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