT
(USE-0550-2019) TO ADD DELIVERY SERVICES TO A CANNABIS
RETAIL STOREFRONT OPERATION. THE PROJECT IS EXEMPT FROM
ENVIRONMENTAL REVIEW (CEQA) AS REPRESENTED IN THE
PLANNING COMMISSION AGENDA REPORT AND ATTACHMENTS
DATED AUGUST 27, 2025 (280 HIGUERA ST; MOD-0424-2025).
WHEREAS, on November 13, 2019, the Planning Commission adopted
Resolution No. PC-1013-2019 granting a Conditional Use Permit to Megan’s Organic
Market for the establishment of a cannabis retail storefront at 280 Higuera Stree t; and
WHEREAS, on October 1, 2024, the City Council of the City of San Luis Obispo
conducted a public hearing in the Council Chamber of City Hall, 990 Palm Street, San
Luis Obispo, California to adopt Ordinance No. 1740 (2024 Series), amending Table 2-1
(Uses Allowed by Zone) in Section 17.10.020 of Title 17 (“Zoning Regulations”) of the
Municipal Code to allow existing cannabis retail storefronts to conduct retail sales by
delivery with a modification to their existing Conditional Use Permit to include delivery;
and
WHEREAS, the Planning Commission of the City of San Luis Obispo conducted a
public hearing in the Council Chamber of City Hall, 990 Palm Street, San Luis Obispo,
California, on August 27, 2025, for the purpose of considering a modification to Use
Permit USE-0550-2019 to add delivery services to an existing retail storefront at 280
Higuera St; and
WHEREAS, notices of said public hearings were made at the time and in the
manner required by law; and
WHEREAS, the Planning Commission has duly considered all evidence, including
the testimony of the applicant, interested parties and the evaluation and
recommendations by staff presented at said hearing.
NOW, THEREFORE, BE IT RESOLVED, by the Planning Commission of the City
of San Luis Obispo as follows:
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Planning Commission Resolution No. PC-XXXX-2025
MOD-0424-2025 (280 Higuera St)
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SECTION 1. Findings. Based upon all evidence, the Planning Commission makes
the following findings:
1. The proposed use is consistent with Section 17.86.080 (“Cannabis Zoning
Regulations”) and Chapter 9.10 (“Cannabis Regulations”) of the Municipal Code because,
as proposed, the use is located within a CBZ Overlay Zone, will not negatively impact the
residential uses in the neighborhood, is consistent with adjacent businesses that have
similar hours of operation, and is consistent with buffer requirements imposed by the
City’s Zoning Regulations.
2. The site is physically suitable in terms of:
a. Its design, location, shape, size, and operating characteristics of the
proposed use;
b. Traffic generation and the provision of public and emerge ncy vehicle
(e.g. fire and medical) access;
c. Public protection services (e.g. fire protection, police protection, etc.);
and
d. The provision of utilities (e.g. potable water, schools, solid waste
collection and disposal, storm drainage, wastewater collect ion,
treatment, and disposal, etc.).
3. That the project will not be detrimental to the health, safety, and welfare of
persons living or working at the site or in the vicinity because the cannabis retail storefront
does not present a potential threat to the surrounding property and buildings. This project
is subject to Use permit requirements, City regulations, and California Building Code
requirements designed to address health, safety, and welfare concerns. Additionally, the
applicant prepared a Security Plan that addresses both state- wide regulations of the
Bureau of Cannabis Control and concerns of the City Police Department.
4. The cannabis retail storefront, as proposed, will comply with all the
requirements of State and City for the sale of cannabis goods, including dual licensure
and participation in an authorized track and trace program.
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Planning Commission Resolution No. PC-XXXX-2025
MOD-0424-2025 (280 Higuera St)
Page 3
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5. The proposed modification to USE-0550-2019 is consistent with the
regulations for commercial cannabis activity set forth in Chapter 9.10 (Cannabis
Regulations) and Section 17.86.080 (Cannabis Zoning Regulations) of the Municipal
Code, because the Operator holds a valid commercial cannabis Operator Permit and
state license as required by SLOMC § 9.10.040, and, under state law (4 CCR Division
19), and as allowed under Table 2-1 (SLOMC § 17.10.020), retail storefronts with a valid
state license and city permit may sell cannabis goods through storefront and by delivery.
Additionally, the Operator has submitted an updated Security Plan in accordance with
SLOMC § 9.10.50, which has been reviewed and approved by the City Police
Department.
SECTION 2. Environmental Determination. The project is categorically exempt
from the preparation of environmental documentation under the California Environmental
Quality Act (CEQA). The project is consistent with General Plan policies for the land use
designation and is consistent with the applicable zoning designation and regulations. The
project consists of the operation of existing, private structures that involves negligible
expansion of use beyond existing and historical uses, as described in CEQA Guidelines
§ 15301 (Existing Facilities).
SECTION 3. Action. The Planning Commission does hereby approve the
modification to Conditional Use Permit USE-0550-2019 to add delivery services to an
existing cannabis retail storefront located at 280 Higuera Street, subject to the following
conditions:
1. The proposed use shall operate consistent with the project description and
other supporting documentation submitted with this application unless otherwise
conditioned herein, including, but not limited to: the Operations Plan , Chapter 9.10 of the
City Municipal Code, and Section 17.86.080 of the City Municipal Code, all of which are
incorporated into and made material terms of these conditions. This permit shall be
reviewed by the Community Development Director if any reasonable written complaint is
received from any citizen or from the Police Department or upon receipt of evidence or
observation that the use is not in compliance with conditions of approval and the Municipal
Code. The Community Development Director may refer the complaint to the Planning
Commission at his/her/their discretion and conditions of approval may be added, deleted,
or modified or the use permit may be revoked to ensure ongoing compatibility between
uses on the project site and other nearby uses.
2. Any parking lot lighting installed on the site by the applicant shall be night
sky compliant LED bollard lighting, as specified on sheet A1.0 of the project plans dated
June 27, 2019, by Ten Over Studio. The Community Development Director may modify
this requirement upon a determination that such lighting would not be conducive to the
safety of the public or would not meet the requirements of the California Building Code.
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Planning Commission Resolution No. PC-XXXX-2025
MOD-0424-2025 (280 Higuera St)
Page 4
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3. The applicant shall obtain and maintain the commercial cannabis operator
permit and any appropriate state licenses. Applicant shall comply with applicable state
law, including but not limited to Chapter 3 of Title 4 of the California Code of Regulations.
4. The applicant shall pay all applicable current and future state and local
taxes and all applicable commercial cannabis fees and related penalties established by
the City Council, including but not limited to application, administrative review, inspection,
etc.
5. Minors and persons under the age of twenty-one are prohibited from
entering the cannabis retail storefront, even if accompanied by a parent or guardian,
unless the individual is at least eighteen years of age and possesses a valid physician’s
recommendation for medical cannabis.
6. Outdoor storage of cannabis or cannabis products is prohibited.
7. During business hours, defined as 7:00 AM to 9:00 PM in accordance with
San Luis Obispo Municipal Code § 17.86.080(E)(10)(b)(v), all delivery vehicles
associated with the cannabis business shall be parked in the designated secure delivery
bay for long-term storage. Outside of business hours, a maximum of one delivery vehicle
may be parked overnight in the business’s designated parking area, as shown on the
approved site plan.
8. The applicant shall operate a maximum of two delivery vehicles to support
delivery operations. Any additional vehicles proposed to support delivery operations are
hereby subject to the approval of the Community Department Director.
9. Each delivery vehicle shall be fully enclosed and unmarked, equipped with
a Global Positioning System (GPS) device owned by the licensee, and a minimum of two
cameras with at least 720p resolution, recording continuously during deliveries.
Surveillance footage must be retained securely for a minimum of 90 days and made
available to city and state officials upon request.
10. All delivery employees must be at least 21 years old, employed directly by
the licensee, and carry valid identification and delivery documentation during deliveries.
11. Deliveries shall not be made to schools, day care centers, youth centers, or
publicly owned land, consistent with state law.
12. The licensee shall consent to unscheduled inspections of delivery vehicles,
premises, and records by city and state officials to ensure compliance.
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Planning Commission Resolution No. PC-XXXX-2025
MOD-0424-2025 (280 Higuera St)
Page 5
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13. The applicant shall defend, indemnify, and hold harmless the City and/ or
its agents, officers, and employees from any claim, action, or proceeding against the City
and/ or its agents, officers, or employees to attack, set aside, void, or annul the approval
by the City of this project, and all actions relating thereto, including but no t limited to
environmental review (" Indemnified Claims"). The City shall promptly notify the applicant
of any Indemnified Claim upon being presented with the Indemnified Claim, and City shall
fully cooperate in the defense against an Indemnified Claim.
Upon motion of ______________________, seconded by __________________ and on
the following roll call vote:
AYES:
NOES:
ABSENT:
The foregoing resolution was passed and adopted this 27th day of August 2025.
___________________
Tyler Corey, Secretary
Planning Commission
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