(A) Records and recordkeeping.
(1) Should the city impose any tax upon commercial cannabis businesses, each owner and operator of a commercial cannabis business shall maintain accurate books and records, detailing all the revenues and expenses of the business, and all its assets and liabilities. On no less than an annual basis (at or before the time of the renewal of a cannabis business permit issued pursuant to this chapter), or at any time upon reasonable request of the city, each cannabis business shall file a sworn statement detailing the number of sales by the cannabis business during the previous 12 month period (or shorter period based upon the timing of the request), provided on a per-month basis. The statement shall also include gross sales for each month, and all applicable taxes paid or due to be paid. Each owner and operator shall keep and preserve for a period of no less than seven years all records as may be necessary to determine the amount of such tax the operator may have been liable to collect and remit to the city.
(2) Each owner and operator of a commercial cannabis business shall maintain a current register of the names and the contact information (including the name, address, telephone number, a copy of that person’s government issued identification, and email address) of anyone owning or holding an interest in the cannabis business, and separately of all the officers, managers, employees, agents and volunteers currently employed or otherwise engaged by the commercial cannabis business. The register required by this article shall be provided to the City Manager upon a reasonable request.
(3) All cannabis businesses shall maintain an inventory control and reporting system that accurately documents the present location, amounts, and descriptions of all cannabis and cannabis products for all stages of the production or manufacturing, laboratory testing and distribution processes.
(4) Subject to any restrictions under the Health Insurance Portability and Accountability Act (HIPAA), each cannabis business shall allow city officials to have access to the business’s books, records, and accounts, together with any other data or documents relevant to its permitted cannabis activities, for the purpose of conducting an audit or examination. Books, records, accounts, and all relevant data or documents will be produced no later than 24 hours after receipt of the city’s request, unless otherwise stipulated by the city.
(B) Security measures.
(1) All cannabis businesses shall at all times implement the security measures required by state law, including, but not limited to those set forth in California Code of Regulations Title 19, Division 4, Chapter 1, Article 5.
(2) Permittee shall provide copies of any surveillance videos to the city with one day of request therefor by the Police Chief.
(3) Any bars to be installed on the windows or the doors of the cannabis business for security purposes, if permitted by the city, shall be installed only on the interior of the building;
(4) Security personnel, if utilized, must be licensed by the State of California Bureau of Security and Investigative Services personnel, shall comply with the requirements of California Business and Professions Code Chapters 11.4 and 11.5 of Division 3, and have a valid business license from the city;
(5) Each cannabis business shall have the capability to remain secure and operational during a power outage and shall ensure that all access doors are not solely controlled by an electronic access panel to ensure that locks are not released during a power outage;
(6) Each cannabis business shall identify a designated security representative/liaison to the city, who shall be reasonably available to meet with the City Manager regarding any security related measures or and operational issues; and
(7) A cannabis business shall notify the City Manager within 24 hours after discovering any of the following:
(a) Significant discrepancies identified during inventory, as set forth in the city’s administrative regulations;
(b) Diversion, theft, loss, or any criminal activity involving the cannabis business or any agent or employee of the cannabis business; or
(c) The loss or unauthorized alteration of records related to cannabis, registering qualifying patients, primary caregivers, or employees or agents of the cannabis business and/or cannabis sales.
(C) Restriction on alcohol sales. No person shall cause or permit the sale, dispensing, or consumption of alcoholic beverages on or about the premises of the cannabis business.
(D) Compliance with laws. It is the responsibility of the owners and operators of the cannabis business to ensure that it is, at all times, operating in a manner compliant with all applicable state and local laws, and any regulations promulgated thereunder. Nothing in this chapter shall be construed as authorizing any actions which violate state law or local law with respect to the operation of a cannabis business or any site-specific, additional operating procedures or requirements which may be imposed as conditions of approval of the location of the cannabis business.
(E) Taxes. All cannabis businesses authorized to operate under this chapter shall pay all sales, use, business and other applicable taxes, and all license, registration, and other fees required under federal, state and local law. Each cannabis business shall cooperate with the city with respect to any reasonable request to audit the cannabis business’s books and records for the purpose of verifying compliance with this section, including, but not limited to, a verification of the amount of taxes required to be paid during any period.
(F) Insurance. Permittee shall obtain and maintain at all times during the term of the permit comprehensive general liability insurance and comprehensive automotive liability insurance protecting the permittee in an amount of not less than $1,000,000 per occurrence, combined single limit, including bodily injury and property damage and not less than $1,000,000 aggregate for each personal injury liability, products-completed operations and each accident, issued by an insurance provider rated at least A-:VIII in A.M. Best and Company’s Insurance Guide and either admitted and authorized to do business in California or listed on the California Department of Insurance’s list of approved surplus line insurers; and enter into an agreement approved by the City Attorney to defend, with attorneys of the city’s choosing, indemnify, release and hold harmless the city, its City Council, boards, commissions, officers and employees from and against any and all claims, demands, obligations, damages, actions, causes of action, suits, losses, judgments, fines, penalties, liabilities, costs and expenses (including, without limitation, attorneys’ fees, disbursements and court costs) of every kind and nature whatsoever which may arise from or in any manner relate (directly or indirectly) to the permittee or the permittee’s activities. This indemnification shall include, but not be limited to, damages awarded against the city, if any, costs of suit, attorneys’ fees, and other expenses incurred in connection with such claim, action, or proceeding whether incurred by the permittee, city, and/or the parties initiating or bringing such proceeding, and shall not be limited by the types and/or amounts of insurance required herein.
(G) Miscellaneous operating requirements.
(1) Restriction on consumption. Cannabis shall not be consumed on the premises of any cannabis businesses.
(2) No cannabis or cannabis products or graphics depicting cannabis or cannabis products shall be visible from the exterior of any property issued a cannabis business permit, or on any of the vehicles owned or used as part of the cannabis business. No outdoor storage of cannabis or cannabis products is permitted at any time.
(3) Reporting and tracking of product and of gross sales. Each cannabis business shall have in place a point-of-sale tracking system to track and report on all aspects of the cannabis business including, but not limited to, such matters as cannabis tracking, inventory data, and gross sales (by weight and by sale). The cannabis business shall ensure that such information is compatible with the city’s record-keeping systems. The system must have the capability to produce historical transactional data for review by the City Manager.
(4) All cannabis and cannabis products sold, distributed or manufactured shall be cultivated, manufactured, and transported by licensed facilities that maintain operations in full conformance with all state and local laws.
(5) There shall not be a physician located in or around any cannabis business at any time for the purpose of evaluating patients for the issuance of a cannabis recommendation or card.
(6) Signage and notices.
(a) In addition to the requirements otherwise set forth in this section, business identification signage for a cannabis business shall conform to the requirements of this code.
(b) Each entrance to a cannabis business shall be visibly posted with a clear and legible notice indicating that smoking, ingesting, or otherwise consuming cannabis on the premises or in the areas adjacent to the cannabis business is prohibited.
(c) Business identification signage shall be limited to that needed for identification only.
(d) The business shall at all times comply with the advertising and marketing restrictions of California Business and Professions Code §§ 26150–26156, in addition to the requirements of this code.
(7) Minors.
(a) Persons under the age of 21 years of age shall not be allowed on the premises of a cannabis business, except as otherwise specifically provided for by state law. It is unlawful and a violation of this chapter for any person to employ any person at or for a cannabis business who is not at least 21 years of age.
(b) The entrance to the cannabis business shall be clearly and legibly posted with a notice that no person under the age of 21 years of age is permitted to enter upon the premises of the cannabis business except as specifically provided for herein.
(8) Odor control. All commercial cannabis businesses shall be required to provide an air treatment system that ensures off-site odors shall not result from its operations. This requirement at a minimum means that the facility shall be designed to provide sufficient odor absorbing ventilation and exhaust systems so that any odor generated inside the location is not detected on adjacent properties or public rights-of-way, or within any other unit located within the same building as the facility, if the business occupies only a portion of a building.
(9) Display of permit and city business license. The original copy of the cannabis business permit issued by the city pursuant to this chapter and the city-issued business license shall be posted inside the cannabis business in a conspicuous location.
(10) Background check. Every owner, manager, supervisor or employee of the cannabis business must submit fingerprints and other information deemed necessary by the Director for a background check by the Police Department to verify that person’s criminal history pursuant to the requirements of this chapter.
(11) Loitering. The owner and/or operator of a cannabis business shall prohibit loitering by persons outside the facility both on the premises and within 50 feet of the premises.
(12) Permits and other approvals. Prior to the establishment of any cannabis business or the operation of any such business, the person intending to establish a cannabis business must first obtain all applicable planning, zoning, building, and other applicable permits from the relevant governmental agency, which may be applicable to the zoning district in which such cannabis business intends to operate.
(13) Free samples. No cannabis business shall provide or cause to be provided any free sample of cannabis goods to any person within the city.
(14) A licensed retailer may only sell cannabis goods, cannabis accessories, and licensees’ branded merchandise or promotional materials.
(H) Additional operating requirements for retail sale (storefront) businesses. In addition to every other requirement of this section, other than those set forth in division (I) (retail sale, non-storefront) that are expressly inapplicable, every business that sells cannabis as a storefront retailer shall comply with the following requirements:
(1) The security plan shall include at least one licensed private security guard or guards who shall be present at the premises during business hours and for both one hour prior to opening and one hour after closing, exterior lighting, and continuous video monitoring and recording of the interior and exterior of the premises. Video surveillance recordings must also include video of all entryways and exits of the premises. All video recordings shall be maintained for a minimum of 90 days.
(2) Both the private security guard and the business personnel shall monitor the premises and the immediate vicinity of the premises to ensure that patrons immediately leave the premises and do not consume cannabis in the vicinity of the retail business or on the property or in the parking lot, and shall ensure that persons do not loiter, linger, or otherwise congregate within 50 feet of the entrance to the premises.
(3) There shall be no on-site sales of alcohol or tobacco products, (excluding rolling papers and lighters) and no on-site consumption of food, alcohol, cannabis or tobacco by patrons.
(4) Hours of operation shall be limited to: 7:00 a.m. to 10:00 p.m. daily. No licensed retail business shall be open to the public between the hours of 10:01 p.m. and 6:59 a.m. of any day.
(5) The cannabis retail business shall notify patrons of the following through posting of a sign or signs in a conspicuous location:
(a) Unlawful sale, barter or distribution of cannabis is a crime and subject to a fine or arrest;
(b) Loitering on and around the retail premises is prohibited by California Penal Code § 647 and that patrons must immediately leave the premises and not consume cannabis in the vicinity and/or on the property or in the parking lot;
(c) A warning that patrons and/or employees may be subject to prosecution under federal cannabis laws, if applicable; and
(d) That the use of cannabis may impair a person’s ability to drive a motor vehicle or operate machinery and that doing so is illegal.
(6) No one under the age of 21 shall be allowed to enter the premises of a cannabis business unless the business holds a retail medical cannabis license (M-license) issued by the state.
(7) No person shall be permitted to enter the premises without government-issued identification, and cannabis goods may not be provided to any person, whether by purchase, trade, gift, or otherwise, who does not possess a valid government-issued identification and who does not meet the age requirements of this chapter.
(8) Electronic age verification device required. Proof of age of every person other than employees entering the business shall be verified with an electronic age verification device, prior to entry of the retail area or delivery to that person. The electronic age verification device may be mobile or fixed and shall be able to retain a log of all scans that includes the following information: date, time, and age. Said log shall be kept for a minimum of 180 business days and all records shall be made available to the City Manager upon request.
(9) Point-of-sale tracking required. The business shall facilitate the sale, making available, furnishing and/or delivery of cannabis goods with a technology platform that uses point-of-sale technology to track, and database technology to record and store, the following information for each transaction involving the exchange of cannabis goods between the business and consumer:
(a) The date and time of transaction;
(b) The first name and employee number of the employee who processed the sale of cannabis goods on behalf of the business.
(c) A list of all the cannabis goods purchased, including the quantity purchased; and
(d) The total amount paid for the sale, including the individual prices paid for cannabis or cannabis products purchased, and any amounts paid for taxes.
(10) Cannabis retail businesses shall also record on the video surveillance system point-of-sale areas and areas where cannabis goods are displayed for sale.
(11) Adequate signage shall clearly state who has inspected any cannabis product for pesticides, or other regulated contaminants, distributed at this location.
(12) Shipments of cannabis goods may only be accepted during regular business hours.
(13) Inventory shall be secured using a lockable storage system during nonbusiness hours.
(14) No cannabis product shall be visible from the exterior of the business.
(15) All required labelling shall be maintained on all product, as required by state law, at all times.
(16) A permitted commercial cannabis retail business shall have 180 days after permit issuance by the city to commence operations, after which the permit shall be void and of no further force and effect. A permitted commercial cannabis retail business that ceases to operate for more than 90 calendar days after commencing operations shall be deemed "abandoned” and the permit shall be forfeited. A permitted commercial cannabis business may temporarily suspend operations for a period of time as may be reasonably required to affect upgrades, modifications, repairs, or other property issue mitigations as approved by the Director or City Manager. For the purposes of this division, “operate" shall mean by the end of the 180 day period.
(17) Obtain and maintain at all times during the term of the permit the insurance required pursuant to division (F) above in the minimum amount of $2,000,000, and enter into an agreement approved by the City Attorney to defend, with attorneys of the city’s choosing, indemnify, release and hold harmless the city, its City Council, boards, commissions, officers and employees from and against any and all claims, demands, obligations, damages, actions, causes of action, suits, losses, judgments, fines, penalties, liabilities, costs and expenses (including, without limitation, attorneys’ fees, disbursements and court costs) of every kind and nature whatsoever which may arise from or in any manner relate (directly or indirectly) to the permittee or the permittee’s activities. This indemnification shall include, but not be limited to, damages awarded against the city, if any, costs of suit, attorneys’ fees, and other expenses incurred in connection with such claim, action, or proceeding whether incurred by the permittee, city, and/or the parties initiating or bringing such proceeding, and shall not be limited by the types and/or amounts of insurance required herein;
(I) Additional operating requirements for retail sale (non-storefront) delivery businesses. In addition to every other requirement of this section, except only for divisions (H)(1) through (5) and (10) (retail sale, store-front), every business that sells and/or delivers cannabis as a non-store front retailer shall comply with the following requirements:
(1) Commercial cannabis retail deliveries may be made only from a commercial cannabis retail business permitted by the city in compliance with this chapter, and in compliance with all state regulations.
(2) All employees who deliver cannabis shall have valid identification and a copy of the retail business’ cannabis business permit and state license at all times while making deliveries.
(3) All commercial cannabis retail businesses shall maintain proof of vehicle insurance for all vehicles being used to transport cannabis goods as required by state law.
(4) Deliveries may only take place during normal business hours of the commercial cannabis retail business.
(5) During delivery, the delivery employee shall maintain a physical or electronic copy of the delivery request and shall make it available upon request by the licensing authority and law enforcement officers. The delivery request documentation shall comply with state law.
(6) A licensed delivery employee shall not leave the State of California while possessing cannabis products and while performing his or her duties for the cannabis retailer.
(7) A commercial cannabis retail business shall maintain a list of all deliveries, including the address delivered to, the amount and type of product delivered, and any other information required by the state.
(8) A manifest with all information required in this section shall accompany any delivery person at all times during the delivery process and delivery hours.
(9) Any delivery method shall be made in compliance with state law, as amended, including use of a vehicle that has a dedicated GPS device for identifying the location of the vehicle (cell phones and tablets are not sufficient).
(10) Each delivery request shall have a receipt prepared by the commercial cannabis retail business with the following information:
(a) Name and address of the commercial cannabis retail business;
(b) The name of the employee who delivered the order;
(c) The date and time the delivery request was made;
(d) The complete delivery addresses;
(e) A detailed description of the cannabis goods requested for delivery, including the weight or volume, or any accurate measure of the amount of cannabis goods requested;
(f) The total amount paid for the delivery including any fees or taxes;
(g) At the time of the delivery, the date and time delivery was made, and the signature of the person who received the delivery;
(h) No cannabis delivery vehicle shall display signs, decals or any other form of advertisement; and
(i) Inspections by an authorized city representative may be conducted anytime during regular business hours.
(11) Delivery must be made to a physical address that is not on publicly owned land, a school, a day care, or a youth center.
(12) The delivery employee shall not carry cannabis goods valued in excess of $5,000 at any time with no more than $3,000 of cannabis goods that are not already part of a customer order that was processed prior to leaving the premises.
(J) Additional operating requirements for commercial cultivation. In addition to every other requirement of this section, except only for divisions (H) (retail sale, storefront) and (I) (retail sale, non-storefront), every business that cultivates cannabis shall comply with the following requirements:
(1) Cultivation shall always be conducted in accordance with state and local laws and regulations related to cultivation, zoning, grading, electricity, water usage, water quality, fish and wildlife habitat protection, wastewater discharges, pesticides, and fertilizers, handling and storage of gases, and employee safety.
(2) Cultivation shall always be conducted in such a way as to ensure the health, safety, and welfare of the public, the employees working at the cultivation site, and neighboring properties; to protect the environment from harm to waterways, fish, and wildlife; to ensure the security of the cannabis; and to safeguard against the diversion of cannabis for unlicensed purposes.
(3) Outdoor cultivation prohibited. All cultivation shall occur indoors, and only on a site holding a valid CCBP from the city pursuant to this chapter. Mixed light cultivation is allowed, including but not limited to, the use of greenhouses.
(4) Maximum canopy size.
(a) The total canopy size on one premises shall not exceed the maximum number of square feet authorized by state license classifications Type 1A, Type 1C, Type 2A, Type 3A, and Type 4B.
(b) The total canopy size on one premises shall not exceed the maximum number of square feet identified in the application and authorized by the CCBP.
(c) Permittees shall obtain written permission from the Director prior to engaging in any activity that results in an increase of the square feet of maximum canopy authorized by the CCBP.
(5) Extension cords prohibited. The use of extension cords to supply power to any electrical equipment used in cultivation is prohibited. All electrical equipment used in cultivation shall be plugged directly into a wall outlet or otherwise hardwired.
(6) Interior lighting. All lighting used for indoor cultivation shall be fully shielded, downward casting, and shall not spill over onto structures, other properties, or into the night sky. Indoor cultivation lighting shall be contained so that little to no light escapes and any light that escapes from the cultivation site shall be at a level that is not visible from neighboring properties between sunset and sunrise.
(7) Environmental control systems.
(a) In addition to the general odor control and ventilation requirements of this chapter, every cultivator shall implement environmental control systems to minimize and/or prevent the likelihood of mold and mildew growth. Cultivators shall regularly test for mold and mildew within the cultivation site.
(b) Environmental control systems at a cultivation site shall include a range of environmental control technologies and practices to control humidity levels, illumination, heating, cooling, air circulation, and ventilation.
(c) Compatibility with odor prevention and ventilation systems. Cultivators shall implement an environmental control system that is adequately compatible with any odor control prevention and ventilation systems at the cultivation site. For purposes of this article, ADEQUATELY COMPATIBLE means that any environmental control systems and odor control systems operating at the cultivation site operate concurrently to prevent cannabis odors from being detected outside the cultivation site, while still allowing for the permittee to successfully cultivate.
(8) Water source. Cultivators shall comply with California Water Code § 13149 and any implementing regulations, policies, or guidelines adopted by the state Water Resources Control Board regarding water usage, the diversion of water, and the discharge of waste while cultivating cannabis.
(9) Carbon dioxide testing. Cultivators shall test carbon dioxide levels within cultivation areas at the cultivation site, if carbon dioxide is added to the air. No carbon dioxide shall be utilized for cultivation without prior inspection and approval of the city’s Building Official and the Fire Chief.
(10) Storage and use of compressed gas.
(a) Storage and use of compressed gases in compressed gas containers, cylinders, tanks, and systems used for cultivation shall comply with this code and the California Fire Code.
(b) Any compressed gases used in cultivation shall not be stored on any property within the city in containers that exceed the amount that is approved by the Fire Chief and authorized by the CCBP.
(11) Pesticides.
(a) Cultivators shall comply with all applicable federal, state and local laws and regulations regarding use, storage, and disposal of pesticides and fertilizers, including, without limitation, those enforced by the state Department of Food and Agriculture and state Department of Pesticide Regulation. Cultivators shall ensure hazards are not created on the permitted premises by the use or storage of chemicals, fertilizers, materials, processes, products, or wastes.
(b) Pesticides, insecticides, and/or fertilizers prohibited by federal, state, or local law for fertilization or production of edible produce shall not be used for cultivation.
(c) Employee safety. At a minimum, cultivators using pesticides shall protect all employees from exposure to pesticides by following pesticide labels; providing required personal protective equipment; providing access to pesticide labels, safety information, and training on an annual basis; properly ventilating all areas of the cultivation site; and proper storage, handling, and disposal of pesticides in compliance with state, federal, and local laws and regulations pertaining to pesticide use and worker safety.
(12) Packaging and labeling.
(a) All cannabis packaged and/or labeled by a cultivator shall meet the provisions of packaging and labeling requirements specified by state law, including but not limited to, California Business and Professions Code Division 5 (“Weights and Measures”) and Division 10 (“Cannabis") and any regulations implemented and enforced by the DCC.
(b) Prior to distribution and transportation, a cultivator shall package and seal all cannabis in tamper-evident packaging and use a unique identifier of the harvest batch to identify and track said cannabis.
(c) Product labels. All labels for cannabis shall include all of the following: all required government warnings; the net weight of cannabis in the package; source and the date of cultivation; the type of cannabis; the date of packaging; and the product's unique identifier for the harvest batch.
(d) Packaging that makes cannabis attractive to children or imitates candy is prohibited.
(13) Accurate weights and measures.
(a) Weighing devices used by a cultivator shall be approved, tested, sealed, and registered with the Tehama County Agricultural Commissioner/weights and measures in compliance with California Business and Professions Code Division 5 (“Weights and Measures”) and Division 10 ("Cannabis”), any regulations implemented by the DCC, and all other applicable state and local laws.
(b) Cultivators are prohibited from using scales, weights, or measures that do not accurately conform to the standard of weights and measures of the state and county
(Ord. 1063, passed 2-15-2022)