Oakland Medical Cannabis Ordinance Update

April 27, 2016

By Alex Zavell Senior Regulatory Analyst

Robert A. Raich, P.C. alex@robertraich.com

Two Ordinances

• 5.80 – Retail

• 5.81 – Non-retail

Both passed City Council Public Safety Committee on 4/26, going to full City Council for first read on 5/3

Ordinance 5.80 – Retail Storefronts

– Replaces current limit of 8 storefronts with authorization of 8 new licenses per year • Can be located in zones that allow for

commercial and industrial activities. • Annually renewed “Special Activity Permit” (not

a land use entitlement) • Eliminates all mandatory distance requirements

except for 600 buffer from schools and youth centers. • Subject to a public hearing. • Replaces strict distance buffers with

requirement that applicant demonstrate non-impact.

5.80 – Onsite Consumption

–Creates a new onsite consumption permit • Separate permit available only to

permitted dispensaries. • Will allow for non-smoke (combustion)

ingestion – i.e. vaporizing and edible consumption. • Smoking prohibited “inside” the premises.

Ordinance 5.80 – Delivery

• Creates delivery-only licenses – Can be located in same areas as storefront

dispensaries. – No limit on number that can be issued. – No public hearing required. – Location cannot be open to the public – can

only make deliveries.

Dispensary Zones

MAPS FROM OLDER DRAFT OF ORDINANCE, NOW OUT OF DATE – USED AS EXAMPLE

5.81 – Non-Retail Licenses

• Annually renewed “Special Activity Permit” (not a land use entitlement)

• Mostly mirrors MMRSA license-type categories. • Does not distinguish sub-types within an activity

based on size (i.e. only one type of cultivation permit – not type 1, type 2, type 3).

• Only sensitive use buffer is 600 feet buffer from schools.

• No cap on the number of permits that can be issued

Cultivation, Distribution, Testing, and Transporting

Permitted in zones allowing light manufacturing or research and development

MAPS FROM OLDER DRAFT OF ORDINANCE, NOW OUT OF DATE – USED AS EXAMPLE

Non-Volatile Manufacturing

Permitted in zones allowing custom manufacturing

MAPS FROM OLDER DRAFT OF ORDINANCE, NOW OUT OF DATE – USED AS EXAMPLE

Volatile Manufacturing

Permitted in zones allowing general manufacturing

MAPS FROM OLDER DRAFT OF ORDINANCE, NOW OUT OF DATE – USED AS EXAMPLE

Permitted Activities and ZonesType of Activity Zoning

Cultivation, distribution, testing, and transporting

Light manufacturing or research and development

Dispensary Commercial or industrial

Non-volatile manufacturing

Custom manufacturing

Volatile manufacturing General manufacturing

Zoning Concept: Conditional vs. By Right

• Cannabis activities are allowed only in zones that allow for the relevant manufacturing activity by right.

• Cannabis activities are prohibited in zones that would require a conditional use permit for the manufacturing activity. The City wants to avoid the public hearings and land use entitlements involved with CUPs.

Zoning Concept: Administrative Discretion

Other Zoning Issues

• Multiple permits may be issued to a single parcel/building.

• Compliance with building and fire codes required independent of cannabis activity permit.

• Edible makers who fall under California Homemade Food Act operator standards may be able to operate in residential zones

• Residential cultivation is allowed by patients and caregivers for non-commercial personal use, but will not be permitted to enter the commercial supply chain

Permit and Regulatory Fees

Employee Hiring Provisions

• Staff must be 50% Oakland residents, with at least 25% being Oakland residents from census tracts identified by the City as high-unemployment areas.

• Businesses that hire formerly incarcerated Oakland residents can apply for a tax credit or license fee reduction.

• City may develop phase-in of these requirements for existing businesses

Ownership Requirements

• For dispensaries (5.80.020(e)): – “Priority shall be given to dispensary applicants owned

and operated by Oakland residents, in particular applicants owned and operated by Oakland residents in census tracts identified by the City Administrator as having high unemployment rates.”

• New amendment from 4/26 Public Safety Committee: – 50% of dispensary and cultivation licenses must be

issued to applicants with a majority shareholder stake (>50%) from an Oakland census tract or police beat heavily impacted by War on Drugs.

So, what about SF?