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HomeMy WebLinkAbout12-15-2015 Item 13 - Medical Marijuana Resolution Meeting Date: 12/15/2015 FROM: Christine Dietrick, City Attorney Michael Codron, Community Development Director SUBJECT: MEDICAL MARIJUANA RESOLUTION RECOMMENDATION Adopt a resolution reaffirming that the City’s permissive zoning code prohibits marijuana businesses, operations and uses, including cultivation of medical marijuana in the city, and making a finding that the resolution is exempt from environmental review pursuant to CEQA Guidelines, Section 15061(b)(3). DISCUSSION Background New State Laws The State Legislature recently enacted, and the Governor signed into law, a package of legislation providing for the comprehensive regulation of medical marijuana at the statewide level. Assembly Bills 243 and 266, and Senate Bill 643, create an extensive statewide regulatory system for the cultivation, manufacture, testing, storage, dispensing, distribution and transport of medical marijuana. These bills take effect January 1, 2016, but the regulations implementing them are not expected to be in place until 2018. Operators that are working in compliance with local and state requirements on or before January 1, 2018 can continue operations until their application for state licensure is either approved or denied. The new legislation provides for a “dual licensing” process whereby State licenses will not be issued to operators that are not operating in compliance with local regulation or to operators in jurisdictions that prohibit medical marijuana uses and activities. Current law permits a local entity to prohibit any and all medical marijuana business or activity within its jurisdiction or to permit and regulate such activities as deemed appropriate by the local legislative body. The newly adopted state laws expressly do not apply to individu al qualified patients or caregivers growing up to 100 square feet of marijuana for an individual patient or up to 500 square feet for up to 5 qualified patients. Rather, the new laws focus on the licensing and regulation of larger scale collective-cooperative-commercial activities. New Health and Safety Code Section 11362.777, enacted by AB 243, directs the Department of Food and Agriculture to establish a Medical Cannabis Cultivation Program, requires both a state 13 Packet Pg. 122 and local permit, and prohibits submission of an application for a state license if the proposed cultivation would violate any local ordinance or regulation or if medical marijuana uses are prohibited by the jurisdiction in which the cultivation is proposed to occur, either expressly or under principles of permissive zoning. It also provides that if a city does not have land use regulations or ordinances regulating or prohibiting the cultivation of marijuana, either expressly or otherwise under principles of permissive zoning, or chooses not to ad minister a conditional permit program, then commencing March 1, 2016, the Department of Food and Agriculture shall be the sole licensing authority for medical marijuana cultivation applicants in that city. Health and Safety Code Section 11362.777(c)(4). The State is not anticipated to adopt final regulations establishing the scope and limits of cultivation activities under State licensing standards until approximately 2018. Current City Law and Enforcement Approach The City has a “permissive zoning” code, which means that uses that are not expressly or conditionally allowed, or deemed to be similar to expressly allowed uses, are prohibited within the City. Permissive zoning effectively acts as a passive prohibition on uses not listed in the City’s zoning code as permitted uses. The City, in Municipal Code Section 17.22.101 C provides: “Interpretation of Use Listing. These regulations are intended to permit similar types of uses within each zone. The director, subject to the appeal procedures of Chapter 17.66, shall determine whether uses which are not listed shall be deemed allowed or allowed subject to use permit approval in a certain zone. This interpretation procedure shall not be used as a substitute for the amendment procedure as a means of adding new types of uses to a zone.” Table 9 of that section lists uses allowed or conditionally allowed in each zone. No use that is prohibited by or in conflict with state or federal law is included as an allowed or conditionally allowed use in Table 9 or any other provision of the City’s Zoning Code. The City has consistently taken the position that marijuana uses are not allowed under the City’s code, both because they are not expressly or conditionally allowed and because they cannot be deemed similar due to continuing conflicts with state and federal law. On that basis, the City consistently has declined to process applications for brick and mortar medical marijuana dispensaries, and to issue licenses for mobile delivery services operating within the City. The same is true for commercial cultivation operations. The City has initiated code enforcement action on commercial cultivation operations on the grounds that such uses are not expressly or conditionally allowed under the Zoning Code and, therefore, are prohibited. This permissive zoning prohibition related to medical marijuana was formally asserted by the City, as approved by the Council, as to both brick and mortar and mobile dispensaries, in a 2012 Grand Jury report response. In May 2014, staff presented regulations to Council that would have expressly prohibited dispensaries (brick and mortar or mobile) and limited and regulated personal or collective cultivation activities. Council opted not to pursue those regulations after hearing public concerns and, instead, proceeded with regulation directly addressing only the potential nuisance/odor 13 Packet Pg. 123 effects of cultivation activities. Those regulations along with other applicable standards would continue to be enforceable under the new state laws, as would the City’s permissive zoning prohibition. The City has not pursued enforcement action against non-commercial activities (i.e., small indoor and/or outdoor grows limited to qualified patients and caregivers for the personal use of qualified patients), that are not in violation of existing nuisance regulations. Finally, Council should be aware that the language in the new State regulations that is driving the need for action by March 1, 2016, is viewed by many as an unintended remnant of prior drafts that was not intended to be included in the final legislation (in part because the language only exists as to the cultivation provisions and seems otherwise inconsistent with the strong protections of local control reflected throughout the legislation). Thus, there may well be cleanup language that eliminates the March 1 deadline, but moving forward with the recommended resolution is the most cautious approach to ensure local control if that legislation does not materialize. League of California Cities Recommendation: The League of California Cities has been working diligently to assist member cities in understanding and appropriately responding to the new legislation in a timely way that ensures informed decision making about local control options. For cities like San Luis Obispo, which have relied on permissive zoning to address medical marijuana operations, the League has recommended the adoption of a resolution (effective upon adoption) formally affirming and clarifying the City’s interpretation and application of its existing zoning code. Accompanying this report is a resolution (Attachment A) that would clarify the City’s longstanding interpretation that medical marijuana cultivation is a prohibited use in the City, because it is not expressly or conditionally allowed under the City’s permissive zoning code. Staff will continue to evaluate the options available to the City Council regarding its local authority for permitting other uses under the new regulations. However, reaffirming the City’s permissive zoning code is an important step in preserving local control of cultivation activities as the state develops its regulations. In the future, the City would have the option to defer to the state licensing regulations if the City determines the state regulations create a desirable regulatory construct. Alternatively, the current action will ensure that the City will have the option of maintaining its existing permissive zoning prohibition. CONCURRENCES The Community Development Department and Police Department have reviewed and concur with the proposed approach. ENVIRONMENTAL REVIEW The resolution confirming existing law does not make any change in the current or historic policy or practice of the City, and the whole of such action is not an activ ity which may cause direct or reasonably foreseeable indirect physical change in the environment under Public Resources Code Section 21065 or California Environmental Quality Act (“CEQA”) Guidelines 13 Packet Pg. 124 Section 15378(a). Thus, the recommended action is exempt from, and not a project subject to, environmental review. Even if the adoption of this resolution reaffirming and confirming existing law are determined to constitute approval of a project under CEQA, and even if the project is not subject to any statutory or categorical exemptions, as a matter of common sense, it can be seen with certainty that there is no possibility that the activity in question, the adoption of this resolution reaffirming existing law, may have a significant effect on the environment under CEQA guidelines section 15061(b)(3). FISCAL IMPACT There is no fiscal impact associated with the recommended action. ALTERNATIVES 1. Decline to adopt the Resolution. Council could decline to adopt the recommended resolution and opt to simply rely on the staff level application of the City’s permissive zoning code. Staff would continue to decline applications for licenses, permits and entitlements for medical marijuana operations or uses and would continue to take enforcement action against unpermitted operations. This alternative is not recommended because the most clear and certain way to ensure the City’s right to assert its permissive zoning authority is to have a Council affirmation of the permissive zoning principles and their application to medical marijuana operations in the City. Failure to take affirmative action to clarify the City’s position could create undesirable ambiguity and in an unlikely, but worst case, could potentially result in ceding permitting and regulatory authority of cultivation activities to the State of California. 2. Adopt the Resolution and direct staff to develop and ordinance for the permitting or land use regulation or medical marijuana cultivation and/or other uses that would either expressly prohibit or conditionally allow activities that are currently unpermitted under permissive zoning and give staff direction as to the desired scope of regulations. This alternative is not recommended since the Council recently considered this policy alternative and det ermined that more explicit regulation was not necessary for our community. Should the council direct staff to pursue this alternative, staff would have to assess an approach to conducting the policy analysis and develop an outreach plan, as this topic is not currently in any department’s work plan. Depending on the scope of the desired approach and the level of public outreach directed, it is questionable whether this alternative could be accomplished by the existing March 2016 deadline. Attachments: a a - Resolution Permissive Zoning Medical Marijuana 13 Packet Pg. 125 R_______ RESOLUTION NO. (2015 SERIES) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS OBISPO, CALIFORNIA, REAFFIRMING THAT THE CITY’S PERMISSIVE ZONING CODE PROHIBITS MARIJUANA BUSINESSES, OPERATIONS AND USES, INCLUDING CULTIVATION OF MEDICAL MARIJUANA IN THE CITY, AND MAKING A FINDING THAT THE RESOLUTION IS EXEMPT FROM ENVIRONMENTAL REVIEW PURSUANT TO CEQA GUIDELINES SECTION 15061(B)(3) WHEREAS, the City Council acknowledges that the Compassionate Use Act (CUA), passed in 1996 by the voters of the State of California, provides a defense to criminal prosecution for the cultivation, possession and use of marijuana for medical purposes and the Medical Marijuana Program Act (MMPA) establishes a voluntary participation, State-authorized medical marijuana identification card and registry database for verification of qualified patients and their primary caregivers; and WHEREAS, the City Council expressly affirms that this Resolution is not intended, and shall not be construed, to interfere with any right, defense or immunity afforded to qualified patients or their caregivers under those acts; and WHEREAS, in October 2015, Governor Edmund G. Brown signed into law Assembly Bill 266, Assembly Bill 243 and Senate Bill 643, collectively known as the Medical Marijuana Regulation and Safety Act (MMRSA), which together create an extensive statewide regulatory and licensing system for the cultivation, manufacture, testing, dispensing, distribution and transport of medical marijuana, effective January 1, 2016; and WHEREAS, the MMRSA includes certain exemptions from state licensing requirements for medical marijuana cultivation by individual qualified patients, and primary caregivers with no more than five patients; and WHEREAS, the City’s current and intended ongoing regulatory practice regarding cultivation by such qualified patients and caregivers is to direct enforcement resources only toward those uses and activities that result in nuisance or adverse health and safety impacts to other City residents or neighborhoods; and WHEREAS, AB 266 contains most of the core provisions of the regulatory structure, and authorizes the Department of Consumer Affairs, through a newly created Bureau of Medical Marijuana Regulation, to license and control all medical marijuana businesses in the state. AB 266 includes local control provisions, such as a dual licensing structure requiring a state license and a local license or permit, and provides criminal immunity for licensees; and WHEREAS, SB 643 establishes criteria for licensing of medical marijuana businesses, regulates physicians and recognizes local authority to levy taxes and fees; and 13.a Packet Pg. 126 At t a c h m e n t : a - R e s o l u t i o n P e r m i s s i v e Z o n i n g M e d i c a l M a r i j u a n a ( 1 2 0 5 : M e d i c a l M a r i j u a n a R e s o l u t i o n ) Resolution No. _____ (2015 Series) Page 2 WHEREAS, AB 243 establishes a regulatory and licensing structure for indoor and outdoor cultivation of medical marijuana under the jurisdiction of the Department of Food and Agriculture, and requires dual licensing by the state and the city for the cultivation of medical marijuana within a city; and WHEREAS, neither the CUA, the MMPA, nor the MMRSA preempt or otherwise preclude the City’s exercise of its local land use and zoning authority; and WHEREAS, newly adopted Health and Safety Code Section 11362.77(c)(4), added by AB 243, states that if a city does not have land use regulations or ordinances regulating or prohibiting the cultivation of marijuana, either expressly or otherwise under principles of permissive zoning, or chooses not to administer a conditional permit program pursuant to that section, then as of March 1, 2016, the Department of Food and Agriculture will be the sole licensing authority for medical marijuana cultivation applicants in that city; and WHEREAS, San Luis Obispo Municipal Code Section Chapter 17.22, Use Regulations, sets forth the uses allowed by zones in the City and, in Section 17.22.010 C, provides that the regulations are intended to permit similar types of uses within each zone; that the Community Development Director shall determine whether uses that are not listed are deemed allowed or allowed subject to use permit approval in a certain zone; and that the interpretation procedure shall not be used as a substitute for the amendment procedure as a means of adding new types of uses to a zone; and WHEREAS, marijuana uses, including the cultivation of medical marijuana, remain illegal under federal law and the Council expressly declares that nothing in the City’s permissive zoning regulations is intended, or shall be interpreted, to allow or authorize the issuance of any City license, entitlement or permit for any use or activity that is otherwise prohibited by state or federal law, and that the City’s zoning code does not expressly or implicitly permit or make legal any use or activity that is illegal under state or federal law; and WHEREAS, the City Council hereby expressly affirms that the City zoning regulations are adopted and operate under principles of permissive zoning and that uses that are not expressly allowed or conditionally allowed under the zoning regulations are prohibited within the City of San Luis Obispo; and WHEREAS the City has consistently asserted its permissive zoning regulations as a basis to decline City permitting, licensing and entitlement applications for medical marijuana businesses and operations; and WHEREAS, on September 18, 2012, the City Council voted unanimously to approve its response to the San Luis Obispo County Grand Jury report entitled “Out of Sight, Out of Mind- Medical Marijuana in San Luis Obispo County”(“the 2012 Response”), wherein the City Council formally affirmed the City’s permissive zoning regulations, noted that neither brick and mortar medical marijuana collectives, nor collective delivery services were listed allowed uses in the Municipal Code and stated that, since such uses are not specifically allowed, “medical marijuana uses including medical marijuana collective delivery services are prohibited ;” and 13.a Packet Pg. 127 At t a c h m e n t : a - R e s o l u t i o n P e r m i s s i v e Z o n i n g M e d i c a l M a r i j u a n a ( 1 2 0 5 : M e d i c a l M a r i j u a n a R e s o l u t i o n ) Resolution No. _____ (2015 Series) Page 3 WHEREAS, marijuana businesses, operations or land uses, including but not limited to, medical marijuana cultivation, manufacture, storage, distribution, sale, dispensing, transport and delivery, are not expressly or conditionally allowed uses under the City’s permissive zoning regulations and, therefore, such uses are prohibited within the City under its permissive zoning regulations; and WHEREAS, the City’s zoning regulations do not establish the local consent required as a condition of the issuance of any state license for the cultivation of medical marijuana under the Medical Marijuana Regulation and Safety Act, and related statutory or regulatory licensing provisions as adopted in October 2015 or as they may subsequently be amended. NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis Obispo that for the reasons set forth above and herein: 1. The City Council reaffirms and declares that the City’s zoning regulations, as set forth in Title 17 of the San Luis Obispo Municipal Code, are adopted and operate under principles of permissive zoning. 2. The City Council expressly declares that, under the City’s permissive zoning code, any use that is not listed as an allowed or conditionally allowed use under the zoning regulations is prohibited. Marijuana uses, including but not limited to the cultivation of medical marijuana, are not listed as allowed or conditionally allowed within the City, are declared not to be similar to any listed allowed use and, therefore, have never been and are not currently allowed in the City. 3. The City Council further declares and directs that nothing in the City’s permissive zoning regulations or in this Resolution shall be interpreted to authorize or allow the issuance of any City license, entitlement or permit for, or to otherwise make legal or allow, any use or activity that is prohibited by local, state or federal law or to allow any use or activity that would otherwise constitute a nuisance under the laws of the City. 4. The City Council directs the State of California that no state license for the cultivation of marijuana, including medical marijuana, within the City of San Luis Obispo should be issued because such uses are not allowed under the City’s zoning regulations. 5. The reaffirmation and confirmation of existing law does not make any change in the current or historic policy or practice of the City, and the whole of such action is not an activity which may cause direct or reasonably foreseeable indirect physical change in the environment under Public Resources Code Section 21065 or California Environmental Quality Act (“CEQA”) Guidelines Section 15378(a) and, therefore, is exempt from, and not a project subject to, environmental review. 6. Even if the adoption of this resolution reaffirming and confirming existing law are determined to constitute approval of a project under CEQA, and even if the project is 13.a Packet Pg. 128 At t a c h m e n t : a - R e s o l u t i o n P e r m i s s i v e Z o n i n g M e d i c a l M a r i j u a n a ( 1 2 0 5 : M e d i c a l M a r i j u a n a R e s o l u t i o n ) Resolution No. _____ (2015 Series) Page 4 not subject to any statutory or categorical exemptions, as a matter of common sense, it can be seen with certainty that there is no possibility that the activity in question, the adoption of this resolution reaffirming and confirming existing law, may have a significant effect on the environment under CEQA guidelines section 15061(b)(3). Upon motion of _____________, seconded by_________________, and on the following roll call vote: AYES: NOES: ABSENT: The foregoing resolution was adopted this____ day of __________, 2015. ______________________ Mayor Jan Marx ATTEST: _______________________ Jon Ansolabehere Interim City Clerk APPROVED AS TO FORM: _______________________ J. Christine Dietrick City Attorney IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Luis Obispo, California, this ______ day of ______________________, __________. _______________________ Jon Ansolabehere Interim City Clerk 13.a Packet Pg. 129 At t a c h m e n t : a - R e s o l u t i o n P e r m i s s i v e Z o n i n g M e d i c a l M a r i j u a n a ( 1 2 0 5 : M e d i c a l M a r i j u a n a R e s o l u t i o n ) Medical Marijuana Resolution J. Christine Dietrick, City Attorney Special Thanks to the League of California Cities for its research and preparation of materials on this subject, which are heavily excerpted here What is the City Doing and Why Now? Staff recommendation is to adopt a resolution clarifying and affirming the City’s ongoing approach to medical marijuana businesses, highlighting cultivation operations. Ensures the greatest degree of local control as the State moves forward. New State law includes a provision that could result in ambiguity or ceding local control to the State if the City does not take formal action by March 1, 2016. No changes in current City permitting or enforcement approach are proposed, but a formal statement of City policy and permissive zoning standards is advised in light of state legislation and for ease of communicating local regulations to the State for State licensing purposes. Medical Marijuana Regulation and Safety Act Highlights Consists of three discrete pieces of legislation: AB 266 Creates a statewide regulatory and licensing scheme; provides for dual licensing: both a state license and a local permit or license, issued according to local ordinances, are required for cultivation, manufacturing, testing, dispensing, distribution and transport. Exempts patients and primary caregivers from the state licensing requirement Phases out the existing model of marijuana cooperatives and collectives one year after DCA announces that state licensing has begun. AB 243 Creates a regulatory and licensing structure for indoor and outdoor cultivation sites and environmental impact mitigation Provides that cities that do not have an ordinance, either expressly or under the principles of permissive zoning, regulating or prohibiting cultivation by March 1, 2016, will lose the authority to regulate or ban cultivation within their city limits. The state will become the sole licensing authority. SB 643 Establishes criteria for licensing of medical marijuana businesses and regulates physicians; includes “track and trace” provisions. Codifies dual licensing (state license and local license or permit), and itemizes disqualifying felonies for state licensure. Protects local power to levy fees and taxes. Local control is protected by: Dual licensing: A requirement in statute that all marijuana businesses must have both a state license, and a local license or permit, to operate legally in California. Jurisdictions that regulate or ban medical marijuana will be able to retain their regulations or ban. Effect of Local Revocation of a Permit or License: Revocation of a local license or permit terminates the ability of a marijuana business to operate in that jurisdiction under its state license. Enforcement: Local governments may enforce state law in addition to local ordinances, if they request that authority and if it is granted by the relevant state agency. State law penalties for unauthorized activity: Provides for civil penalties for unlicensed activity, and applicable criminal penalties under existing law will continue to apply. Expressly protects local licensing practices, zoning ordinances, and local actions taken under the constitutional police power. Area requiring immediate attention from the City – AB 243 Prohibits cultivation of medical marijuana without first obtaining both a local and a state license. Local license is required before applying for a state license. May not apply for a state license if cultivation will violate provisions of local ordinance or regulation, or if medical marijuana use is prohibited by the city either expressly or under principles of permissive zoning (Health & Safety 11372.777(b)). If there are no local land use regulations or ordinances regulating or prohibiting the cultivation of marijuana, either expressly or otherwise under the principles or permissive zoning, then commencing March 1, 2016, the state is the sole licensing authority for medical marijuana cultivation applicants (Health & Safety 11372.777(c)(4)). Under a “permissive” zoning code, “any use not enumerated in the code is presumptively prohibited.” City of Corona v. Naulis (2008) 166 Cal.App.4th 418, 425 cited in County of Sonoma v. Superior Court (2010) 190 Cal.App.4th 1312, FN. 3 Cultivation (AB 243) – Permissive Zoning: What action needs to be taken before March 1, 2016? Adopt a resolution that includes the following provisions: Re-affirms and confirms that the City’s Zoning Code is adopted and operates under the principles of permissive zoning; States this means that cultivation of marijuana is not allowed within the City because it is not expressly permitted and, Therefore, no State license for the cultivation of medical marijuana may be issued within the City. Questions? Recommendation: Adopt a resolution reaffirming that the City’s permissive zoning code prohibits marijuana businesses, operations and uses, including cultivation of medical marijuana in the city, and making a finding that the resolution is exempt from environmental review pursuant to CEQA Guidelines, Section 15061(b)(3). Key State Medical Marijuana Laws Following AB 243, AB 266, and SB 643 Medical Marijuana Regulation and Safety Act (Business and Profession Code section 19300 through 19360). Governs the licensing and control of all medical marijuana businesses in the state and provides criminal immunity for licensees. Compassionate Use Act of 1996 (Health and Safety Code section 11362.5). Provides criminal immunity for patients and primary caregivers for possession and cultivation of marijuana if a doctor has recommended the marijuana for medical use. Medical Marijuana Program (Health and Safety Code section 11362.7 through 11362.9). Establishes voluntary program for identification cards for qualified patients and primary caregivers and provides criminal immunity to qualified patients and primary caregivers for certain activities involving medical marijuana.