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A. Prior to engaging in any commercial cannabis activity, one must obtain a Commercial Cannabis Permit. The initial permit and annual renewal of an authorized and lawful Commercial Cannabis Permit is made expressly contingent upon the commercial cannabis business’ ongoing compliance with all requirements of State law, this chapter, the City of Chico City Code, any local regulations adopted by the City governing the commercial cannabis business at issue, the securing and approval of a Use Permit (when required pursuant to Title 19 of the Chico Municipal Code), and any required approval, permit or license required by any applicable local or State law, rules, or regulations.
B. No person may engage in, conduct, authorize, establish, or operate a commercial cannabis business, or cause, allow, or permit same, within the City of Chico unless and until the following are obtained, complied with, adhered to, and fulfilled:
1. A Commercial Cannabis Permit has been approved by the City, pursuant to the City’s laws, rules, policies, and regulations, as applicable, as same may be amended from time to time; and
2. Zoning clearance issued by the Community Development Director, including where applicable, issuance of a Conditional Use Permit; and
3. A City business license issued by the Finance Department authorizing the business operation of a commercial cannabis business; and
4. A valid State of California Seller’s Permit or other valid State of California license or permit for the applicable type of commercial cannabis business at issue has been obtained; and
5. Permittee is currently in compliance with all applicable state and local laws and regulations pertaining to engaging in, conducting or operating a commercial cannabis business and commercial cannabis activities, including the duty to first obtain any required State licenses pursuant to MAUCRSA and applicable regulations; and
6. Permittee is currently in compliance with any and all applicable state and local laws and regulations pertaining to the occupancy of the premises for the City-approved commercial cannabis business operation, including any and all applicable building and fire code provisions; and
7. Prior to operating in the City and as a condition of issuance of a regulatory permit, operator of each cannabis facility shall execute an indemnity agreement with the City of Chico and an acknowledgement of limitations on City’s liability, certifications, assurances, and warranties.
C. Applicant shall be responsible for all fees and noticing obligations required for processing all permits.
(Ord. 2552 §1, Ord. 2589 §2)
A. Pursuant to California Penal Code Sections 11105(b)(11) and 13300(b)(11), which authorize City authorities to access state and local criminal history information for cannabis employment, licensing, or certification purposes, summary criminal history information for cannabis employment, licensing, or certification purposes, and authorize access to federal level criminal history information by transmitting fingerprint images and related information to the Department of Justice to be transmitted to the Federal Bureau of Investigation, every applicant for a Certificate of Approval (including owners and other representatives of the applicant) and every person to be employed at the facility must submit fingerprints and other information deemed necessary by the Chief of Police or their designee(s) for a background check by the Chico Police Department. A fee for the cost of the background investigation, which shall be the actual cost to the City of Chico to conduct the background investigation as it deems necessary and appropriate, including City staff time and costs, shall be paid at the time the person submits for the background check.
B. The criminal background check must at a minimum identify the following:
1. Whether the individual applying for cannabis employment has ever been convicted of a violent felony as defined by California Penal Code 667.5, or equivalent offenses in other states;
2. Whether the individual applying for cannabis employment has ever been convicted of a crime involving dishonesty, fraud or deceit, including but not limited to fraud, forgery, theft, or embezzlement as those offenses are defined in California Penal Code Sections 186.11, 470, 484, and 504a, respectively; or equivalent offenses in other states; or
3. Whether the individual applying for cannabis employment has ever been convicted of the illegal use, possession, transportation, distribution or similar activities related to controlled substances, as defined in the Federal Controlled Substances Act, not including cannabis-related offenses for which the conviction occurred after the passage of the Compassionate Use Act of 1996.
C. The Chief of Police may, at his/her discretion, require applicants to utilize a third-party provider for purposes of conducting the criminal background check. The third-party background check may serve in place of, or in addition to, the criminal background check performed by the Chico Police Department, as described in Section 5.42.105A.
D. Evidence of a conviction of any the offenses enumerated in Section 5.42.105B. shall be grounds for denial of employment.
E. Violation of this section shall be grounds for immediate suspension of the business’ operating permit. The business operator shall have the right to an appeal pursuant to Section 5.42.160.
(Ord. 2552 §1, Ord. 2589 §2)
A. This section is intended to establish a method for the determination of the maximum number of commercial cannabis businesses that may be issued Commercial Cannabis Permits to operate in the City under each category of commercial cannabis business type. The City Council may establish further policies and procedures by minute order, ordinance or resolution regarding processes and procedures for processing and selecting of permits.
B. Nothing in this chapter creates a mandate, right, obligation, or expectation that the City must, will or shall authorize any or all of the permits available at any time, increase the number of permits available, or issue a permit to a commercial cannabis business that submits an application to the City if it is determined that it is in the best interest of the City to not authorize such in the City, or if an applicant does not meet the standards established in the application requirements or further amendments to the application process. There is no guarantee that the City will authorize any commercial cannabis business to operate in the City.
C. The number of retailer-storefront permits shall be determined by population density of the City of Chico. For every 25,000 residents of the City, based on the most recent Population Estimates for Cities, Counties, and the State, conducted by the California Department of Finance, the City Council may authorize up to one retailer-storefront permit. The City Council shall from time to time, at its sole and absolute discretion, establish by resolution the number of retailer-storefront permits authorized for commercial cannabis businesses based on this formula.
D. No more than the number of cannabis retailers initially authorized herein to operate or as amended by resolution may operate within the City of Chico at any one time and shall be issued a permit by the City of Chico. At the time of the passage of this chapter, the maximum number of commercial cannabis businesses per classification citywide are as follows:
Retailer-Storefront - Four (4)
Retailer-Non-Storefront - No maximum
Testing laboratory - No maximum
Manufacturing - No maximum
Distribution - No maximum
E. Each year following the initial award of permits, if any, or at any time in the City Council’s discretion, the City Council may reassess the number of Commercial Cannabis Permits which are authorized for issuance. The City Council, in its discretion, may determine by resolution that the number of Commercial Cannabis Permits should remain the same, be reduced, or be increased.
F. A person may only have an ownership interest in one (1) retailer-storefront business in the City of Chico. Any person with community property rights of an ownership interest is considered a person with ownership interest in this section.
(Ord. 2552 §1, Ord. 2589 §2)
A. All commercial cannabis businesses shall be located in an approved land use designation area as identified under Title 19.75.
B. No retailer-storefront commercial cannabis business shall be located within 1000' feet of another retailer-storefront commercial cannabis business. In the event that two or more applications for commercial cannabis retailer-storefront uses are submitted and are under consideration simultaneously for locations within 1000' of each other, all applications may continue to be considered until final award of Commercial Cannabis Permit and use permit. However, final award of use permit by Planning Commission may not allow retailer-storefront uses to be located within 1000' of each other.
(Ord. 2552 §1, Ord. 2589 §2)
Each Commercial Cannabis Permit issued pursuant to this chapter shall expire one (1) year after the date of its issuance. The City Council shall establish by resolution procedures for the renewal, revocation, and suspension of Commercial Cannabis Permits.
(Ord. 2552 §1, Ord. 2589 §2)
A. Expiration, suspension or revocation of a license, permit or entitlement issued by the State of California related to a commercial cannabis business shall be grounds for immediate suspension of a commercial cannabis business to operate within the City, unless and until such license, permit or entitlement is reinstated or reissued.
1. Permittee shall notify the City Manager in writing within forty-eight (48) hours of any suspension, revocation, or termination of a license issued by the State of California, or by any of its departments or divisions.
2. Should the State of California, or any of its departments, divisions, or agencies, suspend, revoke or terminate the license of a commercial cannabis business operating in the City, such suspension, revocation or termination, the City Manager shall suspend the ability of a commercial cannabis business to operate within the City of Chico unless and until the State of California, or its respective department, division, or agency reinstates or reissues the State license. Notice of such suspension shall be provided to the commercial cannabis business.
B. Expiration, suspension or revocation of a license, permit or entitlement issued by the City of Chico related to a commercial cannabis business shall be grounds for immediate suspension of a commercial cannabis business to operate within the City, unless and until such license, permit or entitlement is reinstated or reissued. Notice of such suspension shall be provided to the commercial cannabis business.
C. The commercial cannabis business shall have the right to an appeal pursuant to Section 5.42.160.
(Ord. 2552 §1, Ord. 2589 §2)
A. The following are grounds for revocation of a Commercial Cannabis Permit:
1. Failure of a permittee to comply with any requirement imposed by the provisions of this Code (or successor provision or provisions), including, but not limited to, any rule, regulation, condition or standard adopted pursuant to this chapter, or any term or condition imposed on the Commercial Cannabis Permit or entitlements or Use Permit, or any provision of State law.
2. Revocation of a State license issued under this chapter.
3. If the permittee, its owner(s), manager(s) or a responsible person has, within the past three (3) years, been sentenced or had a judgment issued in a criminal or civil court proceeding, and/or has been sanctioned or fined for, enjoined from, or found guilty of or plead guilty or no contest to a charge for engaging in a commercial cannabis activity in the State without the necessary permits and approvals from the applicable State and/or local jurisdictions; or has had a commercial cannabis license revoked or suspended by the applicable State and/or local jurisdictions.
4. Conviction within the past ten (10) years of the permittee, its owner(s) or manager(s), or a responsible person, including a plea of guilty or no contest, to any of the following offenses shall be grounds for revocation of a Commercial Cannabis Permit issued by the City:
i. A violent felony, as specified in Section 667.5(c) of the Penal Code.
ii. A serious felony, as specified in Section 1192.7(c) of the Penal Code.
iii. A felony involving fraud, deceit, or embezzlement.
iv. A felony for hiring, employing, or using a minor in transporting, carrying, selling, giving away, preparing for sale, or peddling, any controlled substance to a minor; or selling, offering to sell, furnishing, offering to furnish, administering, or giving any controlled substance to a minor.
v. A felony for drug trafficking with enhancements pursuant to Section 11370.4 or 11379.8 of the Health and Safety Code.
vi. A felony or misdemeanor involving the illegal possession for sale, sale, manufacture, transportation, or cultivation of a controlled substance occurring after January 1, 2016.
5. If the permittee fails to satisfy all of the requirements set forth in Section 5.42.100B. within three years of the issuance of a Commercial Cannabis Permit or January 1, 2027, whichever occurs later.
B. If the City Manager determines that a ground for revocation of a Commercial Cannabis Permit exists, the City Manager shall serve written notice of revocation to the permittee or responsible person. The notice may be served on the recipient either personally or by certified first class mail to the address listed on the application. This notice shall state the reasons for the action, the effective date of the decision, the right of the permittee to appeal the decision to the City Council, or its appointed hearing officer or body, and that the City Manager’s decision will be final if no written appeal is timely submitted to, and received by, the City, pursuant to the provisions of this chapter.
C. This notice will be effective within ten (10) days from the date of service of the notice. To exercise the right to appeal, the permittee must file with the City Clerk a written basis for the appeal, including evidence relating to the grounds for revocation, and the applicable fee. The appeal will be heard by the City Council or its appointed hearing officer or body in accordance with Section 5.42.160. If no timely appeal is filed, the City Manager’s decision will be final 10 days after the date on the notice of revocation. If an appeal is timely and properly filed in accordance with this chapter, then the effective date of the notice is stayed until a decision after the hearing on the appeal is issued.
(Ord. 2552 §1, Ord. 2589 §2, Ord. 2598 § 1)
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