HomeMy WebLinkAbout06 - CC-5 - Second Reading and Adoption of an Ordina - 5/4/20211
CITY COUNCIL AGENDA REPORT
MEETING DATE: MAY 4, 2021 ITEM NUMBER: CC-5
SUBJECT: SECOND READING AND ADOPTION OF AN ORDINANCE TO ADOPT
CODE AMENDMENT CO-2021-01 TO AMEND TITLE 13 (PLANNING,
ZONING, AND DEVELOPMENT) AND AN ORDINANCE TO AMEND
TITLE 9 (LICENSES AND BUSINESS REGULATIONS) OF THE COSTA
MESA MUNICIPAL CODE REGARDING THE TAXATION, REGULATION,
OPERATING REQUIREMENTS AND STANDARDS FOR CANNABIS
USES INCLUDING RETAIL CANNABIS STOREFRONT AND NON-
STOREFRONT USES TO IMPLEMENT THE CITY OF COSTA MESA
RETAIL CANNABIS TAX AND REGULATION MEASURE (MEASURE Q)
DATE: APRIL 26, 2021
FROM: DEVELOPMENT SERVICES DEPARTMENT/PLANNING DIVISION
PRESENTATION BY: NANCY HUYNH, SENIOR PLANNER
FOR FURTHER INFORMATION CONTACT: NANCY HUYNH (714) 754-5609
nancy.huynh@costamesaca.gov
RECOMMENDATION:
Give second reading to and adopt:
Ordinance No. 2021-08 to adopt Zoning Code Amendment CO-2021-01 amending
Title 13, Chapter IX, Article 21 and Chapter IV, Table 13-30 of the Costa Mesa
Municipal Code; and
Ordinance No. 2021-09 to amend Title 9, Chapter I, Article 5, Chapter II, Article 1,
and Chapter VI of the Costa Mesa Municipal Code regarding the taxation and
regulation for retail cannabis uses including storefronts and non-storefronts.
ANALYSIS:
At its regular meeting of April 20, 2021, the City Council gave first reading to and introduced
Ordinance No. 2021-08 and Ordinance No. 2021-09 by a 5-2 vote (Councilmembers
Harper and Reynolds voting no).
The Ordinances amend both Title 9 and Title 13 of the Costa Mesa Municipal Code. Title
13 (Zoning Code) is amended to update the land use matrix and add a new code section
which establishes the zoning, location, and permitting requirements as well as
development standards for retail cannabis storefronts and non-storefronts. Title 9 is
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amended to establish the retail cannabis tax rate and operating requirements for retail
cannabis uses.
As part of its motion approving the first reading and introduction of the Ordinances, the City
Council articulated requested changes to the Ordinances. Those changes are reflected in
the final Ordinances (Attachment 1 and 2). and are also provided in in
underline/strikethrough format in Attachments 3 and 4 to this agenda report.
The agenda report and video for the April 20, 2021 City Council meeting can be found at
the following links:
Agenda Report: http://ftp.costamesaca.gov/costamesaca/council/agenda/2021/2021-04-
20/PH-1.pdf
Video: https://costamesa.granicus.com/player/clip/3705?view_id=10&redirect=true
If approved, the Ordinances would become effective 30 days after the second reading.
PUBLIC NOTICE:
Pursuant to Government Code 36933, a summary of the proposed Ordinances was
published once in the newspaper no less than 5 days prior to the May 4, 2021 second
reading. A summary of adopted ordinances will be published within 15 days after the
adoption.
As of this report, no additional written public comments have been received. Any additional
written comments received will be forwarded under separate cover.
ALTERNATIVES:
The City Council may give second reading and adopt the Ordinances as proposed, modify
the Ordinances, or not adopt the Ordinances. If the City Council chooses to make
substantive modifications to one or both of the Ordinances after introduction, the modified
Ordinance(s) would need to be brought back at a future meeting for second reading and
adoption.
FISCAL REVIEW:
Fiscal impacts were discussed in detail in the April 20, 2021 City Council agenda report.
LEGAL REVIEW:
The subject Code Amendment has been prepared by the City Attorney’s Office.
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CITY COUNCIL GOALS & PRIORITIES:
Achieve long-term fiscal sustainability.
CONCLUSION:
Staff recommends that the City Council give second reading to and adopt Ordinance No.
2021-08 (Code Amendment CO-2021-01) and Ordinance No. 2021-09. The adoption of the
proposed Ordinances would establish a process for the City to regulate, review, and tax
cannabis retail businesses pursuant to Measure Q. If approved, the Ordinances would
become effective 30 days after the second reading by City Council.
________________________________ _________________________________
NANCY HUYNH JENNIFER LE
Senior Planner Director of Economic and Development
Services
________________________________ _________________________________
CAROL MOLINA KIMBERLY HALL BARLOW
Finance Director City Attorney
Attachments: 1. Ordinance No. 2021-08 (Title 13)
2. Ordinance No. 2021-09 (Title 9)
3. Title 13 Revisions in underline/strikethrough
4. Title 9 Revisions in underline/strikethrough
ORDINANCE NO. 2021-08
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF COSTA
MESA AMENDING CHAPTER IX (SPECIAL LAND USE REGULATIONS),
ARTICLE 21 (LOCATION OF MARIJUANA DISTRIBUTING,
MANUFACTURING, RESEARCH AND DEVELOPMENT AND TESTING
LABORATORIES), AND CHAPTER IV (CITYWIDE LAND USE MATRIX),
TABLE 13-30 (LAND USE MATRIX) OF TITLE 13 (CODE AMENDMENT
CO-2021-01) TO ESTABLISH THE DEVELOPMENT STANDARDS FOR
CANNABIS USES, INCLUDING RETAIL CANNABIS STOREFRONT
AND NON-STOREFRONT USES TO IMPLEMENT THE CITY OF COSTA
MESA RETAIL CANNABIS TAX AND REGULATION MEASURE
(MEASURE Q)
THE CITY COUNCIL OF THE CITY OF COSTA MESA DOES HEREBY ORDAIN AS
FOLLOWS:
WHEREAS, on July 21, 2020, the City Council voted to place a ballot measure for
the 2020 General Election asking city voters whether or not to allow retail cannabis
storefront (dispensaries) and non-storefront (deliveries) businesses in the City;
WHEREAS, on November 3, 2020, city voters approved the “City of Costa Mesa
Retail Cannabis Tax and Regulation Measure”, also known as, Measure Q;
WHEREAS, Measure Q authorizes the City Council to adopt an ordinance which
permits and regulates retail cannabis storefront (dispensaries) and non-storefront
(deliveries) businesses;
WHEREAS, Measure Q authorizes the City Council to impose a four-percent (4%) to
seven-percent (7%) gross receipts tax on retail cannabis businesses. In addition, Measure
Q requires retail cannabis businesses to meet certain operating requirements including
permitted zones, minimum of 1,000 feet separation distance from sensitive uses such as
schools, childcare centers, playgrounds and homeless shelters, security measures, and a
requirement for a labor peace agreement for businesses with two or more employees;
WHEREAS, a Zoning Code Amendment is necessary to implement Measure Q
and establish the minimum operating requirements and development standards in the
Costa Mesa Municipal Code to tax, review, and regulate retail cannabis storefront and
non-storefront businesses operating in the City;
Attachment 1
WHEREAS, Chapter IX (Special Land Use Regulations), Article 21 (Location of
Marijuana Distributing, Manufacturing, Research and Development and Testing
Laboratories), Section 13-200.92 of Title 13 (Planning, Zoning and Development)
contains permitted zones and planning application requirements for cannabis distribution,
manufacturing, research and development, and testing laboratory uses. Chapter IV
(Citywide Land Use Matrix), Table 13-30 (Land Use Matrix) of Title 13 prohibits retail
cannabis sales;
WHEREAS, the proposed amendments to Chapter IX, Article 21 would add inter
alia a new section, Section 13-200.93, to establish the permitted zones, planning
application requirements, separation requirements from sensitive uses, and specific
development standards for retail cannabis uses. The proposed amendment to Table 13-
30 (Land Use Matrix) would revise cannabis retail sales from prohibited to conditionally
permitted with an MCUP as well as add a land use category for cannabis retail sales non-
storefront;
WHEREAS, the Title 13, “Planning, Zoning and Development”, (the Zoning Code)
of the Costa Mesa Municipal Code sets forth the zoning and land use regulations for the
City in general; and,
WHEREAS, the City Council held a public hearing on April 20, 2021 with all
persons having the opportunity to speak for and against the proposal; and,
WHEREAS, the Zoning Code Amendment and Ordinance No. 2021-08 have been
reviewed for compliance with the California Environmental Quality Act (CEQA), the CEQA
guidelines, and the City’s environmental procedures. The Code Amendment has been
found to be exempt pursuant to CEQA Guidelines Section 15061(b)(3) (General Rule)
and Section 15308 (Class 8, Actions by Regulatory Agencies for the Protection of the
Environment) because the recommended ordinance will not have a significant effect on
the environment. The Code Amendment is also exempt pursuant to CEQA Guidelines
Section 15301 (Class 1, Existing Facilities), Section 15303 (Class 3, New Construction or
Conversion of Small Structures), and Section 15332 (Class 32, In-fill Development
Projects) because future construction for retail cannabis businesses will largely be within
existing buildings for interior tenant improvements or involve minor new construction that
will also not have a significant effect on the environment; and
WHEREAS, the CEQA findings reflect the City’s independent judgment and
analysis; and
WHEREAS, the City Council finds that the provisions of this Ordinance are
consistent with the City of Costa Mesa’s General Plan; and
WHEREAS, all legal prerequisites prior to the adoption of this Ordinance have
occurred.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF COSTA MESA
DOES HEREBY ORDAIN AS FOLLOWS:
SECTION 1. Zoning Code Amendment. Chapter IX (Special Land Use Regulations),
Article 21 (Location of Marijuana Distributing, Manufacturing, Research and Development
and Testing Laboratories), and Chapter IV (Citywide Land Use Matrix), Table 13-30 (Land
Use Matrix) of Title 13 as specified in Exhibit 1, attached hereto and incorporated herein by
this reference, are hereby amended in their entirety as set forth therein.
SECTION 2. Compliance with CEQA. Pursuant to the California Environmental Quality
Act (CEQA), the Code Amendment has been found to be exempt pursuant to CEQA
Guidelines Section 15061(b)(3) (General Rule) and Section 15308 (Class 8, Actions by
Regulatory Agencies for the Protection of the Environment) the ordinance will not have a
significant effect on the environment. The Code Amendment is also exempt pursuant to
CEQA Guidelines Section 15301 (Class 1, Existing Facilities), Section 15303 (Class 3,
New Construction or Conversion of Small Structures), and Section 15332 (Class 32, In-
fill Development Projects) because future construction for retail cannabis businesses will
largely be within existing buildings for interior tenant improvements or involve minor new
construction that will also not have significant effect on the environment.
SECTION 3. Inconsistencies. Any provision of this ordinance which is inconsistent with
state law shall be interpreted in a manner to be consistent with state law. Any provision
of the Costa Mesa Municipal Code or appendices thereto inconsistent with the provisions
of this Ordinance, to the extent of such inconsistencies and no further, is hereby repealed
or modified to that extent necessary to effect the provisions of this Ordinance.
SECTION 4. Severability. If any section, subsection, sentence, clause, phrase or
portion of this Ordinance is for any reason held to be invalid or unconstitutional by the
decision of any court of competent jurisdiction, such decision shall not affect the validity
of the remaining portions of this Ordinance. The City Council of the City of Costa Mesa
hereby declares that it would have adopted this Ordinance and each section, subsection,
sentence, clause, phrase, or portion thereof, irrespective of the fact that any one or more
sections, subsections, sentences, clauses, phrases or portions be declared invalid or
unconstitutional.
SECTION 5. Effective Date. This Ordinance shall take effect and be in full force thirty
(30) days from and after the passage thereof, and prior to the expiration of fifteen (15)
days from its passage shall be published once in the ORANGE COAST DAILY PILOT, a
newspaper of general circulation, printed and published in the City of Costa Mesa or, in
the alternative, the City Clerk may cause to be published a summary of this Ordinance
and a certified copy of the text of this Ordinance shall be posted in the office of the City
Clerk five (5) days prior to the date of adoption of this Ordinance, and within fifteen (15)
days after adoption, the City Clerk shall cause to be published the aforementioned
summary and shall post in the office of the City Clerk a certified copy of this Ordinance
together with the names and member of the City Council voting for and against the same.
SECTION 6. Certification. The Mayor shall sign and the City Clerk shall certify to the
passage and adoption of this Ordinance and shall cause the same to be published or
posted in the manner required by law.
PASSED AND ADOPTED this _____ day of ________, 2021 by the following XX
vote:
_________________________________
John Stephens, Mayor
ATTEST:
_________________________________
Brenda Green, City Clerk
APPROVED AS TO FORM:
_________________________________
Kimberly Hall Barlow, City Attorney
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss
CITY OF COSTA MESA )
I, Brenda Green, City Clerk of the City of Costa Mesa, do hereby certify that the above
and foregoing is a true and correct copy of Ordinance No. 2021-08 ____ introduced at a regular
meeting of the City Council of the City of Costa Mesa held on the ____ day of _____, 2021, and
was thereafter adopted at a regular meeting held on the _____ day of _______, 2021, by the
following vote:
AYES: COUNCIL MEMBERS:
NOES: COUNCIL MEMBERS:
ABSTAIN: COUNCIL MEMBERS:
ABSENT: COUNCIL MEMBERS:
Said ordinance has been published or posted pursuant to law.
Witness my hand and the official seal of the City of Costa Mesa this ____ day of _______,
2021.
_________________________________
Brenda Green, City Clerk
(SEAL)
EXHIBIT 1
ARTICLE 21. LOCATION OF CANNABIS DISTRIBUTING, MANUFACTURING, RESEARCH AND
DEVELOPMENT, TESTING LABORATORIES, RETAIL STOREFRONT AND RETAIL NON-
STOREFRONT USES
13-200.90. Purpose.
The purpose of this article is to regulate the location of and standards for cannabis distributing
facilities, manufacturing sites, research and development laboratories, testing laboratories, retail
storefront and retail non-storefront uses in order to promote the health, safety, morals and general
welfare of the residents and the businesses within the city by maintaining local control over the
ability to authorize and regulate the location of cannabis businesses.
13-200.91. Applicability.
(a) Nothing in this article is intended, nor shall it be construed, to burden any defense to
criminal prosecution under the Compassionate Use Act of 1996.
(b) All the provisions of this article shall apply to all property, public and private, within
the city.
(c) All the provisions of this article shall apply indoors and outdoors.
(d) Unless otherwise provided herein or in this title, the terms used in this article shall
have the meaning ascribed to them in Title 9, Chapter VI of this Code.
13-200.92. Cannabis distributing facilities, manufacturing sites, research and development
laboratories, and testing laboratories.
(a) Cannabis distribution, manufacturing, research and development and testing is
prohibited in all zone districts within the city, except for those portions of the
manufacturing park (MP) and planned development industrial (PDI) zones that are located
both north of South Coast Drive and west of Harbor Boulevard, excluding any portion of
the South Coast Collection (the “Green Zone”).
(b) A conditional use permit shall be required and may be issued to allow the location of
any business engaged in the distribution, manufacturing, researching and developing, or
testing of cannabis in the MP or PDI zones pursuant to subsection (a) of this section, subject
to the following conditions:
(1) The requirements of Chapter III of this title have been met;
(2) The findings for granting a conditional use permit in accordance with section 13-
29(g) are met;
(3) The applicant obtains a cannabis business license pursuant to Chapter VI of Title
9 of this Code; and
(4) The use is conducted in compliance with all applicable state and local laws.
(c) No person shall engage in any use set forth in this article unless that use is specifically
authorized by Chapter VI of Title 9 of this Code.
13-200.93. Cannabis retail storefront and non-storefront uses.
(a) Cannabis retail storefront uses are prohibited in all zone districts within the city, except
for the commercial zone districts.
(b) Cannabis retail non-storefront uses are prohibited in all zone districts within the city,
except for the commercial zone districts and within the Green Zone.
(c) The following planning application shall be required for cannabis retail uses:
(1) A conditional use permit shall be required for retail storefronts and non-
storefronts; and
(2) An amendment to the approved conditional use permit shall be required for
existing licensed cannabis distribution or manufacturing businesses to operate a
retail non-storefront under the existing business and within the same licensed
premise. The amendment shall be processed as a minor conditional use permit.
(d) A conditional use permit may be issued to allow the location of a retail cannabis use
pursuant to subsections (a) and (b) of this section, subject to the following conditions:
(1) The requirements of Chapter III of this title have been met;
(2) The findings for granting conditional use permit pursuant to section 13-29(g) are
met;
(3) The applicant obtains a cannabis business license for the location pursuant to
Chapter VI of Title 9 of this Code; and
(4) The use is conducted in compliance with all applicable state and local laws.
(e) No cannabis retail storefront use shall be located:
(1) Within one-thousand (1,000) feet from a K-12 school, playground, child daycare,
or homeless shelter, or within six-hundred (600) feet from a youth center, that is in
operation at the time of submission of a completed Cannabis Business Permit
application;
(2) All distances shall be measured in a straight line from the premises where the
cannabis retail use is to be located to the closest property line of a K-12 school,
playground, child daycare, homeless shelter or youth center;
i. For purposes of this sub-sub-section, the property line of a playground
shall be a thirty (30) foot radius from the exterior physical boundaries of
the playground equipment area.
(3) All distances shall be measured without regard to the boundaries of the city and
and/or intervening structures or other barriers;
(4) At a property as for which the zoning administrator, director or planning
commission determines, based on a preponderance of the evidence, that
unpermitted and/or illegal cannabis activity involving sales, delivery and/or
dispensing has taken place at any time in the 365 days preceding an application
under this Article. If an unpermitted and/or illegal cannabis activity has existed on
a property no cannabis business may be permitted on that property unless 365 days
has elapsed since that unpermitted and/or illegal cannabis activity has vacated the
property, and the owner of that property has compensated the City for any and all
expenditure of public funds and resources, including all costs, expenses (including
but not limited to the salaries of peace and/or code enforcement officers) and/or
attorney’s fees, incurred in investigating, abating or attempting to abate the
unpermitted use or uses, whether or not any type of civil, criminal or
administrative proceedings have been commenced against the property, provided
however if the owner of the property is required to evict that use, the 365 days
shall begin to run from the date of the filing of an unlawful detainer complaint, in
which case the a permit may be issued after the 365 days had elapsed and that use
is no longer occupying the property.
(5) A determination and/or finding under sub-section (e)(4) is subject to the appeal
provisions of Chapter IX of Title 2 of this Code.
(f) Retail storefront uses shall be subject to the following development standards in
addition to those contained in Chapter VI of Title 9:
(1) Opaque window coverings unless required by the City for security purposes are
prohibited;
(2) Permanent security or safety bars shall not be placed on any interior or exterior
windows or door, unless required by the City for security purposes;
(3) Directional signage to the use including but not limited to A-frame signs,
sandwich board signs, banners, or flags are prohibited;
(4) No use shall advertise by having a person holding a sign and advertising the
business to passersby, whether such person is on the premises of the commercial
cannabis business or elsewhere including, but not limited to, the public right-of-
way;
(5) Uses shall comply with the landscaping requirements set forth in Chapter VII of
this title including bringing the site landscaping into conformance when feasible
as determined by the director;
(6) Parking requirements shall be subject to Section 13-89;
(7) The hours of operation may be established as part of the planning application
subject to the final review authority and may be more restrictive than those set
forth in Chapter VI of Title 9. Modification of operation hours when established
as part of the planning application shall be subject to an amendment of the
planning application;
(8) Drive-through services or walk-up window services are prohibited;
(9) Outdoor seating or patio areas are prohibited;
(10) Special events that include live entertainment, dancing, and/or amplified music, or
that are otherwise visible and/or audible from the public right-of-way, are
prohibited;
(11) All cannabis products shall be secured after business hours in a locked container
under 24-hour video surveillance; and
(12) For uses within two hundred (200) feet of a residential zone, all exterior lighting
shall be shielded and/or directed away from residential areas. In addition, trash
facilities shall be screened from view and designed and located appropriately to
minimize potential noise and odor impacts to adjacent residential areas.
(g) Non-storefront uses shall be subject to the following development standards in addition
to those contained in Chapter VI of Title 9:
(1) Uses may operate independently from a retail storefront or as a part of, and in
conjunction with, a permitted storefront, distribution, or manufacturing facility;
(2) Parking requirements shall be subject to Section 13-89 and shall also include
sufficient parking spaces for delivery vehicles;
(3) All deliveries to customers shall be completed by 10:00 p.m.; and
(4) The general public shall not be permitted to enter the premises of a non-storefront
retail use.
(h) Except as specifically authorized in this article, all other cannabis retail uses such as
but not limited to lounges and cafes are expressly prohibited in the city.
(i) No person shall engage in any use set forth in this article unless that use is specifically
authorized by Chapter VI of Title 9 of this Code.
(j) Any cannabis use, including but not limited to those involving sale, delivery and/or
dispensing, that is not permitted, licensed and otherwise in full compliance with all
applicable provisions of this Code and state and local law, shall not be considered a
legally non-conforming use pursuant to, and notwithstanding any contrary provisions
of, Chapter IX of this title.
13-200.94. Declaration of public nuisance.
Any use, structure, or property that is altered, enlarged, erected, established, maintained, moved,
or operated contrary to the provisions of this article, is hereby declared to be unlawful and a
public nuisance and may be abated by the city through civil and/or administrative proceedings by
means of a restraining order, preliminary or permanent injunction, or in any other manner
provided by law for the abatement of such nuisances.
13-200.95. Violations.
Violations of this article shall be punishable pursuant to the provisions of section 13-16 in
addition to any other remedy available at law or in equity.
CHAPTER IV. CITYWIDE LAND USE MATRIX
TABLE 13-30
CITY OF COSTA MESA LAND USE MATRIX
ZONES
LAND USES R1
R2-
MD
R2-
HD R3 AP CL C1 C2
C1-
S1 TC1 MG MP
PDR-
LD1
PDR-
MD1
PDR-
HD1
PDR-
NCM1 PDC1 PDI1 I&R1
I&R-
S1
I&RM
LT1 P
INSTITUTIONAL AND RECREATIONAL USES
31a. Marijuana
and/or medical
marijuana
cultivation
• • • • • • • • • • • • • • • • • • • • • •
31b. Cannabis
and/or marijuana
distributer
• • • • • • • • • • • C9 • • • • • C9 • • •
31c. Cannabis
and/or marijuana
manufacturer or
processor
• • • • • • • • • • • C9 • • • • • C9 • • •
31d. Cannabis
and/or marijuana
• • • • • C9 C9 C9 C9 C9 • • • • • • • • • • •
retail sales:
storefront
31e. Cannabis
and/or marijuana
retail sales: non-
storefront
(deliveries)
• • • • • C9 C9 C9 C9 C9 • C9 • • • • • C9 • • • •
31f. Cannabis
and/or marijuana
research and
development
and/or testing
laboratories
• • • • • • • • • • • C9 • • • • • C9 • • • •
1 Uses proposed in this zone are subject to verification of consistency with the adopted master plan. Uses not specified in the
master plan, could be allowed, subject to the review process indicated in this matrix, if the proposed use is determined to be
compatible with the adopted master plan. Residential uses shall not be permitted on any site or parcel of land on which
residential uses are expressly prohibited by the general plan.
2 This use is subject to the requirements of the referenced Municipal Code article or section.
3 If residential uses exist, accessory uses shall be permitted.
4 For the purposes of this table, the symbols in the non-shaded areas shall have the following meaning: C—Conditional Use
Permit; MC—Minor Conditional Use Permit; P—Permitted; •—Prohibited; and S—Special Use Permit.
5 Six-hundred--fifty-foot separation required between sober living homes, or from state licensed alcohol or drug abuse
recovery or treatment facilities. CMMC 13-311(a)(10)(i).
6 Subject to the separation requirement set forth in sections 13-322(a)(3) and 13-323(b).
7 Small boardinghouses shall locate at least six hundred fifty (650) feet from any other small boardinghouse. Large
boardinghouses shall be located at least one thousand (1,000) feet away from any other boardinghouse.
8 Uses prohibited in the base zoning district of a mixed-use overlay zone shall also be prohibited in the overlay zone.
9 Prohibited at the SoCo property, 3303 through 3323 Hyland Ave.
10 Emergency shelters located on sites owned, controlled, and/or operated by the city in the MP and/or the PDI zone are a
permitted use and the standards in section 13-200.79(1), (2), (4), (8), (10) and (13) do not apply to such uses.
ORDINANCE NO. 2021-09
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF COSTA
MESA, CALIFORNIA AMENDING SECTION 9-29.5 OF ARTICLE 5
(ADMINISTRATION, APPLICATION AND PROCEDURES) OF CHAPTER
I (BUSINESS TAX) AND SECTIONS 9-116, 9-119, 9-120 & 9-121 OF
CHAPTER II (REGULATION OF CERTAIN BUSINESSES) AND
CHAPTER VI (MARIJUANA BUSINESS PERMITS) OF TITLE 9
(LICENSES AND BUSINESS REGULATIONS) TO ESTABLISH THE TAX
RATE, OPERATING REQUIREMENTS AND STANDARDS FOR
CANNABIS USES, INCLUDING RETAIL CANNABIS STOREFRONT
AND NON-STOREFRONT USES TO IMPLEMENT THE CITY OF COSTA
MESA RETAIL CANNABIS TAX AND REGULATION MEASURE
(MEASURE Q)
WHEREAS, the City of Costa Mesa, pursuant to its police power, may adopt regulations
to protect the health, safety and welfare of the public, Cal. Const. art. XI, § 7, Cal. Gov.
Code § 37100, and thereby is authorized to declare what use and condition constitutes a
public nuisance; and
WHEREAS, on November 3, 2020, city voters approved the “City of Costa Mesa Retail
Cannabis Tax and Regulation Measure”, also known as Measure Q;
WHEREAS, Measure Q authorizes the City Council to adopt an ordinance which permits
and regulates retail cannabis storefront (dispensaries) and non-storefront (delivery)
businesses;
WHEREAS, Measure Q authorizes the City Council to impose a four percent (4%) to
seven percent (7%) gross receipts tax on retail cannabis businesses. In addition, Measure
Q requires retail cannabis businesses to meet certain operating requirements including
permitted zones, minimum of one thousand feet (1,000’) from sensitive uses such as
schools, childcare centers, playgrounds and homeless shelters, security measures, and
labor peace agreement for businesses with two or more employees;
WHEREAS, this Ordinance is necessary to implement Measure Q and establish the
minimum operating requirements and development standards in the Costa Mesa
Municipal Code to tax, review, and regulate retail cannabis storefront and non-storefront
businesses in the City;
WHEREAS, Ordinance No. 2021-09 has been reviewed for compliance with the California
Environmental Quality Act (CEQA), the CEQA guidelines, and the City’s environmental
procedures. The Code Amendment has been found to be exempt pursuant to CEQA
Guidelines Section 15061(b)(3) (General Rule) and Section 15308 (Class 8, Actions by
Regulatory Agencies for the Protection of the Environment) because a recommendation
is not a final action and the recommended ordinance will not have a significant effect on
the environment. The Code Amendment is also exempt pursuant to CEQA Guidelines
Section 15301 (Class 1, Existing Facilities), Section 15303 (Class 3, New Construction or
Attachment 2
Conversion of Small Structures), and Section 15332 (Class 32, In-fill Development
Projects) because future construction for retail cannabis businesses will largely be within
existing buildings for interior tenant improvements that will also not have significant effect
on the environment;
WHEREAS, the City Council finds that the provisions of this Ordinance are consistent
with the City of Costa Mesa’s General Plan; and
WHEREAS, all legal prerequisites prior to the adoption of this ordinance have occurred.
THE COSTA MESA CITY COUNCIL DOES HEREBY ORDAIN AS FOLLOWS:
Section 1: Title 9, Chapter I, Article 5, Section 9-29.5 of the Costa Mesa Municipal
Code, is hereby amended to read as follows:
9-29.5. Cannabis tax.
Notwithstanding any other provision of this Code, every person engaged in, managing,
conducting, or carrying on any cannabis business defined in Chapter VI of this title, or
any other marijuana and/or cannabis business, shall pay an annual business tax as
follows:
(a) Every person who is lawfully engaged in, managing, conducting, or carrying
on a business as a cannabis distributor, manufacturer, and/or research and
development laboratory, as set forth in Section 9-486(a), shall pay an
annual business tax of one (1) percent based on the gross receipts of that
business.
(b) Every person who is lawfully engaged in, managing, conducting, or carrying
on a business as a cannabis testing laboratory, as set forth in Section 9-
486(a), shall pay no annual business tax.
(c) Every person who is engaged in, managing, conducting, or carrying on a
business as a cannabis store-front retailer, as set forth in Section 9-486(a),
and/or who otherwise sells, dispenses and/or furnishes cannabis anywhere
within the city, shall pay an annual business tax of seven (7) percent based
on the gross receipts of that business.
(d) Every person who is engaged in, managing, conducting, or carrying on a
business as a cannabis non-store front retailer, as set forth in Section 9-
486(a), and/or who otherwise delivers cannabis anywhere within the city,
shall pay an annual business tax of seven (7) percent based on the gross
receipts of that business, subject to the applicable provisions of section 9-
40.
(e) Every cannabis business that is engaged as a distributor, manufacturer, or
research and development laboratory, that is also engaged in retail sales or
delivery of the same cannabis products, shall pay the business tax as set
forth in 9-29.5 subsections (c) and (d), as applicable, for the retail sale or
delivery of the same cannabis and cannabis products and is not required to
pay business taxes set forth in 9-29.5(a). The operator has the burden of
proving that the cannabis or cannabis products involved in the distribution,
manufacturing, and/or research and development are the same.
(f) The proceeds of the tax set forth in sub-sections (a), (c), (d), and (e) shall
be subject to an annual audit as scheduled by the City Manager or Director
of Finance.
(g) One half of one percent of the proceeds of the tax set forth in sub-sections
(c) and (d) shall be directed toward the implementation of the Cultural and
Arts Master Plan and one half of one percent shall be directed towards the
implementation of a first time homebuyer program for current residents of
the City, former residents who were raised in the City and/or who graduated
from the Newport Mesa Unified School District.
Section 2: Title 9, Chapter II, Article 1, Sections 9-116, 9-119, 9-120 and 9-121 of the
Costa Mesa Municipal Code, are each hereby amended to read as follows:
9-116. Issuing officer.
“Issuing officer” shall mean the city council of Costa Mesa, the city manager, the Director
of Finance, the fire chief, the chief of police, or the director of Economic and Development
Services, as applicable, including such person’s designee.
9-119. Revocation or suspension of permits.
A business tax registration certificate or any other permit issued under this title may be
revoked or suspended on the following grounds:
(a) Where said issuing officer has found and determined that the preservation
of the public health, safety, peace and welfare necessitate revocation of
said business tax registration certificate or permit.
(b) Where the applicant or permittee has violated any applicable provisions of
this title, other provisions of this Code as defined in section 1-35, order of
the Health Officer or the Emergency Services Director and/or any other
provision of law.
(c) Where a business tax registration certificate or permit has been granted on
false or fraudulent evidence, testimony, or application.
(d) Where the applicant or permittee has violated the terms and provisions of
said business tax registration certificate or permit.
Exception. Notwithstanding the foregoing or any other provision of this title to the contrary,
licenses issued to chiropractors, laboratory technicians, dentists, medical doctors,
opticians, physical therapists, nurses, psychologists, pharmacists, veterinarians,
accountants, advertising architects, landscape architects, building designers, attorneys,
barbers, engineers, collection agencies, contractors, cosmetologists, private detectives,
funeral directors, shorthand reporters, structural pest control operations, land surveyors,
ship brokers, cleaners and dyers, electronic repair dealers, real estate agents and
brokers, marriage counselors, auto dealers, boxers and wrestlers, furniture and bedding
dealers and manufacturers, manufacturers of paints, petroleum activities, dealers in
secondhand goods, or any other business, profession or trade where the determination
of issuance or revocation of the right of any person to engage in such business,
profession, or trade is solely vested in a state board or agency and is not otherwise
regulated by this code, shall be issued upon filing the requisite application and payment
of the requisite fees and shall not be subject to revocation or suspension except any such
business tax registration certificate may be revoked for nonpayment of fees or upon
revocation of the state board or agency license.
9-120. Permittee entitled to hearing prior to revocation or suspension.
(a) No business tax registration certificate or permit shall be revoked or suspended
until said permittee has had an opportunity for a hearing before the issuing
officer.
(b) Written notice of the revocation or suspension, the reasons therefore and the
requirement to request a hearing shall be given by certified mail to a certificate
holder or permittee’s last known mailing address or by such other method
reasonably calculated to provide notice.
(c) The revocation or suspension shall be final and effective after ten (10) calendar
days following the date of mailing set forth in sub-section (b), unless the
certificate holder or permittee files an application for a hearing with the city clerk
prior to such effective date. There shall be no cost to the certificate holder or
permittee for such a hearing under this section.
(d) Except as otherwise provided in sub-section (e) the hearing shall be
commenced within 30 calendar days of the fling of an application for hearing.
Hearings conducted pursuant to this section shall be open to the public, shall
not be conducted according to the technical or traditional rules relating to
evidence, and shall provide, personally or by counsel or both, an opportunity
for certificate holder or permittee to defend and present evidence on their
behalf. At least ten calendar days prior to the hearing, certificate holder or
permittee shall be provided with any documentation upon which the revocation
or suspension is based. Following the close of the hearing the issuing officer
shall within 30 days render a written decision whether or not to impose
revocation or suspension.
(e) Notwithstanding the foregoing, the city manager or director of finance may
suspend, pending a hearing, any business tax registration certificate or permit
where it has been determined by said official that an immediate suspension of
the business tax registration certificate or permit is necessary for the protection
of the public health, safety, peace and welfare. In the event of such a
suspension, the director of finance shall, within twelve (12) hours after said
suspension, cause to be served upon said business or permittee a written
statement containing the grounds for said suspension, any written
documentation upon which the revocation is based and a notice of hearing to
show cause before the issuing officer why said permit should not be
permanently revoked, which said hearing shall be commenced no later than
five (5) calendar days following the service of said notice unless the parties
thereto agree otherwise, and thereafter followed by a written decision pursuant
to sub-section (d).
9-121. Appeal from the decision of the issuing officer.
Appeals from decision of the hearing officer provided for herein shall be made in
accordance with the procedure of Chapter IX of Title 2 of this Code.
Section 3: Title 9, Chapter VI of the Costa Mesa Municipal Code, is hereby amended
in its entirety to read as follows:
CHAPTER VI. CANNABIS BUSINESS PERMITS
9-481. Purpose and intent.
It is the purpose and intent of this chapter to regulate the distributing, manufacturing,
processing, research and development, retail sale, testing and transporting of cannabis
and cannabis-related products in a manner which is responsible, which protects the
health, safety, and welfare of the residents of Costa Mesa, and to enforce rules and
regulations consistent with state law. In part to meet these objectives, a permit shall be
required in order to own and/or to operate a cannabis business within the city. Nothing in
this chapter is intended to authorize the possession, use, or provision of cannabis for
purposes which violate state or federal law. The provisions of this chapter are in addition
to any other permits, licenses, and approvals which may be required to conduct business
in the city, and are in addition to any permits, licenses and approvals required under state
law.
9-482. Legal authority.
Pursuant to Sections 5 and 7 of Article XI of the California Constitution and the provisions
of Division 10 of the Business and Professions Code, the city is authorized to adopt
ordinances that establish standards, requirements and regulations for local licenses and
permits for cannabis and cannabis-related activity.
9-482.5 Authority of the City Manager
The City Manager is authorized to make reasonable rules, policies, and procedures
consistent with the intent and spirit of this Chapter as may be necessary to administer
and enforce the provisions of this Chapter and any other ordinances, regulations or laws
relating to and affecting the permitting and operations of commercial cannabis
businesses.
The City Manager is authorized to make reasonable rules, policies, and procedures
consistent with the intent and spirit of this Chapter concerning the applications, the
application process, the information required of applicants, the application procedures,
and the administration and procedures to be used and followed in the application process
for permit applications and requests for permit changes or modifications pursuant to this
Chapter, and the implementation and administration of social equity programs.
9-483. Cannabis business activities prohibited unless specifically authorized by
this chapter.
Except as specifically authorized in this chapter, the manufacture, processing, storing,
laboratory testing, labeling, transporting, dispensing, furnishing, distribution, delivery, or
sale of cannabis or a cannabis product is expressly prohibited in the city.
9-484. Compliance with laws.
It is the responsibility of the owners and operators of the cannabis business to ensure
that it is, at all times, operating in a manner compliant with all applicable state and local
laws, and any regulations promulgated thereunder.
9-485. Definitions.
Unless otherwise defined in this chapter or in chapter I of Title 13, the words used in this
chapter shall have the same definitions ascribed to them in Division 10 of the Business
and Professions Code or the definitions of the Health and Safety Code applicable to
school, child daycare and playground. Any reference to California statutes includes any
regulations promulgated thereunder and is deemed to include any successor or amended
version of the referenced statute or regulatory provision.
Cannabis means all parts of the Cannabis sativa Linnaeus, Cannabis indica, or Cannabis
ruderalis, whether growing or not; the seeds thereof; the resin, whether crude or purified,
extracted from any part of the plant; and every compound, manufacture, salt, derivative,
mixture, or preparation of the plant, its seeds, or resin. “Cannabis” also means the
separated resin, whether crude or purified, obtained from marijuana. “Cannabis” also
means marijuana as defined by section 11018 of the California Health and Safety
Code as enacted by Chapter 14017 of the Statutes of 1972. “Cannabis” does not include
the mature stalks of the plant, fiber produced from the stalks, oil or cake made from the
seeds of the plant, any other compound, manufacture, salt, derivative, mixture, or
preparation of the mature stalks (except the resin extracted therefrom), fiber, oil, or cake,
or the sterilized seed of the plant which is incapable of germination. For the purpose of
this chapter, “cannabis” does not mean industrial hemp as that term is defined by section
81000 of the California Food and Agricultural Code or section 11018.5 of the
California Health and Safety Code.
Cannabis business permit means a regulatory permit issued by the city pursuant to this
chapter to a cannabis business, and is required before any cannabis activity may be
conducted in the city.
Cannabis goods means cannabis and/or cannabis products.
Cannabis product or manufactured cannabis product or product means cannabis that
has undergone a process whereby the plant material is transformed into a concentrate
for internal consumption or topical application, including, but not limited to, concentrated
cannabis, an edible cannabis product, or a topical cannabis product containing cannabis
or concentrated cannabis in combination with other ingredients.
Caregiver or primary caregiver has the same meaning as that term is defined in section
11362.7 of the California Health and Safety Code.
City manager shall mean the city manager of the city or designee.
Director shall mean the city’s Director of the Economic and Development Services
department or designee, unless otherwise specified.
Dispensing means any activity involving the retail sale of cannabis or cannabis products.
Distributor means a person or entity that engages in distribution. The direct and/or retail
sale, distribution, or furnishing of any cannabis or cannabis product to any consumer or
end user by a distributor is expressly prohibited, unless otherwise authorized pursuant to
this chapter.
Edible cannabis product means manufactured cannabis that is intended to be used, in
whole or in part, for oral human consumption including, but not limited to, chewing gum,
but excluding products set forth in Division 15 (commencing with Section 32501) of the
California Food and Agricultural Code. An edible cannabis product is not considered
food as defined by California Health and Safety Code Section 109935 or a drug as
defined by California Health and Safety Code Section 109925.
Free sample means any amount of cannabis goods provided to a patron of a business
or member of the public without cost or payment or exchange for any other thing of
value.
Green Zone means those portions of the manufacturing park (MP) and planned
development industrial (PDI) zones that are located both north of South Coast Drive and
west of Harbor Boulevard, excluding any portion of the South Coast Collection.
Homeless shelter has the same meaning as emergency shelter.
Labor Peace Agreement has the same meaning set forth in Business and Professions
Code section 26001.
Manufacturing site means a location where cannabis products are manufactured.
Marijuana means “cannabis,” as that term is defined in this chapter.
Marijuana activity and/or cannabis activity includes manufacture, processing, laboratory
testing, research and development, transporting, delivery, dispensing, distribution,
furnishing, giving away or sale or any other activity involving cannabis or a cannabis
product.
Marijuana business and/or cannabis business means any business or operation which
engages in any marijuana or cannabis activity.
Marijuana business permit has the same meaning as cannabis business permit.
Patient or qualified patient shall have the same definition as California Health and Safety
Code section 11362.7 et seq., as it may be amended, and which means a person who is
entitled to the protections of California Health and Safety Code section 11362.5. For
purposes of this chapter, a qualified patient shall include a person with an identification
card as that term is defined by California Health and Safety Code section 11362.7 et seq.
Person with an identification card shall have the meaning given that term by
California Health and Safety Code section 11362.7.
Playground shall mean a public playground located in a city park.
Premises shall have the same meaning as set forth in Business and Professions Code
section 26001 sub-section (ap) for purposes of measuring the required distance from
retail storefront uses to those uses set forth in section 13-200.93(e)(1).
Processing and processor shall have the same meaning as manufacturing and
manufacturer, respectively.
Property shall mean any single development lot that has been subdivided bearing its own
assessor’s parcel number or with an approved subdivision map or condominium map
unless the context clearly indicates a different meaning.
Research and development laboratory means a facility, entity, or site in the city that
performs research into and/or the development of cannabis or cannabis products, where
cannabis in any amount is located on-site, and that is both of the following:
1. Accredited by an accrediting body that is independent of all other persons
involved in the cannabis industry in the state.
2. Registered with the State Department of Public Health, and is owned and
operated by a person issued a valid cannabis business permit for laboratory
testing from the city and is currently in compliance with all applicable state
and local laws and regulations pertaining to the cannabis business and
cannabis activities.
South Coast Collection or SoCo means all properties located at 3303 through 3323,
inclusive, Hyland Avenue, in the City of Costa Mesa, commonly known as “SoCo” or
“SOCO.”
State means the State of California, including any of its departments, divisions, and/or
bureaus.
State license means a permit or license issued by the state to engage in cannabis activity.
Youth center means any public or private facility that is primarily used to host recreation
or social activities for minors, specifically private youth membership organizations or
clubs, social services teenage club facilities, video arcades where ten (10) or more games
or game machines or devices are operated or similar amusement park facilities, but does
not include dance studios, tutoring, martial arts studios or similar type of uses.
9-486. Type of authorized cannabis businesses permitted.
(a) One (1) or more of the following types of adult (A-license) and/or medical (M-
license) cannabis business may be permitted to operate within the city:
1. Cannabis distributor (includes license classification type 11);
2. Cannabis manufacturer (includes license classification type 6 and 7);
3. Cannabis testing laboratory (includes license classification type 8);
4. Cannabis retail - storefront (includes license classification type 10);
5. Cannabis retail - non-storefront (includes license classification type 9); and
6. Cannabis research and development laboratory.
(b) Businesses permitted pursuant to this chapter shall not engage in the retail sale,
delivery or dispensing of cannabis, cannabis product, hemp or hemp products
unless expressly permitted to do so pursuant to the terms of their cannabis
business permit.
(c) No person may engage in any type of cannabis business that is not specifically
authorized pursuant to this section and this code, including, but not limited to,
cultivating cannabis.
(d) The City Council may by resolution limit and/or restrict the number of cannabis
retail permits available for issuance and/or renewal.
9-487. Cannabis business permit required to engage in a cannabis business.
No person may engage in any cannabis business or in any cannabis activity within the
city including manufacturing, processing, laboratory testing, transporting, dispensing,
distribution, or sale of cannabis or a cannabis product unless the person: 1) has a valid
cannabis business permit from the city that authorizes the specific business and activity
at specific location; 2) has a valid business license issued to the entity that is listed on the
cannabis business permit; and 3) is currently in compliance with all other applicable state
and local laws and regulations pertaining to the cannabis business and cannabis activity.
9-487.5. Change in business name.
No operator shall operate, conduct, manage, engage in, or carry on a cannabis business
under any name other than the business name specified in the permit and/or any “doing
business as” or “DBA”, or “fictitious business name” or “FBN”, provided in the permit
application and/or business license. Proof of the “DBA” or “FBN” filing with the County
Clerk Recorder shall be required. Any approved changes and/or updates to the permit
may require payment of fees as set by resolution of the City Council.
9-488. Term of permit-Fees.
(a) A cannabis business permit shall be valid for two (2) years from the date of issue,
unless otherwise suspended or revoked, and may be renewed bi-annually
thereafter, provided the permittee is in compliance with the provisions of this
chapter.
(b) Cannabis business permit application fees and renewal fees shall be established
by resolution of the city council as may be amended from time to time.
9-489. Effect of state license suspension, revocation, or termination.
Suspension of a license issued by the State of California, or by any of its departments or
divisions, shall immediately suspend the ability of a cannabis business to operate within
the city, until the State of California, or its respective departments or divisions, reinstates
or reissues the State license within 90 days. Should the state license remain suspended
for 90 days or longer, any permit issued pursuant to this chapter shall expire and be of no
further force and effect. Should the State of California, or any of its departments or
divisions, revoke or terminate the license of a cannabis business, such revocation or
termination shall also revoke or terminate the ability of a business permitted pursuant to
this chapter including the persons and entities set forth in section 9-490(c) to operate any
cannabis business within the city for a period of five years from the date of such revocation
or termination.
9-490. Denial and revocation.
(a) Revocation. A cannabis business permit may be revoked or suspended pursuant
to the procedures of section 9-120 for failing to comply with the terms of the permit,
the applicable provisions of this chapter, this Code, city regulations, state law or
regulations and/or any conditions of any other permit issued pursuant to this Code.
(b) Denial. An application for a cannabis business permit may be denied where it fails
to provide all required information, documentation and/or fees and/or where it does
not or would not be able to comply with the applicable provisions of this chapter,
this Code, city regulations and/or state law or regulations and/or where the
applicant is otherwise ineligible for such permit.
(c) Effect of revocation and denial. Whenever an application for a permit is denied,
no other similar application by such applicant or permittee will be considered for
a period of one (1) year from the date of the denial of an application. Whenever
a permit has been revoked, no other similar application by such permittee shall be
considered for a period of five (5) years from either the date the notice of the permit
revocation was mailed or the date of the final decision of the city to revoke the
permit, whichever is later. The prohibitions of this subsection shall also apply to
the following:
1. Any individual whose permit was revoked or whose application was denied
who later becomes a director or officer of a corporation, profit or nonprofit,
or a member of a partnership or a person owning or possessing any portion
of the shares of a corporation seeking to obtain a new permit.
2. A corporation, profit or nonprofit, whose permit was revoked, or application
was denied, to any of its directors or officers or to any person who owned
any portion of its shares, who attempts by way of a new corporation or
using their individual names or becoming a member of a partnership or a
director or officer or a person owning or possessing any portion of the
shares in another corporation seeking to obtain a new permit.
(d) Ineligibility. In addition to any other law, no person or entity shall be eligible for
and/or receive a cannabis permit if that person or entity, or any director or officer
of that entity or a person who owned any portion of that entity’s shares, engaged
in unpermitted and/or illegal cannabis activity involving sales, delivery and/or
dispensing in the city, or had an ownership interest in any property set forth in
section 13-200.93(e)(5), in the five (5) years preceding an application under this
chapter. A determination of ineligibility under this sub-section (d) may be made by
the City Manager and shall be based on the preponderance of the evidence.
9-491. Appeals.
Notwithstanding any other provision of this code, only a decision by the city manager to
suspend, revoke or deny a cannabis business permit under this chapter shall be subject
to appeal, which shall be governed by the procedures set forth in Chapter IX of Title 2 of
this code.
9-492. Prohibition on transfer of cannabis business permits.
In the event a permit holding cannabis business sells or transfers the business to a new
owner and/or operates the business under a new entity and/or name not listed on the
permit, the new owner must obtain a new cannabis business permit and business license
prior to commencing or continuing operations. A cannabis business shall be deemed to
have transferred to a new owner within the meaning of this section if person(s) or entities
with controlling interest at the time the permit was first issued cease(s) at any time to
possess controlling ownership interest and/or an ownership interest of less than fifty-one
(51) percent.
9-493. City business license required.
Prior to commencing operations, a cannabis business shall obtain and thereafter maintain
a valid city business license pursuant to Chapter I of this title. Failure to do so will render
the cannabis permit invalid.
9-494. Conditional use permit required.
No cannabis business permit shall be issued, and no person shall conduct a cannabis
business unless a conditional use permit has been issued therefore pursuant to the
provisions of Title 13, Chapter IX, Article 21 of this Code.
9-495. Operating requirements for all cannabis businesses permitted under this
chapter.
(a) Records and recordkeeping.
1. Each owner and operator of a cannabis business shall maintain accurate
books and records, detailing all of the revenues and expenses of the
business, and all of its assets and liabilities. On no less than an annual basis
(at or before the time of the renewal of a cannabis business permit issued
pursuant to this title), or at any time upon reasonable request of the city,
each cannabis business shall file a sworn statement detailing the number
of sales by the cannabis business during the previous twelve (12) month
period (or shorter period based upon the timing of the request), provided on
a per-month basis. The statement shall also include gross sales for each
month, and all applicable taxes paid or due to be paid.
Each owner and operator shall keep and preserve for a period of no less
than seven (7) years, all records as may be necessary to determine the
amount of such tax the operator may have been liable to collect and remit
to the city.
2. Each owner and operator of a cannabis business shall maintain a current
register of the names and the contact information (including the name,
address, telephone number, a copy of that person’s government issued
identification, and email address) of anyone owning or holding an interest
in the cannabis business, and separately of all the officers, managers,
employees, agents and volunteers currently employed or otherwise
engaged by the cannabis business. The register required by this paragraph
shall be provided to the city manager upon a reasonable request.
3. All cannabis businesses shall maintain an inventory control and reporting
system that accurately documents the present location, amounts, and
descriptions of all cannabis and cannabis products for all stages of the
production or manufacturing, laboratory testing and distribution processes.
4. Subject to any restrictions under the Health Insurance Portability and
Accountability Act (HIPPA), each cannabis business shall allow city officials
to have access to the business’s books, records, accounts, together with
any other data or documents relevant to its permitted cannabis activities,
for the purpose of conducting an audit or examination. Books, records,
accounts, and any and all relevant data or documents will be produced no
later than twenty-four (24) hours after receipt of the city’s request, unless
otherwise stipulated by the city.
(b) Security measures.
1. A permitted cannabis business shall implement sufficient security measures
to deter and prevent the unauthorized entrance into areas containing
cannabis or cannabis products, and to deter and prevent the theft of cannabis
or cannabis products at the cannabis business. These security measures
shall include:
a. Establishing limited access areas accessible only to authorized
cannabis business personnel;
b. All cannabis and cannabis products shall be stored in a secured and
locked room, safe, or vault, and shall be kept in a manner as to prevent
diversion, theft, and loss;
c. Sensors shall be installed to detect entry and exit from all secure
areas;
d. Having a professionally installed, maintained, and monitored alarm
system;
e. Any bars to be installed on the windows or the doors of the cannabis
business for security purposes, if permitted by the city, shall be
installed only on the interior of the building;
f. Security personnel if utilized must be licensed by the State of California
Bureau of Security and Investigative Services Personnel, shall comply
with the requirements of California Business and Professions Code
Chapters 11.4 and 11.5 of Division 3, and have a valid business
license from the city; and
g. Each cannabis business shall have the capability to remain secure and
operational during a power outage and shall ensure that all access
doors are not solely controlled by an electronic access panel to ensure
that locks are not released during a power outage.
2. Each cannabis business shall identify a designated security
representative/liaison to the city, who shall be reasonably available to meet
with the city manager regarding any security related measures or and
operational issues.
3. A cannabis business shall notify the city manager within twenty-four (24)
hours after discovering any of the following:
a. Significant discrepancies identified during inventory, as set forth in the
city’s administrative regulations;
b. Diversion, theft, loss, or any criminal activity involving the cannabis
business or any agent or employee of the cannabis business; or
c. The loss or unauthorized alteration of records related to cannabis,
registering qualifying patients, primary caregivers, or employees or
agents of the cannabis business and/or cannabis sales.
(c) Restriction on alcohol sales. No person shall cause or permit the sale, dispensing,
or consumption of alcoholic beverages on or about the premises of the cannabis
business.
(d) Compliance with laws. It is the responsibility of the owners and operators of the
cannabis business to ensure that it is, at all times, operating in a manner compliant
with all applicable state and local laws, and any regulations promulgated
thereunder. Nothing in this chapter shall be construed as authorizing any actions
which violate state law or local law with respect to the operation of a cannabis
business or any site-specific, additional operating procedures or requirements
which may be imposed as conditions of approval of the location of the cannabis
business.
(e) Taxes. All cannabis businesses authorized to operate under this chapter shall pay
all sales, use, business and other applicable taxes, and all license, registration,
and other fees required under federal, state and local law. Each cannabis business
shall cooperate with the city with respect to any reasonable request to audit the
cannabis business’s books and records for the purpose of verifying compliance
with this section, including, but not limited to, a verification of the amount of taxes
required to be paid during any period.
(f) Insurance. Permittee shall obtain and maintain at all times during the term of the
permit comprehensive general liability insurance and comprehensive automotive
liability insurance protecting the permittee in an amount of not less than one million
dollars ($1,000,000.00) per occurrence, combined single limit, including bodily
injury and property damage and not less than one million dollars ($1,000,000.00)
aggregate for each personal injury liability, products-completed operations and
each accident, issued by an insurance provider rated at least A-:VIII in A.M. Best
and Company’s Insurance Guide and either admitted and authorized to do
business in California or is listed on the California Department of Insurance’s List
of Approved Surplus Line Insurers.
(g) Miscellaneous operating requirements.
1. Restriction on consumption. Cannabis shall not be consumed on the
premises of any cannabis businesses or elsewhere in the city other than
within private residences.
2. No cannabis or cannabis products or graphics depicting cannabis or
cannabis products shall be visible from the exterior of any property issued
a cannabis business permit, or on any of the vehicles owned or used as part
of the cannabis business. No outdoor storage of cannabis or cannabis
products is permitted at any time.
3. Reporting and tracking of product and of gross sales. Each cannabis
business shall have in place a point-of-sale tracking system to track and
report on all aspects of the cannabis business including, but not limited to,
such matters as cannabis tracking, inventory data, and gross sales (by
weight and by sale). The cannabis business shall ensure that such
information is compatible with the city’s record-keeping systems. The
system must have the capability to produce historical transactional data for
review by the city manager.
4. All cannabis and cannabis products sold, distributed or manufactured shall
be cultivated, manufactured, and transported by licensed facilities that
maintain operations in full conformance with all state and local regulations.
5. There shall not be a physician located in or around any cannabis business
at any time for the purpose of evaluating patients for the issuance of a
cannabis prescription or card.
6. Signage and notices.
a. In addition to the requirements otherwise set forth in this section,
business identification signage for a cannabis business shall conform
to the requirements of this Code, including, but not limited to, seeking
the issuance of a city sign permit.
b. Each entrance to a cannabis business shall be visibly posted with a
clear and legible notice indicating that smoking, ingesting, or otherwise
consuming cannabis on the premises or in the areas adjacent to the
cannabis business is prohibited.
c. Business identification signage shall be limited to that needed for
identification only.
d. The business shall at all times comply with the advertising and
marketing restrictions of Business and Professions Code sections
26150-26156, in addition to the requirements of this code.
7. Minors.
a. Persons under the age of twenty-one (21) years shall not be allowed on
the premises of a cannabis business, except as otherwise specifically
provided for by state law. It is unlawful and a violation of this chapter for
any person to employ any person at or for a cannabis business who is
not at least twenty-one (21) years of age.
b. The entrance to the cannabis business shall be clearly and legibly posted
with a notice that no person under the age of twenty-one (21) years of
age is permitted to enter upon the premises of the cannabis business
except as specifically provided for herein.
8. Odor control. Odor control devices and techniques shall be incorporated in
all cannabis businesses to ensure that odors from cannabis are not
detectable off-site.
9. Display of permit and city business license. The original copy of the
cannabis business permit issued by the city pursuant to this chapter and the
city-issued business license shall be posted inside the cannabis business
in a conspicuous location.
10. Background check. Every owner, manager, supervisor or employee of the
cannabis business must submit fingerprints and other information deemed
necessary by the city manager for a background check by the Costa Mesa
police department to verify that person’s criminal history. No person shall
be issued a permit to operate a cannabis business who has been convicted
of a felony within the past seven (7) years, unless that felony has been
dismissed, withdrawn, expunged or set aside pursuant to Penal
Code section 1203.4, 1000 or 1385, or who is currently on probation or
parole for the sale, distribution, possession or manufacture of a controlled
substance. Exempted from this prohibition is a conviction for a felony
involving cannabis and/or marijuana for which the underlying cannabis or
marijuana offense has subsequently been designated a misdemeanor or
infraction or decriminalized pursuant to the provisions of the Control,
Regulate and Tax Adult Use of Marijuana Act or federal law.
11. Loitering. The owner and/or operator of a cannabis business shall prohibit
loitering by persons outside the facility both on the premises and within fifty
(50) feet of the premises.
12. Permits and other approvals. Prior to the establishment of any cannabis
business or the operation of any such business, the person intending to
establish a cannabis business must first obtain all applicable planning,
zoning, building, and other applicable permits from the relevant
governmental agency which may be applicable to the zoning district in
which such cannabis business intends to operate.
13. Free samples. No cannabis business shall provide or cause to be provided
any free sample of cannabis goods to any person within the city.
14. A licensed retailer may only sell cannabis goods, cannabis accessories, and
licensees’ branded merchandise or promotional materials
(h) Additional operating requirements for retail sale (storefront) businesses. In
addition to every other requirement of this section, other than those set forth in
subsection (i) (retail sale, non-storefront) that are expressly inapplicable, every
business that sells cannabis as a storefront retailer shall comply with the following
requirements:
1. The security plan shall include at least one (1) licensed private security
guard or guards who shall be present at the premises twenty-four (24)
hours per day, exterior lighting, and continuous video monitoring and
recording of the interior and exterior of the premises. Video surveillance
recordings must also include video of all entryways and exits of the
premises. All video recordings shall be maintained for a minimum of
ninety (90) days.
2. Both the private security guard and the business personnel shall
monitor the premises and the immediate vicinity of the premises to
ensure that patrons immediately leave the premises and do not
consume cannabis in the vicinity of the retail business or on the property
or in the parking lot, and shall ensure that persons do not loiter, linger,
or otherwise congregate within fifty (50) feet of the entrance to the
premises.
3. There shall be no on-site sales of alcohol or tobacco products,
(excluding rolling papers and lighters) and no on-site consumption of
food, alcohol, cannabis or tobacco by patrons.
4. Hours of operation shall be limited to: 7:00 a.m. to 10:00 p.m. daily. No
licensed retail business shall be open to the public between the hours of
10:01 p.m. and 6:59 a.m. of any day.
5. The cannabis retail business shall notify patrons of the following both
verbally and through posting of a sign in a conspicuous location:
a. Unlawful sale, barter or distribution of cannabis is a crime and
subject to a fine or arrest.
b. Loitering on and around the retail premises is prohibited by
California Penal Code section 647 and that patrons must
immediately leave the premises and not consume cannabis in the
vicinity and/or on the property or in the parking lot.
c. A warning that patrons and/or employees may be subject to
prosecution under federal cannabis laws, if applicable.
d. That the use of cannabis may impair a person’s ability to drive a
motor vehicle or operate machinery and that doing so is illegal.
6. No one under the age of twenty-one (21) shall be allowed to enter the
premises of a cannabis business unless the business holds a retail
medical cannabis license (M-license) issued by the State.
7. No person shall be permitted to enter the premises without government-
issued identification, and cannabis goods may not be provided to any
person, whether by purchase, trade, gift, or otherwise, who does not
possess a valid government-issued identification and who does not meet
the age requirements of this Chapter.
8. Electronic age verification device required. Proof of age of every person
other than employees entering the business shall be verified with an
electronic age verification device, prior to entry of the retail area or delivery
to that person. The electronic age verification device may be mobile or
fixed, and shall be able to retain a log of all scans that includes the
following information: date, time, and age. Said log shall be kept for a
minimum of one hundred eighty (180) business days and all records shall
be made available to the City Manager upon request.
9. Point-of-sale tracking required. The business shall facilitate the sale,
making available, furnishing and/or delivery of cannabis goods with a
technology platform that uses point-of-sale technology to track, and
database technology to record and store, the following information for
each transaction involving the exchange of cannabis goods between the
business and consumer:
a. The date and time of transaction.
b. The first name and employee number of the employee who
processed the sale of cannabis goods on behalf of the business.
c. A list of all the cannabis goods purchased, including the quantity
purchased.
d. The total amount paid for the sale, including the individual prices paid
for cannabis or cannabis products purchased, and any amounts paid
for taxes.
10. Cannabis retail businesses shall also record on the video surveillance
system point-of-sale areas and areas where cannabis goods are displayed
for sale.
11. Adequate signage shall clearly state who has inspected any cannabis
product for pesticides, or other regulated contaminants, distributed at this
location.
12. Shipments of cannabis goods may only be accepted during regular
business hours.
13. Inventory shall be secured using a lockable storage system during non-
business hours.
14. No cannabis product shall be visible from the exterior of the business.
15. All required labelling shall be maintained on all product, as required by State
law, at all times.
16. A permitted commercial cannabis retail business shall have one hundred
eighty (180) days after permit issuance by the city to commence operations,
after which the permit shall be void and of no further force and effect. A
permitted commercial cannabis retail business that ceases to operate for
more than ninety (90) calendar days after commencing operations shall be
deemed “abandoned” and the permit shall be forfeited. A permitted
commercial cannabis business may temporarily suspend operations for a
period of time as may be reasonably required to affect upgrades,
modifications, repairs, or other property issue mitigations as approved by
the director or city manager. For the purposes of this subsection, “operate”
shall mean by the end of the one hundred eighty (180) day period.
17. Obtain and maintain at all times during the term of the permit the insurance
required pursuant to subsection (f) of this section in the minimum amounts
of two million dollars ($2,000,000.00), and enter into an agreement
approved by the city attorney to defend, with attorneys of city’s choosing,
indemnify, release and hold harmless the city, its city council, boards,
commissions, officers and employees from and against any and all claims,
demands, obligations, damages, actions, causes of action, suits, losses,
judgments, fines, penalties, liabilities, costs and expenses (including,
without limitation, attorneys’ fees, disbursements and court costs) of every
kind and nature whatsoever which may arise from or in any manner relate
(directly or indirectly) to the permittee or the permittee’s activities. This
indemnification shall include, but not be limited to, damages awarded
against the city, if any, costs of suit, attorneys’ fees, and other expenses
incurred in connection with such claim, action, or proceeding whether
incurred by the permittee, city, and/or the parties initiating or bringing such
proceeding, and shall not be limited by the types and/or amounts of
insurance required herein;
18. For an applicant with two or more employees, provide a notarized statement
that the applicant will enter into, or demonstrate that it has already entered
into, and abide by the terms of a labor peace agreement as otherwise
required by Business and Professions Code section 26105.5.
(i) Additional operating requirements for retail sale (non-storefront) delivery
businesses. In addition to every other requirement of this section, except only for
subsection (h)(1) through (5) and (10) (retail sale, store-front), every business that
sells and/or delivers cannabis as a non-store front retailer shall comply with the
following requirements:
1. Commercial cannabis retail deliveries may be made only from a commercial
cannabis retail business permitted by the City in compliance with this
chapter, and in compliance with all State regulations.
2. All employees who deliver cannabis shall have valid identification and a
copy of the retail business' cannabis business permit and State license at
all times while making deliveries.
3. All commercial cannabis retail businesses shall maintain proof of vehicle
insurance for any and all vehicles being used to transport cannabis goods
as required by State law.
4. Deliveries may only take place during normal business hours of the
commercial cannabis retail business.
5. During delivery, the delivery employee shall maintain a physical or
electronic copy of the delivery request and shall make it available upon
request by the licensing authority and law enforcement officers. The delivery
request documentation shall comply with State law.
6. A licensed delivery employee shall not leave the State of California while
possessing cannabis products while performing his or her duties for the
cannabis retailer.
7. A commercial cannabis retail business shall maintain a list of all deliveries,
including the address delivered to, the amount and type of product
delivered, and any other information required by the State.
8. A manifest with all information required in this section shall accompany any
delivery person at all times during the delivery process and delivery hours.
9. Any delivery method shall be made in compliance with State law, as
amended, including use of a vehicle that has a dedicated GPS device for
identifying the location of the vehicle (cell phones and tablets are not
sufficient).
10. Each delivery request shall have a receipt prepared by the commercial
cannabis retail business with the following information:
a. Name and address of the commercial cannabis retail business.
b. The name of the employee who delivered the order.
c. The date and time the delivery request was made.
d. The complete delivery addresses.
e. A detailed description of the cannabis goods requested for delivery
including the weight or volume, or any accurate measure of the
amount of cannabis goods requested.
f. The total amount paid for the delivery including any fees or taxes.
g. At the time of the delivery, the date and time delivery was made,
and the signature of the person who received the delivery.
h. No cannabis delivery vehicle shall display signs, decals or any
other form of advertisement.
i. Inspections by an authorized City representative may be conducted
anytime during regular business hours.
11. Delivery must be made to a physical address that is not on publicly owned
land, a school, a day care, or a youth center.
12. The delivery employee shall not carry cannabis goods valued in excess of
$5,000 at any time with no more than $3,000 of cannabis goods that are not
already part of a customer order that was processed prior to leaving the
premises.
13. Delivery must be made in person by a direct employee of the licensed
retailer. An independent contractor, third-party courier service, or an
individual employed through a staffing agency would not be considered
directly employed by the licensed retailer.
9-496. Cannabis employees.
(a) Any person who is an employee or who otherwise works within a cannabis
business must be legally authorized to do so under applicable state law.
(b) No cannabis business or owner thereof may employ any person who has
been convicted of a felony within the past seven (7) years, unless that felony
has been dismissed, withdrawn, expunged or set aside pursuant to Penal
Code section 1203.4, 1000 or 1385, or who is currently on probation or parole
for the sale, distribution, possession or manufacture of a controlled
substance. Exempted from this prohibition is a conviction for a felony
involving cannabis and/or marijuana for which the underlying cannabis or
marijuana offense has subsequently been designated a misdemeanor or
infraction or decriminalized pursuant to the provisions of the Control,
Regulate and Tax Adult Use of Marijuana Act or federal law.
(c) All employees must wear an identification badge while on the premises of the
business, in a format authorized by the city manager.
9-497. Promulgation of administrative regulations.
(a) The city manager is also authorized to establish any additional administrative
rules, regulations, policies, procedures and/or standards governing the
issuance, denial or renewal of cannabis business permits, or concerning any
other subject necessary to carry out the purposes of this chapter.
(b) Regulations promulgated by the city manager shall become effective upon
the date of publication. Cannabis businesses shall be required to comply with
all state and local laws and regulations, including, but not limited to, any rules,
regulations policies, procedures and/or standards adopted by the city
manager.
(c) Such administrative rules, regulations and/or standards may include
establishing standards and timing for application processing, including but not
limited to providing priority for existing licensees in good standing.
9-498. Inspection and enforcement.
(a) The city manager is charged with enforcing the provisions of the Costa Mesa
Municipal Code, or any provision thereof, and may enter the location of a
cannabis business at any time during the hours of operation without notice,
and inspect the location of any cannabis business as well as any recordings
and records required to be maintained pursuant to this title or under
applicable provisions of state law.
(b) It is unlawful for any person having responsibility for the operation of a
cannabis business, to impede, obstruct, interfere with, or otherwise not to
allow, the city to conduct an inspection, review or copy records, recordings or
other documents required to be maintained by a cannabis business under
this chapter or under state or local law. It is also unlawful for a person to
conceal, destroy, deface, damage, or falsify any records, recordings or other
documents required to be maintained by a cannabis business under this
chapter or under state or local law.
9-499. Violations.
(a) Violations declared a public nuisance. Each and every violation of the
provisions of this chapter is hereby deemed unlawful and a public nuisance.
(b) Each violation a separate offense. Each and every violation of this chapter
shall constitute a separate violation and shall be subject to all remedies and
enforcement measures authorized by the Costa Mesa Municipal Code.
Additionally, as a nuisance per se, any violation of this chapter shall be
subject to injunctive relief, any permit issued pursuant to this chapter being
deemed null and void, disgorgement and payment to the city of any monies
unlawfully obtained, costs of abatement, costs of investigation, attorney fees,
and any other relief or remedy available at law or in equity. The city may also
pursue any and all remedies and actions available and applicable under state
and local laws for any violations committed by the cannabis business or
persons related to, or associated with, the cannabis activity. Additionally,
when there is determined to be an imminent threat to public health, safety or
welfare, the city manager, or the chief of police, may take immediate action
to temporarily suspend a cannabis business permit issued by the city,
pending a hearing before the city council.
(c) Criminal penalties. Each and every violation of the provisions of this chapter
may be prosecuted as a misdemeanor and upon conviction be subject to a
fine not to exceed one thousand dollars ($1,000.00) or imprisonment in the
County Jail for a period of not more than twelve (12) months, or by both such
fine and imprisonment. Each day a violation is committed or permitted to
continue shall constitute a separate offense.
(d) Remedies cumulative and not exclusive. The remedies provided herein are
not to be construed as exclusive remedies. The city is authorized to pursue
any proceedings or remedies provided by law.
Section 4: Environmental Compliance. This Ordinance has been reviewed for
compliance with the California Environmental Quality Act (CEQA), the CEQA guidelines,
and the City’s environmental procedures, and has been found to be exempt pursuant to
CEQA Guidelines Section 15061(b)(3) (General Rule) and Section 15308 (Class 8,
Actions by Regulatory Agencies for the Protection of the Environment) because a
recommendation is not a final action and the recommended ordinance will not have a
significant effect on the environment. The Code Amendment is also exempt pursuant to
CEQA Guidelines Section 15301 (Class 1, Existing Facilities), Section 15303 (Class 3,
New Construction or Conversion of Small Structures), and Section 15332 (Class 32, In-
fill Development Projects) because future construction for retail cannabis businesses will
largely be within existing buildings for interior tenant improvements that will also not have
significant effect on the environment.
Section 5: Inconsistencies. Any provision of the Costa Mesa Municipal Code or
appendices thereto inconsistent with the provisions of this Ordinance, to the extent of
such inconsistencies and no further, is hereby repealed or modified to that extent
necessary to affect the provisions of this Ordinance.
Section 6: Severability. If any chapter, article, section, subsection, subdivision,
sentence, clause, phrase, word, or portion of this Ordinance, or the application thereof to
any person, is for any reason held to be invalid or unconstitutional by the decision of any
court of competent jurisdiction, such decision shall not affect the validity of the remaining
portion of this Ordinance or its application to other persons. The City Council hereby
declares that it would have adopted this Ordinance and each chapter, article, section,
subsection, subdivision, sentence, clause, phrase, word, or portion thereof, irrespective
of the fact that any one or more subsections, subdivisions, sentences, clauses, phrases,
or portions of the application thereof to any person, be declared invalid or unconstitutional.
No portion of this Ordinance shall supersede any local, state, or federal law, regulation,
or codes dealing with life safety factors.
Section 7: Effective Date. This Ordinance shall take effect and be in full force thirty
(30) days from and after the passage thereof, and prior to the expiration of fifteen (15)
days from its passage shall be published once in the ORANGE COAST DAILY PILOT, a
newspaper of general circulation, printed and published in the City of Costa Mesa or, in
the alternative, the City Clerk may cause to be published a summary of this Ordinance
and a certified copy of the text of this Ordinance shall be posted in the office of the City
Clerk five (5) days prior to the date of adoption of this Ordinance, and within fifteen (15)
days after adoption, the City Clerk shall cause to be published the aforementioned
summary and shall post in the office of the City Clerk a certified copy of this Ordinance
together with the names and member of the City Council voting for and against the same.
APPROVED AND ADOPTED on this ______ day of ___________, 2021.
________________________
John Stephens, Mayor
ATTEST:
_________________________
Brenda Green
City Clerk
I, BRENDA GREEN, CITY CLERK of the City of Costa Mesa, California, do hereby certify
that the foregoing urgency ordinance was regularly introduced and adopted by the City
Council of the City of Costa Mesa, California, at a regular meeting thereof held on the ___
day of __________, 2021, by the following vote of the City Council:
AYES:
NOES:
ABSENT:
ABSTAIN:
APPROVED AS TO FORM:
____________________________
Kimberly Hall Barlow
City Attorney
ARTICLE 21. LOCATION OF CANNABIS DISTRIBUTING, MANUFACTURING, RESEARCH AND
DEVELOPMENT, TESTING LABORATORIES, RETAIL STOREFRONT AND RETAIL NON-
STOREFRONT USES
13-200.90. Purpose.
The purpose of this article is to regulate the location of and standards for cannabis distributing
facilities, manufacturing sites, research and development laboratories, testing laboratories, retail
storefront and retail non-storefront uses in order to promote the health, safety, morals and general
welfare of the residents and the businesses within the city by maintaining local control over the
ability to authorize and regulate the location of cannabis businesses.
13-200.91. Applicability.
(a) Nothing in this article is intended, nor shall it be construed, to burden any defense to
criminal prosecution under the Compassionate Use Act of 1996.
(b) All the provisions of this article shall apply to all property, public and private, within
the city.
(c) All the provisions of this article shall apply indoors and outdoors.
(d) Unless otherwise provided herein or in this title, the terms used in this article shall
have the meaning ascribed to them in Title 9, Chapter VI of this Code.
13-200.92. Cannabis distributing facilities, manufacturing sites, research and development
laboratories, and testing laboratories.
(a) Cannabis distribution, manufacturing, research and development and testing is
prohibited in all zone districts within the city, except for those portions of the
manufacturing park (MP) and planned development industrial (PDI) zones that are located
both north of South Coast Drive and west of Harbor Boulevard, excluding any portion of
the South Coast Collection (the “Green Zone”).
(b) A conditional use permit shall be required and may be issued to allow the location of
any business engaged in the distribution, manufacturing, researching and developing, or
testing of cannabis in the MP or PDI zones pursuant to subsection (a) of this section, subject
to the following conditions:
(1) The requirements of Chapter III of this title have been met;
(2) The findings for granting a conditional use permit in accordance with section 13-
29(g) are met;
(3) The applicant obtains a cannabis business license pursuant to Chapter VI of Title
9 of this Code; and
(4) The use is conducted in compliance with all applicable state and local laws.
(c) No person shall engage in any use set forth in this article unless that use is specifically
authorized by Chapter VI of Title 9 of this Code.
13-200.93. Cannabis retail storefront and non-storefront uses.
(a) Cannabis retail storefront uses are prohibited in all zone districts within the city, except
for the commercial zone districts.
Attachment 3
(b) Cannabis retail non-storefront uses are prohibited in all zone districts within the city,
except for the commercial zone districts and within the Green Zone.
(c) The following planning application shall be required for cannabis retail uses:
(1) A conditional use permit shall be required for retail storefronts and non-
storefronts; and
(2) An amendment to the approved conditional use permit shall be required for
existing licensed cannabis distribution or manufacturing businesses to operate a
retail non-storefront under the existing business and within the same licensed
premise. The amendment shall be processed as a minor conditional use permit.
(d) A conditional use permit may be issued to allow the location of a retail cannabis use
pursuant to subsections (a) and (b) of this section, subject to the following conditions:
(1) The requirements of Chapter III of this title have been met;
(2) The findings for granting a minor or conditional use permit pursuant to section
13-29(g) are met;
(3) The applicant obtains a cannabis business license for the location pursuant to
Chapter VI of Title 9 of this Code; and
(4) The use is conducted in compliance with all applicable state and local laws.
(e) No cannabis retail storefront use shall be located:
(1) Within one-thousand (1,000) feet from a K-12 school, playground, childcare or
daycare center, or homeless shelter, or within six-hundred (600) feet from a youth
center, that is in operation at the time of submission of a completed Cannabis
Business Permit application;
(2) Within five-hundred (500) feet of the permitted location of another cannabis retail
storefront use that exists at the time of submission of a completed Cannabis
Business Permit application;
(3) All distances shall be measured in a straight line from the closest property line of
the lot premises where the cannabis retail use is to be located to the closest
property line of a K-12 school, playground, childcare or daycare center, homeless
shelter or youth center or licensed cannabis retail storefront;
i. For purposes of this sub-sub-section, the property line of a playground
shall be a thirty (30) foot radius from the exterior physical boundaries of
the playground equipment area. shall constitute the property line for
purposes of this sub- section.
(4) All distances shall be measured without regard to the boundaries of the city and
and/or intervening structures or other barriers, except only for properties separated
by the Interstate 405 freeway for which the distances set forth in subsections (1)
and (2) shall be measured as the most direct pedestrian route between properties;
(5) At a property as for which the zoning administrator, director or planning
commission determines, based on a preponderance of the evidence, that
unpermitted and/or illegal cannabis activity involving sales, delivery and/or
dispensing has taken place at any time in the 365180 days preceding an application
under this Article. If an unpermitted and/or illegal cannabis activity has existed on
a property no cannabis business may be permitted on that property unless 365 days
has elapsed since that unpermitted and/or illegal cannabis activity has vacated the
property, and the owner of that property has The zoning administrator, director or
planning commission may grant relief to an otherwise qualified applicant from the
prohibitions of sub-section (e)(5) for good cause based on a finding supported by a
preponderance of the evidence that:
(6) The unpermitted use has ceased for a period of not less than 180 days;
(7) The applicant is a purchaser of the property and not otherwise ineligible or the
applicant is leasing the property from a purchaser or owner who is not ineligible to
hold a cannabis business permit pursuant to section 9-490; and
The city has been reimbursed compensated the City for any and all expenditure of
public funds and resources, including all costs, expenses (including but not limited
to the salaries of peace and/or code enforcement officers) and/or attorney’s fees,
incurred in investigating, abating or attempting to abate the unpermitted use or
uses, whether or not any type of civil, criminal or administrative proceedings have
been commenced against the property, provided however if the owner of the
property is required to evict that use, the 365180 days shall begin to run from the
date of the filing of an unlawful detainer complaint, in which case the a permit
may be issued after the 365180 days had elapsed and the that use is no longer
occupying the property.
(6) A determination and/or finding under sub-sections (e)(4)(5) and/or (6) is subject to
the appeal provisions of Chapter IX of Title 2 of this Code.
(f) Retail storefront uses shall be subject to the following development standards in
addition to those contained in Chapter VI of Title 9:
(1) Opaque window coverings unless required by the City for security purposes are
prohibited;
(2) Permanent security or safety bars shall not be placed on any interior or exterior
windows or door, unless required by the City for security purposes;
(3) Directional signage to the use including but not limited to A-frame signs,
sandwich board signs, banners, or flags are prohibited;
(4) No use shall advertise by having a person holding a sign and advertising the
business to passersby, whether such person is on the premises of the commercial
cannabis business or elsewhere including, but not limited to, the public right-of-
way;
(5) Uses shall comply with the landscaping requirements set forth in Chapter VII of
this title including bringing the site landscaping into conformance when feasible
as determined by the director;
(6) Parking requirements shall be subject to Section 13-89;
(7) The hours of operation may be established as part of the planning application
subject to the final review authority and may be more restrictive than those set
forth in Chapter VI of Title 9. Modification of operation hours when established
as part of the planning application shall be subject to an amendment of the
planning application;
(8) Drive-through services or walk-up window services are prohibited;
(9) Outdoor seating or patio areas are prohibited;
(10) Special events that include live entertainment, dancing, and/or amplified music, or
that are otherwise visible and/or audible from the public right-of-way, are
prohibited;
(11) All cannabis products shall be secured after business hours in a locked container
under 24-hour video surveillance; and
(12) For uses within two hundred (200) feet of a residential zone, all exterior lighting
shall be shielded and/or directed away from residential areas. In addition, trash
facilities shall be screened from view and designed and located appropriately to
minimize potential noise and odor impacts to adjacent residential areas.
(g) Non-storefront uses shall be subject to the following development standards in addition
to those contained in Chapter VI of Title 9:
(1) Uses may operate independently from a retail storefront or as a part of, and in
conjunction with, a permitted storefront, distribution, or manufacturing facility;
(2) Parking requirements shall be subject to Section 13-89 and shall also include
sufficient parking spaces for delivery vehicles;
(3) All deliveries to customers shall be completed by 10:00 p.m.; and
(4) The general public shall not be permitted to enter the premises of a non-storefront
retail use.
(h) Except as specifically authorized in this article, all other cannabis retail uses such as
but not limited to lounges and cafes are expressly prohibited in the city.
(i) No person shall engage in any use set forth in this article unless that use is specifically
authorized by Chapter VI of Title 9 of this Code.
(j) Any cannabis use, including but not limited to those involving sale, delivery and/or
dispensing, that is not permitted, licensed and otherwise in full compliance with all
applicable provisions of this Code and state and local law, shall not be considered a
legally non-conforming use pursuant to, and notwithstanding any contrary provisions
of, Chapter IX of this title.
13-200.94. Declaration of public nuisance.
Any use, structure, or property that is altered, enlarged, erected, established, maintained, moved,
or operated contrary to the provisions of this article, is hereby declared to be unlawful and a
public nuisance and may be abated by the city through civil and/or administrative proceedings by
means of a restraining order, preliminary or permanent injunction, or in any other manner
provided by law for the abatement of such nuisances.
13-200.95. Violations.
Violations of this article shall be punishable pursuant to the provisions of section 13-16 in
addition to any other remedy available at law or in equity.
CHAPTER IV. CITYWIDE LAND USE MATRIX
TABLE 13-30
CITY OF COSTA MESA LAND USE MATRIX
ZONES
LAND USES R1
R2-
MD
R2-
HD R3 AP CL C1 C2
C1-
S1 TC1 MG MP
PDR-
LD1
PDR-
MD1
PDR-
HD1
PDR-
NCM1 PDC1 PDI1 I&R1
I&R-
S1
I&RM
LT1 P
INSTITUTIONAL AND RECREATIONAL USES
31a. Marijuana
and/or medical
• • • • • • • • • • • • • • • • • • • • • •
marijuana
cultivation
31b. Cannabis
and/or marijuana
distributer
• • • • • • • • • • • C9 • • • • • C9 • • •
31c. Cannabis
and/or marijuana
manufacturer or
processor
• • • • • • • • • • • C9 • • • • • C9 • • •
31d. Cannabis
and/or marijuana
retail sales:
storefront
• • • • • C9 C9 C9 C9 C9 • • • • • • • • • • •
31e. Cannabis
and/or marijuana
retail sales: non-
storefront
(deliveries)
• • • • • C9 C9 C9 C9 C9 • C9 • • • • • C9 • • • •
31f. Cannabis
and/or marijuana
research and
development
and/or testing
laboratories
• • • • • • • • • • • C9 • • • • • C9 • • • •
1 Uses proposed in this zone are subject to verification of consistency with the adopted master plan. Uses not specified in the
master plan, could be allowed, subject to the review process indicated in this matrix, if the proposed use is determined to be
compatible with the adopted master plan. Residential uses shall not be permitted on any site or parcel of land on which
residential uses are expressly prohibited by the general plan.
2 This use is subject to the requirements of the referenced Municipal Code article or section.
3 If residential uses exist, accessory uses shall be permitted.
4 For the purposes of this table, the symbols in the non-shaded areas shall have the following meaning: C—Conditional Use
Permit; MC—Minor Conditional Use Permit; P—Permitted; •—Prohibited; and S—Special Use Permit.
5 Six-hundred--fifty-foot separation required between sober living homes, or from state licensed alcohol or drug abuse
recovery or treatment facilities. CMMC 13-311(a)(10)(i).
6 Subject to the separation requirement set forth in sections 13-322(a)(3) and 13-323(b).
7 Small boardinghouses shall locate at least six hundred fifty (650) feet from any other small boardinghouse. Large
boardinghouses shall be located at least one thousand (1,000) feet away from any other boardinghouse.
8 Uses prohibited in the base zoning district of a mixed-use overlay zone shall also be prohibited in the overlay zone.
9 Prohibited at the SoCo property, 3303 through 3323 Hyland Ave.
10 Emergency shelters located on sites owned, controlled, and/or operated by the city in the MP and/or the PDI zone are a
permitted use and the standards in section 13-200.79(1), (2), (4), (8), (10) and (13) do not apply to such
9-29.5. Cannabis tax.
Notwithstanding any other provision of this Code, every person engaged in, managing,
conducting, or carrying on any cannabis business defined in Chapter VI of this title, or
any other marijuana and/or cannabis business, shall pay an annual business tax as
follows:
(a) Every person who is lawfully engaged in, managing, conducting, or carrying
on a business as a cannabis distributor, manufacturer, and/or research and
development laboratory, as set forth in Section 9-486(a), shall pay an
annual business tax of one (1) percent based on the gross receipts of that
business.
(b) Every person who is lawfully engaged in, managing, conducting, or carrying
on a business as a cannabis testing laboratory, as set forth in Section 9-
486(a), shall pay no annual business tax.
(c) Every person who is engaged in, managing, conducting, or carrying on a
business as a cannabis store-front retailer, as set forth in Section 9-486(a),
and/or who otherwise sells, dispenses and/or furnishes cannabis anywhere
within the city, shall pay an annual business tax of seven (7) percent based
on the gross receipts of that business.
(d) Every person who is engaged in, managing, conducting, or carrying on a
business as a cannabis non-store front retailer, as set forth in Section 9-
486(a), and/or who otherwise delivers cannabis anywhere within the city,
shall pay an annual business tax of seven (7) percent based on the gross
receipts of that business, subject to the applicable provisions of section 9-
40.
(e) Every cannabis business that is engaged as a distributor, manufacturer, or
research and development laboratory, that is also engaged in retail sales or
delivery of the same cannabis products, shall pay the business tax as set
forth in 9-29.5 subsections (c) and (d), as applicable, for the retail sale or
delivery of the same cannabis and cannabis products and is not required to
pay business taxes set forth in 9-29.5(a). The operator has the burden of
proving that the cannabis or cannabis products involved in the distribution,
manufacturing, and/or research and development are the same.
(f) The proceeds of the tax set forth in sub-sections (a), (c), (d), and (e) shall
be subject to an annual audit as scheduled by the City Manager or Director
of Finance.
(g) One half of one percent of the proceeds of the tax set forth in sub-sections
(c) and (d) shall be directed toward the implementation of the Cultural and
Attachment 4
Arts Master Plan and one half of one percent shall be directed towards the
implementation of a first time homebuyer program for current residents of
the City, former residents who were raised in the City and/or who graduated
from the Newport Mesa Unified School District.
9-116. Issuing officer.
“Issuing officer” shall mean the city council of Costa Mesa, the city manager, the Director
of Finance, the fire chief, the chief of police, or the director of Economic and Development
Services, as applicable, including such person’s designee.
9-119. Revocation or suspension of permits.
A business tax registration certificate or any other permit issued under this title may be
revoked or suspended on the following grounds:
(a) Where said issuing officer has found and determined that the preservation
of the public health, safety, peace and welfare necessitate revocation of
said business tax registration certificate or permit.
(b) Where the applicant or permittee has violated any applicable provisions of
this title, other provisions of this Code as defined in section 1-35, order of
the Health Officer or the Emergency Services Director and/or any other
provision of law.
(c) Where a business tax registration certificate or permit has been granted on
false or fraudulent evidence, testimony, or application.
(d) Where the applicant or permittee has violated the terms and provisions of
said business tax registration certificate or permit.
Exception. Notwithstanding the foregoing or any other provision of this title to the contrary,
licenses issued to chiropractors, laboratory technicians, dentists, medical doctors,
opticians, physical therapists, nurses, psychologists, pharmacists, veterinarians,
accountants, advertising architects, landscape architects, building designers, attorneys,
barbers, engineers, collection agencies, contractors, cosmetologists, private detectives,
funeral directors, shorthand reporters, structural pest control operations, land surveyors,
ship brokers, cleaners and dyers, electronic repair dealers, real estate agents and
brokers, marriage counselors, auto dealers, boxers and wrestlers, furniture and bedding
dealers and manufacturers, manufacturers of paints, petroleum activities, dealers in
secondhand goods, or any other business, profession or trade where the determination
of issuance or revocation of the right of any person to engage in such business,
profession, or trade is solely vested in a state board or agency and is not otherwise
regulated by this code, shall be issued upon filing the requisite application and payment
of the requisite fees and shall not be subject to revocation or suspension except any such
business tax registration certificate may be revoked for nonpayment of fees or upon
revocation of the state board or agency license.
9-120. Permittee entitled to hearing prior to revocation or suspension.
(a) No business tax registration certificate or permit shall be revoked or suspended
until said permittee has had an opportunity for a hearing before the issuing
officer.
(b) Written notice of the revocation or suspension, the reasons therefore and the
requirement to request a hearing shall be given by certified mail to a certificate
holder or permittee’s last known mailing address or by such other method
reasonably calculated to provide notice.
(c) The revocation or suspension shall be final and effective after ten (10) calendar
days following the date of mailing set forth in sub-section (b), unless the
certificate holder or permittee files an application for a hearing with the city clerk
prior to such effective date. There shall be no cost to the certificate holder or
permittee for such a hearing under this section.
(d) Except as otherwise provided in sub-section (e) the hearing shall be
commenced within 30 calendar days of the fling of an application for hearing.
Hearings conducted pursuant to this section shall be open to the public, shall
not be conducted according to the technical or traditional rules relating to
evidence, and shall provide, personally or by counsel or both, an opportunity
for certificate holder or permittee to defend and present evidence on their
behalf. At least ten calendar days prior to the hearing, certificate holder or
permittee shall be provided with any documentation upon which the revocation
or suspension is based. Following the close of the hearing the issuing officer
shall within 30 days render a written decision whether or not to impose
revocation or suspension.
(e) Notwithstanding the foregoing, the city manager or director of finance may
suspend, pending a hearing, any business tax registration certificate or permit
where it has been determined by said official that an immediate suspension of
the business tax registration certificate or permit is necessary for the protection
of the public health, safety, peace and welfare. In the event of such a
suspension, the director of finance shall, within twelve (12) hours after said
suspension, cause to be served upon said business or permittee a written
statement containing the grounds for said suspension, any written
documentation upon which the revocation is based and a notice of hearing to
show cause before the issuing officer why said permit should not be
permanently revoked, which said hearing shall be commenced no later than
five (5) calendar days following the service of said notice unless the parties
thereto agree otherwise, and thereafter followed by a written decision pursuant
to sub-section (d).
9-121. Appeal from the decision of the issuing officer.
Appeals from decision of the hearing officer provided for herein shall be made in
accordance with the procedure of Chapter IX of Title 2 of this Code.
CHAPTER VI. CANNABIS BUSINESS PERMITS
9-481. Purpose and intent.
It is the purpose and intent of this chapter to regulate the distributing, manufacturing,
processing, research and development, retail sale, testing and transporting of cannabis
and cannabis-related products in a manner which is responsible, which protects the
health, safety, and welfare of the residents of Costa Mesa, and to enforce rules and
regulations consistent with state law. In part to meet these objectives, a permit shall be
required in order to own and/or to operate a cannabis business within the city. Nothing in
this chapter is intended to authorize the possession, use, or provision of cannabis for
purposes which violate state or federal law. The provisions of this chapter are in addition
to any other permits, licenses, and approvals which may be required to conduct business
in the city, and are in addition to any permits, licenses and approvals required under state
law.
9-482. Legal authority.
Pursuant to Sections 5 and 7 of Article XI of the California Constitution and the provisions
of Division 10 of the Business and Professions Code, the city is authorized to adopt
ordinances that establish standards, requirements and regulations for local licenses and
permits for cannabis and cannabis-related activity.
9-482.5 Authority of the City Manager
The City Manager is authorized to make reasonable rules, policies, and procedures
consistent with the intent and spirit of this Chapter as may be necessary to administer
and enforce the provisions of this Chapter and any other ordinances, regulations or laws
relating to and affecting the permitting and operations of commercial cannabis
businesses.
The City Manager is authorized to make reasonable rules, policies, and procedures
consistent with the intent and spirit of this Chapter concerning the applications, the
application process, the information required of applicants, the application procedures,
and the administration and procedures to be used and followed in the application process
for permit applications and requests for permit changes or modifications pursuant to this
Chapter, and the implementation and administration of social equity programs.
9-483. Cannabis business activities prohibited unless specifically authorized by
this chapter.
Except as specifically authorized in this chapter, the manufacture, processing, storing,
laboratory testing, labeling, transporting, dispensing, furnishing, distribution, delivery, or
sale of cannabis or a cannabis product is expressly prohibited in the city.
9-484. Compliance with laws.
It is the responsibility of the owners and operators of the cannabis business to ensure
that it is, at all times, operating in a manner compliant with all applicable state and local
laws, and any regulations promulgated thereunder.
9-485. Definitions.
Unless otherwise defined in this chapter or in chapter I of Title 13, the words used in this
chapter shall have the same definitions ascribed to them in Division 10 of the Business
and Professions Code or the definitions of the Health and Safety Code applicable to
school, child daycare and, playground and emergency shelter. Any reference to California
statutes includes any regulations promulgated thereunder and is deemed to include any
successor or amended version of the referenced statute or regulatory provision.
Cannabis means all parts of the Cannabis sativa Linnaeus, Cannabis indica, or Cannabis
ruderalis, whether growing or not; the seeds thereof; the resin, whether crude or purified,
extracted from any part of the plant; and every compound, manufacture, salt, derivative,
mixture, or preparation of the plant, its seeds, or resin. “Cannabis” also means the
separated resin, whether crude or purified, obtained from marijuana. “Cannabis” also
means marijuana as defined by section 11018 of the California Health and Safety
Code as enacted by Chapter 14017 of the Statutes of 1972. “Cannabis” does not include
the mature stalks of the plant, fiber produced from the stalks, oil or cake made from the
seeds of the plant, any other compound, manufacture, salt, derivative, mixture, or
preparation of the mature stalks (except the resin extracted therefrom), fiber, oil, or cake,
or the sterilized seed of the plant which is incapable of germination. For the purpose of
this chapter, “cannabis” does not mean industrial hemp as that term is defined by section
81000 of the California Food and Agricultural Code or section 11018.5 of the
California Health and Safety Code.
Cannabis business permit means a regulatory permit issued by the city pursuant to this
chapter to a cannabis business, and is required before any cannabis activity may be
conducted in the city.
Cannabis goods means cannabis and/or cannabis products.
Cannabis product or manufactured cannabis product or product means cannabis that
has undergone a process whereby the plant material is transformed into a concentrate
for internal consumption or topical application, including, but not limited to, concentrated
cannabis, an edible cannabis product, or a topical cannabis product containing cannabis
or concentrated cannabis in combination with other ingredients.
Caregiver or primary caregiver has the same meaning as that term is defined in section
11362.7 of the California Health and Safety Code.
City manager shall mean the city manager of the city or designee.
Director shall mean the city’s Director of the Economic and Development Services
department or designee, unless otherwise specified.
Dispensing means any activity involving the retail sale of cannabis or cannabis products.
Distributor means a person or entity that engages in distribution. The direct and/or retail
sale, distribution, or furnishing of any cannabis or cannabis product to any consumer or
end user by a distributor is expressly prohibited, unless otherwise authorized pursuant to
this chapter.
Edible cannabis product means manufactured cannabis that is intended to be used, in
whole or in part, for oral human consumption including, but not limited to, chewing gum,
but excluding products set forth in Division 15 (commencing with Section 32501) of the
California Food and Agricultural Code. An edible cannabis product is not considered
food as defined by California Health and Safety Code Section 109935 or a drug as
defined by California Health and Safety Code Section 109925.
Free sample means any amount of cannabis goods provided to a patron of a business
or member of the public without cost or payment or exchange for any other thing of
value.
Green Zone means those portions of the manufacturing park (MP) and planned
development industrial (PDI) zones that are located both north of South Coast Drive and
west of Harbor Boulevard, excluding any portion of the South Coast Collection.
Homeless shelter has the same meaning as emergency shelter.
Labor Peace Agreement has the same meaning set forth in Business and Professions
Code section 26001.
Manufacturing site means a location where cannabis products are manufactured.
Marijuana means “cannabis,” as that term is defined in this chapter.
Marijuana activity and/or cannabis activity includes manufacture, processing, laboratory
testing, research and development, transporting, delivery, dispensing, distribution,
furnishing, giving away or sale or any other activity involving cannabis or a cannabis
product.
Marijuana business and/or cannabis business means any business or operation which
engages in any marijuana or cannabis activity.
Marijuana business permit has the same meaning as cannabis business permit.
Patient or qualified patient shall have the same definition as California Health and Safety
Code section 11362.7 et seq., as it may be amended, and which means a person who is
entitled to the protections of California Health and Safety Code section 11362.5. For
purposes of this chapter, a qualified patient shall include a person with an identification
card as that term is defined by California Health and Safety Code section 11362.7 et seq.
Person with an identification card shall have the meaning given that term by
California Health and Safety Code section 11362.7.
Playground shall mean a public playground located in a city park.
Premises shall have the same meaning as set forth in Business and Professions Code
section 26001 sub-section (ap) for purposes of measuring the required distance from
retail storefront uses to those uses set forth in section 13-200.93(e)(1).
Processing and processor shall have the same meaning as manufacturing and
manufacturer, respectively.
Property shall mean any single development lot that has been subdivided bearing its own
assessor’s parcel number or with an approved subdivision map or condominium map
unless the context clearly indicates a different meaning.
Research and development laboratory means a facility, entity, or site in the city that
performs research into and/or the development of cannabis or cannabis products, where
cannabis in any amount is located on-site, and that is both of the following:
1. Accredited by an accrediting body that is independent of all other persons
involved in the cannabis industry in the state.
2. Registered with the State Department of Public Health, and is owned and
operated by a person issued a valid cannabis business permit for laboratory
testing from the city and is currently in compliance with all applicable state
and local laws and regulations pertaining to the cannabis business and
cannabis activities.
South Coast Collection or SoCo means all properties located at 3303 through 3323,
inclusive, Hyland Avenue, in the City of Costa Mesa, commonly known as “SoCo” or
“SOCO.”
State means the State of California, including any of its departments, divisions, and/or
bureaus.
State license means a permit or license issued by the state to engage in cannabis activity.
Youth center means any public or private facility that is primarily used to host recreation
or social activities for minors, specifically private youth membership organizations or
clubs, social services teenage club facilities, video arcades where ten (10) or more games
or game machines or devices are operated or similar amusement park facilities, but does
not include dance studios, tutoring, martial arts studios or similar type of uses.
9-486. Type of authorized cannabis businesses permitted.
(a) One (1) or more of the following types of adult (A-license) and/or medical (M-
license) cannabis business may be permitted to operate within the city:
1. Cannabis distributor (includes license classification type 11);
2. Cannabis manufacturer (includes license classification type 6 and 7);
3. Cannabis testing laboratory (includes license classification type 8);
4. Cannabis retail - storefront (includes license classification type 10);
5. Cannabis retail - non-storefront (includes license classification type 9); and
6. Cannabis research and development laboratory.
(b) Businesses permitted pursuant to this chapter shall not engage in the retail sale,
delivery or dispensing of cannabis, cannabis product, hemp or hemp products
unless expressly permitted to do so pursuant to the terms of their cannabis
business permit.
(c) No person may engage in any type of cannabis business that is not specifically
authorized pursuant to this section and this code, including, but not limited to,
cultivating cannabis.
(d) The City Council may by resolution limit and/or restrict the number of cannabis
retail permits available for issuance and/or renewal.
9-487. Cannabis business permit required to engage in a cannabis business.
No person may engage in any cannabis business or in any cannabis activity within the
city including manufacturing, processing, laboratory testing, transporting, dispensing,
distribution, or sale of cannabis or a cannabis product unless the person: 1) has a valid
cannabis business permit from the city that authorizes the specific business and activity
at specific location; 2) has a valid business license issued to the entity that is listed on the
cannabis business permit; and 3) is currently in compliance with all other applicable state
and local laws and regulations pertaining to the cannabis business and cannabis activity.
9-487.5. Change in business name.
No operator shall operate, conduct, manage, engage in, or carry on a cannabis business
under any name other than the business name specified in the permit and/or any “doing
business as” or “DBA”, or “fictitious business name” or “FBN”, provided in the permit
application and/or business license. Proof of the “DBA” or “FBN” filing with the County
Clerk Recorder shall be required. Any approved changes and/or updates to the permit
may require payment of fees as set by resolution of the City Council.
9-488. Term of permit-Fees.
(a) A cannabis business permit shall be valid for two (2) years from the date of issue,
unless otherwise suspended or revoked, and may be renewed bi-annually
thereafter, provided the permittee is in compliance with the provisions of this
chapter.
(b) Cannabis business permit application fees and renewal fees shall be established
by resolution of the city council as may be amended from time to time.
9-489. Effect of state license suspension, revocation, or termination.
Suspension of a license issued by the State of California, or by any of its departments or
divisions, shall immediately suspend the ability of a cannabis business to operate within
the city, until the State of California, or its respective departments or divisions, reinstates
or reissues the State license within 90 days. Should the state license remain suspended
for 90 days or longer, any permit issued pursuant to this chapter shall expire and be of no
further force and effect. Should the State of California, or any of its departments or
divisions, revoke or terminate the license of a cannabis business, such revocation or
termination shall also revoke or terminate the ability of a business permitted pursuant to
this chapter including the persons and entities set forth in section 9-490(c) to operate any
cannabis business within the city for a period of five years from the date of such revocation
or termination.
9-490. Denial and revocation.
(a) Revocation. A cannabis business permit may be revoked or suspended pursuant
to the procedures of section 9-120 for failing to comply with the terms of the permit,
the applicable provisions of this chapter, this Code, city regulations, state law or
regulations and/or any conditions of any other permit issued pursuant to this Code.
(b) Denial. An application for a cannabis business permit may be denied where it fails
to provide all required information, documentation and/or fees and/or where it does
not or would not be able to comply with the applicable provisions of this chapter,
this Code, city regulations and/or state law or regulations and/or where the
applicant is otherwise ineligible for such permit.
(c) Effect of revocation and denial. Whenever an application for a permit is denied,
no other similar application by such applicant or permittee will be considered for
a period of one (1) year from the date of the denial of an application. Whenever
a permit has been revoked, no other similar application by such permittee shall be
considered for a period of five (5) years from either the date the notice of the permit
revocation was mailed or the date of the final decision of the city to revoke the
permit, whichever is later. The prohibitions of this subsection shall also apply to
the following:
1. Any individual whose permit was revoked or whose application was denied
who later becomes a director or officer of a corporation, profit or nonprofit,
or a member of a partnership or a person owning or possessing any portion
of the shares of a corporation seeking to obtain a new permit.
2. A corporation, profit or nonprofit, whose permit was revoked, or application
was denied, to any of its directors or officers or to any person who owned
any portion of its shares, who attempts by way of a new corporation or
using their individual names or becoming a member of a partnership or a
director or officer or a person owning or possessing any portion of the
shares in another corporation seeking to obtain a new permit.
(d) Ineligibility. In addition to any other law, no person or entity shall be eligible for
and/or receive a cannabis permit if that person or entity, or any director or officer
of that entity or a person who owned any portion of that entity’s shares, engaged
in unpermitted and/or illegal cannabis activity involving sales, delivery and/or
dispensing in the city, or had an ownership interest in any property set forth in
section 13-200.93(e)(5), in the five (5) years preceding an application under this
chapter. A determination of ineligibility under this sub-section (d) may be made by
the City Manager and shall be based on the preponderance of the evidence.
9-491. Appeals.
Notwithstanding any other provision of this code, only a decision by the city manager to
suspend, revoke or deny a cannabis business permit under this chapter shall be subject
to appeal, which shall be governed by the procedures set forth in Chapter IX of Title 2 of
this code.
9-492. Prohibition on transfer of cannabis business permits.
In the event a permit holding cannabis business sells or transfers the business to a new
owner and/or operates the business under a new entity and/or name not listed on the
permit, the new owner must obtain a new cannabis business permit and business license
prior to commencing or continuing operations. A cannabis business shall be deemed to
have transferred to a new owner within the meaning of this section if person(s) or entities
with controlling interest at the time the permit was first issued cease(s) at any time to
possess controlling ownership interest and/or an ownership interest of less than fifty-one
(51) percent.
9-493. City business license required.
Prior to commencing operations, a cannabis business shall obtain and thereafter maintain
a valid city business license pursuant to Chapter I of this title. Failure to do so will render
the cannabis permit invalid.
9-494. Conditional use permit required.
No cannabis business permit shall be issued, and no person shall conduct a cannabis
business unless a conditional use permit has been issued therefore pursuant to the
provisions of Title 13, Chapter IX, Article 21 of this Code.
9-495. Operating requirements for all cannabis businesses permitted under this
chapter.
(a) Records and recordkeeping.
1. Each owner and operator of a cannabis business shall maintain accurate
books and records, detailing all of the revenues and expenses of the
business, and all of its assets and liabilities. On no less than an annual basis
(at or before the time of the renewal of a cannabis business permit issued
pursuant to this title), or at any time upon reasonable request of the city,
each cannabis business shall file a sworn statement detailing the number
of sales by the cannabis business during the previous twelve (12) month
period (or shorter period based upon the timing of the request), provided on
a per-month basis. The statement shall also include gross sales for each
month, and all applicable taxes paid or due to be paid.
Each owner and operator shall keep and preserve for a period of no less
than seven (7) years, all records as may be necessary to determine the
amount of such tax the operator may have been liable to collect and remit
to the city.
2. Each owner and operator of a cannabis business shall maintain a current
register of the names and the contact information (including the name,
address, telephone number, a copy of that person’s government issued
identification, and email address) of anyone owning or holding an interest
in the cannabis business, and separately of all the officers, managers,
employees, agents and volunteers currently employed or otherwise
engaged by the cannabis business. The register required by this paragraph
shall be provided to the city manager upon a reasonable request.
3. All cannabis businesses shall maintain an inventory control and reporting
system that accurately documents the present location, amounts, and
descriptions of all cannabis and cannabis products for all stages of the
production or manufacturing, laboratory testing and distribution processes.
4. Subject to any restrictions under the Health Insurance Portability and
Accountability Act (HIPPA), each cannabis business shall allow city officials
to have access to the business’s books, records, accounts, together with
any other data or documents relevant to its permitted cannabis activities,
for the purpose of conducting an audit or examination. Books, records,
accounts, and any and all relevant data or documents will be produced no
later than twenty-four (24) hours after receipt of the city’s request, unless
otherwise stipulated by the city.
(b) Security measures.
1. A permitted cannabis business shall implement sufficient security measures
to deter and prevent the unauthorized entrance into areas containing
cannabis or cannabis products, and to deter and prevent the theft of cannabis
or cannabis products at the cannabis business. These security measures
shall include:
a. Establishing limited access areas accessible only to authorized
cannabis business personnel;
b. All cannabis and cannabis products shall be stored in a secured and
locked room, safe, or vault, and shall be kept in a manner as to prevent
diversion, theft, and loss;
c. Sensors shall be installed to detect entry and exit from all secure
areas;
d. Having a professionally installed, maintained, and monitored alarm
system;
e. Any bars to be installed on the windows or the doors of the cannabis
business for security purposes, if permitted by the city, shall be
installed only on the interior of the building;
f. Security personnel if utilized must be licensed by the State of California
Bureau of Security and Investigative Services Personnel, shall comply
with the requirements of California Business and Professions Code
Chapters 11.4 and 11.5 of Division 3, and have a valid business
license from the city; and
g. Each cannabis business shall have the capability to remain secure and
operational during a power outage and shall ensure that all access
doors are not solely controlled by an electronic access panel to ensure
that locks are not released during a power outage.
2. Each cannabis business shall identify a designated security
representative/liaison to the city, who shall be reasonably available to meet
with the city manager regarding any security related measures or and
operational issues.
3. A cannabis business shall notify the city manager within twenty-four (24)
hours after discovering any of the following:
a. Significant discrepancies identified during inventory, as set forth in the
city’s administrative regulations;
b. Diversion, theft, loss, or any criminal activity involving the cannabis
business or any agent or employee of the cannabis business; or
c. The loss or unauthorized alteration of records related to cannabis,
registering qualifying patients, primary caregivers, or employees or
agents of the cannabis business and/or cannabis sales.
(c) Restriction on alcohol sales. No person shall cause or permit the sale, dispensing,
or consumption of alcoholic beverages on or about the premises of the cannabis
business.
(d) Compliance with laws. It is the responsibility of the owners and operators of the
cannabis business to ensure that it is, at all times, operating in a manner compliant
with all applicable state and local laws, and any regulations promulgated
thereunder. Nothing in this chapter shall be construed as authorizing any actions
which violate state law or local law with respect to the operation of a cannabis
business or any site-specific, additional operating procedures or requirements
which may be imposed as conditions of approval of the location of the cannabis
business.
(e) Taxes. All cannabis businesses authorized to operate under this chapter shall pay
all sales, use, business and other applicable taxes, and all license, registration,
and other fees required under federal, state and local law. Each cannabis business
shall cooperate with the city with respect to any reasonable request to audit the
cannabis business’s books and records for the purpose of verifying compliance
with this section, including, but not limited to, a verification of the amount of taxes
required to be paid during any period.
(f) Insurance. Permittee shall obtain and maintain at all times during the term of the
permit comprehensive general liability insurance and comprehensive automotive
liability insurance protecting the permittee in an amount of not less than one million
dollars ($1,000,000.00) per occurrence, combined single limit, including bodily
injury and property damage and not less than one million dollars ($1,000,000.00)
aggregate for each personal injury liability, products-completed operations and
each accident, issued by an insurance provider rated at least A-:VIII in A.M. Best
and Company’s Insurance Guide and either admitted and authorized to do
business in California or is listed on the California Department of Insurance’s List
of Approved Surplus Line Insurers.
(g) Miscellaneous operating requirements.
1. Restriction on consumption. Cannabis shall not be consumed on the
premises of any cannabis businesses or elsewhere in the city other than
within private residences.
2. No cannabis or cannabis products or graphics depicting cannabis or
cannabis products shall be visible from the exterior of any property issued
a cannabis business permit, or on any of the vehicles owned or used as part
of the cannabis business. No outdoor storage of cannabis or cannabis
products is permitted at any time.
3. Reporting and tracking of product and of gross sales. Each cannabis
business shall have in place a point-of-sale tracking system to track and
report on all aspects of the cannabis business including, but not limited to,
such matters as cannabis tracking, inventory data, and gross sales (by
weight and by sale). The cannabis business shall ensure that such
information is compatible with the city’s record-keeping systems. The
system must have the capability to produce historical transactional data for
review by the city manager.
4. All cannabis and cannabis products sold, distributed or manufactured shall
be cultivated, manufactured, and transported by licensed facilities that
maintain operations in full conformance with all state and local regulations.
5. There shall not be a physician located in or around any cannabis business
at any time for the purpose of evaluating patients for the issuance of a
cannabis prescription or card.
6. Signage and notices.
a. In addition to the requirements otherwise set forth in this section,
business identification signage for a cannabis business shall conform
to the requirements of this Code, including, but not limited to, seeking
the issuance of a city sign permit.
b. Each entrance to a cannabis business shall be visibly posted with a
clear and legible notice indicating that smoking, ingesting, or otherwise
consuming cannabis on the premises or in the areas adjacent to the
cannabis business is prohibited.
c. Business identification signage shall be limited to that needed for
identification only.
d. The business shall at all times comply with the advertising and
marketing restrictions of Business and Professions Code sections
26150-26156, in addition to the requirements of this code.
7. Minors.
a. Persons under the age of twenty-one (21) years shall not be allowed on
the premises of a cannabis business, except as otherwise specifically
provided for by state law. It is unlawful and a violation of this chapter for
any person to employ any person at or for a cannabis business who is
not at least twenty-one (21) years of age.
b. The entrance to the cannabis business shall be clearly and legibly posted
with a notice that no person under the age of twenty-one (21) years of
age is permitted to enter upon the premises of the cannabis business
except as specifically provided for herein.
8. Odor control. Odor control devices and techniques shall be incorporated in
all cannabis businesses to ensure that odors from cannabis are not
detectable off-site.
9. Display of permit and city business license. The original copy of the
cannabis business permit issued by the city pursuant to this chapter and the
city-issued business license shall be posted inside the cannabis business
in a conspicuous location.
10. Background check. Every owner, manager, supervisor or employee of the
cannabis business must submit fingerprints and other information deemed
necessary by the city manager for a background check by the Costa Mesa
police department to verify that person’s criminal history. No person shall
be issued a permit to operate a cannabis business who has been convicted
of a felony within the past seven (7) years, unless that felony has been
dismissed, withdrawn, expunged or set aside pursuant to Penal
Code section 1203.4, 1000 or 1385, or who is currently on probation or
parole for the sale, distribution, possession or manufacture of a controlled
substance. Exempted from this prohibition is a conviction for a felony
involving cannabis and/or marijuana for which the underlying cannabis or
marijuana offense has subsequently been designated a misdemeanor or
infraction or decriminalized pursuant to the provisions of the Control,
Regulate and Tax Adult Use of Marijuana Act or federal law.
11. Loitering. The owner and/or operator of a cannabis business shall prohibit
loitering by persons outside the facility both on the premises and within fifty
(50) feet of the premises.
12. Permits and other approvals. Prior to the establishment of any cannabis
business or the operation of any such business, the person intending to
establish a cannabis business must first obtain all applicable planning,
zoning, building, and other applicable permits from the relevant
governmental agency which may be applicable to the zoning district in
which such cannabis business intends to operate.
13. Free samples. No cannabis business shall provide or cause to be provided
any free sample of cannabis goods to any person within the city.
14. A licensed retailer may only sell cannabis goods, cannabis accessories, and
licensees’ branded merchandise or promotional materials
(h) Additional operating requirements for retail sale (storefront) businesses. In
addition to every other requirement of this section, other than those set forth in
subsection (i) (retail sale, non-storefront) that are expressly inapplicable, every
business that sells cannabis as a storefront retailer shall comply with the following
requirements:
1. The security plan shall include at least one (1) licensed private security
guard or guards who shall be present at the premises twenty-four (24)
hours per day, exterior lighting, and continuous video monitoring and
recording of the interior and exterior of the premises. Video surveillance
recordings must also include video of all entryways and exits of the
premises. All video recordings shall be maintained for a minimum of
ninety (90) days.
2. Both the private security guard and the business personnel shall
monitor the premises and the immediate vicinity of the premises to
ensure that patrons immediately leave the premises and do not
consume cannabis in the vicinity of the retail business or on the property
or in the parking lot, and shall ensure that persons do not loiter, linger,
or otherwise congregate within fifty (50) feet of the entrance to the
premises.
3. There shall be no on-site sales of alcohol or tobacco products,
(excluding rolling papers and lighters) and no on-site consumption of
food, alcohol, cannabis or tobacco by patrons.
4. Hours of operation shall be limited to: 7:00 a.m. to 10:00 p.m. daily. No
licensed retail business shall be open to the public between the hours of
10:01 p.m. and 6:59 a.m. of any day.
5. The cannabis retail business shall notify patrons of the following both
verbally and through posting of a sign in a conspicuous location:
a. Unlawful sale, barter or distribution of cannabis is a crime and
subject to a fine or arrest.
b. Loitering on and around the retail premises is prohibited by
California Penal Code section 647 and that patrons must
immediately leave the premises and not consume cannabis in the
vicinity and/or on the property or in the parking lot.
c. A warning that patrons and/or employees may be subject to
prosecution under federal cannabis laws, if applicable.
d. That the use of cannabis may impair a person’s ability to drive a
motor vehicle or operate machinery and that doing so is illegal.
6. No one under the age of twenty-one (21) shall be allowed to enter the
premises of a cannabis business unless the business holds a retail
medical cannabis license (M-license) issued by the State.
7. No person shall be permitted to enter the premises without government-
issued identification, and cannabis goods may not be provided to any
person, whether by purchase, trade, gift, or otherwise, who does not
possess a valid government-issued identification and who does not meet
the age requirements of this Chapter.
8. Electronic age verification device required. Proof of age of every person
other than employees entering the business shall be verified with an
electronic age verification device, prior to entry of the retail area or delivery
to that person. The electronic age verification device may be mobile or
fixed, and shall be able to retain a log of all scans that includes the
following information: date, time, and age. Said log shall be kept for a
minimum of one hundred eighty (180) business days and all records shall
be made available to the City Manager upon request.
9. Point-of-sale tracking required. The business shall facilitate the sale,
making available, furnishing and/or delivery of cannabis goods with a
technology platform that uses point-of-sale technology to track, and
database technology to record and store, the following information for
each transaction involving the exchange of cannabis goods between the
business and consumer:
a. The date and time of transaction.
b. The first name and employee number of the employee who
processed the sale of cannabis goods on behalf of the business.
c. A list of all the cannabis goods purchased, including the quantity
purchased.
d. The total amount paid for the sale, including the individual prices paid
for cannabis or cannabis products purchased, and any amounts paid
for taxes.
10. Cannabis retail businesses shall also record on the video surveillance
system point-of-sale areas and areas where cannabis goods are displayed
for sale.
11. Adequate signage shall clearly state who has inspected any cannabis
product for pesticides, or other regulated contaminants, distributed at this
location.
12. Shipments of cannabis goods may only be accepted during regular
business hours.
13. Inventory shall be secured using a lockable storage system during non-
business hours.
14. No cannabis product shall be visible from the exterior of the business.
15. All required labelling shall be maintained on all product, as required by State
law, at all times.
16. A permitted commercial cannabis retail business shall have one hundred
eighty (180) days after permit issuance by the city to commence operations,
after which the permit shall be void and of no further force and effect. A
permitted commercial cannabis retail business that ceases to operate for
more than ninety (90) calendar days after commencing operations shall be
deemed “abandoned” and the permit shall be forfeited. A permitted
commercial cannabis business may temporarily suspend operations for a
period of time as may be reasonably required to affect upgrades,
modifications, repairs, or other property issue mitigations as approved by
the director or city manager. For the purposes of this subsection, “operate”
shall mean by the end of the one hundred eighty (180) day period.
17. Obtain and maintain at all times during the term of the permit the insurance
required pursuant to subsection (f) of this section in the minimum amounts
of two million dollars ($2,000,000.00), and enter into an agreement
approved by the city attorney to defend, with attorneys of city’s choosing,
indemnify, release and hold harmless the city, its city council, boards,
commissions, officers and employees from and against any and all claims,
demands, obligations, damages, actions, causes of action, suits, losses,
judgments, fines, penalties, liabilities, costs and expenses (including,
without limitation, attorneys’ fees, disbursements and court costs) of every
kind and nature whatsoever which may arise from or in any manner relate
(directly or indirectly) to the permittee or the permittee’s activities. This
indemnification shall include, but not be limited to, damages awarded
against the city, if any, costs of suit, attorneys’ fees, and other expenses
incurred in connection with such claim, action, or proceeding whether
incurred by the permittee, city, and/or the parties initiating or bringing such
proceeding, and shall not be limited by the types and/or amounts of
insurance required herein;
18. For an applicant with two or more employees, provide a notarized statement
that the applicant will enter into, or demonstrate that it has already entered
into, and abide by the terms of a labor peace agreement as otherwise
required by Business and Professions Code section 26105.5.
(i) Additional operating requirements for retail sale (non-storefront) delivery
businesses. In addition to every other requirement of this section, except only for
subsection (h)(1) through (5) and (10) (retail sale, store-front), every business that
sells and/or delivers cannabis as a non-store front retailer shall comply with the
following requirements:
1. Commercial cannabis retail deliveries may be made only from a commercial
cannabis retail business permitted by the City in compliance with this
chapter, and in compliance with all State regulations.
2. All employees who deliver cannabis shall have valid identification and a
copy of the retail business' cannabis business permit and State license at
all times while making deliveries.
3. All commercial cannabis retail businesses shall maintain proof of vehicle
insurance for any and all vehicles being used to transport cannabis goods
as required by State law.
4. Deliveries may only take place during normal business hours of the
commercial cannabis retail business.
5. During delivery, the delivery employee shall maintain a physical or
electronic copy of the delivery request and shall make it available upon
request by the licensing authority and law enforcement officers. The delivery
request documentation shall comply with State law.
6. A licensed delivery employee shall not leave the State of California while
possessing cannabis products while performing his or her duties for the
cannabis retailer.
7. A commercial cannabis retail business shall maintain a list of all deliveries,
including the address delivered to, the amount and type of product
delivered, and any other information required by the State.
8. A manifest with all information required in this section shall accompany any
delivery person at all times during the delivery process and delivery hours.
9. Any delivery method shall be made in compliance with State law, as
amended, including use of a vehicle that has a dedicated GPS device for
identifying the location of the vehicle (cell phones and tablets are not
sufficient).
10. Each delivery request shall have a receipt prepared by the commercial
cannabis retail business with the following information:
a. Name and address of the commercial cannabis retail business.
b. The name of the employee who delivered the order.
c. The date and time the delivery request was made.
d. The complete delivery addresses.
e. A detailed description of the cannabis goods requested for delivery
including the weight or volume, or any accurate measure of the
amount of cannabis goods requested.
f. The total amount paid for the delivery including any fees or taxes.
g. At the time of the delivery, the date and time delivery was made,
and the signature of the person who received the delivery.
h. No cannabis delivery vehicle shall display signs, decals or any
other form of advertisement.
i. Inspections by an authorized City representative may be conducted
anytime during regular business hours.
11. Delivery must be made to a physical address that is not on publicly owned
land, a school, a day care, or a youth center.
12. The delivery employee shall not carry cannabis goods valued in excess of
$5,000 at any time with no more than $3,000 of cannabis goods that are not
already part of a customer order that was processed prior to leaving the
premises.
13. Delivery must be made in person by a direct employee of the licensed
retailer. An independent contractor, third-party courier service, or an
individual employed through a staffing agency would not be considered
directly employed by the licensed retailer.
9-496. Cannabis employees.
(a) Any person who is an employee or who otherwise works within a cannabis
business must be legally authorized to do so under applicable state law.
(b) No cannabis business or owner thereof may employ any person who has
been convicted of a felony within the past seven (7) years, unless that felony
has been dismissed, withdrawn, expunged or set aside pursuant to Penal
Code section 1203.4, 1000 or 1385, or who is currently on probation or parole
for the sale, distribution, possession or manufacture of a controlled
substance. Exempted from this prohibition is a conviction for a felony
involving cannabis and/or marijuana for which the underlying cannabis or
marijuana offense has subsequently been designated a misdemeanor or
infraction or decriminalized pursuant to the provisions of the Control,
Regulate and Tax Adult Use of Marijuana Act or federal law.
(c) All employees must wear an identification badge while on the premises of the
business, in a format authorized by the city manager.
9-497. Promulgation of administrative regulations.
(a) The city manager is also authorized to establish any additional administrative
rules, regulations, policies, procedures and/or standards governing the
issuance, denial or renewal of cannabis business permits, or concerning any
other subject necessary to carry out the purposes of this chapter.
(b) Regulations promulgated by the city manager shall become effective upon
the date of publication. Cannabis businesses shall be required to comply with
all state and local laws and regulations, including, but not limited to, any rules,
regulations policies, procedures and/or standards adopted by the city
manager.
(c) Such administrative rules, regulations and/or standards may include
establishing standards and timing for application processing, including but not
limited to providing priority for existing licensees in good standing.
9-498. Inspection and enforcement.
(a) The city manager is charged with enforcing the provisions of the Costa Mesa
Municipal Code, or any provision thereof, and may enter the location of a
cannabis business at any time during the hours of operation without notice,
and inspect the location of any cannabis business as well as any recordings
and records required to be maintained pursuant to this title or under
applicable provisions of state law.
(b) It is unlawful for any person having responsibility for the operation of a
cannabis business, to impede, obstruct, interfere with, or otherwise not to
allow, the city to conduct an inspection, review or copy records, recordings or
other documents required to be maintained by a cannabis business under
this chapter or under state or local law. It is also unlawful for a person to
conceal, destroy, deface, damage, or falsify any records, recordings or other
documents required to be maintained by a cannabis business under this
chapter or under state or local law.
9-499. Violations.
(a) Violations declared a public nuisance. Each and every violation of the
provisions of this chapter is hereby deemed unlawful and a public nuisance.
(b) Each violation a separate offense. Each and every violation of this chapter
shall constitute a separate violation and shall be subject to all remedies and
enforcement measures authorized by the Costa Mesa Municipal Code.
Additionally, as a nuisance per se, any violation of this chapter shall be
subject to injunctive relief, any permit issued pursuant to this chapter being
deemed null and void, disgorgement and payment to the city of any monies
unlawfully obtained, costs of abatement, costs of investigation, attorney fees,
and any other relief or remedy available at law or in equity. The city may also
pursue any and all remedies and actions available and applicable under state
and local laws for any violations committed by the cannabis business or
persons related to, or associated with, the cannabis activity. Additionally,
when there is determined to be an imminent threat to public health, safety or
welfare, the city manager, or the chief of police, may take immediate action
to temporarily suspend a cannabis business permit issued by the city,
pending a hearing before the city council.
(c) Criminal penalties. Each and every violation of the provisions of this chapter
may be prosecuted as a misdemeanor and upon conviction be subject to a
fine not to exceed one thousand dollars ($1,000.00) or imprisonment in the
County Jail for a period of not more than twelve (12) months, or by both such
fine and imprisonment. Each day a violation is committed or permitted to
continue shall constitute a separate offense.
(d) Remedies cumulative and not exclusive. The remedies provided herein are
not to be construed as exclusive remedies. The city is authorized to pursue
any proceedings or remedies provided by law.