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CANNABIS BUSINESS OPERATING HOURS
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RECOMMENDATION
Receive information related to codified allowable Cannabis Business Hours and comparison with State law allowances.
Provide staff direction pertaining to the regulation therein.
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Summary
Current codified Cannabis Business operating hours are 7:00am to 8:00pm as established by Stockton Municipal Code (SMC) Section 5.100.280 (Attachment A). California Code of Regulations (CCR) allows cannabis business operations between 6:00am and 10:00pm (Attachment B). As a result of public comment, staff is requesting direction whether to amend the SMC to align with State regulations.
DISCUSSION
Background
In 2016, California voters passed Proposition 64, The Adult Use of Marijuana Act, legalizing the personal use and cultivation of marijuana for adults 21 years of age or older; reducing criminal penalties for specified marijuana-related offenses for adults and juveniles; and authorizing resentencing or dismissal and sealing of prior, eligible marijuana-related convictions. The proposition included provisions on regulation, licensing, and taxation of legalized use.
Resolution 2016-06-28-1503-01 was adopted by the City Council to place Measures P and Q on the same November 8, 2016 ballot to remove the prohibition on medical cannabis dispensaries and allow medical cannabis cultivation businesses within the City, both measures passed by Stockton voters.
As a part of that effort, the City Attorney’s Office was directed to draft said measures to overturn the then current ban on medical cannabis dispensaries and cultivation, increase the business license tax on medical cannabis businesses, and modernize the City’s applicable Code provisions to adhere to changes in State law (i.e. the Medical Marijuana Regulation and Safety Act - passed on September 11, 2015). Cannabis Business operating hours of 7:00am to 8:00pm were approved via said effort, have remained consistent, and are reflected in the current cannabis ordinance (Stockton Municipal Code Section 5.100.280).
During the June 12, 2024 Council Legislation/Environmental Committee meeting, Anthony Barkett (Atlas Properties) submitted a public comment requesting the Committee’s consideration of amending codified cannabis operating hours to align with State Law (California Code of Regulations allows cannabis business operations “between the hours of 6:00 a.m. Pacific Time and 10:00 p.m. Pacific Time”) and to allow his tenant more economic opportunity as there is increased competition from dispensaries in neighboring communities.
Present Situation
Since legalization in 2016, California’s cannabis economy has experienced significant growth in certain areas, with 1,203 retailer storefront licenses issued by the Department of Cannabis Control as of August 5, 2024. Statewide, 46% of Cities and Counties allow at least one cannabis business type. As of July 2024, in San Joaquin County, only three cities have a full cannabis ban: Lodi, Escalon, and Ripon. Stockton storefront (retail) cannabis businesses compete with neighboring businesses within Stockton (5 currently operating, including the referenced tenant), in Lathrop (1) and Tracy (5), details are listed in Table 1.
On March 1, 2022, City Council adopted Ordinance No. 2022-03-01-1601 amending the Cannabis Regulatory Program to include a cap of fourteen (14) on retail storefront businesses, among other regulations. As of the writing of this report, nine (9) retail storefront cannabis businesses have approved Use Permits, five (5) of which are open and operating.
Table 1 - Regional* Cannabis Retail Storefront (Dispensaries) Businesses Currently in Operation
|
Stockton |
Lathrop |
Tracy† |
|
Port City Alternative of Stockton Inc. |
Serenity of Lathrop - Manteca |
Garden Of Eden |
|
Zen Garden Wellness |
|
Tracy Cannabis Collective |
|
Connected Stockton |
|
Tracy Farms |
|
Packs |
|
X1 |
|
Coastal |
|
Embarc Tracy |
• Manteca does not have any Retail Storefronts in operation
†As of 1/5/2024, 10 Use Permits had been approved for Retail Storefronts
Extending cannabis business operating hours can result in both positive and negative results, summarized as follows:
Table 2 - Potential Impacts of Extending Business Hours
|
Pros |
Cons |
|
Increased economic activity for businesses |
Increased traffic in cannabis business areas |
|
Increased sales tax collection |
Increased off-site consumption of cannabis |
|
Job generation |
Potential increase of out-of-town traffic for cannabis purposes |
|
Increased access to regulated cannabis |
Further saturation of local cannabis market |
|
Increased customer convenience |
Potential for increased crime |
Per Proposition 64, local jurisdictions have the authority to regulate cannabis businesses, including the banning thereof (BPC Section 26200). Extending cannabis business operating hours is a policy decision which would require an amendment to Title 5 (Business License and Regulations) of the Stockton Municipal Code, of which the Administrative Services Department would be responsible for.
Staff is seeking policy direction from the Committee in regard to amending current codified Cannabis Business Operating Hours to align with State law
Attachment A - SMC Section 5.100.280
Attachment B - CCR Section 15403