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APPEAL OF THE PLANNING COMMISSION’S DENIAL OF A USE PERMIT TO ESTABLISH A PROPOSED MEDICAL CANNABIS DISPENSARY IN AN INDUSTRIAL, GENERAL ZONE AT 2401 STAGECOACH RD
recommended action
RECOMMENDATION
Staff recommends that the City Council adopt a Resolution to approve the appeal and overturn the Planning Commission’s Denial of a Use Permit to allow the establishment of a proposed medical cannabis dispensary at 2401 Stagecoach Road, in accordance with the findings detailed herein.
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Summary
The City Council is asked to consider an appeal of the Planning Commission’s denial of a Use Permit to establish a medical cannabis dispensary in an existing building at 2401 Stagecoach Road (Attachment A - Appeal Letter). Under Stockton Municipal Code (SMC) 5.100.080, a maximum of four active operators permits for medical cannabis dispensaries and four active operators permits for medical cannabis cultivation sites may be issued citywide. Furthermore, the SMC defines land use and operational requirements and restrictions for medical cannabis businesses. Despite meeting all the SMC requirements and restrictions, the Use Permit application was denied by the Planning Commission. The Planning Commission discussed an unfair concentration of medical cannabis businesses would exist in South Stockton (council districts 5 and 6), and the resolution to approve the use permit failed on a 3-2 vote (two of the seven Commissioners were absent for this meeting).
Medical cannabis dispensaries are restricted to Industrial (IL, IG) and Commercial (CG, CL) Zones. Additionally, separation requirements from sensitive uses impose additional limitations on the available locations for medical cannabis dispensaries. Of the limited number of potential sites, there are few locations that are for sale or owners willing to lease to medical cannabis businesses. Most of the appropriately-zoned land for medical cannabis dispensaries is in central and South Stockton, which may lead to the placement of more medical cannabis businesses in these areas.
The applicant, Lafayette Street Property Management, submitted a Use Permit application to establish a proposed 6,000-square foot medical cannabis dispensary in an existing commercial building. The proposed site meets all minimum separation requirements between dispensaries and sensitive land uses as well as applicable provisions of Stockton Municipal Code (SMC) Section 16.80.195, Medical Cannabis Businesses - Permitting. In addition to a Use Permit, the applicant must also secure an Operators Permit from the Police Department before initiating the use. The Police Department reviewed the proposed security plan, and found that it meets Police Department Standards.
Therefore, staff recommended that the Planning Commission approve the application. Because the application still meets the requirements and restrictions outlined in the SMC, staff recommends Council adopt the proposed resolution based on the recommended findings of fact and conditions of approval. If this Use Permit is approved and all operators with approved Use Permits successfully obtain Operator Permits, the citywide limit of four medical cannabis dispensaries would be reached.
DISCUSSION
Background
On August 24, 2010, the City Council adopted ordinances to allow medical cannabis dispensaries in selected zoning districts and to regulate the operations and employee permit requirements for dispensaries. There are currently two (2) existing legal nonconforming cannabis dispensaries operating in the City (678 N. Wilson Way, Suite A-1 and 1550 W. Fremont Street) that were authorized under the provisions of these ordinances. On May 9, 2013, the Municipal Code was amended by the City Council to prohibit new medical cannabis dispensaries.
On June 28, 2016, the City Council approved placing two ballot measures on the November 8, 2016, General Election ballot that would, if approved by City voters, overturn the ban on medical cannabis dispensaries, allow medical cannabis dispensaries and cultivation businesses within the City (Measure P), and increase the business license tax on medical cannabis and related businesses (Measure Q). Both measures were approved by the voters during the General Election. More specifically, the measures amended SMC Chapters 5.10 (Medical Cannabis Businesses), 16.20 (Allowable Land Uses and Permit Requirements), 16.80 (Standards for Specific Land Uses), and 16.240 (Definitions/Glossary), resulting in the following changes to the Development Code (Title 16 of the SMC):
• Overturned the previous ban on medical cannabis dispensaries;
• Allows up to four (4) medical cannabis dispensaries in the CG, CL (Commercial, Large-Scale), IL (Industrial, Limited) and IG zones (Industrial, General) zones;
• Allows up to four (4) cultivation sites in the IL, IG, and PT (Port) zones;
• Imposes location restrictions for dispensaries and cultivation operations, including distances from sensitive locations;
• Requires a Planning Commission Use Permit, Operator’s Permit, and Workers Permits for all employees;
• Does not allow dispensary owners to own or operate cultivation sites within the City.
Present Situation
In January of 2017, the applicant submitted a Use Permit application to establish a proposed medical cannabis dispensary in an existing industrial building at the above-noted location. The 1.31-acre project site contains an existing 31,250-square foot commercial building that is occupied by an existing building materials company. The proposed 6,000-square foot dispensary will occupy the northwestern portion of the building. The applicant stated that the commercial building is currently vacant. He also stated that the remainder of the building would remain unoccupied, but a tenant could lease the space in the future.
The site is zoned IG and is bounded to the north, south, east, and west by various industrial uses (Attachment B - Location Map and Aerial Photograph).
The General Plan designates the project site for Industrial land uses. This land use designation and the accompanying IG zoning conditionally allow the proposed use, subject to securing an approved Use Permit from the Planning Commission.
The applicant indicated that all patients must demonstrate that they are California residents and provide written proof of their physician’s recommendation for medical cannabis use or a California State Medical Cannabis Identification Card before purchasing cannabis products. No one under the age of 18 will be permitted on premises. All products on the premises will be purchased from other vendors, and there will be no on-site manufacturing. The facility will hire at least 25 full-time employees, with 6-8 people on premises for day-to-day operations and is planned to be open seven days a week from 10:00 a.m. to 8:00 p.m. (Attachment C - Project Description).
Security Plan
Staff in the Police Department reviewed the facility’s proposed Security Plan. The proposed Security Plan meets the Police Department’s standards and includes provisions for on-site security personnel, access controls, video surveillance, and lighting. At least one security guard will be on site during all hours of operation, including one hour before and after the opening and closing of the business.
Location Restrictions
The following location restrictions apply to all medical cannabis dispensary sites and may not be waived or modified by the Use Permit or a Variance, Site Plan or Design Review application (SMC Section16.80.195.A.3):
a. No medical cannabis dispensary shall be established or located within 1,000 feet, measured from the nearest property lines of each of the affected parcels, of any other medical cannabis business or site having a valid use permit for a medical cannabis business;
b. No medical cannabis dispensary shall be established or located within 300 feet, measured from the nearest property lines of each of the affected parcels, of any existing residential zone;
c. No medical cannabis dispensary shall be established or located within 600 feet, measured from the nearest property lines of each of the affected parcels, of any childcare center, child care, in-home (family day care home), religious facilities, drug abuse, or alcohol recovery/treatment facility;
d. No medical cannabis dispensary shall be established or located within 1,000 feet, measured from the nearest property lines of each of the affected parcels, of any park or K-12 school.
As part of the Use Permit application, the applicant was required to submit exhibits (Attachment D - Neighborhood Context Maps) showing all required minimum separation areas to determine whether there are any sensitive uses in proximity to the subject site. Staff also conducted an analysis of the area using a City mapping system, which shows schools, parks, day care centers, and residential zones (Attachment E - Dispensary Map and Cannabis Businesses). For accuracy and to verify separation from sensitive land uses that are not tracked in the City database, staff also conducted a visit of the surrounding area and determined that the subject location meets all minimum separation requirements.
In accordance with SMC Section 5.100.080, no more than four (4) active Operators Permits for dispensaries are allowed in the City. As of this date, there are two (2) existing legal non-conforming dispensaries operating in the City (678 N. Wilson Way, Suite A-1 and 1550 W. Fremont Street). The Planning Commission approved a third use permit on July 13, 2017, for a dispensary at 7632 Pacific Avenue. If the Pacific Avenue dispensary successfully obtains the third Operators Permit, approval of the subject Use Permit could ultimately result in the issuance of a fourth dispensary Operators Permit in the City. The noted SMC section also allows a maximum of two (2) Operators Permits for dispensaries and two (2) Operators Permits for medical cannabis cultivation sites are allowed per City Council District. The subject site is located in Council District 5. There is currently one (1) legal non-conforming dispensary in Council District 5.
Parking and Access
Off-street parking for the existing and subject uses on the subject site is based on the Development Code’s parking requirements. Dispensaries are defined as a retail use for purposes of calculating parking requirements. The 6,000-square foot dispensary facility is required to have 24 parking spaces (one space per each 250 square feet of gross floor area (GFA). The remainder of the site’s 25,250 square feet would require up to 50 spaces depending on the use. The site has 22 existing parking spaces. In this circumstance, SMC section 16.64.050.F.ii states that additional parking shall be at the discretion of the director. Since the site is legal non-conforming with respect to the existing number of spaces and there are physical constraints on the site that would limit the number of spaces that could be provided, the director has deemed the existing number of spaces adequate for the retail business that would have 6-8 employees on site during business hours. However, future use of the vacant portion of the site may be limited to low intensity uses, unless additional parking could be provided.
Neighborhood Meeting
A community meeting was held on May 18, 2017. The meeting notice was mailed by the applicant to all property owners within a 300-foot radius of the subject property. Per the applicant, no one from the neighborhood attended the meeting (Attachment F - Community Meeting Notice).
Findings
The Development Code contains specific findings, all of which must be made in the affirmative to support the approval of a Use Permit. If one or more of the findings cannot be made, the Use Permit cannot be approved.
General Findings
There are seven General Findings in SMC Section 16.168.050.A that require compliance with all applicable provisions in the SMC; maintaining the integrity and character of the applicable zoning district; consistency with applicable General Plan objectives and policies; physical suitability of the site for the proposed use; not endangering or jeopardizing the public health, safety, peace, or general welfare of the public; compatibility with surrounding uses; and consistency with the California Environmental Quality Act.
As indicated in the Proposed Resolution, the subject use is allowed in the IG zone with an approved Use Permit and complies with applicable provisions of the Development Code. The subject use would be consistent with the Industrial land use designation of the General Plan and the site would be physically suitable for the proposed use, including the provision of utility services (e.g. sanitation and water), public access, and the absence of physical constraints (e.g. earth, movement, flooding, etc.). Further, the project would strengthen the integrity of the surrounding area, would not jeopardize or be hazardous to public peace and welfare, and would be compatible with surrounding land uses, because a dispensary is allowed in the IG zone and is consistent with the LU-5 Industrial Development portion of the General Plan.
Planning Commission Action
At the August 10, 2017 Planning Commission Hearing, the applicant spoke in support of the project, outlining the company vision, the safety features of the proposed site, and his experience in the cannabis industry.
During the public hearing, a member of the public spoke in favor of the proposed project communicating that the project will create jobs and generate tax revenue. A representative of the Stockton Patient Cooperative spoke in opposition of the project stating the cannabis businesses are overconcentrated in South Stockton, and the site is far removed from police services. An additional member of the public spoke in opposition to the project, raising concerns about the potential for this site to further strain police resources and pull them away from other areas of Stockton. One member of the public with neutral comments posed questions to staff about California State permitting requirements for medical vs recreational facilities.
Following the public testimony, members of the Planning Commission expressed concerns about the location of the proposed dispensary. Located in an industrial area, the site would be inconvenient to consumers having to navigate through industrial areas to make a purchase and stating that there is an unfair concentration of medical cannabis businesses located in South Stockton. A motion was made to pass the resolution and approve the use permit; however, because four affirmative votes are required to approve the request, the motion failed on a 3-2 vote (Don Aguillard and Elizabeth Hull absent).
Applicant Appeal
On August 21, 2017, the applicant filed an appeal of the Planning Commission’s decision, for various reasons. The City Council may uphold the Commission’s action and deny the appeal with a majority vote or override the Commission’s action with five concurring votes, in accordance with the provisions of SMC Section 16.100.040.G.1.
Environmental Clearance
The subject project is exempt from the provisions of the California Environmental Quality Act (CEQA) per CEQA Guidelines Section 15301, Class 1, as the use of an existing facility.
FINANCIAL SUMMARY
There is no anticipated financial impact to the City as a result of the current item.
Attachment A - Appeal Letter
Attachment B - Location Map and Aerial Photograph
Attachment C - Project Description
Attachment D - Neighborhood Context Maps
Attachment E - Dispensary Map and Cannabis Businesses
Attachment F - Community Meeting Notice