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APPEAL OF THE PLANNING COMMISSION’S APPROVAL OF A USE PERMIT TO ESTABLISH A MEDICAL CANNABIS DISPENSARY IN AN EXISTING BUILDING AT 3706 EAST HAMMER LANE, SUITE 6
recommended action
RECOMMENDATION
Staff recommends that the City Council adopt a Resolution to deny the appeal and uphold the Planning Commission’s approval of a Use Permit to allow the establishment of a proposed medical cannabis dispensary at 3706 East Hammer Lane, Suite 6 (P17-0262), in accordance with the findings detailed herein.
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Summary
This matter was originally scheduled for December 5, 2017. At that meeting, it was continued to February 27, 2018 on the recommendation of the City Attorney in connection with a related ltigation matter. The City Council is asked to consider an appeal of the Planning Commission’s approval of a Use Permit to allow the establishment of a medical cannabis dispensary at 3706 East Hammer Lane, Suite 6 (Attachment A - Appeal Letter). The applicant, David Draper Jr., submitted a Use Permit application with all required application materials (floor plan, site plan, neighborhood context map, security and lighting plan, and operation overview) to establish a proposed 3,500-square foot medical cannabis dispensary in an existing commercial building at the southwest corner of Hammer Lane and Sampson Road. The site meets all minimum separation requirements between dispensaries, and sensitive land uses in accordance with Stockton Municipal Code (SMC) Section 16.80.195, Medical Cannabis Businesses.
At the time Measure P was passed by the voters, two pre-existing legally-permitted medical cannabis dispensaries were in Stockton, leaving the potential for two additional dispensary Operators Permits in accordance with SMC 5.100.080. Following the approval of Measure P, three valid Use Permit applications for medical cannabis dispensaries have been received. The order in which Use Permit applications are received is important in that it determines the order in which Operators’ Permit applications will be evaluated and either denied or approved by the Chief of Police in accordance with Chapter 5.100.
The first dispensary application (7632 Pacific Avenue) was approved by the Planning Commission on July 13, 2017. The second dispensary application (2401 Stagecoach Road) was denied by the Planning Commission on August 10, 2017. That decision was appealed to the City Council and on October 17, 2017, the Council voted to overturn the Planning Commission decision (4-2). Pursuant to Stockton Municipal Code (SMC) 16.100.040.G.1, a supermajority vote is required to overturn a Planning Commission decision and the motion failed. Later, it was determined that the Charter, which requires only a majority vote to pass resolutions, superseded the Code’s supermajority requirement and the motion passed.
The application that is the subject of this appeal is the third Use Permit application received since the passage of Measure P and the fifth in line for both a Use Permit and Operators Permit. For the purposes of this appeal, the City may take action on the fifth use permit application (3706 E. Hammer Lane) following its normal process. However, if approved, the applicant must wait to see whether the Stagecoach applicant is able to obtain an Operators Permit and only if Stagecoach is ultimately unsuccessful, may the 3706 Hammer Lane applicant move forward with the administrative process and try and obtain an Operators Permit. The applicant was informed of the noted process.
Staff recommends that Council adopt a Resolution denying the appeal and upholding the Planning Commission’s approval of a Use Permit for the proposed medical cannabis dispensary at 3706 East Hammer Lane, Suite 6 in accordance with the findings detailed herein.
DISCUSSION
Background
On August 24, 2010, the City Council adopted ordinances which allowed medical cannabis dispensaries in selected zoning districts and regulated 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;
• Imposed location restrictions for dispensaries and cultivation operations, including distances from sensitive locations;
• Required a Planning Commission Use Permit, Operator’s Permit, and Workers Permits for all employees;
• Prohibited dispensary owners from owning or operating cultivation sites within the City;
The 1.02-acre project site, which is in an integrated shopping center at the southwest corner of Hammer Lane and Sampson Road, contains an existing 9,960-square foot commercial building that is occupied by multiple tenants. The subject facility will occupy the eastern end of the building. The site is zoned CG and is bounded to the:
• north across Hammer Lane by retail uses and a fast-food restaurant zoned CG; and
• east, south, and west by various retail/office uses and a parking lot in an existing shopping center zoned CG (Attachment B - Location Map and Aerial Photography).
The General Plan designates the project site for Commercial land uses. This land use designation and the accompanying CG zoning conditionally allow the proposed use, subject to securing an approved Use Permit from the Planning Commission.
Present Situation
In April of 2017, the applicant submitted a Use Permit application to allow the establishment of a medical cannabis dispensary in an existing commercial building at the above-noted location. Per SMC Section 16.20.020, Table 2-2, Allowable Land Uses and Permit Requirements, a Use Permit is required for the subject use.
Consistent with state law, 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 nine (9) full-time employees and is planned to be open seven days a week from 10:00 a.m. to 8:00 p.m. The entrance to the dispensary will be monitored by security cameras installed inside and outside of the building. In addition, there will be two security guards at the facility. One security guard will strictly control access to and from the facility during business hours. Another one will patrol the inside of the premise and parking lot (Attachment C - Operation Overview).
Security Plan
Staff in the Police Department reviewed the required Security Plan for the subject facility. The proposed Security Plan meets the Police Department’s standards and includes provisions for on-site security personnel, access controls, video surveillance, and lighting. Two security guards 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.
The SMC includes additional requirements and restrictions as specified below:
1. Conditional Use Permit required - a Conditional Use Permit is required to establish or operate a medical cannabis dispensary.
2. Operator Permit Required - after acquiring a Conditional Use Permit, a medical cannabis dispensary must obtain and maintain at all times a valid medical cannabis Operator Permit as required by Chapter 5.100.
3. Maximum of two (2) dispensaries and two (2) cultivation sites in operation within any Council District; maximum of four (4) medical cannabis dispensaries citywide pursuant to SMC section 5.100.080.
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 has also analyzed the area using a City mapping system, which shows schools, parks, day care centers, and residential zones (Attachment E - Map for Medical Cannabis Dispensary Businesses). For accuracy and to verify separation from sensitive land uses that are not tracked in the City database, staff conducted a site visit of the surrounding area and determined that the subject location meets all minimum separation requirements.
Limit on Dispensaries
As mentioned above, an operator needs both a Use Permit and an Operators Permit to operate a medical cannabis dispensary in the City of Stockton. While there is no limit on the number of Use Permits available for approval, SMC Section 5.100.080 limits the number of available Operators Permits to four (4). Consequently, there can only be 4 operating dispensaries in the City at any given time. 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) leaving just two dispensary Operators Permits available for approval.
Following the approval of Measure P, three valid Use Permit applications for medical cannabis dispensaries were received. The first dispensary Use Permit application (7632 Pacific Avenue) was approved on July 13, 2017. The second dispensary application (2401 Stagecoach Road) (“Stagecoach”) was denied by the Planning Commission on August 10, 2017. Subsequently, Stagecoach filed an appeal to the City Council which was heard on October 17, 2017. At that meeting, Council voted to overturn the Planning Commission decision (4-2); however, pursuant to SMC section 16.100.040.G.1, a supermajority vote is required to overturn a Planning Commission decision and the motion failed. Later, it was determined that the Charter, which requires only a majority vote to pass resolutions, superseded the Code’s supermajority requirement and the motion passed.
The order Use Permit applications are received is important because it determines the order in which Operators Permit applications will be evaluated and either denied or approved by the Chief of Police. Consequently, when Council overturned the Commission’s decision and approved the Use Permit for the Stagecoach location, the Stagecoach applicant was free to move forward in the administrative process and try and obtain an Operators Permit.
For the purposes of this appeal, the City may take action on the fifth use permit application (3706 E. Hammer Lane) following its normal process. However, if approved, the applicant must wait to see whether the Stagecoach applicant is able to obtain an Operators Permit and only if Stagecoach is ultimately unsuccessful, may the 3706 Hammer Lane applicant move forward with the administrative process and try and obtain an Operators Permit. The applicant was informed of the noted process.
The decision before the Council is a land use decision which is heard “De Novo,” which means the Council can exercise its own independent judgment as to whether or not the Commission’s decision should stand. The appeal is reviewed against the criteria identified in the Stockton Municipal Code 16.80.195 and the recommended findings for the use permit contained in the Resolution. The subject dispensary request is located in Council District 2. There are no permitted dispensaries in Council District 2.
Parking and Access
With respect to parking, off-street parking for the existing and proposed 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 3,500-square foot dispensary facility is required to have 14 parking spaces (one space per each 250 square feet of gross floor area (GFA)). The overall 50 existing parking spaces on the subject site are adequate to meet the off-street parking requirements for both the subject dispensary and other uses in the commercial building. Access to the subject site is provided by existing common driveways from Holman Road, Sampson Road and Telstar Place that also serve the integrated shopping center.
Neighborhood Meeting
A community meeting was held on August 15, 2017. The meeting notice was mailed by the applicant to all property owners within a 300-foot radius of the subject property. (Attachment F - Community Meeting Notice). The applicant, two business partners and staff attended the meeting; however, no one from the neighborhood attended the meeting. A letter from the owner of the property at 3714 E. Hammer Lane was received. He raised questions regarding the status of the application, the restrictions and regulations of the subject use, the medical cannabis usage in the public places, an increase of police patrol in the area, the statistics of increased crimes or other negative community impacts, and any subsequent review if the noted Use Permit is granted (Attachment G - Neighborhood Letter).
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 CG zone with an approved Use Permit and complies with applicable provisions of the Development Code. The subject use would be consistent with the Commercial 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 it is considered a similar retail use to other retail uses in the shopping center and the surrounding area.
Planning Commission Review
At the September 14, 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, members of the Planning Commission raised questions regarding the use of the restroom, the on-site security guards and the location of license plate recognition cameras at the subject site. The applicant responded that the restroom located at the back of the premise would not be provided for the public use; however, he would allow disabled customers to use it for emergency purposes. In such an instance, a security guard would assist the customer and stay outside of the restroom. With respect to the on-site security guards, the applicant stated that he would plan to have two security guards on the site during the business hours, including a one-half hour before and after the businesses open and close. After the business is closed, security patrols from the security company would monitor the subject facility throughout the night and respond to all alarms. Further, the license plate recognition cameras would be installed on the top of the roof to monitor all vehicles in and out the facility.
Following public testimony, a motion was made to continue the public hearing to October 26, 2017, until the outcome of the pending Use Permit application at 2401 Stagecoach Road was known. Several commissioners expressed their view that a decision for approval or denial of the noted Use Permit should be based on land use regulations. The same commissioners went on to state that if the subject use complied with all applicable development standards, the Commission should approve or deny the noted Use Permit. The Deputy City Attorney made a similar comment to the Planning Commission. As a result, the motion to continue the public hearing to October 26, 2017, was rescinded. A subsequent motion was made to approve the Use Permit for the establishment of a medical cannabis dispensary at 3706 East Hammer Lane, Suite 6. The motion passed on a 4-2 vote (D’Adrea Davie and Kimberly A. Warmsley dissenting).
Appeal
On September 25, 2017, Gabriel M. Contreras filed an appeal of the Planning Commission’s decision for various reasons, including the applicant’s qualifications and proximity to an existing liquor store and smoke shop
Environmental Clearance
The subject project is expected to comply with applicable provisions of the California Environmental Quality Act (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 this action.
Attachment A - Appeal Letter
Attachment B - Location Map and Aerial Photography
Attachment C - Operation Overview
Attachment D - Neighborhood Context Maps
Attachment E - Map of Medical Cannabis Business
Attachment F - Community Meeting Notice
Attachment G - Neighborhood Letter