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MEDICAL CANNABIS REFUND REQUEST
RECOMMENDATION
It is recommended that the City Council adopt a motion authorizing the refund of the operator's permit fee in the amount of $30,000 to the Stockton Non-Profit Collective, Inc., DBA Port of Stockton Wellness Center.
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Summary
On May 2, 2011, Stockton Non-Profit Collective, Inc., DBA Port of Stockton Wellness Center ("Operator") paid a $30,000 operator's permit fee for the operation of a medical marijuana dispensary. On July 30, 2013, the City Council, by resolution number 1603-01, adopted an ordinance amending sections of the Stockton Municipal Code (SMC) Chapter 16 to prohibit medical marijuana dispensaries in the City of Stockton. Because Operator cannot operate a medical marijuana dispensary, it has requested a refund of the permit fee. Pursuant to SMC Section 3.60.020.B, Council must approve all refunds over $20,000. Therefore, staff seeks City Council approval to refund the operator's permit fee in the amount of $30,000.
DISCUSSION
Background
On May 2, 2011, Operator paid a $30,000 operator's permit fee to the city for a permit to operate a medical marijuana dispensary. On July 30, 2013, the City Council, by resolution 1603-01, adopted an ordinance amending (SMC) Sections 16.20.020 (Table 2-2, Land Uses, Services), 16.80.195 (Medical Cannabis), 16.88.3030 (Public Hearing Notices) and 16.240.020 (Definitions of Specialized Terms and Phrases) to prohibit the operation of medical marijuana dispensaries in the City of Stockton.
A combination of these events prevented the applicant from commencing operations. Therefore, on August 12, 2013, Operator submitted a Request for Refund in the amount of $30,000 (Attachment A- Original Request for Refund and Receipt of Payment).
Present Situation
On August 12, 2013, Operator requested a refund of the $30,000 operator's permit fee as it had never commenced operations.
SMC Section 3.06.020.A.3 states (in relevant part) that a refund may be made "where the applicant for any license or permit has not, at any time after the commencement of the period or term during which the requested license or permit would have been effective, performed any act for which the license or permit was required."
From August 2013 to the present, staff conducted substantial research requiring the coordination of several departments including: legal, community development, police and the administrative services. That research focused on determining what fees were paid, what refunds were owed, which fees required City Council approval for refund, and verification that the operator had never commenced operations. While the research confirmed that Operator had never commenced operations and that the $30,000 permit fee refund was subject to Council approval, it also caused a delay in submitting the refund request to Council for approval.
Staff now recommends that the Council adopt a motion authorizing the refund of the operator's permit fee in the amount of $30,000 to Operator pursuant to SMC Section 3.06.020.A.3 (Attachment B- Approved Request for Refund).
FINANCIAL SUMMARY
The operator's permit fee of $30,000 was deposited in account number 010-0170-329-13.00. The refund will be made from this account. There is no financial impact to the general fund.
ATTACHMENTS
Attachment A - Original Request for Refund and Receipt of Payment
Attachment B - Approved Request for Refund