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Home My WebLink About75B - PH - RESO - MM APP FEESREQUEST FOR COUNCIL ACTION CITY COUNCIL MEETING DATE: DECEMBER 16, 2014 TITLE: PUBLIC HEARING - RESOLUTION ESTABLISHING FEES FOR MEDICAL MARIJUANA REGISTRATION APPLICATION AND REGULATORY SAFETY PERMIT {STRATEGIC PLAN NOS. 4 -2A, 1 -1F} f��= � 44 'CITY MANAGER RECOMMENDED ACTION CLERK OF COUNCIL USE ONLY: _••:• I, ❑ As Recommended ❑ As Amended ❑ Ordinance on 1" Reading ❑ Ordinance on 2nd Reading ❑ Implementing Resolution ❑ Set Public Hearing For CONTINUED TO FILE NUMBER Adopt a resolution establishing fees for Medical Marijuana Registration Application and Regulatory Safety Permit in accordance with Ordinance Number NS -2864. DISCUSSION Since the approval of Measure BB by the voters on November 4, 2014, staff has begun developing the required processes and procedures to implement Ordinance Number NS -2864. The adopted Ordinance establishes a two -step process for determining appropriate locations for potential medical marijuana collectives /cooperatives and ensuring that operators at these locations meet the adopted development and operational requirements. The Ordinance also provides for the establishment of a City Council approved no- refundable processing fees for both the Registration Application and Regulatory Safety Permit components in the approval process. The recommended fees will recover 100 percent of the City's costs associated with the design, and implementation of these two applications, while the taxing components are established to ensure sufficient revenue for the ongoing enforcement of the Ordinance and any potential impacts of medical marijuana collectives. Medical Marijuana Registration Application Fee The Medical Marijuana Registration Application is the first step in the process, and is primarily responsible for ensuring that the proposed location is within the eligible area as established in the Ordinance. The application also requires confirmation that the applicant is authorized by the property owner to operate a medical marijuana collective /cooperative at the specified location. Further, Section 18- 617.01 of the Ordinance states that each collective /cooperative interested in operating within the City must submit an application together with a non - refundable processing fee established by the City Council. The methodology used to determine the appropriate fee amount included both the direct and indirect costs associated with providing the service. Direct costs were calculated by determining the actual time and materials involved in processing the 7513-1 Medical Marijuana Registration Application & Regulatory Safety Permit Fees December 16, 2014 Page 2 applications from the submittal of the application through the lottery process. Indirect costs, including interdepartmental assistance from the City Attorney's Office, City Manager's Office, Public Works Agency and Finance and Management Services Agency, were calculated based on the total expenses associated with the Registration Application process and then divided by the anticipated number of applications received. This methodology is similar to the one used to calculate full cost recovery fees within the Planning and Building Agency. Based on the anticipated volume of Registration Applications for medical marijuana collectives/ cooperatives, at full cost recovery, the Registration Application is recommended to be $1,690. Regulatory Safety Permit Based on the results of the Registration Application, a limited number of medical marijuana collectives /cooperatives will be eligible to apply for the Regulatory Safety Permit. Section 18- 617.2 of the adopted Ordinance specifies that applications will be submitted to the Police Department for review and background checks. The Police Department will have 60 -days to review the submitted application and make a determination on the Permit. The 60 -day background period shall commence once the applicant and all employees of the collective /cooperative have submitted complete background applications which will be provided by the Police Department. The determination of whether the application is complete and 60 -day review process is ready to commence shall be at the discretion of the Chief of Police or his designee. During the 60 -day review period, the Police Department will perform a thorough background check process including: 1. Check of the California Law Enforcement Telecommunications System (CLETS), National Crime Information Center (NCIC), and local arrest/conviction databases, including criminal histories of AKA's of all applicants. 2. Contact and follow up with persons /entities listed in background application to determine accuracy of applicant statements. 3. Facilitation of Live -Scan testing for applicants and review of results or discrepancies. 4. Research of past applications for medical marijuana collectives /cooperatives with other jurisdictions. 5. Signed acknowledgment by owner /operator that he /she will comply with all applicable health, zoning, fire, safety requirements, and that they are compliant with the California Department of Justice (DOJ) guidelines. Following the completion of the background check review, the second component of the Regulatory Safety Permit process is the on -site inspection. This will be performed by staff from the Police Department, Planning and Building Agency, Orange County Fire Authority and Orange 75B -2 Medical Marijuana Registration Application & Regulatory Safety Permit Fees December 16, 2014 Page 3 County Health Department (if food products are proposed for sale). This on -site inspection will occur prior to opening for business and will ensure that the proposed collective /cooperative meets the operational and site requirements outlined in the Ordinance. These include such items as the installation of closed- circuit cameras, licensed on -site security guard, compliant signage, suitable ventilations systems, as well as all applicable building code standards such as exiting and accessibility. Similar to the Registration Application, the methodology used to determine the appropriate fee to recover the full costs associated with the development, review, and maintenance of the Regulatory Safety Permit were considered. Based on this analysis, to provide a thorough background check and inspection process the proposed fee for the Regulatory Safety Permit is $12,086. STRATEGIC PLAN ALIGNMENT Approval of this item supports the City's efforts to meet Goal No. 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) as well as Goal No. 4 City Financial Stability, Objective No. 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). FISCAL IMPACT Based on the anticipated number of Registration Applications and Regulatory Safety Permits received, City staff estimates the fees will generate $169,000 in Registration Application revenue and $241,720 in Regulatory Safety Permits (Account No. 01116002- 53626). It is important to note that while the Registration Application revenue is a one -time fee per application, the Regulatory Safety Permit revenue will be received annually as part of the Regulatory Safety Permit renewal process. Vince Fregos Interim Executive- erector Planning & Building Agency MF:rb mflreports \Medical Marijuana Fee RFCA APPROVED AS TO FUNDS AND ACCOUNTS: Francisco Gutierrez Executive Director Finance & Management Services Agency J 75B -3 75B -4 ROH: 12/16/14 RESOLUTION NO. 2014 -xx A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA ANA ESTABLISHING FEES FOR THE MEDICAL MARIJUANA REGISTRATION APPLICATION AND THE REGULATORY SAFETY PERMIT IN ACCORDANCE WITH ORDINANCE NUMBER NS -2864 BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SANTA ANA AS FOLLOWS: Section 1. The City Council of the City of Santa Ana hereby finds, determines and declares as follows: A. Ordinance Number NS -2864, approved as Measure BB by the voters on November 4, 2014, establishes a two -step process for determining appropriate locations for potential medical marijuana collectives / cooperatives and ensuring that operators at these locations meet the adopted development and operational requirements. The Ordinance also provided that the City Council may establish non - refundable processing fees for both the Registration Application and Regulatory Safety Permit components in the approval process. B. Section 18- 617.01 of the Santa Ana Municipal Code states that each collective / cooperative interested in operating within the City must submit an application together with a non - refundable processing fee established by the City Council. C. Based on the anticipated volume of Registration Applications for medical marijuana collectives / cooperatives, at full cost recovery, the Registration Application is recommended to be $1,690. D. Section 18 -617.2 of the Santa Ana Municipal Code also specifies that applications must be submitted to the Police Department for an annual Regulatory Safety Permit, along with a non- refundable fee as established by the City Council for the cost of the required review and investigation. E. Based on an analysis of the required thorough background check and inspection process, the proposed fee for the Regulatory Safety Permit is $12,086. The City Council hereby incorporates, as though fully set forth herein, the Request for Council Action accompanying this matter. 75B_5 Resolution No. age 1 of 3 Section 2. The City Council hereby establishes the following fees relating to medical marijuana collectives and cooperatives: A. The Registration Application fee in the amount of $1,690. B. The Regulatory Safety Permit fee in the amount of $12,086. Section 3. That without further action of the City Council the Registration Application fee and the Regulatory Safety Permit fee shall be incorporated into the City's Miscellaneous Fee Schedule. ADOPTED this day of 2014. APPROVED AS TO FORM: Sonia R. Carvalho, City Attorney i ge Ci Attorney AYES: NOES: ABSTAIN: NOT PRESENT: Resolution No. 2014 -xx Page 2 of 3 Councilmembers Councilmembers Councilmembers Councilmembers Miguel A. Pulido Mayor 75B -6 CERTIFICATE OF ATTESTATION AND ORIGINALITY I, MARIA D. HUIZAR, Clerk of the Council, do hereby attest to and certify the attached Resolution No. 2014 -xx to be the original resolution adopted by the City Council of the City of Santa Ana on Date: Clerk of the Council City of Santa Ana 75B -7 Resolution Page 3 of 3 75B -8