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ADOPTION OF AN URGENCY ORDINANCE ESTABLISHING A TEMPORARY MORATORIUM ON THE ESTABLISHMENT OF NEW, AND RELOCATION OR PHYSICAL EXPANSION OF EXISTING TOBACCO RETAILER BUSINESSES, ALSO KNOWN AS SMOKESHOPS, WITHIN THE CITY OF STOCKTON, TO BECOME EFFECTIVE IMMEDIATELY
recommended action
RECOMMENDATION
Consider the adoption of an urgency ordinance with appropriate findings to establish a temporary moratorium on the establishment of new, and relocation or physical expansion of existing tobacco retailer businesses, also known as smoke shops, within the City of Stockton, to become effective immediately.
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Summary
Consistent with the City’s strategic goals for crime reduction and community improvement and responsive to the council and community concerns regarding the proliferation of tobacco retailers/smoke shops and illegal activity associated with these businesses, the Council is asked to consider the adoption of an urgency ordinance with appropriate findings to establish a temporary moratorium on the establishment of new, and relocation or physical expansion of existing tobacco retailer businesses, also known as smoke shops, within the City of Stockton, to become effective immediately
DISCUSSION
Background
On January 27, 2025, following staff presentation and discussion, the Council Legislation and Environmental Committee directed the City Attorney to bring an urgency ordinance in March, for the Council to consider imposing a moratorium on tobacco retailers/smoke shops. A moratorium is now presented for the City Council’s consideration.
Under the City of Stockton Charter section 300, the California Constitution Article XI, Sections 5 and 7, and pursuant to its police powers, the City of Stockton is authorized to implement regulations for a public purpose and for the general welfare. The City aims to protect the public health, safety, and welfare of its residents through zoning, licensing, and safety regulations of specific commercial activities.
In recent years, the City has experienced a proliferation of tobacco retailer businesses, also known as smoke shops, in the City of Stockton. There are approximately 163 tobacco retailer businesses, 78 of which are smoke shops operating with an active business license in the City of Stockton.
Amidst continued public health and safety concerns, particularly regarding crime, the sale of tobacco to minors, and adverse impacts on public health, there is a pressing need for the City to enact regulations. Several key actions in California highlight the ongoing challenges posed by tobacco retailing.
On November 8, 2022, California voters upheld the state law (“SB 793”) prohibiting a tobacco retailer, or any of the tobacco retailer’s agents or employees, from selling, offering for sale, or possessing with the intent to sell or offer for sale, most flavored tobacco products including flavored e-cigarettes and menthol cigarettes, as well as tobacco product flavor enhancers in retail locations (Attachment A).
On September 23, 2024, the California Department of Public Health (“CDPH”) promulgated emergency regulations related to industrial hemp and the threat to public health, safety, and welfare, particularly to minors. These regulations were published at the direction of California Governor Gavin Newsom, citing the increasing amounts of safety concern for the adverse health effects of intoxicating hemp food and beverage products (Attachments B-E).
These emergency regulations aim to combat hemp products containing tetrahydrocannabinol (“THC”) that skirt the age and sale restrictions that have been placed on recreational marijuana sold through licensed and regulated dispensaries.
Industrial hemp, as defined under state law, is permitted to contain a delta-9 THC concentration of no more than 0.3 percent on a dry weight basis; however, the emergency regulations prohibit industrial hemp final form food and beverage products, specifically, from containing any detectable level of THC. Hemp food and beverage products have been found to be sold in tobacco retailer businesses with marketing aimed toward children featuring cartoon characters, colorful packaging, and sweet candy flavors (Attachment F).
The emergency regulations published by CDPH expand on the number of psychoactive
cannabinoids that will need to be undetectable in industrial hemp final food form products, including edibles such as gummies, other candies, and drinks, as well as restricting the serving sizes such products contain to five servings or less and limiting sales of the products to consumers who are at least 21 years of age.
Aside from these emergency regulations, many state laws have been adopted, which
acknowledge the public health impacts of tobacco, especially flavored tobacco products, and specifically its effect on minors. For example, state law prohibits public school students from smoking or using tobacco products, while on campus, while attending school-sponsored activities, or while under the supervision or control of school district employees. State law also prohibits smoking in playgrounds. State law also prohibits smoking within 20 feet of the main entrances and exits of public buildings.
Additionally, Stockton Police confirmed that these businesses typically have more crime-related calls for service as compared to other businesses. Since the establishment of the Tobacco Retail License in 2023, the Stockton Police Department in collaboration with the California Department of Tax and Fee Administration, conducted 233 inspections at various tobacco retailers throughout the City. During those inspections the Department found evidence of and confiscated illegal tobacco products, including flavored tobacco, and found evidence of cannabis-infused items and illegal gambling. The inspections also resulted in numerous warnings and several citations for these illegal activities. The City can expect this to trend upward as the Police Department’s resources allow for more targeted inspection and enforcement efforts (Attachments G-I).
Additionally, efforts by other jurisdictions like Modesto and Fresno to crack down on these businesses with increased enforcement and tougher regulations, are indicative of both the need for more stringent regulations and the type of violations and activities the Stockton Police Department is likely to encounter as it increases its own efforts (Attachments J-N).
The City’s current Tobacco Retail Ordinance is primarily a licensing ordinance which encourages responsible tobacco retailing and discourages violations of tobacco-related laws, especially those that prohibit or discourage the sale or distribution of tobacco products to minors. While the Tobacco Retailer definition is broad enough to capture smoke shops, there are differences between Tobacco Retailers who sell tobacco products as an ancillary sale and those businesses where the primary and/or sole function is to sell tobacco products and tobacco paraphernalia. Some of these concerns were highlighted through comments submitted by the public and local advocacy groups in June 2023, when the City’s Tobacco Retailer Ordinance was first adopted (Attachment O). Some jurisdictions have enacted ordinances which already make this distinction (Attachment P) while some jurisdictions, like City of Modesto, are currently exploring their options.
Given these circumstances, the City Council recognizes the urgent need to address this public health and safety issues. The proposed moratorium on tobacco retailer businesses aims to tackle the immediate concerns of increased accessibility, the attractiveness of tobacco and hemp products to the City’s youth, and increasing amounts of crime and safety issues presented by such businesses. A moratorium will provide the City with the necessary time to assess the current situation, consider changes to existing regulations which more effectively address these concerns, and implement measures which protect the community and allow the City Manager and his staff to provide a proposed path forward to the Council.
Present Situation
California Government Code section 36937 authorizes the City Council to adopt an urgency ordinance for “the immediate preservation of the public peace, health, or safety.” Government Code section 65858 authorizes the City Council to adopt an interim ordinance “to protect the public safety, health, and welfare… to prohibit any uses that may be in conflict with a contemplated general plan, specific plan, or zoning proposal that the legislative body, planning commission, or planning department is considering or studying or intends to study within a reasonable time.”
As noted above, there is an immediate need to preserve and protect the public peace, health, safety, and welfare from the effects of tobacco use, tobacco retailing, hemp retailing, and other criminal activities that have been associated with these establishments.
City staff need time to analyze potential options available to the City in terms of regulation, and how other jurisdictions approach such problem businesses. These efforts are expected to result in an amended ordinance. Thus, an urgency ordinance meets the requirements of Government Code sections 36937 and 65858 and is needed immediately.
This moratorium will apply to Tobacco Retailers within the City that meet the criteria of a “tobacco retailer business” as defined under Stockton Municipal Code Section 5.104.020.
During the moratorium, no new license, permit, or other land use approval may be approved or issued by the City. This includes the issuance of a business license, building permit, conditional use permit, or other land use approval for the establishment, relocation, or physical expansion of a tobacco retailer business.
The attached Urgency Ordinance includes the requisite Government Code findings and, if adopted, would provide a 45-day moratorium to provide staff with time to research, study, and prepare recommendations for the Council’s consideration.
If adopted, no new tobacco retailing business, use, or operation may be established in the City. Such an ordinance must be approved by a four-fifths vote of the Council. Thereafter, the Ordinance would remain in effect for 45 days unless repealed, terminated, or extended by the Council pursuant to Government Code section 65858.
This moratorium is consistent with the Council Priority Goals from the City’s Fiscal Year 2024-25 One-Page Strategic Plan:
• “Focus on crime reduction in focus areas”
• “Leverage city and partner resources in impacting overall public health, community wellbeing, and community resiliency”
FINANCIAL IMPACT
There is no financial impact to the City associated with this item.
Attachment A- CDPH Emergency Regulations main website page
Attachment B- CDPH Notice of Proposed Emergency Regulatory Action
Attachment C- CDPH Finding of Emergency
Attachment D- CDPH Emergency Regulations Text
Attachment E- Forbes Article “California Governor Unveils Emergency Ban on Hemp Products with THC”
Attachment F- FDA Article
Attachment G- ABC10.com Stockton Article
Attachment H- Stocktonia Article
Attachment I- Stockton Police Department Post
Attachment J- Modesto KCRA Article
Attachment K- Modesto Bee Article
Attachment L- Modesto Press Release
Attachment M- ABC30 Article City of Fresno
Attachment N- Fresno Bee Article
Attachment O- 2023 Public Comments
Attachment P - City of Covina Tobacco Ordinance