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APPEAL OF THE PLANNING COMMISSION DENIAL OF A COMMISSION USE PERMIT AND DESIGN REVIEW TO ESTABLISH A RETAIL STOREFRONT CANNABIS BUSINESS AND AN ADMINISTRATIVE USE PERMIT TO ESTABLISH A RETAIL NON-STOREFRONT (DELIVERY ONLY) CANNABIS BUSINESS, IN AN EXISTING 4,375 SQUARE FOOT COMMERCIAL BUILDING AT 2521 WEST LANE (APPLICATION NO. P21-0602)
recommended action
RECOMMENDATION
It is recommended that 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 retailer storefront cannabis business, in accordance with the findings and subject to conditions in the proposed Resolution; and
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 conditions in the proposed Resolution; and
3. Reverse the Planning Commission’s denial of Design Review for architectural modifications to an existing building, in accordance with the findings and subject to conditions in the proposed Resolution.
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Summary
The applicant, Caroline Johnson, submitted a Commission Use Permit (CUP), Administrative Use Permit (AUP), and Design Review application to establish a 4,375-square foot cannabis retail storefront business and a retail non-storefront (delivery only) cannabis business in a Commercial, General (CG) zoned parcel, located at 2521 West Lane. The proposed business would occupy a vacant building that previously housed an automotive repair shop (Attachment A - Location Map).
The applicant participated in and won the 2021 Commercial Cannabis Lottery program and was awarded the opportunity to apply for the one (1) annual general pool Cannabis Retail Storefront CUP. If approved and prior to the issuance of the Cannabis Operators Permit, the applicant will need to submit a security plan for the proposed cannabis business for review and approval by the Police Department, as required by Stockton Municipal Code (SMC) 5.100.050 (Application for Cannabis Operators Permit). The Stockton Police Department has reviewed the application and indicates no opposition to this proposed project.
On April 14, 2022, the Planning Commission held a public hearing to consider the project application. There were no members of the public in attendance to speak on the project, however one (1) electronic communication from Aspire Public Schools was submitted to the Planning Commission the night of the meeting requesting a continuance (Attachment B). The Planning Commission opted to open the public hearing and receive staff and applicant presentations and then discussed the project. Staff indicated that the project satisfied all location requirements, including the minimum 600’ distance from any school, with no waivers required, and the project satisfied all findings for approval. For clarity, the Project property is located slightly more than 1,200 feet away from the Aspire Public Schools property. After discussion, the Planning Commission unanimously agreed to continue the hearing item to the next scheduled Planning Commission meeting, to allow opportunity for Aspire School to participate in the public hearing process. The Planning Commission advised the applicant to reach out to the school contact identified on the communication prior to the next meeting.
On April 28, 2022, the Planning Commission continued discussion during the public hearing on the project. The applicant relayed to the Commission that they made multiple attempts to reach out to Aspire Public Schools, however, were unsuccessful in scheduling a meeting with them until the day following the Planning Commission meeting. There was no Aspire Public Schools representative in attendance at the meeting, however, an electronic communication was submitted by the school expressing concerns with the Project (Attachment B). The Commission attempted a vote for approval of the project that failed due to a 3-3 vote result (Commissioner Rizvi absent). Subsequently, the Commission attempted a vote to continue the item to the next meeting when the full commission could be available to vote, however, that vote failed due to a 3-3 vote result. Due to a lack of a majority vote, the project was summarily denied.
On May 10, 2022, the applicant filed an appeal to the City Council requesting reconsideration of the Planning Commission’s denial, on the basis that the school did not make themselves available and the Commissioner tie vote.
As reflected in staff’s analysis below, the Project will comply with all applicable provisions of the Stockton Municipal Code, and exceeds the minimum location requirements oulined in SMC Section 16.80.195 which requires separation from sensitive uses (i.e. residential zones, parks, schools, etc.). The Project would strengthen the integrity of the surrounding area by locating its operation within a vacant portion of an existing building, provide new employment opportunities and generate additional tax revenue for the City General Fund. Therefore, staff recommends the City Council reverse the Planning Commission’s April 28, 2022, denial of the proposed Commission Use Permit and Design Review and approve the Project, subject to the findings and conditions of approval.
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 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 Stockton Municipal Code (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 was established. A controlled expansion program allows the City and the existing industry to adapt to an evolving industry 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:
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 (2) 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. 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 an 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.
The applicant of the proposed project was awarded the opportunity to apply for a cannabis retail storefront in the 2021 Commercial Cannabis Lottery. The Non-storefront Retail (delivery only) use applicability is not granted through the Commercial Cannabis Lottery program. Per SMC Section 5.100.080, there is a Citywide cap of fourteen (14) active operators permits for Retail Operators - Storefront commercial cannabis business types. As of the writing of this staff report, there are a total of seven (7) approved Retail Operators, although only five (5) are open for business.
On March 1, 2022, the Council approved changes to the Cannabis Regulatory Program via an Ordinance amendment. It is important to note that those new regulations do not apply to this application as its deemed complete date predates the Ordinance’s effective date of March 31, 2022.
Project Description
The applicant requests approval to operate an approximate 4,375 square foot cannabis retail storefront business and delivery service at 2521 West Lane within a Commercial, General (CG) Zone. The proposed business includes 1,147 square feet of retail storefront with the remaining 3,228 square feet for all other delivery operations, back of house, and storage.
The proposed project is located in the East Stockton neighborhood, across from the Stockton El Pinal Industrial Park subdivision. The neighborhood is mainly composed of Industrial Limited and Industrial General zones. The surrounding uses include an automobile collision facility to the north; a tile and stone delivery facility to the east; a recycling facility to the south; and railroad tracks directly to the west.
Per SMC Section 16.20.020(A)(3) (Allowable land uses and permit requirements - Multiple Uses on a Single Site), sites where a proposed project includes multiple land uses, and more than one type of land use permit is required, the most restrictive land use permit shall apply for all land uses. The applicant has applied for a Commission Use Permit to establish a cannabis retail storefront and an Administrative Use Permit for cannabis non-storefront retail delivery, all within the same building; per SMC 16.20.020, the Commission Use Permit will be applied for both land uses. A Design Review application was also submitted for exterior changes to the existing building.
The proposed hours of operation for the retail storefront portion of the business are daily from 8:00 a.m. to 8:00 p.m. and 8:00 a.m. and 7:00 p.m. Monday through Friday for the non-storefront retail delivery service are. The applicant plans to employ approximately 50 full-time employees, plus on-site security 24-hours a day.
The Stockton Police Department has reviewed the application and indicates no opposition to this proposed project. If approved, a formal security plan and lighting plan will be submitted and reviewed by the Police Department as part of an Operators Permit application.
ANALYSIS
The applicant is requesting that the City Council consider reversing the Planning Commission’s denial, thereby approving the Commission Use Permit. The City Council may uphold the Commission’s actions and deny the project, or reverse the Commission’s action with four (4) concurring votes (a majority vote), in accordance with SMC Section 16.100.040(G)(1). Staff recommends that Council consider reversing the Plannign Commission’s denial and uphold staff’s recommendation for approval of the Commission Use Permit and Design Review.
To permit the proposed uses, the City Council is asked to consider approval of a Commission Use Permit, Administrative Use Permit and Design Review request. Each request and staff’s analysis are provided below.
Commission Use Permit/Administrative Use Permit
When located in an 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.
Security and Lighting
Per SMC 5.100.050, if the proposed cannabis business 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. The security and lighting plan will be reviewed annually by the Police Department to help ensure safe operations. All cannabis operations for the proposed cannabis business will occur indoors. Appropriate security provisions will be incorporated into the formal security plan and lighting plan, including on-site security. Furthermore, to maximize security and safe practices for cannabis businesses, the Department of Cannabis Control oversees all cannabis retailers in California and regulates cannabis retailers to ensure safe practices. 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.
Parking
Per Table 3-9 of SMC 16.64.040, cannabis retailers, both storefront and non-storefront, are required to provide one (1) parking space for every 250 square feet of floor area for the retail portion of the business and a ratio of one (1) space for every 2,000 square feet of storage, employee break rooms, equipment rooms, offices, and circulation corridors. Based on this ratio, the proposed business is required to provide eight (8) parking spaces, based on a ratio of one (1) space for every 250 square feet of floor area for the retail portion of the business and a ratio of one (1) space for every 2,000 square feet of storage, employee break rooms, equipment rooms, offices, and circulation corridors. The business will provide 27 on-site parking spaces -14 for customers and 13 for staff, which exceeds the Code requirement of 8 spaces.
|
Land Use |
Tenant |
Sq. Ft. |
Parking (Spaces) |
|
Commercial, General |
Cannabis Retailer |
4,375 |
27 |
|
Total Parking Required by Code |
8 |
|
Vehicle Parking Surplus |
19 |
|
Adequate Vehicle Parking Provided? |
Yes |
Commission Use Permit/Administrative Use Permit Findings
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 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 not raise questions of conformance with Title 16 development standards. Per SMC Section 16.20.020(A)(3) (Allowable land uses and permit requirements - Multiple Uses on a Single Site) sites where a proposed project includes multiple land uses, and more than one type of land use permit is required, the most restrictive land use permit shall apply for all land uses. Therefore, the applicant is requesting approval for a Commission Use Permit to establish a Cannabis Retail Storefront and retail non-storefront delivery use in accordance with the SMC. As conditioned, the cannabis uses will be in conformance with the development standards outlined in Title 16 of the Municipal Code.
As noted above, adequate off-street parking spaces are provided for both proposed uses.
The proposed project is also subject to and meets the location requirements set forth in SMC 16.80.195(A)(6) and 16.80.195(B)(4). 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 retailer and delivery service would be situated in a vacant portion of a building that formerly housed an automotive repair facility, situated near several other commercial and industrial uses; away from sensitive land 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 uses 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 Commercial. The Commercial designation is intended to accommodate a wide variety of commercial uses, including, but not limited to, retail, personal and business services, commercial recreational uses, and a mix of office, commercial and/or residential uses. The proposed use is a cannabis retail storefront and delivery business where cannabis products will be sold on-site and delivered off-site to consumers. All of which are consistent with the uses described in the General Plan for the Commercial land use designation. The zoning district (CG) is also consistent with the City’s General Plan Commercial land use designation for the project site. Therefore, the proposed use is consistent with the commercial designation.
Additionally, the project is consistent with the following General Plan 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.
The proposed use furthers the above goals 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 proposed project would occupy an existing vacant commercial building within a commercial area. 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. Further, The proposed project was reviewed for compliance with all applicable and current Building Code guidelines and found to be in complance given the nature of the proposed project. No exapansion of the building is proposed. The site will have access to City utility services.
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 Retailer 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 on-site security personnel.
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 Retailer Storefront and Non-Storefront Retail (delivery only) is located in an existing and vacant commercial building in a commercial zone near automobile repair facilities and a recycling facility. The proposed use raises no potential issues related to compatiblity with the existing and future land uses on-site and in the vacinity 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 uses would occur within an existing commercial building. Thefore, the project is categorically exempt from the CEQA, pursuant to CEQA Guidelines section 15301 (Existing Facilities). A categorial 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.
As a point of reference, Staff attached a location map of currently approved commercial cannabis businesses to this report (Attachment C - Existing Commercial Cannabis Businesses). However, the distance between cannabis businesses is not regulated by the SMC that applies to this application. Therefore, the proposed Retailer Storefront and Non-storefront Retail (delivery only) businesses are permitted to be in the same location.
Design Review
SMC Section 16.120.020(A)(2) requires prior Design Review approval for additions and exterior remodeling of existing commercial development throughout the City that is visible from a public right-of-way or an internal circulation route. The merits of Design Review requests are weighed against their ability to conform to the Citywide Design Guidelines. For this Project, Section 4.01 (General Commercial Design Guidelines) provides the relevant reference point for the City's expectations for quality development.
The Stockton Citywide Design Guidelines establish criteria for general site planning and architectural guidelines to encourage the highest level of design quality and creativity. The proposed architecture consists of painting the exterior of the building and infilling the existing roll-up doors with glazing to match other exterior windows. Site improvements, including new chain link and wrought iron fencing, sliding entry gate, and landscaping, are consistent with the Development Code and compatible with other commercial uses in the area. (Attachment D - Project Plans)
On March 15, 2022, the Director reviewed the Project for conformance with the Citywide Design Guidelines and recommended approval, as proposed. The Director’s recommendation and approval findings for City Council consideration are presented in the Proposed Resolution.
Environmental Clearance
The proposed project is categorically exempt from CEQA, pursuant to CEQA Guidelines section 15301(a) (Existing Facilities) since the project will occupy an existing facility and no expansion of building or site is proposed.
Planning Commission
On April 14, 2022, the Stockton Planning Commission conducted a duly noticed hearing and considered the staff report and presentation, as well as a presentation from the applicant. There were no members of the public in attendance at the public hearing. Anthony Solina, Area Superintendent of Aspire Public Schools, submitted an electronic communication in the late afternoon to the Planning Commissioners requesting a continuance of the item so they could gather more details and understand the impact of having the business near the school. There were no additional public comments or emails submitted.
The Planning Commission discussed the item, indicating mostly support for the project, however voted 5-1 (Garcia absent) to continue the item to the next Planning Commission meeting on April 28, 2022, so the applicant could discuss their project with Aspire Public Schools representatives.
On April 28, 2022, the Stockton Planning Commission continued public hearing discussion and considered the staff report and brief presentation recapping the previous meeting. The applicant was asked if they had an opportunity to meet with Aspire Schools prior to the meeting. The applicant expressed that they made multiple attempts to contact the school to arrange meeting but were unable to schedule a meeting until the day following the Planning Commission Meeting. There were no members of the public present at the Planning Commission hearing. Anthony Solina, Area Superintendent of Aspire Public Schools, submitted an electronic communication to the Planning Commission stating the school’s position on the project, and their intent to appeal an approval decision of the Planning Commission. The Planning Commission voted to approve the project that failed due to a 3-3 vote result (Rizvi absent). Subsequently, the Planning Commission voted to continue the item to the next meeting when all Planning Commissioners could be present, that also failed due to a 3-3 vote result. Since a majority vote was unable to be reached, the Project was summarily denied as a result.
Applicant Appeal
On May 10, 2022, the applicant filed an appeal of the Planning Commission’s denial of the project, citing their conformity with the process, attempts to contact Aspire Schools, support for the project from the Planning Commissioners mentioned at the April 14, 2022, public hearing and tie vote (Attachment E - Applicant Appeal).
PUBLIC COMMENT
Notice for this item was published in The Record on September 16, 2022, and a notice was sent to all property owners within a 300-foot radius of 2521 West Lane (APN 117-090-32). No written comments have been submitted from the time of the appeal to the preparing of this staff report.
FINANCIAL SUMMARY
Approval of the project would provide the City’s General Fund with additional revenue collected through the Cannabis Business Tax which is currently 5% of revenue earned by the business.
Attachment A - Location Map, General Plan and Zoning Designation
Attachment B - Communication from Aspire Public Schools
Attachment C - Existing Commercial Cannabis Businesses
Attachment D - Project Plans
Attachment E - Applicant Appeal