HomeMy WebLinkAbout65C - RPT - MMD ENFORCEMENT PLANREQUEST FOR
COUNCIL ACTION
CITY COUNCIL MEETING DATE:
NOVEMBER 18, 2014
TITLE:
CONSIDERATION OF MEDICAL
MARIJUANA DISPENSARIES
ENFORCEMENT PLAN (STRATEGIC
PLAN NOS,-1i- 1 F; 1,1 B; 4, 2A; 5, 4E)
RECOMMENDED ACTION
Adopt Medical Marijuana Enforcement Plan.
DISCUSSION
CLERK OF COUNCIL USE ONLY:
APPROVED
❑ As Recommended
❑ As Amended
❑ Ordinance on 1" Reading
❑ Ordinance on 2nd Reading
❑ Implementing Resolution
❑ Set Public Hearing For
CONTINUED TO
FILE NUMBER
On September 2, 2014 the City Council requested staff to create an enforcement plan that would
more effectively provide for the closure of illegal medical marijuana dispensaries, as well as allow
for the monitoring of any collectives that might be allowed to operate legally should either of the
two ballot initiatives (Measure BB and Measure CC) scheduled to come before the voters on
November 4, 2014 should pass. Since that time Measure BB was adopted by the voters. This
staff report details the proposed enforcement plan, staffing requirements and revenue
projections.
RECOMMENDED ENFORCEMENT PLAN
The recommended Enforcement Plan will focus on gaining rapid closure of any
collectives /dispensaries operating illegally in the City of Santa Ana and will also provide for the
ongoing compliance with the operating standards established in Measure BB, adopted by the
voters on November 4, 2014. This enforcement plan will require additional staffing, which will be
offset by revenues estimated to be collected through the gross receipts tax on legal collectives.
Staff recommends that the process to begin rapid closure of any illegal dispensaries begin no
sooner than February 5, 2015. This is the date on which the locations of any legal collectives will
be known via the selection process mandated in Measure BB, at which point any dispensaries
still remaining in operation will clearly be operating in opposition to the law. All known illegal
dispensaries will be sent a letter prior to February 5, 2015 detailing the enforcement process to
provide advance notice of the City's intent to ensure that all illegally operating dispensaries are
closed.
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Medical Marijuana Dispensaries Enforcement Plan
November 18, 2014
Page 2
Illegal Dispensaries Rapid Closure Process
1. Issuance of administrative citation and fine to property owner and business operator.
Location must cease operations within 48 hours.
2. Disconnection of utilities. Upon return for inspection 48 hours after initial issuance of
administrative citation the location's utilities will be disconnected by the City. If they have
not already vacated the premises, any occupants must do so.
3. Posting of property. Following disconnection of the utilities the location will no longer be in
compliance with the requirements of the SAMC for buildings that are safe to occupy. The
property will be posted to notify the public that an illegal medical marijuana dispensary has
been closed at that location and will also contain contact information should the public
wish to contact the City to report any further illegal activity.
4. Arrest for trespassing. As a last resort, and should any individuals still remain in the
location, the Police Department may arrest them for trespassing.
Enforcement of Reaulatory Safety Permit for Approved Collectives
The Chief of Police, Carlos Rojas, has prepared a detailed memo regarding the process by which
the Police Department will ensure compliance with the standards contained within the regulatory
safety permit approved by the voters under Measure BB. This memo is attached.
Staffing Requirements and Revenues
Implementation of the rapid closure process and the ongoing enforcement of the requirements of
the regulatory safety permit will require the addition of the following staff positions:
Medical Mariivana Staffing Costs
Police Officer
Community Preservation Inspectors
i Forensic Auditor
6
Annual Cost Per
Projected Total
Tide Number
Position
Annual Cost
Police Officer
Community Preservation Inspectors
i Forensic Auditor
6
$
150,000
$
900,000
2
$
120,000
$
240,000
1
$
175,000
$
175,000
Assistant City Attorney
1
$
185,000
$
185,000
TOTAL
10
$
630,000
$
1,500,000
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Medical Marijuana Dispensaries Enforcement Plan
November 18, 2014
Page 3
The cost to offset these staff positions will be
received from the gross receipts tax charged
detailing this revenue estimate is attached.
funded by the revenue that is estimated to be
to each permitted dispensary. A spreadsheet
STRATEGIC PLAN ALIGNMENT
The Strategic Plan contains several strategies relating to the enforcement of medical marijuana
collectives /dispensaries:
Goal 1 - (Community Safety), Objective 1 (Modernize the Community Policing philosophy to
improve customer service, crime prevention and traffic / pedestrian / bicycle safety) Strategy f
(Enhance the Police Department's community policing philosophy to balance both traditional
policing and problem solving strategies to address and reduce violent, property and gang related
crimes), Strategy b (Develop a community policing plan based on community input to deliver
crime prevention/ community policing/ traffic - pedestrian safety programs in a consistent and
uniformed manner.)
Goal 4 - City Financial Stability Objective 2 Provide a reliable five -year financial forecast that
ensures financial stability in accordance with the strategic plan. Strategy A (Adopt a budget that
is in alignment with the financial forecast and strategic plan.)
Goal 5 - Community Health, Livability, Engagement & Sustainability, Objective 4 (Support
neighborhood vitality and livability.) Strategy E (Implement innovative code enforcement
practices and strategies including the use of volunteers, enhanced technologies and increased
collaboration with other City departments and outside agencies to address critical livability issues
citywide (e.g. overcrowding, absentee landlords, landlord /tenant rights and responsibilities, etc.).
FISCAL IMPACT
Revenue to fund any increased staffing costs will be provided through a gross receipts tax.
0
Karen A. Haluza
Interim Executive Director
Planning and Building Agency
KH:rb
WreportsWedleal Maoivana Enfonbment Plan RFCA 11 -18 -14
Exhibits: 1. Memo from Chief Carlos Rojas Re: Medical Marijuana Dispensary & Narcotics
Task Force
2. Revenue Projections
65C -3
65C -4
Memo
Santa Ana Police Department
Office of the Chief of Police
To: David Cavazos, City Manager
From: Carlos Rojas, Chief of Police
Date: November 12, 2014
Subject: Medical Marijuana Dispensary & Narcotics Task Force
BACKGROUND
On November 4, 2014, voters of Santa Ana passed a proposition regulating the operations of
sanctioned medical marijuana dispensary businesses in the city. On December 16, 2014, a
resolution adopting the Medical Marijuana Registration Processing Fee and Regulatory
Safety Permit Fee will be presented to the City Council for formal action. This new regulation
will require City staff to inspect sanctioned businesses for ordinance compliance and
aggressively address complaints of illegal business, in compliance with the law and best
investigative practices for appropriate legal disposition.
RECOMMENDATION / MISSION
I recommend a Team of five (5) experienced police officers, led by a Police Sergeant, be
established to serve as the primary enforcement arm to address this new public safety
business necessity. The Team would work as part of a larger Task Force with other City
partners from Code Enforcement, Building Inspection, City Attorney's Office and the Orange
County Fire Authority. The Detective Team members would operate out of the Investigations
Bureau of the Police Department. As the scope of some legal MMD's and certainly within the
illegal narcotics trade, there is a need to access the appropriate level of expertise in
conducting high level investigations related to money laundering and drug trafficking
organizations. This strategy may also involve partnerships with state and federal agencies.
The Detectives would have the ability and skill set to effectively operate in an undercover
capacity in support of all members of the Task Force and the City's overall mission in
addressing this public safety concern. As with other traditional investigative units, the Team
would work closely in direct support of case preparation for criminal prosecution and/or
administrative civil action.
FISCAL IMPACT
Personnel costs for (1) Detective Sergeant, (5) Detectives; undercover vehicles and smart
phones budgeted as ongoing costs. Work space for the Team has been designated within
Investigations Bureau, including meeting rooms for the broader Task Force members as
needed.
EXHIBIT 1
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MEMORANDUM (9
To: Mayor and City Council Date: November 13, 2014
From: David Cavazos, City Manager
Subject:
IMPLEMENTATION OF MEASURE BB — MEDICAL MARIJUANA DISPENSARY PERMITS
This memo has been developed in coordination with the City Attorney's Office and provides an update
on the implementation of Measure BB. Since the adoption of Measure BB on November 4, 2014 a
number of questions have arisen about the ordinance, whether near -term changes can be made to it,
how the new ordinance will be implemented, and whether the applicant qualifications and operational
standards will address public safety concerns. This memo will address each of these questions.
The ordinance; including the qualification, registration and selection process, were developed after
extensive research and City Council input including:
1. Consulting with experts involved in developing medical marijuana legislation here in California
and other states;
2. Researching processes used in other cities that regulate medical marijuana, including the cities
of Berkeley, Long Beach, Los Angeles, Palm Springs, Phoenix, AZ, Oakland, San Diego, and
others and;
3. Numerous meetings among staff to ensure a rigorous application process.
Voter Approved Ballot Measure
The City has a legal duty to enforce a voter - approved ballot measure. Cases have suggested that a City
Attorney has a duty to enforce a voter - approved measure even while seeking a judicial determination
in a post - election challenge. As members of the City Council have noted, the adopted measure includes
language reserving the right of the City Council to make future amendments without voter approval
(Measure BB — Section 6). However, the primary intent of this section is to allow for updates to the
ordinance to ensure that the City remains in compliance with state and federal laws, as well as to allow
for the ability to make adjustments to the ordinance should experience gained during its
implementation indicate the need to do so. At this time, we have no recommended changes to the
ordinance.
Mandated Processing Timeline
Measure BB mandates a strict processing timeline. Regardless of any challenges to the Measure, the
City must proceed with implementation. Staff will bring an enforcement plan before the City Council
on November 18, 2014 and there will be several follow -up items, such as the establishment of
application fees, which will be brought before the Council on December 16, 2014. Certification of the
election results, including Measure BB, will be considered by the City Council on December 9, 2014,
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65C -7
which begins the mandated implementation timeline. Key dates to which the City must adhere are as
follows:
December 17, 2014 Applications to register are released to the public.
January, 15, 2015 Application period closes. The Planning and Building Agency Executive Director
will review the applications to determine if the proposed location is within one
of the eligible zones. If the address is not within one of the eligible zones, the
application will be rejected. Staff will also map each of the proposed locations
to determine which, if any, are within 500 feet of another collective. This
information will be used during the lottery.
January 26, 2015 Applicants will be notified if the address they propose has qualified.
February 5, 2015 A public selection meeting (lottery) will be held to choose specific locations
from the qualified registration list. This process will be used to ensure that no
two dispensaries are located within less than 500 feet of each other. All of
those on the qualified registration list will be assigned a number during the
selection meeting (lottery). Locations will be selected until either, all of the
allowable areas are covered, or there are no more applications. This does not
allow a seller to begin operating. It only qualifies them for the next step in the
process — application for the regulatory safety permit. The entire lottery
process will be overseen by an outside, independent accounting firm.
Extensive Pre - Qualification Process, Thorough Background Check, Operating Standards
Upon receipt of the application for the regulatory safety permit, the Police Department will begin
background checks and review each component of the extensive and detailed security plan that each
prospective operator must submit. Each collective operator(s) and employees shall complete a criminal
background check. Employees, managers or volunteers may not have been convicted of, or plead
guilty /no- contest to a felony or misdemeanor drug charge within the past four years. The following is a
detailed list of the regulatory safety permit application requirements, requirements for approval by the
Police Chief and operating standards.
Regulatory Safety Permit Application Requirements
• The address of the property where the proposed Medical Marijuana Collective(s) will operate;
• A site plan describing the property with fully dimensioned interior and exterior floor plans
including electrical, mechanical, plumbing, and disabled access compliance pursuant to Title 24
of the State of California Code of Regulations and the federally mandated Americans with
Disabilities Act;
• Exterior photographs of the entrance(s), exits(s), street frontage(s), parking, front, rear and
side(s) of the proposed property;
• Photographs depicting the entire interior of the proposed property;
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65C -8
• If the property is being rented or leased or is being purchased under contract, a copy of such
lease or contract;
• If the property is being rented or leased, written proof that the property owner, and landlord if
applicable, were given notice that the property will be used as a Medical Marijuana Collective,
and that the property owner, and landlord if applicable, agree(s) to said operations;
• The name, address, telephone number, title and function(s) of each manager, employee,
volunteer, etc.;
• For each manager, employee, volunteer, a fully legible copy of one valid government issued
form of photo identification, such as State Driver's License or Identification Card;
• If the Medical Marijuana Collective is a corporation, a certified copy of the Collective's
Secretary of State Articles of Incorporation, Certificate(s) of Amendment, Statement(s) of
Information and a copy of the Collective's Bylaws;
• If the Medical Marijuana Collective is an unincorporated association, a copy of the Articles of
Association;
• The name and address of the applicant's current agent for Service of Process;
• A copy of the applicant's Board of Equalization Seller's Permit;
• A copy of the Medical Marijuana Collective Operating Standards, listed in Section 18 -613,
containing a statement dated and signed by the responsible party on -site stating under penalty
of perjury, that they read, understand and shall ensure compliance with the aforementioned
operating standards.
Regulatory Safety Permit Requirements for Aporoval by the Chief of Police
• The required fee has been paid.
• The application conforms in all respects to the provisions of this article.
• The applicant has not knowingly made a material misrepresentation in the application.
• The applicant has fully cooperated in the investigation of his application.
• The applicant has not had a regulatory safety permit or other similar license or permit denied or
revoked for cause by this City or any other city located in or out of this state within the five (5)
years prior to the date of application.
• The collective as proposed by the applicant would comply with all applicable laws including, but
not limited to, health, zoning, fire and safety requirements.
• The applicant has demonstrated compliance with the California Department of Justice, Office of
the Attorney General, "Guidelines for the Security and Non - Diversion of Marijuana Grown for
Medical Use' standards.
Operating Standards
• At all times the collective is open, a collective shall provide at least one security guard who is
licensed, possesses a valid Department of Consumer Affairs "security guard card ", and has a
valid Santa Ana Business License. Security guards shall not possess firearms.
• The security guard and collective personnel shall monitor the site and the immediate vicinity of
the site to assure that patrons immediately leave the site and not consume medical marijuana
in the vicinity of the collective or on the property or in the parking lot.
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65C -9
• Exterior signage shall be limited to one wall sign not to exceed ten square feet in area and may
not be externally or internally illuminated. Interior signage or advertising may not be visible
from the exterior.
• No recommendations from a doctor for medical marijuana shall be issued on -site.
• There shall be no on -sale sales of alcohol or tobacco products, and no on -site consumption of
food, alcohol, tobacco or marijuana by patrons.
• Hours of operation shall be limited to: Monday— Saturday 10 a.m. to 8 p.m. and Sunday 11 a.m.
to 7 p.m.
• The property provides a sufficient odor absorbing ventilation and exhaust system so that odor
generated inside the property is not detected outside the property, anywhere on adjacent
property or public rights -of -way, or within any other unit located within the same building as
the collective.
• A collective shall only dispense medical marijuana to qualified patients and their caregivers as
defined by California Health and Safety Code section. 11362.5 (Proposition 215). This shall
include possession of an original valid doctor's recommendation, not more than one year old,
for medical marijuana use by the patient.
• A collective shall notify patrons of the following both verbally and through posting of a sign in a
conspicuous location:
• Use of medical marijuana shall be limited to the patient identified on the doctor's
recommendation. Secondary sale, barter or distribution of medical marijuana is a crime
and can lead to arrest.
• That loitering on and around the collective site is prohibited by California Penal Code
section 647(e) and that patrons must immediately leave the site and not consume
medical marijuana in the vicinity of the collective or on the property or in the parking
lot.
• Forgery of medical documents is a felony crime.
• A warning that patrons may be subject to prosecution under federal marijuana laws.
• That the use of medical marijuana may impair a person's ability to drive a motor vehicle
or operate machinery.
• A collective shall not provide marijuana to any individual in an amount not consistent with
personal medical use.
• A collective shall not store more than $200.00 in cash reserves overnight on the premises and
shall make at least one daily bank drop that includes all cash collected on that business day.
• No one under 21 years of age shall be permitted to enter establishment, unless such person is a
qualified patient and is accompanied by his or her Primary Caregiver, licensed Attending
Physician, parent(s) or documented legal guardian.
• A collective shall provide the name and phone number of an on -site staff person to the Police
Department and Community Preservation Division for notification if there are operational
problems with the establishment.
• Each collective operator(s) and employees shall complete a criminal background check.
Employees, managers or volunteers may not have been convicted of, or please guilty /no-
contest to a felony or misdemeanor drug charge within the past four years.
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• Marijuana shall not be grown or cultivated at collective sites, except that cuttings of the
marijuana plant may be kept or maintained on -site for distribution to qualified patients and
primary caregivers as follows:
• The cuttings shall not be utilized by a collective as a source for the provision of
marijuana for consumption on -site, however, upon provision to a qualified patient or
primary caregiver, that person may use the cuttings to cultivate marijuana plants off -site
for their own use and they may also return marijuana from the resulting mature plant
for distribution by the collective.
• For the purposes of this paragraph, the term "cutting" shall mean a rootless piece cut
from a marijuana plant, which is no more than six inches in length, and which can be
used to grow another plant in a different location.
• A collective shall comply with the applicable provisions of the California Health and Safety Code
sections 11362.5 through 11362.83, inclusive.
• If food is distributed, the collective shall comply with all relevant state laws and City ordinances
pertaining to the preparation, distribution and sale of food.
• The location, interior and exterior, shall be monitored at all times by web -based closed- circuit
television for security purposes. The camera and recording system must be of adequate
quality, color rendition and resolution to allow the ready identification of any individual
committing a crime anywhere on or adjacent to the location. The recordings shall be
maintained for a period of not less than ninety days. The Police Department may request the
recordings in connection with an investigation. If the recordings are not voluntarily provided,
the Police Department may seek a warrant or court order for the recordings.
• The location shall have a centrally- monitored fire and burglar alarm system and the building or
the portion of the building where the collective is located shall contain a fire -proof safe.
• No manufacture of concentrated cannabis in violation of California Health and Safety Code
section 11379.6 is allowed.
• No collective shall operate for profit. Cash and in -kind contribution, reimbursements, and
reasonable compensation provided by members towards the collective's actual expenses of the
growth, cultivation, and provision of medical marijuana shall be allowed provided that they are
in strict compliance with State Law. All such cash and in -kind amounts and items shall be fully
documented.
• If the collective operator is not the owner of the property where the collective is to operate,
the operator shall provide evidence that the property owner(s) consent to the operation of a
collective on the property.
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65C -11
Requirements for Certificate of Occupancy and Business License
After the regulatory safety permit has been approved by the Police Chief, the prospective operator
must also apply for a Certificate of Occupancy and obtain a business license. After the operator has
successfully completed all of these steps, they may begin operating. Operators must remain in
compliance with all ordinance requirements. Permits may be revoked in the event that operators
cease to comply and they may be charged with a misdemeanor. In addition, each operator must apply
to renew their regulatory safety permit on an annual basis.
This memo and all of the information pertaining to Measure BB can be found on the City's website at
the following address: www.santa- ana.org /cannabiscollectives.
r
Karen Haluza
Interim Executive Director — Planning and Building Agency
cc: Sonia Carvalho, City Attorney
Carlos Rojas, Police Chief
Attachments: Measure BB Ordinance Language
Eligibility Map
Processing Timeline
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65C -12
PROPOSED ORDINANCE NO. NS -2864
AN ORDINANCE OF THE PEOPLE OF THE CITY OF
SANTA ANA AMENDING CHAPTER 18 OF THE
MUNICIPAL CODE TO DELETE AND REPLACE ARTICLE
XIII, TO DELETE SECTION 41 -121, DELETE
SUBSECTION (B) OF SECTION 41 -144, AND AMEND
ARTICLE XII OF CHAPTER 21 BY ADDING SECTIONS
21 -126, 21 -127, 21 -128, 21 -129 AND 21 -130 TO
REGULATE THE ESTABLISHMENT, OPERATION AND
TAXATION OF MEDICAL MARIJUANA COLLECTIVES
AND COOPERATIVES
WHEREAS, in 1996, the California electorate approved Proposition 215, the
Compassionate Use Act of 1996, which allows a patient, with a doctor's
recommendation, to use marijuana for medical purposes without the fear of prosecution
or arrest; and
WHEREAS, in 2003, the California legislature passed Senate Bill 420 (Medical
Marijuana Program Act) which amended the Health and Safety Code to permit the
establishment of medical marijuana dispensaries for the distribution of marijuana for
medical purposes; and
WHEREAS, cities where medical marijuana dispensaries have been permitted to
operate have experienced significant problems, including burglaries and takeover
robberies of dispensaries, robberies of customers leaving dispensaries, an increase in
crime (especially thefts and robberies) in the vicinity of dispensaries, illegal re- selling of
marijuana obtained from dispensaries, physicians issuing apparently fraudulent
recommendations for the use of marijuana, collective staff selling marijuana to
customers with obviously counterfeit patient identification cards, street dealers
attempting to sell marijuana to collective customers, collective customers using
marijuana and then driving under the influence of marijuana, the sale of illegal drugs
other than marijuana in the dispensaries, sales of marijuana to minors; and
WHEREAS, after studying various alternatives for the regulation of medical
marijuana dispensaries, considering testimony from members of the public, and
reviewing the legal status of medical marijuana dispensaries under applicable law, the
City Council finds that the regulation and operation of medical marijuana dispensaries is
necessary to protect the public health, safety, and welfare by mitigating the adverse
secondary effects from the operations of medical marijuana dispensaries; and
WHEREAS, the City of Santa Ana has a compelling interest in ensuring that
marijuana is not distributed in an illicit manner, in protecting the public health, safety
and welfare of its residents and businesses, in preserving the peace and quiet of the
neighborhoods in which medical marijuana collectives operate, and in providing
compassionate access to medical marijuana to its seriously ill residents.
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NOW, THEREFORE, THE PEOPLE OF THE CITY OF SANTA ANA DO
ORDAIN AS FOLLOWS:
SECTION 1. The People hereby adopt the recitals and findings set forth above and in
the request for Council action -staff report prepared in connection with this ordinance.
SECTION 2. Article XIII of Chapter 18 of the Santa Ana Municipal Code is hereby
deleted in its entirety and replaced with the following:
Chapter 18
ARTICLE XIII. MEDICAL MARIJUANA COLLECTIVES /COOPERATIVES
18 -610. Purposes and intent.
It is the purpose and intent of this article to regulate the collective distribution of
medical marijuana in order to ensure the health, safety and welfare of the residents of
the City of Santa Ana. The regulations in this article, in compliance with the
Compassionate Use Act, the Medical Marijuana Program Act, and the California Health
and Safety Code (collectively referred to as "State Law ") do not interfere with a patient's
right to use medical marijuana as authorized under State Law, nor do they criminalize
the possession or cultivation of medical marijuana by specifically defined classifications
of persons, as authorized under State Law. Under State Law, only qualified patients,
persons with identification cards, and primary caregivers may cultivate medical
marijuana collectively. Medical marijuana collectives shall comply with all provisions of
the Santa Ana Municipal Code ( "Code "), State Law, the 2008 California Attorney
General Guidelines for the Security and Non - Diversion of Marijuana Grown for Medical
Use, and all other applicable local and state laws. Nothing in this article purports to
permit activities that are otherwise illegal under state or local law.
18 -611. Definitions.
(a) "Cultivation" and /or "Cultivate' shall mean the planting, growing, harvesting,
drying, processing, or storage of one or more marijuana plants or any part thereof.
(b) "Medical Marijuana Collective" or "Cooperative" or "Collective" means any
facility or location where medical marijuana is made available and /or distributed by or to
one or more of the following: a primary caregiver, a qualified patient or a person with an
identification card in strict accordance with California Health and Safety Code Section
11362.5 et seq., as sometimes amended. A "medical marijuana collective" shall not
include the following uses, as long as the location of such uses are otherwise regulated
by this Code or applicable law: a clinic licensed pursuant to Chapter 1 of Division 2 of
the Health and Safety Code, a health care facility licensed pursuant to Chapter 2 of
Division 2 of the Health and Safety Code, a residential care facility for persons with
chronic life- threatening illness licensed pursuant to Chapter 3.01 of Division 2 of the
Health and Safety Code, a residential care facility for the elderly licensed pursuant to
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65C -14
Chapter 3.2 of Division 2 of the Health and Safety C
home health agency licensed pursuant to Chapter 8
Safety Code, as long as such use complies strictly with
limited to, Health and Safety Code Section 11362.5
Municipal Code, "Dispensary" and "Dispensaries" have
Collective or Cooperative.
ode, a residential hospice or a
)f Division 2 of the Health and
applicable law including, but not
et seq. For purposes of this
the same the same meaning as
(c) "Identification Card" shall have the same definition as that contained in
Health and Safety Code § 11362.7 et seq., as sometimes amended.
(d) "Manager" means any person responsible for the establishment,
organization, supervision, or oversight of the operation of a Collective, including but not
limited to members who perform the functions of president, vice - president, director,
operating officer, financial officer, secretary, or treasurer. Ability to control one or more
of the following functions shall be prima facie evidence that such person is a manager:
(1) to hire, select, or separate employees or staff, including volunteers; (2) to acquire
facilities, furniture, equipment or supplies other than occasional replenishment of stock;
(3) to disburse funds of the business other than occasional expenditures for
replenishment of stock; or (4) to make, or participate in making, policy decisions relative
to the operations of the business.
(e) "Marijuana" shall have the same definition as that contained in Health and
Safety Code § 11018 as sometimes amended.
(f) "Medical Marijuana" shall have the same definition as that contained in
Health and Safety Code § 11362.5 et seq., as sometimes amended.
(g) "Primary Caregiver" shall have the same definition as that contained in
Health and Safety Code § 11362.5 and 11362.7, as sometimes amended.
(h) "Qualified Patient" shall have the same definition as that contained in
Health and Safety Code § 11362.5 as sometimes amended.
18 -612. Scope of article.
The operating standards established in this article apply to any site, facility,
location, use, cooperative or business currently operating in the City of Santa Ana, or
which commences operations after the effective date of this Article, that distributes,
dispenses, stores, sells, exchanges, processes, delivers, or gives away, medical
marijuana to qualified patients, health care providers, patients' primary caregivers, or
physicians, pursuant to Health & Safety Code § 11362.5 (adopted as Proposition 215,
the "Compassionate Use Act of 1996 ") or any state regulations adopted in furtherance
thereof. Any collective in the City of Santa Ana shall operate in conformance with the
operating standards set forth in section 18 -613 of this Code to assure that the
operations of the collective are in compliance with California law and to mitigate the
adverse secondary effects from operations of dispensaries.
18 -613. Operating standards.
65C -15
(a) At all times the collective is open, a collective shall provide at least one
security guard who is licensed, possesses a valid Department of Consumer Affairs
"security guard card ", and has a valid Santa Ana Business License. Security guards
shall not possess firearms.
(b) The security guard and collective personnel shall monitor the site and the
immediate vicinity of the site to assure that patrons immediately leave the site and not
consume medical marijuana in the vicinity of the collective or on the property or in the
parking lot.
(c) Exterior signage shall be limited to one wall sign not to exceed ten square
feet in area and may not be externally or internally illuminated. Interior signage or
advertising may not be visible from the exterior.
(d) No recommendations from a doctor for medical marijuana shall be issued
on -site.
(e) There shall be no on -site sales of alcohol or tobacco products, and no on-
site consumption of food, alcohol, tobacco or marijuana by patrons.
(f) Hours of operation shall be limited to: Monday -- Saturday 10 a.m. - -8 p.m.
and Sunday 11 a.m.--7 p.m.
(g) The property provides a sufficient odor absorbing ventilation and exhaust
system so that odor generated inside the property is not detected outside the property,
anywhere on adjacent property or public rights -of -way, or within any other unit located
within the same building as the collective.
(h) A collective shall only dispense medical marijuana to qualified patients
and their caregivers as defined by California Health and Safety Code § 11362.5
(Proposition 215). This shall include possession of an original valid doctor's
recommendation, not more than one year old, for medical marijuana use by the patient.
(1) A collective shall notify patrons of the following both verbally and through
posting of a sign in a conspicuous location:
(1) Use of medical marijuana shall be limited to the patient identified on
the doctor's recommendation. Secondary sale, barter or distribution of medical
marijuana is a crime and can lead to arrest.
(2) That loitering on and around the collective site is prohibited by
California Penal Code § 647(e) and that patrons must immediately leave the site
and not consume medical marijuana in the vicinity of the collective or on the
property or in the parking lot.
(3) Forgery of medical documents is a felony crime.
(4) A warning that patrons may be subject to prosecution under federal
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65C -16
marijuana laws.
(5) That the use of medical marijuana may impair a person's ability to
drive a motor vehicle or operate machinery.
(j) A collective shall not provide marijuana to any individual in an amount not
consistent with personal medical use.
(k) A collective shall not store more than $200.00 in cash reserves overnight
on the premises and shall make at least one daily bank drop that includes all cash
collected on that business day.
(1) No one under 21 years of age shall be permitted to enter establishment,
unless such person is a qualified patient and is accompanied by his or her Primary
Caregiver, licensed Attending Physician, parent(s) or documented legal guardian.
(m) A collective shall provide the name and phone number of an on -site staff
person to the Police Department and Community Preservation Division for notification if
there are operational problems with the establishment.
(n) Each collective operator(s) and employees shall complete a criminal
background check. Employees, managers or volunteers may not have been convicted
of, or plead guilty /no- contest to a felony or misdemeanor drug charge within the past
four years.
(o) Marijuana shall not be grown or cultivated at collective sites, except that
cuttings of the marijuana plant may be kept or maintained on -site for
distribution to qualified patients and primary caregivers as follows:
(1) The cuttings shall not be utilized by a collective as a source for the
provision of marijuana for consumption on -site, however, upon
provision to a qualified patient or primary caregiver, that person
may use the cuttings to cultivate marijuana plants off -site for their
own use and they may also return marijuana from the resulting
mature plant for distribution by the collective.
(2) For the purposes of this paragraph, the term "cutting" shall mean a
rootless piece cut from a marijuana plant, which is no more than six
inches in length, and which can be used to grow another plant in a
different location.
(p) A collective shall comply with applicable provisions of the California Health
and Safety Code §§ 11362.5 through 11362.83, inclusive.
(q) If food is distributed, the collective shall comply which all relevant state
laws and City ordinances pertaining to the preparation, distribution and
sale of food.
65C -17
(r) The location, interior and exterior, shall be monitored at all times by web -
based closed- circuit television for security purposes. The camera and
recording system must be of adequate quality, color rendition and
resolution to allow the ready identification of any individual committing a
crime anywhere on or adjacent to the location. The recordings shall be
maintained for a period of not less than ninety days. The Police
Department may request the recordings in connection with an
investigation. If the recordings are not voluntarily provided, the Police
Department may seek a warrant or court order for the recordings.
(s) The location shall have a centrally - monitored fire and burglar alarm
system and the building or the portion of the building where the collective
is located shall contain a fire -proof safe;
(t) No manufacture of concentrated cannabis in violation of California Health
and Safety Code section 11379.6 is allowed;
(u) No collective shall operate for profit. Cash and in -kind contributions,
reimbursements, and reasonable compensation provided by members
towards the collective's actual expenses of the growth, cultivation, and
provision of medical marijuana shall be allowed provided that they are in
strict compliance with State Law. All such cash and in -kind amounts and
items shall be fully documented.
(v) If the collective operator is not the owner of the property where the
collective is to operate, the operator shall provide evidence that the
property owner(s) consent to the operation of a collective on the property.
18 -614. Reserved.
18 -615. Zones permitted.
No collective shall operate within a residential (R -1, R -2, R -3, R -4, RE, CR) zone,
Professional (P) zone, Arterial Commercial (C -5) zone, Planned Shopping Center (C -4)
zone, Specific Development (SD), Specific Plan (SP) or Agricultural (A -1) zone. A
Collective may only operate in an Industrial zone (M -1, M -2) in accordance with this
Article.
18 -616. Separation requirements.
(a) No collective shall be located within 500 feet of another Medical Marijuana
Collective or Cooperative or within 1,000 feet of any:
(1)
School;
(2)
Park;
(3)
Residential zone.
65C -18
18- 617.01 Cooperative /Collective registration required.
Within 30 days after the adoption of this Chapter, the Director of Planning and
Building shall prepare Cooperative /Collective registration application forms and a
related administrative policy. Each collective interested in operating pursuant to this
article may submit an application together with a non - refundable processing fee in an
amount established by the City Council within 60 days after the adoption of this article,
the Director shall stop accepting applications and process all applications received.
The Director or his or her designee shall determine whether each application
demonstrates compliance with this article. Each application that is in compliance with
this article shall be placed on a qualified registration list and the Director shall notify the
applicant in writing of its qualified registration status. Once all applications are
processed, the Director shall hold a 'lottery" process in an open and public location and
select 20 applications. Each applicant may then choose to file an application for a
Regulatory Safety Permit pursuant to Section 18- 617.2.
The Director shall maintain the qualified registration list and update it on an
annual basis. Any applicant on the list must submit a written request each year to
maintain its status on the list and the Director may place new applicants on the list in
order in which the applications are received.
18- 617.01 Cooperative /Collective regulatory safety permit.
(a) Every Medical Marijuana Collective shall obtain a Regulatory Safety Permit
from the Police Department. The applicant shall pay a non - refundable fee in an amount
established by the City Council. It shall be unlawful for any person, association,
partnership or corporation to engage in, conduct or carry on, in or upon any premises
within the City a Medical Marijuana Collective without the required permit.
(b) A copy of the Regulatory Safety Permit shall be displayed at all times in a
place visible to the public.
(c) A Regulatory Safety Permit shall be valid for a period of one (1) year, unless
sooner revoked. No permit granted herein shall confer any vested right to any person
or business for more than the above - referenced period.
18- 617.2. Medical marijuana collective — regulatory permit application
process.
(a) Any Medical Marijuana Collective desiring a regulatory safety permit required
by this article shall, prior to initiating operations and after receiving notice of its
successful registration under section 18- 617.01, complete and file an application to the
Chief of Police on a form supplied by the Police Department. The application shall be
filed together with a nonrefundable fee as establish by resolution of the City Council, to
defray, the cost of investigation required by this article. The application shall contain all
of the following:
65C -19
(1) The address of the property where the proposed Medical Marijuana
Collective(s) will operate;
(2) A site plan describing the property with fully dimensioned interior
and exterior floor plans including electrical, mechanical, plumbing, and disabled
access compliance pursuant to Title 24 of the State of California Code of
Regulations and the federally mandated Americans with Disabilities Act;
(3) Exterior photographs of the entrance(s), exits(s), street frontage(s),
parking, front, rear and side(s) of the proposed property;
(4) Photographs depicting the entire interior of the proposed property;
(5) If the property is being rented or leased or is being purchased
under contract, a copy of such lease or contract;
(6) If the property is being rented or leased, written proof that the
property owner, and landlord if applicable, were given notice that the property will
be used as a Medical Marijuana Collective, and that the property owner, and
landlord if applicable, agree(s) to said operations;
(7) The name, address, telephone number, title and function(s) of each
manager, employee, volunteer, etc.;
(8) For each manager, employee, volunteer, a fully legible copy of one
valid government issued form of photo identification, such as State Driver's
License or Identification Card;
(9) If the Medical Marijuana Collective is a corporation, a certified copy
of the Collective's Secretary of State Articles of Incorporation, Certificate(s) of
Amendment, Statement(s) of Information and a copy of the Collective's Bylaws;
(10) If the Medical Marijuana Collective is an unincorporated
association, a copy of the Articles of Association;
(11) The name and address of the applicant's current agent for Service
of Process;
(12) A copy of the applicant's Board of Equalization Seller's Permit;
(13) A copy of the Medical Marijuana Collective Operating Standards,
listed in Section 18 -613, containing a statement dated and signed by the
responsible party on -site stating under penalty of perjury, that they read,
understand and shall ensure compliance with the aforementioned operating
standards.
The Chief of Police shall have sixty (60) calendar days in which to investigate the
application and background of the applicant. The department of building safety and
65C -20
housing, the fire department and the Orange County Health Department shall inspect
the premises proposed to be devoted to the collective establishment and shall make
separate recommendations to the Chief of Police or designee concerning compliance
with the foregoing provisions.
The Chief of Police or designee, after receiving the application and
aforementioned recommendations, shall grant the permit if he finds:
(1) The required fee has been paid.
(2) The application conforms in all respects to the provisions of this article.
(3) The applicant has not knowingly made a material misrepresentation in the
application.
(4) The applicant has fully cooperated in the investigation of his application.
(5) The applicant has not had a regulatory safety permit or other similar license
or permit denied or revoked for cause by this City or any other city located in or out of
this state within the five (5) years prior to the date of application.
(6) The collective as proposed by the applicant would comply with all applicable
laws including, but not limited to, health, zoning, fire and safety requirements.
(7) The applicant has demonstrated compliance with the California Department of
Justice, Office of the Attorney General, "Guidelines for the Security and Non - Diversion
of Marijuana Grown for Medical Use" standards.
18- 617.3. Medical marijuana collective — regulatory permit annual renewal
(a) Applications for the renewal of a permit shall be filed with the Chief of Police
at least sixty (60) calendar days before the expiration of the current permit. Temporary
permits will not be issued. Any permittee allowing his or her permit to lapse or which
permit expired during a suspension shall be required to submit a new registration
application and pay the corresponding original application fees.
(b) Any person desiring to obtain a renewal of his/her respective permit shall file
a written application under penalty of perjury on the required form with the Chief of
Police who shall conduct an investigation. The application shall be accompanied by a
nonrefundable filing fee established by separate resolution of the City Council to help
defray the cost of the investigation required by this article. An applicant shall be required
to update the information contained in his/her original permit application and provide
any new and /or additional information as may be reasonably required by the Chief of
Police in order to determine whether said permit should be renewed.
18.617.4 Maintenance of records.
65C -21
A Medical Marijuana Collective shall maintain records at the location accurately
and truthfully documenting: (1) the full name, address, and telephone number(s) of the
owner, landlord and /or lessee of the location; (2) the full name, address, and telephone
number(s) of all members who are engaged in the management of the collective and
the exact nature of each member's participation in the management of the collective; (3)
the full name, address, and telephone number(s) of all patient members to whom the
collective provides medical marijuana, a copy of a government- issued identification card
for all patient members; (4) the full name, address, and telephone number(s) of all
primary caregiver members to whom the collective provides medical; (5) all receipts of
the collective, including but not limited to all contributions, reimbursements, and
reasonable compensation, whether in cash or in kind, and all expenditures incurred by
the collective for the cultivation of medical marijuana; and (6) proof of compliance with
the California Attorney General Guidelines for the Security and Non- Diversion of
Marijuana Grown for Medical Use. These records shall be maintained by the collective
for a period of five years and shall be made available by the collective to the Police
Department and /or Community Preservation Division upon request. If they are not
produced as requested the City may seek a search warrant, subpoena, or court order.
In addition to all other formats that the collective may maintain, these records shall be
stored by the collective at the location in a printed format in its fire -proof safe. Any loss,
damage or destruction of the records shall be reported to the Police Department within
24 hours of the loss, destruction or damage.
18 -617.5 Audits.
Annual Audits. No later than February 15 of every year, each collective shall file
with the City one copy of an audit of its operations of the previous calendar year,
completed and certified by an independent certified public accountant in accordance
with generally accepted auditing and accounting principles. The audit shall include but
not be limited to a discussion, analysis, and verification of each of the records required
to be maintained pursuant to this article.
18 -618. Inspection and enforcement responsibilities.
The Community Preservation Division may enter and inspect the location of any
collective between the hours of 10:00 a.m. and 8:00 p.m., or at any reasonable time, to
ensure compliance with this article. In addition, a designated unit within the Police
Department may enter and inspect the location of any collective and the recordings and
records maintained as required by this article, except that the inspection and copying of
private medical records shall be made available to the Police Department only pursuant
to a properly executed search warrant, subpoena, or court order. It is unlawful for any
owner, landlord, lessee, member (including but not limited to a member engaged in the
management), or any other person having any responsibility over the operation of the
collective to refuse to allow, impede, obstruct or interfere with an inspection, review or
copying of records and closed- circuit monitoring authorized and required under this
article, including but not limited to, the concealment, destruction, and falsification of any
recordings, records, or monitoring.
10
65C -22
18 -619. Applicability to existing medical marijuana operations.
Any existing medical marijuana collective, dispensary, operator, establishment,
or provider that does not comply with the requirements of this article must immediately
cease operation until such time, if any, when it complies fully with the requirements of
this article. No medical marijuana collective, dispensary, operator, establishment, or
provider that existed prior to the enactment of this article shall be deemed to be a legally
established use under the provisions of this article, and such medical marijuana
collective, dispensary, operator, establishment, or provider shall not be entitled to claim
legal nonconforming status.
18.620. Compliance with this article and state law.
(a) It is unlawful for any person to (i) cause, permit or engage in the
cultivation, possession, distribution or giving away of marijuana or (ii) own establish,
operate, use or permit the establishment or operation of a medical marijuana collective
or cooperative, or to participate as an employee, contractor, agent or volunteer of a
collective or cooperative, except as provided in this article, and pursuant to any and all
other applicable local and state laws.
(b) It is unlawful for any person to cause, permit or engage in any activity
related to medical marijuana except as provided in Health and Safety Code Sections
11362.5 et seq., and pursuant to any and all other applicable local and state laws.
(c) It is unlawful for any person to knowingly make any false, misleading or
inaccurate statements or representations in any forms, records, filings or documentation
required to be maintained, filed or provided to the City under this article, or to any other
local, state or federal government agency having jurisdiction over any of the activities of
collectives.
(d) It shall be the sole responsibility of the members engaged in the
management of the collective to ensure that the collective is at all times operating in a
manner compliant with all applicable state laws and this article. Nothing in this article
shall be construed as authorizing any actions which violate state law with regard to the
cultivation, transportation, provision, and sale of medical marijuana.
18 -621. Violation and enforcement.
Each and every violation of this article shall constitute a separate violation and
shall be subject to all remedies and enforcement measures authorized by this
Municipal Code. Additionally, as a nuisance per se, any violation of this article shall be
subject to injunctive relief, revocation of the collective's registration, revocation of the
certificate of occupancy for the location, disgorgement and payment to the City of any
and all monies unlawfully obtained, costs of abatement, costs of investigation, attorney
fees, and any other relief or remedy available at law or equity. The City may also
11
65C -23
pursue any and all remedies and actions available and applicable under local and state
laws for any violations committed by the collective and persons related or associated
with the collective.
SECTION 3. Section 41 -121 of the Santa Ana Municipal Code is hereby
deleted in its entirety.
SECTION 4. Subsection (b) of Section 41 -144 of the Santa Ana Municipal
Code is hereby deleted in its entirety.
SECTION 5. Chapter 21, Article XII of the Santa Ana Municipal Code,
comprised of sections 21 -126, 21 -127, 21 -128, 21 -129 and 21 -130, is hereby added
such that it reads as follows:
Sec. 21 -126. Purpose.
This article is required for the purpose of fixing the rate of taxation for Marijuana
Collectives/Cooperatives and for the purpose of providing a tax levy for the usual and
current expenses of the City of Santa Ana. The taxes required to be paid under this
article are declared to be required pursuant to the taxing power of the City of Santa Ana
solely for the purpose of obtaining revenue and are not regulatory permit fees.
Sec. 21 -127. Marijuana collectives /cooperatives — Annual business license
tax assessment.
(a) Annual business license tax assessment for Marijuana Collectives/
Cooperatives:
(1) Every Collective /Cooperative whether it is organized or conducted
as a "not for profit' business, a "non - profit' business, or a "for - profit' business,
shall pay an annual business license tax in accordance with Chapter 21 of this
Code and the Sections and Subsections hereunder.
(2) For the purposes of this article, a Marijuana Collective /Cooperative
is defined in section 18 -611 of this Municipal Code and is considered to be a
business as that term is defined in Section 21 -3 of this Chapter.
(3) For the purposes of this article, a Collective /Cooperative is not
considered to be a religious or charitable organization.
(4) "Medical Marijuana Collective /Cooperative' or "Collective/
Cooperative" shall mean any activity regulated or permitted by Chapter 18 of this
Municipal Code.
(5) For the purposes of this article, a Marijuana Collective /Cooperative
is not considered to be a business or person having a "specified exemption" or
"specified exclusion" from business license taxation as set forth in Sections 21 -48
12
65C -24
and 21 -49 of this Chapter.
(6) For the purposes of this article, a Nonprofit Organization" shall
mean any institution or organization that is exempted from taxes measured by
income or gross receipts pursuant to Article XIII, Section 26 of the California
Constitution as codified under Chapter 4 (commencing with Section 23701) of
Part 11 of Division 2 of the Revenue and Taxation Code and Section 37101 (c) of
the Government Code or Sub - Chapter F (commencing with Section 501) of
Chapter 1 of Subtitle A of the Internal Revenue Code of 1986. An institution or
organization operating as a Collective /Cooperative and claiming a gross receipts
assessment business license tax exemption under this section shall have the
burden of furnishing to the collector such information as the collector may require
to validate the claim of exemption including but not limited to such a
determination by the California Franchise Tax Board or any other information
requested by the collector.
(7) For the purposes of this article, "gross receipts" shall mean any
transfer of title or possession, exchange or barter, conditional or otherwise, in
any manner or by any means whatsoever, of tangible personal property for a
consideration including any monetary consideration for marijuana whatsoever,
including, but not limited to, membership dues, reimbursements provided by
members, regardless of form, or the total amount of cash or in -kind contributions,
including all operating costs related to the growth, cultivation or provision of
marijuana or any transaction related thereto. "Gross receipts" shall also include
without limitation anything else of value obtained by a Collective /Cooperative.
The term "gross receipts" shall also include the total amount of the sale price of
all sales, the total amount charged or received for the performance of any act,
service or employment of whatever nature it may be, whether or not such
service, act or employment is done as a part of or in connection with the sale of
goods, wares, merchandise, for which a charge is made or credit allowed,
including all refunds, cash credits and properties of any amount or nature, any
amount for which credit is allowed by the seller to the purchaser without any
deduction therefrom, on account of the cost of the property sold, the cost of
materials used, the labor or service cost, interest paid or payable, losses, or any
other expense whatsoever; provided that cash discounts allowed or payment on
sales shall not be included. "Gross receipts" shall also include the amount of any
federal, manufacturer's or importer's excise tax included in the price of property
sold, even though the manufacturer or importer is also the retailer thereof and
whether or not the amount of such tax is stated as a separate charge. "Gross
receipts" shall not include the amount of any federal tax imposed on or with
respect to retail sales whether or not the amount of such tax is stated as a
separate charge. 'Gross receipts shall not include the amount of any federal tax
imposed on or with respect to retail sales whether imposed upon the retailer or
the consumer and regardless of whether or not the amount of federal tax is
stated to customers as a separate charge, or any California state, city or city and
county sales or use tax required by law to be included in or added to the
purchase price and collected from the consumer or purchaser, or such part of the
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65C -25
sales price of any property previously sold and returned by the purchaser to the
seller which is refunded by the seller by way of cash or credit allowances given or
taken as part payment on any property so accepted for resale. "Gross receipts"
shall be calculated without any deduction on account of any of the following:
(i) The cost of tangible property sold or bartered;
(ii) The cost of materials or products used, labor or service cost,
interest paid, losses, or other expense; or
(iii) The cost of transportation of the marijuana, or other property
or product.
(b) Business license tax rates for Marijuana Collectives /Cooperatives
(1) Every Collective /Cooperative, excepting a qualified "Nonprofit
Organization ", whether it is organized or conducted as a "not for profit" business,
a "non - profit' business, or a 'for- profit' business, shall pay a separate business
license tax at a rate of up to ten percent (10 %) of the gross receipts generated or
otherwise received for each branch establishment or separate property location
of the business. The gross receipts tax shall be initially set at a rate of five
percent (5 %). The maximum tax rate shall not exceed ten percent (10 %) of
gross receipts. This tax shall not be adjusted for inflation pursuant to Section 21-
121 of this Chapter.
(2) Notwithstanding the maximum tax rate of ten percent (10 %) of
gross receipts imposed under subsection (b)(1), the City Council may in its
discretion at any time by ordinance implement a lower gross receipts tax rate for
all Marijuana Collectives /Cooperatives, as defined in such ordinance, subject to
the maximum rate of ten percent (10 %) of gross receipts. The City Council may
by ordinance increase any such gross receipts tax rate from time to time, not to
exceed the maximum gross receipts tax rate established under subsection (b)(1).
(3) As part of the gross receipts tax imposed by this article, each
Collective /Cooperative shall pay a minimum basic rate of two thousand dollars
annually for each separate branch location or separate property location of the
business.
(c) Modification, Repeal or Amendment.
The City Council may repeal the ordinance codified in this article, or amend it in a
manner which does not result in an increase in the tax or taxes imposed herein, without
further voter approval. The City Council may likewise by ordinance adopt and add
additional provisions to any other article of this Chapter and relate them to this article, or
amend any existing provisions of any article of this Chapter as they may already relate
to this article in any manner which does not result in an increase in the tax or taxes
imposed herein, without further voter approval. If the City Council repeals said
ordinance or any provision of this article, it may subsequently reenact it without voter
14
65C -26
approval, as long as the reenacted ordinance or section does not result in an increase
in the tax or taxes imposed herein.
(d) Administration - rules, regulations, and guidelines; interpretation/
clarification.
In order to aid in the City's collection of taxes due under this article and to ensure
that all Marijuana Collectives /Cooperatives are taxed consistently to the best of the
City's ability, the collector, with the concurrence of the City Attorney, may promulgate
rules, regulations, and guidelines, to implement and administer this article including, but
not limited to rules, regulations, and guidelines harmonizing other provisions of this
Chapter with the provisions of this article in any manner not inconsistent with the intent
of this article and which does not result in an increase in the tax or taxes imposed
herein. The collector may also, with the concurrence of the City Attorney, interpret or
clarify the methodology of the tax, or any definition applicable to the tax, so long as such
interpretation or clarification (even if contrary to some prior interpretation or clarification)
is not inconsistent with the language of this article.
(e) Occasional transactions — Exemptions.
(1) The provisions of this article shall not apply to persons having no
fixed place of business within the City of Santa Ana who come into the City for
the purpose of transacting a specific item of Marijuana Collective /Cooperative
business at the request of a specific patient, client or customer, provided that
such person does not come into the City for the purpose of transacting business
on more than five days during any calendar year.
(2) For any person not having a fixed place of business within the City
of Santa Ana who comes into the City for the purpose of transacting
Collective /Cooperative activities, the business tax payable by such person may
be apportioned by the collector in accordance with this Chapter.
(f) Reporting and Remittance.
Beginning as set forth in subsection (k) below, and monthly thereafter, each
Marijuana Collective /Cooperative (except qualified Nonprofit Organizations exempt from
taxes measured by income or gross receipts) required to pay a tax based on gross
receipts under this article, shall report to the City any gross receipts received during the
preceding monthly reporting period and shall likewise remit to the City the taxes due
and owing during said period. For purposes of this section, month shall mean calendar
month, and taxes shall begin to accrue on the date that a person or entity first receives
a business license or other permit to operate as a Collective /Cooperative.
The payment of the two thousand dollars minimum basic rate gross receipts tax
required annually for each separate branch location or separate property location of the
business in accordance subsection (b)(3), shall be made annually prior to the beginning
of the fiscal year beginning April first of the current year and expiring on the thirty -first
15
65C -27
day of March of the following year. In the case of a new Collective /Cooperative the
minimum basic rate gross receipts tax shall be paid in advance prior to any new
business activity being undertaken. Every new licensee shall pay in advance an
amount equal to one - quarter ('/4) of the annual minimum basic rate gross receipts tax,
for each quarter and fraction of a quarter remaining during the period for which the new
license is issued.
(g) Delinquent date - Penalty.
Any individual or entity who fails to pay the taxes required by this article when
due shall be subject to penalties and interest as set forth in accordance with this
Chapter. The collector is not required to send a delinquency or other notice or bill to
any person subject to the provisions of this Chapter and failure to send such notice or
bill shall not affect the validity of any tax or penalty due under the provisions of this
Chapter.
(h) Payment of tax does not authorize unlawful business.
(1) The payment of a business tax required by this article, and its
acceptance by the City, shall not entitle any person to carry on any
Collective /Cooperative unless the person has complied with all of the
requirements of this Code and all other applicable laws, nor to carry on any
Collective /Cooperative in any building or on any premises in the event that such
building or premises are situated in a zone or locality in which the conduct of
such Collective /Cooperative is in violation of any law.
(2) No tax paid under the provisions of this article shall be construed as
authorizing the conduct or continuance of any illegal or unlawful business, or any
legal business in an illegal manner, or any business in violation of any ordinance
of the City. Nothing in this article implies or authorizes that any activity
connected with the distribution or possession of marijuana is legal unless
otherwise authorized and allowed by California and federal law. Nothing in this
section shall be applied or construed as authorizing the sale of marijuana.
(i) Business license tax certificate - Required.
There are imposed upon all persons engaged in transacting and carrying on any
Collective /Cooperative business activity in the City taxes in the amounts prescribed in
this article. It shall be unlawful for any person, either for him or herself or for any other
person, to commence, transact or carry on any business in the City without first having
procured a business license from the City under this Chapter and having paid the taxes
set forth in this article, and without complying with any and all applicable provisions
contained in this Chapter. The carrying on of any Collective /Cooperative without
complying with all the provisions of this article shall constitute a separate violation of this
Chapter for each and every day that such Collective /Cooperative is so carried on.
Q) Classification of business license assessment type — term and renewal.
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65C -28
The business license issued to Marijuana Collectives/Cooperatives shall be
classed as a gross receipts assessment type, issued for the same term of license as set
forth in Section 21 -71 (c) and shall be subject to renewal in accordance with Sections
21- 72(c), 21- 73(c), and 21 -77 of this Chapter.
(k) Operative Date.
Upon the approval by the majority of the voters of the City of Santa Ana at the
November 4, 2014 general election, the taxes imposed by this article shall become
operative and shall be applied by the collector upon all Marijuana
Collectives /Cooperatives.
Sec. 21 -128. Effect of state and federal reference /authorization.
Unless specifically provided otherwise, any reference to a State or Federal
statute in this article or Chapter shall mean such statute as it may be amended from
time to time, provided that such reference to a statute herein shall not include any
subsequent amendment thereto, or to any subsequent change of interpretation thereto
by a State or Federal agency or court of law with the duty to interpret such law, to the
extent that such amendment or change of interpretation would require voter approval
under California law, or to the extent that such change would result in a tax decrease.
Only to the extent voter approval would otherwise be required or a tax decrease would
result, the prior version of the statute (or interpretation) shall remain applicable; for any
application or situation that would not require voter approval or result in a decrease of a
tax, provisions of the amended statute (or new interpretation) shall be applicable to the
maximum possible extent.
To the extent that the City's authorization to collect or impose any tax imposed
under this article is expanded or limited as a result of changes in State or Federal law,
no amendment or modification of this article shall be required to conform the tax to
those changes, and the tax shall be imposed and collected to the full extent of the
authorization up to the full amount of the tax imposed under this article.
Sec. 21 -129. Violation deemed misdemeanor - penalty.
Any person violating any of the provisions of this article or any regulation or rule
passed in accordance herewith, shall be deemed guilty of a misdemeanor, and upon
conviction thereof shall be punishable by the maximum penalties provided for in Penal
Code section 19.
Sec. 21 -130. Severability.
Should any provision of this article, or its application to any person or
circumstance, be determined by a court of competent jurisdiction to be unlawful,
unenforceable or otherwise void, that determination shall have no effect on any other
provision of this article or Chapter or the application of this article or Chapter to any
other person or circumstance and, to that end, the provisions hereof are severable.
17
65C -29
SECTION 6. Council to Make Future Amendments to Voter Approved
Ordinance. This is a City Council sponsored initiative ordinance which traditionally
would only be subject to amendment by the Voters of the City of Santa Ana. However,
pursuant to Section 9217 of the California Elections Code the City Council reserves the
right and authority to amend or repeal the ordinance without any restrictions.
SECTION 7. Severability. If any provision of this Ordinance or the application
thereof to any person or circumstance is held invalid, such invalidity shall not affect
other provisions or applications of the Ordinance which can be given effect without the
invalid provision or application, and to this end the provisions of this ordinance are
severable. The People of the City of Santa Ana hereby declare that they would have
adopted this Ordinance irrespective of the invalidity of any particular portion thereof.
SECTION 8. Effective Date. After its adoption by the voters, this ordinance
shall be in full force and effect ten (10) days after the vote is declared by the legislative
body, pursuant to the provisions of Elections Code sections 9217 and 15400 and as
provided by law.
SECTION 9. Competing Measures. In the event that this measure and another
measure or measures relating to the regulation of medical marijuana in the City of Santa
Ana appear on the same ballot, the provisions of the other measure or measures shall
be deemed to be in conflict with this measure. In the event that this measure shall
receive a greater number of affirmative votes required to pass than the other measure
or measures, the provisions of this measure shall prevail in their entirely over the
competing measure or measures, and the competing measure or measures shall be null
and void.
iI3
65C -30
Medical Marijuana Ordinance
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65C -31
Medical Marijuana Ordinance — Dates / Action Items
Date
Action
Now— December 17, 2014
Begin preparing forms, applications and administrative
policy
December 9, 2014
Election Results certified by the City Council (Date of
Adoption)
December 16, 2014
Resolution adopting Medical Marijuana Registration
Processing Fee and Regulatory Safety Permit Fee
December 17, 2014
Release Medical Marijuana Registration application
December 17, 2014 — January 15, 2015
Application submittal period (Educational
workshops /outreach to applicants during this period)
January 16, 2015— January 25, 2015
Review received applications for compliance
Notify applicants of registration status and provide
January 26, 2015
Selection Process Information (Date, Location, Format,
etc.)
February 5, 2015
Hold Selection Process (February 7th is last date per
initiative)
February 5, 2015
Applicants placed on qualified registration list
February 6, 2015
Regulatory Safety Permit Application period begins
Regulatory Safety Permit processing period: 60 -days from receipt of a completed application
* Within 30 -days
65C -32