Agenda Item Wording:
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Cannabis Ordinance Discussion - Provide staff with direction on preliminary Cannabis Ordinance content and structure.
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Deadline for Action: 7/21/2025
Submitting Department: Community Development
Contact Name and Phone Number:
Devon Jones, Economic Development Manager, devon.jones@visalia.city, (559) 713-4190; Paul Bernal, Planning and Community Preservation Director, paul.bernal@visalia.city, (559) 713-4025
Department Recommendation:
Receive staff report and presentation and provide staff with direction for the preliminary Cannabis Ordinance and business application process content and structure.
Summary:
On May 5, 2025, staff provided City Council with a Work Session staff report and presentation regarding direction and input on a Cannabis Ordinance and business application process that could be drafted and potentially considered for Council adoption but with a clear understanding that the number of businesses permitted to operate in the City of Visalia would be zero, based on current Council direction, which effectively establishes the regulatory framework for such businesses but would not permit such businesses from operating within the City of Visalia.
During the Work Session discussion, six specific items were discussed with the City Council to seek input and direction on these items to be addressed in the framework and structure of a Cannabis Ordinance. The six items, and subsections of these items are noted as follows:
1. Where in the municipal code should the cannabis business ordinance be placed?
2. Which uses or business types does the City want included or excluded? What zones would the City like to allow the various business types in?
There are seven California Department of Cannabis Control (DCC) license types as follows <https://cannabis.ca.gov/applicants/license-types/>:
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1. Cultivation |
2. Manufacturing |
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3. Distribution |
4. Testing laboratory |
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5. Retail |
6. Microbusiness |
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7. Event |
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3. What sensitive uses would the City like to identify, and what size buffers?
4. Hours of operation restrictions?
5. Additional security measures?
6. Term of license?
The City Council provided direction on some of the key items and also directed staff to do additional research on the following:
1. Additional analysis for Council consideration on whether Microbusiness should be an allowed cannabis business model/use in the Cannabis ordinance.
2. Provide several maps to identify what potential buffers and sensitive receptor uses would provide in terms of available sites for consideration for retail cannabis uses.
3. Research larger cities to determine on how these jurisdictions address buffer requirements from sensitive land uses and separation distance requirements from other cannabis retail establishments.
Additionally, staff is seeking clarity from Council with two particular matters at this time:
1. Clarity on whether operating hour restrictions should also apply to non-storefront retail, which do not allow for customer access.
2. Clarification on whether to limit the number of retail non-storefront locations.
This work session staff report includes additional analysis as noted above on the items Council requested additional analysis and/or clarification, in addition to input and direction from the Council on Items Nos. 7, 8, and 9, which were provided as part of the May 5th staff report but were not discussed during the public meeting.
Staff conducted the first review of input needs with Council at the May 5th Council meeting for question item Nos. #1 through 6 (a copy of the May 5th staff report is included as Attachment 1) and is returning to discuss tabled questions and question item Nos. #7 through #9 below given these alone require in depth conversation and analysis.
Items Council Directed Staff on Additional Analysis or Information:
1. Does the City want to include Microbusiness use types and what zones should be considered?
Recommendation: Given Council input on May 5th, staff would recommend allowing Microbusiness use types that do not include any “Cultivation” uses other than the Processor sub license type and limiting the potential retail use component to non-storefront.
Staff concludes, based on input received from Council during the zoning recommendations for the Processor Cultivation, Manufacturing, and Distribution uses, the requirement that a Microbusiness license consist of at least three of these activities at one location (including Retail) and given retail uses are not typically permitted in the Light Industrial or Industrial zones, non-storefront retail (delivery only, similar to a fulfillment center) should be the only type of retail use allowed for potential Microbusinesses.
2. What sensitive uses would the City like to identify, and what size buffers?
Buffer maps: Council requested various maps to reveal what potential buffers and sensitive receptor uses would provide in terms of available sites for consideration. Staff’s current assumption, based on prior input from Council, is that any such buffers are meant to be applicable to storefront retail or cannabis businesses that allow for customer access only. Attached to this report are maps that identify various buffer distances applied to each of the following sensitive receptors:
- Existing schools (K-12)
- Licensed day care facilities
- Parks, existing or planned (includes green space/trails)
- Youth centers
- Residential zoning
- Any existing church or religious institution, located either inside or outside of the city limits.
Based on the mapping exercise which identified buffer distances of 500, 600, 750, 900, and 1,000 feet from all of these sensitive receptors, there is clearly limited availability of sites in any of these buffer distance scenarios. For instance, under the 1000-foot buffer scenario, there are essentially no available sites with the exception of some Service Commercial in the East Main commercial corridor and near the Business Research Park (BRP). BRP zoning is limited for retail uses while Industrial zoning prohibits stand-alone retail uses. Even under the 500-foot buffer scenario, there are not many sites to consider.
Input from Cannabis Retailers: In addition to doing the mapping exercise, staff sought input from Cannabis Retailers. Staff spoke with several existing Cannabis Retailers in the region to acquire input on any recommendations or suggestions as to where they would consider locating retail businesses within the City. The input varied given familiarity with Visalia, but some main points expressed by these Retailers are included as “Attachment 2: Cannabis Retailer Input.”
Larger cities location considerations: There was a request by Council for additional research into what some of the larger urban markets beyond Visalia’s region put forth in terms of buffer and location considerations. Staff looked at specific buffer language and zoning considerations for the cities of Bakersfield, Fresno, Modesto, Los Angeles, San Diego, and San Francisco. Those findings are included in “Attachment 3: Large City Location Research.” It should be noted that there are 8 dispensaries operating in Modesto, 13 retailers open in Fresno (as of May 2024), over 200 dispensaries in the City of Los Angeles, 27 retail cannabis businesses (with max set at 36) in San Diego, over 60 dispensaries operating in San Francisco, and none operating in Bakersfield given commercial cannabis businesses are not allowed.
Buffer and Sensitive Uses Recommendation: Taking all of this into consideration and given the severely limited availability of sites when considering the buffering distances as provided in the attached maps from residential zoned land and parks/trails in Visalia, staff would not recommend including such buffers. Rather, staff would recommend a 500-foot buffer from existing schools (K-12), licensed day care facilities, or “youth centers”. Applying this buffer distance to these explicitly listed land uses, which focus on youth-oriented locations, allows adequately available sites along major commercial corridors that are potentially suitable geographical locations that may best suit the needs for interested cannabis retailers.
Zoning Recommendation: Given retailer input, large city research, prior Council input, mapping results and corresponding staff recommended buffers and sensitive uses, staff recommends considering allowing cannabis retail storefront uses as a conditionally allowed use in the Commercial Mixed Use (CMU) zone, Regional Commercial (CR) zone, and Service Commercial (CS) zone. These zones allow retail related uses, can be found in high traffic commercial corridors with ample parking, should have a variety of existing commercial spaces available, and are outside of other potential retail zones that Council may not wish to entertain for storefront cannabis retail uses such as the Neighborhood Commercial (C-N) and Downtown Mixed Use (DMU) zones.
‒ East Downtown: Given Council’s interest in prohibiting these uses in the Downtown Area, staff is seeking clarity on whether or not this should also include the East Downtown area as well. In not allowing the use in the DMU zone, this adequately restricts access to Downtown (i.e., sites zoned DMU). However, it does not restrict access to portions of the East Downtown which is generally defined as the area north of Mineral King Ave., east of Tipton St., south of Murray Ave., and west of Ben Maddox Way, given that area also consists of C-S and CMU zoning.
Recommendation: During the cannabis retailer survey process, staff learned of several retailers that considered themselves, “higher end” or “boutique” type businesses that prefer downtown districts. Allowing access to East Downtown may provide ample access to such a district while also aiding in the revitalization efforts of the East Downtown area, similar to the Microbrewery District efforts. Staff is seeking Council direction on whether to restrict cannabis uses in the East Downtown Area.
Buffers from other retail cannabis stores Recommendation: Due to complications that proximity buffers from other cannabis retailers may pose during the application and selection process, namely the need to identify a site in the application process, potentially combined with a lottery selection process, staff would not recommend requiring a buffer between selected retail cannabis businesses.
Non-storefront retail buffers Recommendation: Given non-storefront retail does not allow customer access, and given the City currently only allows Delivery only medical marijuana retail (non-storefront medical) in the Industrial and Light Industrial zones, it would likely make sense to only allow non-storefront retail businesses to operate outside of typical retail commercial corridors, and instead locate in zones such as the Light Industrial or Industrial zones. As such, such buffers would not seem necessary so staff would not recommend applying sensitive use buffers to non-storefront retail or non-storefront medical.
Items Yet to be Discussed in Detail:
7. a. Should the application and selection process be codified by Ordinance or adopted by Resolution?
HdL strongly recommends the business application and selection process be defined and approved separately by resolution. In the local region, HdL has assisted the Cities of Hanford, Farmersville, Porterville Fresno, and Firebaugh with developing their application and review processes. Additionally, HdL conducted the application review for these cities with the exception of Fresno.
Recommendation: Staff recommends the application and selection process be adopted by resolution rather than ordinance. Adoption by resolution would allow any future changes to these processes to be conducted in a streamlined manner rather than having to make changes subject to the adoption of ordinance requirements (i.e., first and second readings with a 30-day requirement before an ordinance takes effect).
7. b. Structure and Information Material of Business Application
The following is in regard to the retail storefront business type in particular. Application materials for other cannabis business types may be similar, though given a competitive selection process may not be applicable, staff would envision these applications to be much more streamlined and typical of existing application processes for other business types in the City.
Structure of Application: Given the vast amount of material that is required as part of the application process, staff, with guidance from HdL,, has identified an outline of the material and steps the Council may want to consider when businesses submit their application for consideration. The following is an outline and overview of the application process for Council’s consideration and direction:
1. All applications must respond to all requirements outlined in the procedures and guidelines to be prepared by staff. Submittals must be done as one complete comprehensive application package either via in person or by a certified delivery company (i.e., FED EX, UPS or any other common carrier delivery service). Items recommended to be included as part of the application include (All documents to be original wet signatures and notaries for each document where applicable):
a. Commercial Cannabis Business Application;
b. Financial Responsibility, Indemnity and Consent to Inspection Terms Agreement;
c. Agreement on Limitations of City’s Liability, and Certifications, Assurances, Warranties, and Indemnification to City;
d. Property Owner Consent/Landlord Affidavit;
e. Proof Property Ownership or Lease Agreement/Letter of Intent to Lease;
f. Proof of insurability from an Insurance Company;
g. Zoning Verification Application;
h. Application Zoning Verification Letter;
i. Application fee. Please note, staff will review the City’s current Fee Schedule to determine the appropriate fees to be applied to this application process.
Recommendation: Staff recommends that the Council direct staff to proceed with structuring a comprehensive application that includes items as detailed above.
Background / Criminal Check Requirement(s): As part of the overall Cannabis Ordinance process, background checks should be required for any person who is an owner, operator, manager and/or employee (collectively “Cannabis Business Person(s)”), and must undergo a criminal history background check to demonstrate they do not provide “good cause” for denial. Any potential operator, manager and/or employee (collectively “Cannabis Business Person(s)”) who do not meet the criminal history eligibility requirements will be disqualified.
Recommendation: Staff recommends background/criminal history checks be required as part of this process.
Zoning Verification Letter: When reviewing other jurisdictions application processes, staff noted that most cities required applicants to obtain a Zoning Verification Letter from the Planning Department. The Zoning Verification Letter is required to specify the intended use of the building (i.e. storefront retail) and the proposed building location. However, issuance of a Zoning Verification letter does not constitute written evidence of permission given by the City or any of its officials to operate a cannabis business, nor does it establish a “permit”, nor does it create an entitlement under the Zoning or Building Code.
Recommendation: Staff recommends that Zoning Verification letters be required as part of the application process and that an appropriate fee is assessed.
7.c Evaluation, Review and Proposed Selection Process
HdL has indicated that selection processes for any such Cannabis related business/use that may require limiting the number of licenses issued (e.g., retail storefront) should ultimately be done via a lottery draw method. This process is recommended in an effort to reduce exposure and risk to potential litigation by unselected applicants. The process should also include thorough application requirements and thorough quality assurance review for submitted applications, particularly if more applicants apply than licenses can be issued. Doing so establishes a rigorous up-front process to identify qualified firms for the lottery draw method.
Based on these concerns, the following outline evaluation, review and approval process structure is being provided for Council’s consideration and direction:
1. Determination of Eligibility - All applications must be completed and submitted in their entirety to move forward in the review process. Upon receiving a completed application, the application will be reviewed in its entirety based on the application checklist, which will be drafted by staff with assistance from HdL.
2. Application Evaluation and Review - Applications can be evaluated by using a set list of criteria, which is a common practice with other jurisdictions that have Cannabis ordinances. Examples of criteria to be used could include the following:
- Business Plan - Include various elements of typical business plans, including in this case items such as owner qualifications, past performance, budgets and pro forma, proof of capitalization, description of operations.
- Location and Neighborhood Compatibility Plan - Should include elements typical for the City’s site plan review submittals but also how the potential business will proactively address and respond to any neighborhood complaints or concerns (odor control plan, managing traffic, waste management plan, etc.) in order to address neighborhood compatibility.
- Safety and Security Plan - Should consider all possible fire, medical and hazardous situations, as well as all access control, inventory control, cash handling procedures. Complete policy/procedures manuals are not required at this point in the application process however, a great deal of review of the eventual requirements will need to be evident and detail will need to be provided at this stage.
- Community Benefits Plan - Details any benefits the potential business will provide to the local community. Benefits may be in the form of volunteer services, monetary donations to local non-profit organizations, financial support of City-sponsored activities or organizations, in-kind donations to the City or other charitable organizations and/or any other economic incentives to the City.
Those applications, which are determined to meet the requirements in each category, will move on to the next step of the application process. If the application is incomplete or does not otherwise meet the minimum requirements, the Applicant may be given an opportunity to resubmit those sections that have been deemed incomplete or deficient. However, limitations to the number of times applicants may amend their application should be established.
3. Lottery Selection - For the reasons as noted above, all applications that can be accepted due to complete application filings should be eligible to be entered into a random lottery drawing that would permit them into the final step of the selection process. Staff will work with HdL to establish how this process should be structured to provide transparency in this process.
4. Permittee Selection Process - Official issuance of a commercial cannabis business permit should be conditioned upon the prevailing applicant obtaining all required land use approvals and building permits. Staff recommends land use approvals include obtaining a Conditional Use Permit (CUP). Staff would recommend allotting applicants six (6) months from the lottery selection to obtain a CUP and twelve (12) months to obtain any necessary building permits. During the CUP hearing process, any potential concerns from nearby business locations or citizens could be heard and taken into consideration prior to issuance of cannabis business permit/license.
Recommendation: Direct staff to proceeds with establishing the Evaluation, Review and Proposed Selection Process as outlined above.
8. Who would approve the licenses (Planning Director, City Manager, City Council)?
HdL has indicated that communities in which the City Manager or designee, or other city staff approve licenses as opposed to the City Council are typically less exposed to litigation.
Recommendation: Assign the approval authority to the City Manager or their designee.
9. Who would hear appeals?
In the delivery only medical marijuana retail business ordinance, the City Manager or their designee is assigned to hear appeals after a written notice of appeal is filed with the City Clerk within 10 business days of receipt of business license denial. There is no appeal to the City Council.
Recommendation: Assign appeal hearing process to the City Manager or their designee.
Next Steps:
Staff will work with HdL to format and structure the draft cannabis ordinance and business application and selection process resolution with the appropriate content as directed by Council. Staff will then return to a future Council meeting to review these materials.
Staff will also seek input from several business group partnerships such as the Visalia Chamber, Downtown Visalians, the Tulare Kings Hispanic Chamber of Commerce and the Visalia EDC, as well as the Citizens Advisory Committee. Any input received will be presented to Council in future presentations.
Fiscal Impact: None at this time
Prior Council Action:
• May 5, 2025 - Council provided initial input on questions #1 - 6 outlined in this report.
• March 3, 2025 - Council authorized staff to proceed with drafting a cannabis business ordinance for adoption but during the adoption process, set the number of businesses permitted to operate in the City to zero effectively establishing the regulatory framework for such businesses but not yet permitting such businesses to operate.
Other: N/A
Alternatives: Per Council direction
Recommended Motion (and Alternative Motions if expected):
recommendation
No formal action required. All comments, feedback, and any unanswered questions received can be brought back to the City Council as a future Work Session (if needed) as staff and the consultant work on drafting the cannabis ordinance to be brought back to Planning Commission and the Council as appropriate.
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Environmental Assessment Status: N/A
CEQA Review: N/A
Attachments:
- Attachment 1: May 5th staff report
- Attachment 2: Cannabis Retailer Input
- Attachment 3: Large City Location Research
- Attachment 4: Staff presentation
- Map 1: 500’ w/Residential and Parks
- Map 2: 600’ w/Residential and Parks
- Map 3: 750’ w/Residential and Parks
- Map 4: 900’ w/Residential and Parks
- Map 5: 1000’ w/Residential and Parks
- Map 6: 500’ without R & P
- Map 7: 600’ without R & P
- Map 8: 750’ without R & P
- Map 9: 900’ without R & P
- Map 10: 1000’ without R & P