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Section 3: Article I of Chapter 40 of the Santa Ana Municipal Code is hereby amended to read in full as follows: Chapter 40 ARTICLE 1. REGULATION OF COMMERCIAL CANNABIS ACTIVITIES OTHER THAN MEDICINAL CANNABIS RETAIL ACTIVITIES Section 40-1. Purpose and Intent. A. The purpose and intent of this article is to regulate commercial cannabis business activities, as defined in this article, in order to ensure the health, safety and welfare of the residents of the City of Santa Ana by establishing regulations necessary for commercial cannabis business operating in the City of Santa Ana to obtain and maintain a Regulatory Safety Permit ('RSP"). Any commercial cannabis businesses operating in the City of Santa Ana shall at all times be in compliance with current State Law and this article. All commercial cannabis facilities shall operate in accordance with the regulations in this article and with the conditions of approval associated with the applicable zone for the parcel of real property upon which the commercial cannabis activities are conducted. Any commercial cannabis business shall qualify for and receive a Regulatory Safety Permit from the City of Santa Ana as provided by this article and operate only in a zone in compliance with Santa Ana Municipal Code before commencing with any commercial cannabis business activity. Any commercial cannabis business without a Regulatory Safety Permit is in violation of this article. The regulations in this article, in compliance with the Compassionate Use Act, the Medicinal Marijuana Program Act, SB 94, AB 133, Proposition 64, and the California Health and Safety Code (collectively referred to as "State Law") do not interfere with the right to use adult -use cannabis or medicinal cannabis as authorized under State Law, nor do they criminalize the possession of cannabis as authorized under State Law. All other commercial cannabis activities, including but not limited to, cultivation, manufacture, and distribution are prohibited and banned in the City of Santa Ana. B. Any person operating a medicinal marijuana collective/cooperative (as defined in Chapter 18 of this Code) as of December 14, 2017, or who has a RSP application pending to operate a medicinal collective/cooperative, and has met all of the requirements of Chapter 18, shall be allowed to apply for a Regulatory Safety Permit for the sale of Adult -Use cannabis provided that they enter into the Adult -Use Cannabis Retailer Operating Agreement with the City. C. The Commercial Cannabis Operating Agreement shall be a legally binding written agreement between each commercial cannabis business operator and the City, executed by the City Manager, or his or her designee, and in a form and substance satisfactory to the Executive Director of Planning and Building and the City Attorney, and containing those provisions necessary to ensure that the requirements of this article are satisfied. Section 40-2. Definitions. Ordinance No. NS -2942 Page 3 of 31