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REQUEST FOR <br />COUNCIL ACTION <br />CITY COUNCIL MEETING DATE: <br />AUGUST 20, 2019 <br />TITLE: <br />PUBLIC HEARING —APPROVE ORDINANCE <br />AMENDMENT NO. 2019-01 TO AMEND CERTAIN <br />SECTIONS OF CHAPTERS 18, 21, AND 40 OF <br />THE SANTA ANA MUNICIPAL CODE ALLOWING <br />VERTICAL AND HORIZONTAL INTEGRATION <br />OF CANNABIS BUSINESSES; UPDATING <br />OWNERSHIP TRANSFERS, PROCEDURAL <br />STANDARDS AND REQUIREMENTS, SECURITY <br />DEPOSITS, AND VARIOUS ADMINISTRATIVE <br />PROCESSES; UPDATING AND STREAMLINING <br />REGULATORY COMPONENTS; REDUCING <br />CANNABIS TESTING TAXES TO TWO PERCENT <br />OF GROSS RECEIPTS; ADOPTING A CANOPY <br />MEASUREMENT AND SQUARE FOOTAGE <br />ALLOCATION SERVICE FEE; AND <br />AUTHORIZING AMENDMENT OF THE <br />COMMERCIAL CANNABIS OPERATING <br />AGREEMENT TEMPLATE <br />(STRATEGIC PLAN NOS. 3, 2; 3, 3; 3, 5; 4,3) <br />CLERK OF COUNCIL USE ONLY: <br />APPROVED <br />❑ As Recommended <br />❑ As Amended <br />❑ Ordinance on 181 Reading <br />❑ Ordinance on 2n° Reading <br />❑ Implementing Resolution <br />❑ Set Public Hearing For <br />CONTINUED TO <br />FILE NUMBER <br />CITY MANAGER <br />RECOMMENDED ACTION <br />Adopt an ordinance allowing vertical integration of certain commercial cannabis businesses; <br />updating operational and procedural standards for implementing the City's medicinal and <br />commercial cannabis ordinances, decrease security deposit amount requirements, compute <br />square footage cannabis taxes based on allocation of gross square footage usage; and <br />reducing the commercial cannabis testing laboratory tax from five (5) to two (2) percent. <br />2. Adopt an ordinance amending various sections of Chapters 18 and 40 of the Santa Ana <br />Municipal Code addressing medicinal cannabis purchasing age, employee badges, <br />manufacturing permit requirements, and ordinance administration and implementation. <br />3. Adopt a resolution reducing the gross receipts tax on commercial cannabis testing <br />laboratories from five (5) to two (2) percent. <br />4. Adopt a resolution implementing a canopy measurement service fee and an allocated square <br />footage measurement service fee to cover the City's cost in independently verifying the <br />allocation of square footage usage by commercial cannabis businesses. <br />75A-1 <br />