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APPEAL OF THE PLANNING COMMISSION’S DENIAL OF A COMMISSION USE PERMIT TO ESTABLISH A RETAIL STOREFRONT CANNABIS BUSINESS, ADMINISTRATIVE USE PERMIT TO ESTABLISH A RETAIL NON-STOREFRONT (DELIVERY ONLY) CANNABIS BUSINESS, AND A WAIVER OF CANNABIS BUSINESS LOCATION REQUIREMENTS - AT 6709 PLYMOUTH ROAD, SUITES C & D (APPLICATION NO. P20-0596)
recommended action
RECOMMENDATION
Staff recommends that the City Council adopt a resolution to:
1. Reverse the Planning Commission’s denial of a Commission Use Permit to allow the establishment of a proposed retail storefront cannabis business, in accordance with the findings and subject to the conditions herein;
2. Reverse the Planning Commission’s denial of an Administrative Use Permit to allow a retail non-storefront (delivery only) cannabis business, in accordance with the findings and subject to the conditions herein; and
3. Approve a Waiver to reduce the location requirement to separate commercial cannabis businesses from childcare centers from at least 600 feet to approximately 574 feet.
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Summary
The Project applicant, Alissa Metzger, submitted an application that consists of a Commission Use Permit, Administrative Use Permit, and Waiver to establish a 4,123-square foot retail storefront cannabis business and a retail non-storefront (delivery only) cannabis business in a Commercial General (CG) zoned parcel, located at 6709 Plymouth Road, Suites C & D. The site is currently a multi-tenant commercial building with a convenience store and pizza restaurant as occupying tenants in the adjacent suites (Attachment A - Location Map).
On December 10, 2020, the Planning Commission held a public hearing and considered Staff’s presentation and recommendation for approval of the project. Additonally, the Applicant spoke on behalf of the project. There were no members of the public in attendance to speak on the project. After discussion, the Planning Commission denied the Commission Use Permit, Administrative Use Permit, and Waiver request (by a 4-3 vote, with Commissioners Rizvi, Mallett, and Garcia dissenting).
The proposed storefront cannabis business is 574 feet from a neighboring childcare center. The location waiver requested a reduction of separation from the required 600 feet to 574 feet on the practical application/barriers between the proposed use and sensitive use.
The Project applicant filed an appeal of the Plannining Commission decision on December 21, 2020 for City Council’s consideration (Attachment B - Appeal Letter). The appeal contests the Planning Commission’s findings supporting denial of the application and the applicant requests that City Council reverse the Planning Commission’s denial, and approve the Commission Use Permit, Adminstrative Use Permit, and location wavier.
Staff finds that the proposed project aligns with the General Plan 2040 goals and complies with all technical Code requirements except for the location requirement. However, staff believes the location fits the conditions meriting a waiver. Staff recommends that the City Council reverse the Planning Commission’s denial of the proposed project.
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 businesses 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. 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 Stockton Municipal Code (SMC) Chapter 5.100.
Since concern was expressed about potential impact on public safety, public health, or community character, a controlled roll-out program was established for certain permit types. The controlled expansion program allows the City and the existing industry to adapt to an evolving market and gives the City ongoing flexibility to accelerate or decelerate industry expansion over time. The controlled expansion also has the benefit of allowing the City to give preference to equity applicants.
The controlled expansion is accomplished on an annual basis through a lottery process for the following business types:
• storefront retailer
• cultivation
• volatile-manufacturing
• microbusinesses, which includes 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 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) microbusinesses
General Pool
a. One (1) storefront retailer permit
b. One (1) cultivation permit
c. One (1) volatile-manufacturing permit
d. One (1) microbusinesses
Equity pool applicants must meet certain criteria and are also eligible to be a part of the general pool. To qualify as an equity applicant, an applicant must own more than 50 percent of the business, be a resident of Stockton, and meet one of the following: be a Minority Business Enterprise (MBE)/Women Owned Business Enterprise (WBE), live in an opportunity zone, live in the Senate Bill 535 disadvantaged area, or live in a Housing and Urban Department (HUD) designated area.
Alissa Metzger, the applicant of the proposed project, is a successful 2019 general pool applicant for a storefront retailer business. The Non-storefront Retail (delivery only) use is not granted through the Commercial Cannabis Lottery program and there are no limits or “caps” to the number of applications that may be approved.
Stockton Municipal Code (SMC) Section 16.80.195 provides a land use process for permitting cannabis business types and standards for development, which includes location restrictions. The SMC imposes a limit on the total number of permits allowed citywide for storefront retailers but not for non-storefront retailer (delivery only). The Code provides limitations through a Commercial lottery program described above. In addition, market availability of retail space in the allowable zones provides some natural limitations.
The SMC contains location requirements for both Retail Storefront and Retailer Non-Storefront (Delivery Only) uses, which are the same. A minimum 300-foot separation is required from any residenitial zone, which is technically met. The Code also requires a minimum 600-foot separation from any park, K-12 school, day care/youth/childcare center, childcare, in-home (family day care home), religious facilities, and/or drug abuse, or alcohol recovery/treatment facility that is in existence at the time the land use permit is issued. Both distances are measured in a straight line from the closest point between property lines.
One issue raised by the Planning Commission relates to the location requirement prohibiting operation within 300 feet of a residential zone. For this project, the adjacent property due east on Plymouth Road is zoned Commercial General. However, the SMC allows multifamily housing within this zone and there is in fact, multifamily housing in this area. Therefore, while not violating the Municipal Code, the Planning Commission raised concerns that a technical reading of the Code might be inconsistent with the intent of the code in providing separation between residential housing and this use. The Code’s use of the word “zone” instead of “use” fails to take into account the allowance of multifamily housing in areas not zoned residential. However, despite adequate notice and public outreach (described below), the City received no community opposition to the proposed use. As such, staff found the project consistent with the Code and recommended approval.
Staff analysis determined that the proposed business location site property line is approximately 574 feet from a childcare center site property line located south west of the property on the opposite (west) side of Interstate 5 (I-5). The Code currently allows waivers for unique situations where the literal application of the distance requirement is not reasonable. Here, the applicant requests a Waiver due to the unique physical barrier created by the I-5 freeway, which leaves an approximate 1,500-foot path of travel (pedestrian) separation between the proposed project site and the daycare center.
Public Outreach
Although not required by the Stockton Municipal Code, a virtual community meeting was held in advance of the Planning Commission meeting on November 2, 2020 via Zoom. All property owners within a 300-foot radius of the subject property were invited to the meeting. This included the owners of a multi-family apartment complex directly across the street. The applicant representative, property owners, and City staff attended the virtual community meeting held on Monday, November 2, 2020 at 5:00 pm; no community members attended. The applicant recorded the presentation and made it available to community members by request.
Present Situation
The applicant requests approval to operate a 4,123-square foot retail storefront and non-storefront retail (delivery only) commercial cannabis business in a Commercial, General (CG) Zone located at 6709 Plymouth Road, Suites C & D. See Attachment C - Proposed Site Plan.
This site location is a commercial center which includes a pizza restaurant and a convenience store. A hotel is located to the north of the property and a gas station is located to the south of the property. The I-5 freeway lies directly west of the property and a multi-family apartment complex and Swanson golf course are located east of the property. The multi-family apartment complex is in a commercial zone and therefore meets the location requirement set forth in Section 16.80.195.A.6.a of the Municipal Code: “No retailer operator shall be established or located within 300 feet of any existing residential zone”.
The retail storefront will operate between 9:00 a.m. and 8:00 p.m. Monday through Sunday, and the non-storefront retail (delivery only) will operate between 9:00 a.m. and 7:00 p.m. Monday through Sunday. The proposed project will employ 20 full-time employees.
The existing commercial center has 17 shared parking stalls. 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 project, the City Council is asked to consider reversing the Planning Commission’s denial thereby approving a Commission Use Permit (CUP), an Administrative Use Permit (AUP), and a Waiver to reduce the required separation from a childcare center from 600 feet to 574 feet for the proposed retail storefront and retail non-storefront cannabis business.
The City Council may uphold the Commission’s action and deny the appeal or reverse the Commission’s action with 4 concurring votes (a majority vote), in accordance with SMC Section 16.100.040.G.1. Each request and staff’s analysis are provided below.
Commission Use Permit/Administrative Use Permit
When located in a CG Zone, a Commission Use Permit is required for a Cannabis Retailer Storefront and an Administrative Use Permit is required for a Non-storefront cannabis retail (delivery only). The operations of each use would be combined within a single business and within the same building area. As a result, and since the findings required to address each permit type are the same, the following analysis addresses both land uses.
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 two proposed cannabis business types (i.e., uses) are both allowed in the CG Zone. The subject uses would be located within an existing commercial building and, therefore, do no raise a question of conformance with Title 16 development standards, except for the location requirements which are being addressed through the request for wavier. As noted below, adequate off-street parking spaces are provided for both the existing and proposed uses.
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 cananbis business would be situated in a shopping center with several other commercial land uses. It would be aligned with the intent of the shopping center to provide retail options to the community. It would prevent the shopping center from having a vacant unoccupied suite which would help strengthen the integrity of the surrounding area by encouraging secured use of the site which will discourage vandalism, graffiti, and crime due to the increased level of security required for this business type.
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 Commercial. The Commercial designation is intended to accommodate a wide variety of commercial uses, including, but not limited to, service uses. SMC Section 16.20.020 Table 2-2 classifies the Cannabis Retail Storefront and the Non-storefront Cannabis Retail Operator Permit (Delivery Only) use within a service use category. Therefore, the proposed use is consistent with the Commercial designation.
Additionally, the project is consistent with 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 this policy since it would provide for a business type that generates tax revenue for the City of Stockton’s general fund.
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 proposed project is reusing a portion of an existing commercial building. The project has been analyzed by all departments and it has been determined all streets and public access ways are adequate to serve the proposed project. The site will have access to City water services and the Municipal Utilities Department has reviewed the project.
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 requirements established by the State of California, Bureau of Cannabis Control (BCC). The BCC issues annual licenses and monitors Retail Storefronts and Non-Storefront Retail (delivery only) to ensure safety of business practices. The applicant will also be required to obtain and maintain a City of Stockton Operator’s Permit that requires the business owner to develop and maintain a security and lighting plan that is reviewed annually by the City of Stockton Police Department.
The operations are being carried out indoors, in a commercial zone; appropriate security provisions will be incorporated into the project operations plan, including both electronic surveillance and on-site security personnel procedures.
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; and
Staff Analysis: The proposed Retail Storefront and Non-Storefront Retail (delivery only) is located in an existing commercial building and no changes have been proposed to the exterior characteristics of the project site. The proposed use is commercial in nature and modest floor area raises no potential issues related to compatibility with the existing and future land uses on-site and in the vicinity of the subject property. The project site is adjacent to a public golf course (Swenson Golf Course). The entrance to the golf course is not located on the west side of the property where the property fronts. Patrons of the golf course would not access Plymouth Road to enter the golf course. The distance and natural path of travel supports the compatibility with existing uses. The proposed use is therefore deemed appropriate.
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 uses would occur within a portion of an existing commercial building with negligible alterations within the strucure. No expansion of the existing building is proposed. Therefore, the project is categorically exempt from the CEQA, pursuant to CEQA Guidelines Section 15301 (Existing Facilities). Categorical Exemption under section 15301, Class 1 consists of the operation, repair, maintenance, permitting, leasing, licensing, or minor alteration of existing public or private structures, facilities, mechanical equipment, or topographical features, involving negligible or no expansion of existing or former use.
Waiver
The following location requirements apply to all retail storefront and retail non-storefront (delivery only) commercial cannabis businesses:
a. Located 300 feet or more, measured from the nearest property lines of each of the affected parcels, of any existing residential zone.
b. Located 600 feet or more, measured from the nearest property lines of each of the affected parcels, of any park, K-12 school, day care/ youth/ childcare center, child care, in-home (family day care home), religious facilities, and/or drug abuse, or alcohol recovery/treatment facility that is in existence at the time the land use permit is issued.
Location requirements may be waived or reduced through approval of a Waiver. SMC Section 16.80.195 provides that, “Waivers shall only be considered for unique situations where the literal application of the distance requirement is not reasonable. Waiver determinations will be made on a case-by-case basis.”
The applicant submitted neighborhood context information showing all required separation distances to determine whether the cannabis businesses conformed to each location requirement (Attachment D - Neighborhood Context Information). Staff has also reviewed the information and verified for accuracy. This includes consideration of uses not tracked in the City databases and a site visit to the surrounding area. Staff has provided geographic information to this report regarding currently approved commercial cannabis businesses for Retail Storefront businesses, and Non-storefront Retail (delivery only) businesses as a reference (Attachment E - Existing Retail Storefront Businesses and Non-storefront Retail (delivery only) Businesses).
The subject property is located approximately 574 feet from a parcel that contains a childcare center. All other location requirements are met. The childcare center is located southwest of the proposed project on the opposite (west) side of the I-5 freeway and only accessible via Grigsby Place (a side street). Staff recommended that due to the physical barrier of a major interstate highway coupled with the street separation and unique access to the childcare center that the intent behind the separation requirements is met notwithstanding the lack of 26 feet of technical separation. The actual “path of travel” between the two uses is over 1,500 feet and access to the childcare center is through a side street (Grisby Place) and is not directly accessed on Hammer Lane. This unique situation is exactly the type of unique circumstance the Code (via the waiver process) is designed to address.
Planning Commission Action
The proposed project was considered by the Planning Commission on December 10, 2020. During discussion, some members of the Planning Commission expressed concerns about the proposed cannabis business being located too close to the multi-family residential use to the northeast of the proposed location across Plymouth Road. Some Commissioners also expressed concern about the proximity of the proposed cannabis business to the aforementioned daycare center. The Commission also determined that the Interstate 5 (I-5) was not a significant or unique enough barrier to justify the approval of the waiver from location requirements which requires a distance of 600 feet from a childcare center, unless a waiver from the location requirement is approved.
The Planning Commission expressed concern about the proposed business adding to the criminal activity in the area. Crime statistics were provided by the Police Department that indicated the area had elevated calls for service. Definitive conclusions as to the reasons for the elevated calls for service were not established. The Police Department did not express opposition to the proposed project at this location.
Other concerns were expressed by some Commissioners regarding possible issues with to social distancing during the COVID-19 pandemic and insufficient parking spaces.
During the public comment period of the hearing, the applicant’s representative spoke in support of the project, outlining the experience of the operator. Community members were not in attendance and the Clerk did not receive any public comments in support or opposition of the project.
The Planning Commission denied the project by a vote of 4-3, with Commissioners Garcia, Rizvi, and Mallett dissenting (Attachment F - Resolution 2020-01-14-0302).
Applicant Appeal
On December 21, 2020, the applicant filed an appeal of the Planning Commission’s decision. The applicant alleged inadequate support for the Commission’s findings and requested reconsideration of the waiver based on the unique circumstances presented by the I-5 freeway and the fact that the project meets all other requirements, including parking standards set forth under the Code.
PUBLIC COMMENT
Notice for the City Council public hearing for this request was published in The Record on March 13, 2021, and mailed notice was sent to all property owners within a 300-foot radius at least ten days prior. As of the writing of this staff report, no written comments have been submitted.
FINANCIAL SUMMARY
Approval of the project would provide the City’s General Fund with additional revenue collected through the Cannabis Busines Tax which is currently 5% of revenue earned by the business.
Attachment A - Location Map
Attachment B - Appeal Request
Attachment C - Proposed Site Plan
Attachment D - Neighborhood Context Information
Attachment E - Existing Retail Storefront Businesses
Attachment F - Resolution 2021-01-14-0302