Marijuana Business Magazine May-June 2020

Marijuana Business Magazine | May-June 2020 76 “I imagine the combination of these separation requirements and zoning requirements can be challenging for (cannabis) owners to navigate,” said Eric Escudero, spokesman with the Denver Department of Excise and Licenses. Moreover, zoning and related regulations vary widely in different communities across the country, noted Green of CannaMLS. Her company has helped entrepreneurs navigate a variety of local zoning issues, often using geographic information system (GIS) maps that can pinpoint where marijuana businesses are allowed. CannaMLS also has turned to demographic information such as an area’s median income and traffic counts to guide clients. Some of the zoning-related issues the company has encountered include: • In Santa Ana, California, all cannabis stores must be in industrial-zoned areas. • In Los Angeles, marijuana stores are permitted in some mixed-use zones, but manufacturing and cultivation facilities are restricted to industrial zones. California localities have not exactly rolled out the welcome mat for the marijuana industry. Roughly two-thirds of all California cities and counties prohibit legal marijuana commerce of any kind. But King City, a small agricultural community in Monterey County, California, has taken the opposite approach by adopting zoning regulations and ordinances that encourage marijuana retailers as well as cannabis cultivation and processing facilities to open for business. “Many of us felt cannabis is an agricultural crop, and we treated it as such,” said Mike LeBarre, mayor of the city of 14,700. “We have farmers that have been here for over 100 years, and we want the same for our cannabis businesses,” LeBarre added. After about a year of study, the city adopted an ordinance on Jan. 26, 2016, allowing licenses for the cultivation, production and manufacturing of cannabis. Then, in February 2020, King City passed an ordinance allowing for adult-use and medical marijuana stores that it expects to open by the end of the year. The city also expects three cannabis manufacturing operations and four cultivation facilities to be up and running later this year. Because the city doesn’t have much of a budget to market its pro-cannabis business attitude, LeBarre teamed with King City’s former mayor as well as City Council members to attend MJBizCon in Las Vegas in December 2019. Their mission: Get the word out. “We were the only city to highlight our cannabis program, our low tax rates and our central location to all major cannabis markets in California,” LeBarre crowed. In King City, local taxes are not based on a percentage of revenues generated by a marijuana business. Instead, cannabis manufacturing facilities are charged a flat, annual fee of $30,000. License holders for distribution operations and online and delivery services aren’t charged local taxes, LeBarre added. The benefits of welcoming MJ businesses to the city, the mayor said, include: • Creating local jobs. • Reducing the need for residents to drive to jobs outside King City, which indirectly helps the environment. • Helping eliminate the illicit marijuana industry by fostering a well-regulated legal market. King City began its process so far in advance of California’s first legal adult-use sales in 2018 that there weren’t any templates from other cities for how to craft zoning and ordinances that are welcoming to marijuana businesses, LeBarre said. Since then, he has heard that other California cities are using King City’s zoning rules as a road map to craft their own pro- marijuana rules and regulations. “This is an emerging industry, and there will be growing pains,” LeBarre said. “Just because it’s cannabis doesn’t mean they have a never-ending supply of cash.” – John Rebchook For communities that want to take a page from the playbook created in pro-business King City, California, Mayor Mike LeBarre offers these tips and suggestions: • Clearly define zones and regulations regarding where different kinds of marijuana businesses are allowed. • Make sure California Environmental Quality Act requirements are in place so businesses aren’t tripped up by state regulations. • Visit cannabis cultivation, manufacturing and retail businesses to understand how the industry works. • Have frequent conversations with cannabis business owners to understand their concerns and challenges. • Create a fair and transparent process with a minimum of regulations and taxes. • Keep your word. A King-Sized Welcome Mike LeBarre ZONING MAZE