Cannabis Application Deadline Looms

Culver City officials are bracing for what could be an avalanche of applications from entrepreneurs hoping to obtain one of the three permits to legally sell marijuana from retail storefronts within the City boundaries as the Sept. 27 deadline to submit all the paperwork approaches.

The trio of permits will be the first that Culver has ever offered. Applications for the permits, which would enable the holder to legally operate a retail storefront cannabis business, must be received by 5 p.m. Thursday.

The applications are being accepted through the City's online portal, https://aca.culvercity.org/citizenaccess/.

California voters approved Prop. 64, the Adult Use of Marijuana Act, in November 2016. After its passage, the Culver City Council had to decide to continue the ban on cannabis businesses or to allow them.

A cannabis task force was formed to develop regulations, and the City Council ultimately decided to lift the ban. Then, in April 2018, Culver City voters approved a special cannabis tax that would be levied on all cannabis-related businesses.

"There are several reasons why the City Council decided to legalize cannabis businesses," said Jesse Mays, assistant to the City Manager.

"One being, they were responding to the will of Culver City residents. Second, it will provide a safe and regulated alternative, and reduce the opportunity for diversion of drugs to the youth.

"And third, Culver City voters approved a cannabis tax to raise revenue for the city. That money will go towards funding youth programs, community programs, parks" and the like," Mays said.

Mays expects that there may be as many as 20 applicants for the three permits.

The location of the storefronts will be subject to a variety of rules, including:

• The business must be at least 600 feet from K-12 schools, day care centers (including pre-schools), youth centers, parks and playgrounds.

• It must also be at least 1,000 feet from another retail storefront cannabis business.

• It cannot be located on a corner lot next to residential areas.

There is, however, an exception for entrepreneurs who want to open their shop on a residential corner lot. The storefront may be permitted if the building's exterior is at least 45 feet from the property line of the closest residentially zoned property.

The City has created a competitive, merit-based application process that consists of multiple phases.

"It takes a significant amount of effort, time, and expense to even apply," Mays said.

The application process is detailed and rigorous, Mays added, and the owners/managers must go through a Department of Justice background check. The process also involves the review of a safety plan, security plan, business plan, location compatibility plan, odor management plan, waste plan and an insurance plan.

Once the background checks have been conducted, a panel of three City staff members appointed by the City Manager will review the applications. They will then select a minimum of three and a maximum of six applicants to proceed to the next step; other applications may be put on hold.

The next step consists of a panel of five City staff members, also appointed by the City Manager. They will interview each remaining applicant and will contact officials in the jurisdiction where the applicants have previously or currently operate another business, Mays said.

If possible, a City staff member will visit the site of a business currently operated by an applicant. The applicants will be scored and the three with the highest score will move on to the next round of the process.

In the third round, the applicants will apply for a Conditional Use permit and the appropriate Los Angeles County permits. Then, the applicants are responsible for hosting a public meeting and informing all occupants and property owners within 2,500 feet of the proposed site.

The public must be informed at least 10 days before the meeting will be held. At least two of the largest individual equity holders of the business applicant, as well as the highest-level manager responsible for day-to-day operations at the proposed location, must be present at the public meeting.

If an applicant is approved after the public meeting they will then present their proposal in a public City Council meeting. The City Council will vote to approve a permit and the permit will only be awarded if the rest of the approval process is successfully completed.

The rest of the approval process requires applicants to apply for a Culver City Business Tax Certificate and all regularly required City permits. If the permits are given, the applicants can move forward to pay fees for regularly required building permits.

They will initiate and complete buildout, including any regularly required City and Los Angeles County inspections. Then, a final inspection will be conducted by the county's health department and the City will ensure that the business is operating under the requirements of the Culver City Municipal Code.

If an applicant passes all the inspections, they will then pay the "annual cannabis business permit" fee. City officials will then issue the permit and a business-tax certificate.

Earlier in the year, applications were accepted for non-storefront businesses, such as home delivery, manufacturing and wholesale distributing. Fifteen applications received preliminary approval and they are in the process of filing for the required permits.

All approved applicants will have to wait to operate in Culver City until their state cannabis license is approved and received.

Then, they'll be open for business.