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HomeMy WebLinkAboutPOWERPOINT - WS-2_COMMERCIAL CANNABIS STUDY SESSION PRESENATION DOUBLE COLUMN v3 COMMERCIAL CANNABIS STUDY SESSION 1 OVERVIEW Background on current ordinances • General recommendations • Other commercial cannabis types • Descriptions • Analysis and recommendations • 2 BACKGROUND Permitted • Medicinal Cannabis retail, 2014 • Adult-use Cannabis retail, 2017 • Prohibited Non-Retail Commercial • Cannabis activity: Testing • Manufacturing (processing) • Distribution (warehousing) • Cultivation • Microbusinesses • 3 CURRENT STATUS Allow retail (storefront) license types: • Adult-use • Medicinal • Retail stores may hold delivery (non-storefront) • licenses 18 retailers are operational • The Phase 1 application period for • “newcomer” applicants closed March 1 4 NON-RETAIL CANNABIS USES Cultivation, manufacturing, warehousing, and testing are: Non-public in nature • High-technology industries • Already permitted in Santa Ana’s industrial • zones (for non-cannabis purposes) Components of a larger supply chain that • supports an existing industry 5 RECOMMENDATIONS For Non-RetailMedicinal and Adult Cannabis: Maintain 1,000-foot buffer from sensitive land uses • (schools, parks, and residential zones) Allow in M-1 and M-2 (industrial) zoning districts • No cap on the number of permits issued • No separation requirements between each type of • business 6 CULTIVATION Building Type and Facility: Outdoor, greenhouses, • or in large warehouse- style buildings Regulation: Allow only indoor • Permit in the City’s light • and heavy (M-1 and M- 2) industrial districts. 7 CULTIVATION ANALYSIS Expected to satisfy local Resource-intensive •• boutique, niche markets Opportunities for rooftop solar • installation Can be ancillary to Santa • City may require or provide • Ana’s cannabis retail businesses incentives for purple pipes Able to be accommodated by • (recycled water) Santa Ana’s broad range of Green waste • industrial building types and Green waste may be used for • sizes energy purposes Revenue generation • California has stringent green • potential -abundant amount waste disposal requirements of industrial square footages Land grab/glut • Interior areas can be • Large grow facilities already • maximized exist in areas with cheaper real estate 8 MANUFACTURING Building Type and Facility: Typically 500 to 2,500 • square feet Regulation Generally divided into two • general categories: Volatile • Non-volatile • Both types could be • accommodated by the City’s light and heavy (M-1 and M-2) industrial districts 9 MANUFACTURING ANALYSIS Highly-educated, “white Odor concerns •• collar” employees • In early-adopting states, odor control technology was Requires high-value, high- • developed tech equipment • Require routine odor studies Expected to be ancillary to • • Require routine inspections Santa Ana’s cannabis retail Fire safety • businesses • OCFA has proactively Capitalize on Santa Ana’s • developed cannabis industrial areas manufacturing guidelines • City can limit or ban volatile Revenues: • manufacturing • Business-to-business taxes • Gross receipts taxes from high- tech equipment purchases 10 DISTRIBUTION Building Type and Facility: Industrial or warehouse • buildings Regulation Can transport products only • on a wholesale basis; direct sales to consumers (retail) is prohibited 11 DISTRIBUTION ANALYSIS Strategic positionImpacts on roadways •• •• Freeways and major roadwaysCannabis is a lightweight good •• Rail linesDoes not require large “18- wheeler” trucks • Airport for intrastate transport Impacts on existing industrial • • Large amount of industrial areas buildings Revenues: • • Parking • Daytime employees • Business-to-business taxes • Facilities are high-tech, • Gross receipts taxes from high- automated tech equipment purchases Land grab/glut • • Local market can bear 1-3 large distribution facilities • Expected to satisfy local brands 12 TESTING Building Type and Facility: Industrial buildings from • 500 to 5,000 square feet; the average facility size is 2,500 square feet Regulation: Testing is required by the • State of California to ensure product safety, integrity, and quality For medicinal products, • also ensures compliance with dosage requirements 13 TESTING ANALYSIS Can thrive in Santa AnaConfusion between “R&D” and •• “testing” Existing cannabis industry • presence Testing facilities must be licensed • by the State Proximity to a large pool of • qualified, white-collar workers City can adopt ordinance to only • permit testing, but no R&D Santa Ana has a thriving R&D • Testing facilities may not hold industry• any other license type, including Highly-educated, “white collar” • retail employees Odor concerns • Generates business-to-business • Testing requires very small • taxes quantities –undetectable smell Requires high-value, high-tech •from outside equipment City collects gross receipts taxes • 14 MICROBUSINESS Recommend against allowing microbusinesses • Microbusiness license holders could circumvent the City’s cap on • retail cannabis stores A microbusiness license is not required for businesses holding • multiple licenses and license types at one location A microbusiness could hold a retail license, combined with other • licenses, but conduct 99 percent of its business activity in retail • The State does not mandate a certain proportion of each business activity in the facility • Local jurisdiction may not allow microbusinesses without the retail component 15 NEXT STEPS March 6 • Ordinance amendments to allow testing facilities in • the industrial zones Study Session on other commercial cannabis uses • (cultivation, manufacturing, and distribution) Spring 2018 –Aim to get testing laboratories • operational Summer 2018 –Aim to get additional retailers • operational 16 DISCUSSION 17 18