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COMMISSION USE PERMIT TO ESTABLISH A MICROBUSINESS CONSISTING OF THE FOLLOWING THREE CANNABIS USES: RETAIL STOREFRONT, DISTRIBUTION, AND MANUFACTURING, IN AN EXISTING 5,760 SQUARE FOOT INDUSTRIAL BUILDING AT 2455 STATION DRIVE (APPLICATION NO. P20-0720)
recommended action
RECOMMENDATION
Staff recommends that the Planning Commission adopt a resolution approving a Commission Use Permit to allow the establishment of a proposed cannabis microbusiness consisting of retail, distribution, and manufacturing in an existing 5,760 square foot industrial space, in accordance with the findings and subject to the conditions in the Proposed Resolution.
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SUMMARY
The applicant, Jamie Winkles, submitted a Commission Use Permit (CUP) application to establish a 5,760 square foot cannabis microbusiness in an Industrial, General (IG) zoned parcel, located at 2455 Station Drive. The proposed microbusiness would occupy a vacant warehouse in an eight (8) building business park.
The applicant participated in the 2019 Commercial Cannabis Lottery program and was awarded the opportunity to apply for one annual Cannabis Microbusiness CUP as a general pool applicant.
Staff recommends approval as the proposed project aligns with the following General Plan 2040 goals and policies:
• Goal LU-6: To provide for orderly, well-planned, and balanced development.
• Goal LU-4: Attract and retain companies that offer high-quality jobs with wages that are competitive with the region and state.
• Goal CH-3: Expand opportunities for local enterprise, entrepreneurship, and gainful employment.
• Policy LU-4.2: Attract employment and tax-generating businesses that support the economic diversity of the city.
As conditioned in the accompanying Resolution, the project will comply with all applicable provisions of the Development Code and the Municipal Code, including the location requirements oulined in SMC Section 16.80.195H(5) which requires seperation from sensitive uses (i.e. residential zones, parks, schools, etc.). There is no Location Waiver request with this application.
DISCUSSION
Background
On March 5, 2019, City Council approved changes to the City’s cannabis regulatory program to: (a) align state/local regulation; (b) allow additional business types; (c) establish a method to control the pace of new business openings; and (d) establish a method to address historic racial inequities.
New business types were introduced, including manufacturing, distribution, testing laboratories, delivery-only non-storefront retailers, and microbusinesses. The program also included additional cultivators and storefront retailers (dispensaries) as well as an equity program to address historic racial inequities. The changes were to align local regulation with the Medical Cannabis Regulation and Safety Act and the Adult-Use of Marijuana Act of 2016 (Proposition 64). In addition to achieving regulatory consistency, the program was changed to eliminate the limit (i.e. caps) on the total number of Operator Permits regulated by the Stockton Police Department under SMC Chapter 5.100.
For certain permit types (storefront retailer, cultivation, volatile-manufacturing, and microbusinesses) where there is concern about the potential impact on public safety, public health, or community character, a Controlled Expansion Program was established. A Controlled Expansion Program allows the City and the existing businesses to adapt to an evolving industry and gives the City ongoing flexibility to accelerate or decelerate industry expansion over time. The Controlled Expansion Program also has the benefit of allowing the City to give preference to equity applicants.
The Controlled Expansion Program is accomplished on an annual basis through a lottery process for the following business types:
a. storefront retailer
b. cultivation
c. volatile-manufacturing
d. microbusinesses, which include storefront retail and/or cultivation business types
Applicants for the above business types are evenly selected by the lottery process from two pools for a total of eight (8) applications per year, as described below:
Equity Pool
a. One (1) storefront retailer permit
b. One (1) cultivation permit
c. One (1) volatile-manufacturing permit
d. One (1) microbusiness permit
General Pool
a. One (1) storefront retailer permit
b. One (1) cultivation permit
c. One (1) volatile-manufacturing permit
d. One (1) microbusiness permit
The lottery includes an equity component (i.e. Equity Pool) to enable Stockton residents from disadvantaged neighborhoods to obtain cannabis business permits. Applicants for the above business types are evenly selected from 1) a general pool of applicants, and 2) an equity pool of applicants.
Present Situation
The applicant requests approval to operate a 5,760 square foot cannabis microbusiness at 2455 Station Drive within an Industrial, General (IG) Zone (Attachment A - Location Map). The proposed microbusiness includes 2,240 square feet of retail storefront and 3,520 square feet for back of house, which includes a distribution area of 1,740 square feet, 360 square feet of manufacturing, and approximately 1,420 square feet for common areas (Attachment B - Project Plans).
The proposed project is located within the Stockton Triangle Industrial Park subdivision; the entire neighborhood is zoned for industrial uses. The existing building is within an eight (8) building business park. The surrounding uses include a weighing device manufacturer to the north; a distribution facility to the east; a crematory to the south; a mold removal facility to the west; and a sheet metal facility is adjacent to the project site.
Per SMC Section 16.80.195(H) (Microbusiness Operators Permit - Land Use Process) such use shall be reviewed by the City based on the Use Permit Subtype of a combination of Retailer (R), Distributor (D), Cultivator (C), or Manufacturer (M) and organized as an RDC, RDM, RCM, or DCM; and must be located within the Industrial, Limited, Mixed Use or Industrial, General zones, which is consistent with the zoning of the project site. To qualify as a microbusiness, the proposed project must engage in at least three (3) of the following commercial cannabis business activities:
a. Retailer or Retailer - Non-Storefront
b. Distributor or Distributor - Transport Only
c. Cultivation - Less than 10,000 sq. ft.
d. Manufacturer
The proposed project is consistent with the RDM subtype since the applicant proposes to conduct retail storefront, distribution, and manufacturing, in accordance with SMC 16.80.195 Section (H).
The retail storefront portion of the business will operate between 9:00 a.m. and 8:00 p.m. Monday through Sunday; and the distribution and manufacturing will operate between 9:00 a.m. and 5:00 p.m. Monday through Friday. The applicant will employ approximately 32 full-time employees within the first year (Attachment C - Project Description).
If the cannabis microbusiness is approved, a formal security plan and lighting plan will be submitted and reviewed by the Police Department as part of an Operators Permit application to ensure safe operations.
The proposed business will provide eleven (11) on-site parking spaces, of which eleven (11) spaces are required by the Code. The number of parking stalls is consistent with the requirements for proposed cannabis businesses and, therefore, is adequate to service the business.
Staff Analysis
To permit the proposed uses, the Planning Commission is asked to consider approval of a Commission Use Permit. The request and staff’s analysis are provided below.
Commission Use Permit
When located in an IG Zone, a Commission Use Permit is required for a Cannabis Microbusiness. The operations of the proposed use would be carried out within the project site. The following analysis addresses the proposed land use.
SMC section 16.168.050(A) requires seven (7) findings of fact to grant approval. Each finding and staff’s analysis are as follows:
1. Finding: The proposed use is allowed within the subject zoning district with the approval of a use permit and complies with all other applicable provisions of this Development Code and the Municipal Code.
Staff Analysis: The proposed cannabis business type (i.e., use) is conditionally allowed in the IG Zone with approval of a Commission Use Permit. As conditioned, the cannabis microbusiness use will be in conformance with the development standards outlined in Title 16 of the Municipal Code. Adequate off-street parking spaces will be provided for the proposed use.
The proposed project meets the location requirements set forth in SMC 16.80.195.H(5) a through d. The project is not located within 300-feet of any existing residential zone. The project is not located within 600-feet of any park, school providing instruction in kindergarten or any grades 1 through 12, day care center, or youth center, childcare center, child care, in-home (family day care home), religious facilities, or drug abuse or alcohol recovery/treatment facility.
2. Finding: The proposed use would maintain or strengthen the integrity and character of the neighborhood and zoning district in which it is to be located.
Staff Analysis: The proposed cannabis microbusiness would be situated in an eight (8) building business park, situated near several other industrial uses. It would fill an existing unoccupied site which would help strengthen the integrity and security of the surrounding area by providing added security due to the nature of the land use. The proposed use would also align with the intent of the general plan to attract employment and tax-generating businesses that support the economic diversity of the city.
3. Finding: The proposed use would be consistent with the general land uses, objectives, policies, and programs of the General Plan and any applicable specific plan or master development plan.
Staff Analysis: The General Plan Land Use Map designates the subject site as Industrial. The Industrial designation is intended to accommodate a wide variety of industrial uses, including, but not limited to, uses with nuisance or hazardous characteristics, warehousing, light manufacturing, and other related uses. The proposed use is a cannabis microbusiness where cannabis products will be manufactured, distributed, and sold on-site, all of which are consistent with the uses described in the General Plan for the Industrial land use designation. The zoning district designation of Industrial, General IG is also consistent with the City’s General Plan Industrial land use designation for the project site.
Additionally, the project is consistent with the following General Plan goals and policies:
• Goal CH-3 which states, “expand opportunities for local enterprise, entrepreneurship, and gainful employment.” and;
• General Plan Policy LU-4.2 which states, “attract employment- and tax-generating businesses that support the economic diversity of the city.”
The proposed use furthers the above goal and policy since it would provide for a business type that generates tax revenue for the City of Stockton’s general fund and also expands opportunities for employment and entrepreneurship.
4. Finding: The subject site would be physically suitable for the type and density/intensity of use being proposed including the provision of services (e.g., sanitation and water), public access, and the absence of physical constraints (e.g., earth movement, flooding, etc.).
Staff Analysis: The project has been analyzed by all applicable departments, and it has been determined that all existing streets and public access ways are adequate to serve the proposed project. The site will have access to City utility services. Further, a Building Permit is required for the proposed cannabis facility, and the project will be required to comply with all applicable Building Code standards.
5. Finding: The establishment, maintenance, or operation of the proposed use at the location proposed and for the time period(s) identified, if applicable, would not endanger, jeopardize, or otherwise constitute a hazard to the public convenience, health, interest, safety, peace, or general welfare of persons residing or working in the neighborhood of the proposed use.
Staff Analysis: The proposed land use will require the applicant to adhere to all applicable Building Code, Fire Code, and additional requirements established by the State of California, Department of Cannabis Control. The Department of Cannabis Control issues annual licenses and regulates cannabis microbusinesses to ensure safe practices. The applicant will also be required to obtain and maintain an Operator’s Permit from the City that requires the business owner to develop and maintain a security and lighting plan that is reviewed annually by the Police Department.
All cannabis operations for the proposed microbusiness will occur indoors, in an Industrial zone. Appropriate security provisions will be incorporated into the project operations plan, including electronic surveillance and on-site security. The site will use an activated carbon filtration system to prevent any odors from spilling outside of the facility.
For the above reasons, the establishment, maintenance, or operation of the proposed land use activity would not endanger, jeopardize, or otherwise constitute a hazard to the public convenience, health interest, safety, or general welfare of persons residing or working in the neighborhood of the proposed use.
6. Finding: The design, location, size, and operating characteristics of the proposed use would be compatible with the existing and future land uses on-site and in the vicinity of the subject property.
Staff Analysis: The proposed microbusiness is located in an existing vacant building in an industrial zone near existing metal processing and logistics facilities. The proposed use is industrial and raises no potential issues related to compatibility with the existing and future land uses on-site and in the vicinity of the subject property.
7. Finding: The proposed action would be in compliance with the provisions of the California Environmental Quality Act (CEQA) and the City’s CEQA Guidelines.
Staff Analysis: The proposed project will occupy an existing facility, located within an eight (8) building business park, situated near several other industrial uses. The project is categorically exempt from the CEQA, pursuant to CEQA Guidelines section 15301(a) (Existing Facilites) since the project will occupy an existing facility and no expansion of use is proposed.
As a point of reference, Staff has provided a location map of currently approved cannabis retail storefront, distribution, and manufacturing businesses as an attachment to this report (Attachment D - Existing Commercial Cannabis Businesses). Currently, there are no proximity restrictions in the Development Code between cannabis businesses, so this is being provided as information only.
PUBLIC COMMENT
Notice for this item was published in the Record on October 4, 2021, and a notice has been sent to all property owners within a 300-foot radius of 2455 Station Drive.
Attachment A - Location Map
Attachment B - Project Plans
Attachment C - Project Description
Attachment D - Existing Commercial Cannabis Businesses
This report was prepared by Ricardo Pozos, Contract Planner, (323) 955-5505 ext. 3322; rpozos@placeworks.com.